Document:

Exhibit 10.18

 

INVESTMENT AGREEMENT

(Unregistered
Shares – Battlefield I)

 

THIS INVESTMENT AGREEMENT (“Agreement”)
is made as of March 28, 2012, by and between HOWARD BANCORP, INC., a Maryland corporation (“Issuer”), and Weaver Consulting &
Asset Management, LLC d/b/a BATTLEFIELD CAPITAL MANAGEMENT, LLC, a Pennsylvania limited liability company (“Investor”).  Investor
is entering into this Agreement on behalf of accounts that it manages or advises and for which it has discretionary authority to
buy or sell shares.

 

WHEREAS, the Board of Directors of Issuer
(the “Board of Directors”) proposes to issue to Investor, and Investor proposes to purchase from Issuer, that number
of shares of common stock of Issuer, $0.01 par value per share (“Issuer Common Stock”), such that, after
giving effect to (a) the shares of Issuer Common Stock sold in the public rights offering (the “Rights Offering”)
described in the Issuer’s Registration Statement on Form S-1 (File No. 333-178204) as filed with the U.S. Securities
and Exchange Commission (the “SEC”) on November 28, 2011, as amended and supplemented from time to time (collectively,
the “S-1 Registration Statement”), (b) the shares of Issuer Common Stock sold in the public offering (the “Public
Offer”) described in the S-1 Registration Statement, (c) the purchase and sale of shares of Issuer Common Stock pursuant
to the separate investment agreements dated the date hereof between Issuer, on the one hand, and other third parties, on the other
hand (collectively, the “Institutional Placement”), and (d) such purchase and sale of shares of Issuer Common
Stock pursuant to this Agreement, Investor shall own 9.8% (the “Investor Percentage”) of the total number of shares
of Issuer Common Stock outstanding on the Closing Date (as defined in Section 2.1 hereof) (each, a “Share”, and
collectively, the “Shares”); and

 

WHEREAS, the Board of Directors of Issuer
believes that the sale of the Shares, under the terms and conditions set forth in this Agreement, is in the best interests of Issuer;

 

NOW, THEREFORE, in consideration of the
mutual promises and covenants contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties, intending to be legally bound, mutually agree as follows:

 

1.  Purchase
and Sale of Shares.

 

1.1  Subject to the terms
and conditions set forth herein, on the Closing Date, Issuer shall sell, transfer, assign and deliver unto Investor, and Investor
shall purchase from Issuer, the Shares such that Investor shall own the Investor Percentage on the Closing Date.  The
aggregate purchase price for the Shares is (i) $7.30 multiplied by (ii) the number of the Shares on the Closing Date
(the “Purchase Price”).

 

1.2  At the Closing, Investor
shall pay to Issuer the Purchase Price, in cash, in consideration of its purchase of the Shares.

 

1.3  Any certificate
or certificates representing the Shares, shall bear the following legend or a legend similar to the following, in addition to
any legend that may be required by the “blue sky” laws of any state, until such time as the applicable Securities
are tradable without restriction pursuant to Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”)
and under other applicable law:

 

    	 

    	 

    

 

THE SECURITIES REPRESENTED
BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER APPLICABLE
STATE SECURITIES ACTS (THE “STATE ACTS”) NOR IS SUCH REGISTRATION CONTEMPLATED.  SUCH SECURITIES MAY NOT
BE SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNLESS REGISTERED UNDER THE ACT AND THE STATE ACTS, EXCEPT UPON
DELIVERY TO THE COMPANY OF AN OPINION OF COUNSEL SATISFACTORY TO THE BOARD OF DIRECTORS OF THE COMPANY THAT REGISTRATION IS NOT
REQUIRED FOR SUCH TRANSFER OR THE SUBMISSION TO THE BOARD OF DIRECTORS OF THE COMPANY OF EVIDENCE SATISFACTORY TO THE BOARD TO
THE EFFECT THAT ANY SUCH TRANSFER WILL NOT BE IN VIOLATION OF THE ACT OR STATE ACTS OR ANY RULE OR REGULATION PROMULGATED THEREUNDER.

 

2.  The Closing.

 

2.1  The closing of the
transactions contemplated under this Agreement (the “Closing”) shall take place at 10:00 a.m. at the main office
of Issuer, 6011 University Boulevard, Suite 370, Ellicott City, Maryland, or at such other place as the parties shall
agree in writing, on the date following the sixth (6th) trading day after the satisfaction or waiver (subject to applicable
law) of the latest to occur of the conditions set forth in Sections 10, 11 and 12 (other than those conditions that by their
nature are to be satisfied or waived at the Closing) and the completion of the Rights Offering and the Public Offer or such other
date mutually agreed upon by the parties (the “Closing Date”).  

 

2.2  Immediately prior
to the Closing (and as a condition of Investor’s obligations to purchase the Shares and otherwise perform its obligations
under this Agreement), Issuer shall deliver to Investor a certificate executed by its Chief Executive Officer certifying that (a) as
of such date, to her knowledge, the representations and warranties of Issuer set forth herein are accurate and complete in all
respects and (b) that there has not been since the execution of this Agreement any material adverse change to Issuer’s
business.

