Document:

lqda_Ex10_1

		

			Exhibit 10.1

		

		
			LIQUIDIA TECHNOLOGIES, INC.
		

		
			AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
		

		
			 
		

		
			 
		

		
			

		 

		

			

		

		

			 

		

 

		

			 

		

		

		
			This AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (the “Agreement”) is entered into as of October 26, 2018 by and between PACIFIC WESTERN BANK, a California state-chartered bank (“Bank”) and LIQUIDIA TECHNOLOGIES, INC. (“Borrower”).
		

		
			RECITALS
		

		
			A.Bank and Borrower have entered into that certain Loan and Security Agreement dated as of January 6, 2016 (as amended, the “Prior Loan Agreement”).
		

		
			B.Borrower has requested, and Bank has agreed, to amend and restate the Prior Loan Agreement in its entirety.  Bank and Borrower hereby agree that the Prior Loan Agreement is amended and restated in its entirety as set forth below.
		

		
			C.Borrower wishes to obtain credit from time to time from Bank, and Bank desires to extend credit to Borrower.  This Agreement sets forth the terms on which Bank will advance credit to Borrower, and Borrower will repay the amounts owing to Bank.
		

		
			AGREEMENT
		

		
			The parties agree as follows:
		

			
	
			
				 1.
			DEFINITIONS AND CONSTRUCTION.

			
	
			
				 1.1
			Definitions.  As used in this Agreement, all capitalized terms shall have the definitions set forth on Exhibit A.  Any term used in the Code and not defined herein shall have the meaning given to the term in the Code.

			
	
			
				 1.2
			Accounting Terms.  Any accounting term not specifically defined on Exhibit A shall be construed in accordance with GAAP and all calculations shall be made in accordance with GAAP (except for non-compliance with ASC 718 in monthly reporting).  The term “financial statements” shall include the accompanying notes and schedules.

			
	
			
				 2.
			LOAN AND TERMS OF PAYMENT.

			
	
			
				 2.1
			Credit Extensions.

			
	
			
				 (a)
			Promise to Pay.  Borrower promises to pay to Bank, in lawful money of the United States of America, the aggregate unpaid principal amount of all Credit Extensions made by Bank to Borrower, together with interest on the unpaid principal amount of such Credit Extensions at rates in accordance with the terms hereof.

		
			(b)Term Loan.
		

		
			(i)Subject to and upon the terms and conditions of this Agreement, Bank agrees to make one (1) or more term loans to Borrower in an aggregate principal amount not to exceed Sixteen Million Dollars ($16,000,000) (each a “Term Loan” and collectively the “Term Loans”).    
		

		
			

		 

		

			1.

		

 

		

			 

		

		

		
			Eleven Million Dollars ($11,000,000) of the Term Loans (“Tranche  A”) shall be advanced to the Borrower on the Closing Date. The proceeds of the Tranche A Term Loans shall be used first to refinance Borrower’s existing Indebtedness to Bank and the UNC Debt, with any amounts remaining thereafter used for general working capital purposes and for capital expenditures.
		

		
			The remaining Five Million Dollars ($5,000,000) of the Term Loans (“Tranche  B”) shall be available through the Tranche B Availability End Date, provided that Borrower achieves the Performance Milestone. Funds will be available under Tranche B  as soon as Borrower delivers to Bank evidence satisfactory to Bank that Borrower has achieved the Performance Milestone. Each Tranche B Term Loan, except the last Tranche B Term Loan, must be in a minimum amount of $500,000. The proceeds of the Tranche B Term Loans shall be used for general working capital purposes and for capital expenditures.
		

		
			(ii)Interest shall accrue from the date of each Term Loan at the rate specified in Section 2.2(a), and during the Interest-Only Period interest on the applicable Term Loan shall be payable monthly beginning on the first day of the month next following such Term Loan, and continuing on the same day of each month thereafter.  Any Term Loans that are outstanding on the last day of the Interest-Only Period shall be payable in equal monthly installments of principal, plus all accrued interest, beginning on the next day after the last day of the Interest-Only Period (the “Conversion Date”), and continuing on the same day of each month thereafter in amounts that would fully amortize each applicable Term Loan, as of the Conversion Date, over the Repayment Period. All amounts remaining due in connection with the Term Loans and any other amounts due under this Agreement shall be immediately due and payable on the Term Loan Maturity Date.  Term Loans, once repaid, may not be reborrowed. Subject to payment of the Prepayment Fee as set forth in Section 2.4(c) hereof, Borrower may prepay any Term Loan without any penalty or additional premium.
		

		
			(iii)When Borrower desires to obtain a Term Loan, Borrower shall notify Bank (which notice shall be irrevocable) by facsimile transmission or email to be received no later than 3:30 p.m. Eastern time on the day on which the Term Loan is to be made.  Such notice shall be given by a Loan Advance/Paydown Request Form in substantially the form of Exhibit C.  The notice shall be signed by an Authorized Officer. Bank shall be entitled to rely on any notice given by a person whom Bank reasonably believes to be an Authorized Officer, and Borrower shall indemnify and hold Bank harmless for any damages, loss, costs and expenses suffered by Bank as a result of such reliance.
		

			
	
			
				 (c)
			Usage of Credit Card Services Under the Credit Card Line.

			
	
			
				 (i)
			Usage Period.  Subject to and upon the terms and conditions of this Agreement, at any time from the Closing Date through the Credit Card Maturity Date, Borrower may use the Credit Card Services (as defined below) in amounts and upon terms as provided in Section 2.1(c)(ii) below.

			
	
			
				 (ii)
			Credit Card Services.  Subject to and upon the terms and conditions of this Agreement, Borrower may request corporate credit cards and standard and e-commerce merchant account services from Bank (collectively, the “Credit Card Services”). 

		 

		

			2.

		

 

		

			 

		

	The aggregate limit of the corporate credit cards and merchant credit card processing reserves shall not exceed the Credit Card Line.  The terms and conditions (including repayment and fees) of such Credit Card Services shall be subject to the terms and conditions of Bank’s standard forms of application and agreement for the Credit Card Services, which Borrower hereby agrees to execute.

			
	
			
				 (iii)
			Collateralization of Obligations Extending Beyond Maturity.  If Borrower has not cash secured its obligations with respect to any Credit Card Services by the Credit Card Maturity Date, then, effective as of such date, the balance in any deposit accounts held by Bank and the certificates of deposit or time deposit accounts issued by Bank in Borrower’s name (and any interest paid thereon or proceeds thereof, including any amounts payable upon the maturity or liquidation of such certificates or accounts), shall automatically secure such obligations to the extent of the then continuing or outstanding Credit Card Services.  Borrower authorizes Bank to hold such balances in pledge and to decline to honor any drafts thereon or any requests by Borrower or any other Person to pay or otherwise transfer any part of such balances for so long as the applicable Credit Card Services are outstanding or continue.

			
	
			
				 2.2
			Interest Rates, Payments, and Calculations.

			
	
			
				 (a)
			Interest Rates.

			
	
			
				 (i)
			Term Loans.  Except as set forth in Section 2.2(b), the Term Loans shall bear interest, on the outstanding daily balance thereof, at a variable annual rate equal to the greater of: (A) the Prime Rate then in effect; or (B) five percent (5.00%).

			
	
			
				 (b)
			Late Fee; Default Rate.  If any payment is not made within 15 days after the date such payment is due, Borrower shall pay Bank a late fee equal to the lesser of (i) 5% of the amount of such unpaid amount or (ii) the maximum amount permitted to be charged under applicable law.  All Obligations shall bear interest, from and after the occurrence and during the continuance of an Event of Default, at a rate equal to 5 percentage points above the interest rate applicable immediately prior to the occurrence of the Event of Default.

			
	
			
				 (c)
			Payments.  Borrower authorizes Bank to, at its option, charge such interest, all Bank Expenses, all Periodic Payments, and any other amounts due and owing in accordance with the terms of this Agreement against any of Borrower’s deposit accounts, in which case those amounts shall thereafter accrue interest at the rate then applicable hereunder.  Any interest not paid when due shall be compounded by becoming a part of the Obligations, and such interest shall thereafter accrue interest at the rate then applicable hereunder.  All payments shall be free and clear of any taxes, withholdings, duties, impositions or other charges (other than income, branch profits and franchise taxes), to the end that Bank will receive the entire amount of any Obligations payable hereunder, regardless of source of payment.

			
	
			
				 (d)
			Computation.  In the event the Prime Rate is changed from time to time hereafter, the applicable rate of interest hereunder shall be increased or decreased, effective as of the day the Prime Rate is changed, by an amount equal to such change in the Prime Rate.  All 

		 

		

			3.

		

 

		

			 

		

	interest chargeable under the Loan Documents shall be computed on the basis of a 360-day year for the actual number of days elapsed.

			
	
			
				 2.3
			Crediting Payments.  Other than any time after the occurrence and during the continuance of an Event of Default, Bank shall credit a wire transfer of funds, check or other item of payment to such deposit account or Obligation as Borrower specifies.  After the occurrence and during the continuance of an Event of Default, Bank shall have the right, in its sole discretion, to immediately apply any wire transfer of funds, check, or other item of payment Bank may receive to conditionally reduce Obligations, but such applications of funds shall not be considered a payment on account unless such payment is of immediately available federal funds or unless and until such check or other item of payment is honored when presented for payment.  Notwithstanding anything to the contrary contained herein, any wire transfer or payment received by Bank after 5:30 p.m. Eastern time shall be deemed to have been received by Bank as of the opening of business on the immediately following Business Day. Whenever any payment to Bank under the Loan Documents would otherwise be due (except by reason of acceleration) on a date that is not a Business Day, such payment shall instead be due on the next Business Day, and additional fees or interest, as the case may be, shall accrue and be payable for the period of such extension.

			
	
			
				 2.4
			Fees.  Borrower shall pay to Bank the following:

			
	
			
				 (a)
			Facility Fee.  On or before the Closing Date, a fee equal to Five Thousand Dollars ($5,000), which shall be nonrefundable;

			
	
			
				 (b)
			Bank Expenses.  On the Closing Date, all Bank Expenses incurred through the Closing Date, and, after the Closing Date, all Bank Expenses, as and when they become due.

			
	
			
				 (c)
			Prepayment Fee. A fee (the “Prepayment Fee”) in connection with any prepayment of the Term Loan under Section 2.1(b) in an amount equal to (i) two percent (2%) of the principal amount of Term Loan so prepaid if the Term Loan is prepaid within one (1) year of the Closing Date, (ii) one percent (1.00%) of the principal amount of the Term Loan so prepaid if the Term Loan is prepaid between one (1) year and two (2) years after the Closing Date, or (iii) Zero Dollars ($0) if repaid more than two (2) years after the Closing Date.

			
	
			
				 (d)
			Near-Term Success Fee.  If a Liquidity Event occurs prior to October 31, 2019, Borrower shall pay to Bank a fee (the “Near-Term Success Fee”) of: (i)  $187,000 if Borrower has not received a Tranche B Term Loan, or (ii) $225,000 if Borrower has received a Tranche B Term Loan.  This Section 2.4(d) shall survive any termination of this Agreement. 

		
			(e)  Long-Term Success Fee.  If a Liquidity Event occurs on or after October 31, 2019, Borrower shall pay to Bank a fee (the “Long-Term Success Fee”) of: (i) $275,000 if Borrower has not received a Tranche B Term Loan, or (ii) $375,000 if Borrower has received a Tranche B Term Loan.  This Section 2.4(e) shall survive any termination of this Agreement. 
		

		
			 
		

		
			

		 

		

			4.

		

 

		

			 

		

		

		
			For the avoidance of doubt, under no circumstances shall Borrower be required to pay both the Near-Term Success Fee described in Section 2.4(d)  and the Long-Term Success Fee described in Section 2.4(e).
		

		
			 
		

			
	
			
				 2.5
			Term.  This Agreement shall become effective on the Closing Date and, subject to Section 12.7, shall continue in full force and effect for so long as any Obligations (other than inchoate indemnity obligations) remain outstanding or Bank has any obligation to make Credit Extensions under this Agreement.  Notwithstanding the foregoing, Bank shall have the right to terminate its obligation to make Credit Extensions under this Agreement immediately and without notice upon the occurrence and during the continuance of an Event of Default.

			
	
			
				 3.
			CONDITIONS OF LOANS.

			
	
			
				 3.1
			Conditions Precedent to Closing.  The agreement of Bank to enter into this Agreement on the Closing Date is subject to the condition precedent that Bank shall have received, in form and substance satisfactory to Bank, each of the following items and completed each of the following requirements:

			
	
			
				 (a)
			this Agreement;

			
	
			
				 (b)
			an officer’s certificate of Borrower with respect to incumbency and resolutions authorizing the execution and delivery of this Agreement;

			
	
			
				 (c)
			payment of the fees and Bank Expenses then due specified in Section 2.4, which may be debited from any of Borrower’s accounts with Bank;

			
	
			
				 (d)
			current SOS Reports indicating that except for Permitted Liens, there are no other security interests or Liens of record in the Collateral;

			
	
			
				 (e)
			current financial statements, including audited statements (or such other level required by the Investment Agreement) for Borrower’s most recently ended fiscal year, together with an unqualified opinion (or an opinion qualified only for going concern so long as Borrower’s investors provide additional equity as needed), company prepared consolidated and consolidating balance sheets,  income statements, and statements of cash flows for the most recently ended month in accordance with Section 6.2, and such other updated financial information as Bank may reasonably request; 

			
	
			
				 (f)
			current Compliance Certificate in accordance with Section 6.2; 

			
	
			
				 (g)
			evidence satisfactory to Bank that the insurance policies required by Section 6.5 hereof are in full force and effect, together with appropriate evidence showing loss payable and additional insured clauses or endorsements in favor of Bank, 

			
	
			
				 (h)
			an updated Borrower Information Certificate; 

			
	
			
				 (i)
			a payoff letter from the University of North Carolina at Chapel Hill covering the UNC Debt;  and

		
			

		 

		

			5.

