EX-10.42



 Exhibit 10.42 

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT 

THIS AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Agreement”) dated as of April 30, 2015 (the
“Effective Date”) between SILICON VALLEY BANK, a California corporation (“Bank”), and MOLECULAR TEMPLATES, INC., a Delaware corporation (“Borrower”), provides the terms on which Bank
shall lend to Borrower and Borrower shall repay Bank. The parties agree as follows: 
 Recitals 

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of April 7, 2014 (as amended from time to
time, the “Prior Loan Agreement”). 
 B. Borrower has requested, and Bank has agreed, to replace, amend and restate
the Prior Loan Agreement in its entirety. Bank and Borrower hereby agree that the Prior Loan Agreement is amended and restated in its entirety as follows: 
  

	1.	ACCOUNTING AND OTHER TERMS 

 Accounting terms not defined in this Agreement shall be
construed following GAAP. Calculations and determinations must be made following GAAP. Capitalized terms not otherwise defined in this Agreement shall have the meanings set forth in Section 13. All other terms contained in this Agreement,
unless otherwise indicated, shall have the meanings provided by the Code to the extent such terms are defined therein. 
  

	2.	LOAN AND TERMS OF PAYMENT 

 2.1 Promise to Pay. Borrower hereby
unconditionally promises to pay Bank the outstanding principal amount of all Credit Extensions and accrued and unpaid interest thereon as and when due in accordance with this Agreement. 

2.1.1 Growth Capital Loan. 

(a) Availability. Subject to the terms and conditions of this Agreement, Bank agrees to make advances to Borrower (each a
“Growth Capital Advance” and collectively the “Growth Capital Advances”), from time to time, prior to the Growth Capital Commitment Termination Date (Third Tranche), in an aggregate amount not to exceed the Growth
Capital Loan Commitment. 
 (i) Seven Hundred Fifty Thousand Dollars ($750,000) of the Growth Capital Loan Commitment (the “First
Tranche”) will be advanced on the Effective Date. After repayment, the Growth Capital Advance under the First Tranche may not be reborrowed. 

(ii) An additional Two Million Two Hundred Fifty Thousand Dollars ($2,250,000) of the Growth Capital Loan Commitment (the “Second
Tranche”) shall be available through the Growth Capital Commitment Termination Date (Second Tranche). After repayment, no Growth Capital Advance under the Second Tranche may be reborrowed. 







 (iii) The remaining Three Million Dollars ($3,000,000) of the Growth Capital Loan Commitment
(the “Third Tranche”) shall be available, at the sole discretion of Bank, from the later of (A) the Third Tranche Milestone or (B) June 30, 2015, through the Growth Capital Commitment Termination Date (Third Tranche).
After repayment, no Growth Capital Advance under the Third Tranche may be reborrowed. 
 (b) Repayment of Growth Capital Advances.

 (i) Interest-Only Payments. For each Growth Capital Advance, Borrower shall make monthly payments of interest-only commencing on
the first (1st) Business Day of the first (1st) month following the month in which the Funding Date occurs with respect to such Growth Capital
Advance and continuing thereafter during the Interest-Only Period, on the first (1st) Business Day of each successive month. 

(ii) Principal and Interest Payments. For each Growth Capital Advance outstanding as of the last day of the Interest-Only Period,
Borrower shall make thirty-six (36) (thirty (30) if Borrower achieves the Third Tranche Milestone) consecutive equal monthly payments of principal, plus monthly payments of accrued but unpaid interest, in
principal amounts that would fully amortize the applicable Growth Capital Advance over the Repayment Period, commencing on the first (1st) Business Day of the first (1st) month after the Interest-Only Period and continuing thereafter on the first (1st) Business Day of each successive month. The Final Payment and
all unpaid principal and accrued and unpaid interest on each Growth Capital Advance are due and payable in full on the Growth Capital Maturity Date. 

(c) Voluntary Prepayment. Borrower shall have the option to prepay all Growth Capital Advances in full, provided Borrower
(i) shall provide written notice to Bank of its election to prepay the Growth Capital Advances at least thirty (30) days prior to such prepayment and (ii) pays, on the date of such prepayment, (A) all outstanding principal and
accrued but unpaid interest, plus (B) the Prepayment Fee, plus (C) the Final Payment, plus (D) all other sums, including Bank Expenses, if any, that shall have become due and payable. 

(d) Mandatory Prepayment Upon an Acceleration. If the Growth Capital Advances are accelerated following the occurrence of an Event of
Default, Borrower shall immediately pay to Bank an amount equal to the sum of (i) all outstanding principal and accrued but unpaid interest, plus (ii) the Prepayment Fee, plus (iii) the Final Payment, plus (iv) all other sums,
including Bank Expenses, if any, that shall have become due and payable. 
 2.2 Payment of Interest on the Credit Extensions.

 (a) Interest Rate. Subject to Section 2.2(b), the principal amount outstanding for each Growth Capital Advance shall accrue
interest at a floating per annum rate equal to one hundred nineteen basis points (1.19%) above the Prime Rate, which interest shall be payable monthly. 

(b) Default Rate. After an Event of Default, Obligations accrue interest at the Default Rate. The “Default Rate” is,
at Bank’s option, (i) the Maximum Lawful Rate, if the Maximum Lawful rate is established by applicable law, (ii) the interest rate applicable immediately prior to the occurrence of the Event of Default plus five percent (5.00%), if no


  
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Maximum Lawful Rate law has been established by applicable law; (iii) eighteen percent (18.00%) per annum; or (iv) such lesser rate of interest as Bank in its sole discretion may choose
to charge; but in no event more than the Maximum Lawful Rate. Bank will not compute the interest in a manner that would cause Bank to contract for, charge or receive interest that would exceed the Maximum Lawful Rate or the Maximum Lawful Amount. As
used herein, “Maximum Lawful Rate” is the maximum rate of interest, and the term “Maximum Lawful Amount” means the maximum amount of interest that is permissible under applicable state of federal laws for the type
of loan evidenced by the Loan Documents. If the Maximum Lawful Rate is increased by statute of other governmental action after the Effective Date, then the new Maximum Lawful Rate will be applicable to the payments from the date of the effective
date of the rate change, unless otherwise prohibited by law. 
 (i) Spreading of Interest. Due to irregular periodic balances of
principal, the variable nature of the interest rate, or prepayment, the total interest that will accrue under this Agreement cannot be determined in advance. Bank does not intend to contract for, charge or receive more than the Maximum Lawful Rate
or Maximum Lawful Amount permitted by applicable state or federal law, and to prevent such an occurrence Bank and Borrower agree that all amounts of interest, whenever contracted for, charged or received by Bank, with respect to the Obligations,
will be spread, prorated or allocated over the full period of time the Obligations are unpaid, including the period of any renewal or extension thereof. If the maturity of the Obligations is accelerated for any reason whether as a result of an Event
of Default or otherwise prior to the full stated term, the total amount of interest contracted for, charged or received to the time of such demand shall be spread, prorated or allocated along with any interest thereafter accruing over the full
period of time that the Obligations thereafter remain unpaid for the purpose of determining if such interest exceeds the Maximum Lawful Amount. 

(ii) Excess Interest. At maturity (whether by acceleration or otherwise) or on earlier final payment of the Obligations, Bank shall
compute the total amount of interest that has been contracted for, charged or received by Bank or payable by Borrower hereunder and compare such amount to the Maximum Lawful Amount that could have been contracted for, charged or received by Bank. If
such computation reflects that the total amount of interest that has been contracted for, charged, received by Bank, or payable by Borrower exceeds the Maximum Lawful Amount, then Bank shall apply such excess to the reduction of the principal
balance, and any such excess remaining thereafter shall be refunded to Borrower. This provision concerning the crediting or refund of excess interest shall control and take precedence over all other agreements between Borrower and Bank so that under
no circumstances shall the total interest contracted for, charged or received by Bank exceed the Maximum Lawful Amount. 
 (c) Adjustment
to Interest Rate. Changes to the interest rate of any Credit Extension based on changes to the Prime Rate shall be effective on the effective date of any change to the Prime Rate and to the extent of any such change. 

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

  
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 2.3 Fees. Borrower shall pay to Bank the following: 

(a) Good Faith Deposit. Borrower has paid to Bank a good faith deposit of Ten Thousand Dollars ($10,000) to initiate Bank’s due
diligence review process, which deposit shall be applied towards Bank Expenses on the Effective Date; and 
 (b) Expenses. All Bank
Expenses (including reasonable attorneys’ fees and expenses, plus expenses for documentation and negotiation of this Agreement) incurred through and after the Effective Date, when due (or, if no stated due date, upon demand by Bank). 

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

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

(b) Bank has the exclusive right to determine the order and manner in which all payments with respect to the Obligations may be applied.
Borrower shall have no right to specify the order or the accounts to which Bank shall allocate or apply any payments required to be made by Borrower to Bank or otherwise received by Bank under this Agreement when any such allocation or application
is not specified elsewhere in this Agreement. 
 (c) Bank may debit any of Borrower’s deposit accounts, including the Designated
Deposit Account, for principal and interest payments or any other amounts Borrower owes Bank when due. These debits shall not constitute a set-off. 

