Document:

Exhibit 10.1

ASSET PURCHASE AGREEMENT

By and Among

Plant Health Care, Inc., a Pennsylvania
corporation,

Plant Health Care plc, incorporated and registered in England
and Wales under the
 Companies Act 1985

and

Eden Bioscience Corporation, a Washington corporation
 and
its subsidiaries

December 1, 2006

ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT
(this “Agreement”) is dated as of the 1st day of December, 2006 by and among Plant Health Care, Inc., a Pennsylvania
corporation (the “Buyer”), Plant Health Care plc, incorporated and registered in England and Wales under the Companies Act 1985 (the
“Guarantor”), Eden Bioscience Corporation, a Washington corporation (the “Company”), and each of Eden Bioscience
Mexico, S. de R.L. de C.V. and Eden Bioscience Europe SARL (each of the foregoing and the Company, a “Seller” and collectively, the
“Sellers”). Each of the Buyer, Guarantor and the Sellers are a “Party”, and collectively, the
“Parties”.

WHEREAS, the Sellers, among other
matters, are engaged in the business of the creation of plant health technology incorporating harpin proteins and the manufacture of biopesticide,
plant health and nutrient products utilizing harpin protein technology for the agricultural and horticultural industries worldwide (the
“Business”);

WHEREAS, the Buyer desires to
purchase substantially all of the assets and other rights relating to the Business and assume certain liabilities relating to the Business, upon the
terms and subject to the conditions set forth herein, which terms include Guarantor’s guarantee of the deferred portion of the closing purchase
price payable to Sellers hereunder; and

WHEREAS, it is the intention of
the Parties that the Sellers retain certain assets and other rights relating to the operation of the Company’s existing home and garden business,
which the Company intends to continue to operate after the Closing of the transactions contemplated herein.

NOW, THEREFORE, in consideration
of the mutual promises and agreements set forth herein, the Buyer, Guarantor and each of the Sellers hereby agree as follows:

	1.    
	 	PURCHASE AND SALE.

1.1. Acquired Assets.
Subject to the terms and conditions set forth in this Agreement, at the Closing referred to in Section 4 hereof, the Sellers shall sell, assign,
transfer and deliver to the Buyer, and the Buyer shall purchase, acquire and take assignment and delivery of, all of the assets (other than the
Excluded Assets specified in Section 1.2) of the Sellers used in or relating to the Business existing as of the Closing Date (all of which assets are
hereinafter referred to collectively as the “Acquired Assets”), that are specifically described as follows:

(a)    All of
the Sellers’ title to, interest in and rights under the real estate leases (the “Real Property Leases”) described on
Schedule1.1(a) hereto relating to the properties described therein and all buildings, plants and other structures and improvements thereon, and,
to the extent covered by the Real Property Leases, any and all

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fixtures, machinery,
installations, equipment and other property attached thereto or located thereon (the “Leased Real Property”);

(b)    Any
and all plants, fixtures, machinery, installations, equipment, furniture, tools, spare parts, supplies, materials and other personal property used in
or relating to the Business, including without limitation, those items as of September 13, 2006 described on Schedule1.1(b) hereto (subject to
the provisions of Section 3.3 collectively, the “Equipment”);

(c)    All of
the Sellers’ title to, interest in and rights under the leases of personal property described on Schedule1.1(c) hereto (the
“Personal Property Leases”);

(d)    All of
the Sellers’ inventories used in or relating to the Business, including raw materials, supplies, parts, work in process and finished goods as of
June 30, 2006 described on Schedule 1.1(d) hereto (subject to the provisions of Section 3.3 collectively, the
“Inventories”);

(e)    All of
the Sellers’ rights under the contracts, customer purchase orders, the Wei Contract and agreements described on Schedule1.1(e) hereto, and
all contracts entered into in the ordinary course of business prior to the Closing consistent with the Sellers’ obligations under Section 7 hereof
(collectively, the “Assumed Contracts”);

(f)    All of
the Sellers’ transferable rights under the licenses, permits and approvals, both governmental and private, described on Schedule1.1(f)
hereto (collectively, the “Permits”);

(g)    All
Intellectual Property owned by the Sellers that is used in conducting the Business, including without limitation the Intellectual Property described on
Schedule1.1(g) hereto (collectively, the “Assigned Intellectual Property”); and

(h)    All of
the Sellers’ documents and records relating to the Acquired Assets.

1.2.    Excluded Assets. Notwithstanding the foregoing, the Sellers are not selling and the Buyer is not
purchasing, pursuant to this Agreement, and the term “Acquired Assets” shall not include, any of the following assets or rights of the
Sellers (collectively, the “Excluded Assets”):

(a)    the
consideration received or to be received by the Sellers pursuant to this Agreement;

(b)    the
rights of the Sellers under this Agreement, the bill of sale, the assignment and assumption instruments, the Note, the Security Agreement, the
Guaranty, the Supply Agreement and the Distributor Agreement (each as hereinafter defined);

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(c)    Sellers’ tax assets, including without limitation, Seller’s right to refunds of taxes and other
governmental charges of whatever nature;

(d)    Sellers’ financial records;

(e)    cash,
bank accounts or similar cash and cash equivalents, accounts receivable, notes and investments;

(f)    all
contracts other than the Assumed Contracts;

(g)    all
minute books and stock records and corporate seals;

(h)    those
rights relating to deposits and prepaid expenses and claims for refunds and rights to offset in respect thereof listed on Schedule 1.2(h)
hereto;

(i)    all
rights in connection with and assets of the Employee Benefit Plans, except pursuant to the Assumed Contracts specified in Schedule 1.1(e)
hereto;

(j)    all
insurance policies and rights thereunder;

(k)    all
personnel records and other records that Sellers are required by law to retain in its possession; and

(l)    the
assets listed on Schedule 1.2(1) hereto.

2.    ASSUMPTION OF CERTAIN OBLIGATIONS.

2.1    Assumed Obligations. At the Closing, the Buyer shall assume, and agree to pay, perform, fulfill and
discharge, all obligations and liabilities of any of the Sellers (the “Assumed Obligations”) arising out of the conduct of the
Business from and after the Closing, except for Excluded Liabilities, including, without limitation, the following:

(a)    Any
liabilities and obligations of Sellers arising under the Real Property Leases, Personal Property Leases and Assumed Contracts from and after the
Closing;

(b)    Any
liability and obligations relating to or arising out of any products sold, or services rendered by the Business from and after the Closing;
and

(c)    Any
liabilities arising out of any actual or alleged non-compliance with any Environmental Laws (as defined in Section 5.11) or for the clean-up or removal
of, or for death or injury to person or property or other damages and expenses as a result of a Release (as defined in Section 5.11(a)(iii)), emission
or discharge of any Hazardous Substances (as defined in Section 5.11(a)(ii)) arising out of or relating to the Buyer’s operation of the Business
or the Buyer’s leasing, owning or operation of real property from and after the Closing.

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2.2    Excluded Liabilities. Notwithstanding anything in this Agreement to the contrary, the Buyer shall not
assume, and shall not be deemed to have assumed, any liability or obligation of the Sellers not otherwise an Assumed Obligation, including without
limitation the following unassumed liabilities and obligations (collectively, the “Excluded Liabilities”):

(a)    any
liabilities or obligations for accounts payable or for Indebtedness of the Sellers;

(b)    any
liabilities for Taxes relating to any period prior to the Closing;

(c)    any
liabilities in connection with or relating to all actions, suits, claims, proceedings, demands, warranty claims, assessments and judgments, costs,
losses, damages, deficiencies and expenses (whether or not arising out of third party claims), including, without limitation, interest, penalties,
reasonable attorney and accountant fees and all amounts paid in investigation, defense or settlement of any of the foregoing, to the extent such
liability arises out of injuries, actions, omissions, conditions or events that occurred or existed prior to the Closing in connection with the
operation of the Business;

(d)    any
liability arising in connection with the employment or termination of employment of any persons affiliated with any Seller prior to the Closing,
including any workers’ compensation claims relating to events which transpired prior to the Closing, any employee grievances, any liabilities with
respect to Employee Benefit Plans (as defined in Section 13), or arising as a result of the consummation of the transactions contemplated by this
Agreement; provided, however, that the Buyer shall assume all liabilities and obligations of the Company under the Wei Contract (as defined in Section
7.4); and

(e)    any
liabilities arising out of any actual or alleged non-compliance with any Environmental Laws (as defined in Section 5.11) or for the clean-up or removal
of, or for death or injury to person or property or other damages and expenses as a result of a Release (as defined in Section 5.11(a)(iii)), emission
or discharge of any Hazardous Substances (as defined in Section 5.11(a)(ii)) arising out of or relating to the Seller’s operation of the Business
or the Seller’s leasing, owning or operation of real property prior to the Closing.

3.    PURCHASE PRICE.

3.1    Estimated Purchase Price. At the Closing, Buyer shall pay an amount in cash of $1,500,000 (One Million
Five-Hundred Thousand Dollars) and deliver to Buyer a promissory note (the “Note”) in the principal amount of $1,000,000 (One Million
Dollars) in the form attached hereto as Exhibit A (the “Estimated Purchase Price”), subject to adjustment as provided for in
Sections 3.2 and 3.3. Payments in cash shall be made by wire transfer of immediately available funds to an account of the Company designated thereby in
writing and delivered to Buyer at least two Business Days prior to the Closing.

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“Business Day” shall mean any day other than Saturday, Sunday or a day on which banks in Pittsburgh, Pennsylvania are required to be
closed for business.

3.2    At
least three Business Days prior to the Closing, the Company and Buyer shall perform a count or confirmation of all Inventories and Equipment that will
constitute part of the Acquired Assets as of the Closing Date (respectively, the “Estimated Equipment” and the “Estimated
Inventory”). If (A) the recorded value of the Estimated Equipment is less than the recorded value of the Equipment set out on Schedule 1.1(b)
(the dollar amount of such difference being the “Equipment Reduction Amount”) and/or (B) the recorded value of the Estimated Inventory
is less than the recorded value of the Inventories set out on Schedule 1.1(d) (the dollar amount of such difference being the “Inventory
Reduction Amount”), then, at the Closing, Buyer shall deduct from the Note portion of the Estimated Purchase Price (as provided in Section 3.3
below) the amount, if any, by which the Equipment Reduction Amount exceeds $25,000 and/or the amount, if any, by which the Inventory Reduction Amount
exceeds $125,000.

3.3    Post-Closing Adjustment. Within 15 days after the Closing Date, Buyer shall prepare and deliver to the
Company a schedule (the “Final Equipment and Inventory Schedule”) setting forth all Inventories and Equipment that remained from
Schedule 3.2 as of the Closing Date (the “Final Equipment and Inventory”). The Final Equipment and Inventory Schedule shall, applying
the formula set forth in Section 3.2 above, state the amount, if any, by which the Estimated Purchase Price is to be reduced by Buyer (the
“Purchase Price Adjustment”). If no Final Equipment and Inventory Schedule is delivered to the Company within such period, the Estimated
Equipment and Estimated Inventory schedules shall be final and binding on the Parties. The Company shall have a period of 15 days after its receipt of
the Final Equipment and Inventory Schedule to dispute the amount of the Purchase Price Adjustment by delivering to Buyer a written notice of objection
(an “Objection Notice”) setting forth a reasonably detailed explanation of the basis of the Company’s dispute. If no Objection
Notice is delivered to Buyer within such period, the Final Equipment and Inventory Schedule delivered by Buyer to the Company shall be final and
binding upon the parties. If an Objection Notice is delivered to Buyer within such period, the parties shall cooperate in good faith to resolve the
Company’s dispute. In the event that Buyer and the Company are unable to resolve such dispute within 30 days after the date an Objection Notice
was delivered to Buyer, then Buyer and the Company shall refer the issues in dispute to a nationally recognized firm of independent public accountants
not then engaged by Buyer or any Seller mutually agreeable to the parties (the “Arbiter”). Buyer and the Company shall submit their
positions on the dispute to the Arbiter within 30 days after appointment as such, and the Arbiter shall resolve the dispute within 20 days after such
submission (the “Resolution Date”), and such resolution shall be final and binding upon the Parties. The fees and expenses of the
Arbiter shall be paid one-half by Buyer and one-half by the Company. Upon final determination of the Purchase Price Adjustment, if any, the Estimated
Purchase Price shall be adjusted in the manner set forth in Section 3.2 and this Section 3.3, which adjusted purchase price shall be the
“Closing Purchase Price” for all other purposes under this Agreement. If the Closing Purchase Price is less than the Estimated
Purchase Price, then Buyer shall deduct the difference (if any) from the principal and interest due and payable under the Note.

3.4    Allocation of Purchase Price. No later than 60 days following the Closing

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Date, the Buyer shall submit
to the Company its allocation of the Closing Purchase Price and the Assumed Liabilities among the Acquired Assets subject to approval of the Company
(which approval shall not be unreasonably withheld) (the “Allocation”). The Allocation will be made in accordance with Section 1060 of
the Internal Revenue Code of 1986, as amended (the “Code”) and the Treasury Regulations promulgated thereunder. The Sellers and the
Buyer shall comply with the applicable information requirements of Section 1060 of the Code and shall file all information and Tax returns (and any
amendments thereto) in a manner consistent with the Allocation (including, without limitation, filing Form 8594 with their United Stated federal income
tax return for the taxable year that includes he date of the Closing). If, contrary to the intent of the Buyer and the Sellers as expressed in this
Section 3.4, any taxing authority makes or proposes an allocation different from that determined in accordance with the terms of this Section 3.4, the
Buyer and the Sellers shall cooperate with each other in good faith to contest such taxing authority’s allocation (or proposed allocation);
provided, however, that after consultation with the Parties adversely affected by such allocation (or proposed allocation), the other Parties hereto
may file such protective claims or returns as may reasonably be required to protect their interests.

4.    CLOSING.

4.1.    Time and Place. The closing of the transfer and delivery of all documents and instruments necessary to
consummate the transactions contemplated by this Agreement (the “Closing”) shall be held at the offices of Buchanan Ingersoll &
Rooney PC, One Oxford Centre, 20th Floor, 301 Grant Street, Pittsburgh, PA 15219 at 10:00 a.m. on a mutually acceptable date not more than four
Business Days after the satisfaction of all conditions set forth in Sections 8 and 9 hereof, or at such other place or time as the Buyer and the
Company may agree. The date on which the Closing is actually held hereunder is sometimes referred to herein as the “Closing Date” and
the Closing shall be deemed to have occurred as of 12:01 a.m. (Eastern Time) on the Closing Date.

4.2.    Transactions at Closing. At the Closing:

(a)    The
Sellers shall duly execute and deliver to the Buyer such bills of sale, certificates of title or any other instruments of assignment and transfer with
respect to the Acquired Assets as the Buyer may reasonably request and/or as may reasonably be necessary to vest in the Buyer valid and enforceable
title to all of the Acquired Assets, in each case subject to no Encumbrance other than Permitted Encumbrances (as defined in Section
5.9).

(b)    The
Buyer shall duly execute and deliver to the Sellers such instruments of assumption and other documents with respect to the Assumed Obligations as the
Sellers may reasonably request and/or as may reasonably be necessary for Buyer to assume and agree to perform all obligations and liabilities of
Sellers arising under the Assumed Obligations, including but not limited to posting on the Closing Date any letter of credit, security deposit or
similar payments required to be paid by the tenant under the Real Property Leases in an amount or amounts not to exceed the amount or amounts
previously posted by the Sellers under each such Real Property Lease.

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(c)    Buyer
shall pay to the Sellers the amount of cash set forth in Section 3.1 above by wire transfer of immediately available funds to such bank account of the
Company as it may designate in writing prior to the Closing Date and deliver to Sellers the Note, accompanied by the executed Security Agreement (as
defined in Section 9.6) and the Guaranty (as defined in Section 9.5) and any other instruments of Buyer and Guarantor as may be reasonably necessary to
vest in the Company a valid and enforceable continuing security interest in the portion of the Acquired Assets constituting collateral under the
Security Agreement and a valid and enforceable guaranty of all amounts payable under the Note.

4.3.    Required Consents. (a) If any of the Required Consents (as defined in Section 7.1.12) have not yet been
obtained (or otherwise are not in full force and effect) as of the Closing, in the case of each Acquired Asset as to which such Material Consents were
not obtained (or otherwise are not in full force and effect) (the “Restricted Material Contracts”), the Buyer may waive Buyer’s
closing condition as to any such Required Consent and, if the Sellers’ waive the condition to closing set out in Section 9.11,
either:

(i)    elect
to have the Sellers continue its efforts to obtain the Required Consents; or

(ii)    elect
to have the Sellers retain that Restricted Material Contract and all liabilities arising therefrom or relating thereto.

If, pursuant to this Section 4.3,
the Buyer elects to have the Sellers continue their efforts to obtain any Required Consents and the Closing occurs, notwithstanding Sections 1 and 2
hereof, neither this Agreement nor any assignment and assumption agreement nor any other document related to the consummation of the transactions
contemplated by this Agreement shall constitute a sale, assignment, assumption, transfer, conveyance or delivery or an attempted sale, assignment,
assumption, transfer, conveyance or delivery of the Restricted Material Contracts, and following the Closing, the Parties shall use their commercially
reasonable efforts, and cooperate with each other, to obtain the Required Consent relating to each Restricted Material Contract as quickly as
practicable. Pending the obtaining of such Required Consents relating to any Restricted Material Contract, the Parties shall cooperate with each other
in any reasonable and lawful arrangements designed to provide to the Buyer the benefits of use of the Restricted Material Contract for its term (or any
right or benefit arising thereunder, including the enforcement for the benefit of the Buyer of any and all rights of the Sellers against a third party
thereunder). Once a Required Consent for the sale, assignment, assumption, transfer, conveyance and delivery of a Restricted Material Contract is
obtained, Sellers shall promptly assign, transfer, convey and deliver such Restricted Material Contract to the Buyer, and the Buyer shall assume the
obligations under such Restricted Material Contract assigned to the Buyer from and after the date of assignment to the Buyer pursuant to a
special-purpose assignment and assumption agreement (which special-purpose agreement the Parties shall prepare, execute and deliver in good faith at
the time of such transfer, all at no additional cost to the Buyer).

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(b)    If
there are any consents other than the Required Consents necessary for the assignment and transfer of any Acquired Assets to the Buyer (the
“Nonmaterial Consents”) which have not yet been obtained (or otherwise are not in full force and effect) as of the Closing, the Buyer
shall elect at the Closing, in the case of each of the Acquired Assets as to which such Nonmaterial Consents were not obtained (or otherwise are not in
full force and effect) (the “Restricted Nonmaterial Contracts”), whether to:

(i)    accept
the assignment of such Restricted Nonmaterial Contract, in which case, as between the Buyer and the Sellers, such Restricted Nonmaterial Contract
shall, to the maximum extent practicable and notwithstanding the failure to obtain the applicable Nonmaterial Consent, be transferred at the Closing to
the Buyer under this Agreement; or

(ii)    reject the assignment of such Restricted Nonmaterial Contract, in which case, notwithstanding Sections 1 and 2 of
this Agreement, (A) neither this Agreement nor any assignment and assumption agreement nor any other document related to the consummation of the
Transactions contemplated by this Agreement shall constitute a sale, assignment, assumption, conveyance or delivery or an attempted sale, assignment,
assumption, transfer, conveyance or delivery of such Restricted Nonmaterial Contract, and (B) the Sellers shall retain such Restricted Nonmaterial
Contract and all liabilities arising therefrom or relating thereto.

4.4.    Proration.

(a)    Except
as herein otherwise provided, on the Closing Date, or as promptly as practicable following the Closing Date, but in no event later than 60 day
thereafter, the real and personal property taxes, water, gas, electricity and other utilities, common area maintenance reimbursement to lessors,
deposits, royalties, local business and other license fees or taxes, interest charges, merchant’s association dues and other similar periodic
charges payable with respect to the Acquired Assets or the Business shall be prorated between Buyer and Sellers effective as of the Closing
Date.

(b)    Sellers shall pay rent under the Real Property Lease through the end of the calendar month in which the Closing
Date occurs, and on the Closing Date, Buyer shall reimburse Seller for such rent accrued from the Closing Date through the end of the month as part of
the post-Closing proration.

5.    REPRESENTATIONS AND WARRANTIES OF THE SELLERS. As a material inducement to the Buyer and Guarantor to enter into
this Agreement and consummate the transactions contemplated hereby, the Sellers jointly and severally represent and warrant to the Buyer as follows,
except as specifically contemplated by this Agreement, the Transaction Documents and/or the Distributor Agreement (as defined in Section 13) and except
set forth in the Sellers’ disclosure schedules, which shall be arranged so as to correspond to the numbered representation that it modifies and
which information so disclosed shall be deemed to modify the representation or warranty to

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which it corresponds or is
cross-referenced only (each a “Schedule” and collectively, the “Schedules”):

5.1.    Organization of Seller; Authority. The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Washington. Each Seller is duly qualified and in good standing as a foreign corporation in all
jurisdictions in which the character of the properties owned or leased or the nature of the activities conducted by it makes such qualification
necessary, except where any such failure would not reasonably be expected to have a Material Adverse Effect (as defined in Section 13). Each Seller has
delivered or made available to the Buyer complete and correct copies of its Articles or Certificate of Incorporation, as the case may be, and By-Laws
and all amendments thereto, and no amendments thereto are pending or under consideration by the Seller. Sellers are not in violation of any term of
their Articles or Certificate of Incorporation. Each Seller has all requisite corporate power and corporate authority to own and hold the Acquired
Assets owned or held by it, to carry on the Business as such business is now conducted and to execute and deliver this Agreement and the other
documents, instruments and agreements contemplated hereby or thereby (collectively, the “Transaction Documents”) to which it is a
party and to carry out all actions required of it pursuant to the terms of the Transaction Documents, except where any such failure would not
reasonably be expected to have a Material Adverse Effect. Eden Bioscience Corporation of New York, Inc. and Eden Bioscience International, Inc.,
subsidiaries of the Company not named as Sellers, are shell corporations that owns no assets and conducts no business.

5.2.    Corporate Approval; Binding Effect. Each Seller has obtained all necessary authorizations and approvals
from its Board of Directors required for the execution and delivery of the Transaction Documents to which it is a party and the consummation of the
transactions contemplated hereby and thereby. As of the Closing, each Seller shall have obtained all necessary authorizations and approvals from its
shareholders required for the execution and delivery of the Transaction Documents to which it is a party and the consummation of the transactions
contemplated hereby and thereby. Each of the Transaction Documents has been duly executed and, when delivered by Sellers in accordance with the terms
hereof and thereof, will constitute the legal, valid and binding obligation of each Seller enforceable against such Seller in accordance with its
terms, except as the enforceability thereof may be limited by any applicable bankruptcy, reorganization, insolvency or other laws affecting
creditors’ rights generally or by general principles of equity.

5.3.    Non-Contravention. The execution and delivery by Sellers of the Transaction Documents and, subject to
receipt of required shareholder approvals, the consummation by the Sellers of the transactions contemplated hereby and thereby will not (a) violate or
conflict with any provision of the Articles or Certificate of Incorporation or By-Laws of any Seller, as amended to date; or (b) constitute a violation
of, or be in conflict with, or constitute or create a default under, or result in the creation or imposition of any Encumbrance upon any property of
Seller (including without limitation any of the Acquired Assets) pursuant to (i) any agreement or instrument to which any Seller is a
party

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or by which any Seller or any
of its properties (including without limitation any of the Acquired Assets) is bound or to which any Seller or any of such properties is subject, or
(ii) any statute, judgment, decree, order, regulation or rule of any court or governmental or regulatory authority binding on any Seller, except in the
case of clause (b) for such violations, conflicts, defaults and Encumbrances as could not reasonably be expected to have a Material Adverse
Effect.

5.4.    Governmental Consents; Transferability of Licenses, Etc. Except as set forth on Schedule 5.4, no
consent, approval or authorization of, or registration, qualification or filing with, any governmental agency or authority is required for the
execution and delivery by any Seller of the Transaction Documents to which it is a party or for the consummation by any Seller of the transactions
contemplated hereby or thereby, other than such as have been obtained or made. The Sellers have and maintain, and the Permits listed on Schedule
1.1(f) hereto include, all licenses, permits and other authorizations from all governmental authorities as are necessary for the conduct of the
Business as it is now being conducted or in connection with the ownership or current use of the Acquired Assets, except for such licenses, permits and
other authorizations the lack of which would not reasonably be expected to have a Material Adverse Effect. Except as expressly designated on
Schedule 5.4, all of the Permits listed on Schedule 1.1(f) are transferable to the Buyer, and true and complete copies of the Permits
listed on Schedule 1.1(f) have previously been delivered or made available to the Buyer.

5.5.    Financial Statements. The Company has delivered the following financial statements (the “Financial
Statements”) to the Buyer: (i) the audited consolidated balance sheets of the Company and its subsidiaries as of December 31, 2004 and 2005
(the “Audited Balance Sheets”), and the related consolidated statements of operations and cash flows of the Company and its
subsidiaries for the fiscal years then ended (together with the Audited Balance Sheets, collectively, the “Audited Financials”), and
(ii) the unaudited consolidated balance sheet of the Company and its subsidiaries as of September 30, 2006 (the “Interim Balance
Sheet”) and the related unaudited consolidated statements of operations and cash flows of the Company and its subsidiaries for the period then
ended (together with the Interim Balance Sheet, collectively, the “Interim Financials”). Each of the Financial Statements have been
prepared in accordance with generally accepted accounting principles accepted in the United States (“GAAP”), consistently applied;
during the periods involved (except (i) as may be otherwise indicated in the Financial Statements or the notes thereto, or (ii) in the case of Interim
Financials, to the extent that they may not include footnotes, may be condensed or summary statements or may conform to the Securities and Exchange
Commission’s (“SEC”) rules and instructions for Reports on Form 10-Q). Each of the Audited Balance Sheets and the Interim Balance
Sheets fairly presents the consolidated financial condition of the Company and its subsidiaries as of its respective date; and each of the statements
of operations and cash flows included in the Audited Financials and the Interim Financials fairly presents the consolidated results of operations and
cash flows of the Company and its subsidiaries for the periods then ended (subject, in the case of Interim Financials, to normal recurring year-end
adjustments).

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5.6.    Absence of Certain Changes. Except as set forth on Schedule 5.6 or except as would not reasonably be
expected to have a Material Adverse Effect, since the date of the Interim Financials each of the Sellers has carried on the Business only in the
ordinary course (as defined in Section 13), and there has not been with respect to the Business: (a) any change in the assets, liabilities, sales,
income or business of the Sellers, or in their relationships with suppliers, customers or lessors, other than changes in the ordinary course of
business; (b) any acquisition or disposition by Sellers of any asset or property other than in the ordinary course of business; (c) any damage,
destruction or loss, whether or not covered by insurance, adversely affecting, in the aggregate, the property or business of the Sellers; (d) any
declaration, setting aside or payment of any dividend or any other distributions in respect of the Company’s capital stock; (e) any increase in
the compensation, pension or other benefits payable or to become payable by the Sellers to any of their directors, officers, employees or consultants,
or any bonus payments or arrangements made to or with any of them (other than pursuant to the terms of any existing written agreement or plan of which
the Buyer has been supplied complete and correct copies ); (f) any forgiveness or cancellation of any debt or claim by the Sellers or any waiver of any
right of material value other than compromises of accounts receivable in the ordinary course of business; (g) any entry by the Sellers into any
transaction other than in the ordinary course of business; (h) any incurrence by the Sellers of any obligations or liabilities, whether absolute,
accrued, contingent or otherwise (including, without limitation, liabilities as a guarantor or otherwise with respect to obligations of others), other
than obligations and liabilities incurred in the ordinary course of business; (i) any mortgage, pledge, lien, lease, security interest or other charge
or encumbrance on any of the assets, tangible or intangible, of the Sellers, other than in the ordinary course of business; or (j) any discharge or
satisfaction by the Sellers of any lien or encumbrance or payment by the Sellers of any obligation or liability (fixed or contingent) other than (A)
current liabilities included in the Interim Balance Sheet and (B) current liabilities incurred since the date of the Interim Balance Sheet in the
ordinary course of the Business.

5.7.    Litigation. Except as set forth on Schedule 5.7 hereto, no action, suit, proceeding or investigation
is pending or, to the knowledge of the Sellers, threatened, relating to or affecting any of the Acquired Assets or the Business, nor, to the knowledge
of the Sellers, has any event occurred that is reasonably likely to give rise to or serve as a basis for the commencement of any such action, suit,
proceeding or investigation. No action, suit, proceeding or investigation is pending or, to the knowledge of the Sellers, threatened, which questions
the validity of the Transaction Documents or challenges any of the transactions contemplated hereby or thereby, nor, to the knowledge of the Sellers,
has any event occurred that is reasonably likely to give rise to or serve as a basis for the commencement of any such action, suit, proceeding or
investigation.

5.8.    Conformity to Law. Except as set forth on Schedule 5.8 or except where any such noncompliance has
been cured or would not reasonably be expected to have a Material Adverse Effect, the Sellers have complied with, and are in compliance with (a) all
laws, statutes, governmental regulations and all judicial or administrative tribunal orders, judgments, writs, injunctions, decrees or similar commands
applicable to the Business or any of the Acquired Assets (including, without limitation, any labor, environmental,

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occupational health, zoning
or other law, regulation or ordinance) and (b) all terms and provisions of all contracts, agreements and indentures of the Business to which any of the
Sellers is a party, or by which the Business or any of the Acquired Assets is subject. Except as set forth in Schedule 5.8 hereto, the Sellers
have not committed, been charged with, or, to the knowledge of the Sellers, are or have been under investigation with respect to, nor to the knowledge
of Sellers does there exist, any violation of any provision of any federal, state or local law or administrative regulation which would reasonably be
expected to have a Material Adverse Effect.

5.9.    Title to Acquired Assets. Except as set forth on Schedule 5.9, the Sellers have valid and
enforceable title or interest in or to all of the Acquired Assets, and have the full right to sell, convey, transfer, assign and deliver the Acquired
Assets, without the need to obtain the consent or approval of any third party. Except for Permitted Encumbrances (as defined below), all of the
Acquired Assets are free and clear of any security interests, liens, claims, charges, options, mortgages, debts, leases (or subleases), conditional
sales agreements, title retention agreements, encumbrances of any kind, material defects as to title or restrictions against the transfer or assignment
thereof (collectively, “Encumbrances”). Except as set forth on Schedule 5.9 and except for the Equipment and tangible personal
property held by the Sellers under the Personal Property Leases, which Equipment and tangible personal property is in “as is, where is”
condition, to Seller’s knowledge, all of the Acquired Assets are in good condition and repair (reasonable wear and tear excepted) and are
reasonably adequate to carry on the Business on substantially the same basis as presently conducted; assuming however, that the Buyer provides the
necessary managerial, administrative and accounting personnel and systems to oversee and administer operation of the Business. At and as of the
Closing, the Sellers will convey the Acquired Assets to the Buyer by bills of sale, certificates of title and other instruments of assignment and
transfer effective in each case to vest in the Buyer, and the Buyer will have, valid and enforceable title or interest in or to all of the Acquired
Assets, free and clear of all Encumbrances other than (a) those identified in Schedule 5.9 ; (b) those for Taxes and other governmental
assessments or charges not yet due and payable or which are being contested in good faith and by appropriate proceedings; (c) any other Encumbrances
which in the aggregate relate to claims totaling less than $5,000, do not materially detract from the value or transferability of the property or
assets subject thereto or materially interfere with the present use and have no arisen other than in the ordinary course of business; and (d) rights,
claims, interests, restrictions and agreements of or with the landlords under the Real Property Leases and of or with the lessors under the Personal
Property Leases (“Permitted Encumbrances”).

5.10.    Leased Real Property.

(a)    Leased Real Property.

(i)    Leases. The copies of the leases of the Leased Real Property (collectively, the “Leases”)
delivered by the Sellers to the Buyer and the information with respect to each of the Leases set forth in Schedule 1.1(a) is complete, accurate,
true and

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correct in all material
respects. With respect to each of the Leases, except as set forth on Schedule 1.1(a) or Schedule 5.10(a):

(A)    each
of the Leases is in full force and effect and has not been modified, amended or altered, in writing or otherwise;

(B)    to the
knowledge of Sellers, all obligations of the landlord or lessor under the Leases which have accrued have been performed, and, to the knowledge of the
Sellers, no landlord or lessor is in default under any Lease;

(C)    all
obligations of the tenant or lessee under the Leases have been performed, and the Sellers are not in default under any Lease, and no circumstance
presently exists which, with notice or the passage of time, or both, would give rise to a default by the Sellers;

(D)    the
Sellers will use its reasonable efforts to obtain prior to the Closing the consent of each landlord or lessor under any Leases whose consent is
required to the transfer of the Leased Real Property to the Buyer; and

(E)    the
Buyer will as of the Closing comply with Section 4.2(b).

(ii)    Title and Description. The Sellers hold a valid and enforceable leasehold interest in the Leased Real
Property pursuant to the Leases.

(iii)    Condition. Except as set forth on Schedule 5.10(a), to the Sellers’ knowledge, there are no
material defects in the physical condition of any improvements constituting a part of the Leased Real Property, including, without limitation,
structural elements, mechanical systems, roofs or parking and loading areas, and all of such improvements are in reasonably good operating condition
and repair, have been well maintained and are free from infestation by rodents or insects. Except as set forth on Schedule 5.10(a), to the
Seller’s knowledge, none of the Leased Real Property is subject to special flood or mudslide hazards. All water, sewer, gas, electric, telephone,
air conditioning, heating, drainage and other utilities required by law or necessary for the current operation of the Leased Real Property have been
installed and are reasonably sufficient to service the Leased Real Property in accordance with Sellers’ prior practice.

(iv)    Compliance with Law; Government Approvals. The Sellers have received no notice from any governmental
authority of any violation of any law, ordinance, regulation, license, permit or authorization issued with respect to any of the Leased Real Property
that has not been corrected or that will not be corrected prior to the Closing Date, and, to Sellers’ knowledge, no such violation now exists
which would reasonably be expected to have a Material Adverse Effect.. All improvements constituting a part of the Leased Real Property are in
compliance in all respects with all applicable laws, ordinances, regulations, licenses, permits and authorizations, and there are presently in effect
all licenses, permits and authorizations required by law, ordinance or regulation, except

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where such noncompliance or
failure to have in effect such license permit or authorization would not reasonably be expected to have a Material Adverse Effect. The Sellers have
received no notice of any pending or threatened material real estate tax deficiency or reassessment or condemnation of all or any portion of any of the
Leased Real Property.

5.11.    Environmental Matters

(a)    Except
as set forth on Schedule 5.11:

(i)    neither the Sellers, with respect to the Business, nor to the Sellers’ knowledge, any operator of any real
property presently or formerly owned, leased or operated by the Sellers in connection with the Business is in violation or alleged violation of any
judgment, decree, order, law, license, rule or regulation pertaining to environmental matters, including without limitation those arising under the
Resource Conservation and Recovery Act (“RCRA”), the Comprehensive Environmental Response, Compensation and Liability Act of 1980 as
amended (“CERCLA”), the Superfund Amendments and Reauthorization Act of 1986 (“SARA”), the Federal Water Pollution
Control Act, the Solid Waste Disposal Act, as amended, the Federal Clean Water Act, the Federal Clean Air Act, the Toxic Substances Control Act, or any
state or local statute, regulation, ordinance, order or decree relating to health, safety or the environment (collectively, “Environmental
Laws”);

(ii)    neither of the Sellers has, in connection with the Business, received notice from any third party, including
without limitation any federal, state or local governmental authority, (A) that the Sellers or any predecessor in interest has been identified by the
United States Environmental Protection Agency (“EPA”) as a potentially responsible party under CERCLA with respect to a site listed on
the National Priorities List, 40 C.F.R. Part 300 Appendix B (1986); (B) that any hazardous waste, as defined by 42 U.S.C. § 6903(5), any hazardous
substance as defined by 42 U.S.C. § 9601(14), any pollutant or contaminant as defined by 42 U.S.C. § 9601(33) or any toxic substance, oil or
hazardous material or other chemical or substance (including, without limitation, asbestos in any form, urea formaldehyde or polychlorinated biphenyls)
regulated by any Environmental Laws (collectively, “Hazardous Substances”) which the Sellers or any predecessor in interest has
generated, transported or disposed of has been found at any site at which a federal, state or local agency or other third party has conducted or has
ordered that the Sellers or any predecessor in interest conduct a remedial investigation, removal or other response action pursuant to any
Environmental Law; or (C) that the Sellers or any predecessor in interest is or shall be a named party to any claim, action, cause of action,
complaint, (contingent or otherwise), legal or administrative proceeding arising out of any third party’s incurrence of costs, expenses, losses or
damages of any kind whatsoever in connection with the Release of Hazardous Substances;

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(iii)    (A) to the Seller’s knowledge, no portion of any real property presently or formerly owned, leased or
operated by the Sellers in connection with the Business has been used for the handling, manufacturing, processing, storage or disposal of Hazardous
Substances except in accordance with applicable Environmental Laws; and to the Sellers’ knowledge, no underground tank or other underground
storage receptacle for Hazardous Substances is located on such properties; (B) in the course of any activities conducted by the Sellers or, to the
Sellers’ knowledge, operators of any real property presently or formerly owned, leased or operated by the Sellers in connection with the Business,
no Hazardous Substances have been generated or are being used on such properties except in accordance with applicable Environmental Laws; (C) to the
Seller’s knowledge, all real properties presently or formerly owned, leased or operated by the Sellers in connection with the Business are free
from contamination of every kind, including without limitation, groundwater, surface water, soil, sediment and air contamination, and such properties
do not contain any Hazardous Substances, except in each case to the extent that the presence of Hazardous Substances on such properties does not
violate any applicable Environmental Laws; (D) to the Sellers’ knowledge, there have been no Releases (which term, as used herein, shall include
any past or present releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, disposing or dumping,
collectively, a “Release”) or threatened Releases of Hazardous Substances on, upon, into or from any real property presently or
formerly owned, leased or operated by the Sellers in connection with the Business, except in accordance with applicable Environmental Laws; (E) to the
Sellers’ knowledge, there have been no Releases of Hazardous Substances on, upon, from or into any real property in the vicinity of any real
property presently or formerly owned, leased or operated by the Sellers in connection with the Business which, through soil or groundwater
contamination, may have come to be located on such real property except for Hazardous Substances whose presence on such real property does not violate
any applicable Environmental Laws; and (F) in addition, to the Sellers’ knowledge, any Hazardous Substances that have been generated on any real
property presently or formerly owned, leased or operated by the Sellers in connection with the Business have been transported offsite only by carriers
having identification numbers issued by the EPA and have been treated or disposed of only by treatment or disposal facilities maintaining valid permits
as required under applicable Environmental Laws, which transporters and facilities have been and are, to the best of the Sellers’ knowledge,
operating in compliance with such permits and applicable Environmental Laws; and

(iv)    to Sellers’ knowledge, no real property presently or formerly owned, leased or operated by the Sellers in
connection with the Business is or shall be subject to any applicable environmental cleanup responsibility law or environmental restrictive transfer
law or regulation, by virtue of the transactions set forth herein and contemplated hereby.

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(b)    Schedule 5.11 hereto sets out a list of all material documents, reports, site assessments, data,
communications or other materials, in the possession of any Seller, which contain any information with respect to potential environmental liabilities
associated with any real property presently or formerly owned, leased or operated by the Sellers and relating to compliance with Environmental Laws or
the environmental condition of such properties. The Sellers have made available to the Buyer complete and accurate copies of all of the documents,
reports, site assessments, data, communications and other materials listed on Schedule 5.11.

5.12.    Equipment. Schedule 1.1(b) hereto sets forth a complete and accurate list of all of the Equipment
existing as of September 13, 2006. The Personal Property Leases listed on Schedule 1.1(c) hereto include all leases by the Sellers of all items
of tangible personal property (other than Excluded Assets) reasonably necessary for operation of the Business as presently conducted. All Equipment and
tangible personal property held by the Sellers under the Personal Property Leases will be transferred to the Buyer in substantially the same “as
is, where is” condition existing as of the date hereof (additional ordinary wear and tear excepted).

5.13.    Inventories. Except as set forth on Schedule 5.13 and except for obsolete items and items
below-standard quality, all of which have been written off or written down to net realizable value in the Audited Balance Sheets or the Interim Balance
Sheet, all items included in the Inventories consist solely of, and the items included in the Inventories to be purchased by the Buyer hereunder will
consist solely of, material and goods of a quality and quantity which are usable or saleable in the ordinary course of Business as currently conducted
by Sellers. The Inventories are reasonably adequate for the present needs of the Business of Sellers, are fairly reflected on the books of account of
the Sellers, stating items of Inventory at the lower of cost or market value in accordance with GAAP, consistently applied, with adequate allowance for
excessive or obsolete inventories.

5.14.    Material Contracts. Schedule 5.14 sets forth a complete and accurate list of all material contracts with
respect to or relating to the Business to which any Seller is a party or by which any Seller is bound or to which any Seller or any of the Acquired
Assets is subject. As used in this Section 5.14, the word “contract” means and includes every agreement or understanding of any kind,
written or oral, enforceable or not and specifically includes (a) contracts and other agreements for the provision of products or services by the
Sellers; (b) contracts and other agreements for the sale of any of the Sellers’ assets or properties other than in the ordinary course of business
or for the grant to any person of any preferential rights to purchase any of the Sellers’ assets or properties; (c) joint venture agreements
relating to the Business or by or to which any of the Acquired Assets are affected or subject; and (d) any other contract or other agreement not made
in the ordinary course of business. The Sellers have made available to the Buyer true, correct and complete copies of all such material contracts,
together with all modifications and supplements thereto. Each of the Acquired Contracts is in full force and effect in accordance with its terms, the
Sellers are not in breach of any of the material provisions of any such contract, nor, to the knowledge of any Seller, is any other party to any
such

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contract in default
thereunder, nor does any event or condition exist which with notice or the passage of time or both would constitute a material default thereunder. The
Sellers have in performed all material obligations required to be performed by them to date under each Acquired Contract. Subject to obtaining any
necessary consents of the other party or parties to any such Acquired Contract (the requirement of any such consent being reflected on Schedule
5.14) and except as set out in Schedule 5.14, no such contract (a) includes any provision the effect of which would be to materially enlarge
or accelerate any obligations of the Buyer to be assumed thereunder or give material additional rights to any other party thereto or will materially
adversely affect the Business as presently conducted by the Sellers, or (b) contains any material provision which would terminate or lapse by reason of
the transactions contemplated by this Agreement.

5.15.    Intellectual Property.

(a)    Schedule 1.1(g) and Schedule 1.2(l) (Domain Names) hereto set forth a complete and accurate list of (i) all
material patents, trademarks, trade names, domain names and copyrights used in the Business and registered in the name of the Sellers, and all
applications therefor (collectively, the “Registered Intellectual Property”); (ii) Schedule 1.1(g) hereto sets out all material
Intellectual Property which the Sellers are licensed or authorized by others to use in connection with the Business (the “Licensed Intellectual
Property”); and (iii) Schedule 1.1(g) hereto sets out all material Intellectual Property used in the Business which the Sellers have licensed
or authorized others to use (the “Licensor Intellectual Property”).

(b)    Except
as set forth in Schedule 5.15(b) and except as would not have a Material Adverse Effect, the Sellers own or have the sole and exclusive right to
use all Assigned Intellectual Property and have the right to use the Licensed Intellectual Property used in the ordinary course of the Business as
presently conducted. Upon the consummation of the transactions contemplated by this Agreement, and subject to receipt of all consents required to
assign to Buyer (i) all Assigned Intellectual Property and (ii) all licenses or other authorizations to use the Licensed Intellectual Property, Buyer
shall have the right to use the Assigned Intellectual Property and Licensed Intellectual Property in the ordinary course of the Business as presently
conducted. Sellers agree to cooperate in placing the Assigned Intellectual Property in the name of Buyer. No claims have been asserted against the
Sellers, and to the knowledge of the Sellers no claims are pending, by any person that may affect the use of any Assigned Intellectual Property or
Licensed Intellectual Property, or challenging or questioning the validity or effectiveness of any material license or agreement pertaining to the
Assigned Intellectual Property, and, except as set forth in Schedule 5.15(b), to the knowledge of the Sellers, there is no basis for such claim.
Except as set forth in Schedule 5.15(b), to the Sellers’ knowledge, the use by the Sellers of the Assigned Intellectual Property and the
Licensed Intellectual Property in the ordinary course of the Business as currently conducted by the Sellers does not infringe on the rights of any
person.

(c)    The
Sellers have the legal right to grant licenses or sublicenses with respect to all the Licensor Intellectual Property that the Sellers have licensed or
authorized

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others to use. All licenses
or other agreements pursuant to which the Sellers have granted licenses or authorized others to use any Licensor Intellectual Property are, unless they
have expired according to their terms, in full force and effect, and, to the knowledge of the Sellers, there is no default by any party thereto. To the
Sellers’ knowledge, the licenses granted by the Sellers with respect to the Licensor of Intellectual Property do not infringe on the rights of any
person.

(d)    Except
as set forth in Schedule 5.15(d) and except as would not have a Material Adverse Effect, all of the Registered Intellectual Property that is
Assigned Intellectual Property has been duly registered in, filed in or issued by the United States Patent and Trademark Office, the United States
Register of Copyrights, or the corresponding offices of other jurisdictions as identified on Schedule 1.1(g), and has been maintained and
renewed in accordance with all applicable provisions of law and administrative regulations of the United States and each such other
jurisdiction.

(e)    Except
as set forth in Schedule 5.15(e), the Sellers have taken commercially reasonable steps to establish and preserve their Intellectual Property
Rights with respect to the Assigned Intellectual Property used in the operation of the Business as currently conducted by the Sellers. Except as set
forth in Schedule 5.15(e), the Sellers have required all professional and technical employees employed in the Business, and other such employees
and consultants having access to valuable nonpublic information of the Sellers, to execute agreements under which such employees or consultants are
required to convey to the Sellers ownership of all inventions and developments conceived or created by them in the course of their employment or
engagement with the Sellers and to maintain the confidentiality of all such information of the Sellers. Except as set forth in Schedule 5.15(e),
the Sellers have not made such information available to any person other than employees or consultants of the Sellers, except pursuant to written
agreements requiring the recipients to maintain the confidentiality of such information and appropriately restricting the use thereof.

5.16.    Suppliers and Customers. Schedule 5.16 hereto sets forth the ten (10) largest suppliers of the
Business based on purchases by the Business, and the ten (10) largest customers of the Business based on sales by the Business, for the period ending
on December 31, 2005. The relationships of the Sellers with such suppliers and customers are, to Sellers’ knowledge, good commercial working
relationships and, except as set forth on Schedule 5.16, no supplier or customer of material importance to the Business has cancelled or
otherwise terminated, or threatened in writing to cancel or otherwise to terminate, its relationship with the Sellers or has during the last twelve
(12) months decreased materially, or threatened in writing to decrease or limit materially, its services, supplies or materials for use in the Business
or its usage or purchase of the services or products of the Sellers, except for normal cyclical changes related to such suppliers’ or
customers’ businesses. Except as set forth on Schedule 5.16, no Seller has any knowledge that any such supplier or customer intends to
cancel or otherwise substantially modify its relationship with the Sellers or to decrease materially or limit its services, supplies or materials to
the Sellers, or its usage or purchase of the Sellers’ services or products, and to the knowledge of the Sellers, the consummation of the
transactions contemplated hereby

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would not reasonably be
expected to materially adversely affect the post-Closing relationship of Buyer with any customer or supplier of the Sellers relating to the
Business.

5.17.    Adequacy of Acquired Assets. The Acquired Assets are reasonably adequate to conduct the Business on
substantially the same basis as currently conducted by the Sellers, assuming, however, that the Buyer provides the necessary managerial, administrative
and accounting personnel and systems to oversee and administer the operation of the Business.

5.18.    No Undisclosed
Liabilities. Except to the extent (a) reflected or reserved against in the Interim Balance Sheet, (b) incurred in the ordinary course of the
Business after the date of the Interim Balance Sheet, or (c) described on any Schedule hereto, the Sellers are not subject to any liabilities or
obligations of any nature, whether accrued, absolute, contingent or otherwise in connection with the Business (including without limitation as
guarantors or otherwise with respect to obligations of others), other than liabilities and obligations in connection with the Business that would not
be required to be reflected or reserved against on a balance sheet prepared in accordance with GAAP.

5.19.    Taxes. The Sellers have duly filed (or have obtained an extension of time within which to file) with the
appropriate government agencies all of the income, sales, use, employment and other Tax returns and reports required to be filed by it. No waiver of
any statute of limitations relating to Taxes has been executed or given by the Sellers. All Taxes, assessments, fees and other governmental charges
upon the Sellers or upon any of its properties, assets, revenues, income and franchises which are owed by the Sellers with respect to any period ending
on or before the Closing Date have or will be paid, other than those currently payable without penalty or interest, those being contested in good
faith, or those the non-payment of which would not reasonably be expected to have a Material Adverse Effect. The Sellers have withheld and paid all
Taxes required to be withheld or paid in connection with amounts paid or owing to any employee, creditor, independent contractor or third party. No
federal Tax return of the Sellers is currently under audit by the IRS, and no other Tax return of the Sellers is currently under audit by any other
taxing authority. Neither the IRS nor any other taxing authority is now asserting or, to Sellers’ knowledge, threatening to assert against the
Sellers any deficiency or claim for additional Taxes or interest thereon or penalties in connection therewith or any adjustment that would have
Material Adverse Effect.

5.20.    Broker. None of the Sellers has retained, utilized or been represented by any broker, agent, finder or
intermediary in connection with the negotiation or consummation of the transactions contemplated by this Agreement, and neither of the Sellers has
incurred or become liable for any broker’s commission or finder’s fee relating to or in connection with the transactions contemplated by this
Agreement.

5.21    Accredited Investor. The Company is an accredited investor as that term is defined in Rule 501 under the
Securities Act of 1933, as amended.

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5.22    Disclosure. Subject to Section 5.23 below, no representation or warranty by any Seller in this Section 5
contains at the time made any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make
the statements contained therein not misleading.

5.23.    No Other Representations and Warranties.

(a)    Except
for the representations and warranties of the Sellers contained in this Section 5, Sellers make no other representations and warranties, written or
oral, statutory, express, or implied. Buyer and Guarantor acknowledge that except as expressly provided in this Agreement, Sellers have not made, and
Sellers hereby expressly disclaim and negate, and the Buyer and Guarantor hereby expressly waive, any representation or warranty, express or implied,
at common law, by statute, or otherwise relating to, and the Buyer and Guarantor hereby expressly waive and relinquish any and all rights, claims and
causes of action against the Sellers and their representatives in connection with the accuracy, completeness or materiality of, any information, data
or other information (written or oral) heretofore furnished to Buyer and Guarantor and each of their representatives by and on behalf of
Sellers.

(b)    In
connection with the Buyer’s investigation of the Business of the Sellers, the Buyer and Guarantor may have received or may receive from or on
behalf of the Sellers certain projections or forward-looking statements, including projected statements of operating revenues and income from
operations. The Buyer and Guarantor each acknowledge that there are uncertainties inherent in attempting to make such estimates, projections and other
forecasts and plans, and the Buyer and Guarantor each is taking full responsibility for making its own evaluation of the adequacy and accuracy of all
estimates, projections and other forecasts and plans so furnished to it, including the reasonableness of the assumptions underlying such estimates,
projections and forecasts. Accordingly, the Sellers make no representation or warranty with respect to such estimates, projections, forward looking
statements and other forecasts and plans (including the reasonableness of the assumptions underling such estimates, projections and other forecasts and
plans).

6.    REPRESENTATIONS AND WARRANTIES OF THE BUYER AND GUARANTOR. As a material inducement to the Sellers to enter into
this Agreement and consummate the transactions contemplated hereby, the Buyer and Guarantor jointly and severally represent and warrant to each Seller
as follows, except as specifically contemplated by this Agreement, the Transaction Documents and/or the Distributor Agreement:

6.1.    Organization of Buyer and Guarantor; Authority. The Buyer is a corporation duly organized, validly existing
and presently subsisting under the laws of the state of Pennsylvania. Guarantor is a corporation duly incorporated and registered in England and Wales
under the Companies Act 1985. Each of Buyer and Guarantor has delivered or made available to the Buyer complete and correct copies of its Articles or
Certificate of Incorporation, as the case may be, and By-Laws and all amendments thereto, and no

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amendments thereto are
pending or under consideration by the Buyer or Guarantor. Buyer and Guarantor are not in violation of any term of their Articles or Certificate of
Incorporation. Buyer and Guarantor each has all requisite corporate power and corporate authority to own and hold all property owned or held by it, to
carry on its business as such business is now conducted and to execute and deliver this Agreement and the Transaction Documents to which it is a party,
including but not limited to the Note, the Security Agreement, the Guaranty and the Supply Agreement, and to carry out all actions required of it
pursuant to the terms of the Transaction Documents, except where any such failure would not reasonably be expected to have a Material Adverse
Effect.

6.2.    Corporate Approval; Binding Effect. The Buyer and Guarantor each has obtained all necessary authorizations
and approvals from its Board of Directors and stockholders required for the execution and delivery of the Transaction Documents to which it is a party
and the consummation of the transactions contemplated hereby and thereby. Each of the Transaction Documents to which the Buyer or Guarantor is a party
has been duly executed and delivered by the Buyer or Guarantor, as the case may be, and constitutes the legal, valid and binding obligation of each of
the Buyer or Guarantor, enforceable against the Buyer or Guarantor in accordance with its terms, except as enforceability thereof may be limited by any
applicable bankruptcy, reorganization, insolvency or other laws affecting creditors’ rights generally or by general principles of
equity.

