Document:

ex_117994.htm

Exhibit 10.1

 

WAIVER AND SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT

 

THIS WAIVER AND SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into as of April 26, 2018 (the “Second Amendment Date”), by and among OXFORD FINANCE LLC, a Delaware limited liability company with an office located at 133 North Fairfax Street, Alexandria, Virginia 22314, as collateral agent (in its individual capacity, “Oxford”; and in its capacity as collateral agent, “Collateral Agent”), the Lenders listed on Schedule 1.1 of the Loan Agreement (as defined below) from time to time including Oxford in its capacity as a Lender (each a “Lender” and collectively, the “Lenders”), and AirXpanders, Inc., a Delaware corporation with offices located at 1047 Elwell Court, Palo Alto, CA 94303 (“Borrower”).

 

WHEREAS, Collateral Agent, Borrower and the Lenders party to the Loan Agreement from time to time have entered into that certain Loan and Security Agreement, dated as of August 4, 2017 (as amended, supplemented or otherwise modified from time to time, including, but without limitation, by that certain Waiver and First Amendment to Loan and Security Agreement dated as of November 9, 2017, the “Loan Agreement”) pursuant to which the Lenders have provided to Borrower certain loans in accordance with the terms and conditions thereof;

 

WHEREAS, an Event of Default has occurred and is continuing under (i) Section 8.2(a) (Covenant Default) of the Loan Agreement as a result of a violation of Section 6.10 of the Loan Agreement resulting from Borrower’s failure to achieve at least 70% of budgeted total revenues on a trailing six-month basis (tested quarterly), for the reporting period ending March 31, 2018, and (ii) Section 8.2(b) (Covenant Default) of the Post-Closing Letter Exhibit A, Section 1, as a result of Borrower’s failure to deliver a landlord waiver for Borrower’s leased location in Palo Alto, CA (collective, the “Existing Defaults”). By reason of the Existing Defaults, Collateral Agent has the right to accelerate the maturity of the unpaid balance of the Obligations. In addition, as a result of the foregoing Existing Defaults, Collateral Agent and the Lenders are entitled to exercise any and all default-related rights and remedies under the Loan Agreement, other Loan Documents and/or applicable Law;

 

WHEREAS, Borrower has requested that Collateral Agent and the Lenders waive the Existing Defaults;

 

WHEREAS, although the Lenders and Collateral Agent are under no obligation to do so, the Lenders and Collateral Agent have agreed to waive the Existing Defaults, 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; and

 

WHEREAS, Borrower, the Lenders and Collateral Agent desire to amend certain provisions 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;

 

NOW, THEREFORE, in consideration of the promises, covenants and agreements contained herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Borrower, the Lenders and Collateral Agent hereby agree as follows:

 

	 	
			1.

				
			Capitalized terms used herein but not otherwise defined shall have the respective meanings given to them in the Loan Agreement.

			

 

	 	
			2.

				
			Borrower acknowledges and agrees that unless the Existing Defaults are waived by Collateral Agent and the Lenders, the Existing Defaults would constitute an Event of Default under the Loan Documents as of the date hereof. Collateral Agent and the Lenders hereby waive the Existing Defaults; provided that with respect to the Event of Default as a result of Borrower’s failure to deliver a landlord waiver for Borrower’s leased location in Palo Alto, CA, the waiver of such default is conditioned upon Borrower removing all Collateral from such leased location in Palo Alto, CA within forty-five (45) days of the Second Amendment Date. Collateral Agent’s and the Lenders’ agreement to waive the Existing Defaults shall in no way obligate Collateral Agent or any Lender to make any other modifications to the Loan Agreement or to waive Borrower’s compliance with any other terms of the Loan Documents, and shall not limit or impair Collateral Agent’s and the Lenders’ right to demand strict performance of all other terms and covenants as of any date. The waiver set forth above shall not be deemed or otherwise construed to constitute a waiver of any other provisions of the Loan Agreement in connection with any other transaction.

			

 

1

 

 

	 	
			3.

				
			Borrower hereby reaffirms the security interest granted by Borrower previously in Section 4.1 of the Loan Agreement with respect to the Collateral (prior to the date hereof) and hereby grants Collateral Agent, for the ratable benefit of the Lenders, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Collateral Agent, for the ratable benefit of the Lenders, such part of the Collateral that was not pledged previously or in which security interest was not granted prior to the Second Amendment Date, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and products thereof. Furthermore, Borrower hereby authorizes Collateral Agent to file financing statements or take any other action required to perfect Collateral Agent’s security interests in the Collateral, without notice to Borrower, with all appropriate jurisdictions to perfect or protect Collateral Agent’s interest or rights under the Loan Documents, including a notice that any disposition of the Collateral, except to the extent permitted by the terms of this Amendment and/or the Loan Documents, by Borrower, or any other Person, shall be deemed to violate the rights of Collateral Agent under the Code.

			

 

	 	
			4.

				
			Section 5.2(d) of the Loan Agreement is hereby amended and restated as follows:

			

 

“Borrower and each of its Subsidiaries is the sole owner of the Intellectual Property each respectively purports to own, free and clear of all Liens other than Permitted Liens. (i) Each of Borrower’s and its Subsidiaries’ Copyrights, Trademarks and issued Patents are valid and enforceable and no part of Borrower’s or its Subsidiaries’ Intellectual Property has been judged invalid or unenforceable, in whole or in part, and (ii) to the best of Borrower’s knowledge, no claim has been made in writing that any part of the Intellectual Property or any practice by Borrower or its Subsidiaries violates the rights of any third party except to the extent such claim could not reasonably be expected to have a Material Adverse Change. Except as noted on the Perfection Certificates, neither Borrower nor any of its Subsidiaries is a party to, nor is bound by, any material license or other material agreement with respect to which Borrower or such Subsidiary is the licensee that (i) prohibits or otherwise restricts Borrower or its Subsidiaries from granting a security interest in Borrower’s or such Subsidiaries’ interest in such material license or material agreement or any other property, or (ii) for which a default under or termination of could interfere with Collateral Agent’s or any Lender’s right to sell any Collateral. Borrower shall provide written notice to Collateral Agent and each Lender within ten (10) days of Borrower or any of its Subsidiaries entering into or becoming bound by any license or agreement with respect to which Borrower or any Subsidiary is the licensee (other than over the counter software that is commercially available to the public).”

 

	 	
			5.

				
			Section 6.2(a)(viii) of the Loan Agreement is hereby amended and restated in its entirety as follows:

			

 

“prompt notice of (A) any material change in the composition of the Intellectual Property, (B) the registration of any copyright, including any subsequent ownership right of Borrower or any of its Subsidiaries in or to any copyright, patent or trademark, including a copy of any such registration, and (C) any event that could reasonably be expected to materially and adversely affect the value of the Intellectual Property;”

 

	 	
			6.