2.5 Withholding. Payments received by Bank from Borrower under this Agreement will be made free and clear of and without
deduction for any and all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority (including any interest, additions to tax or penalties applicable
thereto). Specifically, however, if at any time any Governmental Authority, applicable law, regulation or international agreement requires Borrower to make any withholding or deduction 

  
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from any such payment or other sum payable hereunder to Bank, Borrower hereby covenants and agrees that the amount due from Borrower with respect to such payment or other sum payable hereunder
will be increased to the extent necessary to ensure that, after the making of such required withholding or deduction, Bank receives a net sum equal to the sum which it would have received had no withholding or deduction been required, and Borrower
shall pay the full amount withheld or deducted to the relevant Governmental Authority. Borrower will, upon request, furnish Bank with proof reasonably satisfactory to Bank indicating that Borrower has made such withholding payment; provided,
however, that Borrower need not make any withholding payment if the amount or validity of such withholding payment is contested in good faith by appropriate and timely proceedings and as to which payment in full is bonded or reserved against by
Borrower. The agreements and obligations of Borrower contained in this Section 2.5 shall survive the termination of this Agreement. 
  

	3.	CONDITIONS OF LOANS 

 3.1 Conditions Precedent to Initial Credit Extension.
Bank’s obligation to make the initial Credit Extension is subject to the condition precedent that Bank shall have received, in form and substance satisfactory to Bank, such documents, and completion of such other matters, as Bank may reasonably
deem necessary or appropriate, including, without limitation: 
 (a) duly executed original signatures to this Agreement; 

(b) a duly executed original signature to the Warrant; 

(c) the Operating Documents and long-form good standing certificates of Borrower and its Subsidiaries certified by the Secretary of State (or
equivalent agency) of Borrower’s and such Subsidiaries’ jurisdiction of organization or formation and each jurisdiction in which Borrower and each Subsidiary is qualified to conduct business, each as of a date no earlier than thirty
(30) days prior to the Effective Date; 
 (d) duly executed original signatures to the completed Borrowing Resolutions for Borrower;

 (e) certified copies, dated as of a recent date, of financing statement searches, as Bank may request, accompanied by written evidence
(including any UCC termination statements) that the Liens indicated in any such financing statements constitute Permitted Liens; 
 (f) the
Perfection Certificate executed by Borrower; 
 (g) a copy of Borrower’s Registration Rights Agreement and/or Investors’ Rights
Agreement and any amendments thereto; and 
 (h) payment of the fees and Bank Expenses then due as specified in Section 2.3 hereof.


  
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 3.2 Conditions Precedent to all Credit Extensions. Bank’s obligations to make
each Credit Extension, including the initial Credit Extension, are subject to the following conditions precedent: 
 (a) timely receipt of
an executed Payment/Advance Form; 
 (b) the representations and warranties in this Agreement shall be true, accurate, and complete in all
material respects on the date of the Payment/Advance Form and on the Funding Date of each Credit Extension; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified
or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date, and no Event of
Default shall have occurred and be continuing or result from the Credit Extension. Each Credit Extension is Borrower’s representation and warranty on that date that the representations and warranties in this Agreement remain true, accurate, and
complete in all material respects; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that
those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date; and 

(c) Bank determines to its satisfaction that there has not been any material impairment in the general affairs, management, results of
operation, financial condition or the prospect of repayment of the Obligations; and there has not been any material adverse deviation by Borrower from the most recent business plan of Borrower presented to and accepted by Bank. 

3.3 Covenant to Deliver. Borrower agrees to deliver to Bank each item required to be delivered to Bank under this Agreement as a
condition precedent to any Credit Extension. Borrower expressly agrees that a Credit Extension made prior to the receipt by Bank of any such item shall not constitute a waiver by Bank of Borrower’s obligation to deliver such item, and any such
Credit Extension in the absence of a required item shall be made in Bank’s sole discretion. 
 3.4 Procedures for
Borrowing. Subject to the prior satisfaction of all other applicable conditions to the making of a Credit Extension set forth in this Agreement, to obtain a Credit Extension, Borrower shall notify Bank (which notice shall be irrevocable) by
electronic mail, facsimile, or telephone by 12:00 p.m. Pacific time on the Funding Date of the Credit Extension. Together with any such electronic or facsimile notification, Borrower shall deliver to Bank by electronic mail or facsimile a completed
Payment/Advance Form executed by a Responsible Officer or his or her designee. Bank may rely on any telephone notice given by a person who Bank believes is a Responsible Officer or designee. Bank shall credit Extensions to the Designated Deposit
Account. Bank may make Credit Extensions under this Agreement based on instructions from a Responsible Officer or his or her designee or without instructions if the Credit Extensions are necessary to meet Obligations that have become due. 

 

	4.	CREATION OF SECURITY INTEREST 

 4.1 Grant of Security Interest. Borrower
hereby grants Bank, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Bank, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all
proceeds and products thereof. 

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

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

4.2 Priority of Security Interest. Borrower represents, warrants, and covenants that the security interest granted herein is and
shall at all times continue to be a first priority perfected security interest in the Collateral (subject only to Permitted Liens that are permitted pursuant to the terms of this Agreement to have superior priority to Bank’s Lien under this
Agreement). If Borrower shall acquire a commercial tort claim, Borrower shall promptly notify Bank in a writing signed by Borrower of the general details thereof and grant to Bank in such writing a security interest therein and in the proceeds
thereof, all upon the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to Bank. 
 4.3
Authorization to File Financing Statements. Borrower hereby authorizes Bank to file financing statements, without notice to Borrower, with all appropriate jurisdictions to perfect or protect Bank’s interest or rights hereunder, including
a notice that any disposition of the Collateral, by Borrower or any other Person, shall be deemed to violate the rights of Bank under the Code. 
  

	5.	REPRESENTATIONS AND WARRANTIES 

 Borrower represents and warrants as follows: 

5.1 Due Organization, Authorization; Power and Authority. Borrower is duly existing and in good standing as a Registered
Organization in its jurisdiction of formation and is qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of its business or its ownership of property requires that it be qualified except where the


  
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failure to do so could not reasonably be expected to have a material adverse effect on Borrower’s business. In connection with this Agreement, Borrower has delivered to Bank a completed
certificate signed by Borrower, entitled “Perfection Certificate”. Borrower represents and warrants to Bank that (a) Borrower’s exact legal name is that indicated on the Perfection Certificate and on the signature page hereof;
(b) Borrower is an organization of the type, and is organized in the jurisdiction, set forth in the Perfection Certificate; (c) the Perfection Certificate accurately sets forth Borrower’s organizational identification number or
accurately states that Borrower has none; (d) the Perfection Certificate accurately sets forth Borrower’s place of business, or, if more than one, its chief executive office as well as Borrower’s mailing address (if different than its
chief executive office); (e) Borrower (and each of its predecessors) has not, in the past five (5) years, changed its jurisdiction of formation, organizational structure or type, or any organizational number assigned by its jurisdiction; and
(f) all other information set forth on the Perfection Certificate pertaining to Borrower and each of its Subsidiaries is accurate and complete (it being understood and agreed that Borrower may from time to time update certain information in the
Perfection Certificate after the Effective Date to the extent permitted by one or more specific provisions in this Agreement). If Borrower is not now a Registered Organization but later becomes one, Borrower shall promptly notify Bank of such
occurrence and provide Bank with Borrower’s organizational identification number. 
 The execution, delivery and performance by
Borrower of the Loan Documents to which it is a party have been duly authorized, and do not (i) conflict with any of Borrower’s organizational documents, (ii) contravene, conflict with, constitute a default under or violate any
material Requirement of Law, (iii) contravene, conflict with or violate any applicable order, writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or any its Subsidiaries or any of their
property or assets may be bound or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals that have already been obtained
and are in full force and effect) or (v) conflict with, contravene, constitute a default or breach under, or result in or permit the termination or acceleration of, any material agreement by which Borrower is bound. Borrower is not in default
under any agreement to which it is a party or by which it is bound in which the default could reasonably be expected to have a material adverse effect on Borrower’s business. 

5.2 Collateral. Borrower has good title to, rights in, and the power to transfer each item of the Collateral upon which it
purports to grant a Lien hereunder, free and clear of any and all Liens except Permitted Liens. Borrower has no Collateral Accounts at or with any bank or financial institution other than Bank or Bank’s Affiliates except for the Collateral
Accounts described in the Perfection Certificate delivered to Bank in connection herewith and which Borrower has taken such actions as are necessary to give Bank a perfected security interest therein, pursuant to the terms of Section 6.6(b). The
Accounts are bona fide, existing obligations of the Account Debtors. 
 The Collateral is not in the possession of any third party bailee
(such as a warehouse) except as otherwise provided in the Perfection Certificate. None of the components of the Collateral shall be maintained at locations other than as provided in the Perfection Certificate or as permitted pursuant to
Section 7.2. 

