Document:

Exhibit
10.1

 

JOINDER
AND MODIFICATION NO. 2 TO

LOAN
AND SECURITY agreement

 

This
Joinder and Modification No. 2 to Loan and Security Agreement (this “Second Modification”) is entered into
as of June 30, 2018 (the “Second Modification Effective Date”) by and among (a) Partners for Growth IV,
L.P., a Delaware limited partnership (“PFG”), and (b) each of (i) CANCER GENETICS, INC., a Delaware
corporation (“Parent”), (ii) GENTRIS, LLC, a Delaware limited liability company (“Delaware
Subsidiary” and together with Parent, individually and collectively, jointly and severally, the “Existing Borrower”),
(iii) VIVOPHARM, LLC, a Delaware limited liability company (“Vivo”), and (iv) RDDT A VIVOPHARM COMPANY
PTY LTD, a company incorporated under the laws of Australia (“Australian Borrower”, and together with Vivo,
jointly and severally, individually and collectively, “New Borrower”) (Australian Borrower, together with Vivo
and Existing Borrower, jointly and severally, individually and collectively, “Borrower”).

 

Recitals

 

A.
PFG and Borrower entered into that certain Loan and Security Agreement dated as of March 22, 2017 (the “Loan Agreement”)
and the other Loan Documents pursuant to which PFG has made available to Borrower the principal amount of $6,000,000, all of which
is outstanding on the Second Modification Effective Date.

 

B.
PFG and Borrower have entered into that certain Conditional Waiver and Modification No. 1 to Loan and Security Agreement on
May 14, 2018 (the “First Modification”), pursuant to which PFG waived certain Specified Defaults (as set forth
therein), subject to the terms and conditions of the First Modification, and made certain modifications to the Loan Agreement.

 

C.
Existing Borrower has requested that PFG amend the Loan Agreement to (i) add new borrowers to the Loan Agreement and (ii)
make certain other revisions to the Loan Agreement as more fully set forth herein.

 

D.
In reliance upon the representations and warranties set forth below, PFG has agreed to so amend certain provisions of the
Loan Agreement, but only to the extent provided in this Second Modification, and only in accordance with the terms and subject
to the conditions set forth below.

 

Agreement

 

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

 

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

 

    	 	 	 

     

    

 

2.
Joinder to Loan Agreement. Vivo
and Australian Borrower hereby join the Loan Agreement and each of the Loan Documents as if each were originally named a “Borrower”
therein. Without limiting the generality of the preceding sentence, New Borrower agrees that it will be jointly and severally
liable, together with Existing Borrower, for the payment and performance of all obligations and liabilities of Borrower under
the Loan Agreement, including, without limitation, the Obligations. Each Borrower hereby appoints the other as agent for the other
for all purposes hereunder. Each Borrower hereunder shall be obligated to repay all Loans under the Loan Agreement, regardless
of which Borrower actually receives the benefit of Loans made to Borrower, as if each Borrower hereunder directly received all
Loans.

 

3.
Subrogation and Similar Rights.
Each Borrower waives any suretyship defenses available to it under the Code or any other applicable law. Each Borrower waives
any right to require PFG to: (i) proceed against any Borrower or any other person; (ii) proceed against or exhaust any security;
or (iii) pursue any other remedy. PFG may exercise or not exercise any right or remedy it has against any Borrower or any security
it holds (including the right to foreclose by judicial or non-judicial sale) without affecting any Borrower’s liability.
Notwithstanding any other provision of this Second Modification, the Loan Agreement or other Loan Documents, each Borrower waives
all rights that it may have at law or in equity (including, without limitation, any law subrogating Borrower to the rights of
PFG under the Loan Agreement) to seek contribution, indemnification or any other form of reimbursement from any other Borrower
or any other Person now or hereafter primarily or secondarily liable for any of the Obligations, for any payment made by Borrower
with respect to the Obligations in connection with the Loan Agreement or otherwise and all rights that it might have to benefit
from, or to participate in, any security for the Obligations as a result of any payment made by Borrower with respect to the Obligations
in connection with the Loan Agreement or otherwise. Any agreement providing for indemnification, reimbursement or any other arrangement
prohibited under this Section shall be null and void. If any payment is made to a Borrower in contravention of this Section, such
Borrower shall hold such payment in trust for PFG and such payment shall be promptly delivered to PFG for application to the Obligations,
whether matured or unmatured. The foregoing waivers (excluding under clauses (i), (ii) and (iii), above) shall be effective until
all Obligations have been indefeasibly paid in full.

 

4.
Grant of Security Interest.
To secure the prompt payment and performance of all the Obligations, New Borrower hereby grants to PFG a continuing lien upon
and security interest in all of New Borrower’s now existing or hereafter arising rights and interest in the Collateral,
whether now owned or existing or hereafter created, acquired or arising, and wherever located, including, without limitation,
all of New Borrower’s assets (including, without limitation, its Intellectual Property), and all New Borrower’s books
relating to the foregoing and any and all claims, rights and interest 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. New Borrower further covenants and agrees that by its execution hereof it shall provide all such information,
complete all such forms, and take all such actions, and enter into all such agreements, in form and substance reasonably satisfactory
to PFG that are reasonably deemed necessary by PFG in order to grant a valid, perfected first priority security interest to PFG
in the Collateral. New Borrower hereby authorizes PFG to file financing statements, without notice to Borrower, with all appropriate
jurisdictions in order to perfect or protect PFG’s interest or rights hereunder, including a notice that any disposition
of the Collateral, by any Borrower or any other Person, shall be deemed to violate the rights of the PFG under the Code.

 

    	 	2	 

     

    

 

5.
Representations and Warranties.
New Borrower hereby represents and warrants to PFG that all representations and warranties in the Loan Documents made on the part
of Existing Borrower are true and correct on the date hereof with respect to New Borrower, mutatis mutandis, with the same force
and effect as if New Borrower were named as “Borrower” in the Loan Documents in addition to Existing Borrower. Each
Obligor hereby represents and warrants that the Representations delivered by it in connection with this Second Modification are
true, correct and complete in all material respects as of the Second Modification Effective Date, and to the extent it has not
updated Representations previously delivered to PFG, it ratifies, confirms and reaffirms, all and singular, the terms and disclosures
contained in such prior-delivered Representations.

 

6.
Delivery of Documents.
New Borrower hereby agrees that the following documents shall be delivered to the PFG prior to or contemporaneously with delivery
of this Second Modification, each in form and substance satisfactory to the PFG:

 

	 	A.	Borrowing
    Resolutions - the completed Borrowing Resolutions for Vivo, together with the duly executed original signatures thereto;
	 	 	 
	 	B.	Constitutional
    Documents and Good Standing - the Operating Documents and long-form good standing certificate of Vivo certified by the
    Secretary of State of Delaware and each jurisdiction in which Vivo is qualified to conduct business, each as of a date no
    earlier than thirty (30) days prior to the date hereof;
	 	 	 
	 	C.	Australian
    Constitutional and Authority Documents - a certified copy of the Certificate of Registration and Constitution of each
    of Australian Borrower and Guarantor, as amended, a Verification Certificate containing a certified copy of extracts of meeting
    of the directors of each of Australian Borrower and Guarantor authorizing the execution of this Agreement and any other Loan
    Documents to which it is a party;
	 	 	 
	 	D.	Landlord
    Consent(s) - a landlord’s consent in favor of PFG for each of Vivo’s leased locations by the respective landlords
    thereof, together with the duly executed original signatures thereto;
	 	 	 
	 	E.	Signed
    Australian Security and Guarantee - duly executed original signatures to the Australian Security and Guarantee required
    by PFG;
	 	 	 