				
			Section 6.7 of the Loan Agreement is hereby amended and restated in its entirety as follows:

			

 

“Protection of Intellectual Property Rights. Borrower and each of its Subsidiaries shall: (a) use commercially reasonable efforts to protect, defend and maintain the validity and enforceability of its Intellectual Property that is material to Borrower’s business; (b) promptly advise Collateral Agent in writing of infringement by a third party of its Intellectual Property; and (c) not allow any Intellectual Property material to Borrower’s business to be abandoned, forfeited or dedicated to the public without Collateral Agent’s prior written consent. If Borrower or any of its Subsidiaries (i) obtains any patent, registered trademark or servicemark, registered copyright, registered mask work, or any pending application for any of the foregoing, whether as owner, licensee or otherwise, or (ii) applies for any patent or the registration of any trademark or servicemark, then Borrower or such Subsidiary shall substantially contemporaneously provide written notice thereof to Collateral Agent and each Lender and shall execute such intellectual property security agreements and other documents and take such other actions as Collateral Agent shall reasonably request in its good faith business judgment to perfect and maintain a first priority perfected security interest in favor of Collateral Agent, for the ratable benefit of the Lenders, in such property. If Borrower or any of its Subsidiaries decides to register any copyrights or mask works in the United States Copyright Office, Borrower or such Subsidiary shall: (x) provide Collateral Agent and each Lender with at least ten (10) days’ prior written notice of Borrower’s or such Subsidiary’s intent to register such copyrights or mask works together with a copy of the application it intends to file with the United States Copyright Office (excluding exhibits thereto); (y) upon Collateral Agent’s request, execute an intellectual property security agreement, intellectual property security agreement amendment, and such other documents and take such other actions as Collateral Agent may reasonably request in its good faith business judgment to perfect and maintain a first priority perfected security interest in favor of Collateral Agent, for the ratable benefit of the Lenders, in the copyrights or mask works intended to be registered with the United States Copyright Office; and (z) upon Collateral Agent’s request, record such intellectual property security agreement with the United States Copyright Office contemporaneously with filing the copyright or mask work application(s) with the United States Copyright Office, and Borrower or such Subsidiary shall promptly provide to Collateral Agent and each Lender with evidence of the recording of the intellectual property security agreement necessary for Collateral Agent to perfect and maintain a first priority perfected security interest in such property.”

 

2

 

 

	 	
			7.

				
			Section 13.1 of the Loan Agreement is hereby amended by amending and restating the following definitions therein as follows:

			

 

“‘Compliance Condition” is Borrower maintaining compliance with the financial covenants set forth in Section 6.10 from the Second Amendment Date through August 31, 2019, as determined by Collateral Agent based upon written evidence reasonably satisfactory to Collateral Agent.”

 

“‘Loan Documents’ are, collectively, this Agreement, the Financial Covenant Side Letter, the Warrants, the Perfection Certificates, each Compliance Certificate, each Disbursement Letter, the IP Agreement, and any subordination agreements, any note, or notes or guaranties executed by Borrower or any other Person, and any other present or future agreement entered into by Borrower or any other Person for the benefit of the Lenders and Collateral Agent in connection with this Agreement; all as amended, restated, or otherwise modified.”

 

	 	
			8.

				
			Section 13.1 of the Loan Agreement is hereby further amended by adding the following definitions thereto in alphabetical order:

			

 

“‘Second Amendment Date’ is April 26, 2018.”

 

“‘IP Agreement’ is that certain Intellectual Property Security Agreement entered into by and between Borrower and Collateral Agent dated as of the Second Amendment Date, as such may be amended from time to time.”

 

	 	
			9.

				
			Exhibit A (Description of Collateral) to the Loan Agreement is hereby amended and restated in its entirety as set forth on Exhibit A hereto.

			

 

	 	
			10.

				
			Borrower hereby represents and warrants that a complete and accurate list of its Intellectual Property as of the Second Amendment Date is attached hereto as Exhibit B.

			

 

	 	
			11.

				
			Borrower hereby authorizes Collateral Agent to file financing statements, amendments to financing statements or take any other action required to perfect Collateral Agent’s security interests in the Collateral (as such term has been amended pursuant to this Amendment) , without notice to Borrower, with all appropriate jurisdictions to perfect or protect Collateral Agent’s interest or rights under the Loan Documents, including a notice that any disposition of the Collateral, except to the extent permitted by the terms of the Loan Documents, by Borrower, or any other Person, shall be deemed to violate the rights of Collateral Agent under the Code.

			

 

3

 

 

	 	
			12.

				
			Limitation of Amendment.

			

 

	 	
			a.

				
			The waiver set forth in Section 2 and the amendments set forth in Sections 4 through 9, above, are effective for the purposes set forth herein and shall be limited precisely as written and shall not be deemed to (i) be a consent to any amendment, waiver or modification of any other term or condition of any Loan Document, or (ii) otherwise prejudice any right or remedy which the Lenders, or obligation which Borrower, may now have or may have in the future under or in connection with any Loan Document.

			

 

	 	
			b.

				
			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, except as herein amended, are hereby ratified and confirmed and shall remain in full force and effect.

			

 

	 	
			13.

				
			Release by Borrower.

			

 

	 	
			a.

				
			FOR GOOD AND VALUABLE CONSIDERATION, Borrower hereby forever relieves, releases, and discharges Collateral Agent and each Lender and their respective 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 solely to the extent such claims arise out of or are 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 (collectively “Released Claims”).

			

 

	 	
			b.

				
			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 suspect 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.)

 

	 	
			c.

				
			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 in respect of the Released Claims; 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.

			

 

	 	
			d.

				
			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 Collateral Agent and the Lenders to enter into this Amendment, and that Collateral Agent and the Lenders would not have done so but for Collateral Agent’s and the Lenders’ expectation that such release is valid and enforceable in all events.

			

 

4

 

 

	 	
			e.

				
			Borrower hereby represents and warrants to Collateral Agent and the Lenders, and Collateral Agent and the Lenders are relying thereon, as follows:

			

 

	 	
			i.

				
			Except as expressly stated in this Amendment, neither Collateral Agent, the Lenders nor any agent, employee or representative of any of them has made any statement or representation to Borrower regarding any fact relied upon by Borrower in entering into this Amendment.

			

 

	 	
			ii.

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

			

 

	 	
			iii.

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

			

 

	 	
			iv.

				
			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.

			

 

	 	
			v.

				
			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 Collateral Agent and the Lenders, defend and hold each 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.

			

 

	 	
			14.

				
			To induce Collateral Agent and the Lenders to enter into this Amendment, Borrower hereby represents and warrants to Collateral Agent and the Lenders as follows:

			

 

	 	
			a.

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

			

 

	 	
			b.

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

			

 

	 	
			c.

				
			The organizational documents of Borrower delivered to Collateral Agent 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;

			

 

	 	
			d.

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

			

 

	 	
			e.