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

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

5.3 Litigation. There are no actions or proceedings pending or, to the knowledge of any Responsible Officer, threatened in
writing by or against Borrower or any of its Subsidiaries involving more than Fifty Thousand Dollars ($50,000) individually or in the aggregate. 

5.4 No Material Deviation in Financial Statements. All consolidated financial statements for Borrower and any of its
Subsidiaries delivered to Bank fairly present in all material respects Borrower’s consolidated financial condition and Borrower’s consolidated results of operations. There has not been any material deterioration in Borrower’s
consolidated financial condition since the date of the most recent financial statements submitted to Bank. 
 5.5 Solvency.
The fair salable value of Borrower’s consolidated assets (including goodwill minus disposition costs) exceeds the fair value of Borrower’s liabilities; Borrower is not left with unreasonably small capital after the transactions in this
Agreement; and Borrower is able to pay its debts (including trade debts) as they mature. 
 5.6 Regulatory Compliance.
Borrower is not an “investment company” or a company “controlled” by an “investment company” under the Investment Company Act of 1940, as amended. Borrower is not engaged as one of its important activities in extending
credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors). Borrower (a) has complied in all material respects with all Requirements of Law, and (b) has not violated any Requirements of Law the
violation of which could reasonably be expected to have a material adverse effect on its business. None of Borrower’s or any of its Subsidiaries’ properties or assets has been used by Borrower or any Subsidiary or, to the best of
Borrower’s knowledge, by previous Persons, in disposing, producing, storing, treating, or transporting any hazardous substance other than legally. Borrower and each of its Subsidiaries have obtained all consents, approvals and authorizations
of, made all declarations or filings with, and given all notices to, all Governmental Authorities that are necessary to continue their respective businesses as currently conducted. 

  
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 5.7 Subsidiaries; Investments. Borrower does not own any stock, partnership, or
other ownership interest or other equity securities except for Permitted Investments. 
 5.8 Tax Returns and Payments; Pension
Contributions. Borrower has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower except (a) to the extent such
taxes are being contested in good faith by appropriate proceedings promptly instituted and diligently conducted, so long as such reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made
therefor, or (b) if such taxes, assessments, deposits and contributions do not, individually or in the aggregate, exceed Ten Thousand Dollars ($10,000). 

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

5.9 Use of Proceeds. Borrower shall use the proceeds of the Credit Extensions solely as working capital to fund its general
business requirements and not for personal, family, household or agricultural purposes. 
 5.10 Full Disclosure. No written
representation, warranty or other statement of Borrower in any certificate or written statement given to Bank, as of the date such representation, warranty, or other statement was made, taken together with all such written certificates and written
statements given to Bank, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the certificates or statements not misleading (it being recognized by Bank that the
projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected
or forecasted results). 
 5.11 Definition of “Knowledge.” For purposes of the Loan Documents, whenever a
representation or warranty is made to Borrower’s knowledge or awareness, to the “best of” Borrower’s knowledge, or with a similar qualification, knowledge or awareness means the actual knowledge, after reasonable investigation,
of any Responsible Officer. 

  
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	6.	AFFIRMATIVE COVENANTS 

 Borrower shall do all of the following: 

6.1 Government Compliance. 

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

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

6.2 Financial Statements, Reports, Certificates. Provide Bank with the following: 

(a) Monthly Financial Statements. As soon as available, but no later than thirty (30) days after the last day of each month, a
company prepared consolidated balance sheet and income statement covering Borrower’s consolidated operations for such month certified by a Responsible Officer and in a form acceptable to Bank (the “Monthly Financial
Statements”); 
 (b) Monthly Compliance Certificate. Within thirty (30) days after the last day of each month and
together with the Monthly Financial Statements, a duly completed Compliance Certificate signed by a Responsible Officer, certifying that as of the end of such month, Borrower was in full compliance with all of the terms and conditions of this
Agreement, and setting forth such other information as Bank may reasonably request; 
 (c) Annual Operating Budget and Financial
Projections. Within thirty (30) days after the last day of each fiscal year of Borrower, (i) annual operating budgets (including income statements, balance sheets and cash flow statements, by month) for the upcoming fiscal year of
Borrower, and (ii) annual financial projections for the following fiscal year (on a quarterly basis) as approved by Borrower’s board of directors, together with any related business forecasts used in the preparation of such annual
financial projections; 
 (d) Annual Audited Financial Statements. As soon as available, but no later than one hundred eighty
(180) days after the last day of Borrower’s fiscal year, audited consolidated financial statements prepared under GAAP, consistently applied, together with an unqualified opinion on the financial statements from an independent certified
public accounting firm acceptable to Bank in its reasonable discretion; 
 (e) Other Statements. Within ten (10) days of
delivery, copies of all statements, reports and notices made available to Borrower’s security holders or to any holders of Subordinated Debt; 

(f) SEC Filings. In the event that Borrower becomes subject to the reporting requirements under the Exchange Act within ten
(10) days of filing, copies of all periodic and other reports, proxy statements and other materials filed by Borrower with the SEC, any Governmental Authority succeeding to any or all of the functions of the SEC or with any


  
 11 








 
national securities exchange, or distributed to its shareholders, as the case may be. Documents required to be delivered pursuant to the terms hereof (to the extent any such documents are
included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which Borrower posts such documents, or provides a link thereto, on Borrower’s
website on the Internet at Borrower’s website address; provided, however, Borrower shall promptly notify Bank in writing (which may be by electronic mail) of the posting of any such documents; 

(g) Legal Action Notice. A prompt report of any legal actions pending or threatened in writing against Borrower or any of its
Subsidiaries that could result in damages or costs to Borrower or any of its Subsidiaries of, individually or in the aggregate, Fifty Thousand Dollars ($50,000) or more; and 

(h) Other Financial Information. Other financial information reasonably requested by Bank. 

6.3 Inventory; Returns. Keep all Inventory in good and marketable condition, free from material defects. Returns and allowances
between Borrower and its Account Debtors shall follow Borrower’s customary practices as they exist at the Effective Date. Borrower must promptly notify Bank of all returns, recoveries, disputes and claims that involve more than One Hundred
Thousand Dollars ($100,000). 
 6.4 Taxes; Pensions. Timely file, and require each of its Subsidiaries to timely file, all
required tax returns and reports and timely pay, and require each of its Subsidiaries to timely pay, all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower and each of its Subsidiaries, except for
deferred payment of any taxes contested pursuant to the terms of Section 5.8 hereof, and shall deliver to Bank, on demand, appropriate certificates attesting to such payments, and pay all amounts necessary to fund all present pension, profit
sharing and deferred compensation plans in accordance with their terms. 
 6.5 Insurance. 

(a) Keep its business and the Collateral insured for risks and in amounts standard for companies in Borrower’s industry and location and
as Bank may reasonably request. Insurance policies shall be in a form, with financially sound and reputable insurance companies that are not Affiliates of Borrower, and in amounts that are reasonably satisfactory to Bank. All property policies shall
have a lender’s loss payable endorsement showing Bank as lender loss payee. All liability policies shall show, or have endorsements showing, Bank as an additional insured. Bank shall be named as lender loss payee and/or additional insured with
respect to any such insurance providing coverage in respect of any Collateral. 
 (b) Proceeds payable under any property policy are, at
Bank’s option, payable to Bank on account of the Obligations. 
 (c) At Bank’s request, Borrower shall deliver certified copies of
insurance policies and evidence of all premium payments. Each provider of any such insurance required under this Section 6.5 shall agree, by endorsement upon the policy or policies issued by it or by independent instruments furnished to Bank,
that it will give Bank thirty (30) days prior written 

  
 12 








 
notice before any such policy or policies shall be materially altered or canceled. If Borrower fails to obtain insurance as required under this Section 6.5 or to pay any amount or furnish
any required proof of payment to third persons and Bank, Bank may make all or part of such payment or obtain such insurance policies required in this Section 6.5, and take any action under the policies Bank deems prudent. 

6.6 Operating Accounts. 

(a) Maintain its primary operating and other deposit accounts and securities accounts with Bank and Bank’s Affiliates, which accounts
shall represent at least eighty-five percent (85%) of the dollar value of Borrower’s accounts at all financial institutions. 
 (b)
Provide Bank five (5) Business Days prior written notice before establishing any Collateral Account at or with any bank or financial institution other than Bank or Bank’s Affiliates. For each Collateral Account that Borrower at any time
maintains, Borrower shall cause the applicable bank or financial institution (other than Bank) at or with which any Collateral Account is maintained to execute and deliver a Control Agreement or other appropriate instrument with respect to such
Collateral Account to perfect Bank’s Lien in such Collateral Account in accordance with the terms hereunder, which control agreements may not be terminated without the prior written consent of Bank. The provisions of the previous sentence shall
not apply to deposit accounts exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of Borrower’s employees and identified to Bank by Borrower as such. 