	 	F.	Share
    Transfer Forms - the duly executed blank share transfer form and, subject to the rights of the Senior Lender to hold the
    same in the first instance, the original share certificate for the issued shares in Australian Borrower;
	 	 	 
	 	G.	Lien
    Searches - certified copies, dated as of a recent date, of financing statement searches, as PFG may request, accompanied
    by written evidence (including any UCC and PPSR termination statements) that the Liens indicated in any such financing statements
    either constitute Permitted Liens or have been terminated or released;

 

    	 	3	 

     

    

 

	 	H.	IP
    Security - an Intellectual Property Security Agreement of each New Borrower and Guarantor, together with the duly executed
    original signature thereto (collectively, the “New Borrower IPSA”)
	 	 	 
	 	I.	Reaffirmation
    of IP Security – a Reaffirmation of Intellectual Property Security Agreement, together with Exhibits/Schedules showing
    new IP and Domains as from the original Loan Agreement date (the “IPSA Reaffirmation”);
	 	 	 
	 	J.	Representations
    Letter - the Representations of each New Borrower, together with the duly executed original signatures thereto (collectively,
    the “New Borrower Representations”);
	 	 	 
	 	K.	Representations
    Letter - Representations in respect of Guarantor, together with the duly executed original signatures thereto;
	 	 	 
	 	L.	Representations
    Letter - the Representations of Parent and Gentris, together with the duly executed original signatures thereto;
	 	 	 
	 	M.	Control
    Agreements - Duly executed original counterparts (or otherwise as required by the relevant depositaries) of Control Agreement
    required by PFG, to the extent not in effect on the Second Modification Effective Date;
	 	 	 
	 	N.	Legal
    Opinion - legal opinion of PFG’s Australian counsel in respect of Australian Borrower and Guarantor (authority/enforceability),
    in form and substance acceptable to PFG;
	 	 	 
	 	O.	Insurance
    Endorsements - evidence satisfactory to PFG that the insurance policies and endorsements required by the Loan Agreement
    are in full force and effect, together with appropriate evidence showing lender loss payable and/or additional insured clauses
    or endorsements in favor of PFG;
	 	 	 
	 	P.	Warrant
    Amendment - the Omnibus Warrant Amendment (contemplated by the First Modification but not completed) amending each of
    the Warrants issued on the Loan Agreement Effective Date to Partners for Growth IV, L.P., PFG Equity Investors, LLC and SVB
    Financial Group, in agreed form; and
	 	 	 
	 	Q.	Further
    Assurances - such other documents as PFG may reasonably request.

 

7.
Amendments to Loan Agreement.

 

7.1
Section 2.1 (Grant of Security Interest). Section 2.1 is amended by adding the following after the word “Borrower”
wherever it appears in Section 2.1: “...(other than Australian Borrower...)”.

 

7.2
Section 2.1 (Grant of Security Interest). Section 2.1 is amended by deleting the words “(Collectively, the “Collateral”)”
in the fourth line of that Section.

 

    	 	4	 

     

    

 

7.3
Section 3 (Representations, Warranties and Covenants of Borrower).
References in Section 3 to “Effective Date” shall be replaced with “Second Modification Effective Date”.

 

7.4
Section 3.2 (Name; Trade Names and Styles). Section 3.2 is amended in its entirety and replaced with the following:

 

“As
of the Second Modification Effective Date, the names of Obligor are their correct names as set forth in their respective Constitutional
Documents and (respective) Representations. Listed in the Representations are all prior names of Obligor and all of Obligor’s
present and prior trade names as from the Effective Date. Obligor shall give PFG 30 days’ prior written notice before changing
its name or doing business under any other name. Borrower has complied and Obligor will in the future comply, in all material
respects, with all laws relating to the conduct of business under a fictitious business name, if applicable to Obligor.”

 

7.5
Section 3.3 (Place of Business; Location of Collateral). Section 3.3 is amended by deleting the first sentence and
deleting the words “In addition”, just following, and beginning the sentence with “As of the Second Modification
Effective Date...”

 

7.6
Section 3.4 (Title to Collateral; Perfection; Permitted Liens). Section 3.4(a) is amended by replacing the first sentence
thereof with the following text:

 

“(a)
Existing Borrower is as of the Effective Date and Obligor is at the Second Modification Effective Date, and each of the foregoing
will at all times in the future be, the sole owner of all the Collateral, except for Collateral which is leased or licensed to
Obligor. The Collateral is and will remain free and clear of any and all Liens except for Permitted Liens. Upon the consummation
of the transactions contemplated hereby, PFG will have, and will continue to have, a First-Priority perfected and enforceable
Lien upon all of the Collateral, subject only to Permitted Liens. Borrower will at all times defend PFG and its interests in the
Collateral against all claims of others.”

 

7.7
Section 4.5 (Access to Collateral, Books and Records; Additional Reporting and Notices). Section 4.5 is amended to
replace references to “Borrower” with “Obligor”.

 

7.8
Section 4.6(xv) (Negative Covenants). Section 4.6(xv) is amended by replacing the existing text in its entirety with
the following:

 

“(xv)
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 Lien granted herein or in the Australian Security and Guarantee, or enter into any agreement, document,
instrument or other arrangement (except with or in favor of PFG and the Senior Lender) 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 otherwise
permitted in Section 3.13 hereof and the definition of Permitted Liens;”

 

7.9
Section 4.9 (Further Assurances). Section 4.9 is amended by deleting the text “this Agreement” appearing in the
fourth line thereof and inserting in lieu thereof the text “the Loan Documents”.

 

7.10
Section 5.4 (Survival of Certain Obligations). Section 5.4 of the Loan Agreement is amended and replaced in its entirety
with the following:

 

“
5.4 Survival of Certain Obligations. Without limiting the survival of obligations addressed otherwise in this Agreement
and notwithstanding any other provision of this Agreement, all covenants, representations and warranties made in the Loan Documents
continue in full force until the Loan Documents have terminated pursuant to its terms and all Obligations (other than obligations
which, by their terms, are to survive the termination of this Agreement) have been paid in full and satisfied. The obligation
of Borrower in Section 8.9 to indemnify PFG shall survive until the statute of limitations with respect to such claim or cause
of action shall have run.”

 

    	 	5	 

     

    

 

7.11
Section 6.1 (Events of Default). Section 6.1 is amended by deleting the text “this Agreement” in the opening
paragraph and inserting in lieu thereof the text “the Loan Documents”.

 

7.12
Section 6.1(h) (Events of Default). Section 6.1(h) is amended by replacing references to “Borrower” and
“Borrower or any Guarantor” with “Obligor”.

 

7.13
Section 6.1(h) (Events of Default). Section 6.1(h) is amended by deleting the word “or” in the sixth line
thereof and adding the following at the end of clause (h) as a new subclause (v):

 

“(v)
in respect of Australian Borrower, without limiting any of the foregoing: (A) it is taken to have failed to comply with a statutory
demand under section 459(F)(1) of the Corporations Act; (B) it must be presumed by a court to be insolvent under section 459(C)(2)
of the Corporations Act; or (C) it is the subject of a circumstance specified in section 461 of the Corporations Act (whether
or not an application to court has been made under that section); or”

 

7.14
Section 6.1(m) (Events of Default. Section 6.1(m) is amended and replaced in its entirety with the following:

 

“a
default or breach shall occur under any other Loan Document, including a default or breach by Guarantor of its representations,
warranties and undertakings under the Australian Security and Guarantee, which default or breach shall be continuing after the
later of cure period expressly specified in such Loan Document or ten (10) days;”

 

7.15
Section 6.3 (Standards for Determining Commercial Reasonableness). Section 6.3 shall be amended by inserting the following
at the beginning of the first sentence thereof: “Except to the extent that Australian law would otherwise require in respect
of Australian Borrower...”

