Exhibit 10.1

EVELO BIOSCIENCES, INC.
LOAN AND SECURITY AGREEMENT

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This LOAN AND SECURITY AGREEMENT (the "Agreement") is entered into as of August
15, 2016, by and between PACIFIC WESTERN BANK, a California state chartered bank
("Bank") and EVELO BIOSCIENCES, INC., a Delaware corporation ("Borrower").
RECITALS
Borrower wishes to obtain credit from time to time from Bank, and Bank desires
to extend credit to Borrower. This Agreement sets forth the terms on which Bank
will advance credit to Borrower, and Borrower will repay the amounts owing to
Bank.
AGREEMENT
The parties agree as follows:
1.
DEFINITIONS AND CONSTRUCTION.

1.1Definitions. As used in this Agreement, all capitalized terms shall have the
definitions set forth on Exhibit A. Any term used in the Code and not defined
herein shall have the meaning given to the term in the Code.
1.2Accounting Terms. Any accounting term not specifically defined on Exhibit A
shall be construed in accordance with GAAP and all calculations shall be made in
accordance with GAAP (except for non-compliance with FAS 123R in monthly
reporting). The term "financial statements" shall include the accompanying notes
and schedules.
2.LOAN AND TERMS OF PAYMENT.
2.1.Credit Extensions.
(a)Promise to Pay. Borrower promises to pay to Bank, in lawful money of the
United States of America, the aggregate unpaid principal amount of all Credit
Extensions made by Bank to Borrower, together with interest on the unpaid
principal amount of such Credit Extensions at rates in accordance with the terms
hereof.
(b)Term Loans.
(i)Subject to and upon the terms and conditions of this Agreement Bank shall
make term loans to Borrower in two Tranches, "Tranche A" and "Tranche B". On the
Closing Date, or as soon thereafter as all conditions precedent to the making
thereof have been met, Bank shall make one (1) term loan to Borrower under
Tranche A in an aggregate principal amount equal to $3,000,000 (the "Initial
Term Loan"). Thereafter, on or prior to the Availability End Date, Borrower may
request and Bank agrees to make one (1) or more additional term loans to
Borrower under Tranche A in an aggregate principal amount not to exceed
$7,000,000 (each a "Tranche A Term Loan" and together with the Initial Term
Loan, the "Tranche A Term Loans"). At any time after Borrower’s achievement of
the Equity Milestone through the Availability End Date, Borrower may request and
Bank agrees to make one (1) or more additional term loans to Borrower in an
aggregate principal amount not to exceed $5,000,000 (each a "Tranche B Term
Loan" and collectively, the "Tranche B Term Loans" and together with the Tranche
A Term Loans, each a "Term Loan" and collectively, the "Term Loans"). The
proceeds of the Initial Term Loan shall be used to refinance all obligations
owing from Borrower to Bank as of the Closing Date. The proceeds of any
subsequent Tranche A Term Loans and the Tranche B Term Loans shall be used for
general working capital purposes and for capital expenditures.
(ii)Interest shall accrue from the date of each Term Loan at the rate specified
in Section 2.3(a) and shall be payable monthly in arrears beginning on the __
day of the month next following the date such Term Loan is funded and continuing
on the same day of each month thereafter. Any Term Loans that are outstanding on
the Availability End Date shall be payable in equal monthly installments of
principal, plus all accrued but unpaid interest, beginning on the Amortization
Start Date and continuing on the same day of each month thereafter through the
Term Loan Maturity Date, at which time all outstanding amounts due in connection
with the Term Loans and any other outstanding amounts due under this Agreement
shall be immediately due and payable. Term Loans, once repaid, may not be
reborrowed. Borrower may prepay any Term Loan without penalty or premium.
(iii)When Borrower desires to obtain a Term Loan, Borrower shall notify Bank
(which notice shall be irrevocable) by facsimile transmission to be received no
later than 3:30 p.m. Eastern time on the Business Day prior to the date on which
the Term Loan is to be made. Such notice shall be substantially in the form of
Exhibit C. The notice shall be signed by an Authorized Officer.
(c)Usage of Credit Card Services Under the Credit Card Line.

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(i)Usage Period. Subject to and upon the terms and conditions of this Agreement,
at any time from the Closing Date through the Credit Card Maturity Date,
Borrower may use the Credit Card Services (as defined below) in amounts and upon
terms as provided in Section 2.1(c)(ii) below.
(ii)Credit Card Services. Subject to and upon the terms and conditions of this
Agreement, Borrower may request corporate credit cards and standard e-commerce
merchant account services from Bank (collectively, the "Credit Card Services").
The aggregate limit of the corporate credit cards and merchant credit card
processing reserves shall not exceed the Credit Card Line. The terms and
conditions (including repayment and fees) of such Credit Card Services shall be
subject to the terms and conditions of Bank’s standard forms of application and
agreement for the Credit Card Services, which Borrower hereby agrees to execute.
(iii)Collateralization of Obligations Extending Beyond Maturity. If Borrower has
not cash secured its obligations with respect to any Credit Card Services by the
Credit Card Maturity Date, then, effective as of such date, the balance in any
deposit accounts held by Bank and the certificates of deposit or time deposit
accounts issued by Bank in Borrower’s name (and any interest paid thereon or
proceeds thereof, including any amounts payable upon the maturity or liquidation
of such certificates or accounts), shall automatically secure such obligations
to the extent of the then continuing or outstanding Credit Card Services.
Borrower authorizes Bank to hold such balances in pledge and to decline to honor
any drafts thereon or any requests by Borrower or any other Person to pay or
otherwise transfer any part of such balances for so long as the applicable
Credit Card Services are outstanding or continue.
2.2.Intentionally Omitted.
2.3.Interest Rates, Payments, and Calculations.
(a)Interest Rate. Except as set forth in Section 2.3(b), the Term Loans shall
bear interest, on the outstanding daily balance thereof, at a variable annual
rate equal to the greater of (A) 0.25% above the Prime Rate then in effect, or
(B) 3.75%.
(b)Late Fee; Default Rate. If any payment is not made within 15 days after the
date such payment is due, at Bank’s election, Borrower shall pay Bank a late fee
equal to the lesser of (i) 5% of the amount of such unpaid amount or (ii) the
maximum amount permitted to be charged under applicable law. At Bank’s election,
all Obligations shall bear interest, from and after the occurrence and during
the continuance of an Event of Default, at a rate equal to 5 percentage points
above the interest rate applicable immediately prior to the occurrence of the
Event of Default.
(c)Payments. Interest on the Term Loans shall be due and payable on the ___
calendar day of each month during the term hereof. Bank shall, at its option,
charge such interest, all Bank Expenses, and all Periodic Payments, in each case
if and when due, against, first, a deposit account designated by Borrower in
writing, and second, if insufficient funds remain in such account, any of
Borrower’s other deposit accounts. Any interest not paid when due shall be
compounded by becoming a part of the Obligations, and such interest shall
thereafter accrue interest at the rate then applicable hereunder.
(d)Computation. In the event the Prime Rate is changed from time to time
hereafter, the applicable rate of interest hereunder shall be increased or
decreased, effective as of the day the Prime Rate is changed, by an amount equal
to such change in the Prime Rate. All interest chargeable under the Loan
Documents shall be computed on the basis of a 360 day year for the actual number
of days elapsed.
2.4.Crediting Payments. Prior to the occurrence of an Event of Default that is
continuing, Bank shall credit a wire transfer of funds, check or other item of
payment to such deposit account or Obligation as Borrower specifies. After the
occurrence and during the continuance of an Event of Default, Bank shall have
the right, in its reasonable discretion, to immediately apply any wire transfer
of funds, check, or other item of payment Bank may receive to conditionally
reduce Obligations, but such applications of funds shall not be considered a
payment on account unless such payment is of immediately available federal funds
or unless and until such check or other item of payment is honored when
presented for payment. Notwithstanding anything to the contrary contained
herein, any wire transfer or payment received by Bank after 5:30 p.m. Eastern
time shall be deemed to have been received by Bank as of the opening of business
on the immediately following Business Day. Whenever any payment to Bank under
the Loan Documents would otherwise be due (except by reason of acceleration) on
a date that is not a Business Day, such payment shall instead be due on the next
Business Day, and additional fees or interest, as the case may be, shall accrue
and be payable for the period of such extension.
2.5.Bank Expenses. On the Closing Date, Borrower shall pay to Bank all Bank
Expenses incurred through the Closing Date, and, after the Closing Date, all
Bank Expenses, as and when they become due.

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2.6.Term. This Agreement shall become effective on the Closing Date and, subject
to Section 12.7, shall continue in full force and effect for so long as any
Obligations (other than inchoate indemnity obligations) remain outstanding or
Bank has any obligation to make Credit Extensions under this Agreement.
Notwithstanding the foregoing, Bank shall have the right to terminate its
obligation to make Credit Extensions under this Agreement immediately and
without notice upon the occurrence and during the continuance of an Event of
Default. Upon payment in full in cash of the Obligations (other than inchoate
indemnity obligations) Borrower may simultaneously with such payment terminate
this agreement upon three (3) Business Days written notice to Bank. Following
such payment in full in cash of the Obligations (other than inchoate indemnity
obligations) at such time as Bank’s obligation to make Credit Extensions has
terminated, Bank shall release its Liens in the Collateral and Bank shall
promptly take such action reasonably requested by Borrower, at Borrower’s sole
cost and expense, in order to cause such Liens to be terminated of record
(including by filing UCC-3 or similar termination statements with respect to
such Liens), and all rights therein shall revert to Borrower.
3.CONDITIONS OF LOANS.
3.1Conditions Precedent to Closing. The agreement of Bank to enter into this
Agreement on the Closing Date is subject to the condition precedent that Bank
shall have received, in form and substance satisfactory to Bank, each of the
following items and completed each of the following requirements:
(a)this Agreement;
(b)an officer’s certificate of Borrower with respect to incumbency and
resolutions authorizing the execution and delivery of this Agreement;
(c)a financing statement (Form UCC-1);
(d)payment of the Bank Expenses then due specified in Section 2.5, which may be
debited from any of Borrower’s accounts with Bank;
(e)current SOS Reports indicating that except for Permitted Liens, there are no
other security interests or Liens of record in the Collateral;
(f)current financial statements, including company prepared statements for
Borrower’s most recently ended fiscal year, company prepared consolidated
balance sheets, income statements and statements of cash flows for the most
recently ended month in accordance with Section 6.2, and such other updated
financial information as Bank may reasonably request;
(g)current Compliance Certificate in accordance with Section 6.2;
(h)a warrant to purchase Borrower’s Series A-3 preferred stock issued by
Borrower in favor of Bank;
(i)an amended and restated warrant to purchase Borrower’s Series A-1 preferred
stock issued by Borrower in favor of Bank;
(j)a Borrower Information Certificate;
(k)such other documents or certificates, and completion of such other matters,
as Bank may reasonably request; and
(l)Borrower shall have opened and funded not less than $50,000 in deposit
accounts held with Bank.
3.2Conditions Precedent to all Credit Extensions. The obligation of Bank to make
each Credit Extension, including the initial Credit Extension, is contingent
upon the Borrower’s compliance with Section 3.1 above, and is further subject to
the following conditions:
(a)timely receipt by Bank of the Loan Advance/Paydown Request Form as provided
in Section 2.1;
(b)Borrower shall be in compliance with Section 6.6 hereof;
(c)in Bank’s sole, but reasonable, discretion, there has not been a Material
Adverse Effect; and
(d)the representations and warranties contained in Section 5 shall be true and
correct in all material respects on and as of the date of such Loan
Advance/Paydown Request Form and on the effective date of each Credit Extension
as though made at and as of each such date, and no Event of Default shall have
occurred and be continuing, or would exist after giving effect to such Credit
Extension (provided, however, that those representations

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and warranties expressly referring to another date shall be true, correct and
complete in all material respects as of such date). The making of each Credit
Extension shall be deemed to be a representation and warranty by Borrower on the
date of such Credit Extension as to the accuracy of the facts referred to in
this Section 3.2.
3.3Post-Closing Conditions.
(a)On the date that Bank makes a Tranche B Term Loan to Borrower, Borrower shall
deliver to Bank a warrant to purchase stock in the form attached hereto as
Exhibit E.
(b)As soon as possible, but no later than thirty (30) days after the Closing
Date, Borrower shall deliver to Bank evidence satisfactory to Bank that the
insurance policies required by Section 6.5 hereof are in full force and effect
together with evidence showing loss payable and additional insured clauses or
endorsements in favor of Bank.
4.CREATION OF SECURITY INTEREST.
4.1Grant of Security Interest. Borrower grants and pledges to Bank a continuing
security interest in the Collateral to secure prompt repayment of any and all
Obligations and to secure prompt performance by Borrower of each of its
covenants and duties under the Loan Documents. Except for Permitted Liens or as
disclosed in the Schedule, such security interest constitutes a valid, first
priority security interest in the presently existing Collateral, and will
constitute a valid, first priority security interest in later-acquired
Collateral. Borrower also hereby agrees not to sell, transfer, assign, mortgage,
pledge, lease, grant a security interest in, or encumber any of its Intellectual
Property, other than Permitted Liens. Notwithstanding any termination of this
Agreement or of any filings undertaken related to Bank’s rights under the Code,
Bank’s Lien on the Collateral shall remain in effect for so long as any
Obligations (other than inchoate indemnity obligations) are outstanding. Upon
request by Borrower and payment in full in cash of the Obligations (other than
inchoate indemnity obligations) and at such time as Bank’s obligation to make
Credit Extensions has terminated, Bank shall release its liens and interests in
the Collateral and Bank shall take such actions as reasonably requested by
Borrower in order to cause such Liens to be terminated of record (including
filing UCC-3 or similar termination statements with respect to such Liens).
4.2Perfection of Security Interest. Borrower authorizes Bank to file at any time
financing statements, continuation statements, and amendments thereto that (i)
either specifically describe the Collateral or describe the Collateral as all
assets of Borrower of the kind pledged hereunder, and (ii) contain any other
information required by the Code for the sufficiency of filing office acceptance
of any financing statement, continuation statement, or amendment, including
whether Borrower is an organization, the type of organization and any
organizational identification number issued to Borrower, if applicable. Borrower
shall have possession of the Collateral, except goods transferred in the
ordinary course of business where expressly otherwise provided in this Agreement
or where Bank chooses to perfect its security interest by possession in addition
to the filing of a financing statement. Where Collateral is in possession of a
third party bailee, Borrower shall use commercially reasonable efforts as Bank
reasonably requests for Bank to (i) subject to Section 7.11 below, obtain an
acknowledgment, in form and substance reasonably satisfactory to Bank, of the
bailee that the bailee holds such Collateral for the benefit of Bank, and (ii)
subject to Section 6.6, obtain "control" of any Collateral consisting of
investment property, deposit accounts, letter-of-credit rights or electronic
chattel paper (as such items and the term "control" are defined in Revised
Article 9 of the Code) by causing the securities intermediary or depositary
institution or issuing bank to execute a control agreement in form and substance
reasonably satisfactory to Bank. Borrower will not create any chattel paper
without placing a legend on the chattel paper acceptable to Bank indicating that
Bank has a security interest in the chattel paper. Borrower from time to time
may deposit with Bank specific cash collateral to secure specific Obligations;
Borrower authorizes Bank to hold such specific balances in pledge and to decline
to honor any drafts thereon or any request by Borrower or any other Person to
pay or otherwise transfer any part of such balances for so long as such specific
Obligations are outstanding. Borrower shall take such other actions as Bank
reasonably requests to perfect its security interests granted under this
Agreement.
5.REPRESENTATIONS AND WARRANTIES.
Borrower represents and warrants as follows:
5.1.Due Organization and Qualification. Borrower and each Subsidiary is duly
existing under the laws of the state in which it is organized and qualified and
licensed to do business in any state in which the conduct of its business or its
ownership of property requires that it be so qualified, except where the failure
to do so would not reasonably be expected to cause a Material Adverse Effect.
5.2.Due Authorization; No Conflict. The execution, delivery, and performance of
the Loan Documents are within Borrower’s powers, have been duly authorized, and
are not in conflict with nor constitute a breach of any provision contained in
Borrower’s Certificate of Incorporation or Bylaws, nor will they constitute an
event of default

