Document:

Exhibit
10.4

 

INCENTIVE
STOCK OPTION AGREEMENT

UNDER
THE AMENDED AND RESTATED

2004
STOCK AWARD AND INCENTIVE PLAN

 

This
INCENTIVE STOCK OPTION AGREEMENT (this “Agreement”) is made between Interpace
Diagnostics Group, Inc., a Delaware corporation formerly known as PDI, Inc. (the “Company”), and First
Name Last Name (the “Participant”).

 

WHEREAS,
the Company maintains the PDI, Inc. Amended and Restated 2004 Stock Award and Incentive Plan (the “Plan”) for
the benefit of its employees, non-employee directors, and other persons who provide substantial services to the Company or its
subsidiaries or affiliates; and

 

WHEREAS,
the Plan permits the award of Incentive Stock Options to purchase shares of the Company’s Stock, subject to the terms of
the Plan; and

 

WHEREAS,
the Company wishes to award the Participant an option to purchase Number of Shares shares of the Company’s Stock,
subject to the restrictions and on the terms and conditions contained in the Plan and this Agreement.

 

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

 

1.
Award of Option. This Agreement evidences the grant to the Participant of an option (the “Option”) to
purchase Number of Shares shares of the Company’s Stock (the “Option Shares”), and the Participant
was notified of this grant by letter dated on or about the Effective Date (as defined below). The Option is subject to the terms
set forth herein, and in all respects is subject to the terms and provisions of the Plan, which terms and provisions are incorporated
herein by this reference. Except as otherwise specified herein or unless the context herein requires otherwise, the terms defined
in the Plan will have the same meanings herein.

 

2.
Nature of the Option. The Option is intended to be an incentive stock option as described by Section 422 of the Internal
Revenue Code of 1986, as amended (the “Code”).

 

3.
Date of Grant; Term of Option. The Option was granted on Grant Date (the “Effective Date”) and
may not be exercised later than the tenth anniversary of the Effective Date, subject to earlier termination in accordance with
the Plan.

 

4.
Option Exercise Price. The per share exercise price of the Option is $Grant Price (the “Exercise Price”),
which was the closing price of the Company’s Stock on the Effective Date.

 

    	 	 

    	 

    

 

5.
Vesting and Exercise of Option. The Option will become exercisable only in accordance with the terms and provisions of
the Plan and this Agreement, as follows:

 

	Vesting
    Date	 	Cumulative
    Percentage Vested
	First
        Anniversary of Grant Date

        Second
        Anniversary of Grant Date

        Third
        Anniversary of Grant Date
	 	33%

        66%

        100%

 

(a)
Accelerated Vesting. Subject to the Participant’s continued service with the Company, any unvested portion of the
Option shall become 100% fully vested and exercisable upon the occurrence of a Change in Control.

 

(b)
Method of Exercise. The Participant may exercise the Option by providing notice to the Company stating the election to
exercise the Option and such other requirements as are set forth in Section 6 of the Plan.

 

(c)
Partial Exercise. The Option may be exercised in whole or in part; provided, however, that any exercise may
apply only with respect to a whole number of Option Shares.

 

(d)
Restrictions on Exercise. The Option may not be exercised, and any purported exercise will be void, if the issuance of
the Option Shares upon such exercise would constitute a violation of any law, regulation or exchange listing requirement. As a
further condition to the exercise of the Option, the Company may require the Participant to make any representation or warranty
as may be required by or advisable under any applicable law or regulation.

 

6.
Termination of Service. If the Participant’s service terminates or is terminated for any reason prior to any applicable
vesting date as provided in Section 5, the Participant shall retain the right to exercise any vested portion of the Option until
the earlier to occur of ninety (90) days after the date of such termination of employment, provided that if the Participant’s
employment terminates as a result of death, the representative of the Participant’s estate shall have one (1) year after
the date of such termination of employment to exercise the Participant’s vested portion of the Option. To the extent that
the Option is not exercisable at the time of such termination, or to the extent the Option is not exercised within the time specified
herein, the Option shall terminate with no further compensation due to the Participant.

 

7.
Non-Transferability of Option. The Option 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 or distribution.
During the Participant’s lifetime, the Option is exercisable only by the Participant. Subject to the foregoing and the terms
of the Plan, the terms of the Option will be binding upon the executors, administrators and heirs of the Participant.