6.7 Reserved. 

6.8 Protection of Intellectual Property Rights. 

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

(b) Provide written notice to Bank within ten (10) days of entering or becoming bound by any Restricted License (other than over-the-counter software that is commercially available to the public). Borrower shall take such steps as Bank requests to obtain the consent of, or waiver by, any person
whose consent or waiver is necessary for (i) any Restricted License to be deemed “Collateral” and for Bank to have a security interest in it that might otherwise be restricted or prohibited by law or by the terms of any such
Restricted License, whether now existing or entered into in the future, and (ii) Bank to have the ability in the event of a liquidation of any Collateral to dispose of such Collateral in accordance with Bank’s rights and remedies under
this Agreement and the other Loan Documents. 
 6.9 Litigation Cooperation. From the date hereof and continuing through the
termination of this Agreement, make available to Bank, without expense to Bank, Borrower and its officers, employees and agents and Borrower’s books and records, to the extent that Bank may deem them reasonably necessary to prosecute or defend
any third-party suit or proceeding instituted by or against Bank with respect to any Collateral or relating to Borrower. 

  
 13 








 6.10 Access to Collateral; Books and Records. Allow Bank, or its agents, at
reasonable times, on three (3) Business Days’ notice (provided no notice is required if an Event of Default has occurred and is continuing), to inspect the Collateral and audit and copy Borrower’s Books. Such inspections or audits
shall be conducted no more often than once every twelve (12) months unless an Event of Default has occurred and is continuing in which case such inspections and audits shall occur as often as Bank shall determine is necessary. The foregoing
inspections and audits shall be at Borrower’s expense, and the charge therefor shall be Eight Hundred Fifty Dollars ($850) per person per day, plus reasonable
out-of-pocket expenses. In the event Borrower and Bank schedule an audit more than ten (10) days in advance, and Borrower cancels or seeks to reschedule the audit
with less than ten (10) days written notice to Bank, then (without limiting any of Bank’s rights or remedies), Borrower shall pay Bank a fee of One Thousand Dollars ($1,000) plus any out-of-pocket expenses incurred by Bank to compensate Bank for the anticipated costs and expenses of the cancellation or rescheduling. 

6.11 Further Assurances. Execute any further instruments and take further action as Bank reasonably requests to perfect or
continue Bank’s Lien in the Collateral or to effect the purposes of this Agreement. 
  

	7.	NEGATIVE COVENANTS 

 Borrower shall not do any of the following without Bank’s prior
written consent: 
 7.1 Dispositions. Convey, sell, lease, transfer, assign, or otherwise dispose of (collectively,
“Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, except for Transfers (a) of Inventory in the ordinary course of business; (b) of
worn-out or obsolete Equipment that is, in the reasonable judgment of Borrower, no longer economically practicable to maintain or useful in the ordinary course of business of Borrower; (c) consisting of
Permitted Liens and Permitted Investments; (d) consisting of the sale or issuance of any stock of Borrower permitted under Section 7.2 of this Agreement; (e) consisting of Borrower’s use or transfer of money or Cash Equivalents
in the ordinary course of its business for the payment of ordinary course business expenses in a manner that is not prohibited by the terms of this Agreement or the other Loan Documents; and (f) of
non-exclusive licenses for the use of the property of Borrower or its Subsidiaries in the ordinary course of business. 

7.2 Changes in Business, Management, Ownership or Business Locations. 

(a) Engage in or permit any of its Subsidiaries to engage in any business other than the businesses currently engaged in by Borrower and such
Subsidiary, as applicable, or reasonably related thereto; (b) liquidate or dissolve; or (c) (i) fail to provide notice to Bank of any Key Person departing from or ceasing to be employed by Borrower within ten (10) days after his or
her departure from Borrower; or (ii) enter into any transaction or series of related transactions in which the stockholders of Borrower who were not stockholders immediately prior to the first such transaction own more than forty-nine percent
(49%) of the voting stock of Borrower immediately after giving effect to such transaction or related series of such 

  
 14 








 
transactions (other than by the sale of Borrower’s equity securities in a public offering or to venture capital or private equity investors so long as Borrower identifies to Bank the venture
capital or private equity investors at least seven (7) Business Days prior to the closing of the transaction and provides to Bank a description of the material terms of the transaction). 

Borrower shall not, without at least thirty (30) days prior written notice to Bank: (1) add any new offices or business locations, including
warehouses (unless such new offices or business locations contain less than Twenty Thousand Dollars ($20,000) in Borrower’s assets or property) or deliver any portion of the Collateral valued, individually or in the aggregate, in excess of
Twenty Thousand Dollars ($20,000) to a bailee at a location other than to a bailee and at a location already disclosed in the Perfection Certificate, (2) change its jurisdiction of organization, (3) change its organizational structure or
type, (4) change its legal name, or (5) change any organizational number (if any) assigned by its jurisdiction of organization. If Borrower intends to deliver any portion of the Collateral valued, individually or in the aggregate, in
excess of Twenty Thousand Dollars ($20,000) to a bailee, and Bank and such bailee are not already parties to a bailee agreement governing both the Collateral and the location to which Borrower intends to deliver the Collateral, then Borrower will
first receive the written consent of Bank, and such bailee shall execute and deliver a bailee agreement in form and substance satisfactory to Bank. 

7.3 Mergers or Acquisitions. Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any other
Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of another Person (including, without limitation, by the formation of any Subsidiary). A Subsidiary may merge or consolidate
into another Subsidiary or into Borrower. 
 7.4 Indebtedness. Create, incur, assume, or be liable for any Indebtedness, or
permit any Subsidiary to do so, other than Permitted Indebtedness. 
 7.5 Encumbrance. Create, incur, allow, or suffer any
Lien on any of its property, or assign or convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, except for Permitted Liens; permit any Collateral not to be subject to the first priority
security interest granted herein; or enter into any agreement, document, instrument or other arrangement (except with or in favor of Bank) with any Person that directly or indirectly prohibits, or has the effect of prohibiting, Borrower from
assigning, mortgaging, pledging, granting a security interest in or upon, or encumbering any of Borrower’s Intellectual Property, except as is otherwise permitted in Section 7.1 hereof and the definition of “Permitted Lien”
herein. 
 7.6 Maintenance of Collateral Accounts. Maintain any Collateral Account except pursuant to the terms of Section
6.6(b) hereof. 
 7.7 Distributions; Investments. Pay any dividends or make any distribution or payment or redeem, retire or
purchase any capital stock; or directly or indirectly make any Investment (including, without limitation, by the formation of any Subsidiary) other than Permitted Investments, or permit any of its Subsidiaries to do so. 

  
 15 








 7.8 Transactions with Affiliates. Directly or indirectly enter into or permit to
exist any material transaction with any Affiliate of Borrower, except for transactions that are in the ordinary course of Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an
arm’s length transaction with a non-affiliated Person. 
 7.9 Subordinated Debt.
(a) Make or permit any payment on any Subordinated Debt, except under the terms of the subordination, intercreditor, or other similar agreement to which such Subordinated Debt is subject, or (b) amend any provision in any document relating
to the Subordinated Debt that would increase the amount thereof, provide for earlier or greater principal, interest, or other payments thereon, or adversely affect the subordination thereof to Obligations owed to Bank. 

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

	8.	EVENTS OF DEFAULT 

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

8.2 Covenant Default. 

(a) Borrower fails or neglects to perform any obligation in Sections 6.2, 6.4, 6.5, 6.6, 6.8(b), or 6.10 or violates any covenant in
Section 7; or 
 (b) Borrower fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or
agreement contained in this Agreement or any Loan Documents, and as to any default (other than those specified in this Section 8) under such other 

  
 16 








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

8.3 Investor Abandonment; Priority of Security Interest. If Bank determines in its good faith business judgment that it is the
clear intention of Borrower’s investors to not continue to fund Borrower in the amounts and timeframe to the extent necessary to enable Borrower to satisfy the Obligations as they become due and payable, or there is a material impairment in the
perfection or priority of the Bank’s security interest in the Collateral; 
 8.4 Attachment; Levy; Restraint on Business.