6.3.    Non-Contravention. The execution and delivery by each of the Buyer and Guarantor of the Transaction
Documents to which it is a party and the consummation by the Buyer and Guarantor of the transactions contemplated hereby and thereby will not (a)
violate or conflict with any provisions of the Certificate of Incorporation or By-Laws of the Buyer or Guarantor, each as amended to date; or (b)
constitute a violation of, or be in conflict with, constitute or create a default under, or result in the creation or imposition of any Encumbrance
upon any property of the Buyer or Guarantor (including without limitation the Acquired Assets to be pledged as collateral under the Security Agreement)
pursuant to (i) any agreement or instrument to which the Buyer or Guarantor is a party or by which the Buyer or Guarantor or any of its properties is
bound or to which the Buyer or Guarantor or any of its properties is subject (including without limitation the Acquired Assets to be pledged as
collateral under the Security Agreement), or (ii) any statute, judgment, decree, order, regulation or rule of any court or governmental authority to
which the Buyer or Guarantor is subject, except in the case of clause (b) for such violations, conflicts, defaults and Encumbrances as could not
reasonably be expected to have a Material Adverse Effect.

6.4    Governmental Consents. No consent, approval or authorization of, or registration, qualification or filing
with, any governmental agency or authority is required for the execution and delivery by each of the Buyer and Guarantor of the Transaction Documents
to which it is a party or for the consummation by the Buyer and Guarantor of the transactions contemplated hereby or thereby. The Buyer and Guarantor
have and maintain all licenses, permits and other authorizations from all governmental authorities as are necessary for the conduct of their respective
businesses or in connection with the

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ownership of their respective
properties, except for such licenses, permits and authorizations as would not reasonably be expected to have a Material Adverse
Effect.

6.5.    Financial Statements. The Guarantor has delivered the following financial statements (the “Buyer
Financial Statements”) to the Company: (i) the audited consolidated balance sheets of the Guarantor and its subsidiaries as of December 31,
2005 (the “Buyer Audited Balance Sheet”), and the related consolidated statements of operations of the Guarantor and its subsidiaries for the
fiscal year then ended (together with the Buyer Audited Balance Sheet, collectively, the “Buyer Audited Financials”), and (ii) the
unaudited consolidated balance sheet of the Guarantor and its subsidiaries as of September 30, 2006 (the “Buyer Interim Balance
Sheet”) and the related unaudited consolidated statements of operations of the Guarantor for the period then ended (together with the Buyer
Interim Balance Sheet, collectively, the “Buyer Interim Financials”). Each of the Buyer Financial Statements has been prepared in
accordance with generally accepted accounting principles accepted in the United Kingdom (“UK GAAP”), consistently applied, during the
periods involved (except (i) as may be otherwise indicated in the Buyer Financial Statements or the notes thereto, or (ii) in the case of Buyer Interim
Financials, to the extent that they may not include footnotes). Each of the Buyer Audited Balance Sheet and the Buyer Interim Balance Sheet fairly
presents the consolidated financial condition of the Guarantor and its subsidiaries as of its respective date; and each of the statements of operations
included in the Buyer Audited Financials and the Buyer Interim Financials fairly presents the consolidated results of operations and cash flows of the
Guarantor and its subsidiaries for the periods then ended (subject, in the case of Buyer Interim Financials, to normal recurring year-end
adjustments).

6.6.    Absence of Certain Changes. Since the date of the Buyer Interim Financials, each of the Guarantor and Buyer
has carried on its business in the ordinary course, and there has not been with respect to such business: (a) any change in the assets, liabilities,
sales, income or business of the Guarantor or the Buyer, or in their respective relationships with suppliers, customer or lessors, other than changes
which were in the ordinary course of business; (b) any acquisition or disposition by Guarantor or the Buyer of any asset or property other than in the
ordinary course of business; (c) any damage, destruction or loss, whether or not covered by insurance, materially and adversely affecting, in the
aggregate, the property or business of the Guarantor, the Buyer or their subsidiaries; (d) any declaration, setting aside or payment of any dividend or
any other distribution in respect of the Guarantor’s capital stock; (e) any forgiveness or cancellation of any debt or claim by any of the
Guarantor, the Buyer or their subsidiaries or any waiver of any right of material value other than compromises of accounts receivable in the ordinary
course of business;(f) any incurrence by any of the Guarantor, the Buyer or their subsidiaries of any obligations or liabilities, whether absolute,
accrued, contingent or otherwise (including, without limitation, liabilities as a guarantor or otherwise with respect to obligations of others), other
than obligations and liabilities incurred in the ordinary course of business and the obligations contemplated by the Transaction Documents to which
Guarantor or Buyer are a party; (i) any mortgage, pledge, lien, lease, security interest or other charge or encumbrance on any of the assets, tangible
or intangible, of the Guarantor, the Buyer or their subsidiaries, other than in the ordinary course of business; (j) any discharge or

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satisfaction by any of the
Guarantor, the Buyer or their subsidiaries of any lien or encumbrance or payment by any of the Guarantor, the Buyer or their subsidiaries of any
obligation or liability (fixed or contingent) other than (A) current liabilities included in the Buyer Interim Balance Sheet and (B) current
liabilities incurred since the date of the Buyer Interim Balance Sheet in the ordinary course of business; or (h) any entry by Guarantor or the Buyer
or any of their subsidiaries into any transaction other than in the ordinary course of business and which could reasonably be expected to have a
Material Adverse Effect.

6.7.    Litigation. No action, suit, proceeding or investigation is pending or, to the knowledge of the Guarantor
and Buyer, threatened, against Guarantor or Buyer in which an adverse decision could reasonably be expected to have a Material Adverse Effect, nor, to
the knowledge of the Guarantor or Buyer, has any event occurred that is reasonably likely to give rise to or serve as a basis for the commencement of
any such action, suit, proceeding or investigation.

6.8    Conformity to Law. Except where any such noncompliance has been cured or would not reasonably be expected to
have a Material Adverse Effect, the Guarantor and the Buyer each has complied with, and is in compliance with (a) all laws, statutes, governmental
regulations and all judicial or administrative tribunal orders, judgments, writs, injunctions, decrees or similar commands applicable to its business
(including, without limitation, any labor, environmental, occupational health, zoning or other law, regulation or ordinance) and (b) all terms and
provisions of all contracts, agreements and indentures of its business to which either of the Guarantor or the Buyer is a party, or by which their
respective businesses or their respective properties are subject. The Guarantor and Buyer have not committed, been charged with, or, to the knowledge
of the Guarantor or Buyer, are or have been under investigation with respect to, nor to the knowledge of the Guarantor or Buyer does there exist, any
violation of any provision of any federal, state or local law or administrative regulation which would reasonably be expected to have a Material
Adverse Effect.

6.9.    No
Undisclosed Liabilities. Except to the extent (a) reflected or reserved against in the Buyer Interim Balance Sheet, (b) incurred in the ordinary
course of their respective businesses after the date of the Interim Balance Sheet, or (c) described on any Schedule hereto, the Guarantor and Buyer are
not subject to any liabilities or obligations of any nature, whether accrued, absolute, contingent or otherwise in connection with the their respective
businesses (including without limitation as guarantors or otherwise with respect to obligations of others), other than liabilities and obligations in
connection with such businesses that would not be required to be reflected or reserved against on a balance sheet prepared in accordance with UK
GAAP.

6.10.    Taxes. The Guarantor and Buyer each has duly filed (or has obtained an extension of time within which to
file) with the appropriate government agencies all of the income, sales, use, employment and other Tax returns and reports required to be filed by it.
No waiver of any statute of limitations relating to Taxes has been executed or given by the Guarantor or the Buyer. All Taxes, assessments, fees and
other governmental charges upon the Guarantor or the Buyer or upon any of their respective properties, assets,

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revenues, income and
franchises which are owed by the Guarantor and the Buyer with respect to any period ending on or before the Closing Date have or will be paid, other
than those currently payable without penalty or interest, those being contested in good faith, or those the non-payment of which would not reasonably
be expected to have a Material Adverse Effect. The Guarantor and the Buyer have withheld and paid all Taxes required to be withheld or paid in
connection with amounts paid or owing to any employee, creditor, independent contractor or third party. No federal Tax return of the Guarantor or the
Buyer is currently under audit by the IRS, and no other Tax return of the Guarantor or the Buyer is currently under audit by any other taxing
authority. Neither the IRS nor any other taxing authority is now asserting or, to Guarantor’s or Buyer’s knowledge, threatening to assert
against the Guarantor or Buyer any deficiency or claim for additional Taxes or interest thereon or penalties in connection therewith or any adjustment
that would have Material Adverse Effect.

6.11.    Broker. Neither the Buyer nor Guarantor has retained, utilized or been represented by any broker, agent,
finder or other intermediary in connection with the negotiation or consummation of the transactions contemplated by this Agreement, and the Buyer has
not incurred or become liable for any broker’s commission or finder’s fee relating to or in connection with the transactions contemplated by
this Agreement.

6.12    Disclosure. Subject to Section 6.13 below, no representation or warranty by any of Guarantor or Buyer or
their subsidiaries in this Section 6, contains at the time made any untrue statement of a material fact or omits to state a material fact required to
be stated therein or necessary to make the statements contained therein not misleading.

6.13    No
Other Representations and Warranties.

(a)    Except
for the representations and warranties of the Guarantor and Buyer contained in this Section 6 and in the Security Agreement and the Guaranty, Guarantor
and Buyer make no other representations and warranties, written or oral, statutory, express, or implied, Sellers acknowledge that except as expressly
provided in this Agreement, the Note, the Security Agreement, the Guaranty, and the Supply Agreement, Guarantor and Buyer has not made, and Guarantor
and Buyer hereby expressly disclaim and negate, and the Sellers hereby expressly waive, any representation or warranty, express or implied, at common
law, by statute, or otherwise relating to, and the Sellers hereby expressly waive and relinquish any and all rights, claims and causes of action
against the Guarantor and Buyer and their representatives in connection with the accuracy, completeness or materiality of, any information, data or
other information (written or oral) heretofore furnished to Sellers and each of their representatives by and on behalf of Guarantor and
Buyer.

(b)    In
connection with the Sellers’ investigation of the business of the Buyer and Guarantor, the Sellers may have received or may receive from or on
behalf of the Buyer and Guarantor certain projections or forward-looking statements, including projected statements of operating revenues and income
from operations. The Sellers acknowledge that there are uncertainties inherent in attempting to make such estimates,

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projections and other
forecasts and plans, and the Sellers each is taking full responsibility for making its own evaluation of the adequacy and accuracy of all estimates,
projections and other forecasts and plans so furnished to it, including the reasonableness of the assumptions underlying such estimates, projections
and forecasts. Accordingly, the Guarantor and Buyer make no representation or warranty with respect to such estimates, projections, forward-looking
statements and other forecasts and plans (including the reasonableness of the assumptions underlying such estimates, projections and forecasts and
plans).

7.    COVENANTS AND AGREEMENTS

7.1.    Conduct of Business by Sellers Pending Closing. Each Seller covenants and agrees that, from and after the
date of this Agreement and until the Closing, except as otherwise specifically consented to or approved by the Buyer in writing or except as
contemplated by this Agreement, the Transaction Documents and/or the Distributor Agreement:

7.1.1    Full Access. The Sellers shall afford to the Buyer and its authorized representatives full access during
normal business hours to all properties, assets, books, records, tax returns, financial information, contracts and documents of the Sellers and a full
opportunity to make such reasonable investigations as they shall desire to make of the Sellers or with respect to the Acquired Assets, and the Sellers
shall furnish or cause to be furnished to the Buyer and its authorized representatives all such information with respect to the Business and with
respect to the Acquired Assets as the Buyer may reasonably request.

7.1.2.    Carry on in Regular Course. The Sellers shall maintain the Acquired Assets in their current state of
repair and condition, excepting normal wear and tear or failure to replace consistent with Sellers’ past practice, and shall carry on the Business
in the ordinary course and shall not make or institute any unusual or novel methods of manufacture, purchase, sale, lease, management, accounting or
operation.

7.1.3.    No Dividends, Issuances, Repurchases, etc. The Sellers shall not declare or pay any dividends (whether in
cash, shares of stock or otherwise) on, or make any other distribution, directly or indirectly, in respect of any shares of their capital stock, or
issue, purchase, redeem or acquire for value any shares of their capital stock, except for the issuance or acquisition of shares of Company common
stock in connection with the exercise of Company stock options and warrants outstanding on the date of this Agreement.

7.1.4.    Contracts and Commitments. The Sellers shall not incur any Indebtedness other than in connection with
purchases of capital assets not in violation of Section 7.1.5 under lines of credit existing prior to the date of this Agreement, enter into any
contract or commitment or engage in any transaction with respect to the Business not in the ordinary course of business (other than this Agreement and
the Transaction Documents and the

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transactions contemplated
hereunder and thereunder), or for which disclosure would be required under Schedule 5.6 or 5.14.

7.1.5.    Purchase and Sale of Capital Assets. Other than pursuant to this Agreement, the Sellers shall not sell or
otherwise dispose of any capital asset constituting part of the Acquired Assets.

7.1.6.    Insurance. The Company shall maintain with financially sound and reputable insurance companies, funds or
underwriters adequate insurance for the Business of the kinds, covering such risks and in such amounts and with such deductibles and exclusions as are
customary for similarly situated companies in the Company’s industry.

7.1.7.    Preservation of Business Relationships. The Sellers shall use their commercially reasonable efforts to
preserve for the Buyer the present relationships of the Sellers’ suppliers, customers, independent contractors and others having business
relations with the Sellers in the Business; provided however, that neither this Section 7.1.7 nor any other provision of this Agreement shall be deemed
to require or obligate the Sellers to retain or keep available to the Buyer, or to prohibit or restrict the Sellers from terminating at any time, any
key officers and other employees of the Sellers employed in the Business.

7.1.8.    No Default. The Sellers shall not do any act or omit to do any act, or permit any act or omission to act,
which will cause a material breach of any contract, commitment or obligation of the Sellers material to the Business, including without limitation any
of the Real Property Leases, the Personal Property Leases, Permits or Assumed Contracts.

7.1.9.    Compliance with Laws. The Sellers shall comply in all material respects with all laws, regulations and
orders material to the Business or the Acquired Assets, or as may be reasonably required for the valid and effective transfer of the Acquired
Assets.

7.1.10.    Advice of Change. The Sellers will promptly advise the Buyer in writing of any Material Adverse
Change.

7.1.11.    Exclusive Dealing. Prior to the Closing:

(a)    The
Sellers shall not directly or indirectly, solicit, initiate, or encourage submission of proposals or offers from any persons relating to any
liquidation, dissolution, recapitalization, sale of stock representing 50% or more of the combined voting power of the Company’s voting equity
securities, merger, consolidation or acquisition of all or substantially all of the assets of the Company, or purchase of any equity interest in the
Company representing 50% or more of the combined voting equity power of the voting securities of the Company, or any other similar transaction or
business combination. Sellers shall cease immediately and cause to be terminated all contracts (other than confidentiality and nondisclosure agreements
to which the Company is a party as of the date hereof (each, an “Existing NDA”)), negotiations and communications with third parties with
respect to the foregoing, if any, existing on the date hereof.

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(b)    The
Sellers shall not participate, directly or indirectly, in any negotiations regarding, or furnish to any other person, any information with respect to,
or otherwise cooperate in any way with, or assist, any effort or attempt by any other person to do or seek any of the activities referred to in Section
7.1.11(a). Except to the extent prohibited by an Existing NDA, and the material terms and conditions thereof, should any Seller receive any proposal
inquiry or contact about any of the activities referred to in Section 7.1.11(a), the Company shall by the close of the next Business Day following give
oral or written notice thereof to Buyer and also promptly provide Buyer with the name of the person making such proposal, inquiry or
contact.

(c)    Notwithstanding the foregoing or any other provision of this Agreement or the Transaction Documents, at any time
prior to the date on which this Agreement is approved by the shareholders of the Company, in the event that the Board of Directors of the Company
determines in good faith by a majority vote, based on the advice of its outside legal counsel, that there is a reasonable basis requiring the Company
to consider a Favorable Third Party Offer (as defined below) to comply with its fiduciary duties, the Company may furnish non-public information with
respect to the Company and its subsidiaries to the person who made the Favorable Third Party Offer pursuant to a confidentiality agreement and
participate in discussions or negotiations with such person regarding the Favorable Third Party Offer. The Board of Directors of the Company may after
the third Business Day following the Company’s written notice to Buyer that specifies the material terms and conditions of the Favorable Third
Party Proposal, terminate this Agreement (and concurrently with such termination, if it so chooses, cause the Company to enter into any agreement with
respect to the Favorable Third Party Proposal) and withdraw any recommendation to the shareholders of the Company to approve the transactions
contemplated by this Agreement and the Transaction Documents.

(d)    As
used in this Agreement, “Favorable Third Party Proposal” means a written proposal from a credible, bona fide third party relating to
any direct or indirect acquisition or purchase of all or substantially all of the assets of the Company and its subsidiaries, taken as a whole, or 50%
or more of the equity securities of the Company, any tender offer or exchange offer that if consummated would result in any Person beneficially owning
50% or more of the combined voting power of the Company’s voting equity securities, or any merger, consolidation, business combination, share
exchange, recapitalization, liquidation, dissolution or similar transaction involving the Company or combined voting power of the Company, and
otherwise on terms which the Board of Directors of the Company determines in its good faith judgment, taking into account legal, financial, regulatory
and other aspects of the proposal deemed appropriate by the Board of Directors of the Company, to be more favorable to the shareholders of the Company
than the transactions contemplated by this Agreement (taking into account any amendments to this Agreement proposed by the Buyer in response to the
receipt by the Buyer of information about the proposal).

(e)    Nothing contained in this Section 7.1.11 shall (i) prohibit the Company from at any time taking and disclosing to
its shareholders a position contemplated by Rule 14d-9 or Rule 14e-2 promulgated under the Securities Exchange Act

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of 1934, as amended (the
“Exchange Act”) or making any disclosure required by Rule 14a-9 promulgated under the Exchange Act; or (ii) prohibit or limit the
Sellers from at any time engaging in the activities and transactions referred to in Section 7.1.11(a) in connection with the development and
implementation of the Sellers’ post-Closing business plan (assuming completion of the sale of the Acquired Assets and Business to the Buyer),
including but not limited to soliciting, initiating, encouraging submissions of proposals or offers for the sale, transfer, disposition, restructuring
or similar transactions relating to the Company’s home and garden business and/or other Excluded Assets.

7.1.12.    Consents of Third Parties. The Sellers will employ their commercially reasonable efforts to secure,
before the Closing Date, the consent, in form and substance reasonably satisfactory to the Buyer and the Buyer’s counsel, to the consummation of
the transactions contemplated by this Agreement by each party to any of the Personal Property Leases, Assumed Contracts, Licensed Intellectual
Property, Real Property Leases and transferable Permits under which such transactions would constitute a material default, would accelerate material
obligations of the Sellers or would permit cancellation of any such contract, including without limitation, the following consents (which consents
listed in clauses (a), (b) and (c) being referred to herein as the “Required Consents”) (a) Cornell Research Foundation, Inc. with
respect to the Exclusive License Agreement dated as of May 1, 1995 and subsequently amended (which such consent shall include a consent to the security
interest contemplated under the Security Agreement, as defined below, to the extent required or unless waived by the Sellers), and (b) S/I North Creek
I, LLC with respect to the lease with the Company dated May 29, 2001 (the “North Creek Lease”).

7.2.    Cooperation. The Parties will use their commercially reasonable efforts to cause the satisfaction of the
conditions precedent contained herein.

7.3    Proxy Statement; Shareholder Approval.

(a)    As
promptly as reasonably practicable following the date hereof, the Company, acting through its Board of Directors, shall, subject to and in accordance
with applicable law and its Restated Articles of Incorporation and Bylaws, and in all cases subject to Section 7.1.11(c) above, (i) duly call, give
notice of and hold a special meeting of the holders of the Company’s voting equity securities for the purpose of voting to approve the principal
terms of the transactions contemplated hereby and adopt and approve this Agreement; (ii) recommend to the shareholders of the Company that they vote in
favor of the matters described in the preceding clause (i); (iii) include in the proxy statement with respect to such meeting (the “Proxy
Statement”) such recommendation; and (iv) take all reasonable and lawful action to solicit and obtain such vote in favor of the matters
described in clause (i) above. The Proxy Statement will comply as to form in all material respects with the applicable provisions of Schedule
14A of the Securities Exchange Act of 1934, as amended.

(b)    The
Company will use its commercially reasonably efforts, and the Buyer and Guarantor will use its commercially reasonable efforts to cooperate with it,
to, as promptly as reasonably practicable following the date hereof, cause a preliminary Proxy

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Statement to be filed with
the SEC and, following clearance thereof by the SEC, cause a definitive Proxy Statement to be mailed to Company shareholders. Buyer and Guarantor shall
each shall use its commercially reasonably efforts to promptly respond to requests from the Company to assist the Company in responding to SEC comments
on information regarding the Buyer and the Guarantor required to be included in the Proxy Statement under applicable law or
regulation.

(c)    The
Buyer and the Guarantor shall provide to the Company such information for inclusion in the Proxy Statement regarding Buyer’s and Guarantor’s
business, financial condition, operations and prospects as the Company and its counsel reasonably determines is required under applicable rules and
regulations of the SEC. Any such information shall not contain any untrue statement of a material fact omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not false or
misleading.

(d)    Buyer
shall promptly inform the Company if any of the information supplied by Buyer or Guarantor for inclusion in the Proxy Statement to be mailed to the
shareholders of the Company in connection with the special meeting will, on the date the Proxy Statement (or any supplement or amendment thereto) is
first mailed to Company shareholders or at the time of the special meeting, contain any untrue statement of a material fact omit to state a material
fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not
false or misleading.

(e)    At or
prior to the Closing, the Company shall deliver to Buyer a certificate of its Secretary setting forth the voting results from its shareholder
meeting.

7.4    Employees. Buyer shall at the Closing assume the Change of Control Agreement between Dr. Zhongmin Wei and
the Company dated August 16, 2000 (the “Wei Contract”) and all obligations thereunder, including but not limited to the obligations
arising as a result of the Closing of the transactions contemplated hereby. Except with respect to Buyer’s assumption of the Wei Contract, Buyer
shall not be obligated to offer employment to any of the employees of Sellers. Any offers of employment made to any employees of the Sellers (other
than Dr. Wei) shall be subject to such hiring criteria as Buyer in its sole discretion may specify. Except with respect to Buyer’s assumption of
the Wei Contract, no employee of the Sellers shall become an employee of Buyer automatically as a result of the Closing of the transaction contemplated
hereby. Sellers shall be responsible for all costs, obligations and liabilities (including without limitation severance pay, accrued sick leave,
accrued vacation pay and any notices or certificates required by COBRA and HIPAA) which may result from the termination by Sellers of the employment of
any employees of Sellers as of the Closing that are not hired by Buyer; provided, however, that Buyer shall be responsible for all costs, obligations
and liabilities arising in respect of Buyer’s assumption of the Wei Contract.

7.5    Compliance with Bulk Sales Law Requirements. Buyer hereby waives compliance with any applicable bulk sales
transfer laws in connection with the

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consummation of the
transactions contemplated by this Agreement, including the bulk transfer provisions of the Uniform Commercial Code, with indemnification from Seller
against claims or liabilities arising from such noncompliance as provided in Section 11.2.

8.    CONDITIONS PRECEDENT TO BUYER’S AND GUARANTOR’S OBLIGATIONS. The obligation of the Buyer and Guarantor to
consummate the Closing shall be subject to the satisfaction at or prior to the Closing of each of the following conditions (to the extent noncompliance
is not waived in writing by the Buyer):

8.1.    Representations and Warranties True at Closing. The representations and warranties made by the Sellers in
Section 5 of this Agreement shall be true and correct in all material respects at and as of the Closing Date with the same effect as though such
representations and warranties had been made or given at and as of the Closing Date (except where such representation and warranty is made as of a
specific date and except as contemplated by this Agreement).

8.2.    Compliance with Agreement. Each Seller shall have performed and complied in all material respects with all
of its obligations under this Agreement to be performed or complied with by it on or prior to the Closing Date.

8.3.    No
Change. From the date of this Agreement through the date of the Closing there shall not have occurred any change or changes concerning the Business
or the Acquired Assets that individually or in the aggregate has had or would reasonably be expected to have a Material Adverse
Effect.

8.4.    Sellers’ Certificate. The Sellers shall have delivered to the Buyer in writing, at and as of the
Closing, one or more certificates duly executed by each Seller, in form and substance reasonably satisfactory to the Buyer and the Buyer’s
counsel, certifying that the conditions in each of Section 8.1, 8.2 and 8.3 have been satisfied and attaching copies of the certified resolutions of
the Company’s Board of Directors approving the transactions contemplated hereby. Buyer shall have also received the certificate referenced in
Section 7.3(e).

8.5.    Estimate of Equipment and Inventory. The Company and the Buyer shall have established the Estimated
Equipment and Inventory required pursuant to Section 3.2.

8.6    Approvals. All corporate and other approvals of the Sellers in connection with the transactions contemplated
by this Agreement shall have been obtained and shall be reasonably satisfactory in form and substance to the Buyer and its counsel.

8.7.    No
Litigation. No restraining order or injunction shall prevent the transactions contemplated by this Agreement and no action, suit or proceeding
shall be pending or threatened before any court or administrative body in which it will be or is sought to restrain or prohibit or obtain damages or
other relief in connection with this Agreement or the consummation of the transactions contemplated hereby.

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8.8    Board and Shareholder Approvals. The Company shall have obtained all necessary authorizations and approvals
from its Board of Directors and its shareholders required for the completion of the transaction contemplated hereunder.

8.9    Required Consents. Sellers shall have obtained and delivered to the Buyer the Required Consents in
writing.

8.10    Home and Garden License Agreement. The Company shall have executed and delivered the License and Supply
Agreement in substantially the form attached hereto as Exhibit B (the “Supply Agreement”).

9.    CONDITIONS PRECEDENT TO SELLERS’ OBLIGATIONS. The obligation of the Sellers to consummate the Closing shall be
subject to the satisfaction, at or prior to the Closing, of each of the following conditions (to the extent noncompliance is not waived in writing by
the Sellers):

9.1.    Representations and Warranties True at Closing. The representations and warranties made by the Buyer and
Guarantor in Section 6 of this Agreement shall be true and correct in all material respects at and as of the Closing Date with the same effect as
though such representations and warranties had been made or given at and as of the Closing Date (except where such representations and warranty is made
as of a specific date and except as contemplated by this Agreement).

9.2.    Compliance with Agreement. The Buyer and Guarantor each shall have performed and complied in all material
respects with all of its obligations under this Agreement that are to be performed or complied with by it at or prior to the Closing.

9.3.    No
Change. From the date of this Agreement through the date of the Closing there shall not have occurred any change or changes concerning the
respective businesses of or properties owned by the Guarantor and the Buyer that individually or in the aggregate has had or would reasonably be
expected to have a Material Adverse Effect.

9.4.    Closing Certificate. The Buyer and Guarantor each shall have delivered to the Company in writing, at and as
of the Closing, a certificate duly executed by an officer of the Buyer or Guarantor, as the case may be, in form and substance reasonably satisfactory
to the Company’s counsel, to the effect that the conditions in each of Sections 9.1, 9.2 and 9.3 have been satisfied.

9.5    Guaranty. The Guarantor shall have executed and delivered a guaranty with respect to the payments under the
Note in favor of the Company in substantially the form attached hereto as Exhibit C.

9.6.    Security Agreement. The Buyer shall have executed and delivered the Security Agreement to secure payment
under the Note, substantially the form attached hereto as Exhibit D, and all instruments contemplated thereby.

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9.7.    Estimate of Equipment and Inventory. The Company and the Buyer shall have established the Estimated
Equipment and Inventory required pursuant to Section 3.2.

9.8.    Supply Agreement. Buyer shall have executed and delivered the Supply Agreement to the
Company.

9.9    Approvals. All corporate and other approvals of the Buyer and Guarantor in connection with the transactions
contemplated by this Agreement and the Transaction Documents, including but not limited to, the Note, the Security Agreement, the Guaranty and the
License Agreement, shall have been obtained and copies of the minutes or resolutions reflecting such approvals shall have been delivered to the
Company.

9.10    Required Consents. Sellers shall have obtained the Required Consents in writing.

9.11    No
Litigation. No restraining order or injunction shall prevent the transactions contemplated by this Agreement and no action, suit or proceeding
shall be pending or threatened before any court or administrative body in which it will be or is sought to restrain or prohibit or obtain damages or
other relief in connection with this Agreement or the consummation of the transactions contemplated hereby.

9.12.    Shareholder Approval; Dissenters. The Company shall have obtained all necessary authorizations and
approvals from its shareholders required for the completion of the transactions contemplated hereunder and the number of common shares for which
asserting dissenters’ rights under Section 23B.13.210 of the Washington Business Corporation Act shall not exceed 20% of the total number of
shares of company stock outstanding on the Closing Date.

10.    CERTAIN COVENANTS.

10.1.    Confidential Information. Any and all information disclosed by the Buyer or Guarantor to any Seller or by
any Seller to the Buyer or Guarantor as a result of the negotiations leading to the execution of this Agreement that is to remain the confidential
information of such party, or in furtherance thereof, which information was not already known to the Sellers, the Buyer or Guarantor, as the case may
be, shall remain confidential to each Seller, the Buyer and the Guarantor and their respective employees, agents and investors until the Closing Date
and, if the Closing occurs, in the Sellers’ case, from and after the Closing Date. If the Closing does not take place for any reason, each Seller,
the Buyer and the Guarantor agrees to return (or certify that it has destroyed) all copies, summaries and excerpts of such information to the
disclosing party, and agrees not to further divulge or disclose any such information at any time in the future unless it has otherwise become public or
its disclosure is required by law. The information intended to be protected hereby is confidential or proprietary data of the Sellers, the Buyer and
the Guarantor which shall include, but not be limited to, financial information, customers,

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sales representatives, and
anything else having an economic or pecuniary benefit to the Buyer, the Guarantor or any Seller, respectively.

10.2    Non-Competition. For a period of two (2) years after the Closing Date, Sellers shall not directly or
indirectly invest in, own, manage, operate, finance, control, advise, render services to or guarantee the obligations of any Person that directly
competes with the Buyer in the Business; provided however, that this covenant shall not prohibit, or be interpreted as prohibiting, Sellers from
(i) selling home and garden products (A) directly to the general public; (B) to resellers or businesses that offer such products to retailers or to the
general public; or (c) to businesses that incorporate such products into existing or new products to be sold to the general public; (ii) engaging in
the development, testing, manufacture, sale and/or distribution of synthetic chemistry pesticides for and in the worldwide agricultural, horticultural
and retail markets; or (iii) purchasing or otherwise acquiring up to (but not more than) five percent (5%) of any class of the securities of any Person
(but may not otherwise participate in the activities of such Person) if such securities are listed on any national or regional securities exchange or
have been registered under Section 12(g) of the Securities Exchange Act of 1934.

10.3    Non-Solicitation. For a period of two (2) years after the Closing Date, Sellers shall not, directly or
indirectly:

(a)    solicit the business of any Person who is a customer of Buyer;

(b)    cause,
induce or attempt to cause or induce any customer, supplier, licensee, licensor, franchisee, employee, consultant or other business relation of Buyer
to cease doing business with Buyer, to deal with any competitor of Buyer or materially and adversely interfere with its relationship with Buyer;
or

(c)    hire,
retain or attempt to hire or retain any employee or independent contractor of Buyer or materially and adversely interfere with the relationship between
Buyer and any of its employees or independent contractors;

provided, however, that the provisions of this
Section 10.3 shall not apply to, limit or restrict, or in be interpreted to in any way apply to, limit or restrict the Sellers in their activities
relating to or in connection with (a) the sale of home and garden products (A) directly to the general public; (B) to resellers or businesses that
offer such products to retailers or to the general public; or (c) to businesses that incorporate such products into existing or new products to be sold
to the general public ; and/or (ii) the development, testing, manufacture, sale and/or distribution of synthetic chemistry pesticides for and in the
worldwide agricultural, horticultural and retail markets.

10.4    Covenants of Buyer and
Guarantor. Until such time as all payment obligations under the Note are fully paid and satisfied:

(a)    Buyer
and Guarantor each shall, at any reasonable time, and from time to time, on reasonable advance notice from the Company, permit the Company and
its

-34-

representatives to examine
and make copies of and abstracts from Buyer’s and Guarantor’s records and books of account, to visit the properties of Buyer and the
Guarantor, and to discuss the affairs, finances, and accounts of Buyer with any of the officers and directors of the Buyer or the Guarantor for the
purpose of examining, inspecting and auditing the Collateral (as defined in the Security Agreement) and Buyer’s and Guarantor’s performance
of their respective obligations under the Security Agreement, the Note and the Guaranty.

(b)    Guarantor shall keep adequate records and books of account in which complete entries will be made, in accordance
with U.K GAAP, reflecting all financial transactions of Guarantor and its subsidiaries.

(c)    Buyer
and Guarantor each shall pay and discharge before the same shall become delinquent all material Indebtedness, Taxes, and other material obligations for
which Buyer or Guarantor is liable, or to which its income or property is subject, and all material claims for labor, materials, or supplies that, if
unpaid, might become by law an Encumbrance upon assets of Buyer, except such Indebtedness, Taxes, claims and obligations contested in good faith by
appropriate proceedings.

(d)    Buyer
shall notify the Company in writing within five Business Days if (i) Buyer or Guarantor changes its name or identity in any manner, or (ii) Buyer or
Guarantor changes the location of its principal place of business, or the jurisdiction in which it is organized.

(e)    Buyer
and Guarantor each shall preserve and maintain its corporate existence, rights, franchises, and privileges in the jurisdiction of its organization and
will qualify and remain qualified as a foreign organization in each jurisdiction where such qualification is necessary or advisable in view of the
respective business and operations of the Buyer and the Guarantor, or the ownership of their respective properties, except where any such failure could
not reasonably be expected to result in a Material Adverse Effect.

11.    INDEMNIFICATION.

11.1    Survival of Representations and Warranties.

The representations and warranties of the Sellers in
Article 5 and the Buyer and Guarantor in Article 6 of this Agreement shall survive for a period of one year from the Closing Date or February 28, 2008,
whichever is later. The covenants and agreements of the Parties contained in this Agreement shall survive for the applicable statute of limitation
period.

11.2.    Indemnity by the Sellers. Each of the Company, individually, and the Company and the other Sellers,
jointly but not severally, agree to indemnify and hold the Buyer and Guarantor harmless from and with respect to any and all claims, liabilities,
losses, damages, costs and expenses, including without limitation the reasonable fees and disbursements of counsel (collectively,
“Losses”), related to or arising out of:

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(a)    any
inaccuracy of any representation or warranty made by the Sellers in Article 5 hereof;

(b)    any
failure by the Sellers to perform any covenant or agreement hereunder;

(c)    any
claim or liability with respect to any of the Excluded Liabilities and any other liability of Sellers other than Assumed Obligations;
and

(d)    any
claim or liability arising with respect to Sellers’ failure to comply with the bulk sales laws of any jurisdiction in connection with transactions
contemplated by this Agreement.

11.3.    Indemnity by the Buyer and Guarantor. The Buyer and Guarantor, jointly and severally, agree to indemnify
and hold the Sellers harmless from and with respect to any and all Losses, related to or arising out of

(a)    any
inaccuracy of any representation or warranty made by the Buyer and/or Guarantor in Article 6 hereof;

(b)    any
failure by the Buyer or Guarantor to perform any covenant or agreement hereunder;

(c)    the
conduct of the Business and the ownership and operation of the Acquired Assets after the Closing Date; and

(d)    any
claim or liability with respect to any of the Assumed Obligations.

11.4.    Claims.

(a)    Notice. Any party seeking indemnification hereunder (the “Indemnified Party”) shall
promptly notify the other party or parties hereto from whom such Indemnified Party is entitled to indemnification hereunder (the “Indemnifying
Party”, which term shall include all Indemnifying Parties if there be more than one) of any action, suit, proceeding, demand or breach (a
“Claim”) with respect to which the Indemnified Party claims indemnification hereunder, provided that failure of the Indemnified
Party to give such notice shall not relieve the Indemnifying Party of its obligations under this Section 11 except to the extent, if at all, that such
Indemnifying Party shall have been prejudiced thereby.

(b)    Third Party Claims. If such Claim relates to any, suit or proceeding instituted in any tribunal or
governmental authority against the Indemnified Party by a third party (a “Third Party Claim”), the Indemnifying Party shall be
entitled to participate in the defense of such Third Party Claim after receipt of notice of such claim from the Indemnified Party. Within thirty (30)
days after receipt of notice of a particular matter

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from the Indemnified Party,
the Indemnifying Party may assume the defense of such Third Party Claim, in which case the Indemnifying Party shall have the authority to negotiate
compromise and settle such Third Party Claim, if and only if the following conditions are satisfied:

(i)    the Indemnifying Party shall have confirmed in writing that it is obligated hereunder to indemnify the Indemnified
Party with respect to such Third Party Claim;

(ii)    the Indemnified Party shall not have given the Indemnifying Party written notice that it has determined, in the
exercise of its reasonable discretion, that matters of corporate or management policy or a conflict of interest make separate representation by the
Indemnified Party’s own counsel advisable; and

(iii)    such Third Party Claim involves only money damages and does not seek an injunction or other equitable
relief.

The Indemnified Party shall retain the right to employ its
own counsel and to participate in the defense of any Third Party Claim, the defense of which has been assumed by the Indemnifying Party pursuant
hereto, but the Indemnified Party shall bear and shall be solely responsible for its own costs and expenses in connection with such
participation.

11.5.    Method and Manner of Paying Claims. In the event of any claims under this Section 11, the claimant shall
advise the party or parties who are required to provide indemnification therefor in writing of the amount and circumstances surrounding such claim.
With respect to liquidated claims, if within thirty days the other party has not contested such claim in writing, the other party will pay the full
amount thereof within ten days after the expiration of such period (subject to the set-off requirement in Section 11.7). Any amount owed by an
Indemnifying Party hereunder with respect to any Claim may be set-off by the Indemnified Party against any amounts owed by the Indemnified Party to any
Indemnifying Party and shall be set off in accordance with Section 11.7 with respect to any amounts owed by the Seller.

11.6    Limitations on Indemnification.

(a)    The
Sellers on the one hand and the Buyer and Guarantor on the other hand shall not be required to indemnify an Indemnified Party hereunder except to the
extent that the aggregate amount of Losses for which the Indemnified Party is otherwise entitled to indemnification pursuant to this Section 11 exceeds
$50,000, whereupon the Indemnified Party shall be entitled to be paid the aggregate amount of all such Losses, (including all such Losses up to
$50,000) subject to the limitations on maximum amount of recovery set forth in Section 11.6(b).

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(b)    The
aggregate Losses payable by an Indemnifying Party pursuant to this Section 11 with respect to all claims for indemnification shall not exceed One
Million Dollars ($1,000,000).

11.7    Set-Off. Notwithstanding any provision to the contrary in this Section 11 or otherwise, any indemnification
required to be paid by the Company and/or Sellers pursuant to this Section 11, shall be satisfied first by offset from amounts payable under the
Note.

11.8    Sole
and Exclusive Remedy. Except with respect to claims based on fraud in the inducement, the indemnification remedy set forth in this Section 11 shall
provide the sole and exclusive remedy of the Sellers, the Buyer and Guarantor for breach or non-performance of any provision of, or any untrue
representation or warranty in, this Agreement. The Parties acknowledge that separate remedies for breach or nonperformance of any provision of, or any
untrue representation or warranty in, the Note, the Security Agreement, the Guaranty and the Supply Agreement shall be governed by the respective terms
of such agreements.

12.    TERMINATION; ALTERNATIVE TRANSACTION.

(a)    This
Agreement (other than the provisions of Section 10.1 and Sections 12 and 14 hereof) may be terminated at any time prior to the
Closing:

(i)    by mutual written consent of all Parties to this Agreement;

(ii)    by either the Buyer and Guarantor on the one hand or the Company on the other hand, in writing, without liability
to the terminating Party or Parties on account of such termination if, the Closing shall not have occurred on or before February 28, 2007 (the
“Closing Deadline”); provided, however, that the right to terminate this Agreement under this Section 12(a)(ii) shall not be available
to any party whose failure to comply with any material provision of this Agreement has been the cause of the failure to close. Notwithstanding the
foregoing, the Closing Deadline automatically shall be extended for a period of up to 30 days if, in the good faith judgment of the Company’s
board of directors, adjournment or postponement of a duly called special meeting of shareholders of the Company is necessary for the purpose of
soliciting additional proxies to vote in favor of the Agreement;

(iii)    by
the Company, pursuant to the provisions of Section 7.1.11(c);

(iv)    by
either Buyer or the Company, if the approval of the shareholders of the Company required by Section 8.9 shall not have been obtained at a meeting duly
convened therefor or any adjournment thereof (unless, in the case of any such termination pursuant to this Section 12(a)(iv), the failure to obtain
such shareholder approval shall have been caused by the action or failure to act of the party (or its

-38-

subsidiaries) seeking to
terminate this Agreement, which action or failure to act constitutes a breach of this Agreement);

(v)    by
either Buyer or the Company, if any permanent injunction or action by any governmental entity of competent jurisdiction preventing the consummation of
transactions contemplated by this Agreement shall have become final and nonappealable; provided, however, that the party seeking to terminate this
Agreement pursuant to this Section 12(a)(v) shall have used all commercially reasonable efforts to remove such injunction or overturn such
action;

(vi)    by
Buyer, if (A) there has been a breach of any representations or warranties (as of the time such representations or warranties were made) of the Company
set forth herein the effect of which, individually or together with all other such breaches, constitutes a Material Adverse Effect, (B) there has been
a breach in any material respect of any of the covenants or agreements set forth in this Agreement on the part of the Company, which breach is not
curable or, if curable, is not cured within 30 days after written notice of such breach is given by Buyer to the Company, or (C) the Board of Directors
of the Company (x) withdraws or amends or modifies in a manner materially adverse to Buyer its recommendation or approval in respect of this Agreement,
(y) makes a recommendation with respect to any transaction arising out of a Favorable Third Party Proposal (including making no recommendation or
stating an inability to make a recommendation), other than a recommendation to reject such transaction, or (z) takes any action that is prohibited by
Section 7.1.11(a);

(vii)    by
the Company, if (A) there has been a breach of any representations or warranties (as of the time such representations or warranties were made) of the
Buyer or the Guarantor set forth herein the effect of which, individually or together with all other such breaches, constitutes a Material Adverse
Effect, (B) there has been a breach in any material respect of any of the covenants or agreements set forth in this Agreement on the part of Buyer or
Guarantor, which breach is not curable or, if curable, is not cured within 30 days after written notice of such breach is given by the Company to Buyer
or Guarantor;

(b)    In the
event of termination of this Agreement pursuant to this Section 12, the transactions contemplated by this Agreement shall be deemed abandoned and this
Agreement shall forthwith become void, without liability on the part of any party hereto, except as provided in Section 12(c).

(c)    If
this Agreement shall have been terminated pursuant to Sections 12(a)(iii) or (vi)(C), then, in any of such cases, the Company shall pay to Buyer a
termination fee equal to $100,000 as liquidated damages and not as a penalty. Any amounts payable under this Section 12(c) shall be paid in same day
funds no later than two Business Days after a termination described in this Section.

13.    DEFINITIONS. As used in this Agreement, the following terms not otherwise defined have the following respective
meanings:

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“Affiliate”: As
applied to any Person, any Person controlling, controlled by or under common control with such Person.

“Distributor
Agreement”: The Independent Distributor Agreement between the Company and the Buyer dated as of the date hereof, including any amendments
thereto.

“Employee Benefit
Plans”: Any pension, profit-sharing, deferred compensation, bonus, stock option, share appreciation right, severance, group or individual
health, dental, medical, life insurance, survivor benefit, or similar plan, policy or arrangement, whether formal or informal, written or oral, for the
benefit of any director, officer, consultant or employee, whether active or terminated, of the Company.

“Indebtedness”:
As applied to any Person, all indebtedness of such Person for borrowed money, whether current or funded, or secured or unsecured, including without
limitation (a) all indebtedness of such Person for the deferred purchase price of property or services represented by a note or other security, (b) all
indebtedness of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of a lender under such agreement in the event of default are limited to repossession or sale of such
property), (c) all indebtedness of such Person secured by a purchase money mortgage or other lien to secure all or part of the purchase price of
property subject to such mortgage or lien, (d) all obligations under leases which shall have been or must be, in accordance with generally accepted
accounting principles, recorded as capital leases in respect of which such Person is liable as lessee, (e) any liability of such Person in respect of
banker’s acceptances or letters of credit, and (f) all indebtedness referred to above which is directly or indirectly guaranteed by such Person or
which such Person has agreed (contingently or otherwise) to purchase or otherwise acquire or in respect of which it has otherwise assured a creditor
against loss.

“Intellectual
Property”: Any or all of the following: (i) works of authorship including, without limitation, computer programs, algorithms, routines, source
code and executable code, whether embodied in software or otherwise, documentation, designs, files, records and data; (ii) inventions (whether or not
patentable), improvements, and technology; (iii) proprietary and confidential information, including technical data and customer and supplier lists,
trade secrets, show how, know how and techniques; (iv) databases, data compilations and collections and technical data; (v) processes, devices,
prototypes, schematics, net lists, mask works, test methodologies and hardware development tools; (vi) logos, trade names, trade dress, trademarks,
service marks, World Wide Web addresses, uniform resource locators and domain names, tools, methods and processes; and (vii) all embodiments of the
foregoing in any form and embodied in any media.

“Intellectual Property
Rights”: Any or all of the following and all rights in, arising out of, or associated therewith: (i) all United States and foreign patents and
utility models and applications therefor and all reissues, divisions, re-examinations, renewals, extensions, provisionals, continuations and
continuations-in-part thereof, and equivalent or similar rights anywhere in the world in inventions and discoveries including, without limitation,
invention

-40-

disclosures; (ii) all trade
secrets and other rights in know-how and confidential or proprietary information; (iii) all copyrights, copyright registrations and applications
therefor and all other rights corresponding thereto throughout the world; (iv) all industrial designs and any registrations and applications therefor
throughout the world; (v) mask works, mask work registrations and applications therefor, and all other rights corresponding thereto throughout the
world; (vi) all rights in World Wide Web addresses, uniform resource locators and domain names and applications and registrations therefor; (vii) all
rights in all trade names, logos, common law trademarks and service marks, trademark and service mark registrations and applications therefor and all
goodwill associated therewith throughout the world; and (viii) any similar, corresponding or equivalent rights to any of the foregoing anywhere in the
world.

“Intellectual Property
Rights”: Patents, trademarks, trade names, domain names, copyrights, trade secrets, technology, know-how, processes and all other intellectual
property rights whether registered or unregistered.

“IRS”: The
United States Internal Revenue Service.

“Material Adverse
Effect.” As to the Sellers, a material adverse effect on the condition (financial or otherwise), operations or business of the Company or assets
of the Business or the ability of the Sellers to perform their obligations under the Transaction Documents. As to the Buyer or Guarantor, a material
adverse effect on the condition (financial or otherwise), operations or business of the Buyer or assets of the Buyer or Guarantor, as the case may be,
or the ability of Buyer or Guarantor to perform its obligations under the Transaction Documents.

“Ordinary course of
business” or “ordinary course” or any similar phrase shall mean the usual, regular and ordinary course of such Party’s
normal operations in substantially the same mater as heretofore conducted.

“Person”: A
corporation, an association, a partnership, a limited liability company, an organization, a business, an individual, a government or political
subdivision thereof or a governmental agency.

“Tax” or
“Taxes”: Any federal, state, local, foreign and other income, profits, franchise, capital, withholding, unemployment insurance, social
security, occupational, production, severance, gross receipts, value added, sales, use, excise, real and personal property, ad valorem, occupancy,
transfer, employment, disability, workers’ compensation or other similar tax, duty, fee, assessment or other governmental charge (including all
interest and penalties thereon and additions thereto).

14.    GENERAL.

14.1.    Expenses. Buyer shall bear and pay any and all sales, use, business and occupation, real estate excise and
similar transfer taxes, including, without limitation, those provided for in Revised Code of Washington Chapters 82.04, 82.08 82.12 and
82.45,

-41-

arising out of the transfer
of the Acquired Assets to Buyer pursuant hereto (the “Buyer Transfer Taxes”). Buyer and Seller shall use commercially reasonable
efforts to cooperate with each other with respect to delivery of certificates and other documents reasonably necessary to perfect any exemptions from
such taxes as may be available in the reasonable opinion of Buyer. To the extent any Tax authority provides notice of an audit of the Buyer Transfer
Taxes, Buyer shall promptly assume responsibility for such audit and shall bear and pay any assessment of additional Buyer Transfer Taxes, plus
interest and penalties determined to be due thereon. All expenses of the preparation, execution and consummation of this Agreement and of the
transactions contemplated hereby, including without limitation attorneys’, accountants’ and outside advisers’ fees and disbursements,
shall be borne by the party incurring such expenses.

14.2.    Notices. All notices, demands and other communications hereunder shall be in writing or by written
telecommunication, and shall be deemed to have been duly given if delivered personally; when transmitted, if transmitted by telecopy, electronic or
digital transmission method; the day after it is sent, if sent for next day delivery by recognized overnight delivery service; and upon receipt, by
certified or registered mail, return receipt requested. In each case such notice shall be sent to:

If to the Sellers or either of
them, to:

	
	 	Eden Bioscience Corporation
 11816 North Creek Pkway. N.

Bothell, WA 98011
 Attention: Rhett R. Atkins and Bradley S Powell
 Fax: (425) 806-7400
 Email: atkinsr@edenbio.com;
powellb@edenbio.com

with a copy sent
contemporaneously to:

	
	 	Perkins Coie LLP
 1201 Third Avenue, Suite 4800
 Seattle,
Washington 98101
 Attention: Andrew B. Moore
 Fax: (206)359-9649
 Email: amoore@perkinscoie.com

If to the Buyer,
to:

	
	 	Plant Health Care, Inc.
 440 William Pitt Way
 Pittsburgh,
PA 15238
 Attention: John A. Brady
 Fax: 412-826-5445
 Email: jabrady@planthealthcare.com

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If to the Guarantor,
to:

	
	 	Plant Health Care plc
 440 William Pitt Way
 Pittsburgh,
PA 15238
 Attention: John A. Brady
 Fax: 412-826-5445
 Email: jabrady@planthealthcare.com

with a copy sent
contemporaneously to:

	
	 	Buchanan Ingersoll & Rooney PC
 One Oxford Centre, 20th
Floor
 301 Grant Street
 Pittsburgh, PA 15219
 Attention: Jeremiah G. Garvey
 Fax: 412-562-1041
 Email:
jeremiah.garvey@bipc.com

or such other place and with such other copies as any party
may designate as to itself by written notice to the others.

14.3.    Entire Agreement. This Agreement together with the Transaction Documents and the Schedules contains the entire
understanding of the parties, supersede all prior agreements and understandings relating to the subject matter hereof and shall not be amended except
by a written instrument hereafter signed by all of the parties hereto.

14.4.    Governing Law. The validity and construction of this Agreement shall be governed by the internal laws (and not
the choice-of-law rules) of the State of Delaware. Each party hereto irrevocably and unconditionally (a) agrees that any suit, action or other legal
proceeding arising out of this Agreement may be brought and adjudicated in the federal or the state courts of Delaware situated in New Castle County,
(b) submits to the jurisdiction of any such court for the purposes of any such suit and (c) waives and agrees not to assert by way of motion, as a
defense or otherwise in any such suit, any claim that it, he or she is not subject to the jurisdiction of the above courts, that such suit is brought
in an inconvenient forum or that the venue of such suit is improper.

14.5.    Sections and Section Headings. The headings of sections and subsections are for reference only and shall not
limit or control the meaning thereof.

14.6.    Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective
heirs, successors and permitted assigns. Neither this Agreement nor the obligations of any party hereunder shall be assignable or transferable by any
party without the prior written consent of the other parties hereto.

-43-

14.7.    Severability. In the event that any covenant, condition, or other provision herein contained is held to be
invalid, void, or illegal by any court of competent jurisdiction, the same shall be deemed to be severable from the remainder of this Agreement and
shall in no way affect, impair, or invalidate any other covenant, condition, or other provision contained herein.

14.8.    Further Assurances. The parties agree to take such reasonable steps and execute such other and further documents
as may be necessary or appropriate to cause the terms and conditions contained herein to be carried into effect.

14.9.    Tax
Treatment. The Buyer, the Guarantor and the Sellers shall treat and report the transactions contemplated by this Agreement in all respects consistently
for purposes of any foreign, federal, state or local tax, including without limitation with respect to calculation of gain, loss and basis with
reference to the Allocation determined in accordance with Section 3.4 hereof.

14.10.    No
Implied Rights or Remedies. Nothing herein expressed or implied is intended or shall be construed to confer upon or to give any person, firm or
corporation, other than the Sellers, the Guarantor and the Buyer and their successors and permitted assigns, any rights, remedies or claims under or by
reason of this Agreement and this Agreement shall not be interpreted or enforced as a third party beneficiary contract.

14.11.    Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument.