 

8.
Tax Consequences. The Company does not represent or warrant that this Option (or the purchase or sale of the Option Shares
subject hereto) will be subject to particular tax treatment. The Participant acknowledges that he has reviewed with his own tax
advisors the tax treatment of this Option (including the purchase and sale of any Option Shares acquired subject hereto) and is
relying solely on those advisors in that regard. The Participant understands that he (and not the Company) will be responsible
for his own tax liabilities arising in connection with this Option. The Company shall withhold taxes according to the requirements
under the applicable laws, rules, and regulations, including withholding taxes at source.

 

    	 	-2-	 

    	 

    

 

9.
No Rights as Stockholder. The Participant shall not have any rights and privileges of a stockholder of the Company with
respect to the Option, nor shall the Company have any obligation to issue any dividends or otherwise afford any rights to which
shares of Stock are entitled with respect to the Option.

 

10.
Early Disposition of Stock. Subject to the fulfillment by the Participant of any conditions
limiting the disposition of the Option Shares, the Participant agrees that if the Participant disposes of any Option Shares before
the later of (i) the first anniversary of the date on which the Option Shares are transferred to the Participant and (ii) the
second anniversary of the Effective Date, then the Participant will notify the Company in writing within 30 days after the date
of such disposition.

 

11.
The Plan. The Participant has received a copy of the Plan, has read the Plan and is familiar with its terms, and hereby
accepts the Option subject to the terms and provisions of the Plan, as amended from time to time. 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 Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee with
respect to questions arising under the Plan or this Agreement.

 

12.
Entire Agreement. This Agreement, together with the Plan, represents the entire agreement between the parties with respect
to the subject matter hereof and supersedes any prior agreement, written or otherwise, relating to the subject matter hereof.

 

13.
Continuation of Employment or Service. Nothing in the Plan or this Agreement shall be construed as imposing any obligation
on the Company to continue the Participant’s employment or service and nothing in the Plan or this Agreement shall confer
upon the Participant any right to continue in the employ or service of the Company or restrict the right of the Company to terminate
such employment or service at any time.

 

14.
Amendment. Except as otherwise provided herein or as would otherwise not have a material adverse effect on the Participant,
this Agreement may only be amended by a writing signed by each of the parties hereto.

 

15.
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.

 

16.
Execution. This Agreement may be executed, including execution by facsimile signature, in one or more counterparts, each
of which will be deemed an original, and all of which together shall be deemed to be one and the same instrument.

 

[This
space intentionally left blank; signature page follows]

 

    	 	-3-	 

    	 

    

 

IN
WITNESS WHEREOF, this Agreement has been executed by each party on the date indicated below, respectively.

 

	 	Interpace
    Diagnostics Group, Inc.
	 	 
	 	 
	 	Jack Stover
	 	CEO
	 	 
	 	PARTICIPANT
	 	 
	 	First Name Last
    Name
	 	 
	 	 
	 	Signatureinve-ex104_224.htm

 

Exhibit 10.4

FOURTH AMENDMENT 

TO

LOAN AND SECURITY AGREEMENT 

This Fourth Amendment to Loan and Security Agreement is entered into as of February _5_, 2018 (the “Amendment”), by and between EAST WEST BANK (“Bank”) and IDENTIV, INC. (“Parent” or “Borrower”).

RECITALS

Parent and Bank are parties to that certain Loan and Security Agreement dated as of February 8, 2017, as amended from time to time, including pursuant to that certain First Amendment to Loan and Security Agreement dated as of March 27, 2017, that certain Second Amendment to Loan and Security Agreement dated as of December 19, 2017 and that certain Third Amendment to Loan and Security Agreement dated as of January 30, 2018 (collectively, the “Loan Agreement”).  The parties desire to amend the Loan Agreement in accordance with the terms of this Amendment.  

NOW, THEREFORE, the parties agree as follows:

1.Parent intends to acquire all of the equity interests of 3VR Security, Inc., a California corporation (“Target”) in exchange for cash consideration and new subordinated unsecured promissory notes in an aggregate principal amount of $2,000,000 (the “Parent Notes”), and Bank hereby consents to such acquisition and the issuance of the Parent Notes and agrees that the Parent Notes constitute “Permitted Indebtedness” under the Loan Agreement, provided that Target becomes a borrower under the Loan Agreement and other Loan Documents in accordance with the terms set forth herein, and subject to the timely satisfaction of the following terms and conditions, in form and substance satisfactory to Bank: (a) within one Business Day following the 3VR Closing Date (defined below), Parent (i) delivers to Bank the fully executed copy of the acquisition documents, together with all schedules and exhibits; (ii) causes Target to execute and deliver to Bank a joinder agreement in substantially similar form as Appendix I attached hereto, an intellectual property security agreement, a corporate resolutions and incumbency certificate (including Target’s then-current articles of incorporation and bylaws), and such other documents, agreements and instruments as Bank may reasonably request, in connection with joining Target as a Borrower under the Loan Documents; and (iii) provides Bank with evidence, in form and substance satisfactory to Bank, that any Liens on Target or its property (other than Permitted Liens) have been terminated, and (b) Parent causes the holders of the Parent Notes to execute and deliver a subordination agreement in favor of Bank in form and substance satisfactory to Bank within ten Business Days following the 3VR Closing Date (defined below). For the sake of clarity, failure to timely comply with any of the foregoing shall constitute an Event of Default for which no cure period shall automatically apply.

