Exhibit 10.1

 

FIFTH AMENDMENT TO
LOAN AND SECURITY AGREEMENT

 

THIS FIFTH AMENDMENT to Loan and Security Agreement (this “Amendment”) is
entered into as of July 20, 2016, by and among OXFORD FINANCE LLC, a Delaware
limited liability company with an office located at 133 North Fairfax Street,
Alexandria, Virginia 22314 (“Oxford”), as collateral agent (in such capacity,
“Collateral Agent”), the Lenders listed on Schedule 1.1 of the Loan Agreement
(as defined below) or otherwise party thereto from time to time including Oxford
in its capacity as a Lender and SILICON VALLEY BANK, a California corporation
with an office located at 3003 Tasman Drive, Santa Clara, CA 95054 (“Bank” or
“SVB”) (each a “Lender” and collectively, the “Lenders”), and TROVAGENE, INC., a
Delaware corporation, with offices located at 11055 Flintkote Ave, Suite B, San
Diego, CA 92121 (“Borrower”).

 

RECITALS

 

A.                                    Collateral Agent, Lenders and Borrower
have entered into that certain Loan and Security Agreement dated as of June 30,
2014 (as amended from time to time, including but without limitation by that
certain First Amendment to Loan and Security Agreement dated as of December 18,
2014, that certain Second Amendment to Loan and Security Agreement dated as of
May 6, 2015, that certain Consent and Third Amendment to Loan and Security
Agreement dated as of November 17, 2015, and that certain Consent and Fourth
Amendment to Loan and Security Agreement dated as of June 6, 2016, the “Loan
Agreement”).

 

B.                                    Lenders have extended credit to Borrower
for the purposes permitted in the Loan Agreement.

 

C.                                    Borrower has requested that Collateral
Agent and Lenders amend certain provisions of the Loan Agreement as more fully
set forth herein.

 

D.                                    Collateral Agent and Lenders have agreed
to amend certain provisions of the Loan Agreement, but only to the extent, in
accordance with the terms, subject to the conditions and in reliance upon the
representations and warranties set forth below.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing recitals and other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, and intending to be legally bound, the parties hereto agree as
follows:

 

1.                                      Definitions.  Capitalized terms used but
not defined in this Amendment shall have the meanings given to them in the Loan
Agreement.

 

2.                                      Amendments to Loan Agreement.

 

2.1                               Section 2.2 (Term Loans).  Sections
2.2(a)-(b) of the Loan Agreement are amended and restated as follows:

 

“(a)                           Availability.

 

(i)                                     Subject to the terms and conditions of
this Agreement, Lenders, severally and not jointly, loaned to Borrower term
loans on the Effective Date according to each Lender’s Term Loan Commitment as
set forth in Schedule 1.1 hereto as in effect immediately prior to the Fifth
Amendment Effective Date (such term loans are hereinafter referred to
collectively as the “Original Term Loans”).

 

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(ii)                                  Subject to the terms and conditions of
this Agreement, Lenders agree, severally and not jointly, to make term loans to
Borrower on the Fifth Amendment Effective Date as follows:

 

(1)                                 SVB shall make a term loan to Borrower in an
amount of Seven Million Five Hundred Thousand Dollars ($7,500,000.00) (the “SVB
New Loan”), the proceeds of which will be deemed to repay Obligations owing from
Borrower to SVB in respect of the Original Term Loans.

 

(2)                                 Oxford shall make a term loan to Borrower in
an amount equal to One Million Three Hundred Ninety-Six Thousand One Hundred
Sixty-Six and 96/100 Dollars ($1,396,166.96) (the “Oxford New Loan”, and
together with (X) the Obligations owning from Borrower to Oxford in respect of
the Original Term Loans, including those certain Secured Promissory Notes dated
June 30, 2014, with the current principal balances of Three Million Six Hundred
Sixty-Two Thousand Two Hundred Ninety-Nine and 81/100 Dollars ($3,662,299.81)
and Two Million Four Hundred Forty-One Thousand Five Hundred Thirty-Three and
23/100 Dollars ($2,441,533.23) and (Y) the SVB New Loan, each a “Term Loan” and
collectively, the “Term Loans”).  Lenders agree to waive the Prepayment Fee
otherwise due and payable to Lenders on the Fifth Amendment Effective Date with
respect to the repayment of the Original Term Loans on the Fifth Amendment
Effective Date.  After repayment, no Term Loan may be re-borrowed.

