Document:

Exhibit

ASSET PURCHASE AGREEMENT 

by and between 
 
 
 
MIRAMAR LABS, INC.  
 
 
and 
 
 
 
JAN WALLACE
 
Dated as of January 18, 2008

TABLE OF CONTENTS	
				
	 
	 
	Page

	ARTICLE I PURCHASE AND SALE OF ASSETS; NO  ASSUMPTION OF LIABILITIES
	1
	

	1.1
	Purchase and Sale of Assets
	1
	

	1.2
	Assumption of Liabilities
	2
	

	1.3
	Excluded Liabilities
	2
	

	1.4
	Waiver of Bulk Sales Laws
	2
	

	ARTICLE II PURCHASE CONSIDERATION
	3
	

	2.1
	Payment
	3
	

	2.2
	Tax Allocation
	3
	

	ARTICLE III CLOSING
	4
	

	3.1
	Closing Date
	4
	

	3.2
	Location of Closing
	4
	

	3.3
	Deliveries by Seller
	4
	

	3.4
	Deliveries by Buyer
	5
	

	ARTICLE IV CONDITIONS OF CLOSING
	 

	4.1
	Conditions to Obligations of Buyer
	5
	

	4.2
	Conditions to Obligations of Seller
	5
	

	ARTICLE V REPRESENTATIONS AND WARRANTIES OF SELLER
	 

	5.1
	Organization and Related Matters
	6
	

	5.2
	Authorization; No Conflicts
	6
	

	5.3
	Approvals
	6
	

	5.4
	No Brokers or Finders
	6
	

	5.5
	Legal Proceedings
	7
	

	5.6
	Title; Purchased Assets
	7
	

	5.7
	Compliance with Law
	7
	

	5.8
	Disclosure
	7
	

	ARTICLE VI REPRESENTATIONS AND WARRANTIES OF BUYER
	 

	6.1
	Organization and Related Matters
	7
	

	6.2
	Authorization; No Conflicts
	7
	

	6.3
	Approvals
	8
	

	6.4
	No Brokers or Finders
	8
	

	6.5
	Legal Proceedings
	8
	

	ARTICLE VII ADDITIONAL CONTINUING COVENANTS
	 

	7.1
	Sales and Use Taxes
	8
	

	7.2
	Ownership and Assignment
	8
	

	7.3
	Reversion Rights:
	9
	

	7.4
	Further Assurances
	9
	

	7.5
	Noncompete
	9
	

	7.6
	Nonsolicitation
	9
	

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	ARTICLE VIII INDEMNIFICATION
	 

	8.1
	Seller’s Indemnification
	10
	

	8.2
	Buyer’s Indemnification
	11
	

	ARTICLE IX GENERAL
	 

	9.1
	Survival of Representations and Warranties and Covenants
	11
	

	9.2
	General Rules of Construction
	11
	

	9.3
	Amendments; Waivers
	12
	

	9.4
	Schedules; Exhibits; Integration
	12
	

	9.5
	Governing Law
	12
	

	9.6
	No Assignment
	12
	

	9.7
	Headings
	12
	

	9.8
	Counterparts
	12
	

	9.9
	Successors and Assigns; No Third Party Beneficiaries
	12
	

	9.10
	Notices
	12
	

	9.11
	Expenses
	13
	

	9.12
	Attorney Fees
	13
	

	9.13
	Waiver
	14
	

	9.14
	Other Remedies
	14
	

	9.2
	Representation By Counsel; Interpretation
	14
	

	9
	Severability
	14
	

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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this “Agreement”) is entered into as of January 18, 2008 by and between Miramar Labs, Inc., a Delaware corporation (“Buyer”), and Jan Wallace, an individual (“Seller”).  Capitalized terms used in this Agreement and not otherwise defined have the meanings stated in Exhibit A.  The parties agree as follows: 
BACKGROUND
		
	A.
	Seller is engaged in the business of utilizing microwave technology for various medical treatments (the “Business”).

		
	B.
	Seller desires to sell, transfer and assign to Buyer, and Buyer desires to purchase from Seller, certain assets of the Business (the specific assets to be set forth herein in more detail) (the “Asset Purchase”) on the terms and conditions set forth in this Agreement.

ARTICLE I
PURCHASE AND SALE OF ASSETS; NO  
ASSUMPTION OF LIABILITIES
1.1     Purchase and Sale of Assets.  
		
	1.1.1
	Purchase and Sale of Assets.  Subject to the terms and conditions of this Agreement, at the Closing, Seller will sell, convey, assign, transfer and deliver to Buyer, and Buyer will purchase, acquire and accept from Seller, all right, title and interest in and to all assets, properties, rights, privileges, claims, tangible and intangible, absolute or contingent, that are material to or primarily related to the operation of the Business, wherever located, free and clear of all Encumbrances (collectively, the “Purchased Assets”) including but, not limited to:

		
	(a)
	all corporate records, including corporate correspondence, legal records, device designs, schematics, and specifications;

		
	(b)
	all device inventory including handpieces, generator units and housings, coaxial cables and coolant tubing;

		
	(c)
	all clinical and regulatory records, including filings and correspondence with the U.S. Food & Drug Administration; and

		
	(d)
	all Technology and Intellectual Property Rights therein including the patents and patent applications as set forth on Exhibit D and all causes of action and enforcement rights for the Technology and such Intellectual Property Rights including all rights to pursue damages, injunctive relief and other remedies for past and future infringement or misappropriation of the Technology and Intellectual Property Rights (collectively, the “IP Rights”). 

		
	1.2
	Assumption of Liabilities.  Subject to the terms and conditions of this Agreement, at the Closing, Buyer will assume and agree to pay, perform and discharge as and when due the following, and only the following, liabilities (collectively, the “Assumed Liabilities”): any liabilities or obligations incurred, arising from or out of, in connection with or as a result of claims made by or against Buyer or Seller with respect to the use of the Purchased Assets by or on behalf of Buyer that arise out of events occurring on or after the Closing Date.

		
	1.3
	Excluded Liabilities.  Except for the Assumed Liabilities specifically set forth in Section 1.2 above, Buyer is not assuming, the Assumed Liabilities expressly exclude, and Seller will retain, any debt, liability, duty or obligation, whether known or unknown, fixed or contingent, of Seller (the “Excluded Liabilities”).  Without limiting the foregoing, Excluded Liabilities include liabilities arising from or related to: 

		
	(a)
	Seller’s ownership or operation of the Business and Purchased Assets through the Closing Date; 

		
	(b)
	any employment related claim that accrues or arises as of or prior to the Closing Date, or any of Seller’s other agents, consultants, independent contractors, former employees, whenever arising, in each case including workers’ compensation, paid time off/accrued vacation, severance, salary, bonuses or under any Plan, whether or not the person in question accepts employment with Buyer in connection with the Asset Purchase; 

		
	(c)
	any Orders or Actions arising from or out of, or in connection the operation of the Business prior to the Closing Date; 

		
	(d)
	liabilities for noncompliance with the bulk-transfer provisions of the Uniform Commercial Code (or any similar law); and 

		
	(e)
	liabilities for Taxes of Seller or Taxes attributable to the ownership of the Purchased Assets or operation of the Business for any taxable period (or portion of any period) including, but not limited to, those Taxes resulting from the Asset Purchase hereunder. 

		
	1.4
	Waiver of Bulk Sales Laws.  To the extent applicable to this transaction, Seller and Buyer hereby waive compliance with the bulk-transfer provisions of the Uniform Commercial Code (or any similar law) in connection with the Asset Purchase contemplated hereunder.  

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ARTICLE II
     
PURCHASE CONSIDERATION
2.1    Payment
		
	2.1.1
	Purchase Price and Milestone Payments

Subject to the terms and conditions hereof, Buyer will pay Seller for the Purchased Assets and Assumed Liabilities as per the following:
		
	(a)
	an aggregate cash purchase payment of $20,000 (the “Purchase Price”) on the Closing and up to $15,000 of Seller’s expenses incurred to date for the revival of the patents and patent applications set forth in Exhibit D as evidenced by invoices attached as Exhibit G;

		
	(b)
	promptly following notice to Buyer from the United States Patent and Trademark Office (“USPTO”) of revival of Patent 6,104,959 (“First Milestone”), a payment of $30,000;

		
	(c)
	promptly following notice to Buyer from the USPTO of revival of Patent 6,334,074 (“Second Milestone”), a payment of $30,000;

		
	(d)
	promptly following notice to Buyer from the USPTO of revival of Patent Application 09/637,923, a payment of $15,000 (“Third Milestone”); and

		
	(e)
	promptly following the issuance of a first Patent from Patent Application 09/637,923 (“Fourth Milestone”), a payment of $15,000. 

		
	2.1.2
	Issuance of Warrant

Upon achievement of each Milestone referenced in Section 2.1.1, Buyer shall issue to Seller, in substantially the form attached hereto as Exhibit C, a Warrant to Purchase Shares of Preferred Stock in Buyer (the “Warrant”).  
		
	2.1.3
	Third Party Agreements

Seller shall be entitled to fifty percent (50%) of all profits earned by Buyer as a result of any license or assignment agreement with a third party stemming from any application, use, process or variation of the IP Rights on a worldwide basis. Notwithstanding the forgoing, this Section 2.1.3 shall terminate upon the occurrence of a bona fide Change of Control transaction.
		
	2.2
	Tax Allocation.  Before the Closing, by mutual agreement of the parties, the consideration will be allocated to broad categories constituting components of the Purchased Assets (the “Allocation”).  Each party will report the Asset Purchase in accordance with the agreed upon 

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Allocation for all federal, state, local and other tax purposes, but such allocation will not constrain reporting for other purposes.  
ARTICLE III
CLOSING
		
	3.1
	Closing Date.  The closing of the Asset Purchase (the “Closing”) will take place at 10 A.M. California time on January 18, 2008, after the satisfaction, or waiver by the party for whom such action is a condition to the Closing, of the conditions in Article IV, or at such other time as Seller and Buyer may mutually agree.  The date upon which the Closing occurs is herein called the “Closing Date.”

		
	3.2
	Location of Closing.  The Closing will take place at the offices of Buyer’s counsel, Wilson Sonsini Goodrich & Rosati, 650 Page Mill Road, Palo Alto, CA, 94304-1050 or at such other location as the parties mutually agree.

		
	3.3
	Deliveries by Seller.  At least three (3) days prior to the Closing, Seller shall, at Seller’s sole cost, make available to Buyer or Buyer’s representative, for inspection, collection, and transport, title to and possession of all of the Purchased Assets, or in the case of intangible property, such instruments (other than third-party consents) as are necessary or desirable to document and to transfer such assets from Seller to Buyer in accordance with this Section 3.3.  Without limiting the foregoing, any tangible embodiments of the IP Rights, shall be delivered to Buyer in a medium reasonably requested by Buyer.  To the extent that Buyer cannot be granted title to or possession of certain Purchased Assets as of the Closing, those assets shall be held by Seller for and on behalf of Buyer until such time as Buyer or its designee is granted title or possession thereof and during such period Seller shall bear all risk of loss with respect to such assets.  Without limiting the foregoing, at or prior to the Closing, Seller will deliver to Buyer:

		
	(a)
	Duly executed copies of the Bill of Sale, and all other instruments and documents executed and delivered by any Person in connection with the consummation of any of the Asset Purchase contemplated hereby and thereby (collectively, the “Transaction Documents”).  

		
	(b)
	Duly executed copies of the Patent Rights Agreement dated January 18, 2008, by and between the Seller and Buyer in substantially the form attached hereto as Exhibit E.

		
	(c)
	A certificate of Seller certifying that the conditions set forth in Sections 4.1.1 and 4.1.2 have been satisfied by Seller.

		
	(d)
	Such other good and sufficient instruments of conveyance, assignment and transfer, excluding any consents to assign or acknowledgments of assignment, 

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in form and substance reasonably acceptable to Buyer’s counsel, as shall be effective to vest in Buyer good and valid title in and to the Purchased Assets.
		
	(e)
	Such certificates, filings or other documents necessary or appropriate to evidence that Seller is delivering good and valid title to each of the Purchased Assets free and clear of any Encumbrances. However Seller has previously notified Buyer that the IP Rights for Canada and Australia cannot be revived and Buyer acknowledges and accepts this. 

		
	3.4
	Deliveries by Buyer.  At or prior to the Closing, Buyer will deliver to Seller:

		
	(a)
	The Purchase Price as described in Section 2.1.1(a).

		
	(b)
	Duly executed copies of the Transaction Documents to which Buyer is a Party.

		
	(c)
	A certificate of Buyer certifying that the conditions set forth in Sections 4.2.1 and 4.2.2 have been satisfied by Buyer.

ARTICLE IV
CONDITIONS OF CLOSING

		
	4.1
	Conditions to Obligations of Buyer.  The obligation of Buyer to effect the Closing is subject to the satisfaction (or waiver by Buyer) at or before the Closing of the following conditions:

		
	4.1.1
	Representation and Warranties.  The representations and warranties of Seller contained herein on the date hereof (excluding any updates to a Disclosure Schedule), must be true and correct in all material respects as of the Closing, other than those qualified by materiality, which must be true in all respects, as if made as of the Closing.

		
	4.1.2
	Covenants.  Seller must have in all material respects performed all obligations and complied with all covenants and conditions required by this Agreement to be performed or complied with by it at or prior to the Closing Date. 

		
	4.1.3
	Deliveries.  Seller must have delivered to Buyer all items required by Section 3.3.  

		
	4.2
	Conditions to Obligations of Seller.  The obligation of Seller to effect the Closing is subject to the satisfaction (or waiver by Seller) on or before the Closing of the following conditions:

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	4.2.1
	Representations and Warranties.  The representations and warranties of Buyer contained herein on the date hereof, must be true and correct in all material respects as of the Closing, other than those qualified by materiality, which must be true in all respects, as if made as of the Closing.

		
	4.2.2
	Covenants.  Buyer must have in all material respects performed all obligations and complied with all covenants and conditions required by this Agreement to be performed or complied with by it at or prior to the Closing Date. 

		
	4.2.3
	Deliveries.  Buyer must have delivered to Seller all items required by Section 3.4.

ARTICLE V
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer that except as otherwise indicated on a Disclosure Schedule attached hereto as Exhibit F:
		
	5.1
	Organization and Related Matters.  Seller has all necessary power and authority to own her properties and to carry on the Business and to own and use the Purchased Assets in the Business as presently conducted.  

		
	5.2
	Authorization; No Conflicts.  Seller has all necessary power and authority to execute, deliver and perform this Agreement and the Transaction Documents to which she is a party and to sell, convey and assign the Purchased Assets in accordance with the terms hereof.  The execution, delivery and performance of this Agreement and the Transaction Documents by Seller has been duly and validly authorized by all necessary action on Seller’s part.  This Agreement and the Transaction Documents have been duly executed and delivered by Seller and constitute Seller’s legally valid and binding obligations, enforceable against Seller in accordance with their respective terms except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws and equitable principles relating to or limiting creditors rights generally.  Seller’s execution, delivery and performance of this Agreement and the Transaction Documents will not conflict with, or result in any violation of, or default under, or give rise to a right of termination, cancellation, modification, or acceleration of any obligation or loss of any benefit under any bankruptcy proceeding, order or ruling or any Contract to which Seller is a party or by which the Purchased Assets are bound.

		
	5.3
	Approvals.  No Approvals by any Governmental Entity and no material Approvals by any Person not a party (including a party to any agreement with Seller) to this Agreement are required in connection with the execution or performance of this Agreement by Seller or the consummation of the Asset Purchase.  

		
	5.4
	No Brokers or Finders.  No agent, broker, finder, investment or commercial banker or other firm engaged by or acting on behalf of Seller in connection with the negotiation, execution or performance of this Agreement or the consummation of the Asset Purchase, is or will be 

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entitled to any broker’s or finder’s or similar fees or other commissions payable by Buyer as a result of this Agreement or the Asset Purchase.
		
	5.5
	Legal Proceedings.  There is no Order or Action pending or, to Seller’s Knowledge, threatened against or affecting Seller that individually or when aggregated with one or more other Orders or Actions has or if determined adversely would reasonably be expected to have (a) a Material Adverse Effect, (b) constitute an Assumed Liability, (c) prevent the transfer of or encumber the Purchased Assets.

		
	5.6
	Title; Purchased Assets.  Seller has good and marketable title to, or valid leasehold interests in, each of the Purchased Assets, free and clear of any Encumbrances.  Without limiting the foregoing, the Seller is the sole and exclusive owners of all right, title and interest in and to the IP Rights.  Seller has all rights, power and authority to sell, convey, assign, transfer and deliver to Buyer, in accordance with the terms of this Agreement, all of Seller’s right, title and interest (including leasehold interests) in the Purchased Assets.  No Purchased Assets are leased by Seller.  At the Closing, Seller will deliver title to, and all of Seller’s rights and interests (including leasehold interests) in, the Purchased Assets to Buyer, and Buyer will have acquired good and marketable title in and to, and all of Seller’s rights and interests (including leasehold interests) in, each of the Purchased Assets, free and clear of any Encumbrance.

		
	5.7
	Compliance with Law.  Seller has materially complied with, and is in material compliance with, all Regulations applicable to Seller in connection with the Business or by which any of the Purchased Assets is bound or affected.

		
	5.8
	Disclosure.  Seller has provided Buyer with all the information regarding the Seller reasonably available to her without undue expense that such Buyer has requested for deciding whether to enter into the Asset Purchase.

ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller that:
		
	6.1
	Organization and Related Matters.  Buyer is a corporation duly incorporated, validly existing and in good standing under the laws of State of Delaware.  

		
	6.2
	Authorization; No Conflicts.  Buyer has all necessary corporate authority and power to execute, deliver and perform this Agreement and the Transaction Documents.  The execution, delivery and performance of this Agreement and the Transaction Documents by Buyer have been duly and validly authorized by all necessary action on Buyer’s part.  This Agreement and the Transaction Documents have been duly executed and delivered by Buyer and constitute Buyer’s legally valid and binding obligations, enforceable against Buyer in accordance with their respective terms except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws and equitable 

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principles relating to or limiting creditors’ rights generally.  Buyer’s execution, delivery and performance of this Agreement and the Transaction Documents will not violate, or constitute a breach or default under, Buyer’s Amended and Restated Certificate of Incorporation or Bylaws and will not conflict with, or result in any violation or default under, or give rise to a right of termination, cancellation, modification, or acceleration of any obligation or loss of any benefit under any Contract to which Buyer is a party.
		
	6.3
	Approvals.  Except for any Approvals that Seller may be required to obtain pursuant to this Agreement, no Approvals by any Governmental Entity and no material Approvals by any Person not a party to this Agreement are required in connection with the execution or performance of this Agreement by Buyer or the consummation of the Asset Purchase by Buyer.

		
	6.4
	No Brokers or Finders.  No agent, broker, finder, investment or commercial banker or other firm engaged by or acting on behalf of Buyer in connection with the negotiation, execution or performance of this Agreement or the consummation of the Asset Purchase, is or will be entitled to any broker’s or finder’s or similar fees or other commissions payable by Seller as a result of this Agreement or the Asset Purchase. 

		
	6.5
	Legal Proceedings.  There is no Order or Action pending or, to Buyer’s Knowledge, threatened against or affecting Buyer that individually or when aggregated with one or more other Orders or Actions has or if determined adversely would reasonably be expected to have a material adverse effect on Buyer’s ability to consummate the Asset Purchase.

ARTICLE VII
ADDITIONAL CONTINUING COVENANTS
Seller and Buyer hereby agree to the following:
		
	7.1
	Sales and Use Taxes.  Seller will be responsible for the payment of, and will pay when due, any sales, use, excise, or similar transfer taxes (the “Transfer Taxes”) that may be payable in connection with the sale or purchase of the Purchased Assets; provided that if any law or regulation requires that Buyer (and not the Seller) pay any portion of such Transfer Taxes, Buyer shall pay those Transfer Taxes and shall be promptly reimbursed by the Seller for the amount of those Transfer Taxes paid by Buyer.  The parties hereto will cooperate with each other and use Commercially Reasonable Efforts to minimize the Transfer Taxes.

		
	7.2
	Ownership and Assignment.  Seller agrees that all copyrightable material, notes, records, drawings, designs, inventions, improvements, developments, discoveries and trade secrets conceived, discovered, developed or reduced to practice by Seller, solely or in collaboration with others, during the term of this Agreement that relate in any manner to the business of the Buyer that Seller may be directed to undertake, investigate or experiment with or that Seller may become associated with in work, investigation or experimentation in the Buyer’s line of business in performing under this Agreement (collectively, “Inventions”), are the sole property of the Buyer. Seller also agrees to assign (or cause to be assigned) and hereby 

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assigns fully to the Buyer all such Inventions and Intellectual Property Rights in or comprising or otherwise relating to such Inventions.
		
	7.3
	Reversion Rights:  Buyer agrees that if within five (5) years from the date of the Closing, it has not utilized or marketed the microwave therapy system to produce sales revenue then, if such delay is not caused by any action or inaction of the Seller, the Purchased Assets including all IP Rights under this Agreement shall revert to the Seller. Buyer agrees to execute any and all documentation required to return ownership of the Purchased Assets including the IP rights. Seller shall notify the Buyer in writing of the right to reversion.

		
	7.4
	Further Assurances.  At any time or from time to time after the Closing, at Buyer’s request and without further consideration, Seller shall: (i) execute any documents necessary to perfect the assignment of any and all IP Rights, (ii) execute and deliver to Buyer such other instruments of sale, transfer, conveyance, assignment and confirmation in furtherance of the Asset Purchase; (iii) provide materials and information reasonably requested by Buyer in connection with the Purchased Assets; and (iv) take such other actions, as Buyer may reasonably deem necessary or desirable and reasonably request in order more effectively to transfer, convey and assign to Buyer, to confirm Buyer’s title to, all of the Purchased Assets, to enforce Buyer’s Rights thereunder and, to the full extent permitted by law, to put Buyer in actual possession and operating control of the Purchased Assets and to assist Buyer in exercising all rights with respect thereto. Without limiting the foregoing, the Seller shall: (a) assist in the transfer and answer questions relating to Seller’s records including regulatory filings and clinical data, (b) cooperate in any and all ongoing efforts by Buyer to revive the IP Rights, and (c) cooperate in any efforts to perfect Buyer’s title to and ownership in any of the Purchased Assets.

		
	7.5
	Noncompete.  Seller acknowledges that the nature of the Buyer’s business is such that if Seller were to become employed by, or substantially involved in, the business of a competitor of the Buyer beginning on the date of this Agreement and for a period of three (3) years following the completion of the Fourth Milestone, it would be very difficult for the Seller not to rely on or use the Buyer’s trade secrets and confidential information.  Thus, to avoid the inevitable disclosure of the Buyer’s trade secrets and confidential information, Seller agrees and acknowledges that her right to receive the Purchase Price and Milestone Payments set forth in Section 2.1 (to the extent Seller is otherwise entitled to such payments) shall be conditioned upon Seller not directly or indirectly engaging in (whether as an employee, consultant, agent, proprietor, principal, partner, stockholder, corporate officer, director or otherwise), nor having any ownership interest in or participating in the financing, operation, management or control of, any person, firm, corporation or business that competes with Buyer or is a customer of the Buyer.  Upon any breach of this Section 7.5, Seller shall refund the Purchase Price and any Milestone Payments received pursuant to this Agreement and Buyer shall no longer have any obligation to make such payments.

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	7.6
	Nonsolicitation.  Beginning on the date of this Agreement and ending on the third (3rd) anniversary of the Closing, Seller will not directly or indirectly, make, offer, solicit, induce or encourage or take any other action that is intended to induce or encourage, or has the effect of inducing of encouraging, any of Buyer’s employees to terminate his or her employment with Buyer.  The parties agree that in the event of a breach or threatened breach by Seller of any of the covenants set forth in this Section 7.6, monetary damages alone would be inadequate to fully protect Buyer from, and compensate Buyer for, the harm caused by such breach or threatened breach.  Accordingly, Seller agrees that if she breaches or threatens breach of any provision of this Section 7.6, Buyer will be entitled to seek, in addition to any other right or remedy otherwise available, the right to injunctive relief restraining such breach or threatened breach and to specific performance of any such provision of this Section 7.6

ARTICLE VIII
INDEMNIFICATION
8.1    Seller’s Indemnification 
Subject to Section 9.1 and the limitations set forth in this Section 8.1, from and after the Closing, Seller shall indemnify and hold harmless Buyer and its Affiliates and each of the heirs, executors, successors and assigns of any of the foregoing (collectively, the “Buyer Indemnified Parties”) from and against any and all losses (whether or not involving a Third Party Claim) of the Buyer Indemnified Parties (collectively the “Buyer Losses”) arising out of or incurred with respect to:
		
	81.1
	any breach of any or all of Seller’s own representations and warranties in the Agreement or the nonperformance of any or all of its covenants or obligations to be performed by Seller under the Agreement;

		
	8.1.2
	any breach of any or all of the representations and warranties of the Seller in the Agreement;

		
	8.1.3
	the breach or nonperformance of any covenant or obligation to be performed by the Seller under the Agreement; 

		
	8.1.4
	any Pre Closing Tax Liabilities;

		
	8.1.5
	any amounts which become due and payable by the Seller as a result of this Agreement or pursuant to any other agreement between the Seller and other Person; and

		
	8.1.6
	any Seller expenses on cover under this agreement.

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Notwithstanding the above, Seller’s obligations under this Section 8.1 shall not exceed the amount of the Purchase Price and Milestone Payments due and payable under Section 2.1.1 of this Agreement.

