Exhibit 10.1 





 


LOAN
AND SECURITY AGREEMENT


 


THIS LOAN AND SECURITY
AGREEMENT (this “Agreement”) dated as of August 18, 2015 (the “Effective Date”) between
SILICON VALLEY BANK, a California corporation with a loan production office located at 275 Grove Street, Suite 2-200, Newton,
Massachusetts 02466 (“Bank”), and OCATA THERAPEUTICS, 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:


 


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 meaning 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      Term Loan.


 


(a)          Availability. Subject to the terms and conditions of this Agreement, Bank shall make one (1) advance (the “Term
A Loan Advance”) available to Borrower in an amount of Six Million Dollars ($6,000,000.00) on the Effective Date. Subject
to the terms and conditions of this Agreement, during the Term B Draw Period, Bank shall make one (1) advance (the “Term
B Loan Advance”) available to Borrower in an amount of up to Four Million Dollars ($4,000,000.00). The Term A Loan Advance
and Term B Loan Advance are hereinafter referred to singly as the “Term Loan Advance” and collectively as the
“Term Loan Advances.” The aggregate amount of all Term Loan Advances shall not exceed Ten Million Dollars ($10,000,000.00).
After repayment, no Term Loan Advance may be reborrowed.


 


(b)          Interest Payments. Commencing on the first (1st) Payment Date of the month following the month in which
the Funding Date of the applicable Term Loan Advance occurs and continuing on each Payment Date thereafter, Borrower shall make
monthly payments of interest on the outstanding principal amount of such Term Loan Advance, in arrears, at the rate set forth in
Section 2.2(a).


 


(c)          Repayment. Commencing on the applicable Amortization Date, and continuing on each Payment Date thereafter, Borrower
shall repay the Term Loan Advances in (i) equal monthly payments of principal based on the applicable Repayment Schedule, plus
(ii) monthly payments of accrued interest at the rate set forth in Section 2.2(a). All outstanding principal and accrued and unpaid
interest with respect to the Term Loan Advances, and all other outstanding Obligations with respect to the Term Loan Advances,
are due and payable in full on the Term Loan Maturity Date.


 


(d)          Mandatory Prepayment Upon an Acceleration. If the Term Loan Advances are accelerated by Bank pursuant to Section
9.1 following the occurrence and during the continuance of an Event of Default, Borrower shall immediately pay to Bank an amount
equal to the sum of: (i) all outstanding principal plus accrued and unpaid interest, (ii) the Prepayment Premium, (iii) the Final
Payment, plus (iv) all other sums, if any, that shall have become due and payable hereunder, including interest at the Default
Rate with respect to any past due amounts.


 


(e)          Permitted Prepayment of Term Loan Advances. Borrower shall have the option to prepay all, but not less than all,
of the Term Loan Advances advanced by Bank under this Agreement, provided Borrower (i) provides written notice to Bank of its election
to prepay the Term Loan Advances at least ten (10) days prior to such prepayment, and (ii) pays, on the date of such prepayment
(A) all outstanding principal plus accrued and unpaid interest, (B) the Prepayment Premium, (C) the Final Payment, plus (D) all
other sums, if any, that shall have become due and payable hereunder, including interest at the Default Rate with respect to any
past due amounts.


 






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2.2         Payment of Interest on the Credit Extensions. 


 


(a)          Interest Rate. Subject to Section 2.2(b), the principal amount outstanding under the Term Loan Advances shall accrue
interest at a fixed per annum rate equal to three and one-quarter of one percent (3.25%) above the Prime Rate, which interest shall
be determined by Bank as of the Effective Date and shall be payable monthly in accordance with Section 2.2(c) below.


 


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


 


(c)          Payment; Interest Computation. Interest is payable monthly in arrears on the Payment Date and shall be computed on
the basis of a 360-day year for the actual number of days elapsed. In computing interest, (i) all payments received after
1:00 p.m. Eastern time on any day shall be deemed received at the opening of business on the next Business Day, and (ii) the
date of the making of any Credit Extension shall be included and the date of payment shall be excluded; provided, however, that
if any Credit Extension is repaid on the same day on which it is made, such day shall be included in computing interest on such
Credit Extension.


 


2.3         Fees. Borrower shall pay to Bank:


 


(a)          Prepayment Premium. The Prepayment Premium, when due hereunder;


 


(b)          Final Payment. The Final Payment, when due hereunder; and


 


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


 


(d)          Good Faith Deposit. Borrower has paid to Bank a deposit of Twenty Thousand Dollars ($20,000) (the “Good
Faith Deposit”) to initiate Bank’s due diligence review process. Any portion of the Good Faith Deposit not utilized
to pay Bank Expenses shall be refunded to Borrower.