		

 

		

			 

		

		

			
	
			
				 (j)
			such other documents or certificates, and completion of such other matters, as Bank may reasonably request.

			
	
			
				 3.2
			Conditions Precedent to all Credit Extensions.  The obligation of Bank to make each Credit Extension, including the initial Credit Extension, is contingent upon the Borrower’s compliance with Section 3.1 above, and is further subject to the following conditions:

			
	
			
				 (a)
			timely receipt by Bank of the Loan Advance/Paydown Request Form as provided in Section 2.1;  

			
	
			
				 (b)
			Borrower shall have transferred substantially all of its Cash assets into operating accounts held with Bank and otherwise be in compliance with Section 6.6 hereof; 

			
	
			
				 (c)
			in Bank’s sole discretion, there has not been a Material Adverse Effect; and

			
	
			
				 (d)
			the representations and warranties contained in Section 5 shall be true and correct in all material respects on and as of the date of such Loan Advance/Paydown Request Form and on the effective date of each Credit Extension as though made at and as of each such date, and no Event of Default shall have occurred and be continuing, or would exist after giving effect to such Credit Extension (provided, however, that those representations and warranties expressly referring to another date shall be true and correct in all material respects as of such date, and provided further that any representation or warranty that contains a materiality qualification therein shall be true and correct in all respects).  The making of each Credit Extension shall be deemed to be a representation and warranty by Borrower on the date of such Credit Extension as to the accuracy of the facts referred to in this Section 3.2.

			
	
			
				 4.
			CREATION OF SECURITY INTEREST.

			
	
			
				 4.1
			Grant of Security Interest.  Borrower grants and pledges to Bank a continuing security interest in the Collateral to secure prompt repayment of any and all Obligations and to secure prompt performance by Borrower of each of its covenants and duties under the Loan Documents.  Except for Permitted Liens or as disclosed in the Schedule, such security interest constitutes a valid, first priority security interest in the presently existing Collateral, and will constitute a valid, first priority security interest in later-acquired Collateral.  Borrower also hereby agrees not to sell, transfer, assign, mortgage, pledge, lease, grant a security interest in, or encumber any of its Intellectual Property except for Permitted Transfers.    Notwithstanding any termination of this Agreement or of any filings undertaken related to Bank’s rights under the Code, Bank’s Lien on the Collateral shall remain in effect for so long as any Obligations (other than inchoate indemnity obligations) are outstanding.

			
	
			
				 4.2
			Perfection of Security Interest.  Borrower authorizes Bank to file at any time financing statements, continuation statements, and amendments thereto that (i) either specifically describe the Collateral or describe the Collateral as all assets of Borrower of the kind pledged hereunder, and (ii) contain any other information required by the Code for the sufficiency of filing office acceptance of any financing statement, continuation statement, or amendment, including whether Borrower is an organization, the type of organization and any organizational identification number issued to Borrower, if applicable.  Borrower shall have possession of the 

		 

		

			6.

		

 

		

			 

		

	Collateral, except where expressly otherwise provided in this Agreement or where Bank chooses to perfect its security interest by possession in addition to the filing of a financing statement.  Where Collateral is in possession of a third party bailee, Borrower shall take such steps as Bank reasonably requests for Bank to (i) subject to Section 7.11 below, obtain an acknowledgment, in form and substance satisfactory to Bank, of the bailee that the bailee holds such Collateral for the benefit of Bank, and (ii) obtain “control” of any Collateral consisting of investment property, deposit accounts, letter-of-credit rights or electronic chattel paper (as such items and the term “control” are defined in Revised Article 9 of the Code) by causing the securities intermediary or depositary institution or issuing bank to execute a control agreement in form and substance satisfactory to Bank.  Borrower will not create any chattel paper without placing a legend on the chattel paper acceptable to Bank indicating that Bank has a security interest in the chattel paper.  Borrower from time to time may deposit with Bank specific cash collateral to secure specific Obligations; Borrower authorizes Bank to hold such specific balances in pledge and to decline to honor any drafts thereon or any request by Borrower or any other Person to pay or otherwise transfer any part of such balances for so long as the specific Obligations are outstanding.  Borrower shall take such other actions as Bank requests to perfect its security interests granted under this Agreement.

			
	
			
				 5.
			REPRESENTATIONS AND WARRANTIES.

		
			Borrower represents and warrants as follows:
		

			
	
			
				 5.1
			Due Organization and Qualification.  Borrower and each Subsidiary is duly existing under the laws of the state in which it is organized and qualified and licensed to do business in any state in which the conduct of its business or its ownership of property requires that it be so qualified, except where the failure to do so would not reasonably be expected to cause a Material Adverse Effect.  

			
	
			
				 5.2
			Due Authorization; No Conflict.  The execution, delivery, and performance of the Loan Documents are within Borrower’s powers, have been duly authorized, and are not in conflict with nor constitute a breach of any provision contained in Borrower’s Certificate of Incorporation or Bylaws, nor will they constitute an event of default under any material agreement by which Borrower is bound.  Borrower is not in default under any agreement by which it is bound, including that certain Amended and Restated License Agreement dated December 15, 2008 by and between the University of North Carolina at Chapel Hill and Borrower, except to the extent such default would not reasonably be expected to cause a Material Adverse Effect.

			
	
			
				 5.3
			Collateral.  Borrower has rights in or the power to transfer the Collateral, and its title to the Collateral is free and clear of Liens, adverse claims, and restrictions on transfer or pledge except for Permitted Liens.    Other than movable items of personal property such as laptop computers, all Collateral having an aggregate book value in excess of $100,000, is located solely in the Collateral States.  All Inventory is in all material respects of good and merchantable quality, free from all material defects, except for Inventory for which adequate reserves have been made.  Except as set forth in the Schedule, none of the Borrower’s Cash is maintained or invested with a Person other than Bank or Bank’s affiliates.

		
			

		 

		

			7.

		

 

		

			 

		

		

			
	
			
				 5.4
			Intellectual Property.  Borrower is the sole owner (except for Intellectual Property jointly owned with the University of North Carolina (“UNC”) or GlaxoSmithKline (“GSK”)) or licensee of the Intellectual Property, and owns or control the Intellectual Property created (whether solely or jointly with UNC or GSK) or purchased by Borrower, except for licenses granted by Borrower in the ordinary course of business.  To Borrower’s knowledge, each of the Copyrights, Trademarks and Patents created or purchased by Borrower is valid and enforceable, and no part of the Intellectual Property created or purchased by Borrower has been judged invalid or unenforceable, in whole or in part, and no claim has been made to Borrower that any part of the Intellectual Property created or purchased by Borrower violates the rights of any third party except to the extent such claim would not reasonably be expected to cause a Material Adverse Effect.

			
	
			
				 5.5
			Name; Location of Chief Executive Office.  Except as disclosed in the Schedule, Borrower has not done business under any name other than that specified on the signature page hereof, and its exact legal name is as set forth in the first paragraph of this Agreement.  The chief executive office of Borrower is located at the address indicated in Section 10 hereof.

			
	
			
				 5.6
			Litigation.  Except as set forth in the Schedule, there are no actions or proceedings pending by or against Borrower or any Subsidiary before any court or administrative agency in which a likely adverse decision would reasonably be expected to have a Material Adverse Effect.

			
	
			
				 5.7
			No Material Adverse Change in Financial Statements.  All consolidated and consolidating financial statements related to Borrower and any Subsidiary that are delivered by Borrower to Bank fairly present in all material respects Borrower’s consolidated and consolidating financial condition as of the date thereof and Borrower’s consolidated and consolidating results of operations for the period then ended.  There has not been a material adverse change in the consolidated or in the consolidating financial condition of Borrower since the date of the most recent of such financial statements submitted to Bank.

			
	
			
				 5.8
			Solvency, Payment of Debts.  Borrower is able to pay its debts (including trade debts) as they mature; the fair saleable value of Borrower’s assets (including goodwill minus disposition costs) exceeds the fair value of its liabilities; and Borrower is not left with unreasonably small capital after the transactions contemplated by this Agreement.

			
	
			
				 5.9
			Compliance with Laws and Regulations.  Borrower and each Subsidiary have met the minimum funding requirements of ERISA with respect to any employee benefit plans subject to ERISA.  No event has occurred resulting from Borrower’s failure to comply with ERISA that is reasonably likely to result in Borrower’s incurring any liability that could have a Material Adverse Effect.  Borrower is not an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940.  Borrower is not engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of Regulations T and U of the Board of Governors of the Federal Reserve System).  Borrower has not violated any statutes, laws, ordinances or rules applicable to it, the violation of which would reasonably be expected to have a Material Adverse Effect.  Borrower and each Subsidiary have filed or caused to be filed all 

		 

		

			8.

		

 

		

			 

		

	tax returns required to be filed, and have paid, or have made adequate provision for the payment of, all taxes reflected therein except those being contested in good faith with adequate reserves under GAAP or where the failure to file such returns or pay such taxes would not reasonably be expected to have a Material Adverse Effect.

			
	
			
				 5.10
			Subsidiaries.  Borrower does not own any stock, partnership interest or other equity securities of any Person, except for Permitted Investments.

			
	
			
				 5.11
			Government Consents.  Borrower and each Subsidiary have obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all governmental authorities that are necessary for the continued operation of Borrower’s business as currently conducted, except where the failure to do so would not reasonably be expected to cause a Material Adverse Effect.

			
	
			
				 5.12
			Inbound Licenses.  Except as disclosed on the Schedule, Borrower is not a party to, nor is bound by, any material license or other agreement important for the conduct of Borrower’s business that prohibits or otherwise restricts Borrower from granting a security interest in Borrower’s interest in such license or agreement important for the conduct of Borrower’s business, other than this Agreement or the other Loan Documents.

			
	
			
				 5.13
			Full Disclosure.  No representation, warranty or other statement made by Borrower in any certificate or written statement furnished to Bank taken together with all such certificates and written statements furnished to Bank contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained in such certificates or statements not misleading in light of the circumstances in which they were made, it being recognized by Bank that the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not to be viewed as facts and that actual results during the period or periods covered by any such projections and forecasts may differ from the projected or forecasted results.

			
	
			
				 6.
			AFFIRMATIVE COVENANTS.

		
			Borrower covenants that, until payment in full of all outstanding Obligations (other than inchoate indemnity obligations), and for so long as Bank may have any commitment to make a Credit Extension hereunder, Borrower shall do all of the following:
		

			
	
			
				 6.1
			Good Standing and Government Compliance.  Borrower shall maintain its and each of its Subsidiaries’ corporate existence and good standing in the respective states of formation, shall maintain qualification and good standing in each other jurisdiction in which the failure to so qualify would reasonably be expected to have a Material Adverse Effect, and shall furnish to Bank the organizational identification number issued to Borrower by the authorities of the state in which Borrower is organized, if applicable.  Borrower shall meet, and shall cause each Subsidiary to meet, the minimum funding requirements of ERISA with respect to any employee benefit plans subject to ERISA.  Borrower shall comply, and shall cause each Subsidiary to comply, with all statutes, laws, ordinances and government rules and regulations to which it is subject, and shall maintain, and shall cause each of its Subsidiaries to maintain, in force all licenses, 

		 

		

			9.

		

 

		

			 

		

	approvals and agreements, the loss of which or failure to comply with which would reasonably be expected to have a Material Adverse Effect.

			
	
			
				 6.2
			Financial Statements, Reports, Certificates, Collateral Audits.  

			
	
			
				 (a)
			Borrower shall deliver to Bank:  (i) as soon as available, but in any event within 30 days after the end of each calendar month, a company prepared consolidated and consolidating balance sheet,  income statement, and statement of cash flows covering Borrower’s operations during such period, along with accounts payable agings, all in a form reasonably acceptable to Bank and certified by a Responsible Officer; (ii) as soon as available, but in any event within 180 days after the end of Borrower’s fiscal year, audited (or such other level as is required by the Investment Agreement) consolidated and consolidating financial statements of Borrower prepared in accordance with GAAP, consistently applied, together with an opinion which is either unqualified (provided that the opinion may contain a qualification as to going concern typical for venture backed companies similar to Borrower) or otherwise consented to in writing by Bank on such financial statements of an independent certified public accounting firm reasonably acceptable to Bank; (iii) annual budget approved by Borrower’s Board of Directors as soon as available but not later than sixty (60) days after the end of each fiscal year during the term hereof; (iv) if applicable, copies of all statements, reports and notices sent or made available generally by Borrower to its security holders or to any holders of Subordinated Debt and all reports on Forms 10-K and 10-Q filed (including, but not limited to, quarterly clinical program updates) with the Securities and Exchange Commission; (v) promptly upon receipt of notice thereof, a report of any legal actions pending or threatened against Borrower or any Subsidiary that could reasonably be expected to result in damages or costs to Borrower or any Subsidiary of $500,000 or more; (vi) promptly upon receipt, each management letter prepared by Borrower’s independent certified public accounting firm regarding Borrower’s management control systems; and (vii) such budgets, sales projections, operating plans or other financial information as Bank may reasonably request from time to time.    

