Common use of Eligible Inventory Clause in Contracts

Eligible Inventory. Upon the delivery by Borrower to Lender of an Inventory Report, Lender shall determine, in its sole and absolute discretion, which items of Inventory listed thereon is Eligible Inventory. In making this determination, Lender will consider the following requirements: (a) The item of Inventory is in good condition, meets all standards imposed by any governmental agency, or department or division thereof, having regulatory authority over such goods, their use or sale, is not obsolete, is in good condition and is either currently useable or currently saleable in the ordinary course of Borrower's business and is not otherwise unacceptable to Lender due to age, type, category or quantity; (b) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance or security interest; (c) The item of Inventory has not been consigned, sold or leased to any Person; (d) Each of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in or as part of a "bulk" transfer or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales or bulk transfer laws; (f) The item of Inventory does not consist of work-in-process or packaging or supplies; (g) The item of Inventory is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory; (h) The item of Inventory is in the possession of Borrower but is not owned by Borrower; (i) The item of Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item of Inventory is not stored at a leased or warehouse location, unless in respect to such leased or warehouse location, Lender has received a landlord waiver or bailee letter in form and substance acceptable to Lender.

Eligible Inventory. Upon With respect to the delivery Borrower or any of its Subsidiaries, finished goods, work in progress and raw materials and component parts inventory owned by the Borrower to Lender of an or such Subsidiary; provided that Eligible Inventory Report, Lender shall determine, in its sole and absolute discretion, which items of Inventory listed thereon is Eligible Inventory. In making this determination, Lender will consider the following requirements: not include any inventory (ai) The item of Inventory is in good condition, meets all standards imposed by any governmental agencyheld on consignment, or department not otherwise owned by the Borrower or division thereofsuch Subsidiary, having regulatory authority over or of a type no longer sold by the Borrower or such goodsSubsidiary, their use or sale, is (ii) which has been returned by a customer and not obsolete, is in good condition and is either currently useable or currently saleable in the ordinary course of the Borrower's business and or is not otherwise unacceptable to Lender due to age, type, category damaged or quantity; (b) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any legal encumbrance other lienthan Permitted Liens, claim, encumbrance or security interest; (ciii) The item of Inventory has not been consigned, sold or leased to any Person; (d) Each of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in or as part of a "bulk" transfer or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales or bulk transfer laws; (f) The item of Inventory does not consist of work-in-process or packaging or supplies; (g) The item of Inventory which is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory; (h) The item of Inventory is in the possession of the Borrower but is not owned by Borrower; (i) The item of Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item of Inventory is not stored at a leased or warehouse location, Subsidiary unless in respect to such leased or warehouse location, Lender the Agent has received a landlord waiver or bailee letter from the party in possession of such inventory in form and substance acceptable satisfactory to Lenderthe Agent, (iv) which is held by the Borrower or such Subsidiary on property leased by the Borrower or a Subsidiary, unless the Agent has received a waiver from the lessor of such leased property and, if any, sublessor thereof in form and substance satisfactory to the Agent, (v) as to which appropriate Uniform Commercial Code financing statements showing the Borrower or such Subsidiary as debtor and the Agent as secured party have not been filed in the proper filing office or offices in order to perfect the Agent's security interest therein, (vi) which has been shipped to a customer of the Borrower or such Subsidiary regardless of whether such shipment is on a consignment basis, (vii) which is not located within the United States of America, or (viii) which the Majority Banks reasonably deem to be obsolete or not marketable. Employee Benefit Plan. Any employee benefit plan within the meaning of (S)3(3) of ERISA maintained of contributed to by the Borrower or any ERISA Affiliate, other than a Multiemployer Plan. Environmental Laws. 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 ("▇▇▇▇"), the Federal Clean Water Act, the Federal Clean Air Act, the Toxic Substances Control Act, or any applicable state or local statutes, regulation, ordinance, order or decree relating to the environment.

Eligible Inventory. Upon the delivery Inventory owned by a Borrower to Lender of an Inventory Report, Lender shall determinethat Lender, in its sole and absolute discretionPermitted Discretion, which items of Inventory listed thereon is deems to be Eligible Inventory. In making this determinationWithout limiting the foregoing, Lender will consider the following requirements: no Inventory shall be Eligible Inventory unless it (a) The item of Inventory is finished goods or raw materials and not work-in-process, packaging or shipping materials, labels, samples, display items, bags, replacement parts or manufacturing supplies; (b) is not held on consignment, nor subject to any deposit or down payment; (c) is in good conditionnew and saleable condition and is not damaged, defective, shopworn or otherwise unfit for sale; (d) is not slow-moving, perishable, obsolete or unmerchantable, and does not constitute returned or repossessed goods; (e) meets all standards imposed by any governmental agencyauthority, has not been acquired from an entity subject to any sanction or department or division thereofon any specially designated nationals list maintained by OFAC, having regulatory authority over such goodsand does not constitute hazardous materials under any environmental law; (f) conforms with the covenants and representations herein; (g) is subject to Lender’s duly perfected, their use or salefirst priority Lien, and no other Lien; (h) is within the continental United States, is not obsoletein transit except between locations of Borrowers, is in good condition and is either currently useable or currently saleable in the ordinary course of Borrower's business and is not otherwise unacceptable consigned to Lender due to age, type, category or quantity; any Person; (bi) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance warehouse receipt or security interest; negotiable Document; (cj) The item of Inventory has is not been consigned, sold or leased subject to any Person; (d) Each of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date License or other arrangement that the most recent Inventory Report was delivered restricts any Borrower’s or Lender’s right to Lender; (e) The item of Inventory was not purchased by Borrower in or as part of a "bulk" transfer or sale of assets unless Borrower, and the seller dispose of such itemInventory, have complied unless Lender has received an appropriate Lien Waiver; (k) is located (i) on a premises containing Eligible Inventory with all applicable bulk sales or bulk transfer laws; an aggregate Value of at least $50,000, (fii) The item of Inventory does not consist of work-in-process or packaging or supplies; (g) The item of if such Inventory is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory; (h) The item of Inventory is located on a leased premises or in the possession of Borrower but a warehouseman, processor, repairman, mechanic, shipper, freight forwarder or other Person, such lessor or such other Person has delivered a Lien Waiver or an appropriate Reserve has been established, provided, that, so long as Borrowers maintain Inventory with an aggregate Value of less than $60,000 at the Lambda Warehouse, no Lien Waiver shall be required for such location, or (iii) if such Inventory is not located on a premises owned by Borrower; (i) The item Borrowers and such premises is subject to a mortgage, the mortgagee of Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item of Inventory is not stored at premises has delivered a leased or warehouse location, unless in respect to such leased or warehouse location, Lender has received a landlord mortgagee waiver or bailee letter in form and substance acceptable satisfactory to Lender. Enforcement Action: any action to enforce any Obligations or Loan Documents or to realize upon any Collateral.

