Exhibit 10.2

SUPPLY AGREEMENT

This Supply Agreement (“Agreement”) is made effective as of September 16, 2009 (“Effective Date”), by and between Accuray Incorporated, a Delaware corporation having its principal place of business at 1310 Chesapeake Terrace, Sunnyvale, California 94089 (“Accuray”), and American Science and Engineering, Inc., a Massachusetts corporation located at 829 Middlesex Turnpike, Billerica, Massachusetts 01821(“AS&E”).

WHEREAS, AS&E and Accuray have a mutual interest in continuing their business relationship in the development and production of linear accelerators for use in security systems;

WHEREAS, each of AS&E and Accuray have rights to certain intellectual property useful in the development and production of linear accelerators;

WHEREAS, AS&E and Accuray wish to use their respective intellectual property in the development and production of linear accelerators for security applications; and

WHEREAS, Accuray manufactures and sells certain products incorporating side-coupled standing wave X-band linear architecture and other traveling wave linear accelerator systems, including those specified in Exhibit A (“Products”) and AS&E desires to purchase certain of Accuray’s Products, subject to and in accordance with the terms and conditions of this Agreement.

NOW, THEREFORE, the parties hereby agree as follows:

1.                            TERM

1.1.                   Term.  The term of this Agreement shall be for an initial period of three (3) years commencing on the Effective Date unless it is sooner terminated as provided herein or extended for additional one (1) year terms in a writing signed by both parties.  Both parties reserve the right to hold Agreement review meetings on an as needed basis. Modification to the Agreement can be made at any time upon written mutual agreement executed by authorized representatives of the parties.

2.                            PRODUCTS AND ORDER PLACEMENT

2.1.                   Means of Order Placement.  A “Purchase Order” shall mean AS&E’s documentation initiating a purchase request for Products from Accuray. AS&E shall order Products from Accuray by delivering a Purchase Order to Accuray.  AS&E’s Purchase Order shall set forth the number of each unit of Products it desires to purchase at the prices established for such Products in accordance with Section 6 and the delivery date for units established in accordance with Section 2.2 hereof.  Purchase Orders may be delivered to Accuray in writing by any reasonable means, including, but not limited to personal delivery, postal delivery, courier delivery, facsimile transmission and electronic mail provided that any such transmission references a Purchase Order number.  AS&E shall pay Accuray for all Products ordered pursuant to a Purchase Order in accordance with the terms of this Section 2 and Section 6.2 hereof.

Confidential treatment has been requested for portions of this exhibit. The copy filed herewith omits the information subject to the confidentiality request. Omissions are designated as [*]. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission.

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2.2.                   Lead Time.  Accuray’s required lead time for delivery of Products following receipt and acceptance of a Purchase Order from AS&E (“Lead Time”) may vary, but the minimum Lead Time required for timely delivery of Products by Accuray shall be eighteen (18) weeks from acceptance by Accuray of an AS&E Purchase Order (“Minimum Lead Time”).  If Accuray requires additional Lead Time in excess of the Minimum Lead Time to fulfill a Purchase Order, Accuray will advise AS&E of the additional Lead Time required prior to issuing a Quote in accordance with Section 2.4 below or as soon as reasonably practicable following discovery of the delay.  Accuray will use commercially reasonable efforts to accommodate Purchase Orders from AS&E requesting delivery of Products with less than the Minimum Lead Time, provided, however, that Accuray shall have no liability for its failure to deliver Products in advance of the Minimum Lead Time and AS&E shall reimburse Accuray for the amount of any reasonable, documented additional costs incurred in order to accommodate the shorter Lead Time.

2.3.                   Terms of Purchase Order.  When in conflict, this Agreement will take precedence over any terms and conditions that may be specified in an AS&E Purchase Order. Additional or different terms, including those submitted as a part of AS&E’s Purchase Order standard terms and conditions, shall not modify the terms of this Agreement.

2.4.                   Order Confirmation.  Following receipt of a Purchase Order, Accuray will provide a quote to AS&E in respect of the Products requested in such Purchase Order as confirmation and acceptance of the order (“Quote”).  Accuray shall without undue delay and at the latest within ten (10) working days of receipt of a Purchase Order either: (i) provide a Quote to AS&E in relation to the Products requested in such Purchase Order, or (ii) advise AS&E that it rejects the Purchase Order and the reason(s) why Accuray objects to the Purchase Order terms and a Quote is not provided by Accuray, provided, however, that with respect to standing wave Products, Accuray shall not reject any Purchase Order that conforms to the requirements of this Agreement.  Once received from Accuray, AS&E shall execute and return such Quote to Accuray within two (2) working days.

2.5.                   Quote Cancellation.  AS&E may cancel a Purchase Order (and the associated Quote) at any time upon fifteen (15) days prior written notice to Accuray. If a Quote has been executed and accepted by Accuray, AS&E shall, with respect to such cancelled Quote, be liable to pay Accuray charges equal to the total purchase price for each Product unit ordered under the applicable Quote multiplied by the percent completion of the relevant Product unit at the time of such cancellation request up to a maximum amount of the total purchase price for the Products under the relevant Quote as reasonably determined by Accuray (“Percentage Payment”).  As soon as reasonably practicable following receipt of a cancellation notice from AS&E, Accuray will cease work on the Products the subject of the cancelled Quote and use commercially reasonable efforts to return purchased materials already received from its suppliers.  AS&E shall be entitled to audit the calculation of the Percentage Payment as follows:

(i)                                   If AS&E agrees with the Percentage Payment calculation, it shall remit payment of such amount to Accuray within thirty (30) days of receipt of such calculation.

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(ii)                                If AS&E disputes the Percentage Payment calculation, AS&E shall, within thirty (30) days following AS&E’s receipt of the Percentage Payment calculation from Accuray, (A) notify Accuray in writing (“Audit Notice”) of its intent to audit the Percentage Payment calculation and (B) designate an independent third party auditor reasonably acceptable to Accuray (“Auditor”) to perform the audit.

(iii)                             Within fifteen (15) days following receipt of the Audit Notice from AS&E, Accuray will provide to the Auditor the documentation used by Accuray to determine the Percentage Payment calculation, including the cost of materials and outside labor purchased by Accuray and the cost of labor of Accuray’s personnel, and any additional documentation reasonably requested by the Auditor required to confirm the Percentage Payment calculation performed by Accuray (collectively “Back-up Documentation”).  The Auditor’s audit and examination of the Percentage Payment calculation will be limited to a determination of whether the Percentage Payment provided by Accuray is accurate based on the Back-up Documentation provided, and, prior to receiving such documentation, the Auditor shall be required to execute a non-disclosure agreement with Accuray and agree not to disclose Accuray’s confidential and sensitive pricing information to AS&E or any third parties.