				
			The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan Agreement, 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 Borrower, except as already has been obtained or made; and

			

 

5

 

 

	 	
			f.

				
			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.

			

 

	 	
			15.

				
			Except as expressly set forth herein, the Loan Agreement shall continue in full force and effect without alteration or amendment. This Amendment and the Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements.

			

 

	 	
			16.

				
			This Amendment shall be deemed effective as of the Second Amendment Date upon (a) the due execution and delivery to Collateral Agent of this Amendment, the IP Agreement, and the Warrant to be issued as of the Second Amendment Date, and (b) Borrower’s payment of all Lenders’ Expenses incurred through the date hereof, which may be debited (or ACH’d) from any of Borrower’s accounts with the Lenders.

			

 

	 	
			17.

				
			This Amendment may be executed in any number of counterparts, each of which shall be deemed an original, and all of which, taken together, shall constitute one and the same instrument.

			

 

	 	
			18.

				
			This Amendment and the rights and obligations of the parties hereto shall be governed by and construed in accordance with the laws of the State of California.

			

 

 

[Balance of Page Intentionally Left Blank]

 

6

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Waiver and Second Amendment to Loan and Security Agreement to be executed as of the date first set forth above.

 

	
			BORROWER:

				 	 
	 	 	 
	
			AIRXPANDERS, INC.

				 	 
	 	 	 
	 	 	 
	
			By /s/ Scott Murcray

				 	 
	
			Name: Scott Murcray

				 	 
	
			Title: CFO/COO

				 	 
	 	 	 
	 	 	 
	 	 	 
	
			COLLATERAL AGENT AND LENDER:

				 	 
	 	 	 
	
			OXFORD FINANCE LLC

			
	 	 	 
	 	 	 
	By /s/ Colette H. Featherly	 	 
	Name: Colette H. Featherly	 	 
	Title: Senior Vice President	 	 

 

 

 

 

Exhibit A

 

Description of Collateral

 

The Collateral consists of all of Borrower’s right, title and interest in and to the following personal property:

 

All goods, Accounts (including health care receivables), Equipment, Inventory, contract rights or rights to payment of money, leases, license agreements, franchise agreements, General Intangibles (including all Intellectual Property), commercial tort claims, documents, instruments (including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts and other Collateral Accounts, all certificates of deposit, fixtures, letters of credit rights (whether or not the letter of credit is evidenced by a writing), securities, and all other investment property, supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever located; and

 

All Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing.

 

Notwithstanding the foregoing, the Collateral does not include (i) more than 65% of the total combined voting power of all classes of stock entitled to vote the shares of capital stock (the “Shares”) of any Foreign Subsidiary, if Borrower demonstrates to Collateral Agent’s reasonable satisfaction that a pledge of more than sixty five percent (65%) of the Shares of such Subsidiary creates a present and existing adverse tax consequence to Borrower under the U.S. Internal Revenue Code; and (ii) any license or contract, in each case if the granting of a Lien in such license or contract is prohibited by or would constitute a default under the agreement governing such license or contract (but (A) only to the extent such prohibition is enforceable under applicable law and (B) other than to the extent that any such term would be rendered ineffective pursuant to Sections 9-406, 9-408 or 9-409 (or any other Section) of Division 9 of the Code); provided that upon the termination, lapsing or expiration of any such prohibition, such license or contract, as applicable, shall automatically be subject to the security interest granted in favor of Collateral Agent hereunder and become part of the “Collateral.”

 

Pursuant to the terms of a certain negative pledge arrangement with Collateral Agent and the Lenders, Borrower has agreed not to encumber any of its Intellectual Property other than with Collateral Agent’s Lien.

 

 

 

 

Exhibit B

 

Intellectual Property

 

Patents

 

	 	
			Jurisdiction

				 	 	
			Application No.

				 	 	
			Publication No.

				 	 	
			Patent No.

				 	 	
			Title

				 
	 	
			United States

				 	 	
			13/313,904

				 	 	
			2012-0078284

				 	 	
			8,394,118

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			United States

				 	 	
			13/313,919

				 	 	
			2012-0078366

				 	 	
			8,617,198

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			United States

				 	 	
			14/212,119

				 	 	
			2014-0200605

				 	 	
			8,808,322

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			United States

				 	 	
			14/186,985

				 	 	
			2014-0236210

				 	 	
			9,526,584

				 	 	
			Tissue Expanders, Implants, And Methods Of Use

				 
	 	
			United States

				 	 	
			15/368,475

				 	 	
			2017-0079737

				 	 	 	 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			United States

				 	 	
			15/389,222

				 	 	
			2017-0165025

				 	 	 	 	 	
			Tissue Expanders, Implants, And Methods Of Use

				 
	 	
			United States

				 	 	
			12/973,693

				 	 	
			2011-0152913

				 	 	 	 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Australia

				 	 	
			2005286840

				 	 	 	 	 	
			2005286840

				 	 	
			Tissue Expansion Devices

				 
	 	
			Australia

				 	 	
			2012201926

				 	 	 	 	 	
			2012201926

				 	 	
			Tissue Expansion Devices

				 
	 	
			Austria

				 	 	
			05798758.8

				 	 	
			1811914

				 	 	
			1811914

				 	 	
			Tissue Expansion Devices

				 
	 	
			Belgium

				 	 	
			05798758.8

				 	 	
			1811914

				 	 	
			1811914

				 	 	
			Tissue Expansion Devices

				 
	 	
			Denmark

				 	 	
			05798758.8

				 	 	
			1811914

				 	 	
			1811914

				 	 	
			Tissue Expansion Devices

				 
	 	
			France

				 	 	
			05798758.8

				 	 	
			1811914

				 	 	
			1811914

				 	 	
			Tissue Expansion Devices

				 
	 	
			Germany

				 	 	
			05798758.8

				 	 	
			1811914

				 	 	
			60 2005 046 871.4

				 	 	
			Tissue Expansion Devices

				 
	 	
			Italy

				 	 	
			05798758.8

				 	 	
			502015000056942

				 	 	
			1811914

				 	 	
			Tissue Expansion Devices

				 
	 	
			Japan

				 	 	
			2007-533585

				 	 	
			2008-513182

				 	 	
			5009158

				 	 	
			Tissue Expansion Devices

				 
	 	
			Spain

				 	 	
			05798758.8

				 	 	
			1811914

				 	 	
			1811914

				 	 	
			Tissue Expansion Devices

				 
	 	
			Sweden

				 	 	
			05798758.8

				 	 	
			1811914

				 	 	
			1811914

				 	 	
			Tissue Expansion Devices

				 
	 	
			Switzerland

				 	 	
			05798758.8

				 	 	
			1811914

				 	 	
			1811914

				 	 	
			Tissue Expansion Devices

				 
	 	
			United Kingdom

				 	 	
			05798758.8

				 	 	
			1811914

				 	 	
			1811914

				 	 	
			Tissue Expansion Devices

				 
	 	
