Document:

Form of 2006 Stock Appreciation Rights Plan for Directors

 EXHIBIT 10.2 
  
  
  
  
 AZZ incorporated 
 FISCAL YEAR 2006 STOCK APPRECIATION RIGHTS 
 PLAN FOR DIRECTORS 
  
 DATED MAY 18, 2005 

 AZZ incorporated 
 FISCAL YEAR 2006 STOCK APPRECIATION RIGHTS 
 PLAN FOR DIRECTORS 
  
 TABLE OF CONTENTS 
  
 ARTICLE 1 Purpose of Plan 
  
 ARTICLE 2 Administration of Plan 
  
 ARTICLE 3 Eligibility and Grant 
  
 ARTICLE 4 Terms of Rights 
  
 ARTICLE 5
Limitations on Number of Rights and Date of Grant 
  
 ARTICLE 6 Appreciation
Amount 
  
 ARTICLE 7 Payment of Appreciation Amount 
  
 ARTICLE 8 Nature of Rights 
  
 ARTICLE 9 Termination of Rights 
  
 ARTICLE 10 Adjustment to Rights 
  
 ARTICLE 11 Termination and Amendment 
  
 ARTICLE
12 Rights Agreement 
  
 ARTICLE 13 Miscellaneous Provisions 
  
 ARTICLE 14 Definitions 

 AZZ incorporated, a Texas corporation (the “Company”), hereby establishes and sets forth the
terms of the AZZ incorporated, FISCAL YEAR 2006 STOCK APPRECIATION RIGHTS PLAN FOR DIRECTORS (the “Plan”) to be effective May 18, 2005. 
  
 ARTICLE 1. PURPOSE OF PLAN 
  
 The purpose of this Plan is to enable the Company to attract and retain directors of the highest caliber by offering to them an opportunity to share in
increases in the value of the Company to which they contribute. This Plan will seek to accomplish this purpose by granting such directors stock appreciation rights (collectively, the “Rights” and individually, a “Right”), which
will be associated with shares of common stock of the Company, one dollar ($1.00) par value (the “Common Stock”), and which will be subject to all of the terms and conditions contained in this Plan. 
  
 ARTICLE 2. ADMINISTRATION OF PLAN 
  
 2.1 This Plan shall be administered by the Nominating and Corporate
Governance Committee of the Board of Directors of the Company (the “Administrative Committee”). 
  
 2.2 A majority of the members of the Administrative Committee shall constitute a quorum. All actions of the Administrative Committee shall require
the affirmative vote of members who constitute a majority of such quorum. 
  
 2.3 The Administrative Committee shall have the following rights and powers: 
  

	 	(a)	The Administrative Committee shall have the authority (i) to administer this Plan in accordance with its express terms; (ii) to determine all questions arising in connection with
the administration, interpretation, and application of this Plan, including all questions relating to the fair market value of the Common Stock; (iii) to correct any defect, supply any information and reconcile any inconsistency in the Plan in such
manner and to such extent as shall be deemed necessary or advisable to carry out the purpose of this Plan; (iv) to prescribe, amend and rescind rules and regulations relating to the administration of this Plan; and (v) to make all other
determinations and to take all actions necessary or advisable for administration of this Plan provided, however, no action taken under the authority of this Section 2.3(a) shall be contrary to any specific provisions in the Plan.

  

	 	(b)	All determinations made by the Administrative Committee on matters referred to in this Section 2.3 shall be final, conclusive and binding upon all persons and shall, except as
expressly provided to the contrary in this Plan, be at the sole discretion of the Administrative Committee. The Administrative Committee shall have all powers necessary or appropriate to accomplish its duties under this Plan or to administer this
Plan. 

 ARTICLE 3. ELIGIBILITY AND GRANT 
  
 3.1 An individual shall be eligible to participate in this Plan provided that such individual is a non-employee
director of the Company (a “Director”) 
  
 3.2 A
Director of the Company may be granted a Right only by a written Stock Appreciation Rights Agreement signed by the Company and the Director granting to a Director a number of SARs in accordance with action taken by the Board of Directors, in form
and substance approved by the Administrative Committee, in accordance with Article 12 hereof. Each Director of the Company who so enters into a written Stock Appreciation Rights Agreement with the Company shall sometimes be referred to in this Plan
as a “Holder.” 
  