 

7.16
Section 7, Clause (i). Clause (i) within the definition of “Permitted Liens” is hereby amended in its entirety
and replaced with the following:

 

“(i)
purchase money Liens and capital leases (including Liens arising under any retention of title, hire purchase or conditional sales
arrangement or arrangements having similar effect) (i) on Equipment acquired or held by Borrower incurred for financing the acquisition
of the Equipment securing no more than (A) $1,000,000 in the aggregate amount outstanding with respect to Parent and Delaware
Subsidiary and (B) A$15,000 with respect to Australian Borrower or Guarantor, or (ii) existing on such Equipment when acquired,
if the Lien is confined to the property and improvements and the proceeds of the Equipment;”

 

7.17
Section 7 (Definitions). References within the definition of “Permitted Liens” to “Borrower”
shall be replaced with references to “Obligor”.

 

7.18
Section 7 (Definitions). Section 7 is amended by inserting the following new definitions or, as applicable with respect
to existing definitions, restated definitions, to appear alphabetically therein:

 

“
“ADI Account” is any “ADI account” as defined in the PPSA with such additions to such term as
may hereafter be made.”

 

    	 	6	 

     

    

 

“
“Australian Borrower” is RDDT A vivoPharm Company Pty Ltd ACN 123 380 110, a company incorporated under the
laws of Australia and a Borrower hereunder.”

 

“
“Australian Insolvency Proceeding” means in respect of Australian Borrower or the Australian Parent: (a) except
with PFG’s consent: (i) it is the subject of a Liquidation, or an order or an application is made for its Liquidation; or
(ii) an effective resolution is passed or meeting summoned or convened to consider a resolution for its Liquidation; (b) an External
Administrator is appointed to it or any of its assets or a step is taken to do so or any related body requests such an appointment;
(c) a step is taken under section 601AA, 601AB or 601AC of the Corporations Act to cancel its registration; or (d) an analogous
or equivalent event to any listed above occurs in any jurisdiction.”

 

“
“Australian Parent” is vivoPharm Pty Ltd ACN 106 101 615, a company incorporated under the laws of Australia
and a Guarantor hereunder.”

 

“
“Australian Security and Guarantee” means the document titled “General Security Deed and Guarantee and
Indemnity” executed by Australian Borrower and Australian Parent in favor of PFG dated as of the Second Modification Effective
Date, as may be amended, modified, restated, replaced or supplemented from time to time.”

 

“
“Change in Control” means (a) any event, transaction, or occurrence as a result of which any “person”
(as such term is defined in Sections 3(a)(9) and 13(d)(3) of the Securities Exchange Act of 1934, as an amended (the “Exchange
Act”)), other than a trustee or other fiduciary holding securities under an employee benefit plan of Borrower, is or becomes
a beneficial owner (within the meaning Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of
Borrower, representing forty nine percent (49%) or more of the combined voting power of Borrower’s then outstanding securities
in a single transaction or a series of related transactions (other than by the sale of Borrower’s equity securities in a
public offering or to venture capital or private equity investors so long as Borrower identifies to PFG the venture capital or
private equity investors at least seven (7) Business Days prior to the initial closing of the transaction and provides to PFG
a description of the material terms of the transaction and such other information as PFG may reasonably request); (b) 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
and the Australian Security and Guarantee); or (c) without limiting the foregoing, in respect of the Australian Borrower or the
Australian Parent, there is a change of Control where ‘Control’: (i) has the meaning given in section 50AA of the
Corporations Act; (ii) in respect of an ‘entity’ (as defined in the Corporations Act) includes the direct or indirect
power to directly or indirectly direct the management or policies of the entity or control the membership or voting of the board
of directors or other governing body of the entity; and (iii) includes owning or controlling, directly or indirectly, more than
fifty percent (50.0%) of the shares or units in an entity.”

 

“
“Code” means (a) the Uniform Commercial Code as adopted and in effect in the State of California from time
to time, and (b) with respect to Australian Borrower and to any assets located in Australia, the PPS Law.”

 

“
“Collateral”:

 

(a)
for each Borrower other than the Australian Borrower; has the meaning set forth in Section 2 above; and

 

(b)
for the Australian Borrower, has the meaning given to that term in the Australian Security and Guarantee.”

 

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

 

“
“Constitutional Document” means, as to any Person, such Person’s formation documents, as last certified
by the Secretary of State (or equivalent Governmental Body) of such Person’s jurisdiction of organization, together with,
(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 operating or similar agreement), (c) if such Person is a partnership, its partnership agreement
(or similar agreement), (d) if such Person is a statutory joint venture company or similar entity, its joint venture (or similar)
agreement, each of the foregoing with all current amendments or modifications thereto and (e) with respect to any Australian Borrower
or Guarantor, means its constitution.

 

    	 	7	 

     

    

 

“
“Corporations Act” means the Corporations Act 2001 (Cth).”

 

“
“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, except where the terms “Australian Dollars”
or “A$” are used to denote lawful money of Australia.”

 

“
“External Administrator” means in respect of Australian Borrower or the Australian Parent, an administrator,
controller or managing controller (each as defined in the Corporations Act), trustee, provisional liquidator, liquidator or any
other person (however described) holding or appointed to an analogous office or acting or purporting to act in an analogous capacity.”

 

“
“Financial Statements” means consolidated financial statements of Obligor, including a balance sheet, income
statement and cash flow and, in the case of monthly-required financial statements, showing data for the month being reported and
a history showing each month from the beginning of the relevant fiscal year.”

 

“
“GAAP”, with respect to a US Person, means generally accepted accounting principles in the US, consistently
applied, and in respect of Australian Borrower, means accounting standards, principles and practices generally accepted and consistently
applied in Australia.”

 

“
“Guarantor” is any present or future guarantor of the Obligations, including, without limitation, the Australian
Parent.”

 

“
“Guaranty” is any guarantee of all or any part of the Obligations, as the same may from time to time be amended,
restated, modified or otherwise supplemented.”

 

“
“Insolvency Proceeding” means a US Insolvency Proceeding or an Australian Insolvency Proceeding.”

 

“
“IPSA” is, collectively, (i) that certain Intellectual Property Security Agreement dated as of the Effective
Date by and between PFG and each of Parent and Delaware Subsidiary, (ii) that certain Intellectual Property Security Agreement
dated as of the Second Modification Effective Date by and between Vivo and PFG, and (iii) that certain Intellectual Property Security
Agreement dated as of the Second Modification Effective Date by and between Australian Borrower and PFG, as each may be amended,
modified or restated from time to time.”

 

“
“Lender Expenses” means, in each case without limitation as to type and kind: reasonable Professional Costs,
and all filing, recording, search, title insurance, appraisal, audit, and other reasonable costs incurred by PFG, pursuant to,
or in connection with, or relating to the Loan Documents (whether or not a lawsuit is filed), including, but not limited to, Professional
Costs PFG pays or incurs in order to do the following: (i) prepare and negotiate this Agreement and all present and future documents
relating to this Agreement or the other Loan Documents; (ii) obtain legal advice in connection with the Loan Documents or Obligor,
enforce or seek to enforce any of its rights or retain the services of consultants to do so; (iii) prosecute actions against,
or defend actions by, Account Debtors; (iv) commence, intervene in, or defend any action or proceeding; (v) initiate any complaint
to be relieved of the automatic stay in bankruptcy; (vi) file or prosecute any bankruptcy claim, third-party claim, or other claim;
(vii) examine, audit, copy, and inspect any of the Collateral or any of Obligor’s books and records, subject to Section
4.5; (viii) protect, obtain possession of, lease, dispose of, or otherwise enforce PFG’s security interest in, the Collateral;
and (ix) otherwise represent PFG in any litigation relating to Obligor.”