14.12.    Public Statements or Releases. Each of the parties hereto agrees that prior to the consummation of the Closing
no party to this Agreement will make, issue or release any public announcement, statement or acknowledgment of the existence of, or reveal the status
of, this Agreement or the transactions provided for herein, without first obtaining the consent of the other parties hereto (which consent shall not be
unreasonably withheld). Nothing contained in this Section 14.12 shall prevent any party from making such disclosures as such party may consider
reasonably necessary to satisfy such party’s legal or contractual obligations, or to comply with the requirements of applicable laws and
regulations (in which case the party so obligated to make such disclosure shall advise the other parties in advance).

14.13.    Business Records. The Sellers acknowledge that business records of the Sellers relating to the operations of the
Business prior to the Closing will not be conveyed to the Buyer as part of the Acquired Assets, and that the Buyer may from time to time require access
to or copies of such records in connection with claims arising with respect to operations of the Business prior to the Closing, and the Seller agrees
that upon reasonable prior notice from the Buyer, it will, during normal business hours, provide the Buyer with either access to or, at the
Company’s option, copies of such records for such purposes. The Buyer agrees to hold any confidential information so provided in confidence and to
use such information only for the purposes described above. The Seller agrees that it will not

-44-

within three (3) years after
the Closing Date destroy any business records prepared prior to the Closing without first notifying the Buyer and affording it the opportunity to
remove or copy them. For purposes of the preceding sentence, any notice from the Seller delivered in accordance with Section 14.2 shall be deemed to be
adequate notice if not responded to in writing by the Buyer within five (5) Business Days.

14.14.    Knowledge. Whenever the phrase “to the knowledge of the Sellers” or another similar
qualification is used herein, the relevant knowledge shall refer to the actual knowledge of the Company’s Chief Executive Officer, Chief Financial
Officer and Chief Scientific Officer, after reasonable investigation. Whenever the phrase “to the knowledge of the Buyer and
Guarantor” or another similar qualification is used herein, the relevant knowledge shall refer to the actual knowledge of the Chief Executive
Officer and the Chief Financial Officer of each of the Buyer and the Guarantor, after reasonable investigation.

[Remainder of Page Intentionally Left
Blank]

IN WITNESS WHEREOF, and intending
to be legally bound hereby, the parties hereto have caused this Asset Purchase Agreement to be duly executed and delivered as a sealed instrument as of
the date and year first above written.

	 
	   	   	   	PLANT
HEALTH CARE, INC.

	 
	 
	   	   	   	By: /s/ John A. Brady
John A. Brady
 Chief Executive Officer

	 
	   	   	   	 

	 
	   	   	   	PLANT
HEALTH CARE plc

	 
	 
	   	   	   	By: /s/ John A. Brady
Name: John A. Brady

	 
	   	   	   	Title: CEO

	 
	   	   	   	 

	 
	   	   	   	 

	 
	   	   	   	EDEN
BIOSCIENCE CORPORATION

	 
	 
	   	   	   	By: /s /Bradley S. Powell

	 
	   	   	   	Name: Bradley S. Powell

	 
	   	   	   	Title: CFO

	 
	   	   	   	 

	 
	   	   	   	EDEN
BIOSCIENCE MEXICO,
 S. de R.L. de C.V.

	 
	 
	   	   	   	By: /s/ Bradley S. Powell

	 
	   	   	   	Name: Bradley S. Powell

	 
	   	   	   	Title: Director

	 
	   	   	   	 

	 
	   	   	   	EDEN
BIOSCIENCE EUROPE SARL

	 
	 
	   	   	   	By: /s/ Bradley S. Powell

	 
	   	   	   	Name: Bradley S. Powell

	 
	   	   	   	Title: Gerant

 

Exhibit A

Secured Promissory Note

FORM OF SECURED PROMISSORY NOTE

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, NOR UNDER ANY STATE SECURITIES LAW AND MAY NOT BE PLEDGED, SOLD, ASSIGNED OR TRANSFERRED UNLESS (i) A REGISTRATION STATEMENT
WITH RESPECT HERETO IS EFFECTIVE UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES LAW REQUIREMENTS HAVE BEEN MET OR
(ii) EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE REGISTRATION OR QUALIFICATION REQUIREMENTS OF
APPLICABLE STATE SECURITIES LAW ARE AVAILABLE.

SECURED PROMISSORY NOTE

	
$1,000,000.00
	 	__________ ____, 200__

1.    FOR VALUE RECEIVED and
intending to be legally bound hereby, the undersigned, Plant Health Care, Inc., a Pennsylvania corporation (the “Maker”), having its
principal office at 440 William Pitt Way, Pittsburgh, PA 15238, hereby promises to pay to the order of Eden Bioscience Corporation, a Washington
corporation, or its successors or assigns (“Payee”), in immediately available funds at its principal office located at 11816 North Creek
Parkway N., Bothell, WA 98011, or at such other location as the Payee may from time to time designate, the principal sum of One Million Dollars
($1,000,000.00) plus simple interest at the rate of 5% per annum based on a 365-day year, on the dates and in the manner set forth herein. Capitalized
terms used but not defined herein shall have the meanings ascribed to them in the Asset Purchase Agreement between Maker and Payee dated as of the date
hereof (the “Purchase Agreement”).

2.    The balance of principal and
interest shall be due and payable on the last Business Day of December 2007 (the “Maturity Date”). The amount due at the Maturity Date may be
prepaid (without reduction of interest payable through the Maturity Date), and shall be prepaid in accordance with Section 7 hereof.

3.    In accord with Section 9.4 of the
Purchase Agreement, Plant Health Care plc, the ultimate parent company of Maker, shall fully and unconditionally guaranty the obligations of Maker
under this Note.

4.    Pursuant to Section 11.7 of the
Purchase Agreement, Maker shall have the right to setoff the amount of any claim Maker has against the Payee or any Affiliate of Payee pursuant to the
Purchase Agreement against any amount Maker owes Payee under this Note (inclusive of principal and interest accruing thereon), all on the terms and
conditions set forth in Section 11 of the Purchase Agreement.

5.    The occurrence of any one or more
of the following events shall constitute an Event of Default under this Note: (i) the failure to pay principal of or interest on this Note as and when
due; (ii) a proceeding being filed or commenced against the Maker for dissolution or liquidation, or the Maker voluntarily or involuntarily terminating
or dissolving or being terminated or dissolved; (iii) the insolvency of, the appointment of a custodian, trustee, liquidator or receiver for any of the
property of, an assignment for the benefit of creditors by, or the filing of a petition under bankruptcy, insolvency or debtor’s relief law, or
for any readjustment of indebtedness, composition or extension by or against, the Maker, and any such proceeding shall remain undismissed or unstayed
and in effect for a period of 30 consecutive days or more; or (iv) the breach in any material respect of any of the representations, warranties,
covenants or agreements set forth in the Purchase Agreement or this Note on the part of the Maker, which breach is not curable or, if curable, is not
cured within thirty (30) days after written notice of such breach is given by the Payee to the Maker.

6.    The Maker agrees that if an Event
of Default occurs under this Note, then the unpaid principal balance of and interest on this Note shall immediately become due and payable, without
notice or demand. From and after occurrence and during the continuance of an Event of Default, the principal balance of this Note shall bear interest
at the rate of twelve percent (12%) per annum, compounded monthly. If an Event of Default occurs, the Maker agrees to pay to the Payee all expenses
incurred by the Payee, including reasonable attorneys’ fees, in enforcing and collecting this Note.

7.    The obligations of the Maker
under this Note are secured by Maker’s right, title and interest in certain of the Acquired Assets under the Purchase Agreement, as set forth in
the Security Agreement between Maker and Holder of even date herewith. The Security Agreement provides for a security interest in the Equipment, among
other items of collateral. Payee consents to the sale of any such Equipment in a bona fide third party sale to a party or parties unaffiliated with
Maker, provided that in connection with any such sale of Equipment, Maker shall pay to Holder within five (5) Business Days after the closing of the
sale of any such Equipment, an amount of cash equal to 75% of the value of the consideration received or to be received by Maker in connection with
such sale. Any amounts received by Maker from the buyer of such Equipment shall be held by Maker in trust for the benefit of Payee until such amount is
paid in full.

8.    Failure of the Payee hereof to
assert any right contained herein will not be deemed to be a waiver thereof.

9.    This Note is negotiable and may
be assigned or otherwise transferred by Payee in accordance with applicable securities laws. Upon any such transfer, Payee shall notify Maker forthwith
of such transfer. Until Maker receives written notification of such transfer, Maker shall be entitled to pay Payee and shall be entitled to credit for
any such payments to Payee. This Note may not under any circumstances be assigned or otherwise transferred by Maker without the prior written consent
of Payee.

10.    In the event any one or more of
the provisions of this Note shall for any reason be held to be invalid, illegal or unenforceable, in whole or in part or in any respect, or in the
event that any one or more of the provisions of this Note operate to invalidate this Note, then and in either of those events, such provision or
provisions only shall be deemed null and void and shall not affect any other provision of this Note, and the remaining provisions of this Note shall
remain operative and in full force and effect and shall in no way be affected, prejudiced or disturbed thereby.

11.    The Maker hereby forever waives
presentment, presentment for payment, demand, protest, notice of protest, notice of dishonor of this Note and all other demands and notices in
connection with the delivery, acceptance, performance and enforcement of this Note. The Maker further agrees to indemnify and hold harmless the Payee
from and against any and all damages, liabilities, losses, costs and expenses (including, without limitation, reasonable attorneys’ fees and
expenses) which the Payee may incur by reason of the Maker’s failure promptly to pay when due the indebtedness evidenced by this
Note.

12.    The Note shall be governed by
and construed in accordance with the laws of the State of Delaware, without giving any effect to principles of conflicts of law, and shall be binding
upon the successors and permitted assigns of the Maker and shall inure to the benefit of the successors and permitted assigns of the
Payee.

13.    Statutory Notice. ORAL
AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW (IF
AND TO THE EXTENT APPLICABLE).

-2-

[Signature Page Follows]

-3-

IN WITNESS WHEREOF, the undersigned has
caused this Promissory Note to be duly executed and delivered on the day and year first above written.

	 
	   	   	   	PLANT HEALTH CARE, INC., a
 Pennsylvania corporation

	 
	   	   	   	   	   	   
	 
	   	   	   	By: 
Name: John A. Brady
 Title: Chief Executive Officer

 

Exhibit B

Supply Agreement

FORM OF
LICENSE AND SUPPLY AGREEMENT

This Agreement (the
“Agreement”) is entered into by and between Plant Health Care, Inc., a Pennsylvania corporation having offices at 440 William Pitt
Way, Pittsburgh PA, 15238 (“PHC”), and Eden Bioscience Corporation, a Washington corporation having offices at 11816 North Creek
Parkway N., Bothell, WA 98011 (“Eden”) as of   , 200  (the “Effective Date”).

BACKGROUND

WHEREAS, PHC owns and markets certain
compositions and products, including, but not limited to, plant-based fertilizers;

WHEREAS, Eden is a plant technology
company that develops, manufactures and markets harpin protein-based products for plants and seeds;

WHEREAS, PHC and Eden entered into that
certain Asset Purchase Agreement dated as of   , 2006 (“Asset Purchase Agreement”) whereby PHC will acquire certain assets
of Eden at the closing thereunder;

WHEREAS, it is a condition to the
closing under the Asset Purchase Agreement that the parties enter into an agreement to provide certain rights and licenses to Eden on the terms
provided for herein; and

WHEREAS, in connection with and in
furtherance of the Asset Purchase Agreement, PHC desires to grant certain rights and licenses to Eden on the terms provided for
herein.

NOW, THEREFORE, pursuant to the mutual
covenants set forth herein and for other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties
agree as follows.

AGREEMENT

1.    Defined Terms. For
purposes of this Agreement, capitalized terms will have the meanings set forth in Section 12 or elsewhere herein where the term is
defined.

2.    Trademark
License.

2.1    Trademarks. For the Term and in the Territory, PHC hereby grants to Eden (a) a royalty-free, exclusive,
non-transferable (except as provided at Section 11.4) license to use the “Messenger”, “MightyPlant” and
“Harp-N-Tek” trademarks and logos set forth on Exhibit A hereto (the “Trademark(s)”) in connection with the
advertising, promotion, distribution, maintenance and sale of the Products in the Home and Garden Market.

2.2    Reserved Rights. Eden expressly agrees that (a) neither title nor ownership of the Trademarks is acquired
under this Agreement; and (b) Eden will not use the Trademarks as part of Eden’s corporate trade name, trademark or logotype, or permit any third
party under Eden’s control to do so. Eden’s use of any Trademark will inure to the benefit of PHC.

2.3    Approvals. Eden will provide to PHC for purposes of review and approval (such approval not to be
unreasonably withheld or delayed) all marketing materials relating to Products that

1

incorporate the Trademarks at
least twenty (20) days prior to the earlier of commercial production or release of such materials. Failure by PHC to give Eden written notice within
twenty (20) days after PHC’s receipt of such marketing materials will constitute PHC’s approval thereof. The copyright in any such marketing
materials (including, without limitation, any translation, adaptation and/or modification) will be owned by Eden, subject to PHC’s Trademark
rights.

3.    Exclusive Supply
Agreement.

3.1    Supply Agreement. PHC hereby grants to Eden an exclusive, worldwide right and license for the Term to sell
the Compositions as a part of the Products in the H&G Market.

3.2    Exclusivity. Eden’s rights under this Section 3 will be exclusive in the Territory during the Term. PHC
represents and warrants to Eden that PHC has not entered into any other distribution, supply or sales representative agreements, written or oral, with
any third party permitting the sale of the Compositions (or any products incorporating the Compositions) in the H&G Market in the Territory as of
the Effective Date. PHC covenants and agrees that during the Term, PHC will not enter into any such agreement or itself sell or distribute the
Compositions (or any products incorporating the Compositions) in the H&G Market in the Territory or permit any third party to do so.
Notwithstanding the terms of this Section 3.2, PHC will not be precluded from selling the Compositions to professional landscapers, farmers or plant
nurseries or to businesses that sell to professional landscapers, farmers or plant nurseries.

3.3    Distribution; Subdistributors. Eden may sell the Products in the H&G Market directly or through
distributors, resellers or retailers. In addition, prior to the issuance of the Me Too Registrations described at Section 4.2 and subject to applicable
laws, Eden may grant supplemental distribution rights under PHC’s Regulatory Approvals to subdistributors to package and label the Products for
distribution and sale in the H&G Market in the Territory, provided that (a) any such subdistributor appointment will be pursuant to a written
contract between Eden and the applicable subdistributor; (b) the terms and conditions of such contract will comply and be consistent with the terms and
conditions of this Agreement; and (c) Eden will use commercially reasonable efforts to ensure that such subdistributors comply with the applicable
provisions of this Agreement. Notwithstanding any appointment of subdistributors pursuant to this Section 3.3, Eden will remain fully responsible for
the performance of all of its covenants and obligations hereunder, and for such subdistributor’s compliance with all Eden’s covenants and
obligations hereunder.

3.4    Promotion of the Products. Eden will not, and will ensure that none of its subdistributors (a) promote,
market, sell or distribute any Products for use in any jurisdiction within the Territory where any applicable Regulatory Approval has not been
obtained; or (b) make any representations or warranties concerning the Products on behalf of PHC. Eden will conduct its business in a responsible and
professional manner so as to enhance the reputation of the Products in the H&G Market in the Territory.

3.5    Sales Leads. PHC will forward to Eden all leads for sales of the Products in the H&G Market in the
Territory. Eden agrees to make commercially reasonable efforts to respond to all leads.

3.6    Purchase Order Process. PHC will supply the Compositions in quantities requested by Eden pursuant to
Purchase Orders submitted by Eden from time to time in the form reasonably requested by PHC. No Purchase Order will be for less than Five Thousand
Dollars ($5,000) unless otherwise agreed to by PHC. Eden agrees to provide to PHC, on a quarterly basis, a rolling, non-binding annual estimate of
upcoming orders. All Purchase Orders will be subject to the terms and conditions of this Agreement, and will be expressly limited to the terms of this
Agreement. Except as to quantity and shipping requirements set forth on each applicable Purchase Order, additional or contrary terms proposed by either
party, whether in the form of the Purchase Order, invoice, acknowledgement, confirmation or

2

otherwise, will be
inapplicable, and the terms of this Agreement will control in the event of any conflict between such terms and the terms of this Agreement. PHC will
give Eden written notice accepting or rejecting each Purchase Order submitted by Eden in accordance with this Agreement within ten (10) days after
PHC’s receipt of the Purchase Order. If PHC rejects any Purchase Order submitted by Eden, PHC’s notice of rejection will specify the reasons
for rejection. PHC must accept a Purchase Order submitted by Eden to the extent the Purchase Order complies with this Agreement.

3.7    Delivery Terms. All deliveries by PHC will be to an address in the United States identified by Eden in the
Purchase Order. Upon delivery, title will pass to Eden and PHC will have no further responsibility or risk of loss, except as may otherwise be provided
in Sections 7 and 8.

3.8    Inspection of Product. Eden or its representative will inspect all Compositions promptly upon receipt, and
in the event of any shortage, damage or discrepancy or in the event any of the Compositions fail to comply with the then Specifications (except for
defects not readily observable by Eden without opening the packaging thereof), Eden will report the same to PHC within fifteen (15) days after receipt,
in which event Eden will furnish written evidence or other documentation, as appropriate. If the substantiating evidence delivered by Eden reasonably
demonstrates that such shortage, damage, discrepancy or nonconformity with Specifications existed at the time of delivery, Eden may return the
Compositions to PHC at PHC’s expense and, at Eden’s request and option, PHC will either promptly replace the Compositions in accordance with
the delivery procedures set forth herein or refund or credit Eden’s account for the full invoice value, together with any commercially reasonable
shipping, inspection and return costs incurred by Eden. Any Compositions not rejected by Eden by written notice to PHC within fifteen (15) days after
delivery (other than Compositions containing latent defects not readily observable by Eden) will be deemed to have been accepted by Eden. Following
acceptance, the sole remedies of Eden with respect to nonconformities, damage or defects in the Compositions will be those set forth in Section
7.

3.9    Price. PHC will supply the Compositions to Eden at a price equal to eighty percent (80%) of PHC’s
actual United States agricultural distributor price for such Compositions, net of all final rebates or other allowances given (“Actual
Price”). If necessary, PHC will extend price reductions to Eden after delivery to reflect the difference in the Actual Price and the price
originally invoiced, by providing to Eden the equivalent in value of free goods or credits against the next Purchase Order placed by Eden. Upon
request, PHC will provide Eden with a written certification confirming the Actual Price for any order period. Each party will be responsible for their
own taxes, fees, charges or assessments of any nature levied by any governmental authority in connection with the transactions under by this
Agreement.

3.10    Payment. PHC will invoice Eden upon delivery and payment will be due to PHC within thirty (30) days of the
invoice date. Payment will be made to an address provided by PHC or by wire transfer to an account designated by PHC. Any wire transfer or other EFT
fees are for PHC’s account. In the event of a dispute with regard to amounts owing, Eden will timely pay any undisputed amounts and the parties
agree to cooperate in good faith to promptly resolve any disputed amounts. PHC will have the right to charge Eden a delinquent payment service charge
on the amount of any fees not paid when due at a rate equal to the lesser of one and one-half percent (1-1/2%) per month (or portion thereof) or the
highest rate permitted by law, whichever is lower. In the event of any delinquent payment by Eden, such delinquency will not constitute a breach of
this Agreement, but late fees will accrue and PHC, at its option, may withhold delivery of any outstanding Purchase Orders and otherwise suspend
PHC’s performance under this Agreement without liability until payment is received.

3

4.    Registrations and Regulatory
Approvals.

4.1    EPA
Filings. Subject to Sections 4.2 and 4.3 herein, PHC will, at its expense, maintain all Regulatory Approvals and applications for approval with the
EPA for the Compositions in jurisdictions within the Territory where they exist as of the Effective Date as set forth at Exhibit B. Pending
issuance of the Me Too Registrations in accordance with Section 4.2, PHC hereby grants to Eden the right of distribution under all existing and future
registrations for the Compositions or the Products (the “Distribution Rights”). Eden, at its option and expense, will be responsible
for filings, maintenance and applicable fees for any non-EPA Regulatory Approvals and all Distribution Rights. In the event PHC does not hold any
Regulatory Approval in a jurisdiction within the Territory in which Eden desires to obtain such Regulatory Approvals, Eden may, upon prior written
consent from PHC, which consent will not be unreasonably withheld or delayed, proceed to seek such Regulatory Approval in Eden’s name, at
Eden’s expense.

4.2    EPA
Amendments; Me Too Registrations. Promptly following the Effective Date, Eden will, at its own expense, seek New Product Me-Too Fast Track
Registrations (“Me Too Registration(s)”) under applicable EPA regulations for the home and garden applications of the Compositions.
PHC agrees, at its own expense, to cooperate and assist Eden, as reasonably requested by Eden, in providing access to and use of the supporting data
for such registrations, together with any assistance, documentation, certifications, test results or other information necessary for Eden to undertake
such registrations. Concurrently with the filing of the Me Too Registrations, PHC will, at its own expense, submit a master label amendment to the EPA
to delete from the existing EPA registrations (a) the home and garden coverage from each EPA registration label, and/or (b) the inclusion of home and
garden applications in the agricultural sections of each EPA Composition master label registration. Upon issuance of the Me Too Registrations, Eden
will (a) cease use of the EPA registrations held in Eden’s name for any new Product production; (b) modify all future Product labels to reflect
the Me Too Registration numbers issued directly to Eden; and (c) will undertaken new filings in connection with its Me Too Registrations to replace any
existing registrations for subdistributors appointed in accordance with Section 3.3.

4.3    Abandonment of Registration. Notwithstanding Section 4.1, PHC may, at its option, abandon any Regulatory
Approval with respect to a Composition provided (a) PHC gives advance notice of not less than ninety (90) days thereof to Eden; and (b) at Eden’s
option and sole cost and expense, PHC assists in transferring ownership of such Regulatory Approval and supporting data to Eden.

4.4    Labeling. Eden will be responsible for the content of the labeling for the Products prior to their
distribution and sale into the H&G Market, in accordance with applicable law.

4.5    Inspection. Upon prior written notice, PHC will cause Eden’s regulatory personnel to be provided with
reasonable access from time to time to the facilities and records of PHC related to the Compositions for the purpose of confirming PHC’s
compliance with all applicable laws and regulations.

4.6    Records and Recall. In the event of a recall of any of Product as a result of the inclusion of any
Composition, Eden will cooperate with and assist PHC in effecting such recall. PHC will pay, or reimburse Eden, for all reasonable out-of-pocket
expenses of effecting such recall of Products distributed by Eden under this Agreement, including any shipping costs related to returning recalled
Products to PHC and replacing such recalled Products with new Products at PHC’s expense; provided, however, that if the recall will have been
caused by (a) any component of the Product other than the Compositions; or (b) any breach of or default under this Agreement by Eden or any of its
subdistributors, then Eden will bear all the costs and expenses of the recall.

4

4.7    Export; Import. Unless otherwise agreed upon by Eden and PHC, all Compositions will be delivered by PHC to
Eden within the United States. Eden will be responsible for obtaining all import and/or export licenses and permits as may be required to import and/or
export the Products into and from countries selected by Eden, in accordance with then prevailing laws and regulations of such countries, and PHC will
cooperate with Eden in its efforts to obtain any such approvals. All such licenses and permits will be maintained in the name of Eden, whenever
feasible in accordance with prevailing laws and regulations. PHC will cooperate fully with Eden in its efforts to obtain any such
approvals.

5.    Failure of
Supply.

5.1    Failure of Supply. In the event PHC is unable or unwilling to provide to Eden any or all of the Compositions
on the terms and conditions provided for in this Agreement within sixty (60) days of any requested delivery date under a Purchase Order, Eden may, at
anytime during the continuation thereof, declare a Failure of Supply under the terms of this Section 5. Upon the occurrence of a Failure of Supply with
respect to any Compositions, Eden may, at its option, select and qualify a Second Source to make the Compositions for sale to Eden under this Agreement
subject to the following:

(a)    within
ninety (90) days after the occurrence of, or anytime during the continuation of, any Failure of Supply, Eden may give PHC written notice thereof and of
Eden’s desire to select and qualify a Second Source to make such Compositions for distribution to Eden under this Agreement;

(b)    Eden
will be responsible for the selection of any Second Source and may select as the Second Source itself or any third party that it reasonably determines
is or will be qualified to effectively make and deliver applicable Compositions in accordance with all applicable Regulatory Approvals and other
requirements comparable to those imposed on PHC under this Agreement; and

(c)    Eden
will promptly notify PHC of the selection and qualification of any Second Source (including, without limitation, the name, address and telephone number
of the Second Source, the particular Compositions to be made, and the qualifications of such Second Source to make such Compositions). Upon such
notification, PHC will cooperate in the qualification of such Second Source in accordance with any applicable regulatory authority, including, without
limitation, the EPA.

5.2    License. PHC hereby grants to Eden a license to the Licensed Intellectual Property solely to make or have
made by a Second Source solely for Eden, use, distribute, sell, have sold, import and otherwise commercialize and exploit the Compositions in the
Territory (subject to the terms of this Agreement) during that portion of the Term after the occurrence of a Failure of Supply with respect to such
Compositions, subject to and in accordance with the following:

(a)    Eden
will not exercise such license until the occurrence of a Failure of Supply with respect to any Compositions and Eden’s giving the notice described
in Section 5.1(a);

(b)    the
license includes the exclusive right to sell, distribute, have sold and otherwise commercialize and exploit the Compositions as a part of the Products
in the H&G Market in the Territory;

(c)    if
Eden elects to purchase Compositions directly from a Second Source then, notwithstanding any other provision of this Agreement, Eden will be
responsible, and PHC will be relieved of any responsibility, for assuring that the Compositions are manufactured, packaged and labeled by the Second
Source in accordance with the Regulatory Approvals;

(d)    if the
Second Source is a third party, the license will include a right to sell any Compositions made pursuant to the license to Eden or its subdistributors
for distribution as a part of the

5

Products in the Territory
under this Agreement, but not the right to sell or distribute the Compositions to any other party; and

(e)    Eden,
at its option, may record evidence of this license with any applicable authorities in order to confirm and secure the rights
hereunder.

5.3    Transition Support. Upon appointment of a Second Source by Eden following a Failure of Supply, PHC will
provide the following transition support:

(a)    PHC
will provide, at its own expense, reasonable documentation, standard operating procedures and transition assistance to the Second Source to enable the
Second Source to manufacture and/or supply the Compositions; and

(b)    PHC
will provide, at its own expense, a reasonable quantity of the seed used for fermentation and development of the Compositions.

5.4    Registrations. To the extent permitted by applicable regulations, upon a Failure of Supply, PHC will assist
the Second Source in securing all necessary rights under the Regulatory Approvals.

5.5    Termination of Failure of Supply. Any Failure of Supply initiated under this Section 5 may be terminated as
follows: (a) at the sole option and election of Eden, a Second Source may be terminated and the rights granted under this Section 5 concluded; or (b)
upon the mutual agreement of the parties, PHC may resume production and supply of the Compositions under the terms of this Agreement and any
corresponding rights of the Second Source will be terminated by Eden.

6.    Intellectual Property
Rights.

6.1    Claims By and Against PHC. PHC will have (a) the right to assert, or at its option settle, any claim or suit
necessary to enforce its Intellectual Property rights (including those in the Trademarks) against any third party; and (b) the right to defend against,
or at its option settle, any patent infringement claim relating to the Compositions made by any third party against PHC. PHC agrees to provide Eden
with commercially reasonable notice of each such claim or suit. PHC agrees to use commercially reasonable efforts to enforce its Intellectual Property
in the Compositions against any third party who PHC determines in its reasonable judgment (after consultation with Eden) is infringing such
Intellectual Property rights, provided that such infringement is likely to have a material adverse impact on Eden’s sales of the Products. PHC
will have sole control of the assertion or defense of any such action, including any appeals, settlement or compromise thereof, and will have full
authority to enter into a binding settlement or compromise; provided, however, that PHC will not enter into any settlement or compromise that would
obligate or affect Eden in an adverse manner with respect to its rights under this Agreement without Eden’s consent, which consent will not be
unreasonably withheld or delayed.

6.2    Claims Against Eden. PHC will have the option (but not the obligation) to assume and defend any infringement
claim made against Eden based upon the use of the Trademarks or the Compositions in association with the Products. Eden will promptly notify PHC of any
such claim and will offer to tender defense thereof to PHC. PHC will promptly (and in no event later than 30 days after receipt of notice) notify Eden
of its election or non-election to assume the defense of such claim. In the event PHC elects to assume the defense of and responsibility for any claim
under this Section 6.2, (a) at the request and expense of PHC, Eden will reasonably assist PHC in the defense; (b) PHC will have sole control of the
defense of any such action, including any appeals; and (c) PHC will have full authority to enter into a binding settlement or compromise, provided,
however, that PHC will not enter into any

6

settlement or compromise that
would adversely affect Eden’s rights under this Agreement without Eden’s consent, which consent will not be unreasonably withheld or delayed.
In the event PHC refuses or fails to assume any defense under this Section 6.2, Eden may, at its sole option and expense, defend, settle or otherwise
compromise such claim, provided, however, that Eden will not enter into any settlement or compromise that would adversely affect PHC without PHC’s
consent, which consent will not be unreasonably withheld or delayed. PHC agrees to provide, at its own expense, any assistance reasonably requested by
Eden.

6.3    Limitation of Liability. PHC will have no liability of any kind to Eden under this Section 6 to the extent
any such claim is based solely upon or arises solely out of (a) any use of any Trademark or Composition in a manner for which it was not approved,
designed or intended to be used, as specified herein or in its labeling, if and to the extent such use was promoted by Eden; (b) any modification of
any Trademark or Composition by Eden that causes either of them to become infringing; or (c) the use of any Composition in a manner inconsistent with
the applicable Regulatory Approvals, if and to the extent such use was promoted by Eden.

6.4    Replacement Product. Notwithstanding the foregoing, if it is adjudicatively determined that a Trademark or
Composition infringes, or, as a result of the Composition, a Product that incorporates the Composition infringes, or in PHC’s reasonable opinion
is likely to be found to infringe, a third party’s Intellectual Property rights, or if the sale or use of such Composition or Product is, as a
result, enjoined, then PHC will exercise commercially reasonable efforts to either (a) procure for Eden the right under such third party Intellectual
Property rights to sell the Products; or (b) modify the Trademarks or Compositions, after consultation with Eden, to allow Eden to market a substitute
Product.

6.5    Protection of Intellectual Property. During the Term, PHC will be responsible (a) for prosecuting and
maintaining all registrations and applications for the Patents and Trademarks existing as of the Effective Date; and (b) to the extent it deems
necessary or appropriate, for filing, prosecuting and maintaining any new or additional Intellectual Property rights associated with the
Compositions.

7.    Warranties.

7.1    Eden Corporate Warranties. Eden represents and warrants to PHC that the execution and delivery by Eden of
this Agreement and the performance by Eden of its obligations hereunder have been duly authorized by all requisite corporate action and to the best of
Eden’s knowledge will not violate any provision of law, any order of any court or other agency of government, the Articles of Incorporation or
Bylaws of Eden, as amended, or any provision of any indenture, agreement or other instrument to which Eden or any of its properties or assets is bound,
or conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any such indenture, agreement or other
instrument, or result in the creation or imposition of any lien, charge, restriction, claim or encumbrance of any nature whatsoever upon any of the
properties or assets of Eden. This Agreement has been duly executed and delivered by Eden and constitutes the legal, valid and binding obligation of
Eden, enforceable in accordance with its terms, subject, as to the enforcement of remedies, to the discretion of the courts in awarding equitable
relief and to applicable bankruptcy, reorganization, insolvency, moratorium and similar laws affecting the rights of creditors
generally.

7.2    PHC
Corporate Warranties. PHC represents and warrants to Eden that the execution and delivery by PHC of this Agreement and the performance by PHC of
its obligations hereunder have been duly authorized by all requisite corporate action and to the best of PHC’s knowledge will not violate any
provision of law, any order of any court or other agency of government, the Articles of Incorporation or Bylaws of PHC, as amended, or any provision of
any indenture, agreement or other instrument to which PHC or any of its properties or assets is bound, or conflict with, result in a breach of or
constitute (with

7

due notice or lapse of time
or both) a default under any such indenture, agreement or other instrument, or result in the creation or imposition of any lien, charge, restriction,
claim or encumbrance of any nature whatsoever upon any of the properties or assets of PHC. This Agreement has been duly executed and delivered by PHC
and constitutes the legal, valid and binding obligation of PHC, enforceable in accordance with its terms, subject, as to the enforcement of remedies,
to the discretion of the courts in awarding equitable relief and to applicable bankruptcy, reorganization, insolvency, moratorium and similar laws
affecting the rights of creditors generally.

7.3    PHC
Composition Warranties. PHC represents and warrants to Eden that, when delivered by PHC, all Compositions sold under this Agreement
will:

(a)    comply
with the Specifications and with all applicable laws and regulations, including design, manufacturing and labeling requirements, for the jurisdiction
where Regulatory Approvals have been obtained pursuant to Section 4.1; and

(b)    be
free of defects in workmanship and materials.

7.4    Remedy. PHC will replace or credit Eden’s account for any Composition that it reasonably determines did
not comply with the warranty provided at Section 7.3 at the time of delivery to Eden; provided, however, that PHC will have no obligation under this
warranty to make replacements or grant credits necessitated, in whole or in part, by (a) the failure of Eden to maintain any Compositions in accordance
with any transportation, storage, handling or maintenance instructions supplied by PHC; or (b) other fault or negligence of the Eden (except for any
strict liability of PHC). Prior to returning any Composition alleged to be defective, Eden will notify PHC in writing of the claimed defect, together
with the original invoice number and date. No Composition will be returned without first obtaining a returned goods authorization from PHC, which
authorization will not be unreasonably withheld or delayed.

7.5    Limited Warranty. THE EXPRESS WARRANTIES OF EACH PARTY SET FORTH IN THIS SECTION 7 ARE EXCLUSIVE AND ARE IN
LIEU OF ALL OTHER WARRANTIES OF EITHER PARTY, EXPRESS OR IMPLIED, WHICH ARE HEREBY SPECIFICALLY DISCLAIMED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE. IN NO EVENT WILL EITHER PARTY’S LIABILITY TO THE OTHER PARTY UNDER THIS
ARTICLE 7 EXTEND TO ANY SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, INCLUDING WITHOUT LIMITATION, LOST PROFIT, GOODWILL OR TREBLE
DAMAGES.

7.6    Limitation of Liability. PHC’S OBLIGATION TO REPAIR OR REPLACE ANY COMPOSITION, OR TO CREDIT
EDEN’S ACCOUNT FOR THE PURCHASE PRICE, WILL BE EDEN’S SOLE AND EXCLUSIVE REMEDY FOR ANY BREACH OF WARRANTY UNDER THIS ARTICLE 7.3. in no
event will PHC’S liability TO EDEN UNDER SECTION 7.3 exceed the TOTAL FEES paid by EDEN to PHC for the COMPOSITIONS giving rise to such
liability.

8.    Indemnification and Limitation
of Liability.

8.1    Eden’s Indemnity. Eden will indemnify, defend and hold harmless PHC, at Eden’s expense, from and
against any Claims brought against or incurred by PHC arising from any actions or omissions of Eden or its subdistributors in connection with the
distribution and sale of the Products, including, without limitation, any Claim based upon (a) a breach by Eden (or its subdistributors) of any
representation, warranty or other obligation of Eden under this Agreement; (b) the negligence or intentional misconduct of Eden, provided that in no
event will Eden be liable for matters for which PHC

8

is responsible under Section
8.2 or for punitive or exemplary damages; or (c) Product Liability Damages with respect to the failure of any Compositions produced by Eden or a Second
Source pursuant to Article 5. Eden will maintain product liability insurance or self-insurance in such amounts as ordinary good business practice for
its type of business would make advisable and will provide PHC with evidence of this coverage.

8.2    PHC’s Indemnity. PHC will indemnify, defend and hold harmless Eden, at PHC’s expense, from and
against any Claims brought against or incurred by PHC arising from any act or omission of PHC or any third party acting on PHC’s behalf,
including, without limitation, any Claim based upon (a) a breach of any representation, warranty or other obligation of PHC under this Agreement; (b)
the negligence or intentional misconduct of PHC, provided, however, that in no event will PHC be liable for matters for which Eden is responsible for
under Section 8.1 or for punitive or exemplary damages; and (c) Product Liability Damages with respect to the failure of any Compositions purchased by
Eden from PHC. PHC will maintain product liability insurance or self-insurance in such amounts as ordinary good business practice for its type of
business would make advisable and will provide Eden with evidence of this coverage.

8.3    Limitation on PHC’s Liability. PHC will not be liable under any circumstances to Eden (or to any third
party, to the extent such limitation is permitted under applicable law) for any special, indirect, consequential or punitive damages, including, but
not limited to, loss of profits, loss of business opportunities or loss of goodwill, even if advised of the possibility of such damages. EXCEPT FOR
CLAIMS ARISING UNDER SECTIONS 8.2(B), 8.2(C), OR 9.1, in no event will PHC’S liability for the supply of the COMPOSITIONS to eden exceed the FEES
paid by EDEN to PHC for the COMPOSITIONS giving rise to such liability, or, if such liability does not relate to specific COMPOSITIONS, in no event
will PHC’s liability exceed the amount of FEES paid by EDEN to PHC for COMPOSITIONS pursuant to this Agreement during the six (6) month period
immediately preceding the event giving rise to such liability. PHC will have no liability of any kind to Eden under Section 8.2 to the extent a
claim is based solely upon or arises solely out of the following: (a) the use of any Composition in a manner for which it was not designed or intended
to be used as specified herein or in its labeling; (b) any modification, alteration or damage to any Compositions by Eden or any third party that
causes it to become unsafe; or (c) the use of any Composition in a manner inconsistent with the applicable Regulatory Approvals in the jurisdiction of
such use.

8.4    Limitation on Eden’s Liability. Eden will not be liable under any circumstances to PHC (or to any third
party, to the extent such limitation is permitted under applicable law) for any special, indirect, consequential or punitive damages, including, but
not limited to, loss of profits, loss of business opportunities or loss of goodwill, even if advised of the possibility of such damages. EXCEPT FOR
CLAIMS ARISING UNDER SECTIONS 8.1(B), 8.1(C) OR 9.1, in no event will EDEN’S liability to PHC exceed the amount of FEES PAYABLE by EDEN to PHC
UNDER this Agreement during the six (6) month period immediately preceding the event giving rise to such liability.

8.5    Procedure. If a Claim by a third party is made and a party (the “Indemnitee”) intends to
claim indemnification under this Article 8, the Indemnitee will promptly notify the other party (the “Indemnitor”) in writing of any
Claim in respect of which the Indemnitee, or any of its subsidiaries, directors, officers, employees, shareholders, suppliers, distributors or
subdistributors, intends to claim such indemnification and the Indemnitor will have sole control of the defense and/or settlement thereof, provided
that the Indemnitee may participate in any such proceeding with counsel of its choice at its own expense. The indemnity agreement in this Article 8
will not apply to amounts paid in settlement of any

9

Claim if such settlement is
effected without the consent of the Indemnitor, which consent will not be unreasonably withheld or delayed. The failure to deliver written notice to
the Indemnitor within a reasonable time after the commencement of any such action will relieve such Indemnitor of any liability to the Indemnitee under
this Article 8 only to the extent such failure is adversely prejudicial to its ability to defend such action. If the Indemnitor fails to provide
defense of the Claim or to diligently defend or settle the same, the Indemnitee may defend or settle the Claim without prejudice to its rights to
indemnification hereunder, provided that the Indemnitee does so diligently and in good faith. The Indemnitee may not enter into any settlement or agree
to any stipulation that would adversely affect the rights of the Indemnitor or impose any additional obligation on the Indemnitor without the providing
prior written notice to the Indemnitor. The Indemnitee, its employees and agents, will cooperate fully with the Indemnitor and its legal
representatives and provide full information in the investigation of any Claim, in order to be covered by this indemnification.

9.    Confidentiality.

9.1    Confidential Information. Each party agrees to use commercially reasonable efforts to prevent any disclosure
of the Confidential Information of the other party to any third parties by its agents or employees. Upon any termination of this Agreement, any
Confidential Information of a party that has been provided to the other party will be returned upon written request.

9.2    Agreement Confidentiality. In the event any party proposes to issue any press release or public announcement
concerning any of the provisions of this Agreement or the transactions contemplated hereby, such party will so advise the other party hereto, and the
parties will thereafter use their best efforts to cause a mutually agreeable release or announcement to be issued. Neither party will publicly disclose
or divulge any provisions of this Agreement or the transactions contemplated hereby without the other party’s written consent, except as may be
required by any regulatory authority or by applicable law or regulation to confirm a party’s rights or obligations hereunder, and except for
communications to such party’s employees or customers, or to investors or prospective investors, in each case subject to appropriate
confidentiality obligations.

10.    Term;
Termination.

10.1    Term. This Agreement will take effect as of the Effective Date and will continue until the expiration of
the last of the Patents to expire. Thereafter, this Agreement will automatically extend for additional consecutive five (5) year periods.
Notwithstanding the foregoing, Eden may terminate this Agreement at any time, with or without cause, provided a Failure of Supply is not then in
effect, by giving not less than thirty (30) days’ written notice to PHC.

10.2    Rights and Obligations on Termination. Upon termination of this Agreement, the parties will have the
following rights and obligations:

(a)    termination of this Agreement will not release Eden from the obligation to make payment of all amounts previously
due and payable; and

(b)    Eden
may continue to sell any Products on hand in the H&G Market in the Territory for a period of up to twelve (12) months after the effective date of
termination, subject to applicable Regulatory Approvals and provided any such continued sale of the Products shall be subject to the terms of this
Agreement set forth at Sections 2.3, 3.1, 7, 8, 9, 11 and 12.

10.3    Remedies in the Event of Breach. Notwithstanding the terms of this Section 10, nothing in this Agreement
will preclude either party from declaring the other party to be in breach of its

10

performance obligations under
this Agreement if such party fails to cure any material breach within thirty (30) days after notice thereof from the other party. Upon a declaration of
breach, (a) the non-breaching party may seek recovery of monetary damages from the breaching party in a court of applicable jurisdiction; and (b) if
PHC is the non-breaching party, PHC may withhold delivery of any outstanding Purchase Orders and otherwise suspend its performance under this Agreement
without liability until such breach is remedied by Eden. PHC’s failure to fulfill any outstanding Purchase Orders or to supply Compositions to
Eden, or PHC’s suspension of its performance under this Agreement, due to Eden’s uncured material breach shall not constitute a Failure of
Supply.

11.    Miscellaneous.

11.1    Relationship of the Parties. Each party is an independent contractor to the other in the operation and
administration of this Agreement. Nothing in this Agreement will be construed as creating a partnership or joint venture between the
parties.

11.2    Compliance with Laws. PHC and Eden will each be responsible for compliance with present and future
applicable statutes, laws, ordinances and regulations of national, federal, state and local governments in the Territory now or hereafter in effect
relating to all activities with respect to the Products and compliance with this Agreement.

11.3    Governing Law and Compliance. This Agreement will be governed by the internal substantive laws of the
Commonwealth of Pennsylvania without respect to its conflicts of law principles. The parties agree that the exclusive jurisdiction and venue of any
legal action arising out of this Agreement will be the state or federal courts located in Pittsburgh, Pennsylvania, and each party hereby submits
itself to the exclusive jurisdiction and venue of those courts for the purposes of such action. Notwithstanding the above, PHC, in its sole discretion,
may bring an action against Eden in any other court of competent jurisdiction.

11.4    Assignment. Neither party will assign their rights or obligations under this Agreement without the prior
written consent of the other party, which consent will not be unreasonably withheld or delayed; provided, however, that either party may: (a) assign
this Agreement in its entirety to a wholly owned and controlled affiliate or an affiliate under common control and ownership; or (b) assign this
Agreement to a successor to all or substantially all of such party’s business or assets by way of acquisition or merger, provided such successor
assumes and agrees to perform all of the obligations of the assignor under this Agreement. Notwithstanding the foregoing, in the event PHC assigns any
part of its business or obligations in any manner that prevents Eden from having adequate supply of or ability to purchase the Compositions, such event
will be deemed a Failure of Supply as of the effective date of such assignment by PHC, and the provisions of Section 5 herein will
apply.

11.5    Complete Agreement. This Agreement, and the Exhibits hereto, constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof and supersedes all prior agreements whether written or oral relating hereto.

11.6    Waiver, Amendment. The failure of either party to enforce at any time any of the provisions of this
Agreement will not, absent an express written waiver signed by such party specifying the provision being waived, be construed to be a waiver of any
such provision, nor in any way to affect the validity of this Agreement or any part thereof or the right of the party thereafter to enforce each and
every such provision. No waiver of any breach of this Agreement will be held to be a waiver of any other or subsequent breach. Any amendment to this
Agreement will be in writing and signed by both parties.

11

11.7    Notices. All notices or other communications to a party required or permitted hereunder will be in writing
and will be delivered personally or by facsimile (receipt confirmed electronically) to such party (or, in the case of an entity, to an executive
officer of such party) or will be sent by a reputable express delivery service or by certified mail, postage prepaid with return receipt requested,
addressed as follows:

	If to Eden,
to:
	   	   	   	if to
PHC, to:

	11816 North
Creek Parkway N.
	   	   	   	440
William Pitt Way

	Bothell, WA
98011
	   	   	   	Pittsburg, PA 15238

	 
	Attn:

	   	   	   	Attn:

	 
	Facsimile:
with a copy to:
 

	   	   	   	Facsimile:
with a copy to:

	Facsimile:

	   	   	   	Facsimile:

 

Either party may change the above-specified recipient
and/or mailing address by notice to the other parties given in the manner herein prescribed. All notices will be deemed given on the day when actually
delivered as provided above (if delivered personally or by telecopy) or on the day shown on the return receipt (if delivered by mail or delivery
service).

11.8    Expenses. Except as expressly provided herein, PHC and Eden will pay their own expenses incident to this
Agreement and the preparation for, and consummation of, the transactions provided for herein.

11.9    Illegality; Severability. In case any provision of this Agreement is found to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired
thereby.

11.10    Benefit. Nothing in this Agreement, expressed or implied, is intended to confer on any person other than
the parties hereto or their respective successors or assigns, any rights, remedies, obligations or liabilities under or by reason of this
Agreement.

11.11    Counterparts. This Agreement may be executed in any number of counterparts, each of which will be deemed
as original and all of which together will constitute one instrument.

11.12    Execution of Further Documents. Each party agrees to execute and deliver without further consideration any
applications, licenses, assignments or other documents, and to perform any other lawful acts as the other party may reasonably require to fully secure
or evidence the rights or interests herein.

12.    Defined
Terms.

12.1    “Claim(s)” means all demands, claims, actions or causes of action, assessments, losses, damages,
liabilities, interest or penalties and costs and expenses of any nature, including, without limitation, disbursements, third party costs, settlements
and reasonable attorney fees.

12.2    “Composition(s)” means the chemical formulations identified at Exhibit A.

12

12.3    “Confidential Information” means any confidential, proprietary or trade secret information,
whether of a technical, business or other nature (including, without limitation, information relating to regulatory submissions, technology, software,
products, services, designs, methodologies, business plans, finances, marketing plans, customers, prospects or other affairs), disclosed in writing and
marked “Confidential” during the term of this Agreement or the term of the Confidentiality Agreement by the Disclosing Party to the Receiving
Party, or if disclosed orally during either such term, is reduced to writing within the later of thirty (30) days of such disclosure or thirty (30)
days of the Effective Date, excluding information that (a) was already in the possession of the Receiving Party prior to its receipt from the
Disclosing Party under this Agreement or the Confidentiality Agreement (provided that the Receiving Party is able to provide the Disclosing Party with
reasonable documentary proof thereof); (b)is or becomes part of the public domain by reason of acts not attributable to the Receiving Party; (c) is or
becomes available to the Receiving Party from a source other than the Disclosing Party which source, to the best of the Receiving Party’s
knowledge, has rightfully obtained such information and has no obligation of nondisclosure or confidentiality to the Disclosing Party with respect
thereto; (d) is made available by the Disclosing Party to a third party unaffiliated with the Disclosing Party on an unrestricted basis; (e) is
independently developed by the Receiving Party completely without reference to any Confidential Information of the Disclosing Party, as evidenced by
the Receiving Party’s written records; or (f) has been or must be publicly disclosed by reason of legal, accounting or regulatory requirements
beyond the reasonable control, and despite the reasonable efforts, of the Receiving Party.

12.4    “EPA” means the United States Environmental Protection Agency or its successors.

12.5    “Failure of Supply” means a failure of supply by PHC as defined at Section 5.

12.6    “Home and Garden Market” or “H&G Market” means sales (a) directly to the
general public; (b) to resellers or businesses that offer the Products to retailers or to the general public; and (c) to businesses that incorporate
the Products into existing or new products to be sold to the general public, provided such Product sales are for the purposes of the protection of
plants and seeds and the promotion of overall plant health. Eden will ensure that sales of the Products in the H&G Market is limited to packaged
products that contain less than two (2) ounces of the Composition each.

12.7    “Intellectual Property” means letters patent and patent applications; trademarks, service marks
and registrations thereof and applications therefor; copyrights and copyright registrations and applications; mask works and registrations thereof and
applications therefor; and all inventions, discoveries, ideas, technology, know-how, trade secrets, trade dress, data, information, processes,
formulas, drawings and designs, licenses, computer programs, software source code and object code, and all amendments, modifications and improvements
thereto that are proprietary to a party hereto and for which such patent, trademark, copyright or mask work protections may exist and/or may be sought
and obtained.

12.8    “Licensed Intellectual Property” means, with respect to a Failure of Supply, all Intellectual
Property (excluding the Trademarks) and Regulatory Approvals (to the extent they can be licensed or otherwise made available under applicable law) used
or held by PHC in connection with the manufacture or sale of the Compositions at the time of such Failure of Supply.

12.9    “Patent(s)” means any U.S. or foreign patents or patent applications relating to the Compositions
held or acquired by PHC in connection with the Asset Purchase Agreement, together with any continuation, counterpart, divisional, issue, reissue,
extension, renewal or reexamination of any of such patents or applications.

13

12.10    “Product(s)” means the Products incorporating the Compositions that are produced and sold by
Eden as identified at Exhibit A.

12.11    “Product Liability Damages” means any liability, claim or expense, including but not limited to
reasonable attorneys’ fees and medical expenses, arising in whole or in part out of claims of third parties for personal injury or loss of or
damage to property relating to or arising out of the use of the Compositions or the Products, whether based on strict liability in tort, negligent
manufacture of product, or any other allegation of liability arising directly from the design, testing, manufacture, packaging, labeling (including
instructions for use), or sale of the Compositions or the Products, but excluding any liability, claim or expense based on contract (including, without
limitation, warranty).

12.12    “Purchase Order(s)” means any purchase order submitted by Eden and accepted or required to be
accepted by PHC in accordance with Article 3.6.

12.13    “Regulatory Approval” means any approval, permit, license or other authorization that is
required prior to the marketing or distribution of the Compositions or the Products in any part of the Territory in accordance with then prevailing
laws and regulations.

12.14    “Second Source” means a second source for any Product selected and qualified by Eden pursuant to
Section 5.1.

12.15    “Specifications” means the specifications for the Compositions as detailed in the applicable EPA
registrations.

12.16    “Term” means the period specified in Section 10.1.

12.17    “Territory” means all countries worldwide.

IN WITNESS WHEREOF, the parties
hereto have caused this Agreement to be executed by their duly authorized representatives as of the Effective Date.

	PHC:
	   	   	   	EDEN:

	 
	PLANT HEALTH
CARE, INC.
	   	   	   	EDEN BIOSCIENCE CORPORATION

	 
	By: 

	   	   	   	By: 

	 
	Name: 

	   	   	   	Name: 

	 
	Title: 

	   	   	   	Title: 
;

 

Attachments: Exhibit A, Exhibit B

14

EXHIBIT A

Products

Any current or future product sold in the H&G Market
that incorporates the Compositions

Compositions

HarpinEA

Harpinαβ

Any additional Harpin protein-based products that are
available or developed for sale

Trademarks

Messenger

Messenger

Harp-N-Tek

15

EXHIBIT B (Page 1 of 4)

JURISDICTIONS WHERE REGULATORY APPROVAL EXISTS FOR
DISTRIBUTION

US PRODUCTS

a.    U.S. federal regulatory
approvals held in the name of Eden Bioscience Corporation:

i.  US EPA Reg. No.
69834-2 (3% harpinEA)

	ii.  
	 	US EPA Reg. No. 69834-4 (1% harpinEA) — Turf &
Ornamental Label—no commercial products, no state registrations.

	iii.  
	 	US EPA Reg. No. 69834-5 (1% harpinαβ)

	iv.  
	 	US EPA Reg. No. 69834-6 (3% harpinEA) — me too registration
for dried milk seed treatment. No state registrations.

	v.  
	 	US EPA Reg. No. 80967-1-69834 (41% glyphosate) — Eden
private label distributor registration/subregistration from MEY Corporation.

	b.    
	 	U.S. federal regulatory applications currently pending at the
EPA submitted in the name of Eden Bioscience Corporation*:

	i.  
	 	US EPA File Symbol 69834-T (1% harpinαβ) — me too
registration for seed treatment dried milk formulation (EBC-353).

	ii.  
	 	US EPA File Symbol 69834-I (0.25% harpinαβ) — new product
registration for seed treatment dried milk formulation (EBC-354).

	iii.  
	 	US EPA File Symbol 69834-O (0.0125% harpinαβ + fertilizer)
—EBC-280.

	iv.  
	 	US EPA File Symbol 69834-RN (0.1% harpinαβ + fertilizer)
—EBC-281.

	v.  
	 	US EPA File Symbol 69834-RR (0.00125% harpinαβ + fertilizer)
— EBC-282.

