S-1/A

As filed with the U.S. Securities and Exchange Commission on August 10, 2015.

Registration No. 333-202186

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 7

to

Form S-1

REGISTRATION STATEMENT

Under

The Securities Act of 1933

eASIC Corporation

(Exact name of Registrant as specified in its charter)

Delaware	3674	77-0532688
(State or other jurisdiction of incorporation or organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification Number)

eASIC Corporation

2585 Augustine Drive, Suite 100

Santa Clara, California 95054

(408) 855-9200

(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

Ronnie Vasishta

President and Chief Executive Officer

eASIC Corporation

2585 Augustine Drive, Suite 100

Santa Clara, California 95054

(408) 855-9200

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

James F. Fulton, Jr. David G. Peinsipp Robert W. Phillips Cooley LLP 3175 Hanover Street Palo Alto, California 94304 (650) 843-5000 Richard J. Deranleau Senior Vice President, Finance and Chief Financial Officer eASIC Corporation 2585 Augustine Drive, Suite 100 Santa Clara, California 95054 (408) 855-9200 Jorge del Calvo Davina K. Kaile Alan B. Kalin Pillsbury Winthrop Shaw Pittman LLP 2550 Hanover Street Palo Alto, California 94304 (650) 233-4500

Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box:  ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer   ¨ Accelerated filer   ¨

Non-accelerated filer   x    (Do not check if a smaller reporting company) Smaller reporting company   ¨

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we and the selling stockholders are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted.

PROSPECTUS

(Subject to Completion)

Issued August 10, 2015

            Shares

COMMON STOCK

eASIC Corporation is offering             shares of common stock and the selling stockholders are offering                  shares. We will not receive any of the proceeds from the sale of the shares being offered by the selling stockholders. This is our initial public offering and no public market currently exists for our shares. We anticipate that the initial public offering price will be between $         and $         per share.

We have applied to have our common stock listed on the NASDAQ Global Market under the symbol “EASI.”

We are an “emerging growth company” as defined under the federal securities laws and are subject to reduced public company reporting requirements. Investing in our common stock involves risks. See “Risk Factors” beginning on page 12.

PRICE $             A SHARE

	Price to Public		Underwriting Discounts and Commissions(1)		Proceeds to eASIC		Proceeds to the selling stockholders
Per share		$		$		$		$
Total		$		$		$		$

(1) See “Underwriting” for a description of the compensation payable to the underwriters.

The underwriters have the right to purchase up to an additional             shares of common stock from us to cover over-allotments.

The Securities and Exchange Commission and state securities regulators have not approved or disapproved of these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The underwriters expect to deliver the shares of common stock to purchasers on                     , 2015.

MORGAN STANLEY	DEUTSCHE BANK SECURITIES
RAYMOND JAMES	BAIRD	WILLIAM BLAIR

ROTH CAPITAL PARTNERS NORTHLAND CAPITAL MARKETS

                    , 2015

Global Megatrends are driving the need for custom hardware
Global Networks
Mobility
Cloud
101100110101011
Big Data

Think Custom IC
Think eASIC®
Custom ICs are essential to differentiate hardware in the marketplace
Wireless
Storage
Wired
eASIC®
nextremeTM
eASIC provides breakthrough solutions for delivering Custom ICs
Time-to-Market
Performance
Power
Cost

TABLE OF CONTENTS

	Page
Prospectus Summary		1
The Offering		6
Risk Factors		12
Special Note Regarding Forward-Looking Statements		40
Industry and Market Data		42
Glossary		43
Use of Proceeds		44
Dividend Policy		46
Capitalization		47
Dilution		49
Selected Consolidated Financial Data		52
Management’s Discussion and Analysis of Financial Condition and Results of Operations		54
Business		91

	Page
Management		106
Executive and Director Compensation		113
Certain Relationships and Related Party Transactions		128
Principal and Selling Stockholders		133
Description of Capital Stock		137
Shares Eligible for Future Sale		142
Material U.S. Federal Income and Estate Tax Consequences to Non-U.S. Holders of Our Common Stock		144
Underwriting		147
Legal Matters		154
Experts		154
Where You Can Find Additional Information		154
Index to Consolidated Financial Statements		F-1

None of us, the selling stockholders or the underwriters have authorized anyone to provide any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We, the selling stockholders and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We and the selling stockholders are offering to sell, and seeking offers to buy, shares of our common stock only in jurisdictions where offers and sales are permitted. The information in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of shares of our common stock. Our business, financial condition, results of operations, and prospects may have and are likely to have changed since that date.

Through and including                     , 2015 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This delivery requirement is in addition to the obligation of dealers to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

For investors outside the United States: None of us, the selling stockholders or the underwriters have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the shares of our common stock and the distribution of this prospectus outside of the United States.

PROSPECTUS SUMMARY

This summary highlights information contained elsewhere in this prospectus. This summary is not complete and does not contain all of the information you should consider in making your investment decision. You should read the following summary together with the more detailed information appearing elsewhere in this prospectus, including “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and our consolidated financial statements and related notes before deciding whether to purchase shares of our common stock. Unless the context otherwise requires, the terms “eASIC,” “the Company,” “we,” “us,” and “our” in this prospectus refer to eASIC Corporation.

eASIC CORPORATION

Overview

We have pioneered a differentiated solution that enables us to rapidly and cost-effectively deliver custom integrated circuits (ICs), creating value for our customers’ hardware and software systems. Our eASIC solution consists of our eASIC platform which incorporates a versatile, pre-defined and reusable base array and customizable single-mask layer, our ASICs, delivered using either our easicopy or standard ASIC methodologies, and our proprietary design tools. Customers can efficiently migrate to our easicopy ASIC from the eASIC platform using our easicopy methodology. We believe our eASIC solution provides the optimal combination of fast time-to-market, high performance, low power consumption, low development cost and low unit cost for our customers. Our solution has broad applicability across a wide range of customers, applications and end markets including communications infrastructure, storage and data processing and industrial applications. Our solution should position us to address additional end markets in the future. As of March 31, 2015, we have leveraged our eASIC platform to develop four generations of eASIC products with increasingly smaller process nodes, and we have designed over 200 custom ICs and shipped over 21 million units.

We believe the need for differentiation through custom ICs is driven by several megatrends, including the proliferation of mobile devices driving the deployment of high capacity and high bandwidth wireless infrastructure, the rapid transition to cloud computing and the emergence of big data analytics. We believe the ability to differentiate hardware and software systems through custom ICs is critical to helping our customers grow faster than their competitors and enhance their profit margins. Historical solutions for customized ICs have included Application Specific Integrated Circuits (ASICs), Application Specific Standard Products (ASSPs) and Field Programmable Gate Arrays (FPGAs). We believe our products avoid the painful tradeoffs associated with these historical solutions. For example, based on data provided by a majority of our customers for power consumption with respect to those customers’ designs using FPGAs, as well as our own internal analysis using the latest generation of custom ICs based on our eASIC platform, we believe that we can enable our customers to reduce power consumption by 50% to 80% compared to FPGAs at the same process node. In addition, in all five cases where customers have required that our design provide an increase in performance, as measured by clock speed of the chip, we have been able to improve performance by 60% to 120% compared to FPGAs at the same process node. With our eASIC platform, we believe our customers can significantly reduce non-recurring engineering (NRE) charges and lower design and manufacturing time by nine to 12 months or more when compared to traditional ASIC design and manufacturing processes. We believe our competitive advantages will increase over time as the costs and complexity associated with the development and manufacturing of future generations of ICs continue to rise.

We estimate that our addressable market opportunity across ASIC, ASSP and FPGA applications is approximately $78 billion, based on data from Gartner Research (Gartner). During the year ended December 31, 2014 and the three months ended March 31, 2015, we sold our products and services to over 14 customers and 10 customers, respectively, including Ericsson, Fujitsu, Huawei, NEC, Omnivision, Seagate and Toshiba. The number of customers varies between different periods due to timing of orders from customers. In 2012, 2013,

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2014 and the first three months of 2015, Ericsson and Seagate together accounted for 73%, 87%, 93% and 95%, respectively, of our total revenues. For the years ended December 31, 2013 and 2014, our total revenues were $29.8 million and $67.4 million, respectively, representing an annual growth rate of 126%. We do not expect our revenues to continue to grow at these historical rates in the future. Our net loss for 2013 and 2014 was $7.8 million and $1.1 million, respectively. For the three months ended March 31, 2014 and 2015, our revenues were $13.6 million and $20.1 million, respectively, and our net income was $0.4 million and $0.7 million, respectively. We may not be able to grow or sustain our revenues in the future and expect our expenses to increase substantially in the near term. We design our ICs and use third-party vendors for substantially all of our manufacturing production and operations.

Industry Background

Key technology megatrends driving massive growth in the demand for network bandwidth, computing resources and data storage

The significant and growing demands on networking, compute and storage infrastructure have resulted in service providers, enterprises and datacenter operators requiring OEMs to rapidly introduce next generation networking, server and storage systems which deliver high return on investment with enhanced functionality and performance, while reducing power consumption and physical footprint.

Challenges with historical IC solutions for OEMs

In order to provide semiconductor-based differentiation and customization for their product offerings, OEMs have traditionally had to choose between ASICs, ASSPs and FPGAs. However, these solutions require increasingly painful tradeoffs among time-to-market, performance, power consumption, unit and development costs. As the costs and time required to develop ASICs and ASSPs have increased, we believe that OEMs have become increasingly receptive to finding a better solution to provide the custom ICs they desire. While FPGAs offer a time-to-market advantage, they consume significant amounts of power and are cost prohibitive to high-volume production.

Our Solution

We invented a way to customize ICs with a single mask layer base array that we believe better avoids the painful tradeoffs associated with traditional ASICs, ASSPs and FPGAs. Our eASIC platform utilizes a versatile, pre-defined and reusable base array, which is built using standard mask layers. One custom mask layer is then inserted into the base array, which customizes the IC to meet a specific customer’s requirements. The ability to customize an IC with a single mask layer is achieved using our proprietary architecture and design tools. Once the IC design is completed, the custom mask layer is fabricated and added to the pre-manufactured base array to complete the manufacturing process. Our easicopy ASICs are customized using a full set of masks and are developed using our easicopy methodology. The final packaged and tested IC is then shipped to the customer for implementation into their specific application. We believe this approach provides the optimal combination of benefits including fast time-to-market, high performance, low power consumption, low unit cost and low development cost for our customers.

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Benefits to Our Customers

Our customers are continuously developing new products in existing and new application areas as they look to differentiate themselves from their competitors, reduce time-to-market, increase market share and enhance margins. In our view, the key benefits of our solutions, as outlined below, help our customers to achieve their goals:

• Product Differentiation Through Custom ICs. Our custom ICs are designed to meet the specific technical requirements of our customers in their respective end-markets while balancing their time-to-market, performance, power consumption and overall cost needs.

• Fast Time-to-Market. Our eASIC platform offers a time-to-market advantage of up to 12 months or more over traditional ASICs.

• High Performance. Our eASIC platform is designed to meet the high performance requirements that our customers need. We believe that our solution has ASIC-comparable performance that is superior to that offered by FPGAs.

• Low Power Consumption. In most of our end markets, power consumption is a key consideration in system design and operation. Our solution is power-efficient and can considerably lower a system’s overall operating cost and power consumption.

• Low Development Cost. The versatility of our pre-designed base array and the need to customize only one mask layer in our eASIC platform allows us to lower development cost by significantly reducing design and NRE expenses.

• Low Unit Cost. We are able to design and deliver ICs that have a smaller die size when compared with FPGAs. Due to the area efficient die and lower cost IC packaging, our solution offers an attractive cost per unit relative to FPGAs.

Our Growth Strategy

Our objective is to be the leading provider of custom and affordable ICs with fast time-to-market. We believe our solution enables our customers to differentiate their products, become more competitive in their markets and enhance their growth rates, market share and profit margins. Key elements of our strategy include:

• Exploit the Multiple Benefits of our eASIC Platform. We intend to leverage the multiple benefits of our versatile eASIC platform to expand our customer base across a variety of end products.

• Expand Market Share within Our Existing Customers. We intend to increase our market share by applying our differentiated design capabilities to new design programs and by continuing to foster deep customer relationships. We believe this will position us to expand into our customers’ adjacent and next generation products.

• Sell into New Customers in Existing Markets. We have successfully demonstrated a number of key benefits to top customers within certain applications and markets, such as wireless communications infrastructure and storage. We plan to work with other top OEMs in our existing markets to bring the same benefits to them.

• Expand into Adjacent Markets and Enhance Our Product Roadmap to Identify New Use Cases. We intend to leverage the versatility of our eASIC platform to develop new use cases and applications. As we deploy new capabilities including, but not limited to, higher-speed SerDes, increased logic and memory integration and lower power solutions, we plan to use our eASIC platform to expand into adjacent markets.

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• Invest in Key Sales and Technical Talent. As we grow, we intend to build upon our top tier customer base by increasing our geographic sales and technical resources to enable us to expand our market share with new and existing customers and in adjacent markets.

Risks Associated With Our Business

Our business is subject to numerous risks, as more fully described in the section entitled “Risk Factors” immediately following this prospectus summary. You should read these risks before you invest in our common stock. We may be unable, for many reasons, including those that are beyond our control, to implement our business strategy. In particular, risks associated with our business include:

• We depend on a limited number of customers for a substantial majority of our revenues. If we fail to retain or expand our customer relationships, our revenues would decline significantly.

• Our success and future revenues depend on our winning designs with our customers, and those customers designing our solutions into their product offerings and successfully selling and marketing such products. The design win process is generally a lengthy, expensive and competitive process, with no guarantee of revenue, and if we fail to generate sufficient revenues to offset our expenses, our business and operating results would suffer.

• Our customers may replace or substitute our custom IC solutions with different or lower cost solutions.

• The complexity of our custom IC solutions could result in unforeseen delays or expenses from undetected defects, erroneous spins or other bugs which could adversely affect our operating costs, reduce the market adoption of our solutions and damage our reputation with current or prospective customers.

• Our target markets may not grow or develop as we currently expect and if we fail to penetrate new markets and scale successfully within those markets, our revenues and financial condition would be harmed.

• We may experience difficulties demonstrating the value to customers of newer, higher priced and higher margin solutions if they believe existing solutions are adequate to meet end customer expectations, and our business would be harmed.

• Our VMI inventory strategy subjects us to risk of revenue volatility, which could negatively impact our operating results.

• Fluctuations in the mix of our custom IC products that we sell may adversely affect our financial results.

• We depend on third parties for substantially all of our manufacturing production and operations.

• We identified material weaknesses in our internal controls over financial reporting that were a result of the limited internal accounting resources available to us while we were a private company. If not properly remediated, these weaknesses could result in material misstatements in our financial statements in future periods and impair our ability to comply with the accounting and reporting requirements applicable to public companies.

Corporate Information

We were incorporated in Delaware in 1999. Our principal executive offices are located at 2585 Augustine Drive, Suite 100, Santa Clara, California 95054, and our telephone number is (408) 855-9200. Our corporate website address is www.easic.com. Information contained on or accessible through our website is not a part of this prospectus, should not be relied on in determining whether to make an investment decision, and the inclusion of our website address in this prospectus is an inactive textual reference only.

We have obtained registered trademarks for eASIC, easicopy and eASICore, The Configurable Logic Company and eZ-IP based on use of the trademarks in the United States. This prospectus contains references to

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our trademarks and to trademarks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this prospectus, including logos, artwork and other visual displays, may appear without the ^® or ^™ symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. We do not intend our use or display of other companies’ trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

Implications of Being an Emerging Growth Company

As a company with less than $1.0 billion in revenues during our last fiscal year, we qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act (JOBS Act), enacted in April 2012. An emerging growth company may take advantage of reduced reporting requirements that are otherwise applicable to public companies. These provisions include, but are not limited to:

• being permitted to present only two years of audited financial statements and only two years of related Management’s Discussion and Analysis of Financial Condition and Results of Operations in this prospectus;

• not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended;

• reduced disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and

• exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

We may use these provisions until the last day of our fiscal year following the fifth anniversary of the completion of this offering. However, if certain events occur prior to the end of such five-year period, including if we become a “large accelerated filer,” our annual gross revenues exceed $1.0 billion or we issue more than $1.0 billion of non-convertible debt in any three-year period, we will cease to be an emerging growth company prior to the end of such five-year period.

We have elected to take advantage of certain of the reduced disclosure obligations in the registration statement of which this prospectus is a part and may elect to take advantage of other reduced reporting requirements in future filings. As a result, the information that we provide to our stockholders may be different than you might receive from other public reporting companies in which you hold equity interests.

The JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. We have irrevocably elected not to avail ourselves of this exemption and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

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THE OFFERING

Common stock offered by us	shares
Common stock offered by the selling stockholders	shares
Common stock to be outstanding after this offering	shares
Over-allotment option offered by us	shares
Use of proceeds	We estimate that we will receive net proceeds of approximately $         million (or approximately $         million if the underwriters exercise their over-allotment option in full) from the sale of the shares of common stock offered by us in this offering, based on an assumed initial public offering price of $         per share (the midpoint of the price range set forth on the cover page of this prospectus), and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. We intend to use the net proceeds that we receive from this offering primarily for general corporate purposes, including working capital, sales and marketing activities, product development, general and administrative matters, and capital expenditures, although we do not currently have any specific or preliminary plans with respect to use of proceeds for such purposes. We also currently intend to use approximately $         million of the net proceeds we receive from this offering to prepay the entirety of the outstanding indebtedness, including applicable prepayment penalties, under our existing debt obligations, though our intentions to prepay our debt obligations may change due to market or other factors. We also may use a portion of the net proceeds that we receive to acquire complementary businesses, products, services or technologies; however, we do not have agreements or commitments for any specific acquisitions at this time. See “Use of Proceeds.” We will not receive any proceeds from the sale of shares to be offered by the selling stockholders. See “Principal and Selling Stockholders.”
Risk factors	You should read the “Risk Factors” section of this prospectus for a discussion of certain of the factors to consider carefully before deciding to purchase any shares of our common stock.
Proposed NASDAQ trading symbol	EASI

The number of shares of our common stock to be outstanding after this offering is based on 15,055,418 pro forma shares of common stock outstanding as of March 31, 2015, and excludes:

• 3,413,188 shares of common stock issuable upon the exercise of outstanding stock options as of March 31, 2015, at a weighted-average exercise price of $1.39 per share;

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• 2,865,129 shares of our common stock reserved for future issuance under our 2015 Equity Incentive Plan (2015 plan), which will become effective as of the date of the effectiveness of the registration statement of which this prospectus forms a part, which includes (i) 215,129 shares of common stock reserved for issuance under our 2010 Equity Incentive Plan, as amended (2010 plan), and (ii) stock options exercisable for an aggregate of 48,500 shares that our Compensation Committee has approved to be granted in connection with the pricing of our initial public offering with an exercise price equal to the initial public offering price;

• 530,000 shares of common stock reserved for future issuance under our 2015 employee stock purchase plan (2015 ESPP), which will become effective upon the execution and delivery of the underwriting agreement for this offering;

• 111,505 shares of common stock issuable upon the exercise of convertible preferred stock warrants outstanding as of March 31, 2015, at an exercise price of approximately $5.19 per share;

• 32,268 shares of common stock issuable upon the exercise of common stock warrants outstanding as of March 31, 2015, at an exercise price of approximately $15.50 per share; and

• 75,752 shares of common stock issuable upon the exercise of common stock warrants outstanding as of March 31, 2015, at a weighted-average exercise price of approximately $16.37 per share, that terminate unless exercised immediately prior to the completion of this offering.

Unless otherwise indicated, all information contained in this prospectus assumes or gives effect to:

• the filing of our amended and restated certificate of incorporation and the adoption of our amended and restated bylaws immediately prior to the completion of this offering;

• no exercise by the underwriters of their option to purchase up to an additional              shares of our common stock to cover over-allotments, if any;

• the conversion of all our convertible preferred stock outstanding as of March 31, 2015 into an aggregate of 5,145,683 shares of our common stock immediately prior to the completion of this offering;

• the 75-for-one reverse split of our common stock and our preferred stock that was effected on August 6, 2014;

• the termination and cancellation of all 533,301 outstanding shares of our Series A-1 non-convertible preferred stock upon the completion of this offering; and

• the automatic conversion of warrants to purchase 98,221 shares of our Series A-2 convertible preferred stock outstanding as of March 31, 2015 into warrants to purchase an aggregate of 111,505 shares of our common stock immediately prior to the completion of this offering.

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SUMMARY CONSOLIDATED FINANCIAL DATA

The summary consolidated statements of operations data presented below for the years ended December 31, 2012, 2013 and 2014 are derived from our audited consolidated financial statements included elsewhere in this prospectus. The summary consolidated statements of operations data presented below for the three months ended March 31, 2014 and 2015, and the summary consolidated balance sheet data as of March 31, 2015, are derived from our unaudited interim consolidated financial statements included elsewhere in this prospectus. The unaudited interim consolidated financial statements were prepared on a basis consistent with our audited consolidated financial statements and, in the opinion of management, include all adjustments of a normal, recurring nature that are necessary for the fair presentation of the financial statements. The following summary consolidated financial data should be read with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes included elsewhere in this prospectus. Our historical results are not necessarily indicative of the results that may be expected for any period in the future, and the results for the three months ended March 31, 2015 are not necessarily indicative of results to be expected for the full year 2015 or any future period.

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
										(Unaudited)
	(In thousands, except share and per share data)
Consolidated statements of operations data:
Revenues:
Product	$	11,843		$	26,111		$	65,086		$	12,265		$	19,658
Service		1,840			3,666			2,294			1,312			417
Total revenues		13,683			29,777			67,380			13,577			20,075
Cost of revenues(1):
Product		8,707			14,968			37,366			7,040			11,178
Service		373			748			636			420			190
Total cost of revenues		9,080			15,716			38,002			7,460			11,368
Gross profit		4,603			14,061			29,378			6,117			8,707
Operating expenses(1):
Research and development		11,898			13,026			13,870			3,038			3,701
Sales and marketing		4,494			4,834			5,711			1,183			1,331
General and administrative		2,543			3,076			5,449			746			2,491
Total operating expenses		18,935			20,936			25,030			4,967			7,523
Income (loss) from operations		(14,332	)		(6,875	)		4,348			1,150			1,184
Interest expense		(1,042	)		(935	)		(1,443	)		(301	)		(445	)
Other income (expense), net		72			12			(836	)		(88	)		(38	)
Income (loss) before income taxes		(15,302	)		(7,798	)		2,069			761			701
Benefit from (provision for) income taxes		(57	)		(44	)		(3,216	)		(360	)		5
Net income (loss)	$	(15,359	)	$	(7,842	)	$	(1,147	)	$	401		$	706
Add/(Less): Capital contribution from/(deemed dividend to) common stockholders(2)		83,386			(338	)		—			—			—
Less: Undistributed earnings allocated to preferred stockholders		—			—			—			(401	)		(706	)
Net income (loss) attributable to common stockholders	$	68,027		$	(8,180	)	$	(1,147	)	$	—		$	—
Net income (loss) per share attributable to common stockholders(3):
Basic	$	213.75		$	(0.90	)	$	(0.12	)	$	0.00		$	0.00
Diluted	$	(4.06	)	$	(0.90	)	$	(0.12	)	$	0.00		$	0.00
Weighted-average common shares used in computing net income (loss) per share attributable to common stockholders(3):
Basic		318,249			9,066,797			9,518,377			9,436,046			9,682,424
Diluted		3,786,303			9,066,797			9,518,377			9,436,046			9,682,424
Pro forma net income (loss) attributable to common stockholders (unaudited)(3)							$	(364	)				$	545
Pro forma net income (loss) per share attributable to common stockholders (unaudited)(3):
Basic							$	(0.02	)				$	0.04
Diluted							$	(0.02	)				$	0.03
Pro forma weighted-average common shares used in computing net income (loss) per share attributable to common stockholders (unaudited)(3):
Basic								14,664,060						14,828,107
Diluted								14,664,060						17,828,111

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(1) Stock-based compensation included in the consolidated statements of operations data above was as follows:

	Year Ended December 31,						Three Months Ended March 31,
	2012		2013		2014		2014		2015
							(Unaudited)
	(In thousands)
Cost of product revenues	$	1	$	5	$	5	$	1	$	1
Research and development		75		256		485		33		141
Sales and marketing		17		485		286		12		70
General and administrative		150		573		558		40		136
Total	$	243	$	1,319	$	1,334	$	86	$	348

(2) See Note 6 to our consolidated financial statements appearing elsewhere in this prospectus for an explanation of the capital contribution from/(deemed dividend to) common stockholders.

(3) See Notes 1 and 8 to our consolidated financial statements appearing elsewhere in this prospectus for an explanation of the calculations of our basic and diluted net income (loss) per share attributable to common stockholders and our basic and diluted pro forma net income (loss) per share attributable to common stockholders.

Our consolidated balance sheet as of March 31, 2015 is presented on:

• an actual basis;

• a pro forma basis, giving effect to the automatic conversion of all outstanding shares of our convertible preferred stock into 5,145,683 shares of common stock, the related reclassification of the preferred stock warrant liability to additional paid-in capital and the effectiveness of our amended and restated certificate of incorporation as of immediately prior to the completion of this offering, as if such conversion had occurred and our amended and restated certificate of incorporation had become effective on March 31, 2015; and

• a pro forma as adjusted basis, giving effect to the pro forma adjustments and the sale of              shares of common stock by us in this offering, based on an assumed initial public offering price of $         per share (the midpoint of the price range reflected on the cover page of this prospectus) after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

The pro forma as adjusted information set forth in the table below is illustrative only and will be adjusted based on the actual initial public offering price and other terms of this offering determined at pricing.

	As of March 31, 2015
	Actual			Pro Forma		Pro Forma As Adjusted(1)
	(Unaudited; In thousands)
Consolidated balance sheet data:
Cash and cash equivalents	$	9,222		$	9,222
Working capital		17,710			17,710
Total assets		41,179			41,179
Total deferred revenues		374			374
Total non-current income taxes payable		3,079			3,079
Total capital lease, non-current portion		221			221
Total long-term debt, non-current portion		15,024			15,024
Vendor financing arrangement		1,302			1,302
Convertible preferred stock warrant liabilities		1,042			—
Total preferred stock		41,286			—
Total stockholders’ equity (deficit)		(33,974	)		8,354

(1) Each $1.00 increase or decrease in an assumed initial public offering price of $         per share, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase or decrease, as

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applicable, our pro forma as adjusted cash and cash equivalents, working capital, total assets and total stockholders’ equity (deficit) by $         million, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. Each one million increase (decrease) in the number of shares offered by us as set forth on the cover page of this prospectus, would increase (decrease) each of our cash and cash equivalents, working capital (deficit), total asset, additional paid-in capital, and total stockholders’ equity by approximately $         million, assuming that the assumed initial public offering price of $         per share, which is the midpoint of the estimated offering price range reflected on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

Non-GAAP financial measures

We use the financial measures set forth below, which are non-GAAP financial measures, to help us analyze our financial results, establish budgets and operational goals for managing our business and to evaluate our performance. We also believe that the presentation of these non-GAAP financial measures in this prospectus provides an additional tool for investors to use in comparing our core business and results of operations over multiple periods with other companies in our industry, many of which present similar non-GAAP financial measures to investors. However, the non-GAAP financial measures presented in this prospectus may not be comparable to similarly titled measures reported by other companies due to differences in the way that these measures are calculated. The non-GAAP financial measures presented in this prospectus should not be considered as the sole measure of our performance and should not be considered in isolation from, or as a substitute for, comparable financial measures calculated in accordance with GAAP. The financial measures set forth below also contain certain comparable GAAP financial measures.

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
										(Unaudited)
	(In thousands, except percentages)
GAAP gross profit	$	4,603		$	14,061		$	29,378		$	6,117		$	8,707
GAAP gross margins		34	%		47	%		44	%		45	%		43	%
Non-GAAP gross profit	$	4,604		$	14,066		$	29,383		$	6,118		$	8,708
Non-GAAP gross margins		34	%		47	%		44	%		45	%		43	%
GAAP income (loss) from operations	$	(14,332	)	$	(6,875	)	$	4,348		$	1,150		$	1,184
GAAP operating margin (loss)		(105	%)		(23	%)		6	%		9	%		6	%
Non-GAAP income (loss) from operations	$	(14,089	)	$	(5,556	)	$	5,682		$	1,236		$	1,532
Non-GAAP operating margin (loss)		(103	%)		(19	%)		8	%		9	%		8	%
Adjusted EBITDA	$	(13,609	)	$	(5,010	)	$	6,589		$	1,385		$	1,959
Adjusted EBITDA margin		(99	%)		(17	%)		10	%		10	%		10	%
Cash flow provided by (used in) operating activities	$	(10,442	)	$	(13,478	)	$	542		$	(74	)	$	1,461
Free cash flow	$	(10,966	)	$	(15,607	)	$	(4,774	)	$	(1,852	)	$	1,100

Non-GAAP gross profit and margins. We define non-GAAP gross profit as gross profit as reported on our consolidated statements of operations, excluding the impact of stock-based compensation, which is a non-cash charge. We define non-GAAP gross margins as non-GAAP gross profit divided by revenues. We have presented non-GAAP gross profit and margins because we believe that the exclusion of stock-based compensation allows for more accurate comparisons of our results of operations to other companies in our industry. Please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures” for information regarding the limitations of using non-GAAP gross profit and gross margin as financial measures and for a reconciliation of non-GAAP gross profit to gross profit, the most directly comparable financial measure calculated in accordance with U.S. generally accepted accounting principles (GAAP).

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Non-GAAP income (loss) from operations and operating margin (loss). We define non-GAAP income (loss) from operations as income (loss) from operations as reported on our consolidated statements of operations, excluding the impact of the stock-based compensation, which is a non-cash charge. We define non-GAAP operating margin (loss) as non-GAAP income (loss) from operations divided by revenues. We have presented non-GAAP income (loss) from operations and operating margin (loss) because we believe that the exclusion of stock-based compensation gain allows for more accurate comparisons of our results of operations to other companies in our industry. Please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures” for information regarding the limitations of using non- GAAP income (loss) from operations and operating margin (loss) as financial measures and for a reconciliation of non-GAAP income (loss) from operations to income (loss) from operations, the most directly comparable financial measure calculated in accordance with GAAP.

Adjusted EBITDA and adjusted EBITDA margin. We define adjusted EBITDA as our net loss excluding: (1) stock-based compensation; (2) interest expense; (3) other income (expense), net, which primarily includes changes in value of preferred stock warrant liabilities and foreign exchange gains and losses; (4) depreciation and amortization; and (5) our provision for income taxes. We define adjusted EBITDA margin as adjusted EBITDA divided by revenues. We have presented adjusted EBITDA and adjusted EBITDA margin because we believe it is an important measure used by industry analysts and investors to compare our performance against our peer group and analyze our cash generation performance. In particular, we believe that the exclusion of the expenses eliminated in calculating adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core operating performance. Please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures” for information regarding the limitations of using adjusted EBITDA and adjusted EBITDA margin as financial measures and for a reconciliation of adjusted EBITDA to net loss, the most directly comparable financial measure calculated in accordance with GAAP.