 


(e)          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 1:00 p.m. Eastern time on the date when due. Payments of principal and/or interest received after
1:00 p.m. Eastern time are considered received at the opening of business on the next Business Day. When a payment is due on a
day that is not a Business Day, the payment shall be due the next Business Day, and additional fees or interest, as applicable,
shall continue to accrue until paid.


 






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(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.


 


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 have reasonably requested, including, without limitation:


 


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


 


(b)          duly executed original signatures to the Control Agreement(s);


 


(c)          the Operating Documents and long-form good standing certificates of Borrower certified by the Secretary of State (or equivalent
agency) of Borrower’s jurisdiction of organization or formation and each jurisdiction in which Borrower 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 either constitute
Permitted Liens or have been or, in connection with the initial Credit Extension, will be terminated or released;


 


(f)           the Perfection Certificate of Borrower, together with the duly executed original signature thereto;


 


(g)          evidence satisfactory to Bank that the insurance policies and endorsements required by [Section 6.5] hereof are in full
force and effect; and


 


(h)          payment of the fees and Bank Expenses then due as specified in Section 2.3 hereof.


 


3.2         Conditions Precedent to all Credit Extensions. Bank’s obligations to make each Credit Extension,
including the initial Credit Extension, is 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 are true, accurate, and complete in all material respects as of such date; 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


 






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(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 when due, or 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 the making of any Credit Extension in the absence of a required item shall be 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 1:00 p.m. Eastern time two (2) Business Days before the proposed
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 whom Bank reasonably believes is a Responsible Officer or designee. Bank shall
credit the 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
which have become due.


 


3.5         Post-Closing Conditions. Within thirty (30) days after the Effective Date, Bank shall have received, in
form and substance satisfactory to Bank (i) a landlord’s consent in favor of Bank for 33 Locke Drive, Marlborough, Massachusetts
01752 by the landlord thereof, together with the duly executed original signatures thereto, and (ii) appropriate evidence showing
lender loss payable and/or additional insured clauses or endorsements in favor of Bank with respect to all insurance policies required
by Section 6.5 hereof.


 


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.


 


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 are permitted pursuant to the terms of this Agreement
to 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 repaid in full in cash. Upon payment in full in cash of the Obligations (other than inchoate indemnity obligations) and at
such time as Bank’s obligation to make Credit Extensions has terminated, Bank shall, at the sole cost and expense of Borrower,
release its Liens in the Collateral and all rights therein shall revert to Borrower. In the event (x) all Obligations (other than
inchoate indemnity obligations), except for Bank Services, are satisfied in full, and (y) this Agreement is terminated, 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, in each case,
all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its business judgment), to
secure all of the Obligations relating to such Letters of Credit.


 






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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 either Borrower or any other Person, shall be deemed to violate the
rights of Bank under the Code. Such financing statements may indicate the Collateral as “all assets of the Debtor”
or words of similar effect, or as being of an equal or lesser scope, or with greater detail, all in Bank’s discretion.


 


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 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”
(the “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 or violate any applicable order, writ, judgment, injunction, decree,
determination or award of any Governmental Authority by which Borrower or any of its Subsidiaries or any of their property or assets
may be bound or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval
from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full force and
effect (or are being obtained pursuant to Section 6.1(b)), 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.


 






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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 (other than (i) mobile equipment such as laptop computers in the possession of Borrower’s
employees or agents and (ii) Inventory, components or active pharmaceutical ingredients in the possession of clinical trial administrators
and participants, contract manufacturers or Borrower’s customers or potential customers in the ordinary course of business)
shall be maintained at locations other than as provided in the Perfection Certificate or as permitted pursuant to Section 7.2.


 


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


 


Borrower is the sole
owner of the Intellectual Property which it owns or purports to own except for (a) non-exclusive licenses granted to its customers
in the ordinary course of business, (b) over-the-counter software that is commercially available to the public, and (c) material
Intellectual Property licensed to Borrower and noted on the Perfection Certificate. Each Patent which it owns or purports to own
and which is material to Borrower’s business is valid and enforceable, and no part of the Intellectual Property which Borrower
owns or purports to own and which is material to Borrower’s business has been judged invalid or unenforceable, in whole or
in part. To 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, individually or in the aggregate,
One Hundred Thousand Dollars ($100,000.00).