 

(b)                                 Repayment.  Borrower shall make monthly
payments of interest only commencing on the first (1st) Payment Date following
the Funding Date of the Term Loans, and continuing on the Payment Date of each
successive month thereafter through and including the Payment Date immediately
preceding the Amortization Date.  Borrower agrees to pay, on the Funding Date of
the Term Loans, any initial partial monthly interest payment otherwise due for
the period between the Funding Date of the Term Loans and the first Payment Date
thereof.  Commencing on the Amortization Date, and continuing on the Payment
Date of each month thereafter, Borrower shall make consecutive equal monthly
payments of principal, together with applicable interest, in arrears, to each
Lender, as calculated by Collateral Agent (which calculations shall be deemed
correct absent manifest error) based upon: (1) the amount of such Lender’s
Term Loan, (2) the effective rate of interest, as determined in Section 2.3(a),
and (3) a repayment schedule equal to (x) if the Amortization Date is March 1,
2017, thirty six (36) months; and (y) if the Amortization Date is September 1,
2017, thirty (30) months.  All unpaid principal and accrued and unpaid interest
with respect to the Term Loans is due and payable in full on the Maturity Date. 
The Term Loans may only be prepaid in accordance with Sections 2.2(c) and
2.2(d).”

 

2.2                               Section 2.3 (Payment of Interest on the Credit
Extensions).  Sections 2.3(a)-(c) of the Loan Agreement are amended and restated
as follows:

 

“(a)                           Interest Rate.  Subject to Section 2.3(b), the
principal amount outstanding under the Term Loans shall accrue interest at a
floating per annum rate equal to the Basic Rate, determined by Collateral Agent,
which interest shall be payable monthly in arrears in accordance with Sections
2.2(b) and 2.3(e). Interest shall accrue on each Term Loan commencing on, and
including, the Funding Date of such Term Loan, and shall accrue on the principal
amount outstanding under such Term Loan through and including the day on which
such Term Loan is paid in full.

 

(b)                                 Default Rate. Immediately upon the
occurrence and during the continuance of an Event of Default, Obligations shall
accrue interest at a floating per annum rate equal to the rate that is otherwise
applicable thereto plus five percentage points (5.00%) (the “Default Rate”). 
Payment or acceptance of the increased interest rate provided in this
Section 2.3(b) is not a permitted alternative to timely payment and shall not
constitute a waiver of any Event of Default or otherwise prejudice or limit any
rights or remedies of Collateral Agent.

 

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(c)                                  360-Day Year.  Interest shall be computed
on the basis of a three hundred sixty (360) day year, and the actual number of
days elapsed.”

 

2.3                               Section 2.5 (Fees).  A new Section 2.5(d) is
added to the Loan Agreement as follows:

 

“(d)                           Fifth Amendment Final Payment.  A final payment
as of the Fifth Amendment Effective Date in an amount equal to Five Hundred
Twenty Five Thousand Dollars ($525,000.00) to Oxford, in its capacity as a
Lender, and Five Hundred Twenty Five Thousand Dollars ($525,000.00) to SVB on
the Fifth Amendment Effective Date (as determined under the Loan Agreement as in
effect immediately prior to the Fifth Amendment Effective Date), and provided
that such fee shall not reduce the fee otherwise due under Section 2.5(a).”

 

2.4                               Section 10 (Notices).  Section 10 of the Loan
Agreement is amended by deleting the notice information for “Cooley LLP” and
substituting in lieu thereof the following:

 

with a copy (which shall not constitute notice) to:

VLP Law Group LLP
2947 Eskridge Road
Fairfax, VA 22031

 

Attn: Denise Zack

 

Fax: (703) 260-6551

 

Email: DZack@vlplawgroup.com

 

2.5                               Section 13.1 (Definitions).  The following
definitions are added to or amended and restated in Section 13.1 of the Loan
Agreement as follows:

 

“Amortization Date” is, (x) if the Interest Only Extension Event has not
occurred, March 1, 2017, and (y) if the Interest Only Extension Event has
occurred, September 1, 2017.