Eligible Inventory. Upon The following shall constitute the delivery by Borrower to Lender of an Inventory Report, Lender shall determine, in its sole and absolute discretion, which items Eligibility Criteria for acceptance of Inventory listed thereon is Eligible Inventory. In making this determinationfor inclusion in the Borrowing Base All Inventory of the Loan Parties, Lender will consider valued at the lower cost or market in accordance with GAAP, but excluding any Inventory having any of the following requirementscharacteristics: (a) The item Inventory that is in-transit; located at any warehouse, job site or located on any other premises that may be subject to the Lien of Inventory is in good condition, meets all standards imposed by any governmental agency, or department or division thereof, having regulatory authority over such goods, their use or sale, is not obsolete, is in good condition and is either currently useable or currently saleable in person other than the ordinary course of Borrower's business and is not otherwise unacceptable to Lender due to age, type, category or quantityCollateral Agent; (b) The item of Inventory that is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance or security interesta duly perfected first priority Lien in the Collateral Agent’s favor; (c) The item Inventory that is subject to (x) a Lien in favor of Inventory has not been consigned, sold any Person other than the Lender other than the ABDC Lien that is subject to the ABDC Intercreditor Agreement and (y) the Lien of a supplier or leased similar creditor of any of the Loan Parties that is subject to any Persona Supplier Intercreditor Agreement; (d) Each Inventory covered by any negotiable or non-negotiable warehouse receipt, ▇▇▇▇ of lading or other document of title; on consignment from any Person; on consignment to any Person or subject to any bailment unless such consignee or bailee has executed an agreement with the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in Supplies, packaging, parts or as part of a "bulk" transfer sample Inventory, or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales customer supplied parts or bulk transfer lawsInventory; (f) The item of Inventory does not consist of workWork-in-process or packaging or suppliesInventory; (g) The item of Inventory that is not damaged, defective, obsolete, slow moving Inventoryor not currently saleable in the normal course of the Borrower’s operations, is not out or the amount of date such Inventory and is not consigned Inventorythat has been reduced by shrinkage; (h) The item of Inventory that the Borrower has returned, has attempted to return, is in the possession process of Borrower but is not owned by Borrowerreturning or intends to return to the vendor thereof; (i) The item of Inventory does not consist of dock fees that is perishable or live or 30 days from expiration; (or "inside margin" as j) Inventory stored at locations outside the United States; (k) Inventory formulated by a Loan Party pursuant to a license unless the applicable licensor has agreed in writing to permit the Collateral Agent to exercise its rights and remedies against such term is used or referred to by Borrower)Inventory; and (jl) The item Inventory that is classified as controlled substances, C2 or other controlled substances or pharmaceuticals unless the applicable Loan Party (i) possesses a specialized license from the U.S. Drug Enforcement Agency or other federal, state or local authority to sell or dispose of Inventory same, or (ii) is not stored at otherwise prohibited under applicable law from selling or otherwise disposing of same. Reference is made to the credit agreement, dated as of March 25, 2010 (as amended, restated, supplemented, waived or otherwise modified from time to time, the “Credit Agreement”), among BioScrip, Inc., a leased Delaware corporation (“Borrower”), the Subsidiary Guarantors, the Lenders, Jefferies Finance LLC, as administrative agent (in such capacity, the “Administrative Agent”), as lead arranger, as book manager and as collateral agent for the Secured Parties, ING Capital LLC, as syndication agent, Compass Bank, as a co-documentation agent, General Electric Capital Corporation, a co-documentation agent, HFG Healthco-4, LLC, as swingline lender for the Lenders, and Healthcare Finance Group, LLC, collateral manager and as issuing bank for the Lenders. Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement. 1. (the “Assignor”) hereby irrevocably sells and assigns, without recourse, to the Assignee, and the Assignee hereby irrevocably purchases and assumes, from the Assignor, without recourse to the Assignor, effective as of the Effective Date set forth below (but not prior to the registration of the information contained herein in the Register pursuant to Section 11.04(c) of the Credit Agreement), the interests set forth below (the “Assigned Interest”) in the Assignor’s rights and obligations under the Credit Agreement and the other Loan Documents, including, without limitation, the Swingline Commitment, Revolving Commitment, Term Loan Commitment and the Swingline Loans, Revolving Loans, Term Loans and participations held by the Assignor in Letters of Credit which are outstanding on the Effective Date. From and after the Effective Date (i) the Assignee shall be a party to and be bound by the provisions of the Credit Agreement and, to the extent of the interests assigned by this Assignment and Acceptance, have the rights and obligations of a Lender thereunder and under the Loan Documents and (ii) the Assignor shall, to the extent of the interests assigned by this Assignment and Acceptance, relinquish its rights and be released from its obligations under the Credit Agreement. 2. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the interest being assigned hereby free and clear of any lien, encumbrance or warehouse locationother adverse claim created by the Assignor and that its Commitments, unless and the outstanding balances of its Loans, without giving effect to assignments thereof which have not become effective, are as set forth in this Assignment and Acceptance and (ii) it has all necessary power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby; and (b) except as set forth in (a) above, the Assignor makes no representation or warranty and assumes no responsibility with respect to such leased any statements, warranties or warehouse locationrepresentations made in or in connection with the Credit Agreement, or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement, any other Loan Document or any other instrument or document furnished pursuant thereto, or the financial condition of any Loan Party or the performance or observance by any Loan Party of any of its obligations under the Credit Agreement, any other Loan Document or any other instrument or document furnished pursuant thereto. 3. The Assignee (a) represents and warrants that (i) it is legally authorized to enter into this Assignment and Acceptance and (ii) it has all necessary power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby and become a Lender under the Credit Agreement; (b) confirms that it has received a landlord waiver copy of the Credit Agreement, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance; (c) agrees that it will, independently and without reliance upon the Assignor, the Agents or bailee letter any Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in form taking or not taking action under the Credit Agreement, the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto; (d) appoints and substance acceptable authorizes the Agents to take such action as agents on its behalf and to exercise such powers and discretion under the Credit Agreement, the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto as are delegated to the Agents by the terms thereof, together with such powers as are incidental thereto; and (e) agrees that it will be bound by the provisions of the Credit Agreement and will perform in accordance with its terms all the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender. 4. The effective date of this Assignment and Acceptance shall be the Effective Date of Assignment described in Schedule 1 hereto (the “Effective Date”). Following the execution of this Assignment and Acceptance, it will be delivered to the Administrative Agent for acceptance by it and recording by the Administrative Agent pursuant to the Credit Agreement, effective as of the Effective Date (which shall not, unless otherwise agreed to by the Administrative Agent, in its sole discretion, be earlier than three Business Days after the date of such acceptance and recording by the Administrative Agent). This Assignment and Acceptance will be delivered to the Administrative Agent together with (a) if the Assignee is a Foreign Lender, the forms specified in Section 2.15(e) of the Credit Agreement, duly completed and executed by such Assignee; (b) if the Assignee is not already a Lender under the Credit Agreement, an Administrative Questionnaire, and (c) a processing and recordation fee of $3,500, if required under the Loan Documents. 5. Upon such acceptance and recording, from and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) [to the Assignor for amounts which have accrued to the Effective Date and to the Assignee for amounts which have accrued subsequent to the Effective Date] [to the Assignee whether such amounts have accrued prior to the Effective Date or accrue subsequent to the Effective Date. The Assignor and the Assignee shall make all appropriate adjustments in payments by the Administrative Agent for periods prior to the Effective Date or with respect to the making of this assignment directly between themselves.] 6. From and after the Effective Date, (a) the Assignee shall be a party to the Credit Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations of a lender thereunder and under the other Loan Documents and shall be bound by the provisions thereof and (b) the Assignor shall, to the extent provided in this Assignment and Acceptance, relinquish its rights and be released from its obligations under the Credit Agreement. 7. This Assignment and Acceptance shall be construed in accordance with and governed by the law of the State of New York without regard to conflicts of law principles that would require the application of the laws of another jurisdiction. Effective Date of Assignment: Legal Name of Assignor: Legal Name of Assignee: Assignee’s Address for Notices: Percentage Assigned of Applicable Loan/Commitment: Loan/Commitment Principal Amount Assigned all Lenders thereunder) Term Loans $ % Revolving Loans $ % Letters of Credit $ % Swingline Loans $ % [Signature Page Follows] The terms set forth above are hereby agreed to: [ ] as Assignor By: Name: Title: as Assignee By: Name: Title: Accepted:* BIOSCRIP, INC. By: Name: Title: JEFFERIES FINANCE LLC, as Administrative Agent By: Name: Title: [ ], as [Swingline Lender/Issuing Bank]** By: Name: Title: * To be completed to the extent consent of Borrower and/or Administrative Agent is required under Section 11.04(b) of the Credit Agreement. ** To be completed to the extent consent of the Swingline Lender or Issuing Bank is required under Section 11.04(b) of the Credit Agreement. Jefferies Finance LLC, as Administrative Agent for the Lenders referred to below ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Attention: Account Manager — BioScrip Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Re: BioScrip, Inc. [Date] Ladies and Gentlemen: Reference is made to the credit agreement, dated as of March 25, 2010 (as amended, restated, supplemented, waived or otherwise modified from time to time, the “Credit Agreement”), among BioScrip, Inc., a Delaware corporation (“Borrower”), the Subsidiary Guarantors, the Lenders, Jefferies Finance LLC, as administrative agent, as lead arranger, as book manager and as collateral agent for the Secured Parties, ING Capital LLC, as syndication agent, Compass Bank, as a co-documentation agent, General Electric Capital Corporation, a co-documentation agent, HFG Healthco-4, LLC, as swingline lender for the Lenders, and Healthcare Finance Group, LLC, as collateral manager and as issuing bank for the Lenders. Capitalized terms used but not defined herein shall have the meaning assigned to such terms in the Credit Agreement. Borrower hereby gives you notice pursuant to Section 2.03 of the Credit Agreement that it requests a Borrowing under the Credit Agreement, and that in connection therewith sets forth below the terms on which such Borrowing is requested to be made: (A) Class of Borrowing: [Revolving Borrowing] [Term Borrowing] (B) Principal amount of Borrowing:1 (C) Date of Borrowing (which is a Business Day): (D) Type of Borrowing: [ABR Borrowing] [Eurodollar Borrowing] (E) Interest Period and the last day thereof:2 (F) Funds are requested to be disbursed to Borrower’s account with: Account No. Borrower hereby represents and warrants that the conditions to lending specified in Sections 4.02(b)-(d) of the Credit Agreement are satisfied as of the date hereof. 1 See Section 2.02(a) of the Credit Agreement for minimum borrowing amounts.