(iv)                            The Auditor shall complete its audit of the Percentage Payment calculation within sixty (60) days of Accuray’s receipt of the Audit Notice and provide the results of such audit to AS&E and Accuray in writing.  If the audit results confirm Accuray’s calculation of the Percentage Payment or indicate that Accuray’s calculation is not more than 5% greater than the result of the Auditor’s calculation, AS&E shall be responsible for the costs and fees of the Auditor.  If the audit concludes that Accuray’s calculation of the Percentage Payment is more than 5% greater than the Auditor’s calculation, Accuray shall be responsible for the costs and fees of the Auditor.

(v)                               If the audit confirms Accuray’s calculation of the Percentage Payment, AS&E shall remit payment of such Percentage Payment amount to Accuray within thirty (30) days of receipt of the audit results from the Auditor.  If the audit results provided by the Auditor are not consistent with Accuray’s calculation of the Percentage Payment, the parties will escalate the matter to be resolved in accordance with Section 20.2.

Following payment to Accuray of the Percentage Payment for such cancelled Products, AS&E shall be the owner of any such work in progress and Accuray shall deliver the unfinished Products to AS&E at AS&E’s cost.

2.6.                   Rescheduling Product Delivery.  AS&E may request deferred delivery of Products pursuant to Quotes already accepted by Accuray, provided that AS&E cannot defer delivery of Products beyond the date that is ninety (90) days following the originally scheduled delivery date under such Quote.

2.7.                   Quarterly Forecasts.  AS&E will supply non-binding quarterly forecasts to Accuray to cover a three (3) month rolling period to be used by Accuray for its material and capacity planning

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purposes for the manufacture of Products.  AS&E will provide non-binding quarterly forecasts to Accuray no later than thirty (30) days prior to the start of the applicable quarter.  AS&E will advise Accuray as soon as practicable in writing of any significant changes in anticipated quarterly volume.

2.8.                   Long Lead-Time Parts.  The Products incorporate certain component parts sourced by Accuray from third parties that require long lead times as set forth in Exhibit B (“Long Lead-Time Parts”).   Accuray agrees to reduce the Lead Time for each Product ordered by AS&E, so long as AS&E delivers to Accuray, at least six (6) weeks prior to its Purchase Order for such Product, a purchase support order (a “Parts Purchase Support Order”) for any or all of the Long Lead-Time Parts that are components of the Product ordered. If AS&E timely submits a Parts Purchase Support Order, effective as of the delivery of such Parts Purchase Support Order, (i) Accuray shall be deemed to have confirmed and accepted the Parts Purchase Support Order in accordance with Section 2.4, (ii) the Lead Time shall be reduced to two (2) weeks plus the longest lead-time for the Long Lead-Time Parts required for the Product that are not included in the Parts Purchase Support Order, and (iii) Accuray shall reserve in inventory, exclusively for Products delivered to AS&E, the Long Lead-Time Parts purchased by AS&E under such Parts Purchase Support Order.  Any Parts Purchase Support Order submitted by AS&E hereunder shall be deemed cancelled upon the delivery by Accuray to AS&E of Products incorporating the Long Lead-Time Parts covered by such Parts Purchase Support Order.

3.                            ENGINEERING AND PROCESS CHANGES

3.1.                   Accuray Engineering and Process Changes.  Accuray may make Minor Engineering Changes or Required Engineering Changes without prior written approval from AS&E subject to the terms of this Section 3.  For purposes of this Agreement, “Minor Engineering Changes” means those that do not alter the form, fit or function, reliability, performance or maintainability of (i) the Products received by AS&E, or (ii) products or systems distributed by AS&E in combination with the Products.  Product “Required Engineering Changes” means those that are required to make the Product conform to applicable regulations and legal requirements.  In the event that Accuray proposes any Minor or Required Engineering Changes to the Products, it shall (i) provide AS&E with a reasonable opportunity to review such proposed modifications, (ii) accept reasonable accommodations requested by AS&E and (iii) notify AS&E in writing of such change at least thirty (30) calendar days prior to the implementation of such modification.

3.2.                   AS&E Engineering Changes.  AS&E may from time to time request in writing that Accuray implement engineering or design changes in the Products or revisions to the Product Specification (as defined below) or Acceptance Test Procedure (as defined below) (“Engineering Changes”).  Such request shall be accompanied by an Engineering Change Order (“ECO”) with a written description of the proposed Engineering Change sufficient to permit Accuray to evaluate its feasibility, drawings, media, and a proposed implementation date.  Within thirty (30) business days of such request, Accuray will advise AS&E in writing of the conditions under which Accuray will implement the Engineering Change and the basis for such conditions (including applicable supporting documentation therefor).  Accuray’s evaluation will include, at a minimum, the impact on delivery, the additional cost to AS&E

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to implement the Engineering Change or resulting cost savings, as applicable, and the cost of reimbursement to Accuray for any obsolete materials and rework for open orders that results from the implementation of any Engineering Changes.

3.3.                   Accuray Engineering Change Requests.  Accuray may from time to time request in writing an Engineering Change, other than a Minor or Required Engineering Change, which request shall include the basis for such Engineering Change (including applicable supporting documentation therefor), a description of any cost increase or decrease associated with the Engineering Change and any impact on delivery of Products. Within thirty (30) business days of receipt of such request, AS&E will advise Accuray in writing of its acceptance or rejection of such Engineering Change.  Accuray will continue to deliver unchanged Products in accordance with the provisions of this Agreement if the parties do not agree upon the Engineering Change.

3.4.                   Implementation of Engineering Changes.  Both parties agree to work together in good faith to implement Engineering Changes to improve the Products.  Once the parties agree to any Engineering Change, Product Specifications, Acceptance Test Procedures and Quotes shall be amended accordingly and pricing shall be adjusted in accordance with Section 6 hereof.

4.                            PRODUCT TESTING AND DELIVERY

4.1.                   Product Specifications.  Products will be delivered in accordance with the current revision of the applicable Product specification as amended by any AS&E ECOs (“Product Specification”).  The Product Specifications shall be controlled by AS&E and provided to Accuray upon request.  AS&E’s ECO procedures will require that Accuray agree in writing to any revisions to the Product Specifications.

4.2.                   Product Testing.  Products shall be tested by Accuray in accordance with the current revision of the acceptance test procedure as amended by any AS&E ECOs (“Acceptance Test Procedure”).  The current versions of the Acceptance Test Procedures are attached as Exhibit C.  The Acceptance Test Procedure shall be controlled by Accuray and provided to AS&E upon request. AS&E’s ECO procedures will require that Accuray agree in writing to any revisions to the Acceptance Test Procedure.

4.3.                   Method of Delivery.  Delivery is F.O.B. Origin at Accuray’s facility in Sunnyvale, California.  All risk and responsibility for the welfare and safekeeping of the Products shall pass to AS&E upon receipt from Accuray’s facility.  AS&E shall be responsible for all insurance and freight costs associated with the transportation and shipment of the Products from Accuray’s facility.