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under any material agreement by which Borrower is bound. Borrower is not in
default under any agreement by which it is bound, except to the extent such
default would not reasonably be expected to cause a Material Adverse Effect.
5.3.Collateral. Borrower has rights in or the power to transfer the Collateral,
and its title to the Collateral is free and clear of Liens, adverse claims, and
restrictions on transfer or pledge except for Permitted Liens. Other than
movable items of personal property such as laptop computers, all Collateral
having an aggregate book value in excess of $250,000 is located solely in the
Collateral States. All Inventory is in all material respects of good and
merchantable quality, free from all material defects, except for Inventory for
which adequate reserves have been made. Except as set forth in the Schedule or
as permitted under Section 6.6, none of the Borrower’s Cash is maintained or
invested with a Person other than Bank or Bank’s affiliates.
5.4.Intellectual Property. Borrower’s Intellectual Property is set forth on
Schedule 5.4 hereto. Borrower is the sole owner of the intellectual property
created or purchased by Borrower, except for (a) licenses permitted hereunder or
granted by Borrower to its customers in the ordinary course of business and (b)
over the counter software that is commercially available to the public. To the
best of Borrower’s knowledge, each of the copyrights, trademarks and patents
created or purchased by Borrower is valid and enforceable, and no part of the
intellectual property created or purchased by Borrower has been judged invalid
or unenforceable, in whole or in part, and no claim has been made to Borrower
that any part of the intellectual property created or purchased by Borrower
violates the rights of any third party except, in each case, to the extent such
claim would not reasonably be expected to cause a Material Adverse Effect.
5.5.Name; Location of Chief Executive Office. Except as disclosed in the
Schedule or for which notice has been provided in accordance with Section 7.2,
Borrower has not done business under any name other than that specified on the
signature page hereof, and its exact legal name is as set forth in the first
paragraph of this Agreement. The chief executive office of Borrower is located
at the address indicated in Section 10 hereof.
5.6.Litigation. Except as set forth in the Schedule, there are no actions or
proceedings pending by or against Borrower or any Subsidiary before any court or
administrative agency in which a likely adverse decision would reasonably be
expected to have a Material Adverse Effect.
5.7.No Material Adverse Change in Financial Statements. All consolidated and
consolidating, if applicable, financial statements related to Borrower and any
Subsidiary that are delivered by Borrower to Bank fairly present in all material
respects Borrower’s consolidated and consolidating, if applicable, financial
condition as of the date thereof and Borrower’s consolidated and consolidating,
if applicable, results of operations for the period then ended. There has not
been a material adverse change in the consolidated or in the consolidating
financial condition of Borrower since the date of the most recent of such
financial statements submitted to Bank.
5.8.Solvency, Payment of Debts. Borrower is able to pay its debts (including
trade debts) as they mature; the fair saleable value of Borrower’s assets
(including goodwill minus disposition costs) exceeds the fair value of its
liabilities; and Borrower is not left with unreasonably small capital after the
transactions contemplated by this Agreement.
5.9.Compliance with Laws and Regulations. Borrower and each Subsidiary have met
the minimum funding requirements of ERISA with respect to any employee benefit
plans subject to ERISA. No event has occurred resulting from Borrower’s failure
to comply with ERISA that is reasonably likely to result in Borrower’s incurring
any liability that could have a Material Adverse Effect. Borrower is not an
"investment company" or a company "controlled" by an "investment company" within
the meaning of the Investment Company Act of 1940. Borrower is not engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying margin stock (within the
meaning of Regulations T and U of the Board of Governors of the Federal Reserve
System). Borrower has not violated any statutes, laws, ordinances or rules
applicable to it, the violation of which would reasonably be expected to have a
Material Adverse Effect. Borrower and each Subsidiary have filed or caused to be
filed all tax returns required to be filed, and have paid, or have made adequate
provision for the payment of, all taxes reflected therein except in each case
those being contested in good faith with adequate reserves under GAAP or where
the failure to file such returns or pay such taxes would not reasonably be
expected to have a Material Adverse Effect.
5.10.Subsidiaries. Borrower does not own any stock, partnership interest or
other equity securities of any Person, except for Permitted Investments.
5.11.Government Consents. Borrower and each Subsidiary 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
for the continued operation of Borrower’s business as currently conducted,
except where the failure to do so would not reasonably be expected to cause a
Material Adverse Effect.
5.12.Inbound Licenses. Except as disclosed on the Schedule or as disclosed
pursuant to Section 6.9, Borrower is not a party to, nor is bound by, any
material license or other material agreement important for the conduct

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of Borrower’s business that prohibits or otherwise restricts Borrower from
granting a security interest in Borrower’s interest in such license or agreement
or any other property important for the conduct of Borrower’s business, other
than this Agreement or the other Loan Documents.
6.AFFIRMATIVE COVENANTS.
Borrower covenants that, until payment in full of all outstanding Obligations
(other than inchoate indemnity obligations), and for so long as Bank may have
any commitment to make a Credit Extension hereunder, Borrower shall do all of
the following:
6.1.Good Standing and Government Compliance. Borrower shall maintain its and
each of its Subsidiaries’ corporate existence and good standing in their
respective states of formation, shall maintain qualification and good standing
in each other jurisdiction in which the failure to so qualify would reasonably
be expected to have a Material Adverse Effect, and shall furnish to Bank the
organizational identification number issued to Borrower by the authorities of
the state in which Borrower is organized, if applicable. Borrower shall meet,
and shall cause each Subsidiary to meet, the minimum funding requirements of
ERISA with respect to any employee benefit plans subject to ERISA. Borrower
shall comply, and shall cause each Subsidiary to comply, with all statutes,
laws, ordinances and government rules and regulations to which it is subject,
and shall maintain, and shall cause each of its Subsidiaries to maintain, in
force all licenses, approvals and agreements, in each case the loss of which or
failure to comply with which would reasonably be expected to have a Material
Adverse Effect.
6.2.Financial Statements, Reports, Certificates. Borrower shall deliver to Bank:
(i) as soon as available, but in any event within 30 days after the end of each
calendar month, a company prepared consolidated and consolidating, as
applicable, balance sheet, income statement, and statement of cash flows
covering Borrower’s operations during such period, in a form reasonably
acceptable to Bank and certified by a Responsible Officer; (ii) starting with
the fiscal year ending December 31, 2016, as soon as available, but in any event
within 180 days after the end of Borrower’s fiscal year, audited (or such other
level as is required by the Investment Agreement) consolidated and
consolidating, as applicable, financial statements of Borrower prepared in
accordance with GAAP, consistently applied, together with an opinion which is
either unqualified, qualified only for going concern related solely to
Borrower’s liquidity position or otherwise consented to in writing by Bank on
such financial statements of an independent certified public accounting firm
reasonably acceptable to Bank; (iii) annual budget approved by Borrower’s Board
of Directors as soon as available but not later than 45 days after the end of
each fiscal year of Borrower during the term of this Agreement; (iv) if
applicable, copies of all statements, reports and notices sent or made available
generally by Borrower to its security holders or to any holders of Subordinated
Debt (excluding any materials provided to such security holders, stockholders,
or holders of Subordinated Debt solely in their capacity as members of
Borrower’s Board of Directors) and all reports on Forms 10-K and 10-Q filed with
the Securities and Exchange Commission; (v) promptly upon receipt of notice
thereof, a report of any legal actions pending or threatened against Borrower or
any Subsidiary that could reasonably be expected to result in damages or costs
to Borrower or any Subsidiary of $250,000 or more; (vi) periodic informal
clinical updates on any material developments as Borrower may determine or upon
request of Bank and (vii) such budgets, sales projections, operating plans or
other information related to Borrower’s business generally prepared by Borrower
in the ordinary course of business as Bank may reasonably request from time to
time.
(a)Within 30 days after the last day of each month, Borrower shall deliver to
Bank with the monthly financial statements a Compliance Certificate certified as
of the last day of the applicable month and signed by a Responsible Officer in
substantially the form of Exhibit D hereto.
(b)As soon as possible and in any event within three (3) Business Days after
becoming aware of the occurrence and existence of an Event of Default hereunder,
Borrower shall deliver to Bank a written statement of a Responsible Officer
setting forth details of the Event of Default, and the action which Borrower has
taken or proposes to take with respect thereto.
(c)Bank (through any of its officers, employees, or agents) shall have the
right, upon reasonable prior notice, from time to time during Borrower’s usual
business hours but no more than once a year (unless an Event of Default has
occurred and is continuing), to inspect Borrower’s Books and to make copies
thereof and to check, test, inspect, audit and appraise the Collateral at
Borrower’s expense in order to verify Borrower’s financial condition or the
amount, condition of, or any other matter relating to, the Collateral.
Borrower may deliver to Bank on an electronic basis any certificates, reports or
information required pursuant to this Section 6.2, and Bank shall be entitled to
rely on the information contained in the electronic files, provided that Bank in
good faith believes that the files were delivered by a Responsible Officer.
Borrower shall include a submission date on any certificates and reports to be
delivered electronically.

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6.3.Inventory and Equipment; Returns. Borrower shall keep all Inventory and
Equipment in good and merchantable condition, free from all material defects
except for Inventory and Equipment (i) sold in the ordinary course of business,
and (ii) for which adequate reserves have been made, in all cases in the United
States and such other locations as to which Borrower gives prior written notice.
Returns and allowances, if any, as between Borrower and its account debtors
shall be on the same basis and in accordance with the usual customary practices
of Borrower, as they exist on the Closing Date, or as is standard in the
industry. Borrower shall promptly notify Bank of all returns and recoveries and
of all disputes and claims involving inventory having a book value of more than
$500,000.
6.4.Taxes. Borrower shall make, and cause each Subsidiary to make, due and
timely payment or deposit of all material federal, state, and local taxes,
assessments, or contributions required of it by law, including, but not limited
to, those laws concerning income taxes, F.I.C.A., F.U.T.A. and state disability,
and will execute and deliver to Bank, on demand, proof reasonably satisfactory
to Bank indicating that Borrower or a Subsidiary has made such payments or
deposits and any appropriate certificates attesting to the payment or deposit
thereof; provided that Borrower or a Subsidiary need not make any payment if the
amount or validity of such payment is contested in good faith by appropriate
proceedings and is reserved against (to the extent required by GAAP) by Borrower
or such Subsidiary.
6.5.Insurance. Borrower, at its expense, shall (i) keep the Collateral insured
against loss or damage, and (ii) maintain liability and other insurance, in each
case as ordinarily insured against by other owners in businesses similar to
Borrower’s. All such policies of insurance shall be in such form, with such
companies, and in such amounts as is customary for businesses similarly situated
to Borrower. All policies of property insurance shall contain a lender’s loss
payable endorsement, in a form reasonably satisfactory to Bank, showing Bank as
lender’s loss payee. All liability insurance policies shall show, or have
endorsements showing, Bank as an additional insured. Any such insurance policies
shall specify that the insurer must give at least 20 days’ notice to Bank before
canceling its policy for any reason (10 days’ notice for cancellation for reason
of non-payment of premium). Within 30 days of the Closing Date, Borrower shall
cause to be furnished to Bank a copy of its policies including any endorsements
covering Bank or showing Bank as an additional insured. Upon Bank’s request,
Borrower shall deliver to Bank certified copies of the policies of insurance and
evidence of all premium payments. Proceeds payable under any casualty policy
will, at Borrower’s option, be payable to Borrower to replace the property
subject to the claim, provided that any such replacement property shall be
deemed Collateral in which Bank has been granted a first priority security
interest, provided that if an Event of Default has occurred and is continuing,
all proceeds payable under any such policy shall, at Bank’s option, be payable
to Bank to be applied on account of the Obligations.
6.6.Primary Depository. Subject to the provisions of Section 3.1(l) and 3.2(b),
Borrower, within thirty (30) days of the Closing Date (the "Transition Period"),
shall maintain all its depository and operating accounts with Bank and its
primary investment accounts with Bank or Bank’s affiliates; provided that prior
to maintaining any investment accounts with Bank’s affiliates, Borrower, Bank,
and any such affiliate shall have entered into a securities account control
agreement with respect to any such investment accounts, in form and substance
satisfactory to Bank. Notwithstanding the above (i) Borrower shall be permitted
to maintain Cash in one or more accounts outside of Bank or Bank’s affiliates,
provided that the total aggregate amount of Cash maintained in such accounts
does not exceed $100,000 at any time and (ii) Borrower may transfer cash to the
MSC Subsidiary so long as the MSC Investment Conditions have been met. Each
Borrower shall use commercially reasonable efforts to open a MSC Subsidiary
deposit account at the Bank.
6.7.Intentionally Omitted.
6.8.Intentionally Omitted.
6.9.Consent of Inbound Licensors. After entering into or becoming bound by any
material inbound license or agreement, Borrower shall: (i) on the next
Compliance Certificate delivered to Bank after entering into such material
license or agreement, provide written notice to Bank of the material terms of
such license or agreement with a description of its likely impact on Borrower’s
business or financial condition; and (ii) at Bank’s request, in good faith use
commercially reasonable efforts to obtain the consent of, or waiver by, any
person whose consent or waiver is necessary for Borrower’s interest in such
licenses or contract rights to be deemed Collateral and for Bank to have a
security interest in it that might otherwise be restricted by the terms of the
applicable license or agreement, whether now existing or entered into in the
future, provided, however, that the failure to obtain any such consent or waiver
shall not constitute a default under this Agreement.
6.10.Creation/Acquisition of Subsidiaries. In the event any Borrower or any
Subsidiary (other than the MSC Subsidiary) of any Borrower creates or acquires
any Subsidiary, Borrower or such Subsidiary shall promptly notify Bank of such
creation or acquisition, and Borrower or such Subsidiary shall take all actions
reasonably requested by Bank to achieve any of the following with respect to
such "New Subsidiary" (defined as a Subsidiary formed after the date hereof
during the term of this Agreement): (i) to cause New Subsidiary to become either
a co-Borrower

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hereunder, if such New Subsidiary (other than an MSC Subsidiary) is organized
under the laws of the United States, or a secured guarantor with respect to the
Obligations; and (ii) to grant and pledge to Bank a perfected security interest
in 100% of the stock, units or other evidence of ownership held by Borrower or
its Subsidiaries of any such New Subsidiary which is organized under the laws of
a jurisdiction in the United States, and 65% of the stock, units or other
evidence of ownership held by Borrower or its Subsidiaries of any such New
Subsidiary which is not organized under the laws of a jurisdiction in the United
States.
6.11.Further Assurances. At any time and from time to time Borrower shall
execute and deliver such further instruments and take such further action as may
reasonably be requested by Bank to effect the purposes of this Agreement.
7.NEGATIVE COVENANTS.
Borrower covenants and agrees that, so long as any credit hereunder shall be
available and until the outstanding Obligations (other than inchoate indemnity
obligations) are paid in full or for so long as Bank may have any commitment to
make any Credit Extensions, Borrower will not do any of the following without
Bank’s prior written consent, which shall not be unreasonably withheld:
7.1.Dispositions. Convey, sell, lease, license, transfer or otherwise dispose of
(collectively, to "Transfer"), or permit any of its Subsidiaries to Transfer,
all or any part of its business or property, or move cash balances on deposit
with Bank to accounts opened at another financial institution not permitted by
Section 6.6, in each case, other than Permitted Transfers.
7.2.Change in Name, Location, Executive Office, or Executive Management; Change
in Business; Change in Fiscal Year; Change in Control. Change its name or the
state of Borrower’s formation or relocate its chief executive office without 30
days prior written notification to Bank; replace or suffer the departure of its
chief executive officer or chief financial officer without delivering written
notification to Bank within 10 days; fail to appoint an interim replacement or
fill a vacancy in the position of chief executive officer or chief financial
officer for more than 90 consecutive days; suffer a change on its board of
directors which results in the failure of at least one partner of Flagship
Ventures Management, Inc. or its Affiliates to serve as a voting member (other
than in connection with an IPO), or suffer the resignation of one or more
directors from its board of directors in anticipation of the Borrower’s
insolvency, in either case without the prior written consent of Bank which may
be withheld in Bank's sole discretion; take action to liquidate, wind up, or
otherwise cease to conduct business in the ordinary course; engage in any
business, or permit any of its Subsidiaries to engage in any business, other
than or reasonably related or incidental to the businesses currently engaged in
by Borrower; change its fiscal year end; have a Change in Control.
7.3.Mergers or Acquisitions. Merge or consolidate, or permit any of its
Subsidiaries to merge or consolidate, with or into any other business
organization (other than mergers or consolidations of a Subsidiary into another
Subsidiary or into Borrower), or acquire, or permit any of its Subsidiaries to
acquire, all or substantially all of the capital stock or property of another
Person except where (a) each of the following conditions is applicable: (i) the
consideration paid in connection with such transactions (including assumption of
liabilities) does not in the aggregate exceed $500,000 during any fiscal year,
(ii) no Event of Default has occurred, is continuing or would exist after giving
effect to such transactions, (iii) such transactions do not result in a Change
in Control, and (iv) Borrower is the surviving entity; or (b) the Obligations
(other than inchoate indemnity obligations) are repaid in full concurrently with
the closing of any merger or consolidation of Borrower in which Borrower is not
the surviving entity; provided, however, that Borrower shall not, without Bank’s
prior written consent, enter into any binding contractual arrangement with any
Person to attempt to facilitate a merger or acquisition of Borrower, unless (i)
no Event of Default exists when such agreement is entered into by Borrower, and
(ii) Borrower notifies Bank in advance of entering into such an agreement
(provided, the failure to give such notification shall not be deemed a material
breach of this Agreement).
7.4.Indebtedness. Create, incur, assume, guarantee or be or remain liable with
respect to any Indebtedness, or permit any Subsidiary so to do, other than
Permitted Indebtedness, or prepay any Indebtedness or take any actions which
impose on Borrower an obligation to prepay any Indebtedness prior to the
scheduled maturity date, except Indebtedness to Bank.
7.5.Encumbrances. Create, incur, assume or allow any Lien with respect to its
property, or assign or otherwise convey any right to receive income, including
the sale of any Accounts, or permit any of its Subsidiaries so to do, except for
Permitted Liens, or covenant to any other Person (other than (i) the licensors
of in-licensed property with respect to such property or (ii) the lessors of
specific equipment or lenders financing specific equipment with respect to such
leased or financed equipment) that Borrower in the future will refrain from
creating, incurring, assuming or allowing any Lien with respect to any of
Borrower’s property.