 

“Liquidation”
means, in respect of Australian Borrower or the Australian Parent: (a) a winding up, dissolution, liquidation, provisional liquidation,
administration, bankruptcy or other proceeding for which an External Administrator is appointed, or an analogous or equivalent
event or proceeding in any jurisdiction; or (b) an arrangement, moratorium, assignment or composition with or for the benefit
of creditors or any class or group of them.”

 

“
“Loan Documents” means, collectively, this Agreement, the Representations, the IPSA, the Australian Security
and Guarantee, and any and all other present and future documents, instruments and agreements between PFG and Borrower or Guarantor,
including, but not limited to those relating to this Agreement, and all amendments and modifications thereto and replacements
therefor.

 

    	 	8	 

     

    

 

“
“Obligor” means, collectively, Existing Borrower, New Borrower and Guarantor.”

 

“
“PPS Law” means:

 

(a)
the PPSA and any regulation made at any time under the PPSA, including the PPS Regulations (each as amended from time to time);
and

 

(b)
any amendment made at any time to any other legislation as a consequence of a law or regulation referred to in paragraph (a) of
this definition.”

 

“
“PPS Regulations” means the Personal Property Securities Regulations 2010 (Commonwealth of Australia).”

 

“
“PPSA” means the Personal Properties Securities Act 2009 (Commonwealth of Australia).”

 

“
“Responsible Officer(s)” means, with respect to Parent, Delaware Subsidiary and Vivo, Panna Sharma, John A.
Roberts and any other officer of Parent identified in writing by a Responsible Officer, and with respect of Australian Borrower
or the Australian Parent, the Australian equivalent of such officers.”

 

“
“Second Modification Effective Date” is June 30, 2018.”

 

“
“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 and, in relation to the Australian Borrower or the Australian
Parent, without limiting the foregoing, includes a subsidiary as defined in the Corporations Act including any entity controlled
by the Australian Borrower or the Australian Parent for the purposes of section 50AA of the Corporations Act. Unless the context
otherwise requires, each reference to a Subsidiary herein shall be a reference to a Subsidiary of Borrower or Guarantor.”

 

“
“Tax(es)” means any tax (including any income tax, franchise tax, capital gains tax, estimated tax, gross receipts
tax, value-added tax, surtax, excise tax, ad valorem tax, transfer tax, stamp tax, sales tax, use tax, property tax, business
tax, occupation tax, inventory tax, occupancy tax, withholding tax or payroll tax), levy, assessment, tariff, impost, imposition,
toll, duty (including any customs duty), deficiency or fee, and any related charge or amount (including any fine, penalty or interest),
that is, has been or may in the future be (a) imposed, assessed or collected by or under the authority of any Governmental Body,
or (b) payable pursuant to any tax-sharing agreement or similar contract, and, in addition to the foregoing, with respect to Australian
Borrower or the Australian Parent, includes stamp duty and GST (as defined in the A New Tax System (Goods and Services Tax) Act
1999 (Cth)).”

 

“
“US 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.”

 

“
“Vivo” means vivoPharm, LLC, a Delaware limited liability company and a Borrower hereunder.”

 

“
“Westpac Accounts” is defined in Section 8(b) of the Schedule.”

 

7.19
Section 8.12 (Time of Essence). The text “this Agreement” is deleted and replaced by the text “the Loan
Documents”.

 

7.20
Section 8.18 (Paragraph Headings; Construction; Counterparts). Section 8.18 is amended in its entirety and replaced
with the following:

 

    	 	9	 

     

    

 

“
8.18 Paragraph Headings; Construction; Counterparts. Paragraph headings are only used in this Agreement for convenience.
Borrower and PFG acknowledge that the headings may not describe completely the subject matter of the applicable paragraph, and
the headings shall not be used in any manner to construe, limit, define or interpret any term or provision of this Agreement.
This Agreement has been fully reviewed and negotiated between the parties with the benefit of independent counsel and no uncertainty
or ambiguity in any term or provision of this Agreement shall be construed strictly against PFG or Borrower under any rule of
construction or otherwise. References to “Borrower” are construed to mean “each Borrower”, unless otherwise
expressly specified. Amounts set off in brackets or parentheses are negative. The word “shall” is mandatory, the word
“may” is permissive, and the word “or” is not exclusive. The term “this Agreement” (i) includes
the Schedule and (if not otherwise specified) any amendment, modification, restatement or other writing amending the terms of
this Agreement, and (ii) as the context permits, shall be deemed and construed to include “and the other Loan Documents”.
Obligations of a similar nature addressed in different sections of this Agreement shall be deemed supplemental to one another
and not exclusive unless expressly set forth as such. Words and phrases expressing examples, including “for example”
and “such as” are non-exclusive. 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.”

 

7.21
Section 8.26 (Mutual Waiver of Jury Trial). The text amended by “this Agreement” in the third line is deleted
and replaced by the text “the Loan Documents”.

 

7.22
Section 5 of Schedule (Financial Covenants). Section 5 of the Schedule is amended in its entirety and replaced with the following:

 

 

“5.
Financial Covenants

 

	 	(Section
    4.1):	Borrower
    shall comply with each of the following covenants. Compliance shall be determined on a consolidated basis (except with respect
    to Minimum Liquidity) (with numbers in parentheses denoting negative numbers):
	 	 	 
	 	Minimum
    Adjusted	 
	 	EBITDA:	Tested
    calendar monthly on a trailing three-month (“T3M”) basis, Borrower shall maintain Adjusted EBITDA of not less
    than the amounts set forth below for the corresponding T3M periods:

 

	T3M Periods Ending 	 	Minimum Threshold	 
	 	 	 	 
	March 31, 2018	 	$	(3,300,000	)
	April 30, 2018	 	$	(2,850,000	)
	May 31, 2018	 	$	(2,500,000	)
	June 30, 2018	 	$	(2,000,000	)
	July 31, 2018	 	$	(1,800,000	)
	August 31, 2018	 	$	(1,650,000	)
	September 30, 2018	 	$	(1,500,000	)
	October 31, 2018	 	$	(750,000	)
	November 30, 2018	 	$	0.00	 
	December 31, 2018 and each period thereafter	 	$	750,000	 

 

	 	Minimum
    Revenues:	Tested
    on a quarterly basis as of the end of each calendar quarter during the term of the Loan, Borrower’s Revenues shall meet
    or exceed the thresholds set forth below for the corresponding periods:

 

    	 	10	 

     

    

 

	Quarterly Periods	 	Minimum Thresholds	 
	 	 	 	 
	March 31, 2018	 	$	6,300,000	 
	June 30, 2018	 	$	7,010,000	 
	September 30, 2018	 	$	7,042,000	 
	December 31, 2018	 	$	7,830,000	 

 

	 	Future
    Periods:	With
    respect to the period ending March 31, 2019 and each period thereafter, the levels of minimum Revenue shall be set by PFG
    in consultation with and generally consistent with SVB. With respect thereto:
	 	 	 
	 	 	(i)
    Borrower’s failure to either (1) agree in writing (which agreement shall be set forth in a written amendment to this
    Agreement) on or before February 15, 2019, to any such covenant levels with respect to Borrower’s fiscal year ending
    December 31, 2019, or (2) notwithstanding Section 7(g) of this Schedule, deliver to PFG, on or before the earlier to occur
    of (i) January 31, 2018 and (ii) three (3) Business Days after approval by the Board, Borrower’s budgets, sales projections,
    operating plans and other financial information of Borrower that PFG reasonably deems relevant, including, without limitation,
    Borrower’s Board-approved operating budgets, projections and plans, with respect to Borrower’s fiscal year ending
    December 31, 2018, shall result in an immediate Event of Default for which there shall be no grace or cure period; and
	 	 	 
	 	 	(ii)
    Borrower’s failure to either (1) agree in writing (which agreement shall be set forth in a written amendment to this
    Agreement) on or before February 15, 2019, to any such covenant levels with respect to Borrower’s fiscal year ending
    December 31, 2019, or (2) notwithstanding Section 6(g) of this Schedule, deliver to PFG, on or before the earlier to occur
    of (i) January 31, 2019 or (ii) three (3) Business Days after approval by the Board, Borrower’s budgets, sales projections,
    operating plans and other financial information of Borrower that PFG reasonably deems relevant, including, without limitation,
    Borrower’s Board-approved operating budgets, projections and plans, with respect to Borrower’s fiscal year ending
    December 31, 2019, shall result in an immediate Event of Default for which there shall be no grace or cure period.
	 	 	 