* Note: Items c. iii, iv and v. are combination
pesticide-fertilizer products that will require separate state registrations for both the pesticide and the fertilizer

	c.    
	 	U.S. Fertilizer Products with Harp-N-TekTM—Registrations and/or Licenses held by Eden Bioscience Corporation**

	i.  
	 	MightyPlantTM 18-18-18 plus micronutrients — Water Soluble All-Purpose Plant Food

	ii.  
	 	MightyPlant CitruSSet 15-0-40 — Professional Water
Soluble Fertilizer

	iii.  
	 	MightyPlant 9-15-30 — Professional Water Soluble
Fertilizer

	iv.  
	 	MightyPlant 11-41-8 — Professional Water Soluble
Fertilizer

** Note: Federal Registration is not required for
fertilizer products in the US. No pesticide claims are included on the MightyPlant labels and such products only require state registration/license as
a fertilizer

16

EXHIBIT B (Page 2 of 4)

d.    U.S. state regulatory product
label approvals for harpin AB:

		 	 	   	ProAct
 (2lb 8oz)
 	   	Extend
 	   	E-Glyphosate
 Plus CoPAck
 (30 gal+1lb
4oz)
 	   	Messenger
 STS (2 lb)
 	   	N-Hibit (CST)
 (15 oz)
 	   	N-Hibit (hopper box)
 (12oz)
 
	US
EPA
	   	   	   	Approved
	   	Approved
	   	Approved
	   	Approved
	   	Approved
	   	Approved

	Alabama
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Alaska
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Arizona
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Arkansas
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	California
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Limited
	   	Not
Submitted
	   	Not
Submitted

	Colorado
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Connecticut
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Delaware
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Florida
	   	   	   	Approved
	   	Approved
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Georgia
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Hawaii
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Idaho
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Illinois
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Indiana
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Iowa
	   	   	   	Approved
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved
	   	Approved

	Kansas
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Kentucky
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Louisiana
	   	   	   	Approved
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved
	   	Approved

	Maine
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Maryland
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Massachusetts
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Michigan
	   	   	   	Approved
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved
	   	Approved

	Minnesota
	   	   	   	Approved
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved
	   	Approved

	Mississippi
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Missouri
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Montana
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Nebraska
	   	   	   	Approved
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved
	   	Approved

	Nevada
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	New
Hampshire
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	New
Jersey
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	New
Mexico
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	New
York
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	North
Carolina
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	North
Dakota
	   	   	   	Approved
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved
	   	Approved

	Ohio
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Oklahoma
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Oregon
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Pennsylvania
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Rhode
Island
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	South
Carolina
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	South
Dakota
	   	   	   	Approved
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved
	   	Approved

	Tennessee
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Texas
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Utah
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Vermont
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Virginia
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Washington
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	West
Virginia
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Wisconsin
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Approved
	   	Approved

	Wyoming
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Washington
DC
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

	Puerto
Rico
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Approved
	   	Not
Submitted
	   	Not
Submitted

 

17

EXHIBIT B (Page 3 of 4)

e.    State regulatory approvals for
MightyPlant products with Harp-N-Tek and for employ***

		 	 	   	MightyPlant
 (AG)
 	   	MightyPlant
 (AG)
 	   	MightyPlant
 (AG)
 	   	MightyPlant
 (AG)
 	   	Employ
 
		 	 	   	18-18-18 (25 lb)
 	   	15-0-40 (25 lb)
 	   	11-41-8 (25 lb)
 	   	9-15-30 (25 lb)
 	   	(5oz)
 
	US
EPA
	   	   	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated

	Alabama
	   	   	   	Approved
	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Alaska
	   	   	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated

	Arizona
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Arkansas
	   	   	   	Approved
	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	California
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Colorado
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Connecticut
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Approved

	Delaware
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Florida
	   	   	   	Approved
	   	Approved
	   	Approved
	   	Approved
	   	Not
Regulated

	Georgia
	   	   	   	Approved
	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Hawaii
	   	   	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated
	   	Not
Approved

	Idaho
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Illinois
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Indiana
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Iowa
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Kansas
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Kentucky
	   	   	   	Not
Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Louisiana
	   	   	   	Approved
	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Maine
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Approved

	Maryland
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Massachusetts
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Michigan
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Minnesota
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Mississippi
	   	   	   	Approved
	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Missouri
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Montana
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Nebraska
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Nevada
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	New
Hampshire
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	New
Jersey
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	New
Mexico
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	New
York
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	North
Carolina
	   	   	   	Approved
	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	North
Dakota
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Ohio
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Oklahoma
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Oregon
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Pennsylvania
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Rhode
Island
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	South
Carolina
	   	   	   	Approved
	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Approved

	South
Dakota
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Tennessee
	   	   	   	Approved
	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Texas
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Utah
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Vermont
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Virginia
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Washington
	   	   	   	Not
Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	West
Virginia
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Wisconsin
	   	   	   	Approved
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

	Wyoming
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Regulated

	Washington
DC
	   	   	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated
	   	Not
Regulated

	Puerto
Rico
	   	   	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Submitted
	   	Not
Approved

 

*** Note: employTM Non-Plantfood Product is labeled for enhancement of nutrient uptake when applied as a tank mix with foliar
nutritional products. employ is not subject to EPA registration and many states do not regulate products with such claims

18

EXHIBIT B (Page 4 of 4)

INTERNATIONAL PRODUCT APPROVALS

f.    International regulatory
approvals for harpin EA:

3% harpinEA product is approved for use
in several foreign countries on a variety of crops. This material is regulated as a pesticide in some countries, elsewhere it is designated a PGR,
Plant Strengthener, or Biostimulant, etc. and in some countries it is not regulated. See regulatory approval table below for list of
countries.

g.    International regulatory
approvals for harpinαβ:

1% harpinαβ; product is approved
for use in Germany as a Plant Strengthener on all crops.

h.    International regulatory
applications currently being sought for harpinαβ:

1% harpinαβ product is pending
for use in Spain as a fertilizer on all crops

International Approvals:

	4. Country
	
	
	  
	Status (Registrant)

	USA (including Puerto Rico)
	   	   	   	Registered (Eden)

	Mexico
	   	   	   	Registered (Eden Bioscience Mexico)

	China
	   	   	   	Approved, pending for the certificate

	Guatamala
	   	   	   	Registered (DuWest)

	Honduras
	   	   	   	Registered (DuWest)

	Panama
	   	   	   	Registered (Eden)

	Costa Rica
	   	   	   	Registered (DuWest)

	El Salvador
	   	   	   	Registered (DuWest)

	Ecuador
	   	   	   	Registered (UAP)

	Germany
	   	   	   	Approved (Eden)

	Morocco
	   	   	   	Considered as fertilizer; exempt from registration

	Lesotho, Rwanda, Swaziland, Tanzania, Uganda,
	   	   	   	Not subject to registration

	Egypt
	   	   	   	Registered (AMC — Agricultural Materials
 Company holds license for trading)

	Kuwait, Jordan, Oman, Quatar,
	   	   	   	Can be sold on the basis of the final US EPA registration certificate

	United Arab Emirates
	   	   	   	Registered (Eden listed as producer and AMC is listed as importer)

	Spain
	   	   	   	Registered (Eden Bioscience Europe SARL)

	Cyprus
	   	   	   	Registered (Manufacturer Eden Bioscience; applicant: E.H. Alevras & Sons Agricultural House Ltd);
registration expires in November 2007

	Finland
	   	   	   	Exempt From Registration

	Nicaragua
	   	   	   	Registered (Eden)

	Turkey
	   	   	   	Registered (Agricultural Materials
 Company -Turkey)

	Greece
	   	   	   	Exempt from registration

	Columbia
	   	   	   	Registered (Clavio Benitez Ltd.; to be transferred to Agro S.A.))

	South Africa
	   	   	   	Not toxic; no registration needed (info from Dany Sapsford)

 

ProAct International registration
status—Germany (Eden)

19

Exhibit C

Guaranty

FORM OF
 GUARANTY

This guaranty (the
“Guaranty”) is entered into as of ____________, 200  by PLANT HEALTH CARE plc, a public limited company duly organized and existing under the laws
of England and Wales (“Guarantor”) for the benefit of EDEN BIOSCIENCE CORPORATION, a Washington corporation
(“Payee”).

RECITALS

A.    Pursuant to the terms of an Asset Purchase Agreement (the “Agreement”) of dated __________, 2006 between
Payee and Plant Health Care, Inc., a Pennsylvania corporation and a subsidiary of Guarantor (“Maker”), under which Maker agreed to purchase
certain assets and assume certain obligations of Payee, Maker has delivered to Payee concurrently herewith a Secured Promissory Note in the original
principal amount of $1,000,000 (the “Note”), along with a Security Agreement and Patent and Trademark Security Agreement (the “Security
Agreement”). The Agreement, the Note, this Guaranty, and the Security Agreement, along with any amendments or modifications thereto, or
instruments delivered in connection therewith, are collectively referred to herein as the “Documents.” Capitalized terms used in this
Guaranty that are not defined herein shall have the meanings assigned to those terms in the Agreement.

B.    Guarantor is the indirect parent of Maker and, as such, will derive direct and indirect economic benefits from the
Agreement, including without limitation the provisions of the Note.

C.    One of
the conditions precedent to the obligations of Payee to consummate the transactions contemplated by the Agreement is receipt by Payee of this Guaranty
from Guarantor. Guarantor is executing this Guaranty in order to satisfy that condition. Payee would not have accepted the Note but for the execution
and delivery of this Guaranty.

NOW, THEREFORE, for valuable
consideration, and in order to induce Payee to enter into the Agreement, Guarantor agrees as follows:

SECTION I

UNCONDITIONAL GUARANTY

Guarantor unconditionally,
absolutely, and irrevocably guarantees payment and performance of all present and future debts, liabilities, and obligations of Maker to Payee under
the Note, including, but not limited to, the due and punctual payment of the principal and interest owed pursuant to the Note, whether according to the
present terms of the Note, or at any earlier or accelerated date or dates as provided therein, or pursuant to any amendment, modification, or
replacement of the Note (collectively, the “Obligations”). The liability of Guarantor under this Guaranty includes accrued interest on any
sum due under this Guaranty (calculated at the highest rate of interest in effect under the Note at the time in question) and expenses due pursuant
to

-1-

Section 10.6 of this
Guaranty; provided, however, that the Obligations shall be subject to the rights of setoff provided to Maker under the Note.

SECTION II

WAIVERS BY GUARANTOR AND RIGHTS OF PAYEE

Guarantor intends that it shall
remain unconditionally liable for payment of the Obligations regardless of any act or omission that otherwise might operate as a legal or equitable
defense to discharge Maker, Guarantor, or any other guarantor of the Obligations in whole or in part. Therefore, Guarantor hereby waives any defense it
has or may have to the enforceability of its obligations under this Guaranty (except those matters, if any, that may not be waived under the Uniform
Commercial Code of the State of Delaware (the “UCC”) or other applicable law) by virtue of any of the following and, subject to the terms of
the Documents and applicable law, Payee may do any of the following things as many times as Payee wishes, without Guarantor’s permission and
without notifying Guarantor, and this will not affect Guarantor’s promise to pay the entire amount of the Obligations:

(a)  Payee does not
have to notify Guarantor of Payee’s acceptance of this Guaranty;

(b)  Payee does not
have to notify Guarantor of (i) Maker’s failure to pay all or any portion of the Obligations when due, or (ii) Maker’s failure to perform any
other obligation under the Note;

(c)  Payee may extend,
renew, accelerate, or otherwise change the time for payment of any of Maker’s obligations to Payee;

(d)  Payee may make any
other changes to the Note pursuant to the terms of the Note;

(e)  Payee may release
Maker, any other guarantor of the Obligations, or anyone else against whom Payee may have the right to collect amounts that may become due under the
Note;

(f)  Payee may use the
Collateral to satisfy the Obligations (in whole or in part, as applicable) and direct the order or manner of sale thereof pursuant to the terms and
conditions of the Security Agreement in Payee’s good faith discretion;

(g)  Payee may apply
any money or Collateral received from or on behalf of Maker to the repayment of any indebtedness due to Payee from Maker in any order that Payee
elect;

(h)  Payee may release,
surrender, substitute, add, or exchange any Collateral that Payee now holds or may later acquire as security for the Obligations, or Guarantor’s
obligations hereunder;

(i)  Payee may forbear
from or forego pursuing Maker, or from foreclosing or otherwise realizing upon any security interest, letter of credit, or other
guaranty;

-2-

(j)  Payee may impair
any Collateral, or Guarantor’s obligations hereunder, by Payee’s acts or omissions, including, but not limited to, Payee’s failure to
perfect a security interest in any Collateral;

(k)  Guarantor hereby
waives any defense arising out of the absence, impairment, or loss of (i) any or all rights of recourse, reimbursement, contribution, or subrogation,
or (ii) any other right or remedy of Guarantor against Maker, any other party, or any Collateral;

(l)  Guarantor hereby
waives any defense (i) arising by reason of any invalidity, ineffectiveness, or unenforceability of all or any portion of any of the Documents, or (ii)
otherwise available to or asserted by Maker (other than full payment in cash);

(m)  Guarantor waives
diligence, demand for performance, notice of nonperformance, presentment, protest, notice of dishonor, and indulgences and notices of every other kind;
and

(n)  Guarantor agrees
that Payee in its sole and absolute discretion may proceed against all or any portion of the Collateral by way of either judicial or nonjudicial
foreclosure in accordance with the terms of the Security Agreement and applicable law.

If Guarantor pays the Obligations
in accordance with the terms of this Guaranty, Payee shall assign Payee’s rights with respect to the Obligations under the Note and the Security
Agreement to Guarantor (without recourse, warranty, or representation) provided, however, that such assignment shall be subject to the terms of this
Guaranty, including the waivers set forth in this Section II of this Guaranty.

SECTION III

PAYEE’S RIGHT NOT TO PROCEED AGAINST MAKER,
 OTHER
GUARANTORS, OR COLLATERAL

If an Event of Default occurs
under the Security Agreement and is continuing, Payee may enforce this Guaranty against Guarantor (a) without attempting to collect or without
exhausting efforts to collect from Maker, any other guarantor, or anyone else who is or may be liable for the Obligations, or (b) without attempting to
enforce the rights of Payee in any Collateral. Without limiting the foregoing, Payee may sue on the Note, may elect not to sue on the Note, may elect
not to enforce the security interest in some or all of the Collateral, may sue less than all of the guarantors of the Obligations, or may take any
other action authorized under the Documents or by law. In each case, Payee shall have the right to exercise all available remedies in whatever order
Payee elects in accordance with the terms of the Agreement and applicable law and may join Guarantor in any suit on the Documents, or may proceed
against Guarantor in a separate proceeding. In case of suit, sale, or foreclosure, only the net proceeds therefrom, after deducting all charges and
expenses of any kind and nature whatsoever, shall be applied to the reduction of the amount due on the Note (or other Documents, as applicable), and
Payee shall not be required to institute or prosecute proceedings to recover any deficiency as a condition of payment under or enforcement of this
Guaranty. At any sale of all or any portion of the Collateral, Payee may in its discretion purchase all or any part of the Collateral and
may

-3-

apply against the amount bid
therefor all or any portion of the balance of the Obligations. Guarantor hereby waives to the fullest extent permitted by applicable law at the time in
question (including the UCC) the right to object to the amount that may be bid by Payee at such foreclosure sale.

SECTION IV

BANKRUPTCY AND ASSIGNMENT OF RIGHTS

Guarantor agrees that its
obligation to pay the Obligations under the terms of this Guaranty shall not be impaired, modified, changed, released, or limited in any manner by any
impairment, modification, change, release, defense, or limitation of the liability of Maker, or by the appointment of or existence of a receiver,
trustee, debtor-in-possession, or estate under any bankruptcy or receivership case or proceeding with respect to Maker. That means, among other things,
that if acceleration of the time for payment of any amount payable by Maker under any Document is stayed upon the insolvency, bankruptcy, or
reorganization of Maker, all amounts owed by Maker to Payee that otherwise are subject to acceleration under the terms of the Documents nonetheless
immediately shall be due and payable by Guarantor upon demand by Payee under this Guaranty for payment of such amounts (together with interest thereon
in accordance with the last sentence of Section I of this Guaranty, regardless of whether Payee is entitled to recover such interest from Maker in any
bankruptcy case filed by or with respect to Maker). Furthermore, if any payment made by Maker is reclaimed in a bankruptcy or receivership case or
proceeding, Guarantor shall pay to Payee the amount reclaimed. Guarantor further assigns to Payee all rights Guarantor has or may have against Maker in
any case or proceeding under the United States Bankruptcy Code, or any receivership or insolvency case or proceeding, until the Obligations have been
paid in full. This assignment includes all rights of Guarantor to be paid by Maker even if those rights have nothing to do with this Guaranty. This
assignment does not prevent Payee from enforcing Guarantor’s obligations under this Guaranty in any way.

SECTION V

GUARANTOR’S DUTY TO KEEP INFORMED OF MAKER’S AND
OTHER
 GUARANTORS’ FINANCIAL CONDITION

Guarantor now is informed
adequately of Maker’s financial condition, and Guarantor agrees to keep so informed. Guarantor acknowledges that Payee has no obligation to
provide Guarantor with any present or future information concerning the financial condition of Maker and changes in Maker’s or Guarantor’s
financial condition shall not affect Guarantor’s obligations under this Guaranty. Guarantor has not relied on financial information furnished by
Payee, and Guarantor will not do so in the future.

-4-

SECTION VI

REPRESENTATIONS AND WARRANTIES OF Guarantor

Guarantor represents and warrants to Payee as
follows:

(a)  The execution,
delivery, and performance by Guarantor of this Guaranty do not and will not (i) conflict with or contravene any law, rule, regulation, judgment, order,
or decree of any government, governmental instrumentality, or court having jurisdiction over Guarantor or Guarantor’s activities or properties,
(ii) conflict with, or result in any default under, any agreement or instrument of any kind to which Guarantor is a party, or by which Guarantor, or
any of Guarantor’s properties, may be bound or affected, or (iii) require the consent, approval, order, authorization of, registration with, or
the giving of notice to any United States governmental authority or other governmental authority, or any person or entity not a party to the
Documents;

(b)  The execution,
delivery, and performance by Guarantor of this Guaranty have been duly authorized by all necessary corporate action of Guarantor, do not require any
shareholder approval, and do not contravene any provision of Guarantor’s articles of association or bylaws;

(c)  This Guaranty
constitutes the legal, valid, and binding obligation of Guarantor, enforceable against Guarantor in accordance with its terms, except as the
enforceability thereof may be limited by any applicable bankruptcy, reorganization, insolvency or other laws affecting creditors’ rights
generally, or by general principles of equity;

(d)  There is no
action, litigation, or other proceeding pending, or, to Guarantor’s knowledge, threatened against Guarantor before any court, arbitrator, or
administrative agency that may have a material adverse effect on the assets or the business or financial condition of Guarantor, or that would prevent,
hinder, or jeopardize the performance by Guarantor of Guarantor’s obligations under this Guaranty;

(e)  Guarantor is
familiar with all the covenants, terms, and conditions of the Agreement, the Note, and the other Documents; and

(f)  Guarantor is not
party to any contract, agreement, indenture, or instrument, or subject to any restrictions that individually or in the aggregate reasonably would be
expected to have a Material Adverse Effect, or that would in any material way jeopardize the ability of Guarantor to perform its obligations under this
Guaranty.

The foregoing representations and
warranties are ongoing in nature and shall remain in force and effect until Guarantor has satisfied fully (or has been relieved of) its obligations
under this Guaranty.

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SECTION VII

SUBORDINATION OF INDEBTEDNESS OF MAKER TO
GUARANTOR

Any indebtedness of Maker now or
hereafter owed to Guarantor hereby is subordinated to the indebtedness of Maker owed to Payee, including, but not limited to, the obligation of Maker
to pay interest and other amounts that would accrue and become due under or in respect of the Note or any other Document but for the filing by Maker
(or with respect to Maker) of a petition in bankruptcy, or the operation of the automatic stay under Section 362(a) of the Bankruptcy Code (11 USC
§ 362(a)) (including, without limitation, Maker’s obligations to pay principal and interest and all other charges, fees, expenses,
commissions, reimbursements, premiums, indemnities, and other payments related to or in respect of the Obligations contained in the Agreement). If
Payee so requests, any or all indebtedness of Maker to Guarantor shall be collected, enforced, and received by Guarantor as trustee for Payee and shall
be paid over to Payee on account of the Obligations, but without reducing or affecting in any manner the liability of Guarantor under the other
provisions of this Guaranty.

SECTION VIII

DURATION OF GUARANTY

This Guaranty will take effect on the date hereof without the
necessity of any acceptance by Payee or any notice to Guarantor or to Maker, and will continue in full force and effect until such time that all of the
Obligations shall have been fully and finally paid and satisfied. This Guaranty shall be reinstated automatically if any payment made in respect of the
Obligations is reclaimed in a bankruptcy or receivership case or proceeding, until Payee is paid the reclaimed amount by Guarantor or another party and
such amount is not subject to further reclamation.

SECTION IX

EVENTS OF DEFAULT; REMEDIES

9.1    Events of Default. The term “Event of Default,” whenever used in this Guaranty, means an Event of
Default under the Note or the Security Agreement.

9.2    Effect of an Event of Default. Upon the occurrence and during the continuance of any Event of Default, the
Obligations then, or at any time thereafter, at the option of Payee in accordance with the terms of the Note and the Security Agreement, immediately
shall become due and payable without notice or demand, and Payee shall have an immediate right to pursue the remedies provided in this
Guaranty.

9.3    Remedies. If an Event of Default occurs and is continuing, Payee shall have all rights and remedies provided
by law including, but not limited to, the right of Payee to commence an action against Guarantor to recover any amount owed by Guarantor to Payee
pursuant to the terms of this Guaranty. Guarantor hereby waives any notice of the occurrence of any Event of Default.

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SECTION X

GENERAL PROVISIONS

10.1    Benefits of Agreement. Guarantor agrees that (a) this Guaranty shall inure to the benefit of and may be
enforced by Payee (and Payee’s successors and assigns), and any subsequent holder of this Guaranty, the Note, and the other Documents, and (b)
this Guaranty shall be binding upon and enforceable against Guarantor and Guarantor’s successors and permitted assigns, if any.

10.2    Assignment. Guarantor agrees that no assignment of its obligations under this Guaranty may be made without
the prior, written consent of Payee at the time of such assignment (which consent may be withheld by Payee in Payee’s sole and absolute
discretion). Subject to the terms of the Security Agreement, Payee may assign any or all of Payee’s rights and interests in and under this
Guaranty, the Note, and the Security Agreement without the consent of Maker, Guarantor, or any other person or entity.

10.3    Governing Law. This Guaranty shall be construed according to the laws of the State of Delaware, without
giving effect to its principles of conflicts of law.

10.4    Entire Agreement; Merger. This Guaranty constitutes the entire understanding between Payee and Guarantor
with respect to Guarantor’s agreement to guarantee payment of the Obligations. No course of prior dealing between or among the parties, no usage
of trade, and no parol or extrinsic evidence of any nature shall be used to supplement or modify any terms of this Guaranty. There are no conditions to
the full effectiveness of this Guaranty. All prior and contemporaneous negotiations, understandings, and agreements between Guarantor and Payee with
respect to the subject matter hereof are merged in this Guaranty.

10.5    Invalid Provisions. If any provision of this Guaranty is invalid, illegal, or unenforceable, such provision
shall be considered severed from the rest of this Guaranty and the remaining provisions shall continue in full force and effect as if the invalid
provision had not been included. This Guaranty may be changed, modified, or supplemented only by means of a written agreement signed by Guarantor and
Payee at the time of such change, modification, or supplement.

10.6    Attorney Fees and Collection Expenses. If an Event of Default occurs, Payee shall be entitled to recover
from Guarantor, upon demand, any reasonable out-of-pocket costs and expenses incurred in connection with the preservation of rights under, and
enforcement of, this Guaranty and the other Documents, whether or not any lawsuit or arbitration proceeding is commenced, in all such cases including,
without limitation, reasonable attorney fees and costs. Costs and expenses as referred to above shall include, without limitation, a reasonable hourly
rate for collection personnel, whether employed in-house or otherwise, overhead costs as reasonably allocated to the collection effort, and all other
reasonable out-of-pocket expenses actually incurred. Reasonable attorneys’ fees and costs shall include, without limitation, reasonable
attorneys’ fees and costs incurred in connection with any bankruptcy case or other insolvency proceeding commenced by or against Maker, including
all reasonable fees incurred in connection with (a) moving for relief from the automatic stay, to convert or dismiss the case or proceeding, or to
appoint a trustee or examiner, or (b) proposing or opposing confirmation of a

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plan of reorganization or
liquidation, in any case without regard to the identity of the prevailing party.

10.7    Consent to Jurisdiction and Venue. Guarantor hereby (a) irrevocably submits to the jurisdiction and venue
of any state or federal court sitting in the State of Delaware, U.S.A., in any action or proceeding brought to enforce this Guaranty, or otherwise
arising out of or relating to this Guaranty; (b) irrevocably waives to the fullest extent permitted by law any objection that Guarantor now or
hereafter may have to the laying of venue in any such action or proceeding in any such forum; and (c) further irrevocably waives any claim that any
such forum is an inconvenient forum. Guarantor agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in
any other jurisdiction by suit on the judgment, or in any other manner provided by law. Nothing in this Guaranty shall impair the right of Payee to
bring any action or proceeding against Guarantor in any court of any other jurisdiction.

10.8    Waiver of Jury Trial. GUARANTOR HEREBY WAIVES ITS RIGHT TO TRIAL BY JURY OF ANY CLAIM IT HAS OR
HEREAFTER MAY HAVE AGAINST PAYEE (INCLUDING CROSS-CLAIMS AND COUNTERCLAIMS), INCLUDING, BUT NOT LIMITED TO, ANY CLAIM ARISING UNDER, IN CONNECTION
WITH, OR IN RELATION TO THIS GUARANTY.

10.9    Direct, Unconditional Obligation. GUARANTOR UNDERSTANDS THAT PAYEE DOES NOT HAVE TO PURSUE MAKER OR
PURSUE ANY OTHER REMEDIES BEFORE DEMANDING PAYMENT FROM GUARANTOR. GUARANTOR FURTHER UNDERSTANDS THAT IT WILL HAVE TO PAY AMOUNTS DUE FROM VESTA EVEN
IF MAKER OR ANY OTHER GUARANTOR OF THE OBLIGATIONS DOES NOT MAKE THE PAYMENTS OR OTHERWISE IS RELIEVED OF THE OBLIGATION TO MAKE
PAYMENTS.

PLANT HEALTH CARE plc
(“Guarantor”)

By
Name:
Title:

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Exhibit D

Security Agreement

FORM OF
 SECURITY AGREEMENT AND PATENT AND
TRADEMARK
 SECURITY AGREEMENT

This Security Agreement and Patent and
Trademark Security Agreement (the “Security Agreement”) is entered into as of , 200 , between PLANT HEALTH CARE, INC., a Pennsylvania
corporation (“Debtor”) and EDEN BIOSCIENCE CORPORATION, a Washington corporation (“Secured Party”).

RECITALS

A.    Pursuant to
the terms of an Asset Purchase Agreement dated ________ __, 2006 (the “Agreement”) between Debtor and Secured Party, Secured Party is
accepting from Debtor a Secured Promissory Note in the original principal amount of $1,000,000 (the “Note”) as a portion of the consideration
paid pursuant to the Agreement. The Note, the Guaranty, this Security Agreement, and the Agreement, along with all amendments and modifications
thereto, and all instruments delivered in connection therewith, are referred to as the “Documents.” Capitalized terms used in this Security
Agreement that are not defined herein have the meanings assigned to those terms in the Agreement.

B.    One of the
conditions precedent to the agreement of Secured Party to close the transactions contemplated by the Agreement is that Debtor execute this Security
Agreement and thereby grant Secured Party a first priority security interest in certain personal property of Debtor acquired from Secured Party
pursuant to the Agreement and described in paragraph 1 of this Security Agreement.

NOW, THEREFORE, for valuable
consideration, the receipt and sufficiency of which hereby are acknowledged, Debtor and Secured Party agree as follows:

AGREEMENT

1.    Security
Agreement. Debtor hereby grants to Secured Party, on behalf of Secured Party, a security interest in the Collateral to secure the Obligations (as
defined in the Guaranty) and agrees that Secured Party shall have the rights stated in this Security Agreement with respect to the Collateral, in
addition to all other rights that Secured Party may have under applicable law and the other Documents. As used herein, the term “Collateral”
means the following described property of Debtor, whether now owned or hereafter acquired, whether now existing or hereafter arising, and wherever
located:

all of the “Equipment”
and “Assigned Intellectual Property” as defined in the Agreement and all present and future right, title and interest of Debtor in and to
that Exclusive License Agreement, dated as of May 1, 1995, between Secured Party and Cornell Research Foundation, as the same may be amended, modified,
and the like from time to time (the “License”), solely to the extent permitted under such License, along with all proceeds (including
insurance proceeds) of the same. In addition, the word “Collateral” includes all records and data relating to any of the property described
above, whether in the form of a writing, photograph, microfilm, microfiche, or electronic media, together with all of Debtor’s right, title, and
interest in and to all computer software required to utilize, create, maintain, and process any such records or data on electronic
media.

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2.    Representations and Warranties. Debtor represents and warrants to Secured Party as follows:

(a)    The
execution, delivery, and performance by Debtor of this Security Agreement do not and will not (i) conflict with or contravene any law, rule,
regulation, judgment, order, or decree of any government, governmental instrumentality, or court having jurisdiction over Debtor or Debtor’s
activities or properties, (ii) conflict with, or result in any default under, any agreement or instrument of any kind to which Debtor is a party, or by
which Debtor, or any of Debtor’s properties, may be bound or affected (other than this Security Agreement), or (iii) require the consent,
approval, order, authorization of, registration with, or the giving of notice to any United States governmental authority or other governmental
authority, or any person or entity not a party to the Documents;

(b)    The
execution, delivery, and performance by Debtor of this Security Agreement has been duly authorized by all necessary corporate action of Debtor, do not
require any shareholder approval, and do not contravene any provision of Debtor’s articles of incorporation or bylaws;

(c)    This
Security Agreement constitutes the legal, valid, and binding obligation of Debtor, enforceable against Debtor in accordance with its terms, except as
the enforceability thereof may be limited by any applicable bankruptcy, reorganization, insolvency or other laws affecting creditors’ rights
generally or by general principles of equity;

(d)    There
is no action, litigation, or other proceeding pending, or, to Debtor’s knowledge, threatened against Debtor before any court, arbitrator, or
administrative agency that may have a material adverse effect on the assets or the business or financial condition of Debtor, or that would prevent,
hinder, or jeopardize the performance by Debtor of Debtor’s obligations under this Security Agreement, except for such actions disclosed on the
Secured Parties Schedules to the Agreement;

(e)    Debtor
is familiar with all the covenants, terms, and conditions of the Agreement, the Note and the Guaranty; and

(f)    Debtor
is not party to any contract, agreement, indenture, or instrument, or subject to any restriction individually or in the aggregate that is reasonably
likely to have a material adverse effect on Debtor’s financial condition or business, or that would in any way jeopardize the ability of Debtor to
perform Debtor’s obligations under this Security Agreement.

The foregoing representations and warranties are on-going
in nature and shall remain in force and effect until Debtor has satisfied fully (or has been relieved of) Debtor’s obligations under this Security
Agreement.

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3.    Perfection of Secured Party’s Security Interest. Debtor agrees to execute such financing statements and
to take whatever other reasonable actions are requested by Secured Party to perfect and continue Secured Party’s first lien security interest in
the Collateral. Debtor hereby appoints Secured Party as its irrevocable attorney-in-fact for the purpose of executing any documents necessary to
perfect or to continue the security interest granted in this Security Agreement. In addition, Debtor hereby authorizes Secured Party at any time, and
without further authorization from Debtor, to file a financing statement with respect to Debtor and the Collateral and to take such other lawful
actions reasonably deemed necessary or desirable by Secured Party to perfect, or continue the perfection of, its security interest in the Collateral.
Debtor will reimburse Secured Party for all expenses, up to $2,500, reasonably incurred in connection with the perfection and the continuation of the
perfection of Secured Party’s security interest in the Collateral. This is a continuing Security Agreement and will continue in effect until all
of the Obligations are indefeasibly satisfied in full.

4.    Patent and Trademark Filings. Secured Party is hereby authorized to file this Agreement, or a summary
thereof, with the U.S. Patent and Trademark Office in order to evidence Secured Party’s rights in any Assigned Intellectual Property . Debtor
hereby appoints Secured Party as its attorney-in-fact to execute, and agrees upon request to execute, such other and further documents as Secured Party
may reasonably deem necessary in order to evidence such rights, including execution of summaries thereof by Secured Party in the name of
Debtor.

5.    Transactions Involving Collateral. Except for accounts collected in the ordinary course of Debtor’s
business or the disposition of assets, including used equipment, in the ordinary course of Debtor’s business, Debtor shall not sell, offer to
sell, or otherwise transfer or dispose of the Collateral in any manner not permitted by the Agreement. Debtor shall not pledge, mortgage, encumber, or
otherwise permit the Collateral to be subject to any lien, security interest, encumbrance, or charge, other than the security interest provided for in
this Security Agreement, without the prior written consent of Secured Party.

Notwithstanding the foregoing,
Debtor may sell items of Equipment from time to time without Secured Party’s consent, subject to Debtor’s obligation to prepay the Note as
set forth therein.

6.    Termination of Security Interest. At such time as all payment obligations under the Note have been satisfied
in full, Secured Party shall execute and deliver to Debtor all deeds, assignments, termination statements and other instruments and to take such other
actions as may be necessary or reasonably requested by Debtor to re-vest in Debtor full title to the Collateral, and Debtor hereby appoints Secured
Party as its irrevocable attorney-in-fact from and after such time for the purpose of executing any such documents necessary to terminate the security
interest granted herein.

7.    Title. Debtor shall defend the rights of Secured Party in the Collateral against the claims and demands of
all other persons.

8.    Maintenance and Inspection of Collateral. Debtor shall maintain all tangible Collateral in substantially the
same condition and repair (reasonable wear and tear excepted) as it was in when acquired from Secured Party pursuant to the Agreement. Debtor will not
commit or

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permit damage to or
destruction of any material part of the Collateral. Secured Party, and its designated representatives and agents, shall have the right to examine,
inspect, and audit the Collateral wherever located in accordance with the Agreement. Debtor shall prosecute to completion all pending applications for
intellectual property protection of the Assigned Intellectual Property, shall maintain in full force and effect all current registrations thereof, and
shall protect and defend against all competing applications or registrations of intellectual property that may conflict therewith; provided that
nothing herein shall require Debtor to prosecute or maintain any such applications in connection with Assigned Intellectual Property for which
Debtor’s board of directors has determined in good faith that the loss or abandonment of such portion of the Assigned Intellectual Property would
not have a material adverse effect on the value of the Collateral in the aggregate or on the ability of Debtor to perform Debtor’s obligations
under this Security Agreement.

9.    Compliance With Governmental Requirements. Debtor shall comply promptly in all material respects with all
laws, ordinances, and regulations of all governmental authorities applicable to the production, disposition, or use of the Collateral, unless the
failure to do so reasonably would not be expected to have a Material Adverse Effect. Debtor may contest in good faith any such law, ordinance, or
regulation and withhold compliance during any proceeding, including appropriate appeals, so long as Secured Party’s interest in the Collateral, in
Secured Party’s reasonable opinion, is not materially jeopardized.

10.    Maintenance of Casualty Insurance. Debtor shall procure and maintain all risks insurance, including without
limitation fire, theft, and liability coverage together with such other insurance as is customary in the industry with respect to the Collateral, in
form, amounts, coverages, and basis as is customary in the industry and issued by a company or companies reasonably acceptable to Secured Party.
Debtor, upon request of Secured Party, will deliver to Secured Party from time to time the policies or certificates of insurance in form reasonably
satisfactory to Secured Party. Debtor also will make reasonable efforts to obtain stipulations that coverages will not be cancelled or diminished
without at least ten days prior written notice to Secured Party and not including any disclaimer of the insurer’s liability for failure to give
such a notice. In connection with all policies covering assets in which Secured Party holds a security interest, Debtor will provide Secured Party with
such loss payable or other endorsements as Secured Party reasonably may require. If Debtor at any time fails to obtain or maintain any insurance as
required under this Security Agreement, Secured Party may (but shall not be obligated to), after 30 days’ notice to Debtor, obtain such insurance
as Secured Party deems appropriate, including if it so chooses “single interest insurance,” which will cover only Secured Party’s
interest in the Collateral. Unless Debtor provides Secured Party with evidence of the insurance coverage as required herein, Secured Party may purchase
insurance at Debtor’s expense to protect Secured Party’s interest. This insurance may, but need not, also protect Debtor’s interest.
Debtor is responsible for the cost of any insurance purchased by Secured Party. The cost of this insurance may be added to the indebtedness secured
hereunder.

11.    Application of Insurance Proceeds. Debtor promptly shall notify Secured Party of any loss or damage to any
material portion of the Collateral. Secured Party may make proof of loss if Debtor fails to do so within 15 days of the casualty. All proceeds of any
insurance on the Collateral, including accrued proceeds thereon, shall be part of the Collateral.

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12.    Insurance Reports. Not more frequently than quarterly, upon the request of Secured Party, Debtor shall
furnish to Secured Party reports on each existing policy of insurance covering any of the Collateral showing such information as Secured Party
reasonably may request including the following: (a) the name of the insurer; (b) the risks insured; (c) the amount of the policy; (d) the property
insured; (e) the then current value on the basis of which insurance has been obtained and the manner of determining that value; and (f) the expiration
date of the policy.

13.    Debtor’s Right to Possession. Until the occurrence of an Event of Default, Debtor shall have possession
of the tangible personal property and beneficial use of all the Collateral and may use it in any lawful manner not inconsistent with this Security
Agreement or the other Documents, provided that Debtor’s right to possession and beneficial use shall not apply to any Collateral where possession
of the Collateral by Secured Party is required by law to perfect Secured Party’s security interest in such Collateral. If Secured Party at any
time has possession of any Collateral, whether before or after an Event of Default, Secured Party shall exercise such reasonable care in the custody
and preservation of the Collateral as Debtor shall request or as Secured Party would afford to its own property, but failure to honor any request by
Debtor shall not of itself be deemed to be a failure to exercise reasonable care. Secured Party shall not be required to take any steps necessary to
preserve any rights in the Collateral against prior secured parties, or to protect, preserve, or maintain any security interest given to secure the
Collateral.

14.    Expenditures by Secured Party. If not discharged or paid when due, Secured Party may (but shall not be
obligated to), after prior written notice to Debtor, discharge or pay any amounts required to be discharged or paid by Debtor under this Security
Agreement, including without limitation all taxes, liens, security interests, encumbrances, and other claims at any time levied or placed on the
Collateral. Secured Party also may (but shall not be obligated to) pay all costs for insuring, maintaining, and preserving the Collateral in accordance
with the terms of this Security Agreement. All such expenditures incurred or paid by Secured Party for such purposes then will bear interest at the
Default Rate from the date incurred or paid by Secured Party to the date of repayment by Debtor. All such expenses shall become a part of the
Obligations and, at Secured Party’s option, will (a) be payable on demand, (b) be added to the balance of the Agreement and be apportioned among
and be payable with any installment payments to become due during either (i) the term of any applicable insurance policy or (ii) the remaining term of
the Agreement, or (c) be treated as a balloon payment that will be due and payable at the Agreement’s maturity. This Security Agreement also will
secure payment of these amounts. Such right shall be in addition to all other rights and remedies to which Secured Party may be entitled upon the
occurrence of an Event of Default.

15.    Events of Default. Each of the following shall constitute an Event of Default under this Security
Agreement:

(a)    The
occurrence of an Event of Default under the Note;

(b)    Any
warranty, representation, or statement made or furnished to Secured Party by or on behalf of Debtor under this Security Agreement is false or
misleading in any material respect, either now or at the time made or furnished; and

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(c)    This
Security Agreement, the Note or the Guaranty ceases to be in full force and effect (including the failure of any document by its terms to create a
valid and perfected first priority security interest or lien in all or any portion of the Collateral) at any time and for any reason.

16.    Rights and Remedies on Default. If an Event of Default occurs under this Security Agreement, at any time
thereafter, Secured Party shall have all the rights of a secured party under the Delaware Uniform Commercial Code. In addition and without limitation,
Secured Party may exercise any one or more of the following rights and remedies:

(a)    Secured Party may declare the entire Obligations, including any prepayment charge that Debtor would be required to
pay, immediately due and payable, following written notice to Debtor;

(b)    Secured Party may require Debtor to deliver to Secured Party all or any portion of the Collateral and any and all
certificates of title and other documents relating to the Collateral. Secured Party may require Debtor to assemble the Collateral and make it available
to Secured Party at a place to be designated by Secured Party. Secured Party also shall have full power to enter upon the property of Debtor to take
possession of and remove the Collateral. If the Collateral contains other goods not covered by this Security Agreement at the time of repossession,
Debtor agrees that Secured Party may take such other goods, provided that Secured Party makes reasonable efforts to return them to Debtor after
repossession;

(c)    Secured Party shall have full power to sell, lease, transfer, or otherwise deal with the Collateral or proceeds
thereof in its own name or that of Debtor. Secured Party may sell the Collateral at public auction or private sale. Unless the Collateral threatens to
decline speedily in value or is of a type customarily sold on a recognized market, Secured Party will give Debtor reasonable notice of the time after
which any private sale or any other intended disposition of the Collateral is to be made unless Debtor has signed, after an Event of Default occurs, a
statement renouncing or modifying Debtor’s right to notification of sale. The requirements of reasonable notice shall be met if such notice is
given at least ten days before the time of the sale or disposition. All expenses relating to the disposition of the Collateral, including, without
limitation, the expenses of retaking, holding, insuring, preparing for sale and selling the Collateral, shall become a part of the Obligations secured
by this Security Agreement and shall be payable on demand, with interest at the rate applicable to Prime Rate Loans from the date of expenditure until
repaid;

(d)    To the
extent permitted by applicable law, Secured Party shall have the following rights and remedies regarding the appointment of a receiver: (i) Secured
Party may have a receiver appointed as a matter of right, (ii) the receiver may be an employee of Secured Party and may serve without bond, and (iii)
all fees of the receiver and his or her attorney shall become part of the Obligations secured by this Security Agreement and shall be payable on
demand, with interest as set forth in the Note (including default interest), until repaid;

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(e)    Secured Party, either itself or through a receiver, may collect the payments, rents, income, and revenues from the
Collateral. Secured Party at any time in its discretion may transfer any Collateral into its own name or that of its nominee and receive the payments,
rents, income, and revenues therefrom and hold the same as security for the Obligations or apply it to payment of the Obligations in such order of
preference as Secured Party may determine. Insofar as the Collateral consists of accounts, general intangibles, insurance policies, instruments,
chattel paper, chooses in action, or similar property, Secured Party may demand, collect, receipt for, settle, compromise, adjust, sue for, foreclose,
or realize on the Collateral as Secured Party may determine. For these purposes, Secured Party may, on behalf of and in the name of Debtor, receive,
open, and dispose of mail addressed to Debtor; change any address to which mail and payments are to be sent; and endorse notes, checks, drafts, money
orders, documents of title, instruments, and items pertaining to payment, shipment, or storage of any Collateral. To facilitate collection, Secured
Party may notify account debtors and obligors on any Collateral to make payments directly to Secured Party;

(f)    If
Secured Party chooses to sell any or all of the Collateral and except as otherwise set forth in the Note, Secured Party may obtain a judgment against
Debtor for any deficiency remaining on the Obligations due to Secured Party after application of all amounts received from the exercise of the rights
provided in this Security Agreement. Debtor shall be liable for a deficiency even if the transaction described in this subsection is a sale of accounts
or chattel paper;

(g)    Except
as may be expressly set forth to the contrary in this Security Agreement, Secured Party shall have all the rights and remedies of a secured creditor
under the provisions of the Uniform Commercial Code, as may be amended from time to time. In addition, Secured Party shall have and may exercise any or
all other rights and remedies it may have available at law, in equity, or otherwise; and

(h)    All of
Secured Party’s rights and remedies, whether evidenced by this Security Agreement or the other Documents or by any other writing, shall be
cumulative and may be exercised singularly or concurrently. Election by Secured Party to pursue any remedy shall not exclude pursuit of any other
remedy, and an election to make expenditures or to take action to perform an obligation of Debtor under this Security Agreement, after Debtor’s
failure to perform, shall not affect Secured Party’s right to declare a default and to exercise its remedies.

17.    Amendments and Waivers. No term, provision, or condition of this Security Agreement may be amended, waived,
discharged, or terminated, except by a written instrument signed by Secured Party and, in the case of amendments, by Debtor.

18.    Entire Agreement. This Security Agreement and the other Documents set forth and constitute the entire
agreement between Secured Party and Debtor with respect to the Obligations and the Collateral. No oral promise or agreement of any kind or nature,
other than those that have been reduced to writing and have been set forth in this Security Agreement and in the other Documents, has been made between
Secured Party and Debtor with respect to the Obligations or the Collateral.

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19.    Applicable Law. This Security Agreement shall be governed by and construed in accordance with the laws of
the State of Delaware, without reference to its choice of law principles.

20.    Expenses. Debtor agrees to pay upon demand all of Secured Party’s reasonable costs and expenses,
including attorneys’ fees, incurred in connection with the enforcement of this Security Agreement, subject to the second to the last sentence of
Section 3 of this Security Agreement. Secured Party may pay someone else to help enforce this Security Agreement, and Debtor shall pay the costs and
expenses of such enforcement. Costs and expenses include Secured Party’s reasonable attorneys’ fees and legal expenses whether or not there
is a lawsuit, including attorneys’ fees and legal expenses for bankruptcy proceedings (and including efforts to modify or vacate any automatic
stay or injunction), appeals, and any anticipated post-judgment collection services. Debtor also shall pay all court costs and such additional fees as
may be directed by the court.

21.    Jurisdiction. Debtor hereby irrevocably submits to the venue and jurisdiction of any state or federal court
sitting in the State of Delaware, in any action or proceeding brought to enforce or otherwise arising out of or relating to this Security Agreement.
Debtor irrevocably waives to the fullest extent permitted by law any objection that Debtor now or hereafter may have to the laying of venue in any such
action or proceeding in any such forum, and hereby further irrevocably waives any claim that any such forum is an inconvenient forum. Debtor agrees
that a final judgment in any such action or proceeding may be enforced in any other jurisdiction by suit on the judgment, or in any other manner
provided by law. Nothing in this paragraph 21 of this Security Agreement shall impair the right of Secured Party to bring any action or proceeding
hereunder in the courts of any other jurisdiction. In that regard, Debtor irrevocably submits to the nonexclusive jurisdiction of the appropriate
courts of the jurisdiction in which Debtor is organized, or sitting in any place where property or an office of Debtor is located.

22.    Caption Headings. Caption headings in this Security Agreement are for convenience purposes only and are not
to be used to interpret or define the provisions of this Security Agreement.

23.    Notices. All notices required to be given under this Security Agreement shall be given in the manner
specified in the Agreement.

24.    Power of Attorney. Effective only during the continuance of an Event of Default, Debtor hereby appoints
Secured Party as its true and lawful attorney-in-fact, irrevocably, with full power of substitution to do the following: (a) to demand, collect,
receive, receipt for, sue and recover all sums of money or other property which may now or hereafter become due, owing or payable from the Collateral;
(b) to execute, sign and endorse any and all claims, Instruments, receipts, checks, drafts or warrants issued in payment for the Collateral; (c) to
settle or compromise any and all claims arising under the Collateral, and, in the place and stead of Debtor, to execute and deliver its release and
settlement for the claim; and (d) to file any claim or claims or to take any action or institute or take part in any proceedings, either in its own
name or in the name of Debtor, or otherwise, which in the discretion of Secured Party may seem to be necessary or advisable. This power is given as
security for the Obligations, and the authority

-8-

hereby conferred is and shall
be irrevocable and shall remain in full force and effect until renounced by Secured Party.

25.    Severability. If a court of competent jurisdiction finds any provision of this Security Agreement to be
invalid or unenforceable as to any person or circumstance, such finding shall not render that provision invalid or unenforceable as to any other
persons or circumstances. If feasible, any such offending provision shall be deemed to be modified to be within the limits of enforceability or
validity. However, if the offending provision cannot be so modified, it shall be stricken and all other provisions of this Security Agreement in all
other respects shall remain valid and enforceable.

26.    Successor Interests. Subject to the limitations set forth above on transfer of the Collateral, this Security
Agreement shall be binding upon and inure to the benefit of the parties, and their successors and assigns.

27.    Waiver. Secured Party shall not be deemed to have waived any rights under this Security Agreement unless
such waiver is given in writing and signed by Secured Party. No delay or omission on the part of Secured Party in exercising any right shall operate as
a waiver of such right or any other right. A waiver by Secured Party of a provision of this Security Agreement shall not prejudice or constitute a
waiver of Secured Party’s right otherwise to demand strict compliance with that provision or any other provision of this Security Agreement. No
prior waiver by Secured Party, nor any course of dealing between Secured Party and Debtor, shall constitute a waiver of any of Secured Party’s
rights, or of any of Debtor’s obligations, as to any future transactions. Whenever the consent of Secured Party is required under this Security
Agreement, the granting of such consent by Secured Party in any instance shall not constitute continuing consent to subsequent instances where such
consent is required and in all cases such consent may be granted or withheld in the sole discretion of Secured Party.

28.    Statutory Notice. ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR FORBEAR FROM
ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW (IF AND TO THE EXTENT APPLICABLE).

	PLANT HEALTH
CARE, INC. (“Debtor”)

	   	   	   	EDEN BIOSCIENCE CORPORATION
 (“Secured Party”)

	 
	By 

	   	   	   	By 

	Name:
	   	   	   	Name:

	Title:
	   	   	   	Title:

 

-9-Exhibit 10.1

================================================================================

                                CREDIT AGREEMENT

                                  by and among

                             ORION HEALTHCORP, INC.

                                       and

              EACH OF ITS SUBSIDIARIES THAT ARE SIGNATORIES HERETO

                                  as Borrowers,

                     THE LENDERS THAT ARE SIGNATORIES HERETO

                                 as the Lenders,

                                       and

                           WELLS FARGO FOOTHILL, INC.

                    as the Arranger and Administrative Agent

                          Dated as of December 1, 2006

================================================================================

<PAGE>

                                CREDIT AGREEMENT

                  THIS CREDIT AGREEMENT (this "Agreement"), is entered into as
of December 1, 2006, by and among the lenders identified on the signature pages
hereof (such lenders, together with their respective successors and permitted
assigns, are referred to hereinafter each individually as a "Lender" and
collectively as the "Lenders"), WELLS FARGO FOOTHILL, INC., a California
corporation, as the arranger and administrative agent for the Lenders (in such
capacity, together with its successors and assigns in such capacity, "Agent"),
Orion HealthCorp, Inc., a Delaware corporation ("Parent"), and each of Parent's
Subsidiaries identified on the signature pages hereof (such Subsidiaries,
together with Parent, are referred to hereinafter each individually as a
"Borrower", and individually and collectively, jointly and severally, as the
"Borrowers").

                  The parties agree as follows:

1.       DEFINITIONS AND CONSTRUCTION.

         1.1 Definitions. Capitalized terms used in this Agreement shall have
the meanings specified therefor on Schedule 1.1.

         1.2 Accounting Terms. All accounting terms not specifically defined
herein shall construed in accordance with GAAP. When used herein, the term
"financial statements" shall include the notes and schedules thereto. Whenever
the term "Borrowers" or the term "Parent" is used in respect of a financial
covenant or a related definition, it shall be understood to mean Parent and its
Subsidiaries on a consolidated basis, unless the context clearly requires
otherwise.

         1.3 Code. Any terms used in this Agreement that are defined in the Code
shall be construed and defined as set forth in the Code unless otherwise defined
herein; provided, however, that to the extent that the Code is used to define
any term herein and such term is defined differently in different Articles of
the Code, the definition of such term contained in Article 9 of the Code shall
govern.

         1.4 Construction. Unless the context of this Agreement or any other
Loan Document clearly requires otherwise, references to the plural include the
singular, references to the singular include the plural, the terms "includes"
and "including" are not limiting, and the term "or" has, except where otherwise
indicated, the inclusive meaning represented by the phrase "and/or." The words
"hereof," "herein," "hereby," "hereunder," and similar terms in this Agreement
or any other Loan Document refer to this Agreement or such other Loan Document,
as the case may be, as a whole and not to any particular provision of this
Agreement or such other Loan Document, as the case may be. Section, subsection,
clause, schedule, and exhibit references herein are to this Agreement unless
otherwise specified. Any reference herein or in any other Loan Document to the
satisfaction or repayment in full of the Obligations shall mean the repayment in
full in cash (or cash collateralization in accordance with the terms hereof) of
all Obligations other than contingent indemnification Obligations for which no
claim has been threatened or asserted or can be reasonably identified based on
the then-known facts and circumstances and other than any Bank Product
Obligations that, at such time, are allowed by the applicable Bank Product
Provider to remain outstanding and are not required to be repaid or cash
collateralized pursuant to the provisions of this Agreement. Any reference in
this Agreement or in any other Loan Document to any agreement, instrument, or
document shall include all alterations, amendments, changes, extensions,
modifications, renewals, replacements, substitutions, joinders, and supplements,
thereto and thereof, as applicable (subject to any restrictions on such
alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements set forth herein). Any
reference herein to any Person shall be construed to include such Person's
successors and assigns. Any requirement of a writing contained herein or in any
other Loan Document shall be satisfied by the transmission of a Record and any
Record so transmitted shall constitute a representation and warranty as to the
accuracy and completeness of the information contained therein.

