Exhibit 10.13

LOAN AND SECURITY AGREEMENT

THIS LOAN AND SECURITY AGREEMENT (this “Agreement”) dated as of March 25, 2019
(the “Effective Date”) among (a) SILICON VALLEY BANK, a California corporation
(“SVB” or “Bank”), in its capacity as administrative agent and collateral agent
(“Agent”), (b) SILICON VALLEY BANK, a California corporation, as a lender, (c)
WESTRIVER INNOVATION LENDING FUND VIII, L.P., a Delaware limited partnership
(“WestRiver”), as a lender (SVB and WestRiver and each of the other “Lenders”
from time to time a party hereto are referred to herein collectively as the
“Lenders” and each individually as a “Lender”), and (d) PHASEBIO
PHARMACEUTICALS, INC., a Delaware corporation (“Borrower”), provides the terms
on which Agent and the Lenders shall lend to Borrower and Borrower shall repay
Agent and the Lenders.  The parties agree as follows:

1ACCOUNTING AND OTHER TERMS

Accounting terms not defined in this Agreement shall be construed following
GAAP.  Calculations and determinations must be made following GAAP.  Capitalized
terms not otherwise defined in this Agreement shall have the meanings set forth
in Section 14 of this Agreement.  All other terms contained in this Agreement,
unless otherwise indicated, shall have the meaning provided by the Code to the
extent such terms are defined therein.

2LOAN AND TERMS OF PAYMENT

2.1Promise to Pay.  Borrower hereby unconditionally promises to pay to Agent,
for the ratable benefit of each Lender, the outstanding principal amount of all
Credit Extensions advanced to Borrower by such Lender and accrued and unpaid
interest thereon, together with any fees as and when due in accordance with this
Agreement.

2.1.1Growth Capital Advances

(a)Availability.  Subject to the terms and conditions of this Agreement, the
Lenders, severally and not jointly, agree to make growth capital advances to
Borrower from time to time in three (3) tranches: “Tranche A”, “Tranche B” and
“Tranche C”.  On the Effective Date, or as soon thereafter as all conditions
precedent to the making thereof have been met, the Lenders shall make one (1)
growth capital advance under Tranche A to Borrower, in an amount equal to Seven
Million Five Hundred Thousand Dollars ($7,500,000) (the “Tranche A Growth
Capital Advance”) according to each Lender’s Tranche A Loan Advance Commitment
as set forth on Schedule 1.1 attached hereto, which shall be used to refinance
all obligations owing from Borrower to Bank under the SVB Loan Agreement, and
for working capital purposes.  During the Tranche B Draw Period, Borrower may
request and the Lenders shall make one (1) growth capital advance under Tranche
B to Borrower, in an amount equal to Two Million Five Hundred Thousand Dollars
($2,500,000) (the “Tranche B Growth Capital Advance”) according to each Lender’s
Tranche B Loan Advance Commitment as set forth on Schedule 1.1 attached
hereto.  If Borrower achieves the Tranche C Milestone on or prior to December
31, 2019, Borrower shall, on or prior to the date that is ten (10) days after
Borrower achieves the Tranche C Milestone, request and, provided no Event of
Default has occurred and is continuing hereunder, the Lenders shall make one (1)
growth capital advance under Tranche C to Borrower, in an amount equal to Five
Million Dollars ($5,000,000) (the “Tranche C Growth Capital Advance”, and
together with the Tranche A Growth Capital Advance and the Tranche B Growth
Capital Advance, each a “Growth Capital Advance” and collectively, the “Growth
Capital Advances”) according to each Lender’s Tranche C Loan Advance Commitment
as set forth on Schedule 1.1 attached hereto.  The aggregate outstanding amount
of the Growth Capital Advances shall not, at any time, exceed the Growth Capital
Line.  After repayment, no Growth Capital Advance (or any portion thereof) may
be reborrowed.

(b)Interest Period.  Commencing on the first (1st) Payment Date of the month
following the month in which the Funding Date of the applicable Growth Capital
Advance occurs, and continuing on the Payment Date of each month thereafter,
Borrower shall make monthly payments of interest to Agent, for the account of
the Lenders, in arrears, on the principal amount of each Growth Capital Advance,
at the rate set forth in Section 2.2(a).

 

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(c)Repayment.  Commencing on the Amortization Start Date, and continuing on each
Payment Date thereafter, Borrower shall repay the aggregate outstanding Growth
Capital Advances to Agent, for the account of the Lenders, in (i) consecutive
equal monthly installments of principal based on the Repayment Schedule, plus
(ii) monthly payments of accrued interest at the rate set forth in Section
2.2(a).  All outstanding principal and accrued and unpaid interest with respect
to the Growth Capital Advances, and all other outstanding Obligations under the
Growth Capital Advances, are due and payable in full on the Growth Capital
Maturity Date.

(d)Permitted Prepayment.  Borrower shall have the option to prepay all, but not
less than all, of any Growth Capital Advances advanced by the Lenders under this
Agreement, provided Borrower (i) provides written notice to Agent of its
election to prepay such Growth Capital Advance at least ten (10) days prior to
such prepayment, and (ii) pays to Agent, for the account of the Lenders in
accordance with their respective Pro Rata Share, on the date of such prepayment
(A) all outstanding principal plus accrued and unpaid interest in connection
with the Growth Capital Advance being prepaid, (B) the applicable portion of the
Prepayment Premium due in connection with the Growth Capital Advance being
prepaid, (C) the applicable portion of the Final Payment due in connection with
the Growth Capital Advance being prepaid, and (D) all other sums, if any, that
shall have become due and payable, in connection with the Growth Capital Advance
being prepaid, including Lenders’ Expenses and interest at the Default Rate with
respect to any past due amounts.

(e)Mandatory Prepayment Upon an Acceleration.  If the Growth Capital Advances
are accelerated by Agent pursuant to Section 9.1 hereof, following the
occurrence of an Event of Default, Borrower shall immediately pay to Agent, for
the account of the Lenders in accordance with its respective Pro Rata Share, an
amount equal to the sum of (i) all outstanding principal plus accrued and unpaid
interest with respect to the Growth Capital Advances, (ii) the Prepayment
Premium, (iii) the Final Payment and (iv) all other sums, if any, that shall
have become due and payable, including Lenders’ Expenses and interest at the
Default Rate with respect to any past due amounts.

2.2Payment of Interest on the Credit Extensions.

(a)Interest Rate.  Subject to Section 2.2(b), the principal amount outstanding
under each Growth Capital Advance shall accrue interest at a floating per annum
rate equal to the greater of (i) six and one-half of one percent (6.50%) and
(ii) one percent (1.00%) above the Prime Rate, which interest, in each case,
shall be payable monthly in accordance with Section 2.2(d) below.

(b)Default Rate.  Immediately upon the occurrence and during the continuance of
an Event of Default, Obligations shall bear interest at a rate per annum which
is five percent (5.0%) above the rate that is otherwise applicable thereto (the
“Default Rate”).  Fees and expenses which are required to be paid by Borrower
pursuant to the Loan Documents (including, without limitation, Lenders’
Expenses) but are not paid when due shall bear interest until paid at a rate
equal to the highest rate applicable to the Obligations.  Payment or acceptance
of the increased interest rate provided in this Section 2.2(b) is not a
permitted alternative to timely payment and shall not constitute a waiver of any
Event of Default or otherwise prejudice or limit any rights or remedies of Agent
or any Lender.

(c)Adjustment to Interest Rate.  Changes to the interest rate of any Credit
Extension based on changes to the Prime Rate shall be effective on the effective
date of any change to the Prime Rate and to the extent of any such change.

(d)Payment; Interest Computation.  Interest is payable monthly on the Payment
Date and shall be computed on the basis of a 360-day year for the actual number
of days elapsed.  In computing interest, (i) all payments received after 12:00
p.m. Eastern time on any day shall be deemed received at the opening of business
on the next Business Day, and (ii) the date of the making of any Credit
Extension shall be included and the date of payment shall be excluded; provided,
however, that if any Credit Extension is repaid on the same day on which it is
made, such day shall be included in computing interest on such Credit Extension.

2.3Fees and Expenses.  Borrower shall pay to Agent:  

(a)Final Payment.  The Final Payment, when due hereunder, to be shared between
the Lenders pursuant to their respective Growth Capital Loan Commitment
Percentages;

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(b)Prepayment Premium.  The Prepayment Premium, when due hereunder, to be shared
between the Lenders pursuant to their respective Growth Capital Loan Commitment
Percentages; provided that the Lenders shall waive the Prepayment Premium if
Borrower refinances the Growth Capital Advances with any Lender;

(c)Lenders’ Expenses.  All Lenders’ Expenses (including reasonable attorneys’
fees and expenses for documentation and negotiation of this Agreement) incurred
through and after the Effective Date, when due (or, if no stated due date, upon
demand by Agent).

Unless otherwise provided in this Agreement or in a separate writing by Agent,
Borrower shall not be entitled to any credit, rebate, or repayment of any fees
earned by Agent or any Lender pursuant to this Agreement notwithstanding any
termination of this Agreement or the suspension or termination of any Lender’s
obligation to make loans and advances hereunder.  Agent may deduct amounts owing
by Borrower under the clauses of this Section 2.2 pursuant to the terms of
Section 2.4(e).  Agent shall provide Borrower written notice of deductions made
from the Designated Deposit Account pursuant to the terms of the clauses of this
Section 2.3.

2.4Payments; Pro Rata Treatment; Application of Payments; Debit of Accounts.  

(a)All payments (including prepayments) to be made by Borrower under any Loan
Document shall be made to Agent for the account of Lenders, in immediately
available funds in Dollars, without setoff or counterclaim, before 12:00 p.m.
Eastern time on the date when due.   Agent shall distribute such payments to
Lenders in like funds as set forth in Section 2.5.  Payments of principal and/or
interest received after 12:00 p.m. Eastern time are considered received at the
opening of business on the next Business Day. When a payment is due on a day
that is not a Business Day, the payment shall be due the next Business Day, and
additional fees or interest, as applicable, shall continue to accrue until paid.

(b)Each borrowing by Borrower from Lenders hereunder shall be made according to
the respective Growth Capital Loan Commitment Percentages of the relevant
Lenders.

(c)Except as otherwise provided herein, each payment (including each prepayment)
by Borrower on account of principal or interest on the Growth Capital Advances
shall be applied according to each Lender’s Pro Rata Share of the outstanding
principal amount of the Growth Capital Advances.  The amount of each principal
prepayment of the Growth Capital Advances shall be applied to reduce the then
remaining installments of the Growth Capital Advances based upon each Pro Rata
Share of Growth Capital Advances.

(d)Agent has the exclusive right to determine the order and manner in which all
payments with respect to the Obligations may be applied.  Borrower shall have no
right to specify the order or the accounts to which Agent shall allocate or
apply any payments required to be made by Borrower to Agent or otherwise
received by Agent or any Lender under this Agreement when any such allocation or
application is not specified elsewhere in this Agreement.

(e)Agent may debit any of Borrower’s deposit accounts, including the Designated
Deposit Account, for principal and interest payments or any other amounts
Borrower owes Agent or any Lender when due. These debits shall not constitute a
set-off.

(f)Unless Agent shall have been notified in writing by Borrower prior to the
date of any payment due to be made by Borrower hereunder that Borrower will not
make such payment to Agent, Agent may assume that Borrower is making such
payment, and Agent may, but shall not be required to, in reliance upon such
assumption, make available to Lenders their respective Pro Rata Share of a
corresponding payment amount.  If such payment is not made to Agent by Borrower
within three (3) Business Days after such due date, Agent shall be entitled to
recover, on demand, from each Lender to which any amount which was made
available pursuant to the preceding sentence, such amount with interest thereon
at the rate per annum equal to the daily average Federal Funds Effective
Rate.  Nothing herein shall be deemed to limit the rights of Agent or any Lender
against Borrower.

2.5Settlement Procedures.  If Agent receives any payment for the account of
Lenders on or prior to 12:00 p.m. (Eastern time) on any Business Day, Agent
shall pay to each applicable Lender such Lender’s Pro Rata

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Share of such payment on such Business Day. If Agent receives any payment for
the account of Lenders after 12:00 p.m. (Eastern time) on any Business Day,
Agent shall pay to each applicable Lender such Lender’s Pro Rata Share of such
payment on the next Business Day.  

2.6Withholding.  Payments received by Agent from Borrower under this Agreement
will be made free and clear of and without deduction for any and all present or
future taxes, levies, imposts, duties, deductions, withholdings, assessments,
fees or other charges imposed by any Governmental Authority (including any
interest, additions to tax or penalties applicable thereto).  Specifically,
however, if at any time any Governmental Authority, applicable law, regulation
or international agreement requires Borrower to make any withholding or
deduction from any such payment or other sum payable hereunder to Agent,
Borrower hereby covenants and agrees that the amount due from Borrower with
respect to such payment or other sum payable hereunder will be increased to the
extent necessary to ensure that, after the making of such required withholding
or deduction, Agent receives a net sum equal to the sum which it would have
received had no withholding or deduction been required, and Borrower shall pay
the full amount withheld or deducted to the relevant Governmental
Authority.  Borrower will, upon request, furnish Agent with proof reasonably
satisfactory to Agent indicating that Borrower has made such withholding
payment; provided, however, that Borrower need not make any withholding payment
if the amount or validity of such withholding payment is contested in good faith
by appropriate and timely proceedings and as to which payment in full is bonded
or reserved against by Borrower.  The agreements and obligations of Borrower
contained in this Section 2.6 shall survive the termination of this Agreement.

3CONDITIONS OF LOANS

3.1Conditions Precedent to Initial Credit Extension.  Each Lender’s obligation
to make the initial Credit Extension hereunder is subject to the condition
precedent that Agent shall have received, in form and substance satisfactory to
Agent and the Lenders, such documents, and completion of such other matters, as
Agent may reasonably deem necessary or appropriate, including, without
limitation:

(a)duly executed original signatures to the Loan Documents;

(b)duly executed original signatures to a Warrant to Purchase Common Stock
issued by Borrower in favor of Bank;

(c)duly executed original signatures to a Warrant to Purchase Common Stock
issued by Borrower in favor of WestRiver;

(d)the Operating Documents and long-form good standing certificates of Borrower
certified by the Secretary of State of the State of Delaware each other
jurisdiction in which Borrower is qualified to conduct business, each dated as
of a date no earlier than thirty (30) days prior to the Effective Date;

(e)duly executed signatures to the completed Borrowing Resolutions for Borrower;

(f)certified copies, dated as of a recent date, of Lien searches (including
without limitation, UCC searches), as Agent may request, accompanied by written
evidence (including any UCC termination statements and other Lien releases) that
the Liens indicated in any such financing statements or other filings either
constitute Permitted Liens or have been or, in connection with the initial
Credit Extension hereunder, will be terminated or released;

(g)the Perfection Certificate of Borrower, together with the duly executed
signatures thereto;

(h)a payoff letter from SVB with respect to all amounts owing from Borrower to
Bank under the SVB Loan Agreement;

(i)with respect to the Tranche B Growth Capital Advance only, an additional
Warrant to Purchase Common Stock issued by Borrower in favor of each of (A) Bank
and (B) WestRiver, in the form attached hereto as Annex I;

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(j)with respect to the Tranche C Growth Capital Advance only, an additional
Warrant to Purchase Common Stock issued by Borrower in favor of each of (A) Bank
and (B) WestRiver, in substantially the form attached hereto as Annex I; and

(k)payment of the fees and Lenders’ Expenses then due as specified in Section
2.3 hereof.

3.2Conditions Precedent to all Credit Extensions.  Each Lender’s obligation to
make each Credit Extension, including the initial Credit Extension, is subject
to the following conditions precedent:

(a)timely receipt by the Lenders of (i) an executed Disbursement Letter and (ii)
an executed Payment/Advance Form;  

(b)the representations and warranties in this Agreement shall be true, accurate,
and complete in all material respects on the date of the Disbursement Letter
(and the Payment/Advance Form) and on the Funding Date of each Credit Extension;
provided, however, that such materiality qualifier shall not be applicable to
any representations and warranties that already are qualified or modified by
materiality in the text thereof; and provided, further that those
representations and warranties expressly referring to a specific date shall be
true, accurate and complete in all material respects as of such date, and no
Event of Default shall have occurred and be continuing or result from the Credit
Extension.  Each Credit Extension is Borrower’s representation and warranty on
that date that the representations and warranties in this Agreement remain true,
accurate, and complete in all material respects; provided, however, that such
materiality qualifier shall not be applicable to any representations and
warranties that already are qualified or modified by materiality in the text
thereof; and provided, further that those representations and warranties
expressly referring to a specific date shall be true, accurate and complete in
all material respects as of such date; and

(c)Agent and each Lender determine to its satisfaction that there has not been a
Material Adverse Change.

3.3Covenant to Deliver. Borrower agrees to deliver to Agent and each Lender each
item required to be delivered to Agent and each Lender under this Agreement as a
condition precedent to any Credit Extension.  Borrower expressly agrees that a
Credit Extension made prior to the receipt by Agent and each Lender of any such
item shall not constitute a waiver by Agent or Lenders of Borrower’s obligation
to deliver such item, and the making of any Credit Extension in the absence of a
required item shall be in each Lender’s sole discretion.

3.4Procedures for Borrowing.  