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7.6.Distributions. Pay any dividends or make any other distribution or payment
on account of or in redemption, retirement or purchase of any capital stock,
except that Borrower may (i) repurchase the stock of former employees,
consultants or directors pursuant to stock repurchase agreements in an aggregate
amount not to exceed $250,000 in any fiscal year, so long as an Event of Default
does not exist prior to such repurchase or would not exist after giving effect
to such repurchase; (ii) repurchase the stock of former employees, consultants
or directors pursuant to stock repurchase agreements in any amount where the
consideration for the repurchase is the cancellation of indebtedness owed by
such former employees, consultants or directors to Borrower regardless of
whether an Event of Default exists; (iii) make dividends or distributions solely
in the common stock of Borrower; (iv) convert any of its equity or Subordinated
Debt securities into other equity or Subordinated Debt securities pursuant to
the terms of such securities or otherwise in exchange therefore; (v) purchase
capital stock in connection with the exercise of stock options or stock
appreciation by way of a cashless exercise, provided that such purchases do not
in the aggregate exceed $250,000 per fiscal year and (vi) purchase fractional
shares of capital stock arising out of stock dividends, splits or combinations
or business combinations in an amount not to exceed $50,000 per fiscal year.
7.7.Investments. Directly or indirectly acquire or own an Investment in, or make
any Investment in or to any Person, or permit any of its Subsidiaries so to do,
other than Permitted Investments, or, subject to the requirements of Section
6.6, maintain or invest any of its investment property with a Person other than
Bank or Bank’s affiliates or permit any Subsidiary to do so unless such Person
has entered into a control agreement with Bank, in form and substance reasonably
satisfactory to Bank, or suffer or permit any Subsidiary to be a party to, or be
bound by, an agreement that restricts such Subsidiary from paying dividends or
otherwise distributing property to Borrower. Notwithstanding the foregoing, if
the MSC Investment Conditions have been met and no Event of Default or an event
that with the passage of time could result in an Event of Default, shall exist,
Borrower may make Investments in a wholly-owned corporation Subsidiary
incorporated in Massachusetts for the purpose of holding Investments as a
Massachusetts security corporation under 830 CMR 63.38B.1 of the Massachusetts
tax code and applicable regulations (as the same may be amended, modified or
replaced from time to time) (the "MSC Subsidiary"). If at any time after the
incorporation of the MSC Subsidiary the MSC Investment Conditions are not met,
then (i) Borrower shall immediately cause the MSC Subsidiary to distribute to
Borrower all assets held by the MSC Subsidiary for deposit into an account at
Bank, and (ii) the Borrower shall not permit the MSC Subsidiary to hold any
assets. Borrower shall not permit the MSC Subsidiary to make any Investments or
hold any assets that would cause the MSC Subsidiary to fail to qualify as a
Massachusetts security corporation under 830 CMR 63.38B.1 of the Massachusetts
tax code and applicable regulations (as the same may be amended, modified or
replaced from time to time).
7.8.Capitalized Expenditures. Make Capitalized Expenditures in excess of 175% of
the amount approved by Borrower’s Board of Directors and set forth in the most
recently approved operating plan delivered to Bank in accordance with Section
6.2(iii) hereof.
7.9.Transactions with Affiliates. Directly or indirectly enter into or permit to
exist any material transaction with any Affiliate of Borrower except for (a)
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, (b) the
sale or issuance of equity securities in a bona fide equity investment round to
investors; provided no Change of Control occurs as a result, (c) Subordinated
Debt, and (d) compensation arrangements approved by Borrower’s Board of
Directors.
7.10.Subordinated Debt. Make any payment in respect of any Subordinated Debt, or
permit any of its Subsidiaries to make any such payment, except in compliance
with the terms of such Subordinated Debt, or amend any provision affecting
Bank’s rights contained in any documentation relating to the Subordinated Debt
without Bank’s prior written consent.
7.11.Inventory and Equipment. Store the Inventory or the Equipment of a book
value in excess of $500,000 with a bailee, warehouseman, collocation facility or
similar third party unless the third party has been notified of Bank’s security
interest and Bank (a) has received an acknowledgment from the third party that
it is holding or will hold the Inventory or Equipment for Bank’s benefit or (b)
is in possession of the warehouse receipt, where negotiable, covering such
Inventory or Equipment. Except for Inventory sold in the ordinary course of
business and for movable items of personal property having an aggregate book
value not in excess of $500,000, and except for such other locations as Bank may
approve in writing, Borrower shall keep the Inventory and Equipment only at the
location set forth in Section 10 and such other locations of which Borrower
gives Bank prior written notice and as to which Borrower has used commercially
reasonable efforts to facilitate Bank in taking such actions as may be necessary
to perfect its security interest or to obtain a bailee’s acknowledgment of
Bank’s rights in the Collateral.
7.12.No Investment Company; Margin Regulation. Become or be controlled by an
"investment company," within the meaning of the Investment Company Act of 1940,
or become principally engaged in, or undertake

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as one of its important activities, the business of extending credit for the
purpose of purchasing or carrying margin stock, or use the proceeds of any
Credit Extension for such purpose.
8.EVENTS OF DEFAULT.
Any one or more of the following events shall constitute an Event of Default by
Borrower under this Agreement:
8.1.Payment Default. If Borrower fails to pay any of the Obligations when due;
8.2.Covenant Default.
(a)If Borrower fails to perform any obligation under Sections 6.2 (financial
reporting), 6.4 (taxes), 6.5 (insurance), 6.6 (primary accounts) or 6.7
(financial covenants, if any), or violates any of the covenants contained in
Article 7 of this Agreement; or
(b)If Borrower fails or neglects to perform or observe any other material term,
provision, condition, covenant contained in this Agreement, in any of the Loan
Documents, or in any other present or future agreement between Borrower and Bank
and as to any default under such other term, provision, condition or covenant
that can be cured, has failed to cure such default within 15 days after Borrower
receives notice thereof or any officer of Borrower becomes aware thereof;
provided, however, that if the default cannot by its nature be cured within the
15 day period or cannot after diligent attempts by Borrower be cured within such
15 day period, and such default is likely to be cured within a reasonable time,
then Borrower shall have an additional reasonable period (which shall not in any
case exceed 30 days) to attempt to cure such default, and within such reasonable
time period the failure to have cured such default shall not be deemed an Event
of Default but no Credit Extensions will be made;
8.3.Material Adverse Change. If there occurs any circumstance or any
circumstances which would reasonably be expected to have a Material Adverse
Effect;
8.4.Attachment. If any material portion of Borrower’s assets is attached,
seized, subjected to a writ or distress warrant, or is levied upon, or comes
into the possession of any trustee, receiver or person acting in a similar
capacity and such attachment, seizure, writ or distress warrant or levy has not
been removed, discharged or rescinded within thirty (30) days, or if Borrower is
enjoined, restrained, or in any way prevented by court order from continuing to
conduct all or any material part of its business affairs, or if a judgment or
other claim becomes a lien or encumbrance upon any material portion of
Borrower’s assets, or if a notice of lien, levy, or assessment is filed of
record with respect to any material portion of Borrower’s assets by the United
States Government, or any department, agency, or instrumentality thereof, or by
any state, county, municipal, or governmental agency, and the same is not paid
within fifteen (15) days after Borrower receives notice thereof, provided that
none of the foregoing shall constitute an Event of Default where such action or
event is stayed or an adequate bond has been posted pending a good faith contest
by Borrower (provided that no Credit Extensions will be made during such cure
period);
8.5.Insolvency. If Borrower becomes insolvent, or if an Insolvency Proceeding is
commenced by Borrower, or if an Insolvency Proceeding is commenced against
Borrower and is not dismissed or stayed within 45 days (provided that no Credit
Extensions will be made prior to the dismissal of such Insolvency Proceeding);
8.6.Other Agreements. If there is an uncured default or other uncured failure to
perform in any agreement to which Borrower is a party with a third party or
parties (a) resulting in a right by such third party or parties, whether or not
exercised, to accelerate the maturity of any Indebtedness in an amount in excess
of $300,000, (b) in connection with any lease of real property material to the
conduct of Borrower’s business, if such default or failure to perform results in
the right of another party to terminate such lease, or (c) that would reasonably
be expected to have a Material Adverse Effect;
8.7.Judgments. If a final, uninsured judgment or judgments for the payment of
money in an amount, individually or in the aggregate, of at least $300,000 shall
be rendered against Borrower and shall remain unsatisfied and unstayed for a
period of 10 days (provided that no Credit Extensions will be made prior to the
satisfaction or stay of the judgment); or
8.8.Misrepresentations. If any material misrepresentation or material
misstatement exists now or hereafter in any warranty or representation set forth
herein or in any certificate delivered to Bank by any Responsible Officer
pursuant to this Agreement or to induce Bank to enter into this Agreement or any
other Loan Document.
8.9.Guaranty. If any guaranty of all or a portion of the Obligations (a
"Guaranty") ceases for any reason to be in full force and effect, or any
guarantor fails to perform any obligation under any Guaranty or a security
agreement securing any Guaranty (collectively, the "Guaranty Documents"), or any
event of default occurs under any Guaranty Document or any guarantor revokes or
purports to revoke a Guaranty, or any material misrepresentation or material

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misstatement exists now or hereafter in any warranty or representation set forth
in any Guaranty Document or in any certificate delivered to Bank in connection
with any Guaranty Document, or if any of the circumstances described in Sections
8.3 through 8.9 occur with respect to any guarantor.
9.BANK’S RIGHTS AND REMEDIES.
9.1.Rights and Remedies. Upon the occurrence and during the continuance of an
Event of Default, Bank may, at its election, without notice of its election and
without demand, do any one or more of the following, all of which are authorized
by Borrower:
(a)Declare all Obligations, whether evidenced by this Agreement, by any of the
other Loan Documents, or otherwise, immediately due and payable (provided that
upon the occurrence of an Event of Default described in Section 8.5
(insolvency), all Obligations shall become immediately due and payable without
any action by Bank);
(b)Demand that Borrower (i) deposit cash with Bank in an amount equal to the
amount of any Letters of Credit remaining undrawn, as collateral security for
the repayment of any future drawings under such Letters of Credit, and (ii) pay
in advance all Letter of Credit fees scheduled to be paid or payable over the
remaining term of the Letters of Credit, and Borrower shall promptly deposit and
pay such amounts;
(c)Cease advancing money or extending credit to or for the benefit of Borrower
under this Agreement or under any other agreement between Borrower and Bank;
(d)Settle or adjust disputes and claims directly with account debtors for
amounts, upon terms and in whatever order that Bank reasonably considers
advisable;
(e)Make such payments and do such acts as Bank considers necessary or reasonable
to protect its security interest in the Collateral. Borrower agrees to assemble
the Collateral if Bank so requires, and to make the Collateral available to Bank
as Bank may designate. Borrower authorizes Bank to enter the premises where the
Collateral is located, to take and maintain possession of the Collateral, or any
part of it, and to pay, purchase, contest, or compromise any encumbrance,
charge, or lien which in Bank’s determination appears to be prior or superior to
its security interest and to pay all expenses incurred in connection therewith.
With respect to any of Borrower’s owned premises, Borrower hereby grants Bank a
license to enter into possession of such premises and to occupy the same,
without charge, in order to exercise any of Bank’s rights or remedies provided
herein, at law, in equity, or otherwise;
(f)place a "hold" on any account maintained with Bank 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;
(g)Set off and apply to the Obligations any and all (i) balances and deposits of
Borrower held by Bank, and (ii) indebtedness at any time owing to or for the
credit or the account of Borrower held by Bank;
(h)Ship, reclaim, recover, store, finish, maintain, repair, prepare for sale,
advertise for sale, and sell (in the manner provided for herein) the Collateral.
Bank is hereby granted a license or other right, solely pursuant to the
provisions of this Section 9.1, to use, without charge, Borrower’s labels,
patents, copyrights, rights of use of any name, trade secrets, trade names,
trademarks, service marks, and advertising matter, or any property of a similar
nature, as it pertains to the Collateral, in completing production of,
advertising for sale, and selling any Collateral and, in connection with Bank’s
exercise of its rights under this Section 9.1, Borrower’s rights under all
licenses and all franchise agreements shall inure to Bank’s benefit;
(i)Sell the Collateral at either a public or private sale, or both, by way of
one or more contracts or transactions, for cash or on terms, in such manner and
at such places (including Borrower’s premises) as Bank determines is
commercially reasonable, and apply any proceeds to the Obligations in whatever
manner or order Bank deems appropriate. Bank may sell the Collateral without
giving any warranties as to the Collateral. Bank may specifically disclaim any
warranties of title or the like. This procedure will not be considered adversely
to affect the commercial reasonableness of any sale of the Collateral. If Bank
sells any of the Collateral upon credit, Borrower will be credited only with
payments actually made by the purchaser, received by Bank, and applied to the
indebtedness of the purchaser. If the purchaser fails to pay for the Collateral,
Bank may resell the Collateral and Borrower shall be credited with the proceeds
of the sale;
(j)Bank may credit bid and purchase at any public sale;
(k)Apply for the appointment of a receiver, trustee, liquidator or conservator
of the Collateral, without notice and without regard to the adequacy of the
security for the Obligations and without regard to the solvency of Borrower, any
guarantor or any other Person liable for any of the Obligations; and

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(l)Any deficiency that exists after disposition of the Collateral as provided
above will be paid immediately by Borrower.
Bank may comply with any applicable state or federal law requirements in
connection with a disposition of the Collateral and compliance will not be
considered adversely to affect the commercial reasonableness of any sale of the
Collateral.
9.2.Power of Attorney. Effective only upon the occurrence and during the
continuance of an Event of Default, Borrower hereby irrevocably appoints Bank
(and any of Bank’s designated officers, or employees) as Borrower’s true and
lawful attorney to: (a) send requests for verification of Accounts or notify
account debtors of Bank’s security interest in the Accounts; (b) endorse
Borrower’s name on any checks or other forms of payment or security that may
come into Bank’s possession; (c) sign Borrower’s name on any invoice or bill of
lading relating to any Account, drafts against account debtors, schedules and
assignments of Accounts, verifications of Accounts, and notices to account
debtors; (d) dispose of any Collateral; (e) make, settle, and adjust all claims
under and decisions with respect to Borrower’s policies of insurance; (f) settle
and adjust disputes and claims respecting the accounts directly with account
debtors, for amounts and upon terms which Bank determines to be reasonable; and
(g) file, in its sole discretion, one or more financing or continuation
statements and amendments thereto, relative to any of the Collateral; provided
Bank may exercise such power of attorney to sign the name of Borrower on any of
the documents described in clause (g) above, regardless of whether an Event of
Default has occurred. The appointment of Bank as Borrower’s attorney in fact,
and each and every one of Bank’s rights and powers, being coupled with an
interest, is irrevocable until all of the Obligations (other than inchoate
indemnity obligations) have been fully repaid and performed and Bank’s
obligation to provide advances hereunder is terminated.
9.3.Accounts Collection. At any time after the occurrence and during the
continuation of an Event of Default, Bank may notify any Person owing funds to
Borrower of Bank’s security interest in such funds and verify the amount of such
Account. Borrower shall collect all amounts owing to Borrower for Bank, receive
in trust all payments as Bank’s trustee, and immediately deliver such payments
to Bank in their original form as received from the account debtor, with proper
endorsements for deposit.
9.4.Bank Expenses. If Borrower fails to pay any amounts or furnish any required
proof of payment due to third persons or entities, as required under the terms
of this Agreement, then Bank may do any or all of the following after reasonable
notice to Borrower: (a) make payment of the same or any part thereof; and/or (b)
obtain and maintain insurance policies of the type discussed in Section 6.5 of
this Agreement, and take any action with respect to such policies as Bank deems
prudent. Any amounts so paid or deposited by Bank shall constitute Bank
Expenses, shall be immediately due and payable, and shall bear interest at the
then applicable rate hereinabove provided, and shall be secured by the
Collateral. Any payments made by Bank shall not constitute an agreement by Bank
to make similar payments in the future or a waiver by Bank of any Event of
Default under this Agreement.
9.5.Bank’s Liability for Collateral. Bank has no obligation to clean up or
otherwise prepare the Collateral for sale. All risk of loss, damage or
destruction of the Collateral shall be borne by Borrower.
9.6.No Obligation to Pursue Others. Bank has no obligation to attempt to satisfy
the Obligations by collecting them from any other person liable for them and
Bank may release, modify or waive any collateral provided by any other Person to
secure any of the Obligations, all without affecting Bank’s rights against
Borrower. Borrower waives any right it may have to require Bank to pursue any
other Person for any of the Obligations.
9.7.Remedies Cumulative. Bank’s rights and remedies under this Agreement, the
Loan Documents, and all other agreements shall be cumulative. Bank shall have
all other rights and remedies not inconsistent herewith as provided under the
Code, by law, or in equity. No exercise by Bank of one right or remedy shall be
deemed an election, and no waiver by Bank of any Event of Default on Borrower’s
part shall be deemed a continuing waiver. No delay by Bank shall constitute a
waiver, election, or acquiescence by it. No waiver by Bank shall be effective
unless made in a written document signed on behalf of Bank and then shall be
effective only in the specific instance and for the specific purpose for which
it was given. Borrower expressly agrees that this Section 9.7 may not be waived
or modified by Bank by course of performance, conduct, estoppel or otherwise.
9.8.Demand; Protest. Except as otherwise provided in this Agreement, Borrower
waives demand, protest, notice of protest, notice of default or dishonor, notice
of payment and nonpayment and any other notices relating to the Obligations.
10.NOTICES.
Unless otherwise provided in this Agreement, all notices or demands by any party
relating to this Agreement or any other agreement entered into in connection
herewith shall be in writing and (except for financial statements and other
informational documents which may be sent by first-class mail, postage prepaid)
shall be personally delivered

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or sent by a recognized overnight delivery service, certified mail, postage
prepaid, return receipt requested, or by telefacsimile to Borrower or to Bank,
as the case may be, at its addresses set forth below:
If to Borrower:
EVELO BIOSCIENCES, INC.