			
	
			
				 (b)
			Within 30 days after the last day of each month, Borrower shall deliver to Bank with the monthly financial statements a Compliance Certificate certified as of the last day of the applicable month and signed by a Responsible Officer in substantially the form of Exhibit D hereto.

			
	
			
				 (c)
			As soon as possible and in any event within three (3) calendar days after becoming aware of the occurrence or existence of an Event of Default hereunder, a written statement of a Responsible Officer setting forth details of the Event of Default, and the action which Borrower has taken or proposes to take with respect thereto.

			
	
			
				 (d)
			Borrower shall deliver to Bank the notices required in Section 7.2.

			
	
			
				 (e)
			Bank (through any of its officers, employees, or agents) shall have the right, upon reasonable prior notice, from time to time during Borrower’s usual business hours but no more than twice a year (unless an Event of Default has occurred and is continuing), to inspect Borrower’s Books and to make copies thereof and to check, test, inspect, audit and appraise the Collateral at Borrower’s expense in order to verify Borrower’s financial condition or the amount, condition of, or any other matter relating to, the Collateral.

		
			

		 

		

			10.

		

 

		

			 

		

		

		
			Borrower may deliver to Bank on an electronic basis any certificates, reports or information required pursuant to this Section 6.2, and Bank shall be entitled to rely on the information contained in the electronic files, provided that Bank in good faith believes that the files were delivered by a Responsible Officer.  Borrower shall include a submission date on any certificates and reports to be delivered electronically.
		

			
	
			
				 6.3
			Inventory and Equipment; Returns.  Borrower shall keep all Inventory and Equipment in good and merchantable condition, free from all material defects except for Inventory and Equipment (i) sold in the ordinary course of business, and (ii) for which adequate reserves have been made, in all cases in the United States and such other locations as to which Borrower gives prior written notice.  Returns and allowances, if any, as between Borrower and its account debtors shall be on the same basis and in accordance with the usual customary practices of Borrower, as they exist on the Closing Date.  Borrower shall promptly notify Bank of all returns and recoveries and of all disputes and claims involving inventory having a book value of more than $200,000.

			
	
			
				 6.4
			Taxes.  Borrower shall make, and cause each Subsidiary to make, due and timely payment or deposit of all material federal, state, and local taxes, assessments, or contributions required of it by law, including, but not limited to, those laws concerning income taxes, F.I.C.A., F.U.T.A. and state disability, and will execute and deliver to Bank, on demand, proof satisfactory to Bank indicating that Borrower or a Subsidiary has made such payments or deposits and any appropriate certificates attesting to the payment or deposit thereof; provided that Borrower or a Subsidiary need not make any payment if the amount or validity of such payment is contested in good faith by appropriate proceedings and is reserved against (to the extent required by GAAP) by Borrower or such Subsidiary.

			
	
			
				 6.5
			Insurance.  Borrower, at its expense, shall (i) keep the Collateral insured against loss or damage, and (ii) maintain liability and other insurance, in each case as ordinarily insured against by other owners in businesses similar to Borrower’s.  All such policies of insurance shall be in such form, with such companies, and in such amounts as reasonably satisfactory to Bank.  All policies of property insurance shall contain a lender’s loss payable endorsement, in a form satisfactory to Bank, showing Bank as lender's loss payee.  All liability insurance policies shall show, or have endorsements showing, Bank as an additional insured.  Any such insurance policies shall specify that the insurer must give at least twenty (20) days’ notice to Bank before canceling its policy for any reason.  Within thirty (30) days of the Closing Date, Borrower shall cause to be furnished to Bank a copy of its policies including any endorsements covering Bank or showing Bank as an additional insured.  Upon Bank’s request, Borrower shall deliver to Bank certified copies of the policies of insurance and evidence of all premium payments.  Proceeds payable under any casualty policy will, at Borrower’s option, be payable to Borrower to replace the property subject to the claim, provided that any such replacement property shall be deemed Collateral in which Bank has been granted a first priority security interest, provided that if an Event of Default has occurred and is continuing, all proceeds payable under any such policy shall, at Bank’s option, be payable to Bank to be applied on account of the Obligations.

			
	
			
				 6.6
			Primary Depository.  Subject to the provisions of Section 3.2(b), as of the Closing Date, Borrower shall maintain, and shall cause all of its Subsidiaries to maintain, all  depository and operating accounts with Bank and all  investment accounts with Bank or Bank’s 

		 

		

			11.

		

 

		

			 

		

	affiliates; provided that prior to Borrower maintaining any investment accounts with Bank’s affiliates, Borrower, Bank, and any such affiliate shall have entered into a securities account control agreement with respect to any such investment accounts, in form and substance satisfactory to Bank.  Notwithstanding the above, Borrower shall be permitted to maintain an aggregate amount not to exceed $100,000 in one or more accounts outside of Bank.

			
	
			
				 6.7
			Financial Covenants. Borrower shall at all times maintain the following financial ratios and covenants:

			
	
			
				 (a)
			Minimum Cash at Bank.  Monitored on a daily basis, a balance of Cash at Bank of not less Eight Million Five Hundred Thousand Dollars ($8,500,000) (the “Minimum Cash Threshold”); provided however, that the Minimum Cash Threshold shall be decreased to Six Million Dollars ($6,000,000) if Borrower provides evidence reasonably acceptable to Bank that Borrower has achieved the Funding Milestone.  Notwithstanding the foregoing, up to two (2) times per calendar year, Borrower may allow its balance of Cash at Bank to be below the applicable Minimum Cash Threshold, so long as (i) Borrower’s balance of Cash at Bank shall not at any time be less than Two Hundred Fifty Thousand Dollars ($250,000) below the applicable Minimum Cash Threshold, and (ii) Borrower’s balance of Cash at Bank shall not remain below the applicable Minimum Cash Threshold for more than three (3) consecutive Business Days per occurrence.    

			
	
			
				 6.8
			Protection of Intellectual Property.

			
	
			
				 (a)
			Borrower shall promptly give Bank written notice on a quarterly basis of any applications or registrations of intellectual property rights filed with the United States Patent and Trademark Office during such fiscal year, including the date of such filing and the registration or application numbers, if any.

			
	
			
				 (b)
			Except for Permitted Transfers, Borrower shall (i) protect, defend and maintain the validity and enforceability of the trade secrets, Trademarks, Patents and Copyrights material to the business of Borrower, (ii) use commercially reasonable efforts to detect infringements of such Trademarks, Patents and Copyrights and promptly advise Bank in writing of material infringements detected and (iii) not allow any material Trademarks, Patents or Copyrights to be abandoned, forfeited or dedicated to the public without the written consent of Bank, which shall not be unreasonably withheld.

			
	
			
				 (c)
			Bank shall have the right, but not the obligation, to take, at Borrower’s sole expense, any actions that Borrower is required under this Section 6.8 to take but which Borrower fails to take, after 15 days’ notice to Borrower.  Borrower shall reimburse and indemnify Bank for all reasonable costs and reasonable out-of-pocket expenses incurred in the reasonable exercise of its rights under this Section 6.8.

			
	
			
				 6.9
			Consent of Inbound Licensors.  Prior to entering into or becoming bound by any material inbound license or similar agreement, Borrower shall:  (i) provide written notice to Bank of the material terms of such license or agreement with a description of its likely impact on Borrower’s business or financial condition; and (ii) in good faith use commercially reasonable efforts to obtain the consent of, or waiver by, any person whose consent or waiver is necessary for 

		 

		

			12.

		

 

		

			 

		

	Borrower’s interest in such licenses or contract rights to be deemed Collateral and for Bank to have a security interest in it that might otherwise be restricted by the terms of the applicable license or agreement, whether now existing or entered into in the future, provided, however, that the failure to obtain any such consent or waiver shall not constitute a default under this Agreement.

		
			6.10 Creation/Acquisition of Subsidiaries.  In the event any Borrower or any Subsidiary of any Borrower creates or acquires any Subsidiary, Borrower or such Subsidiary shall promptly notify Bank of such creation or acquisition, and Borrower or such Subsidiary shall take all actions reasonably requested by Bank to achieve any of the following with respect to such “New Subsidiary” (defined as a Subsidiary formed after the date hereof during the term of this Agreement):  (i) to cause New Subsidiary to become either a co-Borrower hereunder, if such New Subsidiary is organized under the laws of the United States, or a secured guarantor with respect to the Obligations; and (ii) to grant and pledge to Bank a perfected security interest in 100% of the stock, units or other evidence of ownership held by Borrower or its Subsidiaries of any such New Subsidiary which is organized under the laws of the United States, and 65% of the stock, units or other evidence of ownership held by Borrower or its Subsidiaries of any such New Subsidiary which is not organized under the laws of the United States.
		

			
	
			
				 6.11
			Further Assurances.  At any time and from time to time Borrower shall execute and deliver such further instruments and take such further action as may reasonably be requested by Bank to effect the purposes of this Agreement.

			
	
			
				 7.
			NEGATIVE COVENANTS.

		
			Borrower covenants and agrees that, so long as any credit hereunder shall be available and until the outstanding Obligations (other than inchoate indemnity obligations) are paid in full or for so long as Bank may have any commitment to make any Credit Extensions, Borrower will not do any of the following without Bank’s prior written consent, which shall not be unreasonably withheld:
		

			
	
			
				 7.1
			Dispositions.  Convey, sell, lease, license, transfer or otherwise dispose of (collectively, to “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, or move cash balances on deposit with Bank to accounts opened at another financial institution, other than Permitted Transfers.

			
	
			
				 7.2
			Change in Name, Location, Executive Office, or Executive Management; Change in Business; Change in Fiscal Year; Change in Control.  Change its name or the state of Borrower’s formation or relocate its chief executive office without 30 days prior written notification to Bank; replace or suffer the departure of its chief executive officer or chief financial officer without delivering written notification to Bank within 10 days; fail to appoint an interim replacement or fill a vacancy in the position of chief executive officer or chief financial officer for more than 30 consecutive days; suffer a change on its board of directors which results in the failure of at least one partner of either New Enterprise Associates or Canaan Partners or their Affiliates to serve as a voting member, in such case without having used best efforts to deliver at least fifteen  (15) days prior written notification to Bank; take action to liquidate, wind up, or otherwise cease to conduct business in the ordinary course; engage in any business, or permit any of its Subsidiaries to engage in any business, other than or reasonably related or incidental to 

		 

		

			13.

		

 

		

			 

		

	the businesses currently engaged in by Borrower; change its fiscal year end; have a Change in Control.

			
	
			
				 7.3
			Mergers or Acquisitions.  Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with or into any other business organization (other than mergers or consolidations of a Subsidiary into another Subsidiary or into Borrower), or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of another Person except where (a) each of the following conditions is applicable:  (i) the consideration paid in connection with such transactions (including assumption of liabilities) does not in the aggregate exceed $250,000 during any fiscal year, (ii) no Event of Default has occurred, is continuing or would exist after giving effect to such transactions, (iii) such transactions do not result in a Change in Control, and (iv) Borrower is the surviving entity; or (b) the Obligations are repaid in full concurrently with the closing of any merger or consolidation of Borrower in which Borrower is not the surviving entity; provided, however, that Borrower shall not, without Bank’s prior written consent, enter into any binding contractual arrangement with any Person to attempt to facilitate a merger or acquisition of Borrower, unless (i) no Event of Default exists when such agreement is entered into by Borrower, (ii) such agreement does not give such Person the right to claim any fee, payment or damages from any parties, other than from Borrower or Borrower’s investors, in connection with a sale of Borrower’s stock or assets pursuant to or resulting from an assignment for the benefit of creditors, an asset turnover to Borrower’s creditors (including, without limitation, Bank), foreclosure, bankruptcy or similar liquidation, and (iii) Borrower notifies Bank in advance of entering into such an agreement (provided, the failure to give such notification shall not be deemed a material breach of this Agreement).

			
	
			
				 7.4
			Indebtedness.  Create, incur, assume, guarantee or be or remain liable with respect to any Indebtedness, or permit any Subsidiary so to do, other than Permitted Indebtedness, or prepay any Indebtedness or take any actions which impose on Borrower an obligation to prepay any Indebtedness, except Indebtedness to Bank.

			
	
			
				 7.5
			Encumbrances.  Create, incur, assume or allow any Lien with respect to its property, or assign or otherwise convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries so to do, except for Permitted Liens, or covenant to any other Person (other than (i) the licensors of in-licensed property with respect to such property or (ii) the lessors of specific equipment or lenders financing specific equipment with respect to such leased or financed equipment) that Borrower in the future will refrain from creating, incurring, assuming or allowing any Lien with respect to any of Borrower’s property.

			
	
			
				 7.6
			Distributions.  Pay any dividends or make any other distribution or payment on account of or in redemption, retirement or purchase of any capital stock, except that Borrower may (i) repurchase the stock of former employees or directors pursuant to stock repurchase agreements in an aggregate amount not to exceed $250,000 in any fiscal year, as long as an Event of Default does not exist prior to such repurchase or would not exist after giving effect to such repurchase, and (ii) repurchase the stock of former employees or directors pursuant to stock repurchase agreements by the cancellation of indebtedness owed by such former employees or directors to Borrower regardless of whether an Event of Default exists.

		
			

		 

		

			14.

		

 

		

			 

		

		

			
	
			
				 7.7
			Investments.  Directly or indirectly acquire or own an Investment in, or make any Investment in or to any Person, or permit any of its Subsidiaries so to do, other than Permitted Investments, or maintain or invest any of its investment property with a Person other than Bank or permit any Subsidiary to do so unless such Person has entered into a control agreement with Bank, in form and substance satisfactory to Bank, or suffer or permit any Subsidiary to be a party to, or be bound by, an agreement that restricts such Subsidiary from paying dividends or otherwise distributing property to Borrower.