	 	Minimum
    Liquidity:	Tested
    monthly with respect to Borrower only, and not on a consolidated basis with any Non-Borrower Subsidiaries, Borrower shall
    at all times maintain Minimum Liquidity of at least $2,000,000.
	 	 	 
	 	Definitions:	For
    purposes of the foregoing financial covenants, the following terms shall have the following meanings:
	 	 	 
	 	 	“Adjusted
    EBITDA” means, calculated on a consolidated basis with respect to Parent and its Subsidiaries, (a) Net Income, plus
    (b) to the extent deducted in the calculation of Net Income, (i) Interest Expense, (ii) depreciation and amortization expense,
    (iii) income tax expense, (iv) and non-cash stock compensation expense, and (v) restructuring and severance costs not exceeding
    $200,000 in the aggregate in any fiscal year of Parent, minus (c) unfinanced capital expenditures, all as determined in accordance
    with GAAP.

 

    	 	11	 

     

    

 

	 	 	“Minimum
    Liquidity” means the sum of Cash and Cash Equivalents in Collateral Accounts with the Senior Lender, plus Availability.
    For purposes hereof, “Availability” means the unused amount that may be drawn by Borrower on any day under Parent’s
    revolving line of credit with the Senior Lender (which, for the avoidance of doubt, shall be net of then outstanding principal
    borrowings under such line of credit).”

 

7.23
Schedule Section 6 (Reporting). Section 6.2 is hereby amended by replacing clause (h) in its entirety with the following:

 

	 	 	“(h)	Copies
    of all reports and statements provided by Obligor to the Senior Lender, to the extent not duplicative of substantially identical
    reports otherwise provided to PFG under the Loan Documents.”

 

7.24
Schedule Section 8(b) (Collateral Accounts). Section 8(b) of the Schedule is amended in its entirety and replaced with the
following:

 

	“(b)	Collateral
    Accounts. Borrower shall cause the banks and other institutions where its, its Subsidiaries’ and Australian Parent’s
    Collateral Accounts are maintained to enter into Control Agreements with PFG, in form and substance legally sufficient and
    otherwise satisfactory to PFG in its good faith business judgment and sufficient to perfect PFG’s security interest
    in said Collateral Accounts, subject to the Lien of the Senior Lender; provided, however, (i) such obligations shall
    be qualified to the extent qualified under the Senior Loan Documents with respect to (i) lockbox accounts with JP Morgan Chase
    Bank, (ii) Regions Bank, (iii) certificates of deposit with JP Morgan Chase Bank, (iv) PNC Bank, (v) Westpac Banking Corporation
    (with respect to Australian Parent), (vi) Cambridge Mercantile (Australia) Pty. Ltd. (with respect to Australian Parent),
    and (ii) such Control Agreement requirement 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 PFG by
    Borrower as such. Said Control Agreements shall permit PFG, upon the occurrence and during the continuance of an Event of
    Default, to exercise exclusive control over said Collateral Accounts and proceeds thereof (subject to the rights of the Senior
    Lender).”

 

7.25
Exhibit C (Compliance Certificate). The Compliance Certificate is amended in its entirety and replaced with the Compliance
Certificate in the form attached hereto as Schedule 1.

 

8.
Limitation of Amendments.

 

8.1
The amendments set forth in Section 7 above are effective for the purposes set forth herein and shall be limited precisely
as written and shall not be deemed to (a) be a consent to any amendment, waiver or modification of any other term or condition
of any Loan Document, or (b) otherwise prejudice any right or remedy which PFG may now have or may have in the future under or
in connection with any Loan Document.

 

    	 	12	 

     

    

 

8.2
This Second Modification shall be construed in connection with and as part of the Loan Documents and all terms, conditions,
representations, warranties, covenants and agreements set forth in the Loan Documents, except as herein amended, are hereby ratified
and confirmed and shall remain in full force and effect.

 

9.
Representations and Warranties.
To induce PFG to enter into this Second Modification, Borrower hereby represents and warrants to PFG as follows:

 

9.1
Immediately after giving effect to this Second Modification (a) the representations and warranties contained in the Loan Documents
are true, accurate and complete in all material respects as of the date hereof (except to the extent such representations and
warranties relate to an earlier date, in which case they are true and correct as of such date), and (b) no Event of Default has
occurred and is continuing;

 

9.2
Borrower has the power and authority to execute and deliver this Second Modification and to perform its obligations under
the Loan Agreement, as amended by this Second Modification;

 

9.3
The organizational documents of Existing Borrower delivered to PFG on the Effective Date remain true, accurate and complete
and have not been amended, supplemented or restated and are and continue to be in full force and effect;

 

9.4
The execution and delivery by Borrower of this Second Modification and the performance by Borrower of its obligations under
the Loan Agreement, as amended by this Second Modification, have been duly authorized;

 

9.5
The execution and delivery by Borrower of this Second Modification and the performance by Borrower of its obligations under
the Loan Agreement, as amended by this Second Modification, do not and will not contravene (a) any law or regulation binding on
or affecting Borrower, (b) any contractual restriction with a Person binding on Borrower, (c) any order, judgment or decree of
any court or other governmental or public body or authority, or subdivision thereof, binding on Borrower, or (d) the organizational
documents of Borrower;

 

9.6
The execution and delivery by Borrower of this Second Modification and the performance by Borrower of its obligations under
the Loan Agreement, as amended by this Second Modification, do not require any order, consent, approval, license, authorization
or validation of, or filing, recording or registration with, or exemption by any governmental or public body or authority, or
subdivision thereof, binding on Borrower, except as already has been obtained or made; and

 

9.7
This Second Modification has been duly executed and delivered by Borrower and is the binding obligation of Borrower, enforceable
against Borrower in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization,
liquidation, moratorium or other similar laws of general application and equitable principles relating to or affecting creditors’
rights.

 

    	 	13	 

     

    

 

10.
Post-Second Modification Conditions.

 

(a)
Financing Condition. On or before (i) July 13, 2018, Borrower shall have provided true and correct copies of the fully-executed
agreements and/or instruments executed and delivered in connection with an equity or subordinated debt investor financing providing
in the aggregate not less than $2,500,000 in net new cash capital proceeds to Borrower (which, for the avoidance of doubt, is
exclusive of the proceeds from the sale of capital stock or assets of Bioserve Biotechnologies (India) Private Limited consummated
in April 2018, and (ii) July 16, 2018, Borrower shall have received the cash proceeds of the financing referred to in clause (i)
(the “Financing Condition”). For the avoidance of doubt, this Section 10(a) supersedes Section 8(a) of the
First Modification, which First Modification Section shall be of no further force and effect.

 

(b)
Modification Fee. Borrower shall have paid PFG a fee in consideration of this Second Modification and the First Modification
in the amount of $75,000, due and payable upon PFG invoice promptly following the Second Modification Effective Date. The foregoing
fee obligation supersedes the Modification Fee requirement set forth in Section 7(f) of the First Modification.