			Australia

				 	 	
			2010330722

				 	 	 	 	 	
			2010330722

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Austria

				 	 	
			10838349.8

				 	 	
			2512361

				 	 	
			2512361

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Belgium

				 	 	
			10838349.8

				 	 	
			2512361

				 	 	
			2512361

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Denmark

				 	 	
			10838349.8

				 	 	
			2512361

				 	 	
			2512361

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			France

				 	 	
			10838349.8

				 	 	
			2512361

				 	 	
			2512361

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Germany

				 	 	
			10838349.8

				 	 	
			2512361

				 	 	
			60 2010 029 277.0

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Hong Kong

				 	 	
			13104997.0

				 	 	 	 	 	
			1178036

				 	 	
			Tissue Expanders

				 
	 	
			Italy

				 	 	
			10838349.8

				 	 	
			2512361

				 	 	
			502016000018652

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Japan

				 	 	
			2012-544944

				 	 	
			2013-514840

				 	 	
			5770203

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Spain

				 	 	
			10838349.8

				 	 	
			2512361

				 	 	
			2512361

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Sweden

				 	 	
			10838349.8

				 	 	
			2512361

				 	 	
			2512361

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Switzerland

				 	 	
			10838349.8

				 	 	
			2512361

				 	 	
			2512361

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			United Kingdom

				 	 	
			10838349.8

				 	 	
			2512361

				 	 	
			2512361

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Belgium

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	
			3023075

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Denmark

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	
			3023075

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			France

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	
			3023075

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Germany

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	
			3023075

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Hong Kong

				 	 	
			16113463.3

				 	 	 	 	 	
			3023075 (EP)

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Italy

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	
			3023075

				 	 	
			Tissue Expanders And Methods Of Use

				 

 

 

 

 

	 	
			Japan

				 	 	
			2015-126321

				 	 	
			2015-180346

				 	 	
			6,148,289

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Netherlands

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	
			3023075

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Spain

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	
			3023075

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Sweden

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	
			3023075

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Switzerland

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	
			3023075

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			United Kingdom

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	
			3023075

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Australia

				 	 	
			2015258187

				 	 	 	 	 	
			2015258187

				 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Australia

				 	 	
			2014218714

				 	 	 	 	 	 	 	 	
			Tissue Expanders, Implants, And Methods Of Use

				 
	 	
			Australia

				 	 	
			2017251823

				 	 	 	 	 	 	 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Canada

				 	 	
			2,581,320

				 	 	 	 	 	 	 	 	
			Tissue Expansion Devices

				 
	 	
			Canada

				 	 	
			2,821,854

				 	 	 	 	 	 	 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Canada

				 	 	
			2,909,600

				 	 	 	 	 	 	 	 	
			Tissue Expanders, Implants, And Methods Of Use

				 
	 	
			Europe

				 	 	
			15195295.9

				 	 	
			3023075

				 	 	 	 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Europe

				 	 	
			17153984.4

				 	 	
			3251631

				 	 	 	 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Europe

				 	 	
			14753579.3

				 	 	
			2958492

				 	 	 	 	 	
			Tissue Expanders, Implants, And Methods Of Use

				 
	 	
			Hong Kong

				 	 	
			16104644.4

				 	 	
			HK1216833

				 	 	 	 	 	
			Tissue Expanders, Implants, And Methods Of Use

				 
	 	
			Hong Kong

				 	 	
			16113463.3

				 	 	 	 	 	 	 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Japan

				 	 	
			2015-126321

				 	 	
			2015-180346

				 	 	 	 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			Japan

				 	 	
			2017-98713

				 	 	
			2017-159098

				 	 	 	 	 	
			Tissue Expanders And Methods Of Use

				 
	 	
			New Zealand

				 	 	
			712276

				 	 	 	 	 	 	 	 	
			Tissue Expanders, Implants, And Methods Of Use

				 

 

2

 

 

Trademarks

 

	 	
			MARK

				 	 	
			COUNTRY

				 	 	
			APP/REG NO.

				 	 	
			STATUS

				 
	 	
			AEROFORM

				 	 	
			USA

				 	 	
			App. No. 85/271,224

			 

			Reg. No. 4,289,578

				 	 	
			Filed 03/18/2011

			 

			Registered 02/12/2013

				 
	 	
			AIRXPANDER

				 	 	
			USA

				 	 	
			App. No. 77/633,102

			 

			Reg. No. 4,485,399

				 	 	
			Filed 12/15/2008

			 

			Registered 02/18/2014

				 
	 	
			AirXpanders Logo Design

			 

			

				 	 	
			USA

				 	 	
			App. No. 87/329,661

				 	 	
			Filed 02/09/2017

			 

			Office Action issued 05/05/2017; Response filed 10/06/2017

			 

			Examiner’s Amendment issued 11/20/2017

			 

			Published 01/02/2018

			 

			Allowed 02/27/2018

				 
	 	
			MMV

				 	 	
			USA

				 	 	
			App. No. 87/363,056

				 	 	
			Filed 03/08/2017

			 

			Office Action issued 05/05/2017; Response filed 10/06/2017

			 

			Examiner’s Amendment issued 11/20/2017

			 

			Published 01/02/2018

			 

			Allowed 02/27/2018

				 
	 	
			AEROFORM

				 	 	
			Australia

				 	 	
			App. No. 1449199

			 

			Reg. No. 1449199

				 	 	
			Filed 09/19/2011

			 

			Registered 01/16/2012

			 

			Non-Use Date 09/19/2014

				 
	 	
			AIRXPANDER

				 	 	
			Australia

				 	 	
			App. No. 1387614

			 

			Reg. No. 1387614

				 	 	
			Filed 10/08/2010

			 

			Registered 05/25/2011

			 

			Non-Use Date 10/08/2013

				 
	 	
			AIRXPANDER

				 	 	
			Canada

				 	 	
			App. No. 1829960

				 	 	
			Filed 03/29/2017

			 

			Published 04/11/2018

				 

 

 

 

	 	
			MARK

				 	 	
			COUNTRY

				 	 	
			APP/REG NO.

