Document:

Exhibit 10.18

RESTRICTED STOCK UNIT AGREEMENT

UNDER THE AQUESTIVE THERAPEUTICS, INC.

2018 EQUITY INCENTIVE PLAN

THIS RESTRICTED STOCK UNIT AGREEMENT (this “Agreement”) between Aquestive Therapeutics, Inc. (“Aquestive”) and the individual specified on the Notice of Grant (the “Grantee”) is made as of the date of grant specified on the Notice of Grant to which this Agreement is attached (the “Grant Notice”).  The Date of Grant specified on the Grant Notice is referred to herein as the “Grant Date.”

RECITALS

WHEREAS, Aquestive maintains the Aquestive Therapeutics, Inc. 2018 Equity Incentive Plan (as it may be amended from time to time, the “Plan”) for the benefit of its employees, directors and consultants; and

WHEREAS, the Plan permits Aquestive to award restricted stock units with respect to shares of Aquestive’s common stock, $0.001 par value per share (“Shares”), subject to the terms of the Plan.

NOW, THEREFORE, in consideration of these premises and the agreements set forth herein, the parties, intending to be legally bound hereby, agree as follows:

1.          Award of RSUs.  Aquestive hereby grants to the Grantee, as of the Grant Date, the number of restricted stock units specified on the Grant Notice (the “RSUs”).  With respect to each RSU, the Grantee will be entitled to receive one Share upon the settlement of such RSU (the “RSU Shares”).  The RSUs are subject to the terms set forth herein, and the terms of the Plan, which terms and provisions are incorporated herein by reference.  Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Plan.

2.          Vesting; Settlement.

(a)          The RSUs shall be unvested upon the Grant Date and shall vest in 36 equal monthly installments, commencing on the last business day of the month immediately following the month in which the Grant Date occurs and continuing for each of the next 35 months immediately following such month (with vesting to occur on the last business day of any such month), subject to Grantee’s continued employment with Aquestive from the Grant Date through the applicable vesting date; provided, however, that (i) in the event that prior to the date on which all of the RSUs have become fully vested, Grantee’s employment is terminated by Aquestive other than for Cause, is terminated by Aquestive due to Grantee’s Disability, is terminated as the result of Grantee’s death or is terminated by Grantee for Good Reason, then all RSUs that are unvested as of such date shall immediately vest in full upon such termination of employment and (ii) vesting and settlement of fractional RSUs shall be delayed until a whole number of RSUs have become vested.  If the Grantee’s employment with Aquestive is terminated by Aquestive for Cause or by the Grantee without Good Reason, then all RSUs that are unvested as of the date of such termination of employment shall be forfeited with no payment or other compensation due to the Grantee.

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(b)          Unless required to be delayed pursuant to the third and fourth sentences of Section 18 of the Plan, an RSU shall be settled by delivery to Grantee of one Share as soon as reasonably practicable following the date on which such RSU becomes vested and in any event within 30 days after the vesting date.

(c)          Prior to the settlement of the RSUs, the Grantee shall have no rights of a stockholder with respect to the RSU Shares, including, without limitation, the right to receive dividends with respect to such RSU Shares or the right to vote such RSU Shares.  Notwithstanding the foregoing or anything contained in this Agreement to the contrary, upon the settlement of any RSU, the Grantee shall be entitled to receive a number of additional Shares equal to the quotient of (x) the per Share amount of dividends with a record date during the period commencing on the Grant Date and ending on the date immediately preceding such settlement date, multiplied by the number of RSUs then being settled and (y) the Fair Market Value of one Share on  the date immediately preceding the settlement date (provided (i) any fractional share instead shall be paid in cash and (ii) if there are not sufficient Shares under the Plan, such dividend equivalents instead shall be paid in cash).  The right to any such Shares or cash payments will be forfeited upon the forfeiture of the RSU to which they relate, with no compensation or other payment due to Grantee.

3.          Transferability of RSUs.  The RSUs may not be sold, pledged, assigned, hypothecated, gifted, transferred or disposed of in any manner either voluntarily or involuntarily by operation of law, other than by will or by the laws of descent and distribution or except as and to the extent permitted by Section 12 of the Plan

4.          Conditions on All Transfers of RSU Shares.  Notwithstanding anything to the contrary contained in this Agreement or the Plan, no Transfer of an RSU Share shall be made, or, if attempted or purported to be made, shall be effective, unless and until Aquestive is satisfied that the Transfer will not violate any federal or state securities law or any other law or agreement (including this Agreement).  If the Transfer would violate any such law or agreement and the Grantee nevertheless attempts or purports to engage in a Transfer of RSU Shares, then Aquestive shall not recognize such Transfer on the books and records of Aquestive and such Transfer will be null and void ab initio.  In addition, the Grantee will be liable to Aquestive for damages, if any, which may result from such attempted or purported Transfer.