620 Memorial Drive, Suite 200
Cambridge, MA 02139
Attn: Chief Executive Officer
FAX: ___________________

If to Bank:
Pacific Western Bank

406 Blackwell Street, Suite 240
Durham, North Carolina 27701
Attn: Loan Operations Manager
FAX: (919) 314-3080
with a copy to:
Pacific Western Bank

131 Oliver Street, 2nd Floor
Boston, MA 02110
Attn: Scott Hansen
FAX: (781) 547-0848
The parties hereto may change the address at which they are to receive notices
hereunder, by notice in writing in the foregoing manner given to the other.
11.CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.
This Agreement shall be governed by, and construed in accordance with, the
internal laws of the State of North Carolina, without regard to principles of
conflicts of law. Jurisdiction shall lie in the State of North Carolina. All
disputes, controversies, claims, actions and similar proceedings arising with
respect to Borrower’s account or any related agreement or transaction shall be
brought in the General Court of Justice of North Carolina sitting in Durham
County, North Carolina or the United States District Court for the Middle
District of North Carolina, except as provided below with respect to arbitration
of such matters. BANK AND BORROWER EACH ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY
JURY IS A CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED. EACH OF THEM, AFTER
CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT, WITH COUNSEL OF THEIR
CHOICE, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT ANY OF THEM
MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION BASED UPON OR ARISING OUT OF THIS
AGREEMENT OR ANY RELATED INSTRUMENT OR LOAN DOCUMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR ANY COURSE OF CONDUCT, DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN), OR ACTION OF ANY OF THEM. THESE PROVISIONS SHALL NOT
BE DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR RELINQUISHED BY BANK OR
BORROWER, EXCEPT BY A WRITTEN INSTRUMENT EXECUTED BY EACH OF THEM. If the jury
waiver set forth in this Section 11 is not enforceable, then any dispute,
controversy, claim, action or similar proceeding arising out of or relating to
this Agreement, the Loan Documents or any of the transactions contemplated
therein shall be settled by final and binding arbitration held in Durham County,
North Carolina in accordance with the then current Commercial Arbitration Rules
of the American Arbitration Association by one arbitrator appointed in
accordance with those rules. The arbitrator shall apply North Carolina law to
the resolution of any dispute, without reference to rules of conflicts of law or
rules of statutory arbitration. Judgment upon any award resulting from
arbitration may be entered into and enforced by any state or federal court
having jurisdiction thereof. Notwithstanding the foregoing, the parties may
apply to any court of competent jurisdiction for preliminary or interim
equitable relief, or to compel arbitration in accordance with this Section. The
costs and expenses of the arbitration, including without limitation, the
arbitrator’s fees and expert witness fees, and reasonable attorneys’ fees,
incurred by the parties to the arbitration may be awarded to the prevailing
party, in the discretion of the arbitrator, or may be apportioned between the
parties in any manner deemed appropriate by the arbitrator. Unless and until the
arbitrator decides that one party is to pay for all (or a share) of such costs
and expenses, both parties shall share equally in the payment of the
arbitrator’s fees as and when billed by the arbitrator.
12.GENERAL PROVISIONS.
12.1.Successors and Assigns. This Agreement shall bind and inure to the benefit
of the respective successors and permitted assigns of each of the parties and
shall bind all persons who become bound as a debtor to this Agreement; provided,
however, that neither this Agreement nor any rights hereunder may be assigned by
Borrower

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without Bank’s prior written consent, which consent may be granted or withheld
in Bank’s sole, but reasonable, discretion. Bank shall have the right without
the consent of or notice to Borrower to sell, assign, transfer, negotiate, or
grant participation in all or any part of, or any interest in, Bank’s
obligations, rights and benefits hereunder. Notwithstanding the foregoing,
provided that no Event of Default has occurred hereunder, Bank shall not assign
its interest in the Term Loans, the Revolving Line or the Loan Documents to any
Person who in Bank’s reasonable discretion is (i) a direct competitor of
Borrower, or (ii) a vulture or distressed debt fund.
12.2.Indemnification. Borrower shall defend, indemnify and hold harmless Bank
and its officers, employees, and agents (an "Indemnified Person") against: (a)
all obligations, demands, claims, and liabilities claimed or asserted by any
other party in connection with the transactions contemplated by this Agreement;
and (b) all losses or Bank Expenses in any way suffered, incurred, or paid by
Bank, its officers, employees and agents as a result of or in any way arising
out of, following, or consequential to transactions between Bank and Borrower
whether under this Agreement, or otherwise (including without limitation
reasonable attorneys fees and expenses), except for losses caused by an
Indemnified Person’s gross negligence or willful misconduct.
12.3.Time of Essence. Time is of the essence for the performance of all
obligations set forth in this Agreement.
12.4.Severability of Provisions. Each provision of this Agreement shall be
severable from every other provision of this Agreement for the purpose of
determining the legal enforceability of any specific provision.
12.5.Amendments in Writing, Integration. All amendments to or terminations of
this Agreement or the other Loan Documents must be in writing. All prior
agreements, understandings, representations, warranties, and negotiations
between the parties hereto with respect to the subject matter of this Agreement
and the other Loan Documents, if any, are merged into this Agreement and the
Loan Documents.
12.6.Counterparts. This Agreement may be executed in any number of counterparts
and by different parties on separate counterparts, each of which, when executed
and delivered, shall be deemed to be an original, and all of which, when taken
together, shall constitute but one and the same Agreement. Executed copies of
the signature pages of this Agreement sent by facsimile or transmitted
electronically in Portable Document Format ("PDF"), or any similar format, shall
be treated as originals, fully binding and with full legal force and effect, and
the parties waive any rights they may have to object to such treatment.
12.7.Survival. All covenants, representations and warranties made in this
Agreement shall continue in full force and effect so long as any Obligations
remain outstanding or Bank has any obligation to make any Credit Extension to
Borrower. The obligations of Borrower to indemnify Bank with respect to the
expenses, damages, losses, costs and liabilities described in Section 12.2 shall
survive until all applicable statute of limitations periods with respect to
actions that may be brought against Bank have run.
12.8.Confidentiality. In handling any confidential information, Bank and
Borrower and all employees and agents of each such party shall exercise the same
degree of care that such party exercises with respect to its own proprietary
information of the same types to maintain the confidentiality of any non-public
information thereby received or received pursuant to this Agreement except that
disclosure of such information may be made (i) in the case of Bank, to the
subsidiaries or Affiliates of Bank or Borrower in connection with their present
or prospective business relations with Borrower as long as such entities are
subject to similar confidentiality provisions, (ii) in the case of Bank, to
prospective transferees or purchasers of any interest in the Credit Extensions,
provided that they have entered into a comparable confidentiality agreement in
favor of Borrower and have delivered a copy to Borrower, (iii) as required by
law, regulations, rule or order, subpoena, judicial order or similar order, (iv)
in the case of Bank, as may be required in connection with the examination,
audit or similar investigation of Bank by appropriate authorities and (v) as
Bank may reasonably determine in connection with the enforcement of any remedies
hereunder. Confidential information hereunder shall not include information that
either: (a) is in the public domain or in the knowledge or possession of the
receiving party when disclosed to such party, or becomes part of the public
domain after disclosure to such receiving party through no fault of such
receiving party; or (b) is disclosed to such receiving party by a third party,
provided the receiving party does not have actual knowledge that such third
party is prohibited from disclosing such information.

[Balance of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date first above written.
EVELO BIOSCIENCES, INC.

By:__/s/ Jennifer Glennon    

Name: Jennifer Glennon    

Title: Assistant Secretary    

PACIFIC WESTERN BANK

By: /s/ John Orlando    

Name: John Orlando    

Title: Vice President    

[Signature Page to Loan and Security Agreement]

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EXHIBIT A
DEFINITIONS
"Accounts" means all presently existing and hereafter arising accounts, contract
rights, payment intangibles and all other forms of obligations owing to Borrower
arising out of the sale or lease of goods (including, without limitation, the
licensing of software and other technology) or the rendering of services by
Borrower and any and all credit insurance, guaranties, and other security
therefor, as well as all merchandise returned to or reclaimed by Borrower and
Borrower’s Books relating to any of the foregoing.
"Affiliate" means, with respect to any Person, any Person that owns or controls
directly or indirectly such Person, any Person that controls or is controlled by
or is under common control with such Person, and each of such Person’s senior
executive officers, directors, and general partners.
"Amortization Start Date" means the first business day of the month immediately
following the Availability End Date.
"Authorized Officer" means someone designated as such in the corporate
resolution provided by Borrower to Bank in which this Agreement and the
transactions contemplated hereunder are authorized by Borrower’s board of
directors. If Borrower provides subsequent corporate resolutions to Bank after
the Closing Date, the individual(s) designated as "Authorized Officer(s)" in the
most recently provided resolution shall be the only "Authorized Officers" for
purposes of this Agreement.
"Availability End Date" means February 15, 2018; provided that if Borrower
achieves the Equity Milestone, the Availability End Date shall be automatically
extended to August 15, 2018 with no further action required by any of the
parties hereto.
"Bank Expenses" means all reasonable and documented costs or expenses (including
reasonable attorneys’ fees and expenses, whether generated in-house or by
outside counsel) incurred in connection with the preparation, negotiation,
administration, and enforcement of the Loan Documents; reasonable Collateral
audit fees; and Bank’s reasonable and documented attorneys’ fees and expenses
(whether generated in-house or by outside counsel) incurred in amending,
enforcing or defending the Loan Documents (including fees and expenses of
appeal), incurred before, during and after an Insolvency Proceeding, whether or
not suit is brought.
"Borrower’s Books" means all of Borrower’s books and records including: ledgers;
records concerning Borrower’s assets or liabilities, the Collateral, business
operations or financial condition; and all computer programs, or tape files, and
the equipment, containing such information.
"Business Day" means any day that is not a Saturday, Sunday, or other day on
which banks in the State of North Carolina are authorized or required to close.
"Capitalized Expenditures" means current period unfinanced cash expenditures
that are capitalized and amortized over a period of time in accordance with
GAAP, including but not limited to capitalized cash expenditures for capital
equipment, capitalized manufacturing and labor costs as they relate to
inventory, and software development.
"Cash" means cash and cash equivalents at Bank or Bank Affiliates subject to an
account control agreement acceptable to Bank.
"Change in Control" shall mean a transaction other than (i) an IPO or (ii) a
bona fide equity financing or series of financings on terms reasonably
acceptable to Flagship Ventures Management, Inc. so long as at least one
representative of Flagship Ventures Management, Inc. serves as a voting member
of the board of directors, or otherwise reasonably acceptable to Bank, in which
any "person" or "group" (within the meaning of Section 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934) becomes the "beneficial owner" (as defined in
Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly,
of a sufficient number of shares of all classes of stock then outstanding of a
Borrower ordinarily entitled to vote in the election of directors, empowering
such "person" or "group" to elect a majority of the Board of Directors of a
Borrower, who did not have such power before such transaction.
"Closing Date" means the date of this Agreement.
"Code" means the North Carolina Uniform Commercial Code as amended or
supplemented from time to time.

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"Collateral" means the property described on Exhibit B attached hereto and all
Negotiable Collateral to the extent not described on Exhibit B, except to the
extent any such property (i) is non-assignable by its terms without the consent
of the licensor thereof or another party (but only to the extent such
prohibition on transfer is enforceable under applicable law, including, without
limitation, ß25-9-406 and ß25-9-408 of the Code), (ii) is property for which the
granting of a security interest therein is contrary to applicable law, provided
that upon the cessation of any such restriction or prohibition, such property
shall automatically become part of the Collateral, (iii) constitutes the capital
stock of a controlled foreign corporation (as defined in the IRC), in excess of
65% of the voting power of all classes of capital stock of such controlled
foreign corporations entitled to vote or any Subsidiary which sole purpose is to
hold the stock of such controlled foreign corporation, or (iv) is property
(including any attachments, accessions or replacements) that is subject to a
Lien that is permitted pursuant to clause (c) of the definition of Permitted
Liens, if the grant of a security interest with respect to such property
pursuant to this Agreement would be prohibited by the agreement creating such
Permitted Lien or would otherwise constitute a default thereunder, provided,
that such property will be deemed "Collateral" hereunder upon the termination
and release of such Permitted Lien.
"Collateral State" means the state or states where the Collateral is located,
which is Massachusetts.
"Compliance Certificate" means a compliance certificate, in substantially the
form of Exhibit D attached hereto, executed by a Responsible Officer of the
Borrower.
"Contingent Obligation" means, as applied to any Person, any direct or indirect
liability, contingent or otherwise, of that Person with respect to (i) any
indebtedness, lease, dividend, letter of credit or other obligation of another,
including, without limitation, any such obligation directly or indirectly
guaranteed, endorsed, co-made or discounted or sold with recourse by that
Person, or in respect of which that Person is otherwise directly or indirectly
liable; (ii) any obligations with respect to undrawn letters of credit,
corporate credit cards or merchant services issued for the account of that
Person; and (iii) all obligations arising under any interest rate, currency or
commodity swap agreement, interest rate cap agreement, interest rate collar
agreement, or other agreement or arrangement designated to protect a Person
against fluctuation in interest rates, currency exchange rates or commodity
prices; provided, however, that the term "Contingent Obligation" shall not
include endorsements for collection or deposit in the ordinary course of
business. The amount of any Contingent Obligation shall be deemed to be an
amount equal to the stated or determined amount of the primary obligation in
respect of which such Contingent Obligation is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof as
determined by such Person in good faith; provided, however, that such amount
shall not in any event exceed the maximum amount of the obligations under the
guarantee or other support arrangement.
"Copyrights" means 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, now or hereafter existing, created,
acquired or held.
"Credit Card Line" means a Credit Extension of up to $100,000, to be used
exclusively for the provision of Credit Card Services.
"Credit Card Maturity Date" means August 15, 2017.
"Credit Extension" means each Term Loan, use of Credit Card Services or any
other extension of credit by Bank, to or for the benefit of Borrower hereunder.
"Equipment" means all present and future machinery, equipment, tenant
improvements, furniture, fixtures, vehicles, tools, parts and attachments in
which Borrower has any interest.
"Equity Milestone" means Borrower has delivered on or prior to December 31,
2016, evidence, satisfactory to Bank in its sole, but reasonable, discretion,
that Borrower has (i) received (a) a term sheet(s) from investors satisfactory
to Flagship Ventures Management, Inc., pursuant to which such investors agree to
purchase at least $30,000,000 in Borrower’s Series B equity securities (the
"Series B Term Sheet") and (b) unless the investors party to the Series B Term
Sheet agree to purchase at least $45,000,000 in Borrower’s Series B equity
securities, a term sheet(s) from counterparties to partnership, corporate,
collaboration or licensing arrangements acceptable to Bank in its reasonable
discretion, that have been approved and accepted by Borrower’s Board of
Directors for a transaction which, combined with the Series B Term Sheet, will
yield at least $45,000,000 in the aggregate of committed cash proceeds, and (ii)
received at least $30,000,000 in gross cash proceeds from the sale of Borrower’s
Series B equity securities.