				 	 	
			STATUS

				 

	 	
			AEROFORM

				 	 	
			European Community

				 	 	
			App. No. 010272342

			 

			Reg. No. 010272342

				 	 	
			Filed 09/19/2011

			 

			Registered 02/23/2012

			 

			Non-Use Date 02/23/2017

				 
	 	
			AIRXPANDER

				 	 	
			European Community

				 	 	
			App. No. 009430241

			 

			Reg. No. 009430241

				 	 	
			Filed 10/07/2010

			 

			Registered 03/18/2011

			 

			Non-Use Date 03/18/2016

				 
	 	
			AEROFORM

				 	 	
			Japan

				 	 	
			App. No. 2011-67547

			 

			Reg. No. 5503732

				 	 	
			Filed 09/20/2011

			 

			Registered 06/29/2012

			 

			Non-Use Date 06/29/2015

				 
	 	
			AIRXPANDER

				 	 	
			Japan

				 	 	
			App. No. 2010-77883

			 

			Reg. No. 5482746

				 	 	
			Filed 10/05/2010

			 

			Registered 03/30/2012

			 

			Non-Use Date 03/30/2015

				 
	 	
			AIRXPANDER (Stylized)

			 

			

				 	 	
			USA

				 	 	
			App. No. 78/670,106

				 	 	
			Filed 07/14/2005

			 

			Published 10/10/2006

			 

			Allowed 01/02/2007

			 

			Notice of Abandonment issued 02/02/2009

			 

			Owner: Shalon Ventures Research LLC

				 
	 	
			AEROFORM

				 	 	
			Canada

				 	 	
			App. No. 1543907

				 	 	
			Filed 09/16/2011

			 

			Office Action issued 03/14/2012; Response filed 04/24/2012

			 

			Published 01/09/2013

			 

			Allowed 04/26/2013

			 

			Extension Request filed 07/30/2014; granted 08/14/2014

			 

			Extension Request filed 02/18/2015; granted 02/26/2015

			 

			Extension Request filed 07/22/2015; granted 08/04/2015

			 

			Extension Request filed 03/11/2016; granted 03/29/2016

			 

			Extension Request filed 08/12/2016; granted 08/18/2016

			 

			Extension Request filed 02/08/2017; granted 03/07/2017

			 

			Per client, allow application to become abandoned 07/12/2017

				 
	 	
			AIRXPANDER

				 	 	
			Canada

				 	 	
			App. No. 1499417

				 	 	
			Filed 10/12/2010

			 

			Office Action issued 02/16/2011; Response filed 03/11/2011

			 

			Accepted for Publication 05/31/2011

			 

			Allowed 12/02/2011

			 

			Extension Request filed 09/27/2013; granted 10/07/2013

			 

			Extension Request filed 04/11/2014; granted 04/17/2014

			 

			Extension Request filed 09/25/2014; granted 10/07/2014

			 

			Extension Request filed 03/18/2015; granted 03/26/2015

			 

			Extension Request filed 03/11/2016; granted 03/29/2016

			 

			Extension Request filed 08/12/2016; granted 08/18/2016

			 

			Extension Request filed 03/02/2017; denied 03/21/2017

			 

			Per client, allow application to become abandoned, refile 03/28/2017ex_118002.htm

Exhibit 10.2

 

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AS SET FORTH IN SECTION 5.3 BELOW, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY, SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

 

WARRANT TO PURCHASE STOCK

 

	
			Company:

				
			AirXpanders, Inc., a Delaware corporation

			
	
			Number of Shares:

				
			277,778

			
	
			Type/Series of Stock:

				
			Class A Common Stock

			
	
			Warrant Price:

				
			$0.32 per share 

			
	
			Issue Date:

				
			April 26, 2018

			
	
			Expiration Date:

				
			April 26, 2028 See also Section 5.1(b).

			
	
			Credit Facility:

				
			This Warrant to Purchase Stock (“Warrant”) is issued in connection with that certain Waiver and Second Amendment to Loan and Security Agreement of even date herewith among Oxford Finance LLC, as Lender and Collateral Agent, the Lenders from time to time party thereto, and the Company (as modified, amended and/or restated from time to time, the “Loan Agreement”).

			

 

THIS WARRANT CERTIFIES THAT, for good and valuable consideration, OXFORD FINANCE LLC (“Oxford” and, together with any successor or permitted assignee or transferee of this Warrant or of any shares issued upon exercise hereof, “Holder”) is entitled to purchase the number of fully paid and non-assessable shares (the “Shares”) of the above-stated Type/Series of Stock (the “Class”) of the above-named company (the “Company”) at the above-stated Warrant Price, all as set forth above and as adjusted pursuant to Section 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth in this Warrant.

 

SECTION 1.     EXERCISE.

 

1.1     Method of Exercise. Holder may at any time and from time to time prior to the Expiration Date (subject to Section 5.1(b)) exercise this Warrant, in whole or in part, by delivering to the Company the original of this Warrant together with a duly executed Notice of Exercise in substantially the form attached hereto as Appendix 1 and, unless Holder is exercising this Warrant pursuant to a cashless exercise set forth in Section 1.2, a check, wire transfer of same-day funds (to an account designated by the Company), or other form of payment acceptable to the Company for the aggregate Warrant Price for the Shares being purchased.

 

1.2     Cashless Exercise. On any exercise of this Warrant, in lieu of payment of the aggregate Warrant Price in the manner as specified in Section 1.1 above, but otherwise in accordance with the requirements of Section 1.1, Holder may elect to receive Shares equal to the value of this Warrant, or portion hereof as to which this Warrant is being exercised. Thereupon, the Company shall issue to the Holder such number of fully paid and non-assessable Shares as are computed using the following formula:

 

X = Y(A-B)/A

 

where:

 

	 	
			X =

				
			the number of Shares to be issued to the Holder;

			

 

	 	
			Y =

				
			the number of Shares with respect to which this Warrant is being exercised (inclusive of the Shares surrendered to the Company in payment of the aggregate Warrant Price);

			

 

	 	
			A =

				
			the Fair Market Value (as determined pursuant to Section 1.3 below) of one Share; and

			

 

	 	
			B =

				
			the Warrant Price.

			

 

1

 

 

1.3     Fair Market Value. If the Company’s common stock (or CHESS Depositary Interests (“CDIs”) representing the Company’s common stock) is then traded or quoted on the Australian Securities Exchange (“ASX”), a nationally recognized securities exchange, inter-dealer quotation system or over-the-counter market (a “Trading Market”) and the Class is common stock, the fair market value of a Share shall be the closing price or last sale price of a share of common stock (or in case of the CDIs trading on ASX, equal to the closing price of the Company’s CDIs on ASX multiplied by three and converted to US dollars at the prevailing Australian dollar to US dollar exchange rate as published by the Reserve Bank of Australia on the same day as the closing price is measured) reported for the Business Day immediately before the date on which Holder delivers this Warrant together with its Notice of Exercise to the Company. If the Company’s common stock or CDIs are not traded in a Trading Market, the Board of Directors of the Company shall determine the fair market value of a Share in its reasonable good faith judgment.

 

1.4     Delivery of Certificate and New Warrant. Within a reasonable time after Holder exercises this Warrant in the manner set forth in Section 1.1 or 1.2 above, the Company shall deliver to Holder a certificate representing the Shares issued to Holder upon such exercise and, if this Warrant has not been fully exercised and has not expired, a new warrant of like tenor representing the Shares not so acquired.

 

1.5    Replacement of Warrant. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form, substance and amount to the Company or, in the case of mutilation, on surrender of this Warrant to the Company for cancellation, the Company shall, within a reasonable time, execute and deliver to Holder, in lieu of this Warrant, a new warrant of like tenor and amount.