8.2    Buyer’s Indemnification 
Subject to Section 9.1 and the limitations set forth in this Section 8.2, from and after the Closing, Buyer shall indemnify and hold harmless Seller and each of her heirs, executors, successors and assigns of any of the foregoing (collectively, the “Seller Indemnified Parties”) from and against any and all losses (whether or not involving a Third Party Claim) of the Seller Indemnified Parties (collectively the “Seller Losses”) arising out of or incurred with respect to:
		
	8.2.1
	any breach of any or all of Buyer’s own representations and warranties in the Agreement or the nonperformance of any or all of its covenants or obligations to be performed by Buyer under the Agreement;

		
	8.2.2
	any breach of any or all of the representations and warranties of the Buyer in the Agreement; and

		
	8.2.3
	the breach or nonperformance of any covenant or obligation to be performed by the Buyer under the Agreement; 

Notwithstanding the above, Buyer’s obligations under this Section 8.2 shall not exceed the amount of the Purchase Price and Milestone Payments due and payable under Section 2.1.1 of this Agreement.
ARTICLE IX
GENERAL
		
	9.1
	Survival of Representations and Warranties and Covenants.  Each of the representations and warranties made in this Agreement will terminate on the date that is two years after the Closing Date, except that those representations and warranties made in Sections 5.1 (Organization and Related Matters), 5.2 (Authorization; No Conflicts), 5.6 (Title; Purchased Assets), 6.1 (Organization and Related Matters) and 6.2 (Authorization; No Conflicts) will survive the Closing and remain in full force and effect for the applicable statute of limitations.  The covenants and agreements of the parties set forth in this Agreement and the indemnification obligations of the parties hereunder will survive for the applicable statute of limitations, except as expressly provided herein.

		
	9.2
	General Rules of Construction.  For all purposes of this Agreement and the Exhibits and the Disclosure Schedule delivered pursuant to this Agreement, except as otherwise expressly provided or unless the context otherwise requires: (a) terms include the plural as well as the singular; (b) all accounting terms not otherwise defined have the meanings assigned under 

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GAAP; (c) all references in this Agreement to designated “Articles,” “Sections” and other subdivisions are to the designated Articles, Sections and other subdivisions of the body of this Agreement; (d) the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Section or other subdivision; (e) ”or” is not exclusive; and (f) ”including” and “includes” will be deemed to be followed by “but not limited to” and “but is not limited to,” respectively.
		
	9.3
	Amendments; Waivers.  Except as expressly provided herein, this Agreement and the attached Disclosure Schedule or any Exhibit may be amended only by agreement in writing of all parties.  No waiver of any provision nor consent to any exception to the terms of this Agreement or any agreement contemplated hereby will be effective unless in writing and signed by the party to be bound and then only to the specific purpose, extent and instance so provided.

		
	9.4
	Schedules; Exhibits; Integration.  The Disclosure Schedule and each Exhibit delivered pursuant to the terms of this Agreement must be in writing and will constitute a part of this Agreement.  This Agreement, together with the Disclosure Schedule and Exhibits and the Non Disclosure Agreement dated September 4, 2007 by and between the parties, and the other agreements and instruments delivered at the Closing, constitutes the entire agreement among the parties pertaining to the subject matter hereof and supersedes all prior agreements and understandings, both written and oral, of the parties in connection therewith.

		
	9.5
	Governing Law.  This Agreement and the legal relations between the parties will be governed by and construed in accordance with the laws of the State of California applicable to contracts made and performed in such State and without regard to conflicts of law doctrines unless certain matters are preempted by federal law.

		
	9.6
	No Assignment.  Unless otherwise expressly provided, neither this Agreement nor any rights or obligations under it are assignable by one party without the prior written consent of the other party other than in connection with a Change of Control of party.

		
	9.7
	HeadingsThe descriptive headings of the Articles, Sections and subsections of this Agreement are for convenience only and do not constitute a part of this Agreement. 

		
	9.8
	Counterparts.  This Agreement and any amendment hereto or any other agreement delivered pursuant hereto may be executed in one or more counterparts and by different parties in separate counterparts.  All counterparts will constitute one and the same agreement and will become effective when one or more counterparts have been signed by each party and delivered to the other party.  A facsimile signature page will be deemed an original.

		
	9.9
	Successors and Assigns; No Third Party Beneficiaries.  This Agreement, except for Section 2.1.3, is binding upon and will inure to the benefit of each party and their respective successors or assigns, and nothing in this Agreement, express or implied, is intended to confer upon any other Person or Governmental Entity any rights or remedies of any nature whatsoever under or by reason of this Agreement.

-12-

		
	9.10
	Notices.  All notices, demands and other communications to be given or delivered under or by reason of the provisions of this Agreement must be in writing and will be deemed to have been given: (a) immediately when personally delivered or delivery is refused; (b) when received by first class mail, return receipt requested; (c) one day after being sent by Federal Express or other overnight delivery service; or (d) when receipt is acknowledged, either electronically or otherwise, if sent by facsimile, telecopy or other electronic transmission device.  Notices, demands and communications to Buyer and Seller will, unless another address is specified by Buyer or Seller hereafter in writing, be sent to the address indicated below:

If to Buyer, addressed to:
Miramar Labs, Inc. 
199 Jefferson Drive 
Menlo Park, CA 94025 
Attention: President and Chief Executive Officer
with a copy to (which will not constitute notice):
Wilson Sonsini Goodrich & Rosati 
Professional Corporation 
650 Page Mill Road 
Palo Alto, CA 9434-1050 
Attention: Philip H. Oettinger 
Facsimile: 650-493-6811 
Email: poettinger@wsgr.com
If to Seller, addressed to:
Jan Wallace  
4223 Glencoe Avenue, Suite B130
Marina Del Rey, California 90292
Facsimile: 310-827-0600
with a copy to (which will not constitute notice):
Claire C. Ambrosio, Attorney at Law  
4223 Glencoe Avenue, Suite B130
Marina Del Rey, California 90292
Facsimile: 310-827-0600 

-13-

		
	9.11
	Expenses.  Except as otherwise set forth herein, Seller and Buyer will each pay their own expenses incident to the negotiation, preparation and performance of this Agreement and the Asset Purchase, including, the fees, expenses and disbursements of their respective accountants and counsel.

		
	9.12
	Attorney Fees.  In the event of any Action for the breach of this Agreement or for misrepresentation by any party, the prevailing party will be entitled to reasonable attorney’s fees, costs and expenses incurred in such Action.  Attorneys fees incurred in enforcing any judgment in respect of this Agreement are recoverable as a separate item.  The preceding sentence is intended to be severable from the other provisions of this Agreement and to survive any judgment and, to the maximum extent permitted by law, will not be deemed merged into any such judgment. 

		
	9.13
	Waiver.  No failure on the part of any party to exercise or delay in exercising any right hereunder will be deemed a waiver thereof, nor will any single or partial exercise preclude any further or other exercise of such or any other right.

		
	9.14
	Other Remedies.  Any and all remedies herein expressly conferred upon a party will be deemed cumulative with and not exclusive of any other remedy conferred hereby, or by law or equity upon such party, and the exercise by a party of any one remedy will not preclude the exercise of any other remedy.

		
	9.15
	Representation By Counsel; Interpretation.  Seller and Buyer each acknowledge that each has been represented by counsel in connection with this Agreement and the Asset Purchase.  Accordingly, any rule of law or any legal decision that would require interpretation of any claimed ambiguities in this Agreement against the party that drafted it has no application and is expressly waived.  The provisions of this Agreement will be interpreted in a reasonable manner to effect the intent of Buyer and Seller.

		
	9.16
	Severability.  If any provision of this Agreement is held to be unenforceable for any reason, it will be adjusted rather than voided, if possible, to achieve the intent of the parties.  All other provisions of this Agreement will be deemed valid and enforceable to the extent possible.

[signature page to follow]

-14-

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed by its duly authorized officers as of the day and year first above written.

	
		
	“BUYER”

	 

	MIRAMAR LABS, INC.

	By: 
	 /s/ Mark Deem

	Name:
	Mark Deem

	Title:
	CEO

	 
	 

	“SELLER”

	 

	JAN WALLACE

	By: 
	 /s/ Jan Wallace

	Name:
	Jan Wallace

EXHIBIT A 

DEFINITIONS
“Action” means an action, suit, investigation, complaint, claim, notice of infringement, instruction to cease and desist, demand or other proceeding, threatened or pending, whether civil or criminal, in law or in equity or before any arbitrator or Governmental Entity.
“Affiliate” of a Person means a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, a specified Person.  The term “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) means the possession of the power to direct the management and policies of the referenced Person, whether through ownership interests, by contract or otherwise.
“Approval” means an authorization, consent, consent to assignment, approval or waiver of, clearance by, notice to or registration or filing with, or any other similar action by or with respect to a Governmental Entity or any other Person that is required in order to consummate the Asset Purchase, including transferring or assigning all of the Purchased Assets to Buyer.
“Bill of Sale” means that certain Bill of Sale by Seller to be entered into on the Closing Date, the form of which is attached as Exhibit B.
“Change of Control” means: (a) the consummation of a merger or consolidation of party with or into another entity or any other corporate reorganization, if more than 50% of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation or other reorganization is owned by Persons or companies who were not stockholders or owners immediately prior to such merger, consolidation or other; or (b) the sale, transfer or other disposition of all or substantially all of the Company’s assets.
“Commercially Reasonable Efforts” means efforts that are designed to enable a party, directly or indirectly, to satisfy a condition to, comply with a covenant required by, or otherwise assist in the consummation of, the Asset Purchase and that do not require the performing party to expend funds or assume liabilities other than expenditures and liabilities that are customary and reasonable in nature and amount in the context of the Asset Purchase.
“Contract” means any mortgage, indenture, lease, contract, covenant or other agreement, instrument or commitment, permit, concession, franchise or license.
“Disclosure Schedule” means Seller’s Disclosure Schedule delivered by Seller to Buyer on the date hereof and as amended from time to time pursuant to the terms of this Agreement as the context requires.  Any fact or item that is disclosed in any section of the Disclosure Schedule will be deemed to be disclosed in all applicable sections of the Disclosure Schedule, notwithstanding the omission of a reference or a cross-reference thereto.  The disclosure of any fact or item in the Disclosure Schedule will not constitute any acknowledgment regarding the materiality of such disclosure or 

A-1

whether the subject matter of such disclosure will have a Material Adverse Effect.  The Seller’s Disclosure Schedules shall be attached hereto as Exhibit F.
“Dollars” and “$” refer to United States dollars and other lawful currency of the United States of America.
“Encumbrance” means any claim, charge, lease, covenant, easement, encumbrance, security interest, lien, option, pledge, right of others, or restriction of any nature (whether on voting, sale, transfer, disposition, use, ownership, competition or otherwise), whether imposed by agreement, understanding, law, equity or otherwise, except for any restrictions on transfer generally arising under any applicable federal or state securities law or any Permitted Encumbrances.
“GAAP” means United States generally accepted accounting principles consistently applied by Seller.
“Governmental Entity” means any agency, bureau, commission, court, department, official, political subdivision, tribunal or other instrumentality of any government, whether federal, state, county or local, domestic or foreign.
“Intellectual Property Rights” means any or all statutory and/or common law rights throughout the world in, arising out of, or associated with: (i)  all inventions (whether patentable or not) and invention disclosures and improvements thereon, and patents, inventor’s certificates and utility models and any and all applications and registrations therefor (including any including any continuation, divisional, substitution, continuations-in-part, provisional and utility applications), and all substitutions, extensions, confirmations, reissues, divisions, re‐examinations, renewals and extensions thereof, and equivalent or similar rights in inventions (“Patents”); (ii)  copyrights, copyright registrations and any and all applications therefor and other rights corresponding thereto; (iii) all industrial designs and any registrations and applications therefor; (iv) all databases and data collections (including knowledge databases, customer lists and customer databases); (v) confidential information, trade secrets and know-how, including processes drawings, prototypes, models, designs and other industry information, and all documentation relating to any of the foregoing; and (vi) all rights in or to software or other Technology.  
 “Material Adverse Effect” means any change in or effect on the Purchased Assets, Assumed Liabilities or the Business as expected to be conducted immediately after the Closing (i.e., giving effect to the transfers of the Purchased Assets and Assumed Liabilities contemplated by this Agreement) that would (a) be materially adverse to the conduct or value of the Business by Buyer immediately following the Closing Date, (b) materially impair the validity or enforceability of this Agreement and the Transaction Documents taken as a whole, or (c) materially impair the value of the Purchased Assets; provided, however, that the following will not constitute a Material Adverse Effect: (i) general economic conditions; (ii) any changes generally affecting the industries in which Seller currently operates the Business, provided that such changes do not materially disproportionately affect Seller; or (iii) anything specifically disclosed in a Disclosure Schedule.
“Order” means any decree, injunction, judgment, order, ruling, assessment or writ.

A-2

“Ordinary Course” means for the Business, with respect to any Person and as of any date of determination, the conduct or operation of a line of business of such Person in the ordinary course of such business, as then conducted and proposed to be conducted, in a manner consistent with the past business practices of such Person and in accordance with the reasonable requirements of such business, in each case as determined with respect to such business as of such date of determination.
“Payables” means all accounts payable to trade creditors relating to or arising from the Business that are reflected on the Unaudited Statements and unpaid as of the Closing.  Payables will be computed in accordance with GAAP, but will not include Seller’s transaction expenses in connection with the Asset Purchase. 
“Permitted Encumbrances” means: (a) Encumbrances for Taxes not yet delinquent or the validity of which are being contested in good faith by appropriate actions and that are described in a Disclosure Schedule; (b) Encumbrances existing on the Closing Date to remain on the Purchased Assets after the Closing as listed in a Disclosure Schedule; (c) Encumbrances that are statutory liens of landlords, carriers, warehousemen, mechanics, materialmen and other Encumbrances imposed by law created in the Ordinary Course of Seller for amounts not yet due and for which, at Closing, Seller will have incurred no liability to pay; (d) Encumbrances that are minor or technical defects in title that in the aggregate do not materially affect the value, marketability or utility of the Purchased Assets as presently used; and (e) Encumbrances that are Assumed Liabilities.
“Person” means an individual, a corporation, a partnership, a limited liability company, a joint venture, an association, a trust, an unincorporated association or any other entity or organization, including a Governmental Entity.
“Regulation” means (a) any applicable law, statutes, rule, regulation, ordinance, judgment, decree, ruling, order, award, injunction, recommendation or other official action of any Governmental Entity, and (b) any official change in the interpretation or administration of any of the foregoing by the Governmental Entity or by any other Governmental Entity or other Person responsible for the interpretation or administration of any of the foregoing.
“Taxes” means any foreign, federal, state, county or local income, sales and use, excise, franchise, real and personal property, transfer, gross receipt, capital stock, production, business and occupation, disability, employment, payroll, severance or withholding tax or charge imposed by any Governmental Entity, any interest and penalties (civil or criminal) related thereto or to the nonpayment thereof and any obligations under any agreements or arrangements with any other person with respect to such amounts and including any liability for taxes of a predecessor entity.
“Technology” means any and all technical information, know-how, test results, knowledge, techniques, discoveries, data, ideas, specifications, designs, trade secrets, regulatory and other governmental filings, documents, apparatus, clinical and regulatory strategies, manufacturing information, descriptions, compositions of matter, processes, methods, procedures, assays, preclinical and clinical data, analytical and quality control or assurance data and any other similar information.

A-3

EXHIBIT B 
 
FORM OF BILL OF SALE 
This Bill of Sale (this “Bill of Sale”) is made effective as of January 18, 2008, by and by and between Miramar Labs, Inc., a Delaware corporation (“Buyer”), and Jan Wallace, an individual (“Seller”). Capitalized terms used in this Agreement and not otherwise defined have the meanings stated in the Asset Purchase Agreement (as defined below).  The parties hereto hereby agree as follows:
BACKGROUND
WHEREAS, the parties have entered into that certain Asset Purchase Agreement, dated as of January 18, 2008 (the “Asset Purchase Agreement”), under which Seller has agreed to sell, convey, assign, transfer and deliver the Purchased Assets to Buyer or its assigns.
		
	1.
	Sale.  Seller does hereby sell, convey, assign, transfer and deliver to Buyer, and Buyer does hereby purchase, acquire and accept from Seller, all of Seller’s right, title and interest in and to the Purchased Assets.

		
	2.
	Representations.  All representations, warranties, agreements and indemnities of Seller with respect to the Purchased Assets set forth in the Asset Purchase Agreement will continue in effect as provided therein and will not be deemed to be amended, modified, terminated or superseded by or merged with this Bill of Sale.

		
	3.
	Miscellaneous Provisions.

		
	3.1
	Amendments; Waiver.  The terms, provisions and conditions of this Bill of Sale may be amended only by agreement in writing of all parties.  No waiver of any provision nor consent to any exception to the terms of this Bill of Sale or any agreement contemplated hereby will be effective unless in writing and signed by the party to be bound and then only to the specific purpose, extent and instance so provided.  

		
	3.2
	Further Assurances.  Each party will execute and deliver, both before and after the Closing, such further certificates, agreements and other documents and take such other actions as the other party may reasonably request or as may be necessary or appropriate to consummate or implement the Asset Purchase, including to more effectively transfer the Purchased Assets, or to evidence such events or matters.  

		
	3.3
	Assignment.  Neither this Bill of Sale nor any rights or obligations under it are assignable by one party without the prior written consent of the other party other than in connection with a Change of Control of a party.  

		
	3.4
	Descriptive Headings.  The descriptive headings of the sections and subsections of this Bill of Sale are for convenience only and do not constitute a part of this Bill of Sale.  

B-1

		
	3.5
	Counterparts.  This Bill of Sale and any amendment hereto or any other agreement delivered pursuant hereto may be executed in one or more counterparts and by different parties in separate counterparts.  All counterparts will constitute one and the same agreement and will become effective when one or more counterparts have been signed by each party and delivered to the other party.  A facsimile signature page will be deemed an original.  

		
	3.6
	Governing Laws.  This Bill of Sale and the legal relations between the parties will be governed by and construed in accordance with the laws of the State of California applicable to contracts made and performed in such State and without regard to conflicts of law doctrines unless certain matters are preempted by federal law.  

		
	3.7
	Waiver.  No failure on the part of any party to exercise or delay in exercising any right hereunder will be deemed a waiver thereof, nor will any single or partial exercise preclude any further or other exercise of such or any other right.  

		
	3.8
	Representation By Counsel; Interpretation.  The parties each acknowledge that each has been represented by counsel in connection with this Bill of Sale and the Asset Purchase.  Accordingly, any rule of law or any legal decision that would require interpretation of any claimed ambiguities in this Bill of Sale against the party that drafted it has no application and is expressly waived.  The provisions of this Agreement will be interpreted in a reasonable manner to effect the intent of the parties hereto.  

		
	3.9
	Severability.  If any provision of this Bill of Sale is held to be unenforceable for any reason, it will be adjusted rather than voided, if possible, to achieve the intent of the parties.  All other provisions of this Bill of Sale will be deemed valid and enforceable to the extent possible.

		
	4.
	Reversion Rights:  Buyer agrees that if within five (5) years from the date of this Bill of Sale it has not utilized or marketed the microwave therapy system to produce sales revenue then, if such delay is not caused by any action or inaction of the Seller, the Purchased Assets acquired under this Bill of Sale shall revert to the Seller. Buyer agrees to execute any and all documentation required to return ownership of the Purchased Assets. Seller shall notify the Buyer in writing of the right to reversion.

[signature page to follow]

B-2

IN WITNESS WHEREOF, Seller and Buyer have caused this Bill of Sale and License to be duly executed as of the day and year first above written.

	
		
	“BUYER”

	 

	MIRAMAR LABS, INC.

	By: 
	 /s/ Mark Deem

	Name:
	Mark Deem

	Title:
	CEO

	 
	 

	“SELLER”

	 

	JAN WALLACE

	By: 
	 /s/ Jan Wallace

	Name:
	Jan Wallace

EXHIBIT C 
 
FORM OF WARRANT AGREEMENT

C-1

THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.  THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED.

   Void after
                                     [_______ __, 2___]
MIRAMAR LABS, INC.
WARRANT TO PURCHASE SHARES OF SERIES A PREFERRED STOCK 

This Warrant is issued to Jan Wallace (the “Holder”) by Miramar Labs, Inc., a Delaware corporation (the “Company”), pursuant to the terms and conditions set forth herein.
1.Purchase of Shares.  Subject to the terms and conditions hereinafter set forth, the Holder of this Warrant is entitled, upon surrender of this Warrant at the principal office of the Company (or at such other place as the Company shall notify the Holder hereof in writing) during the Exercise Period, to purchase from the Company the number of fully paid and nonassessable Shares (as defined below), that equals the quotient obtained by dividing (a) the Warrant Coverage Amount (as defined below) by (b)  the Exercise Price (as defined below).
2.    Definitions.
(a)    Exercise Price.  The exercise price for the Shares shall be the price per Share in the Series A preferred financing ($1.00/Share) (“Exercise Price”).
(b)    Exercise Period.  This Warrant shall be exercisable in whole during the term commencing on the date that the [First][Second][Third][Fourth] Milestone is achieved under the Asset Purchase Agreement dated January 18, 2008 by and between the parties (the “APA”) and ending on the earlier of 5:00 p.m. on the date five (5) years thereafter, or earlier expiration of this Warrant pursuant to Section 12 hereof. 
(c)    Warrant Coverage Amount.  The term “Warrant Coverage Amount” shall mean the amount of the cash payment made at the [First][Second][Third][Fourth] Milestone under the APA.
(d)    The Shares.  The term “Shares” shall mean shares of the Company’s Series A Preferred Stock (as may be adjusted pursuant to Section 6 hereof).

-2-

(e)    Change of Control.  The term “Change of Control” shall mean (i) the acquisition of the Company by another entity by means of any transaction or series of related transactions (including, without limitation, any transfer of more than 50% of the voting power of the Company, reorganization, merger or consolidation, but excluding any merger effected exclusively for the purpose of changing the domicile of the Company);or (ii) the sale of all or substantially all of the assets of the Company; unless the Company's stockholders of record as constituted immediately prior to such acquisition or sale will, immediately after such acquisition or sale (by virtue of securities issued as consideration for the Company's acquisition or sale or otherwise) hold at least fifty percent (50%) of the voting power of the surviving or acquiring entity.
3.    Method of Exercise.  During the Exercise Period, the Holder may exercise in whole the purchase rights evidenced hereby. Such exercise shall be effected by:
(i)    the surrender of the Warrant, together with a notice of exercise to the Secretary of the Company at its principal offices; and
(ii)    the payment to the Company of an amount equal to the Warrant Coverage Amount.
4.    Certificates for Shares.  Upon the exercise of the purchase rights evidenced by this Warrant, one or more certificates for the number of Shares so purchased shall be issued as soon as practicable thereafter, and in any event within thirty (30) days of the delivery of the exercise notice and the payment of the Warrant Coverage Amount. 
5.    Issuance of Shares.  The Company covenants that the Shares, when issued pursuant to the exercise of this Warrant, will be duly and validly issued, fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issuance thereof.
6.    Adjustment of Exercise Price and Number of Shares.  The number of and kind of securities purchasable upon exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time as follows:
(a)    Subdivisions, Combinations and Other Issuances.  If the Company shall at any time prior to the expiration of this Warrant subdivide the Shares, by split‐up or otherwise, or combine its Shares, or issue additional shares of its Shares as a dividend, the number of Shares issuable on the exercise of this Warrant shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the case of a combination.  Appropriate adjustments shall also be made to the purchase price payable per share, but the 

-3-

aggregate purchase price payable for the total number of Shares purchasable under this Warrant (as adjusted) shall remain the same.  Any adjustment under this Section 6(a) shall become effective at the close of business on the date the subdivision or combination becomes effective, or as of the record date of such dividend, or in the event that no record date is fixed, upon the making of such dividend.
(b)    Reclassification, Reorganization and Consolidation.  In case of any reclassification, capital reorganization, or change in the capital stock of the Company (other than as a result of a subdivision, combination, or stock dividend provided for in Section 6(a) above), then the Company shall make appropriate provision so that the Holder of this Warrant shall have the right at any time prior to the expiration of this Warrant to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization, or change by a Holder of the same number of Shares as were purchasable by the Holder of this Warrant immediately prior to such reclassification, reorganization, or change.  In any such case appropriate provisions shall be made with respect to the rights and interest of the Holder of this Warrant so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same.
(c)    Notice of Adjustment.  When any adjustment is required to be made in the number or kind of shares purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of Shares or other securities or property thereafter purchasable upon exercise of this Warrant.
7.    No Fractional Shares or Scrip.  No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant, but in lieu of such fractional shares the Company shall make a cash payment therefor on the basis of the Exercise Price then in effect.  
8.    Representations of the Company.  The Company represents that all corporate actions on the part of the Company, its officers, directors and stockholders necessary for the sale and issuance of this Warrant have been taken.
9.    Representations and Warranties by the Holder. The Holder represents and warrants to the Company as follows:
(a)    This Warrant and the Shares issuable upon exercise thereof are being acquired for its own account, for investment and not with a view to, or for resale in connection with, any distribution or public offering thereof within the meaning of the Securities Act of 1933, as amended (the "Act").  Upon exercise of this Warrant, the Holder shall, if so requested by the Company, confirm in writing, in a form satisfactory to the Company, that the securities issuable upon exercise of this Warrant are being acquired for investment and not with a view toward distribution or resale.
(b)    The Holder understands that the Warrant and the Shares have not been registered under the Act by reason of their issuance in a transaction exempt from the registration and 

-4-

prospectus delivery requirements of the Act pursuant to Section 4(2) thereof, and that they must be held by the Holder indefinitely, and that the Holder must therefore bear the economic risk of such investment indefinitely, unless a subsequent disposition thereof is registered under the Act or is exempted from such registration.  The Holder further understands that the Warrant Shares have not been qualified under the California Securities Law of 1968 (the "California Law") by reason of their issuance in a transaction exempt from the qualification requirements of the California Law pursuant to Section 25102(f) thereof, which exemption depends upon, among other things, the bona fide nature of the Holder's investment intent expressed above.
(c)    The Holder has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the purchase of this Warrant and the Shares purchasable pursuant to the terms of this Warrant and of protecting its interests in connection therewith.
(d)    The Holder is able to bear the economic risk of the purchase of the Shares pursuant to the terms of this Warrant.
(e)    The Holder is an “accredited investor” as such term is defined in Rule 501 of Regulation D promulgated under the Act.
10.    Restrictive Legend.
The Shares (unless registered under the Act) shall be stamped or imprinted with a legend in substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF, AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.  SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.  COPIES OF THE AGREEMENT COVERING THE PURCHASE OF THESE SHARES AND RESTRICTING THEIR TRANSFER MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE COMPANY AT THE PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY.
11.    Rights of Stockholders.  No holder of this Warrant shall be entitled, as a Warrant holder, to vote or receive dividends or be deemed the holder of the Shares or any other securities of the Company which may at any time be issuable on the exercise hereof for any purpose, nor shall anything contained herein be construed to confer upon the holder of this Warrant, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action (whether upon any recapitalization, issuance of stock, reclassification of stock, 