(a)Growth Capital Advances.  Subject to the prior satisfaction of all other
applicable conditions to the making of a Credit Extension set forth in this
Agreement, to obtain a Credit Extension, Borrower shall notify Agent (which
notice shall be irrevocable) by electronic mail, facsimile, or telephone by
12:00 p.m. Eastern time at least five (5) Business Days before the proposed
Funding Date of such Credit Extension.  Together with any such electronic or
facsimile notification, Borrower shall deliver to Agent by electronic mail or
facsimile a completed Disbursement Letter (and Payment/Advance Form) executed by
an Authorized Signer.  Agent may rely on any telephone notice given by a person
whom Agent believes is an Authorized Signer.  On the Funding Date, Agent shall
credit the Credit Extensions to the Designated Deposit Account.  Agent may make
Credit Extensions under this Agreement based on instructions from an Authorized
Signer or without instructions if the Credit Extensions are necessary to meet
Obligations which have become due

(b)Funding.  In determining compliance with any condition hereunder to the
making of a Credit Extension that, by its terms, must be fulfilled to the
satisfaction of a Lender, Agent may presume that such condition is satisfactory
to such Lender unless Agent shall have received notice to the contrary from such
Lender prior to the making of such Credit Extension.  Unless Agent shall have
been notified in writing by any Lender prior to the date of any Credit
Extension, that such Lender will not make the amount that would constitute its
share of such borrowing available to Agent, Agent may assume that such Lender is
making such amount available to Agent, and Agent may, in reliance upon such
assumption, make available to Borrower a corresponding amount.  If such amount
is not made available to Agent by the required time on the Funding Date
therefor, such Lender shall pay to Agent, on

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demand, such amount with interest thereon, at a rate equal to the greater of (i)
the Federal Funds Effective Rate or (ii) a rate determined by Agent in
accordance with banking industry rules on interbank compensation, for the period
until such Lender makes such amount immediately available to Agent.  If such
Lender’s share of such Credit Extension is not made available to Agent by such
Lender within three (3) Business Days after such Funding Date, Agent shall also
be entitled to recover such amount with interest thereon at the rate per annum
applicable to the Growth Capital Advances, on demand, from Borrower.

4CREATION OF SECURITY INTEREST

4.1Grant of Security Interest.  Borrower hereby grants Agent, for the ratable
benefit of the Lenders, to secure the payment and performance in full of all of
the Obligations, a continuing security interest in, and pledges to Agent, for
the ratable benefit of the Lenders, the Collateral, wherever located, whether
now owned or hereafter acquired or arising, and all proceeds and products
thereof.  For clarity, any reference to “Agent’s Lien” or any granting of
collateral to Agent in this Agreement or any Loan Document means the Lien
granted to Agent for the ratable benefit of the Lenders.

Borrower acknowledges that it previously has entered, and/or may in the future
enter, into Bank Services Agreements with SVB. Regardless of the terms of any
Bank Services Agreement, Borrower agrees that any amounts Borrower owes SVB
thereunder shall be deemed to be Obligations hereunder and that it is the intent
of Borrower and SVB to have all such Obligations secured by the first priority
perfected security interest in the Collateral granted herein (subject only to
Permitted Liens that are permitted pursuant to the terms of this Agreement to
have superior priority to Agent’s Lien in this Agreement), and by any and all
other security agreements, mortgages or other collateral granted to Agent by
Borrower as security for the Obligations, now or in the future.

If this Agreement is terminated, Agent’s Lien in the Collateral shall continue
until the Obligations (other than inchoate indemnity obligations) are repaid in
full in cash.  Upon payment in full in cash of the Obligations (other than
inchoate indemnity obligations) and at such time as the Lenders’ obligation to
make Credit Extensions has terminated, Agent shall, at the sole cost and expense
of Borrower, release its Liens in the Collateral and all rights therein shall
revert to Borrower.  In the event (x) all Obligations (other than inchoate
indemnity obligations), except for Bank Services, are satisfied in full, and (y)
this Agreement is terminated, Agent shall terminate the security interest
granted herein upon Borrower providing to SVB cash collateral acceptable to SVB
in its good faith business judgment for Bank Services, if any. In the event such
Bank Services consist of outstanding Letters of Credit, Borrower shall provide
to SVB cash collateral in an amount equal to (x) if such Letters of Credit are
denominated in Dollars, then at least one hundred five percent (105.0%); and (y)
if such Letters of Credit are denominated in a Foreign Currency, then  at least
one hundred ten percent (110.0%), of the Dollar Equivalent of the face amount of
all such Letters of Credit plus, in each case, all interest, fees, and costs due
or to become due in connection therewith (as estimated by SVB in its business
judgment), to secure all of the Obligations relating to such Letters of Credit.

4.2Priority of Security Interest.  Borrower represents, warrants, and covenants
that the security interests granted herein are and shall at all times continue
to be first priority perfected security interests in the Collateral (subject
only to Permitted Liens that are permitted pursuant to the terms of this
Agreement to have superior priority to Agent’s Lien under this Agreement).  If
Borrower shall acquire a commercial tort claim, Borrower shall promptly notify
Agent in a writing signed by Borrower of the general details thereof and grant
to Agent, for the ratable benefit of the Lenders, in such writing a security
interest therein and in the proceeds thereof, all upon the terms of this
Agreement, with such writing to be in form and substance reasonably satisfactory
to Agent.

4.3Authorization to File Financing Statements.  Borrower hereby authorizes
Agent, on behalf of the Lenders, to file financing statements and other similar
forms, without notice to Borrower, with all appropriate jurisdictions to perfect
or protect Agent’s and Lenders’ interest or rights hereunder, including a notice
that any disposition of the Collateral, by either Borrower or any other Person,
shall be deemed to violate the rights of Agent under the Code.  

5REPRESENTATIONS AND WARRANTIES

Borrower represents and warrants as follows:

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5.1Due Organization, Authorization; Power and Authority.  Borrower is duly
organized, validly existing, and in good standing as a Registered Organization
in its jurisdiction of formation and is qualified and licensed to do business
and is in good standing in any other jurisdiction in which the conduct of its
business or its ownership of property and other assets or business which it is
engaged in requires that it be qualified except where the failure to do so could
not reasonably be expected to have a material adverse effect on Borrower’s
business. In connection with this Agreement, Borrower has delivered to Agent and
each Lender a completed certificate signed by Borrower, entitled “Perfection
Certificate” (collectively, the “Perfection Certificate”).  Borrower represents
and warrants to Agent and each Lender that: (a) Borrower’s exact legal name is
that indicated on the Perfection Certificate and on the signature page hereof;
(b) Borrower is an organization of the type and is organized or in incorporated
in the jurisdiction set forth in the Perfection Certificate; (c) the Perfection
Certificate accurately sets forth Borrower’s organizational identification
number or accurately states that Borrower has none; (d) the Perfection
Certificate accurately sets forth Borrower’s place of business, or, if more than
one, its chief executive office as well as such Borrower’s mailing address (if
different than its chief executive office); (e) except as indicated on the
Perfection Certificate, Borrower (and each of its predecessors) has not, in the
past five (5) years, changed its jurisdiction of formation, organizational
structure or type, or any organizational number assigned by its jurisdiction;
and (f) all other information set forth on the Perfection Certificate pertaining
to Borrower and each of its Subsidiaries is accurate and complete in all
material respects (it being understood and agreed that Borrower may from time to
time update certain information in the Perfection Certificate after the
Effective Date to the extent permitted by one or more specific provisions in
this Agreement).   If Borrower is not now a Registered Organization but later
becomes one, Borrower shall promptly notify Agent of such occurrence and provide
Agent with Borrower’s organizational identification number.

The execution, delivery and performance by Borrower of the Loan Documents to
which it is a party have been duly authorized, and do not (i) conflict with any
of Borrower’s organizational documents, (ii) contravene, conflict with,
constitute a default under or violate any material Requirement of Law, (iii)
contravene, conflict or violate any applicable order, writ, judgment,
injunction, decree, determination or award of any Governmental Authority by
which Borrower or any of its Subsidiaries or any of their property or assets may
be bound or affected, (iv) require any action by, filing, registration, or
qualification with, or Governmental Approval from, any Governmental Authority
(except such Governmental Approvals which have already been obtained and are in
full force and effect and filings and registrations contemplated by this
Agreement) or (v) conflict with, contravene, constitute a default or breach
under, or result in or permit the termination or acceleration of, any material
agreement by which Borrower is bound.  Borrower is not in default under any
agreement to which it is a party or by which it is bound in which the default
could reasonably be expected to have a material adverse effect on Borrower’s
business.  

5.2Collateral.  Borrower has good title to, rights in, and the power to transfer
each item of the Collateral upon which it purports to grant a Lien under this
Agreement and other Loan Documents, free and clear of any and all Liens except
Permitted Liens.  Borrower has no Collateral Accounts at or with any bank or
financial institution other than SVB or SVB’s Affiliates except for the
Collateral Accounts described in the Perfection Certificate delivered to Agent
and each Lender in connection herewith and which Borrower has given Agent notice
and taken such actions as are necessary to give Agent, for the ratable benefit
of the Lenders, a perfected security interest therein, pursuant to the terms of
Section 6.6(b).  The Accounts are bona fide, existing obligations of the Account
Debtors.  

The Collateral is not in the possession of any third party bailee (such as a
warehouse) except as otherwise provided in the Perfection Certificate.  None of
the components of the Collateral shall be maintained at locations other than as
provided in the Perfection Certificate or as permitted pursuant to Section 7.2.

All Inventory is in all material respects of good and marketable quality, free
from material defects.

Borrower is the sole owner of the Intellectual Property which it owns or
purports to own except for (a) non-exclusive licenses granted to its customers
in the ordinary course of business, (b) over-the-counter software that is
commercially available to the public, and (c) material Intellectual Property
licensed to Borrower and noted on the Perfection Certificate.  Each Patent which
it owns or purports to own and which is material to Borrower’s business is valid
and enforceable, and no part of the Intellectual Property which Borrower owns or
purports to own and which is material to Borrower’s business has been judged
invalid or unenforceable, in whole or in part.  To the best of Borrower’s
knowledge, no claim has been made that any part of the Intellectual Property
violates the rights of any third party except to the extent such claim would not
reasonably be expected to have a material adverse effect on

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Borrower’s business. Except as noted on the Perfection Certificate, Borrower is
not a party to, nor is it bound by, any Restricted License.

5.3Litigation.  There are no actions or proceedings pending or, to the knowledge
of any Responsible Officer, threatened in writing by or against Borrower or any
of its Subsidiaries reasonably expected to result in liability involving more
than, individually or in the aggregate, Two Hundred Fifty Thousand Dollars
($250,000.00).

5.4Financial Statements; Financial Condition.  All consolidated financial
statements for Borrower and any of its Subsidiaries delivered to Agent and the
Lenders fairly present in all material respects Borrower’s consolidated
financial condition and Borrower’s consolidated results of operations.  There
has not been any material deterioration in Borrower’s consolidated financial
condition since the date of the most recent financial statements submitted to
Agent and the Lenders.

5.5Solvency.  The fair salable value of Borrower’s consolidated assets
(including goodwill minus disposition costs) exceeds the fair value of
Borrower’s liabilities; Borrower is not left with unreasonably small capital
after the transactions in this Agreement; and Borrower is able to pay its debts
(including trade debts) as they mature.

5.6Regulatory Compliance.  Borrower is not an “investment company” or a company
“controlled” by an “investment company” under the Investment Company Act of
1940, as amended.  Borrower is not engaged as one of its important activities in
extending credit for margin stock (under Regulations X, T and U of the Federal
Reserve Board of Governors).  Borrower (a) has complied in all material respects
with all Requirements of Law, and (b) has not violated any Requirements of Law
the violation of which could reasonably be expected to have a material adverse
effect on its business.  None of Borrower’s or any of its Subsidiaries’
properties or assets has been used by Borrower or any Subsidiary or, to the best
of Borrower’s knowledge, by previous Persons, in disposing, producing, storing,
treating, or transporting any hazardous substance other than legally.  Borrower
and each of its Subsidiaries have obtained all consents, approvals and
authorizations of, made all declarations or filings with, and given all notices
to, all Governmental Authorities that are necessary to continue their respective
businesses as currently conducted.

5.7Subsidiaries; Investments.  Borrower does not own any stock, partnership, or
other ownership interest or other equity securities except for Permitted
Investments.  

5.8Tax Returns and Payments; Pension Contributions.  Borrower has timely filed
all required tax returns and reports, and Borrower has timely paid all foreign,
federal, state and local taxes, assessments, deposits and contributions owed by
Borrower except (a) to the extent such taxes are being contested in good faith
by appropriate proceedings promptly instituted and diligently conducted, so long
as such reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made therefor, or (b) if such taxes,
assessments, deposits and contributions do not, individually or in the
aggregate, exceed Fifty Thousand Dollars ($50,000.00).  

To the extent Borrower defers payment of any contested taxes, Borrower shall (i)
notify Agent in writing of the commencement of, and any material development in,
the proceedings and (ii) post bonds or take any other steps required to prevent
the Governmental Authority levying such contested taxes from obtaining a Lien
upon any of the Collateral that is other than a “Permitted Lien.”  Borrower is
unaware of any claims or adjustments proposed for any of Borrower’s prior tax
years which could result in additional taxes becoming due and payable by
Borrower in excess of Fifty Thousand Dollars ($50,000.00).  Borrower has paid
all amounts necessary to fund all present pension, profit sharing and deferred
compensation plans in accordance with their terms, and Borrower has not
withdrawn from participation in, and has not permitted partial or complete
termination of, or permitted the occurrence of any other event with respect to,
any such plan which could reasonably be expected to result in any liability of
Borrower, including any liability to the Pension Benefit Guaranty Corporation or
its successors or any other governmental agency.

5.9Use of Proceeds.  Borrower shall use the proceeds of the Credit Extensions as
working capital and to fund its general business requirements and not for
personal, family, household or agricultural purposes.

5.10Full Disclosure.  No written representation, warranty or other statement of
Borrower in any certificate or written statement given to Agent or any Lender in
connection with the Loan Documents, or the

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transactions contemplated thereby, as of the date such representation, warranty,
or other statement was made, taken together with all such written certificates
and written statements given to Agent or any Lender, contains any untrue
statement of a material fact or omits to state a material fact necessary to make
the statements contained in the certificates or statements not misleading (it
being recognized by Agent and each Lender that the projections and forecasts
provided by Borrower in good faith and based upon reasonable assumptions are not
viewed as facts and that actual results during the period or periods covered by
such projections and forecasts may differ from the projected or forecasted
results).

5.11Definition of “Knowledge.”  For purposes of the Loan Documents, whenever a
representation or warranty is made to Borrower’s knowledge or awareness, to the
“best of” Borrower’s knowledge, or with a similar qualification, knowledge or
awareness means the actual knowledge, after reasonable investigation, of any
Responsible Officer.

6AFFIRMATIVE COVENANTS

Borrower shall do all of the following:

6.1Government Compliance.  

(a)Maintain its and all its Subsidiaries’ legal existence and good standing in
their respective jurisdictions of formation and maintain qualification in each
jurisdiction in which the failure to so qualify would reasonably be expected to
have a material adverse effect on Borrower’s business or operations.  Borrower
shall comply, and have each Subsidiary comply, in all material respects, with
all laws, ordinances and regulations to which it is subject.

(b)Obtain all of the Governmental Approvals necessary for the performance by
Borrower of its obligations under the Loan Documents to which it is a party and
the grant of a security interest to Agent, for the ratable benefit of the
Lenders, in all of its property.  Borrower shall promptly provide copies of any
such obtained Governmental Approvals to Agent.

6.2Financial Statements, Reports, Certificates.  Provide Agent and each Lender
with the following:

(a)Monthly Financial Statements.  As soon as available, but no later than thirty
(30) days after the last day of each month, a company prepared consolidated and
consolidating (if applicable) balance sheet, and income statement covering
Borrower’s and each of its Subsidiary’s consolidated operations for such month
certified by a Responsible Officer and in a form of presentation reasonably
acceptable to Agent (the “Monthly Financial Statements”);

(b)Monthly Compliance Certificate.  Within thirty (30) days after the last day
of each month and together with the Monthly Financial Statements, a duly
completed Compliance Certificate signed by a Responsible Officer, certifying
that as of the end of such month, Borrower was in full compliance with all of
the terms and conditions of this Agreement, and setting forth calculations
showing compliance with the financial covenants (if any) set forth in this
Agreement and such other information as Agent or the Lenders may reasonably
request;

(c)Annual Operating Budget and Financial Projections.  As soon as available, at
least annually, but no later than sixty (60) days after each fiscal year end of
Borrower and within thirty (30) days of any board-approved updates or amendments
thereto, (i) annual operating budgets (including income statements, balance
sheets and cash flow statements, by month) for such fiscal year of Borrower, and
(ii) annual financial projections for such fiscal year (on a quarterly basis) as
approved by Borrower’s board of directors, together with any related business
forecasts used in the preparation of such annual financial projections;

(d)Annual Audited Financial Statements.  As soon as available, but no later than
within one hundred fifty (150) days after the last day of Borrower’s fiscal
year, audited consolidated financial statements prepared under GAAP,
consistently applied, together with an unqualified opinion on the financial
statements from an independent certified public accounting firm reasonably
acceptable to Agent;

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(e)Other Statements.  Within five (5) days of delivery, copies of all
statements, reports and notices made available to Borrower’s security holders or
to any holders of Subordinated Debt;

(f)SEC Filings.  Within five (5) days of filing, copies of all periodic and
other reports, proxy statements and other materials filed by Borrower with the
SEC, any Governmental Authority succeeding to any or all of the functions of the
SEC or with any national securities exchange, or distributed to its
shareholders, as the case may be.  Documents required to be delivered pursuant
to the terms hereof (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date on which Borrower
posts such documents, or provides a link thereto, on Borrower’s website on the
internet at Borrower’s website address; provided, however, Borrower shall
promptly notify Agent and the Lenders in writing (which may be by electronic
mail) of the posting of any such documents;

(g)Legal Action Notice.  A prompt report of any legal actions pending or
threatened in writing against Borrower or any of its Subsidiaries that could
reasonably be expected to result in damages or costs to Borrower or any of its
Subsidiaries of, individually or in the aggregate, Two Hundred Fifty Thousand
Dollars ($250,000.00) or more; and

(h)Other Financial Information.  Other financial information reasonably
requested by Agent or any Lender.