 


5.4         Financial Statements; Financial Condition. 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 as of the date thereof. 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 by Borrower.


 


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 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 ($10,000.00).


 


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 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 in connection with the Loan Documents or the transactions contemplated thereby, as of the date
such representation, warranty, or other statement was made, taken together with all such written certificates and written statements
given to 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 in light of the circumstances in which they were made (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.


 


6.            AFFIRMATIVE COVENANTS


 


Borrower shall do all
of the following:


 


6.1          Government Compliance. 


 


(a)          Maintain its and (except as permitted by Section 7.3) all its Subsidiaries’ legal existence and good standing in their
respective jurisdictions of formation and maintain qualification in each jurisdiction in which the failure to so qualify would
reasonably be expected to have a material adverse effect on Borrower’s business or operations. Borrower shall comply, and
have each Subsidiary comply, in all material respects, with all laws, ordinances and regulations to which it is subject.


 


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


 






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


 


(a)          Quarterly Financial Statements. As soon as available, but no later than forty-five (45) days after the last day of
each quarter, a company prepared consolidated and consolidating balance sheet and income statement covering Borrower’s and
each of its Subsidiary’s operations for such month certified by a Responsible Officer and in a form acceptable to Bank (the
“Quarterly Financial Statements”);


 


(b)          Monthly Compliance Certificate. Within thirty (30) days after the last day of each month, a duly completed Compliance
Certificate signed by a Responsible Officer, certifying that as of the end of such month, Borrower was in compliance with all of
the terms and conditions of this Agreement, and such other information regarding Borrower or its business as Bank may reasonably
request;


 


(c)          Annual Board Approved Projections. As soon as available, but no later than forty-five (45) days after the end of
each fiscal year of Borrower, and contemporaneously with any material updates or changes thereto, annual Board approved projections
for the current fiscal year in a form acceptable to Bank;


 


(d)          Annual Audited Financial Statements. As soon as available, but no later than the earlier of (i) one hundred fifty
(150) days after the last day of Borrower’s fiscal year and (ii) within five (5) days of filing with the SEC, audited consolidated
financial statements prepared under GAAP, consistently applied, together with an unqualified opinion on the financial statements
from BDO USA, LLP or another independent certified public accounting firm reasonably acceptable to Bank;


 


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


 


(f)           SEC Filings. Within five (5) days of filing, copies of all periodic and other reports, proxy statements and other
materials filed by Borrower with the SEC, any Governmental Authority succeeding to any or all of the functions of the SEC or with
any national securities exchange, or distributed to its shareholders, as the case may be. Documents required to be delivered pursuant
to the terms hereof (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered
electronically and if so delivered, shall be deemed to have been delivered on the date on which Borrower posts such documents,
or provides a link thereto, on Borrower’s website on the Internet at Borrower’s website address; provided, however,
Borrower shall promptly notify 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,
One Hundred Thousand Dollars ($100,000.00) 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 ($100,000.00).


 


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.


 






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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 satisfactory to Bank. All property policies shall have a
lender’s loss payable endorsement showing Bank as the sole 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)          Ensure that proceeds payable under any property policy are, at Bank’s option, payable to Bank on account of the Obligations.
Notwithstanding the foregoing, (a) so long as no Event of Default has occurred and is continuing, Borrower shall have the option
of applying the proceeds of any casualty policy up to One Hundred Thousand Dollars ($100,000.00) with respect to any loss, but
not exceeding Two Hundred Fifty Thousand Dollars ($250,000.00) in the aggregate for all losses under all casualty policies in any
one year, toward the replacement or repair of destroyed or damaged property; provided that any such replaced or repaired property
(i) shall be of equal or like value as the replaced or repaired Collateral and (ii) shall be deemed Collateral in which
Bank has been granted a first priority security interest, and (b) after the occurrence and during the continuance of an Event of
Default, all proceeds payable under such casualty policy shall, at the option of Bank, be 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 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 all of its and all of its Subsidiaries’ operating, depository and securities accounts with Bank and Bank’s
Affiliates.  


 


(b)          Provide Bank five (5) 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 Agreement 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          Protection of Intellectual Property Rights. 


 


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


 






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6.8          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.


 


6.9          Access to Collateral; Books and Records. Allow Bank, or its agents, at reasonable times, on one (1) Business
Day’s 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.