 

11.
Integration.
This Second Modification, the First Modification (to the extent not inconsistent with this Second Modification), the Loan Agreement
and the other Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements.
Except as aforesaid, all prior agreements, understandings, representations, warranties, and negotiations between the parties about
the subject matter of this Second Modification and the Loan Documents merge into this Second Modification and the Loan Documents.

 

12.
Counterparts.
This Second Modification may be executed in any number of counterparts and all of such counterparts taken together shall be deemed
to constitute one and the same instrument.

 

13.
Effectiveness.
This Second Modification shall be deemed effective upon (a) the due execution and delivery to PFG of this Second Modification
by each party hereto, and (b) Borrower’s payment to PFG of PFG’s legal fees and expenses incurred in connection with
this Second Modification.

 

[Signature
page follows]

 

    	 	14	 

     

    

 

In
Witness Whereof, this Second Modification
and all documents executed in connection therewith, or relating thereto, have been negotiated, prepared and deemed to be executed
by Borrower in the United States of America. In addition, the parties hereto have caused this Second Modification to be duly executed
and delivered as of the date first written above.

 

PFG

 

PARTNERS
FOR GROWTH IV, L.P.

 

	By	/s/
    Philip Lawson	 
	Name:	Philip
    Lawson	 
	Title:	Manager,
    Partners for Growth IV, LLC	 
	 	Its
    General Partner 	 

 

BORROWER

 

CANCER
GENETICS, INC.

 

	By:	/s/
    John A. Roberts	 
	Name:	John
    A. Roberts	 
	Title:	Chief
    Executive Officer	 

 

GENTRIS,
LLC

 

	By:	/s/
    John A. Roberts	 
	Name:	John
    A. Roberts	 
	Title:	Chief
    Executive Officer	 

 

VIVOPHARM,
LLC

 

	By:	/s/
    John A. Roberts	 
	Name:	John
    A. Roberts	 
	Title:	Chief
    Executive Officer	 

 

[Signature
page to Joinder and Modification No. 2 to

Amended
and Restated Loan and Security Agreement]

 

    	 	 	 

     

    

 

	Executed
    by RDDT A VIVOPHARM COMPANY PTY LTD in accordance with Section 127 of the Corporations Act 2001	 	 
	 	 	 
	/s/
    John A. Roberts	 	/s/
    Ralf Brandt
	Signature
    of director	 	Signature
                                         of director/company secretary

        

        (Please
        delete as applicable)

	 	 	 
	John
    A. Roberts	 	Ralf
    Brandt
	Name
    of director (print)	 	Name
    of director/company secretary (print)

 

[Signature
page to Joinder and Modification No. 2 to

Amended
and Restated Loan and Security Agreement]

 

    	 	 	 

     

    

 

Compliance
Certificate

 

Schedule
1

 

COMPLIANCE
CERTIFICATE

 

 

 

	Borrower:
                                         Cancer Genetics, Inc. / vivoPharm, LLC /

        
	 	Lender:
                                         Partners for Growth IV, L.P. (“PFG”)

	Gentris,
    LLC, c/o 201 Route 17 N. 2nd Floor, Rutherford, NJ 07070	 	1660
    Tiburon Blvd., Suite D Tiburon, CA 94920

 

The
undersigned authorized officer of Borrower hereby certifies that in accordance with the terms and conditions of the Loan and Security
Agreement between Borrower and PFG dated as of March 22, 2017, as amended (the “Agreement”), (i) Borrower (on a consolidated
basis) is in complete compliance for the period ending __________________ with all required covenants except as detailed
below, (ii) all representations and warranties of Borrower stated in the Agreement, including the Representation Letter, as defined
in the Agreement, are true, complete, correct and accurate on this date except those representations and warranties expressly
referring to a specific date shall be true, complete, correct and accurate as of such date, and except as noted below or on any
disclosure letter attached to this Certificate as Exhibit A, (iii) each Borrower and each of its Subsidiaries has timely
filed all required tax returns and reports, and each Borrower has timely paid all foreign, federal state and local taxes, assessments,
deposits and contributions owed by Borrower(s) except as otherwise permitted pursuant to the Loan Agreement, (iv) no Liens have
been levied or claims made against any Borrower or any of its Subsidiaries relating to unpaid employee payroll or benefits of
which such Borrower has not previously provided written notification to PFG, and (v) there are no Defaults or Events of Default.
Attached herewith are the required documents supporting the above certification. The undersigned further certifies that the financial
statements, information and schedules referred to below have been prepared in accordance with Generally Accepted Accounting Principles
(GAAP) and are consistent from one period to the next except as explained in an accompanying letter or footnotes.

 

Please
indicate compliance status by circling Yes/No under “Complies” column.

 

	Reporting
    Covenants	 	Required	 	Complies
	 	 	 	 	 	 
	Compliance
    Certificates	 	Monthly
    within 30 Days	 	Yes	No
	Unaudited
    Financial Statements	 	Monthly
    within 30 Days	 	Yes	No
	AR
    and AP Agings 	 	Monthly
    within 30 Days	 	Yes	No
	Operating
    Budgets/Projections	 	As
    soon as available / 60 days of FYE	 	Yes	No
	Audited
    Financial Statements	 	Earlier
    - 150 Days of FYE / 5 days of SEC filing)	 	Yes	No
	SEC
    Filings	 	Within
    5 days	 	Yes	No
	Copies
    of SVB Reports	 	Upon
    request	 	Yes	No
	Statements,
    Etc.to stockholders	 	5
    Business Days	 	Yes	No
	Other
    Reports	 	Promptly
    following PFG request	 	Yes	No
	Representations
    Letter Update	 	When
    Required1 or each Q-End	 	Yes	No
	Advance
    Notice of Board Meeting	 	LSA
    Section 4.5 – ongoing obligation	 	Yes	No

 

	Financial
Covenants2	 	Required	 	Actual	 	Complies
	 	 	 	 	 	 	 	 
	Min Liquidity	 	> $2,000,000	 	 	 	 	 
	Min Adjusted EBITDA	 	 	 	 	 	 	 
	Min Revenues	 	 	 	 	 	 	 

 

 

	SIGNATURE	 

 

 

	NAME
    / TITLE	 	DATE

 

 

 

[1] To be updated as and when necessary to keep
the information current, accurate and complete.

[2] See Exhibit B, page 3

 

[Signature
page to Joinder and Modification No. 2 to

Amended
and Restated Loan and Security Agreement]

 

    	 	 	 

     

    

 

Compliance
Certificate – Exhibit A Disclosure Schedule

 

Financial
Covenants (Section 5 of Schedule to Loan and Security Agreement)

 

	“5. Financial
    Covenants
	 	 	 
	(Section 4.1):	 	Borrower shall comply
    with each of the following covenants. Compliance shall be determined on a consolidated basis (except with respect to Minimum
    Liquidity) (with numbers in parentheses denoting negative numbers):
	 	 	 
	Minimum Adjusted	 	 
	EBITDA:	 	Tested calendar
    monthly on a trailing three-month (“T3M”) basis, Borrower shall maintain Adjusted EBITDA of not less than the
    amounts set forth below for the corresponding T3M periods:

 

	T3M Periods Ending 	 	Minimum Threshold	 
	 	 	 	 	 
	March 31, 2018	 	$	(3,300,000	)
	April 30, 2018	 	$	(2,850,000	)
	May 31, 2018	 	$	(2,500,000	)
	June 30, 2018	 	$	(2,000,000	)
	July 31, 2018	 	$	(1,800,000	)
	August 31, 2018	 	$	(1,650,000	)
	September 30, 2018	 	$	(1,500,000	)
	October 31, 2018	 	$	(750,000	)
	November 30, 2018	 	$	0.00	 
	December 31, 2018 and each period thereafter	 	$	750,000	 

