Exhibit 10.1

Execution Version

AMENDMENT NO. 3 TO CREDIT, SECURITY AND GUARANTY AGREEMENT

 

THIS AMENDMENT NO. 3 TO CREDIT, SECURITY AND GUARANTY AGREEMENT (this
“Agreement”) is made as of this 5th day of August, 2016 (the “Effective Date”),
by and among quotient biodiagnostics, inc., a Delaware corporation (the
“Borrower”), the other Credit Parties listed on the signature pages hereof,
MIDCAP FINANCIAL TRUST, a Delaware statutory trust, as administrative agent
(together with its successors and assigns, the “Agent”), and the other financial
institutions or other entities from time to time parties to the Credit Agreement
referenced below, each as a Lender.

 

RECITALS

 

A.Pursuant to that certain Amended and Restated Credit, Security and Guaranty
Agreement, dated as of August 3, 2015 (as amended and supplemented by that
certain Amendment No. 1 and Joinder to Credit, Security and Guaranty Agreement
and Amendment No. 2 Credit, Security and Guaranty Agreement, dated September 24,
2015, the “Original Credit Agreement” and as the same is amended hereby and as
it may be hereafter amended, restated, supplemented or otherwise modified from
time to time, the “Credit Agreement”), by and among the Borrower, Quotient
Limited, a company incorporated under the laws of Jersey, Alba Bioscience
Limited, a company incorporated in Scotland, Quotient Biocampus Limited, a
company incorporated in Scotland, QBD (QS IP) Limited, a company incorporated
under the laws of Jersey, Quotient Suisse SA, a company formed under the laws of
Switzerland, each as a Guarantor, the Agent and the Lenders, the Lenders agreed
to make available to Borrower term loans in an aggregate amount of
$50,000,000.  Capitalized terms used but not otherwise defined in this
Agreement, including in these Recitals, shall have the meanings set forth in the
Credit Agreement.

 

B.The Credit Parties have requested, and Agent and Lenders have agreed, to amend
the Original Credit Agreement to, among other things, revise certain conditions
precedent to the funding of Credit Facility #2 and to delete the financial
covenant formerly contained in Section 8.2(b) of the Original Credit Agreement,
all in accordance with the terms and subject to the conditions set forth herein.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing, the terms and conditions set
forth in this Agreement, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto hereby
agree as follows:

 

1.Recitals.   This Agreement shall constitute a Financing Document and the
Recitals set forth above shall be construed as part of this Agreement as if set
forth fully in the body of this Agreement.

 

 

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2.Amendments to Credit Agreement.

 

(a)The following definitions of “Third Amendment” and “Third Amendment Effective
Date” are hereby added to Section 16 of the Original Credit Agreement in the
appropriate alphabetical order therein:

“Third Amendment” shall mean that certain Amendment No. 3 to Credit, Security
and Guaranty Agreement, dated as of August _5_, 2016, by and among Borrower, the
other Credit Parties party thereto and Agent.

“Third Amendment Effective Date” shall mean the first date that all of the
conditions in Section 4 of the Third Amendment are satisfied.

(b)Section 8.2(b) of the Original Credit Agreement is hereby deleted in its
entirety and replaced with the word “RESERVED” and all references to Section
8.2(b), including references in the Compliance Certificate and the other
Financing Documents are hereby deleted.

(c)The Credit Facility Schedule to the Original Credit Agreement is hereby
deleted in its entirety and replaced with Exhibit A attached hereto.

3.Representations and Warranties; Reaffirmation of Security Interest.  Each
Credit Party represents and warrants to Agent and Lenders that, before and after
giving effect to this Agreement:

(a)All representations and warranties of the Credit Parties contained in the
Financing Documents were true and correct in all respects when made and, except
to the extent that such representations and warranties relate expressly to an
earlier date, continue to be true and correct in all respects on the date
hereof;

(b)The execution and delivery by each Credit Party of this Agreement and the
performance by it of the transactions herein contemplated (i) are and will be
within its powers, (ii) have been authorized by all necessary action (corporate
or otherwise), and (iii) are not and will not be in contravention of any order
of any court or other agency of government, of law or any other indenture,
agreement or undertaking to which such Credit Party is a party or by which the
property of such Credit Party  is bound, or be in conflict with, result in a
breach of, or constitute (with due notice and/or lapse of time) a default under
any such indenture, agreement or undertaking or result in the imposition of any
lien, charge or encumbrance of any nature on any of the properties of such
Credit Party;