Eligible Inventory. Upon With respect to the delivery Borrower, finished goods inventory owned by Borrower to Lender of an the Borrower; PROVIDED that Eligible Inventory Report, Lender shall determine, in its sole and absolute discretion, which items of Inventory listed thereon is Eligible Inventory. In making this determination, Lender will consider the following requirements: not include any inventory (a) The item of Inventory is in good condition, meets all standards imposed by any governmental agencyheld on consignment, or department or division thereof, having regulatory authority over such goods, their use or sale, is not obsolete, is in good condition and is either currently useable or currently saleable in the ordinary course of Borrower's business and is not otherwise unacceptable to Lender due to ageowned by the Borrower, type, category or quantity; (b) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, which is subject to and covered by Lender's perfected security interest and any legal encumbrance other than Permitted Liens, (c) which is not in the possession of the Borrower unless (i) the Agent has received a waiver from the party in possession of such inventory in form and substance reasonably satisfactory to the Agent or (ii) such inventory is in transit from one Permitted Inventory Location to another Permitted Inventory Location, and the total duration of such transit time is not more than two (2) Business Days, (d) which is subject to any other lien, claim, encumbrance or security interest; interest which is prior to the liens granted to the Agent (c) The item of Inventory other than landlord's or lessor's liens under leases to which the Borrower is a party provided no amount secured by such lien has become due and payable and not been consignedpaid), sold or leased to any Person; (d) Each of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; (e) The item as to which appropriate Uniform Commercial Code financing statements showing the Borrower as debtor and the Agent as secured party have not been filed in the proper filing office or offices in order to perfect the Agent's security interest therein, (f) which has been shipped to a customer of the Borrower regardless of whether such shipment is on a consignment basis, (g) which is not located at a Permitted Inventory was not purchased by Borrower Location unless such inventory is in or as part of a "bulk" transfer or sale of assets unless Borrowertransit from one Permitted Inventory Location to another Permitted Inventory Location, and the seller total duration of such item, have complied with all applicable bulk sales or bulk transfer laws; (f) The item of Inventory does not consist of work-in-process or packaging or supplies; (g) The item of Inventory transit time is not slow moving Inventorymore than two (2) Business Days, is not out of date Inventory and is not consigned Inventory; (h) The item which the Borrower reasonably deems to be obsolete or not marketable consistent with its past practices, PROVIDED that such practices shall be subject to the review and approval of Inventory is in the possession Agent after the occurrence and during the continuance of Borrower but is not owned by Borrower; an Event of Default, (i) The item which is Packaway Inventory to the extent such inventory exceeds ten percent (10%) of Eligible Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item which has been owned by the Borrower for more than one (1) year (except to the extent permitted in clause (i) of Inventory is not stored at a leased or warehouse location, unless in respect to such leased or warehouse location, Lender has received a landlord waiver or bailee letter in form and substance acceptable to Lenderthis definition).