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"ERISA" means the Employee Retirement Income Security Act of 1974, as amended,
and the regulations thereunder.
"Event of Default" has the meaning assigned in Article 8.
"GAAP" means generally accepted accounting principles, consistently applied, as
in effect from time to time in the United States.
"Indebtedness" means (a) all indebtedness for borrowed money or the deferred
purchase price of property or services, including without limitation
reimbursement and other reimbursement obligations with respect to surety bonds
and letters of credit, (b) all obligations evidenced by notes, bonds, debentures
or similar instruments, (c) all capital lease obligations, and (d) all
Contingent Obligations, including but not limited to any sublimit contained
herein.
"Insolvency Proceeding" means any proceeding commenced by or against any Person
or entity under any provision of the United States Bankruptcy Code, as amended,
or under any other bankruptcy or insolvency law, including assignments for the
benefit of creditors, formal or informal moratoria, compositions, extension
generally with its creditors, or proceedings seeking reorganization,
arrangement, or other relief.
"Intellectual Property" means all of Borrower’s right, title, and interest in
and to the following:
(a)Copyrights, Trademarks and Patents;
(b)Any and all trade secrets, and any and all intellectual property rights in
computer software and computer software products now or hereafter existing,
created, acquired or held;
(c)Any and all design rights which may be available to Borrower now or hereafter
existing, created, acquired or held;
(d)Any and all claims for damages by way of past, present and future
infringement of any of the rights included above, 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;
(e)All licenses or other rights to use any of the Copyrights, Patents or
Trademarks, and all license fees and royalties arising from such use to the
extent permitted by such license or rights;
(f)All amendments, renewals and extensions of any of the Copyrights, Trademarks
or Patents; and
(g)All proceeds and products of the foregoing, including without limitation all
payments under insurance or any indemnity or warranty payable in respect of any
of the foregoing.
"Inventory" means all present and future inventory in which Borrower has any
interest.
"Investment" means any beneficial ownership of (including stock, partnership or
limited liability company interest or other securities) any Person, or any loan,
advance or capital contribution to any Person.
"Investment Agreement" means, collectively, Borrower’s stock purchase and other
agreement(s) pursuant to which Borrower most recently issued its preferred
stock.
"IPO" means the initial public offering of a Borrower’s equity securities.
"IRC" means the Internal Revenue Code of 1986, as amended, and the regulations
thereunder.
"Letter of Credit" means a commercial or standby letter of credit or similar
undertaking issued by Bank at Borrower’s request.
"Lien" means any mortgage, lien, deed of trust, charge, pledge, security
interest or other encumbrance.
"Loan Documents" means, collectively, this Agreement, any note or notes executed
by Borrower, and any other document, instrument or agreement entered into in
connection with this Agreement, all as amended or extended from time to time.
"Material Adverse Effect" means a material adverse effect on (i) the operations,
business or financial condition of Borrower and its Subsidiaries taken as a
whole, (ii) the ability of Borrower to repay the Obligations or otherwise
perform its obligations under the Loan Documents, or (iii) Borrower’s interest
in, or the value, perfection or priority of Bank’s security interest in the
Collateral.

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"MSC Investment Conditions" means that Borrower has on deposit with Bank or
Bank’s affiliates Cash in an aggregate amount greater than or equal to 120% of
the then outstanding principal and accrued interest on the Term Loans.
"MSC Subsidiary" has the meaning assigned in Section 7.7.
"Negotiable Collateral" means all of Borrower’s present and future letters of
credit of which it is a beneficiary, drafts, instruments (including promissory
notes), securities, documents of title, and chattel paper, and Borrower’s Books
relating to any of the foregoing.
"Obligations" means all debt, principal, interest, Bank Expenses and other
amounts owed to Bank by Borrower pursuant to this Agreement or any other
agreement, whether absolute or contingent, due or to become due, now existing or
hereafter arising, including any interest that accrues after the commencement of
an Insolvency Proceeding and including any debt, liability, or obligation owing
from Borrower to others that Bank may have obtained by assignment or otherwise.
Notwithstanding the foregoing, "Obligations" shall not include any warrant or
equity related investments.
"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.
"Periodic Payments" means all installments or similar recurring payments that
Borrower may now or hereafter become obligated to pay to Bank pursuant to the
terms and provisions of any instrument, or agreement now or hereafter in
existence between Borrower and Bank.
"Permitted Indebtedness" means:
(a)Indebtedness of Borrower in favor of Bank arising under this Agreement or any
other Loan Document;
(b)Indebtedness existing on the Closing Date and disclosed in the Schedule;
(c)Indebtedness not to exceed $500,000 in the aggregate at any time secured by a
lien described in clause (c) of the defined term "Permitted Liens," provided
such Indebtedness does not exceed at the time it is incurred the lesser of the
cost or fair market value of the property financed with such Indebtedness;
(d)Subordinated Debt;
(e)Indebtedness to trade creditors incurred in the ordinary course of business;
and
(f)Indebtedness incurred as a result of endorsing negotiable instruments
received in the ordinary course of business;
(g)At all times until the SVB Letter of Credit Expiry Date, the SVB Letter of
Credit;
(h)Letters of credit with financial institutions other than Bank incurred in the
ordinary course of business in connection with the leasing of real property in
an aggregate amount not to exceed $150,000;
(i)Interest rate hedging arrangements with financial institutions other than
Bank in an aggregate amount not to exceed $150,000 at any time;
(j)Additional unsecured Indebtedness not to exceed $250,000 in the aggregate at
any time; and
(k)Extensions, refinancings and renewals of any items of Permitted Indebtedness,
provided that the principal amount is not increased or the terms modified to
impose more burdensome terms upon Borrower or its Subsidiary, as the case may
be.

"Permitted Investment" means:
(a)Investments existing on the Closing Date disclosed in the Schedule;
(b)(i) Marketable direct obligations issued or unconditionally guaranteed by the
United States of America or any agency or any State thereof maturing within one
year from the date of acquisition thereof, (ii) commercial paper maturing no
more than one year from the date of creation thereof and currently having rating
of at least A-2 or P-2 from either Standard & Poor’s Corporation or Moody’s
Investors Service, (iii) Bank’s certificates of deposit maturing no more than
one year from the date of investment therein, and (iv) Bank’s money market
accounts; (v) Investments in regular deposit or checking accounts held with Bank
or as otherwise permitted by, and subject to the terms and conditions of,
Section 6.6 of this Agreement; and (vi) Investments consistent with any
investment policy adopted by the Borrower’s board of directors;
(c)Investments accepted in connection with Permitted Transfers;

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(d)Investments (i) of Subsidiaries in or to other Subsidiaries or Borrower and
Investments by Borrower in Subsidiaries not to exceed $300,000 in the aggregate
in any fiscal year and (ii) of Borrower in any MSC Subsidiary otherwise
permitted in accordance with the terms of this Agreement;
(e)Investments not to exceed $300,000 outstanding in the aggregate at any time
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
plan agreements approved by Borrower’s Board of Directors;
(f)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 Borrower’s business;
(g)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 subparagraph (g) shall not apply
to Investments of Borrower in any Subsidiary;
(h)Joint ventures or strategic alliances (i) in the ordinary course of
Borrower’s business consisting of the non-exclusive licensing of technology, the
development of technology or the providing of technical support, provided that
any cash Investments by Borrower do not exceed $300,000 in the aggregate in any
fiscal year; and (ii) by Borrower of property permitted to be transferred under
Section 7.1 in connection with joint ventures or strategic alliances or
collaborations of Borrower or a Subsidiary
(i)Investments permitted under Sections 7.3, 7.6 or 7.7; and
(j)Additional Investments, other than Investments in Subsidiaries, by Borrower
that do not exceed $300,000 in the aggregate during the term of this Agreement.

"Permitted Liens" means the following:
(a)Any Liens existing on the Closing Date and disclosed in the Schedule
(excluding Liens to be satisfied with the proceeds of the Credit Extensions) or
arising under this Agreement, the other Loan Documents, or any other agreement
in favor of Bank;
(b)Liens for taxes, fees, assessments or other governmental charges or levies,
either not delinquent or being contested in good faith by appropriate
proceedings and for which Borrower maintains adequate reserves;
(c)Liens not to exceed $500,000 in the aggregate at any time (i) upon or in any
Equipment (other than Equipment financed by a Credit Extension) acquired or held
by Borrower or any of its Subsidiaries to secure the purchase price of such
Equipment or indebtedness incurred solely for the purpose of financing the
acquisition or lease of such Equipment, or (ii) existing on such Equipment at
the time of its acquisition, in each case provided that the Lien is confined
solely to the property so acquired and improvements thereon, and the proceeds of
such Equipment;
(d)Liens incurred in connection with licenses or sublicenses permitted
hereunder;
(e)Statutory Liens securing claims or demands of materialmen, mechanics,
carriers, repairmen, or other like Liens imposed without the action of such
parties arising in the ordinary course of business;
(f)Liens to secure payment for workers’ compensation, employment insurance, old
age pensions, social security or other like obligations incurred in the ordinary
course of business;
(g)Non-exclusive licenses of Intellectual Property granted to third parties in
the ordinary course of business, and licenses of Intellectual Property that
could not result in a legal transfer of title of the licensed property that may
be exclusive in respects other than territory and that may be exclusive as to
territory only as to discrete geographical areas outside of the United States;
(h)Liens incurred in connection with the extension, renewal or refinancing of
the indebtedness secured by Liens of the type described in clauses (a) through
(c) above, provided that any extension, renewal or replacement Lien shall be
limited to the property encumbered by the existing Lien and the principal amount
of the indebtedness being extended, renewed or refinanced does not increase;
(i)Liens securing Subordinated Debt;
(j)Liens arising from judgments, decrees or attachments in circumstances not
constituting an Event of Default under Sections 8.4 (attachment) or 8.7
(judgments);
(k)Leases or subleases of real property granted in the ordinary course of
Borrower’s business (or, if referring to another Person, in the ordinary course
of such Person’s business);
(l)Liens in favor of other financial institutions arising in connection with
Borrower’s deposit accounts held at such institutions to secure standard fees
for deposit services charged by, but not financing made available by such
institutions, provided that Bank has a perfected security interest in the
amounts held in such deposit accounts to the extent required by Section 6.6; and
(m)Liens securing reimbursement obligations in connection with the SVB Letter of
Credit.

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"Permitted Transfer" means the conveyance, sale, lease, transfer or disposition
by Borrower or any Subsidiary of:
(a)Inventory in the ordinary course of business;
(b)licenses and similar arrangements for the use of the property of Borrower or
its Subsidiaries in the ordinary course of business;
(c)worn-out, surplus or obsolete Equipment not financed with the proceeds of
Credit Extensions;
(d)grants of security interests and other Liens that constitute Permitted Liens;
(e)Transfers that constitute Permitted Investments (including transfers to an
MSC Subsidiary that are otherwise permitted hereunder);
(f)Cash in the ordinary course of business, unless otherwise prohibited by the
terms of this Agreement; and
(g)other assets of Borrower or its Subsidiaries that do not in the aggregate
exceed $250,000 during any fiscal year.

"Person" means any individual, sole proprietorship, partnership, limited
liability company, joint venture, trust, unincorporated organization,
association, corporation, institution, public benefit corporation, firm, joint
stock company, estate, entity or governmental agency.
"Prime Rate" means the variable rate of interest, per annum, most recently
announced by Bank, as its "prime rate," whether or not such announced rate is
the lowest rate available from Bank.
"Responsible Officer" means each of the Chief Executive Officer, the Chief
Operating Officer, the Chief Financial Officer, Vice President of Finance and
the Controller of Borrower, as well as any other officer or employee identified
as an Authorized Officer in the corporate resolution delivered by Borrower to
Bank in connection with this Agreement.
"Schedule" means the schedule of exceptions attached hereto and approved by
Bank, if any.
"SOS Reports" means the official reports from the Secretaries of State of each
Collateral State, the state where Borrower’s chief executive office is located,
the state of Borrower’s formation and other applicable federal, state or local
government offices identifying all current security interests filed in the
Collateral and Liens of record as of the date of such report.
"Subordinated Debt" means any debt incurred by Borrower that is subordinated in
writing to the debt owing by Borrower to Bank on terms reasonably acceptable to
Bank (and identified as being such by Borrower and Bank).
"Subsidiary" means any corporation, partnership or limited liability company or
joint venture in which (i) any general partnership interest or (ii) more than
50% of the stock, limited liability company interest or joint venture of which
by the terms thereof ordinary voting power to elect the Board of Directors,
managers or trustees of the entity, at the time as of which any determination is
being made, is owned by Borrower, either directly or through an Affiliate.
"SVB Letter of Credit" means letter of credit number SVBSF010185 issued by
Silicon Valley Bank at the request of Borrower in the face amount of One Hundred
Seventy-Five Thousand Dollars ($175,000).
"SVB Letter of Credit Expiry Date" is July 15, 2017.
"Term Loan Maturity Date" means August 15, 2020.
"Term Loan or "Term Loans" have the meaning assigned in Section 2.1(b)(i).
"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" means any of Tranche A or Tranche B.
"Tranche A" has the meaning assigned in Section 2.1(b)(i).
"Tranche A Term Loan or Tranche A Term Loans" has the meaning assigned in
Section 2.1(b)(i).

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

"Tranche B" has the meaning assigned in Section 2.1(b)(i).
"Tranche B Term Loan or Tranche B Term Loans" has the meaning assigned in
Section 2.1(b)(i).
[Balance of Page Intentionally Left Blank]

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

DEBTOR            EVELO BIOSCIENCES, INC.
SECURED PARTY:        PACIFIC WESTERN BANK
EXHIBIT B
COLLATERAL DESCRIPTION ATTACHMENT TO LOAN AND SECURITY AGREEMENT
All personal property of Borrower (herein referred to as "Borrower" or "Debtor")
whether presently existing or hereafter created or acquired, and wherever
located, including, but not limited to:
(h)all accounts (including health-care-insurance receivables), chattel paper
(including tangible and electronic chattel paper), deposit accounts, documents
(including negotiable documents), equipment (including all accessions and
additions thereto), financial assets, general intangibles (including patents,
trademarks, copyrights, goodwill, payment intangibles, domain names and
software), goods (including fixtures), instruments (including promissory notes),
inventory (including all goods held for sale or lease or to be furnished under a
contract of service, and including returns and repossessions), investment
property (including securities and securities entitlements), letter of credit
rights, money, and all of Debtor’s books and records with respect to any of the
foregoing, and the computers and equipment containing said books and records;
and
(i)any and all cash proceeds and/or noncash proceeds of any of the foregoing,
including, without limitation, insurance proceeds, and all supporting
obligations and the security therefor or for any right to payment. All terms
above have the meanings given to them in the North Carolina Uniform Commercial
Code, as amended or supplemented from time to time, including revised Article 9
of the Uniform Commercial Code-Secured Transactions.
Notwithstanding the foregoing, the Collateral shall not include property (a)
nonassignable by its terms without the consent of the licensor thereof or
another party (but only to the extent such prohibition on transfer is
enforceable under applicable law, including, without limitation, ß25-9-406 and
ß25-9-408 of the Uniform Commercial Code), (b) constitutes the capital stock of
a controlled foreign corporation (as defined in the IRC), in excess of 65% of
the voting power of all classes of capital stock of such controlled foreign
corporations entitled to vote or any Subsidiary with the sole purpose to hold
the stock of such controlled foreign corporation, (c) property (including any
attachments, accessions or replacements) that is subject to an Equipment lien,
if the grant of a security interest with respect to such property would be
prohibited by the agreement creating such lien or would otherwise constitute a
default thereunder, provided, that such property will be deemed "Collateral"
hereunder upon the termination and release of such lien; or (d) any of the
intellectual property, in any medium, of any kind or nature whatsoever, now or
hereafter owned or acquired or received by Borrower, or in which Borrower now
holds or hereafter acquires or receives any right or interest (collectively, the
"Intellectual Property"); provided, however, that the Collateral shall include
all accounts and general intangibles that consist of rights to payment and
proceeds from the sale, licensing or disposition of all or any part, or rights
in, the foregoing (the "Rights to Payment").
Notwithstanding the foregoing, if a judicial authority (including a U.S.
Bankruptcy Court) holds that a security interest in the underlying Intellectual
Property is necessary to have a security interest in the Rights to Payment, then
the Collateral shall automatically, and effective as of August 15, 2016, include
the Intellectual Property to the extent and only to the extent necessary to
permit perfection of Bank’s security interest in the Rights to Payment, and
further provided, however, that Bank’s enforcement rights with respect to any
security interest in the Intellectual Property shall be absolutely limited to
the Rights to Payment only, and Bank shall have no recourse whatsoever with
respect to the underlying Intellectual Property.