(c)This Agreement and any instruments, documents, and agreements executed and
delivered in connection herewith, are and will be valid, binding, and
enforceable against each Credit Party that is a party thereto in accordance with
their respective terms; and  

(d)Each Credit Party confirms and agrees that all security interests and Liens
granted to Agent continue in full force and effect, and all Collateral remains
free and clear of any Liens, other than those granted to Agent and Permitted
Liens.  Nothing

 

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herein is intended to impair or limit the validity, priority or extent of
Agent’s security interests in and Liens on the Collateral.

4.Conditions to Effectiveness; Post Closing Conditions and Covenants.  This
Agreement shall become effective as of the date on which each of the items below
have been delivered to Agent or the conditions have otherwise been satisfied,
each in form and substance satisfactory to Agent and each Lender:  

 

(a)

executed counterparts to this Agreement, duly executed by an authorized officer
of each Credit Party;

 

(b)

Secured Promissory Notes, as requested by Agent or Lenders, dated the Effective
Date, duly executed by an authorized officer of Borrower;

 

(c)

that certain fee letter, dated as of the date hereof (the “Third Amendment Fee
Letter”), duly executed by an authorized officer of Borrower;

 

(d)

Second Tranche Warrants in favor of Lenders (or their Affiliates), as requested
by Agent or Lenders, duly executed by an authorized officer of Quotient Limited;

 

(e)

all representations and warranties of the Credit Parties contained herein shall
be true and correct in all respects as of the Effective Date (and such parties’
delivery of their respective signatures hereto shall be deemed to be their
certification thereof);

 

(f)

there are no Defaults or Events of Default that have not been waived or cured
(and the Credit Parties’ delivery of their respective signatures hereto shall be
deemed to be its certification that no Defaults or Events of Default currently
exist);

 

(g)

payment of all fees, costs and expenses (including, without limitation, costs
and fees payable pursuant to Section 7 hereof and fees payable pursuant to the
Third Amendment Fee Letter) due and payable as of the date hereof under the
Credit Agreement and the other Loan Documents; and

 

(h)

the Credit Parties shall have delivered such further documents, information,
certificates, records and filings, as Agent may reasonably request.

5.No Waiver or Novation.  The execution, delivery and effectiveness of this
Agreement shall not, except as expressly provided in this Agreement, operate as
a waiver of any right, power or remedy of Agent or any Lender, nor constitute a
waiver of any provision of the Credit Agreement, the Financing Documents or any
other documents, instruments and agreements executed or delivered in connection
with any of the foregoing.  Nothing herein is intended or shall be construed as
a waiver of any existing Defaults or Events of Default under the Credit
Agreement or other Financing Documents or any of Agent’s or any Lender’s  rights
and remedies in respect of such Defaults or Events of Default. Without limiting
the foregoing, Agent and Required Lenders acknowledge that they have not, prior
to the date hereof, delivered to Borrower any notice of Default pursuant to
Article 10 of the Credit Agreement. This Agreement

 

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(together with any other document executed in connection herewith) is not
intended to be, nor shall it be construed as, a novation of the Credit
Agreement.

 

6.Affirmation.  Except as specifically amended pursuant to the terms hereof, the
Credit Agreement and all other Financing Documents (and all covenants, terms,
conditions and agreements therein) shall remain in full force and effect, and
are hereby ratified and confirmed in all respects by the Credit Parties.  Each
Credit Party covenants and agrees to comply with all of the terms, covenants and
conditions of the Credit Agreement (as amended hereby) and the Financing
Documents, notwithstanding any prior course of conduct, waivers, releases or
other actions or inactions on Agent’s or any Lender’s part which might otherwise
constitute or be construed as a waiver of or amendment to such terms, covenants
and conditions.