                                       1
<PAGE>

         1.5 Schedules and Exhibits. All of the schedules and exhibits attached
to this Agreement shall be deemed incorporated herein by reference.

2. LOAN AND TERMS OF PAYMENT.

         2.1      Revolver Advances.

                (a) Subject to the terms and conditions of this Agreement, and
during the term of this Agreement, each Lender with a Revolver Commitment agrees
(severally, not jointly or jointly and severally) to make advances ("Advances")
to Borrowers exclusively for Borrowers' working capital needs (excluding,
however any use in connection with any acquisition, whether or not constituting
a Permitted Acquisition) in an amount at any one time outstanding not to exceed
such Lender's Pro Rata Share of an amount equal to the lesser of (i) the Maximum
Revolver Amount less the Letter of Credit Usage at such time, and (ii) the
Borrowing Base at such time less the Letter of Credit Usage at such time.

                (b) Anything to the contrary in this Section 2.1
notwithstanding, Agent shall have the right to establish reserves against the
Borrowing Base in such amounts, and with respect to such matters, as Agent in
its Permitted Discretion shall deem necessary or appropriate, including reserves
with respect to (i) sums that Borrowers or their Subsidiaries are required to
pay under any Section of this Agreement or any other Loan Document (such as
taxes, assessments, insurance premiums, or, in the case of leased assets, rents
or other amounts payable under such leases) and have failed to pay, and (ii)
amounts owing by Borrowers or their Subsidiaries to any Person to the extent
secured by a Lien on, or trust over, any of the Collateral (other than a
Permitted Lien), which Lien or trust, in the Permitted Discretion of Agent
likely would have a priority superior to the Agent's Liens (such as Liens or
trusts in favor of landlords, warehousemen, carriers, mechanics, materialmen,
laborers, or suppliers, or Liens or trusts for ad valorem, excise, sales, or
other taxes where given priority under applicable law) in and to such item of
the Collateral.

                (c) Amounts borrowed pursuant to this Section 2.1 may be repaid
and, subject to the terms and conditions of this Agreement, reborrowed at any
time during the term of this Agreement. The outstanding principal amount of the
Advances, together with interest accrued thereon, shall be due and payable on
the Maturity Date or, if earlier, on the date on which they are declared due and
payable pursuant to the terms of this Agreement.

         2.2      Term Loans.

                (a) Subject to the terms and conditions of this Agreement, on
the Closing Date each Lender with a Term Loan A Commitment agrees (severally,
not jointly or jointly and severally) to make term loans (collectively, the
"Term Loan A") to Borrowers in an amount equal to such Lender's Pro Rata Share
of the Term Loan A Amount. The principal of the Term Loan A shall be repaid in
monthly installments on the first day of each calendar month as set forth below:

================================================================================
               Period                                 Installment Amount
--------------------------------------------------------------------------------
    From January 1, 2007, through                          $26,250
          December 31, 2007
--------------------------------------------------------------------------------
    From January 1, 2008, through                          $37,500
          December 31, 2008
--------------------------------------------------------------------------------
    From January 1, 2009, through                          $56,250
          December 31, 2009
--------------------------------------------------------------------------------
 From January 1, 2010, until paid in                       $75,000
                full
================================================================================

                                       2
<PAGE>

Notwithstanding the foregoing, the outstanding unpaid principal balance and all
accrued and unpaid interest on the Term Loan A shall be due and payable on the
earliest of (i) the Maturity Date, (ii) the date of the acceleration of Term
Loan A in accordance with the terms hereof, and (iii) the date of termination of
this Agreement pursuant to Section 8.1(c).

                (b) Subject to the terms and conditions of this Agreement,
including the conditions precedent set forth in Section 3, each Lender with a
Term Loan B Commitment (severally, not jointly or jointly and severally) commits
to make term loans (collectively, the "Term Loan B") to Borrowers on and after
the date Borrowers deliver to Agent financial statements (without footnotes and
schedules for the fourth fiscal quarter) for the fiscal quarter ending December
31, 2006 through and including June 1, 2009, for the exclusive purpose of any
Borrower making one or more Permitted Acquisitions in an aggregate amount equal
to such Lender's Pro Rata Share of the Term Loan B Amount; provided that the
aggregate original principal amount of all loans under Term Loan B shall not
exceed the Term Loan B Amount. The outstanding principal of the Term Loan B
shall be repaid in monthly installments on the first day of each calendar month
as set forth below:

================================================================================
               Period                                 Installment Amount
================================================================================
    From January 1, 2007, through                  0.584% multiplied by the
          December 31, 2007                   Aggregate Term Loan B Draw Amount
--------------------------------------------------------------------------------
    From January 1, 2008, through                  0.834% multiplied by the
          December 31, 2008                   Aggregate Term Loan B Draw Amount
--------------------------------------------------------------------------------
    From January 1, 2009, through                  1.250% multiplied by the
          December 31, 2009                   Aggregate Term Loan B Draw Amount
--------------------------------------------------------------------------------
 From January 1, 2010, until paid in               1.667% multiplied by the
                full                          Aggregate Term Loan B Draw Amount
================================================================================

Notwithstanding the foregoing, the outstanding unpaid principal balance and all
accrued and unpaid interest on the Term Loan B shall be due and payable on the
earliest of (i) the Maturity Date, (ii) the date of the acceleration of Term
Loan B in accordance with the terms hereof, and (iii) the date of termination of
this Agreement pursuant to Section 8.1(c). Term Loan A and Term Loan B shall
hereinafter be referred to collectively as the "Term Loans"). All principal of,
interest on, and other amounts payable in respect of the Term Loans shall
constitute Obligations. No amounts paid or prepaid in respect of the outstanding
principal amount of the Term Loans may be reborrowed.

         2.3      Borrowing Procedures and Settlements.

                (a) Procedure for Borrowing. Each Borrowing shall be made by an
irrevocable written request by an Authorized Person delivered to Agent. Unless
Swing Lender is not obligated to make a Swing Loan pursuant to Section 2.3(b)
below, such notice must be received by Agent no later than 10:00 a.m.
(California time) on the Business Day that is the requested Funding Date
specifying (i) the amount of such Borrowing, which in the case of a draw under
Term Loan B must be an amount not less than $1,000,000, (ii) the requested
Funding Date, which shall be a Business Day, and (iii) in the case of a draw
under Term Loan B, demonstrating compliance with the conditions precedent set
forth in Section 3.2; provided, however, that if Swing Lender is not obligated
to make a Swing Loan as to a requested Borrowing, such notice must be received
by Agent no later than 10:00 a.m. (California time) on the Business Day prior to
the date that is the requested Funding Date. At Agent's election, in lieu of
delivering the above-described written request, any Authorized Person may give
Agent telephonic notice of such request by the required time. In such
circumstances, Borrowers agree that any such telephonic notice will be confirmed
in writing within 24 hours of the giving of such telephonic notice, but the
failure to provide such written confirmation shall not affect the validity of
the request.

                                       3
<PAGE>

                (b) Making of Swing Loans. In the case of a request for an
Advance and so long as either (i) the aggregate amount of Swing Loans made since
the last Settlement Date plus the amount of the requested Advance does not
exceed $2,000,000, or (ii) Swing Lender, in its sole discretion, shall agree to
make a Swing Loan notwithstanding the foregoing limitation, Swing Lender shall
make an Advance in the amount of such Borrowing (any such Advance made solely by
Swing Lender pursuant to this Section 2.3(b) being referred to as a "Swing Loan"
and such Advances being referred to collectively as "Swing Loans") available to
Borrowers on the Funding Date applicable thereto by transferring immediately
available funds to Borrowers' Designated Account. Each Swing Loan shall be
deemed to be an Advance hereunder and (except as set forth in Section 2.3(a))
shall be subject to all the terms and conditions applicable to other Advances,
except that all payments on any Swing Loan shall be payable to Swing Lender
solely for its own account. Subject to the provisions of Section 2.3(d)(ii),
Swing Lender shall not make and shall not be obligated to make any Swing Loan if
Swing Lender has actual knowledge that (i) one or more of the applicable
conditions precedent set forth in Section 3 will not be satisfied on the
requested Funding Date for the applicable Borrowing, or (ii) the requested
Borrowing would exceed the Availability on such Funding Date. Swing Lender shall
not otherwise be required to determine whether the applicable conditions
precedent set forth in Section 3 have been satisfied on the Funding Date
applicable thereto prior to making any Swing Loan. The Swing Loans shall be
secured by the Agent's Liens, constitute Obligations hereunder, and bear
interest at the rate applicable from time to time to Advances that are Base
Rate Loans.

                (c) Making of Loans.

                        (i) In the event that Swing Lender is not obligated to
make a Swing Loan, then promptly after receipt of a request for a Borrowing
pursuant to Section 2.3(a), Agent shall notify the Lenders, not later than 1:00
p.m. (California time) on the Business Day immediately preceding the Funding
Date applicable thereto, by telecopy, telephone, or other similar form of
transmission, of the requested Borrowing. Each Lender shall make the amount of
such Lender's Pro Rata Share of the requested Borrowing available to Agent in
immediately available funds, to Agent's Account, not later than 10:00 a.m.
(California time) on the Funding Date applicable thereto. After Agent's receipt
of the proceeds of such Advances or Term Loan B, as the case may be, Agent shall
make the proceeds thereof available to Administrative Borrower on the applicable
Funding Date by transferring immediately available funds equal to such proceeds
received by Agent to Administrative Borrower's Designated Account; provided,
however, that, subject to the provisions of Section 2.3(d)(ii), Agent shall not
request any Lender to make, and no Lender shall have the obligation to make, any
Advance or Term Loan B, as the case may be, if Agent shall have actual knowledge
that (1) one or more of the applicable conditions precedent set forth in Section
3 will not be satisfied on the requested Funding Date for the applicable
Borrowing unless such condition has been waived, or (2) the requested Borrowing
would exceed the Availability on such Funding Date.

                        (ii) Unless Agent receives notice from a Lender prior to
9:00 a.m. (California time) on the date of a Borrowing, that such Lender will
not make available as and when required hereunder to Agent for the account of
Borrowers the amount of that Lender's Pro Rata Share of the Borrowing, Agent may
assume that each Lender has made or will make such amount available to Agent in
immediately available funds on the Funding Date and Agent may (but shall not be
so required), in reliance upon such assumption, make available to Borrowers on
such date a corresponding amount. If and to the extent any Lender shall not have
made its full amount available to Agent in immediately available funds and Agent
in such circumstances has made available to Borrowers such amount, that Lender
shall on the Business Day following such Funding Date make such amount available
to Agent, together with interest at the Defaulting Lender Rate for each day
during such period. A notice submitted by Agent to any Lender with respect to
amounts owing under this subsection shall be conclusive, absent manifest error.
If such amount is so made available, such payment to Agent shall constitute such
Lender's Advance or portion of Term Loan B, as the case may be, on the date of
Borrowing for all purposes of this Agreement. If such amount is not made
available to Agent on the Business Day following the Funding Date, Agent will
notify Administrative Borrower of such failure to fund and, upon demand by
Agent, Borrowers shall pay such amount to Agent for Agent's account, together
with interest thereon for each day elapsed since the date of such Borrowing, at
a rate per annum equal to the interest rate applicable at the time to the
Advances or Term Loan B, as the case may be, composing such Borrowing. The
failure of any Lender to make any Advance on any Funding Date shall not relieve
any other Lender of any obligation hereunder to make an Advance or fund its
portion of Term Loan B, as the case may be, on such Funding Date, but no Lender
shall be responsible for the failure of any other Lender to make the Advance or
fund its portion of Term Loan B, as the case may be, to be made by such other
Lender on any Funding Date.

                                       4
<PAGE>

                        (iii) Agent shall not be obligated to transfer to a
Defaulting Lender any payments made by Borrowers to Agent for the Defaulting
Lender's benefit, and, in the absence of such transfer to the Defaulting Lender,
Agent shall transfer any such payments to each other non-Defaulting Lender
member of the Lender Group ratably in accordance with their Commitments (but
only to the extent that such Defaulting Lender's Advance or Term Loan B, as the
case may be, was funded by the other members of the Lender Group) or, if so
directed by Administrative Borrower and if no Default or Event of Default had
occurred and is continuing (and to the extent such Defaulting Lender's Advance
or Term Loan B, as the case may be, was not funded by the Lender Group), retain
same to be re-advanced to Borrowers as if such Defaulting Lender had made
Advances or a draw under Term Loan B, as the case may be, to Borrowers. Subject
to the foregoing, Agent may hold and, in its Permitted Discretion, re-lend to
Borrowers for the account of such Defaulting Lender the amount of all such
payments received and retained by Agent for the account of such Defaulting
Lender. Solely for the purposes of voting or consenting to matters with respect
to the Loan Documents, such Defaulting Lender shall be deemed not to be a
"Lender" and such Lender's Commitment shall be deemed to be zero. This Section
shall remain effective with respect to such Lender until (x) the Obligations
under this Agreement shall have been declared or shall have become immediately
due and payable, (y) the non-Defaulting Lenders, Agent, and Administrative
Borrower shall have waived such Defaulting Lender's default in writing, or (z)
the Defaulting Lender makes its Pro Rata Share of the applicable Advance or Term
Loan B, as the case may be, and pays to Agent all amounts owing by Defaulting
Lender in respect thereof. The operation of this Section shall not be construed
to increase or otherwise affect the Commitment of any Lender, to relieve or
excuse the performance by such Defaulting Lender or any other Lender of its
duties and obligations hereunder, or to relieve or excuse the performance by
Borrowers of their duties and obligations hereunder to Agent or to the Lenders
other than such Defaulting Lender. Any such failure to fund by any Defaulting
Lender shall constitute a material breach by such Defaulting Lender of this
Agreement and shall entitle Administrative Borrower at its option, upon written
notice to Agent, to arrange for a substitute Lender to assume the Commitment of
such Defaulting Lender, such substitute Lender to be acceptable to Agent in its
Permitted Discretion. In connection with the arrangement of such a substitute
Lender, the Defaulting Lender shall have no right to refuse to be replaced
hereunder, and agrees to execute and deliver a completed form of Assignment and
Acceptance in favor of the substitute Lender (and agrees that it shall be deemed
to have executed and delivered such document if it fails to do so) subject only
to being repaid its share of the outstanding Obligations (other than Bank
Product Obligations, but including an assumption of its Pro Rata Share of the
Risk Participation Liability) without any premium or penalty of any kind
whatsoever; provided however, that any such assumption of the Commitment of such
Defaulting Lender shall not be deemed to constitute a waiver of any of the
Lender Groups' or Borrowers' rights or remedies against any such Defaulting
Lender arising out of or in relation to such failure to fund.

                (d) Protective Advances and Optional Overadvances.

                                (A)   Agent hereby is authorized by Borrowers
and the Lenders, from time to time in Agent's sole discretion, (A) after the
occurrence and during the continuance of a Default or an Event of Default, or
(B) at any time that any of the other applicable conditions precedent set forth
in Section 3 are not satisfied, to make Advances to Borrowers on behalf of the
Lenders that Agent, in its Permitted Discretion deems necessary or desirable
(1) to preserve or protect the Collateral, or any portion thereof, (2) to
enhance the likelihood of repayment of the Obligations (other than the Bank
Product Obligations), or (3) to pay any other amount chargeable to Borrowers
pursuant to the terms of this Agreement, including Lender Group Expenses and the
costs, fees, and expenses described in Section 9 (any of the Advances described
in this Section 2.3(d)(i) shall be referred to as "Protective Advances").

                                       5
<PAGE>

                                (B) Any contrary provision of this Agreement
notwithstanding,  the Lenders hereby authorize Agent or Swing Lender, as
applicable, and either Agent or Swing Lender, as applicable, may, but is not
obligated to, knowingly and intentionally, continue to make Advances (including
Swing Loans) to Borrowers notwithstanding that an Overadvance exists or thereby
would be created, so long as (A) after giving effect to such Advances, the
outstanding Revolver Usage does not exceed the Borrowing Base by more than
$1,000,000, and (B) after giving effect to such Advances, the outstanding
Revolver Usage (except for and excluding amounts charged to the Loan Account for
interest, fees, or Lender Group Expenses) does not exceed the Maximum Revolver
Amount. In the event Agent obtains actual knowledge that the Revolver Usage
exceeds the amounts permitted by the immediately foregoing provisions,
regardless of the amount of, or reason for, such excess, Agent shall notify the
Lenders as soon as practicable (and prior to making any (or any additional)
intentional Overadvances (except for and excluding amounts charged to the Loan
Account for interest, fees, or Lender Group Expenses) unless Agent determines
that prior notice would result in imminent harm to the Collateral or its value),
and the Lenders with Revolver Commitments thereupon shall, together with Agent,
jointly determine the terms of arrangements that shall be implemented with
Borrowers intended to reduce, within a reasonable time, the outstanding
principal amount of the Advances to Borrowers to an amount permitted by the
preceding paragraph. In such circumstances, if any Lender with a Revolver
Commitment objects to the proposed terms of reduction or repayment of any
Overadvance, the terms of reduction or repayment thereof shall be implemented
according to the determination of the Required Lenders. Each Lender with a
Revolver Commitment shall be obligated to settle with Agent as provided in
Section 2.3(e) for the amount of such Lender's Pro Rata Share of any
unintentional Overadvances by Agent reported to such Lender, any intentional
Overadvances made as permitted under this Section 2.3(d)(ii), and any
Overadvances resulting from the charging to the Loan Account of interest, fees,
or Lender Group Expenses.

                                (C) Each Protective  Advance and each
Overadvance  shall be deemed to be an Advance hereunder, except that no
Protective Advance or Overadvance shall be eligible to be a LIBOR Rate Loan and
all payments on the Protective Advances shall be payable to Agent solely for its
own account. The Protective Advances and Overadvances shall be repayable on
demand, secured by the Agent's Liens, constitute Obligations hereunder, and bear
interest at the rate applicable from time to time to Advances that are Base Rate
Loans. The provisions of this Section 2.3(d) are for the exclusive benefit of
Agent, Swing Lender, and the Lenders and are not intended to benefit any
Borrower in any way.

                (e) Settlement. It is agreed that each Lender's funded portion
of the Advances, Term Loan A and Term Loan B is intended by the Lenders to
equal, at all times, such Lender's Pro Rata Share of the outstanding Advances,
Term Loan A and Term Loan B, respectively. Such agreement notwithstanding,
Agent, Swing Lender, and the other Lenders agree (which agreement shall not be
for the benefit of any Borrower) that in order to facilitate the administration
of this Agreement and the other Loan Documents, settlement among the Lenders as
to the Advances, Term Loan A and Term Loan B, the Swing Loans, and the
Protective Advances shall take place on a periodic basis in accordance with the
following provisions:

                        (i) Agent shall request settlement ("Settlement") with
the Lenders on a weekly basis, or on a more frequent basis if so determined by
Agent (1) on behalf of Swing Lender, with respect to the outstanding Swing
Loans, (2) for itself, with respect to the outstanding Protective Advances, and
(3) with respect to Borrowers' or their Subsidiaries' Collections received, as
to each by notifying the Lenders by telecopy, telephone, or other similar form
of transmission, of such requested Settlement, no later than 2:00 p.m.
(California time) on the Business Day immediately prior to the date of such
requested Settlement (the date of such requested Settlement being the
"Settlement Date"). Such notice of a Settlement Date shall include a summary
statement of the amount of outstanding Advances, Term Loan A, Term Loan B, Swing
Loans, and Protective Advances for the period since the prior Settlement Date.
Subject to the terms and conditions contained herein (including Section
2.3(c)(iii)): (y) if a Lender's balance of the Advances (including Swing Loans
and Protective Advances), Term Loan A, or Term Loan B exceeds such Lender's
respective Pro Rata Share of the Advances (including Swing Loans and Protective
Advances), Term Loan A or Term Loan B as of a Settlement Date, then Agent shall,
by no later than 12:00 p.m. (California time) on the Settlement Date, transfer

                                       6
<PAGE>

in immediately available funds to a Deposit Account of such Lender (as such
Lender may designate), an amount such that each such Lender shall, upon receipt
of such amount, have as of the Settlement Date, its respective Pro Rata Share of
the Advances (including Swing Loans and Protective Advances), Term Loan A and
Term Loan B, and (z) if a Lender's balance of the Advances (including Swing
Loans and Protective Advances), Term Loan A or Term Loan B is less than such
Lender's respective Pro Rata Share of the Advances (including Swing Loans and
Protective Advances), Term Loan A or Term Loan B as of a Settlement Date, such
Lender shall no later than 12:00 p.m. (California time) on the Settlement Date
transfer in immediately available funds to the Agent's Account, an amount such
that each such Lender shall, upon transfer of such amount, have as of the
Settlement Date, its respective Pro Rata Share of the Advances (including Swing
Loans and Protective Advances), Term Loan A and Term Loan B. Such amounts made
available to Agent under clause (z) of the immediately preceding sentence shall
be applied against the amounts of the applicable Swing Loans or Protective
Advances and, together with the portion of such Swing Loans or Protective
Advances representing Swing Lender's Pro Rata Share thereof, shall constitute
Advances of such Lenders. If any such amount is not made available to Agent by
any Lender on the Settlement Date applicable thereto to the extent required by
the terms hereof, Agent shall be entitled to recover for its account such amount
on demand from such Lender together with interest thereon at the Defaulting
Lender Rate.

                        (ii) In determining whether a Lender's balance of the
Advances, Swing Loans, Protective Advances, Term Loan A, and Term Loan B is less
than, equal to, or greater than such Lender's respective Pro Rata Share of the
Advances, Swing Loans, Protective Advances, Term Loan A, and Term Loan B as of a
Settlement Date, Agent shall, as part of the relevant Settlement, apply to such
balance the portion of payments actually received in good funds by Agent with
respect to principal, interest, fees payable by Borrowers and allocable to the
Lenders hereunder, and proceeds of Collateral. To the extent that a net amount
is owed to any such Lender after such application, such net amount shall be
distributed by Agent to that Lender as part of such next Settlement.

                        (iii) Between Settlement Dates, Agent, to the extent no
Protective Advances or Swing Loans are outstanding, may pay over to Swing Lender
any payments received by Agent, that in accordance with the terms of this
Agreement would be applied to the reduction of the Advances, for application to
Swing Lender's Pro Rata Share of the Advances. If, as of any Settlement Date,
Collections of Borrowers or their Subsidiaries received since the then
immediately preceding Settlement Date have been applied to Swing Lender's Pro
Rata Share of the Advances other than to Swing Loans, as provided for in the
previous sentence, Swing Lender shall pay to Agent for the accounts of the
Lenders, and Agent shall pay to the Lenders, to be applied to the outstanding
Advances of such Lenders, an amount such that each Lender shall, upon receipt of
such amount, have, as of such Settlement Date, its Pro Rata Share of the
Advances. During the period between Settlement Dates, Swing Lender with respect
to Swing Loans, Agent with respect to Protective Advances, and each Lender
(subject to the effect of agreements between Agent and individual Lenders) with
respect to the Advances other than Swing Loans and Protective Advances, shall be
entitled to interest at the applicable rate or rates payable under this
Agreement on the daily amount of funds employed by Swing Lender, Agent, or the
Lenders, as applicable.

                (f) Notation. Agent shall record on its books the principal
amount of the Advances, Term Loan A and Term Loan B owing to each Lender,
including the Swing Loans owing to Swing Lender, and Protective Advances owing
to Agent, and the interests therein of each Lender, from time to time and such
records shall, absent manifest error, conclusively be presumed to be correct and
accurate.

                (g) Lenders' Failure to Perform. All Advances or Term Loan B
draws, as the case may be (other than Swing Loans and Protective Advances) shall
be made by the Lenders contemporaneously and in accordance with their Pro Rata
Shares. It is understood that (i) no Lender shall be responsible for any failure
by any other Lender to perform its obligation to make any Advance or Term Loan
B, as the case may be (or other extension of credit) hereunder, nor shall any
Commitment of any Lender be increased or decreased as a result of any failure by
any other Lender to perform its obligations hereunder, and (ii) no failure by
any Lender to perform its obligations hereunder shall excuse any other Lender
from its obligations hereunder.

                                       7
<PAGE>

         2.4      Payments.

                (a) Payments by Borrowers.

                        (i) Except as otherwise expressly provided herein, all
payments by Borrowers shall be made to Agent's Account for the account of the
Lender Group and shall be made in immediately available funds, no later than
11:00 a.m. (California time) on the date specified herein. Any payment received
by Agent later than 11:00 a.m. (California time), shall be deemed to have been
received on the following Business Day and any applicable interest or fee shall
continue to accrue until such following Business Day.

                        (ii) Unless Agent receives notice from Administrative
Borrower prior to the date on which any payment is due to the Lenders that
Borrowers will not make such payment in full as and when required, Agent may
assume that Borrowers have made (or will make) such payment in full to Agent on
such date in immediately available funds and Agent may (but shall not be so
required), in reliance upon such assumption, distribute to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent Borrowers do not make such payment in full to Agent on the date when due,
each Lender severally shall repay to Agent on demand such amount distributed to
such Lender, together with interest thereon at the Defaulting Lender Rate for
each day from the date such amount is distributed to such Lender until the date
repaid.

                (b) Apportionment and Application.

                        (i) So long as no Event of Default has occurred and is
continuing and except as otherwise provided with respect to Defaulting Lenders,
all principal and interest payments shall be apportioned ratably among the
Lenders (according to the unpaid principal balance of the Obligations to which
such payments relate held by each Lender) and all payments of fees and expenses
(other than fees or expenses that are for Agent's separate account) shall be
apportioned ratably among the Lenders having a Pro Rata Share of the type of
Commitment or Obligation to which a particular fee or expense relates. All
payments to be made hereunder by Borrowers shall be remitted to Agent and all
(subject to Section 2.4(b)(iv) hereof) such payments, and all proceeds of
Collateral received by Agent, shall be applied, so long as no Event of Default
has occurred and is continuing, to reduce the balance of the Advances
outstanding and, thereafter, to Borrowers (to be wired to the Designated
Account) or such other Person entitled thereto under applicable law.

                        (ii) At any time that an Event of Default has occurred
and is continuing and except as otherwise provided with respect to Defaulting
Lenders, all payments remitted to Agent and all proceeds of Collateral received
by Agent shall be applied as follows:

                                (A) first, to pay any Lender Group Expenses
(including, without limitation, the reasonable attorneys' fees and costs) or
indemnities then due to Agent under the Loan Documents, until paid in full,

                                (B) second, to pay any fees or premiums then due
to Agent under the Loan Documents until paid in full,

                                (C) third, to pay interest due in respect of all
Protective Advances until paid in full,

                                (D) fourth, to pay the principal of all
Protective Advances until paid in full,

                                (E) fifth, ratably to pay any Lender Group
Expenses (including, without limitation, the reasonable attorneys' fees and
costs) or indemnities then due to any of the Lenders under the Loan Documents,
until paid in full,

                                       8
<PAGE>

                                (F) sixth, ratably to pay any fees or premiums
then due to any of the Lenders under the Loan Documents until paid in full,

                                (G) seventh, ratably to pay interest due in
respect of the Advances (other than Protective Advances), the Swing Loans, and
the Term Loans until paid in full,

                                (H) eighth, ratably (i) to pay the principal of
all Swing Loans until paid in full, (ii) to pay the principal of all Advances
until paid in full, (iii) to Agent, to be held by Agent, for the ratable benefit
of Issuing Lender and those Lenders having a Revolver Commitment, as cash
collateral in an amount up to 105% of the Letter of Credit Usage, (iv) to Agent,
to be held by Agent, for the benefit of the Bank Product Providers, as cash
collateral in an amount up to the amount of the Bank Product Reserve established
prior to the occurrence of, and not in contemplation of, the subject Event of
Default, and (v) to pay the outstanding principal balance of Term Loan A and
then Term Loan B (in the inverse order of the maturity of the installments due
thereunder) until the Term Loans are paid in full,

                                (I) ninth, to pay any other Obligations
(including the provision of amounts to Agent, to be held by Agent, for the
benefit of the Bank Product Providers, as cash collateral in an amount up to the
amount determined by Agent in its Permitted Discretion as the amount necessary
to secure Borrowers' and their Subsidiaries' obligations in respect of Bank
Products), and

                                (J) tenth, to Borrowers (to be wired to the
Designated Account) or such other Person entitled thereto under applicable law.

                        (iii) Agent promptly shall distribute to each Lender,
pursuant to the applicable wire instructions received from each Lender in
writing, such funds as it may be entitled to receive, subject to a Settlement
delay as provided in Section 2.3(e).

                        (iv) In each instance, so long as no Event of Default
has occurred and is continuing, Section 2.4(b)(i) shall not apply to any payment
made by Borrowers to Agent and specified by Borrowers to be for the payment of
specific Obligations then due and payable (or prepayable) under any provision of
this Agreement.

                        (v) For purposes of Section 2.4(b)(ii), "paid in full"
means payment of all amounts owing under the Loan Documents according to the
terms thereof, including loan fees, service fees, professional fees, interest
(and specifically including interest accrued after the commencement of any
Insolvency Proceeding), default interest, interest on interest, and expense
reimbursements, whether or not any of the foregoing would be or is allowed or
disallowed in whole or in part in any Insolvency Proceeding.

                        (vi) In the event of a direct conflict between the
priority provisions of this Section 2.4 and any other provision contained in any
other Loan Document, it is the intention of the parties hereto that such
provisions be read together and construed, to the fullest extent possible, to be
in concert with each other. In the event of any actual, irreconcilable conflict
that cannot be resolved as aforesaid, the terms and provisions of this Section
2.4 shall control and govern.

                (c) Mandatory Prepayments.

                        (i) If, as of the last day of any month (A) that is
other than a day upon which a Term Loan B is being made, (I) the sum of the
outstanding principal balance of Term Loan A and the outstanding principal
balance of Term Loan B on such date plus the Revolver Usage on such date exceeds
(II) the Borrowing Base Multiple multiplied by the TTM EBITDA (the "Loan Limit"
and such excess being referred to as the "Limiter Excess"), then Borrowers shall
immediately prepay the Obligations in accordance with Section 2.4(e)(i) in an
aggregate amount equal to the Limiter Excess or (B) that is a day upon which a
Term Loan B is being made, (I) the sum of the outstanding principal balance of

                                       9
<PAGE>

Term Loan A and the outstanding principal balance of Term Loan B on such date
after giving effect to the Term Loan B being made on such day, plus the Revolver
Usage on such date exceeds (II) the Acquisition Multiple multiplied by the TTM
EBITDA (such excess being referred to as the "Term Limiter Excess"), then
Borrowers shall immediately prepay the Obligations in accordance with Section
2.4(e)(i) in an aggregate amount equal to the Term Limiter Excess.

                        (ii) As promptly as practicable but in no event later
than the end of the next Business Day upon the receipt by Borrowers or any of
their Subsidiaries of the proceeds of any voluntary or involuntary sale or
disposition by Borrowers or any of their Subsidiaries of property or assets
(including casualty losses or condemnations but excluding sales or dispositions
which qualify as Permitted Dispositions under clauses (a), (b), (c), or (d) of
the definition of Permitted Dispositions and excluding sales of contracts),
Borrowers shall prepay the outstanding principal amount of the Obligations in
accordance with Section 2.4(e)(ii) in an amount equal to 100% of the Net Cash
Proceeds (including condemnation awards and payments in lieu thereof) received
by such Person in connection with such sales or dispositions; provided that, so
long as (A) no Default or Event of Default shall have occurred and is
continuing, (B) Administrative Borrower shall have given Agent prior written
notice of Borrowers' intention to apply such monies to the costs of replacement
of the properties or assets that are the subject of such sale or disposition,
(C) the monies are held in a cash collateral account in which Agent has a
perfected first-priority security interest, and (D) Borrowers or their
Subsidiaries, as applicable, complete such replacement, purchase, or
construction within 270 days after the initial receipt of such monies, Borrowers
and their Subsidiaries shall have the option to apply all of such monies to the
costs of replacement of the property or assets that are the subject of such sale
or disposition or the costs of purchase or construction of other assets useful
in the business of Borrowers and their Subsidiaries unless and to the extent
that such applicable period shall have expired without such replacement,
purchase or construction being made or completed, in which case, any amounts
remaining in the cash collateral account shall be paid to Agent and applied in
accordance with Section 2.4(e)(ii). Nothing contained in this Section 2.4(c)(ii)
shall permit Borrowers or any of their Subsidiaries to sell or otherwise dispose
of any property or assets other than in accordance with Section 6.4.

                        (iii) As promptly as practicable but in no event later
than the end of the next Business Day upon the receipt by Borrowers or any of
their Subsidiaries of any Extraordinary Receipts, Borrowers shall prepay the
outstanding principal amount of the Obligations in accordance with Section
2.4(e)(ii) in an amount equal to 100% of such Extraordinary Receipts, net of any
reasonable expenses incurred in collecting such Extraordinary Receipts.

                        (iv) As promptly as practicable but in no event later
than the end of the next Business Day upon the issuance of any stock by any of
the Borrowers or any of their Subsidiaries or the issuance or incurrence by
Borrowers or any of their Subsidiaries of any Indebtedness (other than
Indebtedness permitted under Section 6.1(a), (b), (c), (d), or (e)), Borrowers
shall prepay the outstanding principal amount of the Obligations in accordance
with Section 2.4(e)(ii) in an amount equal to 100% of the Net Cash Proceeds
received by such Person in connection with such issuance or incurrence.
Notwithstanding the foregoing in this Section 2.4 (c)(iv), no prepayment shall
be required from the proceeds of any issuance of equity so long as no Event of
Default has occurred and is continuing and either (a) the proceeds of the equity
issuance are used for a Permitted Acquisition, and (b) the Senior Leverage Ratio
is less that 1.5:1.0 both immediately before and taking into account the
Permitted Acquisition. The provisions of this Section 2.4(c)(iv) shall not be
deemed to be implied consent to any such issuance or incurrence otherwise
prohibited by the terms and conditions of this Agreement.

                        (v) Within 10 days of delivery to Agent and the Lenders
of audited annual financial statements pursuant to Section 5.3, commencing with
the delivery to Agent and the Lenders of the financial statements for Parent's
fiscal year ended 2006 or, if such financial statements are not delivered to
Agent and the Lenders on the date such statements are required to be delivered
pursuant to Section 5.3, 10 days after the date such statements are required to
be delivered to Agent and the Lenders pursuant to Section 5.3, Borrowers shall
prepay the outstanding principal amount of the Obligations in accordance with
Section 2.4(e)(ii) in an amount equal to 35% of the Excess Cash Flow of
Borrowers and their Subsidiaries for such fiscal year.

                                       10
<PAGE>

                        (vi) Immediately upon the receipt by Borrowers or any of
their Subsidiaries of the proceeds of any voluntary or involuntary sale or
disposition by Borrowers or any of their contracts, Borrowers shall prepay the
outstanding principal amount of the Obligations in accordance with Section
2.4(e)(ii) in an amount equal to 100% of the Net Cash Proceeds received by such
Person in connection with such sales or dispositions. The provisions of this
Section 2.4(c)(vi) shall not be deemed to be implied consent to any sale of any
contract otherwise prohibited by the terms and conditions of this Agreement.

                        (vii) No mandatory prepayment made pursuant to this
Section 2.4(c) that results in a partial prepayment of the Loans shall be
subject to the Applicable Prepayment Premium.

                (d) Optional Prepayments. The Borrowers may, upon written notice
to Agent, without premium or penalty, prepay the Term Loans so long as both
immediately before and after giving effect to any such prepayment, the Borrowers
have Excess Availability plus Qualified Cash of not less than $1,000,000. Any
prepayment made under this Section 2.4(d) must be in a minimum amount of
$500,000, or any multiple of $500,000 in excess thereof. Written notice of an
intended prepayment of the Term Loans shall specify the amount of the prepayment
and the Term Loan to which it should be applied, shall be irrevocable once
given, and shall be given at least 5 Business Days prior to planned prepayment
date. Any prepayment under this Section 2.4(d) shall be applied to the
installments due in respect of the applicable Term Loan in the inverse order of
their maturity. If, in connection with any prepayment made pursuant to this
Section 2.4(d), this Agreement is terminated prior to the Maturity Date, the
Borrowers shall pay to the Agent a fee in an amount equal to the Applicable
Prepayment Premium; provided, that, absent such termination, any permitted
prepayment of the Term Loans or reduction of the Revolver Usage shall not reduce
the determination of the Applicable Prepayment Premium that is otherwise
applicable under this Section 2.4(d).

                (e) Application of Payments.

                        (i) Each prepayment pursuant to Section 2.4(c)(i) shall,
(A) so long as no Event of Default shall have occurred and be continuing, be
applied, first, to the outstanding principal amount of the Advances until paid
in full, second, to cash collateralize the Letters of Credit in an amount equal
to 105% of the then extant Letter of Credit Usage, third, to the outstanding
principal amount of Term Loan A until paid in full, fourth, to the outstanding
principal amount of Term Loan B until paid in full and (B) if an Event of
Default shall have occurred and be continuing, be applied in the manner set
forth in Section 2.4(b)(ii). Each such prepayment of the Term Loans shall be
applied against the remaining installments of principal of the Term Loans in the
inverse order of maturity.

                        (ii) Each prepayment pursuant to Section 2.4(c)(ii),
2.4(c)(iii), 2.4(c)(iv), 2.4(c)(v), or 2.4(c)(vi) above shall (A) so long as no
Event of Default shall have occurred and be continuing, first, to the
outstanding principal amount of the Term Loan A until paid in full, second, to
the outstanding principal amount of the Term Loan B until paid in full, third,
to the outstanding principal amount of the Advances until paid in full, and
fourth, to cash collateralize the Letters of Credit in an amount equal to 105%
of the then extant Letter of Credit Usage (with a corresponding permanent
reduction in the Maximum Revolver Amount), and (B) if an Event of Default shall
have occurred and be continuing, be applied in the manner set forth in Section
2.4(b)(ii). Each such prepayment of the Term Loans shall be applied against the
remaining installments of principal of the Term Loans in the inverse order of
maturity.

         2.5 Overadvances. If, at any time or for any reason, the amount of
Obligations owed by Borrowers to the Lender Group pursuant to Section 2.1 or
Section 2.12 is greater than any of the limitations set forth in Section 2.1 or
Section 2.12, as applicable (an "Overadvance"), Borrowers immediately shall pay
to Agent, in cash, the amount of such excess, which amount shall be used by
Agent to reduce the Obligations in accordance with the priorities set forth in
Section 2.4(b). Borrowers promise to pay the Obligations (including principal,
interest, fees, costs, and expenses) in Dollars in full on the Maturity Date or,
if earlier, on the date on which the Obligations are declared due and payable
pursuant to the terms of this Agreement.

                                       11
<PAGE>

         2.6 Interest Rates and Letter of Credit Fee:  Rates, Payments, and
Calculations.

                (a) Interest Rates. Except as provided in Section 2.6(c), all
Obligations (except for undrawn Letters of Credit and except for Bank Product
Obligations) that have been charged to the Loan Account pursuant to the terms
hereof shall bear interest on the Daily Balance thereof as follows (i) if the
relevant Obligation is an Advance that is a LIBOR Rate Loan, at a per annum rate
equal to the LIBOR Rate plus the Applicable Margin, (ii) if the relevant
Obligation is a portion of the Term Loans that is a LIBOR Rate Loan, at a per
annum rate equal to the LIBOR Rate plus the Applicable Margin, (iii) if the
relevant Obligation is a portion of the Term Loans that is a Base Rate Loan, at
a per annum rate equal to the Base Rate plus the Applicable Margin, and (iv)
otherwise, at a per annum rate equal to the Base Rate plus the Applicable
Margin.

                (b) Letter of Credit Fee. Borrowers shall pay Agent (for the
ratable benefit of the Lenders with a Revolver Commitment, subject to any
agreements between Agent and individual Lenders), a Letter of Credit fee (in
addition to the charges, commissions, fees, and costs set forth in Section
2.12(e)) which shall accrue at a rate equal to 3.75% per annum times the Daily
Balance of the undrawn amount of all outstanding Letters of Credit.

                (c) Default Rate. Upon the occurrence and during the
continuation of an Event of Default (and at the election of Agent or the
Required Lenders),

                        (i) all Obligations (except for undrawn Letters of
Credit and except for Bank Product Obligations) that have been charged to the
Loan Account pursuant to the terms hereof shall bear interest on the Daily
Balance thereof at a per annum rate equal to 2 percentage points above the per
annum rate otherwise applicable hereunder, and

                        (ii) the Letter of Credit fee provided for in Section
2.6(b) shall be increased to 2 percentage points above the per annum rate
otherwise applicable hereunder.

                (d) Payment. Except as provided to the contrary in Section 2.11
or Section 2.13(a), interest, Letter of Credit fees, and all other fees payable
hereunder shall be due and payable, in arrears, on the first day of each month
at any time that Obligations or Commitments are outstanding. Borrowers hereby
authorize Agent, from time to time, without prior notice to Borrowers, to charge
all interest and fees (when due and payable), all Lender Group Expenses (as and
when incurred), all charges, commissions, fees, and costs provided for in
Section 2.12(e) (as and when accrued or incurred), all fees and costs provided
for in Section 2.11 (as and when accrued or incurred), and all other payments as
and when due and payable under any Loan Document (including the amounts due and
payable with respect to the Term Loans and including any amounts due and payable
to the Bank Product Providers in respect of Bank Products up to the amount of
the Bank Product Reserve) to Borrowers' Loan Account, which amounts thereafter
shall constitute Advances hereunder and shall accrue interest at the rate then
applicable to Advances that are Base Rate Loans. Any interest not paid when due
shall be compounded by being charged to the Loan Account and shall thereafter
constitute Advances hereunder and shall accrue interest at the rate then
applicable to Advances that are Base Rate Loans.

                (e) Computation. All interest and fees chargeable under the Loan
Documents shall be computed on the basis of a 360 day year for the actual number
of days elapsed. In the event the Base Rate is changed from time to time
hereafter, the rates of interest hereunder based upon the Base Rate
automatically and immediately shall be increased or decreased by an amount equal
to such change in the Base Rate.

                                       12
<PAGE>

                (f) Intent to Limit Charges to Maximum Lawful Rate. In no event
shall the interest rate or rates payable under this Agreement, plus any other
amounts paid in connection herewith, exceed the highest rate permissible under
any law that a court of competent jurisdiction shall, in a final determination,
deem applicable. Borrowers and the Lender Group, in executing and delivering
this Agreement, intend legally to agree upon the rate or rates of interest and
manner of payment stated within it; provided, however, that, anything contained
herein to the contrary notwithstanding, if said rate or rates of interest or
manner of payment exceeds the maximum allowable under applicable law, then, ipso
facto, as of the date of this Agreement, Borrowers are and shall be liable only
for the payment of such maximum as allowed by law, and payment received from
Borrowers in excess of such legal maximum, whenever received, shall be applied
to reduce the principal balance of the Obligations to the extent of such excess.

         2.7 Cash Management.

                (a) At all times, Borrowers shall and shall cause each of their
respective Subsidiaries to establish and maintain cash management services of a
type and on terms satisfactory to Agent at one or more of the banks set forth on
Schedule 2.7(a) (each a "Cash Management Bank"), and shall request in writing
and otherwise take such reasonable steps to ensure that all of their and their
Subsidiaries' Account Debtors, Payors, and other third parties forward all
Collections (including payment of the amounts owed by them) directly to such
Cash Management Bank. All payments on Accounts received directly by any of the
Borrowers shall be held by each Borrower, in trust, for the benefit of Agent,
until such amounts are deposited into a Cash Management Account. So long as no
Default or Event of Default has occurred and is continuing, Administrative
Borrower may amend Schedule 2.7(a) to add or replace a Cash Management Bank or
Cash Management Account; provided, however, that (i) such prospective Cash
Management Bank shall be reasonably satisfactory to Agent, and (ii) prior to the
time of opening of any Cash Management Account (other than a replacement
Borrower Collection Account), the Administrative Borrower and such prospective
Cash Management Bank shall have executed and delivered to Agent a Cash
Management Agreement and Agent shall have received such documentation as Agent
may reasonably require to evidence the establishment of the procedures set forth
in this Section 2.7, including, without limitation, copies of applicable Payor
Notices. Borrowers (or their Subsidiaries, as applicable) shall close any of
their Deposit Accounts (and establish any such replacement Deposit Accounts as
may be deemed necessary by Agent in its Permitted Discretion) promptly and in
any event within 30 days of notice from Agent that the creditworthiness of any
Cash Management Bank is no longer acceptable in Agent's reasonable judgment, or
as promptly as practicable and in any event within 60 days of notice from Agent
that the operating performance, funds transfer, or availability procedures or
performance of the Cash Management Bank with respect to the Deposit Accounts or
Agent's liability under any Cash Management Agreement with such Cash Management
Bank is no longer acceptable in Agent's reasonable judgment.

                (b) Without limiting clause (a) above, within 15 days of the
Closing Date, Administrative Borrower shall establish and thereafter maintain at
all times the following Deposit Accounts (each, a "Cash Management Account") at
a Cash Management Bank with respect to Collections: (i) one for the collection
of Governmental Receivables (the "Borrower Collection Account"), and (ii) one
for the collection of all other Accounts (the "Agent Collection Account"). The
Borrower Collection Account shall be an account in the name of Administrative
Borrower and shall be the property of Borrowers. The Agent Collection Account
shall be in the name of Agent and shall be the sole and exclusive property of
Agent.

                (c) Promptly following the establishment of the Borrower
Collection Account, Borrowers agree to notify all Payors on Governmental
Receivables in writing (with a copy to Agent) to remit all payments directly to
the Borrower Collection Account. Borrowers further agree to use commercially
reasonable efforts to cause all such Payors to remit payments to the Borrower
Collection Account at all times thereafter. Each Borrower agrees that it shall
not deposit or cause to be deposited any funds other than payments on
Governmental Receivables into the Borrower Collection Account.

                (d) Following the establishment of each of the Borrower
Collection Account and the Agent Collection Account, Borrowers shall deposit or
cause to be deposited promptly, and in any event no later than the first
Business Day after the date of receipt thereof, all Collections received by

                                       13
<PAGE>

Borrowers directly in respect of Governmental Receivables into the Borrower
Collection Account and all other Collections (including those sent directly by
their Account Debtors to Borrowers or their Subsidiaries) into the Agent
Collection Account.

                (e) Borrowers agree that, upon Agent's request, with respect to
all of Borrowers' Deposit Accounts, other than the Borrower Collection Account
and each of the disbursement Deposit Accounts set forth on Schedule 2.7(i), (a)
Borrower will cause each Cash Management Bank to establish and maintain Cash
Management Agreements with Agent and Borrowers, in form and substance acceptable
to Agent. Each such Cash Management Agreement shall provide, among other things,
that (i) the Cash Management Bank will comply with any instructions (each, a
"Cash Disposition Instruction"), originated by Agent directing the disposition
of the funds in the applicable Deposit Account without further consent by
Borrowers or their Subsidiaries, as applicable, (ii) the Cash Management Bank
has no rights of setoff or recoupment or any other claim against the applicable
Deposit Account, other than for payment of its service fees and other charges
directly related to the administration of such Deposit Account and for returned
checks or other items of payment, and (iii) at any time after which the Agent so
instructs such Cash Management Bank (a "Cash Sweep Instruction"), it immediately
will forward by daily sweep all amounts in the applicable Deposit Account to the
Agent's Account. None of the Borrowers shall have any right to or interest in
Agent's Account. Notwithstanding anything to the contrary contained herein, the
Agent agrees that it will not send a Cash Sweep Instruction until the
occurrence, and during the continuation, of an Event of Default.

                (f) Once the Borrower Collection Account is established,
Administrative Borrower shall instruct the applicable Cash Management Bank,
pursuant to a standing wire transfer instruction, to automatically transfer at
the end of each Business Day all amounts in the Borrower Collection Account to
any of Borrowers' other Deposit Accounts that is subject to a Cash Management
Agreement; provided that at the written direction of Agent, after occurrence and
during the continuation of a Event of Default, Administrative Borrower shall
instruct the applicable Cash Management Bank, pursuant to a standing wire
transfer instruction, to automatically transfer at the end of each Business Day
all amounts in the Borrower Collection Account to Agent's Account. Except as
expressly set forth above, no Borrower (including Administrative Borrower) shall
change or cancel any such automatic transfer order at any time. No Borrower
(including Administrative Borrower) may, without the prior written consent of
Agent, change either the identity of the Cash Management Accounts or the
instructions to each Payor on the related Account to make its payments to such
account.

                (g) Without limiting Borrowers obligations under clause (c)
above, each Borrower shall notify all Payors using forms of notices approved by
Agent (collectively, the "Payor Notices") to remit payment to the appropriate
Cash Management Account, as Agent may from time to time reasonably request. If
any Payor makes payment in respect of any Account to a location other than the
applicable Cash Management Account (a "Misdirected Payment"), each Borrower (at
its own cost and expense) shall (i) use its best efforts to promptly take all
necessary steps to effect collection of such Misdirected Payment from any other
Person claiming an interest therein or having possession thereof, (ii) hold such
payment in trust for Agent, (iii) segregate such payment and not deposit such
payment in such Borrower's own account, nor commingle such payment with such
Borrower's own funds or other assets, and (iv) deliver such payment to a Cash
Management Bank for deposit in the applicable Cash Management Account no later
than the close of Business on the third Business Day after receipt.

                (h) [Reserved].

                        (i) Except for the Borrower Collection Account and the
disbursement Deposit Accounts set forth on Schedule 2.7(i), following the
delivery of the Cash Management Agreements referenced in clause (e) above,
Borrowers and their respective Subsidiaries shall not maintain any Deposit
Accounts that are not subject to Control Agreements or Cash Management
Agreements, as applicable. Borrowers represent and warrant that each of the
Deposit Accounts set forth on Schedule 2.7(i) is maintained as a payroll
disbursement account only and that no funds other than those necessary to fund
payroll are on deposit therein at any time.

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<PAGE>

         2.8 Crediting Payments. The receipt of any payment item by Agent
(whether from transfers to Agent by the Cash Management Banks pursuant to the
Cash Management Agreements or otherwise) shall not be considered a payment on
account unless such payment item is a wire transfer of immediately available
federal funds made to the Agent's Account or unless and until such payment item
is honored when presented for payment. Should any payment item not be honored
when presented for payment, then Borrowers shall be deemed not to have made such
payment and interest shall be calculated accordingly. Anything to the contrary
contained herein notwithstanding, any payment item shall be deemed received by
Agent only if it is received into the Agent's Account on a Business Day on or
before 11:00 a.m. (California time). If any payment item is received into the
Agent's Account on a non-Business Day or after 11:00 a.m. (California time) on a
Business Day, it shall be deemed to have been received by Agent as of the
opening of business on the immediately following Business Day.

         2.9 Designated Account. Agent is authorized to make the Advances and
the Term Loans, and Issuing Lender is authorized to issue the Letters of Credit,
under this Agreement based upon telephonic or other instructions received from
anyone purporting to be an Authorized Person or, without instructions, if
pursuant to Section 2.6(d). Administrative Borrower agrees to establish and
maintain the Designated Account with the Designated Account Bank for the purpose
of receiving the proceeds of the Advances requested by Borrowers and made by
Agent or the Lenders hereunder. Unless otherwise agreed by Agent and
Administrative Borrower, any Advance, Protective Advance, or Swing Loan
requested by Borrowers and made by Agent or the Lenders hereunder shall be made
to the Designated Account.

         2.10 Maintenance of Loan Account; Statements of Obligations. Agent
shall maintain an account on its books in the name of Borrowers (the "Loan
Account") on which Borrowers will be charged with the Term Loan, all Advances
(including Protective Advances and Swing Loans) made by Agent, Swing Lender, or
the Lenders to Borrowers or for Borrowers' account, the Letters of Credit issued
by Issuing Lender for Borrowers' account, and with all other payment Obligations
hereunder or under the other Loan Documents (except for Bank Product
Obligations), including, accrued interest, fees and reasonable expenses, and
Lender Group Expenses. In accordance with Section 2.8, the Loan Account will be
credited with all payments received by Agent from Borrowers or for Borrowers'
account, including all amounts received in the Agent's Account from any Cash
Management Bank. Agent shall render statements regarding the Loan Account to
Administrative Borrower, including principal, interest, fees, and including an
itemization of all charges and expenses constituting Lender Group Expenses
owing, and such statements, absent manifest error, shall be conclusively
presumed to be correct and accurate and constitute an account stated between
Borrowers and the Lender Group unless, within 30 days after receipt thereof by
Administrative Borrower, Administrative Borrower shall deliver to Agent written
objection thereto describing the error or errors contained in any such
statements.

         2.11 Fees. Borrowers shall pay to Agent, as and when due and payable
under the terms of the Fee Letter, the fees set forth in the Fee Letter.