 (a) (i) The service of process seeking to attach, by trustee or similar process, any funds of Borrower or of any entity under the control
of Borrower (including a Subsidiary) in excess of Fifty Thousand Dollars ($50,000), or (ii) a notice of lien or levy is filed against any of Borrower’s assets by any Governmental Authority, and the same under subclauses (i) and (ii)
hereof are not, within ten (10) days after the occurrence thereof, discharged or stayed (whether through the posting of a bond or otherwise); provided, however, no Credit Extensions shall be made during any ten (10) day cure period; or

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

8.5 Insolvency. (a) Borrower is unable to pay its debts (including trade debts) as they become due or otherwise becomes
insolvent; (b) Borrower begins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against Borrower and not dismissed or stayed within thirty (30) days (but no Credit Extensions shall be made while any of the conditions
described in clause (a) exist and/or until any Insolvency Proceeding is dismissed); 
 8.6 Other Agreements. There is,
under any agreement to which Borrower or any Guarantor is a party with a third party or parties, (a) any default resulting in a right by such third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an
amount individually or in the aggregate in excess of Fifty Thousand Dollars ($50,000); or (b) any breach or default by Borrower or Guarantor, the result of which could have a material adverse effect on Borrower’s or any Guarantor’s
business; 
 8.7 Judgments; Penalties. One or more fines, penalties or final judgments, orders, or decrees for the payment of
money in an amount, individually or in the aggregate, of at least Fifty Thousand Dollars ($50,000) (not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against
Borrower by any 

  
 17 








 
Governmental Authority, and the same are not, within ten (10) days after the entry, assessment or issuance thereof, discharged, satisfied, or paid, or after execution thereof stayed or
bonded pending appeal, or such judgments are not discharged prior to the expiration of any such stay (provided that no Credit Extensions will be made prior to the satisfaction, payment, discharge, stay, or bonding of such fine, penalty, judgment,
order, or decree); 
 8.8 Misrepresentations. Borrower or any Person acting for Borrower makes any representation, warranty or
other statement now or later in this Agreement, any Loan Document or in any writing delivered to Bank or to induce Bank to enter this Agreement or any Loan Document, and such representation, warranty, or other statement is incorrect in any material
respect when made; 
 8.9 Subordinated Debt. A default or breach occurs under any agreement between Borrower and any creditor
of Borrower that signed a subordination, intercreditor, or other similar agreement with Bank, or any creditor that has signed such an agreement with Bank breaches any terms of such agreement; or 

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

	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, without notice or demand, do any or all of the following: 
 (a)
declare all Obligations immediately due and payable (but if an Event of Default described in Section 8.5 occurs all Obligations are immediately due and payable without any action by Bank); 

(b) stop advancing money or extending credit for Borrower’s benefit under this Agreement or under any other agreement between Borrower
and Bank; 
 (c) for any Letters of Credit, demand that Borrower (i) deposit cash with Bank in an amount equal to at least 105% (110%
for Letters of Credit denominated in a Foreign Currency) of the Dollar Equivalent of the aggregate face amount of all Letters of Credit remaining undrawn (plus all interest, fees, and costs due or to become due in connection therewith (as estimated
by Bank in its good faith business judgment)), to secure all of the Obligations relating to such Letters of Credit, as collateral security for the repayment of any 

  
 18 








 
future drawings under such Letters of Credit, and Borrower shall forthwith deposit and pay such amounts, and (ii) pay in advance all letter of credit fees scheduled to be paid or payable
over the remaining term of any Letters of Credit; 
 (d) terminate any FX Contracts; 

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

(f) make any payments and do any acts it considers necessary or reasonable to protect the Collateral and/or its security interest in the
Collateral. Borrower shall assemble the Collateral if Bank requests and make it available as Bank designates. Bank may enter premises where the Collateral is located, take and maintain possession of any part of the Collateral, and pay, purchase,
contest, or compromise any Lien that appears to be prior or superior to its security interest and pay all expenses incurred. Borrower grants Bank a license to enter and occupy any of its premises, without charge, to exercise any of Bank’s
rights or remedies; 
 (g) apply to the Obligations (i) any balances and deposits of Borrower it holds, or (ii) any amount held by
Bank owing to or for the credit or the account of Borrower; 
 (h) ship, reclaim, recover, store, finish, maintain, repair, prepare for
sale, advertise for sale and sell the Collateral. Bank is hereby granted a non-exclusive, royalty-free license or other right to use, without charge, Borrower’s labels, Patents, Copyrights, mask works,
rights of use of any name, trade secrets, trade names, Trademarks, and advertising matter, or any similar property as it pertains to the Collateral, in completing production of, advertising for sale, and selling any Collateral and, in connection
with Bank’s exercise of its rights under this Section, Borrower’s rights under all licenses and all franchise agreements inure to Bank’s benefit; 

(i) 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; 
 (j) demand and
receive possession of Borrower’s Books; and 
 (k) exercise all rights and remedies available to Bank under the Loan Documents or at
law or equity, including all remedies provided under the Code (including disposal of the Collateral pursuant to the terms thereof). 

9.2 Power of Attorney. Borrower hereby irrevocably appoints Bank as its lawful attorney-in-fact, exercisable upon the occurrence and during the continuance of an Event of Default, to: (a) endorse Borrower’s name on any checks or other forms of payment or security;
(b) sign Borrower’s name on any invoice or bill of lading for any Account or drafts against Account Debtors; (c) settle and adjust disputes and claims about the Accounts directly with Account Debtors, for amounts and on terms Bank
determines reasonable; (d) make, settle, and adjust all claims under Borrower’s insurance policies; (e) pay, contest or settle any Lien, charge, 

  
 19 








 
encumbrance, security interest, and adverse claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; and (f) transfer
the Collateral into the name of Bank or a third party as the Code permits. Borrower hereby appoints Bank as its lawful attorney-in-fact to sign Borrower’s name on
any documents necessary to perfect or continue the perfection of Bank’s security interest in the Collateral, regardless of whether an Event of Default has occurred, until all Obligations have been satisfied in full and Bank is under no further
obligation to make Credit Extensions hereunder. Bank’s foregoing appointment as Borrower’s attorney in fact, and all of Bank’s rights and powers, coupled with an interest, are irrevocable until all Obligations have been fully repaid
and performed and Bank’s obligation to provide Credit Extensions terminates. 
 9.3 Protective Payments. If Borrower
fails to obtain the insurance called for by Section 6.5 or fails to pay any premium thereon or fails to pay any other amount which Borrower is obligated to pay under this Agreement or any other Loan Document or which may be required to preserve
the Collateral, Bank may obtain such insurance or make such payment, and all amounts so paid by Bank are Bank Expenses and immediately due and payable, bearing interest at the then highest rate applicable to the Obligations, and secured by the
Collateral. Bank will make reasonable efforts to provide Borrower with notice of Bank obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Bank are deemed an agreement to make similar payments in
the future or Bank’s waiver of any Event of Default. 
 9.4 Application of Payments and Proceeds Upon Default. If an
Event of Default has occurred and is continuing, Bank shall have the right to apply in any order any funds in its possession, whether from Borrower account balances, payments, proceeds realized as the result of any collection of Accounts or other
disposition of the Collateral, or otherwise, to the Obligations. Bank shall pay any surplus to Borrower by credit to the Designated Deposit Account or to other Persons legally entitled thereto; Borrower shall remain liable to Bank for any
deficiency. If Bank, directly or indirectly, enters into a deferred payment or other credit transaction with any purchaser at any sale of Collateral, Bank shall have the option, exercisable at any time, of either reducing the Obligations by the
principal amount of the purchase price or deferring the reduction of the Obligations until the actual receipt by Bank of cash therefor. 

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

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

  
 20 








 
not preclude Bank from exercising any other remedy under this Agreement or other remedy available at law or in equity, and Bank’s waiver of any Event of Default is not a continuing waiver.
Bank’s delay in exercising any remedy is not a waiver, election, or acquiescence. 
 9.7 Demand Waiver. Borrower waives
demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by
Bank on which Borrower is liable. 
  

	10.	NOTICES 

 All notices, consents, requests, approvals, demands, or other communication by
any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or delivered: (a) upon the earlier of actual receipt and three (3) Business Days after deposit in the U.S.
mail, first class, registered or certified mail return receipt requested, with proper postage prepaid; (b) upon transmission, when sent by electronic mail or facsimile transmission; (c) one (1) Business Day after deposit with a reputable
overnight courier with all charges prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed to the party to be notified and sent to the address, facsimile number, or email address indicated below. Bank or
Borrower may change its mailing or electronic mail address or facsimile number by giving the other party written notice thereof in accordance with the terms of this Section 10. 