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

EXHIBIT C
LOAN ADVANCE / PAYDOWN REQUEST FORM
[Please refer to New Borrower Kit]

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

EXHIBIT D
COMPLIANCE CERTIFICATE
[Please refer to New Borrower Kit]

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

EXHIBIT E
WARRANT TO PURCHASE STOCK
[See attached]

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

SCHEDULE OF EXCEPTIONS

Permitted Indebtedness (Exhibit A)
None
Permitted Investments (Exhibit A) -
None
Permitted Liens (Exhibit A) -
None
Bank Accounts (Section 5.3) -
Checking Accounts:
SILICON VALLEY BANK
3003 TASMAN DRIVE
2ND FLOOR, MAIL SORT HF210
SANTA CLARA, CALIFORNIA 95054

Account Number: 3301272839-2
Purpose: Old Operating Account

COMERICA BANK
226 AIRPORT PARKWAY
SAN JOSE, CA 95110-4348

Account Number: 1894979291
Purpose: Operating Account

Account Number: 1894979291
Purpose: Money Market Account

Intellectual Property (Section 5.4) -
Patents:

Title
Jurisdiction
Application No.
Filing date
Methods and Compositions
US
62/162562
5/15/15
Modified Clostridium, Listeria, or Salmonella for the Treatment of Cancer
US
62/202,639
8/7/15
Microbiome-Based Cancer Diagnostics
US
62/212,415
8/31/15
Microbial Composition and Their Use In Treatment and Prevention Of Allergies
US
62/214153
9/3/15
Microbiome-Based Cancer Prognostics
US
62/220,124
9/17/15
Microbial Compositions and Uses Thereof
US
62/241,644
10/14/15
Bacterial Delivery of Cancer Therapeutics
US
62/241,645
10/14/15
Methods Of Administering Agents According To Rorc Levels
US
62/243664
10/19/15

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

Use Of Exosomes In The Treatment and Prevention Of Allergies
US
62/248244
10/29/15
Methods Of Administering Agents According To Rorc Levels
US
62/253121
11/9/15
Xylose Compositions and Methods For Use Thereof
US
62/257714
11/19/15
Probiotic and Prebiotic Compositions, and Methods Of Use Thereof For Modulation
Of The Microbiome
US
14/952891
11/25/15
Probiotic and Prebiotic Compositions, and Methods Of Use Thereof For Modulation
Of The Microbiome
WO
PCT/US15/62805
11/25/15
Probiotic and Prebiotic Compositions, and Methods Of Use Thereof For Treatment
and Prevention Of Graft Verses Host Disease
US
14/952887
11/25/15
Probiotic and Prebiotic Compositions, and Methods Of Use Thereof For Treatment
and Prevention Of Graft Versus Host Disease
US
14/952892
11/25/15
Probiotic and Prebiotic Compositions, and Methods Of Use Thereof For Trearment
and Prevention Of Graft Versus Host Disease
WO
PCT/US15/62808
11/25/15
Probiotic and Prebiotic Compositions, and Methods Of Use Thereof For Treatment
and Prevention Of Graft Versus Host Disease
WO
PCT/US15/62810
11/25/15
Probiotic and Prebiotic Compositions, and Methods Of Use Thereof For Treament Of
Gastrointestinal Disorders
US
14/952894
11/25/15
Probiotic and Prebiotic Compositions, and Methods Of Use Thereof For Treament Of
Gastrointestinal Disorders
WO
PCT/US15/62809
11/25/15
Probiotic Compositions Containing Clostridiales For Inhibiting Inflammation
US
14/952895
11/25/15
Probiotic Compositions Containing Clostridiales For Inhibiting Inflammation
WO
PCT/US15/62806
11/25/15
Probiotic and Prebiotic Compositions, and Methods Of Use Thereof For Treatment
and Prevention Of Graft Versus Host Disease
US
14/968086
12/14/15
Enhanced Bifidobacteria Using Genome
US
62/276,150
1/7/16
Immune Assays
US
62/276,151
1/7/16
Immune Checkpoint Inhibitor Efficacy Biomarkers
US
62/276,153
1/7/16
Bone Marrow Transplant Efficacy Biomarkers
US
62/276,155
1/7/16
CAR-T Efficacy Biomarkers
US
62/276,161
1/7/16
Immunotherapy Efficacy Biomarkers
US
62/276,163
1/7/16
Bacterial Outer Membrane Vesicles for Immune and Anti-Cancer Response (Bifido)
US
62/280,656
1/19/16
Bacterial Outer Membrane Vesicles for Immune and Anti-Cancer Response (Strep)
US
62/280,658
1/19/16
Microbial Compositions and Their Use in Treatment and Prevention of Drug
Allergies
US
62/288,384
1/28/16
Bacterial and Prebiotic Compositions and Methods of Production and Use Thereof
WO
PCT/US16/18539
2/18/16
Probiotic and Prebiotic Compositions, Methods of Use Thereof for Treatment of
Disorders
WO
PCT/US16/18551
2/18/16
Prebiotic Compounds, Compositions, and Methods of Use Thereof for Treatment of
Neurological Disorders
US
62/298,556
2/23/16
Use Of Exosomes In The Treatment and Prevention Of Allergies
US
62/324,857
4/19/16
Use Of Exosomes In The Treatment and Prevention Of Allergies
US
62/344,775
6/2/16

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

Trademark applications and registrations:

EVELO; US; Application No. 86/582,465; Classes 9, 32, 42, and 44; Filed March
31, 2015
ONCOBIOME; US; Application No. 86/300,247; Classes 5, 9, 10, 42 and 44; Filed
June 4, 2014
ONCOBIOTIC; US; Application No. 86/808,587; Class 5; Filed November 3, 2015
BIA; US; Application No. 86/808,590; Class 5; Filed November 3, 2015

Copyrights applications and registrations:

None

Prior Names (Section 5.5) -
VL28, Inc.
VL 28, LLC
VL 31, Inc.
Epiva Therapeutics, Inc.
Epiva Biosciences, Inc.
Evelo Therapeutics, Inc.

The principal place of business is 620 Memorial Drive, Suite 200 West,
Cambridge, MA 02139

Litigation (Section 5.6) -
None
Inbound Licenses (Section 5.12) -
Exclusive License Agreement between University of Chicago and Evelo for a
royalty bearing worldwide exclusive license to the Patent Rights within the
Field of Treatment of Cancer by Manipulation of Commensal Microflora. Effective
Date March 10, 2016.
Exclusive Research and License Agreement between Mayo Foundation for Medical
Education and Research and Evelo to advance immune-microbiome-based therapies
for cancer. Effective Date June 10, 2016.

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

CORPORATE RESOLUTION

The undersigned duly elected and qualified Secretary of EVELO BIOSCIENCES, INC.
(the "Company") does hereby certify, solely in his or her capacity as an officer
of the Company and not in any individual capacity, that the following is a true
and correct copy of certain resolutions adopted by the Company’s Board of
Directors in accordance with applicable law and the Company’s bylaws, and that
such resolutions are now unmodified and in full force and effect:

BE IT RESOLVED, that:

1)
Any one (1) of the following, duly elected officers of the Company (each, an
"Authorized Officer") whose genuine original signature appears next to his or
her name is authorized to act for, on behalf of, and in the name of the Company
in connection with the resolutions below:

Title
Name
Authorized Signature
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________
__________________________________

2)
Any Authorized Officer may:

a)
Borrow money from time to time from Pacific Western Bank (the "Bank"), and may
negotiate and procure loans, letters of credit, foreign exchange contracts and
other financial accommodations from Bank, including without limitation, that
certain Loan and Security Agreement dated as of August 15, 2016, and also to
execute and deliver to Bank one or more renewals, extensions, or modifications
thereof;

b)
Give security for any liabilities of the Company to Bank by grant, security
interest, assignment, lien, deed of trust or mortgage upon any real or personal
property, tangible or intangible of the Company;

c)
Purchase, sell, exchange, assign, endorse for transfer and/or deliver
certificates and/or instruments representing stocks, bonds, evidences of
Indebtedness or other securities owned by the Company, whether or not registered
in the name of the Company;

d)
Discount with the Bank, commercial or other business paper belonging to the
Company made or drawn by or upon third parties, without limit as to amount;

e)
Authorize and direct the Bank to pay the proceeds of any such loans or discounts
as directed by the persons so authorized to sign;

f)
Issue a warrant or warrants to purchase the Company’s capital stock;

g)
Execute and deliver in form and content as may be required by the Bank any and
all notes, evidences of indebtedness, applications for letters of credit,
guaranties, subordination agreements, loan and security agreements, financing
statements, assignments, liens, deeds of trust, mortgages, trust receipts and
other agreements, instruments or documents to carry out the purposes of these
Resolutions, any or all of which may relate to all or to substantially all of
the Company’s property and assets.

3)
The Authorized Officers may designate additional or alternate individuals as
being authorized to request loan advances, to do and perform such other acts and
things, to pay any and all fees and costs, and to execute and deliver such other
documents and agreements as he or she may in his or her discretion deem
reasonably necessary or proper in order to carry into effect the provisions of
these Resolutions.

4)
Any and all acts authorized pursuant to these resolutions and performed prior to
the passage of these resolutions are hereby ratified and approved, and the
authority conferred herein may be exercised singly by any such officer, and
these resolutions shall continue in full force and effect until written notice
of modification or revocation is received and accepted by Bank (such notice to
have no effect on any action previously taken by the Bank in reliance on these
Resolutions). Bank may rely upon any form of notice, which it in good faith
believes to be genuine or what it purports to be.

5)
The Resolutions are in full force and effect as of the date of this Certificate
and are intended to replace, as of this date, any Resolutions previously given
by the Company to Bank in connection with the matters described herein; these
Resolutions and any borrowings or financial accommodations under these
Resolutions have been properly noted in the corporate books and records, and
have not been rescinded, revoked or modified; neither the foregoing Resolutions
nor any actions to be taken pursuant to them are or will be in contravention of
any provision of the articles of incorporation or bylaws of the Company or of
any agreement, indenture or other instrument to which the Company is a party or
by which it is bound; and to the extent the articles of incorporation or bylaws
of the Company or any agreement, indenture or other instrument to which the
Company is a party or by which it is bound

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

require the vote or consent of shareholders of the Company to authorize any act,
matter or thing described in the foregoing Resolutions, such vote or consent has
been obtained.

In Witness Whereof, I have affixed my name as Secretary and have caused the
corporate seal (where available) of said Company to be affixed on August 15,
2016.

                    

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

USA PATRIOT ACT
NOTICE
OF
CUSTOMER IDENTIFICATION

IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT
To help the government fight the funding of terrorism and money laundering
activities, Federal law requires all financial institutions to obtain, verify,
and record information that identifies each person who opens an account.
WHAT THIS MEANS FOR YOU: when you open an account, we will ask your name,
address, date of birth, and other information that will allow us to identify
you. We may also ask to see your driver's license or other identifying
documents.

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

PACIFIC WESTERN BANK
 
 
AUTOMATIC DEBIT AUTHORIZATION
Member FDIC
 
 
 
 
 
To: Pacific Western Bank
 
Re: Loan # ___________________________________
 
You are hereby authorized and instructed to charge account No.
_________________________ in the name of
EVELO BIOSCIENCES, INC.
for facility fees, principal, interest and other payments due on above
referenced loan as set forth below and credit the loan referenced above.
 
__X__Debit each interest payment as it becomes due according to the terms of the
Loan and Security Agreement and any renewals or amendments thereof.
 
__X__Debit each principal payment as it becomes due according to the terms of
the Loan and Security Agreement and any renewals or amendments thereof.
 
__X__Debit each payment for Bank Expenses as it becomes due according to the
terms of the Loan and Security Agreement and any renewals or amendments thereof.
 
This Authorization is to remain in full force and effect until revoked in
writing.
 
 
Borrower Signature
Date
 
 
 
 

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

FIRST AMENDMENT
TO
LOAN AND SECURITY AGREEMENT
This First Amendment to Loan and Security Agreement (the "Amendment") is entered
into as of June 14, 2017, by and between PACIFIC WESTERN BANK, a California
state chartered bank ("Bank"), and EVELO BIOSCIENCES, INC. ("Borrower").
RECITALS
Borrower and Bank are parties to that certain Loan and Security Agreement dated
as of August 15, 2016 (as amended from time to time, the "Agreement"). The
parties desire to amend the Agreement in accordance with the terms of this
Amendment.
NOW, THEREFORE, the parties agree as follows:
1)
Pursuant to Section 6.2(ii) of the Agreement, Borrower is required to deliver to
Bank, within 180 days after the end of each of Borrower’s fiscal years, annual
audited consolidated and consolidating financial statements for such fiscal year
(the "Annual Audited Financials"). Bank hereby extends the due date for Borrower
to provide its Annual Audited Financials for the 2016 fiscal year to August 30,
2017.

2)
The following defined term in Exhibit A to the Agreement is hereby amended and
restated, as follows:

"Credit Card Line" means a Credit Extension of up to $150,000, to be used
exclusively for the provision of Credit Card Services.

3)
Unless otherwise defined, all initially capitalized terms in this Amendment
shall be as defined in the Agreement. The Agreement, as amended hereby, shall be
and remain in full force and effect in accordance with its respective terms and
hereby is ratified and confirmed in all respects. Except as expressly set forth
herein, the execution, delivery, and performance of this Amendment shall not
operate as a waiver of, or as an amendment of, any right, power, or remedy of
Bank under the Agreement, as in effect prior to the date hereof. Borrower
ratifies and reaffirms the continuing effectiveness of all agreements entered
into in connection with the Agreement.

4)
Borrower represents and warrants that the representations and warranties
contained in the Agreement are true and correct as of the date of this
Amendment.

5)
This Amendment may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one
instrument.

6)
As a condition to the effectiveness of this Amendment, Bank shall have received,
in form and substance satisfactory to Bank, the following:

a)
this Amendment, duly executed by Borrower;

b)
payment of all Bank Expenses, including Bank’s expenses for the documentation of
this amendment and any related documents, and any UCC, good standing or
intellectual property search or filing fees, which may be debited from any of
Borrower's accounts; and

c)
such other documents and completion of such other matters, as Bank may
reasonably deem necessary or appropriate.

[Signature Page Follows]

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

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first
date above written.

EVELO BIOSCIENCES, INC.
 PACIFIC WESTERN BANK

By: _/s/ Jennifer Glennon______________

By: _/s/ Scott Hansen_________________
Name: _Jennifer Glennon______________
Title: _Head of Finance & Operations____
Name: _Scott Hansen_________________
 Title: __SVP_______________________
 
 

[Signature Page to First Amendment to Loan and Security Agreement]

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

SECOND AMENDMENT
TO
LOAN AND SECURITY AGREEMENT
This Second Amendment to Loan and Security Agreement (this "Amendment") is
entered into as of August 18, 2017, by and between PACIFIC WESTERN BANK, a
California state chartered bank ("Bank"), and EVELO BIOSCIENCES, INC.
("Borrower").
RECITALS
Borrower and Bank are parties to that certain Loan and Security Agreement dated
as of August 15, 2016 (as amended from time to time, the "Agreement"). The
parties desire to amend the Agreement in accordance with the terms of this
Amendment.
NOW, THEREFORE, the parties agree as follows:
1)
The following defined term in Exhibit A to the Agreement is hereby amended and
restated, as follows:

"Credit Card Maturity Date" means August 14, 2018.
2)
Unless otherwise defined, all initially capitalized terms in this Amendment
shall be as defined in the Agreement. The Agreement, as amended hereby, shall be
and remain in full force and effect in accordance with its respective terms and
hereby is ratified and confirmed in all respects. Except as expressly set forth
herein, the execution, delivery, and performance of this Amendment shall not
operate as a waiver of, or as an amendment of, any right, power, or remedy of
Bank under the Agreement, as in effect prior to the date hereof. Borrower
ratifies and reaffirms the continuing effectiveness of all agreements entered
into in connection with the Agreement.

3)
Borrower represents and warrants that the representations and warranties
contained in the Agreement are true and correct as of the date of this
Amendment.

4)
This Amendment may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one
instrument.

5)
As a condition to the effectiveness of this Amendment, Bank shall have received,
in form and substance satisfactory to Bank, the following:

a)
this Amendment, duly executed by Borrower;

b)
payment of all Bank Expenses, including Bank’s expenses for the documentation of
this amendment and any related documents, and any UCC, good standing or
intellectual property search or filing fees, which may be debited from any of
Borrower's accounts; and

c)
such other documents and completion of such other matters, as Bank may
reasonably deem necessary or appropriate.

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first
date above written.

