Exhibit 10.2

FIRST AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is
entered into this 6th day of July, 2018, by and between SILICON VALLEY BANK, a
California corporation (“Bank”), and EVERSPIN TECHNOLOGIES, INC., a Delaware
corporation (“Borrower”).

RECITALS

A.  Bank and Borrower have entered into that certain Loan and Security Agreement
dated as of May 4, 2017 (as the same may from time to time be 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 to the Loan Agreement as more fully set forth herein.

D.  Bank has agreed 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.

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.

2.1       Section 2.1.1  (Term Loan Advance). Section 2.1.1(c) of the Loan
Agreement is hereby deleted in its entirety and replaced with the following:

(c)        Prepayment.

(i)         Voluntary Prepayment.  Borrower shall have the option to prepay all
or any portion of the Term Loan Advances advanced by Bank under this Agreement,
provided Borrower (A) delivers written notice to Bank of its election to prepay
the Term Loan Advances at least ten (10) days prior to such prepayment, and
(B) pays, on the date of such prepayment (1) all accrued and unpaid interest
with respect to such Term Loan Advances being prepaid through the date the
prepayment is made, plus (2) all unpaid

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principal with respect to such Term Loan Advances being prepaid, plus (3) the
Final Payment, plus (4) the Prepayment Fee, plus (5) all other sums, if any,
that shall have become due and payable hereunder in connection with the Term
Loan Advances, including interest at the Default Rate with respect to any past
due amounts.

(ii)       Mandatory Prepayment Upon an Acceleration.  If the Term Loan Advance
is accelerated following the occurrence of an Event of Default or otherwise,
Borrower shall immediately pay to Bank an amount equal to the sum of (A) all
accrued and unpaid interest with respect to the Term Loan Advance through the
date the prepayment is made, plus (B) all outstanding principal with respect to
the Term Loan Advance, plus (C) the Final Payment, plus (D) the Prepayment Fee,
plus (E) all other sums, if any, that shall have become due and payable
hereunder in connection with the Term Loan Advance.

2.2       Section 2.3  (Fees).  Section 2.3(e) is hereby inserted in the Loan
Agreement immediately following Section 2.3(d) of the Loan Agreement:

(e)        Prepayment Fee.  The Prepayment Fee, when due hereunder.

2.3       Section 6.2  (Financial Statements, Reports,
Certificates).  Section 6.2(i) is hereby inserted in the Loan Agreement
immediately following Section 6.2(h) of the Loan Agreement:

(i)         Beneficial Ownership Information.  Borrower shall provide Bank with
prompt written notice of any changes to the beneficial ownership information set
out in the Beneficial Ownership Information Disclosure Form.  Borrower
understands and acknowledges that Bank relies on such true, accurate and
up-to-date beneficial ownership information to meet Bank’s regulatory
obligations to obtain, verify and record information about the beneficial owners
of its legal entity customers.

2.4       Section 6.7  (Financial Covenants).  Section 6.7 of the Loan Agreement
is hereby deleted in its entirety and replaced with the following:

6.7       Financial Covenants.  Maintain at all times, subject to periodic
reporting as of the last day of each month, unless otherwise noted, on a
consolidated basis with respect to Borrower and its Subsidiaries:

(a)        Liquidity Ratio.  As of the last day of each month, a Liquidity Ratio
of not less than (i) 1.25:1.00 for each month prior to Borrower achieving the
Extension Milestone, and (ii) 1.50:1.00 for each month after Borrower achieves
the Extension Milestone.

(b)        Performance to Plan.  As of the last day of each month, Borrower’s
TFS Revenue for such month calculated on a cumulative fiscal year to date basis,
shall be equal to or greater than the amount set forth for such month on
Schedule 1 of the Compliance Certificate.

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Commencing with the month ending January 31, 2020, the Performance to Plan
financial covenant set forth in this Section shall be calculated based on the
annual financial projections approved by Borrower’s  Board of Directors and
delivered and accepted by Bank for the 2020 fiscal year (the “2020 Performance
to Plan Financial Covenant”).  Borrower and Bank shall negotiate in good faith
to reach an agreement on such 2020 Performance to Plan Financial Covenant and,
upon reaching such agreement, will execute and deliver to Bank an amendment to
this Agreement which provides the terms for the 2020 Performance to Plan
Financial Covenant no later than February 28, 2020.