5.          No Promise of Employment or Other Service.  Neither the Plan nor the RSUs nor the holding of RSU Shares will confer upon the Grantee any right to continue in the employ or other service of Aquestive or any Subsidiary, or limit, in any respect, the right of Aquestive or any Subsidiary to discharge the Grantee at any time, with or without Cause and with or without notice.

6.          Withholding.  In order to satisfy the Grantee’s tax withholding obligations relating to the RSUs, Aquestive shall retain the whole number of Shares from those otherwise being delivered in settlement of the RSUs whose Fair Market Value on the date of settlement equals the amount required to be withheld, provided that the Grantee shall be responsible for making arrangements to satisfy any additional required withholding resulting from any fractional Share not being withheld (and Aquestive and its Subsidiaries shall have the right to withhold from any payroll or other amounts otherwise due to the Grantee the amount of such withholding taxes due).  Withholding shall occur at the minimum required tax withholding rates.

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7.          Section 409A.  It is intended that the RSUs and this Agreement be exempt from Section 409A of the Code or, to the extent not so exempt, comply with the requirements of Section 409A of the Code, and this Agreement shall be interpreted consistently with the foregoing without resulting in any increase in the amounts owed hereunder by Aquestive or any Subsidiary.  [Notwithstanding anything contained in the Plan or this Agreement to the contrary, except as specifically provided in Section [__] of Grantee’s employment agreement with Aquestive, dated as of [____], 2018 (as amended and/or restated from time to time, the “Employment Agreement”), neither Aquestive nor any Subsidiary shall have any liability or obligation to the Grantee or to any other person or entity for taxes, interest, penalties or fines relating to the RSUs, the RSU Shares, this Agreement or the Plan (including any of the foregoing resulting from the failure of this Agreement to be exempt from or comply with Section 409A of the Code).]

8.          The Plan.  The Grantee has received a copy of the Plan, has read the Plan and is familiar with its terms, and hereby accepts the RSUs subject to all of the terms and provisions of the Plan, as amended from time to time, and this Agreement.  Pursuant to the Plan, the Committee is authorized to interpret the Plan and to adopt rules and regulations not inconsistent with the Plan as it deems appropriate.  The Grantee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee with respect to the Plan, this Agreement, the RSUs, the RSU Shares or any agreement relating to the RSUs or the RSU Shares.  In the event of a conflict between the terms of the Plan and the terms of this Agreement, the terms of the Plan shall control.

9.          Governing Law.  This Agreement will be construed in accordance with the laws of the State of Delaware, without regard to the application of the principles of conflicts of laws of Delaware or any other jurisdiction.

10.        Severability.  All provisions of this Agreement are distinct and severable and if any clause shall be held to be invalid, illegal or against public policy, the validity or the legality of the remainder of this Agreement shall not be affected thereby, and the remainder of this Agreement shall be interpreted to give maximum effect to the original intention of the parties hereto.

11.        Amendment.  Subject to the provisions of the Plan, this Agreement may only be amended by a writing signed by each of the parties hereto.

12.        Entire Agreement.  This Agreement, together with the Grant Notice and the Plan, and the other exhibits attached thereto or hereto, represents the entire agreement between the parties hereto relating to the subject matter hereof, and merges and supersedes all prior and contemporaneous discussions, agreements and understandings of every nature relating to the award of the RSUs to Grantee by Aquestive.  [The Grantee expressly acknowledges and agrees that the grant of the RSUs covered by this Agreement satisfies all of Aquestive’s obligations under Section [___] of the Employment Agreement, and from and after the Grant Date, Grantee no longer has any rights under Section [____] of the Employment Agreement.]

 

3Exhibit 10.9

AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT

This AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is made as of June 29, 2018, by and among XPLORE TECHNOLOGIES CORP. (“Technologies”), XPLORE TECHNOLOGIES CORPORATION OF AMERICA (“XTCA” and together with Technologies, each a “Borrower” and collectively, the “Borrowers”),  XPLORE TECHNOLOGIES INTERNATIONAL CORP. (“Guarantor”), and BANK OF AMERICA, N.A. (“Lender”).