EVELO BIOSCIENCES, INC.
 PACIFIC WESTERN BANK

By: _/s/ Jennifer Glennon______________

By: _/s/ Scott Hansen_________________
Name: _Jennifer Glennon______________
Title: _VP, Finance and Operations______
Name: _Scott Hansen_________________
 Title: _SVP________________________
 
 

[Signature Page to Second Amendment to Loan and Security Agreement]

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

THIRD AMENDMENT TO
LOAN AND SECURITY AGREEMENT
This Third Amendment to Loan and Security Agreement (this "Amendment") is made
and entered into as of February 7, 2018 by and between PACIFIC WESTERN BANK, a
California state chartered bank ("Bank"), EVELO BIOSCIENCES, INC. (individually
or collectively, as the context may require, "Borrower").
RECITALS
Borrower and Bank are parties to that certain Loan and Security Agreement dated
as of August 15, 2016, as amended by that certain First Amendment to Loan and
Security Agreement, dated as of June 14, 2017, and that certain Second Amendment
to Loan and Security Agreement, dated as of August 18, 2017 (as further amended,
restated, supplemented or otherwise modified from time to time, the
"Agreement"). The parties desire to amend the Agreement in accordance with the
terms of this Amendment.
NOW, THEREFORE, the parties agree as follows:
1)
Amendments to Agreement.

a)
Section 2.1(b) of the Agreement is hereby amended and restated, as follows:

(b)Term Loan.
(i)Prior to the Third Amendment Date, Borrower has requested and Bank has made,
term loans in an aggregate principal amount of $10,000,000 (the "Existing Term
Loans"). As of the Third Amendment Date, the aggregate principal amount of
Existing Term Loans is $10,000,000. On the Third Amendment Date, Borrower shall
request and Bank agrees to make a new term loan in original principal amount of
$15,000,000 (the "Term Loan"), which shall be applied first to refinance in full
the Existing Term Loans, and then, for general working capital purposes and for
capital expenditures. As of the Third Amendment Date, Bank’s commitment to make
the Tranche B Term Loans shall be terminated.
(ii)Interest shall accrue from the date of the Term Loan at the rate specified
in Section 2.3(a), and shall be payable monthly in arrears on the 15th day of
the month, beginning on February 15, 2018, and continuing on the same day of
each month each month thereafter. Any Term Loans that are outstanding on August
15, 2019 shall be payable in 24 equal monthly installments of principal, plus
all accrued interest, beginning on September 15, 2019 and continuing on the same
day of each month thereafter through the Term Loan Maturity Date, at which time
all amounts due in connection with the Term Loan and any other amounts due under
this Agreement shall be immediately due and payable. The Term Loan, once repaid,
may not be reborrowed.
(iii)    Borrower may prepay all but not less than all of the Term Loan at any
time, provided that Borrower may not reborrow any amount so prepaid, and
provided further that upon any prepayment, including any prepayment due to the
occurrence of an Event of Default, Borrower shall pay, in addition to all
outstanding principal and accrued interest on the Term Loans, the Prepayment
Fee.
b)
Section 2.3(a) of the Agreement is hereby amended and restated to read as
follows:

(a)Interest Rate. Except as set forth in Section 2.3(b), the Term Loan shall
bear interest, on the outstanding daily balance thereof, at a variable annual
rate equal to the greater of (A) 0.25% above the Prime Rate then in effect, or
(B) 4.50%.
c)
Section 2.3(c) of the Agreement is hereby amended and restated to read as
follows:

(c)     Payments. Interest under the Term Loans shall be due and payable monthly
in arrears on the 15th calendar day of each month during the term hereof. Bank
shall, at its option, charge such interest, fees, all Bank Expenses, and all
Periodic Payments, in each case, if and when due, against first, a deposit
account designated by Borrower in writing, and second, if insufficient funds
remain in such account, any of Borrower’s other deposit accounts. Any interest
not paid when due shall be compounded by becoming a part of the Obligations, and
such interest shall thereafter accrue interest at the rate then applicable
hereunder.
d)
Section 2.5 of the Agreement is hereby amended and restated to read as follows:

2.5    Fees. Borrower shall pay to Bank the following:

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

(a)    Facility Fee. On the Third Amendment Date, a facility fee of $25,000,
which shall be nonrefundable;
(b)    Prepayment Fee. The Prepayment Fee, when due hereunder.
(c)    Success Fee. Upon a Liquidity Event, Borrower shall pay to Bank a fee of
$250,000 (the "Success Fee"). This Section 2.5(c) shall survive any termination
of this Agreement until the earlier of (i) payment of full of the Success Fee
and (ii) February 7, 2028.
(d)    Bank Expenses. On the Closing Date, all Bank Expenses incurred through
the Closing Date (which have been paid as of the Third Amendment Date), and
thereafter, all Bank Expenses as and when they become due.
e)
Subsection (a) of Section 3.3 of the Agreement is hereby amended and restated to
read as follows:

(a)    [Reserved.]
f)
Section 6.6 of the Agreement is hereby amended and restated to read as follows:

6.6    Primary Depository. Borrower shall maintain all its depository and
operating accounts with Bank and its primary investment accounts with Bank or
Bank's affiliates; provided that prior to maintaining any investment accounts
with Bank's affiliates, Borrower, Bank, and any such affiliate shall have
entered into a securities account control agreement with respect to any such
investment accounts, in form and substance satisfactory to Bank. Notwithstanding
the above, (a) Borrower shall be permitted to maintain Cash in one or more
accounts outside of Bank or Bank's affiliates with a control agreement, provided
that the total aggregate amount of Cash maintained in deposit accounts or
investment accounts of Borrower at Bank exceed 200% of the sum of (i) the
aggregate original principal amount of the Term Loan plus (ii) the maximum
amount of the Credit Card Line, and (b) Borrower may transfer cash to the MSC
Subsidiary so long as the MSC Investment Conditions have been met. Borrower
shall use commercially reasonable efforts to open a MSC Subsidiary deposit
account at the Bank.
g)
Section 7.8 of the Agreement is hereby amended to replace the reference to
"175%" with "200%".

h)
Exhibit A of the Agreement is hereby amended to amend or add the definitions set
forth below in appropriate alphabetical order, as applicable:

"Credit Extension" means the Term Loan, the Credit Card Services provided under
the Credit Card Line, or any other extension of credit by Bank to or for the
benefit of Borrower hereunder.
"Liquidity Event" means (a) any sale, license, or other disposition of all or
substantially all of the assets (including intellectual property) of Borrower,
(b) any reorganization, consolidation, merger or sale of the voting securities
of Borrower or any other transaction where the holders of Borrower’s securities
before the transaction beneficially own less than 50% of the outstanding voting
securities of the surviving entity after the transaction, or (c) an initial
public offering of Borrower’s equity securities.
"Obligations" means all debt, principal, interest, Bank Expenses and other
amounts owed to Bank by Borrower pursuant to this Agreement or any other
agreement, whether absolute or contingent, due or to become due, now existing or
hereafter arising, including any interest that accrues after the commencement of
an Insolvency Proceeding and including any debt, liability, or obligation owing
from Borrower to others that Bank may have obtained by assignment or otherwise.
Notwithstanding the foregoing, "Obligations" shall not include the Success Fee,
any warrant or equity related investments.
"Prepayment Fee" means a fee in an amount equal to (i) 2.0% of the principal
amount prepaid, with respect to a prepayment made on or prior to August 15,
2018, and (ii) 0.5% of the principal amount prepaid, with respect to a
prepayment made after August 15, 2018 but on or prior to August 15, 2019. For
the avoidance of doubt, no Prepayment Fee shall be required for any prepayments
made on or after August 15, 2019.
"Term Loan" has the meaning set forth in Section 2.1(b)(i).
"Term Loan Maturity Date" means August 15, 2021.
"Third Amendment Date" means February 7, 2018.
i)
Exhibit A of the Agreement is hereby amended to delete the following defined
terms and related definitions: "Availability End Date", Equity Milestone",
"Tranche A", "Tranche A Term Loan or Tranche A Term Loans", "Tranche B", and
"Tranche B Term Loan or Tranche B Term Loans".

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

j)
The Schedule attached to the Agreement is hereby amended and restated as set
forth in the Schedule attached hereto.

2)
Unless otherwise defined, all initially capitalized terms in this Amendment
shall be as defined in the Agreement. The Agreement, as amended hereby, shall be
and remain in full force and effect in accordance with its respective terms and
hereby is ratified and confirmed in all respects. Except as expressly set forth
herein, the execution, delivery, and performance of this Amendment shall not
operate as a waiver of, or as an amendment of, any right, power, or remedy of
Bank under the Agreement, as in effect prior to the date hereof. Borrower
ratifies and reaffirms the continuing effectiveness of all agreements entered
into in connection with the Agreement.

3)
Borrower represents and warrants that:

a)
No Material Effect has occurred and is continuing;

b)
Borrower is in compliance with Section 6.6 of the Agreement, as amended by this
Amendment;

c)
The execution, delivery and performance of the Agreement and this Amendment are
within Borrower’s powers, have been duly authorized, and are not in conflict
with, nor constitute a breach of any provision contained in Borrower’s
Certificate of Incorporation or Bylaws, nor will they constitute an event of
default under any material agreement by which Borrower is bound. Borrower is not
in default under any agreement by which it is bound, except to the extent such
default would not reasonably be expected to cause a Material Adverse Effect;

d)
the representations and warranties of Borrower contained in the Agreement are
true and correct in all material respects as of the date of this Amendment
(provided, however, that those representations and warranties expressly
referring to another date shall be true, correct and complete in all material
respects as of such date).

4)
This Amendment may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one
instrument.

5)
The provisions of Sections 11 and 12 are hereby incorporated herein, provided
that all references to the "Agreement", shall mean the Agreement, as amended by
this Amendment.

6)
As a condition to the effectiveness of this Amendment, Bank shall have received,
in form and substance satisfactory to Bank, the following:

a)this Amendment, duly executed by Borrower;
b)a warrant to purchase stock, duly executed by Borrower;
c)an officer’s certificate of Borrower with respect to incumbency and
resolutions authorizing the execution and delivery of this Amendment;
d)delivery of the Loan Advance/Paydown Request Form in accordance with Section
2.1 and satisfaction of all other conditions set forth in Section 3.2;
e)payment of the facility fee in accordance with Section 2.5 of the Agreement,
as amended hereby, and all Bank Expenses incurred through the date of this
Amendment, including Bank’s reasonable expenses for the documentation of this
Amendment and any UCC, good standing or intellectual property search or filing
fees, which may be debited from any of Borrower’s accounts; and
f)such other documents and completion of such other matters, as Bank may have
reasonably requested.
7)
Borrower agrees to use commercially reasonable efforts to provide a landlord
waiver, duly executed by Borrower and the applicable landlord, with respect to
its leased premises at 620 Memorial Drive, Suite 200, Cambridge, MA 02139, in
form satisfactory to Bank, within 90 days of the Third Amendment Date.

8)
Pursuant to Section 6.3 of the Agreement, Borrower hereby notifies Bank of
Inventory and Equipment held at Biose Industrie, 24, Avenue Georges Pompidou CS
70429 Arpajon-Sur-Cere, Aurillace Cedex, 1 15004, France, and pursuant to
Section 7.11 of the Agreement, Bank hereby approves of such location and waives
any requirement to provide a landlord or bailee waiver for such location.

[remainder of page intentionally left blank]

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

[SIGNATURE PAGE TO THIRD AMENDMENT]
IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first
date above written.

EVELO BIOSCIENCES, INC.
By:   /s/ Jennifer Glennon
Name:   Jennifer Glennon
Title:  Vice President, Finance and Operations
PACIFIC WESTERN BANK
By:   /s/ Stephen J. Burns
Name:   Stephen J. Burns
Title:   Vice President

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

SCHEDULE OF EXCEPTIONS

Permitted Indebtedness (Exhibit A)
None
Permitted Investments (Exhibit A) -
None
Permitted Liens (Exhibit A) -
None
Bank Accounts (Section 5.3) -
Checking Accounts:
SILICON VALLEY BANK
3003 TASMAN DRIVE
2ND FLOOR, MAIL SORT HF210
SANTA CLARA, CALIFORNIA 95054

Account Number: 3301272839-2
Purpose: Old Operating Account

COMERICA BANK
226 AIRPORT PARKWAY
SAN JOSE, CA 95110-4348

Account Number: 1894979291
Purpose: Operating Account

Account Number: 1894979291
Purpose: Money Market Account

Intellectual Property (Section 5.4) -
Patents:

Patents: 
Title
Country/Region
Patent No. (Application No.)
Issue Date (Filing Date)
PROBIOTIC AND PREBIOTIC COMPOSITIONS, AND METHODS OF USE THEREOF FOR TREATMENT
AND PREVENTION OF GRAFT VERSUS HOST DISEASE
United States of America
9,603,878 (14/968086)

McCarter Ref. EPI014-US1CN (01904)
3/28/17 (12/14/15)
PROBIOTIC COMPOSITIONS CONTAINING CLOSTRIDIALES FOR INHIBITING INFLAMMATION
United States of America
9,610,307 (14/952895)

McCarter Ref. EPI016 (02102)
4/4/17 (11/25/15)

Patent applications:
Title
Country/Region
Application no.
Filing date

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

PROBIOTIC AND PREBIOTIC COMPOSITIONS, AND METHODS OF USE THEREOF FOR MODULATION
OF THE MICROBIOME
United States of America
14/952891

McCarter Ref. 01802
11/25/15
PROBIOTIC AND PREBIOTIC COMPOSITIONS, AND METHODS OF USE THEREOF FOR MODULATION
OF THE MICROBIOME
Australia
2015353425

McCarter Ref. 01824
6/21/17
PROBIOTIC AND PREBIOTIC COMPOSITIONS, AND METHODS OF USE THEREOF FOR MODULATION
OF THE MICROBIOME
Canada
2973223

McCarter Ref. 01826
7/6/17
PROBIOTIC AND PREBIOTIC COMPOSITIONS, AND METHODS OF USE THEREOF FOR MODULATION
OF THE MICROBIOME
China
2015800745356

McCarter Ref. 01828
7/25/17
PROBIOTIC AND PREBIOTIC COMPOSITIONS, AND METHODS OF USE THEREOF FOR MODULATION
OF THE MICROBIOME
Europe
15816292.5

McCarter Ref. 01835
6/23/17
PROBIOTIC AND PREBIOTIC COMPOSITIONS, AND METHODS OF USE THEREOF FOR TREATMENT
OF GASTROINTESTINAL DISORDERS
United States of America
14/952894

McCarter Ref. 02002
11/25/15
USE OF MICROBIAL COMPOSITIONS IN THE TREATMENT AND PREVENTION OF ALLERGIES
United States of America
15/487280

McCarter Ref. 01306
4/13/17
PROBIOTIC AND PREBIOTIC COMPOSITIONS, AND METHODS OF USE THEREOF FOR TREATMENT
AND PREVENTION OF GRAFT VERSUS HOST DISEASE
United States of America
15/495522

McCarter Ref. 01905
4/24/17
PROBIOTIC AND PREBIOTIC COMPOSITIONS, AND METHODS OF USE THEREOF FOR TREATMENT
AND PREVENTION OF GRAFT VERSUS HOST DISEASE
United States of America
15/664310

McCarter Ref. 01906
7/31/17
PROBIOTIC COMPOSITIONS CONTAINING CLOSTRIDIALES FOR INHIBITING INFLAMMATION
United States of America
15/438271

McCarter Ref. 02103
2/21/17
COMBINATION THERAPIES FOR TREATING CANCER
(BCG)
PCT
PCT/US17/66701
12/15/17
(12/16/16)

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

METHODS OF TREATING CANCER USING PARABACTEROIDES
PCT
PCT/US17/66709
12/15/17
(12/16/16)
COMBINATION THERAPIES FOR TREATING MELANOMA
(BCG)
PCT
PCT/US17/66711
12/15/17
(12/16/16)
METHODS OF TREATING COLORECTAL CANCER USING PARABACTEROIDES GOLDSTEINII
PCT
PCT/US17/66713
12/15/17
(12/16/16)
METHODS OF TREATING CANCER
(intratumoral bacterial overabundance/underabundance)
United States of America
15/874153
1/18/18
METHODS OF TREATING CANCER
(intratumoral bacterial overabundance/underabundance)
PCT
PCT/US18/14209
1/18/18
METHODS OF TREATING CANCER
(intratumoral bacterial overabundance/underabundance)
United States of America
15/874157
1/18/18
METHODS OF TREATING CANCER
(intratumoral bacterial overabundance/underabundance)
PCT
PCT/US18/14164
1/18/18
METHODS OF TREATING CANCER USING PARABACTEROIDES
(same app. re-filed with figure)
United States of America
62/459033
2/14/17
METHODS OF TREATING CANCER USING BIFIDOBACTERIUM ANIMALIS SSP. LACTIS
(ES310)
United States of America
62/528669
7/5/17
POLYMER COMPOSITIONS
United States of America
62/538467
7/28/17
TREATING CANCER AND INFLAMMATION USING A BLAUTIA STRAIN
(ES1114)
United States of America
62/551554
8/29/17
BACTERIAL EXTRACELLULAR VESICLES
United States of America
62/556015
9/8/17
EXTRACELLULAR VESICLES FROM PREVOTELLA
United States of America
62/556020
9/8/17
TREATING CANCER USING A BLAUTIA STRAIN
(ES1114 labeling error corrected)
United States of America
62/573406
10/17/17
IDENTIFICATION OF BACTERIA FOR CANCER THERAPY
(IP-10)
United States of America
62/572139
10/13/17
MONOCLONAL MICROBIAL POPULATIONS
United States of America
62/572144
10/13/17
SELECTED BACTERIA WITH IMPROVED PROPERTIES
United States of America
62/582552
11/7/17

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

COMPOSITIONS AND METHODS FOR TREATING IMMUNE DISORDERS USING A BLAUTIA STRAIN
United States of America
62/585782
11/14/17
COMPOSITIONS AND METHODS FOR TREATING IMMUNE DISORDERS USING A LACTOCOCCUS
LACTIS CREMORIS STRAIN
(EDP1066/ES977)
United States of America
62/586604
11/15/17
COMPOSITIONS AND METHODS FOR TREATING IMMUNE DISORDERS USING LACHNOSPIRACEAE
BACTERIA
United States of America
PENDING
1/31/18

 
Section 2.8(c)(i)
EVELO LICENSED PATENTS (U. CHICAGO)
Title
Country/Region
Patent No. (Application No.)
Issue Date (Filing Date)
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
United States of America
9,855,302
(15/170,284)
1/2/18 (6/3/16)