         2.12     Letters of Credit.

                (a) Subject to the terms and conditions of this Agreement, the
Issuing Lender agrees to issue letters of credit for the account of Borrowers
(each, an "L/C") or to purchase participations or execute indemnities or
reimbursement obligations (each such undertaking, an "L/C Undertaking") with
respect to letters of credit issued by an Underlying Issuer (as of the Closing
Date, the prospective Underlying Issuer is to be Wells Fargo) for the account of
Borrowers. Each request for the issuance of a Letter of Credit or the amendment,
renewal, or extension of any outstanding Letter of Credit, shall be made in
writing by an Authorized Person and delivered to the Issuing Lender and Agent
via hand delivery, telefacsimile, or other electronic method of transmission
reasonably in advance of the requested date of issuance, amendment, renewal, or
extension. Each such request shall be in form and substance satisfactory to the
Issuing Lender in its Permitted Discretion and shall specify (i) the amount of
such Letter of Credit, (ii) the date of issuance, amendment, renewal, or
extension of such Letter of Credit, (iii) the expiration date of such Letter of

                                       15
<PAGE>

Credit, (iv) the name and address of the beneficiary thereof (or the beneficiary
of the Underlying Letter of Credit, as applicable), and (v) such other
information (including, in the case of an amendment, renewal, or extension,
identification of the outstanding Letter of Credit to be so amended, renewed, or
extended) as shall be necessary to prepare, amend, renew, or extend such Letter
of Credit. If requested by the Issuing Lender, Borrowers also shall be an
applicant under the application with respect to any Underlying Letter of Credit
that is to be the subject of an L/C Undertaking. The Issuing Lender shall have
no obligation to issue a Letter of Credit if any of the following would result
after giving effect to the issuance of such requested Letter of Credit:

                        (i) the Letter of Credit Usage would exceed the
Borrowing Base less the outstanding amount of Advances, or

                        (ii) the Letter of Credit Usage would exceed $1,000,000,
or

                        (iii) the Letter of Credit Usage would exceed the
Maximum Revolver Amount less the outstanding amount of Advances less the Bank
Product Reserve, and less the aggregate amount of reserves, if any, established
by Agent under Section 2.1(b).

                Borrowers and the Lender Group acknowledge and agree that
certain Underlying Letters of Credit may be issued to support letters of credit
that already are outstanding as of the Closing Date. Each Letter of Credit (and
corresponding Underlying Letter of Credit) shall be in form and substance
acceptable to the Issuing Lender (in the exercise of its Permitted Discretion),
including the requirement that the amounts payable thereunder must be payable in
Dollars. If Issuing Lender is obligated to advance funds under a Letter of
Credit, Borrowers immediately shall reimburse such L/C Disbursement to Issuing
Lender by paying to Agent an amount equal to such L/C Disbursement not later
than 11:00 a.m., California time, on the date that such L/C Disbursement is
made, if Administrative Borrower shall have received written or telephonic
notice of such L/C Disbursement prior to 10:00 a.m., California time, on such
date, or, if such notice has not been received by Administrative Borrower prior
to such time on such date, then not later than 11:00 a.m., California time, on
the Business Day that Administrative Borrower receives such notice, if such
notice is received prior to 10:00 a.m., California time, on the date of receipt,
and, in the absence of such reimbursement, the L/C Disbursement immediately and
automatically shall be deemed to be an Advance hereunder and, initially, shall
bear interest at the rate then applicable to Advances that are Base Rate Loans.
To the extent an L/C Disbursement is deemed to be an Advance hereunder,
Borrowers' obligation to reimburse such L/C Disbursement shall be discharged and
replaced by the resulting Advance. Promptly following receipt by Agent of any
payment from Borrowers pursuant to this paragraph, Agent shall distribute such
payment to the Issuing Lender or, to the extent that Lenders have made payments
pursuant to Section 2.12(b) to reimburse the Issuing Lender, then to such
Lenders and the Issuing Lender as their interests may appear.

                (b) Promptly following receipt of a notice of L/C Disbursement
pursuant to Section 2.12(a), each Lender with a Revolver Commitment agrees to
fund its Pro Rata Share of any Advance deemed made pursuant to the foregoing
subsection on the same terms and conditions as if Borrowers had requested such
Advance and Agent shall promptly pay to Issuing Lender the amounts so received
by it from the Lenders. By the issuance of a Letter of Credit (or an amendment
to a Letter of Credit increasing the amount thereof) and without any further
action on the part of the Issuing Lender or the Lenders with Revolver
Commitments, the Issuing Lender shall be deemed to have granted to each Lender
with a Revolver Commitment, and each Lender with a Revolver Commitment shall be
deemed to have purchased, a participation in each Letter of Credit, in an amount
equal to its Pro Rata Share of the Risk Participation Liability of such Letter
of Credit, and each such Lender agrees to pay to Agent, for the account of the
Issuing Lender, such Lender's Pro Rata Share of any payments made by the Issuing
Lender under such Letter of Credit. In consideration and in furtherance of the
foregoing, each Lender with a Revolver Commitment hereby absolutely and
unconditionally agrees to pay to Agent, for the account of the Issuing Lender,
such Lender's Pro Rata Share of each L/C Disbursement made by the Issuing Lender
and not reimbursed by Borrowers on the date due as provided in Section 2.12(a),
or of any reimbursement payment required to be refunded to Borrowers for any
reason. Each Lender with a Revolver Commitment acknowledges and agrees that its
obligation to deliver to Agent, for the account of the Issuing Lender, an amount
equal to its respective Pro Rata Share of each L/C Disbursement made by the

                                       16
<PAGE>

Issuing Lender pursuant to this Section 2.12(b) shall be absolute and
unconditional and such remittance shall be made notwithstanding the occurrence
or continuation of an Event of Default or Default or the failure to satisfy any
condition set forth in Section 3. If any such Lender fails to make available to
Agent the amount of such Lender's Pro Rata Share of each L/C Disbursement made
by the Issuing Lender in respect of such Letter of Credit as provided in this
Section, such Lender shall be deemed to be a Defaulting Lender and Agent (for
the account of the Issuing Lender) shall be entitled to recover such amount on
demand from such Lender together with interest thereon at the Defaulting Lender
Rate until paid in full.

                (c) Each Borrower hereby agrees to indemnify, save, defend, and
hold the Lender Group harmless from any loss, cost, expense, or liability (other
than with respect to Excluded Taxes), and reasonable attorneys fees incurred by
the Lender Group arising out of or in connection with any Letter of Credit;
provided, however, that no Borrower shall be obligated hereunder to indemnify
for any loss, cost, expense, or liability to the extent that it is caused by the
gross negligence or willful misconduct of the Issuing Lender or any other member
of the Lender Group. Each Borrower agrees to be bound by the Underlying Issuer's
regulations and interpretations of any Underlying Letter of Credit or by Issuing
Lender's interpretations of any L/C issued by Issuing Lender to or for such
Borrower's account, even though this interpretation may be different from such
Borrower's own, and each Borrower understands and agrees that the Lender Group
shall not be liable for any error, negligence, or mistake, whether of omission
or commission, in following Borrowers' instructions or those contained in the
Letter of Credit or any modifications, amendments, or supplements thereto. Each
Borrower understands that the L/C Undertakings may require Issuing Lender to
indemnify the Underlying Issuer for certain costs or liabilities arising out of
claims by Borrowers against such Underlying Issuer. Each Borrower hereby agrees
to indemnify, save, defend, and hold the Lender Group harmless with respect to
any loss, cost, expense (including reasonable attorneys fees), or liability
incurred by the Lender Group under any L/C Undertaking as a result of the Lender
Group's indemnification of any Underlying Issuer; provided, however, that no
Borrower shall be obligated hereunder to indemnify for any loss, cost, expense,
or liability to the extent that it is caused by the gross negligence or willful
misconduct of the Issuing Lender or any other member of the Lender Group. Each
Borrower hereby acknowledges and agrees that neither the Lender Group nor the
Issuing Lender shall be responsible for delays, errors, or omissions resulting
from the malfunction of equipment in connection with any Letter of Credit.

                (d) Each Borrower hereby authorizes and directs any Underlying
Issuer to deliver to the Issuing Lender all instruments, documents, and other
writings and property received by such Underlying Issuer pursuant to such
Underlying Letter of Credit and to accept and rely upon the Issuing Lender's
instructions with respect to all matters arising in connection with such
Underlying Letter of Credit and the related application.

                (e) Any and all issuance charges, commissions, fees, and costs
incurred by the Issuing Lender (other than with respect to Excluded Taxes)
relating to Underlying Letters of Credit shall be Lender Group Expenses for
purposes of this Agreement and immediately shall be reimbursable by Borrowers to
Agent for the account of the Issuing Lender; it being acknowledged and agreed by
each Borrower that, as of the Closing Date, the issuance charge imposed by the
prospective Underlying Issuer is .825% per annum times the undrawn amount of
each Underlying Letter of Credit, that such issuance charge may be changed from
time to time, and that the Underlying Issuer also imposes a schedule of charges
for amendments, extensions, drawings, and renewals.

                (f) If by reason of (i) any change after the Closing Date in any
applicable law, treaty, rule, or regulation or any change in the interpretation
or application thereof by any Governmental Authority (other than with respect to
Excluded Taxes), or (ii) compliance by the Underlying Issuer or the Lender Group
with any direction, request, or requirement (irrespective of whether having the
force of law) of any Governmental Authority or monetary authority including,
Regulation D of the Federal Reserve Board as from time to time in effect (and
any successor thereto):

                                       17
<PAGE>

                        (i) any reserve, deposit, or similar requirement is or
shall be imposed or modified in respect of any Letter of Credit issued
hereunder, or

                        (ii) there shall be imposed on the Underlying Issuer or
the Lender Group any other condition regarding any Underlying Letter of Credit
or any Letter of Credit issued pursuant hereto;

and the result of the foregoing is to increase, directly or indirectly, the cost
to the Lender Group of issuing, making, guaranteeing, or maintaining any Letter
of Credit or to reduce the amount receivable in respect thereof by the Lender
Group, then, and in any such case, Agent may, at any time within a reasonable
period after the additional cost is incurred or the amount received is reduced,
notify Administrative Borrower, and Borrowers shall pay on demand such amounts
as Agent may specify to be necessary to compensate the Lender Group for such
additional cost or reduced receipt, together with interest on such amount from
the date of such demand until payment in full thereof at the rate then
applicable to Base Rate Loans hereunder. The determination by Agent of any
amount due pursuant to this Section, as set forth in a certificate setting forth
the calculation thereof in reasonable detail, shall, in the absence of manifest
or demonstrable error, be final and conclusive and binding on all of the parties
hereto.

         2.13     LIBOR Option.

                (a) Interest and Interest Payment Dates. In lieu of having
interest charged at the rate based upon the Base Rate, Borrowers shall have the
option (the "LIBOR Option") to have interest on all or a portion of the Advances
or the Term Loans be charged (whether at the time when made (unless otherwise
provided herein), upon conversion from a Base Rate Loan to a LIBOR Rate Loan, or
upon continuation of a LIBOR Rate Loan as a LIBOR Rate Loan) at a rate of
interest based upon the LIBOR Rate. Interest on LIBOR Rate Loans shall be
payable on the earliest of (i) the last day of the Interest Period applicable
thereto, (ii) the date on which all or any portion of the Obligations are
accelerated pursuant to the terms hereof, or (iii) the date on which this
Agreement is terminated pursuant to the terms hereof. On the last day of each
applicable Interest Period, unless Administrative Borrower properly has
exercised the LIBOR Option with respect thereto, the interest rate applicable to
such LIBOR Rate Loan automatically shall convert to the rate of interest then
applicable to Base Rate Loans of the same type hereunder. At any time that an
Event of Default has occurred and is continuing, Borrowers no longer shall have
the option to request that Advances or the Term Loans bear interest at a rate
based upon the LIBOR Rate and Agent shall have the right to convert the interest
rate on all outstanding LIBOR Rate Loans to the rate then applicable to Base
Rate Loans hereunder.

                (b) LIBOR Election.

                        (i) Administrative Borrower may, at any time and from
time to time, so long as no Event of Default has occurred and is continuing,
elect to exercise the LIBOR Option by notifying Agent prior to 11:00 a.m.
(California time) at least 3 Business Days prior to the commencement of the
proposed Interest Period (the "LIBOR Deadline"). Notice of Administrative
Borrower's election of the LIBOR Option for a permitted portion of the Advances
or the Term Loan and an Interest Period pursuant to this Section shall be made
by delivery to Agent of a LIBOR Notice received by Agent before the LIBOR
Deadline, or by telephonic notice received by Agent before the LIBOR Deadline
(to be confirmed by delivery to Agent of a LIBOR Notice received by Agent prior
to 5:00 p.m. (California time) on the same day). Promptly upon its receipt of
each such LIBOR Notice, Agent shall provide a copy thereof to each of the
affected Lenders.

                        (ii) Each LIBOR Notice shall be irrevocable and binding
on Borrowers. In connection with each LIBOR Rate Loan, each Borrower shall
indemnify, defend, and hold Agent and the Lenders harmless against any loss,
cost, or expense incurred by Agent or any Lender as a result of (A) the payment
of any principal of any LIBOR Rate Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (B) the conversion of any LIBOR Rate Loan other than on the last day
of the Interest Period applicable thereto, or (C) the failure to borrow,
convert, continue or prepay any LIBOR Rate Loan on the date specified in any
LIBOR Notice delivered pursuant hereto (such losses, costs, or expenses,

                                       18
<PAGE>

"Funding Losses"). Funding Losses shall, with respect to Agent or any Lender, be
deemed to equal the amount determined by Agent or such Lender to be the excess,
if any, of (1) the amount of interest that would have accrued on the principal
amount of such LIBOR Rate Loan had such event not occurred, at the LIBOR Rate
that would have been applicable thereto, for the period from the date of such
event to the last day of the then current Interest Period therefor (or, in the
case of a failure to borrow, convert, or continue, for the period that would
have been the Interest Period therefor), minus (2) the amount of interest that
would accrue on such principal amount for such period at the interest rate which
Agent or such Lender would be offered were it to be offered, at the commencement
of such period, Dollar deposits of a comparable amount and period in the London
interbank market. A certificate of Agent or a Lender delivered to Administrative
Borrower setting forth any amount or amounts that Agent or such Lender is
entitled to receive pursuant to this Section 2.13 shall be conclusive absent
manifest error.

                        (iii) Borrowers shall have not more than 5 LIBOR Rate
Loans in effect at any given time. Borrowers only may exercise the LIBOR Option
for LIBOR Rate Loans of at least $500,000 and integral multiples of $250,000 in
excess thereof.

                (c) Conversion. Borrowers may convert LIBOR Rate Loans to Base
Rate Loans at any time; provided, however, that in the event that LIBOR Rate
Loans are converted or prepaid on any date that is not the last day of the
Interest Period applicable thereto, including as a result of any automatic
prepayment through the required application by Agent of proceeds of Borrowers'
and their Subsidiaries' Collections in accordance with Section 2.4(b) or for any
other reason, including early termination of the term of this Agreement or
acceleration of all or any portion of the Obligations pursuant to the terms
hereof, each Borrower shall indemnify, defend, and hold Agent and the Lenders
and their Participants harmless against any and all Funding Losses in accordance
with Section 2.13 (b)(ii) above.

                (d) Special Provisions Applicable to LIBOR Rate.

                        (i) The LIBOR Rate may be adjusted by Agent with respect
to any Lender on a prospective basis to take into account any additional or
increased costs to such Lender of maintaining or obtaining any eurodollar
deposits or increased costs, in each case, due to changes in applicable law
occurring subsequent to the commencement of the then applicable Interest Period,
including changes in tax laws (except changes of general applicability in
corporate income tax laws) other than with respect to Excluded Taxes and changes
in the reserve requirements imposed by the Board of Governors of the Federal
Reserve System (or any successor), excluding the Reserve Percentage, which
additional or increased costs would increase the cost of funding or maintaining
loans bearing interest at the LIBOR Rate. In any such event, the affected Lender
shall give Administrative Borrower and Agent notice of such a determination and
adjustment and Agent promptly shall transmit the notice to each other Lender
and, upon its receipt of the notice from the affected Lender, Administrative
Borrower may, by notice to such affected Lender (y) require such Lender to
furnish to Administrative Borrower a statement setting forth the basis for
adjusting such LIBOR Rate and the method for determining the amount of such
adjustment, or (z) repay the LIBOR Rate Loans with respect to which such
adjustment is made (together with any amounts due under Section 2.13(b)(ii)).

                        (ii) In the event that any change in market conditions
or any law, regulation, treaty, or directive, or any change therein or in the
interpretation of application thereof, other than with respect to Excluded
Taxes, shall at any time after the date hereof, in the reasonable opinion of any
Lender, make it unlawful or impractical for such Lender to fund or maintain
LIBOR Rate Loans or to continue such funding or maintaining, or to determine or
charge interest rates at the LIBOR Rate, such Lender shall give notice of such
changed circumstances to Agent and Administrative Borrower and Agent promptly
shall transmit the notice to each other Lender and (y) in the case of any LIBOR
Rate Loans of such Lender that are outstanding, the date specified in such
Lender's notice shall be deemed to be the last day of the Interest Period of
such LIBOR Rate Loans, and interest upon the LIBOR Rate Loans of such Lender
thereafter shall accrue interest at the rate then applicable to Base Rate Loans,
and (z) Borrowers shall not be entitled to elect the LIBOR Option until such
Lender determines that it would no longer be unlawful or impractical to do so.

                                       19
<PAGE>

                (e) No Requirement of Matched Funding. Anything to the contrary
contained herein notwithstanding, neither Agent, nor any Lender, nor any of
their Participants, is required actually to acquire eurodollar deposits to fund
or otherwise match fund any Obligation as to which interest accrues at the LIBOR
Rate. The provisions of this Section shall apply as if each Lender or its
Participants had match funded any Obligation as to which interest is accruing at
the LIBOR Rate by acquiring eurodollar deposits for each Interest Period in the
amount of the LIBOR Rate Loans.

         2.14 Capital Requirements. If, after the date hereof, any Lender
determines that (i) the adoption of or change in any law, rule, regulation or
guideline regarding capital requirements for banks or bank holding companies, or
any change in the interpretation or application thereof by any Governmental
Authority charged with the administration thereof, or (ii) compliance by such
Lender or its parent bank holding company with any guideline, request or
directive of any such entity regarding capital adequacy (whether or not having
the force of law), has the effect of reducing the return on such Lender's or
such holding company's capital as a consequence of such Lender's Commitments
hereunder to a level below that which such Lender or such holding company could
have achieved but for such adoption, change, or compliance (taking into
consideration such Lender's or such holding company's then existing policies
with respect to capital adequacy and assuming the full utilization of such
entity's capital) by any amount deemed by such Lender to be material, then such
Lender may notify Administrative Borrower and Agent thereof. Following receipt
of such notice, Borrowers agree to pay such Lender on demand the amount of such
reduction of return of capital as and when such reduction is determined, payable
within 90 days after presentation by such Lender of a statement in the amount
and setting forth in reasonable detail such Lender's calculation thereof and the
assumptions upon which such calculation was based (which statement shall be
deemed true and correct absent manifest error). In determining such amount, such
Lender may use any reasonable averaging and attribution methods.

         2.15     Joint and Several Liability of Borrowers.

                (a) Each Borrower is accepting joint and several liability
hereunder and under the other Loan Documents in consideration of the financial
accommodations to be provided by the Lender Group under this Agreement, for the
mutual benefit, directly and indirectly, of each Borrower and in consideration
of the undertakings of the other Borrowers to accept joint and several liability
for the Obligations.

                (b) Each Borrower, jointly and severally, hereby irrevocably and
unconditionally accepts, not merely as a surety but also as a co-debtor, joint
and several liability with the other Borrowers, with respect to the payment and
performance of all of the Obligations (including, without limitation, any
Obligations arising under this Section 2.15), it being the intention of the
parties hereto that all the Obligations shall be the joint and several
obligations of each Borrower without preferences or distinction among them.

                (c) If and to the extent that any Borrower shall fail to make
any payment with respect to any of the Obligations as and when due or to perform
any of the Obligations in accordance with the terms thereof, then in each such
event the other Borrowers will make such payment with respect to, or perform,
such Obligation.

                (d) The Obligations of each Borrower under the provisions of
this Section 2.15 constitute the absolute and unconditional, full recourse
Obligations of each Borrower enforceable against each Borrower to the full
extent of its properties and assets, irrespective of the validity, regularity or
enforceability of this Agreement or any other circumstances whatsoever.

                (e) Except as otherwise expressly provided in this Agreement,
each Borrower hereby waives notice of acceptance of its joint and several
liability, notice of any Advances or Letters of Credit issued under or pursuant
to this Agreement, notice of the occurrence of any Default, Event of Default, or
of any demand for any payment under this Agreement, notice of any action at any
time taken or omitted by Agent or Lenders under or in respect of any of the
Obligations, any requirement of diligence or to mitigate damages and, generally,
to the extent permitted by applicable law, all demands, notices and other
formalities of every kind in connection with this Agreement (except as otherwise

                                       20
<PAGE>

provided in this Agreement). Each Borrower hereby assents to, and waives notice
of, any extension or postponement of the time for the payment of any of the
Obligations, the acceptance of any payment of any of the Obligations, the
acceptance of any partial payment thereon, any waiver, consent or other action
or acquiescence by Agent or Lenders at any time or times in respect of any
default by any Borrower in the performance or satisfaction of any term,
covenant, condition or provision of this Agreement, any and all other
indulgences whatsoever by Agent or Lenders in respect of any of the Obligations,
and the taking, addition, substitution or release, in whole or in part, at any
time or times, of any security for any of the Obligations or the addition,
substitution or release, in whole or in part, of any Borrower. Without limiting
the generality of the foregoing, each Borrower assents to any other action or
delay in acting or failure to act on the part of any Agent or Lender with
respect to the failure by any Borrower to comply with any of its respective
Obligations, including, without limitation, any failure strictly or diligently
to assert any right or to pursue any remedy or to comply fully with applicable
laws or regulations thereunder, which might, but for the provisions of this
Section 2.15 afford grounds for terminating, discharging or relieving any
Borrower, in whole or in part, from any of its Obligations under this Section
2.15, it being the intention of each Borrower that, so long as any of the
Obligations hereunder remain unsatisfied, the Obligations of each Borrower under
this Section 2.15 shall not be discharged except by performance and then only to
the extent of such performance. The Obligations of each Borrower under this
Section 2.15 shall not be diminished or rendered unenforceable by any winding
up, reorganization, arrangement, liquidation, reconstruction or similar
proceeding with respect to any Borrower or any Agent or Lender.

                (f) Each Borrower represents and warrants to Agent and Lenders
that such Borrower is currently informed of the financial condition of Borrowers
and of all other circumstances which a diligent inquiry would reveal and which
bear upon the risk of nonpayment of the Obligations. Each Borrower further
represents and warrants to Agent and Lenders that such Borrower has read and
understands the terms and conditions of the Loan Documents. Each Borrower hereby
covenants that such Borrower will continue to keep informed of Borrowers'
financial condition, the financial condition of other guarantors, if any, and of
all other circumstances which bear upon the risk of nonpayment or nonperformance
of the Obligations.

                (g) Each Borrower waives all rights and defenses arising out of
an election of remedies by Agent or any Lender, even though that election of
remedies, such as a nonjudicial foreclosure with respect to security for a
guaranteed obligation, has destroyed Agent's or such Lender's rights of
subrogation and reimbursement against such Borrower (including, if, for any
reason the laws of the State of California are applied to the Loan Documents,
subrogation rights have been destroyed by the operation of Section 580(d) of the
California Code of Civil Procedure or otherwise).

                (h) To the extent applicable, each Borrower waives all rights
and defenses that such Borrower may have because the Obligations are secured by
Real Property. This means, among other things:

                        (i) Agent and Lenders may collect from such Borrower
without first foreclosing on any Real or Personal Property Collateral pledged by
Borrowers.

                        (ii) If Agent or any Lender forecloses on any Real
Property Collateral pledged by Borrowers:

                                (A) The amount of the Obligations may be reduced
only by the price for which that collateral is sold at the foreclosure sale,
even if the collateral is worth more than the sale price, provided, however,
that nothing in this section shall limit Agent's requirement to conduct such
sale in a commercially reasonable manner to the extent required under Article 9
of the Code.

                                (B) Agent and Lenders may collect from such
Borrower even if Agent or Lenders, by foreclosing on the Real Property
Collateral, has destroyed any right such Borrower may have to collect from the
other Borrowers.

                                       21
<PAGE>

This is an unconditional and irrevocable waiver of any rights and defenses such
Borrower may have because the Obligations are secured by Real Property. These
rights and defenses include, but are not limited to, any rights or defenses
based upon Section 580a, 580b, 580d or 726 of the California Code of Civil
Procedure.

                (i) The provisions of this Section 2.15 are made for the benefit
of Agent, Lenders and their respective successors and assigns, and may be
enforced by it or them from time to time against any or all Borrowers as often
as occasion therefor may arise and without requirement on the part of Agent,
Lender, successor or assign first to marshal any of its or their claims or to
exercise any of its or their rights against any Borrower or to exhaust any
remedies available to it or them against any Borrower or to resort to any other
source or means of obtaining payment of any of the Obligations hereunder or to
elect any other remedy. The provisions of this Section 2.15 shall remain in
effect until all of the Obligations shall have been paid in full or otherwise
fully satisfied. If at any time, any payment, or any part thereof, made in
respect of any of the Obligations, is rescinded or must otherwise be restored or
returned by Agent or any Lender upon the insolvency, bankruptcy or
reorganization of any Borrower, or otherwise, the provisions of this Section
2.15 will forthwith be reinstated in effect, as though such payment had not been
made.

                (j) Each Borrower hereby agrees that it will not enforce any of
its rights of contribution or subrogation against any other Borrower with
respect to any liability incurred by it hereunder or under any of the other Loan
Documents, any payments made by it to Agent or Lenders with respect to any of
the Obligations or any collateral security therefor until such time as all of
the Obligations have been paid in full in cash. Any claim which any Borrower may
have against any other Borrower with respect to any payments to any Agent or
Lender hereunder or under any other Loan Documents are hereby expressly made
subordinate and junior in right of payment, without limitation as to any
increases in the Obligations arising hereunder or thereunder, to the prior
payment in full in cash of the Obligations and, in the event of any insolvency,
bankruptcy, receivership, liquidation, reorganization or other similar
proceeding under the laws of any jurisdiction relating to any Borrower, its
debts or its assets, whether voluntary or involuntary, all such Obligations
shall be paid in full in cash before any payment or distribution of any
character, whether in cash, securities or other property, shall be made to any
other Borrower therefor.

                (k) Each Borrower hereby agrees that, after the occurrence and
during the continuance of any Default or Event of Default, the payment of any
amounts due with respect to the indebtedness owing by any Borrower to any other
Borrower is hereby subordinated to the prior payment in full in cash of the
Obligations. Each Borrower hereby agrees that after the occurrence and during
the continuance of any Default or Event of Default, such Borrower will not
demand, sue for or otherwise attempt to collect any indebtedness of any other
Borrower owing to such Borrower until the Obligations shall have been paid in
full in cash. If, notwithstanding the foregoing sentence, such Borrower shall
collect, enforce or receive any amounts in respect of such indebtedness, such
amounts shall be collected, enforced and received by such Borrower as trustee
for Agent, and such Borrower shall deliver any such amounts to Agent for
application to the Obligations in accordance with Section 2.4(b).

                (l) Each Borrower hereby waives all rights by which such
Borrower might be entitled to require suit on an accrued right of action in
respect of any of the Obligations or require suit against any other Borrower or
any Guarantor or any other Person.

                (m) Each Borrower, to the extent permitted by applicable law,
waives any rights, benefits, and defenses that are or may become available to
such Borrower (including by reason of California Civil Code Sections 2845 and
2850), based on the claim that Agent is required to proceed against another
Borrower or any other Person, or to proceed against or exhaust any security held
by Agent at any time, or to first apply any security of any Borrower to the
discharge of the Obligations, or to pursue any other remedy in Agent's power
before proceeding against such Borrower hereunder.

                                       22
<PAGE>

                (n) Each Borrower, to the extent permitted by applicable law,
waives any and all rights, benefits and defenses (including by reason of
California Civil Code ss.2849), based on the claim that a surety is entitled to
the benefit of every security for the performance of the principal obligation
held by the creditor.

                (o) Each Borrower, to the extent permitted by applicable law,
waives any rights and defenses that are or may become available to such Borrower
by reason of California Civil Code Section 2856(a)(1)-(3), inclusive, which
includes, without limitation, any rights and defenses which are or may become
available to such Borrower by reason of California Civil Code Sections 2787 to
2855, inclusive.

                (p) Each Borrower, to the extent permitted by applicable law,
waives any right or defense it may have at law or equity, (including by reason
of California Code of Civil Procedure Section 580a), to require a fair market
value hearing or action to determine a deficiency judgment after a foreclosure.

                (q) Each Borrower, to the extent permitted by applicable law,
waives any rights, benefits, and defenses that are or may become available to
such Borrower to claim that, as a surety, (i) it is not liable if for certain
reasons there is no liability upon the part of the principal or if the principal
ceases to become liable (including by reason of California Civil Code Section
2809) and (ii) its obligations must not be larger nor more burdensome than that
of the principal (including by reason of California Civil Code Section 2810).

Any reference to California code sections shall be deemed to include any
equivalent code provisions under New York law. Without limiting the
applicability of the equivalent code provisions under New York law, the
foregoing references to the California Code of Civil Procedure and the
California Civil Code shall apply if, notwithstanding the provisions of Section
12, the laws of the State of California are applied to the Loan Documents;
provided, that the inclusion of such provisions does not affect or limit in any
way the parties' choice of New York law.

3.       CONDITIONS; TERM OF AGREEMENT.

         3.1 Conditions Precedent to the Initial Extension of Credit. The
obligation of each Lender to make its initial extension of credit provided for
hereunder, is subject to the fulfillment, to the satisfaction of Agent and each
Lender of each of the conditions precedent set forth on Schedule 3.1 (the making
of such initial extension of credit by a Lender being conclusively deemed to be
its satisfaction or waiver of the conditions precedent).

         3.2 Conditions Precedent to all Extensions of Credit. The obligation of
the Lender Group (or any member thereof) to make any Advances or any Term Loan
hereunder (or to extend any other credit hereunder) at any time shall be subject
to the following conditions precedent:

                (a) the representations and warranties contained in this
Agreement or in the other Loan Documents shall be true and correct in all
material respects (except 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) on and as of the date of such
extension of credit, as though made on and as of such date (except to the extent
that such representations and warranties relate solely to an earlier date);

                (b) no Default or Event of Default shall have occurred and be
continuing on the date of such extension of credit, nor shall either result from
the making thereof;

                (c) no injunction, writ, restraining order, or other order of
any nature restricting or prohibiting, directly or indirectly, the extending of
such credit shall have been issued and remain in force by any Governmental
Authority against any Borrower, Agent, or any Lender;

                (d) no Material Adverse Change shall have occurred since August
31, 2006;

                                       23
<PAGE>

                (e) each draw under Term Loan B hereunder shall be subject to
the following conditions precedent:

                        (i) Agent is in receipt of a third-party quality of
earnings audit in form and substance acceptable to Lenders;

                        (ii) Agent shall have received evidence satisfactory in
all respects to the Agent that such draw under Term Loan B is to be used by
Borrowers to finance a Permitted Acquisition;

                        (iii) Agent shall have received, and be satisfied with,
true and complete copies of all agreements to effect the Permitted Acquisition,
and any other documents reasonably requested by Agent in connection therewith,
to be financed with the proceeds of such draw under Term Loan B;

                        (iv) the proposed draw under Term Loan B is in an amount
not less than $1,000,000;

                        (v) any and all agreements, instruments and documents
(including, without limitation, financing statements) required to be executed,
delivered and/or filed in order to create, in favor of Agent, a first priority
fully perfected security interest (A) in the case of an asset purchase, in the
then existing and thereafter arising assets being purchased with the proceeds of
such draw and (B) in the case of a Stock purchase, the Stock and the then
existing and thereafter arising assets of such company being purchased with such
draw, in each case shall have been properly executed, delivered and/or filed in
each office in each jurisdiction necessary to create in favor of Agent a first
priority fully perfected security interest in such assets and/or Stock, and
Agent shall be satisfied, in its sole and absolute discretion, with the nature
and extent of the rights and remedies afforded Agent under applicable law;

                        (vi) this Agreement (including all financial covenants
and all other affirmative and negative covenants) shall have been amended as
Agent requires in its sole discretion to reflect the Permitted Acquisition and
the draw under Term Loan B and their impact on Borrowers' business, assets,
financial condition and prospects; and

                        (vii) Borrowers shall have delivered, and the Agent
shall have approved of, a certificate in connection with the Permitted
Acquisition to be financed with the proceeds of such draw under Term Loan B
reflecting that, on a pro forma basis before and after giving effect to such
acquisition, the sum of (i) the outstanding Advances, (ii) the unpaid balance of
Term Loan A, (iii) the unpaid balance of the Term Loan B, and (iv) the proposed
draw under Term Loan B will not exceed the product of the Acquisition Multiple
times the Pro Forma TTM EBITDA.

         3.3 Term. This Agreement shall continue in full force and effect for a
term ending on November 30, 2010 (the "Maturity Date"). The foregoing
notwithstanding, the Lender Group, upon the election of the Required Lenders,
shall have the right to terminate its obligations under this Agreement
immediately and without notice upon the occurrence and during the continuation
of an Event of Default.

         3.4 Effect of Termination. On the date of termination of this
Agreement, all Obligations (including contingent reimbursement obligations of
Borrowers with respect to outstanding Letters of Credit and including all Bank
Product Obligations) immediately shall become due and payable without notice or
demand (including (a) either (i) providing cash collateral to be held by Agent
for the benefit of those Lenders with a Revolver Commitment in an amount equal
to 105% of the Letter of Credit Usage, or (ii) causing the original Letters of
Credit to be returned to the Issuing Lender, (b) providing cash collateral (in
an amount determined by Agent as sufficient to satisfy the reasonably estimated
credit exposure) to be held by Agent for the benefit of the Bank Product
Providers with respect to the Bank Product Obligations, and (c) making adequate
provision for any contingent or unliquidated Obligations related to claims,
causes of action, or liabilities that have been asserted or threatened against
the Agent or Lenders, or that otherwise can be reasonably identified based on
the then known

                                       24
<PAGE>

facts and circumstances). No termination of this Agreement, however, shall
relieve or discharge Borrowers or their Subsidiaries of their duties,
Obligations, or covenants hereunder or under any other Loan Document and the
Agent's Liens in the Collateral shall remain in effect until all Obligations
have been paid in full and the Lender Group's obligations to provide additional
credit hereunder have been terminated. When this Agreement has been terminated
and all of the Obligations have been paid in full and the Lender Group's
obligations to provide additional credit under the Loan Documents have been
terminated irrevocably, Agent will, at Borrowers' sole expense, execute and
deliver any termination statements, lien releases, mortgage releases,
re-assignments of trademarks, discharges of security interests, and other
similar discharge or release documents (and, if applicable, in recordable form)
as are reasonably necessary to release, as of record, the Agent's Liens and all
notices of security interests and liens previously filed by Agent with respect
to the Obligations.

         3.5 Early Termination by Borrowers. Borrowers have the option, at any
time upon 60 days prior written notice by Administrative Borrower to Agent, to
terminate this Agreement and terminate the Commitments hereunder by paying to
Agent, in cash, the sum of the full amount of the Obligations (including (a)
either (i) providing cash collateral to be held by Agent for the benefit of
those Lenders with a Revolver Commitment in an amount equal to 105% of the
Letter of Credit Usage, or (ii) causing the original Letters of Credit to be
returned to the Issuing Lender, (b) providing cash collateral (in an amount
determined by Agent as sufficient to satisfy the reasonably estimated credit
exposure) to be held by Agent for the benefit of the Bank Product Providers with
respect to the Bank Product Obligations, and (c) making adequate provision for
any contingent or unliquidated Obligations related to claims, causes of action,
or liabilities that have been asserted or threatened against the Agent or
Lenders, or that otherwise can be reasonably identified based on the then known
facts and circumstances), and the otherwise applicable Early Termination Fee. If
Administrative Borrower has sent a notice of termination pursuant to the
provisions of this Section, then the Commitments shall terminate and Borrowers
shall be obligated to repay the Obligations (including (a) either (i) providing
cash collateral to be held by Agent for the benefit of those Lenders with a
Revolver Commitment in an amount equal to 105% of the Letter of Credit Usage, or
(ii) causing the original Letters of Credit to be returned to the Issuing
Lender, (b) providing cash collateral (in an amount determined by Agent as
sufficient to satisfy the reasonably estimated credit exposure) to be held by
Agent for the benefit of the Bank Product Providers with respect to the Bank
Product Obligations, and (c) making adequate provision for any contingent or
unliquidated Obligations related to claims, causes of action, or liabilities
that have been asserted or threatened against the Agent or Lenders, or that
otherwise can be reasonably identified based on the then known facts and
circumstances), in full, together with the Early Termination Fee, on the date
set forth as the date of termination of this Agreement in such notice.

4.       REPRESENTATIONS AND WARRANTIES.

                  In order to induce the Lender Group to enter into this
Agreement, each Borrower makes the following representations and warranties to
the Lender Group which shall be true, correct, and complete, in all material
respects, as of the date hereof, and shall be true, correct, and complete, in
all material respects, as of the Closing Date, and at and as of the date of the
making of each Advance or Term Loan (or other extension of credit) made
thereafter, as though made on and as of the date of such Advance or Term Loan
(or other extension of credit) (except to the extent that such representations
and warranties relate solely to an earlier date) and such representations and
warranties shall survive the execution and delivery of this Agreement:

         4.1 No Encumbrances. Each Borrower and its Subsidiaries has good and
indefeasible title to, or a valid leasehold interest in, their personal property
assets and good and marketable title to, or a valid leasehold interest in, their
Real Property, in each case, free and clear of Liens except for Permitted Liens.

         4.2 Healthcare Matters.

                                       25
<PAGE>

                (a) Each Borrower and its respective Subsidiaries (i) has all
material permits, licenses, accreditations, certifications, authorizations,
approvals, consents and agreements of all Payors, accreditation agencies and any
other Person(s), necessary or required for each Borrower or such Subsidiary to
own the assets that it now owns, to carry on its business as now conducted, to
execute, deliver and perform its Obligations under the Loan Documents, and to
receive payments on Accounts from the applicable Payors, and (ii) is in
compliance with all laws, rules, regulations, orders, decrees and directions of
any Governmental Authority (including, without limitation, the Medicare Act, the
rules and regulations of HCFA under the Medicare Act, the applicable Medicaid
laws and HIPAA) applicable to the Accounts or any contracts relating thereto, or
applicable to the business and properties of any Borrower or such Subsidiary, a
violation of which would or could materially and adversely affect the ability of
any Borrower or such Subsidiary to carry out its Obligations hereunder or with
respect to the Accounts. Except as has been disclosed to Agent in writing prior
to the Closing Date, no Borrower or any of their respective Subsidiaries has
been notified by any such Payor, accreditation agency or any other Person,
during the 24 month period immediately preceding the date of this Agreement,
that such Person has rescinded or not renewed, or intends to rescind or not
renew, any such permit, license, accreditation, certification, authorization,
approval, consent or agreement granted by it to any Borrower or to which it and
any Borrower or such Subsidiary are parties. Without limiting the generality of
the foregoing, to Borrowers' and each of Borrowers' Subsidiaries' knowledge,
there have not been, and there currently are no pending licensure,
certification, or other enforcement actions by the Centers for Medicare and
Medicaid Services. To Borrowers' and each of Borrowers' Subsidiaries' knowledge,
if Borrowers and their respective Subsidiaries were surveyed for compliance with
relevant licensing criteria, Borrowers and such Subsidiaries would be found to
be in substantial compliance with such requirements, sufficient to maintain
their respective license and Medicare certifications.

                (b) None of the Borrowers maintains Medicare provider or
Medicaid provider status nor is any Borrower required to maintain any such
status to carry on its business as now conducted or to carry out its Obligations
hereunder. Schedule 4.2(b) contains, as of the Closing Date, the respective
provider identification numbers of each physician to whom any Borrower provides
billing, practice management or related services. The Borrowers shall provide
Agent with an updated Schedule 4.2(b) as promptly as possible and in any event
within twenty-five (25) days following Agent's request therefor; provided that,
in the absence of a Default or Event of Default, the Borrowers will not be
required to update Schedule 4.2(b) more frequently than twice per calendar year.

                (c) No Borrower or any of their respective Subsidiaries is
required to be accredited by JCAHO. Each Borrower and each of their respective
Subsidiaries is in good standing with the respective governmental,
quasi-governmental and other third party Payors and regulatory agencies that now
or hereafter are expected to deal with each such Borrower or such Subsidiaries.

                (d) To Borrowers' and each of their respective Subsidiaries'
knowledge, no Borrower or any such Subsidiary has committed any act that has
been or may be deemed an "unlawful act" in violation of or has ever been
notified that it is subject to any suspension or revocation action, or the
subject of any investigation, civil investigative demand, or action.

                (e) To Borrowers' and each of their respective Subsidiaries'
knowledge, no Borrower or such Subsidiary has presented or caused to be
presented any claim that is in violation of law.

                (f) To Borrowers' and each of their respective Subsidiaries'
knowledge, no Borrower or such Subsidiary has submitted any claim for payment
that violates the federal False Claims Act, as codified at 31 U.S.C. ss. 3729.

                (g) No Borrower or any of their respective Subsidiaries, nor any
director, officer, nor to Borrowers' or such Subsidiaries' knowledge, any
employee of any Borrower or such Subsidiary, nor any manager or agent acting on
behalf of or for the benefit thereof, has directly or indirectly solicited,
received, paid or offered to pay any illegal remuneration in violation of the
Medicare and Medicaid Anti-Kickback Statute, as codified at 42 U.S.C. ss.
1320a-7b(b).

                                       26
<PAGE>

                (h) No Borrower or any of their respective Subsidiaries, nor any
director, officer, nor to Borrowers' or such Subsidiaries' knowledge, any
employee of any Borrower or such Subsidiary, have been convicted of or indicted
for a Medicare, Medicaid or other Federal health care program (as defined in 42
U.S.C. ss. 1320a-7b(f)) offense, or convicted of or indicted for a violation of
federal or state law related to fraud, theft, embezzlement, breach of fiduciary
responsibility, financial misconduct, obstruction of an investigation, or a
crime involving controlled substances, nor have they been debarred, excluded or
suspended from participation in any Medicare, Medicaid or any other Federal
health care program, or been subject to any order or consent decree of, or
criminal or civil fine or penalty imposed by, any court or governmental agency.
At no time during the conduct of Borrowers' or their respective Subsidiaries'
business has any Borrower or such Subsidiary arranged or contracted with (by
employment or otherwise) any individual or entity excluded or suspended from
participation in a Federal health care program for the provision of items or
services for which payment may be made under such Federal health care program.

                (i) No Borrower or any of their respective Subsidiaries (or any
executive officer or manager of any of them):

                        (i) has had a civil monetary penalty assessed against
any of them under the Social Security Act ("SSA") Section 1128(a);

                        (ii) has been excluded from participation under the
Medicare program or under a State health care program as defined in SSA Section
1128(h) ("State Health Care Program"); or

                        (iii) has been convicted (as that term is defined in 42
C.F.R. Section 1001.2) of any of the following categories of offenses as
described in SSA Section 1127(a) and (b)(1), (2), or (3); (A) criminal offenses
relating to the delivery of an item or service under Medicare or any State
Health Care Program; (B) criminal offenses under federal or state law relating
to patient neglect or abuse in connection with the delivery of a health care
item or service; (C) criminal offenses under federal or state law relating to
fraud, theft, embezzlement, breach of fiduciary responsibility, or other
financial misconduct in connection with the delivery of a health care item or
service or with respect to any act or omission in a program operated by or
financed in whole or in part by any federal, state or local governmental agency;
(D) federal or state laws relating to the interference with or obstruction of
any investigations into any criminal offenses described in clauses (A) through
(C) above; or (E) criminal offenses under federal or state law relating to the
unlawful manufacture, distribution, prescription or dispensing of a controlled
substance.

         4.3 Equipment. Each material item of Equipment of Borrowers and their
Subsidiaries is used or held for use in their business and is in good working
order, ordinary wear and tear and damage by casualty excepted.

         4.4 Location of Inventory and Equipment. The Inventory and Equipment
(other than vehicles or Equipment out for repair) of Borrowers and their
Subsidiaries are not stored with a bailee, warehouseman, or similar party and
are located only at, or in-transit between, the locations identified on Schedule
4.4 (as such Schedule may be updated pursuant to Section 5.9).

         4.5 Inventory Records. Each Borrower keeps correct and accurate records
itemizing and describing the type, quality, and quantity of its and its
Subsidiaries' Inventory and the book value thereof.

         4.6 Jurisdiction of Organization;  Location of Chief Executive Office;
Organizational Identification Number; Commercial Tort Claims.

                (a) The name of (within the meaning of Section 9-503 of the
Code) and jurisdiction of organization of each Borrower and each of its
Subsidiaries is set forth on Schedule 4.6(a) (as such Schedule may be updated
from time to time to reflect changes permitted to be made under Section 6.5).

                                       27
<PAGE>

                (b) The chief executive office of each Borrower and each of its
Subsidiaries is located at the address indicated on Schedule 4.6(b) (as such
Schedule may be updated from time to time to reflect changes permitted to be
made under Section 5.9).

                (c) Each Borrower's and each of its Subsidiaries' tax
identification numbers and each Borrower's and each of its Subsidiaries' (other
than the Shell Entities) organizational identification numbers, if any, are
identified on Schedule 4.6(c) (as such Schedule may be updated from time to time
to reflect changes permitted to be made under Section 6.5).

                (d) As of the Closing Date, Borrowers and their Subsidiaries do
not hold any commercial tort claims, except as set forth on Schedule 4.6(d).

         4.7 Due Organization and Qualification; Subsidiaries.

                (a) Each Borrower is duly organized and existing and in good
standing under the laws of the jurisdiction of its organization and qualified to
do business in any state where the failure to be so qualified reasonably could
be expected to result in a Material Adverse Change.

                (b) Set forth on Schedule 4.7(b) (as such Schedule may be
updated from time to time to reflect changes permitted to be made under Section
5.16), is a complete and accurate description of the authorized capital Stock of
each Borrower, by class, and, as of the Closing Date, a description of the
number of shares of each such class that are issued and outstanding. Other than
as described on Schedule 4.7(b), there are no subscriptions, options, warrants,
or calls relating to any shares of each Borrower's capital Stock, including any
right of conversion or exchange under any outstanding security or other
instrument. Other than as described on Schedule 4.7(b), no Borrower is subject
to any obligation (contingent or otherwise) to repurchase or otherwise acquire
or retire any shares of its capital Stock or any security convertible into or
exchangeable for any of its capital Stock.

                (c) Set forth on Schedule 4.7(c) (as such Schedule may be
updated from time to time to reflect changes permitted to be made under Section
5.16), is a complete and accurate list of each Borrower's direct and indirect
Subsidiaries, showing: (i) the jurisdiction of their organization, (ii) other
than the Shell Entities, the number of shares of each class of common and
preferred Stock authorized for each of such Subsidiary, and (iii) other than the
Shell Entities, the number and the percentage of the outstanding shares of each
such class owned directly or indirectly by the applicable Borrower. All of the
outstanding capital Stock of each such Subsidiary has been validly issued and is
fully paid and non-assessable.

                (d) Except as set forth on Schedule 4.7(c), there are no
subscriptions, options, warrants, or calls relating to any shares of any
Borrower's Subsidiaries' capital Stock, including any right of conversion or
exchange under any outstanding security or other instrument. No Borrower or any
of its respective Subsidiaries is subject to any obligation (contingent or
otherwise) to repurchase or otherwise acquire or retire any shares of any
Borrower's Subsidiaries' capital Stock or any security convertible into or
exchangeable for any such capital Stock.

         4.8 Due Authorization; No Conflict.

                (a) As to each Borrower, the execution, delivery, and
performance by such Borrower of this Agreement and the Loan Documents to which
it is a party have been duly authorized by all necessary action on the part of
such Borrower.

                (b) As to each Borrower, the execution, delivery, and
performance by such Borrower of this Agreement and the other Loan Documents to
which it is a party do not and will not (i) violate in any material respect any
provision of federal, state, or local law or regulation applicable to any
Borrower, the Governing Documents of any Borrower, or any order, judgment, or
decree of any court or other Governmental Authority binding on any Borrower,

                                       28
<PAGE>

(ii) conflict with, result in a breach of, or constitute (with due notice or
lapse of time or both) a default under any material contractual obligation of
any Borrower, (iii) result in or require the creation or imposition of any Lien
of any nature whatsoever upon any properties or assets of Borrower, other than
Permitted Liens, or (iv) require any approval of any Borrower's interestholders
or any approval or consent of any Person under any material contractual
obligation of any Borrower, other than consents or approvals that have been
obtained and that are still in force and effect.

                (c) Other than the filing of financing statements, and other
filings or actions necessary to perfect Liens granted to Agent in the
Collateral, the execution, delivery, and performance by each Borrower of this
Agreement and the other Loan Documents to which such Borrower is a party do not
and will not require any registration with, consent, or approval of, or notice
to, or other action with or by, any Governmental Authority, other than consents
or approvals that have been obtained and that are still in force and effect.

                (d) As to each Borrower, this Agreement and the other Loan
Documents to which such Borrower is a party, and all other documents
contemplated hereby and thereby, when executed and delivered by such Borrower
will be the legally valid and binding obligations of such Borrower, enforceable
against such Borrower in accordance with their respective terms, except as
enforcement may be limited by equitable principles or by bankruptcy, insolvency,
reorganization, moratorium, or similar laws relating to or limiting creditors'
rights generally.

                (e) The Agent's Liens are validly created, perfected (other than
(i) in respect of motor vehicles and (ii) any Deposit Accounts and Securities
Accounts not subject to a Control Agreement as permitted by Section 6.12, and
subject only to the filing of financing statements and the recordation of the
Mortgages), and first priority Liens, subject only to Permitted Liens.

                (f) The execution, delivery, and performance by each Guarantor
of the Loan Documents to which it is a party have been duly authorized by all
necessary action on the part of such Guarantor.

                (g) The execution, delivery, and performance by each Guarantor
of the Loan Documents to which it is a party do not and will not (i) violate in
any material respect any provision of federal, state, or local law or regulation
applicable to such Guarantor, the Governing Documents of such Guarantor, or any
order, judgment, or decree of any court or other Governmental Authority binding
on such Guarantor, (ii) conflict with, result in a breach of, or constitute
(with due notice or lapse of time or both) a default under any material
contractual obligation of such Guarantor, (iii) result in or require the
creation or imposition of any Lien of any nature whatsoever upon any properties
or assets of such Guarantor, other than Permitted Liens, or (iv) require any
approval of such Guarantor's interestholders or any approval or consent of any
Person under any material contractual obligation of such Guarantor, other than
consents or approvals that have been obtained and that are still in force and
effect.

                (h) Other than the filing of financing statements, and other
filings or actions necessary to perfect Liens granted to Agent in the
Collateral, the execution, delivery, and performance by each Guarantor of the
Loan Documents to which such Guarantor is a party do not and will not require
any registration with, consent, or approval of, or notice to, or other action
with or by, any Governmental Authority, other than consents or approvals that
have been obtained and that are still in force and effect.

                (i) The Loan Documents to which each Guarantor is a party, and
all other documents contemplated hereby and thereby, when executed and delivered
by such Guarantor will be the legally valid and binding obligations of such
Guarantor, enforceable against such Guarantor in accordance with their
respective terms, except as enforcement may be limited by equitable principles
or by bankruptcy, insolvency, reorganization, moratorium, or similar laws
relating to or limiting creditors' rights generally.

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<PAGE>

         4.9 Litigation. Other than those matters disclosed on Schedule 4.9 and
other than matters arising after the Closing Date that reasonably could not be
expected to result in a Material Adverse Change, there are no actions, suits, or
proceedings pending or, to the best knowledge of each Borrower, threatened
against any Borrower or any of its Subsidiaries.

         4.10 No Material Adverse Change. All financial statements relating to
Borrowers and their Subsidiaries that have been delivered by Borrowers to the
Lender Group have been prepared in accordance with GAAP (except, in the case of
unaudited financial statements, for the lack of footnotes and being subject to
year-end audit adjustments and, in the case of Rand Medical Billing, Inc.,
On-Line Alternatives, Inc., and On Line Payroll Services, Inc, were prepared on
a cash, not accrual, basis) and present fairly in all material respects,
Borrowers' and their Subsidiaries' financial condition as of the date thereof
and results of operations for the period then ended. There has not been a
Material Adverse Change with respect to Borrowers and their Subsidiaries since
August 31, 2006.

         4.11 Fraudulent Transfer.

                (a) Each Borrower, other than Parent, and each Subsidiary of a
Borrower is Solvent.

                (b) Parent, on a consolidated basis, is Solvent.

                (c) No transfer of property is being made by any Borrower or any
Subsidiary of a Borrower and no obligation is being incurred by any Borrower or
any Subsidiary of a Borrower in connection with the transactions contemplated by
this Agreement or the other Loan Documents with the intent to hinder, delay, or
defraud either present or future creditors of Borrowers or their Subsidiaries.

         4.12 Employee  Benefits.  None of  Borrowers,  any of  their
Subsidiaries,  or any of their  ERISA  Affiliates maintains or contributes to
any Benefit Plan.