2.5       Section 6.10 (Access to Collateral; Books and Records).  The last
paragraph of Section 6.10 of the Loan Agreement is hereby deleted in its
entirety and replaced with the following:

“In the event Borrower and Bank schedule an audit more than eight (8) days in
advance, and Borrower cancels or seeks to or reschedules the audit with less
than eight (8) days written notice to Bank, then (without limiting any of Bank’s
rights or remedies) Borrower shall pay Bank a fee of Two Thousand Dollars
($2,000) plus any out-of-pocket expenses incurred by Bank to compensate Bank for
the anticipated costs and expenses of the cancellation or rescheduling.”

2.6       Section 12.2  (Successors and Assigns).  Section 12.2 of the Loan
Agreement is hereby deleted in its entirety and replaced with the following:

12.2     Successors and Assigns.  This Agreement binds and is for the benefit of
the successors and permitted assigns of each party.  Borrower may not assign
this Agreement or any rights or obligations under it without Bank’s prior
written consent (which may be granted or withheld in Bank’s discretion).  Bank
has the right, without the consent of or notice to Borrower, to sell, transfer,
assign, negotiate, or grant participation in all or any part of, or any interest
in, Bank’s obligations, rights, and benefits under this Agreement and the other
Loan Documents (other than the Warrant, as to which assignment, transfer and
other such actions are governed by the terms thereof).

2.7       Section 13  (Definitions).

(a)        The following terms and their respective definitions set forth in
Section 13.1 of the Loan Agreement are hereby deleted in their entirety and
replaced with the following:

“Applicable Number” means (a) twenty-four (24) if Borrower does not achieve the
Extension Milestone, and (b) thirty-six (36) if Borrower achieves the Extension
Milestone.

“Final Payment Percentage” is, for each Term Loan Advance, equal to seven
percent (7.00%).

“Interest-Only Period” is the period of time from the Effective Date through
December 31, 2018.

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“Loan Documents” are, collectively, this Agreement and any schedules, exhibits,
certificates, notices, and any other documents related to this Agreement, any
Bank Services Agreement, the Warrant, any subordination agreement, any note, or
notes or guaranties executed by Borrower or any guarantor, and any other present
or future agreement by Borrower and/or any guarantor with or for the benefit of
Bank in connection with this Agreement or Bank Services, all as amended,
restated, or otherwise modified.

“Obligations” are Borrower’s obligations to pay when due any debts, principal,
interest, fees, Bank Expenses, the Final Payment, the Prepayment Fee, and other
amounts Borrower owes Bank now or later, whether under this Agreement, the other
Loan Documents, or otherwise, including, without limitation, all obligations
relating to letters of credit (including reimbursement obligations for drawn and
undrawn letters of credit), cash management services, and foreign exchange
contracts, if any, and including interest accruing after Insolvency Proceedings
begin and debts, liabilities, or obligations of Borrower assigned to Bank, and
to perform Borrower’s duties under the Loan Documents.

“TFS Revenue” is the aggregate net revenue (gross revenue minus discounts and
returns) received by Borrower from (a) the sale of Borrower’s Sensor, Toggle,
and Foundry products, (b) any licensing of Borrower’s products, and (c) any
non-recurring engineering services revenue received by Borrower.  Evidence of
such net revenue shall be received and approved by Bank in Bank’s sole and
absolute discretion.

(b)        The following new defined terms are hereby inserted alphabetically in
Section 13.1 of the Loan Agreement:

“Beneficial Ownership Information Disclosure Form” means the form attached
hereto as Exhibit E.

“EBIDA” shall mean (a) Net Income, plus (b) Interest Expense, plus (c) to the
extent deducted in the calculation of Net Income, depreciation expense and
amortization expense.

“Extension Milestone” is the date on which Bank receives and approves evidence
satisfactory to Bank, in Bank’s sole and absolute discretion, on or before the
Conversion Date, that for the fiscal year ended December 31, 2018, (i) Borrower
has received gross revenue of at least Fifty-Four Million Eight Hundred
Ninety-Three Thousand Eight Hundred Dollars ($54,893,800), and (ii) Borrower has
achieved an EBIDA loss of no greater than Seven Million Three Hundred
Sixty-Seven Thousand Eighty-Eight Dollars ($7,367,088).