6.3Taxes; Pensions.  (i) Timely file, and require each of its Subsidiaries to
timely file, all required tax returns and reports and timely pay, and require
each of its Subsidiaries to timely pay, all foreign, federal, state and local
taxes, assessments, deposits and contributions owed by Borrower and each of its
Subsidiaries, except for (x) deferred payment of any taxes contested pursuant to
the terms of Section 5.8 hereof, and shall deliver to Agent, on demand,
appropriate certificates attesting to such payments, and (ii) pay all amounts
necessary to fund all present pension, profit sharing and deferred compensation
plans in accordance with their terms.

6.4Inventory; Returns.  Keep all Inventory in good and marketable condition,
free from material defects.  Returns and allowances between Borrower and its
Account Debtors shall follow Borrower’s customary practices as they exist at the
Effective Date.  Borrower must promptly notify Agent and the Lenders of all
returns, recoveries, disputes and claims that involve more than Two Hundred
Fifty Thousand Dollars ($250,000.00).

6.5Insurance.  

(a)Keep its business and the Collateral insured for risks and in amounts
standard for companies in Borrower’s industry and location and as Agent may
reasonably request.  Insurance policies shall be in a form, with financially
sound and reputable insurance companies that are not Affiliates of Borrower, and
in amounts that are satisfactory to Agent.  All property policies shall have a
lender’s loss payable endorsement showing Agent as the sole lender loss
payee.  All liability policies shall show, or have endorsements showing, Agent
as an additional insured.  Agent shall be named as lender loss payee and/or
additional insured with respect to any such insurance providing coverage in
respect of any Collateral.

(b)Ensure that proceeds payable under any property policy are, at Agent’s
option, payable to Agent for the ratable benefit of the Lenders on account of
the Obligations.

(c)At Agent’s request, Borrower shall deliver certified copies of insurance
policies and evidence of all premium payments.  Each provider of any such
insurance required under this Section 6.5 shall agree, by endorsement upon the
policy or policies issued by it or by independent instruments furnished to
Agent, that it will give Agent thirty (30) days prior written notice before any
such policy or policies shall be materially altered or canceled.  If Borrower
fails to obtain insurance as required under this Section 6.5 or to pay any
amount or furnish any required proof of payment to third persons and Agent,
Agent may make all or part of such payment or obtain such insurance policies
required in this Section 6.5, and take any action under the policies Agent deems
prudent.

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6.6Operating Accounts.

(a)Maintain all of Borrower’s and all of its Subsidiaries’ operating, depository
and securities/investment accounts with SVB and SVB’s Affiliates.  In addition,
Borrower and any Guarantor shall use SVB’s credit cards for all corporate credit
card services and shall conduct all other primary banking with SVB for Bank
Services.

(b)Provide Agent five (5) days prior written notice before establishing any
Collateral Account at or with any bank or financial institution other than SVB
or SVB’s Affiliates. Borrower shall indicate in the Compliance Certificate
provided to Agent in accordance with Section 6.2(b) above any deposit or
securities account it holds at or with any bank or financial institution other
than SVB or SVB’s Affiliates and the aggregate value of deposits and/or
securities in any such account.  In addition, for each account that the Lenders
in their sole discretion permit Borrower at any time to open or maintain (other
than accounts at SVB), Borrower shall cause the applicable bank or financial
institution (other than SVB) at or with which any such Collateral Account is
opened or maintained to execute and deliver a Control Agreement or other
appropriate instrument with respect to such Collateral Account to perfect
Agent’s Lien in such Collateral Account in accordance with the terms hereunder,
which Control Agreement may not be terminated without the prior written consent
of the Lenders.  The provisions of the previous sentence shall not apply to
deposit accounts exclusively used for payroll, payroll taxes and other employee
wage and benefit payments to or for the benefit of Borrower’s employees and
identified to Agent and the Lenders by Borrower as such.

6.7Protection of Intellectual Property Rights.

(a)(i) Protect, defend and maintain the validity and enforceability of any
Intellectual Property; (ii) promptly advise Agent in writing of material
infringements or any other event that could reasonably be expected to materially
and adversely affect the value of its Intellectual Property; and (iii) not allow
any Intellectual Property material to Borrower’s business to be abandoned,
forfeited or dedicated to the public without Agent’s written consent.  

(b)Provide written notice to Agent within ten (10) days of entering or becoming
bound by any Restricted License (other than over-the-counter software that is
commercially available to the public).  Borrower shall take such steps as Agent
requests to obtain the consent of, or waiver by, any person whose consent or
waiver is necessary for (i) any Restricted License to be deemed “Collateral” and
for Agent to have a security interest in it that might otherwise be restricted
or prohibited by law or by the terms of any such Restricted License, whether now
existing or entered into in the future, and (ii) Agent to have the ability in
the event of a liquidation of any Collateral to dispose of such Collateral in
accordance with Agent’s and the Lenders’ rights and remedies under this
Agreement and the other Loan Documents.

6.8Litigation Cooperation.  From the date hereof and continuing through the
termination of this Agreement, make available to Agent, without expense to Agent
or any Lender, Borrower and its officers, employees and agents and Borrower’s
books and records, to the extent that Agent and/or the Lenders may deem them
reasonably necessary to prosecute or defend any third-party suit or proceeding
instituted by or against Agent and/or any Lender with respect to any Collateral
or relating to Borrower.

6.9Access to Collateral; Books and Records.  Allow Agent or its agents, at
reasonable times, on one (1) Business Days’ notice (provided no notice is
required if an Event of Default has occurred and is continuing), to inspect the
Collateral and audit and copy Borrower’s Books.  Such inspections or audits
shall be conducted no more often than once every twelve (12) months unless an
Event of Default has occurred and is continuing in which case such inspections
and audits shall occur as often as Agent shall determine is necessary.  The
foregoing inspections and audits shall be at Borrower’s expense and the charge
therefor shall be Two Thousand Dollars ($2,000.00) per person per day (or such
higher amount as shall represent Agent’s then-current standard charge for the
same), plus reasonable out-of-pocket expenses.  In the event Borrower and Agent
schedule an audit more than eight (8) days in advance, and Borrower cancels or
reschedules the audit with less than eight (8) days written notice to Agent,
then (without limiting any of Agent’s or any Lender’s rights or remedies)
Borrower shall pay Agent a fee of Two Thousand Dollars ($2,000.00) plus any
out-of-pocket expenses incurred by Agent to compensate Agent for the anticipated
costs and expenses of the cancellation or rescheduling.

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6.10Formation or Acquisition of Subsidiaries.  Notwithstanding and without
limiting the negative covenants contained in Sections 7.3 and 7.7 hereof, at the
time that Borrower or any Guarantor forms any direct or indirect Subsidiary or
acquires any direct or indirect Subsidiary after the Effective Date, Borrower
and such Guarantor shall (a) cause such new Subsidiary to provide to Agent, for
the benefit of the Lenders, a joinder to the Loan Agreement to cause such
Subsidiary to become a co-borrower or Guarantor (as determined by the Lenders in
their sole discretion) hereunder, together with such appropriate financing
statements and/or Control Agreements, all in form and substance satisfactory to
the Lenders (including being sufficient to grant Agent, for the benefit of the
Lenders a first priority Lien (subject to Permitted Liens) in and to the assets
of such newly formed or acquired Subsidiary), (b) provide to the Agent for the
benefit of the Lenders appropriate certificates and powers and financing
statements, pledging all of the direct or beneficial ownership interest in such
new Subsidiary, in form and substance satisfactory to the Lenders, and (c)
provide to the Lenders all other documentation in form and substance
satisfactory to the Lenders, including one or more opinions of counsel
satisfactory to the Lenders, which in their opinion is appropriate with respect
to the execution and delivery of the applicable documentation referred to
above.  Any document, agreement, or instrument executed or issued pursuant to
this Section 6.10 shall be a Loan Document.

6.11Further Assurances.  Execute any further instruments and take further action
as Agent and the Lenders reasonably request to perfect or continue Agent’s Lien
in the Collateral or to effect the purposes of this Agreement.  Deliver to Agent
and the Lenders, within five (5) days after the same are sent or received,
copies of all correspondence, reports, documents and other filings with any
Governmental Authority regarding compliance with or maintenance of Governmental
Approvals or Requirements of Law or that could reasonably be expected to have a
material effect on any of the Governmental Approvals or otherwise on the
operations of Borrower or any of its Subsidiaries.  

7NEGATIVE COVENANTS

Borrower shall not do any of the following without the prior written consent of
the Lenders:

7.1Dispositions.  Convey, sell, lease, transfer, assign, or otherwise dispose of
(collectively a “Transfer”), or permit any of its Subsidiaries to Transfer, all
or any part of its business or property, except for Transfers (a) of Inventory
in the ordinary course of business; (b) of worn-out or obsolete Equipment that
is, in the reasonable judgment of Borrower, no longer economically practicable
to maintain or useful in the ordinary course of business of Borrower; (c)
consisting of Permitted Liens and Permitted Investments; (d) consisting of the
sale or issuance of any stock of Borrower permitted under Section 7.2 of this
Agreement; (e) consisting of Borrower’s use or transfer of money or Cash
Equivalents in a manner that is not prohibited by the terms of this Agreement or
the other Loan Documents; and (f) of non-exclusive licenses for the use of the
property of Borrower or its Subsidiaries in the ordinary course of business and
licenses that could not result in a legal transfer of title of the licensed
property but that may be exclusive in respects other than territory and that may
be exclusive as to territory only as to discreet geographical areas outside of
the United States.

7.2Changes in Business, Management, Control, or Business Locations.  (a) Engage
in or permit any of its Subsidiaries to engage in any business other than the
businesses currently engaged in by Borrower and such Subsidiary, as applicable,
or reasonably related thereto; (b) liquidate or dissolve; (c) fail to provide
notice to Agent and Lenders of any Key Person departing from or ceasing to be
employed by Borrower within ten (10) Business Days after such Key Person’s
departure from Borrower; or (d) permit or suffer any Change in Control.  

Borrower shall not, without at least ten (10) days prior written notice to
Agent: (1) add any new offices or business locations, including warehouses
(unless such new offices or business locations contain less than Two Hundred
Fifty Thousand Dollars ($250,000.00) in Borrower’s assets or property) or
deliver any portion of the Collateral valued, individually or in the aggregate,
in excess of Two Hundred Fifty Thousand Dollars ($250,000.00) to a bailee at a
location other than to a bailee and at a location already disclosed in the
Perfection Certificate, (2) change its jurisdiction of organization, (3) change
its organizational structure or type, (4) change its legal name, or (5) change
any organizational number (if any) assigned by its jurisdiction of
organization.  If Borrower intends to add any new offices or business locations,
including warehouses, containing in excess of Two Hundred Fifty Thousand Dollars
($250,000.00) of Borrower’s assets or property, then Borrower will cause the
landlord of any such new offices or business locations, including warehouses, to
execute and deliver a landlord consent in form and substance satisfactory to
Agent.   If Borrower intends to deliver any portion of the Collateral valued,
individually or in the aggregate, in

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excess of Two Hundred Fifty Thousand Dollars ($250,000.00) to a bailee, and
Agent and such bailee are not already parties to a bailee agreement governing
both the Collateral and the location to which Borrower intends to deliver the
Collateral, then Borrower will cause such bailee to execute and deliver a bailee
agreement in form and substance reasonably satisfactory to Agent.

7.3Mergers or Acquisitions.  Merge or consolidate, or permit any of its
Subsidiaries to merge or consolidate, with any other Person, or acquire, or
permit any of its Subsidiaries to acquire, all or substantially all of the
capital stock or property of another Person (including, without limitation, by
the formation of any Subsidiary).  A Subsidiary may merge or consolidate into
another Subsidiary or into Borrower.

7.4Indebtedness.  Create, incur, assume, or be liable for any Indebtedness, or
permit any Subsidiary to do so, other than Permitted Indebtedness.

7.5Encumbrance.  Create, incur, allow, or suffer any Lien on any of its
property, or assign or convey any right to receive income, including the sale of
any Accounts, or permit any of its Subsidiaries to do so, except for Permitted
Liens, permit any Collateral not to be subject to the first priority security
interest granted herein, or enter into any agreement, document, instrument or
other arrangement (except with or in favor of Agent, for the ratable benefit of
the Lenders) with any Person which directly or indirectly prohibits or has the
effect of prohibiting Borrower or any Subsidiary from assigning, mortgaging,
pledging, granting a security interest in or upon, or encumbering any of
Borrower’s or any Subsidiary’s Intellectual Property, except as is otherwise
permitted in Section 7.1 hereof and the definition of “Permitted Liens” herein.

7.6Maintenance of Collateral Accounts.  Maintain any Collateral Account except
pursuant to the terms of Section 6.6(b) hereof.

7.7Distributions; Investments.  (a) Pay any dividends or make any distribution
or payment or redeem, retire or purchase any capital stock, provided that (i)
Borrower may convert any of its convertible securities into other securities
pursuant to the terms of such convertible securities or otherwise in exchange
thereof; (ii) Borrower may pay dividends solely in common stock; and (iii)
Borrower may repurchase the stock of former employees, officers, directors or
consultants pursuant to stock repurchase agreements so long as an Event of
Default does not exist at the time of such repurchase and would not exist after
giving effect to such repurchase, provided that the aggregate amount of all such
repurchases does not exceed Two Hundred Fifty Thousand Dollars ($250,000.00) per
fiscal year; or (b) directly or indirectly make any Investment (including,
without limitation, by the formation of any Subsidiary) other than Permitted
Investments, or permit any of its Subsidiaries to do so.

7.8Transactions with Affiliates.  Directly or indirectly enter into or permit to
exist any material transaction with any Affiliate of Borrower, except for
transactions that are in the ordinary course of Borrower’s business, upon fair
and reasonable terms that are no less favorable to Borrower than would be
obtained in an arm’s length transaction with a non-affiliated Person.

7.9Subordinated Debt.  (a) Make or permit any payment on any Subordinated Debt,
except under the terms of the subordination, intercreditor, or other similar
agreement to which such Subordinated Debt is subject, or (b) amend any provision
in any document relating to the Subordinated Debt which would increase the
amount thereof, provide for earlier or greater principal, interest, or other
payments thereon, or adversely affect the subordination thereof to Obligations
owed to Agent and the Lenders.

7.10Compliance.  Become an “investment company” or a company controlled by an
“investment company”, under the Investment Company Act of 1940, as amended, or
undertake as one of its important activities extending credit to purchase or
carry margin stock (as defined in Regulation U of the Board of Governors of the
Federal Reserve System), or use the proceeds of any Credit Extension for that
purpose; fail to (a) meet the minimum funding requirements of ERISA, (b) prevent
a Reportable Event or Prohibited Transaction, as defined in ERISA, from
occurring, or (c) comply with the Federal Fair Labor Standards Act, the failure
of any of the conditions described in clauses (a) through (c) which could
reasonably be expected to have a material adverse effect on Borrower’s business;
or violate any other law or regulation, if the violation could reasonably be
expected to have a material adverse effect on Borrower’s business, or permit any
of its Subsidiaries to do so; withdraw or permit any Subsidiary to withdraw from
participation in, permit partial or complete termination of, or permit the
occurrence of any other event with

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respect to, any present pension, profit sharing and deferred compensation plan
which could reasonably be expected to result in any liability of Borrower,
including any liability to the Pension Benefit Guaranty Corporation or its
successors or any other governmental agency.

8EVENTS OF DEFAULT

Any one of the following shall constitute an event of default (an “Event of
Default”) under this Agreement:

8.1Payment Default.  Borrower fails to (a) make any payment of principal or
interest on any Credit Extension when due, or (b) pay any other Obligations
within three (3) Business Days after such Obligations are due and payable (which
three (3) Business Day cure period shall not apply to payments due on the Growth
Capital Maturity Date).  During the cure period, the failure to make or pay any
payment specified under clause (b) hereunder is not an Event of Default (but no
Credit Extension will be made during the cure period);

8.2Covenant Default.  

(a) Borrower fails or neglects to perform any obligation in Sections 6.2, 6.3,
6.5, 6.6, 6.7(b), 6.9, or 6.10, or violates any covenant in Section 7; or

(b) Borrower fails or neglects to perform, keep, or observe any other term,
provision, condition, covenant or agreement contained in this Agreement or any
Loan Documents, and as to any default (other than those specified in this
Section 8) under such other term, provision, condition, covenant or agreement
that can be cured, has failed to cure the default within ten (10) days after the
occurrence thereof; provided, however, that if the default cannot by its nature
be cured within the ten (10) day period or cannot after diligent attempts by
Borrower be cured within such ten (10) day period, and such default is likely to
be cured within a reasonable time, then Borrower shall have an additional period
(which shall not in any case exceed thirty (30) days) to attempt to cure such
default, and within such reasonable time period the failure to cure the default
shall not be deemed an Event of Default (but no Credit Extensions shall be made
during such cure period).  Cure periods provided under this section shall not
apply, among other things, to financial covenants or any other covenants set
forth in clause (a) above;

8.3Material Adverse Change.  A Material Adverse Change occurs;

8.4Attachment; Levy; Restraint on Business.  