4.4.                   Delivery Standards.  Accuray will meet or exceed an on-time delivery requirement of ninety-five percent (95%).  Following issuance of a Quote, Accuray shall notify AS&E in writing of significant risks to meeting Delivery Dates relating to such Quote as soon as reasonably practicable.  Within 72 hours of providing such notification to AS&E, Accuray will develop plans to mitigate such delivery risk and minimize delay to the extent feasible and communicate such plans to AS&E.  Accuray and AS&E agree to work together in the event of a significant risk to meeting Delivery Dates.  Accuray shall be responsible for all costs

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and expenses it incurs to ensure delivery of Products within the Minimum Lead Time or by the Delivery Date indicated in the applicable Quote, provided that Accuray shall not be liable for any costs and expenses incurred as a result of AS&E’s delay or failure to perform its obligations hereunder.

4.5.                   Packaging.  Accuray is responsible for packaging and crating the Products for shipment to AS&E’s primary office located in Billerica, Massachusetts.  Accuray and AS&E will agree on a commercially reasonable and mutually acceptable packaging method to ensure safe delivery of the Product to its destination.

5.                            QUALITY

5.1.                   Quality System.  Accuray will measure the quality and reliability of Products delivered to AS&E during the duration of this Agreement consistent with the quality procedures maintained by Accuray.  Accuray will maintain an ISO13485 or ISO9001 certified quality system.  The quality system shall meet AS&E’s quality and product requirements which may be audited by AS&E for conformance annually at AS&E’s cost and upon reasonable prior written notice.

5.2.                   Changes to Procured Components.  Accuray will notify AS&E of any significant proposed changes in the Products related to any component procurement specification or drawing changes.  Significant changes are those with a potential to affect form, fit or function of the Products.  Accuray shall advise AS&E of the effect of such action on product quality so that AS&E may determine whether changes affect Product quality.  AS&E shall approve in writing any significant changes in the Products provided to AS&E, such approval not to be unreasonably withheld.

5.3.                   Accuray shall provide documentary support, as reasonably requested by AS&E in writing, for AS&E’s “Conformité Européenne” (CE) and “Technische Uberwachungs - Verein Rheinland” (TUV) critical components compliance requirements.

5.4.                   Product Quality.  Accuray and AS&E will cooperate on a timely basis regarding issues affecting Product quality, including AS&E customer complaints, improvement of reliability and field issues.

6.                            PRICING AND PAYMENT

6.1.                   Product Pricing.  The prices for Products shall be firm and fixed as set forth in Exhibit A; subject to adjustment as mutually agreed by the parties with respect to any design changes, Engineering Changes or other changes to Products that are requested by AS&E.

6.2.                   Time of Payment.  Accuray will send AS&E invoices upon shipment of Products.  AS&E will forward payment to Accuray net thirty (30) calendar days from the date of delivery of such Products to AS&E.

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6.3.                   No Retroactive Application of Pricing.  The Product prices provided in this Agreement apply to Quotes accepted by Accuray following the Effective Date of this Agreement and shall not apply retroactively to Product orders pending prior to the Effective Date.

7.                            INTELLECTUAL PROPERTY AND JOINT RESEARCH AND DEVELOPMENT

7.1.                   Ownership of Intellectual Property.  AS&E and Accuray are parties to an Asset Purchase Agreement, dated December 12, 2004, and certain other ancillary agreements pursuant to which Accuray purchased certain assets and intellectual property from AS&E (“Asset Purchase” and the intellectual property purchased by Accuray in that transaction, the “Purchased IP”). AS&E and Accuray are parties to a license agreement (“License Agreement”), dated December 12, 2004, pursuant to which each party licensed to the other certain exclusive and non-exclusive rights to the Purchased IP and to any improvements, modifications or enhancements thereto (“Improvements to Purchased IP”).  For the purpose of clarification, Accuray has made Improvements to Purchased IP subsequent to the Asset Purchase all of which are the intellectual property of Accuray subject to the terms of the License Agreement. Accuray has developed intellectual property on traveling wave linear accelerator technologies (“Traveling Wave IP”) which, along with any improvements, modifications and enhancements thereto, is intellectual property of Accuray to which Accuray maintains exclusive ownership and is not subject to the terms of the License Agreement.  The Purchased IP, Improvements to Purchased IP, and Traveling Wave IP make up Accuray IP that is the subject of this Agreement (“Accuray IP”) set forth in Exhibit D.  For the purpose of clarification, Accuray owns additional intellectual property that is not the subject of this Agreement, and is not included in the definition of Accuray IP, and AS&E retained ownership of certain intellectual property other than the Purchased IP that was not transferred to Accuray pursuant to the Asset Purchase, including, without limitation, the intellectual property rights described in Schedule 2.2(g) to the Asset Purchase Agreement and set forth in Exhibit E (“AS&E IP”).  Nothing in this Agreement transfers, or shall be construed to transfer, ownership or any other rights in any intellectual property between the parties.

7.2.                   Joint Research and Development.  Accuray and AS&E may agree to engage in joint development of improvements or other technology related to the Products (“R&D”) and in particular with regard to (i) detection systems for use by domestic and foreign commercial, government and military customers for security related purposes, and (ii) detection and inspection systems for use in government and commercial non-destructive evaluation of finished products of component quality (collectively, “Security Systems”).  The allocation of the costs of such R&D and the ownership of any rights, title and interest in and to the intellectual property resulting from such R&D shall be agreed between the parties in writing on a case-by-case basis prior to the commencement of any such R&D.

7.3.                   Transfer Limits of Accuray IP [*].  Accuray shall not (a) assign or transfer the Purchased IP or Improvements to Purchased IP for use in the Homeland Security or Non-Destructive Testing Markets (as such terms are defined in the License Agreement) or (b) assign or transfer the Traveling Wave IP to [*].  Notwithstanding the foregoing, Accuray may (i) continue to make, use, sell or offer for sale products incorporating the Accuray IP to third parties for use in markets other than the Homeland

[*] Certain information on this page has been redacted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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Security or Non-Destructive Testing Markets, (ii) continue to make, use, sell or offer for sale products incorporating the Traveling Wave IP and improvements thereto without restriction, (iii) assign or transfer the Accuray IP without AS&E’s prior written consent (A) in connection with a merger with, acquisition by, or the sale of all or substantially all of Accuray’s assets to any successor or acquirer without restriction, and (B) in connection with a sale or other transfer of all of or substantially all of Accuray’s Linear Accelerator Division to any successor or acquirer[*], so long as the successor or acquirer agrees to, and does, assume Accuray’s obligations hereunder and under the License Agreement, and (iv) assign, transfer, dispose or sell any of Accuray’s intellectual property, except the Accuray IP, to any entity without restriction.

8.                            TERMINATION

8.1.                   Termination for Convenience.  Either party may terminate this Agreement at any time without cause by giving the other not less than six (6) months prior written notice.  In the event that either party elects to terminate this Agreement, AS&E may continue to submit Purchase Orders during the six (6) month termination notice period, and Accuray agrees to provide Quotes for such Purchase Orders in accordance with the terms of this Agreement.