“First Amendment Effective Date” is July 6, 2018.

“Interest Expense” means for any fiscal period, interest expense (whether cash
or non-cash) determined in accordance with GAAP for the relevant period ending
on such date, including, in any event, interest expense with respect to any
Credit Extension and other Indebtedness of Borrower, including, without
limitation or duplication, all commissions, discounts, or related amortization
and other fees and charges with respect to letters of credit and bankers’
acceptance financing and the net costs associated with interest

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rate swap, cap, and similar arrangements, and the interest portion of any
deferred payment obligation (including leases of all types).

“Net Income” means, as calculated on a consolidated basis for Borrower and its
Subsidiaries for any period as at any date of determination, the net profit (or
loss), after provision for taxes, of Borrower and its Subsidiaries for such
period taken as a single accounting period.

“Prepayment Fee” shall be an additional fee, payable to Bank, with respect to
the Term Loan Advances, in an amount equal to (a) Two Hundred Forty Thousand
Dollars ($240,000) if the prepayment is made on or before the date that is
twelve (12) months after the First Amendment Effective Date, and (b) One Hundred
Twenty Thousand Dollars ($120,000) if the prepayment is made after the date that
is twelve (12) months after the First Amendment Effective Date and on or before
the Term Loan Maturity Date.

“Warrant” is that certain Warrant to Purchase Common Stock dated as of the First
Amendment Effective Date between Borrower and Bank, as amended, modified,
supplemented and/or restated from time to time.

(c)        The defined terms “Non Spin-Torque Product”,  “Spin-Torque
Milestone”, and “Spin-Torque Product”, set forth in Section 13.1 of the Loan
Agreement and all references thereto in the Loan Agreement are deleted in their
entirety.

2.8       Compliance Certificate.  From and after the date hereof, Exhibit B of
the Loan Agreement is replaced in its entirety with Exhibit B attached hereto
and all references in the Loan Agreement to the Compliance Certificate shall be
deemed to refer to Exhibit B attached hereto.

2.9       Exhibit E (Beneficial Ownership Information Disclosure Form).  The
Loan Agreement is hereby amended by adding the Beneficial Ownership Information
Disclosure Form attached hereto as Exhibit E as Exhibit E to the Loan Agreement.
From and after the date hereof, all references in the Loan Agreement to the
Beneficial Ownership Information Disclosure Form shall be deemed to refer to the
Beneficial Ownership Information Disclosure Form attached hereto as Exhibit  E.

3.         Original Warrant. Bank and Borrower hereby agree that, as of the date
hereof, that each of (i) Warrant to Purchase Stock issued by Borrower to Bank on
November 14, 2010, and (ii) Warrant to Purchase Stock issued by Borrower to Bank
on February 14, is hereby cancelled and will be returned to Borrower promptly
hereafter.

4.         Limitation of Amendments.

4.1       The amendments and waiver set forth in Sections 2 through 4, 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.

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4.2       This Amendment shall be construed in connection with and as part of
the Loan Documents and all terms, conditions, representations, warranties,
covenants and agreements set forth in the Loan Documents, except as herein
amended, are hereby ratified and confirmed and shall remain in full force and
effect.

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

5.1       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;

5.2       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;

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

5.4       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;

5.5       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;

5.6       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 Borrower, except as already has been obtained or made; and

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

6.         Integration.  This Amendment and the Loan Documents represent the
entire agreement about this subject matter and supersede prior negotiations or
agreements.  All prior

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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.

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

8.         Effectiveness.  This Amendment shall be deemed effective upon (a) the
due execution and delivery to Bank of this Amendment by each party hereto,
(b) the due execution and delivery to Bank of a Warrant to Purchase Common Stock
dated on or about the date hereof by each party thereto, and (c)Borrower’s
payment of Bank’s legal fees and expenses incurred in connection with this
Amendment.

[Signature page follows.]

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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.

 

BANK

    

BORROWER

 

 

 

 

 

SILICON VALLEY BANK

 

EVERSPIN TECHNOLOGIES, INC.