 

“Basic Rate” is, with respect to the Term Loans, the per annum rate of interest
(based on a year of three hundred sixty (360) days) equal to the greater of
(i) seven and a quarter percent (7.25%) and (ii) the sum of (a) the Prime Rate
on the last Business Day of the month that immediately precedes the month in
which the interest will accrued (which shall not, in any case, be less than
three and a half percent (3.50%)), plus (b) three and three quarters percent
(3.75%).  Notwithstanding the foregoing, the Basic Rate for the Term Loans for
the period from the Fifth Amendment Effective Date through and including
July 31, 2016, shall be seven and a quarter percent (7.25%).”

 

“Final Payment Percentage” is seven and one half percent (7.50%).

 

“Fifth Amendment Effective Date” means July 20, 2016.

 

“Interest Only Extension Event” means Collateral Agent’s and Lenders’ receipt of
evidence in form and substance reasonably satisfactory to Collateral Agent and
Lenders that (a) Borrower has successfully secured agreements with insurance
providers/networks resulting in one hundred sixty-eight million (168,000,000)
aggregate U.S. covered lives and (b) Borrower’s Trovera EGFR, KRAS and BRAF
products have been placed on a list of diagnostics tests at a major U.S. cancer
center reasonably satisfactory to Lenders.

 

“Maturity Date” is February 1, 2020.

 

“Original Term Loans” is defined in Section 2.2(a)(i) hereof.

 

“Oxford New Loan” is defined in Section 2.2(a)(ii)(2) hereof.

 

“Prepayment Fee” is, with respect to any Term Loan subject to prepayment prior
to the Maturity

 

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Date, whether by mandatory or voluntary prepayment, acceleration or otherwise,
an additional fee payable to the Lenders in amount equal to:

 

(i)                                     for a prepayment made on or after the
Fifth Amendment Effective Date through and including the first anniversary of
the Fifth Amendment Effective Date, three percent (3.00%) of the principal
amount of such Term Loan prepaid;

 

(ii)                                  for a prepayment made after the first
anniversary of the Fifth Amendment Effective Date through and including the
second anniversary of the Fifth Amendment Effective Date, two percent (2.00%) of
the principal amount of the Term Loans prepaid; and

 

(iii)                               for a prepayment made after the second
anniversary of the Fifth Amendment Effective Date and prior to the Maturity
Date, one percent (1.00%) of the principal amount of the Term Loans prepaid.

 

“Prime Rate” is the rate of interest per annum from time to time published in
the money rates section of The Wall Street Journal or any successor publication
thereto as the “prime rate” then in effect; provided that if such rate of
interest, as set forth from time to time in the money rates section of The Wall
Street Journal, becomes unavailable for any reason as determined by Lenders, the
“Prime Rate” shall mean the rate of interest per annum announced by Bank as
their prime rate in effect (such Bank announced Prime Rate not being intended to
be the lowest rate of interest charged by Bank in connection with extensions of
credit to debtors).

 

“SVB New Loan” is defined in Section 2.2(a)(ii)(1) hereof.

 

2.6                               Section 13 (Definitions).  The following term
and its definition set forth in Section 13.1 are deleted in their entirety:

 

“Treasury Note Maturity”

 

2.7                               Schedule 1.1 to the Loan Agreement is replaced
with Schedule 1.1 attached hereto.

 

2.8                               The original Secured Promissory Note dated
June 30, 2014 issued by Borrower in favor of SVB hereby is cancelled, null and
void and of no further force and effect.  The original Secured Promissory Notes
dated June 30, 2014 issued by Borrower in favor of Oxford hereby are amended and
restated to reflect the outstanding principal balances and date as of the Fifth
Amendment Effective Date.

 

3.                                      Limitation of Amendment.

 

3.1                               The amendments set forth in Section 2 above
are effective for the purposes set forth herein and shall be limited precisely
as written and shall not be deemed to (a) be a consent to any amendment, waiver
or modification of any other term or condition of any Loan Document, or
(b) otherwise prejudice any right or remedy which Collateral Agent or any Lender
may now have or may have in the future under or in connection with any Loan
Document.

 

3.2                               This Amendment shall be construed in
connection with and as part of the Loan Documents and all terms, conditions,
representations, warranties, covenants and agreements set forth in the Loan
Documents, except as herein amended, are hereby ratified and confirmed and shall
remain in full force and effect.