8.2.                   Termination for Cause by Either Party.  If either party breaches a material provision of this Agreement, the non-defaulting party may terminate this Agreement if the breaching party fails to remedy such breach within thirty (30) days following receipt of written notice of such breach.

8.3.                   Long Lead-Time Parts following Termination.  In the event that any Parts Purchase Support Orders issued by AS&E in accordance with Section 2.8 remain outstanding at the termination or expiration of this Agreement, Accuray shall use commercially reasonable efforts to utilize the Long Lead-Time Parts covered by such Parts Purchase Support Order in other Accuray products or attempt to resell such Long Lead-Time Parts to a third party, including the original supplier of such materials, within 90 days of such termination (“Run-Off Period”).  If the Agreement is terminated by AS&E under Section 8.1 and Accuray is unable to use or return such Long Lead-Time Parts within the Run-Off Period, then upon expiration of the Run-Off Period, Accuray shall provide written notice to AS&E specifying the Long Lead-Time Parts ordered by AS&E remaining in Accuray inventory, together with documentation supporting the inventory value of such Long Lead-Time Parts (the “Unit Cost”), and any out-of-pocket costs incurred by Accuray for unusual disposal of hazardous or regulated materials (“Special Disposal Costs”).  If AS&E agrees with the Unit Cost and Special Disposal Costs reflected in the notice it receives from Accuray, within 30 days following receipt of such notice, AS&E shall remit payment to Accuray in an amount equal to the total of (i) the Unit Cost, plus (ii) Special Disposal Costs, plus (iii) 10% of the Unit Cost. If AS&E disputes the Unit Cost and/or Special Disposal Costs, then, within 30 days following its receipt of the notice, AS&E shall submit an Audit Notice to Accuray and designate an Auditor, and the parties will follow the procedures set forth in Section 2.5 (iii) through (v), provided that the scope of the Audit shall be limited to the determination of whether the Unit Cost and Special Disposal Costs are an appropriate measure of Accuray’s out-of-pocket costs incurred with respect to the Long Lead-Time Parts subject to open Parts Purchase Support Orders not utilized or resold by Accuray within the Run-Off Period.  If

[*] Certain information on this page has been redacted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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within the Run-Off Period, Accuray sells any or all of such Long Lead-Time Parts to a third party at a price that is less than the Unit Cost, AS&E shall reimburse Accuray for the amount of the difference between the third party sale price and the Unit Cost.  Any excess Long Lead-Time Parts not sold or otherwise disposed of by Accuray for which AS&E has provided payment to Accuray as set forth in this Section 8.3 shall be the property of AS&E and shall be delivered to AS&E at AS&E’s cost.  In no case shall AS&E be responsible for Long Lead-Time Parts in excess of those Long Lead-Time Parts covered by Parts Purchase Support Orders submitted by AS&E as described in Section 2.8.

8.4.                   Survival of Existing Obligations.  Termination of this Agreement will not relieve the parties of any obligations incurred prior to the effective date of termination.

9.                            WARRANTIES

9.1.                   Product Warranty.  Accuray warrants that the Products delivered under this Agreement will be free from material defects in workmanship and materials and will continue to meet the relevant Product Specifications and Acceptance Test Procedures for the lesser of (i) twelve (12) months from acceptance of the Product at AS&E’s customer site as demonstrated in an acceptance certificate executed by the parties, or (ii) a period not to exceed twenty-four (24) months following the date the Products are delivered to AS&E (“Warranty Period”).

9.2.                   Warranty Remedies.  If, during the Warranty Period, a Product delivered to AS&E does not conform to the warranty provided in Section 9.1 above, AS&E will deliver a written notice of such defect to Accuray within the Warranty Period, and Accuray will promptly correct or repair such defect in accordance with this Section 9.  In the event that a defect identified by AS&E during the Warranty Period requires an emergency or time sensitive response, Accuray shall use commercially reasonable efforts to remedy such defect as soon as reasonably practicable.

9.3.                   Warranty of Returned Products.  Accuray warrants that Returned Products (as defined below) will be free from material defects in workmanship and materials for a period equal to the greater of: (i) the remaining portion of the original Warranty Period for such Product, or (ii) one hundred twenty (120) days from the date on which Accuray ships the replacement or repaired Product to AS&E.

9.4.                   Warranty Remedies.  AS&E’s exclusive remedy and Accuray’s sole liability under this Section 9 in the event of a Product warranty defect shall be for Accuray, at is option, to either repair or replace the Product found to have failed to meet the warranty provided in Section 9.1 above, provided that such defect is reported to Accuray in writing during the Warranty Period and AS&E, at Accuray’s request, provides Accuray with sufficient information or data required to reproduce the alleged Product defect.  If, after having confirmed that a Product is defective, Accuray determines that it cannot remedy such defect, or that Accuray does not have the equipment necessary to repair the defect, Accuray will provide AS&E a replacement Product.

9.5.                   Warranty Exceptions.  Accuray’s warranty of Products provided hereunder shall be void and shall not apply if a Product has been subjected to abuse, misuse, accident, alteration, neglect,

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operation inconsistent with the Product Specification or documentation, or any unauthorized repair, installation or alteration of Products by AS&E or any third party, except with respect to Product maintenance services provided by AS&E pursuant to Section 10.1 below, provided that Accuray shall not be liable for defects or damage caused by the performance of AS&E’s maintenance services.

9.6.                   EXCEPT AS PROVIDED HEREIN, ACCURAY MAKES NO REPRESENTATIONS OR WARRANITES OF ANY KIND, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, UNDER OR RELATED TO THIS AGREEMENT OR WITH RESPECT TO THE PRODUCTS OR ANY SERVICES, INCLUDING WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AND ALL SUCH WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED.

9.7.                   IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR, AND EACH PARTY COVENANTS NOT TO BRING, ANY CLAIM OR CLAIMS FOR DAMAGES IN EXCESS OF THE AMOUNTS PAID TO ACCURAY BY AS&E, OR FOR SPECIAL, CONSEQUENTIAL, INDIRECT, EXEMPLARY OR PUNITIVE DAMAGES, WHETHER OR NOT SUCH DAMAGES WERE FORESEEABLE AND EVEN IF ADVISED THAT SUCH DAMAGES WERE LIKELY TO OCCUR.

10.                     SERVICE, TRAINING AND SPARE PARTS

10.1.             AS&E Field Service.  Accuray and AS&E agree that AS&E will provide regular maintenance and will service the Products to a field replaceable unit level while the Product is operating in the field and for a period not to exceed seven (7) years after the purchase of such Products by AS&E from Accuray.