Title
Country/Region
Application no.
Filing Date
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
United States of America
15/718,735
9/28/17
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Argentina
P160101610
6/3/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Taiwan
105117266 TW
6/4/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Venezuela
2016000241
6/4/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
United States of America
PCT/US16/35228
6/4/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Uruguay
36701
6/9/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Australia
2016270750
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Brazil
BR 112017025813-7
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Canada
2987129
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Chile
2017-3024
Effective filing date 6/1/16

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

TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
China
2.0168E+11
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Europe
16804316.4EPO
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
India
App. No. Pending
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Israel 
255940
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Japan
2017-561803
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Republic of Korea
10-2017-7037299
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Mexico
App. No. Pending
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
New Zealand
737782
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Peru
002514-2017/DIN
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Russia
2017141448
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Singapore
11201709693W
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
South Africa
2017/07986
Effective filing date 6/1/16
TREATMENT OF CANCER BY MANIPULATION OF COMMENSAL MICROFLORA
Ukraine
a2017 11648
Effective filing date 6/1/16

EVELO LICENSED PATENTS (MAYO):
Title
Country/Region
Application no.
Issue Date (Filing Date)
PREVOTELLA HISTICOLA PREPARATIONS AND THE TREATMENT OF AUTOIMMUNE CONDITIONS
United States of America
8,617,536
12/31/13
(10/27/10)
PREVOTELLA HISTICOLA PREPARATIONS AND THE TREATMENT OF AUTOIMMUNE CONDITIONS
United States of America
9,005,603
3/14/15
(11/21/13)
PREVOTELLA HISTICOLA PREPARATIONS AND THE TREATMENT OF AUTOIMMUNE CONDITIONS
United States of America
9,555,066
1/31/17
(3/10/15)
PREVOTELLA HISTICOLA PREPARATIONS AND THE TREATMENT OF AUTOIMMUNE CONDITIONS
United States of America
9,801,914
10/31/2017
(12/20/16)

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

EVELO LICENSED PATENT APPLICATIONS (MAYO):
Title
Country/Region
Application no.
Filing Date
PREVOTELLA HISTICOLA PREPARATIONS AND THE TREATMENT OF AUTOIMMUNE CONDITIONS
United States of America
15/715,471
9/26/17

Copyright registrations or applications: None.
Trademark, service mark and domain name registrations or applications:
Trademark and/or service marks:
Country
Literal Mark
Application #
Application Date
US
ONCOBIOTIC
86808587
11/3/15
US
EVELO
86582465
3/31/15
US
EPIVA (word)
86588745
4/6/15
US
EPIVA & Design
86588763
4/6/15
Hong Kong
EPIVA (word)
303556026
10/6/15
EU
EPIVA (word)
14650972
10/6/15
CH
EPIVA (word)
62242/2015
10/6/15

Domain names:
evelobio.com
evelobiosciences.com
evelotx.com
bacterialtherapeutics.com
bugdrugs.com
immunobiome.com
immunomicrobials.com
immunomicrobiome.com
microbialdrugs.com
microbialtx.com
microbiomedisease.com
microbiomedrugs.com
microbiomestudies.com
microbiometx.com

Prior Names (Section 5.5) -
VL28, Inc.
VL 28, LLC
VL 31, Inc.

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

Epiva Therapeutics, Inc.
Epiva Biosciences, Inc.
Evelo Therapeutics, Inc.

The principal place of business is 620 Memorial Drive, Cambridge, MA 02139

Litigation (Section 5.6) -
None
Inbound Licenses (Section 5.12) -
Exclusive License Agreement between University of Chicago and Evelo for a
royalty bearing worldwide exclusive license to the Patent Rights within the
Field of Treatment of Cancer by Manipulation of Commensal Microflora. Effective
Date March 10, 2016.
Exclusive Research and License Agreement between Mayo Foundation for Medical
Education and Research and Evelo to advance immune-microbiome-based therapies
for cancer. Effective Date June 10, 2016.
Patent License Agreement, effective as of August 6, 2017, by and between Medical
Education and Research for Prevotella histicola strain B-50329 and any progeny
and derivatives thereof.
Equipment at other locations (Section 7.11)
The following equipment is installed with our strategic manufacturing partner
Biose Industrie, Rue des Freres Lumieres 15130 Arpajon sur Cere France:

Equipment
Cost
Beckman Coulter TN MULTISIZER 4E
€
48,077.00

Roche Diagnostic - Control A level 2 Bio
€
51,279.24

CERTIFICATE OF OFFICER
The undersigned duly elected and qualified Secretary of evelo biosciences, Inc.
(the "Company") does hereby certify, solely in its capacity as an officer of the
Company and not in its individual capacity, that the following is a true and
correct copy of certain resolutions adopted by the Company’s Board of Directors
in accordance with applicable law and the Company’s bylaws, and that such
resolutions are now unmodified and in full force and effect:
BE IT RESOLVED, that:
1)
Any one (1) of the following, duly elected officers of the Company (each, an
"Authorized Officer") whose genuine original signature appears next to his or
her name is authorized to act for, on behalf of, and in the name of the Company
in connection with the resolutions below:

Title
Name
Authorized Signature
____________________________
____________________________
____________________________
____________________________
____________________________
____________________________
____________________________
____________________________
____________________________
____________________________
____________________________
____________________________

2)
Any Authorized Officer may:

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

(a)Borrow money from time to time from Pacific Western Bank ("Bank"), and may
negotiate and procure loans, letters of credit, foreign exchange contracts and
other financial accommodations from Bank, including without limitation, that
certain Loan and Security Agreement dated as of August 15, 2015, and also to
execute and deliver to Bank one or more renewals, extensions, or modifications
thereof, including, without limitation, that certain First Amendment to Loan and
Security Agreement dated June 14, 2017, that certain Second Amendment to Loan
and Security Agreement, dated August 18, 2017, and that certain Third Amendment
to Loan and Security Agreement, dated on or about the date hereof;
(b)Give security for any liabilities of the Company to Bank by grant, security
interest, assignment, lien, deed of trust or mortgage upon any real or personal
property, tangible or intangible of the Company;
(c)Purchase, sell, exchange, assign, endorse for transfer and/or deliver
certificates and/or instruments representing stocks, bonds, evidences of
Indebtedness or other securities owned by the Company, whether or not registered
in the name of the Company;
(d)Discount with Bank, commercial or other business paper belonging to the
Company made or drawn by or upon third parties, without limit as to amount;
(e)Authorize and direct Bank to pay the proceeds of any such loans or discounts
as directed by the persons so authorized to sign;
(f)Issue a warrant or warrants to purchase the Company’s capital stock; and
(g)Execute and deliver in form and content as may be required by Bank any and
all notes, evidences of indebtedness, applications for letters of credit,
guaranties, subordination agreements, loan and security agreements, financing
statements, assignments, liens, deeds of trust, mortgages, trust receipts and
other agreements, instruments or documents to carry out the purposes of these
resolutions, any or all of which may relate to all or to substantially all of
the Company’s property and assets;
3)
The Authorized Officers may designate additional or alternate individuals as
being authorized to request loan advances, to do and perform such other acts and
things, to pay any and all fees and costs, and to execute and deliver such other
documents and agreements as he or she may in his or her discretion deem
reasonably necessary or proper in order to carry into effect the provisions of
these resolutions.

4)
Any and all acts authorized pursuant to these resolutions and performed prior to
the passage of these resolutions are hereby ratified and approved, and the
authority conferred herein may be exercised singly by any such officer, and
these resolutions shall continue in full force and effect until written notice
of modification or revocation is received and accepted by Bank (such notice to
have no effect on any action previously taken by Bank in reliance on these
resolutions). Bank may rely upon any form of notice, which it in good faith
believes to be genuine or what it purports to be.

5)
The resolutions are in full force and effect as of the date of this Certificate
and are intended to replace, as of this date, any resolutions previously given
by the Company to Bank in connection with the matters described herein; these
resolutions and any borrowings or financial accommodations under these
resolutions have been properly noted in the corporate books and records, and
have not been rescinded, revoked or modified; neither the foregoing resolutions
nor any actions to be taken pursuant to them are or will be in contravention of
any provision of the certificate of incorporation or bylaws of the Company or of
any agreement, indenture or other instrument to which the Company is a party or
by which it is bound; and to the extent the certificate of incorporation or
bylaws of the Company or any agreement, indenture or other instrument to which
the Company is a party or by which it is bound require the vote or consent of
shareholders of the Company to authorize any act, matter or thing described in
the foregoing resolutions, such vote or consent has been obtained.

In Witness Whereof, I have affixed my name as Secretary and have caused the
corporate seal (where available) of said Company to be affixed as of February 7,
2018.

Secretary*
*If the certifying officer is designated as the only signer in these resolutions
then another corporate officer must also sign.
_____________________________

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

FOURTH AMENDMENT
TO
LOAN AND SECURITY AGREEMENT
This Fourth Amendment to Loan and Security Agreement (this "Amendment") is
entered into as of March 14, 2018, by and between PACIFIC WESTERN BANK, a
California state chartered bank ("Bank"), and EVELO BIOSCIENCES, INC.
("Borrower").
RECITALS
Borrower and Bank are parties to that certain Loan and Security Agreement dated
as of August 15, 2016 (as amended from time to time, the "Agreement"). The
parties desire to amend the Agreement in accordance with the terms of this
Amendment.
NOW, THEREFORE, the parties agree as follows:
1)
The following defined terms in Exhibit A to the Agreement are hereby amended and
restated, as follows:

"Credit Card Line" means a Credit Extension of up to $250,000, to be used
exclusively for the provision of Credit Card Services.
"Credit Card Maturity Date" means March 13, 2019.
2)
Unless otherwise defined, all initially capitalized terms in this Amendment
shall be as defined in the Agreement. The Agreement, as amended hereby, shall be
and remain in full force and effect in accordance with its respective terms and
hereby is ratified and confirmed in all respects. Except as expressly set forth
herein, the execution, delivery, and performance of this Amendment shall not
operate as a waiver of, or as an amendment of, any right, power, or remedy of
Bank under the Agreement, as in effect prior to the date hereof. Borrower
ratifies and reaffirms the continuing effectiveness of all agreements entered
into in connection with the Agreement.

3)
Borrower represents and warrants that the representations and warranties
contained in the Agreement are true and correct as of the date of this
Amendment.

4)
This Amendment may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one
instrument.

5)
As a condition to the effectiveness of this Amendment, Bank shall have received,
in form and substance satisfactory to Bank, the following:

a)
this Amendment, duly executed by Borrower;

b)
payment of all Bank Expenses, including Bank’s expenses for the documentation of
this amendment and any related documents, and any UCC, good standing or
intellectual property search or filing fees, which may be debited from any of
Borrower's accounts; and

c)
such other documents and completion of such other matters, as Bank may
reasonably deem necessary or appropriate.

[Signature Page Follows]

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

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first
date above written.

EVELO BIOSCIENCES, INC.
 PACIFIC WESTERN BANK

By: _/s/ Jennifer Glennon______________

By: _/s/ John Orlando_________________
Name: _Jennifer Glennon______________
Title: _VP, Finance and Operations______
Name: _John Orlando_________________
 Title: _Vice President________________
 
 

[Signature Page to Fourth Amendment to Loan and Security Agreement]

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

FIFTH AMENDMENT TO
LOAN AND SECURITY AGREEMENT
This Fifth Amendment to Loan and Security Agreement (this "Amendment") is made
and entered into as of April 18, 2019 by and between PACIFIC WESTERN BANK, a
California state chartered bank ("Bank"), EVELO BIOSCIENCES, INC. (individually
or collectively, as the context may require, "Borrower").
RECITALS
Borrower and Bank are parties to that certain Loan and Security Agreement dated
as of August 15, 2016, as amended by that certain First Amendment to Loan and
Security Agreement, dated as of June 14, 2017, that certain Second Amendment to
Loan and Security Agreement, dated as of August 18, 2017, that certain Third
Amendment to Loan and Security Agreement, dated as of February 7, 2018, and that
certain Fourth Amendment to Loan and Security Agreement, dated as of March 14,
2018 (as further amended, restated, supplemented or otherwise modified from time
to time, the "Agreement"). The parties desire to amend the Agreement in
accordance with the terms of this Amendment.
NOW, THEREFORE, the parties agree as follows:
1)
Amendments to Agreement.

a)
Section 6.6 of the Agreement is hereby amended by adding the following sentence
after the last sentence thereof: "Borrower shall not permit the aggregate
balance of all deposit accounts maintained by UK Subsidiary to exceed $350,000,
without causing any excess above such maximum balance to be transferred to a
deposit account maintained by Borrower with Bank within five (5) Business Days,
and shall deliver monthly account statements for UK Subsidiary within five (5)
Business Days of receipt."

b)
Section 6.10 of the Agreement is hereby amended by adding the following sentence
after the last sentence thereof: "Notwithstanding the foregoing, UK Subsidiary
shall not be required to become a secured guarantor with respect to the
Obligations; provided that Borrower shall not permit UK Subsidiary to maintain
non-cash assets with an aggregate value in excess of $50,000 at any time,
provided that the foregoing limitation shall not operate to restrict the amount
of intercompany accounts receivables of UK Subsidiary arising from payments due
to UK Subsidiary from Borrower."

c)
Section 7.11 of the Agreement is hereby amended by adding the following sentence
after the last sentence thereof: "Borrower shall not permit assets located in
France to exceed an aggregate value up to $1,000,000, provided that, subject to
compliance with the foregoing, no bailee waivers or other steps to perfect
Bank’s security interest in such assets shall be required."

d)
Exhibit A of the Agreement is hereby amended to amend or add the definitions set
forth below in appropriate alphabetical order, as applicable:

"Credit Card Line" means a Credit Extension of up to $300,000 to be used
exclusively for the provision of Credit Card Services.
"Credit Card Maturity Date" means April 12, 2020.
"UK Subsidiary" means a new Subsidiary of Borrower organized under the laws of
England and Wales.
e)
Clause (d) of the defined term "Permitted Investments" is hereby amended and
restated to read as follows:

(d)    Investments (i) by Subsidiaries in or to other Subsidiaries or Borrower,
(ii) by Borrower in Subsidiaries (other than UK Subsidiary) not to exceed
$300,000 in the aggregate in any fiscal year, (iii) by Borrower in UK Subsidiary
not to exceed $2,000,000 in the aggregate for the twelve (12) months then ended,
measured quarterly on the last day of each quarter, provided that, for purposes
of the foregoing, to the extent amounts received by UK Subsidiary are remitted
to Borrower within five (5) Business Days, such amounts shall be excluded, and
(iv) by Borrower in any MSC Subsidiary otherwise permitted in accordance with
the terms of this Agreement;
f)
Exhibit D of the Agreement is hereby amended and restated as set forth in
Exhibit D attached hereto.

Unless otherwise defined, all initially capitalized terms in this Amendment
shall be as defined in the Agreement. The Agreement, as amended hereby, shall be
and remain in full force and effect in accordance with its respective terms and
hereby is ratified and confirmed in all respects. Except as expressly set forth
herein, the execution, delivery, and performance of this Amendment shall not
operate as a waiver of, or as an amendment of, any right, power, or remedy of
Bank under the Agreement, as in effect prior to the date hereof. Borrower
ratifies and reaffirms the continuing effectiveness of all agreements entered
into in connection with the Agreement.

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2)
Borrower represents and warrants that:

a)
The execution, delivery and performance of the Agreement and this Amendment are
within Borrower’s powers, have been duly authorized, and are not in conflict
with, nor constitute a breach of any provision contained in Borrower’s
Certificate of Incorporation or Bylaws, nor will they constitute an event of
default under any material agreement by which Borrower is bound. Borrower is not
in default under any agreement by which it is bound, except to the extent such
default would not reasonably be expected to cause a Material Adverse Effect; and

b)
The representations and warranties of Borrower contained in the Agreement are
true and correct in all material respects as of the date of this Amendment
(provided, however, that those representations and warranties expressly
referring to another date shall be true, correct and complete in all material
respects as of such date).

3)
This Amendment may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one
instrument.

4)
The provisions of Sections 11 and 12 are hereby incorporated herein, provided
that all references to the "Agreement", shall mean the Agreement, as amended by
this Amendment.

5)
As a condition to the effectiveness of this Amendment, Bank shall have received,
in form and substance satisfactory to Bank, the following:

a)this Amendment, duly executed by Borrower;
b)payment of all Bank Expenses incurred through the date of this Amendment,
including Bank’s reasonable expenses for the documentation of this Amendment and
any UCC, good standing or intellectual property search or filing fees, which may
be debited from any of Borrower’s accounts; and
c)such other documents and completion of such other matters, as Bank may have
reasonably requested.
[remainder of page intentionally left blank]

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[SIGNATURE PAGE TO FIFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT]
IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first
date above written.

EVELO BIOSCIENCES, INC.
By: __/s/ Jonathan Poole
Name:    Jonathan Poole
Title:   Chief Financial Officer

PACIFIC WESTERN BANK
By: __/s/Joseph Holmes Dague
Name: _Joseph Holmes Dague
Title: __Senior Vice President

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EXHIBIT D
Compliance Certificatea5thamendmenttolsa418196.jpg
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