 

2.3  Immediately prior
to the Closing (and as a condition of Issuer’s obligations to deliver the Shares and otherwise perform its obligations under
this Agreement), Investor shall deliver to Issuer a certificate executed by its Chief Executive Officer certifying as to Investor
that as of such date, to his or her knowledge, the representations and warranties of Investor set forth herein are accurate and
complete in all material respects.  

 

2.4  At the Closing, subject
to the terms and conditions hereof, Issuer shall issue the Shares to Investor and deliver to Investor a certificate representing
the Shares, duly registered in the name of Investor, as specified on the signature page hereto.  

 

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2.5  At the Closing, subject
to the terms and conditions hereof, Investor shall deliver to Issuer the Purchase Price by wire transfer of immediately available
funds to an account designed by Issuer.

 

3.  Representations,
Warranties and Covenants of Issuer.  In addition to the warranties, representations and covenants of Issuer contained
elsewhere herein, Issuer hereby warrants, represents and covenants to Investor as follows:

 

3.1  Issuer is a corporation
organized, validly existing and in good standing under the laws of the State of Maryland with full corporate power and authority
to own and hold its properties and to carry on its business as now conducted, and is duly registered and qualified to conduct its
business and is in good standing under the laws of each other jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, except as has not had or would not reasonably be expected to have a material adverse
effect upon Issuer’s ability to conduct its business or consummate the transactions contemplated hereby.

 

3.2  The authorized common
stock of Issuer consists of 10,000,000 shares of Issuer Common Stock, of which 2,640,264 shares were issued and outstanding
as of the date of this Agreement.  The authorized preferred stock of Issuer consists of 5,000,000 shares of preferred
stock, par value $0.01 per share (“Issuer Preferred Stock”), of which 12,562 shares of Senior Non-Cumulative Perpetual
Preferred Stock, Series AA, are issued and outstanding and held by U.S. Department of Treasury under the Small Business
Lending Fund program as of the date of this Agreement.  Other than the Issuer Common Stock and Issuer Preferred Stock,
there are no other authorized classes of equity securities of Issuer.  Except as disclosed in Schedule 3.2
to this Agreement, there are no outstanding subscriptions, options, warrants, debt instruments or other agreements obligating Issuer
to issue, sell or otherwise dispose of any shares of Issuer Common Stock.  As of the Closing, the Shares are being sold,
and (upon receipt by Investor at the Closing) will be, free and clear of all liabilities, debts, obligations, encumbrances, leases,
indebtedness, liens, charges, and pledges, of whatever nature, whether fixed or contingent, disclosed or undisclosed, foreseen
or unforeseen, as of the date of this Agreement.

 

3.3  Issuer possesses
the requisite corporate power and authority to execute and deliver this Agreement and to perform all of its obligations hereunder
and has taken all necessary action to authorize the execution, delivery and performance of this Agreement, and no additional consent
or approval of any other person, entity or governmental authority is required therefor.  

 

3.4  This Agreement has
been duly executed and delivered by Issuer and (assuming it has been duly authorized, executed and delivered by Investor) is a
legal, valid and binding obligation of Issuer and is fully enforceable against it in accordance with its terms and conditions,
except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar
laws relating to, or affecting generally the enforcement of, creditors’ rights and remedies or by other equitable principles
of general application.

 

3.5  The execution and
delivery of this Agreement by Issuer, the consummation of the transactions contemplated hereby, and the compliance by Issuer with
the terms and provisions hereof, will not result in a default under (or give any other party the right, with the giving of notice
or the passage of time (or both), to declare a default or accelerate any obligation under) any agreement to which Issuer is a party
or by which it or its properties or assets are bound, or violate any law, regulation, decree, writ, order or injunction which,
collectively, would have a material adverse effect upon Issuer’s ability to consummate the transactions contemplated hereby.  

 

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3.6  Issuer has made all
necessary filings with all applicable federal, state and local authorities and/or regulatory bodies, and has complied with all
applicable laws, in each case with respect to the transaction contemplated herein, and Issuer will take all such further actions
as are necessary or appropriate to cause the transaction contemplated hereby to comply with all applicable laws.  

 

3.7  The audited consolidated
financial statement of Issuer and its subsidiaries at and for the periods ended December 31, 2009, 2010 and 2011 fairly present
in all material respects the consolidated financial position and results of operation of Issuer and such subsidiaries as, at and
for such periods, in each case, in accordance with Generally Accepted Accounting Principles in the United States consistently applied
during the periods involved, except in each case, as may be noted therein.  Except as disclosed in Schedule 3.7
to this Agreement, neither Issuer nor Howard Bank (the “Bank”) has received notice from any governmental authority
that the Bank’s Reports of Condition (“CALL Reports”) submitted to its primary federal regulator and the State
of Maryland under the applicable law fail to conform in all material respects to the Federal Financial Institutions Examination
Council’s requirements for CALL Reports or the requirements of Section 37 of the Federal Deposit Insurance Act and applicable
regulations thereunder.  Except as disclosed in Schedule 3.7 to this Agreement, since the filing of Issuer’s
most recent call report, there has been no material adverse change to Issuer’s financial condition or its results of operations
of the kind which would be required to be disclosed in filings with the SEC under applicable federal securities laws if Issuer
were required to file reports pursuant to Sections 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”) which have not been so disclosed to Investor.