 

			
	If to Borrower:	  	Molecular Templates, Inc.
		  	111 W. Cooperative Way, Suite 201_
		  	Georgetown, TX 78626_
		  	Attn: Jason Kim, President
		  	Fax: (512) 233-2709
		  	Email: jason.kim@moleculartemplates.com
		
	If to Bank:	  	Silicon Valley Bank
		  	4370 La Jolla Village Drive, Suite 1050
		  	San Diego, CA 92122
		  	Attn: Anthony Flores
		  	Fax: (858) 622-1424
		  	Email: aflores@svb.com

  

	11.	CHOICE OF LAW, VENUE, JURY TRIAL WAIVER AND JUDICIAL REFERENCE 

 Except as otherwise
expressly provided in any of the Loan Documents, Texas law governs the Loan Documents without regard to principles of conflicts of law. Borrower and Bank each submit to the exclusive jurisdiction of the State and Federal courts in Texas; provided,
however, that nothing in this Agreement shall be deemed to operate to preclude Bank from bringing suit or taking other legal action in any other jurisdiction to realize on the Collateral or any other security for the Obligations, or to enforce a
judgment or other court order in favor of Bank. Borrower expressly submits and consents in advance to such jurisdiction in any action or 

  
 21 








 
suit commenced in any such court, and Borrower hereby waives any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consents
to the granting of such legal or equitable relief as is deemed appropriate by such court. Borrower hereby waives personal service of the summons, complaints, and other process issued in such action or suit and agrees that service of such summons,
complaints, and other process may be made by registered or certified mail addressed to Borrower at the address set forth in Section 10 of this Agreement and that service so made shall be deemed completed upon the earlier to occur of
Borrower’s actual receipt thereof or three (3) days after deposit in the U.S. mails, proper postage prepaid. 
 BORROWER AND
BANK EACH WAIVE THEIR RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER
IS A MATERIAL INDUCEMENT FOR BOTH PARTIES TO ENTER INTO THIS AGREEMENT. EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL. 
 This
Section 11 shall survive the termination of this Agreement. 
  

	12.	GENERAL PROVISIONS 

 12.1 Termination Prior to Maturity Date; Survival. All
covenants, representations and warranties made in this Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations have been satisfied. So long as Borrower has satisfied the Obligations (other than
inchoate indemnity obligations, any other obligations which, by their terms, are to survive the termination of this Agreement, and any Obligations under Bank Services Agreements that are cash collateralized in accordance with Section 4.1 of
this Agreement), this Agreement may be terminated prior to the Growth Capital Maturity Date by Borrower in accordance with Section 2.1.1(c). Those obligations that are expressly specified in this Agreement as surviving this Agreement’s
termination shall continue to survive notwithstanding this Agreement’s termination. 
 12.2 Successors and Assigns. This
Agreement binds and is for the benefit of the successors and permitted assigns of each party. Borrower may not assign this Agreement or any rights or obligations under it without Bank’s prior written consent (which may be granted or withheld in
Bank’s discretion). Bank has the right, without the consent of or notice to Borrower, to sell, transfer, assign, negotiate, or grant participation in all or any part of, or any interest in, Bank’s obligations, rights, and benefits under
this Agreement and the other Loan Documents (other than the Warrant, as to which assignment, transfer and other such actions are governed by the terms thereof). 

12.3 Indemnification. Borrower agrees to indemnify, defend and hold Bank and its directors, officers, employees, agents,
attorneys, or any other Person affiliated with or representing Bank (each, an “Indemnified Person”) harmless against: (i) all obligations, demands, claims, and liabilities (collectively, “Claims”) claimed or
asserted by any other party in connection with the transactions contemplated by the Loan Documents; and (ii) all losses or 

  
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expenses (including Bank Expenses) in any way suffered, incurred, or paid by such Indemnified Person as a result of, following from, consequential to, or arising from transactions between Bank
and Borrower (including reasonable attorneys’ fees and expenses), except for Claims and/or losses directly caused by such Indemnified Person’s gross negligence or willful misconduct. 

This Section 12.3 shall survive until all statutes of limitation with respect to the Claims, losses, and expenses for which indemnity is
given shall have run. 
 12.4 Time of Essence. Time is of the essence for the performance of all Obligations in this
Agreement. 
 12.5 Severability of Provisions. Each provision of this Agreement is severable from every other provision in
determining the enforceability of any provision. 
 12.6 Correction of Loan Documents. Bank may correct patent errors and fill
in any blanks in this Agreement and the other Loan Documents consistent with the agreement of the parties. 
 12.7 Amendments in
Writing; Waiver; Integration. No purported amendment or modification of any Loan Document, or waiver, discharge or termination of any obligation under any Loan Document, shall be enforceable or admissible unless, and only to the extent,
expressly set forth in a writing signed by the party against which enforcement or admission is sought. Without limiting the generality of the foregoing, no oral promise or statement, nor any action, inaction, delay, failure to require performance or
course of conduct shall operate as, or evidence, an amendment, supplement or waiver or have any other effect on any Loan Document. Any waiver granted shall be limited to the specific circumstance expressly described in it, and shall not apply to any
subsequent or other circumstance, whether similar or dissimilar, or give rise to, or evidence, any obligation or commitment to grant any further waiver. The Loan Documents represent the entire agreement about this subject matter and supersede prior
negotiations or agreements. All prior agreements, understandings, representations, warranties, and negotiations between the parties about the subject matter of the Loan Documents merge into the Loan Documents. 

12.8 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, is an original, and all taken together, constitute one Agreement. 
 12.9
Confidentiality. In handling any confidential information, Bank shall exercise the same degree of care that it exercises for its own proprietary information, but disclosure of information may be made: (a) to Bank’s Subsidiaries or
Affiliates (such Subsidiaries and Affiliates, together with Bank, collectively, “Bank Entities”); (b) to prospective transferees or purchasers of any interest in the Credit Extensions (provided, however, Bank shall use its best
efforts to obtain any prospective transferee’s or purchaser’s agreement to the terms of this provision); (c) as required by law, regulation, subpoena, or other order; (d) to Bank’s regulators or as otherwise required in
connection with Bank’s examination or audit; (e) as Bank considers appropriate in exercising remedies under the Loan Documents; and (f) to third-party service 

  
 23 








 
providers of Bank so long as such service providers have executed a confidentiality agreement with Bank with terms no less restrictive than those contained herein. Confidential information does
not include information that is either: (i) in the public domain or in Bank’s possession when disclosed to Bank, or becomes part of the public domain (other than as a result of its disclosure by Bank in violation of this Agreement) after
disclosure to Bank; or (ii) disclosed to Bank by a third party if Bank does not know that the third party, is prohibited from disclosing the information. 

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

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

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

12.12 Captions. The headings used in this Agreement are for convenience only and shall not affect the interpretation of this
Agreement. 
 12.13 Construction of Agreement. The parties mutually acknowledge that they and their attorneys have
participated in the preparation and negotiation of this Agreement. In cases of uncertainty this Agreement shall be construed without regard to which of the parties caused the uncertainty to exist. 

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

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

12.16 No Novation. Nothing contained herein shall in any way impair the Prior Loan Agreement and other Loan Documents now held
for the Obligations, nor affect or impair any 

  
 24 








 
rights, powers, or remedies under the Prior Loan Agreement or any Loan Document, it being the intent of the parties hereto that this Agreement shall not constitute a novation of the Prior Loan
Agreement or an accord and satisfaction of the Obligations. Borrower hereby ratifies and reaffirms the validity and enforceability of all of the liens and security interests heretofore granted pursuant to the Loan Documents, as collateral security
for the Obligations, and acknowledges that all of such liens and security interests, and all Collateral heretofore pledged as security for the Obligations, continues to be and remains Collateral for the Obligations from and after the date hereof.

  

	13.	DEFINITIONS 

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

“Account” is any “account” as defined in the Code with such additions to such term as may hereafter be made, and
includes, without limitation, all accounts receivable and other sums owing to Borrower. 
 “Account Debtor” is any
“account debtor” as defined in the Code with such additions to such term as may hereafter be made. 
 “Affiliate”
is, with respect to any Person, each other Person that owns or controls directly or indirectly the Person, any Person that controls or is controlled by or is under common control with the Person, and each of that Person’s senior executive
officers, directors, partners and, for any Person that is a limited liability company, that Person’s managers and members. 

“Agreement” is defined in the preamble hereof. 

“Bank” is defined in the preamble hereof. “Bank Entities” is defined in Section 12.9. 

“Bank Expenses” are all audit fees and expenses, costs, and expenses (including reasonable attorneys’ fees and expenses)
for preparing, amending, negotiating, administering, defending and enforcing the Loan Documents (including, without limitation, those incurred in connection with appeals or Insolvency Proceedings and those identified as Bank Expenses in
Section 9.3 hereof) or otherwise incurred with respect to Borrower. 
 “Bank Services” are any products, credit
services, and/or financial accommodations previously, now, or hereafter provided to Borrower or any of its Subsidiaries by Bank or any Bank Affiliate, including, without limitation, any letters of credit, cash management services (including, without
limitation, merchant services, direct deposit of payroll, business credit cards, and check cashing services), interest rate swap arrangements, and foreign exchange services as any such products or services may be identified in Bank’s various
agreements related thereto (each, a “Bank Services Agreement”). 
 “Borrower” is defined in the preamble
hereof. 

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

“Borrowing Resolutions” are, with respect to any Person, those resolutions substantially in the form attached hereto as
Exhibit C. 
 “Business Day” is any day that is not a Saturday, Sunday or a day on which Bank is closed. 

“Cash Equivalents” means (a) marketable direct obligations issued or unconditionally guaranteed by the United States or
any agency or any State thereof having maturities of not more than one (1) year from the date of acquisition; (b) commercial paper maturing no more than one (1) year after its creation and having the highest rating from either
Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc.; and (c) Bank’s certificates of deposit issued maturing no more than one (1) year after issue. 

