SECOND AMENDMENT
TO
THIRD AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT
THIS SECOND AMENDMENT TO THIRD AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
(this “Amendment”) is entered into this 25th day of September 2015, by and
between SILICON VALLEY BANK, a California banking corporation (“Bank”) and
QUICKLOGIC CORPORATION, a Delaware corporation (“Borrower”) whose address is
1277 New Orleans Drive, Sunnyvale, CA 94089-1138.
RECITALS
A.Bank and Borrower have entered into that certain Third Amended and Restated
Loan and Security Agreement dated as of June 30, 2014, as amended by that
certain Amendment Number One to Third Amended and Restated Loan and Security
Agreement dated as of September 26, 2014 (as the same may from time to time be
further amended, modified, supplemented or restated, the “Loan Agreement”).
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 make certain
revisions, each as more fully set forth herein.
D.Bank has agreed to so 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.
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.
2.Amendments to Loan Agreement.

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2.1    Section 2.1.1(b) (Incremental Facility). Section 2.1.1(b) of the Loan
Agreement is hereby amended and restated in its entirety and replaced with the
following:
“(b) Incremental Facility. On one or more occasions during the term of this
Agreement, Borrower may request that Bank increase the Committed Non-Formula
Revolving Line in a minimum amount of $1,000,000 (and in integral multiples of
$1,000,000 in excess thereof) and in an aggregate amount for all such requests
of up to $6,000,000. Amounts borrowed in conjunction with any and all increases
in the Non-Formula Revolving Line pursuant to this Section shall constitute
Non-Formula Advances for all purposes under this Agreement and shall be subject
to the same terms and conditions as all other Non-Formula Advances.”
2.2    Section 2.1.6(c) (Prepayment). A new Section 2.1.6(c) is hereby added
to the Loan Agreement immediately after Section 2.1.6(b) of the Loan Agreement
as follows:
“(c) Prepayment in Full or Early Termination. Notwithstanding anything to the
contrary in the foregoing Sections 2.1.6(a) and 2.1.6(b) hereof, any prepayment
of all principal and accrued interest or termination of this Agreement by
Borrower within the first anniversary of the Second Amendment Effective Date is
subject to the fee set forth in Section 2.4(d).”
2.3    Section 2.4(b) (Fees). Section 2.4(b) of the Loan Agreement is hereby
amended and restated in its entirety and replaced with the following:
“(b)Revolving Line of Credit Fee. A non-refundable Committed Non-Formula
Revolving Line fee, fully earned on the Second Amendment Effective Date and due
and payable (a) within 10 Business Days of the Second Amendment Effective Date
in an amount equal to $17,500, and (b) on the first anniversary of the Second
Amendment Effective Date, in an amount equal to $15,000.”
2.4    Section 2.4(c) (Fees). Section 2.4(c) of the Loan Agreement is hereby
amended and restated in its entirety and replaced with the following:
“(c)Unused Line Fee. A fee payable quarterly, payable in arrears, on a calendar
year basis, in an amount equal to one thirty-fifth of one percent (0.35%) per
annum of the average unused portion of the Committed Non-Formula Revolving Line,
as determined by Bank.
2.5    Section 2.4(d) (Fees). A Section 2.4(d) is hereby added immediately
after Section 2.4(c) of the Loan Agreement as follows:

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“(b)Early Termination Fee. Upon termination of this Agreement for any reason
prior to the Revolving Maturity Date, in addition to the payment of any other
amounts then-owing, a termination fee in an amount equal to one percent (1.00%)
of the Committed Non-Formula Revolving Line if such termination occurs prior to
the first anniversary of the Second Amendment Effective Date; provided that no
termination fee shall be charged if the credit facility hereunder is replaced
with a new facility from Bank.”
2.6    Section 6.8 (Financial Covenants). Section 6.8 of the Loan Agreement
is hereby amended and restated in its entirety and replaced with the following:
“6.8 Financial Covenants. Borrower will comply with each of the following
financial covenants:
(a)Tangible Net Worth. A Tangible Net Worth of at least the amount equal to (i)
$12,000,000 plus (ii) 50% of the amount of all proceeds from any equity issuance
of Borrower, plus (iii) 50% of the amount of all proceeds from any investment of
Borrower, tested as of the last day of each fiscal quarter of Borrower.
(b)Quick Ratio (Adjusted). Borrower will maintain a ratio of (a) Quick Assets to
(b) the result of (i) Current Liabilities minus (ii) the current portion of
Deferred Revenue plus (iii) the long-term portion of the Obligations, of at
least 1.10 to 1.00, tested as of the last day of each month.
(c)Cash. Unrestricted cash or Cash Equivalents at Bank or at any of Bank’s
Affiliates at all times in an amount of at least $6,000,000, tested as of the
last day of each month.”
2.7    Section 13 (Definitions).
(a)    Committed Non-Formula Revolving Line. The definition of
“Committed Non-Formula Revolving Line” set forth in Section 13.1 of the Loan
Agreement is hereby amended and restated in its entirety and replaced with the
following:
““Committed Non-Formula Revolving Line” is Non-Formula Advances of up to
$6,000,000, subject to increase at Borrower’s election to up to $12,000,000 in
accordance with Section 2.2.1(b).”
(a)Current Liabilities. A new definition of “Current Liabilities” is hereby
added to Section 13.1 of the Loan Agreement in its proper alphabetical order, as
follows:

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““Current Liabilities” are all obligations and liabilities of Borrower to Bank,
plus, without duplication, the aggregate amount of Borrower’s Total Liabilities
that mature within one (1) year.”
(b)Deferred Revenue. A new definition of “Deferred Revenue” is hereby added to
Section 13.1 of the Loan Agreement in its proper alphabetical order, as follows:
““Deferred Revenue” is all amounts received or invoiced in advance of
performance under contracts and not yet recognized as revenue.”
(c)Revolving Maturity Date. The definition of “Revolving Maturity Date” set
forth in Section 13.1 of the Loan Agreement is hereby amended and restated in
its entirety and replaced with the following:
““Revolving Maturity Date” is September 25, 2017.”
(d)Second Amendment Effective Date. The definition of “Second Amendment
Effective Date” is hereby added to Section 13.1 of the Loan Agreement in
appropriate alphabetical order as set forth below:
““Second Amendment Effective Date” is the date of the Second Amendment to Third
Amended and Restated Loan and Security Agreement.”
(e)    Total Liabilities. A new definition of “Total Liabilities” is hereby
added to Section 13.1 of the Loan Agreement in its proper alphabetical order, as
follows:
““Total Liabilities” is on any day, obligations that should, under GAAP, be
classified as liabilities on Borrower’s consolidated balance sheet, including
all Indebtedness.”
2.8    Exhibits. Exhibit C of the Loan Agreement is hereby amended and
restated in its entirety with Exhibit C set forth in Exhibit A attached hereto.
3.Limitation of Amendments.
3.1    The amendments set forth in Section 2, above, are 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

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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.
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 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 Agreement, as amended by
this Amendment;
4.3    The organizational documents of Borrower delivered to Bank on the
Closing 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 Agreement, as amended
by this Amendment, have been duly authorized;
4.5    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 (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 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 either Borrower, except as already has been obtained or
made; and
4.7    This Amendment has been duly executed and delivered by Borrower and

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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.Integration. This Amendment and the Loan Documents represent the entire
agreement about this subject matter and supersede prior negotiations or
agreements. All prior agreements, understandings, representations, warranties,
and negotiations between the parties about the subject matter of this Amendment
and the Loan Documents merge into this Amendment and the Loan Documents.
6.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.
7.Effectiveness. This Amendment shall be deemed effective upon the due execution
and delivery to Bank of this Amendment by each party hereto.
[Signature Pages Follow]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered as of the date first written above.
                    
BORROWER
QUICKLOGIC CORPORATION
By: //s// SUE CHEUNG
Name: Sue Cheung
Title: Principal Accounting Officer & Corporate Controller

BANK    
SILICON VALLEY BANK

By: //s// WENDY WONG

Name: Wendy Wong    

Title:    Vice President    

SECOND AMENDMENT TO THIRD AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

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EXHIBIT A
EXHIBIT C

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FORM OF COMPLIANCE CERTIFICATE
QUICKLOGIC CORPORATION
TO:    SILICON VALLEY BANK
3003 Tasman Drive Santa Clara, CA 95054
FROM:    QUICKLOGIC CORPORATION
1227 Orleans Drive
Sunnyvale, CA 94089-1138
The undersigned authorized officer (“Officer”) of QuickLogic Corporation
(“Borrower”) certifies that under the terms and conditions of the Third Amended
and Restated Loan and Security Agreement between Borrower and Silicon Valley
Bank (as amended, restated, supplemented or other modified from time to time,
the “Agreement”), (i) Borrower is incomplete compliance for the period
ending__________    with all required covenants except as noted below and (ii)
all representations and warranties in the Agreement are true and correct in all
material respects on this date, except for representations and warranties made
as of a specific earlier date, which are to be true and correct in all material
respects as of such earlier date. Attached are the required documents supporting
the certification. The Officer certifies that these are prepared in accordance
with Generally Accepted Accounting Principles (GAAP) consistently applied from
one period to the next except as explained in an accompanying letter, footnotes
or year-end adjustments. The Officer acknowledges that no borrowings may be
requested at any time or date of determination that Borrower is not in
compliance with any of the terms of the Agreement, and that compliance is
determined not just at the date this certificate is delivered.
Please indicate compliance status by circling Yes/No under “Complies” column.