10.2.             Accuray Service.  Accuray agrees to provide warranty repair or replacement of non-performing Product field replacement units in the field.  Accuray agrees to provide maintenance service and support for the Products as currently provided by Accuray personnel for the lesser of (i) seven (7) years from the date the Product is commissioned or (ii) eight (8) years from the date the Product is shipped to AS&E, such maintenance service and support to be provided as requested by AS&E and at AS&E’s cost in accordance with Accuray’s then current time and materials rates.

10.2.1.             Technical Phone Support.  Accuray will provide and maintain technical phone support for AS&E field service technicians during the Term of this Agreement Monday through Friday from 9 a.m. to 5 p.m. Pacific time (excluding weekends and holidays); provided, however, that AS&E will designate a technical trainer to provide in-house first line response for AS&E technical support requests.  If AS&E’s technical trainer is not able to resolve the technical support issue, the technical trainer will refer the issue to Accuray’s technical phone support line.

10.3.             Training.  AS&E shall be permitted to receive Accuray’s standard technical repair training program at Accuray’s facility in Sunnyvale, California for a maximum of three (3) personnel to be provided prior to April 1, 2010 and, thereafter, one technical training session for a

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maximum of three (3) personnel per calendar year of the remaining Term.  If AS&E does not make its personnel available to receive the allotted training within the time periods specified above, AS&E shall waive its right to receive such training.  AS&E shall be solely responsible for the travel and lodging costs incurred to send its personnel for training at Accuray’s facility.  Accuray will otherwise make available to AS&E technical repair training in accordance with Accuray’s then current technical training program. Accuray will provide its standard technical training to AS&E participants upon request, at AS&E’s cost in accordance with Accuray’s then current training rates and subject to course availability.

10.4.             Spare Parts.  Accuray and AS&E agree that AS&E’s business requires it to provide time critical spare parts for Products (“Spare Parts”) to its customers.  AS&E agrees to maintain and control its own inventory of Spare Parts that will be (i) determined by the parties on a regular basis, but no less than annually, and (ii) maintained at AS&E’s cost.  Subject to the warranty exceptions provided in Section 9.5 above, Accuray warrants that Spare Parts will be free from material defects in workmanship and materials for the lesser of one (1) year following delivery of the Spare Parts to AS&E or ninety (90) days following installation of such Spare Parts performed in accordance with AS&E’s regular practice, provided that (A) AS&E stores Spare Parts under appropriate environmental conditions required to maintain their viability, including, in particular, storage of linear accelerator guide assemblies under vacuum pump operation, including a preventative maintenance routine of re-pumping the vacuum every six (6) months, and as otherwise mutually agreed between the parties, and (B) AS&E shall not be entitled to any repair or replacement of Spare Parts pursuant to the foregoing warranty until AS&E has returned the defective Spare Part to Accuray and Accuray has completed a failure analysis confirming the defect claimed by AS&E. AS&E may request that Accuray provide repair services in relation to Spare Parts at AS&E’s cost in accordance with Accuray’s then current time and materials rates.  Accuray will use its commercially reasonable efforts to supply Spare Parts to AS&E for a period of seven (7) years from the date that the relevant Product is commissioned.

10.5.             Accuray agrees to make available Spare Parts and subassemblies for AS&E to purchase in commercially reasonable quantities during the Term of this Agreement.  Accuray or the relevant manufacturer will quality test the Spare Parts as indicated in Exhibit H prior to delivery to AS&E.

10.6.             Subject to Section 11 below and at AS&E’s request, Accuray will provide a cost estimate to AS&E that identifies the labor hours, labor costs and material costs for repair or replacement services for Products that are either out of warranty or require repairs not covered by the warranty provided by Accuray under this Agreement.  In addition, Accuray shall provide a further time and materials quotation to AS&E to the extent the issue causing the Product not to perform is different than the issue originally identified by AS&E.

10.7.             Spare Parts pricing will be no higher than that offered to Accuray’s most favored commercial customer that purchases the same Spare Parts as specified in the applicable Product Specification in an annual volume substantially similar to that purchased by AS&E.  A complete list of current Spare Parts pricing is attached to this Agreement as Exhibit H.

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10.8.             All Spare Parts are to be delivered to AS&E F.O.B. Origin at Accuray’s facility in Sunnyvale, California.  Accuray will add shipping costs to the price of Spare Parts delivered to AS&E except for Spare Parts shipped by Accuray to remedy a warranty defect as provided in Section 9 above, which shall be shipped at Accuray’s cost.

10.9.             Accuray Time and Materials Rates.  AS&E may request services from Accuray on a time and materials basis as provided in this Agreement.  These services will be provided at AS&E’s cost in accordance with Accuray’s then current service rates.  Accuray’s current hourly service rate is $350 per hour.

11.                     PRODUCT RETURNS

11.1.             Before returning Products to Accuray for repair, AS&E shall notify Accuray via email, facsimile transmission or other writing whether the Product is being returned for a warranty claim or whether AS&E’s agrees to pay Accuray’s then current time and materials rates for any out of warranty repair and request a return material authorization form (“RMA”).  Accuray will forward an RMA to AS&E, upon receipt of which AS&E will return the defective Products with prepaid freight (“Returned Product”) to Accuray for repair.

11.2.             If the Returned Product is not subject to a warranty claim, Accuray will notify AS&E and, if AS&E authorizes repair, AS&E will provide a Purchase Order to Accuray requesting repair services and Accuray’s shipment of the Returned Product back to AS&E shall be accompanied by an invoice for time and materials fees charged by Accuray for such non-warranty repair, with such invoice to be paid by AS&E within thirty (30) days after receipt.  Accuray will quality test the Returned Products as indicated in Exhibit H prior to delivering such Returned Products to AS&E.  If Accuray and AS&E mutually determine, after inspection and testing, that a Returned Product for which AS&E made a warranty claim is free of defects, Accuray’s shipment of the Returned Product back to AS&E shall be accompanied by an invoice for a “Defect Not Found” at the appropriate hourly labor charge for such determination in accordance with Section 10.9 above which AS&E shall pay within thirty (30) days of receipt.

11.3.             Accuray will provide repair services to AS&E for out-of warranty Returned Products for a period of one (1) year following the termination or expiration of this Agreement at Accuray’s then current time and materials rates.

12.                     OWNERSHIP OF DESIGNS AND INFORMATION

12.1.             IP Ownership. The ownership of intellectual property in the Products and any licenses between the parties in relation thereto are as set forth in the License Agreement and this Agreement.

12.2.             No Reverse Engineering.  AS&E shall not attempt to copy, reverse engineer, deconstruct or decompile the Products integrating the Traveling Wave IP and sold to AS&E pursuant to this Agreement.  AS&E shall not copy, reverse engineer, deconstruct or decompile any other Products sold to AS&E pursuant to this Agreement, so long as Accuray continues to timely supply Products to AS&E under the terms of this Agreement.