 

4.  Representations,
Warranties and Covenants of Investor.  In addition to the warranties, representations and covenants of Investor contained
elsewhere herein, Investor hereby warrants, represents and covenants to Issuer as follows:

 

4.1  Investor is a limited
liability company organized, validly existing and in good standing under the laws of the Commonwealth of Pennsylvania with full
corporate power and authority to own and hold its properties and to carry on its business as now conducted, and is duly registered
and qualified to conduct its business and is in good standing under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such qualification, except as has not had or would not reasonably be expected
to have a material adverse effect upon Investor’s ability to conduct its business or consummate the transactions contemplated
hereby.

 

4.2  Investor possesses
all requisite power and authority to execute and deliver this Agreement and to perform all of its obligations hereunder and has
taken all necessary action to authorize the execution, delivery and performance of this Agreement, and no additional consent or
approval of any other person, entity or governmental authority is required therefor.  

 

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4.3  This Agreement has
been duly executed and delivered by Investor and (assuming it has been duly authorized, executed and delivered by Issuer) is a
legal, valid and binding obligation of Investor and is fully enforceable against it in accordance with its terms and conditions,
except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar
laws relating to, or affecting generally the enforcement of, creditors’ rights and remedies or by other equitable principles
of general application.

 

4.4  Investor has such
knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of an investment
in Issuer Common Stock and is able to bear the economic risk of loss with respect to its investment in Issuer Common Stock.  Investor
is not an officer, director or “affiliate” (as that term is defined in Rule 405 promulgated under the Securities
Act) of Issuer.  

 

4.5  The execution and
delivery of this Agreement by Investor, the consummation of the transactions contemplated hereby, and the compliance by Investor
with the terms and provisions hereof will not result in a default under (or give any other party the right, with the giving of
notice or the passage of time (or both), to declare a default or accelerate any obligation under) any agreement to which Investor
is a party or by which it or its properties or assets are bound, or violate any law, regulation, decree, writ, order or injunction
which, collectively, would have a material adverse effect upon Investor’s ability to consummate the transactions contemplated
hereby.

 

4.6  The representations
and warranties made here in are accurate in all material respects.  Investor will have the fiduciary and legal authority
of assets under management sufficient to pay the Purchase Price as of the Closing.

 

4.7  Investor has requested
and received such information and has made such due diligence investigation, including having such access to the management of
Issuer and the books and records of Issuer and its affiliated companies, as Investor has deemed pertinent to its consideration
of the purchase of the Shares.  Investor has had the opportunity to question, and has questioned, to the extent deemed
necessary or appropriate, representatives of Issuer so as to receive answers and verify information obtained in such Investor’s
examination of Issuer, including the information that Investor has received and reviewed as otherwise referenced herein in relation
to its investment in the Shares.  Investor has not been furnished a prospectus or any part of a registration statement
filed with the SEC or state securities agency or commission.  Investor has reviewed publicly available information regarding
Issuer and the information provided to Investor by Issuer in connection with Investor’s due diligence and is familiar with
the existing and proposed business operations, management and financial condition of Issuer.  Investor acknowledges and
understands the risks involved in and tax consequences of this investment, including the risk of losing the entire investment in
the Issuer Common Stock, and the tax consequences of this investment to Investor.  

 

4.8  Investor is not relying
on Issuer or on any legal or other opinion in the materials reviewed by Investor with respect to the financial or tax considerations
of Investor relating to its investment in the Shares, and has consulted with its own legal, accounting, tax, investment and other
advisers for legal, tax treatment or investment advice with respect to the merits and risk of an investment in Issuer Common Stock,
the transactions contemplated by this Agreement and the securities laws of any jurisdiction applicable to Investor.  Investor
has relied solely on the representations and warranties, covenants and agreements of Issuer in this Agreement and on its examination
and independent investigation in making its decision to acquire the Shares.

 

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4.9  No oral or written
material representations have been made to Investor in connection with Investor’s acquisition of the Shares which were in
any way inconsistent with the information reviewed by Investor.  Investor acknowledges that in deciding whether to enter
into this Agreement and to purchase the Shares hereunder, it has not relied on any representations or warranties of any type or
description made by Issuer or any of its representatives with regard to Issuer, any of its subsidiaries, any of their respective
businesses or properties, or the prospects of the investment contemplated herein, other than the representations and warranties
set forth in Section 3 hereof.

 

4.10  The Shares are being
purchased for accounts managed or advised by Investor, with their own funds and not the funds of any other person, for investment
only and not with a view toward resale, assignment, fractionalization, or distribution thereof.  Investor acknowledges
and agrees that it may not sell, transfer or otherwise dispose of the Shares unless the resale of such shares have been registered
under the Securities Act and applicable state securities laws and such sale or other disposition is made pursuant to such registration,
or an exemption from the registration requirements of the Securities Act and such laws is available, in which case, if reasonably
requested by Issuer, such sale or other disposition can only be effected if (i) the purchaser or transferee agrees in writing to
be bound by the applicable terms of this Agreement and (ii) unless effected pursuant to Rule 144 under the Securities Act, Investor
shall have furnished Issuer with an opinion of counsel, reasonably satisfactory to Issuer, that such disposition will not require
registration under the Securities Act.  Investor has no present arrangement (whether or not legally binding) at any time
to transfer the Shares.  There are no agreements or other arrangements, written or otherwise, between Investor and any
other person to act together for the purpose of acquiring, holding, voting or disposing of the Shares.  Investor also
represents that each of the accounts which it manages or advises to which the Shares will be allocated is an “accredited
investor,” as that term is defined in Rule 501 of Regulation D under the Securities Act, and either does not have the
discretion to distribute or resell the Shares allocated to it or is not purchasing such allocation of Shares with a view toward
resale, assignment, fractionalization, or distribution thereof.  Investor also represents
that it has discretionary authority to act on behalf of such accounts.