Free cash flow. We define free cash flow as net cash provided by operating activities less property and equipment purchases, including certain mask sets. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that, after capital purchases, can be used for strategic opportunities, including investing in our business, making strategic acquisitions, and strengthening the balance sheet. Please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures” for more information and a reconciliation of free cash flow to cash flow provided used in operating activities, the most directly comparable financial measure calculated and presented in accordance with GAAP.

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RISK FACTORS

Investing in our common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described below, together with all of the other information in this prospectus, including our consolidated financial statements and related notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” before investing in our common stock. If any of the following risks are realized, in whole or in part, our business, financial condition, results of operations and prospects could be materially and adversely affected. In that event, the price of our common stock could decline, and you could lose part or all of your investment. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business operation.

Risks Related to Our Business and Our Industry

We depend on a limited number of customers for a substantial majority of our revenues. If we fail to retain or expand our customer relationships, our revenues would decline significantly.

We derive a substantial majority of our revenues from a limited number of customers. We believe that our operating results for the foreseeable future will continue to depend on sales to relatively small number of customers. In 2012, 2013, 2014 and the first three months of 2015, Ericsson Inc. (Ericsson) and Seagate Technology plc (Seagate) together accounted for 73%, 87%, 93% and 95%, respectively, of our total revenues. In the future, these significant customers may decide not to purchase our custom IC solutions at all, may purchase fewer units than they did in the past or may alter their purchasing patterns by replacing or substituting our IC solutions with different or lower cost solutions. For example, Ericsson, which represented approximately 62% and 79% of our total revenues in 2014 and the first three months of 2015, respectively, announced their intention to develop certain stock-keeping units for products using alternative solutions which will compete with stock-keeping units which utilize our solution. Over time, the alternative stock-keeping units may decrease the revenue and market acceptance of the stock-keeping units with our solution built in. While we expect the stock-keeping units with our solution to remain in production for the foreseeable future and expect to secure other design wins with Ericsson in the future, we cannot provide assurance that this will occur, and lower than expected sales of stock-keeping units with our solution or a failure to achieve design wins in the future would have an adverse impact on our revenues and harm our financial condition and results of operations.

In addition, our relationships with some customers may deter other potential customers that compete with these customers from buying our solutions. The loss of a key customer, such as Ericsson or Seagate, a reduction in sales to any key customer or the cancellation of a substantial order could happen at any time with limited notice, which in turn would negatively impact our revenues and harm our financial condition and results of operations. Further, the primary markets in which we participate including the wireless and wired infrastructure communications and storage markets, are highly concentrated in the number of companies that serve those markets. As a result, we expect that a high percentage of our revenues will be attributable to a small number of customers in these highly concentrated markets for the foreseeable future.

Our success and future revenues depend on us winning designs with our customers, and those customers designing our solutions into their product offerings and successfully selling and marketing such products. If we do not continue to win designs in the short term, our revenues in the following years will deteriorate.

We sell our custom IC solutions to original equipment manufacturer (OEM) customers that include our solutions in their hardware products. Our technology is generally incorporated into products at the design stage, which we refer to as a design win. As a result, our future revenues depend on our OEM customers designing our custom ICs into their products, and on those products being produced in volume and successfully commercialized. If we fail to convince our current or prospective OEM customers to include our custom ICs in their products and fail to achieve a consistent number of design wins, our results of operations and business will be harmed. In addition, if a current or prospective customer designs a competitor’s offering into its product, it becomes significantly more difficult for us to sell our custom IC solutions to that OEM because changing suppliers involves significant cost, time, effort and risk for the OEM. Even if an OEM customer designs one of

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our custom ICs into its product, we cannot be assured that the OEM’s product will be commercially successful over time or at all or that we will receive or continue to receive any revenues from that customer. Because of our extended sales cycle, our revenues in future years are highly dependent on design wins we are awarded today. For example, we are currently shipping a majority of our revenues from design wins that we were awarded more than 12 months ago, and it is typical that a design win today will not result in meaningful revenues until one year or later, if at all. If we do not continue to win designs in the short term, our revenues in the following years will deteriorate.

The design win process is generally a lengthy, expensive and competitive process, with no guarantee of revenue, and if we fail to generate sufficient revenues to offset our expenses, our business and operating results would suffer.

Achieving a design win is typically a lengthy, expensive and competitive process because our customers generally take a considerable amount of time to evaluate our custom IC solutions. The time from early engagement by our sales force to actual product introduction typically runs from 21 to 24 months for our current end markets, though it may take longer for new customers or markets we intend to address. In order to win designs, we are required to both incur design and development costs and dedicate substantial engineering resources in pursuit of a single customer opportunity. Even though we incur these costs, we may not prevail in the competitive selection process and, even if we do achieve a design win, we may never generate sufficient, or any, revenues to offset our development expenditures. For example, some of our end customers’ products may have short life cycles which would limit our ability to recoup our upfront expenditures for those customers’ products. In addition, for certain very high production volume ICs, customers may determine, and have in the past determined, that their products do not require our solution to address the needs of their consumers, and therefore use a standard ASIC from another supplier rather than our custom solution. The extent to which our solution is used will vary depending on a number of factors, many of which are out of our control. As a result, despite incurring significant expenses in the development and design of our custom IC solution for a particular customer, we may not be able to generate revenues to offset those expenses or at all to the extent that customer decides to choose an alternative supplier solution over ours.

Our customers have the option to decide whether or not to put our solutions into production after we have completed our design and prototype work. The delays inherent in our protracted sales cycle increase the risk that a customer will decide to cancel, curtail, reduce or delay its product plans, causing us to lose anticipated revenues. In addition, any change, delay or cancellation of a customer’s plans could harm our financial results, as we may have incurred significant expense while generating no revenues. For example, in August 2014, a large customer cancelled a program that included our product for which we had already produced a successful prototype custom IC and were beginning production of our customized IC in anticipation of substantial customer orders. This cancellation resulted in no return on the significant operating expenses we incurred and the write off of certain production assets, which had a negative impact on our gross margins and our quarterly results of operations.

Fluctuations in the mix of our custom IC products that we sell may adversely affect our financial results.

The average selling price, or ASP, for each of our ASIC designs can be determined by a number of factors, including the complexity of the design, the customer’s application, the customer’s relative negotiation power and the volume levels to be produced. ASPs are negotiated either when the initial design is awarded by the customer, or during annual negotiation cycles between us and the customer. Because of the wide price differences among our custom IC products, the mix of the ICs we sell affects the average selling price of such products and has a substantial impact on our revenues and gross margins. We offer custom ICs with both higher and lower gross margins in our eASIC platform and ASIC products designed using our easicopy or standard ASIC methodologies. A significant shift in the mix from high margin custom ICs to low margin custom ICs would have a material impact on our overall gross margins. Fluctuations in the mix and types of our products may also affect the extent to which we are able to recover our fixed costs and investments that are associated with a particular product, and as a result could adversely affect our financial results.

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The average selling prices of products in our markets have historically decreased over time and may do so in the future, which could harm our revenues and gross margins.

Average selling prices of semiconductor products in the markets we serve have historically decreased over time. Our revenues come from sales to large customers that have expectations of annual reductions in their purchase price. The average selling prices of our products generally decline as the products mature. In addition, our solutions are designed to address markets requiring high volumes of chips for their products and, at certain high volume levels, our competitors may offer our customers lower cost standard ASICs for their products. Although we can often address these customers’ needs through our easicopy ASICs or a standard ASIC methodology, our customers may design other solutions into their products. In addition, in order to compete with these lower-cost chips, we may be forced to lower the average selling prices of our solutions.

We seek to offset the reductions in our average selling prices and increase gross margins by reducing the development cost of our IC solutions, developing new or enhanced lower-cost solutions on a timely basis and increasing unit sales. However, there is no guarantee that our efforts will be successful or that they will keep pace with the decline in selling prices of our products, which could ultimately lead to a decline in our revenues and have a negative effect on our gross margins. We may also not be able to increase our sales volume of these lower-cost solutions or achieve the necessary volume of production that would lead to further per unit cost reductions. We expect that we will have to continue to address pricing pressures in the future, which could require us to reduce the prices of our solutions and harm our operating results. If we are unsuccessful in reducing our costs, developing new or enhanced products on a timely basis with higher selling prices or gross profits or increasing our volumes, our business will be harmed.

The complexity of our custom IC solutions could result in unforeseen delays or expenses from undetected defects, erroneous spins or other bugs which could adversely affect our operating costs, reduce the market adoption of our solutions and damage our reputation with current or prospective customers.

Our custom IC solutions are very complex. Given this complexity, our IC solutions have in the past and may in the future contain defects, errors and bugs in production and when they are first introduced or as new versions are released. These defects, errors or bugs could interrupt or delay sale to customers, thus delaying or reducing our revenues. If we incorrectly design a custom IC solution, we may need to modify such solution, which could require significant expenditures and would negatively impact our return on investment. Moreover, if such modifications negatively impact our customers’ product plans, our customers may cancel their program that uses our solution. For example, although the impact to our revenues for this particular case was minimal, in the third quarter of 2014, a customer cancelled a program due to a number of respins that led them to cancel their product plans. If any of our custom IC solutions have reliability, quality or compatibility problems, we may not be able to successfully correct these problems in a timely manner, or at all. If defects, errors or bugs are not found until late in the design cycle or even after we have commenced commercial production of a new product, we may incur significant additional development costs and product recall, repair or replacement costs. These problems may also result in claims against us by our customers or others. Any defects, errors or bugs may damage our reputation and harm our ability to retain existing customers or attract new customers, which in turn would adversely affect our business and financial results.

The success of our custom IC solutions is dependent on our customers’ ability to develop products that achieve market acceptance and are free of design flaws, and our customers’ failure to do so could have a material adverse effect on our business.

The success of our custom IC solutions is heavily dependent on the timely introduction, quality and market acceptance of our customers’ products incorporating our solutions. Our customers’ products are often very complex and subject to design complexities that may result in design flaws, as well as potential defects, errors and bugs. We have in the past been subject to delays and project cancellations as a result of design flaws in the products developed by our customers. In the past we have also been subject to delays and project cancellations as a result of changing market requirements, such as the customer adding a new feature, or because a customer’s

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product fails their end customer’s evaluation or field trial. Other times customer products are delayed due to incompatible deliverables or shortages in component parts from other vendors. We incur significant design and development costs in connection with designing our custom IC solutions for customers’ products and if our customers discover design flaws, defects, errors or bugs, in their products, or if they experience changing market requirements, failed evaluations or field trials, or incompatible deliverables or shortages in component parts from other vendors, they may delay, change or cancel a project, and we may have incurred significant additional development costs and may not be able to recoup our costs, which in turn would adversely affect our business and financial results.

Our target markets may not grow or develop as we currently expect, and if we fail to penetrate new markets and scale successfully within those markets, our revenues and financial condition would be harmed.

Approximately 87% of our revenues for 2013 and 94% of our revenues for 2014 were derived from customers participating in the wireless communications infrastructure and storage markets. Any deterioration in these markets or reduction in capital spending to support these markets could lead to a reduction in demand for our products, which would adversely affect our revenues and results of operations. Our operating results are increasingly affected by trends in these end markets, including increased demand for customization, faster time-to-market, lower costs and lower power consumption, and increased integration of functions into standard ASICs. We may be unable to predict the timing or development of trends in these end markets with any accuracy. While certain of these trends have been beneficial to us, it may not be the case in the future with other end market trends. A market shift towards a standard that we may not support could significantly decrease the demand for our solutions. If our target markets do not grow or develop in ways that we currently expect, demand for our technology may not materialize as expected and our business and operating results would suffer.

In the past several years, a significant amount of our revenues have been generated from sales of our solutions to customers that develop wireless communication infrastructure and storage products. Our future revenue growth, if any, will depend in part on our ability to expand within our existing markets, but also to enter new markets, such as the wired communication infrastructure, medical, and industrial markets. Each of these markets presents distinct and substantial challenges and risks and, in many cases, requires us to develop new customized solutions to address the particular requirements of that market. Meeting the technical requirements and securing design wins in any of these new markets will require a substantial investment of our time and resources. We cannot assure you that we will secure design wins from these or other new markets, or that we will achieve meaningful revenues from sales with these markets. Some of these markets are primarily served by only a few large, multinational OEMs with substantial negotiating and buying power relative to us and, in some instances, with internally developed silicon solutions that can be competitive to our products. If any of these markets do not develop as we currently anticipate or if we are unable to penetrate them and scale in them successfully, our future revenues would decline and our business would be negatively affected.

We may experience difficulties demonstrating the value to customers of newer, higher priced and higher margin solutions if they believe existing solutions are adequate to meet end customer expectations, and to that extent our business would be harmed.

As we develop and introduce new solutions, we face the risk that customers may not value or be willing to bear the cost of incorporating these newer solutions into their products, particularly if they believe their customers are satisfied with current solutions. Regardless of the improved features or superior performance of the newer solutions, customers may be unwilling to adopt our new solutions due to design or pricing constraints. Because of the extensive time and resources that we invest in developing new solutions, if we are unable to sell customers new generations of our solutions, our revenues could decline and our business, financial condition, results of operations and cash flows would be negatively affected.

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Our business depends substantially on our customers purchasing additional solutions from us. Any decline in our customer retention or expansion could harm our future results of operations.

As a critical component of maintaining or improving our results of operations, it is important that our customers purchase additional solutions from us after their initial orders. This may require increasingly sophisticated and costly sales efforts and may not result in additional sales. In addition, the rate at which our customers purchase additional solutions depends on a number of factors, including the perceived need for additional solutions for their product plans as well as general economic conditions. If our efforts to sell additional solutions to our customers are not successful, our business could suffer.

Our VMI inventory strategy subjects us to risk of revenue volatility, which could negatively impact our operating results.

Substantially all of our sales are made on a Vendor Managed Inventory (VMI) basis in which we maintain our product inventory at a customer specified location, which we refer to as a hub. Title to that inventory transfers to our customer, and revenues are recognized, when our products are “pulled” from our hub locations by, or delivered to, our customers, the timing for which is entirely determined by our customers. We invoice our customer when this pull transaction occurs. This VMI arrangement causes us to carry a significant amount of inventory on our balance sheet and extends our cash collection cycle. Moreover, our customers are generally not required to make any certain level of purchases within any given quarter and our customers typically do not provide us with firm, long-term purchase commitments, however, we do have certain contractual protections for inventory levels mandated by the customer. A substantial majority of our sales are made on a just-in-time basis through the hub. Accordingly, our customers may make frequent changes to their levels of product purchases with little or no notice to us and without penalty, which may include reductions, cancellations or delays in their product purchases. These changes make our revenues and gross margins volatile from period to period, as they will be highly dependent on the production schedules of our customers. Because production lead times often exceed the amount of time required by our customers to place their orders, we often must build our custom IC solutions in advance of the actual placement of orders, relying on an imperfect demand forecast to project volumes and customer mix. In addition, we maintain the risk of loss on such inventory, and though we cover insurance for lost inventory, such insurance may not be sufficient to cover any losses we may incur.

Our customers generally provide us with non-binding six-month rolling forecasts of their supply needs, and these forecasts vary significantly for each customer and for each six-month period. Accordingly, we have limited visibility as to our customers’ supply needs for more than two quarters out and those forecasts can vary widely from period to period and even within any quarterly period or periods, and as a result, are not always reliable indicators of future demand. In addition, our revenues are small relative to the large markets that we serve. As a result, we have limited understanding of the customer or end-user market drivers that could impact our revenue from one quarter to the next. As a result, our ability to accurately forecast demand is limited and can be adversely affected by a number of factors, including:

• inaccurate forecasting by our customers;

• miscalculations by our customers of their inventory requirements;

• changes in market conditions; and

• fluctuations in demand for our customers’ products.

Even after a forecast is received, our customers may not place orders or pull inventory from our hub locations. Forecasting our gross margins is difficult because a significant portion of our business is based on multiple pulls by large customers from a hub within the same quarter. If we fail to accurately forecast demand for our solutions or such demand is lower than we expect, then our anticipated sales may not materialize on schedule or at all, and we may experience unanticipated revenue volatility or shortfalls and could possess excess or obsolete inventory or lack sufficient inventory that we may be unable to sell to other customers, any of which could have an adverse impact on our business.

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If we or our customers are unable to project customer requirements accurately, we may not build enough units due to the long lead times for our products from our foundries, which could lead to delays in product shipments and lost sales opportunities in the near term, as well as force our customers to identify alternative solutions, including designing us out of their products, which could affect our ongoing relationships with these customers and decrease our revenues. We have in the past had customers significantly increase their requested production quantities with little or no advance notice. If we do not fulfill customer demands in a timely manner, our customers may cancel their orders, decrease their future orders, or not pull from our hub locations. In addition, the rapid pace of innovation in our industry could render portions of our inventory obsolete. Excess or obsolete inventory levels could result in unexpected expenses or increases in our reserves that could adversely affect our business, results of operations and financial condition.

Our gross margins may fluctuate due to a variety of factors, which could negatively impact our gross margins, results of operations and our financial condition.

Our gross margins may fluctuate due to a number of factors, including customer mix, market acceptance of our new products, yield, wafer pricing, competitive pricing dynamics, and geographic and market segment pricing strategies.

Further, because we are so dependent on a few large customers, these customers have significant leverage with respect to negotiating pricing and other terms with us and may put downward pressure on our margins. To attract new customers or retain existing customers, we have in the past and will in the future offer certain customers favorable prices on our solutions, which would decrease our average selling prices and may impact gross margins. To retain our revenues levels, we may also be forced to offer pricing incentives to our customers to incent them to continue current production levels or cancel or delay their cost reduction programs. For example, during the fourth quarter of 2014, we negotiated with one of our largest customers for a reduction in future pricing based on that customer having increased its forecasted purchase volume.

In addition, as we capitalize the cost of certain of our base arrays after we have tested the technological feasibility of the array and estimated market demand for products using the tested array, a subsequent determination that those base arrays will not be successful in the market would result in our expensing those assets to our cost of goods sold, which would hurt our gross margins and harm our financial condition and results of operations in the period we make that determination.

Because we do not operate our own manufacturing, assembly or testing facilities, we may not be able to reduce our costs as rapidly as companies that operate their own facilities, and our costs may even increase, which could further reduce our gross margins. We rely primarily on obtaining yield improvements and volume-based cost reductions to drive cost reductions in the manufacture of existing products, introducing new products that incorporate advanced features and optimize die size, and other price and performance factors that enable us to increase revenues while maintaining consistent margins. To the extent that such cost reductions and new product introductions do not occur in a timely manner, or to the extent that our products do not achieve market acceptance at prices with higher margins, our financial condition and results of operations could be adversely affected.

In addition, we maintain inventory of our products at various stages of production and in finished good inventory. We hold these inventories in anticipation of customer orders. If those customer orders do not materialize we may have excess or obsolete inventory which we would have to reserve or write off. In such case, our gross margins would be adversely affected.

If we are unable to successfully develop and introduce new products which achieve market acceptance, we may fail to maintain or increase our market share, which in turn would harm our competitive position and our business and operating results.

Our success depends in large part on our ability to develop and introduce new products based on our custom IC solutions that address customer requirements and compete effectively on the basis of price, functionality and

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performance. The success of new product introductions is dependent upon several factors, including:

• our ability to anticipate customer needs and determine market demand;

• our ability to develop products that effectively address those needs and achieve our customers’ strategic goals;

• timely completion and first pass success of new product designs;

• customer acceptance of advanced features in our new products;

• our ability to utilize advanced manufacturing process technologies on circuit geometries of 28nm and smaller;

• our ability to develop and support our internally developed software design tools;

• our ability to obtain advanced packaging;

• our ability to generate new design opportunities and design wins;

• the availability of specialized field application engineering resources supporting demand creation and customer adoption of new products;

• our ability to compete successfully with the price, performance, functionality and power characteristics of alternative solutions such as standard ASICs, ASSPs or FPGAs; and

• the timely introduction, quality and market acceptance of our customers’ products.

Our product research and development efforts may not be successful and our new products may not address the needs of our current and prospective customers or achieve market acceptance. Revenues relating to our mature products are expected to decline in the future, which is normal for our product life cycles. As of March 31, 2015, substantially all of our revenues were from 45 nanometer or older process nodes from which we have been selling and shipping products since the third quarter of 2008. We estimate the life of each eASIC platform process technology to be at least eight years. As the process technology matures, we become increasingly dependent on revenues derived from design wins from newer process technologies as well as anticipated cost reductions in the manufacture of our current products. To the extent that such new product introductions do not occur in a timely manner, or to the extent that our products do not achieve market acceptance at prices with acceptable margins, our financial condition and results of operations would be adversely affected. In addition, we have only recently begun selling our 28 nanometer process node generation of our eASIC platform. As a result, revenues from our 28 nanometer process node products are just beginning to ramp. While we have been able to demonstrate to our customers certain levels of reductions in power consumption, increased performance or lower design and manufacturing time, the number of instances where we have had the opportunity to demonstrate such results to date has been limited. We cannot be certain that we will be able to demonstrate to our customers the same level of reductions in power consumption, increased performance or lower design and manufacturing time that we have seen to date or that such relative comparisons will not change over time. Accordingly, this generation of our eASIC platform has not generated significant revenues to date and may not achieve broad market adoption.

Our eASIC platform relies on base arrays which require significant expenditures and may not meet market requirements or be commercially successful.

Our solutions incorporate the architecture of our eASIC platform which relies on our versatile, pre-defined and reusable base array of standard mask layers and an adaptable single mask layer which is layered into the base array, and customized using our proprietary software tools. This platform requires substantial capital expenditures that we have historically funded with our own working capital. If the custom ICs that we have developed, or which we may develop in the future, based on our eASIC platform do not meet the requirements of our customers or otherwise gain market acceptance, then we will not experience revenue growth and our business and results of operations will be harmed. In addition, as we capitalize the cost of certain of our base arrays after we have tested the technological feasibility of the array and estimated market demand for products using the

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tested array, a subsequent determination that those base arrays will not be successful in the market would result in our expensing those assets to our cost of goods sold, which would hurt our gross margins and harm our financial condition and results of operations in the period we make that determination. Because we have expended, and expect to continue to expend, a substantial amount of our resources on the development of our eASIC platform and the base arrays utilized in our platform, we may not have sufficient cash to fund base arrays that are commercially viable or that will increase or sustain the market acceptance of our solutions, which could harm our revenues and competitive position.

If we fail to compete effectively, we may lose or fail to gain market share, which could negatively impact our operating results and our business.

The global semiconductor market in general, and the wireless communications infrastructure and storage markets in particular, are highly competitive. We compete in different target markets on the basis of a number of competitive factors. We expect competition to increase and intensify as additional semiconductor companies enter our markets, and as internal silicon design resources of large OEMs grow. Increased competition could result in price pressure, reduced gross margins and loss of market share, any of which could harm our business, revenues and results of operations.

Our competitors range from large, international companies offering a wide range of semiconductor products to smaller companies specializing in narrow market verticals. In our markets, our primary competitors are Altera, Avago, Broadcom, Marvell, Toshiba and Xilinx. We expect competition in our current markets to increase in the future as existing competitors improve or expand their product offerings and as new competitors enter these markets.

Our ability to compete successfully depends on elements both within and outside of our control, including industry and general economic trends. Many of our competitors are substantially larger, have greater financial, technical, marketing, distribution, customer support and other resources, are more established than we are and have significantly better brand recognition and broader product offerings which may enable them to better withstand adverse economic or market conditions in the future and reducing their pricing so as to compete against us. Our ability to compete successfully will depend on a number of factors, including:

• our ability to define, design and regularly introduce new products that anticipate the functionality and integration needs of our customers’ next-generation products and applications;

• our ability to build strong and long-lasting relationships with our customers and other industry participants;

• our ability to capitalize on, and prevent losses due to, vertical integration by significant customers, including Ericsson and Seagate;

• our solutions’ performance and cost-effectiveness relative to that of competing products;

• our ability to convince customers of our capability to create lower cost standard ASICs using our easicopy methodology, if and when required by the customer;

• the effectiveness and success of our customers’ products utilizing our solutions within their competitive end markets;

• our research and development capabilities to provide innovative solutions and maintain our product roadmap;

• the strength of our sales and marketing efforts, and our brand awareness and reputation;

• our ability to deliver products in volume on a timely basis at competitive prices;

• our ability to expand international operations in a cost-effective manner;

• our ability to protect our IP and obtain IP rights from third parties that may be necessary to meet the evolving demands of the market;

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• our ability to promote and support our customers’ incorporation of our solutions into their products;

• our ability to continue to develop products at each new technology node; and

• our ability to retain high-level talent, including our management team and engineers.

Our competitors may also establish cooperative relationships among themselves or with third parties or acquire companies that provide similar products to ours. As a result, new competitors or alliances may emerge that could acquire significant market share. Any of these factors, alone or in combination with others, could harm our business and result in a loss of market share and an increase in pricing pressure. In addition, a number of our competitors are able to sell their solutions through multiple channels, including through distributors and third-party sales organizations, while we rely primarily on direct sales, which may provide our competitors with a strategic advantage in sales of their solutions and could harm our prospects and business.

Our industry is subject to rapidly changing standards. We may be unable to make the substantial investments that are required to remain competitive in our business.

We design certain of our products to conform to current industry standards. Some industry standards may not be widely adopted or implemented uniformly, and competing standards may emerge that may be preferred by our customers or by our third party suppliers. If our customers or our third-party suppliers adopt new or competing industry standards with which our solutions are not compatible, or if the industry groups fail to adopt standards with which our solutions are compatible, our existing solutions would become less desirable to our current or prospective customers. As a result, our sales would suffer, and we could be required to make significant expenditures to develop new solutions. In addition, existing standards may be challenged as infringing upon the intellectual property rights of other companies or may be superseded by new innovations or standards.

The semiconductor industry requires substantial investment in research and development in order to bring to market new and enhanced solutions. Our research and development expense was $11.9 million, $13.0 million, $13.9 million, and $3.7 million for the years ended December 31, 2012, 2013 and 2014 and the three months ended March 31, 2015, respectively. We expect to increase our research and development expenditures as compared to prior periods as part of our strategy to increase demand for our solutions in our current markets and expanding into additional markets. We are a small company with limited resources, and limited experience achieving revenues. We may not have sufficient resources to maintain the level of investment in research and development required to remain competitive. In addition, we cannot assure you that the technologies which are the focus of our research and development expenditures will become commercially successful or generate any revenues.

If we fail to continue to develop internal design tools to differentiate our products, our future growth and revenues could suffer.

We have our own internally developed and maintained software design tools, which we refer to as eTools, that we and our customers use to design the single mask layer that is incorporated into our eASIC Nextreme product family. We depend on eTools to differentiate our custom IC solutions. We must enhance these tools when we advance to each new technology node, and potentially when we add new intellectual property (IP) into our base arrays. If we are unable to continue to develop and support these tools, including maintaining and increasing the usability of the tools by our customers, then our ability to retain existing customers and attract new ones could decline, which would harm our financial results and negatively impact our results of operations.

We rely on third parties to provide software tools and technology necessary for our solutions and on third-party services for the operation of our business. Any failure of one or more of our vendors, suppliers or licensors to provide such tools, technology or services could harm our business.

We rely on third-party software tools to assist us in the design and verification of new solutions, and we incorporate third-party technology into some of our solutions. To bring new solutions and enhancements to

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market in a timely manner, or at all, we need software and hardware development tools that are sophisticated enough or technologically advanced enough to complete our design and verifications. The design requirements necessary to meet consumer demands for solutions we may develop in the future may exceed the capabilities of the software design tools available today or that we may develop in the future. This, in turn, may result in our missing design cycles or losing design wins, either of which could result in a loss of market share or negatively impact our results of operations.

Our solutions often require that we invest in third-party IP to meet certain market expectations on functionality requirements, which can be expensive to procure and integrate into our products. If we select the wrong IP to integrate into our products, or we cannot obtain such IP on reasonable terms, we may not meet our revenue growth expectations, or we may be forced to write off the value of that IP and our financial results, cash flows and business would be harmed.

The commercial viability of our custom IC solutions could be impaired if errors occur in the third-party technology we use or if we are unable to access third-party software tools. It may be more difficult for us to correct any errors in a timely manner, if at all, because the development and maintenance of the technology is not within our control. We cannot assure you that these third parties will continue to make their technology, or improvements to the technology, available to us, or that they will continue to support and maintain their technology. For example, in 2012, one of our key partners, Magma Design Automation, Inc., which provided us with critical software tools for the production of our 90nm eASIC Nextreme platform, was acquired by Synopsys, Inc. Synopsys notified us of their intent to discontinue support for that product. Subsequently, we moved designs to the 45nm, which eliminated our need for this software. Further, due to the limited number of vendors of some types of technology, it may be time-consuming or expensive to obtain new licenses or replace existing technology. Any impairment of the technology of or our relationship with these third parties could harm our business.

We also rely on third-party vendors to provide critical design services and services for our operations that we cannot or do not create or provide ourselves. Although we believe that adequate substitutes are currently available, we depend on these vendors to consistently meet our business requirements. The ability of these third-party vendors to successfully provide reliable and high-quality services is subject to technical and operational uncertainties that are beyond our control. While we may be entitled to damages if our vendors fail to perform under their agreements with us, our agreements with these vendors may limit the amount of damages we may receive. In addition, we do not know whether we will be able to collect on any damages, and there is no guarantee that any award of damages we do collect would be sufficient to cover the actual costs we would incur or for which we may be liable to our customers as a result of any vendor’s failure to perform under its agreement with us. We may not be able to replace the services provided to us by any third-party vendors in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us, and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete. Any disruption in critical services provided by these third-party vendors could harm our financial results and negatively impact our results of operations.

We depend on third parties for substantially all of our manufacturing operations, including our wafer fabrication, assembly and testing operations which exposes us to certain risks that may harm our business.

We rely on third parties for substantially all of our manufacturing production and operations, including wafer fabrication, assembly and testing. Although we use multiple third-party supplier sources, we depend on these third parties to supply us with material of a requested quantity in a timely manner that meets our standards for yield, cost and manufacturing quality. We do not have any long-term supply agreements with any of our manufacturing suppliers. These third-party manufacturers often serve customers that are larger than us or require a greater portion of their services, which may decrease our relative importance and negotiating leverage with these third parties.

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If market demand for wafers exceeds foundry capacity, if market demand for wafers or production and assembly materials increases, or if a supplier of our wafers ceases or suspends operations, our supply of wafers and other materials could become limited. Such shortages of wafers and materials as well as increases in wafer or materials prices could adversely affect our gross margins and could adversely affect our ability to meet customer demands in a timely manner, or at all, and lead to reduced revenues. Moreover, wafers constitute a large portion of our product cost. If we are unable to purchase wafers at favorable prices, our gross margins would be adversely affected.