Eligible Inventory. Upon The following shall constitute the delivery by Borrower to Lender of an Inventory Report, Lender shall determine, in its sole and absolute discretion, which items Eligibility Criteria for acceptance of Inventory listed thereon is Eligible Inventoryfor inclusion in the Borrowing Base. In making this determinationAll Inventory of the Loan Parties, Lender will consider valued at the lower cost or market in accordance with GAAP, but excluding any Inventory having any of the following requirementscharacteristics: (a) The item Inventory that is in-transit; located at any warehouse, job site or located on any other premises that may be subject to the Lien of Inventory is in good condition, meets all standards imposed by any governmental agency, or department or division thereof, having regulatory authority over such goods, their use or sale, is not obsolete, is in good condition and is either currently useable or currently saleable in person other than the ordinary course of Borrower's business and is not otherwise unacceptable to Lender due to age, type, category or quantityCollateral Agent; (b) The item of Inventory that is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance or security interesta duly perfected first priority Lien in the Collateral Agent’s favor; (c) The item Inventory that is subject to (x) a Lien in favor of Inventory has not been consigned, sold any Person other than the Lender other than the ABDC Lien that is subject to the ABDC Intercreditor Agreement and (y) the Lien of a supplier or leased similar creditor of any of the Loan Parties that is subject to any Persona Supplier Intercreditor Agreement; (d) Each Inventory covered by any negotiable or non-negotiable warehouse receipt, ▇▇▇▇ of lading or other document of title; on consignment from any Person; on consignment to any Person or subject to any bailment unless such consignee or bailee has executed an agreement with the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in Supplies, packaging, parts or as part of a "bulk" transfer sample Inventory, or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales customer supplied parts or bulk transfer lawsInventory; (f) The item of Inventory does not consist of workWork-in-process or packaging or suppliesInventory; (g) The item of Inventory that is not damaged, defective, obsolete, slow moving Inventoryor not currently saleable in the normal course of Borrower’s operations, is not out or the amount of date such Inventory and is not consigned Inventorythat has been reduced by shrinkage; (h) The item of Inventory that the Borrower has returned, has attempted to return, is in the possession process of Borrower but is not owned by Borrowerreturning or intends to return to the vendor thereof; (i) The item of Inventory does not consist of dock fees that is perishable or live or 30 days from expiration; (or "inside margin" as j) Inventory stored at locations outside the United States; (k) Inventory formulated by a Loan Party pursuant to a license unless the applicable licensor has agreed in writing to permit the Collateral Agent to exercise its rights and remedies against such term is used or referred to by Borrower)Inventory; and (jl) The item Inventory that is classified as controlled substances, C2 or other controlled substances or pharmaceuticals unless the applicable Loan Party (i) possesses a specialized license from the U.S. Drug Enforcement Agency or other federal, state or local authority to sell or dispose of Inventory same, or (ii) is not stored at otherwise prohibited under applicable law from selling or otherwise disposing of same. None. Reference is made to the Amended and Restated Credit Agreement, dated as of December 28, 2010 (as amended, restated, supplemented, waived or otherwise modified from time to time, the “Credit Agreement”), among BioScrip, Inc., a leased Delaware corporation (“Borrower”), the Subsidiary Guarantors, the Lenders, Healthcare Finance Group, LLC, as administrative agent (in such capacity, the “Administrative Agent”), as collateral agent for the Secured Parties and as collateral manager, and other entities party thereto. Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement. 1. (the “Assignor”) hereby irrevocably sells and assigns, without recourse, to _________________ (the “Assignee”), and the Assignee hereby irrevocably purchases and assumes, from the Assignor, without recourse to the Assignor, effective as of the Effective Date set forth below (but not prior to the registration of the information contained herein in the Register pursuant to Section 11.04(c) of the Credit Agreement), the interests set forth below (the “Assigned Interest”) in the Assignor’s rights and obligations under the Credit Agreement and the other Loan Documents, including, without limitation, the Swingline Commitment, Revolving Commitment and the Swingline Loans, Revolving Loans and participations held by the Assignor in Letters of Credit which are outstanding on the Effective Date. From and after the Effective Date (i) the Assignee shall be a party to and be bound by the provisions of the Credit Agreement and, to the extent of the interests assigned by this Assignment and Acceptance, have the rights and obligations of a Lender thereunder and under the Loan Documents and (ii) the Assignor shall, to the extent of the interests assigned by this Assignment and Acceptance, relinquish its rights and be released from its obligations under the Credit Agreement. 2. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the interest being assigned hereby free and clear of any lien, encumbrance or warehouse locationother adverse claim created by the Assignor and that its Commitments, unless and the outstanding balances of its Loans, without giving effect to assignments thereof which have not become effective, are as set forth in this Assignment and Acceptance and (ii) it has all necessary power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby; and (b) except as set forth in (a) above, the Assignor makes no representation or warranty and assumes no responsibility with respect to such leased any statements, warranties or warehouse locationrepresentations made in or in connection with the Credit Agreement, or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement, any other Loan Document or any other instrument or document furnished pursuant thereto, or the financial condition of any Loan Party or the performance or observance by any Loan Party of any of its obligations under the Credit Agreement, any other Loan Document or any other instrument or document furnished pursuant thereto. 3. The Assignee (a) represents and warrants that (i) it is legally authorized to enter into this Assignment and Acceptance and (ii) it has all necessary power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby and become a Lender under the Credit Agreement; (b) confirms that it has received a landlord waiver copy of the Credit Agreement, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance; (c) agrees that it will, independently and without reliance upon the Assignor, the Agents or bailee letter any Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in form taking or not taking action under the Credit Agreement, the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto; (d) appoints and substance acceptable authorizes the Agents to take such action as agents on its behalf and to exercise such powers and discretion under the Credit Agreement, the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto as are delegated to the Agents by the terms thereof, together with such powers as are incidental thereto; and (e) agrees that it will be bound by the provisions of the Credit Agreement and will perform in accordance with its terms all the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender. 4. The effective date of this Assignment and Acceptance shall be the Effective Date of Assignment described in Schedule 1 hereto (the “Effective Date”). Following the execution of this Assignment and Acceptance, it will be delivered to the Administrative Agent for acceptance by it and recording by the Administrative Agent pursuant to the Credit Agreement, effective as of the Effective Date (which shall not, unless otherwise agreed to by the Administrative Agent, in its sole discretion, be earlier than three Business Days after the date of such acceptance and recording by the Administrative Agent). This Assignment and Acceptance will be delivered to the Administrative Agent together with (a) if the Assignee is a Foreign Lender, the forms specified in Section 2.15(e) of the Credit Agreement, duly completed and executed by such Assignee; (b) if the Assignee is not already a Lender under the Credit Agreement, an Administrative Questionnaire, and (c) a processing and recordation fee of $3,500, if required under the Credit Agreement. 5. Upon such acceptance and recording, from and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) [to the Assignor for amounts which have accrued to the Effective Date and to the Assignee for amounts which have accrued subsequent to the Effective Date] [to the Assignee whether such amounts have accrued prior to the Effective Date or accrue subsequent to the Effective Date. The Assignor and the Assignee shall make all appropriate adjustments in payments by the Administrative Agent for periods prior to the Effective Date or with respect to the making of this assignment directly between themselves.] 6. From and after the Effective Date, (a) the Assignee shall be a party to the Credit Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations of a lender thereunder and under the other Loan Documents and shall be bound by the provisions thereof and (b) the Assignor shall, to the extent provided in this Assignment and Acceptance, relinquish its rights (except those surviving the payment in full of the Obligations) and be released from its obligations under the Loan Documents. 7. This Assignment and Acceptance shall be construed in accordance with and governed by the law of the State of New York without regard to conflicts of law principles that would require the application of the laws of another jurisdiction. Effective Date of Assignment: Legal Name of Assignor: Legal Name of Assignee: Assignee’s Address for Notices: Percentage Assigned of Applicable Loan/Commitment: Loan/Commitment Principal Amount Assigned all Lenders thereunder) Revolving Loans $ % Letters of Credit $ % Swingline Loans $ % [Signature Page Follows] The terms set forth above are hereby agreed to: [ as Assignor ] By: Name: Title: as Assignee By: Name: Title: Accepted:* BIOSCRIP, INC., as Borrower By: Name: Title: HEALTHCARE FINANCE GROUP, LLC, as Administrative Agent By: Name: Title: [______________], as [Swingline Lender/Issuing Bank]** * To be completed to the extent consent of Borrower and/or Administrative Agent is required under Section 11.04(b) of the Credit Agreement. ** To be completed to the extent consent of the Swingline Lender or Issuing Bank is required under Section 11.04(b) of the Credit Agreement. By: Name: Title: Healthcare Finance Group, LLC, as Administrative Agent for the Lenders referred to below ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Attention: [Bioscrip Account Manager] Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Re: BioScrip, Inc. [Date] Ladies and Gentlemen: Reference is made to the Amended and Restated Credit Agreement, dated as of December 28, 2010 (as amended, restated, supplemented, waived or otherwise modified from time to time, the “Credit Agreement”), among BioScrip, Inc., a Delaware corporation (“Borrower”), the Subsidiary Guarantors, the Lenders, Healthcare Finance Group, LLC, as administrative agent, as collateral agent for the Secured Parties and as collateral manager, and other entities party thereto. Capitalized terms used but not defined herein shall have the meaning assigned to such terms in the Credit Agreement. Borrower hereby gives you notice pursuant to Section 2.03 of the Credit Agreement that it requests a Revolving Borrowing under the Credit Agreement, and that in connection therewith sets forth below the terms on which such Revolving Borrowing is requested to be made: (A) Principal amount of Borrowing:1 (B) Date of Borrowing (which is a Business Day): (C) Funds are requested to be disbursed to Borrower’s account with: Account No. Borrower hereby represents and warrants that the conditions to lending specified in Sections 4.02(b)-(d) of the Credit Agreement are satisfied as of the date hereof. 1 See Section 2.02(a) of the Credit Agreement for minimum borrowing amounts. By: Name: Title: BIOSCRIP, INC. BORROWING BASE at 1/31/2010 Manual AR Rebate Receivable Ineligible AR Offset — Shared Rebate Portion Cash Basis account for PBM Estimated Net Value Factor 95 % 95 % 95 % 90 % 92 % 92 % 95 % 95 % 99 % 0 % 94 % Estimated Net Value Credit Balances Month-end Cash intransit 0 Adjusted Net Value of Receivable Advance Rate A/R 85 % 85 % 85 % 85 % 85 % 85 % 85 % 85 % 85 % 0 % 85 % Inventory Availability per Appendix 1 0 Interim CHS availability Borrowing Base $ 0 Revolving Commitment $ 150,000,000 Borrowing Limit $ 0 Other Reserves Loan Activity $ 0 Revolving Advances Since Prior Report — Less Collections — Deposits — Total Interest, Fees, Charges & Expenses — Deposits in Transit — Revolving Loan Balance This Report Net Availability $ 0 The undersigned represents and warrants that the foregoing information is true, complete and correct and that the collateral reflected herein complies with and conforms to the Eligibility Criteria set forth in Annex IV to the Amended and Restated Credit Agreement dated as of December 28, 2010 by and among Bioscrip, Inc., the subsidiaries of Bioscrip, Inc., Healthcare Finance Group, LLC, as Administrative Agent, Collateral Agent and Collateral Manager, and other entities party thereto (as amended, restated, supplemented or otherwise modified from time to time, the “Agreement”). BioScrip, Inc. promises to pay to Healthcare Finance Group, LLC, as Collateral Manager, the new loan balances reflected above, plus interest, as set forth in the Agreement. By: Date: _______________ Name: Title: I. Inventory per perpetual report $ —