-5-

change of par value, consolidation, merger, conveyance, or otherwise) or to receive notice of meetings, or to receive dividends or subscription rights or otherwise until the Warrant shall have been exercised and the Shares purchasable upon the exercise hereof shall have become deliverable, as provided herein.
12.    Expiration of Warrant; Notice of Certain Events Terminating This Warrant.  
(a)This Warrant shall expire and shall no longer be exercisable upon the earlier to occur of:
(i)Any Change of Control; or
(ii)The initial public offering of the Company's Common Stock.
(b)The Company shall provide at least fifteen (15) days prior written notice of any event set forth in Section 12(a)(i) or (ii).
13.    Notices.  All notices and other communications required or permitted hereunder shall be in writing, shall be effective when given, and shall in any event be deemed to be given upon receipt or, if earlier, (a) five (5) days after deposit with the U.S.  Postal Service or other applicable postal service, if delivered by first class mail, postage prepaid, (b) upon delivery, if delivered by hand, (c) one business day after the business day of deposit with Federal Express or similar overnight courier, freight prepaid or (d) one business day after the business day of facsimile transmission, if delivered by facsimile transmission with copy by first class mail, postage prepaid, and shall be addressed (i) if to the Holder, at the Holder's address as set forth Jan Wallace 4223 Glencoe Avenue Suite B130, Marina Del Rey, California 90292, with a copy to Claire C. Ambrosio, Attorney at Law 4223 Glencoe Avenue, Suite B130, Marina Del Rey, California 90292 and (ii) if to the Company, at the address of its principal corporate offices (attention: President), with a copy to Philip H. Oettinger, Wilson Sonsini Goodrich & Rosati, P.C., 650 Page Mill Road, Palo Alto, California 94304 or at such other address as a party may designate by ten days advance written notice to the other party pursuant to the provisions above.
14.    “Market Stand-Off” Agreement.  Holder hereby agrees that, during the period of duration specified by the Company and an underwriter of common stock or other securities of the Company, following the effective date of a registration statement of the Company filed under the Act for the Company’s initial public offering, it shall not, to the extent requested by the Company and such underwriter, subject to the terms hereof, directly or indirectly sell, offer to sell, contract to sell (including, without limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of (other than to donees who agree to be similarly bound) any securities of the Company held by it at any time during such period except common stock included in such registration; provided, however, that 
(a)    all officers and directors of the Company enter into similar agreements;

-6-

(b)    the Company obtains from persons who hold one percent (1%) or greater of the Company’s outstanding capital stock, a lock-up agreement similar to that set forth in this Section 14; and
(c)    such market stand-off time period shall not exceed one hundred eighty (180) days.
Holder agrees to provide to the other underwriters of any public offering such further agreements as such underwriter may reasonably request in connection with this market stand-off agreement, provided that the terms of such agreements are substantially consistent with the provisions of this Section 14.  In order to enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Registrable Securities of each holder (and the shares or securities of every other person subject to the foregoing restriction) until the end of such period.
Notwithstanding the foregoing, the obligations described in this Section 14 shall not apply to a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms which may be promulgated in the future, or a registration relating solely to an SEC Rule 145 transaction.
15.    Registration Rights Agreement.  The registration rights of the Holder (including Holders' successors) with respect to the Common Stock issuable upon conversion of the Shares issuable upon exercise of this Warrant will be the same as granted to the holders of shares issued in the Qualified Equity Financing. 
16.    Governing Law.  This Warrant and all actions arising out of or in connection with this Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to the conflicts of law provisions of the State of California or of any other state.
17.    Rights and Obligations Survive Exercise of Warrant.  Unless otherwise provided herein, the rights and obligations of the Company, of the Holder of this Warrant and of the holder of the Shares issued upon exercise of this Warrant, shall survive the exercise of this Warrant.

-7-

Issued this ____ day of ____, 200__.

MIRAMAR LABS, INC.
a Delaware Corporation

        
By:    Mark Deem
Title: President and Chief Executive Officer

-8-

EXHIBIT A
NOTICE OF EXERCISE

		
	TO:
	Miramar Labs, Inc.

199 Jefferson Drive
Menlo Park, CA 94025
Attention: President
1.    The undersigned hereby elects to purchase __________ shares of Series A Preferred Stock pursuant to the terms of the attached Warrant.
2.    Please issue a certificate or certificates representing said Shares in the name of the undersigned or in such other name as is specified below:
_________________________________
(Name)
_________________________________
(Address)
3.    The undersigned hereby represents and warrants that the aforesaid Shares are being acquired for the account of the undersigned for investment and not with a view to, or for resale, in connection with the distribution thereof, and that the undersigned has no present intention of distributing or reselling such shares and all representations and warranties of the undersigned set forth in Section 9 of the attached Warrant (including Section 9 (e) thereof) are true and correct as of the date hereof.
______________________________
(Signature)
______________________________
(Name)
		
	______________________________
	______________________________ 

		
	(Date)
	(Title)

                

    

EXHIBIT D 
 
IP RIGHTS

	
						
	Territory
	Patent #
	App #
	Filing Date
	Issue Date
	Description

	United States
	6,104,959
	08/904,175
	7/31/97
	8/15/00
	Method & Apparatus for treating Subcutaneous Histological Features
 – Parent Filing

	United States
	6,334,074
	09/474,969
	12/29/99
	12/25/01
	Microwave Applicator for Therapeutic Use

	United States
	NA
	09/637,923
	8/14/00
	NA
	Divisional of 08/904,175

	Australia
	84915/98
	PCT/US98/14737
	2/28/00
	2/21/02
	Method & Apparatus for treating Subcutaneous Histological Features

	Canada
	NA
	2298680
	1/31/00
	NA
	Method & Apparatus for treating Subcutaneous Histological Features

	Europe
	NA
	1998935729
	2/11/00
	NA
	Method & Apparatus for treating Subcutaneous Histological Features

D-1

EXHIBIT E
PATENT RIGHTS ASSIGNMENT
WHEREAS, Jan Wallace, an individual (“Assignor”) owns all, right, title, and interest in and to the inventions and improvements claimed patents and patent applications specified on the attached Schedule I (collectively, the “Patent Rights”); and
WHEREAS, Miramar Labs, Inc., a Delaware corporation (the “Assignee”) wants to acquire all interest in the inventions and the Patent Rights including any patents or registrations that may arise therefrom (collectively, “Letters Patents and Registrations”);
For good and valuable consideration, receipt of which is hereby acknowledged by Assignor, Assignor has assigned, and does assign to Assignee all right, title and interest in and to the inventions claimed in the and the Patent Rights and to all foreign counterparts (including patent, utility model and industrial designs), and in and to any Letters Patent and Registrations which may hereafter be granted on the same in the United States and all countries throughout the world, and to claim the priority from the applications as provided by the Paris Convention.  The right, title and interest is to be held and enjoyed by Assignee and Assignee’s successors and assigns as fully and exclusively as it would have been held and enjoyed by Assignor had this assignment not been made, for the full term of any Letters Patent and Registrations which may be granted thereon, or of any and all substitutions, extensions, confirmations, reissues, divisions, re‐examinations, renewals and extensions thereof.
Assignor further agrees that Assignor will, without charge to Assignee, but at Assignee’s expense, (a) cooperate with Assignee in the prosecution of the Patent Rights and foreign counterparts thereof, (b) execute, verify, acknowledge and deliver all such further papers and instruments of transfer and (c) perform such other acts as Assignee lawfully may request to obtain or maintain Letters Patent and Registrations for the invention and improvements in any and all countries, and to vest title thereto in Assignee, or Assignee’s successors and assigns.
Buyer agrees that if within five (5) years from the date of this Assignment it has not utilized or marketed the microwave therapy system to produce sales revenue then, if such delay is not caused by any action or inaction of the Seller, the Patent Rights shall revert to the Seller. Buyer agrees to execute any and all documentation required to return ownership of the all Patent rights under this Assignment. Seller shall notify the Buyer in writing of the right to revision.

[The remainder of this page left blank intentionally; signature page follows.]

E-1

IN TESTIMONY WHEREOF, this Assignment is executed this 18th day of January, 2008.

	
		
	“ASSIGNEE”

	 

	MIRAMAR LABS, INC.

	By:
	/s/ Mark Deem

	Name:
	Mark Deem

	Title:
	CEO

	 
	 

	“ASSIGNOR”

	 

	JAN WALLACE

	By:
	/s/ Jan Wallace

	Name:
	Jan Wallace

E-2

EXHIBIT F

DISCLOSURE SCHEDULE

F-1

Exhibit F
There are no further disclosures other than those listed in the Asset Purchase Agreement.

EXHIBIT G

SELLER’S EXPENSES

G-1Exhibit

LOAN AND SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT (as the same may from time to time be amended, modified, supplemented or restated, this “Agreement”) dated as of August 7, 2015 (the “Effective Date”) among OXFORD FINANCE LLC, a Delaware limited liability company with an office located at 133 North Fairfax Street, Alexandria, Virginia 22314 (“Oxford”), as collateral agent (in such capacity, “Collateral Agent”), the Lenders listed on Schedule 1.1 hereof or otherwise a party hereto from time to time including Oxford in its capacity as a Lender and SILICON VALLEY BANK, a California corporation with an office located at 3003 Tasman Drive, Santa Clara, CA 95054 (“Bank” or “SVB”) (each a “Lender” and collectively, the “Lenders”), and MIRAMAR LABS, INC., a Delaware Corporation with offices located at 2790 Walsh Ave., Santa Clara, CA 95051 (“Borrower”), provides the terms on which the Lenders shall lend to Borrower and Borrower shall repay the Lenders.  The parties agree as follows:
1.ACCOUNTING AND OTHER TERMS
1.1    Accounting terms not defined in this Agreement shall be construed in accordance with GAAP.  Calculations and determinations must be made in accordance with GAAP.  Capitalized terms not otherwise defined in this Agreement shall have the meanings set forth in Section 13.  All other terms contained in this Agreement, unless otherwise indicated, shall have the meaning provided by the Code to the extent such terms are defined therein.  All references to “Dollars” or “$” are United States Dollars, unless otherwise noted.
2.    LOANS AND TERMS OF PAYMENT
2.1    Promise to Pay.  Borrower hereby unconditionally promises to pay each Lender, the outstanding principal amount of all Term Loans advanced to Borrower by such Lender and accrued and unpaid interest thereon and any other amounts due hereunder as and when due in accordance with this Agreement.
2.2    Term Loans.
(a)    Availability.  (i) Subject to the terms and conditions of this Agreement, the Lenders agree, severally and not jointly, to make a term loan to Borrower on the Effective Date in an aggregate amount equal to Ten Million Dollars ($10,000,000.00) according to each Lender’s Term A Loan Commitment as set forth on Schedule 1.1 hereto (such term loans are hereinafter referred to as the “Term A Loan”).  After repayment, the Term A Loan may not be re-borrowed.
(ii)    Subject to the terms and conditions of this Agreement, the Lenders agree, severally and not jointly, during the Second Draw Period, to make a term loan to Borrower in an aggregate amount equal to Five Million Dollars ($5,000,000.00) according to each Lender’s Term B Loan Commitment as set forth on Schedule 1.1 hereto (such term loans are hereinafter referred to as the “Term B Loan”).  After repayment, the Term B Loan may not be re-borrowed.
(iii)    Subject to the terms and conditions of this Agreement, the Lenders agree, severally and not jointly, during the Third Draw Period, to make a term loan to Borrower in an aggregate amount equal to Five Million Dollars ($5,000,000.00) according to each Lender’s Term C Loan Commitment as set forth on Schedule 1.1 hereto (such term loans are hereinafter referred to as the “Term C Loan”, and together with the Term A Loan and the Term B Loan, each is hereinafter referred to singly as a “Term Loan” and, collectively, as the “Term Loans”).  After repayment, no Term C Loan may be re-borrowed.

-1-

(b)    Repayment.  Borrower shall make monthly payments of interest only commencing on the first (1st) Payment Date following the Funding Date of each Term Loan, and continuing on the Payment Date of each successive month thereafter through and including the Payment Date immediately preceding the Amortization Date.  Borrower agrees to pay, on the Funding Date of each Term Loan, any initial partial monthly interest payment otherwise due for the period between the Funding Date of such Term Loan and the first Payment Date thereof.  Commencing on the Amortization Date, and continuing on the Payment Date of each month thereafter, Borrower shall make consecutive equal monthly payments of principal and interest, in arrears, to each Lender, as calculated by Collateral Agent (which calculations shall be deemed correct absent manifest error) based upon: (1) the amount of such Lender’s Term Loan, (2) the effective rate of interest, as determined in Section 2.3(a), and (3) a repayment schedule equal to (x) thirty-three (33) months, if the Amortization Date is January 1, 2017; or (y) twenty-seven (27) months, if the Amortization Date is July 1, 2017.  All unpaid principal and accrued and unpaid interest with respect to each Term Loan is due and payable in full on the Maturity Date.  Each Term Loan may only be prepaid in accordance with Sections 2.2(c) and 2.2(d).
(c)    Mandatory Prepayments.  If the Term Loans are accelerated following the occurrence and during the continuance of an Event of Default, Borrower shall immediately pay to Lenders, payable to each Lender in accordance with its respective Pro Rata Share, an amount equal to the sum of: (i) all outstanding principal of the Term Loans plus accrued and unpaid interest thereon through the prepayment date, (ii) the Final Payment, (iii) the Prepayment Fee, plus (iv) all other Obligations that are due and payable, including Lenders’ Expenses and interest at the Default Rate with respect to any past due amounts.  Notwithstanding (but without duplication with) the foregoing, on the Maturity Date, if the Final Payment had not previously been paid in full in connection with the prepayment of the Term Loans in full, Borrower shall pay to Collateral Agent, for payment to each Lender in accordance with its respective Pro Rata Share, the Final Payment in respect of the Term Loan(s).
(d)    Permitted Prepayment of Term Loans.  Borrower shall have the option to prepay all, but not less than all, of the Term Loans advanced by the Lenders under this Agreement, provided Borrower (i) provides written notice to Collateral Agent of its election to prepay the Term Loans at least fifteen (15) days prior to such prepayment, and (ii) pays to the Lenders on the date of such prepayment, payable to each Lender in accordance with its respective Pro Rata Share, an amount equal to the sum of (A) all outstanding principal of the Term Loans plus accrued and unpaid interest thereon through the prepayment date, (B) the Final Payment, (C) the Prepayment Fee, plus (D) all other Obligations that are due and payable, including Lenders’ Expenses and interest at the Default Rate with respect to any past due amounts.
2.3    Payment of Interest on the Credit Extensions.
(a)    Interest Rate.  Subject to Section 2.3(b), the principal amount outstanding under the Term Loans shall accrue interest at a fixed per annum rate (which rate shall be fixed for the duration of the applicable Term Loan) equal to the Basic Rate, determined by Collateral Agent on the Funding Date of the applicable Term Loan, which interest shall be payable monthly in arrears in accordance with Sections 2.2(b) and 2.3(e).  Interest shall accrue on each Term Loan commencing on, and including, the Funding Date of such Term Loan, and shall accrue on the principal amount outstanding under such Term Loan through and including the day on which such Term Loan is paid in full.
(b)    Default Rate.  Immediately upon the occurrence and during the continuance of an Event of Default, Obligations shall accrue interest at a fixed per annum rate equal to the rate that is otherwise applicable thereto plus five percentage points (5.00%) (the “Default Rate”).  Payment or acceptance of the increased interest 

-2-

rate provided in this Section 2.3(b) is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of Collateral Agent.
(c)    360-Day Year.  Interest shall be computed on the basis of a three hundred sixty (360) day year consisting of twelve (12) months of thirty (30) days.
(d)    Debit of Accounts.  Collateral Agent and each Lender may debit (or ACH) any deposit accounts, maintained by Borrower or any of its Subsidiaries, including the Designated Deposit Account, for principal and interest payments or any other amounts Borrower owes the Lenders under the Loan Documents when due.  Any such debits (or ACH activity) shall not constitute a set-off.
(e)    Payments.  Except as otherwise expressly provided herein, all payments by Borrower under the Loan Documents shall be made to the respective Lender to which such payments are owed, at such Lender’s office in immediately available funds on the date specified herein.  Unless otherwise provided, interest is payable monthly on the Payment Date of each month.  Payments of principal and/or interest received after 12:00 noon Eastern time are considered received at the opening of business on the next Business Day.  When a payment is due on a day that is not a Business Day, the payment is due the next Business Day and additional fees or interest, as applicable, shall continue to accrue until paid.  All payments to be made by Borrower hereunder or under any other Loan Document, including payments of principal and interest, and all fees, expenses, indemnities and reimbursements, shall be made without set-off, recoupment or counterclaim, in lawful money of the United States and in immediately available funds.
2.4    Secured Promissory Notes.  The Term Loans shall be evidenced by a Secured Promissory Note or Notes in the form attached as Exhibit D hereto (each a “Secured Promissory Note”), and shall be repayable as set forth in this Agreement.  Borrower irrevocably authorizes each Lender to make or cause to be made, on or about the Funding Date of any Term Loan or at the time of receipt of any payment of principal on such Lender’s Secured Promissory Note, an appropriate notation on such Lender’s Secured Promissory Note Record reflecting the making of such Term Loan or (as the case may be) the receipt of such payment.  The outstanding amount of each Term Loan set forth on such Lender’s Secured Promissory Note Record shall be prima facie evidence of the principal amount thereof owing and unpaid to such Lender, but the failure to record, or any error in so recording, any such amount on such Lender’s Secured Promissory Note Record shall not limit or otherwise affect the obligations of Borrower under any Secured Promissory Note or any other Loan Document to make payments of principal of or interest on any Secured Promissory Note when due.  Upon receipt of an affidavit of an officer of a Lender as to the loss, theft, destruction, or mutilation of its Secured Promissory Note, Borrower shall issue, in lieu thereof, a replacement Secured Promissory Note in the same principal amount thereof and of like tenor.
2.5    Fees.  Borrower shall pay to Collateral Agent:
(a)    Facility Fee.  [waived];
(b)    Final Payment.  The Final Payment, when due hereunder, to be shared between the Lenders in accordance with their respective Pro Rata Shares;
(c)    Prepayment Fee.  The Prepayment Fee, when due hereunder, to be shared between the Lenders in accordance with their respective Pro Rata Shares;
(d)    Lenders’ Expenses.  All Lenders’ Expenses (including reasonable attorneys’ fees and expenses for documentation and negotiation of this Agreement) incurred through and after the Effective Date, when due.

-3-

2.6    Withholding.  Payments received by the Lenders from Borrower hereunder will be made free and clear of and without deduction for any and all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any governmental authority (including any interest, additions to tax or penalties applicable thereto).  Specifically, however, if at any time any Governmental Authority, applicable law, regulation or international agreement requires Borrower to make any withholding or deduction from any such payment or other sum payable hereunder to the Lenders, Borrower hereby covenants and agrees that the amount due from Borrower with respect to such payment or other sum payable hereunder will be increased to the extent necessary to ensure that, after the making of such required withholding or deduction, each Lender receives a net sum equal to the sum which it would have received had no withholding or deduction been required and Borrower shall pay the full amount withheld or deducted to the relevant Governmental Authority.  Borrower will, upon request, furnish the Lenders with proof reasonably satisfactory to the Lenders indicating that Borrower has made such withholding payment; provided, however, that Borrower need not make any withholding payment if the amount or validity of such withholding payment is contested in good faith by appropriate and timely proceedings and as to which payment in full is bonded or reserved against by Borrower.  The agreements and obligations of Borrower contained in this Section 2.6 shall survive the termination of this Agreement.
3.    CONDITIONS OF LOANS
3.1    Conditions Precedent to Initial Credit Extension.  Each Lender’s obligation to make a Term A Loan is subject to the condition precedent that Collateral Agent and each Lender shall consent to or shall have received, in form and substance satisfactory to Collateral Agent and each Lender, such documents, and completion of such other matters, as Collateral Agent and each Lender may reasonably deem necessary or appropriate, including, without limitation:
(a)    original Loan Documents, each duly executed by Borrower and each Subsidiary, as applicable;
(b)    duly executed original Control Agreements with respect to any Collateral Accounts maintained by Borrower or any of its domestic Subsidiaries;
(c)    duly executed original Secured Promissory Notes in favor of each Lender according to its Term A Loan Commitment Percentage;
(d)    the Operating Documents and good standing certificates of Borrower certified by the Secretary of State (or equivalent agency) of Borrower’s jurisdiction of organization and each jurisdiction in which Borrower is qualified to conduct business, each as of a date no earlier than thirty (30) days prior to the Effective Date;
(e)    a completed Perfection Certificate for Borrower and each of its Subsidiaries;
(f)    the Annual Projections, for the current calendar year;
(g)    duly executed original officer’s certificate for Borrower and each Subsidiary that is a party to the Loan Documents, in a form acceptable to Collateral Agent and the Lenders;
(h)    certified copies, dated as of date no earlier than thirty (30) days prior to the Effective Date, of financing statement searches, as Collateral Agent shall request, accompanied by written evidence (including any UCC termination statements) that the Liens indicated in any such financing statements either 

-4-

constitute Permitted Liens or have been or, in connection with the initial Credit Extension, will be terminated or released;
(i)    a landlord’s consent executed in favor of Collateral Agent in respect of all of Borrower’s and each Subsidiaries’ leased locations;
(j)    a bailee waiver executed in favor of Collateral Agent in respect of each third party bailee where Borrower or any Subsidiary maintains Collateral having a book value in excess of One Hundred Thousand Dollars ($100,000.00);
(k)    a duly executed legal opinion of counsel to Borrower dated as of the Effective Date;
(l)    a payoff letter from Oxford Finance LLC, in its capacity as collateral agent in respect of the Existing Indebtedness;
(m)    evidence that (i) the Liens securing the Existing Indebtedness and (ii) the documents and/or filings evidencing the perfection of such Liens (except to the extent Collateral Agent agrees that such filings or documents are to remain in place after the Effective Date), including without limitation any financing statements and/or control agreements, in each case, have or will, prior to or concurrently with the initial Credit Extension, be terminated;
(n)    evidence satisfactory to Collateral Agent and the Lenders that the insurance policies required by Section 6.5 hereof are in full force and effect, together with appropriate evidence showing loss payable and/or additional insured clauses or endorsements in favor of Collateral Agent, for the ratable benefit of the Lenders;
(o)    a copy of any applicable Registration Rights Agreement or Investors’ Rights Agreement and any amendments thereto; and
(p)    payment of the fees and Lenders’ Expenses then due as specified in Section 2.5 hereof.
3.2    Conditions Precedent to all Credit Extensions.  The obligation of each Lender to make each Credit Extension, including the initial Credit Extension, is subject to the following conditions precedent:
(a)    receipt by (i) the Lenders of an executed Disbursement Letter in the form of Exhibit B‐1 attached hereto; and (ii) SVB of an executed Loan Payment/Advance Request Form in the form of Exhibit B‐2 attached hereto;
(b)    the representations and warranties in Section 5 hereof shall be true, accurate and complete in all material respects on the date of the Disbursement Letter (and the Loan Payment/Advance Request Form) and on the Funding Date of each Credit Extension; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date, and no Event of Default shall have occurred and be continuing or result from the Credit Extension.  Each Credit Extension is Borrower’s representation and warranty on that date that the representations and warranties in Section 5 hereof are true, accurate and complete in all material respects; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text 

-5-

thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date;
(c)    in such Lender’s sole discretion, there has not been any Material Adverse Change or any material adverse deviation by Borrower from the Annual Projections of Borrower presented to and accepted by Collateral Agent and each Lender;
(d)    to the extent not delivered at the Effective Date, duly executed original Secured Promissory Notes and Warrants, substantially in the form delivered as of the Effective Date and in favor of each Lender according to its Commitment Percentage, with respect to each Credit Extension made by such Lender after the Effective Date; and
(e)    payment of the fees and Lenders’ Expenses then due as specified in Section 2.5 hereof.
3.3    Covenant to Deliver.  Borrower agrees to deliver to Collateral Agent and the Lenders each item required to be delivered to Collateral Agent under this Agreement as a condition precedent to any Credit Extension.  Borrower expressly agrees that a Credit Extension made prior to the receipt by Collateral Agent or any Lender of any such item shall not constitute a waiver by Collateral Agent or any Lender of Borrower’s obligation to deliver such item, and any such Credit Extension in the absence of a required item shall be made in each Lender’s sole discretion.
3.4    Procedures for Borrowing.  Subject to the prior satisfaction of all other applicable conditions to the making of a Term Loan set forth in this Agreement, to obtain a Term Loan, Borrower shall notify the Lenders (which notice shall be irrevocable) by electronic mail, facsimile, or telephone by 12:00 noon Eastern time three (3) Business Days prior to the date the Term Loan is to be made.  Together with any such electronic, facsimile or telephonic notification, Borrower shall deliver to the Lenders by electronic mail or facsimile a completed Disbursement Letter (and the Loan Payment/Advance Request Form, with respect to SVB) executed by a Responsible Officer or his or her designee.  The Lenders may rely on any telephone notice given by a person whom a Lender reasonably believes is a Responsible Officer or designee.  On the Funding Date, each Lender shall credit and/or transfer (as applicable) to the Designated Deposit Account, an amount equal to its Term Loan Commitment.
4.    CREATION OF SECURITY INTEREST
4.1    Grant of Security Interest.  Borrower hereby grants Collateral Agent, for the ratable benefit of the Lenders, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Collateral Agent, for the ratable benefit of the Lenders, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and products thereof.  Borrower represents, warrants, and covenants that the security interest granted herein is and shall at all times continue to be a first priority perfected security interest in the Collateral, subject only to Permitted Liens that are permitted by the terms of this Agreement to have priority to Collateral Agent’s Lien.  If Borrower shall acquire commercial tort claims (as defined in the Code) having a value in excess of One Hundred Thousand Dollars ($100,000.00) individually or Two Hundred Fifty Thousand Dollars ($250,000.00) in the aggregate, Borrower, shall promptly notify Collateral Agent in a writing signed by Borrower, as the case may be, of the general details thereof (and further details as may be required by Collateral Agent) and grant to Collateral Agent, for the ratable benefit of the Lenders, in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to Collateral Agent.