Exhibit A
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Reporting and Financial Covenants
Required
Complies
Monthly financial statements,
Monthly within 45 days
Yes
No
Compliance Certificate
 
 
 
Board Approved Projections
Annual within 60 days of FYE or the date provided to Borrowers’ Board
Yes
No
Accounts Payable and Accounts Receivable Listings
Within 30 days of the end of each month
Yes
No
10-Q, 10-K, and 8-K
Within 5 days after filing with SEC
Yes
No
Minimum Tangible Net Worth
Quarterly; ≥$12,000,000 + 50% equity issuance proceeds + 50% investment proceeds
Yes
No
Quick Ratio Adjusted
Monthly; ≥ 1.10 to 1.00
Yes
No
Minimum Cash
Monthly; ≥ $6,000,000
Yes
No

Exhibit A
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Have there been updates to Borrower’s intellectual property, if
appropriate?    Yes    No
The following financial covenant analys[is][es] and information set forth in
Schedule 1 attached hereto are true and accurate as of the date of this
Certificate.
The following are the exceptions with respect to the certification above: (If no
exceptions exist, state “No exceptions to note.”)
[Signature page follows]

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QUICKLOGIC CORPORATION
 
BANK USE ONLY
Received by:
By:
AUTHORIZED SIGNER
Name:
________________________________
 
Date:
 
 
Title:
Verified:

 _____________________________
 
 
 
AUTHORIZED SIGNER
 
 
 
Date:
 
 
 
 
 
 
 
 

Compliance Status: Yes No

Exhibit A
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Schedule 1 to Compliance Certificate
Financial Covenants of Borrower

Calculations as of:    ____________________

I.    TANGIBLE NET WORTH (Section 6.8(a))

Required:             

A.

$12,000,000

$12,000,000
B.
50% of proceeds from any equity issuance of Borrower
$__________
C.
50% of proceeds from any investments of Borrower
$__________
D.
Required Amount (line A + line B + line C)
$__________

Actual:

E.
Borrower’s actual Tangible Net Worth
$__________
 
 
 

Is line E equal to or greater than line D?

¨ No, not in compliance    ¨ Yes, in compliance

II.    ADJUSTED QUICK RATIO (Section 6.8(b))

Required:    1.10:1.00

Actual:

Exhibit A
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A.
Aggregate value of the unrestricted cash and cash equivalents of
Borrower and its Subsidiaries held at Bank
$__________
B.
Aggregate value of the net billed accounts receivable of Borrower
and its Subsidiaries
$__________
C.
Aggregate value of the Investments with maturities of fewer than 12 months of
Borrower and its Subsidiaries held at Bank or its affiliates
$__________
D.
Quick Assets (the sum of lines A through C)
$__________
E.
Current Liabilities
$__________
F.
the current portion of Deferred Revenue
$__________

Exhibit A
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G.
the long-term portion of the aggregate value of Obligations to Bank
$__________
H.
line E minus line F plus line G
$__________
F.
Quick Ratio (line D divided by line H)
$__________

Is line F equal to or greater than 1.10:1.00?

¨ No, not in compliance    ¨ Yes, in compliance

III.    CASH (Section 6.8(c))

Required:    $6,000,000

Actual:

A.
Value of Line III. (Cash)
$__________

Is line A equal to or greater than $6,000,000?

¨ No, not in compliance    ¨ Yes, in compliance

Exhibit A
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PRO FORMA INVOICE FOR LOAN CHARGES

BORROWER:
QUICKLOGIC CORPORATION

LOAN OFFICER:        ____________

DATE:                ____________

Loan Fee    $_____
Documentation Fee    _____

TOTAL FEES DUE    $______

{ } A check for the total amount is attached.

{ } Debit DDA # __________________ for the total amount.

    

BORROWER:

                    
Authorized Signer        (Date)

SILICON VALLEY BANK

                    
Loan Officer Signature        (Date)

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