Eligible Inventory. Upon the delivery Inventory owned by a Borrower to Lender of an Inventory Report, Lender shall determine, in its sole and absolute discretion, which items of Inventory listed thereon is Eligible Inventory. In making this determination, Lender will consider the following requirements: that (a) The item is finished goods or raw materials, and not packaging or shipping materials, labels, samples, display items, bags, replacement parts or manufacturing supplies; (b) is not held on consignment, nor subject to any deposit or down payment (but ineligibility shall be limited to the amount of Inventory such deposit or down payment); (c) is in good conditionnew and saleable condition and is not damaged, defective, shopworn or otherwise unfit for sale; (d) is not slow-moving, perishable, obsolete or unmerchantable, and does not constitute returned or repossessed goods; (e) meets all standards imposed by any governmental agencyGovernmental Authority, and does not constitute hazardous materials under any Environmental Law; (f) conforms with the covenants and representations herein; (g) is subject to Agent’s duly perfected, first priority Lien, and no other Lien; (h) is located within the continental United States or department or division thereofCanada, having regulatory authority over such goods, their use or salesubject to the mutual agreement of Agent and Borrower Agent, is not obsolete, is in good condition and is either currently useable or currently saleable in the ordinary course of Borrower's business consigned to any Person and is not otherwise unacceptable to Lender due to agein transit, type, category or quantity; (b) The item of other than Inventory is located at one of the in transit between domestic locations of any Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to which Agent’s Liens have been perfected at origin and covered by Lender's perfected security interest and destination; (i) is not subject to any other lien, claim, encumbrance warehouse receipt or security interest; negotiable Document; (cj) The item of Inventory has is not been consigned, sold or leased subject to any License or other arrangement that restricts such Borrower’s or Agent’s right to dispose of such Inventory, unless Agent has received an appropriate Lien Waiver; (k) is not located on leased premises or in the possession of a warehouseman, processor, repairman, mechanic, shipper, freight forwarder or other Person; (d) Each of , unless the warranties lessor or such Person has delivered a Lien Waiver or an appropriate Rent and representations set forth in Section 9.3 Charges Reserve has been reaffirmed with respect established; (l) is not subject to a third party’s trademark or other proprietary right, unless Agent is satisfied that it could sell such item of Inventory at during a Default on terms satisfactory to Agent; (m) is reflected in the date that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in or as part details of a "bulk" transfer or sale of assets unless Borrowercurrent perpetual inventory report; (n) is not subject to any unfavorable capitalized variances; (o) is not identified within the “physical inventory reserve” in the Borrowers’ Financial Statements; (p) is not subject to intercompany profits from intercompany sales; (q) is not subject to vendor rebate accruals but, and if so, such Inventory, if otherwise Eligible Inventory, shall only be excluded to the seller extent of such itemrebate accruals; and (r) is not otherwise deemed ineligible by Agent in its Permitted Discretion; provided, have complied that, before determining any Inventory ineligible pursuant to clause (r), Agent shall provide Borrower Agent with all applicable bulk sales or bulk transfer laws; (f) The item prior notice accompanied by a statement setting forth the basis for Agent’s good faith determination made with reasonable business judgment of such ineligible. Eligible Work-In-Process Inventory: Inventory does not consist that would be Eligible Inventory except that such Inventory consists of work-in-process or packaging or supplies; (g) The item of process. Borrowers acknowledge that no Inventory is not slow moving Inventoryshall constitute Eligible Work‑In‑Process Inventory until Agent receives the March 31, is not out of date 2017 Inventory and is not consigned Inventory; (h) The item of Inventory is in the possession of Borrower but is not owned by Borrower; (i) The item of Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item of Inventory is not stored at a leased or warehouse location, unless in respect to such leased or warehouse location, Lender has received a landlord waiver or bailee letter in form and substance acceptable to Lenderappraisal.

Eligible Inventory. Upon With respect to the delivery Borrower and AEL, finished goods and piece goods owned by the Borrower or, ONLY with respect to Lender finished goods and piece goods inventory located in Hong Kong, AEL or the Borrower if the Borrower has taken all steps requested by the Facility Agent to grant to the Facility Agent, for the benefit of an Inventory Reportthe Agents and the Lenders, Lender a first-priority perfected charge over the assets of the Borrower located in Hong Kong, pursuant to such documentation (including, without limitation, a debenture, corporate authority documentation, and one or more legal opinion(s)) as shall determinebe satisfactory, in its sole form and absolute discretionsubstance, which items of to the Facility Agent; PROVIDED that Eligible Inventory listed thereon is Eligible Inventory. In making this determination, Lender will consider the following requirements: shall not include any inventory (a) The item of Inventory is in good condition, meets all standards imposed by any governmental agencyheld on consignment, or department not otherwise owned by the Borrower or division thereofAEL or of a type no longer sold by the Borrower, having regulatory authority over (b) which has been returned by a customer or is damaged or subject to any legal encumbrance other than Permitted Liens, (c) which (i) if such goods, their use or salegoods are located in the United States, is not obsolete, is in good condition and is either currently useable or currently saleable in the ordinary course of Borrower's business and is not otherwise unacceptable to Lender due to age, type, category or quantity; (b) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance or security interest; (c) The item of Inventory has not been consigned, sold or leased to any Person; (d) Each of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in or as part of a "bulk" transfer or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales or bulk transfer laws; (f) The item of Inventory does not consist of work-in-process or packaging or supplies; (g) The item of Inventory is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory; (h) The item of Inventory is in the possession of the Borrower but is not owned by Borrower; (i) The item or any of Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item of Inventory is not stored at a leased or warehouse location, its Subsidiaries unless in respect to such leased or warehouse location, Lender the Facility Agent has received a landlord waiver or bailee letter from the party in possession of such inventory in form and substance reasonably satisfactory to the Facility Agent or (ii) if such goods are in transit, with respect to which all documents of title relating to such Inventory have not been consigned to the Facility Agent in a manner reasonably acceptable to Lenderthe Facility Agent and the Facility Agent or an Approved Customs Broker is not in possession of all documents of title relating to such goods, (d) which is held by the Borrower or any of its Subsidiaries on property leased by the Borrower or any of its Subsidiaries, unless the Facility Agent has received a waiver from the lessor of such leased property and, if any, sublessor thereof in form and substance reasonably satisfactory to the Facility Agent, (e) as to which the security interest of the Facility Agent has not been duly perfected under applicable local law, (f) which has been shipped to a customer of the Borrower or any of its Subsidiaries regardless of whether such shipment is on a consignment basis, (g) which the Facility Agent reasonably deems to be obsolete or not marketable or otherwise does not consider "Eligible Inventory", (h) which is reasonably deemed by the Facility Agent, based upon reasonable credit, commercial, accounting or other considerations, to be unacceptable for inclusion in Eligible Inventory, or (i) which is owned by the Borrower and located in Hong Kong unless the Borrower has taken all steps requested by the Facility Agent to grant to the Facility Agent, for the benefit of the Agents and the Lenders, a first-priority perfected charge over the assets of the Borrower located in Hong Kong, pursuant to such documentation (including, without limitation, a debenture, corporate authority documentation, and one or more legal opinion(s)) as shall be satisfactory, in form and substance, to the Facility Agent.

Eligible Inventory. Upon With respect to the delivery Borrower or any of its ------------------ Subsidiaries, finished goods and work in progress and raw materials owned by the Borrower to Lender of an or such Subsidiary; provided that Eligible Inventory Report, Lender shall determine, in its sole and absolute discretion, which items of Inventory listed thereon is Eligible Inventory. In making this determination, Lender will consider the following requirements: not include -------- any inventory (ai) The item of Inventory is in good condition, meets all standards imposed by any governmental agencyheld on consignment, or department not otherwise owned by the Borrower or division thereofsuch Subsidiary, having regulatory authority over or of a type no longer sold by the Borrower or such goodsSubsidiary, their use or sale, is not obsolete, is in good condition (ii) which has been returned by a customer and is either currently useable damaged or currently saleable in the ordinary course of Borrower's business and is not otherwise unacceptable to Lender due to age, type, category or quantity; (b) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any legal encumbrance other lienthan Permitted Liens, claim(iii) which is not in the possession of the Borrower or such Subsidiary unless (A) the Loan and Collateral Agent has received a waiver from the party in possession of such inventory in form and substance satisfactory to the Loan and Collateral Agent or (B) such inventory is In-Transit Inventory, encumbrance (iv) which is held by the Borrower or security interest; such Subsidiary on property leased by the Borrower or a Subsidiary, unless the Loan and Collateral Agent has received a waiver from the lessor of such leased property and, if any, sublessor thereof in form and substance satisfactory to the Loan and Collateral Agent, (cv) The item as to which (other than with the case of Inventory has In- Transit Inventory) appropriate Uniform Commercial Code financing statements showing the Borrower or such Subsidiary as debtor and the Loan and Collateral Agent as secured party have not been consignedfiled in the proper filing office or offices in order to perfect the Loan and Collateral Agent's security interest therein, sold or leased (vi) which has been shipped to any Person; (d) Each a customer of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect Borrower or such item Subsidiary regardless of Inventory at the date that the most recent Inventory Report was delivered to Lender; whether such shipment is on a consignment basis, (evii) The item of Inventory was not purchased by Borrower in or as part of a "bulk" transfer or sale of assets unless Borrowerwhich, and the seller of such item, have complied with all applicable bulk sales or bulk transfer laws; (f) The item of Inventory does not consist of workother than In-in-process or packaging or supplies; (g) The item of Inventory is not slow moving Transit Inventory, is not out located within the United States of date Inventory America, (viii) which the Loan and is Collateral Agent reasonably deem to be not consigned marketable, (ix) scrap inventory, held coils (i.e. coils not used for initial orders) in excess of $1,000,000 at any time, and "Other Inventory; " as classified by the Borrower on its financial statements as of the Balance Statement Date, or (hx) The item of Inventory is in the possession of Borrower but is not which has been owned by Borrower; the Borrower or such Subsidiary for more than one (i1) The item of Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item of Inventory is not stored at a leased or warehouse location, unless in respect to such leased or warehouse location, Lender has received a landlord waiver or bailee letter in form and substance acceptable to Lenderyear.