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Borrower acknowledges that it previously has entered, and/or may in the future enter, into Bank Services Agreements with Bank.  Regardless of the terms of any Bank Services Agreement, Borrower agrees that any amounts Borrower owes Bank thereunder shall be deemed to be Obligations hereunder and that it is the intent of Borrower and Bank to have all such Obligations secured by the first priority perfected security interest in the Collateral granted herein (subject only to Permitted Liens that may have superior priority to Collateral Agent’s Lien in this Agreement).
If this Agreement is terminated, Collateral Agent’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations) are repaid in full in cash.  Upon payment in full in cash of the Obligations (other than inchoate indemnity obligations) and at such time as the Lenders’ obligation to make Credit Extensions has terminated, Collateral Agent shall, at the sole cost and expense of Borrower, release its Liens in the Collateral and all rights therein shall revert to Borrower.  In the event (x) all Obligations (other than inchoate indemnity obligations), except for Bank Services, are satisfied in full, and (y) this Agreement is terminated, Collateral Agent shall terminate the security interest granted herein upon Borrower providing cash collateral acceptable to Bank in its good faith business judgment consistent with Bank’s then current practice for Bank Services, if any.  In the event such Bank Services consist of outstanding Letters of Credit, Borrower shall provide to Bank cash collateral in an amount equal to (x) if such Letters of Credit are denominated in Dollars, then one hundred five percent (105%); and (y) if such Letters of Credit are denominated in a Foreign Currency, then one hundred ten percent (110%), of the Dollar Equivalent of the face amount of all such Letters of Credit plus all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its good faith business judgment), to secure all of the Obligations relating to such Letters of Credit.
4.2    Authorization to File Financing Statements.  Borrower hereby authorizes Collateral Agent to file financing statements or take any other action required to perfect Collateral Agent’s security interests in the Collateral, without notice to Borrower, with all appropriate jurisdictions to perfect or protect Collateral Agent’s interest or rights under the Loan Documents, including a notice that any disposition of the Collateral, except to the extent permitted by the terms of this Agreement, by Borrower, or any other Person, shall be deemed to violate the rights of Collateral Agent under the Code.
4.3    Pledge of Collateral.  Borrower hereby pledges, assigns and grants to Collateral Agent, for the ratable benefit of the Lenders, a security interest in all the Shares, together with all proceeds and substitutions thereof, all cash, stock and other moneys and property paid thereon, all rights to subscribe for securities declared or granted in connection therewith, and all other cash and noncash proceeds of the foregoing, as security for the performance of the Obligations.  On the Effective Date, or, to the extent not certificated as of the Effective Date, within ten (10) days of the certification of any Shares, the certificate or certificates for the Shares will be delivered to Collateral Agent, accompanied by an instrument of assignment duly executed in blank by Borrower.  To the extent required by the terms and conditions governing the Shares, Borrower shall cause the books of each entity whose Shares are part of the Collateral and any transfer agent to reflect the pledge of the Shares.  Upon the occurrence and during the continuance of an Event of Default hereunder, Collateral Agent may effect the transfer of any securities included in the Collateral (including but not limited to the Shares) into the name of Collateral Agent and cause new (as applicable) certificates representing such securities to be issued in the name of Collateral Agent or its transferee.  Borrower will execute and deliver such documents, and take or cause to be taken such actions, as Collateral Agent may reasonably request to perfect or continue the perfection of Collateral Agent’s security interest in the Shares.  Unless an Event of Default shall have occurred and be continuing, Borrower shall be entitled to exercise any voting rights with respect to the Shares and to give consents, waivers and ratifications in respect thereof, provided that no vote shall be cast or consent, waiver or ratification given or action taken which would be inconsistent with any of the terms of this Agreement or which would constitute or create any 

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violation of any of such terms.  All such rights to vote and give consents, waivers and ratifications shall terminate upon the occurrence and continuance of an Event of Default.
5.    REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to Collateral Agent and the Lenders as follows:
5.1    Due Organization, Authorization: Power and Authority.  Borrower and each of its Subsidiaries is duly existing and in good standing as a Registered Organization in its jurisdictions of organization or formation and Borrower and each of its Subsidiaries is qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of its businesses or its ownership of property requires that it be qualified except where the failure to do so could not reasonably be expected to have a Material Adverse Change.  In connection with this Agreement, Borrower and each of its Subsidiaries has delivered to Collateral Agent a completed perfection certificate signed by an officer of Borrower or such Subsidiary (each a “Perfection Certificate” and collectively, the “Perfection Certificates”).  Borrower represents and warrants that (a) Borrower and each of its Subsidiaries’ exact legal name is that which is indicated on its respective Perfection Certificate and on the signature page of each Loan Document to which it is a party; (b) Borrower and each of its Subsidiaries is an organization of the type and is organized in the jurisdiction set forth on its respective Perfection Certificate; (c) such Perfection Certificate accurately sets forth each of Borrower’s and its Subsidiaries’ organizational identification number or accurately states that Borrower or such Subsidiary has none; (d) each Perfection Certificate accurately sets forth Borrower’s and each of its Subsidiaries’ place of business, or, if more than one, its chief executive office as well as Borrower’s and each of its Subsidiaries’ mailing address (if different than its chief executive office); (e) except as set forth in such Perfection Certificate, Borrower and each of its Subsidiaries (and each of its respective predecessors) have not, in the past five (5) years, changed its jurisdiction of organization, organizational structure or type, or any organizational number assigned by its jurisdiction; and (f) all other information set forth on the Perfection Certificates pertaining to Borrower and each of its Subsidiaries, is accurate and complete in all material respects (it being understood and agreed that Borrower and each of its Subsidiaries may from time to time update certain information in the Perfection Certificates (including the information set forth in clause (d) above) after the Effective Date to the extent such information is permitted to be updated by one or more specific provisions in this Agreement); such updated Perfection Certificates subject to the review and approval of Collateral Agent.  If Borrower or any of its Subsidiaries is not now a Registered Organization but later becomes one, Borrower shall notify Collateral Agent of such occurrence and provide Collateral Agent with such Person’s organizational identification number within five (5) Business Days of receiving such organizational identification number.
The execution, delivery and performance by Borrower and each of its Subsidiaries of the Loan Documents to which it is a party have been duly authorized, and do not (i) conflict with any of Borrower’s or such Subsidiaries’ organizational documents, including its respective Operating Documents, (ii) contravene, conflict with, constitute a default under or violate any material Requirement of Law applicable thereto, (iii) contravene, conflict or violate any applicable order, writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or such Subsidiary, or any of their property or assets may be bound or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full force and effect) or are being obtained pursuant to Section 6.1(b), or (v) constitute an event of default under any material agreement by which Borrower or any of such Subsidiaries, or their respective properties, is bound.  Neither Borrower nor any of its Subsidiaries is in default under any agreement to which it is a party or by which it or any of its assets is bound in which such default could reasonably be expected to have a Material Adverse Change.

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5.2    Collateral.
(e)    Borrower and each its Subsidiaries have good title to, have rights in, and the power to transfer each item of the Collateral upon which it purports to grant a Lien under the Loan Documents, free and clear of any and all Liens except Permitted Liens, and neither Borrower nor any of its Subsidiaries have any Deposit Accounts, Securities Accounts, Commodity Accounts or other investment accounts other than the Collateral Accounts or the other investment accounts, if any, described in the Perfection Certificates delivered to Collateral Agent in connection herewith with respect of which Borrower or such Subsidiary has given Collateral Agent notice and taken such actions as are necessary to give Collateral Agent a perfected security interest therein to the extent required under Section 6.6.  The Accounts are bona fide, existing obligations of the Account Debtors.
(f)    On the Effective Date, and except as disclosed on the Perfection Certificate (i) the Collateral is not in the possession of any third party bailee (such as a warehouse), and (ii) no such third party bailee possesses components of the Collateral in excess of One Hundred Thousand Dollars ($100,000.00).  None of the components of the Collateral shall be maintained at locations other than as disclosed in the Perfection Certificates on the Effective Date or as permitted pursuant to Section 6.11.
(g)    All Inventory is in all material respects of good and marketable quality, free from material defects.
(h)    Borrower and each of its Subsidiaries is the sole owner of the Intellectual Property each respectively purports to own, free and clear of all Liens other than Permitted Liens.  Except as noted on the Perfection Certificates, neither Borrower nor any of its Subsidiaries is a party to, nor is bound by, any material license or other material agreement with respect to which Borrower or such Subsidiary is the licensee that (i) prohibits or otherwise restricts Borrower or its Subsidiaries from granting a security interest in Borrower’s or such Subsidiaries’ interest in such material license or material agreement or any other property, or (ii) for which a default under or termination of could interfere with Collateral Agent’s or any Lender’s right to sell any Collateral.  Borrower shall provide written notice to Collateral Agent and each Lender within ten (10) days of Borrower or any of its Subsidiaries entering into or becoming bound by any license or agreement with respect to which Borrower or any Subsidiary is the licensee (other than over-the-counter software that is commercially available to the public).
5.3    Litigation.  Except as disclosed (i) on the Perfection Certificates, or (ii) in accordance with Section 6.9 hereof, there are no actions, suits, investigations (subject to attorney-client privilege), or proceedings pending or, to the knowledge of the Responsible Officers, threatened in writing by or against Borrower or any of its Subsidiaries involving more than Two Hundred Fifty Thousand Dollars ($250,000.00).
5.4    No Material Deterioration in Financial Condition; Financial Statements.  All consolidated financial statements for Borrower and its Subsidiaries, delivered to Collateral Agent fairly present, in conformity with GAAP, in all material respects the consolidated financial condition of Borrower and its Subsidiaries, and the consolidated results of operations of Borrower and its Subsidiaries as of the dates and for the periods presented (subject, in the case of unaudited financial statements, to normal year-end adjustments and the absence of footnotes).  There has not been any material deterioration in the consolidated financial condition of Borrower and its Subsidiaries since the date of the most recent financial statements submitted to any Lender.
5.5    Solvency.  Borrower is Solvent and Borrower and each of its Subsidiaries, on a consolidated basis, are Solvent.

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5.6    Regulatory Compliance.  Neither Borrower nor any of its Subsidiaries is an “investment company” or a company “controlled” by an “investment company” under the Investment Company Act of 1940, as amended.  Neither Borrower nor any of its Subsidiaries is engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors).  Borrower and each of its Subsidiaries has complied in all material respects with the Federal Fair Labor Standards Act.  Neither Borrower nor any of its Subsidiaries is a “holding company” or an “affiliate” of a “holding company” or a “subsidiary company” of a “holding company” as each term is defined and used in the Public Utility Holding Company Act of 2005.  Neither Borrower nor any of its Subsidiaries has violated any laws, ordinances or rules, the violation of which could reasonably be expected to have a Material Adverse Change.  Neither Borrower’s nor any of its Subsidiaries’ properties or assets has been used by Borrower or such Subsidiary or, to Borrower’s knowledge, by previous Persons, in disposing, producing, storing, treating, or transporting any hazardous substance other than in material compliance with applicable laws.  Borrower and each of its Subsidiaries has obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all Governmental Authorities that are necessary to continue their respective businesses as currently conducted, except where the failure to obtain any such consent, approval or authorization to make any such declaration of filing or give such notice could not reasonably be expected to have a Material Adverse Change.
None of Borrower, any of its Subsidiaries, or any of Borrower’s or its Subsidiaries’ Affiliates or any of their respective agents acting or benefiting in any capacity in connection with the transactions contemplated by this Agreement is (i) in violation of any Anti-Terrorism Law, (ii) engaging in or conspiring to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law, or (iii) is a Blocked Person.  None of Borrower, any of its Subsidiaries, or to the knowledge of Borrower and any of their Affiliates or agents, acting or benefiting in any capacity in connection with the transactions contemplated by this Agreement, (x) conducts any business or engages in making or receiving any contribution of funds, goods or services to or for the benefit of any Blocked Person, or (y) deals in, or otherwise engages in any transaction relating to, any property or interest in property blocked pursuant to Executive Order No. 13224, any similar executive order or other Anti-Terrorism Law.
5.7    Investments.  Neither Borrower nor any of its Subsidiaries owns any stock, shares, partnership interests or other equity securities except for Permitted Investments.
5.8    Tax Returns and Payments; Pension Contributions.  Borrower and each of its Subsidiaries has timely filed all required tax returns and reports, and Borrower and each of its Subsidiaries, has timely paid all foreign, federal, state, and local taxes, assessments, deposits and contributions owed by Borrower and such Subsidiaries, in all jurisdictions in which Borrower or any such Subsidiary is subject to taxes, including the United States, unless such taxes are being contested in accordance with the following sentence.  Borrower and each of its Subsidiaries, may defer payment of any contested taxes, provided that Borrower or such Subsidiary, (a) in good faith contests its obligation to pay the taxes by appropriate proceedings promptly and diligently instituted and conducted, (b) notifies Collateral Agent in writing of the commencement of, and any material development in, the proceedings, and (c) posts bonds or takes any other steps required to prevent the Governmental Authority levying such contested taxes from obtaining a Lien upon any of the Collateral that is other than a “Permitted Lien.” Neither Borrower nor any of its Subsidiaries is aware of any claims or adjustments proposed for any of Borrower’s or such Subsidiaries’, prior tax years which could result in additional taxes becoming due and payable by Borrower or its Subsidiaries.  Borrower and each of its Subsidiaries have paid all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms, and neither Borrower nor any of its Subsidiaries have, withdrawn from participation in, and have not permitted partial or complete termination of, or permitted the occurrence of any other event with respect to, any such plan which could reasonably be expected to result in any liability of Borrower or its Subsidiaries, including 

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any liability to the Pension Benefit Guaranty Corporation or its successors or any other Governmental Authority.  Notwithstanding anything to the contrary contained in this Agreement, Borrower shall not be in breach of this Section 5.8 unless the aggregate amount of taxes covered by tax returns and reports that have not been timely filed or the aggregate amount of taxes that have not been timely paid in either case exceeds Twenty Five Thousand Dollars ($25,000.00).
5.9    Use of Proceeds.  Borrower shall use the proceeds of the Credit Extensions solely as working capital and to fund its general business requirements in accordance with the provisions of this Agreement, and not for personal, family, household or agricultural purposes.  A portion of the proceeds of the Term A Loans shall be used by Borrower to repay the Existing Indebtedness in full on the Effective Date.
5.10    Shares.  Borrower has full power and authority to create a first lien on the Shares and no disability or contractual obligation exists that would prohibit Borrower from pledging the Shares pursuant to this Agreement.  To Borrower’s knowledge, there are no subscriptions, warrants, rights of first refusal or other restrictions on transfer relative to, or options exercisable with respect to the Shares.  The Shares have been and will be duly authorized and validly issued, and are fully paid and non-assessable.  To Borrower’s knowledge, the Shares are not the subject of any present or threatened suit, action, arbitration, administrative or other proceeding, and Borrower knows of no reasonable grounds for the institution of any such proceedings.
5.11    Full Disclosure.  No written representation, warranty or other statement of Borrower or any of its Subsidiaries in any certificate or written statement given to Collateral Agent or any Lender, as of the date such representation, warranty, or other statement was made, taken together with all such written certificates and written statements given to Collateral Agent or any Lender, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the certificates or statements not misleading (it being recognized that the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results).
5.12    Definition of “Knowledge.” For purposes of the Loan Documents, whenever a representation or warranty is made to Borrower’s knowledge or awareness, to the “best of” Borrower’s knowledge, or with a similar qualification, knowledge or awareness means the actual knowledge, after reasonable investigation, of the Responsible Officers.
6.    AFFIRMATIVE COVENANTS
Borrower shall, and shall cause each of its Subsidiaries to, do all of the following:
6.1    Government Compliance.
(a)    Except as permitted under Section 7.3, maintain its and all its Subsidiaries’ legal existence and good standing in their respective jurisdictions of organization and maintain qualification in each jurisdiction in which the failure to so qualify could reasonably be expected to have a Material Adverse Change.  Comply with all laws, ordinances and regulations to which Borrower or any of its Subsidiaries is subject, the noncompliance with which could reasonably be expected to have a Material Adverse Change.
(b)    Obtain and keep in full force and effect, all of the material Governmental Approvals necessary for the performance by Borrower and its Subsidiaries of their respective businesses and obligations under the Loan Documents (except as could not reasonably be expected to have a material adverse effect on Borrower’s business) and the grant of a security interest to Collateral Agent for the ratable benefit of the Lenders, 

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in all of the Collateral.  Borrower shall promptly provide copies to Collateral Agent of any material Governmental Approvals obtained by Borrower or any of its Subsidiaries.
6.2    Financial Statements, Reports, Certificates.
(a)    Deliver to each Lender:
(i)    as soon as available, but no later than thirty (30) days after the last day of each month, a company prepared consolidated and consolidating balance sheet, income statement and cash flow statement covering the consolidated operations of Borrower and its Subsidiaries for such month certified by a Responsible Officer and in a form reasonably acceptable to Collateral Agent;
(ii)    as soon as available, but no later than one hundred eighty (180) days after the last day of Borrower’s fiscal year or within five (5) days of filing with the SEC, audited consolidated financial statements prepared under GAAP, consistently applied, together with an unqualified opinion (except that such opinion may be qualified with respect to going concern) on the financial statements from an independent certified public accounting firm acceptable to Collateral Agent in its reasonable discretion;
(iii)    as soon as available after approval thereof by Borrower’s Board of Directors, but no later than forty-five (45) days after the last day of each of Borrower’s fiscal years, Borrower’s annual financial projections for the entire current fiscal year as approved by Borrower’s Board of Directors, which such annual financial projections shall be set forth in a month-by-month format (such annual financial projections as originally delivered to Collateral Agent and the Lenders are referred to herein as the “Annual Projections”; provided that, any revisions of the Annual Projections approved by Borrower’s Board of Directors shall be delivered to Collateral Agent and the Lenders no later than seven (7) days after such approval);
(iv)    within five (5) days of delivery, copies of all statements, reports and notices made available to Borrower’s security holders generally or holders of Subordinated Debt in their capacity as such;
(v)    in the event that Borrower becomes subject to the reporting requirements under the Securities Exchange Act of 1934, as amended, within five (5) days of filing, all reports on Form 10‐K, 10‐Q and 8‐K filed with the Securities and Exchange Commission,
(vi)    prompt notice of (i) any amendments of or other changes to the Operating Documents of Borrower or any of its Subsidiaries and (ii) any material amendment of or other change to the capitalization table of Borrower; in each case together with any copies reflecting such amendments or changes with respect thereto; and provided that Borrower shall provide Collateral Agent and Lenders the notice with respect to, and copies of, the current capitalization table no later than thirty (30) days after the end of each fiscal quarter to the extent that there have been any amendments of, or changes to, the capitalization table since the last time the same was delivered to Collateral Agent and Lenders.
(vii)    prompt notice of any event that could reasonably be expected to materially and adversely affect the value of the Intellectual Property;
(viii)    as soon as available, but no later than thirty (30) days after the last day of each month, copies of the month-end account statements for each Collateral Account maintained by Borrower or its Subsidiaries, which statements may be provided to Collateral Agent and each Lender by Borrower or directly from the applicable institution(s), and 

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(ix)    other information as reasonably requested by Collateral Agent or any Lender.
Notwithstanding the foregoing, documents required to be delivered pursuant to the terms hereof (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered the date on which Borrower notifies Collateral Agent and Lenders that the SEC has made such documents publicly available or the date on which Borrower posts such documents, or provides a link thereto, on Borrower’s website on the internet at Borrower’s website address.
(b)    Concurrently with the delivery of the financial statements specified in Section 6.2(a)(i) above but no later than thirty (30) days after the last day of each month, deliver to each Lender, a duly completed Compliance Certificate signed by a Responsible Officer.
(c)    Keep proper books of record and account in accordance with GAAP in all material respects, in which full, true and correct entries shall be made of all dealings and transactions in relation to its business and activities (subject, in the case of unaudited financial statements, to normal year-end adjustments and the absence of footnotes).  Borrower shall, and shall cause each of its Subsidiaries to, allow, at the sole cost of Borrower, Collateral Agent or any Lender, during regular business hours upon reasonable prior notice (provided that no notice shall be required when an Event of Default has occurred and is continuing), to visit and inspect any of its properties, to examine and make abstracts or copies from any of its books and records, and to conduct a collateral audit and analysis of its operations and the Collateral.  Such audits shall be conducted no more often than twice every year unless (and more frequently if) an Event of Default has occurred and is continuing.
6.3    Inventory; Returns.  Keep all Inventory in good and marketable condition, free from material defects.  Returns and allowances between Borrower, or any of its Subsidiaries, and their respective Account Debtors shall follow Borrower’s, or such Subsidiary’s, customary practices as they exist at the Effective Date.  Borrower must promptly notify Collateral Agent and the Lenders of all returns, recoveries, disputes and claims that involve more than Two Hundred Fifty Thousand Dollars ($250,000.00) individually or in the aggregate in any calendar year.
6.4    Taxes; Pensions.  Timely file and require each of its Subsidiaries to timely file, all required tax returns and reports and timely pay, and require each of its Subsidiaries to timely file, all foreign, federal, state, and local taxes, assessments, deposits and contributions owed by Borrower or its Subsidiaries, except for deferred payment of any taxes contested pursuant to the terms of Section 5.8 hereof, and shall deliver to Lenders, on demand, appropriate certificates attesting to such payments, and pay all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with the terms of such plans.  Notwithstanding anything to the contrary contained in this Agreement, Borrower shall not be in breach of this Section 6.4 unless the aggregate amount of taxes covered by tax returns and reports that have not been timely filed or the aggregate amount of taxes that have not been timely paid in either case exceeds Twenty Five Thousand Dollars ($25,000.00).
6.5    Insurance.  Keep Borrower’s and its Subsidiaries’ business and the Collateral insured for risks and in amounts standard for companies in Borrower’s and its Subsidiaries’ industry and location and as Collateral Agent may reasonably request.  Insurance policies shall be in a form, with companies, and in amounts that are reasonably satisfactory to Collateral Agent and Lenders.  All property policies shall have a lender’s loss payable endorsement showing Collateral Agent as lender loss payee and waive subrogation against Collateral Agent, and all liability policies shall show, or have endorsements showing, Collateral Agent, as additional insured.  The Collateral Agent shall be named as lender loss payee and/or additional insured with respect to any such insurance providing coverage in respect of any Collateral, and each provider of any such insurance shall agree, by 

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endorsement upon the policy or policies issued by it or by independent instruments furnished to the Collateral Agent, that it will give the Collateral Agent thirty (30) days prior written notice before any such policy or policies shall be materially altered or canceled.  At Collateral Agent’s request, Borrower shall deliver certified copies of policies and evidence of all premium payments.  Proceeds payable under any policy shall, at Collateral Agent’s option, be payable to Collateral Agent, for the ratable benefit of the Lenders, on account of the Obligations.  Notwithstanding the foregoing, (a) so long as no Event of Default has occurred and is continuing, Borrower shall have the option of applying the proceeds of any casualty policy up to One Hundred Thousand Dollars ($100,000.00) with respect to any loss, but not exceeding Two Hundred Fifty Thousand Dollars ($250,000.00), in the aggregate for all losses under all casualty policies in any one year, toward the replacement or repair of destroyed or damaged property; provided that any such replaced or repaired property (i) shall be of equal or like value as the replaced or repaired Collateral and (ii) shall be deemed Collateral in which Collateral Agent has been granted a first priority security interest, and (b) after the occurrence and during the continuance of an Event of Default, all proceeds payable under such casualty policy shall, at the option of Collateral Agent, be payable to Collateral Agent, for the ratable benefit of the Lenders, on account of the Obligations.  If Borrower or any of its Subsidiaries fails to obtain insurance as required under this Section 6.5 or to pay any amount or furnish any required proof of payment to third persons, Collateral Agent and/or any Lender may make, at Borrower’s expense, all or part of such payment or obtain such insurance policies required in this Section 6.5, and take any action under the policies Collateral Agent or such Lender deems prudent.
6.6    Operating Accounts.
(a)    Except as otherwise provided in Section 6.6(b), maintain all of Borrower’s and its Subsidiaries’ Collateral Accounts (other than the Miramar Hong Kong Account) with Bank or its Affiliates in accounts which are subject to a Control Agreement in favor of Collateral Agent and maintain all cash management services and foreign exchange services with Bank or its Affiliates.
(b)    Borrower shall provide Collateral Agent five (5) days’ prior written notice before Borrower or any of its Subsidiaries establishes any Collateral Account at or with any Person other than Bank or its Affiliates.  In addition, for each Collateral Account that Borrower or any of its Subsidiaries, at any time maintains, Borrower or such Subsidiary shall cause the applicable bank or financial institution at or with which such Collateral Account is maintained to execute and deliver a Control Agreement or other appropriate instrument with respect to such Collateral Account to perfect Collateral Agent’s Lien in such Collateral Account in accordance with the terms hereunder prior to the establishment of such Collateral Account, which Control Agreement may not be terminated without prior written consent of Collateral Agent.  The provisions of the previous sentence shall not apply to (i) deposit accounts exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of Borrower’s, or any of its Subsidiaries’, employees and identified to Collateral Agent by Borrower as such in the Perfection Certificates and (ii) the Miramar Hong Kong Account.
(c)    Neither Borrower nor any of its Subsidiaries shall maintain any Collateral Accounts except Collateral Accounts maintained in accordance with Sections 6.6(a) and (b).
6.7    Protection of Intellectual Property Rights.  Borrower and each of its Subsidiaries shall: (a) use commercially reasonable efforts to protect, defend and maintain the validity and enforceability of its Intellectual Property that is material to Borrower’s business; (b)promptly advise Collateral Agent in writing of material infringement by a third party of its Intellectual Property; and (c) not allow any Intellectual Property material to Borrower’s business to be abandoned, forfeited or dedicated to the public without Collateral Agent’s prior written consent.