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12.3.             Release of Product Design Documents.  If Accuray (i) fails to comply with the provisions of this Agreement in fulfilling any Quote or (ii) fails to provide service and support as required in Section 10.2, and such failure remains uncured after thirty days written notice from AS&E, then, in such event, Accuray agrees to provide AS&E a copy of all drawings, related product manufacturing documents and software necessary to enable AS&E to manufacture or procure the Product and obtain the maintenance service support required for existing Products.

13.                     INDEMNIFICATION.

13.1.             AS&E shall indemnify and hold Accuray harmless from and against any and all liability, damages, costs, losses and expenses (“Costs”) arising out of or in connection with any personal injury, including death, or any damage to property or business which may be suffered by Accuray, its agents or employees or by any third party, arising out of or in connection with the use or operation of the Products or a failure to properly operate the Products provided under this Agreement (“Claims”), except that AS&E shall not indemnify Accuray to the extent that such damage or loss is a direct result of the negligence or willful misconduct of Accuray or a manufacturing defect of the Product.  Accuray shall indemnify and hold AS&E harmless against any and all Costs arising as a direct result of its negligence, willful misconduct or manufacturing defect of the Product to the extent such Costs reflect Accuray’s relative fault therefor.

13.2.             Intellectual Property Indemnity.  Accuray shall at its expense defend any action brought against AS&E with respect to a claim by a third party that the design or manufacture of the Products infringes any valid patent or other intellectual property right, and shall pay any damages awarded by a court arising from such claim (“IP Claim”), provided AS&E gives Accuray prompt written notice of such IP Claim and assistance in settling or defending such IP Claim.  Accuray agrees not to settle any such IP Claim without the prior written consent of AS&E (not to be unreasonably withheld).  AS&E shall have full authority to settle or defend any claims brought against it to the extent such claims do not allege that the Products infringe intellectual property rights of a third party or are otherwise excluded under Section 13.2.2.

13.2.1.             Certain Remedies.  If a court judgment prohibits AS&E’s continued use of a Product, or if at any time Accuray determines that a Product may become subject to a cause of action for infringement, Accuray may at its expense either (i) procure a license to enable AS&E to continue using such Product, (ii) replace such Product with a non-infringing Product, or (iii) remove such Product and refund a pro-rated portion of the purchase price paid by the Customer for such Product.  Accuray shall have no liability hereunder with respect to any claims settled by AS&E without Accuray’s prior written consent (not to be unreasonably withheld).

13.2.2.             Indemnity Exclusions.  Accuray shall have no liability for, and AS&E shall indemnify and hold Accuray harmless from and against any Costs incurred in relation to claimed infringement by the Product of any third party intellectual property rights to the extent such infringement arises solely from: (i) the use of a Product by AS&E or its personnel other than in the Homeland Security or Non-

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Destructive Testing markets, (ii) the combination of the Products with equipment, processes, programming applications or materials not furnished by Accuray; provided however that Accuray shall bear proportionate liability for such claim only to the extent the design or manufacture of the Product contributes to the claimed infringement, (iii) compliance by Accuray with AS&E’s designs, specifications or instructions, or (iv) AS&E’s continued use of a Product after Accuray has recommended in writing that AS&E suspend such use. This Section 13 states Accuray’s entire liability for any claim based upon or related to any alleged infringement by a Product of any third party intellectual property right.

13.3.             Indemnification Process.  The indemnities in this Section 13 are subject to (i) the indemnifying party receiving prompt written notice of the Claim, (ii) the indemnifying party having sole authority to defend or settle the Claim, and (iii) the indemnified party does not compromise or settle the Claim without the indemnifying party’s prior written consent (not to be unreasonably withheld).  The indemnified party shall provide reasonable cooperation to the indemnifying party in the defense and settlement of such Claim.

14.                     INDEPENDENT CONTRACTOR

14.1.             Independent Contractor Status.  Each of the parties hereto shall conduct the work to be performed hereunder as an independent contractor and not as an agent or employee of the other party.  Subject to the terms and conditions of this Agreement, each party shall choose the means to be employed and the manner of carrying out its obligations hereunder.  Neither party has authority, express or implied, to assume or create any obligations on the other party’s behalf with respect to Products or otherwise.  Without limiting the generality of the foregoing, neither party shall make any representation, guarantee or warranty on the other party’s behalf, except that AS&E may provide end-user customers with certain Product performance metrics that are published by Accuray.  Neither party shall use the other party’s company name, logo, artwork designs or abbreviations thereof in any way that may result in confusion in relation to AS&E and Accuray being separate entities.

15.                     COMPETITION

15.1.             Competition.  Except as provided in the License Agreement and Section 7.3 above, nothing in this Agreement shall limit the right of Accuray or AS&E to develop, have developed, procure and/or market products or services now or in the future, including any which may be competitive with those that are the subject of this Agreement.  Neither party shall be required to disclose planning information to the other.

16.                     EXPORT

16.1.             Export.  AS&E shall be responsible for obtaining and maintaining any export license(s) required for delivery of any Products by AS&E outside the United States.  To the extent previously received by Accuray, Accuray agrees to provide AS&E with the Product’s most current technology classification as determined by the U.S. Department of Commerce - Export Administration Regulations (EAR) or, if applicable the U.S. Department of State - International Traffic in Arms Regulations (ITAR).

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17.                     INSURANCE

17.1.             Insurance Requirements.  Each party warrants that it is covered by liability insurance adequately covering its liabilities under this Agreement.  Upon reasonable written request, a party shall provide the other party with evidence of such insurance.  If in the performance of this Agreement, either party is required to work in and/or enter premises occupied by or under the control of the other party or a third party contractor of the other party, or to use or operate property furnished by the other party, such other party shall procure and maintain during the entire performance period of this Agreement, premises liability, public liability, property damage and worker’s compensation insurance in prudent, reasonable, and/or statutory amounts.

18.                     SECURITY SYSTEMS MARKET

18.1.             License to Use Purchased IP for Security Systems Applications.  Pursuant to Section 2.1 of the License Agreement, Accuray granted AS&E an irrevocable, exclusive (even as to Accuray), worldwide, fully paid license of the Intellectual Property (as defined in the Asset Purchase Agreement) solely for use in connection with the design, development, marketing, manufacturing, sales and service of products intended for use in the Homeland Security Market and the Non-Destructive Testing Market (“Security Systems License”).

18.2.             Traveling Wave Linear Accelerator Project.  Following the Asset Purchase, Accuray developed the Traveling Wave IP for use in connection with medical, commercial and industrial markets including, but not limited to, medical, Homeland Security and Non-Destructive Testing Markets.  AS&E does hereby acknowledge and agree that none of the design, development, marketing, manufacturing, sales or other activities in relation to Traveling Wave IP by Accuray were in breach or contravention of the License Agreement granted to AS&E.  AS&E acknowledges and agrees that Accuray may continue its development, manufacturing sale or offering for sale to third parties of products incorporating the Traveling Wave IP by Accuray for use in the Homeland Security Market or Non-Destructive Testing Market.