To ensure continued wafer supply, we may be required to establish other wafer supply sources as these arrangements become economically advantageous or technically necessary, which could require significant expenditures and limit our negotiating leverage. In addition, only a few foundry vendors have the capability to manufacture our most advanced solutions. If we engage alternative supply sources, we may encounter start-up difficulties and incur additional costs. In addition, shipments could be significantly delayed while these sources are qualified for volume production.

Certain of our solutions are manufactured or tested in a single location, or a few locations. Certain of these facilities are located internationally, where we are subject to increased risk of political and economic instability, difficulties in managing operations, difficulties in enforcing contracts and our intellectual property rights, and employment and labor difficulties. Any of these factors could result in manufacturing and supply problems, and delays in our ability to provide our solutions to our customers on a timely basis. If we experience manufacturing problems at a particular location, we may be required to transfer manufacturing to a new location or supplier. Converting or transferring manufacturing from a primary location or supplier to a backup fabrication facility could be expensive and could take two or more quarters. During such a transition, we would be required to meet customer demand from our then-existing inventory, as well as any partially finished goods that could be modified to the required product specifications. We do not seek to maintain sufficient inventory to address a lengthy transition period because we believe it is uneconomical to keep more than minimal inventory on hand. As a result, we may not be able to meet customer needs during such a transition, which could delay shipments, cause production delays, result in a decline in our sales and damage our customer relationships.

If one or more of these vendors terminates its relationship with us, or if we encounter any problems with our manufacturing supply chain, our ability to ship our solutions to our customers on time and in the quantity required would be adversely affected, which in turn could cause an unanticipated decline in our sales and damage our customer relationships.

If our foundries do not achieve satisfactory yields or quality, our reputation and customer relationships could be harmed.

We depend not only on sufficient foundry manufacturing capacity and wafer prices, but also on good production yields (the number of good die per wafer) and timely wafer delivery to meet customer demand and maintain profit margins. The fabrication of our products is a complex and technically demanding process. Minor deviations in the manufacturing process can cause substantial decreases in yields, and in some cases, cause production to be suspended. Our foundry vendors, Fujitsu, Global Foundries (GF) and Taiwan Semiconductor Manufacturing Company (TSMC), collectively our foundries, from time to time, experience manufacturing defects and reduced manufacturing yields. Changes in manufacturing processes or the inadvertent use of defective or contaminated materials by our foundries could result in lower than anticipated manufacturing yields or unacceptable performance of our devices. Many of these problems are difficult to detect at an early stage of the manufacturing process and may be time consuming and expensive to correct. Poor yields from our foundries, or defects, integration issues or other performance problems in our solutions, could cause us significant customer relations and business reputation problems, harm our financial results and give rise to financial or other damages to our customers. Our customers might consequently seek damages from us for their losses. A product liability claim brought against us, even if unsuccessful, would likely be time consuming and costly to defend.

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We may experience difficulties in transitioning to new wafer fabrication process technologies or in achieving higher levels of design integration, which may result in reduced manufacturing yields, delays in product deliveries and increased costs.

We aim to use the most advanced manufacturing process technology appropriate for our solutions that is available from our third-party foundries. As a result, we periodically evaluate the benefits of migrating our solutions to other technologies in order to improve performance and reduce costs. These ongoing efforts require us from time to time to modify the manufacturing processes for our products and to redesign some products, which in turn may result in delays in product deliveries. We may face difficulties, delays and increased expense as we transition our products to new processes, and potentially to new foundries. We depend on our foundries as the principal foundries for our solutions, to transition to new processes successfully. We cannot assure you that our foundries will be able to effectively manage such transitions or that we will be able to maintain our relationship with our foundries or develop relationships with new foundries. If we or any of our foundries experience significant delays in transitioning to smaller geometries or fail to efficiently implement transitions, we could experience reduced manufacturing yields, delays in product deliveries and increased costs, any of which could harm our relationships with our customers and our operating results.

We have a limited history of profitability, and we may not achieve or sustain profitability in the future, on a quarterly or annual basis.

We incurred net loss for 2013 and 2014 in the amount of $7.8 million and $1.1 million, respectively. Even though we earned net income of $0.7 million for the three months ended March 31, 2015, our accumulated deficit was $45.7 million as of March 31, 2015. We expect to make significant expenditures related to the development of our products and expansion of our business, including research and development and sales and administrative expenses. Additionally, we may encounter unforeseen difficulties, complications, product delays and other unknown factors that may require additional expenditures. As a result of these expenditures, we may not generate sufficient revenues to achieve profitability.

If we do not sustain our growth rate, we may not be able to execute our business plan and our operating results and stock price could suffer.

We have recently experienced significant growth. Our revenues increased from $29.8 million in fiscal year 2013 to $67.4 million in fiscal year 2014, representing an annual growth rate of 126%. We do not expect to continue to grow at these historical percentage rates, and we may not be able to grow or sustain our revenues at all in the future. In addition, we expect expenses to increase substantially in the near term, particularly as we make significant investments in research and development and our sales and marketing organization, and expand our operations and infrastructure both domestically and internationally. In addition, in connection with operating as a public company, we will incur additional significant legal, accounting and other expenses that we did not incur as a private company. If our revenues do not increase to offset these increases in our operating expenses, we may not be profitable in future periods.

Our historical revenue growth should not be considered indicative of our future performance. You should not rely on our revenue growth, gross margins or operating results for any prior quarterly or annual periods as an indication of our future operating performance. If we are unable to maintain adequate revenue growth, our results of operations could suffer and our stock price could decline.

If we are unable to manage our future growth, we may not be able to execute our business plan and our operating results could suffer.

Our business has grown rapidly. Our future operating results depend to a large extent on our ability to successfully manage any expansion and growth, including the challenges of managing a company with headquarters in the United States and a large percentage of our employees and consultants in Malaysia, Romania

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and Russia. To manage our growth successfully and handle the responsibilities of being a public company, we believe we must, among other things, effectively:

• enhance our information technology systems for enterprise resource planning and design engineering by adapting and expanding our capabilities, and properly training new hires as to their use;

• effectively recruit, hire, train and manage additional qualified engineers for our research and development activities, particularly in our foreign offices and especially for the positions of semiconductor design and systems and applications engineering;

• build out our internal infrastructure and implement and improve our administrative, financial, management and operational systems, procedures and controls to scale with the business;

• add additional sales, business development, finance and accounting personnel and retain such personnel;

• protect and further develop our strategic assets, including our intellectual property rights; and

• make business decisions in light of the scrutiny associated with operating as a public company.

We may not be able to manage our future growth in an efficient or timely manner, or at all. In particular, any failure to successfully implement systems enhancements and improvements will likely have a negative impact on our ability to manage our expected growth, as well as our ability to ensure uninterrupted operation of key business systems and comply with the rules and regulations that are applicable to public reporting companies. If we are unable to manage our growth effectively, we may not be able to take advantage of market opportunities or develop new solutions, and we may fail to satisfy customer product or support requirements, maintain the quality of our solutions, execute our business plan or respond to competitive pressures, which could negatively affect our brand, results of operations and overall business.

A significant portion of our operations are located outside of the United States, which subjects us to additional risks, including increased complexity and costs of managing international operations and geopolitical instability.

We have research and development design centers in Malaysia, Romania and Russia, and we expect to continue to conduct business with companies that are located outside the United States, particularly in Eastern Europe and Asia. Our customers based in the United States often use contract manufacturers based in Eastern Europe or Asia to manufacture their products, and these contract manufacturers typically purchase products directly from us. As a result of our international focus, we face numerous challenges and risks, including:

• increased complexity and costs of managing international operations, including design and manufacture of our products;

• more difficult collection of receivables and longer collection cycles;

• difficulties in enforcing contracts generally;

• geopolitical and economic instability and military conflicts;

• limited protection of our intellectual property and other assets;

• compliance with local laws and regulations and unanticipated changes in local laws and regulations, including tax laws and regulations;

• trade and foreign exchange restrictions and higher tariffs;

• timing and availability of import and export licenses and other governmental approvals, permits and licenses, including export classification requirements;

• foreign currency fluctuations and exchange losses relating to our international operating activities;

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• restrictions imposed by the U.S. government or foreign governments on our ability to do business with certain companies or in certain countries as a result of international political conflicts and the complexity of complying with those restrictions;

• transportation delays and other consequences of limited local infrastructure, and disruptions, such as large scale outages or interruptions of service from utilities or telecommunications providers;

• difficulties in staffing international operations;

• local business and cultural factors that differ from our normal standards and practices;

• differing employment practices and labor relations;

• heightened risk of terrorist acts;

• regional health issues, travel restrictions and natural disasters; and

• work stoppages.

We depend on our executive officers and other key employees and the loss of one or more of these employees or an inability to attract and retain highly skilled employees could adversely affect our business.

Our success depends largely upon the continued services of our executive officers and other key employees. From time to time, there may be changes in our executive management team, which could disrupt our business. We do not have employment agreements with our executive officers or other key personnel that require them to continue to work for us for any specified period and, therefore, they could terminate their employment with us at any time. The loss of one or more of our executive officers, especially our Chief Executive Officer, Chief Technology Officer, or other key employees could have an adverse effect on our business.

In addition, to execute our growth plan, we must attract and retain highly qualified personnel. Competition for these personnel in the San Francisco Bay Area, where our headquarters is located, and in other locations where we maintain offices, is intense, especially for engineers experienced in designing and developing semiconductor solutions. We have, from time to time experienced, and we expect to continue to experience, difficulty in hiring and retaining employees with appropriate qualifications. Many of the companies with which we compete for experienced personnel have greater resources than we have. If we hire employees from competitors or other companies, their former employers may attempt to assert that these employees or we have breached legal obligations, resulting in a diversion of our time and resources if we respond to them. In addition, job candidates and existing employees often consider the value of the equity awards they receive in connection with their employment. If the perceived value of our equity awards declines, it may adversely affect our ability to recruit and retain highly skilled employees. If we fail to attract new personnel or fail to retain and motivate our current personnel, our business and future growth prospects could be adversely affected.

We are an “emerging growth company,” and we cannot be certain whether the reduced reporting requirements applicable to emerging growth companies will make our shares of common stock less attractive to investors.

We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act (JOBS Act), enacted in April 2012. For as long as we continue to be an emerging growth company, we may take advantage of exemptions from various reporting requirements that are applicable to public companies that are not emerging growth companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (Sarbanes-Oxley Act), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, exemptions from the requirements of holding a nonbinding advisory vote on executive compensation, and stockholder approval of any golden parachute payments, which we do not currently have. We could be an emerging growth company for up to five years, although we will lose that status sooner if our annual revenues exceed $1 billion, if we issue more than $1 billion in non-convertible debt in a three year period, or if the market value of our shares of common stock

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held by non-affiliates exceeds $700 million (measured as of the last business day of our second fiscal quarter each year). We cannot predict if investors will find our shares of common stock less attractive because we may rely on these exemptions. If some investors find our shares of common stock less attractive as a result, there may be a less active trading market for our shares of common stock and our stock price may be more volatile.

Under the JOBS Act, emerging growth companies can also delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

Our management has limited public company experience and may not be able to effectively or efficiently manage or transition to a public company.

We have never operated as a public company and will incur significant legal, accounting and other expenses that we did not incur as a private company. The individuals who constitute our management team have limited experience managing a publicly traded company and limited experience complying with the increasingly complex and changing laws pertaining to public companies. Our management team and other personnel will need to devote a substantial amount of time to compliance, and we may not effectively or efficiently manage our transition into a public company.

We have in the past identified material weaknesses in our internal controls over financial reporting that, if not properly remediated, could result in material misstatements in our financial statements in future periods and impair our ability to comply with the accounting and reporting requirements applicable to public companies.

Our independent registered public accounting firm has not conducted an audit of our internal controls over financial reporting. However, in connection with the audit of our consolidated financial statements for 2012 to 2013, and the review of the nine month period ending September 30, 2014, we identified two material weaknesses in our internal control over financial reporting, as defined in the standards established by the Public Company Accounting Oversight Board of the United States. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. The identified material weaknesses related to (1) our lack of sufficient, qualified personnel in accounting and financial reporting functions with sufficient experience and expertise with respect to the application of U.S. GAAP and related financial reporting during the fiscal years 2012 and 2013, and (2) our controls over the preparation of the provision for income taxes, resulting principally from the allocation of certain costs from our U.S. parent to one of our foreign subsidiaries which resulted in an adjustment to our income tax provision for the nine months ended September 30, 2014. Please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Internal Control Over Financial Reporting” for information regarding our remediation efforts. Our management and independent registered public accounting firm did not and were not required to perform an evaluation of our internal control over financial reporting as of and for the years ended December 31, 2012, 2013 and 2014 in accordance with the provisions of the JOBS Act.

While we believe that we have put in place additional controls over our accounting close procedures, including adding additional staff, adding additional reviews and approvals over monthly provisions, including our income tax provision, our remediation efforts are still in process and have not yet been tested. Therefore, we cannot assure you that the material weaknesses in our internal control over financial reporting have been fully remediated as of March 31, 2015. In addition, we cannot be certain that any such measures we undertake will successfully remediate those two material weaknesses or that other material weaknesses and control deficiencies will not be discovered in the future. If our remediation efforts are not successful or other material weaknesses or control deficiencies occur in the future, we may be unable to report our financial results accurately or on a timely basis, which could cause our reported financial results to be materially misstated and result in the loss of investor confidence or delisting and cause the trading price of our common stock to decline. As a result of such failures,

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we could also become subject to investigations by the stock exchange on which our securities are listed, the SEC, or other regulatory authorities, and become subject to litigation from investors and stockholders, which could harm our reputation, financial condition or divert financial and management resources from our core business.

As a result of becoming a public company, we are subject to additional regulatory compliance requirements, including Section 404 of the Sarbanes-Oxley Act, and if we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud.

Rules and regulations such as the Sarbanes-Oxley Act have increased our legal and finance compliance costs and made some activities more time consuming and costly. For example, Section 404 of the Sarbanes-Oxley Act requires that our management report on, and our independent auditors attest to, the effectiveness of our internal control structure and procedures for financial reporting. Effective internal controls are necessary for us to provide reliable financial reports and effectively prevent fraud. Section 404 compliance may divert internal resources and will take a significant amount of time and effort to complete. We may not be able to successfully complete the procedures and certification and attestation requirements of Section 404 by the time we will be required to do so. However, our auditors will not be required to formally attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 until we are no longer an “emerging growth company” as defined in the JOBS Act if we take advantage of the JOBS Act exemptions available to us. In addition, these Sarbanes-Oxley Act requirements may be modified, supplemented or amended from time to time. Implementing these changes may take a significant amount of time and may require specific compliance training of our personnel. In the future, we may discover areas of our internal controls that need improvement. If our auditors or we discover a material weakness or significant deficiency, the disclosure of that fact, even if quickly remedied, could reduce the market’s confidence in our financial statements and harm our stock price. Any inability to provide reliable financial reports or prevent fraud would harm our business. We may not be able to effectively and timely implement necessary control changes and employee training to ensure continued compliance with the Sarbanes-Oxley Act and other regulatory and reporting requirements. If we fail to successfully complete the procedures and certification and attestation requirements of Section 404, or if in the future our Chief Executive Officer, Chief Financial Officer or independent registered public accounting firm determines that our internal controls over financial reporting are not effective as defined under Section 404, we could be subject to investigations or sanctions by the NASDAQ Stock Market (NASDAQ), the Securities and Exchange Commission (SEC) or other regulatory authorities. Furthermore, investor perceptions of our company may suffer, and this could cause a decline in the market price of our shares of common stock. We cannot assure you that we will be able to fully comply with the requirements of the Sarbanes-Oxley Act or that management or our auditors will conclude that our internal controls are effective in future periods. Irrespective of compliance with Section 404, any failure of our internal controls could have a material adverse effect on our stated results of operations and harm our reputation.

If we fail to hire additional finance personnel, strengthen our financial reporting systems and infrastructure, and improve our enterprise resource planning (ERP) system, we may not be able to timely and accurately report our financial results or comply with the requirements of being a public company, including compliance with the Sarbanes-Oxley Act and SEC reporting requirements.

We intend to hire additional accounting and finance personnel with system implementation experience and Sarbanes-Oxley Act compliance expertise. Any inability to recruit and retain such finance personnel would have an adverse impact on our ability to accurately and timely prepare our financial statements. We may be unable to locate and hire qualified professionals with requisite technical and public company experience when and as needed. In addition, new employees will require time and training to learn our business and operating processes and procedures. If our finance and accounting organization is unable for any reason to respond adequately to the increased demands that will result from being a public company, the quality and timeliness of our financial reporting may suffer, which could result in the identification of material weaknesses in our internal controls. Any consequences resulting from inaccuracies or delays in our reported financial statements could cause the trading price of our shares of common stock to decline and could harm our business, operating results and financial condition.

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If we fail to strengthen our financial reporting systems, infrastructure and internal control over financial reporting to meet the demands that will be placed upon us as a public company, including the requirements of the Sarbanes-Oxley Act, we may be unable to report our financial results timely and accurately and prevent fraud. We expect to incur significant expense and devote substantial management effort toward ensuring compliance with Section 404.

We have to improve our current ERP system and in the future may need to implement a new ERP system. This will require significant investment of capital and human resources, the re-engineering of many processes of our business and the attention of many employees who would otherwise be focused on other aspects of our business. Any disruptions, delays or deficiencies in the design and implementation of the improvements to our current ERP system or a new ERP system, if needed, could result in potentially much higher costs than we had anticipated and could adversely affect our ability to develop and launch solutions, fulfill contractual obligations, file reports with the SEC in a timely manner, otherwise operate our business or otherwise impact our controls environment. Any of these consequences could have an adverse effect on our results of operations and financial condition.

Our failure to adequately protect our intellectual property rights could impair our ability to compete effectively or defend ourselves from litigation, which could harm our business, financial condition and results of operations.

Our success depends, in part, on our ability to protect our intellectual property. We rely primarily on patent, copyright, trademark and trade secret laws, as well as confidentiality and non-disclosure agreements and other contractual protections, to protect our proprietary technologies and know-how, all of which offer only limited protection. The steps we have taken to protect our intellectual property rights may not be adequate to prevent misappropriation of our proprietary information or infringement of our intellectual property rights, and our ability to prevent such misappropriation or infringement is uncertain, particularly in countries outside of the United States. As of March 31, 2015, we had 35 issued and allowed patents in the United States, 16 issued international patents and four pending and provisional patent applications in the United States. Even if the pending patent applications are granted, the rights granted to us may not be meaningful or provide us with any commercial advantage. For example, these patents could be opposed, contested, circumvented, designed around by our competitors or be declared invalid or unenforceable in judicial or administrative proceedings. The failure of our patents to adequately protect our technology might make it easier for our competitors to offer similar products or technologies. Our foreign patent protection is generally not as comprehensive as our U.S. patent protection and may not protect our intellectual property in some countries where our products are sold or may be sold in the future. Many U.S.-based companies have encountered substantial intellectual property infringement in foreign countries, including countries where we sell products. Even if foreign patents are granted, effective enforcement in foreign countries may not be available. If such an impermissible use of our intellectual property or trade secrets were to occur, our ability to sell our solutions at competitive prices may be adversely affected and our business, financial condition, results of operations and cash flows could be adversely affected.

The legal standards relating to the validity, enforceability and scope of protection of intellectual property rights are uncertain and evolving. We cannot assure you that others will not develop or patent similar or superior technologies or solutions, or that our patents, trademarks and other intellectual property will not be challenged, invalidated or circumvented by others.

Unauthorized copying or other misappropriation of our proprietary technologies could enable third parties to benefit from our technologies without paying us for doing so, which could harm our business. Monitoring unauthorized use of our intellectual property is difficult and costly. Although we are not aware of any unauthorized use of our intellectual property in the past, it is possible that unauthorized use of our intellectual property may have occurred or may occur without our knowledge. We cannot assure you that the steps we have taken will prevent unauthorized use of our intellectual property. Our failure to effectively protect our intellectual property could reduce the value of our technology in licensing arrangements or in cross-licensing negotiations.

We may in the future need to initiate infringement claims or litigation in order to try to protect our intellectual property rights. Litigation, whether we are a plaintiff or a defendant, can be expensive, time-consuming and may

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divert the efforts of our technical staff and management, which could harm our business, whether or not such litigation results in a determination favorable to us. Litigation also puts our patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing. Additionally, any enforcement of our patents or other intellectual property may provoke third parties to assert counterclaims against us. If we are unable to protect our proprietary rights or if third parties independently develop or gain access to our or similar technologies, our business, revenue, reputation and competitive position could be harmed.

Third parties’ assertions of infringement of their intellectual property rights could result in our having to incur significant costs and cause our operating results to suffer.

The semiconductor industry is characterized by vigorous protection and pursuit of intellectual property rights and positions, which has resulted in protracted and expensive litigation for many companies. We expect that in the future, particularly as a public company with an increased profile and visibility, we may receive communications from others alleging our infringement of patents, trade secrets or other intellectual property rights. Lawsuits resulting from such allegations could subject us to significant liability for damages and invalidate our proprietary rights. Any potential intellectual property litigation also could force us to do one or more of the following:

• stop selling solutions or using technology that contain the allegedly infringing intellectual property;

• lose the opportunity to license our technology to others or to collect royalty payments based upon successful protection and assertion of our intellectual property against others;

• incur significant legal expenses;

• pay substantial damages to the party whose intellectual property rights we may be found to be infringing;

• redesign those products that contain the allegedly infringing intellectual property; or

• attempt to obtain a license to the relevant intellectual property from third parties, which may not be available on reasonable terms or at all.

Any significant impairment of our intellectual property rights from any litigation we face could harm our business and our ability to compete.

Any potential dispute involving our patents or other intellectual property could affect our customers, which could trigger our indemnification obligations to them and result in substantial expense to us.

In any potential dispute involving our patents or the intellectual property of others, our customers could also become the target of litigation. Our custom IC solutions are included in our customers’ products. Our agreements with customers and other third parties generally include indemnification or other provisions under which we agree to indemnify or otherwise be liable to them for losses suffered or incurred as a result of claims of intellectual property infringement, damages caused by us to property or persons, or other liabilities relating to or arising from our solutions, which include intellectual property from our customers’ designs. For example, in November 2014, we received a letter from counsel to Seagate notifying us that Seagate had been sued for patent infringement with respect to a Seagate product incorporating an eASIC product and asserting Seagate’s right to indemnification and defense costs pursuant to its agreement with us. Seagate subsequently agreed to limit our indemnification obligation for this specific matter to no more than $200,000, but large indemnity payments or damage claims from contractual breach in any such future matters could harm our business, operating results, and financial condition. From time to time, customers require us to indemnify or otherwise be liable to them for breach of confidentiality or failure to implement adequate security measures with respect to their intellectual property and trade secrets. Although we normally contractually limit our liability with respect to such obligations, we may still incur substantial liability related to them. Any litigation against our customers could trigger technical support and indemnification obligations under some of our agreements, which could result in substantial expense to us.

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In addition, other customers or end customers with whom we do not have formal agreements requiring us to indemnify them may ask us to indemnify them if a claim is made as a condition to awarding future design wins to us. Because most of our OEM customers are larger than we are and have greater resources than we do, they may be more likely to be the target of an infringement claim by third parties than we would be, which could increase our chances of becoming involved in a future lawsuit. If any such claims were to succeed, we might be forced to pay damages on behalf of our OEM customers that could increase our expenses, disrupt our ability to sell our solutions and reduce our revenues. Any dispute with a customer with respect to such obligations could have adverse effects on our relationship with that customer and other current and prospective customers, reduce demand for our solutions, and harm our business and results of operations. In addition to the time and expense required for us to supply support or indemnification to our customers, any such litigation could severely disrupt or shut down the business of our customers, which in turn could hurt our relations with our customers and cause the sale of our products to decrease.

We may be subject to warranty and product liability claims and to product recalls.

From time to time, we may be subject to warranty claims that may require us to make significant expenditures to replace our solutions, refund payments, defend these claims or pay damage awards. In the future, we may also be subject to product liability claims resulting from failure of our solutions. In the event of a warranty claim, we may also incur costs if we compensate the affected customer. Our product liability insurance is limited in amount and subject to significant deductibles. There is no guarantee that our insurance will be available or adequate to protect against all claims. We also may incur costs and expenses relating to a recall of one of our customers’ products containing one of our devices. The process of identifying a recalled product in consumer devices that have been widely distributed may be lengthy and require significant resources, and we may incur significant replacement costs, refund costs, contract damage claims from our customers and reputational harm. Costs or payments made in connection with warranty and product liability claims and product recalls could harm our financial condition and results of operations.

A breach of our security systems may damage our reputation and adversely affect our business.

Our security systems are designed to protect our customers’, suppliers’ and employees’ confidential information, as well as maintain the physical security of our facilities. We also rely on a number of third-party “cloud-based” service providers of corporate infrastructure services relating to, among other things, human resources, electronic communication services and some finance functions, and we are, of necessity, dependent on the security systems of these providers. Any security breaches or other unauthorized access by third parties to the systems of our cloud-based service providers or the existence of computer viruses in their data or software could expose us to a risk of information loss and misappropriation of confidential information. Accidental or willful security breaches or other unauthorized access by third parties to our information systems or facilities, or the existence of computer viruses in our data or software, could expose us to a risk of information loss and misappropriation of proprietary and confidential information. Any theft or misuse of this information could result in, among other things, unfavorable publicity, damage to our reputation, difficulty in marketing our products, allegations by our customers that we have not performed our contractual obligations, litigation by affected parties and possible financial obligations for liabilities and damages related to the theft or misuse of this information, any of which could have a material adverse effect on our business, financial condition, our reputation, and our relationships with our customers and partners. Since the techniques used to obtain unauthorized access or to sabotage systems change frequently and are often not recognized until launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures.

We may make acquisitions in the future that could disrupt our business, cause dilution to our stockholders, reduce our financial resources and harm our business.

In the future, we may acquire other businesses, products or technologies. We have not made any acquisitions to date and do not have any agreements or commitments for any specific acquisition at this time. Our

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ability to make and successfully integrate acquisitions is unproven. If we complete acquisitions, we may not achieve the combined revenues, cost synergies or other benefits from the acquisition that we anticipate, strengthen our competitive position or achieve our other goals in a timely manner, or at all, and these acquisitions may be viewed negatively by our customers, financial markets or investors. In addition, any acquisitions we make may not lead to the target revenues or cost synergies expected and could lead to difficulties in integrating personnel, technologies and operations from the acquired businesses and in retaining and motivating key personnel from these businesses. Acquisitions may disrupt our ongoing operations, divert management from their primary responsibilities, subject us to additional liabilities, increase our expenses and adversely impact our business, results of operations, financial condition and cash flows. Acquisitions may also reduce our cash available for operations and other uses, and could also result in an increase in amortization expense related to identifiable assets acquired, potentially dilutive issuances of equity securities or the incurrence of debt, any of which could harm our business.

We are subject to the cyclical nature of the semiconductor industry.

The semiconductor industry is highly cyclical and is characterized by constant and rapid technological change, rapid product obsolescence, price erosion, evolving standards, short product life cycles and wide fluctuations in product supply and demand. The industry experienced a significant downturn during the most recent global recession. These downturns have been characterized by diminished product demand, production overcapacity, high inventory levels and accelerated erosion of average selling prices. Any future downturns in the semiconductor industry could harm our business and operating results. Furthermore, any significant upturn in the semiconductor industry could result in increased competition for access to third-party foundry and assembly capacity. We are dependent on the availability of this capacity to manufacture and assemble our products. None of our foundries has provided assurances that adequate capacity will be available to us in the future.

Deterioration of the financial conditions of our customers could adversely affect our operating results.

The deterioration of the financial condition of our customers could adversely impact our collection of accounts receivable. We regularly review the collectability and creditworthiness of our customers to determine an appropriate allowance for doubtful accounts. Based on our review of our customers, many of which are very large OEMs, we currently have no reserve for doubtful accounts. If our doubtful accounts, however, were to exceed our current or future allowance for doubtful accounts, our quarterly and long-term results of operations would be negatively impacted.

In preparing our financial statements, we make good faith estimates and judgments that may change or turn out to be erroneous, which could adversely affect our operating results for the periods in which we revise our estimates or judgments.

In preparing our financial statements in conformity with U.S. generally accepted accounting principles (GAAP), we must make estimates and judgments in applying our most critical accounting policies. Those estimates and judgments have a significant impact on the results we report in our consolidated financial statements. The most difficult estimates and subjective judgments that we make relate to revenue recognition, inventories, long-lived assets including manufacturing tooling, deferred tax assets and stock-based compensation. We base our estimates on historical experience, input from outside experts and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We also have other key accounting policies that are not as subjective, and therefore, their application would not require us to make estimates or judgments that are as difficult, but which nevertheless could significantly affect our financial reporting. Actual results may differ materially from these estimates. If these estimates, judgments or their related assumptions change, our operating results for the periods in which we revise our estimates, judgments or assumptions could be adversely and perhaps materially affected.

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Changes to financial accounting standards may affect our results of operations and could cause us to change our business practices.

We prepare our consolidated financial statements to conform to GAAP. These accounting principles are subject to interpretation by the American Institute of Certified Public Accountants, the SEC and various bodies formed to interpret and create accounting rules and regulations. Changes in accounting rules can have a significant effect on our reported financial results and may affect our reporting of transactions completed before a change is announced. Changes to those rules or the questioning of current practices may adversely affect our financial results or the way we conduct our business.

Changes in effective tax rates or adverse outcomes resulting from any future audit of our income tax returns, or a delay or failure to implement planned changes to how we transact business internationally could adversely affect our results.

A change in our effective tax rate could have a significant adverse impact on our business, and an adverse outcome resulting from any future audit of our income or other tax returns could adversely affect our results. We are subject to income tax in the United States and numerous foreign jurisdictions. Significant judgment is required in evaluating and estimating our provision and accruals for these taxes. During the ordinary course of business, there are many transactions for which the ultimate tax determination is uncertain. Our effective tax rates could be adversely affected by earnings being lower than anticipated in countries where we have lower statutory rates and higher than anticipated in countries where we have higher statutory rates, by losses incurred in jurisdictions for which we are not able to realize the related tax benefit, by changes in foreign currency exchange rates, by entry into new business and geographies and changes to our existing businesses, by acquisitions (including integrations) and investments, and by changes in the valuation of our deferred tax assets and liabilities. In addition, our effective tax rate could be impacted by changes in the relevant tax, accounting and other laws, regulations, administrative practices, principles, and interpretations, including fundamental changes to the tax laws applicable to corporate multinationals. The United States, many countries in the European Union, and a number of other countries are actively considering changes in this regard. We may be subject to audits in various jurisdictions, and such jurisdictions may assess additional income tax liabilities against us. Although we believe our tax estimates are reasonable, the final outcome of any such future tax audits, if any, and any related litigation could be materially different from our historical income tax provisions and accruals. Developments in an audit, litigation, or the relevant laws, regulations, administrative practices, principles, and interpretations could have a material effect on our results of operations or cash flows in the period or periods for which that development occurs, as well as for prior and subsequent periods.