 

7.Costs and Fees.   Upon the request of Agent, the Credit Parties shall be
responsible for the payment of all reasonable and documented out-of-pocket costs
and fees of Agent’s counsel incurred in connection with the preparation of this
Agreement and any related documents.  If Agent uses in-house counsel for any of
these purposes, the Credit Parties further agree that the Obligations include
reasonable charges for such work commensurate with the fees that would otherwise
be charged by outside legal counsel selected by Agent for the work performed.

 

8.Further Assurances.  Borrower and the other Credit Parties hereby agree that
at any time and from time to time, at the expense of the Credit Parties, they
will promptly execute and deliver all further instruments and documents, and
take all further action, that may be necessary or that Agent or Lenders may
reasonably request, in connection with this Amendment, or to enable them to
exercise and enforce their rights and remedies under this Amendment, the Credit
Agreement and the other Financing Documents.

 

9.Miscellaneous.

 

(a)Reference to and Effect on the Credit Agreement. Upon the effectiveness of
this Agreement, each reference in the Credit Agreement to “this Agreement,”
“hereunder,” “hereof,” “herein,” or words of similar import shall mean and be a
reference to the Credit Agreement, as amended by this Agreement.  Except as
specifically amended pursuant hereto, the Credit Agreement, and all other
Financing Documents (and all covenants, terms, conditions and agreements
therein), shall remain in full force and effect, and are hereby ratified and
confirmed in all respects by Borrower.  

 

(b)Incorporation of Credit Agreement Provisions.  The provisions contained in
Section 12 (Choice of Law, Venue and Jury Trial Waiver), Section 13.2
(Indemnification) and Section 13.9 (Confidentiality) of the Credit Agreement are
incorporated herein by reference to the same extent as if reproduced herein in
their entirety.

 

(c)Headings.  Section headings in this Agreement are included for convenience of
reference only and shall not constitute a part of this Agreement for any other
purpose.

 

 

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(d)Counterparts.  This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.  Signatures by facsimile or by
electronic mail delivery of an electronic version (e.g., .pdf or .tif file) of
an executed signature page shall be treated as delivery of an original and shall
bind the parties hereto. This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersede any and all prior
agreements and understandings, oral or written, relating to the subject matter
hereof.

 

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[SIGNATURES APPEAR ON FOLLOWING PAGES]

 

 

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IN WITNESS WHEREOF, intending to be legally bound, and intending that this
Agreement constitute an agreement executed under seal, the undersigned have
executed this Agreement as of the day and year first hereinabove set forth.

 

 

BORROWER:

 

Quotient Biodiagnostics, Inc.

 

 

By:

 

/s/ Paul Cowan

(SEAL)

Name:

 

Paul Cowan

 

Title:

 

Chairman and Chief Executive Officer

 

 

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GUARANTORS:

 

 

Quotient Limited

 

By:

 

/s/ Paul Cowan

(SEAL)

Name:

 

Paul Cowan

 

Title:

 

Chairman and Chief Executive Officer

 

 

 

Alba Bioscience Limited

 

By:

 

/s/ Paul Cowan

(SEAL)

Name:

 

Paul Cowan

 

Title:

 

Chairman and Chief Executive Officer

 

 

 

QBD (QSIP) Limited

 

By:

 

/s/ Paul Cowan

(SEAL)

Name:

 

Paul Cowan

 

Title:

 

Chairman and Chief Executive Officer

 

 

 

Quotient Suisse SA

 

By:

 

/s/ Paul Cowan

(SEAL)

Name:

 

Paul Cowan

 

Title:

 

Chairman and Chief Executive Officer

 

 

 

Quotient Biocampus limited

 

By:

 

/s/ Paul Cowan

(SEAL)

Name:

 

Paul Cowan

 

Title:

 

Chairman and Chief Executive Officer

 

 

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AGENT:

 

MIDCAP FINANCIAL TRUST

 

 

By:

 

Apollo Capital Management, L.P.,

 

 

its investment manager

 

By:

 

Apollo Capital Management GP, LLC,

 

 

its general partner

 

By:

 

/s/ Maurice Amsellem

(SEAL)

Name:

 

Maurice Amsellem

 

Title:

 

Authorized Signatory

 

 

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Mid-Cap / Quotient – Amendment No. 3 to Credit Agreement

 

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LENDERS:

 

MIDCAP FUNDING V TRUST

 