“Claims” is defined in Section 12.3. 

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

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

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

“Commodity Account” is any “commodity account” as defined in the Code with such additions to such term as may
hereafter be made. 
 “Compliance Certificate” is that certain certificate in the form attached hereto as
Exhibit D. 
 “Contingent Obligation” is, for any Person, any direct or indirect liability,
contingent or not, of that Person for (a) any indebtedness, lease, dividend, letter of credit or other obligation of another such as an obligation, in each case, directly or indirectly guaranteed, endorsed,
co-made, discounted or sold with recourse by that Person, or for which that Person is directly or indirectly 

  
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liable; (b) any obligations for undrawn letters of credit for the account of that Person; and (c) all obligations from any interest rate, currency or commodity swap agreement, interest
rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; but “Contingent Obligation” does not include endorsements in
the ordinary course of business. The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for
it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement. 

“Control Agreement” is any control agreement entered into among the depository institution at which Borrower maintains a
Deposit Account or the securities intermediary or commodity intermediary at which Borrower maintains a Securities Account or a Commodity Account, Borrower, and Bank pursuant to which Bank obtains control (within the meaning of the Code) over such
Deposit Account, Securities Account, or Commodity Account. 
 “Copyrights” are any and all copyright rights, copyright
applications, copyright registrations and like protections in each work of authorship and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret. 

“Credit Extension” is any Growth Capital Advance or any other extension of credit by Bank for Borrower’s benefit under
this Agreement. 
 “Default Rate” is defined in Section 2.2(b). 

“Deposit Account” is any “deposit account” as defined in the Code with such additions to such term as may hereafter
be made. 
 “Designated Deposit Account” is the multicurrency account denominated in Dollars, account number
*******            , maintained by Borrower with Bank. 

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

“Dollar Equivalent” is, at any time, (a) with respect to any amount denominated in Dollars, such amount, and
(b) with respect to any amount denominated in a Foreign Currency, the equivalent amount therefor in Dollars as determined by Bank at such time on the basis of the then-prevailing rate of exchange in San Francisco, California, for sales of the
Foreign Currency for transfer to the country issuing such Foreign Currency. 
 “Effective Date” is defined in the preamble
hereof. 
 “Equipment” is all “equipment” as defined in the Code with such additions to such term as may
hereafter be made, and includes without limitation all machinery, fixtures, goods, vehicles (including motor vehicles and trailers), and any interest in any of the foregoing. 

  
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 “ERISA” is the Employee Retirement Income Security Act of 1974, and its
regulations. “Event of Default” is defined in Section 8. 
 “Exchange Act” is the Securities Exchange Act of
1934, as amended. 
 “Final Payment” is a payment (in addition to and not a substitution for the regular monthly payments
of principal plus accrued interest) due in accordance with Section 2.1.1 above, equal to the Growth Capital Loan Commitment multiplied by the Final Payment Percentage. 

“Final Payment Percentage” is five and three-quarters percent (5.75%). 

“First Tranche” is defined in Section 2.1.1(a)(i). 

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

“Funding Date” is any date on which a Credit Extension is made to or for the account of Borrower, which shall be a Business
Day. 
 “FX Contract” is any foreign exchange contract by and between Borrower and Bank under which Borrower commits to
purchase from or sell to Bank a specific amount of Foreign Currency on a specified date. 
 “GAAP” is generally accepted
accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such
other statements by such other Person as may be approved by a significant segment of the accounting profession, that are applicable to the circumstances as of the date of determination. 

“General Intangibles” is all “general intangibles” as defined in the Code in effect on the date hereof with such
additions to such term as may hereafter be made, and includes without limitation, all Intellectual Property, claims, income and other tax refunds, security and other deposits, payment intangibles, contract rights, options to purchase or sell real or
personal property, rights in all litigation presently or hereafter pending (whether in contract, tort or otherwise), insurance policies (including without limitation key man, property damage, and business interruption insurance), payments of
insurance and rights to payment of any kind. 
 “Governmental Approval” is any consent, authorization, approval, order,
license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority. 

“Governmental Authority” is any nation or government, any state or other political subdivision thereof, any agency,
authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any
self-regulatory organization. 
 “Growth Capital Advance” is defined in Section 2.1.1(a). 

  
 28 








 “Growth Capital Commitment Termination Date (Second Tranche)” is June 30,
2015. 
 “Growth Capital Commitment Termination Date (Third Tranche)” is December 31, 2015. 

“Growth Capital Loan Commitment” is Six Million Dollars ($6,000,000). 

“Growth Capital Maturity Date” is the first (1st) day of the month which is forty-eight (48) months from the Effective
Date. 
 “Guarantor” is any Person providing a Guaranty in favor of Bank. 

“Guaranty” is any guarantee of all or any part of the Obligations, as the same may from time to time be amended, restated,
modified or otherwise supplemented. 
 “Indebtedness” is (a) indebtedness for borrowed money or the deferred price of
property or services, such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations, and (d) Contingent
Obligations. 
 “Indemnified Person” is defined in Section 12.3. 

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

“Intellectual Property” means, with respect to any Person, all of such Person’s right, title, and interest in and to the
following: 
 (a) its Copyrights, Trademarks and Patents; 

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

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

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

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

“Interest-Only Period” means the period commencing on the Effective Date and continuing for twelve (12) consecutive
months; provided, however, that if Borrower achieves the Third Tranche Milestone, the Interest-Only Period shall automatically be extended for an additional six (6) months. 

  
 29 








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

“Investment” is any beneficial ownership interest in any Person (including stock, partnership interest or other securities),
and any loan, advance or capital contribution to any Person. 
 “Key Person” is each of Borrower’s (a) Chief
Executive Officer, who is Eric Poma as of the Effective Date, (b) Chief Financial Officer, who is Jason Kim as of the Effective Date, and (c) Chief Medical Officer, who is David Valacer as of the Effective Date. 

“Letter of Credit” is a standby or commercial letter of credit issued by Bank upon request of Borrower based upon an
application, guarantee, indemnity, or similar agreement. 
 “Lien” is a claim, mortgage, deed of trust, levy, charge,
pledge, security interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property. 

“Loan Documents” are, collectively, this Agreement and any schedules, exhibits, certificates, notices, and any other
documents related to this Agreement, the Warrant, any Bank Services Agreement, any subordination agreement, any note, or notes or guaranties executed by Borrower or any Guarantor, and any other present or future agreement by Borrower and/or any
Guarantor with or for the benefit of Bank in connection with this Agreement or Bank Services, all as amended, restated, or otherwise modified. 

“Material Adverse Change” is (a) a material impairment in the perfection or priority of Bank’s Lien in the
Collateral or in the value of such Collateral; (b) a material adverse change in the business, operations, or condition (financial or otherwise) of Borrower; or (c) a material impairment of the prospect of repayment of any portion of the
Obligations. 
 “Obligations” are Borrower’s obligation to pay when due any debts, principal, interest, fees, Bank
Expenses, and other amounts Borrower owes Bank now or later, whether under this Agreement, the other Loan Documents (other than the Warrant), or otherwise, including, without limitation, any interest accruing after Insolvency Proceedings begin and
debts, liabilities, or obligations of Borrower assigned to Bank, and the performance of Borrower’s duties under the Loan Documents (other than the Warrant). 

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

  
 30 








 
company, its limited liability company agreement (or similar agreement), and (c) if such Person is a partnership, its partnership agreement (or similar agreement), each of the foregoing with
all current amendments or modifications thereto. 
 “Patents” means all patents, patent applications and like protections
including without limitation improvements, divisions, continuations, renewals, reissues, extensions and continuations-in-part of the same. 

“Payment/Advance Form” is that certain form attached hereto as Exhibit B. “Perfection Certificate” is defined in
Section 5.1. 
 “Permitted Indebtedness” is: 

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

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

(c) Subordinated Debt; 
 (d)
unsecured Indebtedness to trade creditors incurred in the ordinary course of business; 
 (e) Indebtedness incurred as a result of endorsing
negotiable instruments received in the ordinary course of business; 
 (f) Indebtedness in an aggregate principal amount not to exceed Fifty
Thousand Dollars ($50,000) secured by Permitted Liens; and 
 (g) extensions, refinancings, modifications, amendments and restatements of
any items of Permitted Indebtedness (a) through (f) above, provided that the principal amount thereof is not increased or the terms thereof are not modified to impose more burdensome terms upon Borrower or its Subsidiary, as the case may be.

