Exhibit 10.27

FIRST AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS FIRST AMENDMENT to Loan and Security Agreement (this “Amendment”) is
entered into as of February 18, 2014, by and between OXFORD FINANCE LLC, a
Delaware limited liability company with an office located at 133 North Fairfax
Street, Alexandria, Virginia 22314 (“Oxford”), as collateral agent (in such
capacity, “Collateral Agent”), the Lenders listed on Schedule 1.1 of the Loan
Agreement (as defined below) or otherwise party thereto from time to time (each
a “Lender” and collectively, the “Lenders”) including Oxford in its capacity as
a Lender and SILICON VALLEY BANK, a California corporation with an office
located at 3003 Tasman Drive, Santa Clara, CA 95054 and NANOSPHERE, INC., a
Delaware corporation with offices located at 4088 Commercial Avenue, Northbrook,
IL 60062 (“Borrower”).

RECITALS

A. Collateral Agent, Lenders and Borrower have entered into that certain Loan
and Security Agreement dated as of May 6, 2013 (as amended, restated,
supplemented or otherwise modified from time to time, the “Loan Agreement”).

B. Lenders have extended credit to Borrower for the purposes permitted in the
Loan Agreement.

C. Borrower has requested that Collateral Agent and Lenders (i) extend a draw
period and (ii) make certain other revisions to the Loan Agreement as more fully
set forth herein.

D. Collateral Agent and Lenders have agreed to modify such consent and 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 2.2 (Term Loans). Section 2.2(a)(ii) of the Loan Agreement hereby is
amended and restated as follows:

“(ii) Subject to the terms and conditions of this Agreement, the Lenders agree,
severally and not jointly, during the Second Draw Period, to make term loans to
Borrower in an aggregate amount of Ten Million Dollars ($10,000,000.00)
according to each Lender’s Term B Loan Commitment as set forth on Schedule 1.1
hereto (such term loans are hereinafter referred to singly as a “Term B Loan”,
and collectively as the “Term B Loans”; each Term A Loan or Term B Loan is
hereinafter referred to singly as a “Term Loan” and the Term A Loans and the
Term B Loans are hereinafter referred to collectively as the “Term Loans”);
provided that on and as of the Funding Date of such Term B Loans Borrower has
achieved the Revenue Event. After repayment, no Term B Loan may be re-borrowed.”

2.2 Section 2.2 (Term Loans). A new paragraph hereby is added to Section 2.2(b)
of the Loan Agreement as follows:

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“Notwithstanding the foregoing, if the Amortization Date is extended beyond
June 1, 2014, pursuant to the terms of this Agreement (based on a Funding Date
of the Term B Loans after June 1, 2014), then (i) the amount outstanding under
the Term A Loans on the Funding Date of the Term B Loans shall be interest only
beginning on the Funding Date of the Term B Loans through such extended
Amortization Date; and (ii) the aggregate amount outstanding under the Term
Loans on such extended Amortization Date shall amortize on such extended
Amortization Date based upon a repayment schedule equal to thirty six
(36) months.”

2.3 Section 6.10 of the Loan Agreement hereby is amended and restated as
follows:

“Section 6.10 Financial Covenant. On and after the Funding Date of the Term B
Loans, Borrower shall maintain at all times, measured monthly, the Liquidity
Reserve in an amount equal to or greater than the Adjusted Average Monthly Cash
Burn Amount at any time. Borrower shall certify its compliance with this
Section 6.10 in a writing signed by a Responsible Officer on the Funding Date
and on each Compliance Certificate from and after the Funding Date of the Term B
Loans.”

2.4 The following definitions hereby are added to or amended and restated in
Section 13.1 of the Loan Agreement as follows:

“Adjusted Average Monthly Cash Burn Amount” means, as of any date, the amount
that is equal to six (6) times Borrower’s Average Monthly Cash Burn Amount as of
such date.

“Amortization Date” is, (i) with respect to the Term A Loans, June 1, 2014;
provided that upon the draw of the Term B Loans, “Amortization Date” with
respect to the Term A Loans shall be the thirteenth (13th) Payment Date
following the Funding Date of the Term B Loans; and (ii) with respect to the
Term B Loans, the thirteenth (13th) Payment Date following the Funding Date of
the Term B Loans.