 

4.11  Investor has not
incurred any obligation for any finder’s or broker’s or agent’s fees or commissions in connection with the transactions
contemplated hereby.

 

4.12  Investor acknowledges
and agrees that the Shares are not shares of capital stock in the Bank and are not savings accounts or deposits of the Bank and
are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency, and that no Federal
or state governmental agency has passed upon or will pass upon the offer or sale of the Shares or has made or will make any finding
or determination as to the fairness of this investment.

 

5.  Confidentiality
Agreement.  Investor and Issuer hereby acknowledge that the Confidentiality Agreement entered into between them dated
October 30, 2011 remains in full force and effect until the Closing.

 

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6.  Notices.  All
notices or other communications required or permitted to be given hereunder shall be in writing and shall be by registered or certified
mail, return receipt requested, or guaranteed overnight delivery, addressed as set forth below or as may be otherwise specified
by notice meeting the requirements of this paragraph.  All notices shall be deemed given when mailed pursuant to the
foregoing sentence.  Notices shall be addressed as follows:

 

If to Issuer:

Howard Bancorp, Inc.

ATTN: Mary Ann Scully

Chairman, President and Chief Executive Officer

6011 University Blvd., Suite 370

Ellicott City, MD  21043

Telephone:  (410) 750-0024

Facsimile No.:  (410) 750-8588

 

With a copy to:

 

Frank C. Bonaventure, Jr.

Ober|Kaler

100 Light Street

Baltimore, MD  21202

Telephone:  (410) 347-7305

Facsimile No.:  (443) 263-7505

 

If to Investor:

 

James M. Weaver

Chief Executive Officer

Weaver Consulting & Asset Management, LLC

620 Freedom Business Center, Suite 200

King of Prussia, PA  19406

Telephone:  (610) 205-6110

Facsimile No.:  (610) 371-7745

 

7.  Issuer
Covenants.  In connection with the issuance of the Shares:

 

7.1  For a period of three
(3) years following the Closing Date, Issuer shall use commercially reasonable efforts to timely file (or obtain extensions in
respect thereof and file within the applicable grace period) all reports required to be filed by Issuer after the date hereof pursuant
to the Exchange Act.  Upon the request of Investor, Issuer shall deliver to Investor a written certification of a duly
authorized officer as to whether it has complied with the preceding sentence.  For a period of three (3) years following
the Closing Date, if Issuer is not required to file reports pursuant to the Exchange Act, it will prepare and furnish to Investor
and make publicly available in accordance with Rule 144 promulgated under the Securities Act such information as is required for
such persons to sell shares of Issuer Common Stock under Rule 144 promulgated under the Securities Act.

 

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7.2  For a period of three
(3) years following the Closing Date, Issuer shall use commercially reasonable efforts to cause the Issuer Common Stock to continue
to be registered under Section 12(b) or 12(g) of the Exchange Act, and to comply in all respects with is reporting and filing obligations
under the Exchange Act.

 

7.3  Issuer acknowledges
that it believes, and agrees not to take a contrary position (assuming no change in the facts as of the date hereof), that Investor
is not an “affiliate” (as defined in Rule 144 promulgated under the Securities Act) of Issuer as of the Closing Date.  Issuer
further agrees that to the extent that current securities laws applicable to Issuer permit a person who is not an “affiliate”
(as defined in Rule 144 promulgated under the Securities Act) that acquires Shares from Investor to tack onto such person’s
holding period Investor’s holding period of such Shares ,  Issuer agrees not to take a contrary position.

 

7.4  For a period of three
(3) years following the Closing Date, Issuer shall use its commercially reasonable efforts to cause all of the Shares issued to
the Investor to be listed on the NASDAQ Capital Market to the extent it meets the listing requirements thereof.

 

8.  [Intentionally
Omitted]

 

9.  [Intentionally
Omitted].  

 

10.  Mutual
Conditions to Closing.  The obligation hereunder of Investor to purchase, and Issuer to sell, the Shares at the Closing
is subject to the satisfaction, at or before the Closing, of each of the conditions set forth below (unless waived by Investor
and Issuer):

 

10.1  All consents and
approvals of any regulatory body or agency necessary to consummate the transactions contemplated by this Agreement shall have been
obtained and all notice and waiting periods required by law to pass after receipt of such approvals or consents shall have passed,
and all conditions to consummation of the transactions set forth in this Agreement shall have been satisfied.

 

10.2  There shall be no
actual or threatened causes of action, investigations or proceedings (i) challenging the validity or legality of this Agreement
or the consummation of the transactions contemplated by this Agreement, (ii) seeking damages in connection with the transactions
contemplated by this Agreement, or (iii) seeking to restrain or invalidate the transactions contemplated by this Agreement,
which, in the reasonable judgment of the parties, based upon advice of counsel, would have a material adverse effect with respect
to the interests of the parties to this Agreement.  No judgment, order, injunction or decree (whether temporary, preliminary
or permanent) issued by any court or agency of competent jurisdiction or other legal restraints or prohibition preventing the consummation
of the transactions contemplated by this Agreement shall be in effect.  No statute, rule, regulation, order, injunction
or decree (whether temporary, preliminary or permanent) shall have been enacted, entered, promulgated or enforced by any regulatory
authority that prohibits, restricts, or makes illegal the consummation of the transactions contemplated in this Agreement.