			
	
			
				 7.8
			Capitalized Expenditures.  Make Capitalized Expenditures in excess of (a) $500,000 in the aggregate during Borrower’s fiscal year ending December 31, 2018, (b) $1,250,000 in the aggregate during Borrower’s fiscal year ending December 31, 2019, or (c) $500,000 in any fiscal year of Borrower thereafter; provided that any unused amount of Capital Expenditures in any fiscal year up to $500,000 may be added to the limitations under this Section 7.8 and used by Borrower in the subsequent fiscal year.

			
	
			
				 7.9
			Transactions with Affiliates.  Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower except for (i) transactions that are in the ordinary course of Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm’s length transaction with a non-affiliated Person, and (ii) the sale of Borrower’s equity securities in bona fide transactions with Borrower’s existing investors that do not result in a Change in Control.       

			
	
			
				 7.10
			Subordinated Debt.  Make any payment in respect of any Subordinated Debt, or permit any of its Subsidiaries to make any such payment, except in compliance with the terms of such Subordinated Debt, or amend any provision affecting Bank’s rights contained in any documentation relating to the Subordinated Debt without Bank’s prior written consent.

			
	
			
				 7.11
			Inventory and Equipment.  Store the Inventory or the Equipment of an aggregate book value in excess of $250,000 with a bailee, warehouseman, collocation facility or similar third party unless the third party has been notified of Bank’s security interest and Bank (a) has received an acknowledgment from the third party that it is holding or will hold the Inventory or Equipment for Bank’s benefit or (b) is in possession of the warehouse receipt, where negotiable, covering such Inventory or Equipment.  Except for Inventory sold in the ordinary course of business and for movable items of personal property having an aggregate book value not in excess of $250,000, and except for such other locations as Bank may approve in writing, Borrower shall keep the Inventory and Equipment only at the location set forth in Section 10 and such other locations of which Borrower gives Bank prior written notice and as to which Bank is able to take such actions as may be necessary or advisable to perfect its security interest or to obtain a bailee’s acknowledgment of Bank’s rights in the Collateral.

			
	
			
				 7.12
			No Investment Company; Margin Regulation.  Become or be controlled by an “investment company,” within the meaning of the Investment Company Act of 1940, or become principally engaged in, or undertake as one of its important activities, the business of extending credit for the purpose of purchasing or carrying margin stock, or use the proceeds of any Credit Extension for such purpose.

			
	
			
				 8.
			EVENTS OF DEFAULT.

		
			

		 

		

			15.

		

 

		

			 

		

		

		
			Any one or more of the following events shall constitute an Event of Default by Borrower under this Agreement:
		

			
	
			
				 8.1
			Payment Default.  If Borrower fails to pay any of the Obligations when due;

			
	
			
				 8.2
			Covenant Default.  

			
	
			
				 (a)
			If Borrower fails to perform any obligation  under Sections 6.2 (financial reporting), 6.4 (taxes), 6.5 (insurance), 6.6 (primary accounts), or 6.7 (financial covenants), or violates any of the covenants contained in Article ‎7 of this Agreement; or 

			
	
			
				 (b)
			If Borrower fails or neglects to perform or observe any other material term, provision, condition, covenant contained in this Agreement, in any of the Loan Documents, or in any other present or future agreement between Borrower and Bank and as to any default under such other term, provision, condition or covenant that can be cured, has failed to cure such default within 10 days after Borrower receives notice thereof or any officer of Borrower becomes aware thereof; provided, however, that if the default cannot by its nature be cured within the 10 day period or cannot after diligent attempts by Borrower be cured within such 10 day period, and such default is likely to be cured within a reasonable time, then Borrower shall have an additional reasonable period (which shall not in any case exceed 30 days) to attempt to cure such default, and within such reasonable time period the failure to have cured such default shall not be deemed an Event of Default but no Credit Extensions will be made;

			
	
			
				 8.3
			Material Adverse Effect.  If there occurs any circumstance or any circumstances which would reasonably be expected to have a Material Adverse Effect;

			
	
			
				 8.4
			Attachment.  If any material portion of Borrower’s assets is attached, seized, subjected to a writ or distress warrant, or is levied upon, or comes into the possession of any trustee, receiver or person acting in a similar capacity and such attachment, seizure, writ or distress warrant or levy has not been removed, discharged or rescinded within ten (10) days, or if Borrower is enjoined, restrained, or in any way prevented by court order from continuing to conduct all or any material part of its business affairs, or if a judgment or other claim becomes a lien or encumbrance upon any material portion of Borrower’s assets, or if a notice of lien, levy, or assessment is filed of record with respect to any material portion of Borrower’s assets by the United States Government, or any department, agency, or instrumentality thereof, or by any state, county, municipal, or governmental agency, and the same is not paid within ten (10) days after Borrower receives notice thereof, provided that none of the foregoing shall constitute an Event of Default where such action or event is stayed or an adequate bond has been posted pending a good faith contest by Borrower (provided that no Credit Extensions will be made during such cure period);

			
	
			
				 8.5
			Insolvency.  If Borrower becomes insolvent, or if an Insolvency Proceeding is commenced by Borrower, or if an Insolvency Proceeding is commenced against Borrower and is not dismissed or stayed within forty-five  (45) days (provided that no Credit Extensions will be made prior to the dismissal of such Insolvency Proceeding);

			
	
			
				 8.6
			Other Agreements.  If (a) there is a default or other failure to perform in any  agreement to which Borrower is a party with a third party or parties  (i) resulting in a right by 

		 

		

			16.

		

 

		

			 

		

	such third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an amount in excess of $500,000, (ii) in connection with any material lease of real property that gives the landlord the right to terminate such lease,  or  (iii) that would reasonably be expected to have a Material Adverse Effect, or (b) any default or event of default (however designated) shall occur with respect to any Subordinated Debt which is not cured within any applicable cure period;

			
	
			
				 8.7
			Judgments.  If a final, uninsured judgment or judgments for the payment of money in an amount, individually or in the aggregate, of at least $500,000 shall be rendered against Borrower and shall remain unsatisfied and unstayed for a period of 10 days (provided that no Credit Extensions will be made prior to the satisfaction or stay of the judgment); or

			
	
			
				 8.8
			Misrepresentations.  If any material misrepresentation or material misstatement exists now or hereafter in any warranty or representation set forth herein or in any certificate delivered to Bank by any Responsible Officer pursuant to this Agreement or to induce Bank to enter into this Agreement or any other Loan Document.

			
	
			
				 9.
			BANK’S RIGHTS AND REMEDIES.

			
	
			
				 9.1
			Rights and Remedies.  Upon the occurrence and during the continuance of an Event of Default, Bank may, at its election, without notice of its election and without demand, do any one or more of the following, all of which are authorized by Borrower:

			
	
			
				 (a)
			Declare all Obligations, whether evidenced by this Agreement, by any of the other Loan Documents, or otherwise, immediately due and payable (provided that upon the occurrence of an Event of Default described in Section 8.5 (insolvency), all Obligations shall become immediately due and payable without any action by Bank);

			
	
			
				 (b)
			Demand that Borrower  (i) deposit cash with Bank in an amount equal to the amount of any Letters of Credit remaining undrawn, as collateral security for the repayment of any future drawings under such Letters of Credit, and (ii) pay in advance all Letter of Credit fees scheduled to be paid or payable over the remaining term of the Letters of Credit, and Borrower shall promptly deposit and pay such amounts;

			
	
			
				 (c)
			Cease advancing money or extending credit to or for the benefit of Borrower under this Agreement or under any other agreement between Borrower and Bank;

			
	
			
				 (d)
			Settle or adjust disputes and claims directly with account debtors for amounts, upon terms and in whatever order that Bank reasonably considers advisable;

			
	
			
				 (e)
			Make such payments and do such acts as Bank considers necessary or reasonable to protect its security interest in the Collateral.  Borrower agrees to assemble the Collateral if Bank so requires, and to make the Collateral available to Bank as Bank may designate.  Borrower authorizes Bank to enter the premises where the Collateral is located, to take and maintain possession of the Collateral, or any part of it, and to pay, purchase, contest, or compromise any encumbrance, charge, or lien which in Bank’s determination appears to be prior or superior to its security interest and to pay all expenses incurred in connection therewith.  With respect to any of Borrower’s owned premises, Borrower hereby grants Bank a license to enter into 

		 

		

			17.

		

 

		

			 

		

	possession of such premises and to occupy the same, without charge, in order to exercise any of Bank’s rights or remedies provided herein, at law, in equity, or otherwise;

			
	
			
				 (f)
			place a “hold” on any account maintained with Bank and/or deliver a notice of exclusive control, any entitlement order, or other directions or instructions pursuant to any control agreement or similar agreements providing control of any Collateral;

			
	
			
				 (g)
			Set off and apply to the Obligations any and all (i) balances and deposits of Borrower held by Bank, and (ii) indebtedness at any time owing to or for the credit or the account of Borrower held by Bank;

			
	
			
				 (h)
			Ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell (in the manner provided for herein) the Collateral.  Bank is hereby granted a license or other right, solely pursuant to the provisions of this Section 9.1, to use, without charge, Borrower’s labels, patents, copyrights, rights of use of any name, trade secrets, trade names, trademarks, service marks, and advertising matter, or any property of a similar nature, as it pertains to the Collateral, in completing production of, advertising for sale, and selling any Collateral and, in connection with Bank’s exercise of its rights under this Section 9.1, Borrower’s rights under all licenses and all franchise agreements shall inure to Bank’s benefit;

			
	
			
				 (i)
			Sell the Collateral at either a public or private sale, or both, by way of one or more contracts or transactions, for cash or on terms, in such manner and at such places (including Borrower’s premises) as Bank determines is commercially reasonable, and apply any proceeds to the Obligations in whatever manner or order Bank deems appropriate.  Bank may sell the Collateral without giving any warranties as to the Collateral.  Bank may specifically disclaim any warranties of title or the like.  This procedure will not be considered adversely to affect the commercial reasonableness of any sale of the Collateral.  If Bank sells any of the Collateral upon credit, Borrower will be credited only with payments actually made by the purchaser, received by Bank, and applied to the indebtedness of the purchaser.  If the purchaser fails to pay for the Collateral, Bank may resell the Collateral and Borrower shall be credited with the proceeds of the sale;

			
	
			
				 (j)
			Bank may credit bid and purchase at any public sale; 

			
	
			
				 (k)
			Apply for the appointment of a receiver, trustee, liquidator or conservator of the Collateral, without notice and without regard to the adequacy of the security for the Obligations and without regard to the solvency of Borrower, any guarantor or any other Person liable for any of the Obligations; and

			
	
			
				 (l)
			Any deficiency that exists after disposition of the Collateral as provided above will be paid immediately by Borrower.

		
			Bank may comply with any applicable state or federal law requirements in connection with a disposition of the Collateral and compliance will not be considered adversely to affect the commercial reasonableness of any sale of the Collateral.
		

			
	
			
				 9.2
			Power of Attorney.  Effective only upon the occurrence and during the continuance of an Event of Default, Borrower hereby irrevocably appoints Bank (and any of 

		 

		

			18.

		

 

		

			 

		

	Bank’s designated officers, or employees) as Borrower’s true and lawful attorney to:  (a) send requests for verification of Accounts or notify account debtors of Bank’s security interest in the Accounts; (b) endorse Borrower’s name on any checks or other forms of payment or security that may come into Bank’s possession; (c) sign Borrower’s name on any invoice or bill of lading relating to any Account, drafts against account debtors, schedules and assignments of Accounts, verifications of Accounts, and notices to account debtors; (d) dispose of any Collateral; (e) make, settle, and adjust all claims under and decisions with respect to Borrower’s policies of insurance; (f) settle and adjust disputes and claims respecting the accounts directly with account debtors, for amounts and upon terms which Bank determines to be reasonable; and (g) file, in its sole discretion, one or more financing or continuation statements and amendments thereto, relative to any of the Collateral; provided Bank may exercise such power of attorney to sign the name of Borrower on any of the documents described in clause (g) above, regardless of whether an Event of Default has occurred.  The appointment of Bank as Borrower’s attorney in fact, and each and every one of Bank’s rights and powers, being coupled with an interest, is irrevocable until all of the Obligations (other than inchoate indemnity obligations) have been fully repaid and performed and Bank’s obligation to provide advances hereunder is terminated.

			
	
			
				 9.3
			Accounts Collection.  At any time after the occurrence and during the continuation of an Event of Default, Bank may notify any Person owing funds to Borrower of Bank’s security interest in such funds and verify the amount of such Account.  Borrower shall collect all amounts owing to Borrower for Bank, receive in trust all payments as Bank’s trustee, and immediately deliver such payments to Bank in their original form as received from the account debtor, with proper endorsements for deposit.

			
	
			
				 9.4
			Bank Expenses.  If Borrower fails to pay any amounts or furnish any required proof of payment due to third persons or entities, as required under the terms of this Agreement, then Bank may do any or all of the following after reasonable notice to Borrower:  (a) make payment of the same or any part thereof; and/or (b) obtain and maintain insurance policies of the type discussed in Section 6.5 of this Agreement, and take any action with respect to such policies as Bank deems prudent.  Any amounts so paid or deposited by Bank shall constitute Bank Expenses, shall be immediately due and payable, and shall bear interest at the then applicable rate hereinabove provided, and shall be secured by the Collateral.  Any payments made by Bank shall not constitute an agreement by Bank to make similar payments in the future or a waiver by Bank of any Event of Default under this Agreement.