 


6.10        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. Deliver to Bank, within
five (5) days after the same are sent or received, copies of all correspondence, reports, documents and other filings with any
Governmental Authority regarding compliance with or maintenance of Governmental Approvals or Requirements of Law or that could
reasonably be expected to have a material effect on any of the Governmental Approvals or otherwise on the operations of Borrower
or any of its Subsidiaries.


 


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, obsolete or surplus Equipment that is, in the reasonable judgment of Borrower,
no longer economically practicable to maintain or useful in the ordinary course of business of Borrower; (c) consisting of Permitted
Liens and Permitted Investments; (d) consisting of the sale or issuance of any stock of Borrower permitted under Section 7.2 of
this Agreement; (e) consisting of Borrower’s use or transfer of money or Cash Equivalents in a manner that is not prohibited
by the terms of this Agreement or the other Loan Documents; and (f) of non-exclusive licenses for the use of the property of Borrower
or its Subsidiaries in the ordinary course of business and licenses that could not result in a legal transfer of title of the licensed
property but that may be exclusive in respects other than territory and that may be exclusive as to territory only as to discrete
geographical areas outside of the United States.


 


7.2          Changes in Business, Management, Control, or Business Locations.  (a) Engage in or permit any of its Subsidiaries
to engage in any business other than the businesses currently engaged in by Borrower and such Subsidiary, as applicable, or reasonably
related thereto; (b) liquidate or dissolve; or (c) fail to provide notice to Bank of any Key Person departing from or ceasing to
be employed by Borrower within five (5) days after such Key Person’s departure from Borrower; or (d) permit or suffer any
Change in Control.


 


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 each such new office or business location contains less than Fifty Thousand Dollars ($50,000.00) in Borrower’s assets
or property) or deliver any portion of the Collateral (other than Inventory, components or active pharmaceutical ingredients in
the possession of clinical trial administrators and participants, contract manufacturers or Borrower’s customers or potential
customers in the ordinary course of business) valued, individually or in the aggregate, in excess of One Hundred Thousand Dollars
($100,000.00) to a bailee at a location other than to a bailee and at a location already disclosed in the Perfection Certificate,
(2) change its jurisdiction of organization, (3) change its organizational structure or type, (4) change its legal name, or (5)
change any organizational number (if any) assigned by its jurisdiction of organization. If Borrower intends to deliver any portion
of the Collateral (other than Inventory, components or active pharmaceutical ingredients in the possession of clinical trial administrators
and participants, contract manufacturers or Borrower’s customers or potential customers in the ordinary course of business)
valued, individually or in the aggregate, in excess of One Hundred Thousand Dollars ($100,000.00) 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.


 






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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 which directly or indirectly prohibits or has
the effect of prohibiting Borrower or any Subsidiary from assigning, mortgaging, pledging, granting a security interest in or upon,
or encumbering any of Borrower’s or any Subsidiary’s Intellectual Property, except as is otherwise permitted in Section
7.1 hereof and the definition of “Permitted Liens” herein.


 


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


 


7.7          Distributions; Investments. (a) Pay any dividends or make any distribution or payment or redeem, retire
or purchase any capital stock; provided that Borrower may pay dividends solely in common stock; or (b) directly or indirectly make
any Investment (including, without limitation, by the formation of any Subsidiary) other than Permitted Investments, or permit
any of its Subsidiaries to do so.


 


7.8          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 which would increase the amount thereof, provide for earlier or greater principal,
interest, or other payments thereon, or adversely affect the subordination thereof to Obligations owed to 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.


 






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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 cure period shall not apply to payments due on the Term Loan Maturity Date). During the cure period, the
failure to make or pay any payment specified under clause (b) hereunder is not an Event of Default (but no Credit Extension will
be made during the cure period);


 


8.2           Covenant Default. 


 


(a)         Borrower fails or neglects to perform any obligation in Sections 6.2, 6.4, 6.5, 6.6, 6.7(b), or violates any covenant in
Section 7; or


 


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


 


8.3           Material Adverse Change. A Material Adverse Change occurs;


 


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), 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 is not dismissed or stayed within forty-five (45) 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 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 One Hundred Thousand Dollars ($100,000.00); or (b) any
breach or default by Borrower, the result of which could have a material adverse effect on Borrower’s business;


 