 

1.6     Treatment of Warrant Upon Acquisition of Company.

 

(a)     Acquisition. For the purpose of this Warrant, “Acquisition” means any transaction or series of related transactions involving: (i) the sale, lease, exclusive license, or other disposition of all or substantially all of the assets of the Company (ii) any merger or consolidation of the Company into or with another person or entity (other than a merger or consolidation effected exclusively to change the Company’s domicile), or any other corporate reorganization, in which the stockholders of the Company in their capacity as such immediately prior to such merger, consolidation or reorganization, own less than a majority of the Company’s (or the surviving or successor entity’s) outstanding voting power immediately after such merger, consolidation or reorganization (or, if such Company stockholders beneficially own a majority of the outstanding voting power of the surviving or successor entity as of immediately after such merger, consolidation or reorganization, such surviving or successor entity is not the Company); or (iii) any sale or other transfer by the stockholders of the Company of shares representing at least a majority of the Company’s then-total outstanding combined voting power.

 

(b)    Treatment of Warrant at Acquisition. In the event of an Acquisition in which the consideration to be received by the Company’s stockholders consists solely of cash, solely of Marketable Securities or a combination of cash and Marketable Securities (a “Cash/Public Acquisition”), either (i) Holder shall exercise this Warrant pursuant to Section 1.1 and/or 1.2 and such exercise will be deemed effective immediately prior to and contingent upon the consummation of such Cash/Public Acquisition or (ii) if Holder elects not to exercise the Warrant, this Warrant will expire immediately prior to the consummation of such Cash/Public Acquisition.

 

(c)     The Company shall provide Holder with written notice of its request relating to the Cash/Public Acquisition (together with such reasonable information as Holder may reasonably require regarding the treatment of this Warrant in connection with such contemplated Cash/Public Acquisition giving rise to such notice), which is to be delivered to Holder not less than seven (7) Business Days prior to the closing of the proposed Cash/Public Acquisition. In the event the Company does not provide such notice, then if, immediately prior to the Cash/Public Acquisition, the fair market value of one Share (or other security issuable upon the exercise hereof) as determined in accordance with Section 1.3 above would be greater than the Warrant Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be exercised pursuant to Section 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised, and the Company shall promptly notify the Holder of the number of Shares (or such other securities) issued upon such exercise to the Holder and Holder shall be deemed to have restated each of the representations and warranties in Section 4 of the Warrant as the date thereof.

 

2

 

 

(d)     Upon the closing of any Acquisition other than a Cash/Public Acquisition defined above, the acquiring, surviving or successor entity shall assume the obligations of this Warrant, and this Warrant shall thereafter be exercisable for the same securities and/or other property as would have been paid for the Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on and as of the closing of such Acquisition, subject to further adjustment from time to time in accordance with the provisions of this Warrant.

 

(e)     As used in this Warrant, “Marketable Securities” means securities meeting all of the following requirements: (i) the issuer thereof is then subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and is then current in its filing of all required reports and other information under the Act and the Exchange Act; (ii) the class and series of shares or other security of the issuer that would be received by Holder in connection with the Acquisition were Holder to exercise this Warrant on or prior to the closing thereof is then traded in Trading Market, and (iii) following the closing of such Acquisition, Holder would not be restricted from publicly re-selling all of the issuer’s shares and/or other securities that would be received by Holder in such Acquisition were Holder to exercise or convert this Warrant in full on or prior to the closing of such Acquisition, except to the extent that any such restriction (x) arises solely under federal or state securities laws, rules or regulations, and (y) does not extend beyond six (6) months from the closing of such Acquisition.

 

SECTION 2.     ADJUSTMENTS TO THE SHARES AND WARRANT PRICE.

 

2.1     ASX Listing Rules. For the period the Company is listed on the ASX, Sections 2.2 and 2.3 of this Warrant are subject to the listing rules applying to a reorganization of capital at the time of such reorganization as operated by ASX Limited (“ASX Listing Rules”). Notwithstanding any of the provisions of Sections 2.2 and 2.3 of this Warrant, to the extent of any inconsistency: (a) between Sections 2.2 or 2.3 of this Warrant and the ASX Listing Rules, the ASX Listing Rules prevail; and (b) between Sections 2.2 or 2.3, as applicable of this Warrant and the other terms of this Warrant, Sections 2.2 or 2.3 of this Warrant, as applicable, prevails; provided, that in no event shall the application of the ASX Listing Rules to Sections 2.2 or 2.3 of this Warrant result in Holder, or the Shares issuable to Holder upon exercise of this Warrant, being treated differently than the equityholders of other capital stock of the Company, or the capital stock of the Company held by such equityholders.

 

2.2     Stock Dividends, Splits, Etc. If the Company declares or pays a dividend or distribution on the outstanding shares of the Class payable in common stock or other securities or property (other than cash), then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without additional cost to Holder, the total number and kind of securities and property which Holder would have received had Holder owned the Shares of record as of the date the dividend or distribution occurred. If the Company subdivides the outstanding shares of the Class by reclassification or otherwise into a greater number of shares, the number of Shares purchasable hereunder shall be proportionately increased and the Warrant Price shall be proportionately decreased. If the outstanding shares of the Class are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be proportionately increased and the number of Shares shall be proportionately decreased.

 

2.3    Reclassification, Exchange, Combinations or Substitution. Upon any event whereby all of the outstanding shares of the Class are reclassified, exchanged, combined, substituted, or replaced for, into, with or by Company securities of a different class and/or series, then from and after the consummation of such event, this Warrant will be exercisable for the number, class and series of Company securities that Holder would have received had the Shares been outstanding on and as of the consummation of such event, and subject to further adjustment thereafter from time to time in accordance with the provisions of this Warrant. The provisions of this Section 2.2 shall similarly apply to successive reclassifications, exchanges, combinations substitutions, replacements or other similar events.

 

3

 

 

2.4     Reorganizations of Capital. In the event of any reorganization of capital of the Company (as specifically described in the ASX Listing Rules), the Number of Shares and Warrant Price under this Warrant will be changed to the extent necessary to comply with the ASX Listing Rules applying to a reorganization of capital at the time of such reorganization.

 

2.5     New Issues. Except as set forth in Sections 2.2 or 2.3 of this Warrant, nothing in this Warrant entitles Holder to participate in a new issue of securities by the Company, unless this Warrant is exercised.

 

2.6     Adjustments. Except in a reorganization of capital of the Company (as described in Sections 2.2 and 2.3) or as permitted by the ASX Listing Rules, Holder has no right to a change in Warrant Price, or a change to the Number of Shares over which the Warrant can be exercised.

 

2.7     No Fractional Share. No fractional Share shall be issuable upon exercise of this Warrant and the number of Shares to be issued shall be rounded down to the nearest whole Share. If a fractional Share interest arises upon any exercise of the Warrant, the Company shall eliminate such fractional Share interest by paying Holder in cash the amount computed by multiplying the fractional interest by (i) the fair market value (as determined in accordance with Section 1.3 above) of a full Share, less (ii) the then-effective Warrant Price.