 ARTICLE 4. TERMS OF RIGHTS

  
 Each Right granted to a Holder in accordance with Section
3 shall have the following terms: 
  
 4.1 The Right shall
be granted effective as of the effective date of the Stock Appreciation Rights Agreement evidencing the grant of the Right; 
  
 4.2 The Right shall be associated with one share of Common Stock; 
  
 4.3 Unless it earlier terminates as provided in Section 9, the Right shall vest (if the Holder is still a Director at
such time) upon the public release of financial results by the Company for its fiscal year ending on February 29, 2008 (the “Normal Vesting Date”) or (if the Holder is still a Director at such time) upon the occurrence of an Accelerating
Event under Section 10.2, which shall accelerate vesting (the “Accelerated Vesting Date”) as provided in Section 10.2; 
  
 4.4 Each Right shall have a base value (the “Base Value”) equal to the average of the closing prices of one share of the Common Stock as
listed on the New York Stock Exchange for those days on which it trades during the ninety calendar days period immediately following the public release of financial results for the Company’s fiscal year ended February 28, 2005; and 

 
 4.5 Each Right shall be subject to such other terms and conditions
as the Administrative Committee deems advisable and as are consistent with the terms and conditions of this Plan. Except as expressly provided herein, nothing contained in this Plan shall require that the terms and conditions of Rights granted
hereunder be uniform. 
  
 ARTICLE 5. LIMITATIONS ON NUMBER OF
RIGHTS AND DATE OF GRANT 
  
 5.1 The aggregate number
of Rights that may be granted under this Plan shall be Twenty Seven Thousand Seven Hundred Twenty (27,720). This number shall be subject to any adjustment required or permitted pursuant to the provisions of Section 10. 
  
 5.2 No Rights may be granted under this Plan after May 18, 2005.

 ARTICLE 6. APPRECIATION AMOUNT 
  
 6.1 Effective as of the Normal Vesting Date or Accelerated Vesting Date of a Right, the Holder of the Right shall
have the full, unconditional and nonforfeitable ownership of the Right and shall be entitled to receive the amount by which the fair market value (the “FMV”) of one share of Common Stock as determined by the methods provided below exceeds
the Base Value of the Right (the “Appreciation Amount”). Prior to the occurrence of a Normal Vesting Date or Accelerated Vesting Date, a Right may be terminated or otherwise adjusted as allowed herein. 
  
 6.2 The FMV for the purpose of calculating the Appreciation Amount for
a Right that reaches maturity on the Normal Vesting Date, shall be the average of the closing prices of one share of the Common Stock on the New York Stock Exchange for those days on which it traded during the ninety calendar days period immediately
following the public release of financial results for the Company’s fiscal year ended February 29, 2008 (the “Normal Determination Period”). The FMV for the purpose of calculating the Appreciation Amount for a Right that reaches
maturity on an Accelerated Vesting Date shall be determined as set forth in Section 10.2 below (an “Accelerated Determination Period”). 
  
 ARTICLE 7. PAYMENT OF APPRECIATION AMOUNT 
  

	 	7.1   (a)	Within thirty (30) days following the expiration of the Normal Determination Period or, if applicable, an Accelerated Determination Period of a Right, the Company shall pay the
Appreciation Amount for each SAR which has vested (the Appreciation Amount times the number of Rights), without interest, to the Holder. 

  

	 	(b)	In no event shall payment occur after the expiration of two and one-half months after the end of the Holder’s taxable year in which the Normal Vesting Date or, if applicable,
the Accelerated Vesting Date occurs. The Normal Determination Period or, if applicable, the Accelerated Determination Period shall be shortened to the extent necessary to comply with the immediately preceding sentence. In such case, the
Administrative Committee shall determine the length of any shortened determination period, and its determination shall be binding on all parties. This Section 7.1(b) is intended to comply with the short-term deferral exception to the requirements of
section 409A of the Code and shall be construed and administered in a manner that qualifies for a good faith interpretation of such exception. 

