Exhibit 10.4

 

DEFAULT WAIVER AND FIRST AMENDMENT
TO
LOAN AND SECURITY AGREEMENT

 

This Default Waiver and First Amendment to Loan and Security Agreement (this
“Amendment”) is entered into as of March 14, 2013, by and between Silicon Valley
Bank (“Bank”) and Millennial Media, Inc., a Delaware corporation (“Borrower”)
whose address is 2400 Boston Street, Suite 301, Baltimore, MD 21224.

 

RECITALS

 

A.                                    Bank and Borrower have entered into that
certain Loan and Security Agreement dated as of August 11, 2011 (as the same may
from time to time be amended, modified, supplemented or restated, the “Loan
Agreement”).  Bank has extended credit to Borrower for the purposes permitted in
the Loan Agreement.

 

B.                                    Borrower has identified certain facts to
Bank that may raise issues under the Loan Agreement (1) related to the covenant
set forth in Section 6.11 of the Loan Agreement as a result of Borrower’s
formation of Subsidiaries in Singapore (Millennial Media Private
Limited), Indonesia (Millennial Media Private Limited RO), Germany (Millennial
Media GmbH), France (Millennial Media SAS) and Japan (Millennial Media K.K.)
(collectively, the “New Subsidiaries”),  and Borrower’s ownership interest in
such Subsidiaries to Bank, and (2) the covenant set forth in Section 7.7 of the
Loan Agreement regarding Investments by Borrower in the New Subsidiaries prior
to the date hereof (collectively, the “Existing Events”).

 

C.                                    Borrower has requested that, if and to the
extent applicable, Bank waive its rights and remedies against Borrower, limited
specifically to the Existing Events.  Although Bank is under no obligation to do
so, Bank is willing to not exercise its rights and remedies, if any, against
Borrower related to the specific Existing Events on the terms and conditions set
forth in this Amendment, so long as Borrower complies with the terms, covenants
and conditions set forth in this Amendment.

 

D.                                    Borrower and Bank have further agreed to
amend the Loan Agreement to (1) allow Investments in the New Subsidiaries, and
(2) making certain other revisions as more fully set forth herein.  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.

 

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2.                                      Waiver .

 

Bank hereby waives its rights and remedies with respect to a default related to
Existing Events under the Loan Agreement, if and to the extent there has been a
default.  Bank’s waiver of Borrower’s compliance of these covenants shall apply
only to the foregoing periods up to the date of this Amendment.  Accordingly,
hereinafter, Borrower shall be in compliance with these covenants.

 

Bank’s agreement to waive its rights and remedies in connection with the
above-described Existing Events (1) in no way shall be deemed an agreement by
the Bank to waive Borrower’s compliance with the above-described covenants as of
all other dates and (2) shall not limit or impair the Bank’s right to demand
strict performance of these covenants as of all other dates and (3) shall not
limit or impair the Bank’s right to demand strict performance of all other
covenants as of any date.

 

3.                                      Amendments to Loan Agreement.

 

3.1                               Section 6.11 (Formation or Acquisition of
Subsidiaries).  The second sentence of Section 6.11 is amended in its entirety
and replaced with the following:

 

For each Foreign Subsidiary of Borrower or any Guarantor (other than Foreign
Subsidiaries for which Borrower has already provided Bank with a stock pledge),
Borrower or such Guarantor shall (x) (a) if such Foreign Subsidiary has assets
in excess of $4,000,000, or (b) upon the request of Bank if such Foreign
Subsidiary’s assets do not exceed $4,000,000, provide to Bank appropriate
certificates and powers and financing statements, pledging all of the direct or
beneficial ownership interest in such Foreign Subsidiary (provided that in no
event shall more than 65% of the total outstanding voting capital stock of any
such Foreign Subsidiary be required to be pledged), in form and substance
satisfactory to Bank, and (y) provide to Bank all other documentation in form
and substance satisfactory to Bank, which in its opinion is appropriate with
respect to the execution and delivery of the applicable documentation referred
to in clause (x) above.

 

3.2                               Section 13.1 (Definitions).  Clause (f) of the
defined term “Permitted Investments” in Section 13.1 of the Loan Agreement is
amended in its entirety and replaced with the following:

 

(f)                                   Investments (i) by Borrower in its Foreign
Subsidiaries for reasonable operating expenses incurred in the ordinary course
of business not to exceed One Million Dollars ($1,000,000) in the aggregate in
any fiscal quarter and (ii) by Subsidiaries in other Subsidiaries or in
Borrower;

 

4.                                      Limitation of Amendment.

 

4.1                               The amendments set forth in Section 3, 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 other than the Existing Events 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 most
recently delivered to Bank 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 by all
necessary action on the part of Borrower;

 

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 either 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.                                      Prior Agreement.  Except as expressly
provided for in this Amendment, the Loan Documents are hereby ratified and
reaffirmed and shall remain in full force and effect.

 

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This Amendment is not a novation and the terms and conditions of this Amendment
shall be in addition to and supplemental to all terms and conditions set forth
in the Loan Documents.  In the event of any conflict or inconsistency between
this Amendment and the terms of such documents, the terms of this Amendment
shall be controlling, but such document shall not otherwise be affected or the
rights therein impaired.

 

7.                                      Release by Borrower.

 

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

 

7.2                               In furtherance of this release, Borrower
expressly acknowledges and waives any and all rights under any and all
ordinances and statutory or judicially created laws or rules of any jurisdiction
which have a similar effect as California Civil Code Section 1542 which provides
as follows:

 

“A general release does not extend to claims which the creditor does not know or
expect to exist in his favor at the time of executing the release, which if
known by him must have materially affected his settlement with the debtor.”
(Emphasis added.)

 

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

 

7.4                               This release may be pleaded as a full and
complete defense and/or as a cross-complaint or counterclaim against any action,
suit, or other proceeding that may be instituted, prosecuted or attempted in
breach of this release.  Borrower acknowledges that the

 

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release contained herein constitutes a material inducement to Bank to enter into
this Amendment, and that Bank would not have done so but for Bank’s expectation
that such release is valid and enforceable in all events.

 

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

 

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

 

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

 

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

 

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

 

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

 

8.                                      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.

 

9.                                      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.

 

10.                               Effectiveness.  This Amendment shall be deemed
effective upon (a) the due execution and delivery to Bank of this Amendment by
each party hereto, and (b) payment of Bank’s legal fees and expenses in
connection with the negotiation and preparation of this Amendment.

 

11.                               Governing Law.  This Amendment and the rights
and obligations of the parties hereto shall be governed by and construed in
accordance with the laws of the Commonwealth of Virginia.

 

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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

Millennial Media, Inc.

 

 

 

 

By:

/s/ Anthony Raley

 

By:

/s/ Michael B. Avon

Name:

Anthony Raley

 

Name:

Michael B. Avon

Title:

VP

 

Title:

EVP and CFO

 

[Signature Page to Default Waiver]

 

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