 

2.8    Notice/Certificate as to Adjustments. Upon each adjustment of the Warrant Price, Class and/or number of Shares, the Company, at the Company’s expense, shall notify Holder in writing within a reasonable time setting forth the adjustments to the Warrant Price, Class and/or number of Shares and facts upon which such adjustment is based. The Company shall, upon written request from Holder, furnish Holder with a certificate of its Chief Financial Officer, including computations of such adjustment and the Warrant Price, Class and number of Shares in effect upon the date of such adjustment.

 

SECTION 3.     REPRESENTATIONS AND COVENANTS OF THE COMPANY.

 

3.1     Representations and Warranties. The Company represents and warrants to, and agrees with, the Holder as follows:

 

(a)     The initial Warrant Price referenced on the first page of this Warrant is not greater than the price per share at which shares of the Class were last sold on the Issue Date hereof.

 

(b)     All Shares which may be issued upon the exercise of this Warrant, and all securities shall, upon issuance, be duly authorized, validly issued, fully paid and non-assessable, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws. The Company covenants that it shall at all times cause to be reserved and kept available out of its authorized and unissued capital stock such number of shares of the Class, common stock and other securities as will be sufficient to permit the exercise in full of this Warrant.

 

3.2     Notice of Certain Events. If the Company proposes at any time to:

 

(a)     declare any dividend or distribution upon the outstanding shares of the Class or common stock, whether in cash, property, stock, or other securities and whether or not a regular cash dividend;

 

(b)     offer for subscription or sale pro rata to the holders of the outstanding shares of the Class any additional shares of any class or series of the Company’s stock (other than pursuant to contractual pre-emptive rights);

 

(c)     effect any reclassification, exchange, combination, substitution, reorganization or recapitalization of the outstanding shares of the Class; or

 

4

 

 

(d)     effect an Acquisition or to liquidate, dissolve or wind up;

 

then, in connection with each such event, the Company shall give Holder:

 

(1)     at least seven (7) Business Days prior written notice of the date on which a record will be taken for such dividend, distribution, or subscription rights (and specifying the date on which the holders of outstanding shares of the Class will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (a) and (b) above; and

 

(2)     in the case of the matters referred to in (c) and (d) above at least seven (7) Business Days prior written notice of the date when the same will take place (and specifying the date on which the holders of outstanding shares of the Class will be entitled to exchange their shares for the securities or other property deliverable upon the occurrence of such event).

 

Reference is made to Section 1.6(c) whereby this Warrant will be deemed to be exercised pursuant to Section 1.2 hereof if the Company does not give written notice to Holder of a Cash/Public Acquisition as required by the terms hereof. The Company will also provide information requested by Holder that is reasonably necessary to enable Holder to comply with Holder’s accounting or reporting requirements. In handling any confidential information of the Company, including the information requested pursuant to this Section 3.2, the Holder shall exercise the same degree of care specified in Section 12.9 of the Loan Agreement.

 

SECTION 4.     REPRESENTATIONS, WARRANTIES OF THE HOLDER.

 

The Holder represents and warrants to the Company as follows:

 

4.1     Purchase for Own Account. This Warrant and the securities to be acquired upon exercise of this Warrant by Holder are being acquired for investment for Holder’s account, not as a nominee or agent, and not with a view to the public resale or distribution within the meaning of the Act. Holder also represents that it has not been formed for the specific purpose of acquiring this Warrant or the Shares.

 

4.2    Disclosure of Information. Holder is aware of the Company’s business affairs and financial condition and has received or has had full access to all the information it considers necessary or appropriate to make an informed investment decision with respect to the acquisition of this Warrant and its underlying securities. Holder further has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of this Warrant and its underlying securities and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify any information furnished to Holder or to which Holder has access.

 

4.3    Investment Experience. Holder understands that the purchase of this Warrant and its underlying securities involves substantial risk. Holder has experience as an investor in securities of companies in the development stage and acknowledges that Holder can bear the economic risk of such Holder’s investment in this Warrant and its underlying securities and has such knowledge and experience in financial or business matters that Holder is capable of evaluating the merits and risks of its investment in this Warrant and its underlying securities and/or has a preexisting personal or business relationship with the Company and certain of its officers, directors or controlling persons of a nature and duration that enables Holder to be aware of the character, business acumen and financial circumstances of such persons.

 

4.4    Accredited Investor Status. Holder is an “accredited investor” within the meaning of Regulation D promulgated under the Act.

 

5

 

 

4.5    The Act. Holder understands that this Warrant and the Shares issuable upon exercise hereof have not been registered under the Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the Holder’s investment intent as expressed herein. Holder understands that this Warrant and the Shares issued upon any exercise hereof must be held indefinitely unless subsequently registered under the Act and qualified under applicable state securities laws, or unless exemption from such registration and qualification are otherwise available. Holder is aware of the provisions of Rule 144 promulgated under the Act.

 

4.6     No Voting Rights. Holder, as a Holder of this Warrant, will not have any voting rights until the exercise of this Warrant.

 

SECTION 5.     MISCELLANEOUS.

 

5.1     Term; Automatic Cashless Exercise Upon Expiration.

 

(a)     Term. Subject to the provisions of Section 1.6 above, this Warrant is exercisable in whole or in part at any time and from time to time on or before 6:00 PM, Eastern time, on the Expiration Date and shall be void thereafter.

 

(b)     Automatic Cashless Exercise upon Expiration. In the event that, upon the Expiration Date, the fair market value of one Share (or other security issuable upon the exercise hereof) as determined in accordance with Section 1.3 above is greater than the Warrant Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be exercised pursuant to Section 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised, and the Company shall, within a reasonable time, deliver a certificate representing the Shares (or such other securities) issued upon such exercise to Holder.

 

5.2     Legends. Each certificate evidencing Shares shall be imprinted with a legend in substantially the following form:

 

THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AS SET FORTH IN THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED BY THE ISSUER TO OXFORD FINANCE LLC DATED APRIL 26, 2018, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER, SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

 

5.3     Compliance with Securities Laws on Transfer. This Warrant and the Shares issued upon exercise of this Warrant may not be transferred or assigned in whole or in part except in compliance with applicable U.S. federal and state securities laws and Australian laws (including the ASX Listing Rules) by the transferor and the transferee (including, without limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to the Company, as reasonably requested by the Company). The Company shall not require Holder to provide an opinion of counsel if the transfer is to an affiliate of Holder, provided that any such transferee is an “accredited investor” as defined in Regulation D promulgated under the Act. Additionally, the Company shall also not require an opinion of counsel if there is no material question as to the availability of Rule 144 promulgated under the Act.