  
 7.2 In the event of the death of a Holder of a Right, that has not been terminated, the right to receive any Appreciation Amounts due to the Holder
pursuant to this Plan may pass to the person or persons entitled thereto pursuant to the will of the Holder or, if no such will exists, pursuant to applicable laws of descent and distribution. 

 7.3 The Company shall be entitled to deduct from any payment required by this Plan (including any
Appreciation Amounts payable under Section 10.2) any amounts that the Company is required by applicable federal, state or local law to withhold therefrom on account of income or similar taxes. 
  
 ARTICLE 8. NATURE OF RIGHTS 
  
 8.1 The Rights are intended solely as a means to measure the
Appreciation Amounts that may become payable under this Plan. The Rights shall not constitute equity or other securities of the Company, and Holders of Rights shall not be shareholders of the Company and shall not have any right of access to
financial or other information regarding the Company. The Company shall not be required to set aside any amounts for purposes of this Plan, in trust or otherwise, in advance of the respective dates prescribed for the payment of Appreciation Amounts.
All Holders shall, except as otherwise provided by law, be general creditors of the Company with respect to the Rights and the right to payment of any Appreciation Amounts under this Plan. 
  
 8.2 Except as expressly allowed in Section 7.2 above or pursuant to a
qualified domestic relations order (within the meaning of Section 414(p) of the Code), no Holder shall have any right to sell, assign, pledge or otherwise transfer the Rights or any other rights that the Holder may have under this Plan, and any
attempt to do so shall be void. 
  
 ARTICLE 9. TERMINATION OF
RIGHTS 
  
 All of the Rights of a Holder shall terminate if
the Holder sells, assigns, pledges or otherwise transfers, or attempts to sell, assign, pledge or otherwise transfer, any Rights or any other rights that the Holder may have under this Plan; provided, however, that the foregoing shall not apply to a
transfer occurring upon the death of the Holder pursuant to the will of the Holder or applicable laws of descent and distribution or to a transfer or assignment pursuant to a qualified domestic relations order (within the meaning of Section 414(p)
of the Code). Additionally, all the rights of a Holder shall terminate if the Holder ceases to be a Director prior to the Normal Vesting Date or, if applicable, the Accelerated Vesting Date, unless such termination is due to death, Permanent
Disability or Removal. 
  
 ARTICLE 10. ADJUSTMENTS TO RIGHTS

  
 10.1 In the event that there is a material
alteration in the capital structure of the Company on account of a reorganization, merger, recapitalization, stock split, reverse stock split, stock dividend or otherwise in which the Company is the Surviving Entity, then the Administrative
Committee shall make such adjustments, if any, to the then outstanding Rights, including the Base Price, as the Administrative Committee determines to be appropriate and equitable under the circumstances. For purposes of this Section 10.1, neither
(a) the issuance of additional shares of Common Stock or other securities of the Company in exchange for consideration (including services) of any kind nor (b) the conversion into Common Stock of any securities of the Company now or hereafter
outstanding, shall be deemed material alterations in the capital structure of the Company. Notwithstanding the foregoing, however, in the event the Administrative Committee shall determine 

 
that the nature of a material alteration in the capital structure of the Company is such that it is not feasible or advisable to make adjustments to the
Rights, the Administrative Committee may declare a Restructuring Event to have occurred, in which case an Accelerated Vesting Date will be established as provided in Section 10.2(i). 
  
 10.2 In the event of (i) a Restructuring Event, (ii) the dissolution or liquidation of the Company, a merger or other
reorganization of the Company with one or more entities as a result of which the Company will not be the Surviving Entity, or a sale of all or substantially all of the assets of the Company, (iii) a Change in Control, (iv) a voluntary or involuntary
petition is filed for or against the estate of the Holder under the bankruptcy laws of the United States or under the insolvency laws of any state, and in the case of an involuntary petition, the petition is not dismissed within sixty (60) days
following the date of filing thereof, or (v) the termination as a Director of a Holder due to death, Permanent Disability (as defined below) or Retirement (as defined below), (each an “Accelerating Event”), an Accelerated Vesting Date
shall be established and a period (an “Accelerated Determination Period”) for the determination of the FMV shall be established as follows: 
  

					
	 Accelerating Event

	 	 Accelerated Vesting Date

	 	 Accelerated Determination Period and FMV

			
	(i) A Restructuring Event.	 	Date of such formal action as may be required to cause the material alteration in the Company’ s capital structure.	 	Closing Price of one share of Common Stock on the New York Stock Exchange on the last day before the Vesting Date on which shares of Common Stock traded shall be the FMV.
			