“Average Monthly Cash Burn Amount” means, with respect to Borrower on a three
(3) month rolling basis, an amount equal to one-third (1/3) of the aggregate
amount of the Borrower’s net income and/or net loss during such three (3) month
period, in each case excluding (i) depreciation, (ii) amortization and
(iii) non-cash interest expense; provided, however, that if Borrower has
aggregate net income over such three (3) month period, then the Average Monthly
Cash Burn Amount shall be zero.

“Final Payment Percentage” shall be two percent (2%); provided that upon the
draw of the Term B Loans, the “Final Payment Percentage” shall be four percent
(4%).

“Liquidity Reserve” means, as of any date, after giving effect to Borrower’s
receipt of the proceeds of the Term B Loans on the Funding Date, the sum of
(a) Borrower’s unrestricted cash and cash equivalents (including, without
limitation, the proceeds of the Term B Loans) that are subject to a first
priority perfected lien in favor of the Collateral Agent, for the benefit of
itself and the Lenders, subject only to Permitted Liens that are permitted by
the terms of this Agreement to have priority over Collateral Agent’s Lien, plus
(b) the aggregate amount of the then outstanding maximum commitments of
investors to acquire shares of capital stock of the Borrower as of such date
pursuant to any binding equity commitments of investors to acquire shares of the
capital stock of the Company, in form and substance reasonably satisfactory to
Collateral Agent and Lenders, provided that the share price of the Borrower’s
common stock is at least $1.25 per share as of the close of trading on the
NASDAQ Global Market on such date (or if the NASDAQ Global Market is not open
for trading on such date, then the immediately preceding date on which the stock
exchange was open for trading).

“Revenue Event” means Borrower’s receipt of revenue of at least Thirteen Million
Eight Hundred Thousand Dollars ($13,800,000.00) on a trailing twelve (12) month
basis.

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“Second Draw Period End Date” means September 30, 2014.

2.5 The following definition hereby is deleted from Section 13.1 of the Loan
Agreement:

“Interest Only Extension”.

2.6 Exhibit C of the Loan Agreement hereby is replaced by Exhibit C attached
hereto.

3. Limitation of Amendment.

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 Collateral Agent or any Lender 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 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 Collateral Agent and Lenders to
enter into this Amendment, Borrower hereby represents and warrants to Collateral
Agent and Lenders 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 in all material respects 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 Collateral Agent and
Lenders on the Effective Date, or subsequent thereto, 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
Borrower, except as already has been obtained or made; and

4.7 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.

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4.8 The resolutions that were duly and validly adopted by Borrower’s Board of
Directors pursuant to that certain Corporate Borrowing Certificate dated as of
the Effective Date remain in full force and effect as of the date hereof and
have not been in any way modified, repealed, rescinded, amended or revoked, and
Collateral Agent and Lenders may rely on them until Collateral Agent and each
Lender receives written notice of revocation from Borrower.

5. 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.

6. Effectiveness. This Amendment shall be deemed effective upon the due
execution and delivery to Collateral Agent and Lenders of (i) this Amendment by
each party hereto and (ii) Borrower’s payment of all Lenders’ Expenses incurred
through the date of this Amendment.

[Balance of Page Intentionally Left Blank]

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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:

NANOSPHERE, INC.

By:

 

/s/ Roger Moody

Name: Roger Moody

Title: Chief Financial Officer

COLLATERAL AGENT AND LENDER:

OXFORD FINANCE LLC

By

 

/s/ Timothy A. Lex

Name: Timothy A. Lex

Title: Chief Operating Officer

LENDER:

SILICON VALLEY BANK

By

 

/s/ Nicholas Honigman

Name: Nicholas Honigman

Title: Vice President

[Signature Page to First Amendment to Loan and Security Agreement]

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EXHIBIT C

Compliance Certificate

 

TO:   

OXFORD FINANCE LLC, as Collateral Agent and Lender

SILICON VALLEY BANK, as Lender

FROM:    NANOSPHERE, INC.