 

4.                                      Representations and Warranties.  To
induce Collateral Agent and Lenders to enter into this Amendment, Borrower
hereby represents and warrants to Collateral Agent and Lenders as follows:

 

4.1                               Immediately after giving effect to this
Amendment (a) the representations and warranties contained in the Loan Documents
are true, accurate and complete in all material respects as of the date hereof

 

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(except to the extent such representations and warranties relate to an earlier
date, in which case they are true and correct as of such date), and (b) no Event
of Default has occurred and is continuing;

 

4.2                               Borrower has the power and authority to
execute and deliver this Amendment and to perform its obligations under the Loan
Agreement, as amended by this Amendment;

 

4.3                               The organizational documents of Borrower
delivered to Collateral Agent and Lenders on the Effective Date, or subsequent
thereto, remain true, accurate and complete and have not been amended,
supplemented or restated and are and continue to be in full force and effect;

 

4.4                               The execution and delivery by Borrower of this
Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, have been duly authorized;

 

4.5                               The execution and delivery by Borrower of this
Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, do not and will not contravene (a) any
law or regulation binding on or affecting Borrower, (b) any contractual
restriction with a Person binding on Borrower, (c) any order, judgment or decree
of any court or other governmental or public body or authority, or subdivision
thereof, binding on Borrower, or (d) the organizational documents of Borrower;

 

4.6                               The execution and delivery by Borrower of this
Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, do not require any order, consent,
approval, license, authorization or validation of, or filing, recording or
registration with, or exemption by any governmental or public body or authority,
or subdivision thereof, binding on Borrower, except as already has been obtained
or made; and

 

4.7                               This Amendment has been duly executed and
delivered by Borrower and is the binding obligation of Borrower, enforceable
against Borrower in accordance with its terms, except as such enforceability may
be limited by bankruptcy, insolvency, reorganization, liquidation, moratorium or
other similar laws of general application and equitable principles relating to
or affecting creditors’ rights.

 

5.                                      Integration.  This Amendment and the
Loan Documents represent the entire agreement about this subject matter and
supersede prior negotiations or agreements.  All prior agreements,
understandings, representations, warranties, and negotiations between the
parties about the subject matter of this Amendment and the Loan Documents merge
into this Amendment and the Loan Documents.

 

6.                                      Counterparts.  This Amendment may be
executed in any number of counterparts and all of such counterparts taken
together shall be deemed to constitute one and the same instrument.

 

7.                                      Effectiveness.  This Amendment shall be
deemed effective upon the due execution and delivery to Collateral Agent and
Lenders, in form and substance satisfactory to Collateral Agent and each Lender,
such documents, and completion of such other matters, as Collateral Agent and
each Lender may reasonably deem necessary or appropriate, including, without
limitation:

 

a)             this Amendment by each party hereto;

 

b)             warrants to purchase stock by Borrower in favor of each Lender;

 

c)              a Secured Promissory Note in favor of SVB;

 

d)             a Secured Promissory Note and Amended and Restated Secured
Promissory Notes in favor of Oxford;

 

e)              an updated Corporate Borrowing Certificate by Borrower;

 

f)               a disbursement letter by each party thereto;

 

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g)              a Loan Payment/Advance Request from;

 

h)             Borrower’s payment of the final payment fee in an amount equal to
Five Hundred Twenty Five Thousand Dollars ($525,000.00) to Oxford, in its
capacity as a Lender, and Five Hundred Twenty Five Thousand Dollars
($525,000.00) to SVB; and

 

i)                 Borrower’s payment of all Lenders’ Expenses incurred through
the date of this Amendment.

 

[Balance of Page Intentionally Left Blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered as of the date first written above.

 

BORROWER:

 

 

 

TROVAGENE, INC.

 

 

 

 

 

By

 

 

Name:

 

 

Title:

 

 

 

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

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered as of the date first written above.

 

 

COLLATERAL AGENT AND LENDER:

 

 

 

OXFORD FINANCE LLC

 

 

 

 

 

 

 

By

 

 

Name:

 

 

Title:

 

 

 

 

 

 

 

 

LENDER:

 

 

 

SILICON VALLEY BANK

 

 

 

 

 

 

 

By

 

 

Name:

 

 

Title:

 

 

 

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

 

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