         4.13 Environmental Condition. Except as set forth on Schedule 4.13, (a)
to Borrowers' knowledge, none of Borrowers' or their Subsidiaries' properties or
assets has ever been used by Borrowers, their Subsidiaries, or by previous
owners or operators in the disposal of, or to produce, store, handle, treat,
release, or transport, any Hazardous Materials, where such use, production,
storage, handling, treatment, release or transport was in violation, in any
material respect, of any applicable Environmental Law, (b) to Borrowers'
knowledge, none of Borrowers' nor their Subsidiaries' properties or assets has
ever been designated or identified pursuant to and in violation of any
applicable Environmental Law as a Hazardous Materials disposal site, (c) none of
Borrowers nor any of their Subsidiaries have received notice that a Lien arising
under any Environmental Law has attached to any revenues or to any Real Property
owned or operated by Borrowers or their Subsidiaries, and (d) none of Borrowers
nor any of their Subsidiaries have received a summons, citation, notice, or
directive from the United States Environmental Protection Agency or any other
federal or state governmental agency concerning any action or omission by any
Borrower or any Subsidiary of a Borrower resulting in the releasing or disposing
of Hazardous Materials into the environment in material violation of any
applicable Environmental Laws.

         4.14 Intellectual Property. Each Borrower and each Subsidiary of a
Borrower owns, or holds licenses in, all material trademarks, trade names,
copyrights, patents, patent rights, and licenses that are necessary to the
conduct of its business as currently conducted, and attached hereto as Schedule
4.14 (as updated from time to time) is a true, correct, and complete listing of
all material patents, patent applications, trademarks, trademark applications,
copyrights, and copyright registrations as to which each Borrower or one of its
Subsidiaries is the owner or is an exclusive licensee; provided, however, that
Borrowers may amend Schedule 4.14 to add additional property so long as such
amendment occurs by written notice to Agent not less than 10 days before the
date on which a Borrower or any Subsidiary of Borrower acquires any such
property after the Closing Date.

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<PAGE>

         4.15 Leases. Borrowers and their Subsidiaries enjoy peaceful and
undisturbed possession under all leases material to their business and to which
they are parties or under which they are operating and all of such material
leases are valid and subsisting and no material default by Borrowers or their
Subsidiaries exists under any of them.

         4.16 Deposit Accounts and Securities Accounts. Set forth on Schedule
4.16 is a listing of all of Borrowers' and their Subsidiaries' Deposit Accounts
and Securities Accounts, including, with respect to each bank or securities
intermediary (a) the name and address of such Person, and (b) the account
numbers of the Deposit Accounts or Securities Accounts maintained with such
Person.

         4.17 Complete Disclosure. All factual information (taken as a whole)
furnished by or on behalf of Borrowers or their Subsidiaries in writing to Agent
or any Lender (including all information contained in the Schedules hereto or in
the other Loan Documents) for purposes of or in connection with this Agreement,
the other Loan Documents, or any transaction contemplated herein or therein is,
and all other such factual information (taken as a whole) hereafter furnished by
or on behalf of Borrowers or their Subsidiaries in writing to Agent or any
Lender will be, true and accurate in all material respects on the date as of
which such information is dated or certified and not incomplete by omitting to
state any fact necessary to make such information (taken as a whole) not
misleading in any material respect at such time in light of the circumstances
under which such information was provided. On the Closing Date, the Closing Date
Projections represent, and as of the date on which any other Projections are
delivered to Agent, such additional Projections represent Borrowers' good faith
estimate of their and their Subsidiaries' future performance for the periods
covered thereby based upon assumptions believed by Borrowers to be reasonable at
the time of the delivery thereof to Agent (it being understood that such
projections and forecasts are subject to uncertainties and contingencies, many
of which are beyond the control of Borrowers and their Subsidiaries and no
assurances can be given that such projections or forecasts will be realized).

         4.18 Indebtedness. Set forth on Schedule 4.18 is a true and complete
list of all Indebtedness of each Borrower and each Subsidiary of a Borrower
outstanding immediately prior to the Closing Date that is to remain outstanding
after the Closing Date and such Schedule accurately sets forth the aggregate
principal amount of such Indebtedness and the principal terms thereof.

         4.19 Shell Entities. As of the Closing Date, none of the Shell Entities
has any business operations, owns any material assets or has any material
liabilities.

         4.20 Rand Accounts. As of the Closing Date, none of Rand's accounts
payable is more than thirty (30) days past due.

         4.21 Commerce  Bank.  As of the Closing  Date,  no amounts are owing by
Rand to either First  Commerce  Bank or Bankers/Softech.

5.       AFFIRMATIVE COVENANTS.

                  Each Borrower covenants and agrees that, until termination of
all of the Commitments and payment in full of the Obligations, Borrowers shall
and shall cause each of their respective Subsidiaries (including the Shell
Entities solely with respect to Sections 5.7 and 5.10) to do all of the
following:

         5.1 Accounting System. Maintain a system of accounting that enables
Borrowers to produce financial statements in accordance with GAAP and maintain
records pertaining to the Collateral that contain information as from time to
time reasonably may be requested by Agent. Borrowers also shall keep a reporting
system that shows all additions, sales, claims, returns, and allowances with
respect to their and their Subsidiaries' sales.

         5.2 Collateral Reporting. Provide Agent (and if so requested by Agent,
with copies for each Lender) with each of the reports set forth on Schedule 5.2
at the times specified therein.

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<PAGE>

         5.3 Financial Statements, Reports, Certificates. Deliver to Agent, with
copies to each Lender, each of the financial statements, reports, or other items
set forth on Schedule 5.3 at the times specified therein. In addition, Parent
agrees that no Subsidiary of Parent will have a fiscal year different from that
of Parent.

         5.4 Guarantor Reports. Cause each Guarantor to deliver its annual
financial statements at the time when Parent provides its audited financial
statements to Agent, but only to the extent such Guarantor's financial
statements are not consolidated with Parent's financial statements.

         5.5 Inspection. Permit Agent, each Lender, and each of their duly
authorized representatives or agents to visit any of its properties and inspect
any of its assets or books and records, to examine and make copies of its books
and records, and to discuss its affairs, finances, and accounts with, and to be
advised as to the same by, its officers and employees at such reasonable times
and intervals as Agent or any such Lender may designate and, so long as no
Default or Event of Default exists, with reasonable prior notice to
Administrative Borrower.

         5.6 Maintenance of Properties. Maintain and preserve all of their
properties which are necessary or useful in the proper conduct of their business
in good working order and condition, ordinary wear, tear, and casualty excepted
(and except where the failure to do so could not be expected to result in a
Material Adverse Change), and comply at all times with the provisions of all
material leases to which it is a party as lessee, so as to prevent any loss or
forfeiture thereof or thereunder.

         5.7 Taxes. Cause all assessments and taxes, whether real, personal, or
otherwise, due or payable by, or imposed, levied, or assessed against Borrowers,
their Subsidiaries, or any of their respective assets to be paid in full, before
delinquency or before the expiration of any extension period, except to the
extent that the validity of such assessment or tax shall be the subject of a
Permitted Protest. Borrowers will and will cause their Subsidiaries to make
timely payment or deposit of all tax payments and withholding taxes required of
them by applicable laws, including those laws concerning F.I.C.A., F.U.T.A.,
state disability, and local, state, and federal income taxes, and will, upon
request, furnish Agent with proof satisfactory to Agent indicating that the
applicable Borrower or Subsidiary of a Borrower has made such payments or
deposits.

         5.8 Insurance.

                (a) At Borrowers' expense, maintain insurance respecting their
and their Subsidiaries' assets wherever located, covering loss or damage by
fire, theft, explosion, and all other hazards and risks as ordinarily are
insured against by other Persons engaged in the same or similar businesses.
Borrowers also shall maintain business interruption, public liability, and
product liability insurance, as well as insurance against larceny, embezzlement,
and criminal misappropriation. All such policies of insurance shall be in such
amounts and with such insurance companies as are reasonably satisfactory to
Agent. Borrowers shall deliver binders and, if requested by Agent, copies of all
such policies to Agent with an endorsement naming Agent as the sole loss payee
(under a satisfactory lender's loss payable endorsement) or additional insured,
as appropriate. Each policy of insurance or endorsement shall contain a clause
requiring the insurer to give not less than 30 days prior written notice to
Agent in the event of cancellation of the policy for any reason whatsoever.

                (b) Administrative Borrower shall give Agent prompt notice of
any loss exceeding $250,000 covered by such insurance. So long as no Event of
Default has occurred and is continuing, Borrowers shall have the exclusive right
to adjust any losses payable under any such insurance policies which are less
than $250,000. Following the occurrence and during the continuation of an Event
of Default, or in the case of any losses payable under such insurance exceeding
$250,000, Agent shall have the exclusive right to adjust any losses payable
under any such insurance policies, without any liability to Borrowers whatsoever
in respect of such adjustments.

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<PAGE>

         5.9 Location of Inventory and Equipment. Keep Borrowers' and their
Subsidiaries' Inventory and Equipment (other than vehicles and Equipment out for
repair) only at the locations identified on Schedule 4.5 and their chief
executive offices only at the locations identified on Schedule 4.6(b); provided,
however, that Administrative Borrower may amend Schedule 4.4 or Schedule 4.6 so
long as such amendment occurs by written notice to Agent not less than 30 days
prior to the date on which such Inventory or Equipment is moved to such new
location or such chief executive office is relocated, so long as such new
location is within the continental United States, and so long as, at the time of
such written notification, the applicable Borrower provides Agent a Collateral
Access Agreement with respect thereto.

         5.10 Compliance with Laws. Comply with the requirements of all
applicable laws, rules, regulations, and orders of any Governmental Authority,
other than laws, rules, regulations, and orders the non-compliance with which,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Change.

         5.11 Leases. Pay when due all rents and other amounts payable under any
material leases to which any Borrower or any Subsidiary of a Borrower is a party
or by which any Borrower's or any of its Subsidiaries' properties and assets are
bound, unless such payments are the subject of a Permitted Protest.

         5.12 Existence. At all times preserve and keep in full force and effect
each Borrower's and each of its Subsidiaries', valid existence and good standing
and, except as could not reasonably be expected to result in a Material Adverse
Change, any rights, franchises, permits, licenses, accreditations,
authorizations, or other approvals material to their businesses.

         5.13 Environmental.

                (a) Keep any property either owned or operated by any Borrower
or any Subsidiary of a Borrower free of any Environmental Liens or post bonds or
other financial assurances sufficient to satisfy the obligations or liability
evidenced by such Environmental Liens, (b) comply, in all material respects,
with Environmental Laws and provide to Agent documentation of such compliance
which Agent reasonably requests, (c) promptly notify Agent of any release of a
Hazardous Material in violation of Environmental Laws from or onto property
owned or operated by any Borrower or any Subsidiary of a Borrower and take any
Remedial Actions required to abate said release and come into compliance with
applicable Environmental Law, and (d) promptly, but in any event within 5 days
of its receipt thereof, provide Agent with written notice of any of the
following: (i) notice that an Environmental Lien has been filed against any of
the real or personal property of any Borrower or any Subsidiary of a Borrower,
(ii) commencement of any Environmental Action or notice that an Environmental
Action will be filed against any Borrower or any Subsidiary of a Borrower, and
(iii) notice of a violation, citation, or other administrative order which
reasonably could be expected to result in a Material Adverse Change.

         5.14 Disclosure Updates. Promptly and in no event later than 5 Business
Days after obtaining knowledge thereof, notify Agent if any written information,
exhibit, or report furnished to the Lender Group contained, at the time it was
furnished, any untrue statement of a material fact or omitted to state any
material fact necessary to make the statements contained therein not misleading
in light of the circumstances in which made. The foregoing to the contrary
notwithstanding, any notification pursuant to the foregoing provision will not
cure or remedy the effect of the prior untrue statement of a material fact or
omission of any material fact nor shall any such notification have the effect of
amending or modifying this Agreement or any of the Schedules hereto.

         5.15 Control Agreements. Take all reasonable steps in order for Agent
to obtain control in accordance with Sections 8-106, 9-104, 9-105, 9-106, and
9-107 of the Code with respect to (subject to the proviso contained in Section
6.12) all of its Securities Accounts, Deposit Accounts, electronic chattel
paper, investment property, and letter-of-credit rights.

                                       33
<PAGE>

         5.16 Formation of Subsidiaries. At the time that any Borrower or any
Guarantor forms any direct or indirect Subsidiary or acquires any direct or
indirect Subsidiary after the Closing Date, such Borrower or such Guarantor
shall (a) cause such new Subsidiary to provide to Agent a joinder to this
Agreement and the Guaranty and the Security Agreement, as Agent may require in
its discretion, together with such other security documents (including Mortgages
with respect to any Real Property of such new Subsidiary), as well as
appropriate financing statements (and with respect to all property subject to a
Mortgage, fixture filings), all in form and substance satisfactory to Agent
(including being sufficient to grant Agent a first priority Lien (subject to
Permitted Liens) in and to the assets of such newly formed or acquired
Subsidiary), (b) provide to Agent a pledge agreement and appropriate
certificates and powers or financing statements, hypothecating all of the direct
or beneficial ownership interest in such new Subsidiary, in form and substance
satisfactory to Agent, and (c) provide to Agent all other documentation,
including one or more opinions of counsel satisfactory to Agent, which in its
opinion is appropriate with respect to the execution and delivery of the
applicable documentation referred to above (including policies of title
insurance or other documentation with respect to all property subject to a
Mortgage). Any document, agreement, or instrument executed or issued pursuant to
this Section 5.16 shall be a Loan Document.

         5.17 Further Assurances. At any time upon the request of Agent,
Borrowers shall execute or deliver to Agent, and shall cause their Subsidiaries
to execute or deliver to Agent, any and all financing statements, fixture
filings, security agreements, pledges, assignments, endorsements of certificates
of title, mortgages, deeds of trust, opinions of counsel, and all other
documents (collectively, the "Additional Documents") that Agent may request in
form and substance reasonably satisfactory to Agent, to create, perfect, and
continue perfected or to better perfect the Agent's Liens in all of the
properties and assets of Borrowers and their Subsidiaries (whether now owned or
hereafter arising or acquired, tangible or intangible, real or personal), to
create and perfect Liens in favor of Agent in any Real Property acquired by
Borrowers or their Subsidiaries after the Closing Date, and in order to fully
consummate all of the transactions contemplated hereby and under the other Loan
Documents. To the maximum extent permitted by applicable law, Borrowers
authorize Agent to execute any such Additional Documents in Borrowers' or their
Subsidiaries' names, as applicable, and authorizes Agent to file such executed
Additional Documents in any appropriate filing office.

         5.18 Healthcare Covenants.

                (a) To the extent they are material or if requested by Agent,
furnish to Agent within thirty (30) days of receipt a copy of any healthcare
related licensure and annual or biannual certification survey report and any
statement of deficiencies and any survey (other than the annual or biannual
survey) indicating a violation or deficiency, and within the time period
required by the particular agency for submission, a copy of the plan of
correction with respect thereto if such plan of correction is required by such
agency issuing the statement of deficiency or notice of violation, and correct
or cause to be corrected any deficiency or violation within the time period
required for cure by such agency, subject to such agency's normal appeal
process, if such deficiency or violation could adversely affect either the right
to continue participation in Medicare, Medicaid or their reimbursement programs
for existing patients or the right to admit new Medicare patients, Medicaid
patients or other reimbursement program patients or result in the loss or
suspension of any licenses and permits to operate the business of any of the
Borrowers or their respective Subsidiaries;

                (b) To the extent they are material or if requested by Agent,
furnish to Agent within thirty (30) days of receipt by any Borrower or its
Subsidiaries, any and all notices disclosing an investigation by or adverse
finding from any licensing, certifying or reimbursement agencies including,
without limitation, any finding that such Borrower's or such Subsidiaries'
license, Medicare or Medicaid certification or entitlement to payments pursuant
to any reimbursement contract or program of any of Borrowers or any such
Subsidiary is being downgraded to a substandard category, revoked, or suspended,
or that action is pending or being considered to downgrade to a substandard
category, revoke, or suspend any rights pursuant to the license, certification
or reimbursement contract or program of any of Borrowers or such Subsidiaries;

                (c) To the extent they are material or if requested by Agent,
furnish to Agent within thirty (30) days of the date of the required filing of
cost reports of each Borrower and its Subsidiaries with Medicaid, Medicare or
other applicable agency or pursuant to any reimbursement contract or program, or
the date of actual filing of such cost report of each such Borrower and such
Subsidiaries, whichever is earlier, a complete and accurate copy of the annual

                                       34
<PAGE>

Medicaid, Medicare and other cost reports for each such Borrower and its
Subsidiaries, which will be prepared by an independent certified public
accountant or by an experienced cost report preparer acceptable to Agent, and
promptly furnish to Agent any amendments filed with respect to such reports and
all responses, audit reports or inquiries with respect to such reports;

                (d) Conduct its operations in a prudent manner in compliance
with applicable laws and regulations relating thereto and cause all licenses,
permits, certificates of need, reimbursement contracts and programs, and any
other agreements necessary for such operations or as may be necessary for
participation in Medicaid, Medicare, and other applicable reimbursement
programs;

                (e) Promptly notify Agent in the event of any action, suit,
proceeding, dispute, offset, deduction, defense or counterclaim that is or may
be asserted by a Payor with respect to any Account (except for denials of
Governmental Receivables, which shall be disclosed on a monthly basis by each
Borrower to Agent). This Section does not require each Borrower to provide a
notice of denial to Agent in those cases where each such Borrower reasonably
believes that a Payor's notice of denial will be reversed upon the submission of
supplemental information to the Payor; and

                (f) Make all payments to the applicable Payor necessary to
prevent such Payor from offsetting any earlier overpayment to each such Borrower
against any amount the Payor may owe on any Accounts.

         5.19 Shell Entities. On or before thirty days following the Closing
Date, the Borrowers shall deliver to Agent evidence satisfactory to Agent in its
sole discretion that each of the Shell Entities has been either merged into the
Parent or dissolved.

         5.20 Bank Accounts. On or before thirty days following the Closing
Date, Borrowers shall deliver to Agent control agreements in form and substance
satisfactory to Agent in its sole discretion with respect to each bank account
of On Line Payroll Services, Inc., On-Line Alternatives, Inc., and Rand Medical
Billing, Inc.

         5.21 Status in Illinois. On or before ten days following the Closing
Date, Borrowers shall deliver to Agent evidence that Integrated Physician
Solutions, Inc. is in good standing with the Secretary of State of Illinois.

         5.22 Status in Texas. On or before January 16, 2007, Medical Billing
Services, Inc. shall file its 2006 Franchise Tax Report with the Texas
Comptroller of Public Accounts.

         5.23 JPMorgan Chase Accounts. On or before two days following the
Closing Date, Borrowers shall cause to be delivered to Agent control agreements
in form and substance satisfactory to Agent in its sole discretion with regard
to each account of Borrowers at JPMorgan Chase Bank, N.A.

         5.24 Prosperity Account. On or before fourteen days following the
Closing Date, Borrowers shall deliver to Agent evidence that bank account number
3098851 at Prosperity Bank has been closed.

         5.25 Commerce Bank. On or before five days following the Closing Date,
Borrowers shall deliver to Agent (a) either a termination of Financing Statement
number 06-7079803797 with the California Secretary of State or an authorization
for Agent to terminate same and (b) if such filings have not lapsed, either
terminations of Financing Statements #0133360063 and #0133360061 with the
California Secretary of State or an authorization for Agent to terminate same.

                                       35
<PAGE>

6.       NEGATIVE COVENANTS.

                  Each Borrower covenants and agrees that, until termination of
all of the Commitments and payment in full of the Obligations, Borrowers will
not and will not permit any of their respective Subsidiaries (other than the
Shell Entities) to do any of the following:

         6.1 Indebtedness. Create, incur, assume, suffer to exist, guarantee, or
otherwise become or remain, directly or indirectly, liable with respect to any
Indebtedness, except:

                (a) Indebtedness evidenced by this Agreement and the other Loan
Documents, together with Indebtedness owed to Underlying Issuers with respect to
Underlying Letters of Credit,

                (b) Indebtedness set forth on Schedule 4.18 and any Refinancing
Indebtedness in respect of such Indebtedness,

                (c) Permitted Purchase Money Indebtedness and any Refinancing
Indebtedness in respect of such Indebtedness,

                (d) endorsement of instruments or other payment items for
deposit,

                (e) Permitted Seller Debt, and

                (f) Indebtedness composing Permitted Investments.

         6.2 Liens. Create, incur, assume, or suffer to exist, directly or
indirectly, any Lien on or with respect to any of its assets, of any kind,
whether now owned or hereafter acquired, or any income or profits therefrom,
except for Permitted Liens.

         6.3 Restrictions on Fundamental Changes.

                (a) Enter into any merger, consolidation, reorganization, or
recapitalization, or reclassify its Stock,

                (b) Liquidate, wind up, or dissolve itself (or suffer any
liquidation or dissolution),

                (c) Suspend or go out of a substantial portion of its or their
business.

         6.4 Disposal of Assets. Other than Permitted Dispositions, convey,
sell, lease, license, assign, transfer, or otherwise dispose of (or enter into
an agreement to convey, sell, lease, license, assign, transfer, or otherwise
dispose of) any of the assets of any Borrowers or any Subsidiary of a Borrower.

         6.5 Change Name. Change any Borrower's or any of its Subsidiaries'
name, organizational identification number, state of organization or
organizational identity; provided, however, that a Borrower or a Subsidiary of a
Borrower may change its name upon at least 30 days prior written notice by
Administrative Borrower to Agent of such change and so long as, at the time of
such written notification, such Borrower or such Subsidiary provides any
financing statements necessary to perfect and continue perfected the Agent's
Liens.

         6.6 Nature of Business. Make any change in the nature of their business
as described in Schedule 6.6 or acquire any properties or assets that are not
reasonably related to the conduct of such business activities.

                                       36
<PAGE>

         6.7 Prepayments and Amendments. Except in connection with Refinancing
Indebtedness permitted by Section 6.1,

                (a) optionally prepay, redeem, defease, purchase, or otherwise
acquire any Indebtedness of any Borrower or any Subsidiary of a Borrower, other
than the Obligations in accordance with this Agreement,

                (b) make any payment on account of Indebtedness that has been
contractually subordinated in right of payment if such payment is not permitted
at such time under the subordination terms and conditions, or

                (c) directly or indirectly, amend, modify, alter, increase, or
change any of the terms or conditions of any agreement, instrument, document,
indenture, or other writing evidencing or concerning Indebtedness permitted
under Section 6.1(b) or (c).

         6.8 Change of Control. Cause, permit, or suffer, directly or
indirectly, any Change of Control.

         6.9 Consignments. Consign any of their Inventory or sell any of their
Inventory on bill and hold, sale or return, sale on approval, or other
conditional terms of sale.

         6.10 Distributions. Make any distribution or declare or pay any
dividends (in cash or other property, other than common Stock) on, or purchase,
acquire, redeem, or retire any of any Borrower's Stock, of any class, whether
now or hereafter outstanding; notwithstanding the foregoing, if no Default or
Event of Default has occurred and is continuing, a Borrower may, consistent with
past practices of Borrowers, advance or distribute cash to another Borrower;
provided further, however, that notwithstanding anything to the contrary
contained herein, nothing in this Section 6.10 shall operate to prevent payment
by any Borrower to Parent of cash distributions in an amount sufficient to allow
payment to pay the consolidated tax liabilities of Parent.

         6.11 Accounting Methods. Modify or change their fiscal year or their
method of accounting (other than as may be required to conform to GAAP) or enter
into, modify, or terminate any agreement currently existing, or at any time
hereafter entered into with any third party accounting firm or service bureau
for the preparation or storage of Borrowers' or their Subsidiaries' accounting
records without said accounting firm or service bureau agreeing to provide Agent
information regarding Borrowers' and their Subsidiaries' financial condition.

         6.12 Investments. Except for Permitted Investments, directly or
indirectly, make or acquire any Investment or incur any liabilities (including
contingent obligations) for or in connection with any Investment; provided,
however, that Administrative Borrower and its Subsidiaries shall not have
Permitted Investments (other than in the Cash Management Accounts) in Deposit
Accounts or Securities Accounts in an aggregate amount in excess of $25,000 at
any one time unless Administrative Borrower or its Subsidiary, as applicable,
and the applicable securities intermediary or bank have entered into Control
Agreements governing such Permitted Investments in order to perfect (and further
establish) the Agent's Liens in such Permitted Investments. Subject to the
foregoing proviso Borrowers shall not and shall not permit their Subsidiaries to
establish or maintain any Deposit Account or Securities Account unless Agent
shall have received a Control Agreement in respect of such Deposit Account or
Securities Account. Notwithstanding the foregoing, this Section 6.12 will not be
breached by Investments in any Deposit Account or Securities Account as to which
Agent has not received a Control Agreement but solely during the respective time
periods and solely with regard to the respective depository institutions for
which control agreements are not required under the terms of Sections 5.20, 5.23
and 5.24.

         6.13 Transactions with Affiliates. Directly or indirectly enter into or
permit to exist any transaction with any Affiliate of any Borrower or any
Subsidiary of a Borrower except for:

                                       37
<PAGE>

                (a) transactions (other the payment of management, consulting,
monitoring, or advisory fees or employment agreements or employee benefit
arrangements) between Borrowers or their Subsidiaries, on the one hand, and any
Affiliate of Borrowers or their Subsidiaries, on the other hand, so long as such
transactions (i) are upon fair and reasonable terms, (ii) are fully disclosed to
Agent if they involve one or more payments by any Borrower or any of Subsidiary
of a Borrower in excess of $100,000 for any single transaction or series of
transactions, and (iii) are no less favorable to Borrowers or their
Subsidiaries, as applicable, than would be obtained in an arm's length
transaction with a non-Affiliate; and

                (b) the payment of reasonable fees, compensation, or employee
benefit arrangements to, and any indemnity provided for the benefit of, outside
directors of Parent in the ordinary course of business and consistent with
industry practice.

         6.14 Use of Proceeds. (a) Use the proceeds of the Advances and the Term
Loan A for any purpose other than, on the Closing Date (i) to repay, in full,
the outstanding principal, accrued interest, and accrued fees and expenses owing
to Existing Lender, (ii) to finance the acquisitions of On-Line Alternatives,
Inc., On Line Payroll Services, Inc. and Rand and (iii) to pay transactional
fees, costs, and expenses incurred in connection with this Agreement, the other
Loan Documents, and the transactions contemplated hereby and thereby, (b)
thereafter, use the proceeds of the Advances for any purpose other than working
capital needs, consistent with the terms and conditions hereof; provided,
however, that the proceeds of Advances may not be used in connection with any
acquisition, whether or not constituting a Permitted Acquisition, and (c)
thereafter, use the proceeds of the Term Loan B for any purpose other than
Permitted Acquisitions, consistent with the terms and conditions hereof.

         6.15 Inventory and Equipment with Bailees. Store the Inventory or
Equipment of Borrowers or their Subsidiaries at any time now or hereafter with a
bailee, warehouseman, or similar party.

         6.16 Financial Covenants.

         (a) Minimum TTM EBITDA. Fail to achieve TTM EBITDA, measured on a
month-end basis, of at least the required amount set forth in the following
table for the twelve month period ending as of the measurement date set forth
opposite thereto:

--------------------------------------------------------------------------------
     Applicable Amount                       Measurement Date
--------------------------------------------------------------------------------
         $2,250,000                         December 31, 2006
--------------------------------------------------------------------------------
         $2,300,000                          January 31, 2007
--------------------------------------------------------------------------------
         $2,300,000                         February 28, 2007
--------------------------------------------------------------------------------
         $2,300,000                           March 31, 2007
--------------------------------------------------------------------------------
         $2,300,000                           April 30, 2007
--------------------------------------------------------------------------------
         $2,300,000                            May 31, 2007
--------------------------------------------------------------------------------
         $2,300,000                           June 30, 2007
--------------------------------------------------------------------------------
         $2,300,000                           July 31, 2007
--------------------------------------------------------------------------------
         $2,300,000                          August 31, 2007
--------------------------------------------------------------------------------
         $2,450,000                         September 30, 2007
--------------------------------------------------------------------------------
         $2,450,000                          October 31, 2007
--------------------------------------------------------------------------------
         $2,500,000                         November 30, 2007
--------------------------------------------------------------------------------
         $2,500,000                         December 31, 2007
--------------------------------------------------------------------------------
         $2,600,000                          January 31, 2008
--------------------------------------------------------------------------------
         $2,700,000                         February 29, 2008
--------------------------------------------------------------------------------
         $2,800,000                           March 31, 2008
--------------------------------------------------------------------------------
         $2,900,000                           April 30, 2008
--------------------------------------------------------------------------------
         $2,900,000                            May 31, 2008
--------------------------------------------------------------------------------
         $2,900,000                           June 30, 2008
--------------------------------------------------------------------------------

                                       38
<PAGE>

--------------------------------------------------------------------------------
         $3,000,000                           July 31, 2008
--------------------------------------------------------------------------------
         $3,000,000                          August 31, 2008
--------------------------------------------------------------------------------
         $3,250,000                         September 30, 2008
--------------------------------------------------------------------------------
         $3,250,000                          October 31, 2008
--------------------------------------------------------------------------------
         $3,300,000                         November 30, 2008
--------------------------------------------------------------------------------
         $3,400,000                         December 31, 2008
--------------------------------------------------------------------------------
         $3,400,000                          January 31, 2009
--------------------------------------------------------------------------------
         $3,500,000                         February 28, 2009
--------------------------------------------------------------------------------
         $3,500,000                           March 31, 2009
--------------------------------------------------------------------------------
         $3,600,000                           April 30, 2009
--------------------------------------------------------------------------------
         $3,700,000                            May 31, 2009
--------------------------------------------------------------------------------
         $3,700,000                           June 30, 2009
--------------------------------------------------------------------------------
         $3,800,000                           July 31, 2009
--------------------------------------------------------------------------------
         $3,800,000                          August 31, 2009
--------------------------------------------------------------------------------
         $3,900,000                         September 30, 2009
--------------------------------------------------------------------------------
         $4,000,000                          October 31, 2009
--------------------------------------------------------------------------------
         $4,000,000                         November 30, 2009
--------------------------------------------------------------------------------
         $4,100,000                         December 31, 2009
--------------------------------------------------------------------------------
         $4,100,000                          January 31, 2010
--------------------------------------------------------------------------------
         $4,200,000                         February 28, 2010
--------------------------------------------------------------------------------
         $4,200,000                           March 31, 2010
--------------------------------------------------------------------------------
         $4,300,000                           April 30, 2010
--------------------------------------------------------------------------------
         $4,300,000                            May 31, 2010
--------------------------------------------------------------------------------
         $4,400,000                           June 30, 2010
--------------------------------------------------------------------------------
         $4,500,000                           July 31, 2010
--------------------------------------------------------------------------------
         $4,500,000                          August 31, 2010
--------------------------------------------------------------------------------
         $4,500,000                         September 30, 2010
--------------------------------------------------------------------------------
         $4,600,000                          October 31, 2010
--------------------------------------------------------------------------------
         $4,600,000                         November 30, 2010
--------------------------------------------------------------------------------
         $4,750,000         December 31, 2010 and for month ending thereafter
--------------------------------------------------------------------------------

Concurrently with the closing of each Permitted Acquisition, the EBITDA levels
for each month shall be adjusted to 85% of TTM EBITDA for such month as set
forth in the most recent Projections of Parent (as adjusted to take into account
Projected Pro Forma Target EBITDA).

                (b) Fixed Charge Coverage Ratio. Have a Fixed Charge Coverage
Ratio, measured as of quarter-end, less than the required amount set forth in
the following table for the applicable period set forth opposite thereto:

--------------------------------------------------------------------------------

    Applicable Ratio                      Applicable Period
--------------------------------------------------------------------------------
       1.40:1.00                        For the fiscal quarter
                                        ending March 31, 2007
--------------------------------------------------------------------------------
       1.40:1.00       For the two fiscal quarter period ending as of June 30,
                                                 2007
--------------------------------------------------------------------------------
       1.40:1.00           For the three fiscal quarter period ending as of
                                          September 30, 2007
--------------------------------------------------------------------------------
       0.70:1.00           For the four fiscal quarter period ending as of
                                          December 31, 2007
--------------------------------------------------------------------------------
       0.70:1.00              For the four fiscal quarter period ending
                                            March 31, 2008
--------------------------------------------------------------------------------
       0.70:1.00           For the four fiscal quarter period ending as of
                                            June 30, 2008
--------------------------------------------------------------------------------

                                       39
<PAGE>

--------------------------------------------------------------------------------
       0.70:1.00           For the four fiscal quarter period ending as of
                                          September 30, 2008
--------------------------------------------------------------------------------
       1.00:1.00           For the four fiscal quarter period ending as of
                                          December 31, 2008
--------------------------------------------------------------------------------
       1.20:1.00        For the four fiscal quarter period ending as of March
                       31, 2008 and for each four fiscal quarter period ending
                                              thereafter
--------------------------------------------------------------------------------

                (c) Senior Leverage Ratio. Have a Senior Leverage Ratio,
measured on a month-end basis, more than the applicable ratio set forth in the
following table for the applicable date set forth opposite thereto:

--------------------------------------------------------------------------------

  Applicable Ratio                          Applicable Date
--------------------------------------------------------------------------------
      2.50:1.00                            December 31, 2006
--------------------------------------------------------------------------------
      2.50:1.00                             January 31, 2007
--------------------------------------------------------------------------------
      2.50:1.00                            February 28, 2007
--------------------------------------------------------------------------------
      2.50:1.00                              March 31, 2007
--------------------------------------------------------------------------------
      2.50:1.00                              April 30, 2007
--------------------------------------------------------------------------------
      2.25:1.00                               May 31, 2007
--------------------------------------------------------------------------------
      2.25:1.00                              June 30, 2007
--------------------------------------------------------------------------------
      2.25:1.00                              July 31, 2007
--------------------------------------------------------------------------------
      2.25:1.00                             August 31, 2007
--------------------------------------------------------------------------------
      2.25:1.00                            September 30, 2007
--------------------------------------------------------------------------------
      2.25:1.00                             October 31, 2007
--------------------------------------------------------------------------------
      2.25:1.00          November 30, 2007 as for each month ending thereafter
--------------------------------------------------------------------------------

                (d) Capital Expenditures. Make Capital Expenditures in any
fiscal year in excess of the amount set forth in the following table for the
applicable period:

--------------------------------------------------------------------------------

    Fiscal Year 2006       Fiscal Year 2007       Fiscal Year 2008 and each
                                                Fiscal Year ending thereafter
--------------------------------------------------------------------------------

        $230,000               $300,000                    $250,000
--------------------------------------------------------------------------------

7. EVENTS OF DEFAULT.

                  Any one or more of the following events shall constitute an
event of default (each, an "Event of Default") under this Agreement:

         7.1 If Borrowers fail to pay when due and payable, or when declared due
and payable, (a) all or any portion of the Obligations consisting of interest,
fees, or charges due the Lender Group, reimbursement of Lender Group Expenses,
or other amounts (other than any portion thereof constituting principal)
constituting Obligations (including any portion thereof that accrues after the
commencement of an Insolvency Proceeding, regardless of whether allowed or
allowable in whole or in part as a claim in any such Insolvency Proceeding), and
such failure continues for a period of 3 Business Days, or (b) all or any
portion of the principal of the Obligations;

                                       40
<PAGE>

         7.2 If Borrowers or any Subsidiary of any Borrower

                (a) fails to perform or observe any covenant or other agreement
contained in any of Sections 2.7, 5.2, 5.3, 5.4, 5.5, 5.8, 5.12, 5.14, 5.16,
5.17, 5.18 and 6.1 through 6.16 of this Agreement or Section 6 of the Security
Agreement;

                (b) fails to perform or observe any covenant or other agreement
contained in any of Sections 5.6, 5.7, 5.9, 5.10, 5.11 and 5.15 of this
Agreement and such failure continues for a period of 10 days after the earlier
of (i) the date on which such failure shall first become known to any officer of
any Borrower or (ii) written notice thereof is given to Administrative Borrower
by Agent; or

                (c) fails to perform or observe any covenant or other agreement
contained in this Agreement, or in any of the other Loan Documents, in each
case, other than any such covenant or agreement that is the subject of another
provision of this Section 7 (in which event such other provision of this Section
7 shall govern), and such failure continues for a period of 20 days after the
earlier of (i) the date on which such failure shall first become known to any
officer of any Borrower or (ii) written notice thereof is given to
Administrative Borrower by Agent;

         7.3 If any material portion of any Borrower's or any of its
Subsidiaries' assets is attached, seized, subjected to a writ or distress
warrant, or is levied upon, or comes into the possession of any third Person and
the same is not discharged before the earlier of 30 days after the date it first
arises or 5 days prior to the date on which such property or asset is subject to
forfeiture by such Borrower or the applicable Subsidiary;

         7.4 If an Insolvency Proceeding is commenced by any Borrower or any
Subsidiary of a Borrower;

         7.5 If an Insolvency Proceeding is commenced against any Borrower or
any Subsidiary of a Borrower, and any of the following events occur: (a) the
applicable Borrower or Subsidiary consents to the institution of such Insolvency
Proceeding against it, (b) the petition commencing the Insolvency Proceeding is
not timely controverted, (c) the petition commencing the Insolvency Proceeding
is not dismissed within 60 calendar days of the date of the filing thereof, (d)
an interim trustee is appointed to take possession of all or any substantial
portion of the properties or assets of, or to operate all or any substantial
portion of the business of, any Borrower or any Subsidiary of a Borrower, or (e)
an order for relief shall have been issued or entered therein;

         7.6 If any Borrower or any Subsidiary of a Borrower is enjoined,
restrained, or in any way prevented by court order from continuing to conduct
all or any material part of its business affairs;

         7.7 If one or more judgments, orders, or awards involving an aggregate
amount of $100,000 or more (except to the extent fully covered by insurance
pursuant to which the insurer has accepted liability therefor in writing) shall
be entered or filed against any Borrower or any Subsidiary of any Borrower or
with respect to any of their respective assets, and the same is not released,
discharged, bonded against, or stayed pending appeal before the earlier of 30
days after the date it first arises or 5 days prior to the date on which such
asset is subject to being forfeited by the applicable Borrower or the applicable
Subsidiary;

         7.8 If there is a default in one or more agreements to which any
Borrower or any Subsidiary of a Borrower is a party with one or more third
Persons relative to Indebtedness of any Borrower or any Subsidiary of any
Borrower involving an aggregate amount of $100,000 or more, and such default (i)
occurs at the final maturity of the obligations thereunder, or (ii) results in a
right by such third Person(s), irrespective of whether exercised and
irrespective of whether such right is restricted in a subordination agreement
executed in favor of Agent, to accelerate the maturity of the applicable
Borrower's or Subsidiary's obligations thereunder;

                                       41
<PAGE>

         7.9 If any warranty, representation, statement, or Record made herein
or in any other Loan Document or delivered to Agent or any Lender in connection
with this Agreement or any other Loan Document proves to be untrue in any
material respect (except 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) as of the date of issuance or making or deemed
making thereof;

         7.10 If the obligation of any Guarantor under the Guaranty is limited
or terminated by operation of law or by such Guarantor, or any such Guarantor
becomes the subject of an Insolvency Proceeding;

         7.11 If the Security Agreement or any other Loan Document that purports
to create a Lien, shall, for any reason, fail or cease to create a valid and
perfected and, except to the extent permitted by the terms hereof or thereof,
first priority Lien on or security interest in the Collateral covered hereby or
thereby, except as a result of a disposition of the applicable Collateral in a
transaction permitted under this Agreement;

         7.12 Any provision of any Loan Document shall at any time for any
reason be declared to be null and void, or the validity or enforceability
thereof shall be contested by any Borrower or any Subsidiary of a Borrower, or a
proceeding shall be commenced by any Borrower or any Subsidiary of a Borrower,
or by any Governmental Authority having jurisdiction over any Borrower or any
Subsidiary of a Borrower, seeking to establish the invalidity or
unenforceability thereof, or any Borrower or any Subsidiary of a Borrower shall
deny that it has any liability or obligation purported to be created under any
Loan Document; or.

         7.13 If there is a loss, cancellation, suspension or revocation of, or
failure to renew, any contract now held or hereafter acquired by any Loan Party
or any of its Subsidiaries and such loss, cancellation, suspension, revocation
or failure to renew relates to contracts which, in the aggregate, contribute 10%
or more of the net consolidated revenues of the Parent.

8. THE LENDER GROUP'S RIGHTS AND REMEDIES.

         8.1 Rights and Remedies. Upon the occurrence, and during the
continuation, of an Event of Default, the Required Lenders (at their election
but without notice of their election and without demand) may authorize and
instruct Agent to do any one or more of the following on behalf of the Lender
Group (and Agent, acting upon the instructions of the Required Lenders, shall do
the same on behalf of the Lender Group), all of which are authorized by
Borrowers:

                (a) Declare all or any portion of the Obligations, whether
evidenced by this Agreement, by any of the other Loan Documents, or otherwise,
immediately due and payable;

                (b) Cease advancing money or extending credit to or for the
benefit of Borrowers under this Agreement, under any of the Loan Documents, or
under any other agreement between Borrowers and the Lender Group;

                (c) Terminate this Agreement and any of the other Loan Documents
as to any future liability or obligation of the Lender Group, but without
affecting any of the Agent's Liens in the Collateral and without affecting the
Obligations; and

                (d) The Lender Group shall have all other rights and remedies
available at law or in equity or pursuant to any other Loan Document.

The foregoing to the contrary notwithstanding, upon the occurrence of any Event
of Default described in Section 7.4 or Section 7.5, in addition to the remedies
set forth above, without any notice to Borrowers or any other Person or any act
by the Lender Group, the Commitments shall automatically terminate and the
Obligations then outstanding, together with all accrued and unpaid interest
thereon and all fees and all other amounts due under this Agreement and the
other Loan Documents, shall automatically and immediately become due and
payable, without presentment, demand, protest, or notice of any kind, all of
which are expressly waived by Borrowers.

                                       42
<PAGE>

         8.2 Remedies Cumulative. The rights and remedies of the Lender Group
under this Agreement, the other Loan Documents, and all other agreements shall
be cumulative. The Lender Group shall have all other rights and remedies not
inconsistent herewith as provided under the Code, by law, or in equity. No
exercise by the Lender Group of one right or remedy shall be deemed an election,
and no waiver by the Lender Group of any Event of Default shall be deemed a
continuing waiver. No delay by the Lender Group shall constitute a waiver,
election, or acquiescence by it.

9. TAXES AND EXPENSES.

                  If any Borrower fails to pay any monies (whether taxes,
assessments, insurance premiums, or, in the case of leased properties or assets,
rents or other amounts payable under such leases) due to third Persons, or fails
to make any deposits or furnish any required proof of payment or deposit, all as
required under the terms of this Agreement, then, Agent, in its sole discretion
and with notice to Parent either contemporaneously therewith or promptly
thereafter, may do any or all of the following: (a) make payment of the same or
any part thereof, (b) set up such reserves against the Borrowing Base or the
Maximum Revolver Amount as Agent deems necessary to protect the Lender Group
from the exposure created by such failure, or (c) in the case of the failure to
comply with Section 5.8 hereof, obtain and maintain insurance policies of the
type described in Section 5.8 and take any action with respect to such policies
as Agent deems prudent. Any such amounts paid by Agent shall constitute Lender
Group Expenses and any such payments shall not constitute an agreement by the
Lender Group to make similar payments in the future or a waiver by the Lender
Group of any Event of Default under this Agreement. Agent need not inquire as
to, or contest the validity of, any such expense, tax, or Lien and the receipt
of the usual official notice for the payment thereof shall be conclusive
evidence that the same was validly due and owing.

10.      WAIVERS; INDEMNIFICATION.

         10.1 Demand; Protest; etc.. Each Borrower waives demand, protest,
notice of protest, notice of default or dishonor, notice of payment and
nonpayment, nonpayment at maturity, release, compromise, settlement, extension,
or renewal of documents, instruments, chattel paper, and guarantees at any time
held by the Lender Group on which any such Borrower may in any way be liable.

         10.2 The Lender Group's Liability for Collateral. Each Borrower hereby
agrees that: (a) so long as Agent complies with its obligations, if any, under
the Code, the Lender Group shall not in any way or manner be liable or
responsible for: (i) the safekeeping of the Collateral, (ii) any loss or damage
thereto occurring or arising in any manner or fashion from any cause, (iii) any
diminution in the value thereof, or (iv) any act or default of any carrier,
warehouseman, bailee, forwarding agency, or other Person, and (b) all risk of
loss, damage, or destruction of the Collateral shall be borne by Borrowers.

         10.3 Indemnification. Each Borrower shall pay, indemnify, defend, and
hold the Agent-Related Persons, the Lender-Related Persons, and each Participant
(each, an "Indemnified Person") harmless (to the fullest extent permitted by
law) from and against any and all claims, demands, suits, actions,
investigations, proceedings, liabilities, fines, costs, penalties, and damages
(other than Excluded Taxes), and all reasonable fees and disbursements of
attorneys, experts, or consultants and all other costs and expenses actually
incurred in connection therewith or in connection with the enforcement of this
indemnification (as and when they are incurred and irrespective of whether suit
is brought), at any time asserted against, imposed upon, or incurred by any of
them (a) in connection with or as a result of or related to the execution,
delivery, enforcement, performance, or administration (including any
restructuring or workout with respect hereto) of this Agreement, any of the
other Loan Documents, or the transactions contemplated hereby or thereby or the
monitoring of Borrowers' and their Subsidiaries' compliance with the terms of
the Loan Documents, (b) with respect to any investigation, litigation, or

                                       43
<PAGE>

proceeding related to this Agreement, any other Loan Document, or the use of the
proceeds of the credit provided hereunder (irrespective of whether any
Indemnified Person is a party thereto), or any act, omission, event, or
circumstance in any manner related thereto, and (c) in connection with or
arising out of any presence or release of Hazardous Materials at, on, under, to
or from any assets or properties owned, leased or operated by Parent or any of
its Subsidiaries or any Environmental Actions, Environmental Liabilities and
Costs or Remedial Actions related in any way to any such assets or properties of
Parent or any of its Subsidiaries (each and all of the foregoing, the
"Indemnified Liabilities"). The foregoing to the contrary notwithstanding,
Borrowers shall have no obligation to any Indemnified Person under this Section
10.3 with respect to any Indemnified Liability that a court of competent
jurisdiction finally determines to have resulted from the gross negligence or
willful misconduct of such Indemnified Person. This provision shall survive the
termination of this Agreement and the repayment of the Obligations. If any
Indemnified Person makes any payment to any other Indemnified Person with
respect to an Indemnified Liability as to which Borrowers were required to
indemnify the Indemnified Person receiving such payment, the Indemnified Person
making such payment is entitled to be indemnified and reimbursed by Borrowers
with respect thereto. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO
EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES WHICH IN WHOLE
OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF SUCH
INDEMNIFIED PERSON OR OF ANY OTHER PERSON.

11.      NOTICES.

                  Unless otherwise provided in this Agreement, all notices or
demands by Borrowers or Agent to the other relating to this Agreement or any
other Loan Document shall be in writing and (except for financial statements and
other informational documents which may be sent by first-class mail, postage
prepaid) shall be personally delivered or sent by registered or certified mail
(postage prepaid, return receipt requested), overnight courier, electronic mail
(at such email addresses as Administrative Borrower or Agent, as applicable, may
designate to each other in accordance herewith), or telefacsimile to Borrowers
in care of Administrative Borrower or to Agent, as the case may be, at its
address set forth below:

     If to Administrative Borrower:    Orion HealthCorp, Inc.
                                       1805 Old Alabama Road, Suite 350
                                       Roswell, Georgia 30076
                                       Attn:  Terrence L. Bauer
                                       Fax No.:  678 832-1888

     with copies to:                   Benesch, Friedlander Coplan & Aronoff LLP
                                       2300 BP Tower, 200 Public Square
                                       Cleveland, OH 44114
                                       Attn: Douglas Haas, Esq.
                                       Fax: No. 216.363.4588

     If to Agent:                      WELLS FARGO FOOTHILL, INC.
                                       2450 Colorado Avenue
                                       Suite 3000 West
                                       Santa Monica, CA  90404
                                       Attn:  Specialty Finance Manager
                                       Fax No.:  (310) 453-7422

                                       44
<PAGE>

     with copies to:                   Jenkens & Gilchrist, LLP
                                       12100 Wilshire Blvd., 15th Floor
                                       Los Angeles, California  90025
                                       Attn:  Gary Samson, Esq.
                                       Fax No.:  (310) 820-8859

                  Agent and Borrowers may change the address at which they are
to receive notices hereunder, by notice in writing in the foregoing manner given
to the other party. All notices or demands sent in accordance with this Section
11, other than notices by Agent in connection with enforcement rights against
the Collateral under the provisions of the Code, shall be deemed received on the
earlier of the date of actual receipt or 3 Business Days after the deposit
thereof in the mail. Each Borrower acknowledges and agrees that notices sent by
the Lender Group in connection with the exercise of enforcement rights against
Collateral under the provisions of the Code shall be deemed sent when deposited
in the mail or personally delivered, or, where permitted by law, transmitted by
telefacsimile or any other method set forth above.

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

                (a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
(UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT
OF SUCH OTHER LOAN DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT
HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND THERETO WITH
RESPECT TO ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR
THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.

                (b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN
CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRIED AND
LITIGATED ONLY IN THE STATE AND TO THE EXTENT PERMITTED BY APPLICABLE LAW,
FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK; PROVIDED,
HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER
PROPERTY MAY BE BROUGHT, AT AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION
WHERE AGENT ELECTS TO BRING SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER
PROPERTY MAY BE FOUND. BORROWERS AND EACH MEMBER OF THE LENDER GROUP WAIVE, TO
THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE
DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY
PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 12(b).

                (c) TO THE EXTENT PERMITTED BY APPLICABLE LAW, BORROWERS AND
EACH MEMBER OF THE LENDER GROUP HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE
LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR
STATUTORY CLAIMS. BORROWERS AND EACH MEMBER OF THE LENDER GROUP REPRESENT THAT
EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY
TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF
LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A
TRIAL BY THE COURT.

                (d) NO ACTION SEEKING ENFORCEMENT OF, OR ANY OTHER LEGAL REMEDY
FOUNDED ON, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE COMMENCED IN THE
STATE OF CALIFORNIA IN VIOLATION OF SECTION 12(C); PROVIDED THAT IN THE EVENT
THAT ANY SUCH ACTION IS COMMENCED OR MAINTAINED IN VIOLATION THEREOF AND THE

                                       45
<PAGE>

WAIVER OF JURY TRIAL SET FORTH ABOVE IS NOT ENFORCEABLE, BORROWERS AND EACH
MEMBER OF THE LENDER GROUP HEREBY ELECT TO PROCEED AS FOLLOWS: (I) THE COURT
SHALL, AND IS HEREBY DIRECTED TO, MAKE A GENERAL REFERENCE PURSUANT TO
CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 638 TO A REFEREE OR REFEREES TO HEAR
AND DETERMINE ALL OF THE ISSUES IN SUCH ACTION OR PROCEEDING (WHETHER OF FACT OR
OF LAW) AND TO REPORT A STATEMENT OF DECISION, PROVIDED THAT ANY SUCH ISSUES
PERTAINING TO A "PROVISIONAL REMEDY" AS DEFINED IN CALIFORNIA CODE OF CIVIL
PROCEDURE SECTION 1281.8 SHALL BE HEARD AND DETERMINED BY THE COURT, AND (II)
BORROWERS SHALL BE SOLELY RESPONSIBLE TO PAY ALL FEES AND EXPENSES OF ANY
REFEREE APPOINTED IN SUCH ACTION OR PROCEEDING.

13. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.

         13.1 Assignments and Participations.

                (a) Any Lender may assign and delegate to one or more assignees
(each an "Assignee") that are Eligible Transferees all or any portion, of the
Obligations, the Commitments and the other rights and obligations of such Lender
hereunder and under the other Loan Documents, in a minimum amount (unless waived
by the Agent) of $5,000,000 (except such minimum amount shall not apply to (x)
an assignment or delegation by any Lender to any other Lender or an Affiliate of
any Lender or (y) a group of new Lenders, each of whom is an Affiliate of each
other or a fund or account managed by any such new Lender or an Affiliate of
such new Lender to the extent that the aggregate amount to be assigned to all
such new Lenders is at least $5,000,000); provided, however, that Borrowers and
Agent may continue to deal solely and directly with such Lender in connection
with the interest so assigned to an Assignee until (i) written notice of such
assignment, together with payment instructions, addresses, and related
information with respect to the Assignee, have been given to Administrative
Borrower and Agent by such Lender and the Assignee, (ii) such Lender and its
Assignee have delivered to Administrative Borrower and Agent an Assignment and
Acceptance and Agent has notified the assigning Lender of its receipt thereof in
accordance with Section 13.1(b), and (iii) unless waived by the Agent, the
assigning Lender or Assignee has paid to Agent for Agent's separate account a
processing fee in the amount of $3,500. Anything contained herein to the
contrary notwithstanding, the payment of any fees shall not be required and the
Assignee need not be an Eligible Transferee if such assignment is in connection
with any merger, consolidation, sale, transfer, or other disposition of all or
any substantial portion of the business or loan portfolio of the assigning
Lender.

                (b) From and after the date that Agent notifies the assigning
Lender (with a copy to Administrative Borrower) that it has received an executed
Assignment and Acceptance and, if applicable, payment of the required processing
fee, (i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Lender
under the Loan Documents, and (ii) the assigning Lender shall, to the extent
that rights and obligations hereunder and under the other Loan Documents have
been assigned by it pursuant to such Assignment and Acceptance, relinquish its
rights (except with respect to Section 10.3 hereof) and be released from any
future obligations under this Agreement (and in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and obligations under this Agreement and the other Loan Documents, such Lender
shall cease to be a party hereto and thereto), and such assignment shall effect
a novation among Borrowers, the assigning Lender, and the Assignee; provided,
however, that nothing contained herein shall release any assigning Lender from
obligations that survive the termination of this Agreement, including such
assigning Lender's obligations under Section 15 and Section 16.7(a) of this
Agreement.