In addition, we are currently in the process of implementing changes to how we transact business internationally to align our operations with that of our customers and suppliers, most of whom conduct business internationally. Accordingly, we are in process of transitioning certain business functions and activities to our foreign entities, which will result in our revenue and profits from our international customers being recognized by our international entities. Such entities have lower effective tax rates than the United States and, accordingly, we anticipate the change will lower our overall consolidated effective tax rate. While we believe we will implement these changes consistent with the estimates used in the determination of our 2015 effective tax rate, we can provide no assurance that the changes will be completed according to our planned timing and that we will realize our estimated effective tax rate. Nor can we provide any assurance that even if our international changes are completed on time, that various tax jurisdictions will recognize the validity of the corresponding changes to our tax structure, and may challenge our tax structure by audit or other means. If our international business changes are not completed in the time we expect, or if the corresponding changes to our tax structure are found to be invalid by audit or other means, our effective tax rate will be higher than we expect, and our profitability after tax will be negatively impacted.

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Our loan agreements contain certain restrictive and financial covenants that may limit our operating flexibility.

Our Amended and Restated Venture Loan and Security Agreement with Horizon Technology Finance Corporation, Horizon Funding Trust 2013-1, DBD Credit Funding LLC and Fortress Credit Opportunities I, LP, dated September 12, 2014, and our Loan and Security Agreement with Silicon Valley Bank, as amended, dated as of September 29, 2010, both contain certain restrictive covenants that either limit our ability to, or require a mandatory prepayment in the event we, incur additional indebtedness and liens, merge with other companies or consummate certain changes of control, acquire other companies, make certain investments, pay dividends, transfer or dispose of assets, amend certain material agreements or enter into various specified transactions. Our loan agreements also contain certain financial covenants, including minimum revenues and maximum cash balance amounts to be held in foreign deposit accounts, and financial reporting requirements. Our obligations under the loan agreements are secured by all of our property, other than our intellectual property, with limited exceptions. We may not be able to generate sufficient cash flow or sales to meet the financial covenants or pay the principal and interest under our outstanding debt obligations. Furthermore, our future working capital, borrowings, or equity financing could be unavailable to repay or refinance the amounts outstanding under our current debt obligations. In the event of a liquidation, our lender would be repaid all outstanding principal and interest prior to distribution of assets to unsecured creditors, and the holders of our common stock would receive a portion of any liquidation proceeds only if all of our creditors, including our lender, were first repaid in full.

We cannot predict our future capital needs, and we may not be able to obtain additional financing to fund our operations.

We may need to raise additional funds in the future. Any required additional financing may not be available on terms acceptable to us, or at all. If we raise additional funds by issuing equity securities or convertible debt, investors may experience significant dilution of their ownership interest, and the newly-issued securities may have rights senior to those of the holders of our common stock. If we raise additional funds by obtaining loans from third parties, the terms of those financing arrangements may include negative covenants or other restrictions on our business that could impair our operational flexibility and would also require us to incur interest expense. If additional financing is not available when required or is not available on acceptable terms, we may have to scale back our operations or limit our production activities, and we may not be able to expand our business, develop or enhance our solutions, take advantage of business opportunities or respond to competitive pressures, which could result in lower revenues and reduce the competitiveness of our products.

Fluctuations in exchange rates between and among the currencies of the countries in which we do business could adversely affect our results of operations.

Our sales have been historically denominated in U.S. dollars. An increase in the value of the U.S. dollar relative to the currencies of the countries in which our customers operate could impair the ability of our customers to cost-effectively purchase or integrate our products into their devices, which may materially affect the demand for our solutions and cause these customers to reduce their orders, which in turn would adversely affect our revenues and business. We may in the future, if we increase operations in other currencies, experience foreign exchange gains or losses due to the volatility of other currencies compared to the U.S. dollar. Certain of our employees are located in Europe and Asia, principally Romania and Malaysia. Accordingly, a portion of our payroll as well as certain other operating expenses are paid in currencies other than the U.S. dollar. Our results of operations are denominated in U.S. dollars, and the difference in exchange rates in one period compared to another may directly impact period-to-period comparisons of our results of operations. Furthermore, currency exchange rates have been especially volatile in the recent past, and these currency fluctuations may make it difficult for us to predict our results of operations.

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Failure to comply with the laws associated with our activities outside of the United States could subject us to penalties and other adverse consequences.

We face significant risks if we fail to comply with anti-corruption laws and anti-bribery laws, including, without limitation, the U.S. Foreign Corrupt Practices Act of 1977, as amended (FCPA), the U.S. Travel Act and the UK Bribery Act 2010, that prohibit improper payments or offers of payment to foreign governments and political parties by us for the purpose of obtaining or retaining business. In many foreign countries, particularly in countries with developing economies, it may be a local custom that businesses operating in such countries engage in business practices that are prohibited by the FCPA or other applicable laws and regulations. We are in the early stages of implementing our FCPA compliance program and cannot assure you that all of our employees and agents, as well as those companies to which we outsource certain of our business operations, will not take actions in violation of our policies and applicable law, for which we may be ultimately held responsible. Any violation of these laws could result in severe criminal or civil sanctions and, in the case of the FCPA, suspension or debarment from U.S. government contracting, which could have an adverse effect on our reputation, business, financial condition and results of operations.

We, our customers and third-party contractors are subject to increasingly complex environmental regulations, and compliance with these regulations may delay or interrupt our operations and adversely affect our business.

We face increasing complexity in our procurement, design, and research and development operations as a result of requirements relating to the materials composition of our products. Failure to comply with these and similar laws and regulations could subject us to fines, penalties, civil or criminal sanctions, contract damage claims, or take-back of non-compliant products, which could harm our business, reputation and results of operations. The passage of similar requirements in additional jurisdictions or the tightening of these standards in jurisdictions where our products are already subject to such requirements could cause us to incur significant expenditures to make our products compliant with new requirements, or could limit the markets into which we may sell our products.

Some of our operations, as well as the operations of our contract manufacturers and foundries and other suppliers, are also regulated under various other federal, state, local, foreign and international environmental laws and requirements, including those governing, among other matters, the management, disposal, handling, use, labeling of, and exposure to hazardous substances, and the discharge of pollutants into the air and water. Liability under environmental laws can be joint and several and without regard to comparative fault. We cannot assure you that violations of these laws will not occur in the future, as a result of human error, accident, equipment failure or other causes. Environmental laws and regulations have increasingly become more stringent over time. We expect that our products and operations will be affected by new environmental requirements on an ongoing basis, which will likely result in additional costs, which could adversely affect our business.

Our failure to comply with present and future environmental, health and safety laws could cause us to incur substantial costs, result in civil or criminal fines and penalties or result in decreased revenues, any of which could adversely affect our results of operations. Failure by our foundry vendors or other suppliers to comply with applicable environmental laws and requirements could cause disruptions and delays in our product shipments, which could adversely affect our relations with our customers and adversely affect our business and results of operations.

Regulations related to “conflict minerals” may force us to incur additional expenses, may make our supply chain more complex and may result in damage to our reputation with customers.

Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act), the SEC has adopted requirements for companies that use certain minerals and metals, known as conflict minerals, in their products, whether or not these products are manufactured by third parties. These requirements require companies to diligence, disclose and report whether or not such minerals originate from the Democratic Republic of Congo and adjoining countries. The implementation of these new requirements could adversely

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affect the sourcing, availability and pricing of minerals used in the manufacture of semiconductor devices, including our products. In addition, we will continue to incur additional costs to comply with the disclosure requirements, including costs related to determining the source of any of the relevant minerals and metals used in our products. Since our supply chain is complex, we may not be able to sufficiently verify the origins for these minerals and metals used in our products through the due diligence procedures that we implement, which may harm our reputation. In such event, we may also face difficulties in satisfying customers that require that all of the components of our products are certified as conflict mineral free.

Catastrophic events may disrupt our business.

Our corporate headquarters are located in Santa Clara, California. The west coast of the United States contains active earthquake zones. In the event of a major earthquake, hurricane, or catastrophic event such as fire, power loss, telecommunications failure, cyber-attack, war, terrorist attack or disease outbreak, including Ebola, we may be unable to continue our operations and may endure system interruptions, reputational harm, delays in our application development, lengthy interruptions in our platform, breaches of data security, or loss of critical data, any of which could have an adverse effect on our future results of operations.

Risks Related to Ownership of Our Common Stock and this Offering

There has been no prior market for our common stock, and an active market may not develop or be sustained and investors may not be able to resell their shares at or above the initial public offering price.

There has been no public market for our common stock prior to this offering. The initial public offering price for our common stock will be determined through negotiations between the underwriters and us and may vary from the market price of our common stock following this offering. If you purchase shares of our common stock in this offering, you may not be able to resell those shares at or above the initial public offering price, if at all. An active or liquid market in our common stock may not develop upon the closing of this offering or, if it does develop, it may not be sustainable.

Our stock price may be volatile or may decline, regardless of our operating performance, resulting in substantial losses for investors purchasing shares in this offering.

The trading price and volume of our common stock is likely to be volatile and could fluctuate significantly regardless of our operating performance, in response to numerous factors, many of which are beyond our control, including those discussed elsewhere in this “Risk Factors” section, as well as:

• actual or anticipated fluctuations in our results of operations;

• the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;

• failure of securities analysts to initiate or maintain coverage of our company, changes in financial estimates by any securities analysts who follow our company, or our failure to meet these estimates or the expectations of investors;

• ratings changes by any securities analysts who follow our company;

• announcements by us or our competitors of significant technical innovations, acquisitions, strategic partnerships, joint ventures or capital commitments;

• changes in operating performance and stock market valuations of other technology companies generally, or those in our industry in particular;

• price and volume fluctuations in the overall stock market from time to time, including as a result of trends in the economy as a whole;

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• actual or anticipated developments in our business or our competitors’ businesses or the competitive landscape generally;

• new laws or regulations or new interpretations of existing laws, or regulations applicable to our business;

• any major change in our management;

• lawsuits threatened or filed against us; and

• other events or factors, including those resulting from war, incidents of terrorism or responses to these events.

In addition, the market for technology stocks and the stock markets in general have experienced extreme price and volume fluctuations. Stock prices of many technology companies have fluctuated in a manner unrelated or disproportionate to the operating performance of those companies. In the past, stockholders have instituted securities class action litigation following periods of market volatility. If we were to become involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our business and adversely affect our business, results of operations, financial condition and cash flows.

Substantial future sales of shares of our common stock could cause the market price of our common stock to decline.

The market price of our common stock could decline as a result of substantial sales of our common stock, particularly sales by our directors, executive officers and significant stockholders, a large number of shares of our common stock becoming available for sale or the perception in the market that holders of a large number of shares intend to sell their shares. Upon the completion of this offering, there will be approximately             shares of our common stock outstanding, assuming no exercise of the underwriters’ over-allotment option. All of the shares of common stock sold in this offering will be freely transferable without restriction or additional registration under the Securities Act of 1933, as amended (Securities Act). Our directors, officers and other existing security holders will be subject to lock-up agreements described under the caption “Shares Eligible for Future Sale.” Subject to the restrictions under Rule 144 under the Securities Act, approximately              shares of common stock will be eligible for resale 180 days after the date of this prospectus following the expiration of these lockup agreements, subject to extension in certain circumstances. In addition, at any time and without public notice, Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc., as representatives of the underwriters, may in their discretion also release shares subject to the lock-up prior to the expiration of the lock-up period; provided, however, that if the release is granted for one of our officers or directors, (i) Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc., as representatives of the underwriters, agree that at least three business days before the effective date of the release or waiver, Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc., as representatives, will notify us of the impending release or waiver, and (ii) we are obligated to announce the impending release or waiver by press release through a major news service at least two business days before the effective date of the release or waiver. As resale restrictions end, the market price of our common stock could decline if the holders of those shares sell them or are perceived by the market as intending to sell them.

After this offering, the holders of an aggregate of                      shares of our common stock as of March 31, 2015 will have rights, subject to certain conditions, to require us to file registration statements covering their shares or to include their shares in registration statements that we may file for ourselves or our stockholders. We also intend to register shares of common stock that we may issue under our employee equity incentive plans. Once we register these shares, they will be able to be sold freely in the public market upon issuance, subject to existing market stand-off or lock-up agreements.

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Our directors, officers, and principal stockholders beneficially own a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval.

Upon the closing of this offering, our directors, officers, greater than 5% stockholders and their respective affiliates will beneficially own in the aggregate approximately     % of our outstanding stock. Therefore, after this offering these stockholders will continue to have the ability to influence us through this ownership position. These stockholders may be able to determine all matters requiring stockholder approval. For example, these stockholders will be able to control elections of directors, amendments of our organizational documents, or approval of any merger, sale of assets or other major corporate transaction. This may prevent or discourage unsolicited acquisition proposals or offers for our common stock that you may feel are in your best interest as one of our stockholders.

If securities analysts or industry analysts downgrade our common stock, publish negative research or reports or fail to publish reports about our business, our stock price and trading volume could decline.

The trading market for our common stock will be influenced by the research and reports that industry or securities analysts publish about us, our business and our market. If one or more analysts adversely changes their recommendation regarding our stock or changes their recommendation about our competitors’ stock, our stock price would likely decline. If one or more analysts cease coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets which in turn could cause our stock price or trading volume to decline.

Our actual operating results may not meet our guidance and investor expectations, which would likely cause our stock price to decline.

From time to time, we may release guidance in our earnings releases, earnings conference calls or otherwise, regarding our future performance that represent our management’s estimates as of the date of release. If given, this guidance, which will include forward-looking statements, will be based on projections prepared by our management. Projections are based upon a number of assumptions and estimates that, while presented with numerical specificity, are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. The principal reason that we expect to release guidance is to provide a basis for our management to discuss our business outlook with analysts and investors. With or without our guidance, analysts and other investors may publish expectations regarding our business, financial performance and results of operations. We do not accept any responsibility for any projections or reports published by any such third parties.

Guidance is necessarily speculative in nature, and it can be expected that some or all of the assumptions of the guidance furnished by us will not materialize or will vary significantly from actual results. If our actual performance does not meet or exceed our guidance or investor expectations, the trading price of our common stock is likely to decline.

Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of our company more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our common stock.

Provisions in our amended and restated certificate of incorporation and amended and restated bylaws to be effective in connection with this offering, may have the effect of delaying or preventing a change of control or changes in our management. Our amended and restated certificate of incorporation and amended and restated bylaws include provisions that:

• authorize our board of directors to issue, without further action by the stockholders, shares of undesignated preferred stock with terms, rights, and preferences determined by our board of directors that may be senior to our common stock;

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• require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written consent;

• specify that special meetings of our stockholders can be called only by our board of directors, the Chairman of our board of directors, or our Chief Executive Officer;

• establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our board of directors;

• establish that our board of directors is divided into three classes, with each class serving three-year staggered terms;

• prohibit cumulative voting in the election of directors;

• provide that our directors may be removed only for cause;

• provide that vacancies on our board of directors may be filled only by a majority of directors then in office, even if less than a quorum; and

• require the approval of our board of directors or the holders of at least seventy-five percent (75%) of our outstanding shares of capital stock to amend our bylaws and certain provisions of our certificate of incorporation.

These provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our board of directors, which is responsible for appointing the members of our management. In addition, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, which generally prohibits a Delaware corporation from engaging in any of a broad range of business combinations with any “interested” stockholder for a period of three years following the date on which the stockholder became an “interested” stockholder. Any delay or prevention of a change of control transaction or changes in our management could cause the market price of our common stock to decline.

Our charter documents designate the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain what they believe to be a favorable judicial forum for disputes with us or our directors, officers, or other employees.

Our certificate of incorporation and bylaws, as amended and restated in connection with this offering, provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for (A) any derivative action or proceeding brought on our behalf, (B) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders, (C) any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or our bylaws or (D) any action asserting a claim against us governed by the internal affairs doctrine. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed to have notice of and consented to the provisions of our certificate of incorporation described above. This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers, and other employees. Alternatively, if a court were to find these provisions of our certificate of incorporation inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business, financial condition or results of operations and result in a diversion of the time and resources of our management and board of directors.

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We may invest or spend the proceeds of this offering in ways with which you may not agree or in ways which may not yield a return.

Our management will have considerable discretion in the application of the net proceeds we receive in this offering, and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately. The net proceeds we receive may be used for corporate purposes that do not increase the value of our business, which could cause our stock price to decline.

We do not intend to pay dividends on our common stock so any returns will be limited to changes in the value of our common stock.

We have never declared or paid any cash dividends on our common stock. We currently anticipate that we will retain future earnings for the development, operation, and expansion of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. In addition, our ability to pay cash dividends on our common stock is restricted by the terms of our debt financing arrangements and may be prohibited or limited by the terms of any future debt financing arrangements. Any return to stockholders will therefore be limited to the increase, if any, in our stock price, which may never occur.

As a new investor, you will experience immediate and substantial dilution in the book value of the shares that you purchase in this offering.

The initial public offering price is substantially higher than the pro forma net tangible book value per share of our common stock immediately following this offering based on the total value of our tangible assets less our total liabilities. Therefore, if you purchase shares of our common stock in this offering, at the assumed initial public offering price of $         per share (the midpoint of the price range reflected on the cover page of this prospectus), you will experience immediate dilution of $         per share, the difference between the price per share you pay for our common stock and our pro forma net tangible book value per share as of March 31, 2015, after giving effect to the issuance by us of             shares of our common stock in this offering. See “Dilution.” To the extent outstanding options or warrants to purchase our common stock are exercised, investors purchasing our common stock in this offering will experience further dilution.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus, including the sections entitled “Prospectus Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business,” contains forward-looking statements. We may, in some cases, use words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would” or the negative of those terms, and similar expressions that convey uncertainty of future events or outcomes to identify these forward-looking statements. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. Forward-looking statements in this prospectus include, but are not limited to, statements about:

• our ability to retain and expand our customer relationships and to achieve design wins;

• the success, cost and timing of new product designs;

• our ability to address market and customer demands and to timely develop new or enhanced solutions to meet those demands;

• anticipated trends, challenges and growth in our business and the markets in which we operate, including pricing expectations;

• our expectations regarding our revenue, gross margins and expenses;

• the size and growth potential of the markets for our solutions, and our ability to serve those markets;

• our expectations regarding competition in our existing and new markets;

• regulatory developments in the United States and foreign countries;

• the performance of our third-party suppliers and manufacturers;

• our and our customers’ ability to respond successfully to technological or industry developments;

• our ability to attract collaborators and strategic partnerships;

• our ability to attract and retain key management personnel;

• the average selling prices of semiconductor solutions;

• the accuracy of our estimates regarding capital requirements and needs for additional financing;

• the industry standards to which our solutions conform;

• our expectations regarding the period during which we qualify as an emerging growth company under the JOBS Act;

• our use of the proceeds from this offering; and

• our expectations regarding our ability to obtain and maintain intellectual property protection for our technology.

These forward-looking statements reflect our management’s beliefs and views with respect to future events and are based on estimates and assumptions as of the date of this prospectus and are subject to risks and uncertainties. We discuss many of these risks in greater detail under “Risk Factors.” Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. Given these uncertainties, you should not place undue reliance on these forward-looking statements.

You should read this prospectus and the documents that we reference in this prospectus and have filed as exhibits to the registration statement, of which this prospectus is a part, completely and with the understanding

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that our actual future results may be materially different from what we expect. We qualify all of the forward-looking statements in this prospectus by these cautionary statements. Except as required by law, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. We undertake no obligation to update publicly any forward-looking statements for any reason after the date of this prospectus to conform these statements to actual results or to changes in our expectations, except as required by law.

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INDUSTRY AND MARKET DATA

This prospectus contains statistical data, estimates, and forecasts that are based on independent industry publications, such as those published by Gartner, Inc., or other publicly available information, as well as other information based on our internal sources. Although we believe that the third-party sources referred to in this prospectus are reliable, estimates as they relate to projections involve numerous assumptions, are subject to risks and uncertainties and are subject to change based on various factors, including those discussed under the section titled “Risk Factors” and elsewhere in this prospectus. These and other factors could cause results to differ materially from those expressed in the estimates made by the independent parties and by us.

Certain information in the text of this prospectus is contained in Gartner Forecast: ASIC/ASSP, FPGA/PLD and SLI/SoC Applications, Worldwide, 2012-2018, 4Q14 Update (December 30, 2014) (Summation of consumption values of each relevant segment).

The Gartner Report described herein represents data, research opinion, or viewpoints published as part of a syndicated subscription service by Gartner and are not representations of fact. The Gartner Report speaks as of its original publication date (and not as of the date of this prospectus) and the opinions expressed in the Gartner Report are subject to change without notice.

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GLOSSARY

The following capitalized phrases and their acronyms are used throughout this prospectus and have the meanings set forth below:

Application Specific Integrated Circuit (ASIC): a custom integrated circuit that is designed and manufactured for one customer and can only be used in one specific application.

Application Specific Standard Product (ASSP): an integrated circuit that is designed for a specific application but can be used by multiple customers.

Base Array: an uncommitted eASIC IC that has a specific amount of logic, memory and I/O capacity. The base arrays are versatile and can be used for multiple applications. The final customization is completed by only one mask layer and allows the IC to be used for many types of customers, applications and markets.

Complementary Metal Oxide Semiconductor (CMOS): a transistor technology used for the fabrication of integrated circuits.

Design Tools: a software application that is used to design, simulate, verify and implement the functionality of an integrated circuit. The final output of the design tools is used to create an IC mask layer.

Exabytes: one billion gigabytes.

Field Programmable Gate Array (FPGA): an integrated circuit whose functionality can be configured through software after the IC is manufactured.

Foundry: a factory where integrated circuits are manufactured.

Integrated Circuit (IC): a semiconductor device on which an electronic circuit is formed. This is also referred to as a “chip” or a microchip.

Input/Output (I/O): the part of an IC that enables electronic signals to either enter or exit the IC.

Mask Layer: a photolithographic mask that contains the circuitry patterns necessary to manufacture an IC. A typical IC requires approximately 50 mask layers. Each mask layer is used to transfer the circuitry pattern onto the wafer.

Moore’s Law: a quotation by Intel’s co-founder Gordon Moore stating that the number of transistors on an IC will double every 18 months. In 1975, Moore extended the 18-month timeframe to 24 months.

Non-Recurring Engineering (NRE) Charge: a one-time cost that is used for the design, development, and manufacture of a new IC.

Original Equipment Manufacturer (OEM): a company that designs, manufactures and sells products.

Performance: the clock speed of a particular chip, in each case as measured in megahertz.

Process Nodes: the transistor width used to define a semiconductor manufacturing process. Smaller widths allow more transistors to be manufactured in the same silicon area. Process node is measured in nanometers (nm), e.g., 28nm, 20nm, 14nm, etc.

Serializer/Deserializer (SerDes): a device that takes parallel data, such as 8 signals, and converts it into a single high speed serial stream for transmission. At the other end, it converts the serial data back to 8 parallel signals.

Vendor Managed Inventory (VMI): a means of optimizing the supply chain in which the manufacturer is responsible for maintaining inventory levels at a customer specified location under control of the manufacturer, which is usually referred to as a “hub.” The manufacturer owns and has access to the customer’s inventory, until such inventory is “pulled” by the customer, at which time the customer takes title to that inventory and is typically invoiced and revenues are recognized by the manufacturer.

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USE OF PROCEEDS

We estimate that we will receive net proceeds of approximately $         million (or approximately $         million if the underwriters exercise their over-allotment option in full) from the sale of the shares of common stock offered by us in this offering, based on an assumed initial public offering price of $         per share (the midpoint of the price range set forth on the cover page of this prospectus), and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. We will not receive any proceeds from the shares of common stock to be offered by the selling stockholders, although we will pay the expenses, other than underwriting discounts and commissions, associated with the sale of those shares. See “Principal and Selling Stockholders.”

A $1.00 increase (decrease) in the assumed initial public offering price of $         per share would increase (decrease) the net proceeds to us from this offering by approximately $         million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

Similarly, a one million share increase (decrease) in the number of shares offered by us, as set forth on the cover of this prospectus, would increase (decrease) the net proceeds to us by $         million, assuming the assumed initial public offering price of $         per share (the midpoint of the price range set forth on the cover of this prospectus), remains the same, and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

The principal purposes of this offering are to increase our capitalization and financial flexibility, facilitate our orderly distributions of shares for the selling stockholders, establish a public market for our common stock and to facilitate future access to the public equity markets by us, our employees and our stockholders, obtain additional capital to support our operations, and increase our visibility in the marketplace.

Our expected use of the net proceeds we receive from this offering represents our current intentions based upon our present plans and business condition. As of the date of this prospectus, we cannot predict with certainty all of the particular uses for the net proceeds to be received upon the completion of this offering or the amounts that we will actually spend on the uses set forth above. However, we currently intend to use the net proceeds to us from this offering primarily for general corporate purposes, including working capital, sales and marketing activities, product development, general and administrative matters, and capital expenditures, although we do not currently have any specific or preliminary plans with respect to the use of proceeds for such purposes. We also intend to use approximately $19.0 million of the net proceeds we receive from this offering to prepay the entirety of the outstanding indebtedness, including applicable prepayment penalties, if any, under (1) our revolving line of credit with Silicon Valley Bank (Line of Credit) and (2) each of our 2013 term loan facility (2013 Loan) and our 2014 term loan facility (2014 Loan) with Horizon Technology Finance Corporation, Horizon Funding Trust 2013-1, DBD Credit Funding LLC and Fortress Credit Opportunities I, LP. The Line of Credit carries a floating interest rate equal to prime plus 1.5% and matures on September 25, 2016. Secured notes issued by us under the 2013 Loan carry a fixed interest rate of 11% and mature on October 1, 2017. Secured notes issued by us under the 2014 Loan carry a fixed interest rate of 10.75% and mature on April 1, 2018. See the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Debt Obligations.” Our intentions to prepay our debt obligations with the net proceeds that we receive from this offering may change due to market or other factors. We also may use a portion of the net proceeds to acquire complementary businesses, products, services or technologies, however, we do not have agreements or commitments for any specific acquisitions at this time. We will have broad discretion over the use of the net proceeds we receive from this offering. Pending these uses, we intend to invest the net proceeds we receive from this offering in short-term, interest-bearing securities such as money market accounts, certificates of deposit, commercial paper and guaranteed obligations of the U.S. government. We may also make illiquid minority investments in private companies for strategic reasons, however, we do not have any agreements, commitments or plans for any specific minority investments at this time.

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The amounts and timing of our actual use of the net proceeds that we receive from this offering will vary depending on numerous factors, including our ability to gain access to additional financing, the relative success and cost of our research and development programs and whether we are able to enter into future licensing arrangements. As a result, our management will have broad discretion in the application of the net proceeds, and investors will be relying on our judgment regarding the application of the net proceeds of this offering. In addition, we might decide to postpone or not pursue certain development activities if the net proceeds from this offering and any other sources of cash are less than expected.

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DIVIDEND POLICY

We have never declared or paid cash dividends on our capital stock. We do not anticipate declaring or paying, in the foreseeable future, any cash dividends on our capital stock. We currently intend to retain all available funds and any future earnings to support our operations and finance the growth and development of our business. Any future determination related to our dividend policy will be made at the discretion of our board of directors and will depend upon, among other factors, our results of operations, financial condition, capital requirements, contractual restrictions, business prospects and other factors our board of directors may deem relevant. In addition, the terms of our existing Amended and Restated Venture Loan and Security Agreement with Horizon Technology Finance Corporation, Horizon Funding Trust 2013-1, DBD Credit Funding LLC and Fortress Credit Opportunities I, LP, dated September 12, 2014, and our Loan and Security Agreement with Silicon Valley Bank, as amended, dated September 29, 2010 restrict our ability to pay dividends or make distributions.

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CAPITALIZATION

The following table sets forth our cash and cash equivalents, and our capitalization as of March 31, 2015:

• on an actual basis;

• on a pro forma basis, giving effect to: (1) the conversion of all our outstanding convertible preferred stock as of March 31, 2015 into an aggregate of 5,145,683 shares of our common stock immediately prior to the completion of this offering, (2) the termination and cancellation of all 533,301 outstanding shares of our Series A-1 non-convertible preferred stock immediately prior to the completion of this offering, (3) the automatic conversion of all our convertible preferred stock warrants outstanding as of March 31, 2015 into warrants exercisable for the purchase of an aggregate of 111,505 shares of our common stock immediately prior to the completion of this offering, and the related reclassification of the preferred stock warrant liability to additional paid-in capital, and (4) the filing of our amended and restated certificate of incorporation, which will occur immediately prior to the completion of this offering; and

• on a pro forma as adjusted basis, reflecting the pro forma adjustments discussed above and giving further effect to the sale by us of              shares of our common stock in this offering at an assumed initial public offering price of $         per share (the midpoint of the range set forth on the cover of this prospectus), and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

The pro forma information below is illustrative only and our capitalization following the completion of this offering will be adjusted based on the actual initial public offering price and other terms of this offering determined at pricing. You should read this table together with “Selected Consolidated Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements and the related notes appearing elsewhere in this prospectus.

	As of March 31, 2015
	Actual			Pro Forma			Pro Forma As Adjusted(1)
	(Unaudited; In thousands, except share and per share data)
Cash and cash equivalents	$	9,222		$	9,222
Long-term debt, including current portion	$	18,467		$	18,467
Preferred stock warrant liability		1,042			—
Non-convertible Series A-1 preferred stock, $0.001 par value: 40,000,000 shares authorized and 533,301 shares issued and outstanding, actual; no shares authorized, issued or outstanding, pro forma and pro forma as adjusted		17,783			—
Convertible Series A-2 preferred stock, $0.001 par value: 450,000,000 shares authorized and 4,532,662 issued and outstanding, actual; no shares authorized, issued or outstanding, pro forma and pro forma as adjusted		23,503			—
Preferred stock, $0.001 par value: no shares authorized, issued or outstanding, actual; and 10,000,000 shares authorized and no shares issued or outstanding, pro forma and pro forma as adjusted		—			—
Common stock, $0.001 par value: 1,575,000,000 shares authorized and 9,909,735 shares issued and outstanding, actual; 100,000,000 shares authorized and 15,055,418 shares issued and outstanding, pro forma; and              shares issued and outstanding, pro forma as adjusted		11,740			54,068
Accumulated deficit		(45,714	)		(45,714	)
Total stockholders’ equity (deficit)		(33,974	)		8,354
Total capitalization	$	26,821		$	26,821

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(1) Each $1.00 increase (decrease) in the assumed initial public offering price of $         per share (the midpoint of the price range set forth on the cover page of this prospectus) would increase (decrease) the amount of cash and cash equivalents, additional paid-in capital and total capitalization by approximately $         million, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering costs payable by us. Each one million increase (decrease) in the number of shares offered by us as set forth on the cover page of this prospectus, would increase (decrease) each of our cash and cash equivalents, working capital (deficit), total assets, additional paid-in capital, and total stockholders’ equity by approximately $         million, assuming that the assumed initial public offering price of $         per share, which is the midpoint of the estimated offering price range reflected on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

The number of shares of our common stock to be outstanding after this offering is based on 15,055,418 pro forma shares of common stock outstanding as of March 31, 2015, and excludes:

• 3,413,188 shares of common stock issuable upon the exercise of outstanding stock options as of March 31, 2015, at a weighted-average exercise price of $1.39 per share;

• 2,865,129 shares of our common stock reserved for future issuance under our 2015 Plan, which will become effective as of the date of the effectiveness of the registration statement of which this prospectus forms a part, which includes (i) 215,129 shares of common stock reserved for issuance under our 2010 Plan, and (ii) stock options exercisable for an aggregate of 48,500 shares that our Compensation Committee has approved to be granted in connection with the pricing of our initial public offering with an exercise price equal to the initial public offering price;

• 530,000 shares of common stock reserved for future issuance under our 2015 employee stock purchase plan, or the 2015 ESPP, which will become effective upon the execution and delivery of the underwriting agreement for this offering;

• 111,505 shares of common stock issuable upon the exercise of convertible preferred stock warrants outstanding as of March 31, 2015, at an exercise price of approximately $5.19 per share;

• 32,268 shares of common stock issuable upon the exercise of common stock warrants outstanding as of March 31, 2015, at an exercise price of approximately $15.50 per share; and

• 75,752 shares of common stock issuable upon the exercise of common stock warrants outstanding as of March 31, 2015, at a weighted-average exercise price of approximately $16.37 per share, that terminate unless exercised immediately prior to the completion of this offering.