 

5.4     Reserved.

 

5.5     Transfer Procedure. After receipt by Oxford of the executed Warrant, Oxford may transfer all or part of this Warrant to one or more of Oxford’s affiliates (each, an “Oxford Affiliate”), by execution of an Assignment substantially in the form of Appendix 2. Subject to the provisions of Article 5.3 and upon providing the Company with written notice, Oxford, any such Oxford Affiliate and any subsequent Holder, may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant to any other transferee, provided, however, in connection with any such transfer, the Oxford Affiliate(s) or any subsequent Holder will give the Company notice of the portion of the Warrant being transferred with the name, address and taxpayer identification number of the transferee and Holder will surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable); and provided further, that any subsequent transferee shall agree in writing with the Company to be bound by all of the terms and conditions of this Warrant.

 

6

 

 

5.6     Notices. All notices and other communications hereunder from the Company to the Holder, or vice versa, shall be deemed delivered and effective (i) when given personally, (ii) on the third (3rd) Business Day after being mailed by first-class registered or certified mail, postage prepaid, (iii) upon actual receipt if given by facsimile or electronic mail and such receipt is confirmed in writing by the recipient, or (iv) on the first Business Day following delivery to a reliable overnight courier service, courier fee prepaid, in any case at such address as may have been furnished to the Company or Holder, as the case may be, in writing by the Company or such Holder from time to time in accordance with the provisions of this Section 5.5. All notices to Holder shall be addressed as follows until the Company receives notice of a change of address in connection with a transfer or otherwise:

 

 Oxford Finance LLC

133 N. Fairfax Street

Alexandria, VA 22314

Attn: Legal Department

Telephone: (703) 519-4900

Facsimile: (703) 519-5225

Email: LegalDepartment@oxfordfinance.com

 

Notice to the Company shall be addressed as follows until Holder receives notice of a change in address:

 

AirXpanders, Inc.

1047 Elwell Court

Palo Alto, CA 94303

Attn: Scott Murcray, CFO/COO

Fax: 650-390-9007

Email: SMurcray@airxpanders.com

 

With a copy (which shall not constitute notice) to:

 

Cooley LLP

3175 Hanover Street

Palo Alto, CA 94304

Attn: Mark Weeks

Fax: 650-849-7400

Email: mweeks@cooley.com

 

5.7     Waiver. This Warrant and any term hereof may be changed, waived, discharged or terminated (either generally or in a particular instance and either retroactively or prospectively) only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought.

 

5.8     Attorneys’ Fees. In the event of any dispute between the parties concerning the terms and provisions of this Warrant, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including reasonable attorneys’ fees.

 

5.9     Counterparts; Facsimile/Electronic Signatures. This Warrant may be executed in counterparts, all of which together shall constitute one and the same agreement. Any signature page delivered electronically or by facsimile shall be binding to the same extent as an original signature page with regards to any agreement subject to the terms hereof or any amendment thereto.

 

5.10    Governing Law. This Warrant shall be governed by and construed in accordance with the laws of the State of California, without giving effect to its principles regarding conflicts of law.

 

5.11     Headings. The headings in this Warrant are for purposes of reference only and shall not limit or otherwise affect the meaning of any provision of this Warrant.

 

5.12     Business Days. “Business Day” is any day that is not a Saturday, Sunday or a day on which banks in the State of California are closed.

 

 

 

[Remainder of page left blank intentionally]

 

[Signature page follows]

 

7

 

 

IN WITNESS WHEREOF, the parties have caused this Warrant to Purchase Stock to be executed by their duly authorized representatives effective as of the Issue Date written above.

 

	
			“COMPANY”

				 	 
	 	 	 	 
	
			AIRXPANDERS, INC.

				 	 
	 	 	 	 
	 	 	 	 
	
			By:

				 	 	 
	 	 	 	 
	
			Name:

				 	 	 
	
			 

				(Print)	 	 
	
			Title:

				 	 	 
	 	 	 	 
	 	 	 	 
	
			“HOLDER”

				 	 
	 	 	 	 
	 	 	 	 
	
			OXFORD FINANCE LLC

				 	 
	 	 	 	 
	 	 	 	 
	
			By:

				 	 	 
	 	 	 	 
	
			Name:

				 	 	 
	
			 

				(Print)	 	 
	
			Title:

				 	 	 

 

 

 

 

[Signature Page to Warrant to Purchase Stock]

 

 

 

 

APPENDIX 1

 

NOTICE OF EXERCISE

 

1.     The undersigned Holder hereby exercises its right purchase ___________ shares of the Class A Common Stock of AirXpanders, Inc. (the “Company”) in accordance with the attached Warrant To Purchase Stock, and tenders payment of the aggregate Warrant Price for such shares as follows:

 

	 	
			[  ]

				
			check in the amount of $________ payable to order of the Company enclosed herewith

			

 

	 	
			[  ]

				
			Wire transfer of immediately available funds to the Company’s account

			

 

	 	
			[  ]

				
			Cashless Exercise pursuant to Section 1.2 of the Warrant

			

 

	 	
			[  ]

				
			Other [Describe] __________________________________________

			

 

2.     Please issue a certificate or certificates representing the Shares in the name specified below:

 

 

	Holder’s Name
	 
	 
	 
	 
	(Address)

 

3.     By its execution below and for the benefit of the Company, Holder hereby restates each of the representations and warranties in Section 4 of the Warrant to Purchase Stock as of the date hereof.

 

	 	 	
			HOLDER:

			
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	
			By:

				 
	 	 	 	 
	 	 	
			Name:

				 
	 	 	 	 
	 	 	
			Title:

				 
	 	 	 	 
	 	 	
			Date:

				 

 

Appendix 1

 

 

APPENDIX 2

 

ASSIGNMENT

 

For value received, Oxford Finance LLC hereby sells, assigns and transfers unto

 

Name:               [OXFORD TRANSFEREE]

 

Address:                                                            

 

Tax ID:                                                                   ]

 

that certain Warrant to Purchase Stock issued by AirXpanders, Inc. (the “Company”), on April 27, 2018 (the “Warrant”) together with all rights, title and interest therein.

 

	 	 	
			OXFORD FINANCE LLC

			
	 	 	 	 
	 	 	 	 
	 	 	
			By:

				 
	 	 	 	 
	 	 	
			Name:

				 
	 	 	 	 
	 	 	
			Title:

				 
	 	 	 	 
	
			Date:

				 	 	 

 

By its execution below, and for the benefit of the Company, [OXFORD TRANSFEREE] makes each of the representations and warranties set forth in Article 4 of the Warrant and agrees to all other provisions of the Warrant as of the date hereof.

 

	 	 	
			[OXFORD TRANSFEREE]

			
	 	 	 	 
	 	 	
			By:

				 
	 	 	 	 
	 	 	
			Name:

				 
	 	 	 	 
	 	 	
			Title:

				]

 

Appendix 2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00285-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00285-of-00352.parquet"}]]