 

	Minimum
    Revenues:	 	Tested
    on a quarterly basis as of the end of each calendar quarter during the term of the Loan, Borrower’s Revenues shall meet
    or exceed the thresholds set forth below for the corresponding periods:

 

	Quarterly Periods 	 	Minimum Thresholds	 
	 	 	 	 
	March 31, 2018	 	$	6,300,000	 
	June 30, 2018	 	$	7,010,000	 
	September 30, 2018	 	$	7,042,000	 
	December 31, 2018	 	$	7,830,000	 

 

    	 	 	 

     

    

 

Compliance
Certificate – Exhibit A Disclosure Schedule

 

	Future
    Periods:	 	With
    respect to the period ending March 31, 2019 and each period thereafter, the levels of minimum Revenue shall be set by PFG
    in consultation with and generally consistent with SVB. With respect thereto:

 

		(i)	Borrower’s
                                         failure to either (1) agree in writing (which agreement shall be set forth in a written
                                         amendment to this Agreement) on or before February 15, 2019, to any such covenant levels
                                         with respect to Borrower’s fiscal year ending December 31, 2019, or (2) notwithstanding
                                         Section 7(g) of this Schedule, deliver to PFG, on or before the earlier to occur of (i)
                                         January 31, 2018 and (ii) three (3) Business Days after approval by the Board, Borrower’s
                                         budgets, sales projections, operating plans and other financial information of Borrower
                                         that PFG reasonably deems relevant, including, without limitation, Borrower’s Board-approved
                                         operating budgets, projections and plans, with respect to Borrower’s fiscal year
                                         ending December 31, 2018, shall result in an immediate Event of Default for which there
                                         shall be no grace or cure period; and

 

		(ii)	Borrower’s
                                         failure to either (1) agree in writing (which agreement shall be set forth in a written
                                         amendment to this Agreement) on or before February 15, 2019, to any such covenant levels
                                         with respect to Borrower’s fiscal year ending December 31, 2019, or (2) notwithstanding
                                         Section 6(g) of this Schedule, deliver to PFG, on or before the earlier to occur of (i)
                                         January 31, 2019 or (ii) three (3) Business Days after approval by the Board, Borrower’s
                                         budgets, sales projections, operating plans and other financial information of Borrower
                                         that PFG reasonably deems relevant, including, without limitation, Borrower’s Board-approved
                                         operating budgets, projections and plans, with respect to Borrower’s fiscal year
                                         ending December 31, 2019, shall result in an immediate Event of Default for which there
                                         shall be no grace or cure period.

 

	Minimum Liquidity:	 	Tested monthly with respect
    to Borrower only, and not on a consolidated basis with any Non-Borrower Subsidiaries, Borrower shall at all times maintain
    Minimum Liquidity of at least $2,000,000.
	 	 	 
	Definitions:	 	For purposes of the foregoing financial covenants,
    the following terms shall have the following meanings:
	 	 	 
	 	 	“Adjusted EBITDA” means,
    calculated on a consolidated basis with respect to Parent and its Subsidiaries, (a) Net Income, plus (b) to the extent deducted
    in the calculation of Net Income, (i) Interest Expense, (ii) depreciation and amortization expense, (iii) income tax expense,
    (iv) and non-cash stock compensation expense, and (v) restructuring and severance costs not exceeding $200,000 in the aggregate
    in any fiscal year of Parent, minus (c) unfinanced capital expenditures, all as determined in accordance with GAAP.
	 	 	 
		 	“Minimum Liquidity”
    means the sum of Cash and Cash Equivalents in Collateral Accounts with the Senior Lender, plus Availability. For purposes
    hereof, “Availability” means the unused amount that may be drawn by Borrower on any day under Parent’s revolving
    line of credit with the Senior Lender (which, for the avoidance of doubt, shall be net of then outstanding principal borrowings
    under such line of credit).”Exhibit 10.1

 

FLEXSTEEL
INDUSTRIES, INC.

RESTRICTED
STOCK UNIT NOTIFICATION OF AWARD 

FOR
________________

 

This
Restricted Stock Unit Award (“Award”) is effective as of the ___ day of _____ (the “Grant Date”) between
FLEXSTEEL INDUSTRIES, INC., a Minnesota Corporation (the “Company”) and _____________, an employee of the Company
(“Employee”). The Company desires to provide the Employee with a long-term incentive to continue the Employee’s
services to the Company, and to increase his participation in the success of the Company. This Award is granted under the terms
of the Company’s 2013 Omnibus Stock Plan (the “Plan”). (See Attachment A, the “Plan”.)

 

Therefore,
the Award is as follows:

 

		1.	Issuance
                                         of Restricted Stock Units. Subject to the terms and conditions set forth below in
                                         this Notification of Award, the Company grants to the Employee _______ RSUs equal to
                                         ($_________) _____________ Dollars with the number of Restricted Stock Units (“RSUs”)
                                         to be awarded based upon the average of the previous 10 trading days closing stock price
                                         to the Grant Date. The number of RSUs shall vest as enumerated in Section 2, and shall
                                         be paid as provided in Section 6.

 

		2.	Vesting.
                                         Except as otherwise provided in this Section, the Employee’s rights in and to the
                                         RSUs shall become vested upon the earliest of the following dates or events to occur:

		a.	On
                                         _______ shall vest, if the Employee is employed and in good standing with the Company
                                         on that date;

		b.	On
                                         the date of the Employee’s death while employed with the Company;

		c.	On
                                         the date the Employee is determined to be disabled under the Company’s long-term
                                         disability plan for entitlement to benefits thereunder;

		d.	On
                                         the date of a Change in Control of the Company (as defined in Section 3 below), if the
                                         Employee is employed and in good standing with the Company on that date; or

 

If
the employment of the Employee shall terminate for any reason prior to the earliest date or event provided in subsection a. through
f. above, all RSUs shall be forfeited to the Company, without payment to the Employee therefor. Notwithstanding any earlier vesting
as provided above, the Employee shall have no rights in or to the RSUs or payment under this Notification of Award if the Employee
is terminated for Cause (as defined in Section 4 below).

 

		3.	Change
                                         in Control. Change in Control means any of the following:

		a.	Any
                                         individual, entity or group becomes a “Beneficial Owner” (as defined in Rule
                                         13d-3 of the Exchange Act), directly or indirectly, of at least twenty percent (20%)
                                         but less than fifty percent (50%) of the voting stock of the Company in a transaction
                                         that is not previously approved by the Board of Directors of the Company;

		b.	Any
                                         individual, entity or group becomes a Beneficial Owner, directly or indirectly, of at
                                         least fifty percent (50%) of the voting stock of the Company;

		c.	The
                                         persons who were directors of the Company immediately prior to any contested election
                                         or series of contested elections, tender offer, exchange offer, merger, consolidation,
                                         other business combination, or any combination of the foregoing cease to constitute a
                                         majority of the members of the Board of Directors of the Company immediately following
                                         such occurrence;

 

    	1 

     

    

 

		d.	Any
                                         merger, consolidation, reorganization or other business combination where the individuals
                                         or entities who constituted the Company’s shareholders immediately prior to the
                                         combination will not immediately after the combination own at least fifty percent (50%)
                                         of the voting securities of the business resulting from the combination;

		e.	The
                                         sale, lease, exchange, or other transfer of all or substantially all the assets of the
                                         Company to any individual, entity or group not affiliated with the Company;

		f.	The
                                         liquidation or dissolution of the Company; or

		g.	The
                                         occurrence of any other event by which the Company no longer operates as an independent
                                         public company.