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6.8    Litigation Cooperation.  Commencing on the Effective Date and continuing through the termination of this Agreement, make available to Collateral Agent and the Lenders, without expense to Collateral Agent or the Lenders, Borrower and each of Borrower’s officers, employees and agents and Borrower’s Books, to the extent that Collateral Agent or any Lender may reasonably deem them necessary to prosecute or defend any third-party suit or proceeding instituted by or against Collateral Agent or any Lender with respect to any Collateral or relating to Borrower.
6.9    Notices of Litigation and Default.  Borrower will give prompt written notice to Collateral Agent and the Lenders of any litigation or governmental proceedings pending or threatened (in writing) against Borrower or any of its Subsidiaries, which could reasonably be expected to result in damages or costs to Borrower or any of its Subsidiaries of One Hundred Thousand Dollars ($100,000.00) or more or which could reasonably be expected to have a Material Adverse Change.  Without limiting or contradicting any other more specific provision of this Agreement, promptly (and in any event within three (3) Business Days) upon Borrower becoming aware of the existence of any Event of Default or event which, with the giving of notice or passage of time, or both, would constitute an Event of Default, Borrower shall give written notice to Collateral Agent and the Lenders of such occurrence, which such notice shall include a reasonably detailed description of such Event of Default or event which, with the giving of notice or passage of time, or both, would constitute an Event of Default.
6.10    Intentionally Omitted.
6.11    Landlord Waivers; Bailee Waivers.  In the event that Borrower or any of its Subsidiaries, after the Effective Date, intends to add any new offices or business locations in the United States, including warehouses, or otherwise store any portion of the Collateral with, or deliver any portion of the Collateral to, a bailee, in each case pursuant to Section 7.2, then Borrower or such Subsidiary will first receive the written consent of Collateral Agent and, in the event that the Collateral at any new location is valued in excess of One Hundred Thousand ($100,000.00) in the aggregate, such bailee or landlord, as applicable, must execute and deliver a bailee waiver or landlord waiver, as applicable, in form and substance reasonably satisfactory to Collateral Agent prior to the addition of any new offices or business locations, or any such storage with or delivery to any such bailee, as the case may be.
6.12    Creation/Acquisition of Subsidiaries.  In the event Borrower, or any of its Subsidiaries creates or acquires any Subsidiary, Borrower shall provide prior written notice to Collateral Agent and each Lender of the creation or acquisition of such new Subsidiary, provide Collateral Agent and Lenders with a completed Perfection Certificate in respect of such Subsidiary substantially in the form of Annex I attached hereto, and take all such action as may be reasonably required by Collateral Agent or any Lender to cause each such Subsidiary to become a co-Borrower hereunder or to guarantee the Obligations of Borrower under the Loan Documents and, in each case, grant a continuing pledge and security interest in and to the assets of such Subsidiary (substantially as described on Exhibit A hereto); and Borrower (or its Subsidiary, as applicable) shall grant and pledge to Collateral Agent, for the ratable benefit of the Lenders, a perfected security interest in the Shares of each such newly created Subsidiary; provided, however, that solely in the circumstance in which Borrower or any Subsidiary creates or acquires a Foreign Subsidiary in an acquisition permitted by Section 7.7 hereof or otherwise approved by the Required Lenders, (i) such Foreign Subsidiary shall not be required to guarantee the Obligations of Borrower under the Loan Documents and grant a continuing pledge and security interest in and to the assets of such Foreign Subsidiary, and (ii) Borrower shall not be required to grant and pledge to Collateral Agent, for the ratable benefit of Lenders, a perfected security interest in more than sixty five percent (65%) of the Shares of such Foreign Subsidiary, if Borrower demonstrates to the reasonable satisfaction of Collateral Agent that such Foreign Subsidiary providing such guarantee or pledge and security interest or Borrower 

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providing a perfected security interest in more than sixty five percent (65%) of the Shares would create a present and existing adverse tax consequence to Borrower under the U.S. Internal Revenue Code.
6.13    Further Assurances.
(a)    Execute any further instruments and take further action as Collateral Agent or any Lender reasonably requests to perfect or continue Collateral Agent’s Lien in the Collateral or to effect the purposes of this Agreement.
(b)    Deliver to Collateral Agent and Lenders, within five (5) days after the same are sent or received, copies of all material correspondence, reports, documents and other filings with any Governmental Authority that could reasonably be expected to have a material adverse effect on any of the Governmental Approvals material to Borrower’s business or otherwise could reasonably be expected to have a Material Adverse Change.
7.    NEGATIVE COVENANTS
Borrower shall not, and shall not permit any of its Subsidiaries to, do any of the following without the prior written consent of the Required Lenders:
7.1    Dispositions.  Convey, sell, lease, transfer, assign, or otherwise dispose of (collectively, “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, except for Transfers (a) of Inventory in the ordinary course of business; (b) of worn out, surplus or obsolete Equipment; (c) in connection with Permitted Liens, Permitted Investments and Permitted Licenses; and (d) other property not to exceed One Hundred Thousand Dollars ($100,000.00) in the aggregate per fiscal year.
7.2    Changes in Business, Management, Ownership, or Business Locations.  (a) Engage in or permit any of its Subsidiaries to engage in any business other than the businesses engaged in by Borrower as of the Effective Date or reasonably related thereto; (b) liquidate or dissolve (unless permitted under Section 7.3); or (c) (i) any Key Person shall cease to be actively engaged in the management of Borrower unless written notice thereof is provided to Collateral Agent within five (5) days of such change, or (ii) consummate any transaction or series of related transactions in which the stockholders of Borrower who were not stockholders immediately prior to the first such transaction own more than forty nine percent (49%) of the voting stock of Borrower immediately after giving effect to such transaction or related series of such transactions (other than by the sale of Borrower’s equity securities in a public offering, a private placement of public equity or to venture capital investors so long as Borrower identifies to Collateral Agent the venture capital investors prior to the closing of the transaction).  Borrower shall not, without at least thirty (30) days’ prior written notice to Collateral Agent: (A) add any new offices or business locations, including warehouses (unless such new offices or business locations contain less than One Hundred Thousand Dollars ($100,000.00) in assets or property of Borrower or any of its Subsidiaries); (B) change its jurisdiction of organization, (C) change its organizational structure or type, (D) change its legal name, or (E) change any organizational number (if any) assigned by its jurisdiction of organization.
7.3    Mergers or Acquisitions.  Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any other Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock, shares or property of another Person, provided that a Subsidiary may merge or consolidate into another Subsidiary (provided such surviving Subsidiary is a “co-Borrower” hereunder or has provided a secured Guaranty of Borrower’s Obligations hereunder to the extent required under Section 6.12) or with (or into) Borrower provided Borrower is the surviving legal entity, and as long as no Event of Default is occurring 

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prior thereto or arises as a result therefrom.  Without limiting the foregoing, Borrower shall not, without Collateral Agent’s prior written consent, enter into any binding contractual arrangement with any Person to attempt to facilitate a merger or acquisition of Borrower, unless (i) no Event of Default exists when such agreement is entered into by Borrower, (ii) such agreement does not give such Person the right to claim any break up or similar fees, payments or damages from Borrower or any Subsidiary as a result of any failure to proceed with or close such merger or acquisition in excess of Two Hundred Fifty Thousand Dollars ($250,000.00) in the aggregate, and (iii) Borrower notifies Collateral Agent in advance of entering into such an agreement.
7.4    Indebtedness.  Create, incur, assume, or be liable for any Indebtedness, or permit any Subsidiary to do so, other than Permitted Indebtedness.
7.5    Encumbrance.  Create, incur, allow, or suffer any Lien on any of its property, or assign or convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, except for Permitted Liens, or permit any Collateral not to be subject to the first priority security interest granted herein (except for Permitted Liens that are permitted by the terms of this Agreement to have priority over Collateral Agent’s Lien), or enter into any agreement, document, instrument or other arrangement (except with or in favor of Collateral Agent, for the ratable benefit of the Lenders) with any Person which directly or indirectly prohibits or has the effect of prohibiting Borrower, or any of its Subsidiaries, from assigning, mortgaging, pledging, granting a security interest in or upon, or encumbering any of Borrower’s or such Subsidiary’s Intellectual Property, except as is otherwise permitted in Section 7.1 hereof and the definition of “Permitted Liens” herein.
7.6    Maintenance of Collateral Accounts.  Maintain any Collateral Account except pursuant to the terms of Section 6.6 hereof.
7.7    Distributions; Investments.  (a) Pay any dividends (other than dividends payable solely in capital stock or dividends payable to Borrower) or make any distribution or payment in respect of or redeem, retire or purchase any capital stock (other than (i) repurchases pursuant to the terms of employee stock purchase plans, employee restricted stock agreements, stockholder rights plans, director or consultant stock option plans, or similar plans, provided such repurchases do not exceed One Hundred Thousand Dollars ($100,000.00) in the aggregate per fiscal year), (ii) the conversion of Borrower’s convertible securities into other securities pursuant to the terms of such convertible securities or otherwise in exchange therefor and (iii) the making of cash payments in lieu of the issuance of fractional shares upon such conversion or in connection with the exercise of warrants or similar securities) or (b) directly or indirectly make any Investment other than Permitted Investments, or permit any of its Subsidiaries to do so.
7.8    Transactions with Affiliates.  Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower or any of its Subsidiaries, except for (a) transactions that are in the ordinary course of Borrower’s or such Subsidiary’s business, upon fair and reasonable terms that are no less favorable to Borrower or such Subsidiary than would be obtained in an arm’s length transaction with a non-affiliated Person, (b) Subordinated Debt or equity investments by Borrower’s investors in Borrower or its Subsidiaries, and (c) reasonable and customary fees paid to members of Borrower’s board of directors, (d) compensation arrangements and benefit plans for officers entered into or maintained in the ordinary course of business and (e) transactions by and among Borrower and its Subsidiaries consisting of Permitted Investments.
7.9    Subordinated Debt.  (a) Make or permit any payment on any Subordinated Debt, except under the terms of the subordination, intercreditor, or other similar agreement to which such Subordinated Debt is subject, or (b) amend any provision in any document relating to the Subordinated Debt which would increase 

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the amount thereof or adversely affect the subordination thereof to Obligations owed to the Lenders, except as permitted under the Subordination Agreement.
7.10    Compliance.  Become an “investment company” or a company controlled by an “investment company”, under the Investment Company Act of 1940, as amended, or undertake as one of its important activities extending credit to purchase or carry margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System), or use the proceeds of any Credit Extension for that purpose; fail to meet the minimum funding requirements of ERISA, permit a Reportable Event or Prohibited Transaction, as defined in ERISA, to occur; fail to comply with the Federal Fair Labor Standards Act or violate any other law or regulation, if the violation could reasonably be expected to have a Material Adverse Change, or permit any of its Subsidiaries to do so; withdraw or permit any Subsidiary to withdraw from participation in, permit partial or complete termination of, or permit the occurrence of any other event with respect to, any present pension, profit sharing and deferred compensation plan which could reasonably be expected to result in any liability of Borrower or any of its Subsidiaries, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other Governmental Authority.
7.11    Compliance with Anti-Terrorism Laws.  Collateral Agent hereby notifies Borrower and each of its Subsidiaries that pursuant to the requirements of Anti-Terrorism Laws, and Collateral Agent’s policies and practices, Collateral Agent is required to obtain, verify and record certain information and documentation that identifies Borrower and each of its Subsidiaries and their principals, which information includes the name and address of Borrower and each of its Subsidiaries and their principals and such other information that will allow Collateral Agent to identify such party in accordance with Anti-Terrorism Laws.  Neither Borrower nor any of its Subsidiaries shall, nor shall Borrower or any of its Subsidiaries permit any Affiliate to, directly or indirectly, knowingly enter into any documents, instruments, agreements or contracts with any Person listed on the OFAC Lists.  Borrower and each of its Subsidiaries shall immediately notify Collateral Agent if Borrower or such Subsidiary has knowledge that Borrower, or any Subsidiary or Affiliate of Borrower, is listed on the OFAC Lists or (a) is convicted on, (b) pleads nolo contendere to, (c) is indicted on, or (d) is arraigned and held over on charges involving money laundering or predicate crimes to money laundering.  Neither Borrower nor any of its Subsidiaries shall, nor shall Borrower or any of its Subsidiaries, permit any Affiliate to, directly or indirectly, (i) conduct any business or engage in any transaction or dealing with any Blocked Person, including, without limitation, the making or receiving of any contribution of funds, goods or services to or for the benefit of any Blocked Person, (ii) deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to Executive Order No. 13224 or any similar executive order or other Anti-Terrorism Law, or (iii) engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in Executive Order No. 13224 or other Anti-Terrorism Law.
7.12    Subsidiary Assets.  Permit the aggregate value of assets held by Miramar Labs HK to exceed ten percent (10%) of Borrower and its Subsidiaries total assets at any time.
8.    EVENTS OF DEFAULT
Any one of the following shall constitute an event of default (an “Event of Default”) under this Agreement:
8.1    Payment Default.  Borrower fails to (a) make any payment of principal or interest on any Credit Extension on its due date, or (b) pay any other Obligations within three (3) Business Days after such Obligations are due and payable (which three (3) Business Day grace period shall not apply to payments due on the Maturity 

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Date or the date of acceleration pursuant to Section 9.1 (a) hereof).  During the cure period, the failure to cure the payment default is not an Event of Default (but no Credit Extension will be made during the cure period);
8.2    Covenant Default.
(a)    Borrower or any of its Subsidiaries fails or neglects to perform any obligation in Sections 6.2 (Financial Statements, Reports, Certificates), 6.4 (Taxes), 6.5 (Insurance), 6.6 (Operating Accounts), 6.7 (Protection of Intellectual Property Rights), 6.9 (Notice of Litigation and Default), 6.12 (Creation/Acquisition of Subsidiaries) or 6.13 (Further Assurances) or Borrower violates any covenant in Section 7; or
(b)    Borrower, or any of its Subsidiaries, fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or agreement contained in this Agreement or any Loan Documents, and as to any default (other than those specified in this Section 8) under such other term, provision, condition, covenant or agreement that can be cured, has failed to cure the default within ten (10) days after the occurrence thereof; provided, however, that if the default cannot by its nature be cured within the ten (10) day period or cannot after diligent attempts by Borrower be cured within such ten (10) day period, and such default is likely to be cured within a reasonable time, then Borrower shall have an additional period (which shall not in any case exceed thirty (30) days) to attempt to cure such default, and within such reasonable time period the failure to cure the default shall not be deemed an Event of Default (but no Credit Extensions shall be made during such cure period).  Grace periods provided under this Section shall not apply, among other things, to financial covenants or any other covenants set forth in subsection (a) above;
8.3    Investor Abandonment.  Any Lender determines in its good faith judgment, that (i) Borrower will not be able to satisfy the Obligations as they become due and payable, and (ii) none of Borrower’s principal investors (defined as each investor that has designated a member of Borrower’s Board of Directors) intends to fund such amounts as may be necessary to enable Borrower to satisfy the Obligations as they become due and payable, or (iii) there is a material impairment in the perfection or priority of the Collateral Agent’s security interest in, or the value of, the Collateral;
8.4    Attachment; Levy; Restraint on Business.
(a)    (i) The service of process seeking to attach, by trustee or similar process, any funds of Borrower or any of its Subsidiaries or of any entity under control of Borrower or its Subsidiaries on deposit with any Lender or any Lender’s Affiliate or any bank or other institution at which Borrower or any of its Subsidiaries maintains a Collateral Account, or (ii) a notice of lien, levy, or assessment is filed against Borrower or any of its Subsidiaries or their respective assets by any government agency, and the same under subclauses (i) and (ii) hereof are not, within ten (10) days after the occurrence thereof, discharged or stayed (whether through the posting of a bond or otherwise); provided, however, no Credit Extensions shall be made during any ten (10) day cure period; and
(b)    (i) any material portion of Borrower’s or any of its Subsidiaries’ assets is attached, seized, levied on, or comes into possession of a trustee or receiver, or (ii) any court order enjoins, restrains, or prevents Borrower or any of its Subsidiaries from conducting any material part of its business;
8.5    Insolvency.  (a) Borrower or any of its Subsidiaries is or becomes Insolvent; (b) Borrower or any of its Subsidiaries begins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against Borrower or any of its Subsidiaries and not dismissed or stayed within forty-five (45) days (but no Credit Extensions shall be made while Borrower or any Subsidiary is Insolvent and/or until any Insolvency Proceeding is dismissed);

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8.6    Other Agreements.  There is a default in any agreement to which Borrower or any of its Subsidiaries is a party with a third party or parties resulting in a right by such third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an amount in excess of One Hundred Thousand Dollars ($100,000.00) or that could reasonably be expected to have a Material Adverse Change;
8.7    Judgments.  One or more judgments, orders, or decrees for the payment of money in an amount, individually or in the aggregate, of at least One Hundred Thousand Dollars ($100,000.00) (not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against Borrower or any of its Subsidiaries and shall remain unsatisfied, unvacated, or unstayed for a period of ten (10) days after the entry thereof (provided that no Credit Extensions will be made prior to the satisfaction, vacation, or stay of such judgment, order or decree);
8.8    Misrepresentations.  Borrower or any of its Subsidiaries or any Person acting for Borrower or any of its Subsidiaries makes any representation, warranty, or other statement now or later in this Agreement, any Loan Document or in any writing delivered to Collateral Agent and/or Lenders or to induce Collateral Agent and/or the Lenders to enter this Agreement or any Loan Document, and such representation, warranty, or other statement is incorrect in any material respect when made;
8.9    Subordinated Debt.  A default or breach occurs under any agreement between Borrower or any of its Subsidiaries and any creditor of Borrower or any of its Subsidiaries that signed a subordination, intercreditor, or other similar agreement with Collateral Agent or the Lenders, or any creditor that has signed such an agreement with Collateral Agent or the Lenders breaches any terms of such agreement;
8.10    Guaranty.  (a) Any Guaranty terminates or ceases for any reason to be in full force and effect other than pursuant to its terms; (b)any Guarantor does not perform any obligation or covenant under any Guaranty and has failed to cure the failure to perform within ten (10) days after the occurrence thereof; provided, however, that if the failure to perform cannot by its nature be cured within the ten (10) day period or cannot after diligent attempts be cured within such ten (10) day period, and such failure is likely to be cured within a reasonable time, then such Guarantor shall have an additional period (which shall not in any case exceed thirty (30) days) to attempt to cure such failure, and within such reasonable time period the failure to cure the failure shall not be deemed an Event of Default (but no Credit Extensions shall be made during such cure period); (c) any circumstance described in Sections 8.3, 8.4, 8.5, 8.7, or 8.8 occurs with respect to any Guarantor, or (d) the liquidation, winding up, or termination of existence of any Guarantor except as permitted hereunder;
8.11    Governmental Approvals.  Any Governmental Approval shall have been revoked, rescinded, suspended, modified in an adverse manner, or not renewed in the ordinary course for a full term and such revocation, rescission, suspension, modification or non-renewal has resulted in or could reasonably be expected to result in a Material Adverse Change; or
8.12    Lien Priority.  Any Lien created hereunder or by any other Loan Document shall at any time fail to constitute a valid and perfected Lien on any of the Collateral purported to be secured thereby, subject to no prior or equal Lien, other than Permitted Liens which are permitted to have priority in accordance with the terms of this Agreement.

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9.    RIGHTS AND REMEDIES
9.1    Rights and Remedies.
(a)    Upon the occurrence and during the continuance of an Event of Default, Collateral Agent may, and at the written direction of Required Lenders shall, without notice or demand, do any or all of the following: (i) deliver notice of the Event of Default to Borrower, (ii) by notice to Borrower declare all Obligations immediately due and payable (but if an Event of Default described in Section 8.5 occurs all Obligations shall be immediately due and payable without any action by Collateral Agent or the Lenders) or (iii) by notice to Borrower suspend or terminate the obligations, if any, of the Lenders to advance money or extend credit for Borrower’s benefit under this Agreement or under any other agreement between Borrower and Collateral Agent and/or the Lenders (but if an Event of Default described in Section 8.5 occurs all obligations, if any, of the Lenders to advance money or extend credit for Borrower’s benefit under this Agreement or under any other agreement between Borrower and Collateral Agent and/or the Lenders shall be immediately terminated without any action by Collateral Agent or the Lenders).
(b)    Without limiting the rights of Collateral Agent and the Lenders set forth in Section 9.1(a) above, upon the occurrence and during the continuance of an Event of Default, Collateral Agent shall have the right, without notice or demand, to do any or all of the following:
(i)    foreclose upon and/or sell or otherwise liquidate, the Collateral;
(ii)    apply to the Obligations any (a) balances and deposits of Borrower that Collateral Agent or any Lender holds or controls, or (b) any amount held or controlled by Collateral Agent or any Lender owing to or for the credit or the account of Borrower; and/or     
(iii)    commence and prosecute an Insolvency Proceeding or consent to Borrower commencing any Insolvency Proceeding.
(c)    Without limiting the rights of Collateral Agent and the Lenders set forth in Sections 9.1(a) and (b) above, upon the occurrence and during the continuance of an Event of Default, Collateral Agent shall have the right, without notice or demand, to do any or all of the following:
(i)    settle or adjust disputes and claims directly with Account Debtors for amounts on terms and in any order that Collateral Agent considers advisable, notify any Person owing Borrower money of Collateral Agent’s security interest in such funds, and verify the amount of such account;
(ii)    make any payments and do any acts it considers necessary or reasonable to protect the Collateral and/or its security interest in the Collateral.  Borrower shall assemble the Collateral if Collateral Agent requests and make it available in a location as Collateral Agent reasonably designates.  Collateral Agent may enter premises where the Collateral is located, take and maintain possession of any part of the Collateral, and pay, purchase, contest, or compromise any Lien which appears to be prior or superior to its security interest and pay all expenses incurred.  Borrower grants Collateral Agent a license to enter and occupy any of its premises, without charge, to exercise any of Collateral Agent’s rights or remedies;
(iii)    ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, and/or advertise for sale, the Collateral.  Collateral Agent is hereby granted a non-exclusive, royalty-free license or other right to use, without charge, Borrower’s and each of its Subsidiaries’ labels, patents, copyrights, mask works, rights of use of any name, trade secrets, trade names, trademarks, service marks, and advertising matter, 

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or any similar property as it pertains to the Collateral, in completing production of, advertising for sale, and selling any Collateral and, in connection with Collateral Agent’s exercise of its rights under this Section 9.1, Borrower’s and each of its Subsidiaries’ rights under all licenses and all franchise agreements inure to Collateral Agent, for the benefit of the Lenders;
(iv)    place a “hold” on any account maintained with Collateral Agent or the Lenders and/or deliver a notice of exclusive control, any entitlement order, or other directions or instructions pursuant to any Control Agreement or similar agreements providing control of any Collateral;
(v)    demand and receive possession of Borrower’s Books;
(vi)    appoint a receiver to seize, manage and realize any of the Collateral, and such receiver shall have any right and authority as any competent court will grant or authorize in accordance with any applicable law, including any power or authority to manage the business of Borrower or any of its Subsidiaries;
(vii)    subject to clauses 9.1(a) and (b), exercise all rights and remedies available to Collateral Agent and each Lender under the Loan Documents or at law or equity, including all remedies provided under the Code (including disposal of the Collateral pursuant to the terms thereof);
(viii)    for any Letters of Credit, demand that Borrower (i) deposit cash with Bank in an amount equal to (x) if such Letters of Credit are denominated in Dollars, then one hundred five percent (105%); and (y) if such Letters of Credit are denominated in a Foreign Currency, then one hundred ten percent (110%), of the Dollar Equivalent of the aggregate face amount of all Letters of Credit remaining undrawn (plus all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its good faith business judgment)), to secure all of the Obligations relating to such Letters of Credit, as collateral security for the repayment of any future drawings under such Letters of Credit, and Borrower shall forthwith deposit and pay such amounts, and (ii) pay in advance all letter of credit fees scheduled to be paid or payable over the remaining term of any Letters of Credit; and
(ix)    terminate any FX Contracts.
Notwithstanding any provision of this Section 9.1 to the contrary, upon the occurrence of any Event of Default, Collateral Agent shall have the right to exercise any and all remedies referenced in this Section 9.1 without the written consent of Required Lenders following the occurrence of an Exigent Circumstance.  As used in the immediately preceding sentence, “Exigent Circumstance” means any event or circumstance that, in the reasonable judgment of Collateral Agent, imminently threatens the ability of Collateral Agent to realize upon all or any material portion of the Collateral, such as, without limitation, fraudulent removal, concealment, or abscondment thereof, destruction or material waste thereof, or failure of Borrower or any of its Subsidiaries after reasonable demand to maintain or reinstate adequate casualty insurance coverage, or which, in the judgment of Collateral Agent, could reasonably be expected to result in a material diminution in value of the Collateral.
9.2    Power of Attorney.  Borrower hereby irrevocably appoints Collateral Agent as its lawful attorney-in-fact, exercisable upon the occurrence and during the continuance of an Event of Default, to: (a) endorse Borrower’s or any of its Subsidiaries’ name on any checks or other forms of payment or security; (b) sign Borrower’s or any of its Subsidiaries’ name on any invoice or bill of lading for any Account or drafts against Account Debtors; (c) settle and adjust disputes and claims about the Accounts directly with Account Debtors, for amounts and on terms Collateral Agent determines reasonable; (d) make, settle, and adjust all claims under Borrower’s insurance policies; (e) pay, contest or settle any Lien, charge, encumbrance, security interest, and adverse claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate 