 

By:

 

Apollo Capital Management, L.P.,

 

 

its investment manager

 

By:

 

Apollo Capital Management GP, LLC,

 

 

its general partner

 

By:

 

/s/ Maurice Amsellem

(SEAL)

Name:

 

Maurice Amsellem

 

Title:

 

Authorized Signatory

 

 

 

MIDCAP FUNDING XIII TRUST

 

 

By:

 

Apollo Capital Management, L.P.,

 

 

its investment manager

 

By:

 

Apollo Capital Management GP, LLC,

 

 

its general partner

 

By:

 

/s/ Maurice Amsellem

(SEAL)

Name:

 

Maurice Amsellem

 

Title:

 

Authorized Signatory

 

 

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FLEXPOINT MCLS SPV LLC

 

 

By:

 

/s/ Daniel Edelman

(SEAL)

Name:

 

Daniel Edelman

 

Title:

 

Vice President

 

 

 

 

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OXFORD FINANCE LLC

 

 

By:

 

/s/ T. A. Lex

(SEAL)

Name:

 

T. A. Lex

 

Title:

 

C O O

 

 

 

 

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Exhibit A

CREDIT FACILITY SCHEDULE

 

The following Credit Facilities are specified on this Credit Facility Schedule:

Credit Facility #1:

 

Credit Facility and Type:Term

 

Lenders for and their respective Applicable Commitments to this Credit Facility:

 

Lender

Applicable Commitment

Midcap Funding V Trust

$3,000,000

MidCap Funding XIII Trust

$15,000,000

Oxford Finance LLC

$10,800,000

FlexPoint MCLS SPV LLC

$1,200,000

Total

$30,000,000

 

The following defined terms apply to this Credit Facility:

 

Applicable Interest Period:  means the one-month period starting on the first
(1st) day of each month and ending on the last day of such month; provided,
however, that the first (1st) Applicable Interest Period for each Credit
Extension under this Credit Facility shall commence on the date that the
applicable Credit Extension is made and end on the last day of such month.  

Applicable Floor:  means two percent (2.0%) per annum for the Applicable Libor
Rate.

 

Applicable Margin:  a rate of interest equal to six and seven one-tenths percent
(6.7%) per annum.

 

Applicable Prepayment Fee:  means the following amount, calculated as of the
date (the “Accrual Date”) that the Applicable Prepayment Fee becomes payable in
the case of prepayments required under the Financing Documents or the date any
voluntary prepayment is made:  (a) for an Accrual Date on or after the Third
Amendment Effective Date through and including the date which is twelve (12)
months after the Third Amendment Effective Date , five percent (5.0%) multiplied
by the aggregate amount of the Credit Extensions made under this Agreement (or,
in the case of a partial prepayment, multiplied by the product of the aggregate
amount of the Credit Extensions made under this Agreement and a fraction equal
to the principal amount of Credit Extensions being prepaid or required to be
prepaid  (whichever is greater) divided by the aggregate amount of the Credit
Extensions made under this Agreement); (b) for an Accrual Date on or after the
date which is twelve (12) months after the Third Amendment Effective Date
through and including the date which is twenty-four (24) months after the Third
Amendment Effective Date , three percent (3.0%) multiplied by the aggregate
amount of the Credit Extensions made under this Agreement (or, in the case of a
partial prepayment, multiplied by the product of the aggregate amount of the
Credit Extensions made under this Agreement and a fraction equal to the
principal amount of Credit Extensions being prepaid or required to be
prepaid  (whichever is greater) divided by the aggregate amount of the Credit
Extensions made under this Agreement); and (c) for an Accrual Date on or after
the date which is twenty-four (24) months after the Third Amendment Effective
Date through and including the date immediately preceding the Maturity Date one
percent (1.0%) multiplied by the aggregate amount of the Credit Extensions made
under this Agreement (or, in the case of a partial prepayment, multiplied by the
product of the aggregate amount of the Credit Extensions made under this
Agreement and a fraction equal to the principal amount of Credit Extensions
being prepaid or required to be prepaid  

 

Ex A - 1

Mid-Cap / Quotient – Amendment No. 3 to Credit Agreement

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(whichever is greater) divided by the aggregate amount of the Credit Extensions
made under this Agreement).