			
	
			
				 9.5
			Bank’s Liability for Collateral.  Bank has no obligation to clean up or otherwise prepare the Collateral for sale.  All risk of loss, damage or destruction of the Collateral shall be borne by Borrower.

			
	
			
				 9.6
			No Obligation to Pursue Others.  Bank has no obligation to attempt to satisfy the Obligations by collecting them from any other person liable for them and Bank may release, modify or waive any collateral provided by any other Person to secure any of the Obligations, all without affecting Bank’s rights against Borrower.  Borrower waives any right it may have to require Bank to pursue any other Person for any of the Obligations.

			
	
			
				 9.7
			Remedies Cumulative.  Bank’s rights and remedies under this Agreement, the Loan Documents, and all other agreements shall be cumulative.  Bank shall have all other rights 

		 

		

			19.

		

 

		

			 

		

	and remedies not inconsistent herewith as provided under the Code, by law, or in equity.  No exercise by Bank of one right or remedy shall be deemed an election, and no waiver by Bank of any Event of Default on Borrower’s part shall be deemed a continuing waiver.  No delay by Bank shall constitute a waiver, election, or acquiescence by it.  No waiver by Bank shall be effective unless made in a written document signed on behalf of Bank and then shall be effective only in the specific instance and for the specific purpose for which it was given.  Borrower expressly agrees that this Section 9.7 may not be waived or modified by Bank by course of performance, conduct, estoppel or otherwise.

			
	
			
				 9.8
			Demand; Protest.  Except as otherwise provided in this Agreement, Borrower waives demand, protest, notice of protest, notice of default or dishonor, notice of payment and nonpayment and any other notices relating to the Obligations.

			
	
			
				 10.
			NOTICES.

		
			Unless otherwise provided in this Agreement, all notices or demands by any party relating to this Agreement or any other agreement entered into in connection herewith shall be in writing and (except for financial statements and other reporting required pursuant to Section 6.2 of this Agreement, which shall be sent as directed in the monthly reporting forms provided by Bank) shall be personally delivered or sent by a recognized overnight delivery service, certified mail, postage prepaid, return receipt requested, or by telefacsimile or electronic mail to Borrower or to Bank, as the case may be, at its addresses set forth below:
		

		
			If to Borrower:LIQUIDIA TECHNOLOGIES, INC.
419 Davis Drive, Suite 100
Morrisville, North Carolina 27560-6837
Attn: In-house Counsel
FAX: (919)  328-4402
		

		
			If to Bank:Pacific Western Bank
		

		
			406 Blackwell Street, Suite 240
		

		
			Durham, North Carolina 27701
		

		
			Attn: Loan Operations Manager
		

		
			FAX: (919) 314-3080
E-Mail: loannotices@square1bank.com
		

		
			with a copy to:Pacific Western Bank
406 Blackwell Street, Suite 240
Durham, North Carolina 27701
Attn: Mara Huntington

FAX: (919) 314-3090
		

		
			The parties hereto may change the address at which they are to receive notices hereunder, by notice in writing in the foregoing manner given to the other.
		

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

		
			

		 

		

			20.

		

 

		

			 

		

		

		
			This Agreement shall be governed by, and construed in accordance with, the internal laws of the State of North Carolina, without regard to principles of conflicts of law.  Jurisdiction shall lie in the State of North Carolina.  All disputes, controversies, claims, actions and similar proceedings arising with respect to Borrower’s account or any related agreement or transaction shall be brought in the General Court of Justice of North Carolina sitting in Durham County, North Carolina or the United States District Court for the Middle District of North Carolina, except as provided below with respect to arbitration of such matters.  BANK AND BORROWER EACH ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY IS A CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED.  EACH OF THEM, AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT, WITH COUNSEL OF THEIR CHOICE, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY RELATED INSTRUMENT OR LOAN DOCUMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY COURSE OF CONDUCT, DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTION OF ANY OF THEM.  THESE PROVISIONS SHALL NOT BE DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR RELINQUISHED BY BANK OR BORROWER, EXCEPT BY A WRITTEN INSTRUMENT EXECUTED BY EACH OF THEM.    If the jury waiver set forth in this Section 11 is not enforceable, then any dispute, controversy, claim, action or similar proceeding arising out of or relating to this Agreement, the Loan Documents or any of the transactions contemplated therein shall be settled by final and binding arbitration held in Durham County, North Carolina  in accordance with the then current Commercial Arbitration Rules of the American Arbitration Association by one arbitrator appointed in accordance with those rules.  The arbitrator shall apply North Carolina law to the resolution of any dispute, without reference to rules of conflicts of law or rules of statutory arbitration. Judgment upon any award resulting from arbitration may be entered into and enforced by any state or federal court having jurisdiction thereof.  Notwithstanding the foregoing, the parties may apply to any court of competent jurisdiction for preliminary or interim equitable relief, or to compel arbitration in accordance with this Section.  The costs and expenses of the arbitration, including without limitation, the arbitrator’s fees and expert witness fees, and reasonable attorneys’ fees, incurred by the parties to the arbitration may be awarded to the prevailing party, in the discretion of the arbitrator, or may be apportioned between the parties in any manner deemed appropriate by the arbitrator.  Unless and until the arbitrator decides that one party is to pay for all (or a share) of such costs and expenses, both parties shall share equally in the payment of the arbitrator’s fees as and when billed by the arbitrator.
		

			
	
			
				 12.
			GENERAL PROVISIONS.

			
	
			
				 12.1
			Successors and Assigns.  This Agreement shall bind and inure to the benefit of the respective successors and permitted assigns of each of the parties and shall bind all persons who become bound as a debtor to this Agreement; provided, however, that neither this Agreement nor any rights hereunder may be assigned by Borrower without Bank’s prior written consent, which consent may be granted or withheld in Bank’s sole discretion.  Bank shall have the right without the consent of or notice to Borrower to sell, assign, transfer, negotiate, or grant participation in all or any part of, or any interest in, Bank’s obligations, rights and benefits hereunder.

		
			

		 

		

			21.

		

 

		

			 

		

		

			
	
			
				 12.2
			Indemnification.  Borrower shall defend, indemnify and hold harmless Bank and its officers, directors, employees, affiliates, advisors and agents (each, an “Indemnified Party”) against:  (a) all obligations, demands, claims, and liabilities claimed or asserted by any other party in connection with the transactions contemplated by this Agreement; and (b) all losses or Bank Expenses in any way suffered, incurred, or paid by Bank, its officers, employees and agents as a result of or in any way arising out of, following, or consequential to transactions between Bank and Borrower whether under this Agreement, or otherwise (including without limitation reasonable attorneys’ fees and expenses), except for losses, claims and Bank Expenses caused by an Indemnified Party’s gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and non-appealable order.

			
	
			
				 12.3
			Time of Essence.  Time is of the essence for the performance of all obligations set forth in this Agreement.

			
	
			
				 12.4
			Severability of Provisions.  Each provision of this Agreement shall be severable from every other provision of this Agreement for the purpose of determining the legal enforceability of any specific provision.

			
	
			
				 12.5
			Amendments in Writing, Integration.  All amendments to or terminations of this Agreement or the other Loan Documents must be in writing.  All prior agreements, understandings, representations, warranties, and negotiations between the parties hereto with respect to the subject matter of this Agreement and the other Loan Documents, if any, are merged into this Agreement and the Loan Documents.

			
	
			
				 12.6
			Counterparts.  This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement.  Executed copies of the signature pages of this Agreement sent by facsimile or transmitted electronically in Portable Document Format (“PDF”), or any similar format, shall be treated as originals, fully binding and with full legal force and effect, and the parties waive any rights they may have to object to such treatment.

			
	
			
				 12.7
			Survival.  All covenants, representations and warranties made in this Agreement shall continue in full force and effect so long as any Obligations remain outstanding or Bank has any obligation to make any Credit Extension to Borrower.  The obligations of Borrower to indemnify Bank with respect to the expenses, damages, losses, costs and liabilities described in Section 12.2 shall survive until all applicable statute of limitations periods with respect to actions that may be brought against Bank have run.

			
	
			
				 12.8
			Confidentiality and Publicity.  

			
	
			
				 (a)
			Borrower shall not, and shall not permit any of its Affiliates to:  (i) publish or disclose any materials containing Bank’s name, including in any press release or otherwise in connection with any advertising or marketing, without first obtaining Bank’s prior written consent, or (ii)  use Bank’s name (or the name of any of its Affiliates) in connection with its operations or business.  

		
			

		 

		

			22.

		

 

		

			 

		

		

			
	
			
				 (b)
			In handling any confidential information, Bank shall exercise commercially reasonable efforts to maintain in confidence, in accordance with its customary procedures for handling confidential information, all written non-public information furnished to Bank on a confidential basis clearly identified at the time of delivery as such (“Confidential Information”) other than any such Confidential Information that becomes generally available to the public or becomes available to the Bank from a source other than Borrower and that is not known to Bank to be subject to confidentiality obligations; provided, that Bank and its Affiliates shall have the right to disclose Confidential Information to: (i) such Person’s Affiliates; (ii) such Person or such Person’s Affiliates’ lenders, funding sources, or financing sources; (iii) such Person’s or such Person’s Affiliates’ directors, officers, trustees, partners, members, managers, employees, agents, advisors, representatives, attorneys, equity owners, professional consultants, portfolio management services and rating agencies; (iv) any successor or assign of Bank; (v) any Person to whom Bank offers to sell, assign or transfer any Credit Extension or any part thereof or any interest or participation therein; (vi) any Person that provides statistical analysis and/or information services to Bank or its Affiliates; and (vii) any Person (A) to the extent required by it by law, (B)  as may be required in connection with the examination, audit, or similar investigation of Bank, (C)  in response to any subpoena or other legal process or informal investigative demand, (D) in connection with any litigation, or (E) in connection with the actual or potential exercise or enforcement of any right or remedy under any Loan Document.  The obligations of Bank and its Affiliates under this Section 12.8 shall supersede and replace any other confidentiality obligations agreed to by Bank or its Affiliates. 

		
			12.9No Novation.  Nothing contained herein shall in any way impair the Prior Loan Agreement and the other Loan Documents now held for the Obligations, nor affect or impair any rights, powers, or remedies under the Prior Loan Agreement or any Loan Document, it being the intent of the parties hereto that this Agreement shall not constitute a novation of the Prior Loan Agreement or an accord and satisfaction of the Obligations.  Except as expressly provided for in this Agreement, the Loan Documents are hereby ratified and reaffirmed and shall remain in full force and effect.  Borrower hereby ratifies and reaffirms the validity and enforceability of all of the liens and security interests heretofore granted pursuant to the Loan Documents, as collateral security for the Obligations, and acknowledges that all of such liens and security interests, and all Collateral heretofore pledged as security for the Obligations, continues to be and remains in full force and effect as Collateral for the Obligations from and after the date of this Agreement.  Borrower and Bank acknowledge and agree that there are no known Events of Default that have occurred and are continuing as of the Closing Date; provided that the foregoing acknowledgement shall not be deemed to be a consent or waiver with respect to any Event of Default that may have occurred prior to the date hereof of which Bank is not currently aware, or which may hereafter occur, under the Prior Loan Agreement, this Agreement or any other Loan Document; nor shall the foregoing acknowledgement limit or impair in any way Bank’s rights and remedies with respect to any such Event of Default.
		

		
			

		 

		

			23.

		

 

		

			 

		

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first above written.
		

		
			 
		

		
			LIQUIDIA TECHNOLOGIES, INC.
		

		
			
		

		
			
		

		
			By: /s/ Timothy Albury
		

		
			
		

		
			Name: Timothy Albury
		

		
			
		

		
			Title: SVP and Chief Accounting Officer
		

		
			
		

		
			
		

		
			PACIFIC WESTERN BANK
		

		
			
		

		
			
		

		
			By: /s/ Lan Zhu
		

		
			
		

		
			Name: Lan Zhu
		

		
			 
		

		
			Title: Vice President
		

		
			
		

		
			 
		

		
			 
		

		
			

		 

		

			24.

		

 

		

			 

		

		

		
			EXHIBIT A
		

		
			DEFINITIONS
		

		
			 “Accounts” means all presently existing and hereafter arising accounts, contract rights, payment intangibles and all other forms of obligations owing to Borrower arising out of the sale or lease of goods (including, without limitation, the licensing of software and other technology) or the rendering of services by Borrower and any and all credit insurance, guaranties, and other security therefore, as well as all merchandise returned to or reclaimed by Borrower and Borrower’s Books relating to any of the foregoing.
		

		
			“Affiliate” means, with respect to any Person, any Person that owns or controls directly or indirectly such Person, any Person that controls or is controlled by or is under common control with such Person, and each of such Person’s senior executive officers, directors, and general partners.
		

		
			“Authorized Officer” means someone designated as such in the corporate resolution provided by Borrower to Bank in which this Agreement and the transactions contemplated hereunder are authorized by Borrower’s board of directors.  If Borrower provides subsequent corporate resolutions to Bank after the Closing Date, the individual(s) designated as “Authorized Officer(s)” in the most recently provided resolution shall be the only “Authorized Officers” for purposes of this Agreement.
		