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or discharge the same; and (f) transfer the Collateral into the name of Collateral Agent or a third party as the Code or any applicable law permits.  Borrower hereby appoints Collateral Agent as its lawful attorney-in-fact to sign Borrower’s or any of its Subsidiaries’ name on any documents necessary to perfect or continue the perfection of Collateral Agent’s security interest in the Collateral regardless of whether an Event of Default has occurred until all Obligations (other than inchoate indemnity obligations) have been satisfied in full and Collateral Agent and the Lenders are under no further obligation to make Credit Extensions hereunder.  Collateral Agent’s foregoing appointment as Borrower’s or any of its Subsidiaries’ attorney in fact, and all of Collateral Agent’s rights and powers, coupled with an interest, are irrevocable until all Obligations (other than inchoate indemnity obligations) have been fully repaid and performed and Collateral Agent’s and the Lenders’ obligation to provide Credit Extensions terminates.
9.3    Protective Payments.  If Borrower or any of its Subsidiaries fail to obtain the insurance called for by Section 6.5 or fails to pay any premium thereon or fails to pay any other amount which Borrower or any of its Subsidiaries is obligated to pay under this Agreement or any other Loan Document, Collateral Agent may obtain such insurance or make such payment, and all amounts so paid by Collateral Agent are Lenders’ Expenses and immediately due and payable, bearing interest at the Default Rate, and secured by the Collateral.  Collateral Agent will make reasonable efforts to provide Borrower with notice of Collateral Agent obtaining such insurance or making such payment at the time it is obtained or paid or within a reasonable time thereafter.  No such payments by Collateral Agent are deemed an agreement to make similar payments in the future or Collateral Agent’s waiver of any Event of Default.
9.4    Application of Payments and Proceeds.  Notwithstanding anything to the contrary contained in this Agreement, upon the occurrence and during the continuance of an Event of Default, (a) Borrower irrevocably waives the right to direct the application of any and all payments at any time or times thereafter received by Collateral Agent from or on behalf of Borrower or any of its Subsidiaries of all or any part of the Obligations, and, as between Borrower on the one hand and Collateral Agent and Lenders on the other, Collateral Agent shall have the continuing and exclusive right to apply and to reapply any and all payments received against the Obligations in such manner as Collateral Agent may deem advisable notwithstanding any previous application by Collateral Agent, and (b) the proceeds of any sale of, or other realization upon all or any part of the Collateral shall be applied: first, to the Lenders’ Expenses; second, to accrued and unpaid interest on the Obligations (including any interest which, but for the provisions of the United States Bankruptcy Code, would have accrued on such amounts); third, to the principal amount of the Obligations outstanding; and fourth, to any other indebtedness or obligations of Borrower owing to Collateral Agent or any Lender under the Loan Documents.  Any balance remaining shall be delivered to Borrower or to whoever may be lawfully entitled to receive such balance or as a court of competent jurisdiction may direct.  In carrying out the foregoing, (x) amounts received shall be applied in the numerical order provided until exhausted prior to the application to the next succeeding category, and (y) each of the Persons entitled to receive a payment in any particular category shall receive an amount equal to its pro rata share of amounts available to be applied pursuant thereto for such category.  Any reference in this Agreement to an allocation between or sharing by the Lenders of any right, interest or obligation “ratably,” “proportionally” or in similar terms shall refer to Pro Rata Share unless expressly provided otherwise.  Collateral Agent, or if applicable, each Lender, shall promptly remit to the other Lenders such sums as may be necessary to ensure the ratable repayment of each Lender’s portion of any Term Loan and the ratable distribution of interest, fees and reimbursements paid or made by Borrower.  Notwithstanding the foregoing, a Lender receiving a scheduled payment shall not be responsible for determining whether the other Lenders also received their scheduled payment on such date; provided, however, if it is later determined that a Lender received more than its ratable share of scheduled payments made on any date or dates, then such Lender shall remit to Collateral Agent or other Lenders such sums as may be necessary to ensure the ratable payment of such scheduled payments, as instructed by Collateral Agent.  If any payment or distribution of any kind or character, whether in cash, 

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properties or securities, shall be received by a Lender in excess of its ratable share, then the portion of such payment or distribution in excess of such Lender’s ratable share shall be received by such Lender in trust for and shall be promptly paid over to the other Lender for application to the payments of amounts due on the other Lenders’ claims.  To the extent any payment for the account of Borrower is required to be returned as a voidable transfer or otherwise, the Lenders shall contribute to one another as is necessary to ensure that such return of payment is on a pro rata basis.  If any Lender shall obtain possession of any Collateral, it shall hold such Collateral for itself and as agent and bailee for Collateral Agent and other Lenders for purposes of perfecting Collateral Agent’s security interest therein.
9.5    Liability for Collateral.  So long as Collateral Agent and the Lenders comply with reasonable banking practices and applicable law regarding the safekeeping of the Collateral in the possession or under the control of Collateral Agent and the Lenders, Collateral Agent and the Lenders shall not be liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage to the Collateral; (c) any diminution in the value of the Collateral; or (d) any act or default of any carrier, warehouseman, bailee, or other Person.  Borrower bears all risk of loss, damage or destruction of the Collateral.
9.6    No Waiver; Remedies Cumulative.  Failure by Collateral Agent or any Lender, at any time or times, to require strict performance by Borrower of any provision of this Agreement or any other Loan Document shall not waive, affect, or diminish any right of Collateral Agent or any Lender thereafter to demand strict performance and compliance herewith or therewith.  No waiver hereunder shall be effective unless signed by Collateral Agent and the Required Lenders and then is only effective for the specific instance and purpose for which it is given.  The rights and remedies of Collateral Agent and the Lenders under this Agreement and the other Loan Documents are cumulative.  Collateral Agent and the Lenders have all rights and remedies provided under the Code, any applicable law, by law, or in equity.  The exercise by Collateral Agent or any Lender of one right or remedy is not an election, and Collateral Agent’s or any Lender’s waiver of any Event of Default is not a continuing waiver.  Collateral Agent’s or any Lender’s delay in exercising any remedy is not a waiver, election, or acquiescence.
9.7    Demand Waiver.  Borrower waives, to the fullest extent permitted by law, demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by Collateral Agent or any Lender on which Borrower or any Subsidiary is liable.
10.    NOTICES
All notices, consents, requests, approvals, demands, or other communication (collectively, “Communication”) by any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or delivered: (a) upon the earlier of actual receipt and three (3) Business Days after deposit in the U.S.  mail, first class, registered or certified mail return receipt requested, with proper postage prepaid; (b) upon transmission, when sent by facsimile transmission; (c) one (1) Business Day after deposit with a reputable overnight courier with all charges prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed to the party to be notified and sent to the address, facsimile number, or email address indicated below.  Any of Collateral Agent, Lender or Borrower may change its mailing address or facsimile number by giving the other party written notice thereof in accordance with the terms of this Section 10.

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If to Borrower: 
 
MIRAMAR LABS, INC. 
2790 Walsh Ave. 
Santa Clara, CA 95051  
Attn: Brigid Makes  
Fax: (408) 940-8795 
Email: bmakes@miramarlabs.com

with a copy (which shall not constitute notice) to: 
 
Wilson Sonsini Goodrich & Rosati 
650 Page Mill Road 
Palo Alto, CA 94304 
Attn: Philip Oettinger 
Fax: (650) 493-6811 
Email: poettinger@wsgr.com

If to Collateral Agent: 
 
OXFORD FINANCE LLC 
133 North Fairfax Street  
Alexandria, Virginia 22314  
Attention: Legal Department  
Fax: (703) 519-5225 
Email: LegalDepartment@oxfordfinance.com

with a copy to: 
 
SILICON VALLEY BANK 
2400 Hanover Street  
Palo Alto, California 94304  
Attn: Jason Hughes  
Fax: (650) 856-7879 
Email: jhughes@svb.com

with a copy (which shall not constitute notice) to: 
 
DLA Piper LLP (US) 
4365 Executive Drive, Suite 1100  
San Diego, California 92121-2133  
Attn: Troy Zander 
Fax: (858) 638-5086 
troy.zander@dlapiper.com

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11.    CHOICE OF LAW, VENUE AND JURY TRIAL WAIVER, AND JUDICIAL REFERENCE
California law governs the Loan Documents without regard to principles of conflicts of law.  Borrower, Collateral Agent and each Lender each submit to the exclusive jurisdiction of the State and Federal courts in Santa Clara County, California; provided, however, that nothing in this Agreement shall be deemed to operate to preclude Collateral Agent or any Lender from bringing suit or taking other legal action in any other jurisdiction to realize on the Collateral or any other security for the Obligations, or to enforce a judgment or other court order in favor of Collateral Agent or any Lender.  Borrower expressly submits and consents in advance to such jurisdiction in any action or suit commenced in any such court, and Borrower hereby waives any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consents to the granting of such legal or equitable relief as is deemed appropriate by such court.  Borrower hereby waives personal service of the summons, complaints, and other process issued in such action or suit and agrees that service of such summons, complaints, and other process may be made by registered or certified mail addressed to Borrower at the address set forth in, or subsequently provided by Borrower in accordance with, Section 10 of this Agreement and that service so made shall be deemed completed upon the earlier to occur of Borrower’s actual receipt thereof or three (3) days after deposit in the U.S. mails, proper postage prepaid.
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER, COLLATERAL AGENT AND EACH LENDER EACH WAIVE THEIR RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS.  THIS WAIVER IS A MATERIAL INDUCEMENT FOR EACH PARTY TO ENTER INTO THIS AGREEMENT.  EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.
WITHOUT INTENDING IN ANY WAY TO LIMIT THE PARTIES’ AGREEMENT TO WAIVE THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY, if the above waiver of the right to a trial by jury is not enforceable, the parties hereto agree that any and all disputes or controversies of any nature between them arising at any time shall be decided by a reference to a private judge, mutually selected by the parties (or, if they cannot agree, by the Presiding Judge of the Santa Clara County, California Superior Court) appointed in accordance with California Code of Civil Procedure Section 638 (or pursuant to comparable provisions of federal law if the dispute falls within the exclusive jurisdiction of the federal courts), sitting without a jury, in Santa Clara County, California; and the parties hereby submit to the jurisdiction of such court.  The reference proceedings shall be conducted pursuant to and in accordance with the provisions of California Code of Civil Procedure §§ 638 through 645.1, inclusive.  The private judge shall have the power, among others, to grant provisional relief, including without limitation, entering temporary restraining orders, issuing preliminary and permanent injunctions and appointing receivers.  All such proceedings shall be closed to the public and confidential and all records relating thereto shall be permanently sealed.  If during the course of any dispute, a party desires to seek provisional relief, but a judge has not been appointed at that point pursuant to the judicial reference procedures, then such party may apply to the Santa Clara County, California Superior Court for such relief.  The proceeding before the private judge shall be conducted in the same manner as it would be before a court under the rules of evidence applicable to judicial proceedings.  The parties shall be entitled to discovery which shall be conducted in the same manner as it would be before a court under the rules of discovery applicable to judicial proceedings.  The private judge shall oversee discovery and may enforce all discovery rules and orders applicable to judicial proceedings in the same manner as a trial court judge.  The parties agree that the selected or appointed private judge shall have the power to decide all issues in the action or proceeding, whether of fact or of law, and shall report a statement of decision thereon pursuant to California Code of Civil Procedure § 644(a).  Nothing in this paragraph shall limit the right of any party at any time to exercise self-help remedies, foreclose against collateral, or obtain provisional 

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remedies.  The private judge shall also determine all issues relating to the applicability, interpretation, and enforceability of this paragraph.
12.    GENERAL PROVISIONS
12.1    Successors and Assigns.  This Agreement binds and is for the benefit of the successors and permitted assigns of each party.  Borrower may not transfer, pledge or assign this Agreement or any rights or obligations under it without Collateral Agent’s and each Lender’s prior written consent (which may be granted or withheld in Collateral Agent’s and each Lender’s discretion, subject to Section 12.6).  The Lenders have the right, without the consent of or notice to Borrower, to sell, transfer, assign, pledge, negotiate, or grant participation in (any such sale, transfer, assignment, negotiation, or grant of a participation, a “Lender Transfer”) all or any part of, or any interest in, the Lenders’ obligations, rights, and benefits under this Agreement and the other Loan Documents; provided, however, that any such Lender Transfer (other than a transfer, pledge, sale or assignment to an Eligible Assignee) of its obligations, rights, and benefits under this Agreement and the other Loan Documents shall require the prior written consent of the Required Lenders (such approved assignee, an “Approved Lender”).  Borrower and Collateral Agent shall be entitled to continue to deal solely and directly with such Lender in connection with the interests so assigned until Collateral Agent shall have received and accepted an effective assignment agreement in form satisfactory to Collateral Agent executed, delivered and fully completed by the applicable parties thereto, and shall have received such other information regarding such Eligible Assignee or Approved Lender as Collateral Agent reasonably shall require.  Notwithstanding anything to the contrary contained herein, so long as no Event of Default has occurred and is continuing, no Lender Transfer (other than a Lender Transfer (i) in respect of the Warrants or (ii) in connection with (x) assignments by a Lender due to a forced divestiture at the request of any regulatory agency; or (y) upon the occurrence of a default, event of default or similar occurrence with respect to a Lender’s own financing or securitization transactions) shall be permitted, without Borrower’s consent, to any Person which is an Affiliate or Subsidiary of Borrower, a direct competitor of Borrower or a vulture hedge fund, each as determined by Collateral Agent.
12.2    Indemnification.  Borrower agrees to indemnify, defend and hold Collateral Agent and the Lenders and their respective directors, officers, employees, agents, attorneys, or any other Person affiliated with or representing Collateral Agent or the Lenders (each, an “Indemnified Person”) harmless against: (a) all obligations, demands, claims, and liabilities (collectively, “Claims”) asserted by any other party in connection with; related to; following; or arising from, out of or under, the transactions contemplated by the Loan Documents; and (b) all losses or Lenders’ Expenses incurred, or paid by Indemnified Person in connection with; related to; following; or arising from, out of or under, the transactions contemplated by the Loan Documents between Collateral Agent, and/or the Lenders and Borrower (including reasonable attorneys’ fees and expenses), except for Claims and/or losses directly caused by such Indemnified Person’s gross negligence or willful misconduct.  Borrower hereby further indemnifies, defends and holds each Indemnified Person harmless from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, expenses and disbursements of any kind or nature whatsoever (including the fees and disbursements of counsel for such Indemnified Person) in connection with any investigative, response, remedial, administrative or judicial matter or proceeding, whether or not such Indemnified Person shall be designated a party thereto and including any such proceeding initiated by or on behalf of Borrower, and the reasonable expenses of investigation by engineers, environmental consultants and similar technical personnel and any commission, fee or compensation claimed by any broker (other than any broker retained by Collateral Agent or Lenders) asserting any right to payment for the transactions contemplated hereby which may be imposed on, incurred by or asserted against such Indemnified Person as a result of or in connection with the transactions contemplated hereby and the use or intended use of the proceeds of the loan proceeds except, in each case, for liabilities, obligations, losses, damages, 

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penalties, actions, judgments, suits, claims, costs, expenses and disbursements directly caused by such Indemnified Person’s gross negligence or willful misconduct.
12.3    Time of Essence.  Time is of the essence for the performance of all Obligations in this Agreement.
12.4    Severability of Provisions.  Each provision of this Agreement is severable from every other provision in determining the enforceability of any provision.
12.5    Correction of Loan Documents.  Collateral Agent and the Lenders may correct patent errors and fill in any blanks in this Agreement and the other Loan Documents consistent with the agreement of the parties.
12.6    Amendments in Writing; Integration.  (a) No amendment, modification, termination or waiver of any provision of this Agreement or any other Loan Document, no approval or consent thereunder, or any consent to any departure by Borrower or any of its Subsidiaries therefrom, shall in any event be effective unless the same shall be in writing and signed by Borrower, Collateral Agent and the Required Lenders provided that:
(i)    no such amendment, waiver or other modification that would have the effect of increasing or reducing a Lender’s Term Loan Commitment or Commitment Percentage shall be effective as to such Lender without such Lender’s written consent;
(ii)    no such amendment, waiver or modification that would affect the rights and duties of Collateral Agent shall be effective without Collateral Agent’s written consent or signature;
(iii)    no such amendment, waiver or other modification shall, unless signed by all the Lenders directly affected thereby, (A) reduce the principal of, rate of interest on or any fees with respect to any Term Loan or forgive any principal, interest (other than default interest) or fees (other than late charges) with respect to any Term Loan (B) postpone the date fixed for, or waive, any payment of principal of any Term Loan or of interest on any Term Loan (other than default interest) or any fees provided for hereunder (other than late charges or for any termination of any commitment); (C) change the definition of the term “Required Lenders” or the percentage of Lenders which shall be required for the Lenders to take any action hereunder; (D) release all or substantially all of any material portion of the Collateral, authorize Borrower to sell or otherwise dispose of all or substantially all or any material portion of the Collateral or release any Guarantor of all or any portion of the Obligations or its guaranty obligations with respect thereto, except, in each case with respect to this clause (D), as otherwise may be expressly permitted under this Agreement or the other Loan Documents (including in connection with any disposition permitted hereunder); (E) amend, waive or otherwise modify this Section 12.6 or the definitions of the terms used in this Section 12.6 insofar as the definitions affect the substance of this Section 12.6; (F) consent to the assignment, delegation or other transfer by Borrower of any of its rights and obligations under any Loan Document or release Borrower of its payment obligations under any Loan Document, except, in each case with respect to this clause (F), pursuant to a merger or consolidation permitted pursuant to this Agreement; (G) amend any of the provisions of Section 9.4 or amend any of the definitions of Pro Rata Share, Term Loan Commitment, Commitment Percentage or that provide for the Lenders to receive their Pro Rata Shares of any fees, payments, setoffs or proceeds of Collateral hereunder; (H) subordinate the Liens granted in favor of Collateral Agent securing the Obligations; or (I) amend any of the provisions of Section 12.10.  It is hereby understood and agreed that all Lenders shall be deemed directly affected by an amendment, waiver or other modification of the type described in the preceding clauses (C), (D), (E), (F), (G) and (H) of the preceding sentence;

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(iv)    the provisions of the foregoing clauses (i), (ii) and (iii) are subject to the provisions of any interlender or agency agreement among the Lenders and Collateral Agent pursuant to which any Lender may agree to give its consent in connection with any amendment, waiver or modification of the Loan Documents only in the event of the unanimous agreement of all Lenders.
(b)    Other than as expressly provided for in Section 12.6(a)(i)-(iii), Collateral Agent may, if requested by the Required Lenders, from time to time designate covenants in this Agreement less restrictive by notification to a representative of Borrower.
(c)    This Agreement and the Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements.    All prior agreements, understandings, 
 
representations, warranties, and negotiations between the parties about the subject matter of this Agreement and the Loan Documents merge into this Agreement and the Loan Documents.
12.7    Counterparts.  This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, is an original, and all taken together, constitute one Agreement.
12.8    Survival.  All covenants, representations and warranties made in this Agreement continue in full force and effect until this Agreement has terminated pursuant to its terms and all Obligations (other than inchoate indemnity obligations and any other obligations which, by their terms, are to survive the termination of this Agreement) have been satisfied.  Without limiting the foregoing, except as otherwise provided in Section 4.1, the grant of security interest by Borrower in Section 4.1 shall survive until the termination of all Bank Services Agreements.  The obligation of Borrower in Section 12.2 to indemnify each Lender and Collateral Agent, as well as the confidentiality provisions in Section 12.9 below, shall survive until the statute of limitations with respect to such claim or cause of action shall have run.
12.9    Confidentiality.  In handling any confidential information of Borrower, the Lenders and Collateral Agent shall exercise the same degree of care that it exercises for their own proprietary information, but disclosure of information may be made: (a) subject to the terms and conditions of this Agreement, to the Lenders’ and Collateral Agent’s Subsidiaries or Affiliates, or in connection with a Lender’s own financing or securitization transactions and upon the occurrence of a default, event of default or similar occurrence with respect to such financing or securitization transaction; (b) to prospective transferees (other than those identified in (a) above) or purchasers of any interest in the Credit Extensions (provided, however, the Lenders and Collateral Agent shall, except upon the occurrence and during the continuance of an Event of Default, obtain such prospective transferee’s or purchaser’s agreement to the terms of this provision or to similar confidentiality terms); (c) as required by law, regulation, subpoena, or other order; (d) to Lenders’ or Collateral Agent’s regulators or as otherwise required in connection with an examination or audit; (e) as Collateral Agent reasonably considers appropriate in exercising remedies under the Loan Documents; and (f) to third party service providers of the Lenders and/or Collateral Agent so long as such service providers have executed a confidentiality agreement with the Lenders and Collateral Agent with terms no less restrictive than those contained herein.  Confidential information does not include information that either: (i) is in the public domain or in the Lenders’ and/or Collateral Agent’s possession when disclosed to the Lenders and/or Collateral Agent, or becomes part of the public domain after disclosure to the Lenders and/or Collateral Agent through no fault of Collateral Agent or any Lender; or (ii) is disclosed to the Lenders and/or Collateral Agent by a third party, if the Lenders and/or Collateral Agent does not know that the third party is prohibited from disclosing the information.  Collateral Agent and the Lenders 

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may use confidential information for any purpose, including, without limitation, for the development of client databases, reporting purposes, and market analysis.  The provisions of the immediately preceding sentence shall survive the termination of this Agreement.  The agreements provided under this Section 12.9 supersede all prior agreements, understanding, representations, warranties, and negotiations between the parties about the subject matter of this Section 12.9.
12.10    Right of Set Off.  Borrower hereby grants to Collateral Agent and to each Lender, a lien, security interest and right of set off as security for all Obligations to Collateral Agent and each Lender hereunder, whether now existing or hereafter arising upon and against all deposits, credits, collateral and property, now or hereafter in the possession, custody, safekeeping or control of Collateral Agent or the Lenders or any entity under the control of Collateral Agent or the Lenders (including a Collateral Agent affiliate) or in transit to any of them.  At any time after the occurrence and during the continuance of an Event of Default, without demand or notice, Collateral Agent or the Lenders may set off the same or any part thereof and apply the same to any liability or obligation of Borrower even though unmatured and regardless of the adequacy of any other collateral securing the Obligations.  ANY AND ALL RIGHTS TO REQUIRE COLLATERAL AGENT TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.
12.11    Silicon Valley Bank as Agent.  Collateral Agent hereby appoints Silicon Valley Bank (“SVB”) as its agent (and SVB hereby accepts such appointment) for the purpose of perfecting Collateral Agent’s Liens in assets which, in accordance with Article 8 or Article 9, as applicable, of the Code can be perfected by possession or control, including without limitation, all Deposit Accounts maintained at SVB.
12.12    Cooperation of Borrower.  If necessary, Borrower agrees to (i) execute any documents (including new Secured Promissory Notes) reasonably required to effectuate and acknowledge each assignment of a Term Loan Commitment or Loan to an assignee in accordance with Section 12.1, (ii) make Borrower’s management available to meet with Collateral Agent and prospective participants and assignees of Term Loan Commitments or Credit Extensions (which meetings shall be conducted no more often than twice every twelve months unless an Event of Default has occurred and is continuing), and (iii) assist Collateral Agent or the Lenders in the preparation of information relating to the financial affairs of Borrower as any prospective participant or assignee of a Term Loan Commitment or Term Loan reasonably may request.  Subject to the provisions of Section 12.9, Borrower authorizes each Lender to disclose to any prospective participant or assignee of a Term Loan Commitment, any and all information in such Lender’s possession concerning Borrower and its financial affairs which has been delivered to such Lender by or on behalf of Borrower pursuant to this Agreement, or which has been delivered to such Lender by or on behalf of Borrower in connection with such Lender’s credit evaluation of Borrower prior to entering into this Agreement.
13.    DEFINITIONS
13.1    Definitions.  As used in this Agreement, the following terms have the following meanings:
“Account” is any “account” as defined in the Code with such additions to such term as may hereafter be made, and includes, without limitation, all accounts receivable and other sums owing to Borrower.
“Account Debtor” is any “account debtor” as defined in the Code with such additions to such term as may hereafter be made.

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“Affiliate” of any Person is a Person that owns or controls directly or indirectly the Person, any Person that controls or is controlled by or is under common control with the Person, and each of that Person’s senior executive officers, directors, partners and, for any Person that is a limited liability company, that Person’s managers and members.
“Agreement” is defined in the preamble hereof.
“Amortization Date” is January 1, 2017; provided that, upon Borrower achieving Revenue Event 2.0, whether or not Borrower requests or is advanced the Term C Loan, the Amortization Date shall be July 1, 2017.
“Annual Projections” is defined in Section 6.2(a).
“Anti-Terrorism Laws” are any laws relating to terrorism or money laundering, including Executive Order No. 13224 (effective September 24, 2001), the USA PATRIOT Act, the laws comprising or implementing the Bank Secrecy Act, and the laws administered by OFAC.
“Approved Fund” is any (i) investment company, fund, trust, securitization vehicle or conduit that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business or (ii) any Person (other than a natural person) which temporarily warehouses loans for any Lender or any entity described in the preceding clause (i) and that, with respect to each of the preceding clauses (i) and (ii), is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) a Person (other than a natural person) or an Affiliate of a Person (other than a natural person) that administers or manages a Lender.
“Approved Lender” is defined in Section 12.1.
“Bank Services” are any products, credit services, and/or financial accommodations previously, now, or hereafter provided to Borrower or any of its Subsidiaries by Bank or any Bank Affiliate, including, without limitation, any letters of credit, cash management services (including, without limitation, merchant services, direct deposit of payroll, business credit cards, and check cashing services), interest rate swap arrangements, and foreign exchange services as any such products or services may be identified in Bank’s various agreements related thereto (each, a “Bank Services Agreement”).
“Bank” is defined in the preamble hereof.
“Basic Rate” is, with respect to a Term Loan, the per annum rate of interest (based on a year of three hundred sixty (360) days) equal to the greater of (i) seven and eight tenths percent (7.80%) and (ii) the sum of (a) the Prime Rate published in The Wall Street Journal three (3) Business Days prior to the Funding Date of such Term Loan (which shall not, in any case, be less than three and one-quarter percent (3.25%)), plus (b) four and fifty-five hundredths percent (4.55%).
“Blocked Person” is any Person: (a) listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224, (b) a Person owned or controlled by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224, (c) a Person with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law, (d) a Person that commits, threatens or conspires to commit or supports “terrorism” as defined in Executive Order No. 13224, or (e) a Person that is named a “specially designated national” or “blocked person” on the most current list published by OFAC or other similar list.