 

Commitment Commencement Date:  Closing Date.

 

Commitment Termination Date:  the close of the Business Day following the
Closing Date.

 

Minimum Credit Extension Amount: $30,000,000

 

Permitted Purpose: means general working capital needs of the Borrower and to
finance the repayment of existing inter-company loans made by the other Credit
Parties to the Borrower and the making of inter-company loans by Borrower to the
other Credit Parties to fund the general working capital needs of the other
Credit Parties.

 

 

 

 

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Credit Facility #2:

 

Credit Facility and Type:Term

 

Lenders for and their respective Applicable Commitments to this Credit Facility:

 

Lender

Applicable Commitment

MidCap Funding XIII Trust

$3,000,000

Oxford Finance LLC

$1,800,000

FlexPoint MCLS SPV LLC

$200,000

Total

$5,000,000

 

The following defined terms apply to this Credit Facility:

 

Applicable Interest Period:  means the one-month period starting on the first
(1st) day of each month and ending on the last day of such month; provided,
however, that the first (1st) Applicable Interest Period for each Credit
Extension under this Credit Facility shall commence on the date that the
applicable Credit Extension is made and end on the last day of such month.  

 

Applicable Floor:  means two percent (2.0%) per annum for the Applicable Libor
Rate.

 

Applicable Margin:  a rate of interest equal to six and seven one-tenths percent
(6.7%) per annum.

 

Applicable Prepayment Fee:  means the following amount, calculated as of the
date (the “Accrual Date”) that the Applicable Prepayment Fee becomes payable in
the case of prepayments required under the Financing Documents or the date any
voluntary prepayment is made:  (a) for an Accrual Date on or after the Third
Amendment Effective Date through and including the date which is twelve (12)
months after the Third Amendment Effective Date, five percent (5.0%) multiplied
by the aggregate amount of the Credit Extensions made under this Agreement (or,
in the case of a partial prepayment, multiplied by the product of the aggregate
amount of the Credit Extensions made under this Agreement and a fraction equal
to the principal amount of Credit Extensions being prepaid or required to be
prepaid  (whichever is greater) divided by the aggregate amount of the Credit
Extensions made under this Agreement) ; (b) for an Accrual Date on or after the
date which is twelve (12) months after the Third Amendment Effective Date
through and including the date which is twenty-four (24) months after the Third
Amendment Effective Date, three percent (3.0%) multiplied by the aggregate
amount of the Credit Extensions made under this Agreement (or, in the case of a
partial prepayment, multiplied by the product of the aggregate amount of the
Credit Extensions made under this Agreement and a fraction equal to the
principal amount of Credit Extensions being prepaid or required to be
prepaid  (whichever is greater) divided by the aggregate amount of the Credit
Extensions made under this Agreement); and (c) for an Accrual Date on or after
the date which is twenty-four (24) months after the Third Amendment Effective
Date through and including the date immediately preceding the Maturity Date one
percent (1.0%) multiplied by the aggregate amount of the Credit Extensions made
under this Agreement (or, in the case of a partial prepayment, multiplied by the
product of the aggregate amount of the Credit Extensions made under this
Agreement and a fraction equal to the principal amount of Credit Extensions
being prepaid or required to be

 

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prepaid  (whichever is greater) divided by the aggregate amount of the Credit
Extensions made under this Agreement).

 

Commitment Commencement Date:  August 1, 2016.

 

Commitment Termination Date:  January 31, 2017.

 

Minimum Credit Extension Amount: $5,000,000

 

Permitted Purpose: means general working capital needs of the Borrower and to
finance the repayment of existing inter-company loans made by the other credit
parties to the Borrower and the making of inter-company loans by Borrower to the
other Credit Parties to fund the general working capital needs of the other
Credit Parties

 

Applicable Funding Conditions:  Lenders shall have received warrants to purchase
shares of Quotient Limited’s fully registered common stock equal to $300,000
divided by the “exercise price”, each in form and substance substantially
similar to the First Tranche Warrants, or otherwise reasonably satisfactory to
Agent and Lenders (the “Second Tranche Warrants”), with the “exercise price” set
at the Fair Market Value (as defined in the First Tranche Warrant) as of the
issue date based on a valuation period of the ten Trading Days (as defined in
the First Tranche Warrant) immediately prior to such issue date.