18.3.             General Release.  In consideration of the provisions set forth herein, the receipt and sufficiency of which are hereby acknowledged, each of AS&E and Accuray, for themselves, their respective predecessors, successors, assigns, agents and representatives, as well as each entity that such party has the power to bind (by such party’s acts or signature) or over which such party directly or indirectly exercises control (each party a “Releasor” and, collectively “Releasors”), hereby forever releases, discharges, acquits and forgives the other party, its officers, directors, shareholders, employees, agents, affiliates, successors and assigns (each party a “Releasee” and, collectively, “Releasees”), from all, and all manner of, claims, demands, causes of action, obligations, damages, attorneys’ fees, costs and liabilities of any nature, at law or in equity, whether or not now known, suspected or asserted, which such Releasor ever had, now has, or may claim to have, or which such Releasor’s successors or assigns can, shall or may have, for or by reason of the License Agreement, the Accuray IP, and the Security Systems License, from the beginning of time until the date of execution of this Agreement.

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AS&E hereby expressly waives the benefits of and any and all rights under Section 1542 of the Civil Code of California, which reads as follows:

“A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”

19.                     PUBLICATION

19.1.             Publication.  Neither party shall disclose the terms of this Agreement to any third party, (with the exception of that party’s outside legal counsel, accountants, or auditors) or the nature of the relationship of the parties with respect to the terms of this Agreement, without first obtaining the written consent (which consent shall not be unreasonably withheld) of the other party, except as may be required by applicable law, regulation or stock exchange requirement.

20.                     GENERAL

20.1.             Force Majeure.  Neither party shall be deemed to be in default of this Agreement if prevented from performing any obligation hereunder for any reason beyond its reasonable control including, without limitation, governmental laws and regulations, terrorists acts, acts of God or the public, calamities, floods, and storms.

20.2.             Disputes.  Should any difference, dispute, claim or controversy (“Dispute”) arise under this Agreement between the parties which cannot be resolved by discussions, the parties shall attempt, in good faith, to negotiate a mutually agreeable resolution within sixty (60) days after the Dispute arises.  Should any Dispute not be resolved by the parties within such sixty (60) day period, the chief executive officers (or any other duly authorized representative) of both parties shall attempt to amicably resolve the Dispute over a further thirty (30) day period.  Should the Dispute remain unresolved by the chief executive officers or authorized representatives of the parties following such further thirty (30) day period, then the Dispute will be settled in any federal or state court of competent jurisdiction in the State of California.

20.2.1.            Subject to Section 20.2 above in the case of a Dispute other than a Dispute arising under Section 7.3 or Section 19 hereof or under the License Agreement, nothing herein shall be construed to restrict either party from seeking injunctive relief or other equitable relief in a court of competent jurisdiction.

20.3.             Governing Law.  The validity of this Agreement, the construction and enforcement of its terms, and the interpretation of the rights and duties of the parties shall be governed by the laws of the State of California, without regard to its conflict of laws rules and shall bind the parties, their successors and permitted assigns.  The parties agree that the United States federal or state courts located in California shall have jurisdiction.

20.4.             Damages.  NEITHER PARTY SHALL BE LIABLE TO THE OTHER OR TO ANY THIRD PARTY FOR ANY CONSEQUENTIAL, SPECIAL, INCIDENTAL OR

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INDIRECT DAMAGES WITH RESPECT TO THIS AGREEMENT.  IN NO EVENT SHALL EITHER PARTY’S CUMULATIVE LIABILITY UNDER OR IN ANY WAY RELATED TO THIS AGREEMENT, OTHER THAN SECTION 13.2 HEREOF, RESULTING FROM ANY COURSE OF ACTION, WHETHER IN CONTRACT, TORT, STRICT LIABILITY OR ANY OTHER LEGAL THEORY, EXCEED THE TOTAL AMOUNT OF PAYMENTS MADE OR RECEIVED HEREUNDER.THE PARTIES AGREE THAT THE SOLE REMEDY FOR BREACH HEREUNDER, WHETHER IN LAW OR EQUITY, SHALL BE LIMITED TO THOSE SET FORTH IN THIS AGREEMENT.

20.5.             Assignment.  Subject to Section 7.3 above, neither party may assign this Agreement without the other party’s prior written consent, which consent shall not be unreasonably withheld.  Any attempted assignment or transfer of any of the rights, duties or obligations contained in this Agreement without the prior written consent of the other party shall be void.  If consent is given, this Agreement shall be binding upon and inure to the benefit of the assigns.  Subject to the foregoing, this Agreement will bind and inure to the benefit of the parties’ permitted successors and assigns.

20.6.             Survival.  Sections 7 (Intellectual Property and Joint Research and Development), 8 (Termination), 9 (Warranties), 10 (Service, Training and Spare Parts), 11 (Product Returns), 13 (Indemnification), 15 (Competition), 16 (Export), 18 (Security Systems Market), 19 (Publications) and 20 (General) will survive the termination of this Agreement in accordance with their terms or, if no term is specified, indefinitely.

20.7.             Severability.  If any provision of this Agreement is held invalid or unenforceable by a court of competent jurisdiction, the remaining provisions of the Agreement will remain in full force and effect, and the provision affected will be construed so as to be enforceable to the maximum extent permissible by law.

20.8.             Notices.  All notices required or permitted under this Agreement will be in writing and delivered by confirmed facsimile transmission, by courier or overnight delivery service, or by certified mail, and in each instance will be deemed given upon receipt.  All notices will be sent to the addresses set forth below or to such other address as may be specified by either party to the other in accordance with this Section.

20.9.             Entire Agreement.  This Agreement constitutes the complete and exclusive understanding and agreement of the parties with respect to the subject matter hereof and supersedes all prior understandings and agreements, whether written or oral, with respect to the subject

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matter hereof.  Any waiver, modification or amendment of any provision of this Agreement will be effective only if in writing and signed by authorized representatives of the parties.

20.10.       Waiver.  Any waiver of a breach or any failure to enforce any provision of this Agreement will not constitute a waiver of any subsequent breach of such provision, any other provision of this Agreement or the rights of a party pursuant to this Agreement.

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

20.12.       Termination of Prior Agreement.  Accuray and AS&E are parties to a Basic Purchase Agreement effective January 10, 2005 for the sale by Accuray of certain linear accelerator products to AS&E (“Prior Agreement”).  The parties are entering into this Agreement for the sale of Products by Accuray to AS&E; therefore, upon the execution of this Agreement by the parties and as of the effective date of this Agreement, the Prior Agreement, and all of its terms and conditions, shall automatically terminate and the terms and conditions of this Agreement shall govern the respective rights and obligations of the parties.  The parties agree that as of the effective date of this Agreement the terms of this Agreement shall supersede the terms of the Prior Agreement in their entirety.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the parties have signed this Agreement as of the last date set forth below.