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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 One Hundred Thousand Dollars ($100,000.00) (not covered by
independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against
Borrower by any Governmental Authority, and the same are not, within ten (10) days after the entry, assessment or issuance thereof,
discharged, satisfied, or paid, or after execution thereof, stayed or bonded pending appeal, or such judgments are not discharged
prior to the expiration of any such stay (provided that no Credit Extensions will be made prior to the satisfaction, payment, discharge,
stay, or bonding of such fine, penalty, judgment, order or decree);


 


8.8           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. Any document, instrument, or agreement evidencing any Subordinated Debt shall for any
reason be revoked or invalidated or otherwise cease to be in full force and effect, any Person shall be in breach thereof or contest
in any manner the validity or enforceability thereof or deny that it has any further liability or obligation thereunder, or the
Obligations shall for any reason be subordinated or shall not have the priority contemplated by this Agreement; 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) cause, or could reasonably be expected to cause, a Material Adverse Change,
or (ii) materially 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 materially adversely 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, to the extent not prohibited by applicable law:


 


(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)          demand that Borrower (i) deposit cash with Bank in an amount equal to at least (A) one hundred five percent (105.0%) of
the Dollar Equivalent of the aggregate face amount of all Letters of Credit denominated in Dollars remaining undrawn, and (B) one
hundred ten percent (110.0%) of the Dollar Equivalent of the aggregate face amount of all Letters of Credit denominated in a Foreign
Currency remaining undrawn, (plus, in each case, all interest, fees, and costs due or to become due in connection therewith (as
estimated by 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 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,
and notify any Person owing Borrower money of Bank’s security interest in such funds;


 






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(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 at any location
that is reasonably convenient to Bank and Borrower. Bank may peaceably enter premises where the Collateral is located, take and
maintain possession of any part of the Collateral, and pay, purchase, contest, or compromise any Lien which appears to be prior
or superior to its security interest and pay all expenses incurred. Borrower grants Bank a license to enter and occupy any of its
premises, without charge by Borrower, to exercise any of Bank’s rights or remedies;


 


(g)          apply to the Obligations then due (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, 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 (other than inchoate indemnity 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 (other than
inchoate indemnity 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.


 






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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 applicable law and 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 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.


 






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	If to Borrower:	Ocata Therapeutics,
Inc.

33 Locke Drive


Marlborough, Massachusetts 01752


Attn: Ted Myles

Fax: 508-229-2333


Email: tmyles@ocata.com


Website URL: www.ocata.com



	 	 
	With a copy to:	Goodwin Procter
LLP


53 State Street


Boston, Massachusetts 02109


Attn: Mark D. Smith


Fax: (617) 523-1231


Email: marksmith@goodwinprocter.com



	 	 
	If to Bank:	Silicon Valley Bank

275 Grove Street, Suite 2-200


Newton, Massachusetts 02466

Attn: Clark Hayes

Email: chayes@svb.com



	 	 
	with a copy to:	Riemer & Braunstein
LLP

Three Center Plaza

Boston, Massachusetts 02108

Attn: David A. Ephraim, Esquire

Fax: (617) 880-3456

Email: DEphraim@riemerlaw.com



 





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


 


Except as otherwise
expressly provided in any of the Loan Documents, Massachusetts 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 Boston, Massachusetts; 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 suit commenced
in any such court, and Borrower hereby waives any objection that it may have based upon lack of personal jurisdiction, improper
venue, or forum non conveniens and hereby consents to the granting of such legal or equitable relief as is deemed appropriate by
such court. Borrower hereby waives personal service of the summons, complaints, and other process issued in such action or suit
and agrees that service of such summons, complaints, and other process may be made by registered or certified mail addressed to
Borrower at the address set forth in, or subsequently provided by Borrower in accordance with, Section 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 RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN
DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A MATERIAL
INDUCEMENT FOR 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.


 






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12.            GENERAL PROVISIONS


 


12.1          Termination Prior to Term Loan 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 (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)
have been satisfied. So long as Borrower has satisfied the Obligations (other than inchoate indemnity obligations, and 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 Term
Loan Maturity Date by Borrower, effective three (3) Business Days after written notice of termination is given to Bank. 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.


 


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 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 the Loan Documents
consistent with the agreement of the parties so long as Bank provides Borrower with written notice of such correction and allows
Borrower at least ten (10) days to object to such correction. In the event of such objection, such correction shall not be made
except by an amendment signed by both Bank and Borrower.


 


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.