 

 

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Credit Facility #3:

 

Credit Facility and Type: Term

 

Lenders for and their respective Applicable Commitments to this Credit Facility:

 

Lender

Applicable Commitment

Midcap Funding V Trust

$1,500,000

MidCap Funding XIII Trust

$7,500,000

Oxford Finance LLC

$5,400,000

FlexPoint MCLS SPV LLC

$600,000

Total

$15,000,000

 

The following defined terms apply to this Credit Facility:

 

Applicable Interest Period:  means the one-month period starting on the first
(1st) day of each month and ending on the last day of such month; provided,
however, that the first (1st) Applicable Interest Period for each Credit
Extension under this Credit Facility shall commence on the date that the
applicable Credit Extension is made and end on the last day of such month.  

Applicable Floor:  means two percent (2.00%) per annum for the Applicable Libor
Rate.

 

Applicable Margin:  a rate of interest equal to six and seven one-tenths percent
(6.70%) per annum.

 

Applicable Prepayment Fee:  means the following amount, calculated as of the
date (the “Accrual Date”) that the Applicable Prepayment Fee becomes payable in
the case of prepayments required under the Financing Documents or the date any
voluntary prepayment is made:  (a) for an Accrual Date on or after the Third
Amendment Effective Date through and including the date which is twelve (12)
months after the Third Amendment Effective Date , five percent (5.0%) multiplied
by the aggregate amount of the Credit Extensions made under this Agreement (or,
in the case of a partial prepayment, multiplied by the product of the aggregate
amount of the Credit Extensions made under this Agreement and a fraction equal
to the principal amount of Credit Extensions being prepaid or required to be
prepaid  (whichever is greater) divided by the aggregate amount of the Credit
Extensions made under this Agreement); (b) for an Accrual Date on or after the
date which is twelve (12) months after the Third Amendment Effective Date
through and including the date which is twenty-four (24) months after the Third
Amendment Effective Date , three percent (3.0%) multiplied by the aggregate
amount of the Credit Extensions made under this Agreement (or, in the case of a
partial prepayment, multiplied by the product of the aggregate amount of the
Credit Extensions made under this Agreement and a fraction equal to the
principal amount of Credit Extensions being prepaid or required to be
prepaid  (whichever is greater) divided by the aggregate amount of the Credit
Extensions made under this Agreement); and (c) for an Accrual Date on or after
the date which is twenty-four (24) months after the Third Amendment Effective
Date through and including the date immediately preceding the Maturity Date one
percent (1.0%) multiplied by the aggregate amount of the Credit Extensions made
under this Agreement (or, in the case of a partial prepayment, multiplied by the
product of the aggregate amount of the Credit Extensions made under this
Agreement and a fraction equal to the principal amount of Credit Extensions
being prepaid or required to be

 

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prepaid  (whichever is greater) divided by the aggregate amount of the Credit
Extensions made under this Agreement).

 

Commitment Commencement Date:  MosaiQ Consumables Sale Date.

 

Commitment Termination Date:  June 30, 2017.

 

Minimum Credit Extension Amount: $15,000,000.

 

Permitted Purpose: means general working capital needs of the Borrower and to
finance the repayment of existing inter-company loans made by the other credit
parties to the Borrower and the making of inter-company loans by Borrower to the
other Credit Parties to fund the general working capital needs of the other
Credit Parties

 

Applicable Funding Conditions:

 

(a)Lenders shall have received warrants to purchase shares of Quotient Limited’s
fully registered common stock equal to $900,000 divided by the “exercise price”,
each in form and substance substantially similar to the First Tranche Warrants
or otherwise reasonably satisfactory to Agent and Lenders (the “Third Tranche
Warrants”), with the “exercise price” set at the Fair Market Value (as defined
in the First Tranche Warrant) as of the issue date based on a valuation period
of the ten Trading Days (as defined in the First Tranche Warrant) immediately
prior to such issue date;

 

(b)MosaiQ Consumables Sale Date shall have occurred; and

 

(c)Credit Facility #2 shall have been fully funded.

 

 

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