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“Borrower” is defined in the preamble hereof.
“Borrower’s Books” are Borrower’s or any of its Subsidiaries’ books and records including ledgers, federal, and state tax returns, records regarding Borrower’s or its Subsidiaries’ assets or liabilities, the Collateral, business operations or financial condition, and all computer programs or storage or any equipment containing such information.
“Business Day” is any day that is not a Saturday, Sunday or a day on which Collateral Agent is closed.
“Cash Equivalents” are (a) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency or any State thereof having maturities of not more than one (1) year from the date of acquisition; (b) commercial paper maturing no more than one (1) year after its creation and having the highest rating from either Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc., (c) certificates of deposit maturing no more than one (1) year after issue provided that the account in which any such certificate of deposit is maintained is subject to a Control Agreement in favor of Collateral Agent, and (d) money market funds at least ninety-five percent (95%) of which constitute Cash Equivalents of the kinds described in clauses (a) through (c) above.  For the avoidance of doubt, the direct purchase by Borrower or any of its Subsidiaries of any Auction Rate Securities, or purchasing participations in, or entering into any type of swap or other derivative transaction, or otherwise holding or engaging in any ownership interest in any type of Auction Rate Security by Borrower or any of its Subsidiaries shall be conclusively determined by the Lenders as an ineligible Cash Equivalent, and any such transaction shall expressly violate each other provision of this Agreement governing Permitted Investments.  Notwithstanding the foregoing, Cash Equivalents does not include and Borrower, and each of its Subsidiaries, are prohibited from purchasing, purchasing participations in, entering into any type of swap or other equivalent derivative transaction, or otherwise holding or engaging in any ownership interest in any type of debt instrument, including, without limitation, any corporate or municipal bonds with a long-term nominal maturity for which the interest rate is reset through a dutch auction and more commonly referred to as an auction rate security (each, an “Auction Rate Security”).
“Claims” are defined in Section 12.2.
“Code” is the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the State of California; provided, that, to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently in different Articles or Divisions of the Code, the definition of such term contained in Article or Division 9 shall govern; provided further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, or priority of, or remedies with respect to, Collateral Agent’s Lien on any Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than the State of California, the term “Code” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority, or remedies and for purposes of definitions relating to such provisions.
“Collateral” is any and all properties, rights and assets of Borrower described on Exhibit A.
“Collateral Account” is any Deposit Account, Securities Account, or Commodity Account, or any other bank account maintained by Borrower or any Subsidiary at any time.
“Collateral Agent” is, Oxford, not in its individual capacity, but solely in its capacity as agent on behalf of and for the benefit of the Lenders.
“Commitment Percentage” is set forth in Schedule 1.1, as amended from time to time.

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“Commodity Account” is any “commodity account” as defined in the Code with such additions to such term as may hereafter be made.
“Communication” is defined in Section 10.
“Compliance Certificate” is that certain certificate in the form attached hereto as Exhibit C.
“Contingent Obligation” is, for any Person, any direct or indirect liability, contingent or not, of that Person for (a) any indebtedness, lease, dividend, letter of credit or other obligation of another such as an obligation directly or indirectly guaranteed, endorsed, co-made, discounted or sold with recourse by that Person, or for which that Person is directly or indirectly liable; (b) any obligations for undrawn letters of credit for the account of that Person; and (c) all obligations from any interest rate, currency or commodity swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; but “Contingent Obligation” does not include endorsements in the ordinary course of business.  The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement.
“Control Agreement” is any control agreement entered into among the depository institution at which Borrower or any of its Subsidiaries maintains a Deposit Account or the securities intermediary or commodity intermediary at which Borrower or any of its Subsidiaries maintains a Securities Account or a Commodity Account, Borrower and such Subsidiary, and Collateral Agent pursuant to which Collateral Agent obtains control (within the meaning of the Code) for the benefit of the Lenders over such Deposit Account, Securities Account, or Commodity Account.
“Copyrights” are any and all copyright rights, copyright applications, copyright registrations and like protections in each work or authorship and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret.
“Credit Extension” is any Term Loan or any other extension of credit by Collateral Agent or Lenders for Borrower’s benefit.
“Default Rate” is defined in Section 2.3(b).
“Deposit Account” is any “deposit account” as defined in the Code with such additions to such term as may hereafter be made.
“Designated Deposit Account” is Borrower’s deposit account, account number XXXXXX8350, maintained with Bank.
“Disbursement Letter” is that certain form attached hereto as Exhibit B-1.
“Dollar Equivalent” is, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) with respect to any amount denominated in a Foreign Currency, the equivalent amount therefor in Dollars as determined by Bank at such time on the basis of the then-prevailing rate of exchange in San Francisco, California, for sales of the Foreign Currency for transfer to the country issuing such Foreign Currency.
“Dollars,” “dollars” and “$” each mean lawful money of the United States.

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“Effective Date” is defined in the preamble of this Agreement.
“Eligible Assignee” is (i) a Lender, (ii) an Affiliate of a Lender, (iii) an Approved Fund and (iv) any commercial bank, savings and loan association or savings bank or any other entity which is an “accredited investor” (as defined in Regulation D under the Securities Act of 1933, as amended) and which extends credit or buys loans as one of its businesses, including insurance companies, mutual funds, lease financing companies and commercial finance companies, in each case, which either (A) has a rating of BBB or higher from Standard & Poor’s Rating Group and a rating of Baa2 or higher from Moody’s Investors Service, Inc. at the date that it becomes a Lender or (B) has total assets in excess of Five Billion Dollars ($5,000,000,000.00), and in each case of clauses (i) through (iv), which, through its applicable lending office, is capable of lending to Borrower without the imposition of any withholding or similar taxes; provided that notwithstanding the foregoing, “Eligible Assignee” shall not include, unless an Event of Default has occurred and is continuing, (i) Borrower or any of Borrower’s Affiliates or Subsidiaries or (ii) a direct competitor of Borrower or a vulture hedge fund, each as reasonably determined by Collateral Agent.  Notwithstanding the foregoing, (x) in connection with assignments by a Lender due to a forced divestiture at the request of any regulatory agency, the restrictions set forth herein shall not apply and Eligible Assignee shall mean any Person or party and (y) in connection with a Lender’s own financing or securitization transactions, the restrictions set forth herein shall not apply and Eligible Assignee shall mean any Person or party providing such financing or formed to undertake such securitization transaction and any transferee of such Person or party upon the occurrence of a default, event of default or similar occurrence with respect to such financing or securitization transaction; provided that no such sale, transfer, pledge or assignment under this clause (y) shall release such Lender from any of its obligations hereunder or substitute any such Person or party for such Lender as a party hereto until Collateral Agent shall have received and accepted an effective assignment agreement from such Person or party in form satisfactory to Collateral Agent executed, delivered and fully completed by the applicable parties thereto, and shall have received such other information regarding such Eligible Assignee as Collateral Agent reasonably shall require.
“Equipment” is all “equipment” as defined in the Code with such additions to such term as may hereafter be made, and includes without limitation all machinery, fixtures, goods, vehicles (including motor vehicles and trailers), and any interest in any of the foregoing.
“ERISA” is the Employee Retirement Income Security Act of 1974, as amended, and its regulations. 
“Event of Default” is defined in Section 8.
“Existing Indebtedness” is the indebtedness of Borrower to the Lenders pursuant to that certain Loan and Security Agreement, dated June 27, 2013 (as amended from time to time), entered into by and between Collateral Agent, the Lenders and Borrower, as more particularly described in that certain payoff letter dated on or about the Effective Date.
“Final Payment” is a payment (in addition to and not a substitution for the regular monthly payments of principal plus accrued interest) due on the earliest to occur of (a) the Maturity Date, or (b) the acceleration of any Term Loan, or (c) the prepayment of a Term Loan pursuant to Section 2.2(c) or (d), equal to the original principal amount of such Term Loan multiplied by the Final Payment Percentage, payable to Lenders in accordance with their respective Pro Rata Shares.
“Final Payment Percentage” is two and one-quarter percent (2.25%).
“Foreign Currency” means lawful money of a country other than the United States.

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“Foreign Subsidiary” is a Subsidiary that is not an entity organized under the laws of the United States or any territory thereof.
“Funding Date” is any date on which a Credit Extension is made to or on account of Borrower which shall be a Business Day.
“FX Contract” is any foreign exchange contract by and between Borrower and Bank under which Borrower commits to purchase from or sell to Bank a specific amount of Foreign Currency on a specified date.
“GAAP” is generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other Person as may be approved by a significant segment of the accounting profession in the United States, which are applicable to the circumstances as of the date of determination.
“General Intangibles” are all “general intangibles” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation, all copyright rights, copyright applications, copyright registrations and like protections in each work of authorship and derivative work, whether published or unpublished, any patents, trademarks, service marks and, to the extent permitted under applicable law, any applications therefor, whether registered or not, any trade secret rights, including any rights to unpatented inventions, payment intangibles, royalties, contract rights, goodwill, franchise agreements, purchase orders, customer lists, route lists, telephone numbers, domain names, claims, income and other tax refunds, security and other deposits, options to purchase or sell real or personal property, rights in all litigation presently or hereafter pending (whether in contract, tort or otherwise), insurance policies (including without limitation key man, property damage, and business interruption insurance), payments of insurance and rights to payment of any kind.
“Governmental Approval” is any consent, authorization, approval, order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority.
“Governmental Authority” is any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any self-regulatory organization.
“Guarantor” is any Person providing a Guaranty in favor of Collateral Agent.
“Guaranty” is any guarantee of all or any part of the Obligations, as the same may from time to time be amended, restated, modified or otherwise supplemented.
“Indebtedness” is (a) indebtedness for borrowed money or the deferred price of property or services, such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations, and (d) Contingent Obligations.
“Indemnified Person” is defined in Section 12.2.

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“Insolvency Proceeding” is any proceeding by or against any Person under the United States Bankruptcy Code, or any other bankruptcy or insolvency law, including assignments for the benefit of creditors, compositions, extensions generally with its creditors, or proceedings seeking reorganization, arrangement, or other relief.
“Insolvent” means not Solvent.
“Intellectual Property” means all of Borrower’s or any Subsidiary’s right, title and interest in and to the following:
(a)    its Copyrights, Trademarks and Patents;
(b)    any and all trade secrets and trade secret rights, including, without limitation, any rights to unpatented inventions, know-how, operating manuals;
(c)    any and all source code;
(d)    any and all design rights which may be available to Borrower;
(e)    any and all claims for damages by way of past, present and future infringement of any of the foregoing, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the Intellectual Property rights identified above; and
(f)    all amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents.
“Inventory” is all “inventory” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation all merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and finished products, including without limitation such inventory as is temporarily out of any Person’s custody or possession or in transit and including any returned goods and any documents of title representing any of the above.
“Investment” is any beneficial ownership interest in any Person (including stock, partnership interest or other securities), and any loan, advance, or capital contribution to any Person.
“Key Person” is each of Borrower’s (i) President and Chief Executive Officer, who is Michael Kleine and (ii) Chief Financial Officer, who is Brigid A.  Makes as of the Effective Date.
“Lender” is any one of the Lenders.
“Lenders” are the Persons identified on Schedule 1.1 hereto and each assignee that becomes a party to this Agreement pursuant to Section 12.1.
“Lenders’ Expenses” are all audit fees and expenses, costs, and expenses (including reasonable attorneys’ fees and expenses, as well as appraisal fees, fees incurred on account of lien searches, inspection fees, and filing fees) for preparing, amending, negotiating, administering, defending and enforcing the Loan Documents (including, without limitation, those incurred in connection with appeals or Insolvency Proceedings) or otherwise incurred by Collateral Agent and/or the Lenders in connection with the Loan Documents.

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“Letter of Credit” is a standby or commercial letter of credit issued by Bank upon request of Borrower based upon an application, guarantee, indemnity, or similar agreement.
“Lien” is a claim, mortgage, deed of trust, levy, charge, pledge, security interest, or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property.
“Loan Documents” are, collectively, this Agreement, the Warrants, the Perfection Certificates, each Compliance Certificate, each Disbursement Letter, each Loan Payment/Advance Request Form and any Bank Services Agreement, any subordination agreements, any note, or notes or guaranties executed by Borrower or any other Person, and any other present or future agreement entered into by Borrower, any Guarantor or any other Person for the benefit of the Lenders and Collateral Agent in connection with this Agreement; all as amended, restated, or otherwise modified.
“Loan Payment/Advance Request Form” is that certain form attached hereto as Exhibit B-2.
“Material Adverse Change” is (a) a material impairment in the perfection or priority of Collateral Agent’s Lien in the Collateral or in the value of such Collateral; (b) a material adverse change in the business, operations or condition (financial or otherwise) of Borrower or any Subsidiary; or (c) a material impairment of the prospect of repayment of any portion of the Obligations.
“Maturity Date” is September 1, 2019.
“Miramar Hong Kong Account” means accounts held by Miramar Labs HK subject to the limitations of Section 7.12.
“Obligations” are all of Borrower’s obligations to pay when due any debts, principal, interest, Lenders’ Expenses, the Prepayment Fee, the Final Payment, and other amounts Borrower owes the Lenders now or later, in connection with, related to, following, or arising from, out of or under, this Agreement or, the other Loan Documents (other than the Warrants), or otherwise, including, without limitation, all obligations relating to letters of credit (including reimbursement obligations for drawn and undrawn letters of credit), cash management services, and foreign exchange contracts, if any, and including interest accruing after Insolvency Proceedings begin (whether or not allowed) and debts, liabilities, or obligations of Borrower assigned to the Lenders and/or Collateral Agent, and the performance of Borrower’s duties under the Loan Documents (other than the Warrants).
“OFAC” is the U.S. Department of Treasury Office of Foreign Assets Control.
“OFAC Lists” are, collectively, the Specially Designated Nationals and Blocked Persons List maintained by OFAC pursuant to Executive Order No. 13224, 66 Fed. Reg. 49079 (Sept. 25, 2001) and/or any other list of terrorists or other restricted Persons maintained pursuant to any of the rules and regulations of OFAC or pursuant to any other applicable Executive Orders.
“Operating Documents” are, for any Person, such Person’s formation documents, as certified by the Secretary of State (or equivalent agency) of such Person’s jurisdiction of organization on a date that is no earlier than thirty (30) days prior to the Effective Date, and, (a) if such Person is a corporation, its bylaws in current form, (b) if such Person is a limited liability company, its limited liability company agreement (or similar agreement), and (c) if such Person is a partnership, its partnership agreement (or similar agreement), each of the foregoing with all current amendments or modifications thereto.

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“Patents” means all patents, patent applications and like protections including without limitation improvements, divisions, continuations, renewals, reissues, extensions and continuations-in-part of the same.
“Payment Date” is the first (1st) calendar day of each calendar month, commencing on October 1, 2015.
“Perfection Certificate” and “Perfection Certificates” is defined in Section 5.1.
“Permitted Indebtedness” is:
(a)    Borrower’s Indebtedness to the Lenders and Collateral Agent under this Agreement and the other Loan Documents;
(b)    Indebtedness existing on the Effective Date and disclosed on the Perfection Certificate(s);
(c)    Subordinated Debt;
(d)    unsecured Indebtedness to trade creditors incurred in the ordinary course of business;
(e)    Indebtedness consisting of capitalized lease obligations and purchase money Indebtedness, in each case incurred by Borrower or any of its Subsidiaries to finance the acquisition, repair, improvement or construction of fixed or capital assets of such person, provided that (i) the aggregate outstanding principal amount of all such Indebtedness does not exceed Two Hundred Fifty Thousand Dollars ($250,000.00) at any time and (ii) the principal amount of such Indebtedness does not exceed the lower of the cost or fair market value of the property so acquired or built or of such repairs or improvements financed with such Indebtedness (each measured at the time of such acquisition, repair, improvement or construction is made);
(f)    Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of Borrower’s business; 
(g)    Intercompany indebtedness that otherwise constitutes an Investment permitted under clauses (a), (f) and (i) of the definition of Permitted Investments;
(h)    Other Indebtedness not to exceed One Hundred Thousand Dollars ($100,000.00) in the aggregate principal amount outstanding at any time; and
(i)    extensions, refinancings, modifications, amendments and restatements of any items of Permitted Indebtedness (a) through (e) above, provided that the principal amount thereof is not increased or the terms thereof are not modified to impose materially more burdensome terms upon Borrower, or its Subsidiary, as the case may be.
“Permitted Investments” are:
(a)    Investments disclosed on the Perfection Certificate(s) and existing on the Effective Date;
(b)    (i) Investments consisting of cash and Cash Equivalents, and (ii) any Investments permitted by Borrower’s investment policy, as amended from time to time, provided that such investment policy (and any such amendment thereto) has been approved in writing by Collateral Agent;

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(c)    Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of Borrower;
(d)    Investments consisting of Deposit Accounts and Securities Accounts in which Collateral Agent has a perfected security interest to the extent required under Section 6.6;
(e)    Investments in connection with Transfers permitted by Section 7.1;
(f)    Investments by Borrower in Subsidiaries not to exceed Four Hundred Fifty Thousand Dollars ($450,000.00) per month, and in any event not to exceed Four Million Five Hundred Thousand Dollars ($4,500,000.00) in the aggregate in Borrower’s 2015 fiscal year and thereafter;
(g)    Investments consisting of (i) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business, and (ii) loans to employees, officers or directors relating to the purchase of equity securities of Borrower or its Subsidiaries pursuant to employee stock purchase plans or agreements approved by Borrower’s Board of Directors; not to exceed Twenty Five Thousand Dollars ($25,000.00) outstanding at any time in the aggregate for (i) and (ii) in any fiscal year;
(h)    Investments (including debt obligations) received in connection with the bankruptcy or reorganization of customers or suppliers and in settlement of delinquent obligations of, and other disputes with, customers or suppliers arising in the ordinary course of business;
(i)    Investments consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers and suppliers who are not Affiliates, in the ordinary course of business; provided that this paragraph (i) shall not apply to Investments of Borrower in any Subsidiary;
(j)    non-cash Investments in joint ventures or strategic alliances in the ordinary course of Borrower’s business consisting of the non-exclusive licensing of technology, the development of technology or the providing of technical support;
(k)    lease-hold improvement costs associated with any expansion or relocation of facilities in the ordinary course of business not to exceed Three Hundred Thousand Dollars ($300,000.00) at any time; and
(l)    other Investments not to exceed Two Hundred Fifty Thousand Dollars ($250,000.00) in any fiscal year. 
“Permitted Licenses” are (A) licenses of over-the-counter software that is commercially available to the public, and (B) non-exclusive and exclusive licenses for the use of the Intellectual Property of Borrower or any of its Subsidiaries entered into in the ordinary course of business, provided, that, with respect to each such license described in clause (B), (i) no Event of Default has occurred or is continuing at the time of such license; (ii) the license constitutes an arms-length transaction, the terms of which, on their face, do not provide for a sale or assignment of any Intellectual Property and do not restrict the ability of Borrower or any of its Subsidiaries, as applicable, to pledge, grant a security interest in or lien on, or assign or otherwise Transfer any Intellectual Property; (iii) in the case of any exclusive license, (x) Borrower delivers ten (10) days’ prior written notice and a brief summary of the terms of the proposed license to Collateral Agent and the Lenders and delivers to Collateral Agent and the Lenders copies of the final executed licensing documents in connection with the exclusive license promptly upon consummation thereof, and (y) any such license could not result in a legal transfer of title of the licensed property but may be exclusive in respects other than territory and may be exclusive as to territory only 

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as to discrete geographical areas outside of the United States; and (iv) all upfront payments, royalties, milestone payments or other proceeds arising from the licensing agreement that are payable to Borrower or any of its Subsidiaries are paid to a Deposit Account that is governed by a Control Agreement.
“Permitted Liens” are:
(a)    Liens existing on the Effective Date and disclosed on the Perfection Certificates or arising under this Agreement and the other Loan Documents;
(b)    Liens for taxes, fees, assessments or other government charges or levies, either (i) not due and payable or (ii) being contested in good faith and for which Borrower maintains adequate reserves on its Books, provided that no notice of any such Lien has been filed or recorded under the Internal Revenue Code of 1986, as amended, and the Treasury Regulations adopted thereunder;
(c)    liens securing Indebtedness permitted under clause (e) of the definition of “Permitted Indebtedness,” provided that (i) such liens exist prior to the acquisition of, or attach substantially simultaneous with, or within twenty (20) days after the, acquisition, lease, repair, improvement or construction of, such property financed or leased by such Indebtedness and (ii) such liens do not extend to any property of Borrower other than the property (and proceeds thereof) acquired, leased or built, or the improvements or repairs, financed by such Indebtedness;
(d)    Liens of carriers, warehousemen, suppliers, or other Persons that are possessory in nature arising in the ordinary course of business so long as such Liens attach only to Inventory, securing liabilities in the aggregate amount not to exceed One Hundred Thousand Dollars ($100,000.00), and which are not delinquent or remain payable without penalty or which are being contested in good faith and by appropriate proceedings which proceedings have the effect of preventing the forfeiture or sale of the property subject thereto;
(e)    Liens to secure payment of workers’ compensation, employment insurance, old-age pensions, social security and other like obligations incurred in the ordinary course of business (other than Liens imposed by ERISA);
(f)    Liens incurred in the extension, renewal or refinancing of the indebtedness secured by Liens described in (a) through (c), but any extension, renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness may not increase;
(g)    leases or subleases of real property granted in the ordinary course of Borrower’s business (or, if referring to another Person, in the ordinary course of such Person’s business), and leases, subleases, non-exclusive licenses or sublicenses of personal property (other than Intellectual Property) granted in the ordinary course of Borrower’s business (or, if referring to another Person, in the ordinary course of such Person’s business), if the leases, subleases, licenses and sublicenses do not prohibit granting Collateral Agent or any Lender a security interest therein;
(h)    banker’s liens, rights of setoff and Liens in favor of financial institutions incurred in the ordinary course of business arising in connection with Borrower’s deposit accounts or securities accounts held at such institutions solely to secure payment of fees and similar costs and expenses and provided such accounts are maintained in compliance with Section 6.6(b) hereof;
(i)    deposits to secure the performance of bids, trade contracts (other than for borrowed money), leases statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like 

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nature, in each case, incurred in the ordinary course of business and not representing an obligations for borrowed money;
(j)    Liens in favor of customs and revenue authorities arising in the ordinary course of Borrower’s business and as a matter of law to secure payment of customs duties in connection with the importation of goods;
(k)    Liens on insurance proceeds in favor of insurance companies granted as security for financed premiums;
(l)    Liens arising from judgments, decrees or attachments in circumstances not constituting an Event of Default under Section 8.4 or 8.7; and
(m)    Liens consisting of Permitted Licenses.
“Person” is any individual, sole proprietorship, partnership, limited liability company, joint venture, company, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or government agency.
“Prepayment Fee” is, with respect to any Term Loan subject to prepayment prior to the Maturity Date, whether by mandatory or voluntary prepayment, acceleration or otherwise, an additional fee payable to the Lenders in amount equal to:
(i)    for a prepayment made on or after the Funding Date of such Term Loan through and including the second anniversary of the Funding Date of such Term Loan, two percent (2.0%) of the principal amount of such Term Loan prepaid; and
(ii)    for a prepayment made after the second anniversary of the Funding Date of such Term Loan and prior to the Maturity Date, one percent (1.0%) of the principal amount of such Term Loan prepaid.
“Pro Rata Share” is, as of any date of determination, with respect to each Lender, a percentage (expressed as a decimal, rounded to the ninth decimal place) determined by dividing the outstanding principal amount of Term Loans held by such Lender by the aggregate outstanding principal amount of all Term Loans.
“Registered Organization” is any “registered organization” as defined in the Code with such additions to such term as may hereafter be made.
“Required Lenders” means (i) for so long as all of the Persons that are Lenders on the Effective Date (each an “Original Lender”) have not assigned or transferred any of their interests in their Term Loan, Lenders holding one hundred percent (100%) of the aggregate outstanding principal balance of the Term Loan, or (ii) at any time from and after any Original Lender has assigned or transferred any interest in its Term Loan, Lenders holding at least sixty six percent (66%) of the aggregate outstanding principal balance of the Term Loan and, in respect of this clause (ii), (A) each Original Lender that has not assigned or transferred any portion of its Term Loan, (B) each assignee or transferee of an Original Lender’s interest in the Term Loan, but only to the extent that such assignee or transferee is an Affiliate or Approved Fund of such Original Lender, and (C) any Person providing financing to any Person described in clauses (A) and (B) above; provided, however, that this clause (C) shall only apply upon the occurrence of a default, event of default or similar occurrence with respect to such financing.