 






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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 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        Right of Set Off. Borrower hereby grants to Bank, a lien, security interest and right of set off as security
for all Obligations to Bank, whether now existing or hereafter arising upon and against all deposits, credits, collateral and property,
now or hereafter in the possession, custody, safekeeping or control of Bank or any entity under the control of Bank (including
a Bank subsidiary) or in transit to any of them. At any time after the occurrence and during the continuance of an Event of Default,
without demand or notice, Bank may set off the same or any part thereof and apply the same to any Obligations of Borrower then
due regardless of the adequacy of any other collateral securing the Obligations. ANY AND ALL RIGHTS TO REQUIRE BANK TO EXERCISE
ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SETOFF
WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.


 


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.


 






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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.


 


“AMD Requirement”
is defined in the definition of Term B Milestone Event.


 


“Amortization
Date” is (i) with respect to the Term A Loan Advance, August 1, 2016, and (ii) with respect to the Term B Loan Advance,
August 1, 2016, provided, however, that upon the occurrence of the Term B

Extension Event, the Amortization Date for the Term B Loan Advance shall mean February 1, 2017.


 


“ATM Facility”
is defined in the definition of Term B Milestone Event.


 


“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) 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”).


 


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


 


“Board”
means Borrower’s board of directors.


 


“Borrower”
is defined in the preamble hereof.


 


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


 






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


 


“Business
Day” is any day that is not a Saturday, Sunday or a day on which 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.; (c) Bank’s certificates of deposit issued maturing no more than one (1) year after issue; and (d)
money market funds at least ninety-five percent (95%) of the assets of which constitute Cash Equivalents of the kinds described
in clauses (a) through (c) of this definition.


 


“Change in
Control” means (a) at any time, any “person” or “group” (as such terms are used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), shall become, or
obtain rights (whether by means or warrants, options or otherwise) to become, the “beneficial owner” (as defined in
Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of forty-nine percent (49.0%) or more of the ordinary
voting power for the election of directors of Borrower (determined on a fully diluted basis) other than by the sale of Borrower’s
equity securities in a public offering or to venture capital or private equity investors so long as Borrower identifies to 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; (b) during any period of twelve (12) consecutive months, a majority
of the members of the Board of directors or other equivalent governing body of Borrower cease to be composed of individuals (i)
who were members of that Board or equivalent governing body on the first day of such period, (ii) whose election or nomination
to that Board or equivalent governing body was approved by individuals referred to in clause (i) above constituting at the time
of such election or nomination at least a majority of that Board or equivalent governing body or (iii) whose election or nomination
to that Board or other equivalent governing body was approved by individuals referred to in clauses (i) and (ii) above constituting
at the time of such election or nomination at least a majority of that Board or equivalent governing body; or (c) at any time,
Borrower shall cease to own and control, of record and beneficially, directly or indirectly, one hundred percent (100.0%) of each
class of outstanding capital stock of each subsidiary of Borrower free and clear of all Liens (except Liens created by this Agreement).


 


“Claims”
is defined in Section 12.3.


 


“Code”
is the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the Commonwealth of Massachusetts;
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 Commonwealth of Massachusetts, 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.


 






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“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 B.


 


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


 


“Control Agreement”
is any control agreement entered into among the depository institution at which Borrower maintains a Deposit Account or the securities
intermediary or commodity intermediary at which Borrower maintains a Securities Account or a Commodity Account, Borrower, and 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 Term Loan Advance or any other extension of credit by Bank for Borrower’s benefit.


 


“Currency”
is coined money and such other banknotes or other paper money as are authorized by law and circulate as a medium of exchange.


 


“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 in substitution for the regular monthly payments of principal plus accrued interest) equal
to the original principal amount of the Term Loan Advances extended by Bank to Borrower hereunder multiplied by the Final Payment
Percentage, due on the earliest to occur of (a) the Term Loan Maturity Date, (b) the acceleration by Bank of the Term Loan Advances
pursuant to Section 9.1, (c) the prepayment of the Term Loan Advances by Borrower pursuant to Section 2.1.1(d) or 2.1.1(e), or
(d) the termination of the Agreement.


 


“Final Payment
Percentage” is, for each Term Loan Advance, eight percent (8.0%).


 


“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,
which 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.


 


“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.


 






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“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 to such Person;


 


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


 


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


 


“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 Paul Wotton as of the Effective Date and (b) Chief Financial
Officer, who is Ted Myles 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 Perfection Certificate, any Bank Services Agreement, any subordination agreement, any note, or notes or guaranties executed
by Borrower, and any other present or future agreement by Borrower with or for the benefit of 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.