2.Bank consents to the existing Indebtedness currently owing by Target owing to Opus Bank that will remain outstanding following the 3VR Closing Date and the Lien on Target’s assets in favor of Opus Bank securing such Indebtedness, and such Indebtedness constitutes “Permitted Indebtedness” under the Loan Agreement and such Lien constitutes a “Permitted Lien” under the Loan Agreement, provided that (x) Parent does not assume or otherwise become liable for any obligations (contingent or otherwise) with respect to such Indebtedness owing by Target, (y) the consummation of Parent’s acquisition of Target does not constitute an event of default under the loan documents with Target’s loan documents with Opus Bank and (z) such Indebtedness is repaid in full and such Lien is terminated (and Bank receives evidence satisfactory to Bank of such repayment and termination) within five (5) Business Days of the 3VR Closing Date. 

3.Borrower acknowledges and agrees that no Accounts or Inventory of Target shall be included in the Borrowing Base until after (i) the completion of an audit of Target’s Collateral, the results of which shall be satisfactory to Bank and (ii) Bank has received evidence of the termination of all Liens in favor of Opus Bank (including the termination of all UCC Financing Statements). 

1

 

4.The following definitions are added to Section 1.1 of the Loan Agreement:

“3VR Closing Date” means the closing of Parent’s acquisition of the capital stock of Target. 

“Target” means 3VR Security, Inc., a California corporation.

5.Section 6.8 of the Loan Agreement is amended by the phrase “at least eighty five percent (85%) of Borrowers’ total aggregate domestic cash” replacing the phrase “at least eighty five percent (85%) of Borrowers’ total domestic cash” therein.

6.Section 6.12 of the Loan Agreement is amended and restated in its entirety to read as follows:

6.12Post-Acquisition Covenants.  Borrowers shall deliver to Bank the following, each in form and substance satisfactory to Bank: (a) within thirty (30) days following the 3VR Closing Date, (i) a landlord consent with respect to Target’s leased location(s); (ii) Target’s year-to-date financial statements as of December 31, 2017, along with aged listings of Target’s accounts receivable an accounts payable and an inventory report; and (iii) insurance certificates and endorsements evidencing the addition of Bank as an additional insured and lose payee under Target’s insurance policies; (b) within forty-five (45) days following the 3VR Closing Date, account control agreements with respect to Target’s bank accounts maintained outside of Bank; and (c) within ten Business Days following the 3VR Closing Date, a fully executed subordination agreement in favor of Bank with respect to the promissory notes issued by Parent (the “Seller Notes”).

7.The following is added as a new Section 7.12 to the end of Section 7 of the Loan Agreement:

7.12 Seller Notes. Borrower shall not make any payment on account of the Seller Notes unless (i) such payments are made by Borrower from cash proceeds received by Borrower from the sale and issuance of its equity securities on and after December 2017, (ii) no Event of Default has occurred that is continuing or would exist immediately after giving effect to such payment, and (iii) Borrower provides Bank with prior written notice of such payments being made and along evidence satisfactory to Bank of Borrower’s compliance with the foregoing clause (i).

8.Unless otherwise defined, all initially capitalized terms in this Amendment shall be as defined in the Agreement.  The Agreement, as amended hereby, shall be and remain in full force and effect in accordance with its respective terms and hereby is ratified and confirmed in all respects.  Except as expressly set forth herein, the execution, delivery, and performance of this Amendment shall not operate as a waiver of, or as an amendment of, any right, power, or remedy of Bank under the Agreement, as in effect prior to the date hereof.  Each Borrower ratifies and reaffirms the continuing effectiveness of all agreements entered into in connection with the Agreement.

9.Each Borrower represents and warrants that the representations and warranties contained in the Agreement are true and correct as of the date of this Amendment, and that no Event of Default has occurred and is continuing.