 

11.  Conditions
Precedent to the Obligation of Investor to Purchase the Shares.  The obligation hereunder of Investor to purchase
the Shares at the Closing is subject to the satisfaction, at or before the Closing, of each of the conditions set forth below (unless
waived by the Investor):

 

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11.1  Each of the representations
and warranties of Issuer contained in this Agreement shall be true and correct in all material respects, and Investor shall have
received the certificate executed by Issuer’s Chief Executive Officer set forth in Section 2.2 hereof.

 

11.2  Issuer shall have
performed, satisfied and complied in all respects with all covenants, agreements and conditions required by this Agreement to be
performed, satisfied or complied with by Issuer at or prior to the Closing.

 

11.3  From the date hereof
through the Closing, Issuer shall have raised at least $6,000,000.00 in aggregate gross proceeds from sales of Issuer Common Stock,
including proceeds from the sale of Shares hereunder, the Institutional Placement, the Rights Offering and the Public Offer.

 

11.4  The S-1 Registration
Statement, and any amendment or supplement thereto, shall have previously become effective, and such S-1 Registration Statement
shall be effective on or immediately prior to the Closing Date and (i) Issuer shall not have received notice that the SEC
has issued or intends to issue a stop order with respect to such S-1 Registration Statement or that the SEC otherwise has suspended
or withdrawn the effectiveness of such S-1 Registration Statement, either temporarily or permanently, or intends or has threatened
to do so (unless the SEC’s concerns have been addressed and Investor is reasonably satisfied that the SEC no longer is considering
or intends to take such action), and (ii) no other suspension of the use or withdrawal of the effectiveness of such S-1 Registration
Statement or related prospectus shall exist.

 

11.5  The Issuer Common
Stock shall have been approved for listing on the Nasdaq Capital Market, trading of the Issuer Common Stock shall not have been
suspended by the SEC, the Nasdaq Capital Market or FINRA and the Issuer Common Stock shall not have been delisted from the Nasdaq
Capital Market.

 

12.  Conditions Precedent
to the Obligation of Issuer to Sell the Shares.  The obligation hereunder of Issuer to sell the Shares at the Closing
is subject to the satisfaction, at or before the Closing, of each of the conditions set forth below (unless waived by the Issuer):

 

12.1  Each of the representations
and warranties of Investor contained in this Agreement shall be true and correct in all material respects, and Issuer shall have
received the certificate executed by Investor’s Chief Executive Officer set forth in Section 2.3 hereof.

 

12.2  Investor shall have
performed, satisfied and complied in all respects with all covenants, agreements and conditions required by this Agreement to be
performed, satisfied or complied with by Investor at or prior to the Closing.

 

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13.  Gross
Up Rights.

 

13.1  Subject to applicable
securities laws, other than the offering registered in the S-1 Registration Statement, Investor shall have the right to purchase
its pro rata share of all Equity Securities, as defined below, that Issuer may, from time to time, propose to sell and issue
after the date of this Agreement, other than the Equity Securities excluded by Section 13.5 hereof.  Investor’s
pro rata share is equal to the ratio of (a) the total number of outstanding shares of Issuer Common Stock that such Investor
is deemed to be a holder immediately prior to the issuance of such Equity Securities to (b) the total number of shares of the outstanding
Issuer Common Stock (including all shares of Issuer Common Stock issued or issuable upon conversion of any securities convertible
into Issuer Common Stock or upon the exercise of any outstanding warrants or options) immediately prior to the issuance of the
Equity Securities.  The term “Equity Securities” shall include (i) any Issuer Common Stock, (ii) any security
convertible into or exercisable or exchangeable for, with or without consideration, Issuer Common Stock (including any option to
purchase such a convertible security), (iii) any security carrying any warrant or right to subscribe to or purchase any Issuer
Common Stock, and (iv) any such warrant or right.

 

13.2  If Issuer proposes
to issue any Equity Securities, it shall give Investor written notice of its intention, describing the Equity Securities and the
price and the terms and conditions upon which Issuer proposes to issue the same.  Investor shall have ten (10) days from
the receipt of such notice (the “Offer Period”) to notify Issuer in writing that it intends to exercise its Gross-Up
Right and as to the amount of Equity Securities Investor intends to purchase, up to the maximum calculated in accordance with Section
13.1 (the “Designated Securities”); provided, however, that if providing Investor ten (10) days’ notice to respond
is not practicable, Issuer may provide an earlier deadline for Investor to respond to such notice but giving Investor the maximum
number of days to respond as is practicable.  Such notice shall constitute a non-binding indication of interest of Investor
to purchase the amount of Designated Securities specified by Investor (or a proportionately lesser amount if the amount of Equity
Securities to be offered if such offering of Equity Securities is subsequently reduced) at the price (or range of prices) and other
terms set forth in Issuer’s notice to it.  The failure to respond during the Offer Period constitutes a waiver
of its Gross Up Right in respect of such offering.  Investor shall execute a binding agreement to purchase any such Equity
Securities within 30 days after expiration of the Offer Period, and any Equity Securities that Investor indicated it would purchase
but that are not covered by a binding purchase agreement at such time may be sold to other persons, unless the failure to execute
such an agreement is attributable to actions of Issuer, in which case Issuer shall have the right to sell the Equity Securities
to other persons within a reasonable time after the reason for such delay has been resolved.  Notwithstanding the foregoing,
Issuer shall not be required to offer or sell such Equity Securities to any Investor who would cause Issuer to be in violation
of applicable federal securities or bank regulatory laws by virtue of such offer or sale.