 


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


 


“Obligations”
are Borrower’s obligations 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, or otherwise, including, without limitation, interest
accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of Borrower assigned to Bank, and to perform
Borrower’s duties under the Loan Documents.


 






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


 


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


 


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


 


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


 


“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 secured by Liens permitted under clauses (a) and (c) of the definition of “Permitted Liens” hereunder;
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 (including, without limitation, Subsidiaries) existing on the Effective Date and shown on the Perfection Certificate;


 


(b)          Investments consisting of Cash Equivalents;


 


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


 


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


 


(e)          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;


 






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


 


(g)          Investments consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers and suppliers
who are not Affiliates, in the ordinary course of business; provided that this paragraph (g) 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 (i) not due and payable or (ii) being contested
in good faith and for which Borrower maintains adequate reserves on its Books, provided that no notice of any such Lien
has been filed or recorded under the Internal Revenue Code of 1986, as amended, and the Treasury Regulations adopted thereunder;


 


(c)          purchase money Liens or capital leases (i) on Equipment acquired or held by Borrower incurred for financing the acquisition
of the Equipment securing no more than One Hundred Thousand Dollars ($100,000.00) in the aggregate amount outstanding, or (ii)
existing on Equipment when acquired, if the Lien is confined to the property and improvements and the proceeds of the Equipment;
and


 


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


 


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


 


“Prepayment
Premium” shall be an additional fee payable to Bank in amount equal to:


 


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


 


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


 


(c)          for a prepayment
of the Term Loan Advances made after the second (2nd) anniversary of the Effective Date, but on or prior to the third
(3rd) anniversary of the Effective Date, one percent (1.0%) of the then outstanding principal amount of the Term Loan
Advances as of the date immediately and prior to such prepayment; and


 


(d)          for a prepayment
of the Term Loan Advances made after the third (3rd) anniversary of the Effective Date, but prior to the Term Loan Maturity
Date, zero percent (0.0%) of the then outstanding principal amount of the Term Loan Advances as of the date immediately and prior
to such prepayment.


 


“Prime Rate”
is the rate of interest per annum from time to time published in the money rates section of The Wall Street Journal or any successor
publication thereto as the “prime rate” in effect on the Effective Date; 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).


 






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


 


“Repayment
Schedule” means (i) with respect to the Term A Loan Advance, the period of time equal to thirty-six (36) consecutive
months, and (ii) with respect to the Term B Loan Advance, the period of time equal to thirty-six (36) consecutive months, provided,
however, that upon the occurrence of the Term B Extension Event, the Repayment Schedule for the Term B Loan Advance shall mean
the period of time equal to thirty (30) months.


 


“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 and 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.


 


“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.


 


“Term A Loan
Advance” is defined in Section 2.1.1(a).


 


“Term B Draw
Period” is the period of time commencing upon the occurrence of the Term B Milestone Event and continuing through the
earlier to occur of (a) August 31, 2016, or (b) an Event of Default.


 


“Term B Extension
Event” is confirmation by Bank that Borrower has (a) achieved the AMD Requirement, and (b) received, after the Effective
Date, but prior to August 1, 2016, unrestricted and unencumbered net cash proceeds in an amount of Fifty Million Dollars ($50,000,000.00)
from the issuance and sale by Borrower of its equity securities.


 


“Term B Loan
Advance” is defined in Section 2.1.1(a).


 






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“Term B Milestone
Event” means confirmation by Bank, in Bank’s reasonable discretion, on or prior to August 31, 2016, that Borrower
has (a) successfully completed the first (1st) cohort study (the “First Cohort Study”) of the Borrower’s dry
age-related macular degeneration Phase 2 clinical trial (the “AMD Trial”), including, without limitation, (i) data
which meets the primary or secondary endpoints of the First Cohort Study, including, without limitation, data which is void of
substantial evidence of graft failure with respect to, or rejection of, the transplanted cells which are the subject of the First
Cohort Study, and (ii) evidence that the First Cohort Study has produced sufficient favorable safety data which supports the advancement
of the AMD Trial into a second (2nd) cohort study ((a)(i)-(ii), collectively, the “AMD Requirement”), and (b) on or
prior to December 31, 2015 (i) entered into an agreement with one or more licensed broker-dealers providing for “at the market”
purchases of the Borrower’s securities from time to time by such broker-dealers or their customers (an “ATM Facility”),
(ii) has an effective registration statement on Form S-3 for the offering by the Borrower, on a delayed or continuous basis pursuant
to Rule 415 promulgated under the Securities Act of 1933, as amended, of its securities in connection with the ATM Facility, and
(iii) obtained all consents and approvals of its stockholders, regulatory authorities (including, without limitation, NASDAQ) and
other third parties necessary for the Borrower to offer and sell its securities pursuant to the ATM Facility.