(a)(i) The service of process seeking to attach, by trustee or similar process,
any funds of Borrower or of any entity under the control of Borrower (including
a Subsidiary), or (ii) a notice of lien or levy is filed against any of
Borrower’s assets by any Governmental Authority, and the same under subclauses
(i) and (ii) hereof are not, within ten (10) days after the occurrence thereof,
discharged or stayed (whether through the posting of a bond or otherwise);
provided, however, no Credit Extensions shall be made during any ten (10) day
cure period; or

(b) (i) any material portion of Borrower’s assets is attached, seized, levied
on, or comes into possession of a trustee or receiver, or (ii) any court order
enjoins, restrains, or prevents Borrower from conducting all or any material
part of its business;

8.5Insolvency.  (a) Borrower or any of its Subsidiaries is unable to pay its
debts (including trade debts) as they become due or otherwise becomes insolvent;
(b) Borrower or any of its Subsidiaries begins an Insolvency Proceeding; or
(c) an Insolvency Proceeding is begun against Borrower or any of its
Subsidiaries and is not dismissed or stayed within thirty (30) days (but no
Credit Extensions shall be made while any of the conditions described in clause
(a) exist and/or until any Insolvency Proceeding is dismissed);

8.6Other Agreements.  There is, under any agreement to which Borrower or any
Guarantor is a party with a third party or parties, (a) any default resulting in
a right by such third party or parties, whether or not exercised, to accelerate
the maturity of any Indebtedness in an amount individually or in the aggregate
in excess of Two Hundred Fifty Thousand Dollars ($250,000.00); or (b) any breach
or default by Borrower or Guarantor, the result of which could reasonably be
expected to have a material adverse effect on Borrower’s or any Guarantor’s
business;

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8.7Judgments; Penalties.  One or more fines, penalties, or final judgments,
orders or decrees for the payment of money in an amount, individually or in the
aggregate, of at least Two Hundred Fifty Thousand Dollars ($250,000.00) (not
covered by independent third-party insurance as to which liability has been
accepted by such insurance carrier) shall be rendered against Borrower by any
Governmental Authority, and the same are not, within ten (10) days after the
entry, assessment or issuance thereof, discharged, satisfied, or paid, or after
execution thereof, stayed or bonded pending appeal, or such judgments are not
discharged prior to the expiration of any such stay (provided that no Credit
Extensions will be made prior to the satisfaction, payment, discharge, stay, or
bonding of such fine, penalty, judgment, order or decree);

8.8Misrepresentations.  Borrower or any Person acting for Borrower makes any
representation, warranty, or other statement now or later in this Agreement, any
Loan Document or in any writing delivered to Agent or any Lender or to induce
Agent or any Lender to enter this Agreement or any Loan Document, and such
representation, warranty, or other statement is incorrect in any material
respect when made;

8.9Subordinated Debt.  Any document, instrument, or agreement evidencing any
Subordinated Debt shall for any reason be revoked or invalidated or otherwise
cease to be in full force and effect, any Person shall be in breach thereof or
contest in any manner the validity or enforceability thereof or deny that it has
any further liability or obligation thereunder, or the Obligations shall for any
reason be subordinated or shall not have the priority contemplated by this
Agreement;

8.10Guaranty.  (a) Any guaranty of any Obligations terminates or ceases for any
reason to be in full force and effect; (b) any Guarantor does not perform any
obligation or covenant under any guaranty of the Obligations; (c) any
circumstance described in Sections 8.3, 8.4, 8.5, 8.7, or 8.8 occurs with
respect to any Guarantor, or (d) the death, liquidation, winding up, or
termination of existence of any Guarantor; or (e) (i) a material impairment in
the perfection or priority of Agent’s Lien in the collateral provided by
Guarantor or in the value of such collateral or (ii) a material adverse change
in the general affairs, management, results of operation, condition (financial
or otherwise) or the prospect of repayment of the Obligations occurs with
respect to any Guarantor; or

8.11Governmental Approvals.  Any Governmental Approval shall have been
(a) revoked, rescinded, suspended, modified in an adverse manner or not renewed
in the ordinary course for a full term or (b) subject to any decision by a
Governmental Authority that designates a hearing with respect to any
applications for renewal of any of such Governmental Approval or that could
result in the Governmental Authority taking any of the actions described in
clause (a) above, and such decision or such revocation, rescission, suspension,
modification or non-renewal (i) cause, or could reasonably be expected to cause,
a Material Adverse Change, or (ii)  adversely affects the legal qualifications
of Borrower or any of its Subsidiaries to hold such Governmental Approval in any
applicable jurisdiction and such revocation, rescission, suspension,
modification or non-renewal could reasonably be expected to affect the status of
or legal qualifications of Borrower or any of its Subsidiaries to hold any
Governmental Approval in any other jurisdiction.

9RIGHTS AND REMEDIES

9.1Rights and Remedies.  Upon the occurrence and during the continuance of an
Event of Default, Agent, in accordance with the Lender Intercreditor Agreement
or, if such rights and remedies are not addressed in the Lender Intercreditor
Agreement, as directed by a majority of the Lenders, may, without notice or
demand, do any or all of the following:

(a)declare all Obligations immediately due and payable (but if an Event of
Default described in Section 8.5 occurs all Obligations are immediately due and
payable without any action by Agent or any Lender);

(b)stop advancing money or extending credit for Borrower’s benefit under this
Agreement or under any other agreement among Borrower, Agent and/or any Lenders;

(c)demand that Borrower (i) deposit cash with SVB in an amount equal to at least
(x) one hundred five percent (105.0%) of the Dollar Equivalent of the aggregate
face amount of all Letters of Credit denominated in Dollars remaining undrawn,
and (y) one hundred ten percent (110.0%) of the Dollar Equivalent of the

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aggregate face amount of all Letters of Credit denominated in a Foreign Currency
remaining undrawn (plus, in each case, all interest, fees, and costs due or to
become due in connection therewith (as estimated by SVB in its good faith
business judgment)), to secure all of the Obligations relating to such Letters
of Credit, as collateral security for the repayment of any future drawings under
such Letters of Credit, and Borrower shall forthwith deposit and pay such
amounts, and (ii) pay in advance all letter of credit fees scheduled to be paid
or payable over the remaining term of any Letters of Credit;

(d)terminate any FX Contracts;

(e)verify the amount of, demand payment of and performance under, and collect
any Accounts and General Intangibles, settle or adjust disputes and claims
directly with Account Debtors for amounts on terms and in any order that Agent
and/or the Lenders consider advisable, and notify any Person owing Borrower
money of Agent’s security interest in such funds;  

(f)make any payments and do any acts Agent or any Lender considers necessary or
reasonable to protect the Collateral and/or its security interest in the
Collateral.  Borrower shall assemble the Collateral if Agent requests and make
it available as Agent designates.  Agent may enter premises where the Collateral
is located, take and maintain possession of any part of the Collateral, and pay,
purchase, contest, or compromise any Lien which appears to be prior or superior
to its security interest or charges and pay all expenses incurred. Borrower
grants Agent a license to enter and occupy any of its premises, without charge,
to exercise any of Agent’s rights or remedies;

(g)apply to the Obligations (i) any balances and deposits of Borrower it holds,
or (ii) any amount held by Agent owing to or for the credit or the account of
Borrower;

(h)ship, reclaim, recover, store, finish, maintain, repair, prepare for sale,
advertise for sale, and sell the Collateral.  Agent, for the benefit of the
Lenders, is hereby granted a non-exclusive, royalty-free license or other right
to use, without charge, Borrower’s labels, Patents, Copyrights, mask works,
rights of use of any name, trade secrets, trade names, Trademarks, and
advertising matter, or any similar property as it pertains to the Collateral, in
completing production of, advertising for sale, and selling any Collateral and,
in connection with Agent’s exercise of its rights under this Section, Borrower’s
rights under all licenses and all franchise agreements inure to Agent, for the
ratable benefit of the Lenders;

(i)place a “hold” on any account maintained with Agent or Lenders and/or deliver
a notice of exclusive control, any entitlement order, or other directions or
instructions pursuant to any Control Agreement or similar agreements providing
control of any Collateral;

(j)demand and receive possession of Borrower’s Books; and

(k)exercise all rights and remedies available to Agent and the Lenders under the
Loan Documents or at law or equity, including all remedies provided under the
Code (including disposal of the Collateral pursuant to the terms thereof) or any
other applicable law.

9.2Power of Attorney.  Borrower hereby irrevocably appoints Agent, for the
benefit of the Lenders, as its lawful attorney-in-fact, exercisable upon the
occurrence and during the continuance of an Event of Default, to: (a) endorse
Borrower’s name on any checks or other forms of payment or security; (b) sign
Borrower’s name on any invoice or bill of lading for any Account or drafts
against Account Debtors; (c) settle and adjust disputes and claims about the
Accounts directly with Account Debtors, for amounts and on terms Agent
determines reasonable; (d) make, settle, and adjust all claims under Borrower’s
insurance policies; (e) pay, contest or settle any Lien, charge, encumbrance,
security interest, and adverse claim in or to the Collateral, or any judgment
based thereon, or otherwise take any action to terminate or discharge the same;
and (f) transfer the Collateral into the name of Agent or a third party as the
Code permits. Borrower hereby appoints Agent as its lawful attorney-in-fact to
sign Borrower’s name on any documents necessary to perfect or continue the
perfection of Agent’s security interest in the Collateral regardless of whether
an Event of Default has occurred until all Obligations have been satisfied in
full and Lenders are under no further obligation to make Credit Extensions
hereunder. Agent’s foregoing appointment as Borrower’s attorney in

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fact, and all of Agent’s rights and powers, coupled with an interest, are
irrevocable until all Obligations have been fully repaid and performed and each
Lender’s obligation to provide Credit Extensions terminates.

9.3Protective Payments.  If Borrower fails to obtain the insurance called for by
Section 6.5 or fails to pay any premium thereon or fails to pay any other amount
which Borrower is obligated to pay under this Agreement or any other Loan
Document or which may be required to preserve the Collateral, Agent may obtain
such insurance or make such payment, and all amounts so paid by Agent are
Lenders’ Expenses and immediately due and payable, bearing interest at the then
highest rate applicable to the Obligations, and secured by the Collateral. Agent
will make reasonable efforts to provide Borrower with notice of Agent obtaining
such insurance at the time it is obtained or within a reasonable time
thereafter. No payments by Agent are deemed an agreement to make similar
payments in the future or Agent’s or and Lenders’ waiver of any Event of
Default.

9.4Application of Payments and Proceeds Upon Default.  If an Event of Default
has occurred and is continuing, Agent shall have the right to apply in any order
any funds in its possession, whether from Borrower account balances, payments,
proceeds realized as the result of any collection of Accounts or other
disposition of the Collateral, or otherwise, to the Obligations. Agent shall pay
any surplus to Borrower by credit to the Designated Deposit Account or to other
Persons legally entitled thereto; Borrower shall remain liable to Agent and the
Lenders for any deficiency. If Agent, directly or indirectly, enters into a
deferred payment or other credit transaction with any purchaser at any sale of
Collateral, Agent shall have the option, exercisable at any time, of either
reducing the Obligations by the principal amount of the purchase price or
deferring the reduction of the Obligations until the actual receipt by Agent of
cash therefor.

9.5Liability for Collateral.  So long as Agent and Lenders comply with
reasonable banking practices regarding the safekeeping of the Collateral in
their possession or under the control of Agent and/or Lenders, Agent and Lenders
shall not be liable or responsible for: (a) the safekeeping of the Collateral;
(b) any loss or damage to the Collateral; (c) any diminution in the value of the
Collateral; or (d) any act or default of any carrier, warehouseman, bailee, or
other Person. Borrower bears all risk of loss, damage or destruction of the
Collateral.

9.6No Waiver; Remedies Cumulative.  Agent’s and any Lender’s failure, at any
time or times, to require strict performance by Borrower of any provision of
this Agreement or any other Loan Document shall not waive, affect, or diminish
any right of Agent or any Lender thereafter to demand strict performance and
compliance herewith or therewith. No waiver hereunder shall be effective unless
signed by the party granting the waiver and then is only effective for the
specific instance and purpose for which it is given. Agent’s and each Lender’s
rights and remedies under this Agreement and the other Loan Documents are
cumulative. Agent and each Lender have all rights and remedies provided under
the Code, by law, or in equity. Agent’s or any Lender’s exercise of one right or
remedy is not an election and shall not preclude Agent or any Lender from
exercising any other remedy under this Agreement or any other Loan Document or
other remedy available at law or in equity, and Agent’s or any Lender’s waiver
of any Event of Default is not a continuing waiver. Agent’s or any Lender’s
delay in exercising any remedy is not a waiver, election, or acquiescence.  

9.7Demand Waiver.  Borrower waives demand, notice of default or dishonor, notice
of payment and nonpayment, notice of any default, nonpayment at maturity,
release, compromise, settlement, extension, or renewal of accounts, documents,
instruments, chattel paper, and guarantees held by Agent on which Borrower is
liable.

10Agent

10.1Appointment and Authority.

(a)Each Lender hereby irrevocably appoints SVB to act on its behalf as Agent
hereunder and under the other Loan Documents and authorizes Agent to take such
actions on its behalf and to exercise such powers as are delegated to Agent by
the terms hereof or thereof, together with such actions and powers as are
reasonably incidental thereto.

(b)The provisions of this Section 10 are solely for the benefit of Agent and
Lenders, and Borrower shall not have rights as a third party beneficiary of any
of such provisions.  Notwithstanding any provision

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to the contrary elsewhere in this Agreement, Agent shall not have any duties or
responsibilities to any Lender or any other Person, except those expressly set
forth herein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or any other Loan Document or otherwise exist
against Agent.

10.2Delegation of Duties.  Agent may perform any and all of its duties and
exercise its rights and powers hereunder or under any other Loan Document by or
through any one or more sub-agents appointed by Agent.  Agent and any such
sub-agent may perform any and all of its duties and exercise its rights and
powers by or through their respective Indemnified Persons.  The exculpatory
provisions of this Section 10.2 shall apply to any such sub-agent and to the
Indemnified Persons of Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Agent.

10.3  Exculpatory Provisions.  Agent shall have no duties or obligations except
those expressly set forth herein and in the other Loan Documents.  Without
limiting the generality of the foregoing, Agent shall not:

(a)be subject to any fiduciary, trust, agency or other similar duties,
regardless of whether any Event of Default has occurred and is continuing;

(b)have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated hereby or
by the other Loan Documents that Agent is required to exercise as directed in
writing by the Lenders, as applicable; provided that Agent shall not be required
to take any action that, in its opinion or the opinion of its counsel, may
expose Agent to liability or that is contrary to any Loan Document or applicable
law; and

(c)except as expressly set forth herein and in the other Loan Documents, have
any duty to disclose, and Agent shall not be liable for the failure to disclose,
any information relating to Borrower or any of its Affiliates that is
communicated to or obtained by any Person serving as Agent or any of its
Affiliates in any capacity.

Agent shall not be liable for any action taken or not taken by it (i) with the
consent or at the request of the Lenders (or as Agent shall believe in good
faith shall be necessary, under the circumstances as provided in Section 13.7)
or (ii) in the absence of its own gross negligence or willful misconduct.

Agent shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein
or the occurrence of any Event of Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document or (v) the satisfaction of any condition
set forth in Section 3 or elsewhere herein, other than to confirm receipt of
items expressly required to be delivered to Agent.

 

10.4 Reliance by Agent.  Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic
message, internet or intranet website posting or other distribution) believed by
it to be genuine and to have been signed, sent or otherwise authenticated by the
proper Person.  Agent also may rely upon any statement made to it orally or by
telephone and believed by it to have been made by the proper Person, and shall
not incur any liability for relying thereon.  Agent may consult with legal
counsel (who may be counsel for Borrower), independent accountants and other
experts selected by it, and shall not be liable for any action taken or not
taken by it in accordance with the advice of any such counsel, accountants or
experts.  In determining compliance with any condition hereunder to the making
of a Credit Extension that, by its terms, must be fulfilled to the satisfaction
of a Lender, Agent may presume that such condition is satisfactory to such
Lender unless Agent shall have received notice to the contrary from such Lender
prior to the making of such Credit Extension.  Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and the
other Loan Documents in accordance with a request of the Lenders, and such
request and any action taken or failure to act pursuant thereto shall be binding
upon Lenders and all future holders of the Credit Extensions.

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10.5 Notice of Default.  Agent shall not be deemed to have knowledge or notice
of the occurrence of any Event of Default (except with respect to defaults in
the payment of principal, interest or fees required to be paid to Agent for the
account of Lenders), unless Agent has received notice from a Lender or Borrower
referring to this Agreement, describing such Event of Default and stating that
such notice is a “notice of default”.  In the event that Agent receives such a
notice, Agent shall give notice thereof to Lenders.  Agent shall take such
action with respect to such Event of Default as shall be reasonably directed by
the Lenders.

10.6 Non-Reliance on Agent and Other Lenders.  Each Lender expressly
acknowledges that neither Agent nor any of its officers, directors, employees,
agents, attorneys in fact or affiliates has made any representations or
warranties to it and that no act by Agent hereafter taken, including any review
of the affairs of a Group Member or any Affiliate of a Group Member, shall be
deemed to constitute any representation or warranty by Agent to any
Lender.  Each Lender represents to Agent that it has, independently and without
reliance upon Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of, and
investigation into, the business, operations, property, financial and other
condition and creditworthiness of the Group Members and their Affiliates and
made its own decision to make its Credit Extensions hereunder and enter into
this Agreement.  Each Lender also represents that it will, independently and
without reliance upon Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigation as
it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Group Members and
their Affiliates.  Except for notices, reports and other documents expressly
required to be furnished to Lenders by Agent hereunder, Agent shall have no duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Group Member or any Affiliate
of a Group Member that may come into the possession of Agent or any of its
officers, directors, employees, agents, attorneys in fact or Affiliates.

10.7Indemnification.  Each Lender agrees to indemnify Agent in its capacity as
such (to the extent not reimbursed by Borrower and without limiting the
obligation of Borrower to do so in accordance with the terms hereof, according
to its Growth Capital Loan Commitment Percentage in effect on the date on which
indemnification is sought under this Section 10.7 (or, if indemnification is
sought after the date upon which the Commitments shall have terminated and the
Obligations shall have been paid in full, in accordance with its Growth Capital
Loan Commitment Percentage immediately prior to such date), from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind whatsoever that
may at any time (whether before or after the payment of the Credit Extensions)
be imposed on, incurred by or asserted against Agent in any way relating to or
arising out of, the Commitments, this Agreement, any of the other Loan Documents
or any documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted by
Agent under or in connection with any of the foregoing; provided that no Lender
shall be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements that are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted primarily from Agent’s gross negligence
or willful misconduct.  The agreements in this Section shall survive the payment
of the Credit Extensions and all other amounts payable hereunder.

10.8Agent in Its Individual Capacity.  The Person serving as Agent hereunder
shall have the same rights and powers in its capacity as a Lender as any other
Lender and may exercise the same as though it were not Agent and the term
“Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the
context otherwise requires, include each such Person serving as Agent hereunder
in its individual capacity.  Such Person and its Affiliates may accept deposits
from, lend money to, act as the financial advisor or in any other advisory
capacity for and generally engage in any kind of business with Borrower, any
Guarantor or any Subsidiary or other Affiliate thereof as if such Person were
not Agent hereunder and without any duty to account therefor to Lenders.