	(ii) Dissolution, liquidation, merger or other reorganization in which the Company is not the Surviving Entity.	 	Date of Filing of Articles of Dissolution or Articles of Merger or other documents formalizing a reorganization.	 	Closing Price of one share of Common Stock on the New York Stock Exchange on the last day before the Vesting Date on which shares of Common Stock traded shall be the FMV.
			
	(iii) Change in Control.	 	Public announcement of an event constituting a Change in Control.	 	The average of the closing prices of one share of the Common Stock on the New York Stock Exchange for those days on which it trades during the fifteen (15) calendar days immediately following
the Accelerated Vesting Date shall be the FMV.

					
	(iv) Bankruptcy	 	The date a voluntary petition is filed or sixty days following the date of filing of an involuntary petition, if not dismissed by that date.	 	The average of the closing prices of one share of the Common Stock on the New York Stock Exchange for those days on which it trades during the fifteen (15) calendar days immediately following
the Accelerated Vesting Date shall be the FMV.
			
	(v) Termination as a Director due to death, Permanent Disability, or Removal	 	The last day of the Holder’s service as a Director.	 	The average of the closing prices of one share of the Common Stock on the New York Stock Exchange for those days on which it trades during the fifteen (15) calendar days immediately following
the Accelerated Vesting Date shall be the FMV.

  
 ARTICLE 11.
TERMINATION AND AMENDMENT 
  
 The Board of Directors may at
any time terminate, suspend or amend the terms of this Plan; provided, however, that the termination, suspension or amendment of this Plan shall not, without the consent of the Holder, alter or impair any rights or obligations with respect to any
Rights theretofore granted hereunder. 
  
 ARTICLE 12. RIGHTS
AGREEMENT 
  
 Rights granted hereunder shall be evidenced by
a Stock Appreciation Rights Agreement designating the name of the Holder, the number of Rights granted to the Holder by the Board of Directors of the Company, the method of determining the Base Value and the Normal Vesting Date and an Accelerated
Vesting Date of the Rights, and such other terms, conditions and provisions not inconsistent with the terms and conditions of this Plan as the Administrative Committee deems advisable. 
  
 ARTICLE 13. MISCELLANEOUS PROVISIONS 
  
 13.1 Nothing contained in this Plan shall obligate the Company to continue a person as a Director for any period nor
shall this Plan interfere in any way with the right of the Company to reduce such Holder’s compensation. 
  
 13.2 Subject to Section 8, the provisions of this Plan shall inure to the benefit of and be binding upon each Holder and the heirs, successors and
assigns of each Holder. 

 13.3 Where the context so requires, references herein to the singular shall include the plural,
and vice versa, and references to a particular gender shall include either or both additional genders. 
  
 13.4 This Plan shall be construed, administered and enforced in accordance with the laws of the United States, to the extent applicable hereto, as
well as the laws of the State of Texas. 
  
 13.5 No action
taken under the Plan by the Administrative Committee shall be legally binding on a Holder if it is not taken in good faith. 
  
 ARTICLE 14. DEFINITIONS 
  
 14.1 As used herein, the following terms have the meaning hereinafter set forth unless the context clearly indicates to the contrary: 

 

	 	(a)	“Change in Control” means one or more of the following events: 

  

	 	(i)	Any person within the meaning of Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”) other than the Company (including its
affiliates, directors or executive officers) has become the beneficial owner, within the meaning of Rule 13d-3 under the Exchange Act, of 50 percent or more of the combined voting power of the Company’s then outstanding Common Stock and any
other class or classes of the Company’s outstanding securities ordinarily entitled to vote in elections of directors (collectively, “Voting Securities”) (other than through the purchase of Voting Securities from the Company); or

  

	 	(ii)	Shares representing 50 percent or more of the combined voting power of the Company’s Voting Securities are purchased pursuant to a tender offer or exchange offer (other than an
offer by the Company or its subsidiaries or affiliates); or 

  

	 	(iii)	During any two consecutive years, individuals who, at the beginning of such period constituted the entire Board of Directors, cease to constitute a majority of the Directors, unless
the election of each was approved by at least two-thirds of the Directors still in office who were Directors at the beginning of the period. 