		
			“Bank Expenses” means all reasonable costs or expenses (including reasonable attorneys’ fees and expenses, whether generated by in-house or by outside counsel) incurred in connection with the preparation, negotiation, administration, and enforcement of the Loan Documents;  reasonable Collateral audit fees; and Bank’s reasonable attorneys’ fees and expenses (whether generated in-house or by outside counsel) incurred in amending, enforcing or defending the Loan Documents (including fees and expenses of appeal), incurred before, during and after an Insolvency Proceeding, whether or not suit is brought.
		

		
			“Borrower’s Books” means all of Borrower’s books and records including:  ledgers; records concerning Borrower’s assets or liabilities, the Collateral, business operations or financial condition; and all computer programs, or tape files, and the equipment, containing such information.
		

		
			“Business Day” means any day that is not a Saturday, Sunday, or other day on which banks in the State of North Carolina are authorized or required to close.
		

		
			“Capitalized Expenditures” means current period unfinanced cash expenditures that are capitalized and amortized over a period of time in accordance with GAAP, including but not limited to unfinanced capitalized cash expenditures for capital equipment, unfinanced capitalized manufacturing and labor costs as they relate to inventory, and unfinanced capitalized cash expenditures for software development.
		

		
			“Cash” means unrestricted cash and cash equivalents.
		

		
			

		 

		

			1.

		

 

		

			 

		

		

		
			“Change in Control” shall mean a transaction other than a bona fide equity financing or series of financings on terms and from investors reasonably acceptable to Bank in which any “person” or “group” (within the meaning of Section 13(d) and 14(d)(2) of the Securities Exchange Act of 1934) becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly, of a sufficient number of shares of all classes of stock then outstanding of Borrower ordinarily entitled to vote in the election of directors, empowering such “person” or “group” to elect a majority of the Board of Directors of Borrower, who did not have such power before such transaction. 
		

		
			“Closing Date” means the date of this Agreement.
		

		
			“Code” means the North Carolina Uniform Commercial Code as amended or supplemented from time to time.
		

		
			“Collateral” means the property described on Exhibit B attached hereto and all Negotiable Collateral to the extent not described on Exhibit B, except to the extent any such property (i) is non-assignable by its terms without the consent of the licensor thereof or another party (but only to the extent such prohibition on transfer is enforceable under applicable law, including, without limitation, Sections §25-9-406 and §25-9-408 of the Code), (ii) the granting of a security interest therein is contrary to applicable law, provided that upon the cessation of any such restriction or prohibition, such property shall automatically become part of the Collateral, (iii) constitutes the capital stock of a controlled foreign corporation (as defined in the IRC), in excess of 65% of the voting power of all classes of capital stock of such controlled foreign corporations entitled to vote, or (iv) property (including any attachments, accessions or replacements) that is subject to a Lien that is permitted pursuant to clause (c) of the definition of Permitted Liens, if the grant of a security interest with respect to such property pursuant to this Agreement would be prohibited by the agreement creating such Permitted Lien or would otherwise constitute a default thereunder, provided, that such property will be deemed "Collateral" hereunder upon the termination and release of such Permitted Lien.
		

		
			 
		

		
			“Collateral State” means the state or states where the Collateral is located, which is North Carolina.  
		

		
			“Compliance Certificate” means a compliance certificate, in substantially the form of Exhibit D attached hereto, executed by a Responsible Officer of the Borrower.
		

		
			“Contingent Obligation” means, as applied to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect to (i) any indebtedness, lease, dividend, letter of credit or other obligation of another, including, without limitation, any such obligation directly or indirectly guaranteed, endorsed, co-made or discounted or sold with recourse by that Person, or in respect of which that Person is otherwise directly or indirectly liable; (ii) any obligations with respect to undrawn letters of credit, corporate credit cards or merchant services issued for the account of that Person; and (iii) all obligations arising under any interest rate, currency or commodity swap agreement, interest rate cap agreement, interest rate collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; provided, however, that the term “Contingent Obligation” shall not include endorsements for collection or deposit in the ordinary course of business.  The amount of any Contingent Obligation shall be deemed to be an amount equal to the 

		 

		

			2.

		

 

		

			 

		

stated or determined amount of the primary obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith; provided, however, that such amount shall not in any event exceed the maximum amount of the obligations under the guarantee or other support arrangement.
		

		
			“Conversion Date” is defined in Section 2.1(b)(ii).
		

		
			“Copyrights” means any and all copyright rights, copyright applications, copyright registrations and like protections in each work or authorship and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret, now or hereafter existing, created, acquired or held.
		

		
			“Credit Card Line” means a Credit Extension of up to $50,000, to be used exclusively for the provision of Credit Card Services.
		

		
			“Credit Card Maturity Date” means September 30, 2020.
		

		
			“Credit Card Services” is defined in Section 2.1(c)(ii).
		

		
			“Credit Extension” means each Term Loan, the Credit Card Services provided under the Credit Card Line, or any other extension of credit by Bank to or for the benefit of Borrower hereunder.
		

		
			“Equipment” means all present and future machinery, equipment, tenant improvements, furniture, fixtures, vehicles, tools, parts and attachments in which Borrower has any interest.
		

		
			“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and the regulations thereunder.
		

		
			“Event of Default” has the meaning assigned in Article ‎8.
		

		
			“Funding Milestone” means Borrower has, after the Closing Date and on or prior to October 31, 2019: (i) received at least Forty Million Dollars ($40,000,000) of aggregate gross Cash proceeds from the sale of New Equity or licensing of Borrower’s Intellectual Property, and (ii) completed public disclosure of the safety data analysis for LIQ-861 without any materially adverse data.
		

		
			“GAAP” means generally accepted accounting principles, consistently applied, as in effect from time to time in the United States.
		

		
			“Indebtedness” means (a) all indebtedness for borrowed money or the deferred purchase price of property or services, including without limitation reimbursement and other obligations with respect to surety bonds and letters of credit, (b) all obligations evidenced by notes, bonds, debentures or similar instruments, (c) all capital lease obligations, and (d) all Contingent Obligations, including but not limited to any sublimit contained herein.
		

		
			“Insolvency Proceeding” means any proceeding commenced by or against any Person or entity under any provision of the United States Bankruptcy Code, as amended, or under any other bankruptcy or insolvency law, including assignments for the benefit of creditors, formal or 

		 

		

			3.

		

 

		

			 

		

informal moratoria, compositions, extension generally with its creditors, or proceedings seeking reorganization, arrangement, or other relief.
		

		
			“Intellectual Property” means all of Borrower’s right, title, and interest in and to the following:
		

			
	
			
				 (a)
			Copyrights, Trademarks and Patents;

			
	
			
				 (b)
			Any and all trade secrets, and any and all intellectual property rights in computer software and computer software products now or hereafter existing, created, acquired or held;

			
	
			
				 (c)
			Any and all design rights which may be available to Borrower now or hereafter existing, created, acquired or held;

			
	
			
				 (d)
			Any and all claims for damages by way of past, present and future infringement of any of the rights included above, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the intellectual property rights identified above;

			
	
			
				 (e)
			All licenses or other rights to use any of the Copyrights, Patents or Trademarks, and all license fees and royalties arising from such use to the extent permitted by such license or rights; 

			
	
			
				 (f)
			All amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents; and

			
	
			
				 (g)
			All proceeds and products of the foregoing, including without limitation all payments under insurance or any indemnity or warranty payable in respect of any of the foregoing.

		
			“Interest-Only Extension Milestone” means Borrower has received, after the Closing Date and on or prior to October 31, 2019, at least Forty Million Dollars ($40,000,000) of aggregate gross Cash proceeds from the sale of New Equity or licensing of Borrower’s Intellectual Property.
		

		
			“Interest-Only Period” means the period commencing on the Closing Date and continuing through December 31, 2019; provided however, that if Borrower provides evidence reasonably satisfactory to Bank that Borrower has achieved the Interest-Only Extension Milestone, the Interest-Only Period shall be extended to June 30, 2020.
		

		
			“Inventory” means all present and future inventory in which Borrower has any interest.
		

		
			“Investment” means any beneficial ownership of (including stock, partnership or limited liability company interest or other securities) any Person, or any loan, advance or capital contribution to any Person.
		

		
			“Investment Agreement” means, collectively, Borrower’s stock purchase and other agreement(s) pursuant to which Borrower most recently issued its preferred stock.
		

		
			“IRC” means the Internal Revenue Code of 1986, as amended, and the regulations thereunder.
		

		
			“Letter of Credit” means a commercial or standby letter of credit or similar undertaking issued by Bank  (or any of its correspondent banks) at Borrower’s request.
		

		
			

		 

		

			4.

		

 

		

			 

		

		

		
			“Lien” means any mortgage, lien, deed of trust, charge, pledge, security interest or other encumbrance.
		

		
			“Liquidity Event” means Borrower has provided evidence reasonably acceptable to Bank that Borrower has received at least Forty Million Dollars ($40,000,000) of gross Cash proceeds from the sale of New Equity.
		

		
			“Loan Documents” means, collectively, this Agreement, any note or notes executed by Borrower, and any other document, instrument or agreement entered into in connection with this Agreement, all as amended or extended from time to time.
		

		
			“Long-Term Success Fee” is defined in Section 2.4(e).
		

		
			“Material Adverse Effect” means a material adverse effect on (i) the operations, business or financial condition of Borrower and its Subsidiaries taken as a whole, (ii) the ability of Borrower to repay the Obligations or otherwise perform its obligations under the Loan Documents, or (iii) Borrower’s interest in, or the value, perfection or priority of Bank’s security interest in the Collateral.
		

		
			“Minimum Cash Threshold” is defined in Section 6.7(a).
		

		
			“Near-Term Success Fee” is defined in Section 2.4(d).
		

		
			“Negotiable Collateral” means all of Borrower’s present and future letters of credit of which it is a beneficiary, drafts, instruments (including promissory notes), securities, documents of title, and chattel paper, and Borrower’s Books relating to any of the foregoing.
		

		
			“New Equity” means cash proceeds received after the Closing Date from the sale or issuance of Borrower’s equity securities to investors.
		

		
			“Obligations” means all debt, principal, interest, Bank Expenses and other amounts owed to Bank by Borrower pursuant to this Agreement or any other agreement, whether absolute or contingent, due or to become due, now existing or hereafter arising, including any interest that accrues after the commencement of an Insolvency Proceeding and including any debt, liability, or obligation owing from Borrower to others that Bank may have obtained by assignment or otherwise.
		

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

		
			“Performance Milestone” means, prior to June 30, 2019, Borrower has both (i) completed full enrollment of the LIQ-861 Phase 3 trial (LTI-301), and (ii) not observed any materially adverse data related to the safety of LIQ-861 through the two-week endpoint.
		

		
			“Periodic Payments” means all installments or similar recurring payments that Borrower may now or hereafter become obligated to pay to Bank pursuant to the terms and provisions of any instrument, or agreement now or hereafter in existence between Borrower and Bank.
		

		
			

		 

		

			5.

		

 

		

			 

		

		

		
			“Permitted Indebtedness” means:
		

			
	
			
				 (a)
			Indebtedness of Borrower in favor of Bank arising under this Agreement or any other Loan Document;

			
	
			
				 (b)
			Indebtedness existing on the Closing Date and disclosed in the Schedule;

			
	
			
				 (c)
			Indebtedness to not to exceed $3,500,000 in the aggregate at any time (including any amounts existing on the Closing Date and disclosed in the Schedule pursuant to clause (b) above) secured by a lien described in clause (c) of the defined term “Permitted Liens,” provided such Indebtedness does not exceed at the time it is incurred the lesser of the cost or fair market value of the property financed with such Indebtedness; 

			
	
			
				 (d)
			Subordinated Debt; 

			
	
			
				 (e)
			Indebtedness to trade creditors incurred in the ordinary course of business;  

			
	
			
				 (f)
			Indebtedness incurred in connection with the financing solely of director’s and officer’s insurance premiums in an aggregate amount at any time outstanding not to exceed the lesser of premiums owed under such policies or $650,000;  and 

			
	
			
				 (g)
			Extensions, refinancings and renewals of any items of Permitted Indebtedness, provided that the principal amount is not increased or the terms modified to impose more burdensome terms upon Borrower or its Subsidiary, as the case may be.

		
			“Permitted Investment” means:
		

			
	
			
				 (a)
			Investments existing on the Closing Date disclosed in the Schedule;

			
	
			
				 (b)
			(i) Marketable direct obligations issued or unconditionally guaranteed by the United States of America or any agency or any State thereof maturing within one year from the date of acquisition thereof, (ii) commercial paper maturing no more than one year from the date of creation thereof and currently having rating of at least A-2 or P-2 from either Standard & Poor’s Corporation or Moody’s Investors Service, (iii) Bank’s certificates of deposit maturing no more than one year from the date of investment therein, and (iv) Bank’s money market accounts; (v) Investments in regular deposit or checking accounts held with Bank or as otherwise permitted by, and subject to the terms and conditions of, Section 6.6 of this Agreement; and (vi) Investments consistent with any investment policy adopted by the Borrower’s board of directors;

			
	
			
				 (c)
			Investments accepted in connection with Permitted Transfers;

			
	
			
				 (d)
			Investments of Subsidiaries in or to other Subsidiaries or Borrower and Investments by Borrower in Subsidiaries not to exceed $250,000 in the aggregate in any fiscal year;

			
	
			
				 (e)
			Investments not to exceed $250,000 outstanding in the aggregate at any time consisting of (i) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business, and (ii) loans to employees, officers or directors relating to the purchase of equity securities of Borrower or its Subsidiaries pursuant to employee stock purchase 

		 

		

			6.