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DILUTION

If you invest in our common stock in this offering, your ownership interest will be immediately diluted to the extent of the difference between the initial public offering price per share of our common stock and the pro forma as adjusted net tangible book value per share of our common stock after this offering.

Our historical net tangible book value as of March 31, 2015, was approximately $(34.1) million, or $(3.44) per share of our common stock. Our historical net tangible book value is the amount of our total tangible assets less our liabilities and convertible preferred stock which is not included within stockholders’ equity. Historical net tangible book value per share is our historical net tangible book value divided by the number of shares of common stock outstanding as of March 31, 2015.

Our pro forma net tangible book value as of March 31, 2015, was $8.3 million, or $0.54 per share of common stock. Pro forma net tangible book value gives effect to (1) the conversion of all of our outstanding convertible preferred stock as of March 31, 2015, into an aggregate of 5,145,683 shares of our common stock and (2) the conversion of all outstanding warrants to purchase shares of our convertible preferred stock into warrants to purchase an aggregate of 111,505 shares of our common stock upon the completion of this offering, and the related reclassification of the preferred stock warrant liability to additional paid-in capital.

Pro forma as adjusted net tangible book value is our pro forma net tangible book value (deficit), plus the effect of the sale of              shares of our common stock in this offering at an assumed initial public offering price of $         per share (the midpoint of the range set forth on the cover of this prospectus), and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. This amount represents an immediate increase in pro forma as adjusted net tangible book value of $         per share to our existing stockholders, and an immediate dilution of $         per share to new investors participating in this offering.

The following table illustrates this dilution on a per share basis:

Assumed initial public offering price per share, the midpoint of the price range set forth on the cover page of this prospectus		$
Pro forma net tangible book value per share as of March 31, 2015	$0.54
Pro forma increase in net tangible book value per share as of March 31, 2015 attributable to this offering
Increase in pro forma net tangible book value per share attributable to investors participating in this offering
Pro forma as adjusted net tangible book value per share after this offering
Pro forma as adjusted dilution per share to investors participating in this offering		$

A $1.00 increase (decrease) in the assumed initial public offering price of $         per share (the midpoint of the price range set forth on the cover page of this prospectus) would increase (decrease) the pro forma as adjusted net tangible book value per share after this offering by approximately $         per share and the dilution in pro forma per share to investors participating in this offering by approximately $         per share, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

Similarly, a one million share increase (decrease) in the number of shares offered by us, as set forth on the cover of this prospectus, would increase (decrease) the pro forma as adjusted net tangible book value per share after this offering by approximately $         and decrease (increase) the dilution in pro forma per share to investors participating in this offering by approximately $        , assuming the assumed initial public offering price of

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$         per share (the midpoint of the price range set forth on the cover of this prospectus) remains the same, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

If the underwriters exercise their over-allotment option in full, the pro forma as adjusted net tangible book value will increase to $         per share, representing an immediate increase in pro forma as adjusted net tangible book value to existing stockholders of $         per share and an immediate decrease of dilution of $         per share to new investors participating in this offering.

The following table summarizes, on a pro forma as adjusted basis as of March 31, 2015, the number of shares purchased or to be purchased from us, the total consideration paid or to be paid to us, and the average price per share paid by existing stockholders or to be paid to us by investors participating in this offering at an assumed initial public offering price of $         per share (the midpoint of the price range set forth on the cover of this prospectus), before deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. As the table below shows, investors participating in this offering will pay an average price per share higher than our existing stockholders paid.

	Shares Purchased					Total Consideration					Average Price Per Share
	Number		Percent			Amount		Percent
	(In thousands)
Existing stockholders before this offering		15,055,418			%	$	135,802			%	$	9.02
Investors participating in this offering
Total				100	%	$			100	%

A $1.00 increase (decrease) in the assumed initial public offering price of $         per share (the midpoint of the price range set forth on the cover page of this prospectus) would increase (decrease) the total consideration paid by investors participating in this offering, total consideration paid by all stockholders and the average price per share paid by all stockholders by approximately $         million, $         million and $        , respectively, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and before deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

A one million share increase (decrease) in the number of shares offered by us, as set forth on the cover of this prospectus, would increase (decrease) the total consideration paid by investors participating in this offering, total consideration paid by all stockholders and the average price per share paid by all stockholders by approximately $         million, $         million and $        , respectively, assuming the assumed initial public offering price of $         per share (the midpoint of the price range set forth on the cover of this prospectus) remains the same, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

The foregoing discussion and tables are based on 15,055,418 pro forma shares of common stock outstanding as of March 31, 2015 and exclude:

• 3,413,188 shares of common stock issuable upon the exercise of outstanding stock options as of March 31, 2015, at a weighted-average exercise price of $1.39 per share;

• 2,865,129 shares of our common stock reserved for future issuance under our 2015 Plan, which will become effective as of the date of the effectiveness of the registration statement of which this prospectus forms a part, which includes (i) 215,129 shares of common stock reserved for issuance under our 2010 Plan, and (ii) stock options exercisable for an aggregate of 48,500 shares that our Compensation Committee has approved to be granted in connection with the pricing of our initial public offering with an exercise price equal to the initial public offering price;

• 530,000 shares of common stock reserved for future issuance under our 2015 employee stock purchase plan, or the 2015 ESPP, which will become effective upon the execution and delivery of the underwriting agreement for this offering;

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• 111,505 shares of common stock issuable upon the exercise of convertible preferred stock warrants outstanding as of March 31, 2015, at an exercise price of approximately $5.19 per share;

• 32,268 shares of common stock issuable upon the exercise of common stock warrants outstanding as of March 31, 2015, at an exercise price of approximately $15.50 per share; and

• 75,752 shares of common stock issuable upon the exercise of common stock warrants outstanding as of March 31, 2015, at a weighted-average exercise price of approximately $16.37 per share, that terminate unless exercised immediately prior to the completion of this offering.

We may choose to raise additional capital through the sale of equity or convertible debt securities due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. To the extent we issue additional shares of common stock or other equity or convertible debt securities in the future, there will be further dilution to investors participating in this offering.

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SELECTED CONSOLIDATED FINANCIAL DATA

The selected consolidated statements of operations data for the years ended December 31, 2012, 2013 and 2014 and the consolidated balance sheet data as of December 31, 2013 and 2014 are derived from our audited consolidated financial statements included elsewhere in this prospectus. The selected consolidated statements of operations data for the three months ended March 31, 2014 and 2015, and the selected consolidated balance sheet data as of March 31, 2015, are derived from our unaudited interim consolidated financial statements included elsewhere in this prospectus. The unaudited interim consolidated financial statements were prepared on a basis consistent with our audited consolidated financial statements and, in the opinion of management, include all adjustments of a normal, recurring nature that are necessary for the fair presentation of the financial statements. The selected consolidated financial data below should be read in conjunction with the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes included elsewhere in this prospectus. The selected consolidated financial data in this section are not intended to replace our consolidated financial statements and the related notes, and are qualified in their entirety by the consolidated financial statements and related notes included elsewhere in this prospectus. Our historical results are not necessarily indicative of the results that may be expected for any period in the future and the results for the three months ended March 31, 2015 are not necessarily indicative of results to be expected for the full year 2015 or any future period.

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
										(Unaudited)
	(In thousands, except share and per share data)
Consolidated statements of operations data:
Revenues:
Product	$	11,843		$	26,111		$	65,086		$	12,265		$	19,658
Service		1,840			3,666			2,294			1,312			417
Total revenues		13,683			29,777			67,380			13,577			20,075
Cost of revenues(1):
Product		8,707			14,968			37,366			7,040			11,178
Service		373			748			636			420			190
Total cost of revenues		9,080			15,716			38,002			7,460			11,368
Gross profit		4,603			14,061			29,378			6,117			8,707
Operating expenses(1):
Research and development		11,898			13,026			13,870			3,038			3,701
Sales and marketing		4,494			4,834			5,711			1,183			1,331
General and administrative		2,543			3,076			5,449			746			2,491
Total operating expenses		18,935			20,936			25,030			4,967			7,523
Income (loss) from operations		(14,332	)		(6,875	)		4,348			1,150			1,184
Interest expense		(1,042	)		(935	)		(1,443	)		(301	)		(445	)
Other income (expense), net		72			12			(836	)		(88	)		(38	)
Income (loss) before income taxes		(15,302	)		(7,798	)		2,069			761			701
Benefit from (provision for) income taxes		(57	)		(44	)		(3,216	)		(360	)		5
Net income (loss)	$	(15,359	)	$	(7,842	)	$	(1,147	)	$	401		$	706
Add/(Less): Capital contribution from/(deemed dividend to) common stockholders(2)		83,386			(338	)		—			—			—
Less: Undistributed earnings allocated to preferred stockholders		—			—			—			(401	)		(706	)
Net income (loss) attributable to common stockholders	$	68,027		$	(8,180	)	$	(1,147	)	$	—		$	—
Net income (loss) per share attributable to common stockholders(3):
Basic	$	213.75		$	(0.90	)	$	(0.12	)	$	0.00		$	0.00
Diluted	$	(4.06	)	$	(0.90	)	$	(0.12	)	$	0.00		$	0.00
Weighted-average common shares used in computing net income (loss) per share attributable to common stockholders(3):
Basic		318,249			9,066,797			9,518,377			9,436,046			9,682,424
Diluted		3,786,303			9,066,797			9,518,377			9,436,046			9,682,424
Pro forma net income (loss) attributable to common stockholders (unaudited)(3)							$	(364	)				$	545
Pro forma net income (loss) per share attributable to common stockholders (unaudited)(3):
Basic							$	(0.02	)				$	0.04
Diluted							$	(0.02	)				$	0.03
Pro forma weighted-average common shares used in computing income (loss) per share attributable to common stockholders (unaudited)(3):
Basic								14,664,060						14,828,107
Diluted								14,664,060						17,828,111

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(1) Stock-based compensation included in the consolidated statements of operations data above was as follows:

	Year Ended December 31,						Three Months Ended March 31,
	2012		2013		2014		2014		2015
							(Unaudited)
	(In thousands)
Cost of product revenues	$	1	$	5	$	5	$	1	$	1
Research and development		75		256		485		33		141
Sales and marketing		17		485		286		12		70
General and administrative		150		573		558		40		136
Total	$	243	$	1,319	$	1,334	$	86	$	348

(2) See Note 6 to our consolidated financial statements appearing elsewhere in this prospectus for an explanation of the capital contribution from (deemed dividend) to common stockholders.

(3) See Notes 1 and 8 to our consolidated financial statements appearing elsewhere in this prospectus for an explanation of the calculations of our basic and diluted net income per share attributable to common stockholders and our basic and diluted pro forma net income per share attributable to common stockholders.

	As of December 31,						As of March 31,
	2013			2014			2015
							(Unaudited)
	(In thousands)
Consolidated balance sheet data:
Cash and cash equivalents	$	7,423		$	8,790		$	9,222
Working capital		15,343			19,630			17,710
Total assets		24,912			43,118			41,179
Total deferred revenues		1,152			321			374
Total non-current income taxes payable		—			3,081			3,079
Total capital lease, non-current portion		—			255			221
Total long-term debt, non-current portion		10,748			15,949			15,024
Vendor financing arrangement		1,381			1,280			1,302
Convertible preferred stock warrant liabilities		271			1,203			1,042
Total preferred stock		41,286			41,286			41,286
Total stockholders’ deficit		(35,508	)		(35,095	)		(33,974	)

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations together with the consolidated financial statements and related notes that are included elsewhere in this prospectus. This discussion contains forward-looking statements based upon current plans, expectations and beliefs that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Risk Factors” and in other parts of this prospectus.

Overview

We have pioneered a differentiated solution that enables us to rapidly and cost-effectively deliver custom integrated circuits (ICs), creating value for our customers’ hardware and software systems. Our eASIC solution consists of our eASIC platform which incorporates a versatile, pre-defined and reusable base array and customizable single-mask layer, our ASICs, delivered by using either our easicopy or standard ASIC methodologies, and our proprietary design tools. Customers can efficiently migrate to our easicopy ASIC from the eASIC platform using our easicopy methodology. We believe our eASIC solution provides the optimal combination of fast time-to-market, high performance, low power consumption, low development cost and low unit cost for our customers. Our solution has broad applicability across a wide range of customers, applications and end markets including communications infrastructure, storage and data processing and industrial applications. Our solution should position us to address additional end markets in the future. As of March 31, 2015, we have leveraged our eASIC platform to develop four generations of eASIC products with increasingly smaller process nodes, and we have designed over 200 custom ICs and shipped over 21 million units.

We believe the need for differentiation through custom ICs is driven by several megatrends, including the proliferation of mobile devices driving the deployment of high capacity and high bandwidth wireless infrastructure, the rapid transition to cloud computing and the emergence of big data analytics. We believe the ability to differentiate hardware and software systems through custom ICs is critical to helping our customers grow faster than their competitors and enhance their profit margins. Historical solutions for customized ICs have included Application Specific Integrated Circuits (ASICs), Application Specific Standard Products (ASSPs) and Field Programmable Gate Arrays (FPGAs). We believe our products avoid the painful tradeoffs associated with these historical solutions. For example, based on data provided by a majority of our customers for power consumption with respect to those customers’ designs using FPGAs, as well as our own internal analysis using the latest generation of custom ICs based on our eASIC platform, we believe that we can enable our customers to reduce power consumption by 50% to 80% compared to FPGAs at the same process node. In addition, in all five cases where customers have required that our design provide an increase in performance, as measured by clock speed of the chip, we have been able to improve performance by 60% to 120% compared to FPGAs at the same process node. With our eASIC platform, we believe our customers can significantly reduce non-recurring engineering (NRE) charges and lower design and manufacturing time by nine to 12 months or more when compared to traditional ASIC design and manufacturing processes. We believe our competitive advantages will increase over time as the costs and complexity associated with the development and manufacturing of future generations of ICs continue to rise.

We believe our competitive advantages should become more pronounced as continued technological advancements increase overall development and manufacturing costs for future generations of ICs. We estimate that our addressable market opportunity across ASIC, ASSP and FPGA applications is approximately $78 billion, based on data from Gartner Research. During the year ended December 31, 2014 and the three months ended March 31, 2015, we sold our products and services to over 14 customers and 10 customers, respectively, including Ericsson, Fujitsu, Huawei, NEC, Omnivision, Seagate and Toshiba. The number of customers varies between different periods due to timing of orders from customers.

For the years ended December 31, 2012, 2013 and 2014, our revenues were $13.7 million, $29.8 million and $67.4 million, respectively, and our net loss was $15.4 million, $7.8 million and $1.1 million, respectively. For

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the three months ended March 31, 2014 and 2015, our revenues were $13.6 million and $20.1 million, respectively, and our net income was $0.4 million and $0.7 million, respectively.

Our Business Model

We derive revenues from our eASIC solutions which include our eASIC platform as well as our easicopy and standard ASICs. We primarily generate product revenues from the sale of custom ICs to OEMs. We also generate service revenues from the design and development of ICs for customers and related design services and prototypes.

We shipped our first products in January 2008 and, since the beginning of 2013, our product revenues have grown rapidly. A significant portion of our total revenues to date has been generated from two customers, Ericsson and Seagate, including sales to contract manufacturers or original device manufacturers (ODM) at the direction of such end customers. In 2012, 2013, 2014 and the first three months of 2015, Ericsson and Seagate together accounted for 73%, 87%, 93% and 95% of our total revenues, respectively. For the year ended December 31, 2014 and the three months ended March 31, 2015, Ericsson alone represented 62% and 79% of our total revenues, respectively. To continue to grow our revenues, it is important that we both obtain new customers and sell additional products to existing customers. While we intend to expand our customer base over time, the markets we serve tend to be highly concentrated, and we expect that a large portion of our revenues will likely be derived from a relatively small number of customers for the foreseeable future.

We market and sell our products through our sales force and field applications engineers. For certain customers, we use independent sales representatives or non-stocking distributors. We have direct sales personnel covering the United States and Asia focusing primarily on major OEM customers and have sales offices in Santa Clara, California and Hong Kong. We also employ business development teams in China and Japan to work closely with local ODMs that support our broader customer base. During 2014, 2% of our revenues were generated from the Americas, substantially all from the United States, 51% from Europe, the Middle East and Africa and 47% from the Asia-Pacific region.

For select direct customers that represent a significant portion of our revenues, we maintain inventory of our product at a customer specified location (known as Vendor Managed Inventory, or VMI) and are notified when our products are either ordered or “pulled” by our customers to meet their manufacturing needs. We own and have access to the inventory, until such inventory is “pulled” by the customer, at which time the customer takes title to that inventory, we invoice the customer and recognize revenues. This VMI structure allows our customers the flexibility to modify their manufacturing volumes without being affected by the long production lead times typically required of custom ICs and provides us with enhanced insights into our customers’ supply needs. However, this may result in our revenues being more volatile.

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Non-GAAP Financial Measures

We use the financial measures set forth below, which are non-GAAP financial measures, to help us analyze our financial results, establish budgets and operational goals for managing our business and to evaluate our performance. We also believe that the presentation of these non-GAAP financial measures provides an additional tool for investors to use in comparing our core business and results of operations over multiple periods with other companies in our industry, many of which present similar non-GAAP financial measures to investors. However, the non-GAAP financial measures presented in this prospectus may not be comparable to similarly titled measures reported by other companies due to differences in the way that these measures are calculated. The non-GAAP financial measures presented in this prospectus should not be considered as the sole measure of our performance and should not be considered in isolation from, or as a substitute for, comparable financial measures calculated in accordance with GAAP. The financial measures set forth below also contain certain comparable GAAP financial measures.

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
										(Unaudited)
	(In thousands, except percentages)
GAAP gross profit	$	4,603		$	14,061		$	29,378		$	6,117		$	8,707
GAAP gross margins		34	%		47	%		44	%		45	%		43	%
Non-GAAP gross profit	$	4,604		$	14,066		$	29,383		$	6,118		$	8,708
Non-GAAP gross margins		34	%		47	%		44	%		45	%		43	%
GAAP income (loss) from operations	$	(14,332	)	$	(6,875	)	$	4,348		$	1,150		$	1,184
GAAP operating margin (loss)		(105	%)		(23	%)		6	%		9	%		6	%
Non-GAAP income (loss) from operations	$	(14,089	)	$	(5,556	)	$	5,682		$	1,236		$	1,532
Non-GAAP operating margin (loss)		(103	%)		(19	%)		8	%		9	%		8	%
Adjusted EBITDA	$	(13,609	)	$	(5,010	)	$	6,589		$	1,385		$	1,959
Adjusted EBITDA margin		(99	%)		(17	%)		10	%		10	%		10	%
Cash flow provided by (used in) operating activities	$	(10,442	)	$	(13,478	)	$	542		$	(74	)	$	1,461
Free cash flow	$	(10,966	)	$	(15,607	)	$	(4,774	)	$	(1,852	)	$	1,100

Non-GAAP gross profit and margins. We define non-GAAP gross profit as gross profit as reported on our consolidated statements of operations, excluding the impact of stock-based compensation, which is a non-cash charge. We define non-GAAP gross margins as non-GAAP gross profit divided by revenues. We have presented non-GAAP gross profit and margins because we believe that the exclusion of stock-based compensation allows for more accurate comparisons of our results of operations to other companies in our industry. Please see “Reconciliation of Non-GAAP Financial Measures” below for information regarding the limitations of using non-GAAP gross profit and gross margins as financial measures and for a reconciliation of non-GAAP gross profit to gross profit, the most directly comparable financial measure calculated in accordance with U.S. generally accepted accounting principles (GAAP).

Non-GAAP income (loss) from operations and operating margin (loss). We define non-GAAP income (loss) from operations as income (loss) from operations as reported on our consolidated statements of operations, excluding the impact of stock-based compensation, which is a non-cash charge. We define non-GAAP operating margin (loss) as non-GAAP income (loss) from operations divided by revenues. We have presented non-GAAP income (loss) from operations and operating margin (loss) because we believe that the exclusion of stock-based compensation allows for more accurate comparisons of our results of operations to other companies in our industry. Please see “Reconciliation of Non-GAAP Financial Measures” below for information regarding the limitations of using non-GAAP income (loss) from operations and operating margin (loss) as financial measures and for a reconciliation of non-GAAP income (loss) from operations to income (loss) from operations, the most directly comparable financial measure calculated in accordance with GAAP.

Adjusted EBITDA and adjusted EBITDA margin. We define adjusted EBITDA as our net loss excluding: (1) stock-based compensation; (2) interest expense; (3) other income (expense), net, which primarily includes

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foreign exchange gains and losses; (4) depreciation and amortization; and (5) our provision for income taxes. We define adjusted EBITDA margin as adjusted EBITDA divided by revenues. We have presented adjusted EBITDA and adjusted EBITDA margin because we believe it is an important measure used by industry analysts and investors to compare our performance against our peer group and analyze our cash generation performance. In particular, we believe that the exclusion of the expenses eliminated in calculating adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core operating performance. Please see “Reconciliation of Non-GAAP Financial Measures” below for information regarding the limitations of using adjusted EBITDA and adjusted EBITDA margin as financial measures and for a reconciliation of adjusted EBITDA to net loss, the most directly comparable financial measure calculated in accordance with GAAP.

Free cash flow. We define free cash flow as net cash used in operating activities less property and equipment purchases, including certain mask sets. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that, after capital purchases, can be used for strategic opportunities, including investing in our business, making strategic acquisitions, and strengthening the balance sheet. Please see “Reconciliation of Non-GAAP Financial Measures” below for more information and a reconciliation of free cash flow to cash flow used in operating activities, the most directly comparable financial measure calculated and presented in accordance with GAAP.

Reconciliation of Non-GAAP Financial Measures

Our non-GAAP measures have limitations as analytical tools and you should not consider them in isolation or as a substitute for an analysis of our results under GAAP. There are a number of limitations related to the use of these non-GAAP financial measures versus their nearest GAAP equivalents. First, non-GAAP gross profit and gross margins and income (loss) from operations and operating margin (loss) are not substitutes for gross profit, gross margins, income (loss) from operations and operating margin (loss). Second, other companies may calculate non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. Finally, adjusted EBITDA, adjusted EBITDA margin and free cash flow exclude some costs, namely, non-cash stock-based compensation, interest expense and provision for income taxes, which are recurring. Therefore, adjusted EBITDA, adjusted EBITDA margin and free cash flow do not reflect the impact of stock-based compensation or working capital needs that will continue for the foreseeable future.

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The following tables reconcile the most directly comparable GAAP financial measure to each of these non-GAAP financial measures.

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
	(In thousands, except percentages)
Non-GAAP gross profit and margins:
Total revenues	$	13,683		$	29,777		$	67,380		$	13,577		$	20,075
Gross profit		4,603			14,061			29,378			6,117			8,707
Stock-based compensation		1			5			5			1			1
Non-GAAP gross profit	$	4,604		$	14,066		$	29,383		$	6,118		$	8,708
Non-GAAP gross margins		34	%		47	%		44	%		45	%		43	%
Non-GAAP income from operations and operating margin (loss):
Total revenues	$	13,683		$	29,777		$	67,380		$	13,577		$	20,075
Income (loss) from operations		(14,332	)		(6,875	)		4,348			1,150			1,184
Stock-based compensation		243			1,319			1,334			86			348
Non-GAAP income (loss) from operations	$	(14,089	)	$	(5,556	)	$	5,682		$	1,236		$	1,532
Non-GAAP operating margin (loss)		(103	%)		(19	%)		8	%		9	%		8	%
Adjusted EBITDA and adjusted EBITDA Margin:
Total revenues	$	13,683		$	29,777		$	67,380		$	13,577		$	20,075
Net income (loss)		(15,359	)		(7,842	)		(1,147	)		401			706
Provision for (benefit from) income taxes		57			44			3,216			360			(5	)
Interest expense		1,042			935			1,443			301			445
Other (income) expense, net		(72	)		(12	)		836			88			38
Depreciation and amortization		480			546			907			149			427
Stock-based compensation		243			1,319			1,334			86			348
Adjusted EBITDA	$	(13,609	)	$	(5,010	)	$	6,589		$	1,385		$	1,959
Adjusted EBITDA margin		(99	%)		(17	%)		10	%		10	%		10	%
Free cash flow:
Cash flow provided by (used in) operating activities	$	(10,442	)	$	(13,478	)	$	542		$	(74	)	$	1,461
Less: purchases of property and equipment		(524	)		(2,129	)		(5,316	)		(1,778	)		(361	)
Free cash flow	$	(10,966	)	$	(15,607	)	$	(4,774	)	$	(1,852	)	$	1,100

Key Factors Affecting Our Performance

Design Wins with New and Existing Customers. Our solutions enable our customers to differentiate their products in order to drive their future revenue growth and profits. We view our solutions as a crucial aspect of our current and potential customers’ success and we work closely with our customers and targeted prospects to understand their product roadmaps and strategies. Our current customers and prospects tend to be multinational enterprises with large annual purchases of ICs and they continuously develop new products in existing and new application areas. We have programs in place to help our existing customers to utilize our solutions throughout their organizations. Because we expect our revenues relating to our mature products to decline in the future, we also consider design wins critical to our future success and anticipate being increasingly dependent on revenues from newer design wins for our newer products.

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Customer Demand and Product Life Cycles. Once customers design our ICs into their products, we closely monitor all aspects of their demand, including the initial design phase, prototype production, volume production and inventories, as well as end market demand, including seasonality, cyclicality and the competitive landscape. Given our customer relationships and the long-term aspects of our platform, we benefit from visibility into customer demand once we secure a design win, as the combination of the design and product life cycles provide an opportunity for us to monitor and hone our business fundamentals.

Product Adoption within New Markets and Applications. Due to the painful tradeoffs customers traditionally have been forced to make in order to utilize custom ICs in their products, we believe that our methodologies can be used to more efficiently develop ASICs to be used instead of traditional ASICs, ASSPs or FPGAs. We monitor the overall market to determine where our solutions can have a positive impact and we take a very strategic approach to target customers and applications that can benefit from our solutions in order to increase the breadth of our customer engagements and target end markets.

Pricing, Product Cost and Design Mix. Our pricing and margins depend on the volumes and the features of the custom ICs we provide to our customers. The average selling price, or ASP, for each ASIC design can be influenced by a number of factors, including the complexity of the design, the customer’s application, the customer’s relative negotiation power and the volume levels to be produced. ASPs are negotiated either when the initial design is awarded by the customer, or during annual negotiation cycles between us and the customer. Each of our custom ICs has its own ASP and cost of goods sold, or COGS, therefore the mix of custom ICs that we sell in any given quarter will have an impact on gross margins. A significant shift in mix from high margin custom ICs to low margin custom ICs would have a material impact on our gross margins. We continually monitor and work to improve the cost of our custom ICs and the potential value of our solution as we target new design win opportunities and manage the product life cycles of our existing customer designs. Since we rely on third-party wafer foundries and assembly and test contractors to manufacture, assemble and test our custom ICs, we maintain a close relationship with these suppliers to improve quality, increase yields and lower manufacturing costs.

Components of Operating Results

Revenues

We generate revenues primarily from the sales of our products and secondarily from services. As discussed further in “—Critical Accounting Policies and Estimates—Revenue Recognition” below, revenues are recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable and collectability is reasonably assured.

Our total revenues consist of the following:

• Product revenues. Our product revenues are generated from sales of our ICs. We recognize product revenues at the time of shipment, provided that all other revenue recognition criteria have been met. A substantial majority of our sales are made on a VMI basis in which we maintain inventory of our product at a customer specified location, which we refer to as a hub. Title to that inventory transfers to our customer, and revenues are recognized, when our products are “pulled” from our hub locations or delivered to our customers, as needed to meet their manufacturing requirements. We invoice our customer when this transaction occurs. In addition, we have sales to non-stocking distributors that sell directly to end-users for which we do not grant return privileges, except for defective products during the warranty period, nor do we grant pricing credits. Accordingly, we recognize revenues upon transfer of title and risk of loss or damage, generally upon shipment.

• Service revenues. Our service revenues are generated from design and development of ICs for our customers and related design services and prototypes. Revenues are recognized based on attainment of contract milestones, including final acceptance of design and delivery of prototype ICs.

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Cost of revenues

Cost of product revenues primarily consists of costs paid to our third-party contract manufacturers, and personnel and other costs associated with our manufacturing operations. Our cost of product revenues also includes product testing costs, as well as allocation of overhead costs for facilities, information technology, depreciation and amortization. We expect our cost of product revenues in absolute dollars to increase as our product revenues increase.

Cost of service revenues consists primarily of costs for personnel in our customer engineering group to complete the design work necessary to meet the contractual milestones with our customers, and engineering service and material charges from third-party vendors including our contract manufacturers. We expect our cost of service revenues in absolute dollars to increase as our service revenues increase.

Gross Margins

Gross margins, or gross profit as a percentage of revenues, has been and will continue to be affected by a variety of factors, including the specific ASP and COGS of a given custom IC, the mix of custom ICs in a given period, whether higher or lower margin IC designs and manufacturing operations costs. We believe the primary driver of product gross margins is the ASP negotiated between us and the customer on a specific ASIC design relative to the cost to manufacture that specific ASIC design.

We believe that by providing customers with the ability to choose among the methodologies we offer in designing and developing our custom ICs, customers benefit from minimizing the painful tradeoffs customers are forced to make using traditional ASICs, ASSPs or FPGAs. The choice of which methodology we use to design our ASICs is driven by the particular customer’s product requirements, including its project schedules, performance needs, power consumption needs and cost requirements, as well as the customer’s expected production volume. For the years ended December 31, 2012, 2013 and 2014 and the three months ended March 31, 2014 and 2015, our product revenues derived from our eASIC platform methodology represented 87%, 61%, 68%, 67% and 84%, respectively, of our total product revenues. The remainder of our product revenues was generated from our easicopy and ASIC methodologies.