10.9  Successor Agent.  Agent may at any time give notice of its resignation to
Lenders and Borrower, which resignation shall not be effective until the time at
which the majority of the Lenders have delivered to Agent their written consent
to such resignation.  Upon receipt of any such notice of resignation, the
Lenders shall have the right, in consultation with Borrower, to appoint a
successor, which shall be a financial institution with an office in the State of
California, or an Affiliate of any such bank with an office in the State of
California.  If no such successor shall have been so appointed by the Lenders
and shall have accepted such appointment within thirty (30) days after the

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retiring Agent has received the written consent of the majority of the Lenders
to such resignation, then the retiring Agent may on behalf of Lenders, appoint a
successor Agent meeting the qualifications set forth above; provided that in no
event shall any such successor Agent be a Defaulting Lender and provided further
that if the retiring Agent shall notify Borrower and Lenders that no qualifying
Person has accepted such appointment, then such resignation shall nonetheless
become effective in accordance with such notice and (1) the retiring Agent shall
be discharged from its duties and obligations hereunder and under the other Loan
Documents (except that in the case of any collateral security held by Agent on
behalf of the Lenders under any of the Loan Documents, the retiring Agent shall
continue to hold such collateral security until such time as a successor Agent
is appointed and such collateral security is assigned to such successor Agent)
and (2) all payments, communications and determinations provided to be made by,
to or through Agent shall instead be made by or to each Lender directly, until
such time as the Lenders appoint a successor Agent as provided for above in this
Section 10.9.  Upon the acceptance of a successor’s appointment as Agent
hereunder, such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring (or retired) Agent, and
the retiring Agent shall be discharged from all of its duties and obligations
hereunder or under the other Loan Documents (if not already discharged therefrom
as provided above in this Section 10.9).  The fees payable by Borrower to a
successor Agent shall be the same as those payable to its predecessor unless
otherwise agreed between the Borrower and such successor.  After the retiring
Agent’s resignation hereunder and under the other Loan Documents, the provisions
of this Section 10 shall continue in effect for the benefit of such retiring
Agent, its sub-agents and their respective Indemnified Persons in respect of any
actions taken or omitted to be taken by any of them while the retiring Agent was
acting as Agent.

10.10Defaulting Lender.  

(a)Defaulting Lender Adjustments.  Notwithstanding anything to the contrary
contained in this Agreement, if any Lender becomes a Defaulting Lender, then,
until such time as such Lender is no longer a Defaulting Lender, to the extent
permitted by applicable law:

(i)Waivers and Amendments.  Such Defaulting Lender’s right to approve or
disapprove any amendment, waiver or consent with respect to this Agreement shall
be restricted as long as said Lender is a Defaulting Lender.

(ii)Defaulting Lender Waterfall.  Any payment of principal, interest, fees or
other amounts received by the Agent for the account of such Defaulting Lender
(whether voluntary or mandatory, at maturity, pursuant to Section 8 or
otherwise, and including any amounts made available to the Agent by such
Defaulting Lender pursuant to Section 13.11), shall be applied at such time or
times as may be determined by the Agent as follows: first, to the payment of any
amounts owing by such Defaulting Lender to the Agent hereunder; second, as the
Borrower may request (so long as no Event of Default exists), to the funding of
any Growth Capital Advance in respect of which such Defaulting Lender has failed
to fund its portion thereof as required by this Agreement, as determined by the
Agent; third, if so determined by the Agent and Borrower, to be held in a
Deposit Account and released pro rata to satisfy such Defaulting Lender’s
potential future funding obligations with respect to Growth Capital Advances
under this Agreement; fourth, so long as no Event of Default has occurred and is
continuing, to the payment of any amounts owing to the Borrower as a result of
any judgment of a court of competent jurisdiction obtained by the Borrower
against such Defaulting Lender as a result of such Defaulting Lender’s breach of
its obligations under this Agreement; and fifth, to such Defaulting Lender or as
otherwise directed by a court of competent jurisdiction; provided that if
(A) such payment is a payment of the principal amount of any Growth Capital
Advances in respect of which such Defaulting Lender has not fully funded its
appropriate share and (B) such Growth Capital Advances were made at a time when
the conditions set forth in Section 3.1 were satisfied or waived, such payment
shall be applied solely to pay the Loans of all non-Defaulting Lenders on a pro
rata basis prior to being applied to the payment of any Growth Capital Advances
of such Defaulting Lender until such time as all Growth Capital Advances are
held by the Lenders pro rata in accordance with the Growth Capital Commitments
under this Agreement.  Any payments, prepayments or other amounts paid or
payable to a Defaulting Lender that are applied (or held) to pay amounts owed by
a Defaulting Lender pursuant to this Section 10.10(a)(ii) shall be deemed paid
to and redirected by such Defaulting Lender, and each Lender irrevocably
consents hereto.

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(iii)Certain Fees.  No Defaulting Lender shall be entitled to receive any fee
pursuant to Section 2.3(b) or Section 2.3(c) for any period during which such
Lender is a Defaulting Lender (and the Borrower shall not be required to pay any
such fee that otherwise would have been required to have been paid to such
Defaulting Lender).  

(b)Defaulting Lender Cure.  If Borrower and Agent agree in writing that a Lender
is no longer a Defaulting Lender, Agent will so notify the parties hereto,
whereupon as of the effective date specified in such notice and subject to any
conditions set forth therein, such Lender will, to the extent applicable,
purchase at par that portion of outstanding Growth Capital Advances of the other
Lenders or take such other actions as Agent may determine to be necessary to
cause the Growth Capital Advances to be held on a pro rata basis by the Lenders
in accordance with their respective Growth Capital Loan Commitment Percentages,
whereupon such Lender will cease to be a Defaulting Lender; provided that no
adjustments will be made retroactively with respect to fees accrued or payments
made by or on behalf of Borrower while such Lender was a Defaulting Lender; and
provided further that, except to the extent otherwise expressly agreed by the
affected parties, no change hereunder from Defaulting Lender to Lender will
constitute a waiver or release of any claim of any party hereunder arising from
such Lender having been a Defaulting Lender.

(c)Termination of Defaulting Lender.  The Borrower may terminate the unused
amount of the Growth Capital Commitment of any Lender that is a Defaulting
Lender upon not less than ten (10) Business Days’ prior notice to Agent (which
shall promptly notify the Lenders thereof), and in such event the provisions of
Section 10.10(a)(ii) will apply to all amounts thereafter paid by Borrower for
the account of such Defaulting Lender under this Agreement (whether on account
of principal, interest, fees, indemnity or other amounts); provided that (i) no
Event of Default shall have occurred and be continuing, and (ii) such
termination shall not be deemed to be a waiver or release of any claim Borrower,
Agent or any Lender may have against such Defaulting Lender.

(d)If the Person serving as Agent is a Defaulting Lender pursuant to clause (d)
of the definition thereof, the non-Defaulting Lenders may, to the extent
permitted by applicable law, by notice in writing to Borrower and such Person,
remove such Person as Agent and, in consultation with Borrower, appoint a
successor.  If no such successor shall have been so appointed by the
non-Defaulting Lenders and shall have accepted such appointment within thirty
(30) days (or such earlier day as shall be agreed by the non-Defaulting Lenders)
(the “Removal Effective Date”), then such removal shall nonetheless become
effective in accordance with such notice on the Removal Effective Date.

11NOTICES

All notices, consents, requests, approvals, demands, or other communication by
any party to this Agreement or any other Loan Document must be in writing and
shall be deemed to have been validly served, given, or delivered: (a) upon the
earlier of actual receipt and three (3) Business Days after deposit in the U.S.
mail, first class, registered or certified mail return receipt requested, with
proper postage prepaid; (b) upon transmission, when sent by electronic mail or
facsimile transmission; (c) one (1) Business Day after deposit with a reputable
overnight courier with all charges prepaid; or (d) when delivered, if
hand-delivered by messenger, all of which shall be addressed to the party to be
notified and sent to the address, facsimile number, or email address indicated
below. Agent or Borrower may change its mailing or electronic mail address or
facsimile number by giving the other party written notice thereof in accordance
with the terms of this Section 11.

 

If to Borrower:

Phasebio Pharmaceuticals, Inc.

1 Great Valley Parkway, Suite 30
Malvern, PA 19355
Attn:  Jonathan Mow, CEO
Email:  jonathan.mow@phasebio.com

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If to Agent or SVB:

Silicon Valley Bank

3475 Piedmont Road, Suite 560
Atlanta, GA 30305
Attn: Myron Jensen
Email: MJensen@svb.com   

 

with a copy to:

DLA Piper, LLP

401 B Street, Suite 1700
San Diego, CA 92101
Attn:  Laurie Hutchins
Fax:  858-638-5041
Email:  laurie.hutchins@dlapiper.com

 

If to WestRiver:

WestRiver Innovation Lending Fund VIII, L.P.

c/o WestRiver Management, LLC

3720 Carillon Point

Kirkland, Washington 98033-7455

Attn: Harper Ellison

Email: Harper@wrg.vc

12Choice of Law, Venue AND Jury Trial Waiver

Except as otherwise expressly provided in any of the Loan Documents, California
law governs the Loan Documents without regard to principles of conflicts of
law.  Except to the extent otherwise set forth in the Loan Documents, Borrower,
Agent and Lenders each submit to the exclusive jurisdiction of the State and
Federal courts in Santa Clara County, California; provided, however, that
nothing in this Agreement shall be deemed to operate to preclude Agent or
Lenders from bringing suit or taking other legal action in any other
jurisdiction to realize on the Collateral or any other security for the
Obligations, or to enforce a judgment or other court order in favor of Agent or
any Lender.  Borrower expressly submits and consents in advance to such
jurisdiction in any action or suit commenced in any such court, and Borrower
hereby waives any objection that it may have based upon lack of personal
jurisdiction, improper venue, or forum non conveniens and hereby consents to the
granting of such legal or equitable relief as is deemed appropriate by such
court.  Borrower hereby waives personal service of the summons, complaints, and
other process issued in such action or suit and agrees that service of such
summons, complaints, and other process may be made by registered or certified
mail addressed to Borrower at the address set forth in, or subsequently provided
by Borrower in accordance with, Section 11 of this Agreement and that service so
made shall be deemed completed upon the earlier to occur of Borrower’s actual
receipt thereof or three (3) days after deposit in the U.S. mails, proper
postage prepaid.

TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER, AGENT AND EACH
LENDER EACH WAIVE THEIR RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY
CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER
CLAIMS. THIS WAIVER IS A MATERIAL INDUCEMENT FOR ALL PARTIES TO ENTER INTO THIS
AGREEMENT.  EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.

WITHOUT INTENDING IN ANY WAY TO LIMIT THE PARTIES’ AGREEMENT TO WAIVE THEIR
RESPECTIVE RIGHT TO A TRIAL BY JURY, if the above waiver of the right to a trial
by jury is not enforceable, the parties hereto agree that any and all disputes
or controversies of any nature between them arising at any time shall be decided
by a reference to a private judge, mutually selected by the parties (or, if they
cannot agree, by the Presiding Judge of the Santa Clara County, California
Superior Court) appointed in accordance with California Code of Civil Procedure
Section 638 (or pursuant to comparable provisions of federal law if the dispute
falls within the exclusive jurisdiction of the federal courts), sitting without
a jury, in Santa Clara County, California; and the parties hereby

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submit to the jurisdiction of such court.  The reference proceedings shall be
conducted pursuant to and in accordance with the provisions of California Code
of Civil Procedure §§ 638 through 645.1, inclusive.  The private judge shall
have the power, among others, to grant provisional relief, including without
limitation, entering temporary restraining orders, issuing preliminary and
permanent injunctions and appointing receivers.  All such proceedings shall be
closed to the public and confidential and all records relating thereto shall be
permanently sealed.  If during the course of any dispute, a party desires to
seek provisional relief, but a judge has not been appointed at that point
pursuant to the judicial reference procedures, then such party may apply to the
Santa Clara County, California Superior Court for such relief.  The proceeding
before the private judge shall be conducted in the same manner as it would be
before a court under the rules of evidence applicable to judicial
proceedings.  The parties shall be entitled to discovery which shall be
conducted in the same manner as it would be before a court under the rules of
discovery applicable to judicial proceedings.  The private judge shall oversee
discovery and may enforce all discovery rules and orders applicable to judicial
proceedings in the same manner as a trial court judge.  The parties agree that
the selected or appointed private judge shall have the power to decide all
issues in the action or proceeding, whether of fact or of law, and shall report
a statement of decision thereon pursuant to California Code of Civil Procedure §
644(a).  Nothing in this paragraph shall limit the right of any party at any
time to exercise self-help remedies, foreclose against collateral, or obtain
provisional remedies.  The private judge shall also determine all issues
relating to the applicability, interpretation, and enforceability of this
paragraph.

 

This Section 12 shall survive the termination of this Agreement.

13GENERAL PROVISIONS

13.1Termination Prior to Maturity Date; Survival.  All covenants,
representations and warranties made in this Agreement continue in full force
until this Agreement has terminated pursuant to its terms and all Obligations
have been satisfied.  So long as Borrower has satisfied the Obligations (other
than inchoate indemnity obligations, any other obligations which, by their
terms, are to survive the termination of this Agreement, and any Obligations
under Bank Services Agreements that are cash collateralized in accordance with
Section 4.1 of this Agreement), this Agreement may be terminated prior to the
Growth Capital Maturity Date by Borrower, effective three (3) Business Days
after written notice of termination is given to Agent.  Those obligations that
are expressly specified in this Agreement as surviving this Agreement’s
termination shall continue to survive notwithstanding this Agreement’s
termination.  No termination of this Agreement shall in any way affect or impair
any right or remedy of Agent or any Lender, nor shall any such termination
relieve Borrower of any Obligation to any Lender, until all of the Obligations
(other than inchoate indemnification obligations) have been paid and performed
in full. Those Obligations that are expressly specified in this Agreement as
surviving this Agreement’s termination shall continue to survive notwithstanding
this Agreement’s termination and payment in full of the Obligations then
outstanding.

13.2Successors and Assigns.  This Agreement binds and is for the benefit of the
successors and permitted assigns of each party. Borrower may not assign this
Agreement or any rights or obligations under it without Agent and Lenders’ prior
written consent (which may be granted or withheld in Agent’s and Lenders’ sole
discretion). Agent and each Lender has the right, without the consent of or
notice to Borrower, to sell, transfer, assign, negotiate, or grant participation
in all or any part of, or any interest in, such Lender’s obligations, rights,
and benefits under this Agreement and the other Loan Documents (other than the
Warrant, as to which assignment, transfer and other such actions are governed by
the terms thereof).   

13.3Indemnification.  Borrower agrees to indemnify, defend and hold Agent, each
Lender and their respective directors, officers, employees, agents, attorneys,
or any other Person affiliated with or representing Agent or any Lender (each,
an “Indemnified Person”) harmless against: (i) all obligations, demands, claims,
and liabilities (collectively, “Claims”) claimed or asserted by any other party
in connection with the transactions contemplated by the Loan Documents; and (ii)
all losses or expenses (including Lenders’ Expenses) in any way suffered,
incurred, or paid by such Indemnified Person as a result of, following from,
consequential to, or arising from transactions between Agent, Lenders and
Borrower contemplated by the Loan Documents (including  reasonable attorneys’
fees and expenses),  except for Claims and/or losses directly caused by such
Indemnified Person’s gross negligence or willful misconduct.  This Section 13.3
shall survive until all statutes of limitation with respect to the Claims,
losses, and expenses for which indemnity is given shall have run.

13.4Time of Essence.  Time is of the essence for the performance of all
Obligations in this Agreement.

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13.5Severability of Provisions.  Each provision of this Agreement is severable
from every other provision in determining the enforceability of any provision.

13.6Correction of Loan Documents.  Agent may correct patent errors and fill in
any blanks in the Loan Documents consistent with the agreement of the parties.

13.7Amendments in Writing; Waiver; Integration.  No purported amendment or
modification of any Loan Document, or waiver, discharge or termination of any
obligation under any Loan Document, or release, or subordinate Lenders’ security
interest in, or consent to the transfer of, any Collateral shall be enforceable
or admissible unless, and only to the extent, expressly set forth in a writing
signed by Agent, with the consent of the Lenders in accordance with the Lender
Intercreditor Agreement or, if such item is not addressed in the Lender
Intercreditor Agreement, as consented to by a majority of the Lenders, and
Borrower.  Without limiting the generality of the foregoing, no oral promise or
statement, nor any action, inaction, delay, failure to require performance or
course of conduct shall operate as, or evidence, an amendment, supplement or
waiver or have any other effect on any Loan Document.  Any waiver granted shall
be limited to the specific circumstance expressly described in it, and shall not
apply to any subsequent or other circumstance, whether similar or dissimilar, or
give rise to, or evidence, any obligation or commitment to grant any further
waiver.  The Loan Documents represent the entire agreement about this subject
matter and supersede prior negotiations or agreements.  All prior agreements,
understandings, representations, warranties, and negotiations between the
parties about the subject matter of the Loan Documents merge into the Loan
Documents.  In the event any provision of any other Loan Document is
inconsistent with the provisions of this Agreement, the provisions of this
Agreement shall exclusively control.

13.8Counterparts.  This Agreement may be executed in any number of counterparts
and by different parties on separate counterparts, each of which, when executed
and delivered, is an original, and all taken together, constitute one Agreement.