W I T N E S S E T H :

WHEREAS, the parties hereto have entered into a Loan and Security Agreement, dated as of April 17, 2017 (as amended by the Amendment to Loan and Security Agreement, dated as of January 25, 2018, as the same is now in effect and may be further amended or otherwise modified from time to time, the “Loan Agreement”) and various instruments, guaranties, agreements and other documents executed and/or delivered in connection therewith (all of the foregoing, together with the Loan Agreement, as the same now exist or may hereafter be amended, restated, renewed, extended, substituted, modified or supplemented from time to time, collectively, the “Loan Documents”); and

WHEREAS, Borrowers and Lender have agreed to amend certain provisions of the Loan Agreement, and Lender is willing to do so, subject to the terms and conditions set forth herein.

NOW THEREFORE, in consideration of the foregoing, and for good and other valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

SECTION 1.          DEFINITIONS.

SECTION 2.          Definitions in Loan Agreement.  Capitalized terms used in this Amendment and not otherwise defined shall have the meanings ascribed to such terms in the Loan Agreement.

SECTION 2.          AMENDMENTS

2.1          Section 1.1 of the Loan Agreement is hereby amended to insert the following defined terms in the appropriate alphabetical order:

“Amendment No. 2 Effective Date: May 30, 2018.”

“Eligible Foreign Uninsured Accounts: (i) Accounts that meet the requirements of Eligible Accounts, except clause (g) of such definition, which are not supported by a letter of credit or credit insurance acceptable to Lender and (ii) the portion of any Accounts that meet the requirements of Eligible Accounts, except clause (g) of such definition, in excess of the amount supported by a letter of credit or credit insurance policy acceptable to Lender.”

“Eligible Foreign Uninsured Advance Rate: the percentages set forth opposite the respective periods set forth below:

	
Period

	
Percentage

	
Amendment No. 2 Effective Date through and including June 22, 2018

	
65%

	
Period

	
Percentage

	
June 23, 2018 through and including June 29, 2018

	
55%

	
June 30, 2018 through and including July 6, 2018

	
50%

	
July 7, 2018 through and including July 13, 2018

	
45%

	
July 14, 2018 through and including July 20, 2018

	
35%

	
July 21, 2018 through and including July 27, 2018

	
25%

	
July 28, 2018 through and including August 3, 2018

	
15%

	
August 4, 2018 through and including August 10, 2018

	
5%

	
August 11, 2018 through and including August 17, 2018

	
0%

	
August 18, 2018 and thereafter

	
0%

2.2          The definition of “Accounts Formula Amount” appearing in Section 1.1 of the Loan Agreement is hereby amended and restated in its entirety to read as follows:

“Accounts Formula Amount: an amount equal to the sum of (i) up to 85% of Borrowers’ domestic Eligible Accounts, plus (ii) up to 85% of Borrowers’ Eligible Foreign Insured Accounts, plus (iii) up to the Eligible Foreign Uninsured Advance Rate of Borrowers’ Eligible Foreign Uninsured Accounts, provided, that, in no event shall the aggregate amount of Revolver Loans made in respect of Eligible Foreign Insured Accounts and Eligible Foreign Uninsured Accounts exceed the following percentages of the Account Formula Amount during the respective periods set forth below:

	
Period

	
Percentage of the Accounts Formula Amount

	
Amendment No. 2 Effective Date through and including June 29, 2018

	
50%

	
June 30, 2018 through and including July 6, 2018

	
40%

	
July 7, 2018 through and including July 13, 2018

	
40%

	
July 14, 2018 through and including July 20, 2018

	
40%

	
July 21, 2018 through and including July 27, 2018

	
40%

	
July 28, 2018 through and including August 3, 2018

	
40%

	
August 4, 2018 through and including August 10, 2018

	
30%

	
August 11, 2018 through and including August 17, 2018

	
25%

	
August 18, 2018 and thereafter

	
25%

2.3          Clause (c) of the definition of “Eligible Account” appearing in Section 1.1 of the Loan Agreement is hereby amended and restated in its entirety to read as follows:

“(c) when aggregated with other Accounts owing by the Account Debtor (or its Affiliates), it exceeds 15% (or in the case of (i) Verizon Communications, Inc., its Affiliates, and its designated fulfillment partners (i.e., Software House International), such percentage shall be 25%, (ii) AT&T Inc., its Affiliates, and its designated fulfillment partners (i.e., Prosys), such percentage shall be 25%, and (iii) Synnex Corporation, its Affiliates, such percentage shall be (x) 35% from the Amendment No. 2 Effective Date through and including August 10, 2018, and (y)

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25% from August 11, 2018 and thereafter) of the aggregate Eligible Accounts (or such higher percentage as Lender may establish for the Account Debtor from time to time);”

2.4          The definition of “Financial Covenant Trigger Period” appearing in Section 1.1 of the Loan Agreement is hereby deleted in its entirety.