 


“Term Loan
Advance” or “Term Loan Advances” is defined in Section 2.1.1(a).


 


“Term Loan
Maturity Date” is July 1, 2019.


 


“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.


 


[Signature page follows.]


 






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IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be executed as a sealed instrument under the laws of the Commonwealth of Massachusetts
as of the Effective Date.


 


BORROWER:


 


OCATA THERAPEUTICS, INC.


 


By_________________________________________

Name:______________________________________

Title:_______________________________________


 


BANK:


 


SILICON VALLEY BANK


 


By_________________________________________

Name:______________________________________

Title:_______________________________________


 






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EXHIBIT A – COLLATERAL DESCRIPTION


 


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


 


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


 


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


 


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


 


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


 


EXHIBIT B


COMPLIANCE CERTIFICATE


 





	TO: SILICON VALLEY BANK	Date:__________________________
	FROM: OCATA THERAPEUTICS, INC.	 



 


The undersigned authorized
officer of OCATA THERAPEUTICS, INC. (“Borrower”) certifies that under the terms and conditions of the Loan and Security
Agreement between Borrower and Bank (the “Agreement”):


 


(1) Borrower is
in 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.


 






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	Please indicate compliance status by circling Yes/No under “Complies” column.
	 
	Reporting Covenants	Required	Complies
	 	 	 
	Quarterly financial statements	Quarterly within 45 days	Yes   No
	Compliance Certificate	Monthly within 30 days	Yes   No
	Annual financial statement (CPA Audited)	The earlier of (i) FYE within 150 days or (ii) within 5 days of SEC filing	Yes   No
	10-Q, 10-K and 8-K	Within 5 days after filing with SEC	Yes   No
	Board Approved Projections	FYE within 45 days or as updated	Yes   No
	 


 


 


Other Matters


 


	Have there been any amendments of or other changes to the capitalization table of Borrower and to the Operating Documents of Borrower or any of its Subsidiaries?  If yes, provide copies of any such amendments or changes with this Compliance Certificate.	Yes	No


 


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


 





 



 


 






 


	
        OCATA THERAPEUTICS, INC.

         

         

        By: _________________________

        Name: _______________________

        Title: ________________________

         
	
        BANK USE ONLY

         

        Received by: _________________________

        authorized
        signer

        Date: _______________________________

         

        Verified: _____________________________

        authorized
        signer

        Date: _______________________________

         

        Compliance Status:    Yes
             No



 






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EXHIBIT C – LOAN PAYMENT/ADVANCE
REQUEST FORM


Deadline
for same day processing is 1:00 p.m. Eastern Time


 


	Fax To: 	Date: _____________________



 


Loan
Payment: Ocata Therapeutics,
Inc.


From Account
#________________________________ To Account #___________________________________________


(Deposit Account #)                                                                              (Loan
Account #)


Principal
$____________________________________ and/or Interest $__________________________________________


Authorized Signature: _________________________________
Phone Number: ___________________________


Print Name/Title: __________________________________________


 


 


Loan
Advance:


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


From Account
#________________________________ To Account #___________________________________________


(Loan Account #)                                                                              (Deposit
Account #)


Amount of Advance $___________________________


All Borrower’s representations and warranties
in the 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:
_____________________________     Phone Number: _____________________________


Print Name/Title:  _____________________________


 


 


Outgoing
Wire Request:


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


Deadline for same day processing is 1:00 p.m.,
Eastern Time


 


Beneficiary Name: _____________________________     Amount
of Wire: $ _____________________________


Beneficiary Bank: _____________________________     Account
Number:  _____________________________


City and State:  _____________________________


Beneficiary Bank Transit (ABA) #: __________________
Beneficiary Bank Code (Swift, Sort, Chip, etc.):  ______________________


(For International Wire
Only)


Intermediary Bank: _____________________________     Transit (ABA) #: 
_____________________________


For Further Credit to:  _____________________________________________________


Special Instruction:  _______________________________________________________


 


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


 


Authorized Signature: ___________________________     2nd
Signature (if required): _____________________________


Print Name/Title: ______________________________       Print
Name/Title: ____________________________________


Telephone #:  ______________________________             Telephone #: _______________________________________


 






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