The selection of a particular methodology to be used in the development of our ASICs is uncertain, as it continues to be subject to the specific needs of our customers and is not completely in our control. However, the custom ICs we sell that are derived from either our easicopy or to ASIC methodology is the same, so there is no impact on our product revenues or product gross margins as a result of one methodology being used over the other. Therefore, we do not believe that the selection of a particular ASICs design methodology is a meaningful indicator of future gross margins or operating results. While we expect our product gross margins to fluctuate on a quarterly basis as a result of these factors described above, we expect our overall gross margins to improve over time as we are able to reduce COGS by negotiating more favorable pricing from our suppliers as our volumes increase.

Operating expenses

Our operating expenses consist of research and development, sales and marketing, and general and administrative expense. Personnel costs are the most significant component of operating expenses and consist of salaries, benefits, bonuses, stock-based compensation and, with regard to sales and marketing expense, sales commissions. Operating expenses also include allocation of overhead costs for facilities, finance support, information technology and depreciation. Although our operating expenses may fluctuate, we expect our operating expenses to decline as a percentage of total revenues over time.

• Research and development. Research and development expense consists primarily of personnel, outside consulting and engineering services costs and allocated overhead. Research and development expense also includes the cost to develop our internal tools and service fees for third-party design tools. We

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have entered into easicopy or ASIC development agreements with customers for shared development, under which research and development costs are eligible for reimbursement. Amounts reimbursed under this arrangement are offset against research and development expenses. We expect research and development expense to continue to increase in absolute dollars as we continue to invest in our research and product development efforts to enhance our product capabilities, continue to invest in design tools, both third party and internally developed, and access new customer markets.

• Sales and marketing. Sales and marketing expense consists primarily of personnel costs, incentive commission costs and allocated overhead. We expense commission costs as earned. Sales and marketing expense also includes costs for market development programs, promotional and other marketing activities, travel, office equipment, depreciation and outside consulting costs. We expect sales and marketing expense to continue to increase in absolute dollars as we increase the size of our sales and marketing organizations, increase marketing programs and expand our international operations.

• General and administrative. General and administrative expense consists of personnel costs, professional services and allocated overhead. General and administrative personnel include our executive, finance, human resources, facilities, information technology and legal organizations. Professional services consist primarily of legal, auditing, accounting and other consulting costs. We allocate a portion of our general and administrative expense to cost of revenues, research and development and sales and marketing. We expect general and administrative expense to continue to increase in absolute dollars as we have recently incurred, and expect to continue to incur, additional general and administrative expenses as we grow our operations and prepare to operate as a public company, including higher legal, corporate insurance and accounting expenses.

Interest expense and Other income (expense), net

Interest expense consists of interest on our outstanding debt. See Note 4 to our consolidated financial statements for more information about our debt.

Other expense, net consists primarily of the change in fair value of our preferred stock warrant liability and foreign exchange gains or losses. Convertible preferred stock warrants are classified as a liability on our consolidated balance sheets and remeasured to fair value at each balance sheet date with the corresponding change recorded as other expense. Upon the earlier of the exercise of the warrants or the completion of a liquidation event, including the completion of this offering, the liability will be reclassified to stockholders’ deficit, at which time it will no longer be subject to fair value accounting.

Provision for income taxes

Provision for income taxes consists primarily of U.S. federal and state income taxes in the United States and income taxes in certain foreign jurisdictions in which we conduct business. We have a full valuation allowance for deferred tax assets, including net operating loss carryforwards, and tax credits related primarily to research and development. We expect to maintain this full valuation allowance for the foreseeable future.

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Results of Operations

The following tables summarize our results of operations for the periods presented and as a percentage of our total revenues for those periods. The interim period is not necessarily indicative of results to be expected for a full year and the period-to-period comparison of results is not necessarily indicative of results for future periods.

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
										(Unaudited)
	(In thousands)
Revenues:
Product	$	11,843		$	26,111		$	65,086		$	12,265		$	19,658
Service		1,840			3,666			2,294			1,312			417
Total revenues		13,683			29,777			67,380			13,577			20,075
Cost of revenues:
Product		8,707			14,968			37,366			7,040			11,178
Service		373			748			636			420			190
Total cost of revenues		9,080			15,716			38,002			7,460			11,368
Gross profit		4,603			14,061			29,378			6,117			8,707
Operating expenses:
Research and development		11,898			13,026			13,870			3,038			3,701
Sales and marketing		4,494			4,834			5,711			1,183			1,331
General and administrative		2,543			3,076			5,449			746			2,491
Total operating expenses		18,935			20,936			25,030			4,967			7,523
Income (loss) from operations		(14,332	)		(6,875	)		4,348			1,150			1,184
Interest expense		(1,042	)		(935	)		(1,443	)		(301	)		(445	)
Other income (expense), net		72			12			(836	)		(88	)		(38	)
Income (loss) before income taxes		(15,302	)		(7,798	)		2,069			761			701
Benefit from (provision for) income taxes		(57	)		(44	)		(3,216	)		(360	)		5
Net income (loss)	$	(15,359	)	$	(7,842	)	$	(1,147	)	$	401		$	706

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The following table sets forth our consolidated statements of operations data as a percentage of total revenues for the periods indicated:

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
										(Unaudited)
	(As a percentage of total revenues)
Revenues:
Product		87	%		88	%		97	%		90	%		98	%
Service		13			12			3			10			2
Total revenues		100			100			100			100			100
Cost of revenues:
Product		64			50			55			52			56
Service		3			3			1			3			1
Total cost of revenues		67			53			56			55			57
Gross profit		33			47			44			45			43
Operating expenses:
Research and development		87			44			21			22			18
Sales and marketing		33			16			8			9			7
General and administrative		19			10			8			5			12
Total operating expenses		139			70			37			36			37
Income (loss) from operations		(106	)		(23	)		7			9			6
Interest expense		(8	)		(3	)		(2	)		(2	)		(2	)
Other income (expense), net		1			—			(1	)		(1	)		—
Income (loss) before income taxes		(113	)		(26	)		4			6			4
Provision for income taxes		—			—			(5	)		(3	)		—
Net income (loss)		(113	)%		(26	)%		(1	)%		3	%		4	%

Comparison of the Three Months Ended March 31, 2014 and 2015

Revenues

	Three Months Ended March 31,										Change
	2014		% of Total Revenues			2015		% of Total Revenues			$			%
	(Dollars in thousands)
Revenues:
Product	$	12,265		90	%	$	19,658		98	%	$	7,393			60
Service		1,312		10			417		2			(895	)		(68	)%
Total revenues	$	13,577		100	%	$	20,075		100	%	$	6,498			48	%

Total revenues increased by $6.5 million, or 48%, for the three months ended March 31, 2015 compared to the three months ended March 31, 2014. Product revenues increased by $7.4 million, or 60%, for the three months ended March 31, 2015 compared to the three months ended March 31, 2014, primarily due to an increase in our sales to one of our largest customers, due to greater demand from their end customers in the wireless communications infrastructure segment, partially offset by a decrease in revenues generated from another large customer in the storage market related to softer demand in the PC market. Further, service revenues were lower in the three months ended March 31, 2015 compared to the three months ended March 31, 2014, primarily due to the timing of the attainment of design services and prototype milestones. In the three months ended March 31, 2014, we completed more designs and deliveries of prototypes compared to the three months ended March 31, 2015.

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We market and sell our products worldwide. We attribute revenues to the geography based on where customers are billed. Our revenues by geography for the periods indicated were as follows:

	Three Months Ended March 31,										Change
	2014		% of Total Revenues			2015		% of Total Revenues			$			%
	(Dollars in thousands)
Revenues by geographic region:
United States	$	524		4	%	$	50		—	%	$	(474	)		(90	)%
Rest of Americas		100		1			—		—			(100	)		(100	)
Europe		4,441		33			15,904		79			11,463			258
Asia Pacific		8,512		62			4,121		21			(4,391	)		(52	)
Total revenues	$	13,577		100	%	$	20,075		100	%	$	6,498			48	%

The shift in revenues from the Asia Pacific region in the three months ended March 31, 2014 to Europe in the three months ended March 31, 2015 was primarily driven by a change in one of our largest end customer’s billing address, at the direction of that end customer.

See Note 9 to our consolidated financial statements for additional information regarding revenues by geography.

Cost of revenues and gross margins

	Three Months Ended March 31,
	2014					2015
	Amount		Gross Margins			Amount		Gross Margins			Change
	(Dollars in thousands)
Cost of revenues:
Product	$	7,040				$	11,178				$	4,138
Service		420					190					(230	)
Total cost of revenues	$	7,460				$	11,368				$	3,908
Gross margins:
Product				43	%				43	%		—	%
Service				68	%				54	%		(14	)%
Total gross margins				45	%				43	%		(2	)%

Cost of product revenues increased by $4.1 million for the three months ended March 31, 2015 compared to the three months ended March 31, 2014. The increase was primarily related to costs associated with an increase in the volume of products sold. Cost of service revenues decreased by $0.2 million for the three months ended March 31, 2015 compared to the three months ended March 31, 2014, corresponding to the decline in service revenues.

Total product gross margins remained the same for the three months ended March 31, 2015 compared to the three months ended March 31, 2014. For the three months ended March 31, 2015, our gross margins decreased by six percentage points due to declines in the average selling prices of our products. That adverse impact was offset primarily by cost reductions from our supply chain due to higher production volumes. Service revenues margin decreased by 14 percentage points for the three months ended March 31, 2015 compared to the three months ended March 31, 2014, primarily due to recognition of $0.3 million of nonrefundable customer payment as revenue upon cancellation of a design service contract by one customer in the first quarter of fiscal year 2014.

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Operating expenses

	Three Months Ended March 31,										Change
	2014		% of Total Revenues			2015		% of Total Revenues			$		%
	(Dollars in thousands)
Operating expenses:
Research and development	$	3,038		22	%	$	3,701		18	%	$	663		22	%
Sales and marketing		1,183		9			1,331		7			148		13
General and administrative		746		5			2,491		12			1,745		234
Total operating expenses	$	4,967		36	%	$	7,523		37	%	$	2,556		51	%
Includes stock-based compensation of:
Research and development	$	33				$	141				$	108
Sales and marketing		12					70					58
General and administrative		40					136					96
Total	$	85				$	347				$	262

Research and development. Research and development expense increased by $0.7 million, or 22%, for the three months ended March 31, 2015 compared to the three months ended March 31, 2014. The increase was due to an increase in our headcount to support the development of our future products and internal software development tools, as well as increased investment in third-party design tools. We enter into agreements with customers for shared development, under which research and development costs are eligible for reimbursement. Amounts reimbursed under these arrangements are offset against research and development expenses. In connection with such agreements, we offset against research and development expense an amount of $.02 million and $0.2 million, for the three months ended March 31, 2014 and 2015, respectively.

Sales and marketing. Sales and marketing expense increased by $0.1 million, or 13%, for the three months ended March 31, 2015 compared to the three months ended March 31, 2014, due to an increase in our headcount in sales and marketing.

General and administrative. General and administrative expense increased by $1.7 million, or 234%, for the three months ended March 31, 2015 compared to the three months ended March 31, 2014, due to an increase in our headcount and increased consulting expenses. We hired additional personnel in general and administrative functions and engaged external consultants to support revenue growth, improve financial systems and processes, and prepare for the Company’s anticipated initial public offering.

Interest expense and other income (expense), net

	Three Months Ended March 31,				Change
	2014		2015		$			%
	(Dollars in thousands)
Interest and other expense, net:
Interest expense	$	301	$	445	$	144			48	%
Other (income) expense, net		88		38		(50	)		(57	)

Interest expense increased by $0.1 million, or 48%, for the three months ended March 31, 2015 compared to the three months ended March 31, 2014, due to higher interest expense resulting from new borrowings and an increase in our revolving line of credit during the third quarter of fiscal year 2014. Other (income) expense, net, decreased by $0.1 million, or 57%, for the three months ended March 31, 2015 compared to the three months ended March 31, 2014 due to the change of the fair value of our preferred stock warrants and conversion of foreign currencies, partially offset by increased franchise tax charges.

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Provision for income taxes

	Three Months Ended March 31,						Change
	2014			2015			$			%
	(Dollars in thousands)
Provision for (benefit from) income taxes:
Provision for (benefit from) income taxes	$	360		$	(5	)	$	(365	)		(101	)%
Effective tax rate		47.3	%		(0.7	)%		(48	)%		(101	)%

The provision for (benefit from) income taxes was $(0.01) million and $0.4 million for the three months ended March 31, 2015 and 2014, respectively. The effective tax rate was (0.7)% and 47.3% for the three months ended March 31, 2015 and 2014, respectively. The decrease in the provision for income taxes and decrease in the tax rates were primarily due to a higher proportion of our fiscal year 2015 earnings being generated from lower tax rate countries. In 2015, we are completing our transition to having sales to foreign customers conducted by our Bermuda and Malaysia subsidiaries, which have 0% and 25% tax rates, respectively. This results in a decrease in the provision for income taxes and decrease in the tax rates due to a higher proportion of our fiscal year 2015 earnings being generated from these lower tax rate jurisdictions.

Comparison of the Years Ended December 31, 2013 and 2014

Revenues

	Year Ended December 31,										Change
	2013		% of Total Revenues			2014		% of Total Revenues			$			%
	(Dollars in thousands)
Revenues:
Product	$	26,111		88	%	$	65,086		97	%	$	38,975			149	%
Service		3,666		12			2,294		3			(1,372	)		(37	)
Total revenues	$	29,777		100	%	$	67,380		100	%	$	37,603			126	%

Total revenues increased by $37.6 million, or 126%, for 2014 compared to 2013. Product revenues increased by $39.0 million for 2014 compared to 2013, primarily due to an increase in our sales to our two largest customers, due to greater demand from their end customers. Further, service revenues and margin were higher in 2013 compared to 2014, primarily due to eASIC recognizing $0.8 million of revenue (which represented nonrefundable customer payments previously included in deferred revenue) upon cancellation of design services programs by two customers in 2013.

We market and sell our products worldwide. We attribute revenues to the geography based on where customers are billed. Our revenues by geography for the periods indicated were as follows:

	Year Ended December 31,										Change
	2013		% of Total Revenues			2014		% of Total Revenues			$			%
	(Dollars in thousands)
Revenues by geographic region:
United States	$	788		3	%	$	1,302		2	%	$	514			65	%
Rest of Americas		336		1			166		—			(170	)		(51	)
Europe		13,265		44			34,177		51			20,912			158
Asia Pacific		15,388		52			31,735		47			16,347			106
Total revenues	$	29,777		100	%	$	67,380		100	%	$	37,603			126	%

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See Note 9 to our consolidated financial statements for additional information regarding revenues by geography.

Cost of revenues and gross margin

	Year Ended December 31,
	2013					2014
	Amount		Gross Margin			Amount		Gross Margin			Change
	(Dollars in thousands)
Cost of revenues:
Product	$	14,968				$	37,366				$	22,398
Service		748					636					(112	)
Total cost of revenues	$	15,716				$	38,002				$	22,286
Gross margin:
Product				43	%				43	%		—	%
Service				80	%				72	%		(8	)%
Total gross margin				47	%				44	%		(3	)%

Cost of product revenues increased by $22.4 million for 2014 compared to 2013. The increase was primarily related to costs associated with increased product revenues. Cost of service revenues decreased by $0.1 million for 2014 compared to 2013. The decrease was primarily due to lower service revenues.

Total product gross margin remained relatively flat during 2014 compared to 2013. In 2014, our gross margin decreased by 12 percentage points due to declines in the average selling prices of our products. That adverse impact was offset primarily by cost reductions from our supply chain due to higher production volumes. Service revenues margin decreased by eight percentage points in 2014 compared to 2013 primarily due to recognizing $0.8 million of revenue (which represented nonrefundable customer payments previously included in deferred revenues) upon cancellation of design services programs by two customers in 2013.

Operating expenses

	Year Ended December 31,										Change
	2013		% of Total Revenues			2014		% of Total Revenues			$			%
	(Dollars in thousands)
Operating expenses:
Research and development	$	13,026		44	%	$	13,870		21	%	$	844			6	%
Sales and marketing		4,834		16			5,711		8			877			18
General and administrative		3,076		10			5,449		8			2,373			77
Total operating expenses	$	20,936		70	%	$	25,030		37	%	$	4,094			20	%
Includes stock-based compensation of:
Research and development	$	256				$	485				$	229
Sales and marketing		485					286					(199	)
General and administrative		573					558					(15	)
Total	$	1,314				$	1,329				$	15

Research and development. Research and development expense increased by $0.8 million, or 6%, for 2014 compared to 2013. The increase was due to an increase in personnel costs associated with increases in our headcount to support the development of our future products and internal software development tools. We enter into agreements with customers for shared development, under which research and development costs are eligible for reimbursement. Amounts reimbursed under this arrangement are offset against research and development expenses. In connection with such agreements, we offset against research and development expense by an amount of $1.3 million and $1.5 million, for 2013 and 2014, respectively.

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Sales and marketing. Sales and marketing expense increased by $0.9 million, or 18%, for 2014 compared to 2013, due to an increase in personnel costs associated with increases in our headcount in sales and marketing, higher sales commission payments and an increase in marketing programs to support our current revenues and drive future revenue growth.

General and administrative. General and administrative expense increased by $2.4 million, or 77%, for 2014 compared to 2013, as we increased consulting expenses to support revenue growth and improve financial systems and processes.

Interest expense and other income (expense), net

	Year Ended December 31,					Change
	2013			2014		$		%
	(Dollars in thousands)
Interest and other expense, net:
Interest expense	$	935		$	1,443	$	508		54	%
Other (income) expense, net		(12	)		836		848		7,067

Interest expense increased by $0.5 million, or 54%, for 2014 compared to 2013, due to higher interest expense resulting from new borrowings and an increase in our revolving line of credit. Other (income) expense, net increased by $0.8 million, or 7,067%, for 2014 compared to 2013 mainly from foreign exchange losses and the change of the fair value of our preferred stock warrants.

Provision for income taxes

	Year Ended December 31,					Change
	2013		2014			$		%
	(Dollars in thousands)
Provision for income taxes:
Provision for income taxes	$	44	$	3,216		$	3,172		7,209	%
Effective tax rate		—		155.4	%		—		155.4	%

Provision for income taxes increased as our profitability increased. The consolidated effective tax rate for 2014 exceeded the US statutory rate primarily due to taxes associated with certain unrecognized tax benefits related to an intercompany transfer pricing transaction partially offset by foreign income taxed at lower rates.

Capital contribution from/deemed dividend to common stockholders

In December 2012, under a new Certificate of Incorporation and pursuant to the Series A-2 Stock Purchase Agreement, the holders of the Company’s existing preferred stock (Series A through Series H) were offered the right to participate in the $10.0 million financing, on a pro-rata basis. This recapitalization was considered an extinguishment for accounting purposes. The extinguishment resulted in a contribution of capital to the common stock of $83.4 million, which was recorded within the stockholders’ accumulated deficit. The contribution of capital on the extinguishment was included in the adjustment to the Company’s net loss in arriving at the net loss attributable to common stockholders for the year ended December 31, 2012.

In January 2013, the Company completed the initial round of the Series A-2 financing and issued an additional 0.7 million shares of Series A-2 preferred, 0.2 million shares of Series A-1 preferred, and 2.4 million shares of common stock, in exchange for additional cash invested of $3.7 million and 0.3 million shares of Series A, B, C, D, E, F, F-1, G and H preferred stock. This exchange included the exercise of participation rights that had been reallocated from non-participating preferred holders and resulted in a deemed dividend to the preferred stock of $2.6 million related to holders who received reallocated rights and were not employees or service providers. The deemed dividend was charged to common stock and was included in the adjustment to the Company’s net loss in arriving at the net loss attributable to common stockholders for the year ended December 31, 2013.

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Comparison of Years Ended December 31, 2012 and 2013

Revenues

	Year Ended December 31,										Change
	2012		% of Total Revenues			2013		% of Total Revenues			$		%
	(Dollars in thousands)
Revenues:
Product	$	11,843		87	%	$	26,111		88	%	$	14,268		120	%
Service		1,840		13			3,666		12			1,826		99
Total revenues	$	13,683		100	%	$	29,777		100	%	$	16,094		118	%

Total revenues increased by $16.1 million, or 118%, for 2013 compared to 2012. Product revenues increased by $14.3 million for 2013 compared to 2012, primarily due to an increase in sales to our two largest customers, due to greater demand from their end customers. Service revenues increased by $1.8 million for 2013 compared to 2012, primarily due to increased revenues from a higher number of designs and prototype sales.

Our revenues by geography for the periods indicated were as follows:

	Year Ended December 31,										Change
	2012		% of Total Revenues			2013		% of Total Revenues			$			%
	(Dollars in thousands)
Revenues by geographic region:
United States	$	1,199		9	%	$	788		3	%	$	(411	)		(34	)%
Rest of Americas		821		6			336		1			(485	)		(59	)
Europe		6,266		46			13,265		44			6,999			112
Asia Pacific		5,397		39			15,388		52			9,991			185
Total revenues	$	13,683		100	%	$	29,777		100	%	$	16,094			118	%

See Note 9 to our consolidated financial statements for additional information regarding revenues by geography.

Cost of revenues and gross margins

	Year Ended December 31,
	2012					2013
	Amount		Gross Margin			Amount		Gross Margin			Change
	(Dollars in thousands)
Cost of revenues:
Product	$	8,707				$	14,968				$	6,261
Service		373					748					375
Total cost of revenues	$	9,080				$	15,716				$	6,636
Gross margins:
Product				26	%				43	%		17	%
Service				80					80			—
Total gross margins				34					47			13

Cost of product revenues increased by $6.3 million for 2013 as compared to 2012. The increase was primarily related to increased product revenues. Cost of service revenues increased by $0.4 million for 2013 compared to 2012. The increase was primarily related due to higher costs associated with higher service revenues.

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Total product gross margins increased by 17 percentage points in 2013 compared to 2012. In 2013, our gross margins increased primarily due to cost reductions from our supply chain resulting from higher production volumes and favorable product mix contributing 21 percentage points in the aggregate, partially offset by a decline in average selling prices of our products of four percentage points. Service revenues margin remained relatively flat for 2013 compared to 2012.

Operating expenses

	Year Ended December 31,										Change
	2012		% of Total Revenues			2013		% of Total Revenues			$		%
	(Dollars in thousands)
Operating expenses:
Research and development	$	11,898		87	%	$	13,026		44	%	$	1,128		9	%
Sales and marketing		4,494		33			4,834		16			340		8
General and administrative		2,543		19			3,076		10			533		21
Total operating expenses	$	18,935		139	%	$	20,936		70	%	$	2,001		11	%
Includes stock-based compensation of:
Research and development	$	75				$	256				$	181
Sales and marketing		17					485					468
General and administrative		150					573					423
Total	$	242				$	1,314				$	1,072

Research and development. Research and development expense increased by $1.1 million, or 9%, for 2013 compared to 2012, due to an increase in our personnel costs associated with increases in our headcount to support the development of our future products and internal software development tools. We enter into agreements with customers for shared development, under which research and development costs are eligible for reimbursement. Amounts reimbursed under this arrangement are offset against research and development expenses. In connection with such agreements, we offset against research and development expenses an amount of $0.5 million and $1.3 million, for the years ended December 31, 2012 and 2013, respectively.

Sales and marketing. Sales and marketing expense increased by $0.3 million, or 8%, for 2013 compared to 2012, due to an increase in personnel costs associated with increases in our headcount in sales and marketing, higher sales commission payments and an increase in marketing programs to support our current revenues and drive future revenue growth.

General and administrative. General and administrative expense increased by $0.5 million, or 21%, for 2013 compared to 2012, primarily related to stock compensation expense and consulting expenses to support revenue growth and improve financial systems and processes.

Interest expense and other income (expense), net

	Year Ended December 31,						Change
	2012			2013			$			%
	(Dollars in thousands)
Interest and other expense, net:
Interest expense	$	1,042		$	935		$	(107	)		(10	)%
Other (income) expense, net		(72	)		(12	)		60			(83	)

Interest expense decreased primarily due to lower interest expense incurred as a result of payments towards term loans. Other (income) expense, net decreased primarily due to the increase in other expense from a change in the fair value of the preferred stock warrants.

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Provision for income taxes

	Year Ended December 31,				Change
	2012		2013		$			%
	(Dollars in thousands)
Provision for income taxes:
Provision for income taxes	$	57	$	44	$	(13	)		(23	)%
Effective tax rate		—		—		—			—

Tax expense consists principally of foreign taxes, as taxes in the United States are materially offset by usage of net operating loss carryforwards.

Capital contribution from/deemed dividend to common stockholders

In December 2012, under a new Certificate of Incorporation and pursuant to the Series A-2 Stock Purchase Agreement, the holders of the Company’s existing preferred stock (Series A through Series H) were offered the right to participate in the $10.0 million financing, on a pro-rata basis. This recapitalization was considered an extinguishment for accounting purposes. The extinguishment resulted in a contribution of capital to the common stock of $83.4 million, which was recorded within the stockholders’ accumulated deficit. The contribution of capital on the extinguishment was included in the adjustment to the Company’s net loss in arriving at the net loss attributable to common stockholders for the year ended December 31, 2012.

Quarterly Results of Operations

The following tables set forth selected unaudited quarterly consolidated statements of operations data for each of the quarterly periods for fiscal years 2013 and 2014, and the quarter ended March 31, 2015, as well as the percentage that each line item represents of total revenue for each quarter. The information for each of these quarters has been prepared on the same basis as the audited annual consolidated financial statements included elsewhere in this prospectus and, in the opinion of management, includes all adjustments of a normal, recurring nature that are necessary for the fair presentation of the results of operations for these periods in accordance with generally accepted accounting principles in the United States. This data should be read in conjunction with our audited consolidated financial statements and related notes included elsewhere in this prospectus. These quarterly operating results are not necessarily indicative of our operating results for a full fiscal year or any future period.

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	Three Months Ended
	March 31, 2013			June 30, 2013			September 30, 2013			December 31, 2013			March 31, 2014			June 30, 2014			September 30, 2014			December 31, 2014			March 31, 2015
	(In thousands)
Quarterly results of operations:
Revenues:
Product	$	4,202		$	5,295		$	7,364		$	9,250		$	12,265		$	14,411		$	18,946		$	19,464		$	19,658
Service		502			1,035			1,280			849			1,312			184			150			648			417
Total revenues		4,704			6,330			8,644			10,099			13,577			14,595			19,096			20,112			20,075
Cost of revenues:
Product		2,465			2,856			4,408			5,239			7,040			8,857			10,697			10,772			11,178
Service		224			291			105			128			420			93			53			70			190
Total cost of revenues		2,689			3,147			4,513			5,367			7,460			8,950			10,750			10,842			11,368
Gross profit		2,015			3,183			4,131			4,732			6,117			5,645			8,346			9,270			8,707
Operating expenses:
Research and development		3,300			3,164			3,235			3,327			3,038			3,270			3,531			4,031			3,701
Sales and marketing		1,448			1,173			1,064			1,149			1,183			1,447			1,372			1,709			1,331
General and administrative		1,060			664			809			543			746			870			1,598			2,235			2,491
Total operating expenses		5,808			5,001			5,108			5,019			4,967			5,587			6,501			7,975			7,523
Income (loss) from operations		(3,793	)		(1,818	)		(977	)		(287	)		1,150			58			1,845			1,295			1,184
Interest expense		(207	)		(207	)		(230	)		(291	)		(301	)		(301	)		(372	)		(469	)		(445	)
Other income (expense), net		(9	)		(1	)		68			(46	)		(88	)		(40	)		(149	)		(559	)		(38	)
Income (loss) before income taxes		(4,009	)		(2,026	)		(1,139	)		(624	)		761			(283	)		1,324			267			701
Benefit from (provision for) income taxes		(11	)		(11	)		(16	)		(6	)		(360	)		(179	)		(934	)		(1,743	)		5
Net income (loss)	$	(4,020	)	$	(2,037	)	$	(1,155	)	$	(630	)	$	401		$	(462	)	$	390		$	(1,476	)	$	706
	Three Months Ended
	March 31, 2013			June 30, 2013			September 30, 2013			December 31, 2013			March 31, 2014			June 30, 2014			September 30, 2014			December 31, 2014			March 31, 2015
	(As a percentage of total revenues)
Revenues:
Product		89	%		84	%		85	%		92	%		90	%		99	%		99	%		97	%		98	%
Service		11			16			15			8			10			1			1			3			2
Total revenues		100			100			100			100			100			100			100			100			100
Cost of revenues:
Product		52			45			51			52			52			61			56			54			56
Service		5			5			1			1			3			1			—			—			1
Total cost of revenues		57			50			52			53			55			62			56			54			57
Gross profit		43			50			48			47			45			38			44			46			43
Operating expenses:
Research and development		70			50			37			33			22			22			18			20			18
Sales and marketing		31			19			12			11			9			10			7			8			7
General and administrative		23			10			9			5			5			6			8			11			12
Total operating expenses		124			79			58			49			36			38			33			39			37
Income (loss) from operations		(81	)		(29	)		(10	)		(2	)		9			—			11			7			6
Interest expense		(4	)		(3	)		(3	)		(3	)		(2	)		(2	)		(2	)		(2	)		(2	)
Other income (expense), net		—			—			1			—			(1	)		—			(1	)		(3	)		—
Income (loss) before income taxes		(85	)		(32	)		(12	)		(5	)		6			(2	)		8			2			4
Provision for income taxes		—			—			—			—			(3	)		(1	)		(5	)		(9	)		—
Net income (loss)		(85	)%		(32	)%		(12	)%		(5	)%		3	%		(3	)%		3	%		(7	)%		4	%

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Quarterly Revenue Trends

Our quarterly revenue increased year-over-year for all periods presented primarily due to increased sales to our two largest customers. These increased sales were principally due to our customers deploying our solutions into more of their product variants, and additional demand from their end user customers. While we are not aware of any seasonal or cyclical trends that have influenced our business to date, we cannot assure you that our historical growth has not masked any such seasonal or cyclical trends and that, if such trends exist, they might materially impact our financial results at some point in the future. Therefore, historical patterns in our business may not be a reliable indicator of our future sales activity or performance.

Quarterly Gross Margins Trends

Total gross profit increased year-over-year for all periods presented. Our total quarterly gross margins ranged from 38% to 50% during the periods presented. Any fluctuations are primarily due to shifts in the mix of the types and volume of the products sold, pricing and yields from our contract manufacturer and the mix of sales between products and services.