 “Permitted Investments” are: 

(a) Investments shown on the Perfection Certificate and existing on the Effective Date; 

(b) Investments consisting of Cash Equivalents; 

(c) Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary
course of Borrower; 
 (d) Investments consisting of deposit accounts in which Bank has a perfected security interest; 

  
 31 








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

(f) Investments consisting of the creation of a Subsidiary for the purpose of consummating a merger transaction permitted by Section 7.3
of this Agreement, which is otherwise a Permitted Investment; 
 (g) Investments of Subsidiaries in or to other Subsidiaries or Borrower and
Investments by Borrower in Subsidiaries not to exceed Fifty Thousand Dollars ($50,000) in the aggregate in any fiscal year; 
 (h)
Investments consisting of (i) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business, and (ii) loans to employees, officers or directors relating to the purchase of equity
securities of Borrower or its Subsidiaries pursuant to employee stock purchase plans or agreements approved by Borrower’s Board of Directors; 

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

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

“Permitted Liens” are: 

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

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

(c) purchase money Liens (i) on Equipment acquired or held by Borrower incurred for financing the acquisition of the Equipment securing
no more than Fifty Thousand Dollars ($50,000) in the aggregate amount outstanding, or (ii) existing on Equipment when acquired, if the Lien is confined to the property and improvements and the proceeds of the Equipment; 

(d) Liens of carriers, warehousemen, suppliers, or other Persons that are possessory in nature arising in the ordinary course of business so
long as such Liens attach only to Inventory, securing liabilities in the aggregate amount not to exceed Fifty Thousand Dollars ($50,000) and which are not delinquent or remain payable without penalty or which are being contested in good faith and by
appropriate proceedings which proceedings have the effect of preventing the forfeiture or sale of the property subject thereto; 

  
 32 








 (e) Liens to secure payment of workers’ compensation, employment insurance, old-age pensions, social security and other like obligations incurred in the ordinary course of business (other than Liens imposed by ERISA); 

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

(g) 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), and leases, subleases, non-exclusive licenses or sublicenses of personal property (other than Intellectual 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), if the leases, subleases, licenses and sublicenses do not prohibit granting Bank a security interest therein; 

(h) non-exclusive license of Intellectual Property granted to third parties in the ordinary course of
business; 
 (i) Liens arising from attachments or judgments, orders, or decrees in circumstances not constituting an Event of Default under
Sections 8.4 and 8.7; and 
 (j) Liens in favor of other financial institutions arising in connection with Borrower’s deposit and/or
securities accounts held at such institutions, provided that Bank has a perfected security interest in the amounts held in such deposit and/or securities accounts. 

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

“Prepayment Fee” shall be an amount equal to one-half of one percent (0.50%) of the
Growth Capital Loan Commitment. Notwithstanding the foregoing, Bank agrees to waive the Prepayment Fee if Bank closes on the refinance and re-documentation of the Growth Capital Advances (in Bank’s sole
and exclusive discretion) prior to the Growth Capital Maturity Date. 
 “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 Bank, the “Prime Rate” shall mean the rate of interest per annum announced by Bank as its prime rate in effect at its principal
office in the State of California (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). 

“Prior Loan Agreement” is defined in the recitals hereto. 

  
 33 








 “Registered Organization” is any “registered organization” as defined
in the Code with such additions to such term as may hereafter be made. 
 “Repayment Period” is a period of time commencing
on the first (1st) Business Day of the first (1st) month following the Interest-Only Period and ending on the Growth Capital Maturity Date. 

“Requirement of Law” is as to any Person, the organizational or governing documents of such Person, and any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is
subject. 
 “Responsible Officer” is any of the Chief Executive Officer, President, Chief Financial Officer or Controller
of Borrower. 
 “Restricted License” is any material license or other agreement with respect to which Borrower is the
licensee (a) that prohibits or otherwise restricts Borrower from granting a security interest in Borrower’s interest in such license or agreement or any other property, or (b) for which a default under or termination of could
interfere with the Bank’s right to sell any Collateral. 
 “SEC” shall mean the Securities and Exchange Commission,
any successor thereto, and any analogous Governmental Authority. 
 “Second Tranche” is defined in Section 2.1.1(a)(ii).

 “Securities Account” is any “securities account” as defined in the Code with such additions to such term as
may hereafter be made. 
 “Subordinated Debt” is indebtedness incurred by Borrower subordinated to all of Borrower’s
now or hereafter indebtedness to Bank (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Bank entered into between Bank and the other creditor), on terms acceptable to Bank. 

“Subsidiary” is, as to any Person, a corporation, partnership, limited liability company or other entity of which shares of
stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers
of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person. Unless the context otherwise requires,
each reference to a Subsidiary herein shall be a reference to a Subsidiary of Borrower or Guarantor. 
 “Third Tranche” is
defined in Section 2.1.1(a)(iii). 
 “Third Tranche Milestone” means that Borrower has notified Bank in writing that
Borrower has achieved a positive Phase 1 data readout for the MT-3724 NHL trial by no later than December 31, 2015, and Bank has either (i) confirmed to its satisfaction that Borrower has met
such milestone or (ii) not contested such notice within ten (10) Business Days of such notice. Bank shall retain sole discretion to contest such notice. 

  
 34 








 “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. 

“Transfer” is defined in Section 7.1. 

“Warrant” is, collectively, that certain Warrant to Purchase Stock dated as of April 7, 2014 executed by Borrower in
favor of Bank and that certain Warrant to Purchase Stock dated as of the Effective Date executed by Borrower in favor of Bank. 

13.2 Notice of Final Agreement. THE WRITTEN LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. 

[Signature page follows.] 

  
 35 








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

					
	BORROWER
	
	MOLECULAR TEMPLATES, INC.
		
	By:	 	 /s/ Jason Kim

		 	Name:	 	Jason Kim
		 	Title:	 	President/CFO
	
	BANK:
	
	SILICON VALLEY BANK
		
	By:	 	 /s/ Anthony Flores

		 	Name:	 	Anthony Flores
		 	Title:	 	Vice President

 [Signature Page to Amended and Restated Loan and Security Agreement] 







 EXHIBIT A 

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

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

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

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







 EXHIBIT B 

Loan Payment/Advance Request Form 

DEADLINE FOR SAME DAY PROCESSING IS
NOON Pacific Time. 
  

			
	Fax To: (858) 622-1424	 	Date:                     

 LOAN PAYMENT: 

MOLECULAR TEMPLATES, INC. 

 


			
	From Account #	 	 
		 	(Deposit Account #)


			
	Principal $	 	 


			
	Authorized Signature:	 	 


			
	Print Name/Title:	 	 

 


			
	To Account #	 	 
		 	(Loan Account #)


			
	and/or Interest $	 	 


			
	        Phone Number:	 	 

 
 

  
 Loan Advance: 

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

 


			
	From Account #	 	 
		 	(Loan Account #)


			
	Amount of Advance $	 	 

 


			
	To Account #	 	 
		 	(Deposit Account #)
		 	

 
 

  
 All Borrower’s representations and
warranties in the Amended and Restated Loan and Security Agreement are true, correct and complete in all material respects on the date of the request for an advance; provided, however, that such materiality qualifier shall not be applicable to any
representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in
all material respects as of such date: 

 


			
	Authorized Signature:	 	 


			
	Print Name/Title:	 	 

 


					
	Phone Number	 	 	 	:
		 		 	

 
 

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

Deadline for same day processing is non, P.S.T. 

 


			
	Beneficiary Name:	 	 


			
	Beneficiary Bank:	 	 


			
	City and State:	 	


			
		
	Beneficiary Bank Transit (ABA) #:	 	 


			
		
	Intermediary Bank:	 	 

 


			
	Amount of Wire: $	 	 


			
	Account Number:	 	 

 Beneficiary Bank Code (Swift,
Sort, Chip, etc.): 
 (For International Wire Only) 

 

			
	Transit (ABA) #:	 	 

 
 


			
	For further Credit to:	 	 

  

			
	Special Instructions:	 	 

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

 


			
	Authorized Signature:	 	 


			
	Print Name/Title:	 	 


			
	Telephone #:	 	 

 


			
	2nd Signature (if required):	 	 


			
	Print name/Title:	 	 


			
	Telephone #:	 	 

 
 








 EXHIBIT C 

BORROWING RESOLUTIONS 

[see attached] 







 EXHIBIT D 

COMPLIANCE CERTIFICATE 
  

					
	TO:	 	SILICON VALLEY BANK	  	Date:                     
	FROM:    	 	MOLECULAR TEMPLATES, INC.	  	

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

 

					
	 Reporting Covenant
	  	 Required
	  	 Complies

			
	Monthly financial statements with Compliance Certificate	  	Monthly within 30 days	  	Yes No
	Annual financial statement (CPA Audited) + CC	  	FYE within 180 days	  	Yes No
	Annual Board-Approved Financial Projections	  	FYE within 30 days	  	Yes No

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

 
  

 


			
	MOLECULAR TEMPLATES, INC.


			
		
	By:	 	  

	Name:	 	  

	Title:	 	  


 


			
	BANK USE ONLY
		
	Received by:	 	  

		 	AUTHORIZED SIGNER


			
	Date:	 	  



 

			
	Verified:	 	  

		 	AUTHORIZED SIGNER

  

			
	Date:	 	  



			
	
	Compliance Status:        Yes    No

 
 








 [Signature Page to Amended and Restated Loan and Security Agreement]