		

 

		

			 

		

	plan agreements approved by Borrower’s Board of Directors;

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

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

			
	
			
				 (h)
			Joint ventures or strategic alliances in the ordinary course of Borrower’s business consisting of the non-exclusive licensing of technology, the development of technology or the providing of technical support, provided that any cash Investments by Borrower do not exceed $500,000 in the aggregate in any fiscal year; and

			
	
			
				 (i)
			Investments permitted under Section 7.3.

		
			“Permitted Liens” means the following:
		

			
	
			
				 (a)
			Any Liens existing on the Closing Date and disclosed in the Schedule (excluding Liens to be satisfied with the proceeds of the Credit Extensions) or arising under this Agreement,  the other Loan Documents, or any other agreement in favor of Bank;

			
	
			
				 (b)
			Liens for taxes, fees, assessments or other governmental charges or levies, either not delinquent or being contested in good faith by appropriate proceedings and for which Borrower maintains adequate reserves;

			
	
			
				 (c)
			Liens not to exceed $3,500,000 in the aggregate (including any Liens existing on the Closing Date and disclosed in the Schedule pursuant to clause (a) above) at any time (i) upon or in any Equipment (other than Equipment financed by a Credit Extension) acquired or held by Borrower or any of its Subsidiaries to secure the purchase price of such Equipment or indebtedness incurred solely for the purpose of financing the acquisition or lease of such Equipment, or (ii) existing on such Equipment at the time of its acquisition, in each case provided that the Lien is confined solely to the property so acquired and improvements thereon, and the proceeds of such Equipment;

			
	
			
				 (d)
			Liens incurred in connection with the extension, renewal or refinancing of the indebtedness secured by Liens of the type described in clauses (a) through (c) above, provided that any extension, renewal or replacement Lien shall be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness being extended, renewed or refinanced does not increase; and

			
	
			
				 (e)
			Liens arising from judgments, decrees or attachments in circumstances not constituting an Event of Default under Sections 8.4 (attachment) or 8.8 (judgments);

			
	
			
				 (f)
			Liens securing Subordinated Debt, provided that such Liens do not encumber assets beyond those assets comprising the Collateral;  

		
			

		 

		

			7.

		

 

		

			 

		

		

			
	
			
				 (g)
			Liens to secure the payment of worker's compensation, employment insurance, old-age pensions, social security and other like obligations incurred in the ordinary course of business (other than Liens imposed by ERISA), provided that the aggregate of all such Liens shall not exceed $250,000 at any time; and

		
			(h)Leases or subleases of real property granted in the ordinary course of business (or, if referring to another Person, in the ordinary course of such Person's business), and leases, subleases, non-exclusive licenses of personal property (other than Intellectual Property) granted in the ordinary course of business which (i) do not interfere in any material respect with the business of Borrower and its Subsidiaries, (ii) do not secure any Indebtedness, and (iii) are not otherwise prohibited by this Agreement.
		

		
			“Permitted Transfer” means the conveyance, sale, lease, transfer or disposition by Borrower or any Subsidiary of:  
		

			
	
			
				 (a)
			Inventory in the ordinary course of business; 

			
	
			
				 (b)
			licenses and similar arrangements for the use of the property of Borrower or its Subsidiaries in the ordinary course of business; 

			
	
			
				 (c)
			worn-out, surplus or obsolete Equipment;  

			
	
			
				 (d)
			grants of security interests and other Liens that constitute Permitted Liens; and

			
	
			
				 (e)
			other assets of Borrower or its Subsidiaries that do not in the aggregate exceed $250,000 during any fiscal year.

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

		
			“Prepayment Fee” is defined in Section 2.4(c).
		

		
			“Prime Rate” means the variable rate of interest, per annum, most recently announced by Bank, as its “prime rate,” whether or not such announced rate is the lowest rate available from Bank; provided that, in the event such rate of interest is less than zero percent (0.00%), such rate shall be deemed to be zero percent (0.00%) for purposes of this Agreement.
		

		
			“Prior Loan Agreement” is defined in the recitals to this Agreement.
		

		
			“Repayment Period” is the period commencing on the Conversion Date and continuing through the Term Loan Maturity Date.
		

		
			“Responsible Officer” means each of the Chief Executive Officer, the Chief Operating Officer  (if any), the Chief Financial Officer, Vice President of Finance and the Controller of Borrower, as well as any other officer or employee identified as an Authorized Officer in the corporate resolution delivered by Borrower to Bank in connection with this Agreement.
		

		
			

		 

		

			8.

		

 

		

			 

		

		

		
			“Schedule” means the schedule of exceptions attached hereto and approved by Bank, if any.
		

		
			“SOS Reports” means the official reports from the Secretaries of State of each Collateral State, the state where Borrower’s chief executive office is located, the state of Borrower’s formation and other applicable federal, state or local government offices identifying all current security interests filed in the Collateral and Liens of record as of the date of such report.
		

		
			“Subordinated Debt” means any debt incurred by Borrower that is subordinated in writing to the debt owing by Borrower to Bank on terms reasonably acceptable to Bank (and identified as being such by Borrower and Bank).
		

		
			“Subsidiary” means any corporation, partnership or limited liability company or joint venture in which (i) any general partnership interest or (ii) more than 50% of the stock, limited liability company interest or joint venture of which by the terms thereof ordinary voting power to elect the Board of Directors, managers or trustees of the entity, at the time as of which any determination is being made, is owned by Borrower, either directly or through an Affiliate.
		

		
			“Term Loan Maturity Date” means the date occurring four (4) years after the Closing Date.
		

		
			“Trademarks” means any trademark and servicemark rights, whether registered or not, applications to register and registrations of the same and like protections, and the entire goodwill of the business of Borrower connected with and symbolized by such trademarks.
		

		
			“Tranche” means any of Tranche A or Tranche B.
		

		
			“Tranche A” has the meaning assigned in Section 2.1(b)(i).
		

		
			“Tranche B” has the meaning assigned in Section 2.1(b)(i).
		

		
			“Tranche A Term Loan” means the Term Loan made under Tranche A.
		

		
			“Tranche B Term Loan” or “Tranche B Term Loans” means any Term Loan(s) made under Tranche B.
		

		
			“Tranche B Availability End Date” means June 30, 2019.
		

		
			“UNC Debt” means Indebtedness of the Borrower to the University of North Carolina at Chapel Hill, such Indebtedness being unsecured and not evidenced by a promissory note.
		

		
			 
		

		
			 
		

		
			

		 

		

			9.

		

 

		

			 

		

		

		
			DEBTORLIQUIDIA TECHNOLOGIES, INC.
		

		
			SECURED PARTY:PACIFIC WESTERN BANK
		

		
			EXHIBIT B
		

		
			COLLATERAL DESCRIPTION ATTACHMENT TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
		

		
			All personal property of Borrower (herein referred to as “Borrower” or “Debtor”) whether presently existing or hereafter created or acquired, and wherever located, including, but not limited to:
		

			
	
			
				 (a)
			all accounts (including health-care-insurance receivables), chattel paper (including tangible and electronic chattel paper), deposit accounts, documents (including negotiable documents), equipment (including all accessions and additions thereto), financial assets, general intangibles (including patents, trademarks, copyrights, goodwill, payment intangibles, domain names and software), goods (including fixtures), instruments (including promissory notes), inventory (including all goods held for sale or lease or to be furnished under a contract of service, and including returns and repossessions), investment property (including securities and securities entitlements), letter of credit rights, money, and all of Debtor’s books and records with respect to any of the foregoing, and the computers and equipment containing said books and records; 

			
	
			
				 (b)
			any and all cash proceeds and/or noncash proceeds of any of the foregoing, including, without limitation, insurance proceeds, and all supporting obligations and the security therefor or for any right to payment.  All terms above have the meanings given to them in the North Carolina Uniform Commercial Code, as amended or supplemented from time to time, including revised Division 9 of the Uniform Commercial Code-Secured Transactions.

		
			Notwithstanding the foregoing, the Collateral shall not include any of the intellectual property, in any medium, of any kind or nature whatsoever, now or hereafter owned or acquired or received by Borrower, or in which Borrower now holds or hereafter acquires or receives any right or interest (collectively, the “Intellectual Property”); provided, however, that the Collateral shall include all accounts and general intangibles that consist of rights to payment and proceeds from the sale, licensing or disposition of all or any part, or rights in, the foregoing (the “Rights to Payment”).  
		

		
			Notwithstanding the foregoing, if a judicial authority (including a U.S. Bankruptcy Court) holds that a security interest in the underlying Intellectual Property is necessary to have a security interest in the Rights to Payment, then the Collateral shall automatically, and effective as of January 6, 2016 include the Intellectual Property to the extent and only to the extent necessary to permit perfection of Bank’s security interest in the Rights to Payment, and further provided, however, that Bank’s enforcement rights with respect to any security interest in the Intellectual Property shall be absolutely limited to the Rights to Payment only, and Bank shall have no recourse whatsoever with respect to the underlying Intellectual Property.
		

		
			

		 

		

			1.

		

 

		

			 

		

EXHIBIT C
		

		
			LOAN ADVANCE/PAYDOWN REQUEST FORM
		

		
			[Please refer to New Borrower Kit]
		

		
			 
		

		
			EXHIBIT D
		

		
			COMPLIANCE CERTIFICATE
		

		
			[Please refer to New Borrower Kit]
		

		
			 
		

		 

		

			2.Exhibit

Exhibit 10.3 
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT, dated as of October 29, 2018 (this “Amendment”), is entered into among Coeur Mining, Inc., a Delaware corporation (the “Borrower”), the Guarantors, the Lenders party hereto and Bank of America, N.A., as Administrative Agent (in such capacity, the “Administrative Agent”).  Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Credit Agreement (as defined below and as amended by this Amendment).
RECITALS
A.    The Borrower, the Guarantors, the Lenders and the Administrative Agent entered into that certain Credit Agreement, dated as of September 29, 2017 (as previously amended, restated, supplemented or otherwise modified, the “Credit Agreement”).
B.    The parties hereto have agreed to amend the Credit Agreement as provided herein.
C.    In consideration of the agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows.
AGREEMENT
1.    Amendments.
(a)    The following definitions in Section 1.01 of the Credit Agreement are hereby amended to read as follows:
“Aggregate Revolving Commitments” means the Revolving Commitments of all the Lenders.  The amount of the Aggregate Revolving Commitments in effect on the First Amendment Effective Date is $250,000,000.
“Maturity Date” means October 29, 2022; provided, however, that if such date is not a Business Day, the Maturity Date shall be the next preceding Business Day.
(b)    The following definitions are hereby added to Section 1.01 of the Credit Agreement in the appropriate alphabetical order to read as follows:
“Beneficial Ownership Certification” means a certification regarding beneficial ownership required by the Beneficial Ownership Regulation.
“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.
“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in and subject to Section 4975 of the Internal Revenue Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the Internal Revenue Code) the assets of any such “employee benefit plan” or “plan”.
“First Amendment Effective Date” means October 29, 2018.

“LIBOR Screen Rate” means the LIBOR quote on the applicable screen page the Administrative Agent designates to determine LIBOR (or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time).
“LIBOR Successor Rate” has the meaning specified in Section 3.07.
“LIBOR Successor Rate Conforming Changes” means, with respect to any proposed LIBOR Successor Rate, any conforming changes to the definition of Base Rate, Interest Period, timing and frequency of determining rates and making payments of interest and other administrative matters as may be appropriate, in the discretion of the Administrative Agent in consultation with the Borrower, to reflect the adoption of such LIBOR Successor Rate and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent determines that adoption of any portion of such market practice is not administratively feasible or that no market practice for the administration of such LIBOR Successor Rate exists, in such other manner of administration as the Administrative Agent determines is reasonably necessary in connection with the administration of this Agreement).
“PTE” means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.
“Scheduled Unavailability Date” has the meaning specified in Section 3.07.
(c)    Clause (a) of Section 2.16 of the Credit Agreement is hereby amended to read as follows:
(a)    after the First Amendment Effective Date, the aggregate amount of all Incremental Revolving Commitments and Incremental Term Loans effected pursuant to this Section 2.16 shall not exceed $50,000,000;

(d)    Section 3.07 of the Credit Agreement is hereby renumbered Section 3.08, and a new Section 3.07 is hereby added to the Credit Agreement to read as follows:
3.07    Successor LIBOR.
Notwithstanding anything to the contrary in this Agreement or any other Loan Documents (including Section 11.01 hereof), if the Administrative Agent determines (which determination shall be conclusive absent manifest error), or the Borrower or Required Lenders notify the Administrative Agent (with, in the case of the Required Lenders, a copy to Borrower) that the Borrower or Required Lenders (as applicable) have determined, that:
(a)    adequate and reasonable means do not exist for ascertaining LIBOR for any requested Interest Period because the LIBOR Screen Rate is not available or published on a current basis and such circumstances are unlikely to be temporary, or
(b)    the administrator of the LIBOR Screen Rate or a Governmental Authority having jurisdiction over the Administrative Agent has made a public statement identifying a specific date after which LIBOR or the LIBOR Screen Rate shall no longer be made available, or used for determining the interest rate of loans (such specific date, the “Scheduled Unavailability Date”), or