Quarterly Expense Trends

Total operating expenses generally increased year-over-year for all periods presented primarily due to the addition of personnel in connection with the expansion of our business. Research and development expense generally increased year-over-year for all periods presented as we increased our headcount to support the development of our future product and internal software development tools. Despite the increase in headcount, the decrease in research and development expense from the quarter ended March 31, 2013 compared to the quarter ended March 31, 2014 was mainly due to lower engineering projects and test. Sales and marketing expense generally increased year-over-year for all periods presented due to an increase in personnel costs associated with increases in our headcount in sales and marketing, higher sales commission payments and an increase in marketing programs to support our current revenues and drive future revenue growth. The decrease in sales and marketing expense from the quarter ended March 31, 2013 compared to the quarter ended March 31, 2014 was mainly due to incremental stock-compensation expense resulting from the first round of Series A-2 financing which was completed during the quarter ended March 31, 2013. General and administrative expense generally increased year-over-year for all periods presented primarily due to an increase in personnel, legal expense and higher professional services fees for preparing to be a public company. The decrease in general and administrative expense from the quarter ended March 31, 2013 compared to the quarter ended March 31, 2014 was mainly due to incremental stock-compensation expense resulting from the first round of Series A-2 financing which was completed during the quarter ended March 31, 2013.

Internal Control Over Financial Reporting

Prior to this offering we were a private company and have had limited accounting and financial reporting personnel and other resources with which to address our internal controls and procedures. In connection with the audit of our consolidated financial statements as of and for the years ended December 31, 2012 and 2013 and the review of financial statements for the nine months ended September 30, 2014, we identified two material weaknesses in our internal control over financial reporting, as defined in the standards established by the Public Company Accounting Oversight Board of the U.S. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our financial statements will not be prevented or detected on a timely basis. The identified material weaknesses related to (1) our lack of sufficient, qualified personnel in accounting and financial reporting functions with sufficient experience and expertise with respect to the application of U.S. GAAP and related financial reporting, which resulted in a number of post-close adjustments to the consolidated financial statements as of and for the years ended December 31, 2012 and 2013, and (2) our controls for the preparation of the provision for income taxes, resulting principally from the allocation of certain costs from our U.S. parent to one of our foreign subsidiaries which resulted in adjustments to our income tax provision for the nine months ended September 30, 2014.

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Our management and independent registered public accounting firm did not and were not required to perform an evaluation of our internal control over financial reporting as of and for the years ended December 31, 2012, 2013 and 2014 in accordance with the provisions of the JOBS Act.

While we believe that we have put in place additional controls over our accounting close procedures, including hiring additional staff, adding additional reviews and approvals over monthly provisions, including our income tax provision, our remediation efforts are still in process and have not yet been tested. Therefore, we cannot assure you that the material weaknesses in our internal control over financial reporting have been fully remediated as of March 31, 2015. In addition, we cannot be certain that any such measures we undertake will successfully remediate those two material weaknesses or that other material weaknesses and control deficiencies will not be discovered in the future. If our remediation efforts are not successful or other material weaknesses or control deficiencies occur in the future, we may be unable to report our financial results accurately or on a timely basis, which could cause our reported financial results to be materially misstated and result in the loss of investor confidence or delisting and cause the trading price of our common stock to decline. As a result of such failures, we could also become subject to investigations by the stock exchange on which our securities are listed, the SEC, or other regulatory authorities, and become subject to litigation from investors and stockholders, which could harm our reputation, financial condition or divert financial and management resources from our core business. See “Risk Factors—We identified two material weaknesses in our internal controls over financial reporting that, if not properly remediated, could result in material misstatements in our financial statements in future periods and impair our ability to comply with the accounting and reporting requirements applicable to public companies.”

Liquidity and Capital Resources

				As of December 31,						As of March 31,
				2013			2014			2015
				(In thousands)						(Unaudited)
Cash and cash equivalents				$	7,423		$	8,790			$9,222
	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
	(In thousands)									(Unaudited)
Cash flow provided by (used in) operating activities	$	(10,442	)	$	(13,478	)	$	542		$	(74	)	$	1,461
Cash flow used in investing activities		(524	)		(2,129	)		(5,417	)		(1,778	)		(361	)
Cash flow provided by (used in) financing activities		3,228			20,227			6,242			(71	)		(668	)
Net increase (decrease) in cash and cash equivalents	$	(7,738	)	$	4,620		$	1,367		$	(1,923	)	$	432

Primary sources of liquidity. As of December 31, 2013 and 2014 and March 31, 2015, our primary sources of liquidity consisted of cash and cash equivalents of $7.4 million, $8.8 million and $9.2 million, respectively. As of December 31, 2013 and 2014 and March 31, 2015, cash and cash equivalents included $0.5 million, $0.6 million and $0.6 million, respectively, held by our foreign subsidiaries, which we do not currently intend to repatriate. Our borrowings under our revolving line of credit as of December 31, 2013 and 2014 and March 31, 2015 was $5.0 million, $8.0 million and $8.0 million, respectively. As of December 31, 2013 and 2014 and March 31, 2015, our working capital was $15.3 million, $19.6 million and $17.7 million, respectively. We believe we have sufficient cash to meet operational and liquidity needs over the next 12 months.

Historically, our primary sources of liquidity have been from our revolving line of credit and term loans and proceeds from the issuance of preferred and common stock. From inception through March 31, 2015, we issued preferred and common stock with aggregate net proceeds of $129.8 million.

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Cash Flows from Operating Activities

Our primary source of cash from operating activities has been from cash collections from our customers. We expect cash inflows from operating activities to be affected by increases in sales and timing of collections. Our primary uses of cash from operating activities have been for personnel costs and investment in sales and marketing and research and development. We expect cash outflows from operating activities to increase as a result of further investment in sales and marketing and increases in personnel costs as we grow our business.

During the three months ended March 31, 2015, cash provided by operating activities was $1.5 million, primarily from net income of $0.7 million and non-cash charges of $0.8 million, primarily related to stock-based compensation and depreciation and amortization.

During the three months ended March 31, 2014, cash used in operating activities was $0.1 million, primarily from net change in our net operating assets and liabilities of $0.9 million, partially offset by a net income of $0.4 million and non-cash charges of $0.4 million, primarily related to stock-based compensation and depreciation and amortization.

During the year ended December 31, 2014, cash provided by operating activities was $0.6 million, primarily from net loss of $1.1 million, non-cash charges of $3.9 million, primarily related to depreciation and amortization and stock-based compensation, and a net change in our net operating assets and liabilities of $2.2 million. The change in our net operating assets and liabilities was primarily due to a $4.5 million increase in inventory for anticipated growth in our business, a $7.1 million increase in accounts receivable due to an increase in sales, a $3.1 million increase in non-current income taxes payable and a $0.9 million decrease in deferred revenues and other non-current liabilities. These changes were partially offset by a $5.4 million increase in accounts payable primarily attributable to inventory purchases and timing of payments, and a $1.7 million increase in accrued expenses primarily due to timing of payments and increased personnel costs associated with increases in our headcount and consulting expenses to support revenue growth and improve financial systems and processes.

During the year ended December 31, 2013, cash used in operating activities was $13.5 million, primarily from net loss of $7.8 million, non-cash charges of $2.6 million and a net change in our net operating assets and liabilities of $8.3 million. The change in our net operating assets and liabilities was primarily due to a $5.5 million increase in inventory due to inventory purchases, a $3.5 million increase in accounts receivable due to increased sales, a $0.3 million decrease in prepaid expenses and other current assets, a $0.1 million decrease in accrued expenses and other current liabilities and a $0.5 million decrease in deferred revenues due to timing of revenue recognition. This decrease was partially offset by a $1.0 million increase in accounts payable primarily attributable to inventory purchases and timing of payments.

During the year ended December 31, 2012, cash used in operating activities was $10.4 million, primarily from net loss of $15.4 million, non-cash charges of $1.0 million and a net change in our net operating assets and liabilities of $4.0 million. The change in our net operating assets and liabilities was primarily due to a $1.5 million decrease in inventory due to increased sales, a $1.3 million increase in accounts payable due to timing of payments, and a $0.3 million increase in accrued expenses and other current and non-current liabilities due to timing of payments and a $1.0 million increase in deferred revenues due to increased sales. This increase was partially offset by a $0.1 million increase in accounts receivable and prepaid expenses and other current assets.

Cash Flows from Investing Activities

Our investing activities have consisted primarily of purchases of property and equipment, including mask sets. We expect to continue to purchase property and equipment to support continued growth of our business. During the three months ended March 31, 2014 and 2015, cash used in investing activities was $1.8 million and $0.4 million, respectively, due to purchases of property and equipment, primarily mask sets. During the year ended December 31, 2014, cash used in investing activities was $5.4 million, due to purchases of property and

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equipment, primarily mask sets. During the year ended December 31, 2013, cash used in investing activities was $2.1 million, all of which was for property and equipment. During the year ended December 31, 2012, cash used in investing activities was $0.5 million, all of which was for property and equipment.

Cash Flows from Financing Activities

Cash flows from financing activities primarily include net proceeds from issuances of convertible preferred stock, proceeds from the issuance of common stock as a result of the exercise of stock options, and proceeds and payments related to our term loans and revolving line of credit.

During the three months ended March 31, 2015, cash used in financing activities was $0.7 million, mainly due to payment of deferred offering costs.

During the three months ended March 31, 2014, cash used in financing activities was $0.1 million, mainly due to payments on property and equipment acquired through financing arrangements.

During the year ended December 31, 2014, cash provided by financing activities was $6.2 million, mainly from proceeds from our term loans and revolving line of credit.

During the year ended December 31, 2013, cash provided by financing activities was $20.2 million, mainly consisting of $21.7 million in proceeds from our term loans and revolving line of credit, $15.5 million in proceeds from issuance of convertible preferred and common stock, and $1.5 million in proceeds from issuance of bridge notes, offset by $18.1 million in repayments on outstanding term loans and revolving line of credit and $0.4 million in payments on property and equipment acquired through financing arrangement.

During the year ended December 31, 2012, cash provided by financing activities was $3.2 million, mainly consisting of $5.0 million in proceeds from our term loans and revolving line of credit and $6.2 million in proceeds from issuance of convertible preferred and common stock and bridge notes, offset by $7.9 million in repayments on outstanding term loans and revolving line of credit and $0.1 million in payments on property and equipment acquired through financing arrangement.

Debt Obligations

The following is a summary of our debt obligations as of December 31, 2013 and 2014 and March 31, 2015:

	December 31, 2013		December 31, 2014		As of March 31, 2015
					(Unaudited)
	(In thousands)
Term loans	$	5,798	$	8,817	$	8,866
Revolving line of credit		4,950		7,950		7,950
Vendor financing arrangement		1,381		1,280		1,302
Capital lease obligation		—		376		349
	$	12,129	$	18,423	$	18,467

We intend to use approximately $19.0 million of the net proceeds we receive from this offering to prepay the entirety of the outstanding indebtedness, including applicable prepayment penalties, under our debt obligations described in this section titled “—Liquidity and Capital Resources—Debt Obligations.” However, our intentions to prepay our debt may change due to market or other factors.

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Term loans

In September 2010, we entered into a loan and security agreement, as amended at various dates from 2010 to 2014 (collectively, the Amended SVB Agreement), with Silicon Valley Bank (SVB) for a total growth capital loan of $5.0 million and advances under a revolving line of credit up to $8.0 million. The Amended SVB Agreement contains restrictive covenants, including covenants requiring us to meet quarterly gross revenues targets, limiting our ability to sell property, enter into mergers and acquisitions, or raise new debt and containing other restrictions typical of such debt. The Amended SVB Agreement contains usual and customary events of default, such as payment defaults, covenant defaults, investor abandonment, cross-default to material indebtedness and contracts, and insolvency defaults. Our borrowings under the Amended SVB Agreement are secured by a lien granted with respect to substantially all of our assets, excluding intellectual property. The amendment in December 2014 provides for a change in the covenant relating to the maximum amounts that can be held in foreign deposit accounts from $0.25 million to $0.8 million and also for the extension of the maturity date for the revolving line of credit from September 30, 2015 to September 25, 2016.

The $5.0 million growth capital loans were made in two tranches. The first $3.0 million tranche was available immediately upon execution of the Amended SVB Loan Agreement. The second $2.0 million tranche was contingent upon us achieving a certain milestone. Under the terms of the Amended SVB Loan Agreement, we borrowed $3.0 million under the growth capital facility during September 2010 and $2.0 million during January 2011. We paid off all the outstanding balance under the growth capital facility during September 2013.

In April 2011, we entered into a loan and security agreement (GHC Loan Agreement) with Gold Hill Capital 2008 L.P. (GHC) for a total growth capital facility of $3.0 million. Under the terms of the GHC Loan Agreement, we borrowed $3.0 million under the growth capital facility during the year ended December 31, 2011. We paid off all the outstanding balance under the growth capital facility during September 2013.

In September 2013, we entered into a venture loan and security agreement with Horizon Technology Finance Corporation and DBD Credit Funding LLC (Original Horizon Venture Loan Agreement) and immediately borrowed the entire $6.0 million in term loans available under that facility. Our obligations under the Original Horizon Venture Loan Agreement are secured by a lien granted with respect to substantially all of our assets, excluding intellectual property. The Original Horizon Venture Loan Agreement contained usual and customary events of default, such as payment defaults, covenant defaults, material adverse change, investor abandonment, cross-default to material indebtedness, and insolvency defaults. The notes carry a fixed interest rate of 11%, with interest-only payments through and including October 1, 2015 and then equal principal and interest payments for an additional 24 months. In connection with the issuance of the notes, we agreed to make a final payment of $0.15 million upon maturity of the notes, which is being recorded as additional interest expense using the effective interest method over the life of the notes. There are prepayment penalties with respect to the notes. In September 2013, we repaid the outstanding balance of the debts owed to SVB and GHC as discussed above, using the proceeds received from the Original Horizon Venture Loan Agreement.

In September 2014, the Original Horizon Venture Loan Agreement was amended and restated (Amended Horizon Venture Loan Agreement) mainly to make two new term loans available to us, and we immediately borrowed the entire $3.0 million in additional term loans available under the facility. Our borrowings under the Amended Horizon Venture Loan Agreement are secured by a lien granted with respect to substantially all of our assets, excluding intellectual property. The Amended Horizon Venture Loan Agreement prohibits the payment of dividends and contains restrictive covenants, including covenants limiting its ability to sell property, enter into merger and acquisitions, raise new debt, and other restrictions typical of such debt. The Amended Horizon Venture Loan Agreement contains usual and customary events of default, such as payment defaults, covenant defaults, material adverse change, investor abandonment, cross-default to material indebtedness, and insolvency defaults. The notes related to the new term loans carry a fixed interest rate of 10.75%, with interest-only payments through and including October 1, 2015 and then equal principal and interest payments for an additional 30 months. In connection with the issuance of the new term loan notes, we agreed to make a final payment of

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$0.1 million with respect to such term loans, which is being recorded as additional interest expense using the effective interest method over the life of the notes. There are prepayment penalties for the new term notes. In December 2014, the Horizon Venture Loan Agreement was amended to provide for a change in the covenant relating to the maximum amounts that can be held in foreign deposit accounts from $0.25 million to $0.8 million.

Revolving Line of Credit

Under the terms of the Amended SVB Loan Agreement, we are able to borrow up to $8.0 million under the revolving line of credit. The line of credit carries a floating interest rate equal to prime plus 1.5% and matures on September 25, 2016. Borrowings under the line of credit were collateralized by all of our assets, excluding intellectual property, and the availability of borrowings under the line of credit is subject to certain borrowing base limitations. Subject to reduction based upon revenue test, the maximum amount available for borrowing under the revolving line of credit is not to exceed the lesser of $8.0 million or 85% of eligible accounts receivable. The revolving line of credit includes both a material adverse change clause and a lock-box arrangement.

Vendor Financing Arrangement

We have an existing arrangement, as amended, with DNP America LLC (DNP) which provides for the purchase of mask sets to be paid over a period of time based on the actual purchase of additional mask sets over the remaining term of the agreement. The terms of the agreement initially provided for repayment of any unpaid amounts on the purchase of mask sets by December 2010, which date was later extended to December 2012. The terms of the agreement were modified in December 2012 as follows:

(a) The extension to December 2016 for the repayment of any unpaid amounts payable to DNP towards purchases of mask sets by us; and

(b) An increase in the amounts due to DNP by a total of $0.2 million repayable by us at a pre-determined amount at the time of purchases of subsequent mask sets and any unpaid amounts remaining due of the $0.2 million to be paid prior to January 2015.

The modification of the aggregate principal balance due to DNP with a net carrying amount of $1.4 million prior to the December 2012 modification resulted in a troubled debt restructuring accounting treatment under ASC Topic 470-60 where no gain or loss was recognized due to fact that the carrying amount of the debt balance was less than total future cash payments specified by the terms of the debt remaining unsettled after the modification. The net carrying amount due to DNP was $1.4 million, and $1.3 million at December 31, 2013 and 2014, respectively.

In February 2015, the terms of the agreement have been modified as follows:

• The extension to January 2016 of the repayment of the $0.2 million discussed in (b) above repayable by us at a pre-determined amount at the time of purchase of subsequent mask sets to the extent any amounts remaining due of the $0.2 million.

• The extension to January 2017 for the repayment of any unpaid amounts payable to DNP towards purchase of mask sets by us.

The net carrying amount due to DNP was $1.3 million as of March 31, 2015.

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Contractual Obligations and Commitments

The following is a summary of our contractual obligations as of December 31, 2014:

	Total		Less than 1 year		1 to 3 years		3 to 5 years		Over 5 years
	(In thousands)
Operating lease obligations(1)	$	888	$	433	$	455	$	—	$	—
Capital lease obligations(2)		376		121		255		—		—
Time-based software license commitments(3)		4,484		2,521		1,963		—		—
Non-cancellable open purchase orders		3,774		3,774		—		—		—
Vendor financing arrangement(4)		1,280		—		1,280		—		—
Debt maturities(5)		16,767		818		15,949		—		—
Total	$	27,569	$	7,667	$	19,902	$	—	$	—

(1) Operating lease obligations primarily relate to our leases of office space with terms through 2017.

(2) Capital lease obligations relate to the lease of certain data storage equipment with terms through 2017.

(3) Time-based software license commitments represent time-based software license arrangements requiring quarterly payments through 2017.

(4) Payables toward mask set dues represents the unpaid amounts payable to DNP towards purchases of mask sets by us to be settled by January 2017.

(5) Debt maturities represent the outstanding principal balances under our revolving line of credit and term loans.

As of December 31, 2014, we had a $3.1 million liability for uncertain tax positions. This was excluded from the above table due to uncertainty on the timing of payments.

Off-Balance Sheet Arrangements

During the periods presented, we did not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

Segment Information

We have one primary business activity and operate in one reportable segment.

Quantitative and Qualitative Disclosures about Market Risk

Foreign Currency Risk

Our results of operations and cash flows are subject to fluctuations due to changes in foreign currency exchange rates.

Substantially all of our revenues are denominated in U.S. dollars. Our expenses are generally denominated in the currencies in which our operations are located, which is primarily in the United States and to a lesser extent in Europe and Asia. Our results of operations and cash flows are, therefore, subject to fluctuations due to changes in foreign currency exchange rates and may be adversely affected in the future due to changes in foreign exchange rates. The effect of a hypothetical 10% change in foreign currency exchanges rates applicable to our business would not have a material impact on our historical consolidated financial statements.

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Interest Rate Risk

We had cash and cash equivalents of $7.4 million, $8.8 million and $9.2 million as of December 31, 2013 and 2014 and March 31, 2015, respectively, consisting of bank deposits and money market funds. Such interest-earning instruments carry a degree of interest rate risk. To date, fluctuations in interest income have not been significant. We also had total outstanding debt of $12.1 million as of December 31, 2013, none of which was due within 12 months. As of December 31, 2014, we had total outstanding debt of $18.0 million, of which $2.2 million was due within 12 months. As of March 31, 2015, we had total outstanding debt of $18.1 million of which $1.8 million was due within 12 months. The outstanding debt relates to term loans, revolving line of credit and vendor financing arrangement.

We do not enter into investments for trading or speculative purposes and have not used any derivative financial instruments to manage our interest rate risk exposure. We have not been exposed to, nor do we anticipate being exposed to, material risks due to changes in interest rates. Our exposure to interest rates relates to the change in the amounts of interest we must pay on our variable rate borrowings. A hypothetical 10% increase in our borrowing rates would result in an approximately $0.1 million annual increase in interest expense on the existing principal balances.

Concentration

During the year ended December 31, 2014 and three months ended March 31, 2015, we generated revenues from over 14 customers and 10 customers, respectively, including Ericsson, Fujitsu, Huawei, NEC, Omnivision, Seagate and Toshiba. The number of customers varies between different periods due to timing of orders from customers. In 2012, 2013, 2014 and the first three months of 2015, Ericsson and Seagate together accounted for 73%, 87%, 93% and 95%, respectively, of our total revenues. For the three months ended March 31, 2015, Ericsson represented 79% of our total revenues. We currently expect that a relatively small number of customers will continue to account for a significant portion of our revenues for the foreseeable future. However, we believe that based on our existing design wins, our customer concentration will decrease over time. In addition, we believe that, given the market share concentration in our target markets, our customers’ ability to use our platform to provide differentiated products will allow us to expand our market share within our existing customer base and continue to penetrate new customers. We believe this will position us to gain market share within the $78 billion ASIC, ASSP and FPGA markets.

Critical Accounting Policies and Estimates

Our consolidated financial statements have been prepared in accordance with GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances. We evaluate our estimates and assumptions on an ongoing basis. Actual results may differ from these estimates. To the extent that there are material differences between these estimates and our actual results, our future financial statements will be affected.

The critical accounting policies requiring estimates, assumptions and judgments that we believe have the most significant impact on our consolidated financial statements are described below.

Revenue Recognition

We earn revenues from the sale of custom ICs, design and development of ICs for customers and related design services and prototypes. When we enter into an arrangement that includes a design and development phase and a production phase, the production revenues are recognized when production ICs are shipped.

We recognize revenues when there is persuasive evidence of an arrangement, delivery has occurred, the price is fixed or determinable and collectability is reasonably assured. The delivery criterion for each type of product and service is discussed below.

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Product Revenues. Product revenues are generated from sales of our custom ICs. We recognize product revenues at the time of shipment to our customers. A substantial majority of our sales are made on a VMI basis in which we maintain inventory of our product at a hub. Title to that inventory transfers to our customer, and revenues are recognized, when our products are “pulled” from our hub locations or delivered to our customers, as needed to meet their manufacturing requirements. We invoice our customer when this pull transaction occurs. In addition, we sell to non-stocking distributors that sell directly to end-users for which we do not grant return privileges, except for defective products during the warranty period, nor do we grant pricing credits. Accordingly, we recognize revenues upon transfer of title and risk of loss or damage, generally upon shipment.

Service Revenues. We perform design and development services for ICs to a customer’s specifications and apply the proportional performance method based on the achievement of contractual milestones. We have identified the acceptance of the design and prototype delivery as separate elements in the design and development arrangement. The revenues are allocated between such elements based on relative selling price. The selling price for a deliverable is based on its vendor specific evidence of fair value (VSOE) if available; third-party evidence (TPE), if VSOE is not available, or estimated selling prices (ESP), if neither VSOE nor TPE is available. Revenues and the related costs for each of these elements are recognized upon completion of the substantive milestones. If achievement of milestones is subject to customer acceptance, such milestones are not considered achieved until customer acceptance is received. As we have not been able to establish VSOE or TPE for our products and most of our services, we generally utilize Best Estimated Selling Prices (BESP) for the purposes of allocating revenues to each unit of accounting. We limit the amount of revenue recognition for delivered elements to the amount that is not contingent on the future delivery of products or services or future performance obligations and not subject to customer-specific return or refund privileges.

Deferred revenues consists of amounts that have been invoiced relating to product revenues but that have not been recognized as revenues in accordance with our revenue recognition policy. Deferred revenues that will be realized during the succeeding 12 month period are recorded as current, and the remaining deferred revenues are recorded as non-current.

At the inception of the customer arrangement, and at each reporting date thereafter, we estimate the total cost to complete under its arrangements. If at any point of time during the arrangement, we estimate the total cost to complete is higher than the arrangement price, a provision for the entire loss is recorded in the period in which such estimation is made.

We also derive revenues from sale of third party IP solutions. At the request of our customers, we procure third party IP solutions in order for them to port such third party IP solutions on the design of the ICs, the costs of which are then passed through to our customers. The determination of whether revenues should be reported on a gross or net basis is based on our assessment of whether we are acting as the principal or an agent in the transaction. In determining whether we are the principal or an agent, we follow the accounting guidance for principal-agent considerations. When we determine we are not the primary obligor and (i) are not responsible for any development work on such third party IP (ii) do not have any discretion to select the third party IP provider, and (iii) do not have latitude in price setting, then we conclude that we are the agent in these arrangements, and therefore report revenues and cost of revenues on a net basis.

Stock-Based Compensation

Compensation expense related to stock-based transactions, including employee, consultants, and non-employee director stock options, is measured and recognized in the financial statements based on the fair value of the awards granted. The fair value of each option award is estimated on the grant date using the Black-Scholes option-pricing model and a single option award approach. Stock-based compensation expense is recognized, net of forfeitures, over the requisite service periods of the awards, which is generally four years.

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Our use of the Black-Scholes option-pricing model requires the input of highly subjective assumptions, including the fair value of the underlying common stock, the expected term of the option, the expected volatility of the price of our common stock, risk-free interest rates, and the expected dividend yield of our common stock. The assumptions used in our option-pricing model represent management’s best estimates. These estimates involve inherent uncertainties and the application of management’s judgment. If factors change and different assumptions are used, our stock-based compensation expense could be materially different in the future.

These assumptions and estimates are as follows:

• Fair value of common stock. Because our common stock is not yet publicly traded, we must estimate the fair value of common stock, as discussed in “Common Stock Valuations” below.

• Risk-free interest rate. We base the risk-free interest rate used in the Black-Scholes option-pricing model on the implied yield available on U.S. Treasury zero-coupon issues with a remaining term equivalent to that of the options for each option group.

• Expected term. The expected term represents the period that our stock-based awards are expected to be outstanding. We base the expected term assumption on our historical exercise behavior combined with estimates of the post-vesting holding period.

• Volatility. We determine the price volatility factor based on the historical volatilities of our publicly traded peer group as we do not have a trading history for our common stock. Industry peers consist of several public companies in the technology industry that are similar to us in size, stage of life cycle, and financial leverage. We used the same set of peer group companies in all the relevant valuation estimates. We did not rely on implied volatilities of traded options in our industry peers’ common stock because the volume of activity was relatively low. We intend to continue to consistently apply this process using the same or similar public companies until a sufficient amount of historical information regarding the volatility of our own common stock share price becomes available, or unless circumstances change such that the identified companies are no longer similar to us, in which case, more suitable companies whose share prices are publicly available would be utilized in the calculation.

• Dividend yield. We have never declared or paid any cash dividend and do not currently plan to pay a cash dividend in the foreseeable future. Consequently, we used an expected dividend yield of zero.

The following table summarizes the assumptions used in the Black-Scholes option-pricing model to determine the fair value of our stock options as follows:

	Years Ended December 31,						Three Months Ended March 31,
	2012		2013		2014		2014		2015
							(Unaudited)
Fair value per share of common		$0.75		$0.75		$1.28 – $8.83		$1.28		$11.81
Expected volatility		54%		46%		46% – 49%		49%		43%
Expected life in years		6.08		5.77 – 6.08		6.08		6.08		6.08
Risk-free interest rate		1.01% – 1.17%		1.08% – 1.35%		1.78% – 1.93%		1.78%		1.38%
Dividend yield		—		—		—		—		—

In addition to the assumptions used in the Black-Scholes option-pricing model, we must also estimate a forfeiture rate to calculate the stock-based compensation expense for our awards. Our forfeiture rate is based on an analysis of our actual forfeitures and was 15%, 13% and 20% for the years ended December 31, 2012, 2013 and 2014, respectively, and was 20% and 13% for the three months ended March 31, 2014 and 2015. We will continue to evaluate the appropriateness of the forfeiture rate based on actual forfeiture experience, analysis of employee turnover, and other factors. Quarterly changes in the estimated forfeiture rate can have a significant impact on our stock-based compensation expense as the cumulative effect of adjusting the rate is recognized in the period the forfeiture estimate is changed. If a revised forfeiture rate is higher than the previously estimated

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forfeiture rate, an adjustment is made that will result in a decrease to the stock-based compensation expense recognized in the financial statements. If a revised forfeiture rate is lower than the previously estimated forfeiture rate, an adjustment is made that will result in an increase to the stock-based compensation expense recognized in the financial statements.

We will continue to use judgment in evaluating the assumptions related to our stock-based compensation on a prospective basis. As we continue to accumulate additional data related to our common stock, we may have refinements to our estimates, which could materially impact our future stock-based compensation expense.

Common Stock Valuations

We are required to estimate the fair value of the common stock underlying our stock-based awards when performing the fair value calculations with the Black-Scholes option-pricing model. The fair values of the common stock underlying our stock-based awards were determined by our board of directors, with input from management and independent contemporaneous valuations. We believe that our board of directors has the relevant experience and expertise to determine the fair value of our common stock.

Given the absence of a public trading market of our common stock, and in accordance with the American Institute of Certified Public Accountants Practice Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation, our board of directors exercised reasonable judgment and considered numerous objective and subjective factors to determine the best estimate of the fair value of our common stock, including:

• independent contemporaneous valuations;

• the prices, rights, preferences, and privileges of our convertible preferred stock relative to those of our common stock;

• the lack of marketability of our common stock;

• our actual operating and financial performance;

• current business conditions and projections;

• our stage of development;

• the likelihood of achieving a liquidity event, such as an initial public offering of our company given prevailing market conditions;

• the illiquidity of stock-based awards involving securities in a private company;

• the market performance of comparable publicly traded companies; and

• the U.S. and global capital market conditions.

In order to determine the fair value of our common stock underlying option grants, we first determined our business enterprise value (BEV), and then allocated the BEV to each element of our capital structure (preferred stock, common stock, warrants and options). Our BEV was estimated using an income approach.

The income approach estimates the equity value based on the present value of future estimated cash flows. These future cash flows are discounted to their present values using a discount rate, which is derived from an analysis of the cost of capital of comparable publicly traded companies in the same industry or similar lines of business, or guideline companies, as of each valuation date. This weighted-average cost of capital discount rate (WACC), is adjusted to reflect the risks inherent in the business. The WACC used for these valuations was determined to be reasonable and appropriate given our stage of development at the time of each respective valuation. The income approach also assesses the residual value beyond the forecast period utilizing the Gordon Growth Model, capitalizing cash flow in the final year of the projected forecast over the sum of the discount rate less the expected long-term growth rate.

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The market approaches were not relied upon for these valuations. However, the Public Company Market Multiple Method (PCMMM) was used as a reasonableness check. In addition, the PCMMM was utilized in our Probability-Weighted Expected Return Method (PWERM) approach discussed further below.

Our indicated BEV at each valuation date was allocated to the shares of preferred stock, common stock, warrants and options, using either an option pricing method (OPM) or PWERM.

The PWERM approach involves the estimation of future potential outcomes for us, as well as values and probabilities associated with each respective potential outcome. The common stock per share value determined using this approach is ultimately based upon probability-weighted per share values resulting from the various future scenarios, which can include an IPO, merger or sale, dissolution, or continued operation as a private company. The PWERM was determined to be the most appropriate methodology due to our expectations related to a potential liquidity event, as well as management’s ability to estimate probabilities related to identified exit scenarios.