10.This Amendment may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one instrument. In the event that any signature is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original hereof.  Notwithstanding the foregoing, Borrowers shall deliver all original signed documents requested by Bank no later than five (5) Business Days following the date of execution.

2

 

11.As a condition to the effectiveness of this Amendment, Bank shall have received, in form and substance satisfactory to Bank, the following:

(a)this Amendment, duly executed by Parent;

(b)amendment to intercreditor agreement with Venture Lending & Leasing VII, Inc. and Venture Lending & Leasing VIII, Inc.;

(c)payment of all Bank Expenses incurred through the date of this Amendment; and

(d)such other documents, and completion of such other matters, as Bank may reasonably deem necessary or appropriate.

[remainder of this page intentionally left blank]

3

 

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first date above written.

 

	
IDENTIV, INC.

	
 
	
 
	
 

	
By:
	
 
	
/s/ Sandra Wallach

	
Name:
	
 
	
Sandra Wallach

	
Title:
	
 
	
CFO

	
 
	
 
	
 

	
EAST WEST BANK

	
 
	
 
	
 

	
By:
	
 
	
/s/ Kelvin Chan

	
Name:
	
 
	
Kelvin Chan

	
Title:
	
 
	
Managing Director

 

 

 

4

 

APPENDIX I

 

JOINDER AGREEMENT

 

This Joinder Agreement (the “Joinder”) is entered into as of February __, 2018 by and among 3VR Security, Inc. (“Target”), Identiv, Inc. (“Parent”) and East West Bank (“Bank”).

 

RECITALS

 

Parent and Bank are parties to that certain Loan and Security Agreement dated as of February 8, 2017, as amended from time to time (the “Loan Agreement”).  By execution below, the parties desire to join Target as a borrower under the Loan Agreement in accordance with the terms set forth in this Joinder.

  

AGREEMENT

 

1.ADDITION OF CO-BORROWER. Target is hereby added to the Loan Agreement as a “Borrower” thereunder, and each reference to “Borrower” in the Loan Agreement and any other Loan Document shall mean and refer to each of Parent and Target thereunder, individually and collectively.  Target assumes, as a joint and several obligor thereunder, all of the Obligations, liabilities and indemnities of a Borrower under the Loan Agreement and all other Loan Documents; and covenants and agrees to be bound by and adhere to all of the terms, covenants, waivers, releases, agreements and conditions of or respecting a Borrower with respect to the Loan Agreement and the other Loan Documents and all of the representations and warranties contained in the Loan Agreement and the other Loan Documents with respect to a Borrower. Without limiting the generality of the foregoing, Target grants Bank a security interest in the Collateral described on Exhibit A to the Loan Agreement to secure performance and payment of all Obligations under the Loan Agreement, and authorizes Bank to file financing statements or other instruments with all appropriate jurisdictions to perfect or protect Bank’s interest or rights hereunder and under the Loan Documents. 

2.ADDITIONAL DOCUMENTS.  In connection with and in furtherance of the foregoing, Target hereby also delivers to Bank the following documents: 

(a)corporate resolutions and incumbency certificate duly executed by Target, with certified copies of Target’s articles of incorporation and bylaws; 

(b)intellectual property security agreement duly executed by Target; and

(c) such other documents, instruments and agreements as Bank may reasonably request. 

3.MISCELLANEOUS.  Unless otherwise defined, all initially capitalized terms in this Joinder shall be as defined in the Loan Agreement.  The Loan Agreement, as amended hereby, shall be and remain in full force and effect in accordance with its respective terms and hereby is ratified and confirmed in all respects.  In the event that any signature to this Joinder is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original hereof.  

[signature page follows]

5

 

In Witness Whereof, the undersigned has executed this Joinder as of the date set forth above.

 

	
TARGET:

	
 
	
 
	
 

	
3VR Security, Inc.

	
 
	
 
	
 

	
By:
	
 
	
/s/ Sandra Wallach

	
Name:
	
 
	
Sandra Wallach

	
Title:
	
 
	
CFO

	
 
	
 
	
 

	
PARENT:

	
 
	
 
	
 

	
IDENTIV, INC.

	
 
	
 
	
 

	
By:
	
 
	
/s/ Steven Humphreys

	
Name:
	
 
	
Steven Humphreys

	
Title:
	
 
	
CEO

	
 
	
 
	
 

	
BANK:

	
 
	
 
	
 

	
EAST WEST BANK

	
 
	
 
	
 

	
By:
	
 
	
/s/ Kelvin Chan

	
Name:
	
 
	
Kelvin Chan

	
Title:
	
 
	
Managing Director

 

6

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