 

 

 

 

By:

/s/ Chris Goodwin

 

/s/ Jeff Winzeler

Name:

Chris Goodwin

 

Jeff Winzeler

Title

VP

 

Chief Financial Officer

 

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EXHIBIT B

COMPLIANCE CERTIFICATE

 

 

 

TO:

SILICON VALLEY BANK

Date:

 

 

 

 

 

FROM:

EVERSPIN TECHNOLOGIES, INC.

 

 

 

The undersigned authorized officer of EVERSPIN TECHNOLOGIES, INC., a Delaware
corporation, (“Borrower”) certifies that under the terms and conditions of the
Loan and Security Agreement between Borrower and Bank (the “Agreement”):

(1) Borrower is in complete compliance for the period ending _______________
with all required covenants except as noted below; (2) there are no Events of
Default; (3) all representations and warranties in the Agreement are true and
correct in all material respects on this date except as noted below; provided,
however, that such materiality qualifier shall not be applicable to any
representations and warranties that already are qualified or modified by
materiality in the text thereof; and provided, further that those
representations and warranties expressly referring to a specific date shall be
true, accurate and complete in all material respects as of such date;
(4) Borrower, and each of its Subsidiaries, has timely filed all required tax
returns and reports, and Borrower has timely paid all foreign, federal, state
and local taxes, assessments, deposits and contributions owed by Borrower except
as otherwise permitted pursuant to the terms of Section 5.8 of the Agreement;
and (5) no Liens have been levied or claims made against Borrower or any of its
Subsidiaries relating to unpaid employee payroll or benefits of which Borrower
has not previously provided written notification to Bank.

Attached are the required documents supporting the certification.  The
undersigned certifies that these are prepared in accordance with GAAP
consistently applied from one period to the next except as explained in an
accompanying letter or footnotes.  The undersigned 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.  Capitalized
terms used but not otherwise defined herein shall have the meanings given them
in the Agreement.

Please indicate compliance status by circling Yes/No under “Complies” column.

 

 

 

Reporting Covenants

Required

Complies

Monthly financial statements with Compliance Certificate

Monthly within 30 days

Yes    No

Annual financial statement (CPA Audited)

FYE within 150 days

Yes    No

Board Projections

Earlier of (i) 15 days after board approval or (ii) February 28th of each
calendar year

Yes    No

 

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10‑Q, 10‑K and 8-K

Within 5 days after filing with SEC

Yes    No

Board Projections

FYE within 30 days

Yes    No

 

Financial Covenant

Required

Actual

Complies

Maintain on a Monthly Basis:

 

 

 

Liquidity Ratio

See Schedule 1

____ to 1.00

Yes    No

 

 

 

 

TFS Revenue

See Schedule 1

$_____

Yes    No

 

The following financial covenant analysis and information set forth in Schedule
1 attached hereto are true and accurate as of the date of this Certificate.

Other Matters

 

 

 

Have there been any amendments of or other changes to the capitalization table
of Borrower and to the Operating Documents of Borrower or any of its
Subsidiaries?  If yes, provide copies of any such amendments or changes with
this Compliance Certificate.

Yes

No

 

The following are the exceptions with respect to the certification above:  (If
no exceptions exist, state “No exceptions to note.”)

 

 

 

 

 

 

 

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EVERSPIN TECHNOLOGIES, INC.

    

BANK USE ONLY

 

 

 

 

 

 

By:

 

 

Received by:

 

Name:

 

 

 

AUTHORIZED SIGNER

Title:

 

 

Date:

 

 

 

 

 

 

 

Verified:

 

 

 

 

AUTHORIZED SIGNER

 

 

 

 

 

 

Date:

 

 

 

 

 

 

 

Compliance Status:   Yes        No

 

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Schedule 1 to Compliance Certificate

Financial Covenants of Borrower

In the event of a conflict between this Schedule and the Loan Agreement, the
terms of the Loan Agreement shall govern.

Dated:  ____________________

I.          Liquidity Ratio (Section 6.7(a))

Required:         As of the last day of each month, a Liquidity Ratio of not
less than (i) 1.25:1.00 for each month prior to Borrower achieving the Extension
Milestone, and (ii) 1.50:1.00 for each month after Borrower achieves the
Extension Milestone.