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“Requirement of Law” is as to any Person, the organizational or governing documents of such Person, and any law (statutory or common), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.
“Responsible Officer” is any of the President, Chief Executive Officer, or Chief Financial Officer of Borrower acting alone.
“Revenue Event 1.0” is the achievement by Borrower after the Effective Date at the end of any fiscal month of Borrower of trailing six (6) months’ consolidated revenue of at least Ten Million Dollars ($10,000,000.00) as of the end of such fiscal month, as determined by Collateral Agent in its reasonable discretion based upon written evidence satisfactory to Collateral Agent.
“Revenue Event 2.0” is (x) the achievement by Borrower after the Effective Date at the end of any fiscal month of Borrower of trailing six (6) months’ consolidated revenue of at least Fifteen Million Dollars ($15,000,000.00) as of the end of such fiscal month, as determined by Collateral Agent in its reasonable discretion based upon written evidence satisfactory to Collateral Agent; and (y) Borrower’s receipt of net cash proceeds after the Effective Date, from the sale and issuance of Borrower’s equity securities, of at least Fifteen Million Dollars ($15,000,000.00), from investors and on terms and conditions reasonably acceptable to Collateral Agent.
“SEC” is the Securities and Exchange Commission, or any successor thereto.
“Second Draw Period” is the period commencing on the first Business Day following the occurrence of Revenue Event 1.0 and ending on the earliest of (i) the date that is sixty (60) days from the date of occurrence of Revenue Event 1.0, (ii) April 30, 2016 and (iii) the existence of an Event of Default; provided, however, that the Second Draw Period shall not commence if on the date of the occurrence of Revenue Event 1.0 an Event of Default has occurred and is continuing.
“Secured Promissory Note” is defined in Section 2.4.
“Secured Promissory Note Record” is a record maintained by each Lender with respect to the outstanding Obligations owed by Borrower to Lender and credits made thereto.
“Securities Account” is any “securities account” as defined in the Code with such additions to such term as may hereafter be made.
“Shares” is one hundred percent (100%) of the issued and outstanding capital stock, membership units or other securities owned or held of record by Borrower or Borrower’s Subsidiary, in any Subsidiary; provided that, in the event Borrower, demonstrates to Collateral Agent’s reasonable satisfaction, that a pledge of more than sixty five percent (65%) of the Shares of such Subsidiary which is a Foreign Subsidiary, creates a present and existing adverse tax consequence to Borrower under the U.S. Internal Revenue Code, “Shares” shall mean sixty five percent (65%) of the issued and outstanding capital stock, membership units or other securities owned or held of record by Borrower or its Subsidiary in such Foreign Subsidiary.
“Solvent” is, with respect to any Person: the fair salable value of such Person’s consolidated assets (including goodwill minus disposition costs) exceeds the fair value of such Person’s liabilities; such Person is not left with unreasonably small capital after the transactions in this Agreement; and such Person is able to pay its debts (including trade debts) as they mature.

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“Subordinated Debt” is indebtedness incurred by Borrower or any of its Subsidiaries subordinated to all Indebtedness of Borrower and/or its Subsidiaries to the Lenders (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Collateral Agent and the Lenders entered into between Collateral Agent, Borrower, and/or any of its Subsidiaries, and the other creditor), on terms acceptable to Collateral Agent and the Lenders.
“Subsidiary” is, with respect to any Person, any Person of which more than fifty percent (50%) of the voting stock or other equity interests (in the case of Persons other than corporations) is owned or controlled, directly or indirectly, by such Person or through one or more intermediaries.
“Term Loan” is defined in Section 2.2(a)(ii) hereof.
“Term A Loan” is defined in Section 2.2(a)(i) hereof.
“Term B Loan” is defined in Section 2.2(a)(ii) hereof.
“Term C Loan” is defined in Section 2.2(a)(iii) hereof.
“Term Loan Commitment” is, for any Lender, the obligation of such Lender to make a Term Loan, up to the principal amount shown on Schedule 1.1.  “Term Loan Commitments” means the aggregate amount of such commitments of all Lenders.
“Third Draw Period” is the period commencing on the first Business Day following the occurrence of Revenue Event 2.0 and ending on the earliest of (i) the date that is sixty (60) days from the date of occurrence of Revenue Event 2.0; (ii) October 31, 2016 and (iii) the existence of an Event of Default; provided, however, that the Third Draw Period shall not commence if on the date of the occurrence of Revenue Event 2.0 an Event of Default has occurred and is continuing.
“Trademarks” means any trademark and servicemark rights, whether registered or not, applications to register and registrations of the same and like protections, and the entire goodwill of the business of Borrower connected with and symbolized by such trademarks.
“Transfer” is defined in Section 7.1.
“Warrants” are those certain Warrants to Purchase Stock dated as of the Effective Date, or any date thereafter, issued by Borrower in favor of each Lender or such Lender’s Affiliates.
[Balance of Page Intentionally Left Blank]

-43-

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

	 

	MIRAMAR LABS, INC.

	By 
	/s/ Brigid Makes

	Name:
	Brigid Makes

	Title:
	Chief Financial Officer

	 
	 

	COLLATERAL AGENT AND LENDER:

	 

	OXFORD FINANCE LLC

	By 
	 

	Name: 
	 

	Title: 
	 

	 
	 

	LENDER:

	 

	SILICON VALLEY BANK

	By 
	 

	Name: 
	 

	Title: 
	 

[Signature Page to Loan and Security Agreement]

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

	 

	MIRAMAR LABS, INC.

	By 
	 

	Name:
	 

	Title:
	 

	 
	 

	COLLATERAL AGENT AND LENDER:

	 

	OXFORD FINANCE LLC

	By 
	/s/ T. A. Lex

	Name: 
	T. A. Lex

	Title: 
	COO

	 
	 

	LENDER:

	 

	SILICON VALLEY BANK

	By 
	 

	Name: 
	 

	Title: 
	 

[Signature Page to Loan and Security Agreement]

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

	 

	MIRAMAR LABS, INC.

	By 
	 

	Name: 
	 

	Title: 
	 

	 
	 

	COLLATERAL AGENT AND LENDER:

	 

	OXFORD FINANCE LLC

	By 
	 

	Name: 
	 

	Title: 
	 

	 
	 

	LENDER:

	 

	SILICON VALLEY BANK

	By 
	/s/ Shawn Parry

	Name: 
	Shawn Parry

	Title: 
	Vice President

[Signature Page to Loan and Security Agreement]

SCHEDULE 1.1
Lenders and Commitments
Term A Loans
	
			
	Lender
	Term Loan Commitment
	Commitment Percentage

	OXFORD FINANCE LLC
	$5,000,000.00
	50%

	SILICON VALLEY BANK
	$5,000,000.00
	50%

	TOTAL
	$10,000,000.00
	100.00%

Term B Loans
	
			
	Lender
	Term Loan Commitment
	Commitment Percentage

	OXFORD FINANCE LLC
	$2,500,000.00
	50%

	SILICON VALLEY BANK
	$2,500,000.00
	50%

	TOTAL
	$5,000,000.00
	100.00%

Term C Loans
	
			
	Lender
	Term Loan Commitment
	Commitment Percentage

	OXFORD FINANCE LLC
	$2,500,000.00
	50%

	SILICON VALLEY BANK
	$2,500,000.00
	50%

	TOTAL
	$5,000,000.00
	100.00%

Aggregate (all Term Loans
	
			
	Lender
	Term Loan Commitment
	Commitment Percentage

	OXFORD FINANCE LLC
	$10,000,000.00
	50%

	SILICON VALLEY BANK
	$10,000,000.00
	50%

	TOTAL
	$20,000,000.00
	100.00%

EXHIBIT A
Description of Collateral
The Collateral consists of all of Borrower’s right, title and interest in and to the following personal property:
All goods, Accounts (including health-care receivables), Equipment, Inventory, contract rights or rights to payment of money, leases, license agreements, franchise agreements, General Intangibles (except as noted below), commercial tort claims, documents, instruments (including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts and other Collateral Accounts, all certificates of deposit, fixtures, letters of credit rights (whether or not the letter of credit is evidenced by a writing), securities, and all other investment property, supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever located; and 
All Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing.
Notwithstanding the foregoing, the Collateral does not include any (i) Intellectual Property; provided, however, the Collateral shall include all Accounts and all proceeds of Intellectual Property and provided further that if a judicial authority (including a U.S. Bankruptcy Court) would hold that a security interest in the underlying Intellectual Property is necessary to have a security interest in such Accounts and such property that are proceeds of Intellectual Property, then the Collateral shall automatically, and effective as of the Effective Date, include the Intellectual Property to the extent necessary to permit perfection of Collateral Agent’s security interest in such Accounts and such other property of Borrower that are proceeds of the Intellectual Property; (ii) more than 65% of the total combined voting power of all classes of stock entitled to vote the shares of capital stock (the “Shares”) of any Foreign Subsidiary, if Borrower demonstrates to Collateral Agent’s reasonable satisfaction that a pledge of more than sixty five percent (65%) of the Shares of such Subsidiary creates a present and existing adverse tax consequence to Borrower under the U.S. Internal Revenue Code; and (iii) any license or contract, in each case if the granting of a Lien in such license or contract is prohibited by or would constitute a default under the agreement governing such license or contract (but (A) only to the extent such prohibition is enforceable under applicable law and (B) other than to the extent that any such term would be rendered ineffective pursuant to Sections 9-406, 9-408 or 9-409 (or any other Section) of Division 9 of the Code); provided that upon the termination, lapsing or expiration of any such prohibition, such license or contract, as applicable, shall automatically be subject to the security interest granted in favor of Collateral Agent hereunder and become part of the “Collateral.”.
Pursuant to the terms of a certain negative pledge arrangement with Collateral Agent and the Lenders, Borrower has agreed not to encumber any of its Intellectual Property.

EXHIBIT B-1
Form of Disbursement Letter
[see attached]

DISBURSEMENT LETTER
August 7, 2015
The undersigned, being the duly elected and acting ________________________ of MIRAMAR LABS, INC., a Delaware Corporation with offices located at 2790 Walsh Ave., Santa Clara, CA 95051 (“Borrower”), does hereby certify, on behalf of Borrower and not in an individual capacity, to OXFORD FINANCE LLC (“Oxford” and “Lender”), as collateral agent (the “Collateral Agent”) in connection with that certain Loan and Security Agreement dated as of August 7, 2015, by and among Borrower, Collateral Agent and the Lenders from time to time party thereto (the “Loan Agreement”; with other capitalized terms used below having the meanings ascribed thereto in the Loan Agreement) that:
		
	1.
	The representations and warranties made by Borrower in Section 5 of the Loan Agreement and in the other Loan Documents are true and correct in all material respects as of the date hereof; provided that those representations and warranties expressly referring to a specific date shall be true and correct in all material respects as of such date.

		
	2.
	No event or condition has occurred that would constitute an Event of Default under the Loan Agreement or any other Loan Document.

		
	3.
	Borrower is in compliance with the covenants and requirements contained in Sections 4, 6 and 7 of the Loan Agreement.

		
	4.
	All conditions referred to in Section 3 of the Loan Agreement to the making of the Credit Extension to be made on or about the date hereof have been satisfied or waived by Collateral Agent.

		
	5.
	No Material Adverse Change has occurred.

		
	6.
	The undersigned is a Responsible Officer.

		
	7.
	[Revenue Event [1.0][2.0] has occurred.]

[Balance of Page Intentionally Left Blank]

7.    The proceeds of the Term [A][B][C] Loan shall be disbursed as follows:

	
				
	Disbursement from Oxford:
	 

	Loan Amount
	

	$5,000,000.00
	

	 
	 

	Less:
	 

	--Facility Fee
	($_________)
	

	-- Existing Debt Payoff to be remitted to Oxford Finance LLC per the Payoff Letter dated as of August 7, 2015
	($_________)]
	

	[--Interim Interest
	($_________)]
	

	--Lender’s Legal Fees
	($_________)*
	

	 
	 

	Net Proceeds due from Oxford:
	$____________
	

	 
	 

	Disbursement from SVB:
	 

	Loan Amount
	

	$5,000,000.00
	

	Less:
	 

	--Facility Fee
	($_________)
	

	-- Existing Debt Payoff to be remitted to Silicon Valley Bank per the Payoff Letter dated as of August 7, 2015
	($_________)]
	

	[--Interim Interest
	($_________)]
	

	 
	 

	Net Proceeds due from SVB:
	$____________
	

	 
	 

	TOTAL TERM [A][B][C] LOAN NET PROCEEDS FROM LENDERS
	$____________
	

8.    The Term [A][B][C] Loan shall amortize in accordance with the Amortization Table attached hereto.
9.    The aggregate net proceeds of the Term Loans shall be transferred to the Designated Deposit Account as follows:
Account Name:    MIRAMAR LABS, INC.
Bank Name:    Silicon Valley Bank
Bank Address:    3003 Tasman Drive
Santa Clara, California 95054
Account Number:    3300508350
ABA Number:    121140399
[Balance of Page Intentionally Left Blank]

Dated as of the date first set forth above.

	
		
	BORROWER:

	 

	MIRAMAR LABS, INC.

	By 
	 

	Name: 
	 

	Title: 
	 

	 
	 

	COLLATERAL AGENT AND LENDER:

	 

	OXFORD FINANCE LLC

	By 
	 

	Name: 
	 

	Title: 
	 

	 
	 

	LENDER:

	 

	SILICON VALLEY BANK

	By 
	 

	Name: 
	 

	Title: 
	 

[Signature Page to Disbursement Letter]

AMORTIZATION TABLE
(Term [A][B][C] Loan)
[see attached]

EXHIBIT B-2
Loan Payment/Advance Request Form
DEADLINE FOR SAME DAY PROCESSING IS NOON PACIFIC TIME*
Fax To:    Date: ____________

	
			
	LOAN PAYMENT:
	 
	 

	MIRAMAR LABS, INC.

	From Account #____________________________________
	 
	To Account #______________________________________

	(Deposit Account #)_________________________________
	 
	(Loan Account #)___________________________________

	Principal $________________________________________
	 
	and/or Interest $____________________________________

	Authorized Signature:_______________________________
	 
	Phone Number: ____________________________________

	Print Name/Title:___________________________________
	 
	 

	 
	 
	 

	LOAN ADVANCE:
	 
	 

	Complete Outgoing Wire Request section below if all or a portion of the funds from this loan advance are for an outgoing wire.

	From Account # ___________________________________
	 
	To Account #______________________________________

	(Loan Account #)___________________________________
	 
	(Deposit Account #)_________________________________

	Amount of Advance $_______________________________
	 
	 

	All Borrower’s representations and warranties in the Loan and Security Agreement are true, correct and complete in all material respects on the date of the request for an advance; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date:

	Authorized Signature:_______________________________
	 
	Phone Number:____________________________________

	Print Name/Title:___________________________________
	 
	 

	 
	 
	 

	OUTGOINGWIREREQUEST:
	 
	 

	Complete only if all or a portion of funds from the loan advance above is to be wired.

	Deadline for same day processing is noon, Pacific Time
	 
	 

	Beneficiary Name:__________________________________
	 
	Amount of Wire: $__________________________________

	Beneficiary Bank:__________________________________
	 
	Account Number:__________________________________

	City and State:_____________________________________
	 
	 

	Beneficiary Bank Transit (ABA) #_____________________
	 
	Beneficiary Bank Code (Swift, Sort, Chip, etc.):

	 
	 
	(For International Wire Only)

	Intermediary Bank:_________________________________
	 
	Transit (ABA) #:___________________________________

	For Further Credit to:__________________________________________________________________________________________

	Special Instruction: ___________________________________________________________________________________________

	By signing below, I (we) acknowledge and agree that my (our) funds transfer request shall be processed in accordance with and subject to the terms and conditions set forth in the agreements(s) covering funds transfer service(s), which agreements(s) were previously received and executed by me (us).

	Authorized Signature:_______________________________
	 
	2nd Signature (if required):___________________________

	Print Name/Title:___________________________________
	 
	Print Name/Title:___________________________________

	Telephone #:______________________________________
	 
	Telephone #:______________________________________

EXHIBIT C
Compliance Certificate
TO:    OXFORD FINANCE LLC, as Collateral Agent and Lender
SILICON VALLEY BANK, as Lender
FROM:    MIRAMAR LABS, INC.
The undersigned authorized officer (“Officer”) of MIRAMAR LABS, INC. (“Borrower”), hereby certifies on behalf of Borrower and not in any individual capacity that in accordance with the terms and conditions of the Loan and Security Agreement by and among Borrower, Collateral Agent, and the Lenders from time to time party thereto (the “Loan Agreement;” capitalized terms used but not otherwise defined herein shall have the meanings given them in the Loan Agreement),
(a)Borrower is in complete compliance for the period ending                    with all required covenants except as noted below;
(b)There are no Events of Default, except as noted below;
(c)Except as noted below, all representations and warranties of Borrower stated in the Loan Documents are true and correct in all material respects on this date and for the period described in (a), above; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date.
(d)Borrower, and each of Borrower’s Subsidiaries, has timely filed all required tax returns and reports, Borrower, and each of Borrower’s Subsidiaries, has timely paid all foreign, federal, state, and local taxes, assessments, deposits and contributions owed by Borrower, or Subsidiary, except as otherwise permitted pursuant to the terms of Section 5.8 of the Loan Agreement;
(e)No Liens have been levied or claims made against Borrower or any of its Subsidiaries relating to unpaid employee payroll or benefits of which Borrower has not previously provided written notification to Collateral Agent and the Lenders.
Attached are the required documents, if any, supporting our certification(s).  The Officer, on behalf of Borrower, further certifies that the attached financial statements are prepared in accordance with Generally Accepted Accounting Principles (GAAP) and are consistently applied from one period to the next except as explained in an accompanying letter or footnotes and except, in the case of unaudited financial statements, for the absence of footnotes and subject to year-end audit adjustments as to the interim financial statements.
Please indicate compliance status since the last Compliance Certificate by circling Yes, No, or N/A under “Complies” column.

	
					
	 
	Reporting Covenant
	Requirement
	Actual
	Complies

	1)
	Financial statements
	Monthly within 30 days
	 
	Yes   No   N/A

	2)
	Annual (CPA Audited) statements
	Within 180 days after FYE
	 
	Yes   No   N/A

	3)
	Annual Financial Projections/Budget (prepared on a monthly basis)
	Annually (within 10 days of FYE), and when revised
	 
	Yes   No   N/A

	4)
	A/R & A/P agings
	If applicable
	 
	Yes   No   N/A

	5)
	8-K, 10-K and 10-Q Filings
	If applicable, within 5 days of filing
	 
	Yes   No   N/A

	6)
	Compliance Certificate
	Monthly within 30 days
	 
	Yes   No   N/A

	7)
	IP Report
	When required
	 
	Yes   No   N/A

	8)
	Total amount of Borrower’s cash and cash equivalents at the last day of the measurement period
	 
	$
	Yes   No   N/A

	9)
	Total amount of Borrower’s Subsidiaries’ cash and cash equivalents at the last day of the measurement period
	 
	$
	Yes   No   N/A

Deposit and Securities Accounts
(Please list all accounts; attach separate sheet if additional space needed)

	
					
	 
	Institution Name
	Account Number
	New Account?
	Account Control Agreement in place?

	1)
	 
	 
	   Yes   No
	   Yes   No

	2)
	 
	 
	   Yes   No
	   Yes   No

	3)
	 
	 
	   Yes   No
	   Yes   No

	4)
	 
	 
	   Yes   No
	   Yes   No

Other Matters

	
				
	1)
	Have any Key Person ceased to be actively engaged in Borrower’s management since the last Compliance Certificate?
	Yes
	No

	2)
	Have there been any transfers/sales/disposals/retirement of Collateral or IP prohibited by the Loan Agreement?
	Yes
	No

	3)
	Have there been any new or pending claims or causes of action against Borrower that involve more than One Hundred Thousand Dollars ($100,000.00)?
	Yes
	No

	4)
	Have there been any amendments of or other changes to the capitalization table of Borrower and to the Operating Documents of Borrower or any of its Subsidiaries? If yes, provide copies of any such amendments or changes with this Compliance Certificate.
	Yes
	No

Exceptions
Please explain any exceptions with respect to the certification above: (If no exceptions exist, state “No exceptions.” Attach separate sheet if additional space needed.)

	
		
	MIRAMAR LABS, INC.

	 
	 

	By 
	 

	Name:
	 

	Title:
	 

	Date:
	 

	
					
	LENDER USE ONLY
	 

	 
	 
	 
	 

	Received by:
	 
	Date:
	 

	 
	 
	 
	 

	Verified by: 
	 
	Date:
	 

	 
	 
	 
	 
	 

	Compliance Status:
	Yes
	No
	 
	 

EXHIBIT D
Form of Secured Promissory Note
[see attached]

SECURED PROMISSORY NOTE
(Term [A][B][C] Loan)
$5,000,000.00    Dated: August 7, 2015
FOR VALUE RECEIVED, the undersigned, MIRAMAR LABS, INC., a Delaware Corporation with offices located at 2790 Walsh Ave., Santa Clara, CA 95051 (“Borrower”) HEREBY PROMISES TO PAY to the order of [OXFORD FINANCE LLC][SILICON VALLEY BANK] (“Lender”) the principal amount of FIVE MILLION DOLLARS ($5,000,000.00) or such lesser amount as shall equal the outstanding principal balance of the Term [A][B][C] Loan made to Borrower by Lender, plus interest on the aggregate unpaid principal amount of such Term [A][B][C] Loan, at the rates and in accordance with the terms of the Loan and Security Agreement dated August 7, 2015 by and among Borrower, Lender, Oxford Finance LLC, as Collateral Agent, and the other Lenders from time to time party thereto (as amended, restated, supplemented or otherwise modified from time to time, the “Loan Agreement”).  If not sooner paid, the entire principal amount and all accrued and unpaid interest hereunder shall be due and payable on the Maturity Date as set forth in the Loan Agreement.  Any capitalized term not otherwise defined herein shall have the meaning attributed to such term in the Loan Agreement.
Principal, interest and all other amounts due with respect to the Term [A][B][C] Loan, are payable in lawful money of the United States of America to Lender as set forth in the Loan Agreement and this Secured Promissory Note (this “Note”).  The principal amount of this Note and the interest rate applicable thereto, and all payments made with respect thereto, shall be recorded by Lender and, prior to any transfer hereof, endorsed on the grid attached hereto which is part of this Note.
The Loan Agreement, among other things, (a) provides for the making of a secured Term [A][B][C] Loan by Lender to Borrower, and (b) contains provisions for acceleration of the maturity hereof upon the happening of certain stated events.
This Note may not be prepaid except as set forth in Section 2.2 (c) and Section 2.2(d) of the Loan Agreement.
This Note and the obligation of Borrower to repay the unpaid principal amount of the Term [A][B][C] Loan, interest on the Term [A][B][C] Loan and all other amounts due Lender under the Loan Agreement is secured under the Loan Agreement.
Presentment for payment, demand, notice of protest and all other demands and notices of any kind in connection with the execution, delivery, performance and enforcement of this Note are hereby waived.
Borrower shall pay all reasonable fees and expenses, including, without limitation, reasonable attorneys’ fees and costs, incurred by Lender in the enforcement or attempt to enforce any of Borrower’s obligations hereunder not performed when due.
This Note shall be governed by, and construed and interpreted in accordance with, the internal laws of the State of California.
The ownership of an interest in this Note shall be registered on a record of ownership maintained by Lender or its agent.  Notwithstanding anything else in this Note to the contrary, the right to the principal of, and stated interest on, this Note may be transferred only if the transfer is registered on such record of ownership and the transferee is identified as the owner of an interest in the obligation.  Borrower shall be entitled to treat the registered holder of this Note (as recorded on such record of ownership) as the owner in fact thereof for all purposes and shall not be bound to recognize any equitable or other claim to or interest in this Note on the part of any other person or entity.
[Balance of Page Intentionally Left Blank]

IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed by one of its officers thereunto duly authorized on the date hereof.
	
		
	BORROWER:

	 

	MIRAMAR LABS, INC.

	By 
	 

	Name:
	 

	Title:
	 

LOAN INTEREST RATE AND PAYMENTS OF PRINCIPAL

	
									
	Date
	 
	Principal Amount
	 
	Interest Rate
	 
	Scheduled Payment Amount
	 
	Notation By

	 
	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 
	 

ANNEX I
Form of Perfection Certificate

[See attached]

CORPORATE BORROWING CERTIFICATE
[WSGR to provide draft]

DEBTOR:    MIRAMAR LABS, INC.
SECURED PARTY:    OXFORD FINANCE LLC,
as Collateral Agent
EXHIBIT A TO UCC FINANCING STATEMENT
Description of Collateral
The Collateral consists of all of Debtor’s right, title and interest in and to the following personal property:
All goods, Accounts (including health-care receivables), Equipment, Inventory, contract rights or rights to payment of money, leases, license agreements, franchise agreements, General Intangibles (except as noted below), commercial tort claims, documents, instruments (including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts and other Collateral Accounts, all certificates of deposit, fixtures, letters of credit rights (whether or not the letter of credit is evidenced by a writing), securities, and all other investment property, supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever located; and 
All Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing.
Notwithstanding the foregoing, the Collateral does not include any (i) Intellectual Property; provided, however, the Collateral shall include all Accounts and all proceeds of Intellectual Property and provided further that if a judicial authority (including a U.S. Bankruptcy Court) would hold that a security interest in the underlying Intellectual Property is necessary to have a security interest in such Accounts and such property that are proceeds of Intellectual Property, then the Collateral shall automatically, and effective as of the Effective Date, include the Intellectual Property to the extent necessary to permit perfection of Collateral Agent’s security interest in such Accounts and such other property of Borrower that are proceeds of the Intellectual Property; (ii) more than 65% of the total combined voting power of all classes of stock entitled to vote the shares of capital stock (the “Shares”) of any Foreign Subsidiary, if Borrower demonstrates to Collateral Agent’s reasonable satisfaction that a pledge of more than sixty five percent (65%) of the Shares of such Subsidiary creates a present and existing adverse tax consequence to Borrower under the U.S. Internal Revenue Code; and (iii) any license or contract, in each case if the granting of a Lien in such license or contract is prohibited by or would constitute a default under the agreement governing such license or contract (but (A) only to the extent such prohibition is enforceable under applicable law and (B) other than to the extent that any such term would be rendered ineffective pursuant to Sections 9-406, 9-408 or 9-409 (or any other Section) of Division 9 of the Code); provided that upon the termination, lapsing or expiration of any such prohibition, such license or contract, as applicable, shall automatically be subject to the security interest granted in favor of Collateral Agent hereunder and become part of the “Collateral.”.
Pursuant to the terms of a certain negative pledge arrangement with Collateral Agent and the Lenders, Debtor has agreed not to encumber any of its Intellectual Property.
Capitalized terms used but not defined herein have the meanings ascribed in the Uniform Commercial Code in effect in the State of California as in effect from time to time (the “Code”) or, if not defined in the Code, then in the Loan and Security Agreement by and between Debtor, Secured Party and the other Lenders party thereto (as modified, amended and/or restated from time to time).

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