13.9Confidentiality. Agent and each Lender agrees to maintain the
confidentiality of Information (as defined below), except that Information may
be disclosed (a) to Agent and/or any Lender’s subsidiaries or Affiliates, and
their respective employees, directors, investors, potential investors, agents,
attorneys, accountants and other professional advisors (collectively,
“Representatives” and, together with Agent and the Lenders, collectively,
“Lender Entities”); (b) to prospective transferees, assignees, credit providers
or purchasers of any Lender’s interests under or in connection with this
Agreement and their Representatives (provided, however, Lenders shall use their
best efforts to obtain any such prospective transferee’s, assignee’s, credit
provider’s, or purchaser’s or their Representatives’ agreement to the terms of
this provision); (c) as required by law, regulation, subpoena, or other order;
(d) to Agent’s or any Lender’s regulators or as otherwise required in connection
with Agent’s or any Lender’s examination or audit; (e) as Agent or any Lender
considers appropriate in exercising remedies under the Loan Documents; and (f)
to third-party service providers of Agent and/or any Lender so long as such
service providers have executed a confidentiality agreement with Agent or the
Lenders, as applicable, with terms no less restrictive than those contained
herein.  The term “Information” means all information received from Borrower
regarding Borrower or its business, in each case other than information that is
either: (i) in the public domain or in Agent’s or any Lender’s possession when
disclosed to Agent or such Lender, or becomes part of the public domain (other
than as a result of its disclosure by Agent or a Lender in violation of this
Agreement) after disclosure to Agent and/or the Lenders; or (ii) disclosed to
Agent and/or a Lender by a third party, if Agent or such Lender, as applicable,
does not know that the third party is prohibited from disclosing the
information.

Lender Entities may use anonymous forms of confidential information for
aggregate datasets, for analyses or reporting, and for any other uses not
expressly prohibited in writing by Borrower. The provisions of the immediately
preceding sentence shall survive termination of this Agreement.

13.10Attorneys’ Fees, Costs and Expenses.  In any action or proceeding between
Borrower and any Lender arising out of or relating to the Loan Documents, the
prevailing party shall be entitled to recover its reasonable attorneys’ fees and
other costs and expenses incurred, in addition to any other relief to which it
may be entitled.

13.11Right of Setoff.   Borrower hereby grants to Agent, for the ratable benefit
of the Lenders, a Lien, security interest, and a right of setoff as security for
all Obligations to Agent and the Lenders, whether now existing or hereafter
arising upon and against all deposits, credits, collateral and property, now or
hereafter in the possession,

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custody, safekeeping or control of Agent or any entity under the control of
Agent (including a subsidiary of Agent) or in transit to any of them.  At any
time after the occurrence and during the continuance of an Event of Default,
without demand or notice, Agent or any Lender may setoff the same or any part
thereof and apply the same to any Obligation of Borrower then due regardless of
the adequacy of any other collateral securing the Obligations.  ANY AND ALL
RIGHTS TO REQUIRE AGENT OR ANY LENDER TO EXERCISE ITS RIGHTS OR REMEDIES WITH
RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO
EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER
PROPERTY OF BORROWER, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

13.12Electronic Execution of Documents.  The words “execution,” “signed,”
“signature” and words of like import in any Loan Document shall be deemed to
include electronic signatures or the keeping of records in electronic form, each
of which shall be of the same legal effect, validity and enforceability as a
manually executed signature or the use of a paper-based recordkeeping systems,
as the case may be, to the extent and as provided for in any applicable law,
including, without limitation, any state law based on the Uniform Electronic
Transactions Act.  

13.13Captions.  The headings used in this Agreement are for convenience only and
shall not affect the interpretation of this Agreement.

13.14Construction of Agreement.  The parties mutually acknowledge that they and
their attorneys have participated in the preparation and negotiation of this
Agreement.  In cases of uncertainty this Agreement shall be construed without
regard to which of the parties caused the uncertainty to exist.

13.15Relationship.  The relationship of the parties to this Agreement is
determined solely by the provisions of this Agreement.  The parties do not
intend to create any agency, partnership, joint venture, trust, fiduciary or
other relationship with duties or incidents different from those of parties to
an arm’s-length contract.

13.16Third Parties.  Nothing in this Agreement, whether express or implied, is
intended to: (a) confer any benefits, rights or remedies under or by reason of
this Agreement on any persons other than the express parties to it and their
respective permitted successors and assigns; (b) relieve or discharge the
obligation or liability of any person not an express party to this Agreement; or
(c) give any person not an express party to this Agreement any right of
subrogation or action against any party to this Agreement.

13.17Patriot Act.  Each Lender hereby notifies Borrower that pursuant to the
requirements of the USA PATRIOT Act, it is required to obtain, verify and record
information that identifies Borrower and each of its Subsidiaries, which
information includes the names and addresses of each Borrower and each of its
Subsidiaries and other information that will allow Lender, as applicable, to
identify Borrower and each of its Subsidiaries in accordance with the USA
PATRIOT Act.

14DEFINITIONS

14.1Definitions.  As used in the Loan Documents, the word “shall” is mandatory,
the word “may” is permissive, the word “or” is not exclusive, the words
“includes” and “including” are not limiting, the singular includes the plural,
and numbers denoting amounts that are set off in brackets are negative.  As used
in this Agreement, the following capitalized terms have the following meanings:

“Account” is any “account” as defined in the Code or any other applicable law
with such additions to such term as may hereafter be made, and includes, without
limitation, all accounts receivable and other sums owing to Borrower.

“Account Debtor” is any “account debtor” as defined in the Code or any other
applicable law with such additions to such term as may hereafter be made.

“Affiliate” is, with respect to any Person, each other Person that owns or
controls directly or indirectly the Person, any Person that controls or is
controlled by or is under common control with the Person, and each of that

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Person’s senior executive officers, directors, partners and, for any Person that
is a limited liability company, that Person’s managers and members.

“Agent” is defined in the preamble hereof.

“Agreement” is defined in the preamble hereof.

“Amortization Start Date” is the first day of the first month following the end
of the Interest-Only Period.

“Authorized Signer” is any individual listed in Borrower’s Borrowing Resolution
who is authorized to execute the Loan Documents, including any Credit Extension
request, on behalf of Borrower.

“Bank Services”  are any products, credit services, and/or financial
accommodations previously, now, or hereafter provided to Borrower or any of its
Subsidiaries by SVB or any SVB Affiliate, including, without limitation, any
letters of credit, cash management services (including, without limitation,
merchant services, direct deposit of payroll, business credit cards, and check
cashing services), interest rate swap arrangements, and foreign exchange
services as any such products or services may be identified in SVB’s various
agreements related thereto (each, a “Bank Services Agreement”).

“Bank Services Agreement” is defined in the definition of Bank Services.

“Board” means Borrower’s board of directors.

“Borrower” is defined in the preamble hereof.

“Borrower’s Books” are all Borrower’s books and records including ledgers,
federal and state tax returns, records regarding Borrower’s assets or
liabilities, the Collateral, business operations or financial condition, and all
computer programs or storage or any equipment containing such information.

“Borrowing Resolutions” are, with respect to any Person, those resolutions
adopted by such Person’s board of directors (and, if required under the terms of
such Person’s Operating Documents, stockholders) and delivered by such Person to
Agent approving the Loan Documents to which such Person is a party and the
transactions contemplated thereby, together with a certificate executed by its
secretary on behalf of such Person certifying (a) such Person has the authority
to execute, deliver, and perform its obligations under each of the Loan
Documents to which it is a party, (b) that set forth as a part of or attached as
an exhibit to such certificate is a true, correct, and complete copy of the
resolutions then in full force and effect authorizing and ratifying the
execution, delivery, and performance by such Person of the Loan Documents to
which it is a party, (c) the name(s) of the Person(s) authorized to execute the
Loan Documents, including any Credit Extension request, on behalf of such
Person, together with a sample of the true signature(s) of such Person(s), and
(d) that Agent and Lenders may conclusively rely on such certificate unless and
until such Person shall have delivered to Agent and Lenders a further
certificate canceling or amending such prior certificate.

“Business Day” is any day that is not a Saturday, Sunday or a day on which Agent
is closed.

“Cash Equivalents” means (a) marketable direct obligations issued or
unconditionally guaranteed by the United States or any agency or any State
thereof having maturities of not more than one (1) year from the date of
acquisition; (b) commercial paper maturing no more than one (1) year after its
creation and having the highest rating from either Standard & Poor’s Ratings
Group or Moody’s Investors Service, Inc.; (c) SVB’s certificates of deposit
issued maturing no more than one (1) year after issue; and (d) money market
funds at least ninety-five percent (95%) of the assets of which constitute Cash
Equivalents of the kinds described in clauses (a) through (c) of this
definition.

“Change in Control” means (a) at any time, any “person” or “group” (as such
terms are used in Sections 13(d) and 14(d) of the Exchange Act), shall become,
or obtain rights (whether by means of warrants, options or otherwise) to become,
the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)‑5 under the
Exchange Act), directly or indirectly, of forty percent (40.0%) or more of the
ordinary voting power for the election of directors of

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Borrower (determined on a fully diluted basis) other than by the sale of
Borrower’s equity securities in a public offering or to venture capital or
private equity investors so long as Borrower identifies to the Agent and the
Lenders the venture capital or private equity investors at least seven (7)
Business Days prior to the closing of the transaction and provides to Agent and
the Lenders a description of the material terms of the transaction; (b) during
any period of twelve (12) consecutive months, a majority of the members of the
board of directors or other equivalent governing body of Borrower cease to be
composed of individuals (i) who were members of that board or equivalent
governing body on the first day of such period, (ii) whose election or
nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (i) and
(ii) above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body; or (c) at any time,
Borrower shall cease to own and control, of record and beneficially, directly or
indirectly, one hundred percent (100.0%) of each class of outstanding capital
stock of each Subsidiary of Borrower free and clear of all Liens (except Liens
created by this Agreement).

“Claims” is defined in Section 13.3.

“Code” is the Uniform Commercial Code, as the same may, from time to time, be
enacted and in effect in the State of California; provided, that, to the extent
that the Code is used to define any term herein or in any Loan Document and such
term is defined differently in different Articles or Divisions of the Code, the
definition of such term contained in Article or Division 9 shall govern;
provided further, that in the event that, by reason of mandatory provisions of
law, any or all of the attachment, perfection, or priority of, or remedies with
respect to, Agent’s Lien on any Collateral is governed by the Uniform Commercial
Code in effect in a jurisdiction other than the State of California, the term
“Code” shall mean the Uniform Commercial Code as enacted and in effect in such
other jurisdiction solely for purposes of the provisions thereof relating to
such attachment, perfection, priority, or remedies and for purposes of
definitions relating to such provisions.

“Collateral” is any and all properties, rights and assets of Borrower described
on Exhibit A attached hereto.

“Collateral Account” is any Deposit Account, Securities Account, or Commodity
Account.

“Commitment” and “Commitments” means the Growth Capital Commitment(s).

“Commodity Account” is any “commodity account” as defined in the Code or any
other applicable law with such additions to such term as may hereafter be made.

“Compliance Certificate” is that certain certificate in the form attached hereto
as Exhibit B.

“Contingent Obligation” is, for any Person, any direct or indirect liability,
contingent or not, of that Person for (a) any indebtedness, lease, dividend,
letter of credit or other obligation of another such as an obligation, in each
case, directly or indirectly guaranteed, endorsed, co‑made, discounted or sold
with recourse by that Person, or for which that Person is directly or indirectly
liable; (b) any obligations for undrawn letters of credit for the account of
that Person; and (c) all obligations from any interest rate, currency or
commodity swap agreement, interest rate cap or collar agreement, or other
agreement or arrangement designated to protect a Person against fluctuation in
interest rates, currency exchange rates or commodity prices; but “Contingent
Obligation” does not include endorsements in the ordinary course of
business.  The amount of a Contingent Obligation is the stated or determined
amount of the primary obligation for which the Contingent Obligation is made or,
if not determinable, the maximum reasonably anticipated liability for it
determined by the Person in good faith; but the amount may not exceed the
maximum of the obligations under any guarantee or other support arrangement.

“Control Agreement” is any control agreement entered into among the depository
institution at which Borrower maintains a Deposit Account or the securities
intermediary or commodity intermediary at which Borrower maintains a Securities
Account or a Commodity Account, Borrower, and Agent pursuant to which Agent
obtains control (within the meaning of the Code or any other applicable law) for
the benefit of the Lenders over such Deposit Account, Securities Account, or
Commodity Account.

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“Copyrights” are any and all copyright rights, copyright applications, copyright
registrations and like protections in each work of authorship and derivative
work thereof, whether published or unpublished and whether or not the same also
constitutes a trade secret.

“Credit Extension” is any Growth Capital Advance or any other extension of
credit by any Lender for Borrower’s benefit.

“Default Rate” is defined in Section 2.2(b).

“Defaulting Lender” is, subject to Section 10.10(b), any Lender that (a) has
failed to (i) fund all or any portion of its Growth Capital Advances within two
(2) Business Days of the date such Growth Capital Advances were required to be
funded hereunder unless such Lender notifies Agent and Borrower in writing that
such failure is the result of such Lender’s reasonable determination that one or
more conditions precedent to funding (each of which conditions precedent,
together with any applicable default, shall be specifically identified in such
writing) has not been satisfied, or (ii) pay to Agent or any other Lender any
other amount required to be paid by it hereunder within two (2) Business Days of
the date when due, (b) has notified Borrower or Agent in writing that it does
not intend to comply with its funding obligations hereunder, or has made a
public statement to that effect (unless such writing or public statement relates
to such Lender’s obligation to fund a Growth Capital Advance hereunder and
states that such position is based on such Lender’s reasonable determination
that a condition precedent to funding (which condition precedent, together with
any applicable default, shall be specifically identified in such writing or
public statement) cannot be satisfied), (c) has failed, within three (3)
Business Days after written request by Agent or Borrower, to confirm in writing
to Agent and Borrower that it will comply with its prospective funding
obligations hereunder (provided that such Lender shall cease to be a Defaulting
Lender pursuant to this clause (c) upon receipt of such written confirmation by
Agent and Borrower), or (d) has, or has a direct or indirect parent company that
has, (i) become the subject of an Insolvency Proceeding, or (ii) had appointed
for it a receiver, custodian, conservator, trustee, administrator, assignee for
the benefit of creditors or similar Person charged with reorganization or
liquidation of its business or assets, including the Federal Deposit Insurance
Corporation or any other state or federal regulatory authority acting in such a
capacity; provided that a Lender shall not be a Defaulting Lender solely by
virtue of the ownership or acquisition of any equity interest in that Lender or
any direct or indirect parent company thereof by a Governmental Authority so
long as such ownership interest does not result in or provide such Lender with
immunity from the jurisdiction of courts within the United States or from the
enforcement of judgments or writs of attachment on its assets or permit such
Lender (or such Governmental Authority) to reject, repudiate, disavow or
disaffirm any contracts or agreements made with such Lender.  Any determination
by Agent that a Lender is a Defaulting Lender under any one or more of clauses
(a) through (d) above shall be conclusive and binding absent manifest error, and
such Lender shall be deemed to be a Defaulting Lender (subject to Section
10.10(b)) upon delivery of written notice of such determination to Borrower and
each Lender.

“Deposit Account” is any “deposit account” as defined in the Code with such
additions to such term as may hereafter be made.

“Designated Deposit Account” is the multicurrency account denominated in
Dollars, account number XXXXXXXX254, maintained by Borrower with SVB (provided,
however, if no such account number is included, then the Designated Deposit
Account shall be any deposit account of Borrower maintained with SVB as chosen
by the Lenders).

“Disbursement Letter” is that certain form attached hereto as Exhibit E.

“Dollars,” “dollars” or use of the sign “$” means only lawful money of the
United States and not any other currency, regardless of whether that currency
uses the “$” sign to denote its currency or may be readily converted into lawful
money of the United States.

“Dollar Equivalent” is, at any time, (a) with respect to any amount denominated
in Dollars, such amount, and (b) with respect to any amount denominated in a
Foreign Currency, the equivalent amount therefor in Dollars as determined by
Agent at such time on the basis of the then-prevailing rate of exchange in San
Francisco, California, for sales of the Foreign Currency for transfer to the
country issuing such Foreign Currency.

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“Effective Date” is defined in the preamble hereof.

“Equipment” is all “equipment” as defined in the Code or any other applicable
law with such additions to such term as may hereafter be made, and includes
without limitation all machinery, fixtures, goods, vehicles (including motor
vehicles and trailers), and any interest in any of the foregoing.

“ERISA” is the Employee Retirement Income Security Act of 1974, and its
regulations.

“Event of Default” is defined in Section 8.

“Exchange Act” is the Securities Exchange Act of 1934, as amended.

“Federal Funds Effective Rate” means, for any day, the weighted average of the
rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by SVB from three federal
funds brokers of recognized standing selected by it.

“Final Payment” is a payment (in addition to and not in substitution for the
regular monthly payments of principal plus accrued interest) equal to the
original principal amount of each Growth Capital Advance extended by the Lenders
to Borrower hereunder multiplied by six percent (6.0%), due on the earliest to
occur of (a) the Growth Capital Maturity Date, (b) the payment in full of such
Growth Capital Advance, (c) as required by Section 2.1.1(d) or 2.1.1(e) or (d)
the termination of this Agreement.

“Foreign Currency” means lawful money of a country other than the United States.

“Funding Date” is any date on which a Credit Extension is made to or for the
account of Borrower which shall be a Business Day.

“FX Contract” is any foreign exchange contract by and between Borrower and SVB
under which Borrower commits to purchase from or sell to SVB a specific amount
of Foreign Currency on a specified date.

“GAAP” is generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other Person as
may be approved by a significant segment of the accounting profession, which are
applicable to the circumstances as of the date of determination.

“General Intangibles” is all “general intangibles” as defined in the Code or any
other applicable law in effect on the date hereof with such additions to such
term as may hereafter be made, and includes without limitation, all Intellectual
Property, claims, income and other tax refunds, security and other deposits,
payment intangibles, contract rights, options to purchase or sell real or
personal property, rights in all litigation presently or hereafter pending
(whether in contract, tort or otherwise), insurance policies (including without
limitation key man, property damage, and business interruption insurance),
payments of insurance and rights to payment of any kind.