 

13.3  Issuer shall have
180 days after expiration of the Offer Period to sell any Equity Securities in respect of which Investor’s Gross Up Rights
were not exercised, at a price and upon general terms and conditions not materially more favorable to the purchasers thereof than
specified in Issuer’s notice to Investor pursuant to Section 13.2 hereof.  If Issuer has not sold such Equity Securities
within 180-day period, Issuer shall not thereafter issue or sell any Equity Securities, without first offering such Equity Securities
to the Investor in the manner provided above.

 

13.4  The Gross Up Rights
provided by this Section 13 shall not apply to, and shall terminate upon the earlier of (a) the first date upon which Investor
no longer beneficially owns Issuer Common Stock representing at least 9.8% of the issued and outstanding shares of Issuer Common
Stock immediately prior to an issuance contemplated under Section 13.1 hereof, (b) the date of any breach by Investor
of any obligation under this Agreement, or (c) the third anniversary of the Closing Date.

 

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13.5  The provisions in
this Section 13 shall not apply to any issuance of Equity Securities by Issuer (i) to employees, consultants, officers
or directors of Issuer or any of its subsidiaries for the primary purpose of soliciting or retaining their employment or services
or in a transaction or pursuant to management or employee agreements, incentive programs or stock purchase or equity compensation
plans approved by the Board of Directors (including any such programs or plans in existence on the date hereof), (ii) by Issuer
to a third party as consideration in connection with (but not in connection with raising capital to fund) (A) a strategic
business combination or other merger, acquisition or disposition transaction, partnership, joint venture, strategic alliance or
investment by Issuer or similar non-capital raising transaction approved by the Board of Directors,  or (B) an investment
by Issuer or its subsidiaries approved by the Board of Directors in any party which is not prior to such transaction an affiliate
of Issuer (whether by merger, consolidation, sale or exchange of stock, sale of assets or securities, or otherwise), (iii)  as
part of any offering registered under the Securities Act, provided, that Investor shall not be precluded by Issuer, its underwriter
or its agent in connection with such offering from purchasing in such offering, on the same terms and conditions offered to the
public, a sufficient number of Designated Securities, so as to maintain its pro rata share of all Equity Securities, (iv) upon
the exercise, conversion or exchange of options, warrants or similar rights or other convertible securities, and (v) in connection
with any stock split, stock dividend paid on a proportionate basis to all holders of the affected class of capital stock or recapitalization
approved by the Board of Directors.  

 

14.  Miscellaneous.

 

14.1  This Agreement (including
any exhibits and schedules hereto) and the other documents delivered or to be delivered hereunder set forth the entire understanding
of the parties with respect to its subject matter, supersede all prior agreements and understandings between the parties in respect
of its subject matter.  This Agreement shall be binding upon and inure to the benefit of the parties, their heirs, legal
representatives, successors and assigns.  This Agreement is not transferable or assignable by the parties without the
prior written consent of the other party.

 

14.2  This Agreement may
not be modified, amended, supplemented or altered except by written agreement executed by all parties hereto.  No failure
to exercise, and no delay in exercising, any right, power or privilege under this Agreement shall operate as a waiver, nor shall
any single or partial exercise of any right, power or privilege hereunder preclude the exercise of any other right, power or privilege.  No
waiver of any breach of any provision shall be deemed to be a waiver of any preceding or succeeding breach of the same or any other
provision, nor shall any waiver be implied from any course of dealing between the parties.  No extension of time for
performance of any obligations or other acts hereunder or under any other agreement shall be deemed to be an extension of the time
for performance of any other obligations or any other acts.  The rights and remedies of the parties under this Agreement
are in addition to all other rights and remedies, at law or equity, that they may have against each other.

 

    	11

    	 

    

 

14.3  The parties shall
pay their own fees and expenses, including their own counsel fees, incurred in connection with this Agreement and the transactions
contemplated hereby.

 

14.4  The representations,
warranties, covenants and agreements of Issuer and Investor contained herein or made pursuant to this Agreement which by their
terms are intended to survive the consummation of the transactions contemplated by this Agreement shall survive the execution and
delivery of this Agreement.

 

14.5  This Agreement shall
be governed by and construed in accordance with the laws of the State of Maryland, without regard to its conflicts of law principles.  Any
legal proceedings with respect to this Agreement shall take place solely within the Circuit Court of Howard County, Maryland and
all parties hereto consent to the jurisdiction of said Court.  THE PARTIES TO THIS AGREEMENT HEREBY WAIVE THEIR RIGHT
TO A TRIAL BY JURY WITH RESPECT TO DISPUTES ARISING UNDER THIS AGREEMENT AND THE RELATED AGREEMENTS AND CONSENT TO A BENCH TRIAL
WITH THE APPROPRIATE JUDGE ACTING AS THE FINDER OF FACT.  Notwithstanding the foregoing, a judgment may be enforced by
any court of competent jurisdiction.