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EXHIBIT A

PRODUCTS AND PRICING

6MEV Standing Wave Linac System:

3 MEV Standing Wave Linac System:

Traveling Wave LINAC System Pricing:

1. Preliminary Pricing. Accuray agrees to provide discounted pricing to AS&E for traveling wave LINAC products (“Traveling Wave Products”) sold by Accuray to its commercial customers in the Homeland Security market.   Discounted pricing shall be established on a product by product basis prior to Accuray’s first commercial delivery in the Homeland Security market, but, thereafter, shall be subject to adjustment in accordance with this provision. AS&E and Accuray agree to meet annually to review product development and agree (i) pricing, (ii) volume thresholds and (iii) product definitions for Traveling Wave Products sold to AS&E.  The first meeting shall take place within one (1) month following the Effective Date with subsequent meetings to occur annually thereafter during the Term of this Agreement on the anniversary of the initial meeting date, unless otherwise agreed between the parties.  Subject to the annual review of the parties, pricing for Traveling Wave Products shall be:

2. Administration of Adjusted Pricing. Notwithstanding the foregoing, on the date (“Adjustment Date”) that Accuray delivers any Traveling Wave Product to a Commercial Customer in the Homeland Security market at a price that is lower than the then applicable purchase price available to AS&E in accordance with the volume thresholds and product definitions agreed between the parties, then, (i) AS&E shall be entitled to receive adjusted pricing as provided in subsections (a) or (b) above, as applicable (“Adjusted Pricing”), and (ii) in the event Accuray delivers Traveling Wave Products to AS&E after the Adjustment Date but invoices AS&E for such products without application of the Adjusted Pricing as required above (“Legacy Priced Products”), AS&E shall be credited the amount of the difference in the per unit price invoiced by Accuray and the applicable per unit Adjusted Pricing that should apply (“Price Credit”) for each of the Legacy Priced Products.  Price Credits shall be applied to (y) future invoices for Traveling Wave Products delivered to AS&E on a one Price Credit per unit invoiced basis or, if AS&E does not purchase additional Traveling Wave Products, (z) to future invoices for Spare Parts delivered to AS&E on a dollar for dollar basis.

[*] Certain information on this page has been redacted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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3.  Development Products.  The parties agree that any sale by Accuray to a customer in the Homeland Security Market of development units of Traveling Wave Products provided for engineering and/or evaluation purposes and not for commercial use shall not be considered a sale to a Commercial Customer for the purposes of Sections 1 and 2 above.

4.  Audit. AS&E shall be permitted to audit the application of such Price Credits to its purchases in accordance with the audit process provided in Section 2.5 of the Agreement to ensure compliance with this provision.  If the results of the Audit demonstrate that Accuray has not appropriately applied Price Credits to AS&E’s purchases of Traveling Wave Products and/or Spare Parts hereunder, Accuray shall be responsible for the cost of the Audit.

[INTENTIONALLY LEFT BLANK]

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EXHIBIT B

LONG LEAD-TIME PARTS

The following list of Long Lead-Time Parts is subject to change from time to time as notified to AS&E in writing as a result of Product modifications, availability of parts, vendor substitutions and similar restrictions.

[INTENTIONALLY LEFT BLANK]

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EXHIBIT C

ACCEPTANCE TEST PROCEDURES

1.  Work Instruction 026619 for Industrial 6 MeV Linear Accelerator Extended Guide

2.  Work Instruction 028519 for WI Test X-ray Head AS&E 6 MeV Extended Guide

3.  Work Instruction 027339 for WI Test X-ray Head AS&E 3.5 MeV

4.  Work Instruction 023745 for Industrial 3.5 MeV Linear Accelerator

[INTENTIONALLY LEFT BLANK]

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Industrial 6MeV Linear Accelerator Extended Guide Final System Test Procedure

System Serial Number

WI 026619

Rev A

Accuray Confidential

Copyright Ó 2010 Accuray Incorporated

APPROVAL

Revision History

1.0          PURPOSE/SCOPE

This document defines the tests and measurements for Final Factory Test of the 6 MeV Extended Guide Industrial Linear Accelerator X-ray System.

Additionally, this document describes standard test procedures commonly used for purposes of characterizing the Industrial Linear Accelerator X-ray System.

All operating characteristics identified in the course of implementing these procedures are recorded for the purpose of establishing baseline information on the equipment, i.e. the actual operating conditions at the time of acceptance.

2.0                               RESPONSIBILITY

Test Engineering is responsible for the maintenance of this test document

3.0          ASSOCIATED MATERIALS & EQUIPMENT

3.1         Reference Documents

The latest revisions of the following documents shall apply.

·                  Equipment specifications for the 6 MeV Extended Guide High Energy Industrial Linear Accelerator.

·                  Workmanship Requirements for electronic systems.

3.2         Data

All data shall be recorded on reproducible copies of the test data sheets.  A clear copy of all acceptance test data shall be supplied with each system. The original is to be filed in the Device History Record.

3.3         Test Conditions

3.3.1 Input Power customer specific.

3.3.2 Ambient Temperature 40 to 90°F

3.4 Test Equipment

All instrumentation used shall be in calibration and of sufficient accuracy to perform the required measurements. Test equipment/ aids/ fixtures used during the performance of tests are recorded in section 6 of test procedure.

4.0          TEST EQUIPMENT LIST

The following is a list of recommended test equipment to be used for performance of these tests.  If the recommended instrument is not available, a suitable alternate of similar range and accuracy may be used.

A     Oscilloscope Tektronics TDS 220 OR TDS720A

B     Digital V.O.M. Fluke Model 79

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C     Water Flow Gauge.

D     High Voltage Probe (Oscilloscope) Tektronics P6015

E      H.V. Probe, D.C.

F                 Electometer “Unidos E”, 0.6cc “peanut” with 6 Mev build-up cap.

G     Steel Plates (Half value layer checks).

H     Laminar Camera, Mylar .007, steel .014

5.0               PROCEDURE

5.1           System Test

Section 7 of this document provides a step-by-step procedure for complete final factory test of the 6 MeV Extended Guide Industrial Linear Accelerator X-ray System.  It is assumed that complete system checks out, debug and calibration has been accomplished prior to the start of this test.

Although the test steps have been placed in logical sequence, it is not a requirement of this test to perform the test steps in that order.

All data must be entered in ink.  No erasures or “white-outs” are allowed. No writeovers are to be used when correcting errors. Entries may be lined out, initialed, and new data entered with appropriate explanation on the same page.

5.2           Option List

The options included with each deliverable system shall be noted in the space provided in the Data Record. If no options provided write “NONE”.

5.3           Acceptance

Upon completion of this data package, the appropriate staff should review the results for accuracy, completeness and compliance with specifications. (see page 21) The appropriate signatures and dates in Part 9.0 will indicate acceptance.

5.4           Disposition

Original – Device History Record

1 Copy  - with Tested Unit

4

6              Test Equipment Calibration

5

6

7

8

9

10