2

(c)    syndicated loans currently being executed, or that include language similar to that contained in this Section, are being executed or amended (as applicable) to incorporate or adopt a new benchmark interest rate to replace LIBOR,
then, reasonably promptly after such determination by the Administrative Agent or receipt by the Administrative Agent of such notice, as applicable,  the Administrative Agent and the Borrower may amend this Agreement to replace LIBOR with an alternate benchmark rate (including any mathematical or other adjustments to the benchmark (if any) incorporated therein), giving due consideration to any evolving or then existing convention for similar Dollar denominated syndicated credit facilities for such alternative benchmarks (any such proposed rate, a “LIBOR Successor Rate”), together with any proposed LIBOR Successor Rate Conforming Changes and any such amendment shall become effective at 5:00 p.m. on the fifth Business Day after the Administrative Agent shall have posted such proposed amendment to all Lenders and the Borrower unless, prior to such time, Lenders comprising the Required Lenders have delivered to the Administrative Agent written notice that such Required Lenders do not accept such amendment.  Such LIBOR Successor Rate shall be applied in a manner consistent with market practice; provided that to the extent such market practice is not administratively feasible for the Administrative Agent, such LIBOR Successor Rate shall be applied in a manner as otherwise reasonably determined by the Administrative Agent.
If no LIBOR Successor Rate has been determined and the circumstances under clause (a) above exist or the Scheduled Unavailability Date has occurred (as applicable), the Administrative Agent will promptly so notify the Borrower and each Lender.  Thereafter, (x) the obligation of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended, (to the extent of the affected Eurodollar Rate Loans or Interest Periods), and (y) the Eurodollar Rate component shall no longer be utilized in determining the Base Rate.  Upon receipt of such notice, the Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate Loans (to the extent of the affected Eurodollar Rate Loans or Interest Periods) or, failing that, will be deemed to have converted such request into a request for a Borrowing of Base Rate Loans (subject to the foregoing clause (y)) in the amount specified therein.
Notwithstanding anything else herein, any definition of LIBOR Successor Rate shall provide that in no event shall such LIBOR Successor Rate be less than zero for purposes of this Agreement.
(e)    A new clause (f) is hereby added to Section 5.12 of the Credit Agreement to read as follows:
(f)    The Borrower represents and warrants as of the First Amendment Effective Date that the Borrower is not and will not be using “plan assets” (within the meaning of 29 CFR § 2510.3-101, as modified by Section 3(42) of ERISA or otherwise) of one or more Benefit Plans in connection with the Loans, the Letters of Credit or the Commitments.
(f)    Section 5.15 of the Credit Agreement is hereby amended by adding the following text at the end of such section:
As of the First Amendment Effective Date, the information included in the Beneficial Ownership Certification (if required) is true and correct in all respects.

(g)    In Section 6.02 of the Credit Agreement, (i) the “; and” at the end of clause (g) is hereby amended to read “;”, (ii) the “.” at the end of clause (h) is hereby amended to read “; and” and (iii) a new clause (i) is hereby added to read as follows:

3

(i)    promptly following any request therefor, information and documentation reasonably requested by the Administrative Agent or any Lender for purposes of compliance with applicable “know your customer” and anti-money-laundering rules and regulations, including, without limitation, the PATRIOT Act and the Beneficial Ownership Regulation.
(h)    Section 6.16 of the Credit Agreement is hereby amended by adding the following text as a new paragraph at the end of such section:
To the extent not delivered on the First Amendment Effective Date, within sixty (60) days following the First Amendment Effective Date (or such later date as the Administrative Agent shall agree in its sole discretion), deliver to the Administrative Agent amendments to the Mortgages in effect on the First Amendment Effective Date, together with endorsements and updates to the applicable ALTA mortgagee title insurance policies, opinions of legal counsel and such other Real Property Security Documents reasonably requested by the Administrative Agent, in each case in form and substance reasonably acceptable to the Administrative Agent.

(i)    A new Section 9.12 is hereby added to Article IX of the Credit Agreement to read as follows:
9.12    ERISA Matters.
(a)     Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and the Arranger and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that at least one of the following is and will be true:
(i)    such Lender is not using “plan assets” (within the meaning of Section 3(42) of ERISA or otherwise) of one or more Benefit Plans in connection with the Loans, the Letters of Credit or the Commitments,
(ii)    the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement,
(iii)    (A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Letters of Credit, the Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of 

4

such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement, or
(iv)    such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole discretion, and such Lender.
(b)    In addition, unless either (i) sub-clause in the immediately preceding clause (a) is true with respect to a Lender or (ii) a Lender has provided another representation, warranty and covenant in accordance with sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and the Arranger and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that none of the Administrative Agent or the Arranger or any of their respective Affiliates is a fiduciary with respect to the assets of such Lender involved in the Loans, the Letters of Credit, the Commitments and this Agreement (including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related to hereto or thereto).
(j)    The second proviso in Section 11.01 of the Credit Agreement is hereby amended to read as follows:
provided, further, that notwithstanding anything to the contrary herein, (i) the Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto, (ii) each Lender is entitled to vote as such Lender sees fit on any bankruptcy reorganization plan that affects the Loans, and each Lender acknowledges that the provisions of Section 1126(c) of the Bankruptcy Code of the United States supersedes the unanimous consent provisions set forth herein, (iii) the Required Lenders shall determine whether or not to allow a Loan Party to use cash collateral in the context of a bankruptcy or insolvency proceeding and such determination shall be binding on all of the Lenders, (iv) Incremental Facility Amendments may be effected in accordance with Section 2.16, (v) Extension Amendments may be effected in accordance with Section 2.17 and (vi) the Administrative Agent and the Borrower may make amendments contemplated by Section 3.07.
(k)    Schedule 2.01 of the Credit Agreement is hereby amended to read as attached as Schedule 2.01 hereto.
2.    Effectiveness; Conditions Precedent.  This Amendment shall be effective as of the date hereof when all of the conditions set forth in this Section 2 shall have been satisfied in form and substance reasonably satisfactory to the Administrative Agent.
(a)    Execution and Delivery of Amendment.  The Administrative Agent shall have received copies of this Amendment duly executed by the Loan Parties, each Lender and the Administrative Agent.
(b)    Opinion of Counsel. The Administrative Agent shall have received a favorable opinion of legal counsel (including appropriate local counsel) to the Loan Parties, addressed to the 

5

Administrative Agent and each Lender, dated as of the date hereof, in form and substance reasonably satisfactory to the Administrative Agent.
(c)    Organization Documents, Resolutions, Etc.  The Administrative Agent shall have received the following, each in form and substance reasonably satisfactory to the Administrative Agent:
(i)    copies of the Organization Documents of each Loan Party certified to be true and complete as of a recent date by the appropriate Governmental Authority of the state or other jurisdiction of its incorporation or organization, where applicable, and certified by a secretary or assistant secretary of such Loan Party to be true and correct as of the date hereof, or a certification that no change has been made to the Organization Documents since the Closing Date;
(ii)    such certificates of resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of each Loan Party as the Administrative Agent may require evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Amendment; and
(iii)    such documents and certifications as the Administrative Agent may reasonably require to evidence that each Loan Party is duly organized or formed, and is validly existing, in good standing and qualified to engage in business in its state of organization or formation.
(d)    KYC Information.
(i)    Upon the reasonable request of any Lender made at least ten days prior to the date hereof, the Borrower shall have provided to such Lender the documentation and other information so requested in connection with applicable “know your customer” and anti-money-laundering rules and regulations, including the PATRIOT Act, in each case at least five days prior to the date hereof.
(ii)    At least five days prior to the date hereof, if the Borrower qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, it shall deliver a Beneficial Ownership Certification in relation to the Borrower.
(e)    Lender Fees.  The Borrower shall have paid to the Administrative Agent for the account of each Lender the agreed amendment fees.
(f)    Fees and Expenses.  The Borrower shall have paid all fees and expenses owed by the Borrower to the Administrative Agent and the Arranger including all reasonable and documented fees, charges and disbursements of counsel to the Administrative Agent or the Arranger (directly to such counsel if requested by the Administrative Agent or the Arranger) to the extent payable pursuant to the Loan Documents and invoiced prior to or on the date hereof, plus such additional amounts of such fees, charges and disbursements as shall constitute its reasonable estimate of such fees, charges and disbursements incurred or to be incurred by it through the date hereof (provided that such estimate shall not thereafter preclude a final settling of accounts between the Borrower and the Administrative Agent or the Arranger).

6

3.    Ratification of Credit Agreement.  Each Loan Party acknowledges and consents to the terms set forth herein and agrees that this Amendment does not impair, reduce or limit any of its obligations under the Loan Documents.  This Amendment is a Loan Document.
4.    Authority/Enforceability.  Each Loan Party represents and warrants as follows:
(a)    It has taken all necessary action to authorize the execution, delivery and performance of this Amendment.
(b)    This Amendment has been duly executed and delivered by such Loan Party and constitutes its legal, valid and binding obligation, enforceable in accordance with its terms, except as such enforceability may be limited by applicable Debtor Relief Laws and the availability of equitable remedies.
(c)    No approval, consent, exemption, authorization or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against, such Loan Party of this Amendment, other than (i) those that have already been obtained and are in full force and effect and (ii) those for which the failure to obtain or make could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(d)    The execution, delivery and performance by such Loan Party of this Amendment do not (i) contravene the terms of its Organization Documents or (ii) violate any Law, except in each case as could not reasonably be expected to have a Material Adverse Effect.
5.    Representations and Warranties.  Each Loan Party represents and warrants to the Lenders that after giving effect to this Amendment (a) the representations and warranties of each Loan Party contained in Article V of the Credit Agreement or any other Loan Document, or which are contained in any document furnished at any time under or in connection therewith, are true and correct in all material respects (provided that, in each case, such materiality qualifier shall not be applicable to any representations and warranties to the extent they are already modified or qualified by materiality in the text thereof) on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they were true and correct in all material respects (provided that, in each case, such materiality qualifier shall not be applicable to any representations and warranties to the extent they are already modified or qualified by materiality in the text thereof) as of such earlier date, (b) no event has occurred and is continuing which constitutes a Default or an Event of Default and (c) as of the date hereof, the information included in the Beneficial Ownership Certification (if required) is true and correct in all respects.
6.    Counterparts/Telecopy.  This Amendment may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument.  Delivery of executed counterparts of this Amendment by telecopy or other secure electronic format (.pdf) shall be effective as an original.
7.    GOVERNING LAW.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
[remainder of page intentionally left blank]

7

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first above written.
		
	BORROWER:
	COEUR MINING, INC., 
a Delaware corporation

By: /s/ Peter C. Mitchell     
Name:  Peter C. Mitchell 
Title:  Senior Vice President and Chief Financial Officer
		
	GUARANTORS:
	COEUR EXPLORATIONS, INC.

By: /s/ Peter C. Mitchell     
Name: Peter C. Mitchell 
Title: Vice President
COEUR ROCHESTER, INC.
By: /s/ Peter C. Mitchell     
Name: Peter C. Mitchell 
Title: Vice President
COEUR CAPITAL, INC.
By: /s/ Peter C. Mitchell     
Name: Peter C. Mitchell 
Title: Vice President
COEUR ALASKA, INC.
By: /s/ Peter C. Mitchell     
Name: Peter C. Mitchell 
Title: Vice President
COEUR SOUTH AMERICA CORP.
By: /s/ Peter C. Mitchell     
Name: Peter C. Mitchell 
Title: Vice President

8

WHARF RESOURCES (U.S.A.), INC.
By: /s/ Peter C. Mitchell     
Name: Peter C. Mitchell 
Title: Vice President 
WHARF RESOURCES MANAGEMENT INC.
By: /s/ Peter C. Mitchell     
Name: Peter C. Mitchell 
Title: Vice President
WHARF REWARD MINES INC.
By: /s/ Peter C. Mitchell     
Name: Peter C. Mitchell 
Title: Vice President
WHARF GOLD MINES INC.
By: /s/ Peter C. Mitchell     
Name: Peter C. Mitchell 
Title: Vice President
GOLDEN REWARD MINING COMPANY LIMITED PARTNERSHIP
By.  Wharf Gold Mines Inc., its General Partner
By: /s/ Peter C. Mitchell      
Name: Peter C. Mitchell 
Title: Vice President

9

ADMINISTRATIVE
		
	AGENT:
	BANK OF AMERICA, N.A., 
as Administrative Agent

By: /s/ Paley Chen     
Name: Paley Chen  
Title: Vice President

10

		
	LENDERS:
	BANK OF AMERICA, N.A., 
as a Lender, L/C Issuer and Swingline Lender

By: /s/ Jonathan M. Phillips     
Name: Jonathan M. Phillips 
Title: Senior Vice President
ROYAL BANK OF CANADA, 
as a Lender
By: /s/ Stam Fountoulakis     
Name: Stam Fountoulakis 
Title: Authorized Signatory 
BANK OF MONTREAL, CHICAGO BRANCH, 
as a Lender
By: /s/ Brian L. Banke     
Name: Brian L. Banke 
Title: Managing Director
THE BANK OF NOVA SCOTIA,  
as a Lender
By: /s/ Ian Stephenson     
Name: Ian Stephenson 
Title: Managing Director
By:  /s/ Monik Vora     
Name: Monik Vora 
Title:  Associate Director

11

Schedule 2.01
SCHEDULE 2.01
COMMITMENTS AND APPLICABLE PERCENTAGES

	
						
	Lender
	Revolving Commitment
	Applicable Percentage

	Bank of America, N.A.
	$
	87,500,000.00
	

	35.000000000
	%

	Royal Bank of Canada
	$
	67,500,000.00
	

	27.000000000
	%

	Bank of Montreal, Chicago Branch
	$
	47,500,000.00
	

	19.000000000
	%

	The Bank of Nova Scotia
	$
	47,500,000.00
	

	19.000000000
	%

	 
	 
	 

	Total
	

	$250,000,000.00
	

	100.000000000
	%

12

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