Eligible Inventory. Upon With respect to the delivery Borrower or any of its Subsidiaries, finished goods, work in progress, supplies, packaging materials and raw materials and component parts inventory owned by the Borrower to Lender of an or such Subsidiary; PROVIDED that Eligible Inventory Report, Lender shall determine, in its sole and absolute discretion, which items of Inventory listed thereon is Eligible Inventory. In making this determination, Lender will consider the following requirements: not include any inventory (ai) The item of Inventory is in good condition, meets all standards imposed by any governmental agencyheld on consignment, or department or division thereof, having regulatory authority over such goods, their use or sale, is not obsolete, is in good condition and is either currently useable or currently saleable in the ordinary course of Borrower's business and is not otherwise unacceptable owned by the Borrower or such Subsidiary, or of a type no longer sold by the Borrower or such Subsidiary, (ii) which has been returned by a customer (until an appropriate adjustment has been made to Lender due to age, type, category the corresponding Account Receivable and so long as such inventory is undamaged and in saleable condition) or quantity; (b) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto damaged or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any legal encumbrance other lienthan Permitted Liens, claim, encumbrance or security interest; (ciii) The item of Inventory has not been consigned, sold or leased to any Person; (d) Each of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in or as part of a "bulk" transfer or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales or bulk transfer laws; (f) The item of Inventory does not consist of work-in-process or packaging or supplies; (g) The item of Inventory which is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory; (h) The item of Inventory is in the possession of the Borrower but is not owned by Borrower; (i) The item of Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item of Inventory is not stored at a leased or warehouse location, Subsidiary unless in respect to such leased or warehouse location, Lender the Agent has received a landlord waiver or bailee letter from the party in possession of such inventory in form and substance acceptable satisfactory to Lenderthe Agent, (iv) which is held by the Borrower or such Subsidiary on property leased by the Borrower or a Subsidiary, unless the Agent has received a waiver from the lessor of such leased property and, if any, sublessor thereof in form and substance satisfactory to the Agent, (v) as to which appropriate Uniform Commercial Code financing statements showing the Borrower or such Subsidiary as debtor and the Agent as secured party have not been filed in the proper filing office or offices in order to perfect the Agent's security interest therein, (vi) which has been shipped to a customer of the Borrower or such Subsidiary regardless of whether such shipment is on a consignment basis (unless, with respect to any such inventory held on consignment by a third party, all relevant provisions of ss.ss.2-326 and 9-114 of the Uniform Commercial Code have been complied with and the Agent has a valid and perfected first priority security interest therein), (vii) which is not located within the United States of America, or (viii) which the Agent reasonably deems to be obsolete or not marketable. General criteria for Eligible Inventory may be established and revised from time to time by the Agent in its reasonable business judgement. Notwithstanding section (iv) of this definition, the requirement for Landlord Consents and Waivers shall be waived with respect to the properties which are leased by the Borrower as of the Closing Date; PROVIDED, HOWEVER, if the lease for any such property shall be amended, restated, renewed or otherwise modified, section (iv) shall once more be in full force and effect.

Eligible Inventory. Upon the delivery Inventory owned by a Borrower to Lender of an Inventory Report, Lender shall determinethat Agent, in its sole and absolute discretionPermitted Discretion, which items of Inventory listed thereon is deems to be Eligible Inventory. In making this determinationWithout limiting the foregoing, Lender will consider the following requirements: no Inventory shall be Eligible Inventory unless it (a) The item of Inventory is finished goods built pursuant to a customer order, raw materials or work-in-process and not packaging or shipping materials, labels, samples, display items, bags, replacement parts, service parts or manufacturing supplies; (b) is not held on consignment; (c) is not subject to any deposit or down payment; (d) is in good conditionnew and saleable condition and is not damaged, defective, shopworn or otherwise unfit for sale; (e) is not slow-moving, perishable, obsolete or unmerchantable, and does not constitute returned or repossessed goods; (f) meets all standards imposed by any governmental agencyGovernmental Authority, has not been acquired From a Person that is the target of any Sanction or department on any specially designated nationals list maintained by OFAC, and does not constitute hazardous materials under any Environmental Law; (g) conforms with the covenants and representations herein; (h) is subject to Agent’s duly perfected, first priority Lien, and no other Lien (other than Permitted Liens); (i) is within the continental United States or division thereof, having regulatory authority over such goods, their use or sale, Canada; is not obsoletein transit except between locations of Borrowers, is in good condition and is either currently useable between locations of a vendor to a location of a Borrower or currently saleable in the ordinary course between a location of a Borrower to a customer of a Borrower's business ; and is not otherwise unacceptable consigned to Lender due to age, type, category or quantity; any Person; (bj) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance warehouse receipt or security interest; negotiable Document; (ck) The item of Inventory has is not been consigned, sold or leased subject to any Person; License or other arrangement that restricts such Borrower’s or Agent’s right to dispose of such Inventory, unless Agent has received an appropriate Lien Waiver or has otherwise waived such requirement; and (dl) Each of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; is located (ex) The item of Inventory was not purchased by Borrower in or as part on a leased premises of a "bulk" transfer or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales or bulk transfer laws; (fy) The item of Inventory does not consist of work-in-process or packaging or supplies; (g) The item of Inventory is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory; (h) The item of Inventory is in the possession of Borrower but is not owned by Borrower; (i) The item a warehouseman, processor, repairman, mechanic, shipper, freight forwarder or other Person, and, to the extent the aggregate book value of Inventory does not consist of dock fees at such location is greater than $1,000,000 the lessor or such Person has delivered a Lien Waiver or an appropriate Rent and Charges Reserve has been established or Agent has otherwise waived such requirement, or (or "inside margin" as such term is used or referred to by Borrower); and (jz) The item of Inventory is not stored at a leased or warehouse location, unless customer location and in respect to the process of being evaluated by the applicable customer for acceptance by such leased or warehouse location, Lender has received customer under the terms of the sale contracts between a landlord waiver or bailee letter Borrower and such customer; and (m) is reflected in form and substance acceptable to Lenderthe details of a current perpetual inventory report.