 

14.6  Issuer will provide
to Investor an advance copy of any proposed announcement to be made by Issuer with respect to this Agreement and/or the transactions
contemplated hereby and Investor shall have the right to approve any information contained therein regarding Investor, its affiliates
and the transactions contemplated hereby, which approval shall not be unreasonably withheld or delayed.  Further, Investor
will not make any public announcement with respect to this Agreement and/or the transactions contemplated thereby without approval
by Issuer of the content and timing of such announcement, which approval shall not be unreasonably withheld or delayed.  Notwithstanding
the foregoing, (a) Issuer or the Bank may disclose information relating to the transactions contemplated by this Agreement without
the consent of Investor to any regulatory agency with jurisdiction over Issuer or the Bank or as may be required by law and (b)
Investor may disclose information relating to the transactions contemplated by this Agreement without the consent of Issuer in
connection with any regulatory applications or notices or other filings made by Investor in connection with the transactions contemplated
by this Agreement.

 

14.7  This Agreement may
be executed by facsimile signature and in any number of counterparts, each of which shall for all purposes be deemed an original
but all of which together shall constitute one and the same instrument.

 

14.8  The section and
subsection headings contained in this Agreement are included for convenience only and are not to be considered in construing this
Agreement.

 

14.9  In the event one
or more of the provisions of this Agreement should, for any reason, be held to be invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other provisions of this Agreement, and this Agreement shall
be construed as if such invalid, illegal or unenforceable provision had never been contained herein.

 

14.10  Each of Issuer
and Investor shall execute and deliver such additional instruments and other documents and shall take such further actions as may
be reasonably necessary or appropriate to effectuate, carry out and comply with all of the terms of this Agreement and the transactions
contemplated hereby.

 

14.11  The obligation
of Investor under this Agreement shall expire on July 27, 2012.

 

    	12

    	 

    

 

IN WITNESS WHEREOF, the parties have hereunto
set their hands and seals as of the day and year first above written.

 

	 	HOWARD BANCORP, INC., Issuer
	 	 
	 	By:	 
	 	 	 
	 	 	Chairman, President and Chief Executive Officer
	 	 	 
	 	WEAVER CONSULTING & ASSET
	 	MANAGEMENT, LLC d/b/a BATTLEFIELD CAPITAL
	 	MANAGEMENT, LLC, Investor
	 	 	 
	 	By:	 
	 	 	James M. Weaver
	 	 	Chief Executive Officer

 

    	13Exhibit No. 10.01

 

 

Amendment
to Loan DOCUMENTS

 

THIS
AMENDMENT to Loan Documents (this “Amendment” or the “March 2012 Amendment”) is entered
into as of March 23, 2012 (the “March 2012 Amendment Date”), by and between SILICON VALLEY BANK, a California corporation
(“Bank” or “Silicon”), and ENCISION INC., a Colorado corporation (“Borrower”). Borrower’s
chief executive office is located at 6797 Winchester Circle, Boulder, CO 80301.

 

Recitals

 

A.          Borrower
and Bank are parties to that certain Loan and Security Agreement dated as of November 10, 2006 (as amended, restated, supplemented
or otherwise modified from time to time, the “Loan Agreement”) in effect between Borrower and Bank.

 

B.          Bank
has extended credit to Borrower for the purposes permitted in the Loan Agreement.

 

C.          Borrower
has requested that Bank amend the Loan Agreement to extend the Revolving Line Maturity Date, as set forth in Section 2.1 below;
all as more fully set forth herein.

 

D.          Bank
has agreed to so amend such provision of the Loan Agreement, but only to the extent, in accordance with the terms, subject to the
conditions and in reliance upon the representations and warranties set forth below.

 

Agreement

 

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

 

1.          Definitions.
Capitalized terms used but not defined in this Amendment shall have the meanings given to them in the Loan Agreement. The term
“March 2012 Amendment Date” as defined above hereby is incorporated into the Loan Agreement.

 

2.          Amendment
to Loan Documents.

 

    	1

    	 

    
 

2.1          Extension
of Revolving Line Maturity Date. The definition of Revolving Line Maturity Date set forth in Section 13.1 of the Loan Agreement,
which definition currently reads as follows (italics added):

 

“ “Revolving
Line Maturity Date” is March 23, 2012. ”

 

hereby is amended and restated in its entirety
to read as follows:

 

“ “Revolving
Line Maturity Date” is May 23, 2012. ”

 

 

3.          Limitation
of Amendment.

 

3.1          The
amendment set forth in Section 2 above, is effective for the purposes set forth herein and shall be limited precisely
as written and shall not be deemed to (a) be a consent to any amendment, waiver or modification of any other term or condition
of any Loan Document, or (b) otherwise prejudice any right or remedy which Bank may now have or may have in the future under
or in connection with any Loan Document.

 

3.2          This
Amendment shall be construed in connection with and as part of the Loan Documents and all terms, conditions, representations, warranties,
covenants and agreements set forth in the Loan Documents (as amended by this Amendment, as applicable) are hereby ratified and
confirmed and shall remain in full force and effect.