“Governmental Approval” is any consent, authorization, approval, order, license,
franchise, permit, certificate, accreditation, registration, filing or notice,
of, issued by, from or to, or other act by or in respect of, any Governmental
Authority.

“Governmental Authority” is any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative functions of or
pertaining to government, any securities exchange and any self-regulatory
organization.

“Group Member” means Borrower and its Subsidiaries.

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“Growth Capital Advance” and “Growth Capital Advances” are defined in Section
2.1.1(a).

“Growth Capital Commitment” means, for any Lender, the obligation of such Lender
to make a Growth Capital Advance as and when available, up to the principal
amount shown on Schedule 1.1.  “Growth Capital Commitments” means the aggregate
amount of such commitments of all Lenders.

“Growth Capital Loan Commitment Percentage” means, as to any Lender at any time,
the percentage (carried out to the fourth decimal place) of the Growth Capital
Commitments represented by such Lender’s Growth Capital Commitment at such
time.  The initial Growth Capital Commitment Percentage of each Lender is set
forth opposite the name of such Lender on Schedule 1.1.

“Growth Capital Line” is a Growth Capital Advance or Growth Capital Advances in
an aggregate principal amount of up to Fifteen Million Dollars ($15,000,000).

“Growth Capital Maturity Date” means March 1, 2023.

“Indebtedness” is (a) indebtedness for borrowed money or the deferred price of
property or services, such as reimbursement and other obligations for surety
bonds and letters of credit, (b) obligations evidenced by notes, bonds,
debentures or similar instruments, (c) capital lease obligations, and (d)
Contingent Obligations.

“Indemnified Person” is defined in Section 13.3.

“Information” is defined in Section 13.9.

“Insolvency Proceeding” is any proceeding by or against any Person under the
United States Bankruptcy Code or any other bankruptcy or insolvency law,
including assignments for the benefit of creditors, compositions, extensions
generally with its creditors, or proceedings seeking reorganization,
arrangement, or other relief.

“Intellectual Property” means, with respect to any Person, all of such Person’s
right, title, and interest in and to the following:

(a)its Copyrights, Trademarks and Patents;

(b)any and all trade secrets and trade secret rights, including, without
limitation, any rights to unpatented inventions, know-how and operating manuals;

(c)any and all source code;

(d)any and all design rights which may be available to such Person;

(e)any and all claims for damages by way of past, present and future
infringement of any of the foregoing, with the right, but not the obligation, to
sue for and collect such damages for said use or infringement of the
Intellectual Property rights identified above; and

(f)all amendments, renewals and extensions of any of the Copyrights, Trademarks
or Patents.

“Interest-Only Period” is the period of time from the Effective Date through
December 31, 2019; provided, however, if Borrower achieves the Tranche C
Milestone, the Interest-Only Period shall automatically, and with no further
action required by the parties hereto, be extended to June 30, 2020.

“Inventory” is all “inventory” as defined in the Code or any other applicable
law in effect on the date hereof with such additions to such term as may
hereafter be made, and includes without limitation all merchandise, raw
materials, parts, supplies, packing and shipping materials, work in process and
finished products, including without limitation such inventory as is temporarily
out of Borrower’s custody or possession or in transit and including any returned
goods and any documents of title representing any of the above.

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“Investment” is any beneficial ownership interest in any Person (including
stock, partnership interest or other securities), and any loan, advance or
capital contribution to any Person.

“Key Person” is each of Borrower’s (a) Chief Executive Officer, who is Jonathan
Mow as of the Effective Date, (b) Chief Financial Officer, who is John Sharp as
of the Effective Date, and (c) Chief Medical Officer, who is John Lee as of the
Effective Date.

“Lender” and “Lenders” is defined in the preamble.

“Lender Entities” is defined in Section 13.9.

“Lender Intercreditor Agreement” is, collectively, any and all intercreditor
agreement, master arrangement agreement or similar agreement by and between
WestRiver and SVB, as each may be amended from time to time in accordance with
the provisions thereof.

“Lenders’ Expenses” are all of Agent’s and the Lenders’ audit fees and expenses,
costs, and expenses (including reasonable attorneys’ fees and expenses) for
preparing, amending, negotiating, administering, defending and enforcing the
Loan Documents (including, without limitation, those incurred in connection with
appeals or Insolvency Proceedings) or otherwise incurred with respect to
Borrower.

“Letter of Credit” is a standby or commercial letter of credit issued by SVB
upon request of Borrower based upon an application, guarantee, indemnity, or
similar agreement.

“Lien” is a claim, mortgage, deed of trust, levy, charge, pledge, security
interest or other encumbrance of any kind, whether voluntarily incurred or
arising by operation of law or otherwise against any property.

“Loan Documents” are, collectively, this Agreement and any schedules, exhibits,
certificates, notices, and any other documents related to this Agreement, the
Warrants, the Perfection Certificate, each Disbursement Letter, the Lender
Intercreditor Agreement, any Bank Services Agreement, any Control Agreement, any
subordination agreement, any note, or notes or guaranties executed by Borrower,
and any other present or future agreement by Borrower with or for the benefit of
Agent and the Lenders in connection with this Agreement or Bank Services, all as
amended, restated, or otherwise modified.

“Material Adverse Change” is: (a) a material impairment in the perfection or
priority of Agent’s, for the ratable benefit of the Lenders, Lien in the
Collateral or in the value of such Collateral; (b) a material adverse change in
the business, operations, or condition (financial or otherwise) of Borrower; or
(c) a material impairment of the prospect of repayment of any portion of the
Obligations.

“Monthly Financial Statements” is defined in Section 6.2(a).

“Obligations” are Borrower’s obligations to pay when due any debts, principal,
interest, fees, Lenders’ Expenses, the Final Payment, the Prepayment Premium,
and other amounts Borrower owes Agent or any Lender now or later, whether under
this Agreement, the other Loan Documents (other than the Warrant), or otherwise,
including, without limitation, all obligations relating to Bank Services, if
any, and including interest accruing after Insolvency Proceedings begin and
debts, liabilities, or obligations of Borrower assigned to Agent and/or the
Lenders, and to perform Borrower’s duties under the Loan Documents (other than
the Warrant).

“Operating Documents” are, for any Person, such Person’s formation documents, as
certified by the Secretary of State (or equivalent agency) of such Person’s
jurisdiction of organization on a date that is no earlier than thirty (30) days
prior to the Effective Date, and, (a) if such Person is a corporation, its
bylaws in current form, (b) if such Person is a limited liability company, its
limited liability company agreement (or similar agreement), and (c) if such
Person is a partnership, its partnership agreement (or similar agreement), each
of the foregoing with all current amendments or modifications thereto.

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“Patents” means all patents, patent applications and like protections including
without limitation improvements, divisions, continuations, renewals, reissues,
extensions and continuations-in-part of the same.

“Payment/Advance Form” is that certain form attached hereto as Exhibit C.

“Payment Date” is the first (1st) calendar day of each month.

“Perfection Certificate” is defined in Section 5.1.

“Permitted Indebtedness” is:

(a)Borrower’s Indebtedness to Agent and the Lenders under this Agreement and the
other Loan Documents;

(b)Indebtedness existing on the Effective Date which is shown on the Perfection
Certificate;

(c)Subordinated Debt;

(d)unsecured Indebtedness to trade creditors incurred in the ordinary course of
business;

(e)Indebtedness incurred as a result of endorsing negotiable instruments
received in the ordinary course of business;

(f)Indebtedness secured by Liens permitted under clauses (a) and (c) of the
definition of “Permitted Liens” hereunder;

(g)extensions, refinancings, modifications, amendments and restatements of any
items of Permitted Indebtedness (a) through (f) above; provided that the
principal amount thereof is not increased or the terms thereof are not modified
to impose more burdensome terms upon Borrower or its Subsidiary, as the case may
be.

“Permitted Investments” are:

(a)Investments (including, without limitation, Subsidiaries) existing on the
Effective Date which are shown on the Perfection Certificate;

(b)Investments consisting of Cash Equivalents;

(c)Investments consisting of the endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary course of
Borrower;

(d)Investments accepted in connection with Transfers permitted by Section 7.1;

(e)Investments consisting of the creation of a Subsidiary for the purpose of
consummating a merger transaction permitted by Section 7.3 of this Agreement,
which is otherwise a Permitted Investment;

(f)Investments (i) by Borrower in Subsidiaries not to exceed Fifty Thousand
Dollars ($50,000.00) in the aggregate in any fiscal year and (ii) by
Subsidiaries in other Subsidiaries not to exceed Fifty Thousand Dollars
($50,000.00) in the aggregate in any fiscal year or in Borrower;

(g)Investments consisting of (i) travel advances and employee relocation loans
and other employee loans and advances in the ordinary course of business, and
(ii) loans to employees, officers or directors relating to the purchase of
equity securities of Borrower or its Subsidiaries pursuant to employee stock
purchase plans or agreements approved by Borrower’s Board of Directors;

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(h)Investments (including debt obligations) received in connection with the
bankruptcy or reorganization of customers or suppliers and in settlement of
delinquent obligations of, and other disputes with, customers or suppliers
arising in the ordinary course of business; and

(i)Investments consisting of notes receivable of, or prepaid royalties and other
credit extensions, to customers and suppliers who are not Affiliates, in the
ordinary course of business; provided that this paragraph (i) shall not apply to
Investments of Borrower in any Subsidiary.

“Permitted Liens” are:

(a)Liens existing on the Effective Date which are shown on the Perfection
Certificate or arising under this Agreement and the other Loan Documents;

(b)Liens for taxes, fees, assessments or other government charges or levies,
either (i) not due and payable or (ii) being contested in good faith and for
which Borrower maintains adequate reserves on its Books, provided that no notice
of any such Lien has been filed or recorded under the Internal Revenue Code of
1986, as amended, and the Treasury Regulations adopted thereunder;

(c)purchase money Liens (i) on Equipment acquired or held by Borrower incurred
for financing the acquisition of the Equipment securing no more than Two Hundred
Fifty Thousand Dollars ($250,000.00) in the aggregate amount outstanding, or
(ii) existing on Equipment when acquired, if the Lien is confined to the
property and improvements and the proceeds of the Equipment;

(d)Liens of carriers, warehousemen, suppliers, or other Persons that are
possessory in nature arising in the ordinary course of business so long as such
Liens attach only to Inventory, securing liabilities in the aggregate amount not
to exceed Two Hundred Fifty Thousand Dollars ($250,000.00), and which are not
delinquent or remain payable without penalty or which are being contested in
good faith and by appropriate proceedings which proceedings have the effect of
preventing the forfeiture or sale of the property subject thereto;

(e)Liens arising from attachments or judgments, orders, or decrees in
circumstances not constituting an Event of Default under Sections 8.4 and 8.7;
and

(f)Liens incurred in the extension, renewal or refinancing of the indebtedness
secured by Liens described in (a) through (d), but any extension, renewal or
replacement Lien must be limited to the property encumbered by the existing Lien
and the principal amount of the indebtedness may not increase.

“Person” is any individual, sole proprietorship, partnership, limited liability
company, joint venture, company, trust, unincorporated organization,
association, corporation, institution, public benefit corporation, firm, joint
stock company, estate, entity or government agency.

“Prepayment Premium” shall be an additional fee, payable to Agent, for the
ratable benefit of the Lenders based on their Pro Rata Share, with respect to
the Growth Capital Advances, in an amount equal to:

(a)for a prepayment of the Growth Capital Advances made on or prior to the first
(1st) anniversary of the Effective Date, three percent (3.0%) of the then
outstanding principal amount of the Growth Capital Advances immediately prior to
the date of such prepayment;

(b)for a prepayment of the Growth Capital Advances made after the first (1st)
anniversary of the Effective Date, but on or prior to the second (2nd)
anniversary of the Effective Date, two percent (2.0%) of the then outstanding
principal amount of the Growth Capital Advances immediately prior to the date of
such prepayment; and

(c)for a prepayment of the Growth Capital Advances made after the second (2nd)
anniversary of the Effective Date, but prior to the Growth Capital Maturity
Date, one percent (1.0%) of the then outstanding principal amount of the Growth
Capital Advances immediately prior to the date of such prepayment.

“Prime Rate” is the rate of interest per annum from time to time published in
the money rates section of The Wall Street Journal or any successor publication
thereto as the “prime rate” then in effect; provided that, in the event

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such rate of interest is less than zero, such rate shall be deemed to be zero
for purposes of this Agreement; and provided further that if such rate of
interest, as set forth from time to time in the money rates section of The Wall
Street Journal, becomes unavailable for any reason as determined by Agent, the
“Prime Rate” shall mean the rate of interest per annum announced by SVB as its
prime rate in effect at its principal office in the State of California (such
SVB announced Prime Rate not being intended to be the lowest rate of interest
charged by SVB in connection with extensions of credit to debtors); provided
that, in the event such rate of interest is less than zero, such rate shall be
deemed to be zero for purposes of this Agreement.

“Pro Rata Share” is, as of any date of determination, with respect to each
Lender, a percentage (expressed as a decimal, rounded to the ninth decimal
place) determined by dividing the outstanding principal amount of Growth Capital
Advances held by such Lender by the aggregate outstanding principal amount of
all Growth Capital Advances.

“Registered Organization” is any “registered organization” as defined in the
Code or any other applicable law with such additions to such term as may
hereafter be made.

“Removal Effective Date” is defined in Section 10.10(d).

“Repayment Schedule” means the period of time equal to thirty-nine (39)
consecutive months; provided, however, upon the occurrence of the Tranche C
Milestone, the Repayment Schedule shall mean the period of time equal to
thirty-three (33) consecutive months.

“Representatives” is defined in Section 13.9.

“Requirement of Law” is as to any Person, the organizational or governing
documents of such Person, and any law (statutory or common), treaty, rule or
regulation or determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject.

“Responsible Officer” is any of the Chief Executive Officer, President and Chief
Financial Officer of Borrower.  

“Restricted License” is any material license or other agreement with respect to
which Borrower is the licensee (a) that prohibits or otherwise restricts
Borrower from granting a security interest in, or a fixed or floating charge
over, Borrower’s interest in such license or agreement or any other property, or
(b) for which a default under or termination of could interfere with the Agent’s
right to sell any Collateral.

“SEC” shall mean the Securities and Exchange Commission, any successor thereto,
and any analogous Governmental Authority.

“Securities Account” is any “securities account” as defined in the Code or any
other applicable law with such additions to such term as may hereafter be made.

“Subordinated Debt” is indebtedness incurred by Borrower subordinated to all of
Borrower’s now or hereafter indebtedness to Agent and the Lenders (pursuant to a
subordination, intercreditor, or other similar agreement in form and substance
satisfactory to Agent and the Lenders, entered into between Agent, the Lenders
and the other creditor), on terms acceptable to Agent and the Lenders.

“Subsidiary” is, as to any Person, a corporation, partnership, limited liability
company or other entity of which shares of stock or other ownership interests
having ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency) to elect a
majority of the board of directors or other managers of such corporation,
partnership or other entity are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or more intermediaries,
or both, by such Person.  Unless the context otherwise requires, each reference
to a Subsidiary herein shall be a reference to a Subsidiary of Borrower.

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“SVB” is defined in the preamble hereof.

“SVB Loan Agreement” means that certain Loan and Security Agreement dated as of
October 18, 2017 between Borrower and Bank as amended, modified, supplemented
and/or restated from time to time.

“Trademarks” means any trademark and servicemark rights, whether registered or
not, applications to register and registrations of the same and like
protections, and the entire goodwill of the business of Borrower connected with
and symbolized by such trademarks.

“Tranche A” is defined in Section 2.1.1(a) hereof.

“Tranche A Growth Capital Advance” is defined in Section 2.1.1(a).

“Tranche B” is defined in Section 2.1.1(a) hereof.

“Tranche B Draw Period” is the period of time from the Effective Date through
May 31, 2019.

“Tranche B Growth Capital Advance” is defined in Section 2.1.1(a).

“Tranche C” is defined in Section 2.1.1(a) hereof.

“Tranche C Growth Capital Advance” is defined in Section 2.1.1(a).

“Tranche C Milestone” means (i) Borrower has requested and the Lenders have made
the Tranche B Growth Capital Advance to Borrower, and (ii) Borrower delivers to
the Lenders evidence, in form and substance satisfactory to the Lenders in their
sole discretion, confirming that Borrower has received FDA clearance to initiate
its Phase 3 clinical trial for PB2452.

“Transfer” is defined in Section 7.1.

“Warrant” means, collectively, (i) that certain Warrant to Purchase Stock dated
as of October 18, 2017 issued by Borrower in favor of SVB, (ii) that certain
Warrant to Purchase Stock dated as of the Effective Date issued by Borrower in
favor of SVB, (iii) that certain Warrant to Purchase Stock dated as of the
Effective Date issued by Borrower in favor of WestRiver and (iv) any other
warrant to purchase stock issued by Borrower to SVB or WestRiver heretofore or
hereafter, in each case as may be amended, modified, supplemented and/or
restated from time to time.

“WestRiver” is defined in the preamble hereof.

[Signature page follows.]

 

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

 

BORROWER:

 

PHASEBIO PHARMACEUTICALS, INC.

 

 

 

By

 

/s/ Jonathan P. Mow

Name:

 

Jonathan P. Mow

Title:

 

CEO

 

 

 

AGENT:

 

 

 

SILICON VALLEY BANK, as Agent

 

 

 

By

 

/s/ Myron O. Jensen

Name:

 

Myron O. Jensen

Title:

 

Vice President

 

 

 

LENDERS:

 

 

 

SILICON VALLEY BANK, as Lender

 

 

 

By

 

/s/ Myron O. Jensen

Name:

 

Myron O. Jensen

Title:

 

Vice President

 

 

 

WESTRIVER INNOVATION LENDING FUND VIII, L.P, as Lender

 

 

 

By

 

/s/ Trent Dawson

Name:

 

Trent Dawson

Title:

 

Chief Financial Officer

 

 

 

[Signature Page to Loan and Security Agreement]

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SCHEDULE 1.1

 

LENDERS AND GROWTH CAPITAL COMMITMENTS

 

Lender

Tranche A Loan Advance Commitment

Tranche A Loan Advance Commitment Percentage

Silicon Valley Bank

$3,750,000.00

50.0000%

WestRiver Innovation Lending Fund VIII, L.P.