2.5          The definition of “Increased Reporting Trigger Period” appearing in Section 1.1 of the Loan Agreement is hereby amended and restated in its entirety to read as follows:

“Increased Reporting Trigger Period: the period (a) commencing on the day that (i) a Default or Event of Default occurs, or (ii) the sum of Availability, minus the aggregate amount of Borrower’s accounts payables stretched beyond their customary payment practices, for each of the preceding five (5) consecutive days has been less than the greater of (x) 10% of the Borrowing Base and (y) $500,000; and (b) continuing until, during each of the preceding sixty (60) consecutive days, (i) no Default or Event of Default has existed and (ii) the sum of Availability, minus the aggregate amount of Borrower’s accounts payables stretched beyond their customary payment practices, has been more than the greater of (x) 10% of the Borrowing Base and (y) $500,000.”

2.6          The definition of “Inventory Formula Amount” appearing in Section 1.1 of the Loan Agreement is hereby amended and restated in its entirety to read as follows:

“Inventory Formula Amount: an amount equal to the lesser of:

		(a)	
up to 65% of the Value of total Eligible Inventory consisting of finished goods; and

		(b)	
up to 85% of the NOLV of Eligible Inventory consisting of finished goods.

provided, that, in no event shall (i) any slow-moving Inventory (i.e. Inventory that has not been sold or shipped within twelve (12) months after the date of production) be deemed to be eligible for borrowing purposes, and (ii) the aggregate amount of Revolver Loans made in respect of Eligible Inventory exceed the following percentages of the Borrowing Base during the respective periods set forth below:

	
Period

	
Percentage of the Borrowing Base

	
Amendment No. 2 Effective Date through and including June 22, 2018

	
60%

	
June 23, 2018 through and including June 29, 2018

	
50%

	
June 30, 2018 through and including July 6, 2018

	
45%

	
July 7, 2018 through and including July 13, 2018

	
40%

	
July 14, 2018 through and including July 20, 2018

	
40%

	
July 21, 2018 through and including July 27, 2018

	
40%

	
July 28, 2018 through and including August 3, 2018

	
40%

	
August 4, 2018 through and including August 10, 2018

	
40%

	
August 11, 2018 through and including August 17, 2018

	
35%

	
August 18, 2018 and thereafter

	
35%

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2.7          Section 8.1 of the Loan Agreement is hereby amended and restated in its entirety to read as follows:

“8.1.          Borrowing Base Reports.

8.1.1          By the Tuesday of each week, Borrowers shall deliver to Lender a full Borrowing Base Report with related supporting schedules prepared as of the close of business of the previous week, and at such other times as Lender may request; provided, that, from August 18, 2018 and at all times thereafter, during an Increased Reporting Trigger Period, Borrowers shall deliver to Lender such Borrowing Base Report on a daily basis, prepared as of the close of business of the previous Business Day.

8.1.2          By the 15th day of each month, Borrowers shall deliver to Lender a full Borrowing Base Report as of the close of business of the previous month, with reconciliations to the most recent Borrowing Base Report delivered pursuant to Section 8.1.1 prior to such month end.”

2.8          The first sentence of Section 8.2.1 of the Loan Agreement is hereby amended by deleting the reference to “20th day” appearing therein and substituting “15th day” therefor.

2.9          Section 10.1.2(a) of the Loan Agreement is hereby amended and restated in its entirety to read as follows:

“(a) as soon as available, and in any event (i) on or prior to July 6, 2018 with respect to Client’s Fiscal Year ended March 31, 2018, and (ii) within 90 days after the close of each other Fiscal Year, balance sheets as of the end of such Fiscal Year and the related statements of income, cash flow and stockholders equity on a consolidated and consolidating basis for Borrowers and their Subsidiaries, which consolidated statements shall be audited on standards reasonably satisfactory to Lender (it being acknowledged and agreed that accounting and auditing principles, rules, standards and practices promulgated, approved or incorporated by the SEC or the PCAOB shall be satisfactory) by a firm of independent certified public accountants of recognized standing selected by Borrowers and reasonably acceptable to Lender, and shall set forth comparative corresponding figures for the preceding Fiscal Year;”