                (c) By executing and delivering an Assignment and Acceptance,
the assigning Lender thereunder and the Assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this

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Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other Loan Document furnished
pursuant hereto, (ii) such assigning Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition of
Borrowers or the performance or observance by Borrowers of any of their
obligations under this Agreement or any other Loan Document furnished pursuant
hereto, (iii) such Assignee confirms that it has received a copy of this
Agreement, together with such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance, (iv) such Assignee will, independently and without
reliance upon Agent, such assigning Lender or any other Lender, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement, (v) such Assignee appoints and authorizes Agent to take such
actions and to exercise such powers under this Agreement as are delegated to
Agent, by the terms hereof, together with such powers as are reasonably
incidental thereto, and (vi) such Assignee agrees that it will perform all of
the obligations which by the terms of this Agreement are required to be
performed by it as a Lender.

                (d) Immediately upon Agent's receipt of the required processing
fee, if applicable, and delivery of notice to the assigning Lender pursuant to
Section 13.1(b), this Agreement shall be deemed to be amended to the extent, but
only to the extent, necessary to reflect the addition of the Assignee and the
resulting adjustment of the Commitments arising therefrom. The Commitment
allocated to each Assignee shall reduce such Commitments of the assigning Lender
pro tanto.

                (e) Any Lender may at any time sell to one or more commercial
banks, financial institutions, or other Persons (a "Participant") participating
interests in all or any portion of its Obligations, its Commitment, and the
other rights and interests of that Lender (the "Originating Lender") hereunder
and under the other Loan Documents; provided, however, that (i) the Originating
Lender shall remain a "Lender" for all purposes of this Agreement and the other
Loan Documents and the Participant receiving the participating interest in the
Obligations, the Commitments, and the other rights and interests of the
Originating Lender hereunder shall not constitute a "Lender" hereunder or under
the other Loan Documents and the Originating Lender's obligations under this
Agreement shall remain unchanged, (ii) the Originating Lender shall remain
solely responsible for the performance of such obligations, (iii) Borrowers,
Agent, and the Lenders shall continue to deal solely and directly with the
Originating Lender in connection with the Originating Lender's rights and
obligations under this Agreement and the other Loan Documents, (iv) no Lender
shall transfer or grant any participating interest under which the Participant
has the right to approve any amendment to, or any consent or waiver with respect
to, this Agreement or any other Loan Document, except to the extent such
amendment to, or consent or waiver with respect to this Agreement or of any
other Loan Document would (A) extend the final maturity date of the Obligations
hereunder in which such Participant is participating, (B) reduce the interest
rate applicable to the Obligations hereunder in which such Participant is
participating, (C) release all or substantially all of the Collateral or
guaranties (except to the extent expressly provided herein or in any of the Loan
Documents) supporting the Obligations hereunder in which such Participant is
participating, (D) postpone the payment of, or reduce the amount of, the
interest or fees payable to such Participant through such Lender, or (E) change
the amount or due dates of scheduled principal repayments or prepayments or
premiums, and (v) all amounts payable by Borrowers hereunder shall be determined
as if such Lender had not sold such participation, except that, if amounts
outstanding under this Agreement are due and unpaid, or shall have been declared
or shall have become due and payable upon the occurrence of an Event of Default,
each Participant shall be deemed to have the right of set off in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement. The rights of any Participant only shall be
derivative through the Originating Lender with whom such Participant
participates and no Participant shall have any rights under this Agreement or
the other Loan Documents or any direct rights as to the other Lenders, Agent,
Borrowers, the Collections of Borrowers or their Subsidiaries, the Collateral,
or otherwise in respect of the Obligations. No Participant shall have the right
to participate directly in the making of decisions by the Lenders among
themselves.

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                (f) In connection with any such assignment or participation or
proposed assignment or participation, a Lender may, subject to the provisions of
Section 16.7, disclose all documents and information which it now or hereafter
may have relating to Borrowers and their Subsidiaries and their respective
businesses.

                (g) Any other provision in this Agreement notwithstanding, any
Lender may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement in favor of any
Federal Reserve Bank in accordance with Regulation A of the Federal Reserve Bank
or U.S. Treasury Regulation 31 CFR ss. 203.24, and such Federal Reserve Bank may
enforce such pledge or security interest in any manner permitted under
applicable law.

         13.2 Successors. This Agreement shall bind and inure to the benefit of
the respective successors and assigns of each of the parties; provided, however,
that Borrowers may not assign this Agreement or any rights or duties hereunder
without the Lenders' prior written consent and any prohibited assignment shall
be absolutely void ab initio. No consent to assignment by the Lenders shall
release any Borrower from its Obligations. A Lender may assign this Agreement
and the other Loan Documents and its rights and duties hereunder and thereunder
pursuant to Section 13.1 hereof and, except as expressly required pursuant to
Section 13.1 hereof, no consent or approval by any Borrower is required in
connection with any such assignment.

14. AMENDMENTS; WAIVERS.

         14.1 Amendments and Waivers. No amendment or waiver of any provision of
this Agreement or any other Loan Document (other than Bank Product Agreements or
the Fee Letter), and no consent with respect to any departure by Borrowers
therefrom, shall be effective unless the same shall be in writing and signed by
the Required Lenders (or by Agent at the written request of the Required
Lenders) and Administrative Borrower (on behalf of all Borrowers) and then any
such waiver or consent shall be effective, but only in the specific instance and
for the specific purpose for which given; provided, however, that no such
waiver, amendment, or consent shall, unless in writing and signed by all of the
Lenders directly affected thereby and Administrative Borrower (on behalf of all
Borrowers), do any of the following:

                (a) increase or extend any Commitment of any Lender,

                (b) postpone or delay any date fixed by this Agreement or any
other Loan Document for any payment of principal, interest, fees, or other
amounts due hereunder or under any other Loan Document,

                (c) reduce the principal of, or the rate of interest on, any
loan or other extension of credit hereunder, or reduce any fees or other amounts
payable hereunder or under any other Loan Document,

                (d) change the Pro Rata Share that is required to take any
action hereunder,

                (e) amend or modify this Section or any provision of this
Agreement providing for consent or other action by all Lenders,

                (f) other than as permitted by Section 15.12, release Agent's
Lien in and to any of the Collateral,

                (g) change the definition of "Required Lenders" or "Pro Rata
Share",

                (h) contractually subordinate any of the Agent's Liens,

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                (i) other than in connection with a merger, liquidation,
dissolution or sale of such Person expressly permitted by the terms hereof or
the other Loan Documents, release any Borrower or any Guarantor from any
obligation for the payment of money,

                (j) amend any of the provisions of Section 2.4(b)(i) or (ii),

                (k) change the definition of Borrowing Base or the definitions
of Maximum Revolver Amount, Term Loan A Amount, Term Loan B Amount, or change
Section 2.1(b), or

                (l) amend any of the provisions of Section 15.

and, provided further, however, that no amendment, waiver or consent shall,
unless in writing and signed by Agent, Issuing Lender, or Swing Lender, as
applicable, affect the rights or duties of Agent, Issuing Lender, or Swing
Lender, as applicable, under this Agreement or any other Loan Document. The
foregoing notwithstanding, any amendment, modification, waiver, consent,
termination, or release of, or with respect to, any provision of this Agreement
or any other Loan Document that relates only to the relationship of the Lender
Group among themselves, and that does not affect the rights or obligations of
Borrowers, shall not require consent by or the agreement of Borrowers.

         14.2 Replacement of Holdout Lender.

                (a) If any action to be taken by the Lender Group or Agent
hereunder requires the unanimous consent, authorization, or agreement of all
Lenders, and a Lender ("Holdout Lender") fails to give its consent,
authorization, or agreement, then Agent, upon at least 5 Business Days prior
irrevocable notice to the Holdout Lender, may permanently replace the Holdout
Lender with one or more substitute Lenders (each, a "Replacement Lender"), and
the Holdout Lender shall have no right to refuse to be replaced hereunder. Such
notice to replace the Holdout Lender shall specify an effective date for such
replacement, which date shall not be later than 15 Business Days after the date
such notice is given.

                (b) Prior to the effective date of such replacement, the Holdout
Lender and each Replacement Lender shall execute and deliver an Assignment and
Acceptance, subject only to the Holdout Lender being repaid its share of the
outstanding Obligations (including an assumption of its Pro Rata Share of the
Risk Participation Liability) without any premium or penalty of any kind
whatsoever. If the Holdout Lender shall refuse or fail to execute and deliver
any such Assignment and Acceptance prior to the effective date of such
replacement, the Holdout Lender shall be deemed to have executed and delivered
such Assignment and Acceptance. The replacement of any Holdout Lender shall be
made in accordance with the terms of Section 13.1. Until such time as the
Replacement Lenders shall have acquired all of the Obligations, the Commitments,
and the other rights and obligations of the Holdout Lender hereunder and under
the other Loan Documents, the Holdout Lender shall remain obligated to make the
Holdout Lender's Pro Rata Share of Advances and to purchase a participation in
each Letter of Credit, in an amount equal to its Pro Rata Share of the Risk
Participation Liability of such Letter of Credit.

         14.3 No Waivers; Cumulative Remedies. No failure by Agent or any Lender
to exercise any right, remedy, or option under this Agreement or any other Loan
Document, or delay by Agent or any Lender in exercising the same, will operate
as a waiver thereof. No waiver by Agent or any Lender will be effective unless
it is in writing, and then only to the extent specifically stated. No waiver by
Agent or any Lender on any occasion shall affect or diminish Agent's and each
Lender's rights thereafter to require strict performance by Borrowers of any
provision of this Agreement. Agent's and each Lender's rights under this
Agreement and the other Loan Documents will be cumulative and not exclusive of
any other right or remedy that Agent or any Lender may have.

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15. AGENT; THE LENDER GROUP.

         15.1 Appointment and Authorization of Agent. Each Lender hereby
designates and appoints WFF as its representative under this Agreement and the
other Loan Documents and each Lender hereby irrevocably authorizes Agent to
execute and deliver each of the other Loan Documents on its behalf and to take
such other action on its behalf under the provisions of this Agreement and each
other Loan Document and to exercise such powers and perform such duties as are
expressly delegated to Agent by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental thereto. Agent
agrees to act as such on the express conditions contained in this Section 15.
The provisions of this Section 15 (other than the proviso to Section 15.11(a))
are solely for the benefit of Agent, and the Lenders, and Borrowers and their
Subsidiaries shall have no rights as a third party beneficiary of any of the
provisions contained herein. Any provision to the contrary contained elsewhere
in this Agreement or in any other Loan Document notwithstanding, Agent shall not
have any duties or responsibilities, except those expressly set forth herein,
nor shall Agent have or be deemed to have any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against Agent; it being expressly understood and
agreed that the use of the word "Agent" is for convenience only, that WFF is
merely the representative of the Lenders, and only has the contractual duties
set forth herein. Except as expressly otherwise provided in this Agreement,
Agent shall have and may use its sole discretion with respect to exercising or
refraining from exercising any discretionary rights or taking or refraining from
taking any actions that Agent expressly is entitled to take or assert under or
pursuant to this Agreement and the other Loan Documents. Without limiting the
generality of the foregoing, or of any other provision of the Loan Documents
that provides rights or powers to Agent, Lenders agree that Agent shall have the
right to exercise the following powers as long as this Agreement remains in
effect: (a) maintain, in accordance with its customary business practices,
ledgers and records reflecting the status of the Obligations, the Collateral,
the Collections of Borrowers and their Subsidiaries, and related matters, (b)
execute or file any and all financing or similar statements or notices,
amendments, renewals, supplements, documents, instruments, proofs of claim,
notices and other written agreements with respect to the Loan Documents, (c)
make Advances, for itself or on behalf of Lenders as provided in the Loan
Documents, (d) exclusively receive, apply, and distribute the Collections of
Borrowers and their Subsidiaries as provided in the Loan Documents, (e) open and
maintain such bank accounts and cash management arrangements as Agent deems
necessary and appropriate in accordance with the Loan Documents for the
foregoing purposes with respect to the Collateral and the Collections of
Borrowers and their Subsidiaries, (f) perform, exercise, and enforce any and all
other rights and remedies of the Lender Group with respect to Borrowers, the
Obligations, the Collateral, the Collections of Borrowers and their
Subsidiaries, or otherwise related to any of same as provided in the Loan
Documents, and (g) incur and pay such Lender Group Expenses as Agent may deem
necessary or appropriate for the performance and fulfillment of its functions
and powers pursuant to the Loan Documents.

         15.2 Delegation of Duties. Agent may execute any of its duties under
this Agreement or any other Loan Document by or through agents, employees or
attorneys in fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. Agent shall not be responsible for the
negligence or misconduct of any agent or attorney in fact that it selects as
long as such selection was made without gross negligence or willful misconduct.

         15.3 Liability of Agent. None of the Agent Related Persons shall (a) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (b) be responsible in any manner to any of the Lenders for any recital,
statement, representation or warranty made by any Borrower or any Subsidiary or
Affiliate of any Borrower, or any officer or director thereof, contained in this
Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by Agent
under or in connection with, this Agreement or any other Loan Document, or the
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document, or for any failure of any Borrower or any
other party to any Loan Document to perform its obligations hereunder or
thereunder. No Agent-Related Person shall be under any obligation to any Lender
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the books and records or properties of Borrowers or the
books or records or properties of any of Borrowers' Subsidiaries or Affiliates.

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<PAGE>

         15.4 Reliance by Agent. Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, telefacsimile or other electronic
method of transmission, telex or telephone message, statement or other document
or conversation believed by it to be genuine and correct and to have been
signed, sent, or made by the proper Person or Persons, and upon advice and
statements of legal counsel (including counsel to Borrowers or counsel to any
Lender), independent accountants and other experts selected by Agent. Agent
shall be fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless Agent shall first receive such
advice or concurrence of the Lenders as it deems appropriate and until such
instructions are received, Agent shall act, or refrain from acting, as it deems
advisable. If Agent so requests, it shall first be indemnified to its reasonable
satisfaction by the Lenders against any and all liability and expense that may
be incurred by it by reason of taking or continuing to take any such action.
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Loan Document in accordance with a
request or consent of the requisite Lenders and such request and any action
taken or failure to act pursuant thereto shall be binding upon all of the
Lenders.

         15.5 Notice of Default or Event of Default. Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of
Default, except with respect to defaults in the payment of principal, interest,
fees, and expenses required to be paid to Agent for the account of the Lenders
and, except with respect to Events of Default of which Agent has actual
knowledge, unless Agent shall have received written notice from a Lender or
Administrative Borrower referring to this Agreement, describing such Default or
Event of Default, and stating that such notice is a "notice of default." Agent
promptly will notify the Lenders of its receipt of any such notice or of any
Event of Default of which Agent has actual knowledge. If any Lender obtains
actual knowledge of any Event of Default, such Lender promptly shall notify the
other Lenders and Agent of such Event of Default. Each Lender shall be solely
responsible for giving any notices to its Participants, if any. Subject to
Section 15.4, Agent shall take such action with respect to such Default or Event
of Default as may be requested by the Required Lenders in accordance with
Section 8; provided, however, that unless and until Agent has received any such
request, Agent may (but shall not be obligated to) take such action, or refrain
from taking such action, with respect to such Default or Event of Default as it
shall deem advisable.

         15.6 Credit Decision. Each Lender acknowledges that none of the Agent
Related Persons has made any representation or warranty to it, and that no act
by Agent hereinafter taken, including any review of the affairs of Borrowers and
their Subsidiaries or Affiliates, shall be deemed to constitute any
representation or warranty by any Agent-Related Person to any Lender. Each
Lender represents to Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of Borrowers and any other Person party to a Loan Document, and
all applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to Borrowers. Each Lender also represents that it will, independently and
without reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of Borrowers and
any other Person party to a Loan Document. Except for notices, reports, and
other documents expressly herein required to be furnished to the Lenders by
Agent, Agent shall not have any duty or responsibility to provide any Lender
with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of
Borrowers and any other Person party to a Loan Document that may come into the
possession of any of the Agent Related Persons.

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<PAGE>

         15.7 Costs and Expenses; Indemnification. Agent may incur and pay
Lender Group Expenses to the extent Agent reasonably deems necessary or
appropriate for the performance and fulfillment of its functions, powers, and
obligations pursuant to the Loan Documents, including court costs, attorneys
fees and expenses, fees and expenses of financial accountants, advisors,
consultants, and appraisers, costs of collection by outside collection agencies,
auctioneer fees and expenses, and costs of security guards or insurance premiums
paid to maintain the Collateral, whether or not Borrowers are obligated to
reimburse Agent or Lenders for such expenses pursuant to this Agreement or
otherwise. Agent is authorized and directed to deduct and retain sufficient
amounts from the Collections of Borrowers and their Subsidiaries received by
Agent to reimburse Agent for such out-of-pocket costs and expenses prior to the
distribution of any amounts to Lenders. In the event Agent is not reimbursed for
such costs and expenses by Borrowers or their Subsidiaries, each Lender hereby
agrees that it is and shall be obligated to pay to Agent such Lender's Pro Rata
Share thereof. Whether or not the transactions contemplated hereby are
consummated, the Lenders shall indemnify upon demand the Agent-Related Persons
(to the extent not reimbursed by or on behalf of Borrowers and without limiting
the obligation of Borrowers to do so), according to their Pro Rata Shares, from
and against any and all Indemnified Liabilities; provided, however, that no
Lender shall be liable for the payment to any Agent-Related Person of any
portion of such Indemnified Liabilities resulting solely from such Person's
gross negligence or willful misconduct nor shall any Lender be liable for the
obligations of any Defaulting Lender in failing to make an Advance or other
extension of credit hereunder. Without limitation of the foregoing, each Lender
shall reimburse Agent upon demand for such Lender's Pro Rata Share of any costs
or out of pocket expenses (including attorneys, accountants, advisors, and
consultants fees and expenses) incurred by Agent in connection with the
preparation, execution, delivery, administration, modification, amendment, or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein,
to the extent that Agent is not reimbursed for such expenses by or on behalf of
Borrowers. The undertaking in this Section shall survive the payment of all
Obligations hereunder and the resignation or replacement of Agent.

         15.8 Agent in Individual Capacity. WFF and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in, and generally engage in any kind of banking, trust,
financial advisory, underwriting, or other business with Borrowers and their
Subsidiaries and Affiliates and any other Person party to any Loan Documents as
though WFF were not Agent hereunder, and, in each case, without notice to or
consent of the other members of the Lender Group. The other members of the
Lender Group acknowledge that, pursuant to such activities, WFF or its
Affiliates may receive information regarding Borrowers or their Affiliates and
any other Person party to any Loan Documents that is subject to confidentiality
obligations in favor of Borrowers or such other Person and that prohibit the
disclosure of such information to the Lenders, and the Lenders acknowledge that,
in such circumstances (and in the absence of a waiver of such confidentiality
obligations, which waiver Agent will use its reasonable best efforts to obtain),
Agent shall not be under any obligation to provide such information to them. The
terms "Lender" and "Lenders" include WFF in its individual capacity.

         15.9 Successor Agent. Agent may resign as Agent upon 45 days notice to
the Lenders (unless such notice is waived by the Required Lenders). If Agent
resigns under this Agreement, the Required Lenders shall appoint a successor
Agent for the Lenders. If no successor Agent is appointed prior to the effective
date of the resignation of Agent, Agent may appoint, after consulting with the
Lenders, a successor Agent. If Agent has materially breached or failed to
perform any material provision of this Agreement or of applicable law, the
Required Lenders may agree in writing to remove and replace Agent with a
successor Agent from among the Lenders. In any such event, upon the acceptance
of its appointment as successor Agent hereunder, such successor Agent shall
succeed to all the rights, powers, and duties of the retiring Agent and the term
"Agent" shall mean such successor Agent and the retiring Agent's appointment,
powers, and duties as Agent shall be terminated. After any retiring Agent's
resignation hereunder as Agent, the provisions of this Section 15 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Agreement. If no successor Agent has accepted appointment as
Agent by the date which is 45 days following a retiring Agent's notice of
resignation, the retiring Agent's resignation shall nevertheless thereupon
become effective and the Lenders shall perform all of the duties of Agent
hereunder until such time, if any, as the Lenders appoint a successor Agent as
provided for above.

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         15.10 Lender in Individual Capacity. Any Lender and its respective
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in and generally engage in any kind of
banking, trust, financial advisory, underwriting, or other business with
Borrowers and their Subsidiaries and Affiliates and any other Person party to
any Loan Documents as though such Lender were not a Lender hereunder without
notice to or consent of the other members of the Lender Group. The other members
of the Lender Group acknowledge that, pursuant to such activities, such Lender
and its respective Affiliates may receive information regarding Borrowers or
their Affiliates and any other Person party to any Loan Documents that is
subject to confidentiality obligations in favor of Borrowers or such other
Person and that prohibit the disclosure of such information to the Lenders, and
the Lenders acknowledge that, in such circumstances (and in the absence of a
waiver of such confidentiality obligations, which waiver such Lender will use
its reasonable best efforts to obtain), such Lender shall not be under any
obligation to provide such information to them.

         15.11 Withholding Taxes.

                (a) With respect to all Taxes which are not Excluded Taxes, all
payments made by any Borrower hereunder or under any note or other Loan Document
will be made without setoff, counterclaim, or other defense. In addition, all
such payments will be made free and clear of, and without deduction or
withholding for, any present or future Taxes, and in the event any deduction or
withholding of Taxes is required, each Borrower shall comply with the
penultimate sentence of this Section 15.11(a). If any Non-Excluded Taxes are so
levied or imposed, each Borrower agrees to pay the full amount of such
Non-Excluded Taxes and such additional amounts as may be necessary so that every
payment of all amounts due under this Agreement, any note, or Loan Document,
including any amount paid pursuant to this Section 15.11(a) after withholding or
deduction for or on account of any Non-Excluded Taxes, will not be less than the
amount provided for herein; provided, however, that Borrowers shall not be
required to increase any such amounts if the increase in such amount payable
results from Agent's or such Lender's own willful misconduct or gross negligence
(as finally determined by a court of competent jurisdiction) or the Agent's or
Lender's failure to comply with Section 15.11(b) or Section 15.11(c) of this
Agreement. Each Borrower will furnish to Agent as promptly as possible after the
date the payment of any Tax is due written evidence of such payment by any
Borrower. If a Lender or Agent determines, in its sole discretion, that it has
received a refund credit of any Taxes as to which it has been indemnified by the
Borrowers, so long as no Default or Event of Default has occurred and is
continuing, it shall pay over such refund credit to the respective Borrower
(but only to the extent of payments made by such Borrower under this Section
15.11 with respect to Taxes giving rise to such a refund credit), net of all
reasonable out-of-pocket expenses of Agent or Lenders and without interest
(other than any interest paid by the relevant governmental authority with
respect to such a refund); provided, that each Borrower, upon the request of a
Lender or Agent, agrees to repay the amount paid over to such Borrower (plus any
penalties, interest or other charges, imposed by the relevant governmental
authority, other than such penalties, interest or other charges imposed as a
result of the willful misconduct or gross negligence of Agent hereunder) to
such Lender or Agent in the event such Lender or Agent is required to repay such
refund to such governmental authority. Except as expressly provided for in this
Section 15.11, this Section shall not be construed to require any Lender or
Agent to make available its tax returns (or any other information relating to
its taxes which it deems confidential) to any Borrower or any other person.

                (b) If a Lender claims an exemption from United States income
tax which is required to be withheld by Borrowers ("Withholding Tax"), Lender
agrees with and in favor of Agent and any Borrower, to deliver to Agent and
Borrower:

                        (i) if such claim for exemption depends on portfolio
interest exception as set forth in Sections 871(h) and 881(c) of the IRC, (A) a
statement of the Lender, signed under penalty of perjury, that it is not a (I) a
"bank" as described in Section 881(c)(3)(A) of the IRC, (II) a 10% shareholder
of any Borrower (within the meaning of Section 871(h)(3)(B) of the IRC), or

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<PAGE>

(III) a controlled foreign corporation related to any Borrower within the
meaning of Section 864(d)(4) of the IRC, and (B) a properly completed and
executed IRS Form W-8BEN, at least fifteen (15) days before receiving its first
payment under this Agreement and at any other time reasonably requested by Agent
or any Borrower;

                        (ii) if such claim of an exemption, or a reduction of,
tax under a United States tax treaty, a properly completed and executed IRS Form
W-8BEN at least fifteen (15) days before receiving its first payment under this
Agreement and at any other time reasonably requested by Agent or any Borrower;

                        (iii) if such claim depends on a representation that
interest paid under this Agreement is effectively connected with a United States
trade or business of such Lender, two properly completed and executed copies of
IRS Form W-8ECI at least fifteen (15) days before receiving its first payment
under this Agreement and at any other time reasonably requested by Agent or any
Borrower; or

                        (iv) such other form or forms, including IRS Form W-9,
as may be required under the IRC or other laws of the United States as a
condition to exemption from, or reduction of, United States withholding or
backup withholding tax at least fifteen (15) days before receiving its first
payment under this Agreement and at any other time reasonably requested by Agent
or any Borrower.

Lender agrees promptly to notify Agent and Administrative Borrower of any change
in circumstances which would modify or render invalid any claimed exemption or
reduction.

                (c) If a Lender claims an exemption from income tax for which
Borrower is required by a jurisdiction other than the United States to withhold
such tax ("Non-US Withholding Tax"), Lender agrees with and in favor of Agent
and Borrowers, to deliver to Agent any such form or forms, as may be required
under the laws of such jurisdiction as a condition to exemption from, or
reduction of, Non-US Withholding Tax at least fifteen (15) days before receiving
its first payment under this Agreement and at any other time reasonably
requested by Agent or Administrative Borrower.

Lender agrees promptly to notify Agent and Administrative Borrower of any change
in circumstances which would modify or render invalid any claimed exemption or
reduction.

                (d) If any Lender claims exemption from, or reduction of,
withholding tax and such Lender sells, assigns, grants a participation in, or
otherwise transfers all or part of the Obligations of Borrowers to such Lender,
such Lender agrees to notify Agent and Administrative Borrower of the percentage
amount in which it is no longer the beneficial owner of Obligations of Borrowers
to such Lender. To the extent of such percentage amount, Agent and Borrowers
will treat such Lender's documentation provided pursuant to Sections 15.11(b) or
15.11(c) as no longer valid. With respect to such percentage amount, Lender may
provide new documentation, pursuant to Sections 15.11(b) or 15.11(c), if
applicable at least fifteen (15) days prior to the effective date of such
transfer or assignment.

                (e) If any Lender is entitled to a reduction in the applicable
Withholding Tax or non-U.S. Withholding Tax, Agent may withhold from any
interest payment to such Lender an amount equivalent to the applicable
Withholding Tax after taking into account such reduction. If the forms or other
documentation required by subsection (b) or (c) of this Section 15.11 are not
delivered to Agent, then Agent may withhold from any interest payment to such
Lender not providing such forms or other documentation an amount equivalent to
the applicable Withholding Tax.

                (f) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that any Borrower or Agent did not
properly withhold tax from amounts paid to or for the account of any Lender due
to a failure on the part of the Lender (because the appropriate form was not
delivered, was not properly executed, or because such Lender failed to notify
any Borrower or Agent of a change in circumstances which rendered the exemption

                                       54
<PAGE>

from, or reduction of, withholding tax ineffective, or for any other reason)
such Lender shall indemnify and hold any Borrower or Agent harmless for all
amounts paid, directly or indirectly, by any Borrower or Agent, as tax or
otherwise, including penalties and interest, and including any taxes imposed by
any jurisdiction on the amounts payable to any Borrower or Agent under this
Section 15.11, together with all costs and expenses (including attorneys fees
and expenses). The obligation of the Lenders under this subsection shall survive
the payment of all Obligations and the resignation or replacement of Agent.

         15.12 Collateral Matters. (a) The Lenders hereby irrevocably authorize
Agent, at its option and in its sole discretion, to release any Lien on any
Collateral (i) upon the termination of the Commitments and payment and
satisfaction in full by Borrowers of all Obligations, (ii) constituting property
being sold or disposed of if a release is required or desirable in connection
therewith and if Administrative Borrower certifies to Agent that the sale or
disposition is permitted under Section 6.4 of this Agreement or the other Loan
Documents (and Agent may rely conclusively on any such certificate, without
further inquiry), (iii) constituting property in which no Borrower or its
Subsidiaries owned any interest at the time the Agent's Lien was granted nor at
any time thereafter, or (iv) constituting property leased to a Borrower or its
Subsidiaries under a lease that has expired or is terminated in a transaction
permitted under this Agreement. Except as provided above, Agent will not execute
and deliver a release of any Lien on any Collateral without the prior written
authorization of (y) if the release is of all or substantially all of the
Collateral, all of the Lenders, or (z) otherwise, the Required Lenders. Upon
request by Agent or Administrative Borrower at any time, the Lenders will
confirm in writing Agent's authority to release any such Liens on particular
types or items of Collateral pursuant to this Section 15.12; provided, however,
that (1) Agent shall not be required to execute any document necessary to
evidence such release on terms that, in Agent's opinion, would expose Agent to
liability or create any obligation or entail any consequence other than the
release of such Lien without recourse, representation, or warranty, and (2) such
release shall not in any manner discharge, affect, or impair the Obligations or
any Liens (other than those expressly being released) upon (or obligations of
Borrowers in respect of) all interests retained by Borrowers, including, the
proceeds of any sale, all of which shall continue to constitute part of the
Collateral.

                (b) Agent shall have no obligation whatsoever to any of the
Lenders to assure that the Collateral exists or is owned by Borrowers or is
cared for, protected, or insured or has been encumbered, or that the Agent's
Liens have been properly or sufficiently or lawfully created, perfected,
protected, or enforced or are entitled to any particular priority, or to
exercise at all or in any particular manner or under any duty of care,
disclosure or fidelity, or to continue exercising, any of the rights,
authorities and powers granted or available to Agent pursuant to any of the Loan
Documents, it being understood and agreed that in respect of the Collateral, or
any act, omission, or event related thereto, subject to the terms and conditions
contained herein, Agent may act in any manner it may deem appropriate, in its
sole discretion given Agent's own interest in the Collateral in its capacity as
one of the Lenders and that Agent shall have no other duty or liability
whatsoever to any Lender as to any of the foregoing, except as otherwise
provided herein.

         15.13    Restrictions on Actions by Lenders; Sharing of Payments.

                (a) Each of the Lenders agrees that it shall not, without the
express written consent of Agent, and that it shall, to the extent it is
lawfully entitled to do so, upon the written request of Agent, set off against
the Obligations, any amounts owing by such Lender to Borrowers or any deposit
accounts of Borrowers now or hereafter maintained with such Lender. Each of the
Lenders further agrees that it shall not, unless specifically requested to do so
in writing by Agent, take or cause to be taken any action, including, the
commencement of any legal or equitable proceedings, to foreclose any Lien on, or
otherwise enforce any security interest in, any of the Collateral.

                (b) If, at any time or times any Lender shall receive (i) by
payment, foreclosure, setoff, or otherwise, any proceeds of Collateral or any
payments with respect to the Obligations, except for any such proceeds or
payments received by such Lender from Agent pursuant to the terms of this
Agreement, or (ii) payments from Agent in excess of such Lender's Pro Rata Share

                                       55
<PAGE>

of all such distributions by Agent, such Lender promptly shall (A) turn the same
over to Agent, in kind, and with such endorsements as may be required to
negotiate the same to Agent, or in immediately available funds, as applicable,
for the account of all of the Lenders and for application to the Obligations in
accordance with the applicable provisions of this Agreement, or (B) purchase,
without recourse or warranty, an undivided interest and participation in the
Obligations owed to the other Lenders so that such excess payment received shall
be applied ratably as among the Lenders in accordance with their Pro Rata
Shares; provided, however, that to the extent that such excess payment received
by the purchasing party is thereafter recovered from it, those purchases of
participations shall be rescinded in whole or in part, as applicable, and the
applicable portion of the purchase price paid therefor shall be returned to such
purchasing party, but without interest except to the extent that such purchasing
party is required to pay interest in connection with the recovery of the excess
payment.

         15.14 Agency for Perfection. Agent hereby appoints each other Lender as
its agent (and each Lender hereby accepts such appointment) for the purpose of
perfecting the Agent's Liens in assets which, in accordance with Article 8 or
Article 9, as applicable, of the Code can be perfected only by possession or
control. Should any Lender obtain possession or control of any such Collateral,
such Lender shall notify Agent thereof, and, promptly upon Agent's request
therefor shall deliver possession or control of such Collateral to Agent or in
accordance with Agent's instructions.

         15.15 Payments by Agent to the Lenders. All payments to be made by
Agent to the Lenders shall be made by bank wire transfer of immediately
available funds pursuant to such wire transfer instructions as each party may
designate for itself by written notice to Agent. Concurrently with each such
payment, Agent shall identify whether such payment (or any portion thereof)
represents principal, premium, fees, or interest of the Obligations.

         15.16 Concerning the Collateral and Related Loan Documents. Each member
of the Lender Group authorizes and directs Agent to enter into this Agreement
and the other Loan Documents. Each member of the Lender Group agrees that any
action taken by Agent in accordance with the terms of this Agreement or the
other Loan Documents relating to the Collateral and the exercise by Agent of its
powers set forth therein or herein, together with such other powers that are
reasonably incidental thereto, shall be binding upon all of the Lenders.

         15.17 Field Audits and Examination Reports; Confidentiality;
Disclaimers by Lenders; Other Reports and Information. By becoming a party to
this Agreement, each Lender:

                (a) is deemed to have requested that Agent furnish such Lender,
promptly after it becomes available, a copy of each field audit or examination
report (each a "Report" and collectively, "Reports") prepared by or at the
request of Agent, and Agent shall so furnish each Lender with such Reports,

                (b) expressly agrees and acknowledges that Agent does not (i)
make any representation or warranty as to the accuracy of any Report, and (ii)
shall not be liable for any information contained in any Report,

                (c) expressly agrees and acknowledges that the Reports are not
comprehensive audits or examinations, that Agent or other party performing any
audit or examination will inspect only specific information regarding Borrowers
and will rely significantly upon Borrowers' and their Subsidiaries' books and
records, as well as on representations of Borrowers' personnel,

                (d) agrees to keep all Reports and other material, non-public
information regarding Borrowers and their Subsidiaries and their operations,
assets, and existing and contemplated business plans in a confidential manner in
accordance with Section 16.7, and

                                       56
<PAGE>

                (e) without limiting the generality of any other indemnification
provision contained in this Agreement, agrees: (i) to hold Agent and any such
other Lender preparing a Report harmless from any action the indemnifying Lender
may take or fail to take or any conclusion the indemnifying Lender may reach or
draw from any Report in connection with any loans or other credit accommodations
that the indemnifying Lender has made or may make to Borrowers, or the
indemnifying Lender's participation in, or the indemnifying Lender's purchase
of, a loan or loans of Borrowers; and (ii) to pay and protect, and indemnify,
defend and hold Agent, and any such other Lender preparing a Report harmless
from and against, the claims, actions, proceedings, damages, costs, expenses,
and other amounts (including, attorneys fees and costs) incurred by Agent and
any such other Lender preparing a Report as the direct or indirect result of any
third parties who might obtain all or part of any Report through the
indemnifying Lender.

In addition to the foregoing: (x) any Lender may from time to time request of
Agent in writing that Agent provide to such Lender a copy of any report or
document provided by Borrowers to Agent that has not been contemporaneously
provided by Borrowers to such Lender, and, upon receipt of such request, Agent
promptly shall provide a copy of same to such Lender, (y) to the extent that
Agent is entitled, under any provision of the Loan Documents, to request
additional reports or information from Borrowers, any Lender may, from time to
time, reasonably request Agent to exercise such right as specified in such
Lender's notice to Agent, whereupon Agent promptly shall request of
Administrative Borrower the additional reports or information reasonably
specified by such Lender, and, upon receipt thereof from Administrative
Borrower, Agent promptly shall provide a copy of same to such Lender, and (z)
any time that Agent renders to Administrative Borrower a statement regarding the
Loan Account, Agent shall send a copy of such statement to each Lender.

         15.18 Several Obligations; No Liability. Notwithstanding that certain
of the Loan Documents now or hereafter may have been or will be executed only by
or in favor of Agent in its capacity as such, and not by or in favor of the
Lenders, any and all obligations on the part of Agent (if any) to make any
credit available hereunder shall constitute the several (and not joint)
obligations of the respective Lenders on a ratable basis, according to their
respective Commitments, to make an amount of such credit not to exceed, in
principal amount, at any one time outstanding, the amount of their respective
Commitments. Nothing contained herein shall confer upon any Lender any interest
in, or subject any Lender to any liability for, or in respect of, the business,
assets, profits, losses, or liabilities of any other Lender. Each Lender shall
be solely responsible for notifying its Participants of any matters relating to
the Loan Documents to the extent any such notice may be required, and no Lender
shall have any obligation, duty, or liability to any Participant of any other
Lender. Except as provided in Section 15.7, no member of the Lender Group shall
have any liability for the acts of any other member of the Lender Group. No
Lender shall be responsible to any Borrower or any other Person for any failure
by any other Lender to fulfill its obligations to make credit available
hereunder, nor to advance for it or on its behalf in connection with its
Commitment, nor to take any other action on its behalf hereunder or in
connection with the financing contemplated herein.

         15.19 Bank Product Providers. Each Bank Product Provider shall be
deemed a party hereto for purposes of any reference in a Loan Document to the
parties for whom Agent is acting; it being understood and agreed that the rights
and benefits of such Bank Product Provider under the Loan Documents consist
exclusively of such Bank Product Provider's right to share in payments and
collections out of the Collateral as more fully set forth herein. In connection
with any such distribution of payments and collections, Agent shall be entitled
to assume no amounts are due to any Bank Product Provider unless such Bank
Product Provider has notified Agent in writing of the amount of any such
liability owed to it prior to such distribution.

16. GENERAL PROVISIONS.

         16.1 Effectiveness. This Agreement shall be binding and deemed
effective when executed by Borrowers, Agent, and each Lender whose signature is
provided for on the signature pages hereof.

         16.2 Section Headings. Headings and numbers have been set forth herein
for convenience only. Unless the contrary is compelled by the context,
everything contained in each Section applies equally to this entire Agreement.

                                       57
<PAGE>

         16.3 Interpretation. Neither this Agreement nor any uncertainty or
ambiguity herein shall be construed against the Lender Group or Borrowers,
whether under any rule of construction or otherwise. On the contrary, this
Agreement has been reviewed by all parties and shall be construed and
interpreted according to the ordinary meaning of the words used so as to
accomplish fairly the purposes and intentions of all parties hereto.

         16.4 Severability of Provisions. Each provision of this Agreement
shall be severable from every other provision of this Agreement for the purpose
of determining the legal enforceability of any specific provision.

         16.5 Counterparts; Electronic Execution. This Agreement may be executed
in any number of counterparts and by different parties on separate counterparts,
each of which, when executed and delivered, shall be deemed to be an original,
and all of which, when taken together, shall constitute but one and the same
Agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile or other electronic method of transmission shall be equally as
effective as delivery of an original executed counterpart of this Agreement. Any
party delivering an executed counterpart of this Agreement by telefacsimile or
other electronic method of transmission also shall deliver an original executed
counterpart of this Agreement but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Agreement. The foregoing shall apply to each other Loan Document mutatis
mutandis.

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

         16.7 Confidentiality.

                (a) Agent and Lenders each individually (and not jointly or
jointly and severally) agree that material, non-public information regarding
Borrowers and their Subsidiaries, their operations, assets, and existing and
contemplated business plans shall be treated by Agent and the Lenders in a
confidential manner, and shall not be disclosed by Agent and the Lenders to
Persons who are not parties to this Agreement, except: (i) to attorneys for and
other advisors, accountants, auditors, and consultants to any member of the
Lender Group, (ii) to Subsidiaries and Affiliates of any member of the Lender
Group (including the Bank Product Providers), provided that any such Subsidiary
or Affiliate shall have agreed to receive such information hereunder subject to
the terms of this Section 16.7, (iii) as may be required by statute, decision,
or judicial or administrative order, rule, or regulation, (iv) as may be agreed
to in advance by Administrative Borrower or its Subsidiaries or as requested or
required by any Governmental Authority pursuant to any subpoena or other legal
process, (v) as to any such information that is or becomes generally available
to the public (other than as a result of prohibited disclosure by Agent or the
Lenders), (vi) in connection with any assignment, participation or pledge of any
Lender's interest under this Agreement, provided that any such assignee,
participant, or pledgee shall have agreed in writing to receive such information
hereunder subject to the terms of this Section, and (vii) in connection with any
litigation or other adversary proceeding involving parties hereto which such
litigation or adversary proceeding involves claims related to the rights or
duties of such parties under this Agreement or the other Loan Documents. The
provisions of this Section 16.7(a) shall survive for 2 years after the payment
in full of the Obligations.

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<PAGE>

                (b) Anything in this Agreement to the contrary notwithstanding,
Agent may provide information concerning the terms and conditions of this
Agreement and the other Loan Documents to loan syndication and pricing reporting
services.

         16.8 Lender Group Expenses. Borrowers agree to pay any and all Lender
Group Expenses promptly after demand therefor by Agent and agrees that their
obligations contained in this Section 16.8 shall survive payment or satisfaction
in full of all other Obligations.

         16.9 USA PATRIOT Act. Each Lender that is subject to the requirements
of the USA Patriot Act (Title 111 of Pub. L. 107-56 (signed into law October 26,
2001)) (the "Act") hereby notifies Borrowers that pursuant to the requirements
of the Act, it is required to obtain, verify and record information that
identifies Borrowers, which information includes the name and address of
Borrowers and other information that will allow such Lender to identify
Borrowers in accordance with the Act.

         16.10 Integration. This Agreement, together with the other Loan
Documents, reflects the entire understanding of the parties with respect to the
transactions contemplated hereby and shall not be contradicted or qualified by
any other agreement, oral or written, before the date hereof.

         16.11 Parent as Agent for Borrowers. Each Borrower hereby irrevocably
appoints Parent as the borrowing agent and attorney-in-fact for all Borrowers
(the "Administrative Borrower") which appointment shall remain in full force and
effect unless and until Agent shall have received prior written notice signed by
each Borrower that such appointment has been revoked and that another Borrower
has been appointed Administrative Borrower. Each Borrower hereby irrevocably
appoints and authorizes the Administrative Borrower (i) to provide Agent with
all notices with respect to Advances and Letters of Credit obtained for the
benefit of any Borrower and all other notices and instructions under this
Agreement and (ii) to take such action as the Administrative Borrower deems
appropriate on its behalf to obtain Advances and Letters of Credit and to
exercise such other powers as are reasonably incidental thereto to carry out the
purposes of this Agreement. It is understood that the handling of the Loan
Account and Collateral of Borrowers in a combined fashion, as more fully set
forth herein, is done solely as an accommodation to Borrowers in order to
utilize the collective borrowing powers of Borrowers in the most efficient and
economical manner and at their request, and that Lender Group shall not incur
liability to any Borrower as a result hereof. Each Borrower expects to derive
benefit, directly or indirectly, from the handling of the Loan Account and the
Collateral in a combined fashion since the successful operation of each Borrower
is dependent on the continued successful performance of the integrated group. To
induce the Lender Group to do so, and in consideration thereof, each Borrower
hereby jointly and severally agrees to indemnify each member of the Lender Group
and hold each member of the Lender Group harmless against any and all liability,
expense, loss or claim of damage or injury, made against the Lender Group by any
Borrower or by any third party whosoever, arising from or incurred by reason of
(a) the handling of the Loan Account and Collateral of Borrowers as herein
provided, (b) the Lender Group's relying on any instructions of the
Administrative Borrower, or (c) any other action taken by the Lender Group
hereunder or under the other Loan Documents, except that Borrowers will have no
liability to the relevant Agent-Related Person or Lender-Related Person under
this Section 16.11 with respect to any liability that has been finally
determined by a court of competent jurisdiction to have resulted solely from the
gross negligence or willful misconduct of such Agent-Related Person or
Lender-Related Person, as the case may be.

                          [Signature pages to follow.]

                                       59
<PAGE>

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

                                        ORION HEALTHCORP, INC.

                                        By:           /s/ Terrence L. Bauer
                                        Title:        President

                                        INTEGRATED PHYSICIAN SOLUTIONS, INC.

                                        By:           /s/ Terrence L. Bauer
                                        Title:        President

                                        MEDICAL BILLING SERVICES, INC.

                                        By:              /s/ Stephen H. Murdock
                                        Title:           Secretary

                                        ON-LINE ALTERNATIVES, INC.

                                        By:              /s/ Terrence L. Bauer
                                        Title:           Chief Executive Officer

                                        ON LINE PAYROLL SERVICES, INC.

                                        By:              /s/ Terrence L. Bauer
                                        Title:           Chief Executive Officer

                                        RAND MEDICAL BILLING, INC.

                                        By:              /s/ Terrence L. Bauer
                                        Title:           Chief Executive Officer

                                        WELLS FARGO FOOTHILL, INC.,
                                        a California corporation, as Agent
                                        and as a Lender

                                        By:           /s/ Daniel Morihiro
                                        Title:        Vice President

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page

1.   DEFINITIONS AND CONSTRUCTION..............................................1

     1.1      Definitions......................................................1

     1.2      Accounting Terms.................................................1

     1.3      Code.............................................................1

     1.4      Construction.....................................................1

     1.5      Schedules and Exhibits...........................................2

2.   LOAN AND TERMS OF PAYMENT.................................................2

     2.1      Revolver Advances................................................2

     2.2      Term Loans.......................................................2

     2.3      Borrowing Procedures and Settlements.............................3

     2.4      Payments.........................................................8

     2.5      Overadvances....................................................11

     2.6      Interest Rates and Letter of Credit Fee:  Rates,
              Payments, and Calculations......................................12

     2.7      Cash Management.................................................13

     2.8      Crediting Payments..............................................15

     2.9      Designated Account..............................................15

     2.10     Maintenance of Loan Account; Statements of Obligations..........15

     2.11     Fees............................................................15

     2.12     Letters of Credit...............................................15

     2.13     LIBOR Option....................................................18

     2.14     Capital Requirements............................................20

     2.15     Joint and Several Liability of Borrowers........................20

3.   CONDITIONS; TERM OF AGREEMENT............................................23

     3.1      Conditions Precedent to the Initial Extension of Credit.........23

     3.2      Conditions Precedent to all Extensions of Credit................23

     3.3      Term............................................................24

     3.4      Effect of Termination...........................................24

     3.5      Early Termination by Borrowers..................................25

4.   REPRESENTATIONS AND WARRANTIES...........................................25

     4.1      No Encumbrances.................................................25

     4.2      Healthcare Matters..............................................25

     4.3      Equipment.......................................................27

     4.4      Location of Inventory and Equipment.............................27

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     4.5      Inventory Records...............................................27

     4.6      Jurisdiction of Organization; Location of Chief Executive
              Office; Organizational Identification Number; Commercial
               Tort Claims....................................................27

     4.7      Due Organization and Qualification; Subsidiaries................28

     4.8      Due Authorization; No Conflict..................................28

     4.9      Litigation......................................................29

     4.10     No Material Adverse Change......................................30

     4.11     Fraudulent Transfer.............................................30

     4.12     Employee Benefits...............................................30

     4.13     Environmental Condition.........................................30

     4.14     Intellectual Property...........................................30

     4.15     Leases..........................................................30

     4.16     Deposit Accounts and Securities Accounts........................31

     4.17     Complete Disclosure.............................................31

     4.18     Indebtedness....................................................31

5.   AFFIRMATIVE COVENANTS....................................................31

     5.1      Accounting System...............................................31

     5.2      Collateral Reporting............................................31

     5.3      Financial Statements, Reports, Certificates.....................32

     5.4      Guarantor Reports...............................................32

     5.5      Inspection......................................................32

     5.6      Maintenance of Properties.......................................32

     5.7      Taxes...........................................................32

     5.8      Insurance.......................................................32

     5.9      Location of Inventory and Equipment.............................32

     5.10     Compliance with Laws............................................33

     5.11     Leases..........................................................33

     5.12     Existence.......................................................33

     5.13     Environmental...................................................33

     5.14     Disclosure Updates..............................................33

     5.15     Control Agreements..............................................33

     5.16     Formation of Subsidiaries.......................................33

     5.17     Further Assurances..............................................34

     5.18     Healthcare Covenants............................................34

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                                TABLE OF CONTENTS
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6.   NEGATIVE COVENANTS.......................................................36

     6.1      Indebtedness....................................................36

     6.2      Liens...........................................................36

     6.3      Restrictions on Fundamental Changes.............................36

     6.4      Disposal of Assets..............................................36

     6.5      Change Name.....................................................36

     6.6      Nature of Business..............................................36

     6.7      Prepayments and Amendments......................................37

     6.8      Change of Control...............................................37

     6.9      Consignments....................................................37

     6.10     Distributions...................................................37

     6.11     Accounting Methods..............................................37

     6.12     Investments.....................................................37

     6.13     Transactions with Affiliates....................................37

     6.14     Use of Proceeds.................................................38

     6.15     Inventory and Equipment with Bailees............................38

     6.16     Financial Covenants.............................................38

7.   EVENTS OF DEFAULT........................................................40

8.   THE LENDER GROUP'S RIGHTS AND REMEDIES...................................42

     8.1      Rights and Remedies.............................................42

     8.2      Remedies Cumulative.............................................43

9.   TAXES AND EXPENSES.......................................................43

10.  WAIVERS; INDEMNIFICATION.................................................43

     10.1     Demand; Protest; etc............................................43

     10.2     The Lender Group's Liability for Collateral.....................43

     10.3     Indemnification.................................................43

11.  NOTICES..................................................................44

12.  CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER...............................45

13.  ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS...............................46

     13.1     Assignments and Participations..................................46

     13.2     Successors......................................................48

14.  AMENDMENTS; WAIVERS......................................................48

     14.1     Amendments and Waivers..........................................48

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     14.2     Replacement of Holdout Lender...................................49

     14.3     No Waivers; Cumulative Remedies.................................49

15.  AGENT; THE LENDER GROUP..................................................49

     15.1     Appointment and Authorization of Agent..........................50

     15.2     Delegation of Duties............................................50

     15.3     Liability of Agent..............................................50

     15.4     Reliance by Agent...............................................51

     15.5     Notice of Default or Event of Default...........................51

     15.6     Credit Decision.................................................51

     15.7     Costs and Expenses; Indemnification.............................52

     15.8     Agent in Individual Capacity....................................52

     15.9     Successor Agent.................................................52

     15.10    Lender in Individual Capacity...................................53

     15.11    Withholding Taxes...............................................53

     15.12    Collateral Matters..............................................55

     15.13    Restrictions on Actions by Lenders; Sharing of Payments.........55

     15.14    Agency for Perfection...........................................56

     15.15    Payments by Agent to the Lenders................................56

     15.16    Concerning the Collateral and Related Loan Documents............56

     15.17    Field Audits and Examination Reports; Confidentiality;
              Disclaimers by Lenders; Other  Reports and Information..........56

     15.18    Several Obligations; No Liability...............................57

     15.19    Bank Product Providers..........................................57

16.  GENERAL PROVISIONS.......................................................57

     16.1     Effectiveness...................................................57

     16.2     Section Headings................................................57

     16.3     Interpretation..................................................58

     16.4     Severability of Provisions......................................58

     16.5     Counterparts; Electronic Execution..............................58

     16.6     Revival and Reinstatement of Obligations........................58

     16.7     Confidentiality.................................................58

     16.8     Lender Group Expenses...........................................59

     16.9     USA PATRIOT Act.................................................59

     16.10    Integration.....................................................59

     16.11    Parent as Agent for Borrowers...................................59

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                             EXHIBITS AND SCHEDULES

Exhibit A-1                         Form of Assignment and Acceptance
Exhibit B-1                         Form of Borrowing Base Certificate
Exhibit C-1                         Form of Compliance Certificate
Exhibit L-1                         Form of LIBOR Notice

Schedule A-1                        Agent's Account
Schedule C-1                        Commitments
Schedule D-1                        Designated Account
Schedule P-2                        Permitted Liens
Schedule S-1                        Subordination Agreements
Schedule 1.1                        Definitions
Schedule 2.7(a)                     Cash Management Banks
Schedule 2.7(i)                     Payroll Accounts
Schedule 3.1                        Conditions Precedent
Schedule 4.2(b)                     Medicaid and Medicare Providers
Schedule 4.4                        Locations of Inventory and Equipment
Schedule 4.6(a)                     States of Organization
Schedule 4.6(b)                     Chief Executive Offices
Schedule 4.6(c)                     Organizational Identification Numbers
Schedule 4.6(d)                     Commercial Tort Claims
Schedule 4.7(b)                     Capitalization of Borrowers
Schedule 4.7(c)                     Capitalization of Borrowers' Subsidiaries
Schedule 4.9                        Litigation
Schedule 4.13                       Environmental Matters
Schedule 4.14                       Intellectual Property
Schedule 4.16                       Deposit Accounts and Securities Accounts
Schedule 4.18                       Permitted Indebtedness
Schedule 5.2                        Collateral Reporting
Schedule 5.3                        Financial Statements, Reports, Certificates
Schedule 6.6                        Description of Business

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