 

		4.	Cause.
                                         “Cause” means:

		a.	The
                                         willful and continued failure of the Employee to perform substantially the Employee’s
                                         duties as established from time to time by the Company’s management (other than
                                         any such failure resulting from a disability), after a written demand for substantial
                                         performance is delivered to the Employee by the Company’s management that specifically
                                         identifies the manner in which the management believes that the Employee has not substantially
                                         performed the Employee’s duties; or

		b.	The
                                         willful engaging by the Employee in illegal conduct or misconduct as described in the
                                         Flexsteel Industries, Inc. Employee Handbook, as amended from time to time, or gross
                                         misconduct that is materially and demonstrably injurious to the Company as determined
                                         by the Company to constitute conduct that warrants forfeiture pursuant to the Plan and
                                         this Notification of Award.

 

For
purposes of this definition, no act, or failure to act, on the part of the Employee shall be considered “willful”
unless it is done, or omitted to be done, by the Employee in bad faith or without reasonable belief that the Employee’s
action or omission was in the best interests of the Company. Any act, failure to act, based on (i) authority given pursuant to
resolution duly adopted by the Board, or (ii) the advice of counsel for the Company shall be conclusively presumed to be done
or omitted to be done, by the Employee in good faith and in the best interests of the Company.

 

		5.	Dividend
                                         Equivalents on RSUs. During the period prior to vesting (as defined in Section 2
                                         above), Dividend Equivalents will be credited quarterly as cash, accumulating until vesting
                                         and payout at the same time as the underlying RSU award. Any credited Dividend Equivalents
                                         shall thereafter be subject to the terms of this Notification of Award to the same extent
                                         as the RSUs giving rise to the Dividend Equivalents. Dividend Equivalents shall otherwise
                                         be considered a part of the award of Restricted Stock Units.

 

		6.	Payment
                                         of RSUs. Except as provided in the next sentence, the Company shall pay to the Employee
                                         the value as determined in this Section 6 of the RSUs credited to the Employee under
                                         this Award within fifteen (15) days after the vesting date (as defined in Section 2 above).
                                         The amount to be paid shall be the number of whole RSUs credited to the Employee under
                                         this Agreement converted to shares and Dividend Equivalents shall be paid in cash.

 

		7.	Changes
                                         in Capital Structure of the Company. The number of RSUs held by the Employee for
                                         which payment pursuant to Section 6 has not been made shall be adjusted equitably by
                                         the Company in the event of (i) a subdivision or combination of the shares of capital
                                         stock of the Company, (ii) a dividend payable in shares of capital stock of the Company
                                         (iii) a reclassification of any shares of capital stock of the Company or (iv) any other
                                         change in capital structure of the Company. Such adjustment shall be made as if each
                                         RSU represented an issued and outstanding share of Common Stock of the Company as of
                                         the date of such adjustment. Any additional RSUs credited to the Employee as a result
                                         of any of the foregoing events shall continue to be subject to the terms of this Notification
                                         of Award to the same extent as the RSUs giving rise to the right to receive such additional
                                         RSUs.

 

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		8.	Withholding.
                                         The Company has the right to deduct and withhold any taxes due as a result of this Award.
                                         The Company may, in its discretion, elect to withhold cash from other compensation payable
                                         to the Employee by the Company or withhold shares otherwise payable to you under this
                                         Notification of Award to satisfy applicable federal, state, and local withholding tax
                                         requirements with respect to the RSUs and Dividend Equivalents. The Employee agrees to
                                         pay to the Company, when due, any amount necessary to satisfy applicable federal, state,
                                         and local withholding tax requirements with respect to the RSUs and Dividend Equivalents.
                                         The Company will process payment of the amount determined under Section 6 through the
                                         Employee’s payroll along with applicable withholding taxes.

 

		9.	Forfeiture
                                         and Clawback. Forfeiture and Clawback provisions as provided for in the Plan apply
                                         to this Award. See the Plan document and Attachment B “Competitive Activity”
                                         and “Improper Use of Confidential Information” definitions to this Notification
                                         of Award for more details.

 

		10.	Employment
                                         of Employee. Nothing in this Notification of Award shall be construed as constituting
                                         a commitment, guaranty, agreement or understanding of any kind or nature that the Company
                                         shall continue to employ the Employee, and this Notification of Award shall not affect
                                         in any way the right of the Company or its subsidiaries to terminate the employment of
                                         the Employee at any time for any reason. The Company shall have the right to reduce or
                                         recoup amounts due under the Notification of Award, but only to the extent such reduction
                                         or recoupment is specifically required by any federal or Minnesota law or regulation
                                         with respect to amounts due under this Notification of Award.

 

		11.	General
                                         Creditor. The RSUs represent an unfunded promise to pay cash or cash equivalents
                                         in the future and the Employee shall not have any rights other than as a general creditor
                                         of the Company with respect to the payment of the value of the RSUs as provided in this
                                         Agreement. The Employee shall not sell, transfer, pledge, assign or otherwise encumber
                                         any of the RSUs, whether voluntarily, involuntarily or by operation of law. Any purported
                                         transfer, pledge or encumbrance of such RSUs shall be void and unenforceable against
                                         the Company, and no purported transferee shall acquire any right or interest with respect
                                         to the RSUs or the payment therefor as a result.

 

		12.	Rights
                                         of Stockholder. The Employee shall not have any rights of a stockholder of the Company
                                         with respect to the RSUs, including the right to vote.

 

		13.	Governing
                                         Law. This Agreement shall be construed and enforced in accordance with the laws of
                                         the State of Minnesota, without regard to the principles of rules of any jurisdiction
                                         with respect to conflict of laws.

 

		14.	Incorporation
                                         of Plan. Except to the extent specifically provided in this Notification of Award,
                                         this grant shall be subject to and governed by the terms and conditions of the Plan,
                                         which shall be incorporated as though fully set forth herein. Capitalized terms not otherwise
                                         defined in this Notification of Award shall have the meaning set forth in the Plan.

 

    	3 

     

    

 

		15.	Entire
                                         Notification of Award; Modification. This Notification of Award sets forth all of
                                         the promises, conditions, understandings, warranties and representations between the
                                         parties with respect to the RSUs, and there are no promises, agreements, conditions,
                                         understandings, warranties or representations, oral or written, express or implied, between
                                         the parties with respect to the RSUs other than as set forth in this Notification of
                                         Award, the Plan and referenced and related attachments to the Plan. This Notification
                                         of Award is, and is intended by the parties to be, an integration of any and all prior
                                         agreements or understandings, oral or written, with respect to the RSUs. Except as provided
                                         in Section 14, any change in, or modification of, this Agreement shall be valid only
                                         if in writing and signed by the parties to this Agreement.

 

		16.	Notices.
                                         Any and all notices provided for in this Notification of Award shall be addressed: (i)
                                         if to the Company, to the principal executive office of the Company to the attention
                                         of Secretary, and (ii) if to the Employee, to the address of the Employee as reflected
                                         in the records of the Company.

 

		17.	Invalid
                                         or Unenforceable Provisions. The invalidity or unenforceability of any particular
                                         provisions of this Notification of Award shall not affect the other provisions, and this
                                         Notification of Award shall be construed in all respects as if that invalid or unenforceable
                                         provision were omitted.

 

		18.	Acknowledgment.
                                         Your receipt of this Notification of Award, the Plan documents and related attachments
                                         as referenced in the Plan, including the Guidelines for Stock Ownership, constitutes
                                         your agreement to be bound by the terms and conditions of this Notification of Award
                                         and the Plan.

 

IN
WITNESS WHEREOF, the Company and the Employee have executed this Notification of Award to be effective as of the Grant Date.

 

 

 

	Accepted and Confirmed:	 	FLEXSTEEL INDUSTRIES, INC.
	 	 	 
	 	 	 	By	 
	Participant	Date	 		Date
	 	 	 	 	 
	 	 	 	 	 

 

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