The undersigned authorized officer (“Officer”) of NANOSPHERE, INC. (“Borrower”),
hereby certifies in his sole capacity as Officer, and not in any individual
capacity, that in accordance with the terms and conditions of the Loan and
Security Agreement by and among Borrower, Collateral Agent, and the Lenders from
time to time party thereto (the “Loan Agreement;” capitalized terms used but not
otherwise defined herein shall have the meanings given them in the Loan
Agreement),

(a) Borrower is in complete compliance for the period ending
                     with all required covenants except as noted below;

(b) There are no Events of Default, except as noted below;

(c) Except as noted below, all representations and warranties of Borrower stated
in the Loan Documents are true and correct in all material respects on this date
and for the period described in (a), above; 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.

(d) Borrower, and each of Borrower’s Subsidiaries, has timely filed all required
tax returns and reports, Borrower, and each of Borrower’s Subsidiaries, has
timely paid all foreign, federal, state, and local taxes, assessments, deposits
and contributions owed by Borrower, or Subsidiary, except as otherwise permitted
pursuant to the terms of Section 5.8 of the Loan Agreement;

(e) 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 Collateral Agent and the
Lenders.

Attached are the required documents, if any, supporting our certification(s).
The Officer, on behalf of Borrower, in his sole capacity as Officer, and not in
any individual capacity, further certifies that the attached financial
statements are prepared in accordance with Generally Accepted Accounting
Principles (GAAP) and are consistently applied from one period to the next
except as explained in an accompanying letter or footnotes and except, in the
case of unaudited financial statements, for the absence of footnotes and subject
to year-end audit adjustments as to the interim financial statements.

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Please indicate compliance status since the last Compliance Certificate by
circling Yes, No, or N/A under “Complies” column.

 

    

Reporting Covenant

  

Requirement

  

Actual

  

Complies

1)    Consolidated and consolidating balance sheet, income statement and cash
flow statement    Monthly within 30 days       Yes    No    N/A 2)    Annual
(CPA Audited) statements    Within 120 days after FYE or within 5 days of filing
with the SEC       Yes    No    N/A 3)    Annual Financial Projections/Budget
(prepared on a monthly basis)    Annually (within 10 days of FYE), and when
revised       Yes    No    N/A 4)    A/R & A/P agings    If applicable       Yes
   No    N/A 5)    8-K, 10-K and 10-Q Filings    If applicable, within 5 days of
filing       Yes    No    N/A 6)    Compliance Certificate    Monthly within 30
days       Yes    No    N/A 7)    IP Report    When required       Yes    No   
N/A 8)    Total amount of Borrower’s cash and cash equivalents at the last day
of the measurement period       $________    Yes    No    N/A 9)    Total amount
of Borrower’s Subsidiaries’ cash and cash equivalents at the last day of the
measurement period       $________    Yes    No    N/A

Financial Covenants (on and after Term B Loan Funding)

 

     Covenant    Requirement    Actual    Complies 1)    Liquidity Reserve    At
least the Adjusted Average         Yes    No       Monthly Cash Burn Amount   
     

Deposit and Securities Accounts

(Please list all accounts; attach separate sheet if additional space needed)

 

Institution Name    Account Number    New    Account?    Account Control
Agreement in place? 1)          Yes    No    Yes    No 2)          Yes    No   
Yes    No 3)          Yes    No    Yes    No 4)          Yes    No    Yes    No

Other Matters

 

1)    Have there been any changes in management since the last Compliance
Certificate?    Yes    No 2)    Have there been any
transfers/sales/disposals/retirement of Collateral or IP prohibited by the Loan
Agreement?    Yes    No 3)    Have there been any new or pending claims or
causes of action against Borrower that involve more than Two Hundred Fifty
Thousand Dollars ($250,000.00)?    Yes    No 4)    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

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Exceptions

Please explain any exceptions with respect to the certification above: (If no
exceptions exist, state “No exceptions.” Attach separate sheet if additional
space needed.)

 

NANOSPHERE, INC. By:     Name:     Title:    

Date:

 

LENDER USE ONLY Received by:       Date:                      Verified by:      
Date:                      Compliance Status:       Yes       No