 

4.          Representations
and Warranties. To induce Bank to enter into this Amendment, Borrower hereby represents and warrants to Bank as follows:

 

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

 

4.2          Borrower
has the power and authority to execute and deliver this Amendment and to perform its obligations under the Loan Documents, as amended
by this Amendment;

 

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

 

4.4          The
execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan Documents,
as amended by this Amendment, have been duly authorized;

 

    	2

    	 

    
 

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

 

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

 

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

 

5.          Release
by Borrower. Borrower hereby agrees as follows:

 

5.1          FOR
GOOD AND VALUABLE CONSIDERATION, Borrower hereby forever relieves, releases, and discharges Bank and its present or former
employees, officers, directors, agents, representatives, attorneys, and each of them, from any and all claims, debts, liabilities,
demands, obligations, promises, acts, agreements, costs and expenses, actions and causes of action, of every type, kind, nature,
description or character whatsoever, whether known or unknown, suspected or unsuspected, absolute or contingent, arising out of
or in any manner whatsoever connected with or related to facts, circumstances, issues, controversies or claims existing or arising
from the beginning of time through and including the date of execution of this Amendment (collectively “Released Claims”).
Without limiting the foregoing, the Released Claims shall include any and all liabilities or claims arising out of or in any manner
whatsoever connected with or related to the Loan Documents, the Recitals hereto, any instruments, agreements or documents executed
in connection with any of the foregoing or the origination, negotiation, administration, servicing and/or enforcement of any of
the foregoing.

 

5.2          In
furtherance of this release, Borrower expressly acknowledges and waives any and all rights under Section 1542 of the California
Civil Code, which provides as follows:

 

“A GENERAL RELEASE DOES NOT
EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR EXPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.” (Emphasis added.)

 

(and the equivalent thereof,
if any, under the laws of any other applicable jurisdiction).

 

    	3

    	 

    
 

5.3          By
entering into this release, Borrower recognizes that no facts or representations are ever absolutely certain and it may hereafter
discover facts in addition to or different from those which it presently knows or believes to be true, but that it is the intention
of Borrower hereby to fully, finally and forever settle and release all matters, disputes and differences, known or unknown, suspected
or unsuspected; accordingly, if Borrower should subsequently discover that any fact that it relied upon in entering into this release
was untrue, or that any understanding of the facts was incorrect, Borrower shall not be entitled to set aside this release by reason
thereof, regardless of any claim of mistake of fact or law or any other circumstances whatsoever. Borrower acknowledges that it
is not relying upon and has not relied upon any representation or statement made by Bank with respect to the facts underlying this
release or with regard to any of such party’s rights or asserted rights.

 

5.4          This
release may be pleaded as a full and complete defense and/or as a cross-complaint or counterclaim against any action, suit, or
other proceeding that may be instituted, prosecuted or attempted in breach of this release. Borrower acknowledges that the release
contained herein constitutes a material inducement to Bank to enter into this Amendment, and that Bank would not have done so but
for Bank’s expectation that such release is valid and enforceable in all events.

 

5.5          Borrower
hereby represents and warrants to Bank, and Bank is relying thereon, as follows:

 

(a)          Except
as expressly stated in this Amendment, neither Bank nor any agent, employee or representative of Bank has made any statement or
representation to Borrower regarding any fact relied upon by Borrower in entering into this Amendment.

 

(b)          Borrower
has made such investigation of the facts pertaining to this Amendment and all of the matters appertaining thereto, as it deems
necessary.

 

(c)          The
terms of this Amendment are contractual and not a mere recital.

 

(d)          This
Amendment has been carefully read by Borrower, the contents hereof are known and understood by Borrower, and this Amendment is
signed freely, and without duress, by Borrower.

 

    	4

    	 

    
 

(e)          Borrower
represents and warrants that it is the sole and lawful owner of all right, title and interest in and to every claim and every other
matter which it releases herein, and that it has not heretofore assigned or transferred, or purported to assign or transfer, to
any person, firm or entity any claims or other matters herein released. Borrower shall indemnify Bank, defend and hold it harmless
from and against all claims based upon or arising in connection with prior assignments or purported assignments or transfers of
any claims or matters released herein.

 

6.          Fee.
In consideration for Bank entering into this Amendment, Borrower shall pay Bank a fee in
the mutually agreed amount of $2,000.00, which fee shall be earned in full and payable concurrently with the execution and
delivery of this Amendment, and all Bank Expenses in connection herewith. Such fee shall be non-refundable and in addition to all
interest and other fees payable to Bank under the Loan Documents. Bank is authorized to charge such fee and such Bank Expenses
to Borrower’s loan account.

 

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

 

8.          Effectiveness.
This Amendment shall be deemed effective upon the due execution and delivery to Bank of this Amendment by each party hereto.

 

[Remainder of page intentionally left blank; signature page
immediately follows.]

 

    	5

    	 

    
 

In
Witness Whereof, the parties hereto have caused this Amendment to be duly executed and delivered as of the date first
written above.

 

 

	Borrower:
	 
	ENCISION Inc., a Colorado corporation
	 	 	 
	 	 	 
	By	/s/	 
	PrintName	FredPerner	 
	Title	President & CEO	 

 

 

 

	Bank:
	 
	SILICON VALLEY BANK
	 	 	 
	 	 	 
	By	/s/	 
	Print Name	Daniel Harrison	 
	Title	RM	 

 

 

Signature Page

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