  

	 	(b)	“Code” means the Internal Revenue Code of 1986, as amended. 

  

	 	(c)	“Permanent Disability” shall mean the inability for a period of at least six (6) consecutive months to carry out the duties and responsibilities of a Director.

	 	(d)	“Removal” means the termination of a person’s status as a Director (i) by shareholder vote, (ii) by the Company as a result of the person’s ineligibility for
service as a Director or (iii) otherwise by the Company unless such termination results from the person’s willful failure to perform his or her duties as a director or such person’s breach of fiduciary duties to the Company or its
shareholders. 

  

	 	(e)	“Subsidiary” of the Company means an entity directly or indirectly controlled by the Company. 

  

	 	(f)	“Surviving Entity” means an entity continuing after a merger, consolidation or other reorganization to which the Company is a party, more than fifty percent (50%) of the
outstanding voting securities of which are owned in the aggregate by persons who were shareholders of the Company prior to the merger, consolidation or reorganization. 

  
 Adopted by the Nominating and Corporate Governance Committee on May 18, 2005.Promissory Note of Allion Healthcare, dated as of March 31, 2005

 Exhibit 4.11 
  
 PROMISSORY NOTE 
  

															
	 Principal

	  	Loan Date

	  	Maturity

	  	Loan No

	  	Call / Coll

	  	Account

	  	Officer

	  	Initials

	 $1,500,000.00
	  	03-31-2005	  	09-30-2005	  	61299	  	 	  	0000119338	  	334	  	 

  
 References in the
shaded area are for Lender’s use only and do not limit the applicability of this document to any particular loan or item. Any item above containing “***” has been omitted due to text length limitations. 
  

							
	 Borrower:
	  	ALLION HEALTHCARE, INC. (TIN: 11-2962027)	  	Lender:	  	WEST BANK
	 	  	1660 WALT WHITMAN RD STE 105	  	 	  	MAIN BANK
	 	  	MELVILLE, NY 11747-4160	  	 	  	1601 22ND STREET
	 	  	 	  	 	  	WEST DES MOINES, IA 50266
	 	  	 	  	 	  	(515) 222-2300

  

											
	Principal Amount:	 	$1,500,000.00	 	Initial Rate:	 	7.750%	 	Date of Note:	 	March 31, 2005

  
 PROMISE TO PAY. ALLION HEALTHCARE,
INC. (“Borrower”) promises to pay to WEST BANK (“Lender”), or order, in lawful money of the United States of America, the principal amount of One Million Five Hundred Thousand & 00/100 Dollars ($1,500,000.00) or so much as
may be outstanding, together with interest on the unpaid outstanding principal balance of each advance. Interest shall be calculated from the date of each advance until repayment of each advance. 
  
 PAYMENT. Borrower will pay this loan in one payment of all outstanding principal plus all
accrued unpaid interest on September 30, 2005. In addition, Borrower will pay regular quarterly payments of all accrued unpaid interest due as of each payment date, beginning June 30, 2005, with all subsequent interest payments to be due on the same
day of each quarter after that. Unless otherwise agreed or required by applicable law, payments will be applied first to any accrued unpaid interest; then to principal; then to any unpaid collection costs; and then to any late charges. Interest on
this Note is computed on a 365/365 simple interest basis; that is, by applying the ratio of the annual interest rate over the number of days in a year, multiplied by the outstanding principal balance, multiplied by the actual number of days the
principal balance is outstanding. Borrower will pay Lender at Lender’s address shown above or at such other place as Lender may designate in writing. 
  

VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from time to time based on changes in an index which is Lender’s Prime Rate
(the “Index”). This is the rate Lender charges, or would charge, on 90-day unsecured loans to the most creditworthy corporate customers. This rate may or may not be the lowest rate available from Lender at any given time. Lender will tell
Borrower the current Index rate upon Borrower’s request. The interest rate change will not occur more often than each DAY. Borrower understands that Lender may make loans based on other rates as well. The Index currently is 5.750% per annum.
The interest rate to be applied to the unpaid principal balance of this Note will be at a rate of 2.000 percentage points over the Index, resulting in an initial rate of 7.750% per annum. NOTICE: Under no circumstances will the interest rate on this
Note be more than the maximum rate allowed by applicable law. 
  
