Amendment to Loan and Security Agreement



 Exhibit 10.14 
 FIFTH AMENDMENT TO 
 LOAN AND SECURITY AGREEMENT 

THIS FIFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this
14th day of June, 2011, by and between SILICON VALLEY
BANK, a California corporation (“Bank”) and IWATT INC., a Delaware corporation (“Borrower”). 

RECITALS 
 A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of November 25, 2008 (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 (i) modify the definition of Total
Liabilities and (ii) make certain other revisions to the Loan Agreement 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. The Loan Agreement is hereby amended as of the Effective Date as follows: 
 2.1 Section 13.1
(Definitions). The definition of Total Liabilities as set forth in Section 13.1 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following: 

“Total Liabilities” is on any day, obligations that should, under GAAP, be classified as liabilities on
Borrower’s consolidated balance sheet, including all Indebtedness, and current portion of Subordinated Debt permitted by Bank to be paid by Borrower, but excluding all (a) other Subordinated Debt and (b) non-cash liabilities for any
issued and outstanding warrants to purchase Borrower’s stock, that have, in accordance with GAAP, been classified and accounted for as liabilities on the Borrower’s balance sheet under GAAP. 







 3. 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. 

4. Limitation of Amendments. 
 4.1 The amendments set forth in Sections 2 and 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.

 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; 

  
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 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. 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. Prior Agreement. The Loan
Documents are hereby ratified and reaffirmed and shall remain in full force and effect. 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. 
 8. 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) Borrower’s payment of Bank’s legal fees and expenses in connection with the negotiation and preparation of 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
	
	SILICON VALLEY BANK
		
	By:	 	 /s/ Carley Brandt

		 	Name:	 	Carley Brandt
		 	Title:	 	Relationship Manager
	
	BORROWER
	
	IWATT INC.
		
	By:	 	 /s/ RONALD EDGERTON

		 	Name:	 	RONALD EDGERTON
		 	Title:	 	PRESIDENT & CEO
		
	By:	 	 /s/ JAMES V McCANNA

		 	Name	 	JAMES V McCANNA
		 	Title:	 	VP & CFO

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







 EXHIBIT B 

COMPLIANCE CERTIFICATE 
 COMPLIANCE CERTIFICATE 
  

									
	TO:	 	SILICON VALLEY BANK	 		  	Date:                     
	FROM:	 	 IWATT INC.
	 		  	

 The undersigned authorized officer of iWatt, Inc. (“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 5.9 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 Covenant
	  	 Required
	  	 Complies

			
	Monthly financial statements with Compliance Certificate	  	Monthly within 30 days	  	Yes    No
			
	Annual financial statement (CPA Audited) + CC (Waiver)	  	FYE within 180 days	  	Yes    No
			
	10-0,10-K and 8-K (if applicable)	  	Within 5 days after filing with SEC	  	Yes    No
			
	Financial Projections	  	Annually within 30 days after start of Fiscal Year	  	Yes    No
			
	A/R & A/P Agings, Reconciliations, Deferred Revenue Report	  	Monthly within 30 days	  	Yes    No
			
	Transaction Report	  	Bi-Weekly and with each Advance, or Monthly within 30 days while on Streamline	  	Yes    No

 The following Intellectual Property was registered (or a registration application submitted) after the Effective Date (if
no registrations, state “None”) 
  
  

 
  

  
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	 Financial Covenant
	  	 Required
	  	 Actual
	 	  	 Complies

				
	 Maintain on a Monthly Basis:
	  		  				  	
				
	 Minimum Tangible Net Worth
	  	 $1,000,000 plus (i) 50% of new equity or sub debt plus (ii) 50% of quarterly Net Income (beginning 6/30/10)
	  	$
	            
	  
	  	 Yes    No


 The following financial covenant analyses 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.”) 
  

 
  

 
  

 

 



			
	IWATT INC.
		 	
		 	
	By:	 	  

	Name:	 	
	Title:	 	

 


			
	BANK USE ONLY
		
	Received by:	 	  

		 	AUTHORIZED SIGNER


			
	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.	Minimum Tangible Net Worth (Section 6.9) 

  

			
	Required:	  	$ 1,000,000 plus (i) 50% of new equity or sub debt plus (ii) 50% of quarterly Net Income (beginning 6/30/10)
		
	Actual:	  	$         

  

							
	A.	  	Aggregate value of total assets of Borrower and its Subsidiaries	  	$	            	  
			
	B.	  	Aggregate value of goodwill of Borrower and its Subsidiaries	  	$	            	  
			
	C.	  	Aggregate value of intangible assets of Borrower and its Subsidiaries	  	$	            	  
			
	D.	  	Aggregate value of notes, accounts receivable of Borrower and its Subsidiaries and other obligations owing to Borrower from its officers or other affiliates	  	$	            	  
			
	E.	  	Aggregate value of any reserves not only deducted from assets	  	$	            	  
			
	F.	  	Aggregate value of all obligations that should, under GAAP, be classified as liabilities on Borrower’s consolidated balance sheet, including all Indebtedness, and current
portion of Subordinated Debt permitted by Bank to be paid by Borrower, but excluding all (a) other Subordinated Debt and (b) non-cash liabilities for any issued and outstanding warrants to purchase Borrower’s stock, that have, in accordance
with GAAP, been classified and accounted for as liabilities on the Borrower’s balance sheet under GAAP	  	$	            	  
			
	G.	  	Aggregate value of Indebtedness of Borrower subordinated to Borrower’s Indebtedness to Bank	  	$	            	  
			
	H.	  	Tangible Net Worth (Line A, minus Line B, minus Line C, minus Line D, minus Line E, minus Line F, plus Line G)	  	$	            	  
			
	I.	  	50% of quarterly Net Income (beginning quarter ended June 30, 2010), without reduction for any losses	  	$	            	  
			
	J.	  	50% of proceeds from the issuance of equity after the Effective Date	  	$	            	  
			
	K.	  	50% of subordinated debt proceeds received by Borrower after Effective Date	  	$	            	  
			
	L.	  	Minimum Tangible Net Worth ($1,000,000), plus Line I, plus Line J, plus Line K	  	$	            	  

 Is Line H greater than Line L? 
  

									
	         	 	No, not in compliance	 		 	         	  	Yes, in compliance


  
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