2.10          Section 10.1.2(c) of the Loan Agreement is hereby amended and restated in its entirety to read as follows:

“(c) as soon as available, and in any event (i) on or prior to July 15, 2018 with respect to the months ended April 30, 2018 and May 31, 2018 and (ii) within 30 days after the end of each month (but within 60 days after the last month in a Fiscal Year), unaudited balance sheets as of the end of such month and the related statements of income and cash flow for such month and for the portion of the Fiscal Year then elapsed, on consolidated and consolidating basis for Borrowers and its Subsidiaries and Affiliates, setting forth in comparative form corresponding figures for the preceding Fiscal Year and certified by an authorized officer of Borrower Agent as prepared in accordance with GAAP and fairly presenting the financial position and results of operations for such month and period, subject to normal year end adjustments and the absence of footnotes;”

2.11          Section 10.3 of the Loan Agreement is hereby amended and restated in its entirety to read as follows:

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“10.3.          Financial Covenants - Fixed Charge Coverage Ratio.  Borrowers shall maintain a Fixed Charge Coverage Ratio of not less than 1.0 to 1.0, determined as of the last day of the Fiscal Quarter for which financial statements were most recently required to be delivered pursuant to Section 10.1.2(b) and of each Fiscal Quarter thereafter, in each case for the trailing four Fiscal Quarter Period then ended.  Compliance with the foregoing shall be evidenced by delivery of the Compliance Certificate required under Section 10.1.2(d).”

SECTION 3.          AMENDMENT FEE

 

On the date hereof, in consideration of the amendments to the Loan Agreement requested by Borrowers and agreed to by Lender, Borrowers shall pay to Lender an amendment fee in the amount of $25,000 (the “Amendment Fee”).  The Amendment Fee shall be fully earned, due and payable on the date hereof and shall not be subject to refund, rebate or proration for any reason whatsoever.

SECTION 4.          PROVISIONS OF GENERAL APPLICATION

4.1          Binding Effect of Documents.  This Amendment and the other Loan Documents have been duly executed and delivered to the Lender by Borrowers and the Guarantor and are in full force and effect, as modified hereby.

4.2          Conditions to Effectiveness.  The effectiveness of the terms and provisions of this Amendment shall be subject to the receipt by Lender of this (i) Amendment, duly authorized, executed and delivered by Borrowers, Guarantor, and Lender, (ii) the Amendment Fee, and (iii) pro forma Borrowing Base Reports for the month ending May 31, 2018 and the week ended June 22, 2018, taking into account the amendments set forth in this Amendment, in each case in form and substance satisfactory to Lender.

4.3          Effect of this Amendment.  Except as modified pursuant hereto, no other changes or modifications to the Loan Documents are intended or implied and in all other respects the Loan Documents are hereby specifically ratified, restated and confirmed by all parties hereto as of the effective date hereof.  To the extent of conflict between the terms of this Amendment and the other Loan Documents, the terms of this Amendment shall control.  The Loan Agreement and this Amendment shall be read and construed as one agreement.

4.4          Further Assurances.  The parties hereto shall execute and deliver such additional documents and take such additional action as may be reasonably necessary or desirable to effectuate the provisions and purposes of this Amendment.

4.5          Binding Effect.  This Amendment shall be binding upon and inure to the benefit of each of the parties hereto and their respective successors and assigns.

4.6          Governing Law.  THIS AMENDMENT SHALL BE INTERPRETED AND THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO DETERMINED IN ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO THE CONFLICT OF LAWS PROVISIONS) OF THE STATE OF NEW YORK; PROVIDED THAT THE PARTIES HERETO SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.

4.7          Counterparts.  This Amendment may be executed in one or more counterparts, each of which shall constitute but one and the same Amendment.  In making proof of this Amendment, it shall not be necessary to produce or account for more than one counterpart thereof signed by each of the parties

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hereto.  Delivery of a signature page hereto by telecopy or other electronic means shall be effective as delivery of a manually executed counterpart hereof.

[Signature page follows]

 

 

 

 

 

 

  

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IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment to Loan and Security Agreement as of the date first written above.

Borrowers:

XPLORE TECHNOLOGIES CORP., as a Borrower

By:                   /s/Tom Wilkinson                           

Name: Tom Wilkinson

Title:  CEO

XPLORE TECHNOLOGIES CORPORATION OF AMERICA, as a Borrower

By:                   /s/Tom Wilkinson                          

Name: Tom Wilkinson

Title:  CEO

Guarantor:

XPLORE TECHNOLOGIES INTERNATIONAL CORP., as a Guarantor

By:                   /s/Tom Wilkinson                           

Name: Tom Wilkinson

Title:  CEO

Lender:

BANK OF AMERICA, N.A., as Lender

By:                   /s/Tanner J. Pump                           

Name: Tanner J. Pump

Title:  SVP

 

 

Amendment No. 2 to Loan and Security Agreement

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