 PREPAYMENT;
MINIMUM INTEREST CHARGE. In any event, even upon full prepayment of this Note, Borrower understands that Lender is entitled to a minimum interest charge of $7,50. Other than Borrower’s obligation to pay any minimum interest charge, Borrower
may pay without penalty all or a portion of the amount owed earlier than it is due. Early payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower’s obligation to continue to make payments of accrued unpaid
interest. Rather, early payments will reduce the principal balance due. Borrower agrees not to send Lender payments marked “paid in full”, “without recourse”, or similar language. If Borrower sends such a payment, Lender may
accept it without losing any of Lender’s rights under this Note, and Borrower will remain obligated to pay any further amount owed to Lender. All written communications concerning disputed amounts, including any check or other payment
instrument that indicates that the payment constitutes “payment in full” of the amount owed or that is tendered with other conditions or limitations or as full satisfaction of a disputed amount must be mailed or delivered to: WEST BANK,
MAIN BANK, 1601 22ND STREET, WEST DES MOINES, IA 50266. 
  
 LATE CHARGE. If
a payment is 11 days or more late, Borrower will be charged $15.00. 
  
 INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, Lender, at its option, may, if permitted under applicable law, increase the variable interest rate on this Note to 4.000 percentage points over the
Index. The interest rate will not exceed the maximum rate permitted by applicable law. 
  
 DEFAULT. Each of the following shall constitute an event of default (“Event of Default”) under this Note: 
  
 Payment Default. Borrower fails to make any payment when due under this Note. 
  
 Other Defaults. Borrower fails to comply with or to perform any other term, obligation, covenant or condition
contained in this Note or in any of the related documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between Lender and Borrower. 
  
 Default in Favor of Third Parties. Borrower or any Grantor defaults
under any loan, extension of credit, security agreement, purchase or sales agreement, or any other agreement, in favor of any other creditor or person that may materially affect any of Borrower’s property or Borrower’s ability to repay
this Note or perform Borrower’s obligations under this Note or any of the related documents. 
  
 False Statements. Any warranty, representation or statement made or furnished to Lender by Borrower or on Borrower’s behalf under this Note or
the related documents is false or misleading in any material respect, either now or at the time made or furnished or becomes false or misleading at any time thereafter. 
  
 Insolvency. The dissolution or termination of Borrower’s existence as a going business, the insolvency of
Borrower, the appointment of a receiver for any part of Borrower’s property, any assignment for the benefit of creditors, any type of creditor workout, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against
Borrower. 
  
 Creditor or Forfeiture Proceedings.
Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help, repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing the loan. This includes a
garnishment of any of Borrower’s accounts, including deposit accounts, with Lender. However, this Event of Default shall not apply if there is a good faith dispute by Borrower as to the validity or reasonableness of the claim which is the basis
of the creditor or forfeiture proceeding and if Borrower gives Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in an amount determined by
Lender, in its sole discretion, as being an adequate reserve or bond for the dispute. 
  
 Events Affecting Guarantor. Any of the preceding events occurs with respect to any guarantor, endorser, surety, or accommodation party of any of the indebtedness or any guarantor, endorser, surety, or
accommodation party dies or becomes incompetent, or revokes or disputes the validity of, or liability under, any guaranty of the indebtedness evidenced by this Note. In the event of a death, Lender, at its option, may, but shall not be required to,
permit the guarantor’s estate to assume unconditionally the obligations arising under the guaranty in a manner satisfactory to Lender, and, in doing so, cure any Event of Default. 
  
 Change In Ownership. Any change in ownership of twenty-five percent (25%) or more of the common stock of Borrower.

  
 Adverse Change. A material adverse change occurs in
Borrower’s financial condition, or Lender believes the prospect of payment or performance of this Note is impaired. 
  
 Insecurity. Lender in good faith believes itself insecure. 
  