Eligible Inventory. Upon The following shall constitute the delivery by Borrower to Lender of an Inventory Report, Lender shall determine, in its sole and absolute discretion, which items Eligibility Criteria for acceptance of Inventory listed thereon is Eligible Inventoryfor inclusion in the Borrowing Base. In making this determinationAll Inventory of the Loan Parties, Lender will consider valued at the lower cost or market in accordance with GAAP, but excluding any Inventory having any of the following requirementscharacteristics: (a) The item Inventory that is in-transit; located at any warehouse, job site or located on any other premises that may be subject to the Lien of Inventory is in good condition, meets all standards imposed by any governmental agency, or department or division thereof, having regulatory authority over such goods, their use or sale, is not obsolete, is in good condition and is either currently useable or currently saleable in person other than the ordinary course of Borrower's business and is not otherwise unacceptable to Lender due to age, type, category or quantityCollateral Agent; (b) The item of Inventory that is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance or security interesta duly perfected first priority Lien in the Collateral Agent’s favor; (c) The item Inventory that is subject to (x) a Lien in favor of Inventory has not been consigned, sold any Person other than the Lender other than the ABDC Lien that is subject to the ABDC Intercreditor Agreement and (y) the Lien of a supplier or leased similar creditor of any of the Loan Parties that is subject to any Persona Supplier Intercreditor Agreement; (d) Each Inventory covered by any negotiable or non-negotiable warehouse receipt, ▇▇▇▇ of lading or other document of title; on consignment from any Person; on consignment to any Person or subject to any bailment unless such consignee or bailee has executed an agreement with the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in Supplies, packaging, parts or as part of a "bulk" transfer sample Inventory, or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales customer supplied parts or bulk transfer lawsInventory; (f) The item of Inventory does not consist of workWork-in-process or packaging or suppliesInventory; (g) The item of Inventory that is not damaged, defective, obsolete, slow moving Inventoryor not currently saleable in the normal course of Borrower’s operations, is not out or the amount of date such Inventory and is not consigned Inventorythat has been reduced by shrinkage; (h) The item of Inventory that the Borrower has returned, has attempted to return, is in the possession process of Borrower but is not owned by Borrowerreturning or intends to return to the vendor thereof; (i) The item of Inventory does not consist of dock fees that is perishable or live or 30 days from expiration; (or "inside margin" as j) Inventory stored at locations outside the United States; (k) Inventory formulated by a Loan Party pursuant to a license unless the applicable licensor has agreed in writing to permit the Collateral Agent to exercise its rights and remedies against such term is used or referred to by Borrower)Inventory; and (jl) The item Inventory that is classified as controlled substances, C2 or other controlled substances or pharmaceuticals unless the applicable Loan Party (i) possesses a specialized license from the U.S. Drug Enforcement Agency or other federal, state or local authority to sell or dispose of Inventory same, or (ii) is not stored at a leased otherwise prohibited under applicable law from selling or warehouse location, unless in respect to such leased or warehouse location, Lender has received a landlord waiver or bailee letter in form and substance acceptable to Lenderotherwise disposing of same.

Eligible Inventory. Upon the delivery Inventory owned by Borrower to Lender of an Inventory Report, Lender shall determinethat Agent, in its sole and absolute discretion, which items of Inventory listed thereon is reasonably exercised, deems to be Eligible Inventory. In making this determinationWithout limiting the foregoing, Lender will consider the following requirements: no Inventory shall be Eligible Inventory unless it (a) The item of Inventory is finished goods (other than food, magazines or books), and is not raw materials, a work-in-process, packaging or shipping materials, labels, samples, display items, replacement parts or manufacturing supplies; (b) is not held on consignment, nor subject to any deposit or downpayment; (c) is in good conditionnew and saleable condition and is not damaged, shopworn or otherwise unfit for sale; (d) is not slow-moving, defective, obsolete or unmerchantable, and does not constitute returned or repossessed goods; (e) meets all standards imposed by any governmental agencyGovernmental Authority, and does not constitute hazardous materials under any Environmental Law, and has not been produced in violation of the FLSA (as it may be reasonably determined by Agent) if such violation could reasonably be expected to result in any prohibition in the sale of such Inventory by Borrower or department Agent; (f) conforms with the covenants and representations herein; (g) is subject to Agent’s duly perfected, first priority Lien, and no other Lien; (h) is within the continental United States or division thereof, having regulatory authority over such goods, their use or saleCanada, is not obsolete, is in good condition and is either currently useable or currently saleable in the ordinary course transit except between locations of Borrower's business , and is not otherwise unacceptable consigned to Lender due to age, type, category or quantity; any Person; (bi) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance warehouse receipt or security interest; negotiable Document; (cj) The item of Inventory has is not been consigned, sold or leased subject to any Person; (d) Each of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date License or other arrangement that the most recent Inventory Report was delivered restricts Borrower’s or Agent’s right to Lender; (e) The item of Inventory was not purchased by Borrower in or as part of a "bulk" transfer or sale of assets unless Borrower, and the seller dispose of such itemInventory, have complied with all applicable bulk sales or bulk transfer laws; unless Agent has received an appropriate Lien Waiver; (fk) The item of Inventory does not consist of work-in-process or packaging or supplies; (g) The item of Inventory is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory; (h) The item of Inventory is located on leased premises or in the possession of Borrower but is not owned by Borrower; a warehouseman, processor, repairman, mechanic, shipper, freight forwarder or other Person (other than an Obligated Party), unless the lessor or such Person has delivered a Lien Waiver or an appropriate Rent and Charges Reserve has been established, provided that in the case of leased locations, a Lien Waiver or an appropriate Rent and Charges Reserve will only be required for (i) The item the location in Van Nuys, California and (ii) leased locations if, and only if, the lessor has, by law, a statutory landlord’s lien on any property of Inventory does not consist Borrower located at such premises; and (l) is reflected in the details of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item of Inventory is not stored at a leased or warehouse location, unless in respect to such leased or warehouse location, Lender has received a landlord waiver or bailee letter in form and substance acceptable to Lendercurrent perpetual inventory report.

Eligible Inventory. Upon With respect to the delivery Borrowers (other than Holdings, MFC and Xomed P.R.) and the Subsidiaries of Xomed International, Inc., finished goods and raw materials inventory owned by Borrower to Lender the Borrowers (other than Holdings, MFC and Xomed P.R.) or the Subsidiaries of an Xomed International, Inc.; PROVIDED that Eligible Inventory Reportshall not include any inventory (i) held on consignment, Lender shall determine, in its sole and absolute discretion, which items of Inventory listed thereon is Eligible Inventory. In making this determination, Lender will consider the following requirements: (a) The item of Inventory is in good condition, meets all standards imposed or not otherwise owned by any governmental agencysuch Person, or department of a type no longer sold by such Person, (ii) which has been returned by a customer or division thereof, having regulatory authority over such goods, their use is damaged or sale, is not obsolete, is in good condition and is either currently useable or currently saleable in the ordinary course of Borrower's business and is not otherwise unacceptable to Lender due to age, type, category or quantity; (b) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any legal encumbrance other lienthan Permitted Liens, claim, encumbrance or security interest; (ciii) The item of Inventory has not been consigned, sold or leased to any Person; (d) Each of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in or as part of a "bulk" transfer or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales or bulk transfer laws; (f) The item of Inventory does not consist of work-in-process or packaging or supplies; (g) The item of Inventory which is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory; (h) The item of Inventory is in the possession of Borrower but is not owned by Borrower; (i) The item of Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item of Inventory is not stored at a leased or warehouse location, Person unless in respect to such leased or warehouse location, Lender the Agent has received a landlord waiver or bailee letter from the party in possession of such inventory in form and substance acceptable satisfactory to Lenderthe Agent, (iv) which is held by such Person on property leased by such Person, unless (A) the Agent has received a waiver from the lessor of such leased property and, if any, sublessor thereof in form and substance satisfactory to the Agent or (B) the Agent has waived in writing such requirement for such property, (v) as to which appropriate Uniform Commercial Code financing statements showing such Person (other than such Subsidiaries) as debtor and the Agent as secured party have not been filed in the proper filing office or offices in order to perfect the Agent's security interest therein, (vi) which has been shipped to a customer of such Person regardless of whether such shipment is on a consignment basis, (vii) which the Majority Banks reasonably deem to be obsolete or not marketable or (viii) which is a so-called "demonstration system" or is otherwise in the possession of any sales representative of any of the such Persons.