Actual:

A.

Unrestricted cash and Cash Equivalents maintained at Bank

$________

B.

Net accounts receivable

$________

C.

Liquidity (line A, plus line B)

$________

D.

Outstanding Obligations

$________

E.

Liquidity Ratio (line C, divided by line D)

______

 

Is line E equal or greater than the required ratio?

________  No, not in compliance

________  Yes, in compliance

 

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II.         Performance to Plan (Section 6.7(b))

Required TFS Revenue of Borrower for such month (calculated on a cumulative
fiscal year to date basis):

Month Ending

Minimum TFS Revenue

April 30, 2018

$11,052,000

May 31, 2018

$14,485,000

June 30, 2018

$18,889,000

July 31, 2018

$20,933,000

August 31, 2018

$24,492,000

September 30, 2018

$29,069,000

October 31, 2018

$31,355,000

November 30, 2018

$35,355,000

December 31, 2018

$40,498,000

January 31, 2019

$2,493,000

February 28, 2019

$6,979,000

March 31, 2019

$12,459,000

April 30, 2019

$15,049,000

May 31, 2019

$19,724,000

June 30, 2019

$25,439,000

July 31, 2019

$28,399,000

August 31, 2019

$33,739,000

September 30, 2019

$40,264,000

October 31, 2019

$43,840,000

November 30, 2019

$50,277,000

December 31, 2019

$58,144,000

 

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Actual:

A.

Actual TFS Revenue of Borrower for such month (calculated on a cumulative year
to date basis):

$___________

 

Is line A equal to or greater than as required above?

No, not in compliance

Yes, in compliance

 

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EXHIBIT E

Beneficial Ownership Information Disclosure Form

1.   Does any individual,  directly or indirectly (for example, if applicable,
through such individual’s equity interests in the Borrower’s parent entity),
through any contract, arrangement, understanding, relationship or otherwise, own
25% or more of the equity interests of Borrower:

Yes      ☐         No       ☐

 

 

If yes, complete the following information:

 

 

Name

 

Date of

 

Residential

 

For US

 

For Non-US

 

Percentage

 

 

 

 

birth

 

address

 

Persons,

 

Persons: Type

 

of

 

 

 

 

 

 

 

 

Social

 

of ID, ID

 

ownership

 

 

 

 

 

 

 

 

Security

 

number,

 

(if indirect

 

 

 

 

 

 

 

 

Number:

 

country of

 

ownership,

 

 

 

 

 

 

 

 

(non-US

 

issuance,

 

explain

 

 

 

 

 

 

 

 

persons

 

expiration date

 

structure)

 

 

 

 

 

 

 

 

should

 

 

 

 

 

 

 

 

 

 

 

 

provide SSN

 

 

 

 

 

    

 

    

 

    

 

    

if available)

    

 

    

 

1

 

 

 

 

 

 

 

 

 

 

 

 

2

 

 

 

 

 

 

 

 

 

 

 

 

3

 

 

 

 

 

 

 

 

 

 

 

 

4

 

 

 

 

 

 

 

 

 

 

 

 

 

2.   Identify one individual with significant responsibility for managing
Borrower, i.e., an executive officer or senior manager (e.g., Chief Executive
Officer, President, Vice President, Chief Financial Officer, Treasurer, Chief
Operating Officer, Managing Member or General Partner) or any other individual
who regularly performs similar functions.  If appropriate, an individual listed
in Section 1 above may also be listed here.

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Name

    

Date of

    

Residential

    

For US Persons,

    

For Non-US

 

 

 

 

birth

 

address

 

Social Security

 

Persons: Type of

 

 

 

 

 

 

 

 

Number:

 

ID, ID number,

 

 

 

 

 

 

 

 

(non-US persons

 

country of

 

 

 

 

 

 

 

 

should provide SSN

 

issuance,

 

 

 

 

 

 

 

 

if available)

 

expiration date

 

 

 

 

 

 

 

 

 

 

 

 

The undersigned, in his or her individual capacity, hereby certifies, to the
best of his or her knowledge, that the information set out in this certificate
is true, complete and correct.

Date:

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Email:

 

 

Phone:

 

 

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