 Cure Provisions. If any default, other than a default in payment is curable and if Borrower has not been given a
notice of a breach of the same provision of this Note within the preceding twelve (12) months, it may be cured if Borrower, after receiving written notice from Lender demanding cure of such default: (1) cures the default within twenty (20) days; or
(2) if the cure requires more than twenty (20) days, immediately initiates steps which Lender deems in Lender’s sole discretion to be sufficient to cure the default and thereafter continues and completes all reasonable and necessary steps
sufficient to produce compliance as soon as reasonably practical. 
  
 LENDER’S RIGHTS. Upon default, Lender may declare the entire unpaid principal balance on this Note and all accrued unpaid interest immediately due, and then Borrower will pay that amount. 
  
 ATTORNEYS’ FEES; EXPENSES. Lender may hire or pay someone else to help collect
this Note if Borrower does not pay. Borrower will pay Lender that amount. This includes, subject to any limits under applicable law, Lender’s attorneys’ fees and Lender’s legal expenses, whether or not there is a lawsuit, including
without limitation all attorneys’ fees and legal expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), and appeals. If not prohibited by applicable law, Borrower also will pay any court
costs, in addition to all other sums provided by law. 
  
 GOVERNING LAW. This
Note will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the State of Iowa without regard to its conflicts of law provisions. This Note has been accepted by Lender in the State of Iowa.

  
 CHOICE OF VENUE. If there is a lawsuit, Borrower agrees upon
Lender’s request to submit to the jurisdiction of the courts of POLK County, State of Iowa. 
  
 RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in all Borrower’s accounts with Lender (whether checking, savings, or some other account). This includes all
accounts Borrower holds jointly with someone else and all accounts Borrower may open in 
  

					
	Loan No: 61299	 	 PROMISSORY NOTE
 (Continued)
	 	Page 2

  
 the future. However, this does not
include any IRA or Keogh accounts, or any trust accounts for which setoff would be prohibited by law. Borrower authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing on the debt against any and all such
accounts, and, at Lender’s option, to administratively freeze all such accounts to allow Lender to protect Lender’s charge and setoff rights provided in this paragraph. 
  
 COLLATERAL. Borrower acknowledges this Note is secured by UNLIMITED GUARANTY OF JOHN PAPPAJOHN. 
  
 LINE OF CREDIT. This Note evidences a revolving line of credit. Advances under this
Note, as well as directions for payment from Borrower’s accounts, may be requested orally or in writing by Borrower or by an authorized person, Lender may, but need not, require that all oral requests be confirmed in writing. Borrower agrees to
be liable for all sums either: (A) advanced in accordance with the instructions of an authorized person or (B) credited to any of Borrower’s accounts with Lender. The unpaid principal balance owing on this Note at any time may be evidenced by
endorsements on this Note or by Lender’s internal records, including daily computer print-outs. Lender will have no obligation to advance funds under this Note if: (A) Borrower or any guarantor is in default under the terms of this Note or any
agreement that Borrower or any guarantor has with Lender, including any agreement made in connection with the signing of this Note; (B) Borrower or any guarantor ceases doing business or is insolvent; (C) any guarantor seeks, claims or otherwise
attempts to limit, modify or revoke such guarantor’s guarantee of this Note or any other loan with Lender; (D) Borrower has applied funds provided pursuant to this Note for purposes other than those authorized by Lender; or (E) Lender in good
faith believes itself insecure. 
  
 PURPOSE OF LOAN. The specific purpose
of this loan is: WORKING CAPITAL. 
  
 SUCCESSOR INTERESTS. The terms of
this Note shall be binding upon Borrower, and upon Borrower’s heirs, personal representatives, successors and assigns, and shall inure to the benefit of Lender and its successors and assigns. 
  
 GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or remedies
under this Note without losing them. Borrower and any other person who signs, guarantees or endorses this Note, to the extent allowed by law, waive presentment, demand for payment, and notice of dishonor. Upon any change in the terms of this Note,
and unless otherwise expressly stated in writing, no party who signs this Note, whether as maker, guarantor, accommodation maker or endorser, shall be released from liability. All such parties agree that Lender may renew or extend (repeatedly and
for any length of time) this loan or release any party or guarantor or collateral; or impair, fail to realize upon or perfect Lender’s security interest in the collateral; and take any other action deemed necessary by Lender without the consent
of or notice to anyone. All such parties also agree that Lender may modify this loan without the consent of or notice to anyone other than the party with whom the modification is made. The obligations under this Note are joint and several.

