PHASEBIO PHARMACEUTICALS INC: Entering into a Material Definitive Agreement, Creating a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Holder (Form 8-K)

Section 1.01 Entering into a Material Definitive Agreement.

As stated earlier, PhaseBio Pharmaceuticals, Inc. (the “Company”) entered into a loan and guarantee agreement, dated March 25, 2019 (as amended by this Consent and First Amendment to the Loan and Guarantee Agreement dated March 19, 2020the “Loan Agreement”), with Bank of Silicon Valley (“SVB”), as administrative agent and collateral agent, SVB, as lender, and
SVB Innovation Credit Fund VIII, LP (formerly known as WestRiver VIII Innovation Loan Fund, LP, “SVB Innovation”), as a lender. On October 3, 2022SVB, SVB Innovation (collectively, “Assignor”) and JMB Capital Partners Lending, LLC (“JMB”) has entered into a non-recourse Loan Document Sale and Assignment Agreement (the “Assignment Agreement”), pursuant to which the Assignor has sold and assigned to JMB all rights, titles, interests and obligations of assignor under (i) the loan agreement, (ii) certain subordination agreements, dated
March 19, 2020by and among SFJ Pharmaceuticals X, Ltd. (“SFJ”) and the assignor (the “Subordination Agreement”) and (iii) that certain Intellectual Property Security Agreements, dated March 19, 2020, by and between the Company and the Grantor (the “IP Collateral Agreement” and, together with the Loan Agreement and Subordination Agreement, the “Loan Documents”) in exchange for, among other things, payment in full of all principal unpaid and accrued interest under the loan agreement. The Assignment Agreement provided for SVB to resign as Agent under the Loan Documents and for JMB to become Successor Agent under the Loan Documents.

Under the Assignment Agreement, the October 3, 2022, the Company has entered into a second amendment (the “Second Amendment”) to the loan agreement with JMB, as assignee of SVB, in its capacity as administrative agent and collateral agent, and JMB, as lender . Pursuant to the Second Amendment, JMB became the successor lender and agent under the terms of the loan agreement. Under the Second Amendment, JMB has agreed to make additional advances to the Company as Tranche A Growth Capital Advances (as defined in the Loan Agreement) from time to time in an amount up to $6.25 million, at an initial issue price of eighty percent (80%) of the total amount so advanced. Efficient October 4, 2022the company borrowed $6.25 million at an original issue price of eighty percent (80%) as Tranche A Growth Capital Advances under the Loan Agreement, as amended by the Second Amendment. In addition, among other things, the Second Amendment revised the definition of a “material adverse change” under the loan agreement to exclude the occurrence or inability to cure the going concern condition ( as defined in this co-development agreement, dated January 9, 2020by and between the Company and SFJ (the “Co-Development Agreement”), SFJ’s delivery of Program Transfer Notice (as defined in the Co-Development Agreement) or the taking of any action with respect to the above.

In connection with the Second Amendment, the Company and JMB have entered into an Intellectual Property Security Agreement, dated October 7, 2022 (the “Additional IP Security Agreement”), granting JMB a security interest in all of the Company’s intellectual property that has not already been registered by SVB in United States Patent and Trademark Office under the Intellectual Property Security Agreement.

The foregoing description of the Second Amendment and Supplemental IP Security Agreement does not purport to be complete and is subject to and qualified in its entirety by reference to the terms of the agreements, copies of which will be filed with the Company’s Quarterly Report. on Form 10-Q for the quarter ended
September 30, 2022.

Item 2.03       Creation of a Direct Financial Obligation or an Obligation under an Off-Balance
                Sheet Arrangement of the Registrant.

The information set forth in Section 1.01 of this Current Report on Form 8-K is incorporated by reference into this Section 2.03.

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