Eligible Inventory. Upon All of the delivery inventory owned by the Borrower and reflected in the most recent Borrowing Base Certificate delivered by Borrower to Lender of an Inventory Report, Lender Bank shall determine, in its sole and absolute discretion, which items of Inventory listed thereon is be “Eligible Inventory. In making ” for purposes of this determinationAgreement, Lender will consider the following requirementsEligible Inventory shall not include any Inventory of Borrower that: (a) The item is not owned by Borrower free and clear of Inventory all liens and rights of any other person (including the rights of a purchaser that has made progress payments and the rights of a surety that has issued a bond to assure Borrower’s performance with respect to that Inventory), except the liens in favor of Bank and Permitted Liens; (b) (i) is located on premises owned or leased by Borrower and is not encumbered by a mortgage or deed of trust, in each case in favor of Lender, or (ii) is located at an owned or leased location subject to a mortgage in favor of a person other than Lender; (c) is placed on consignment or is in good conditiontransit; (d) obsolete, meets all standards imposed slow moving (in excess of one year’s supply), unsalable, damaged or unfit for sale; however, Reserve Seed Inventory that otherwise qualifies shall be deemed Eligible Inventory; (e) consists of display items or packing or shipping materials, manufacturing supplies, stores or replacement parts; (f) consists of goods which have been returned by any governmental agency, or department or division thereof, having regulatory authority over such goods, their use or sale, the buyer; (g) is not obsolete, is in good condition and is either currently useable or currently saleable of a type held for sale in the ordinary course of Borrower's business and is not otherwise unacceptable to Lender due to age, type, category or quantity; (b) The item of Inventory is located at one of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance or security interest; (c) The item of Inventory has not been consigned, sold or leased to any Person; (d) Each of the warranties and representations set forth in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in or as part of a "bulk" transfer or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales or bulk transfer laws; (f) The item of Inventory does not consist of work-in-process or packaging or supplies; (g) The item of Inventory is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory’s business; (h) The item of Inventory is in the possession of Borrower but is not owned by Borrowersubject to a first priority lien in favor of Lender; (i) The item breaches any of the representations or warranties pertaining to Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); andset forth in the Loan Documents in any material respect; (j) The item consists of Inventory any costs associated with “freight-in” charges, except those charges that are customary in, and consistent with, Borrower’s historical accounting practices; (k) consists of Hazardous Materials or goods that can be transported or sold only with licenses that are not readily available; (l) is not stored at a leased or warehouse location, unless in respect to such leased or warehouse location, Lender has received a landlord waiver or bailee letter in form and substance covered by casualty insurance reasonably acceptable to Lender; or (m) is subject to any patent or trademark license requiring the payment of royalties or fees or requiring the consent of the licensor for a sale thereof by Lender which has not been obtained.

Eligible Inventory. Upon the Borrowers' delivery by Borrower to Lender of an ------------------ Inventory Report, Lender shall determineshall, in its sole and absolute reasonable discretion, determine which items of Inventory listed thereon is are Eligible Inventory. In making this determinationUnless otherwise agreed to by Lender, Lender will consider Eligible Inventory shall, at all times, be subject to the following requirementsrequirements for eligibility: (a) The item of Inventory is shall constitute raw materials or finished goods, shall be in good condition, meets meet all standards imposed by any governmental agency, agency or department or division thereof, thereof having regulatory authority over such goods, goods or their use or sale, is not obsolete, is in good condition and is shall be either currently useable usable or currently saleable in the ordinary course of a Borrower's business and is shall not otherwise be unacceptable to Lender due to age, type, category category, quality or quantity; (b) The item of Inventory is shall be located at one of the locations of Borrower listed on Exhibit D "C" attached hereto or as otherwise hereinafter agreed to by Lenderhereto, is shall be subject to and ----------- covered by Lender's perfected security interest and is shall not be subject to any other lien, claim, encumbrance or security interest; (c) The item of Inventory has shall not have been consigned, sold or leased to any Person; (d) The item of Inventory shall not have been purchased by a Borrower in or as part of a bulk transfer or sale of assets unless there was compliance, or an exemption from compliance, with all applicable bulk sales or transfer laws; (e) The item of Inventory may have been relieved from a Borrower's Inventory supply and may be accounted for by such Borrower as an "unbilled" Account, provided such Borrower can document the status of such item of Inventory to Lender's satisfaction; (f) Each of the warranties and representations set forth in Section 9.3 has been shall be reaffirmed with respect to such item of Inventory at ----------- the date time that the most recent Inventory Report was delivered to Lender; (e) The item of Inventory was not purchased by Borrower in or as part of a "bulk" transfer or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales or bulk transfer laws; (f) The item of Inventory does not consist of work-in-process or packaging or supplies;; and (g) The item of Inventory is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory; (h) The item of Inventory is in the possession of Borrower but is not owned by Borrower; (i) The item of Inventory does not consist of dock fees (or "inside margin" as such term is used or referred to by Borrower); and (j) The item of Inventory is not stored at a leased or warehouse location, unless in respect to such leased or warehouse location, Lender has received a landlord waiver or bailee letter in form and substance shall otherwise be acceptable to Lender, in its reasonable discretion.

Eligible Inventory. Upon The term AELIGIBLE INVENTORY@ means all INVENTORY owned by either or both of the delivery BORROWERS which is acceptable to the LENDER to be included in the calculation of the BORROWING BASE. The criteria for eligibility may be fixed and revised by Borrower the LENDER from time to Lender of an Inventory Report, Lender shall determine, time in its sole and absolute discretion, which items of Inventory listed thereon is Eligible Inventory. In making this determination, Lender will consider the following requirements: INVENTORY in no event shall be deemed to be eligible unless: (a) The item of Inventory is the LENDER has a first priority perfected security interest in good conditionthe INVENTORY; (b) no vender, meets all standards imposed by supplier or other PERSON claims any governmental agency, security interest or department lien in or division thereof, having regulatory authority over such goods, their use or sale, to the INVENTORY which is not obsolete, expressly subordinated to the LENDER'S securities interests or liens therein; (c) it is in good condition normally and is either currently useable or currently saleable in the ordinary course of Borrower's business and is not otherwise unacceptable to Lender due to age, type, category of either or quantity; (b) The item of Inventory is located at one both of the locations of Borrower listed on Exhibit D attached hereto or as otherwise hereinafter agreed to by Lender, is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance or security interest; (c) The item of Inventory has not been consigned, sold or leased to any Person; BORROWERS; (d) Each of the warranties and representations set forth it is not raw materials or work in Section 9.3 has been reaffirmed with respect such item of Inventory at the date that the most recent Inventory Report was delivered to Lender; process; (e) The item it is located on the premises of Inventory was not purchased by Borrower in or as part either of a "bulk" transfer or sale of assets unless Borrower, and the seller of such item, have complied with all applicable bulk sales or bulk transfer laws; BORROWERS; (f) The item of Inventory it does not consist of work-in-process obsolete, returned or packaging repossessed items of INVENTORY or supplies; used goods or goods taken in trade; (g) The item of Inventory is not slow moving Inventory, is not out of date Inventory and is not consigned Inventory; (h) The item of Inventory is in the possession of Borrower but is not owned by Borrower; (i) The item of Inventory it does not consist of dock fees slow moving items or items determined by the LENDER in its sole discretion to be stale or dated merchandise; (h) it does not consist of packing materials, catalogs, promotion materials, items used as demonstrators, prototypes, or "inside margin" as such term is used salesman=s samples; (i) it does not consist of an item consigned to either or referred both of the BORROWERS or with respect to by Borrower)which any PERSON claims a lien; and (j) The item it has not been consigned by either or both of Inventory the BORROWERS to a consignee; (k) it has not been leased by any PERSON; (l) it is not stored at held by any PERSON (other than the BORROWER) or located upon any premises not owned in fee simple by the BORROWER unless such PERSON or the owner of such premises has executed a leased or warehouse location, unless in respect to such leased or warehouse location, Lender has received a landlord lien waiver or bailee letter agreement in form and substance acceptable satisfactory to Lenderthe LENDER; and (m) it has not been deemed unsatisfactory by the LENDER for any reason, in the LENDER=S sole discretion, by written notice to either or both of the BORROWERS. The value of any INVENTORY deemed to meet the criteria for ELIGIBLE INVENTORY shall be determined at the least of: (i) the BORROWERS= net purchase or manufacturing cost; (ii) the lowest then-existing market price; (iii) the BORROWERS= lowest selling price, less estimated expenses for packing, selling and delivery; or (iv) any price ceiling which may be established by governmental order, regulation, or restriction. The LENDER shall be the discretionary judge of the value of any INVENTORY, based upon such information as it deems in its discretion to be relevant or applicable in making that determination.