  
 PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS
OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF THE NOTE. 
  
 BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE AND ALL OTHER DOCUMENTS RELATING TO THIS DEBT. 
  

			
	BORROWER:
	
	ALLION HEALTHCARE INC.
		
	 By:
	 	 /s/ Mike Moran

	 	 	 MIKE MORAN,
 PRESIDENT of ALLION HEALTHCARE, INC.

  

 DISBURSEMENT REQUEST AND AUTHORIZATION 
  

															
	 Principal

	  	Loan Date

	  	Maturity

	  	Loan No

	  	Call / Coll

	  	Account

	  	Officer

	  	initials

	 $1,500,000.00
	  	03-51-2005	  	09-30-2005	  	61299	  	 	  	0000119338	  	334	  	 

  
 References in the
shaded area are for Lender’s use only and do not limit the applicability of this document to any particular loan or item. Any item above containing “***” has been omitted due to text length limitations. 
  

							
	 Borrower:
	  	ALLION HEALTHCARE, INC. (TIN: 11-2962027)	  	Lender:	  	WEST BANK
	 	  	1660 WALT WHITMAN RD STE 105	  	 	  	MAIN BANK
	 	  	MELVILLE, NY 11747-4160	  	 	  	1601 22ND STREET
	 	  	 	  	 	  	WEST DES MOINES, EA 50266
	 	  	 	  	 	  	(515) 222-2300

  
 LOAN TYPE. This is a Variable
Rate Nondisclosable Revolving Line of Credit Loan to a Corporation for $1,500,000.00 due on September 30, 2005. The reference rate (is the Lender’s base or reference rate, which the Lender may increase or decrease at any time in its discretion,
The rate is publicly available and may not necessarily reflect the rate that the Lender charges to its other customers. The rate is, currently 5.750%) is added to the margin of 2.000%, resulting in an initial rate of 7.750. This is an unsecured
renewal loan. 
  
 PRIMARY PURPOSE OF LOAN. The primary purpose of this loan
is for: 
  

	 	 ̈	Personal, Family, or Household Purposes or Personal Investment. 

  

	 	x	Business (Including Real Estate Investment). 

  
 SPECIFIC PURPOSE. The specific purpose of this loan is: WORKING CAPITAL. 
  

DISBURSEMENT INSTRUCTIONS. Borrower understands that no loan proceeds will be disbursed until all of Lender’s conditions for making the loan have been
satisfied. Please disburse the loan proceeds of $1,500,000.00 as follows: 
  

				
	 Other Disbursements:
	  	$	1,500,000.00
	 $1,500,000.00 TO BE DISBURSED UPON REQUEST
	  	 	 
	 	  	
	

	 Note Principal:
	  	$	1,500,000.00

  
 CHARGES PAID IN CASH. Borrower
has paid or will pay in cash as agreed the following charges: 
  

				
	 Prepaid Finance Charges Paid in Cash:
	  	$	0.00
	 Other Charges Paid in Cash:
$10,000.00 COMMITMENT FEE
	  	$	10,000.00
	 	  	
	

	 Total Charges Paid in Cash:
	  	$	10,000.00

  
 BORROWER ACKNOWLEDGES RECEIPT OF A
COMPLETED COPY OF THIS DISBURSEMENT REQUEST AND AUTHORIZATION AND ALL OTHER DOCUMENTS RELATING TO THIS DEBT. 
  
 FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND WARRANTS TO LENDER THAT THE INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN
BORROWER’S FINANCIAL CONDITION AS DISCLOSED IN BORROWER’S MOST RECENT FINANCIAL STATEMENT TO LENDER. THIS AUTHORIZATION IS DATED MARCH 31, 2005. 
  

			
	BORROWER:
	
	ALLION HEALTHCARE, INC.
		
	 By:
	 	 /s/ Mike Moran

	 	 	 MIKE MORAN,
 PRESIDENT of ALLION HEALTHCARE, INC.

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