$3,750,000.00

50.0000%

TOTAL

$7,500,000.00

100.0000%

 

Lender

Tranche B Loan Advance Commitment

Tranche B Loan Advance Commitment Percentage

Silicon Valley Bank

$1,250,000.00

50.0000%

WestRiver Innovation Lending Fund VIII, L.P.

$1,250,000.00

50.0000%

TOTAL

$2,500,000.00

100.0000%

 

Lender

Tranche C Loan Advance  Commitment

Tranche C Loan Advance Commitment Percentage

Silicon Valley Bank

$2,500,000.00

50.0000%

WestRiver Innovation Lending Fund VIII, L.P.

$2,500,000.00

50.0000%

TOTAL

$5,000,000.00

100.0000%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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EXHIBIT A

 

The Collateral consists of all of Borrower’s right, title and interest in and to
the following personal property:

 

All goods, Accounts (including health-care receivables), Equipment, Inventory,
contract rights or rights to payment of money, leases, license agreements,
franchise agreements, General Intangibles (except as provided below), commercial
tort claims, documents, instruments (including any promissory notes), chattel
paper (whether tangible or electronic), cash, deposit accounts, certificates of
deposit, fixtures, letters of credit rights (whether or not the letter of credit
is evidenced by a writing), securities, and all other investment property,
supporting obligations, and financial assets, whether now owned or hereafter
acquired, wherever located; and

 

all Borrower’s Books relating to the foregoing, and any and all claims, rights
and interests in any of the above and all substitutions for, additions,
attachments, accessories, accessions and improvements to and replacements,
products, proceeds and insurance proceeds of any or all of the foregoing.

 

Notwithstanding the foregoing, the Collateral does not include any Intellectual
Property; provided, however, the Collateral shall include all Accounts and all
proceeds of Intellectual Property.  If a judicial authority (including a U.S.
Bankruptcy Court) would hold that a security interest in the underlying
Intellectual Property is necessary to have a security interest in such Accounts
and such property that are proceeds of Intellectual Property, then the
Collateral shall automatically, and effective as of the Effective Date, include
the Intellectual Property to the extent necessary to permit perfection of
Agent’s, for the ratable benefit of the Lenders, security interest in such
Accounts and such other property of Borrower that are proceeds of the
Intellectual Property.

 

Pursuant to the terms of a certain negative pledge arrangement with Agent and
the Lenders, Borrower has agreed not to encumber any of its Intellectual
Property without Agent and the Lenders’ prior written consent.

 

 

 

 

 

 

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EXHIBIT B

COMPLIANCE CERTIFICATE

TO:

SILICON VALLEY BANK, as Agent, SVB and WESTRIVER as Lenders

FROM:

PHASEBIO PHARMACEUTICALS, INC., a Delaware corporation

DATE:

 

 

 

The undersigned authorized officer of PHASEBIO PHARMACEUTICALS, INC.
(“Borrower”) certifies that under the terms and conditions of the Loan and
Security Agreement among Borrower, SVB, and WestRiver (as amended, the “Loan
Agreement”), (1) Borrower is in complete compliance for the period ending
_______________ with all required covenants except as noted below, (2) there are
no Events of Default, (3) all representations and warranties in the Agreement
are true and correct in all material respects on this date except as noted
below; provided, however, that such materiality qualifier shall not be
applicable to any representations and warranties that already are qualified or
modified by materiality in the text thereof; and provided, further that those
representations and warranties expressly referring to a specific date shall be
true, accurate and complete in all material respects as of such date, (4)
Borrower, and each of its Subsidiaries, has timely filed all required tax
returns and reports, and Borrower has timely paid all foreign, federal, state
and local taxes, assessments, deposits and contributions owed by Borrower except
as otherwise permitted pursuant to the terms of Section 5.8 of the Agreement,
and (5) no Liens have been levied or claims made against Borrower or any of its
Subsidiaries relating to unpaid employee payroll or benefits of which Borrower
has not previously provided written notification to Agent.  Attached are the
required documents supporting the certification.  The undersigned certifies that
these are prepared in accordance with GAAP consistently applied from one period
to the next except as explained in an accompanying letter or footnotes.  The
undersigned acknowledges that no borrowings may be requested at any time or date
of determination that Borrower is not in compliance with any of the terms of the
Agreement, and that compliance is determined not just at the date this
certificate is delivered.  Capitalized terms used but not otherwise defined
herein shall have the meanings given them in the Agreement.

Please indicate compliance status by circling Yes/No under “Complies” column.

 

Reporting Covenants

Required

Complies

 

 

 

Monthly financial statements with
Compliance Certificate

Monthly within 30 days

 

Yes   No

Annual financial statement (CPA Audited)

FYE within 150 days

 

Yes   No

10‑Q, 10‑K and 8-K

Within 5 days after filing with SEC

 

Yes   No

Board Projections

At least annually and within 60 days of FYE, and as amended/updated by Board
approval

 

Yes   No

 

Other Matters

 

Have there been any amendments of or other changes to the capitalization table
of Borrower and to the Operating Documents of Borrower or any of its
Subsidiaries?  If yes, provide copies of any such amendments or changes with
this Compliance Certificate.

Yes

No

 

The following are the exceptions with respect to the certification above: (If no
exceptions exist, state “No exceptions to note.”)

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

 

PHASEBIO PHARMACEUTICALS, INC.

 

SVB USE ONLY

 

 

 

 

 

 

 

 

 

 

 

Received by:

 

 

By:

 

 

 

 

 

authorized signer

Name:

 

 

 

Date:

 

 

Title:

 

 

 

 

 

 

 

 

 

 

Verified:

 

 

 

 

 

 

 

 

authorized signer

 

 

 

 

Date:

 

 

 

 

 

 

 

 

 

 

 

 

 

Compliance Status:

 

Yes

No

 

 

 

 

--------------------------------------------------------------------------------

 

EXHIBIT C

LOAN PAYMENT/ADVANCE REQUEST FORM

 

Fax To:

 

 

 

Date:

 

 

 

Loan Payment:

PHASEBIO PHARMACEUTICALS, INC.

 

 

 

 

 

 

 

 

From Account #

 

 

To Account #

 

 

 

(Deposit Account #)

 

 

(Loan Account #)

 

Principal $

 

 

and/or Interest $

 

 

 

 

 

 

 

 

Authorized Signature:

 

 

Phone Number:

 

 

Print Name/Title:

 

 

 

 

 

 

 

 

 

 

 

 

Loan Advance:

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

From Account #

 

 

To Account #

(Deposit Account #)

 

 

(Loan Account #)

 

 

 

 

 

 

 

 

 

 

Amount of Growth Capital Advance $

 

 

 

 

 

 

 

 

 

All Borrower’s representations and warranties in the Loan and Security Agreement
are true, correct and complete on the date of the request for an advance:

 

 

 

Authorized Signature:

 

 

Phone Number:

 

 

Print Name/Title:

 

 

 

 

 

 

 

 

 

 

 

 

Outgoing Wire Request:

 

 

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

 

Deadline for same day processing is noon, Eastern Time

 

 

 

 

 

 

 

Beneficiary Name:

 

 

Amount of Wire: $

 

 

Beneficiary Bank:

 

 

Account Number:

 

 

City and State:

 

 

 

 

 

 

 

 

 

 

 

Beneficiary Bank Transit (ABA) #:

 

 

Beneficiary Bank Code (Swift, Sort, Chip, etc.):

 

 

 

 

 

(For International Wire Only)

 

 

 

 

 

 

 

 

Intermediary Bank:

 

 

Transit (ABA) #:

 

 

For Further Credit to:

 

 

 

 

 

 

 

 

Special Instruction:

 

 

 

 

 

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

 

 

 

Authorized Signature:

 

 

2nd Signature (if required):

 

 

Print Name/Title:

 

 

Print Name/Title:

 

 

Telephone #:

 

 

Telephone #:

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

EXHIBIT D

BORROWING RESOLUTIONS

 

[gf0dszwptepi000001.jpg]

 

CORPORATE BORROWING certificatE

 

 

Borrower:

PHASEBIO PHARMACEUTICALS, INC.

Date:

March 25, 2019

Lenders:

SILICON VALLEY BANK (“Bank”) and

 

WESTRIVER INNOVATION LENDING FUND VIII, L.P.

 

I hereby certify as follows, as of the date set forth above:

 

1.I am the Secretary, Assistant Secretary or other officer of Borrower.   My
title is as set forth below.

 

2.Borrower’s exact legal name is set forth above.  Borrower is a corporation
existing under the laws of the State of Delaware.  

 

3.Attached hereto are true, correct and complete copies of Borrower’s
Certificate of Incorporation (including amendments), as filed with the Secretary
of State of the state in which Borrower is incorporated as set forth
above.  Such Certificate of Incorporation have not been amended, annulled,
rescinded, revoked or supplemented, and remain in full force and effect as of
the date hereof.  

 

4.The following resolutions were duly and validly adopted by Borrower’s Board of
Directors at a duly held meeting of such directors (or pursuant to a unanimous
written consent or other authorized corporate action).  Such resolutions are in
full force and effect as of the date hereof and have not been in any way
modified, repealed, rescinded, amended or revoked, and the Lenders may rely on
them until the Lenders receive written notice of revocation from Borrower.

 

Resolved, that any one of the following officers or employees of Borrower, whose
names, titles and signatures are below, may act on behalf of Borrower:

 

Name

 

Title

 

Signature

 

Authorized to Add or Remove Signatories

 

 

 

 

 

 

 

 

 

 

 

 

 

☐

 

 

 

 

 

 

☐

 

 

 

 

 

 

☐

 

 

 

 

 

 

☐

 

Resolved Further, that any one of the persons designated above with a checked
box beside his or her name may, from time to time, add or remove any individuals
to and from the above list of persons authorized to act on behalf of Borrower.

WEST\277485036.4
354271-000840

--------------------------------------------------------------------------------

 

 

Resolved Further, that such individuals may, on behalf of Borrower:

 

Borrow Money.  Borrow money from Lenders.

Execute Loan Documents.  Execute any loan documents the Lenders require.

Grant Security.  Grant the Lenders a security interest in any of Borrower’s
assets.

Negotiate Items.  Negotiate or discount all drafts, trade acceptances,
promissory notes, or other indebtedness in which Borrower has an interest and
receive cash or otherwise use the proceeds.

Apply for Letters of Credit.  Apply for letters of credit from Bank.

Enter Derivative Transactions.  Execute spot or forward foreign exchange
contracts, interest rate swap agreements, or other derivative transactions with
Bank.

Issue Warrants.  Issue warrants for Borrower’s capital stock.

Further Acts.  Designate other individuals to request advances, pay fees and
costs and execute other documents or agreements (including documents or
agreement that waive Borrower’s right to a jury trial) they believe to be
necessary to effect these resolutions.

 

Resolved Further, that all acts authorized by the above resolutions and any
prior acts relating thereto are ratified.

 

5.The persons listed above are Borrower's officers or employees with their
titles and signatures shown next to their names.

 

PHASEBIO PHARMACEUTICALS, INC.

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

*** If the Secretary, Assistant Secretary or other certifying officer executing
above is designated by the resolutions set forth in paragraph 4 as one of the
authorized signing officers, this Certificate must also be signed by a second
authorized officer or director of Borrower.

 

 

I, the                                    of Borrower, hereby certify as to
paragraphs 1 through 5 above, as of the date set forth above.

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

WEST\277485036.4
354271-000840

--------------------------------------------------------------------------------

 

 

Exhibit E

Form of Disbursement Letter

[see attached]

 

--------------------------------------------------------------------------------

 

DISBURSEMENT LETTER

[DATE]

The undersigned, being the duly elected and acting
                                  of PHASEBIO PHARMACEUTICALS, INC., a Delaware
corporation (“Borrower”) does hereby certify to (a) SILICON VALLEY BANK, a
California corporation (“SVB”), in its capacity as administrative agent and
collateral agent (“Agent”), (b) SILICON VALLEY BANK, a California corporation,
as a lender, (c) WESTRIVER INNOVATION LENDING FUND VIII, L.P., a Delaware
limited partnership (“WestRiver”), as a lender (SVB and WestRiver and each of
the other “Lenders” from time to time a party hereto are referred to herein
collectively as the “Lenders” and each individually as a “Lender”) in connection
with that certain Loan and Security Agreement dated as of March 25, 2019, by and
among Borrower, Agent and the Lenders from time to time party thereto (the “Loan
Agreement”; with other capitalized terms used below having the meanings ascribed
thereto in the Loan Agreement) that:

1.

The representations and warranties made by Borrower in Section 5 of the Loan
Agreement and in the other Loan Documents are true and correct in all material
respects as of the date hereof.

 

2.

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

 

3.

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

 

4.

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

 

5.

No Material Adverse Change has occurred.

 

6.

The undersigned is an Authorized Signer.

 

 

[Balance of Page Intentionally Left Blank]

 

 

--------------------------------------------------------------------------------

 

7.

The proceeds of the Growth Capital Advance shall be disbursed as follows:

 

Disbursement from SVB:

 

 

Loan Amount

$

 

Plus:

 

 

--Deposit Received

$

 

 

 

 

Less:

 

 

--Agent’s Legal Fees

$

(                          )

 

 

 

Net Proceeds due from SVB:

$

 

 

 

 

Disbursement from WestRiver:

 

 

Loan Amount

$

 

Plus:

 

 

--Deposit Received

$

 

 

 

 

Less:

 

 

‑‑Lender’s Legal Fees

$

(                          )

 

 

 

Net Proceeds due from WestRiver:

$

 

 

 

 

TOTAL GROWTH CAPITAL ADVANCE NET PROCEEDS FROM LENDERS

$

 

 

 

 

 

 

 

 

8.

The aggregate net proceeds of the Growth Capital Advance shall be transferred to
the Designated Deposit Account as follows:

 

Account Name:

Phasebio Pharmaceuticals, Inc.

Bank Name:

Silicon Valley Bank

Bank Address:

3003 Tasman Drive
Santa Clara, California 95054

Account Number:

 

 

ABA Number:

 

 

 

 

 

[Balance of Page Intentionally Left Blank]

 

 

--------------------------------------------------------------------------------

 

Dated as of the date first set forth above.

 

BORROWER:

 

 

 

 

 

PHASEBIO PHARMACEUTICALS, INC.

 

 

 

 

 

 

 

 

By

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

AGENT AND LENDER:

 

 

 

 

 

SILICON VALLEY BANK

 

 

 

 

 

 

 

 

By

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

LENDER:

 

 

 

 

 

SILICON VALLEY BANK

 

 

 

 

 

 

 

 

By

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

LENDER:

 

 

 

 

 

WESTRIVER INNOVATION LENDING FUND VIII, L.P.

 

 

 

 

 

 

 

 

By

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

 

[Signature Page to Disbursement Letter]

--------------------------------------------------------------------------------

 

ANNEX I

 

Form of Warrant

 

[see attached]

 

 

 

--------------------------------------------------------------------------------

 

 

[gf0dszwptepi000002.jpg]

MARKETING CONSENT FORM

 

Marketing Consent Form

SVB Financial Group is proud of our business relationships and occasionally
likes to promote these relationships. We would like to use your company’s
information and logo for promotional and marketing purposes in SVB Financial
Group member businesses (collectively “SVB”) materials. While we would
appreciate your consent to all of the uses listed below, please review and
select all of the uses that you consent to below.

 

Approved Use(s)

 

 

Indicate your selection(s) by checking the boxes below

 

☐

Marketing: You consent to SVB’s use of Company’s name, logo and images provided
to us in written and oral presentations, advertising, marketing and PR
materials, professional lists and websites.

 

 

☐

Deal Terms: You consent to SVB’s inclusion of the size and type of any loan or
credit facility alongside your company’s name in any oral presentations,
advertising, marketing and PR materials, customer lists, and websites.

 

 

☐

Reference: You consent to SVB’s use of Company and representatives’ names as a
reference for SVB.

 

 

☐

Testimonial: You consent to SVB’s use of Company and representatives’ names and
quotations in written and oral presentations, marketing and PR materials, and
websites. Our practice is to send you a draft of any quotation concerning
Company prior to publishing.

 

 

☐

News release: You consent to SVB’s use of Company’s name, trademarks, service
marks, quotations and images provided to us in the SVB’s news releases
concerning Company. Our practice is to send you a draft of any news release
concerning Company prior to publishing.

 

 

Logos

 

 

 

In order to maintain the integrity of your logos, please provide them in:

‣ Full color and black and white versions, with or without taglines

‣ At least 300 dpi in PNG, EPS, TIF, or JPG formats (please do not send PDF or
website logos).

 

Names

 

 

Please make sure to print the Company name, and any individual names and titles
as you would like them displayed in materials or lists.

 

Company name

PHASEBIO PHARMACEUTICALS, INC.

Additional names

 

 

You grant to SVB a limited license to use the information for the limited
purposes above, which you can revoke upon written notice to SVB. The signer
below acknowledges that he or she has authority to bind the Company to this
consent. SVB will not be responsible for versions that were printed prior to
receiving notice revoking any such consent. Company is solely responsible for
defense and maintenance of its intellectual property.

Please contact your Relationship Advisor or SVB representative if you have any
questions.

 

Accepted or Agreed on Behalf Of Company or Yourself

Name

 

Title

 

 

 

Signature

 

Today’s date

MARCH 25, 2019

 

 

Address

 

Phone number

 

Email

 

 

 

 

Return this completed form and any attachments to your Relationship Advisor or
SVB via email at logo@svb.com.

©2014 SVB Financial Group. All rights reserved. Silicon Valley Bank is a member
of FDIC and Federal Reserve System. SVB>, SVB>Find a way, SVB Financial Group,
and Silicon Valley Bank are registered trademarks. B_SAM-14-13427 rev. 06-25-14.