Our equity value in an IPO scenario was estimated by evaluating multiples of the guideline companies’ enterprise values (EV), compared to trailing 12 months (TTM) revenues and/or EBITDA and forward 12 months (FTM) revenues and/or EBITDA. Our equity value in a merger, acquisition, or in a situation in which we would remain private was determined based on the equity value from our income approach, considering the probability-weighted equity value(s) attributable to all applicable IPO scenarios.

When considering which companies to include as our guideline companies, we focused on U.S. based companies in the semiconductor technology industry in which we operate. More specifically, we focused on companies with similar operations and geographic presence, financial size and performance, and stock liquidity.

The PWERM calculates all outstanding common equivalents and in-the-money warrants or options in order to determine the fully diluted shares outstanding of each share class. The expected future value per share is then calculated based on a liquidity event at the equity price determined using the market approach. This price is then discounted to its present value per share. Finally, the expected present value per share for each share class is then probability weighted according to the expectations regarding the respective likelihood of each liquidity event. Starting in February 2014, due to greater clarity on potential exit scenarios, we began using PWERM to allocate our equity value among the various outcomes.

For the scenario in which we remain private, there was a wide range of possible future exit events, so forecasting specific potential values associated with any future events would be highly speculative and imprecise. As such, the equity value determined by the income approach, and adjusted by the probability-weighted equity values of any other exit scenarios, was then allocated to the common stock using the OPM. The OPM treats common stock and convertible preferred stock as call options on a business, with exercise prices based on the liquidation preference of the convertible preferred stock. Therefore, the common stock has value only if the funds available for distribution to the stockholders exceed the value of the liquidation preference at the time of a liquidity event such as a merger, sale or initial public offering, assuming the business has funds available to make a liquidation preference meaningful and collectible by the stockholders. The common stock is modeled to be a call option with a claim on the business at an exercise price equal to the remaining value immediately after the convertible preferred stock is liquidated. The OPM uses the Black-Scholes option-pricing model to price the call option. The OPM is appropriate to use when the range of possible future outcomes is so difficult to predict that forecasts would be highly speculative.

In addition, we also considered an appropriate discount adjustment to recognize the lack of marketability within each valuation due to being a closely held entity.

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Between January 1, 2014 and the date of this prospectus, we granted the following stock options:

Option grant date	Number of shares underlying options		Exercise price per share		Common stock fair value per share(1)
February 2014		148,807	$	0.75	$	1.28
June 2014		331,909		1.50		1.99
August 2014		417,437		2.20		3.28
October 2014		165,931		4.06		6.21 – 7.61
November 2014		27,000		4.06		8.83
January 2015		88,500		11.79		11.81
June 2015		151,735		7.86		7.86

(1) As used for the determination of stock-based compensation expense.

The fair value per share of common stock presented in the table above has been adjusted to reflect the 75-for-1 reverse stock split of shares of common stock effected in 2014.

The following discussion relates primarily to our determination of the fair value per share of our common stock for the purposes of calculating stock-based compensation expenses. No single event caused the valuation of our common stock to increase during each period. Instead, a combination of the factors in each period led to the changes in the fair value of our common stock. Notwithstanding the fair value reassessments described below, we believe we applied a reasonable valuation method to determine the common stock fair values on the respective stock option grant dates.

September 30, 2013 Valuation

Our September 30, 2013 valuation considered an independent contemporaneous valuation prepared on a minority, non-marketable basis. This independent third-party valuation was developed using the income approach, specifically a discounted cash flow analysis, to determine our equity value. The discounted cash flow analysis was developed based on our forecast and utilized a WACC of 40%, which is based upon the expected venture capital rates of return over the life of the company. The OPM was then utilized to allocate value for the scenario in which we remained private and included the following assumptions: a time to a liquidity event of two years, a risk-free rate of 0.35%, a dividend yield of 0%, and a volatility of 46% over the time to a liquidity event. The fair value of our common stock, as determined by our board of directors using the OPM and after applying a non-marketability discount of 19%, was $0.75 per share as of September 30, 2013. Our board of directors set an exercise price of $0.75 per share for the options granted in February 2014, taking into account the independent third-party valuation, as well as the factors discussed above under “Common Stock Valuations.”

March 31, 2014 Valuation

Our March 31, 2014 valuation considered an independent contemporaneous valuation prepared on a minority, non-marketable basis. This independent third-party valuation was developed using the income approach, specifically a discounted cash flow analysis, to determine our equity value. The discounted cash flow analysis was developed based on our forecast and utilized a WACC of 18.5%, which represents a blended rate over the life of the company, considering both the higher-risk explicit forecast period and the lower-risk terminal period. The income approach also assesses the residual value beyond the forecast period utilizing the Gordon Growth Model, capitalizing cash flow in the final year of the projected forecast over the sum of the discount rate less the expected long-term growth rate.

The resulting equity value was then allocated to the common stock utilizing an OPM and the PWERM with two scenarios: (i) an IPO in September 2015 scenario and (ii) a merger/acquisition/stay private scenario. The OPM was utilized to allocate value for the scenario in which we remained private and included the following

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assumptions: a time to a liquidity event of two years, a risk-free rate of 0.44%, a dividend yield of 0%, and a volatility of 45% over the time to a liquidity event. The PWERM was utilized to allocate value in an IPO scenario, and we used an equity value for the IPO based on the PCMMM analysis. The multiples used were EV/TTM Revenue; EV/FTM Revenue; EV/TTM EBITDA; and EV/FTM EBITDA. The probabilities used in the PWERM for the IPO and stay private scenarios were 20% and 80%, respectively. The fair value of our common stock, as determined by our board of directors using the PWERM and after applying a marketability discount of 35%, was $1.50 per share as of March 31, 2014. Our board of directors set an exercise price of $1.50 per share for the options granted in June 2014, taking into account the independent third-party valuation, as well as the factors discussed above under “Common Stock Valuations.”

June 30, 2014 Valuation

Our June 30, 2014 valuation considered an independent contemporaneous valuation prepared on a minority, non-marketable basis. This independent third-party valuation was developed using the income approach, specifically a discounted cash flow analysis, to determine our equity value. The discounted cash flow analysis was developed based on our forecast and utilized a WACC of 17.5%, which represents a blended rate over the life of the company, considering both the higher-risk explicit forecast period and the lower-risk terminal period. The income approach also assesses the residual value beyond the forecast period utilizing the Gordon Growth Model, capitalizing cash flow in the final year of the projected forecast over the sum of the discount rate less the expected long-term growth rate.

The resulting equity value was then allocated to the common stock utilizing an OPM and the PWERM with two scenarios: (i) an IPO in September 2015 scenario and (ii) a merger/acquisition/stay private scenario. The OPM was utilized to allocate value for the scenario in which we remained private and included the following assumptions: a time to a liquidity event of two years, a risk-free rate of 0.47%, a dividend yield of 0%, and a volatility of 44% over the time to a liquidity event. The PWERM was utilized to allocate value in an IPO scenario, and we used an equity value for the IPO based on the PCMMM analysis. The multiples used were EV/TTM Revenue; EV/ FTM Revenue; EV/TTM EBITDA; and EV/FTM EBITDA. The probabilities used in the PWERM for the IPO and stay private scenarios were 25% and 75%, respectively. The fair value of our common stock, as determined by our board of directors using the PWERM and after applying a marketability discount of 35%, was $2.20 per share as of June 30, 2014. Our board of directors set an exercise price of approximately $2.20 per share for the options granted in August 2014, taking into account the independent third-party valuation, as well as the factors discussed above under “Common Stock Valuations.”

The primary reasons for the increase in fair value from the March 31, 2014 valuation to the June 30, 2014 valuation were (i) the decrease in the WACC due to positive changes in our risk profile and improved management expectations for the business and (ii) a 5% increase in the probability of an IPO scenario in the PWERM analysis due to management’s increased expectations related to an IPO.

August 31, 2014 Valuation

Our August 31, 2014 valuation considered an independent contemporaneous valuation prepared on a minority, non-marketable basis. This independent third-party valuation was developed using the income approach, specifically a discounted cash flow analysis, to determine our equity value. The discounted cash flow analysis was developed based on our forecast and utilized a WACC of 17.0%, which represents a blended rate over the life of the Company, considering both the higher-risk explicit forecast period and the lower-risk terminal period. The income approach also assesses the residual value beyond the forecast period utilizing the Gordon Growth Model, capitalizing cash flow in the final year of the projected forecast over the sum of the discount rate less the expected long-term growth rate.

The resulting equity value was then allocated to the common stock utilizing an OPM and the PWERM with three scenarios: (i) and IPO in March 2015 scenario; (ii) an IPO in October 2015; and (iii) a stay private scenario. The OPM was utilized to allocate value for the scenario in which the Company remained private and included the

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following assumptions: a time to a liquidity event of two years, a risk-free rate of 0.48%, a dividend yield of 0%, and a volatility of 44% over the time to a liquidity event. The PWERM was utilized to allocate value in an IPO scenario, and we used an equity value for the IPO based on the PCMMM analysis. The multiples used were EV/TTM Revenue and EV/FTM Revenue. The probabilities used in the PWERM for the March 2015 IPO, the October 2015 IPO, and the stay private scenarios were 15%, 15%, and 70%, respectively. The fair value of our common stock, as determined by our board of directors using the PWERM and after applying a marketability discount of 30%, was $4.06 per share as of August 31, 2014. Our board of directors set an exercise price of $4.06 per share for the options granted in October 2014 and November 2014, taking into account the August independent third-party valuation as well as the factors discussed above under “Common Stock Valuations.”

The primary reasons for the increase in fair value from the June 30, 2014 valuation to the August 31, 2014 valuation were (i) the increase in the selected market multiples in the market approach due to improved expectations for the market and the business; (ii) the slight decrease in the WACC and improved forecast from management due to improved expectations by management; and (iii) a 5% increase in the probability of an IPO scenario in the PWERM analysis due to management’s increased visibility related to an IPO. In addition, the valuation used a lower marketability discount as we neared the expected liquidity events.

November 30, 2014 Valuation

Our November 30, 2014 valuation considered an independent contemporaneous valuation prepared on a minority, non-marketable basis. This independent third-party valuation was developed using the income approach, specifically a discounted cash flow analysis, to determine our equity value. The discounted cash flow analysis was developed based on our forecast and utilized a WACC of 16.5%, which represents a blended rate over the life of the Company, considering both the higher-risk explicit forecast period and the lower-risk terminal period. The income approach also assesses the residual value beyond the forecast period utilizing the Gordon Growth Model, capitalizing cash flow in the final year of the projected forecast over the sum of the discount rate less the expected long-term growth rate.

The resulting equity value was then allocated to the common stock utilizing an OPM and the PWERM with three scenarios: (i) an IPO in March 2015 scenario; (ii) an IPO in October 2015 scenario; and (iii) a stay private scenario. The OPM was utilized to allocate value for the scenario in which the Company remained private and included the following assumptions: a time to a liquidity event of two years, a risk-free rate of 0.47%, a dividend yield of 0%, and a volatility of 43% over the time to a liquidity event. The PWERM was utilized to allocate value in an IPO scenario, and we used an equity value for the IPO based on the PCMMM analysis. The multiples used were EV/FTM Revenue and EV/TTM Revenue. The probabilities used in the PWERM for the March 2015 IPO, the October 2015 IPO, and the stay private scenarios were 40%, 15%, and 45%, respectively. The fair value of our common stock, as determined by our board of directors using the PWERM and after applying a marketability discount of 12.5%, was $9.09 per share as of November 30, 2014, taking into account the independent third-party valuation, as well as the factors discussed above under “Common Stock Valuations.”

The primary reasons for the increase in fair value from the August 31, 2014 valuation to the November 30, 2014 valuation were (i) a new forecast provided by management; (ii) an increase in the expected equity values upon an exit event for both of the IPO scenarios; and (iii) a 25% increase in the probability of an IPO scenario in the PWERM analysis due to management’s increased visibility related to an IPO. In addition, the independent third-party valuation used a lower marketability discount as we neared the expected liquidity events.

December 31, 2014 Valuation

Our December 31, 2014 valuation considered an independent contemporaneous valuation prepared on a minority, non-marketable basis. This independent third-party valuation was developed using the income approach, specifically a discounted cash flow analysis, to determine our equity value. The discounted cash flow analysis was developed based on our forecast and utilized a WACC of 15.0%, which represents a blended rate over the life of the Company, considering both the higher-risk explicit forecast period and the lower-risk terminal

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period. The income approach also assesses the residual value beyond the forecast period utilizing the Gordon Growth Model, capitalizing cash flow in the final year of the projected forecast over the sum of the discount rate less the expected long-term growth rate.

The resulting equity value was then allocated to the common stock utilizing an OPM and the PWERM with three scenarios: (i) an IPO in March 2015 scenario; (ii) an IPO in October 2015 scenario; and (iii) a stay private scenario. The OPM was utilized to allocate value for the scenario in which the Company remained private and included the following assumptions: a time to a liquidity event of two years, a risk-free rate of 0.67%, a dividend yield of 0%, and a volatility of 43% over the time to a liquidity event. The PWERM was utilized to allocate value in an IPO scenario, and we used an equity value for the IPO based on the PCMMM analysis. The multiples used were EV/FTM Revenue and EV/TTM Revenue. The probabilities used in the PWERM for the March 2015 IPO, the October 2015 IPO, and the stay private scenarios were 50%, 25%, and 25%, respectively. The fair value of our common stock, as determined by our board of directors using the PWERM and after applying a marketability discount of 12.5%, was $11.79 per share as of December 31, 2014, taking into account the independent third-party valuation, as well as the factors discussed above under “Common Stock Valuations.” Our board of directors set an exercise price of $11.79 per share for the options granted in January 2015 taking into account the most recent independent third-party valuation prepared at that time as well as the factors discussed above under “Common Stock Valuations.”

The primary reasons for the increase in fair value from the November 30, 2014 valuation to the December 31, 2014 valuation were (i) a decrease in the WACC and (ii) a 20% increase in the probability of an IPO scenario in the PWERM analysis due to management’s increased visibility related to an IPO.

March 31, 2015 Valuation

Our previous common stock valuation was $11.79 as of December 31, 2014. After taking into consideration the current market conditions, our board of directors determined a common stock valuation estimate of $11.96 per share as of March 31, 2015. There has been no single material factor that has influenced the change in the fair value, except passage of time, as the Company gets closer to its anticipated initial public offering.

May 22, 2015 Valuation

Our May 22, 2015 valuation considered an independent contemporaneous valuation prepared on a minority, non-marketable basis. This independent third-party valuation was developed using the income approach, specifically a discounted cash flow analysis, to determine our equity value. The discounted cash flow analysis was developed based on our forecast and utilized a WACC of 14.0%, which represents a blended rate over the life of the Company, considering both the higher-risk explicit forecast period and the lower-risk terminal period. The income approach also assesses the residual value beyond the forecast period utilizing the Gordon Growth Model, capitalizing cash flow in the final year of the projected forecast over the sum of the discount rate less the expected long-term growth rate.

The resulting equity value was then allocated to the common stock utilizing an OPM and the PWERM with three scenarios: (i) an IPO in October 2015 scenario; (ii) an IPO in September 2016 scenario; and (iii) a stay private scenario. The OPM was utilized to allocate value for the scenario in which the Company remained private and included the following assumptions: a time to a liquidity event of two years, a risk-free rate of 0.64%, a dividend yield of 0.0%, and a volatility of 44.0% over the time to a liquidity event. The PWERM was utilized to allocate value in an IPO scenario, and we used an equity value for the IPO based on the PCMMM Analysis. The multiples used were EV/FTM Revenue and EV/TTM Revenue. The probabilities used in the PWERM for the October 2015 IPO, the September 2016 IPO, and the stay private scenarios were 50%, 25%, and 25%, respectively. The fair value of our common stock, as determined by our board of directors using the PWERM and after applying a marketability discount of 15.0%, was $7.86 per share as of May 22, 2015, taking into account the independent third-party valuation, as well as the factors discussed above under “Common Stock Valuations.” Our board of directors set an exercise price of $7.86 per share for the options granted in June 2015 taking into account

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the most recent independent third-party valuation prepared at that time as well as the factors discussed above under “Common Stock Valuations.”

The primary reasons for the decrease in fair value from the prior valuation determined as of March 31, 2015 were (i) a delay in the Company’s IPO timing expectations due to challenges in the capital markets for semiconductor companies; (ii) the Company’s operating performance in light of a slowdown in the semiconductor industry and related demand determinants in the market; and (iii) lower expectations for future IPO values based on market data and feedback.

Repricing of Options

During the year ended December 31, 2013, we repriced a total of 581,285 outstanding options by way of canceling existing outstanding option grants at an exercise price of $2.25 in exchange for new option grants at an exercise price of $0.75. Except for the change in exercise price, the new options had the same terms and conditions as the original options including the contractual term, vesting schedule, and the vesting start date. As a result of such modification, we expensed incremental stock compensation on the date of modification of $0.1 million relating to options that were already vested and another $0.04 million relating to the options that were unvested is expensed over the remaining vesting term of the new options.

During the quarter ended June 30, 2015, we repriced a total of 88,500 outstanding options by way of canceling existing outstanding option grants at an exercise price of $11.79 in exchange for new option grants at an exercise price of $7.86. Except for the change in exercise price, the new options had the same terms and conditions as the original options including the contractual term, vesting schedule, and the vesting start date. As a result of such modification, we expensed incremental stock compensation on the date of modification of $9,000 relating to options that were already vested and another $0.1 million relating to the options that were unvested and will be expensed over the remaining vesting term of the new options.

Property and Equipment

We incur costs for the fabrication of masks to manufacture our products. Our masks include (a) a proprietary standardized base array optimized for a generic application and (b) a custom layer to address a specific application. If we determine the product technological feasibility has been achieved and estimated market demand for products using the tested array exists when costs are incurred, the costs will be capitalized as manufacturing tooling under property and equipment. If product technological feasibility has not been achieved or the mask is not expected to be utilized in production manufacturing, the related mask costs are expensed to research and development when incurred. The amount capitalized will be amortized to cost of sales on a straight-line basis over the estimated life, which is estimated to be eight years for the base mask and three years for the custom layer mask commencing with the start of the commercial production. We periodically reassess the estimated useful lives for specific mask sets capitalized. We also periodically assess capitalized mask costs for impairment.

Income Taxes

We account for income taxes in accordance with ASC Topic 740, Income Taxes, under which deferred tax liabilities and assets are recognized for the expected future tax consequences of temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities and net operating loss and tax credit carryforwards. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

We use a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. A tax position is recognized when it is more likely than not that the tax position will be sustained upon examination, including resolution of any related appeals or litigation processes. A tax position that meets the more-likely-than-not recognition threshold is measured at the largest amount of benefit that is greater than 50% likely of being realized upon ultimate

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settlement with a taxing authority. The standard also provides guidance on derecognition of tax benefits, classification on the balance sheet, interest and penalties, accounting in interim periods, disclosure and transition.

Recent Accounting Pronouncements

In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-03 — Simplifying the Presentation of Debt Issuance Costs, which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This ASU requires retrospective adoption and will be effective for us beginning in our first quarter of 2016. Early adoption is permitted. We do not expect this adoption to have a material impact on our consolidated financial statements.

In August 2014, the FASB issued ASU 2014-15 — Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014-15 requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. In doing so, companies will have reduced diversity in the timing and content of footnote disclosures than under today’s guidance. ASU 2014-15 is effective for us in our 2016 annual financial statements with early adoption permitted. We do not believe the impact of adopting ASU 2014-15 on our consolidated financial statements will be material.

In May 2014, the FASB issued ASU No. 2014-09 regarding ASC Topic 606—Revenue from Contracts with Customers. The standard provides principles for recognizing revenues for the transfer of promised goods or services to customers with the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance is effective for us in the first quarter of fiscal 2017 using either of two methods: (i) retrospective to each prior reporting period presented with the option to elect certain practical expedients as defined within the guidance; or (ii) retrospective with the cumulative effect of initially applying the guidance recognized at the date of initial application and providing certain additional disclosures as defined per the guidance. Early adoption is not permitted. We are currently evaluating the accounting, transition and disclosure requirements of the standard and cannot currently estimate the financial statement impact of adoption.

In July 2013, the FASB issued ASU 2013-11—Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (ASU 2013-11). This standard requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The adoption of ASU 2013-11 did not have a material impact on the consolidated financial statements.

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BUSINESS

Overview

We have pioneered a differentiated solution that enables us to rapidly and cost-effectively deliver custom integrated circuits (ICs), creating value for our customers’ hardware and software systems. Our eASIC solution consists of our eASIC platform which incorporates a versatile, pre-defined and reusable base array and customizable single-mask layer, our ASICs, delivered by using either our easicopy or standard ASIC methodologies, and our proprietary design tools. Customers can efficiently migrate to our easicopy ASIC from the eASIC platform using our easicopy methodology. We believe our eASIC solution provides the optimal combination of fast time-to-market, high performance, low power consumption, low development cost and low unit cost for our customers. Our solution has broad applicability across a wide range of customers, applications and end markets including communications infrastructure, storage and data processing and industrial applications. Our solution should position us to address additional end markets in the future. As of March 31, 2015, we have leveraged our eASIC platform to develop four generations of eASIC products with increasingly smaller process nodes, and we have designed over 200 custom ICs and shipped over 21 million units.

We believe the need for differentiation through custom ICs is driven by several megatrends, including the proliferation of mobile devices driving the deployment of high capacity and high bandwidth wireless infrastructure, the rapid transition to cloud computing and the emergence of big data analytics. We believe the ability to differentiate hardware and software systems through custom ICs is critical to helping our customers grow faster than their competitors and enhance their profit margins. Historical solutions for customized ICs have included Application Specific Integrated Circuits (ASICs), Application Specific Standard Products (ASSPs) and Field Programmable Gate Arrays (FPGAs). We believe our products avoid the painful tradeoffs associated with these historical solutions. For example, based on data provided by a majority of our customers for power consumption with respect to those customers’ designs using FPGAs, as well as our own internal analysis using the latest generation of custom ICs based on our eASIC platform, we believe that we can enable our customers to reduce power consumption by 50% to 80% compared to FPGAs at the same process node. In addition, in all five cases where customers have required that our design provide an increase in performance, as measured by clock speed of the chip, we have been able to improve performance by 60% to 120% compared to FPGAs at the same process node. With our eASIC platform, we believe our customers can significantly reduce non-recurring engineering (NRE) charges and lower design and manufacturing time by nine to 12 months or more when compared to traditional ASIC design and manufacturing processes. We believe our competitive advantages will increase over time as the costs and complexity associated with the development and manufacturing of future generations of ICs continue to rise.

We estimate that our addressable market opportunity across ASIC, ASSP and FPGA applications is approximately $78 billion, based on data from Gartner Research (Gartner). During the year ended December 31, 2014 and the three months ended March 31, 2015, we sold our products and services to over 14 customers and 10 customers, respectively, including Ericsson, Fujitsu, Huawei, NEC, Omnivision, Seagate and Toshiba. The number of customers varies between different periods due to timing of orders from customers. For the years ended December 31, 2013 and 2014 and the three months ended March 31, 2015, our total revenues were $29.8 million, $67.4 million and $20.1 million, respectively, and our net loss was $7.8 million, and $1.1 million in 2013 and 2014, respectively, and net income was $0.7 million for the three months ended March 31, 2015.

Industry Background

Key technology megatrends driving massive growth in the demand for network bandwidth, computing resources and data storage

The proliferation of mobile devices and wireless connectivity, as users are seeking faster access to video content and applications, has driven the demand for wireless network infrastructure. Mobile users expect to be able to connect to high-speed wireless networks from virtually anywhere and at any time. According to the

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Ericsson Mobility Report, global mobile users will grow from 7.1 billion subscriptions in 2014 to 9.5 billion subscriptions in 2020. This growth is largely driven by smartphone adoption, as users increasingly migrate towards faster 3G and 4G (LTE) technologies. According to the same report, mobile data traffic is expected to grow from 3.2 exabytes per month in 2014 to over 25 exabytes per month in 2020, representing a compound annual growth rate (CAGR) of 40% during this period.

The ongoing shift to cloud computing, which allows multiple users to simultaneously execute applications and access data at high speeds, is also creating additional demand for network bandwidth, computing and data storage resources as many enterprise and consumer applications today are delivered as cloud services. The aggregate network bandwidth to support the increased demand for the cloud can be orders of magnitude higher than typical legacy networks. According to International Data Corporation (IDC), storage capacity for cloud deployments (including public and private clouds) is estimated to increase from 68 exabytes in 2014 to 317 exabytes in 2018, representing a CAGR of 47% during this period.

Increasingly, organizations are attempting to capture the value locked in their data to enable more effective application management, IT operations management, security and compliance, and derive intelligence and insight across their organizations. The large and diverse data sets that make up this digital information are often referred to as big data. According to IDC, global data usage is expected to increase from 4.4 trillion gigabytes in 2013 to 44 trillion gigabytes in 2020, a ten-fold increase, representing a CAGR of 39% during this period.

The significant and growing demands on networking, compute and storage infrastructure have resulted in service providers, enterprises and datacenter operators requiring OEMs to rapidly introduce next generation networking, server and storage systems that deliver high return on investment with enhanced functionality and performance, while reducing power consumption and physical footprint.

Historical IC solutions for OEMs

In order to provide semiconductor-based differentiation and customization for their product offerings, OEMs have traditionally had to choose between ASICs, ASSPs and FPGAs. However, these solutions require increasingly painful tradeoffs among time-to-market, performance, power consumption and cost.

An ASIC is a custom IC that is designed and manufactured for one OEM customer to be used in one specific application, and it will often include intellectual property from that OEM or a third party that is embedded into the ASIC. In the past, ASICs represented the most ideal solution for custom ICs since they are capable of offering the highest performance, lowest power and lowest unit production costs. ASIC vendors include Avago, Fujitsu, STMicroelectronics and Toshiba.

An ASSP uses the same design and manufacturing methodology as an ASIC, however, ASSPs are capable of supporting many customers for the same application. While OEMs often combine their own software with an ASSP to differentiate their products, this approach sacrifices performance. Similar to ASICs, ASSPs also offer high performance as well as silicon area and power efficiency. ASSP vendors include Broadcom, Intel, Marvell, MediaTek and Qualcomm.

ASICs and ASSPs both require customization of every mask layer. The need to customize every mask layer leads to long design and manufacturing cycles (typically 21–24 months) and high development cost for design, test and manufacturing setup. The high development cost required is only justified when the return on investment is high enough or the customer can accept the associated tradeoffs. As the costs associated with more complex designs and advanced process nodes have increased over time, these development costs become prohibitive unless the OEMs’ products are sold in sufficient volume to amortize the costs. Further, ASIC and ASSP vendors are unwilling to design them for OEM customers unless they are compensated for significant up-front development costs typically associated with the design.

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Given the challenges in providing ASIC and ASSP solutions, many vendors have either exited the market, consolidated or meaningfully reduced the number of designs they are willing to support. As a result, some of the largest OEMs, such as Amazon, Apple, Cisco, Google and Huawei have created or acquired semiconductor design teams to help them design internal ASICs to add unique value to their products. These in-house design teams, however, face the same financial and technical challenges as the traditional ASIC and ASSP vendors.

Given the cost and time-to-market challenges associated with custom ASICs and ASSPs, FPGAs with software-enabled customization were developed to provide OEMs with a solution that enables them to cost-effectively create a custom IC. FPGAs typically offer low development costs and enable fast time-to-market, but in order to be programmable, they require a significant number of transistors resulting in high unit costs, relatively limited performance and high power consumption. Historically, FPGAs have been the preferred solution for initial market validation, but due to their high unit costs, power consumption and performance limitations, they are not well-suited for high volume production or certain high performance or power efficient applications. Moreover, transitioning from an FPGA to an ASIC design can be time-consuming and expensive. FPGA vendors include Altera, Lattice Semiconductor and Xilinx.

Design costs have risen, creating challenges for OEMs leveraging ASICs

Key technology megatrends are increasing demand for ASICs. However, escalating research, development and design costs associated with the migration to smaller geometry and increasing density of transistors per unit area, are hampering the ability of OEMs to leverage ASICs to address that demand. The following chart shows estimated initial design costs of an IC at various process nodes as reported by International Business Strategies, Inc. (IBS):

Source: IBS, January 2014

Costs per transistor are increasing, creating challenges for historical IC solutions

Historically, advances in manufacturing process technology have enabled engineers to approximately double the number of transistors in the same unit area approximately every 24 months, a trend referred to as Moore’s Law, leading to unit cost benefits. However, as semiconductor process nodes have moved to much smaller geometries, the challenges of patterning and manufacturing semiconductor transistors have reversed the cost reductions associated with Moore’s Law. As a result, semiconductor companies that have traditionally leveraged this unit cost benefit will no longer be able to produce a next generation product where the cost per transistor is lower than their current generation product. Therefore, the justification to use the next generation process node is going to be driven by either performance, power or integration.

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The following chart shows estimated manufacturing cost per 100 million gates at various process nodes, as reported by IBS:

Source: IBS, January 2014

In our view, this point of inflection combined with the escalating design cost is further increasing the need for a new, reliable solution that combines innovation in the design process and IC architecture to cost-effectively deliver customized and differentiated ICs, while minimizing painful tradeoffs in time-to-market, performance, power consumption, development cost and unit cost.

Our Solution

We invented a way to customize ICs while avoiding the painful tradeoffs associated with ASICs, ASSPs and FPGAs. Our eASIC platform incorporates a versatile, pre-defined and reusable base array, which is built using standard mask layers. One custom mask layer is then inserted into the base array, which customizes the IC to meet a specific customer’s requirements. The ability to customize an IC with a single mask layer is achieved using our proprietary architecture and design tools. Once the IC design is completed, the custom mask layer is fabricated and added to the pre-manufactured base array to complete the manufacturing process. The final packaged and tested IC is then shipped to the customer for implementation into their specific application. We believe this approach provides the optimal combination of benefits including fast time-to-market, high performance, low power consumption, low unit cost and low development cost for our customers.

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ASICs, ASSPs and FPGAs consist of approximately 50 individual mask layers in the manufacturing process. In an ASIC or ASSP, the multiple mask layers are fixed, but are customized for the specific customer design or application. The embedded logic, memory and other functions defined by these layers within the IC are fixed once the IC is designed and manufactured. The multiple mask layers of an FPGA are also fixed but are generic and not specific to a customer or application, and the logic, memory and metal interconnect that are defined by these layers are programmable through memory.

Advantages of Our Base Array

Our base arrays have been designed for maximum flexibility, which allows the same base array to be used for multiple applications and by a variety of customers. For example, the same base array has been used for solid-state drives in enterprise storage and for remote radio heads in wireless infrastructure, with the only difference between these two ICs being the single custom mask layer. This flexibility has been created in the base array by designing for versatility, including the layout of the logic and memory blocks and the input/output (I/O) circuitry in the IC. Many elements, such as test logic, clocking structures and power distribution layers that would normally be designed as part of the custom IC flow have been embedded into our base arrays. Because of the high relative performance of the base array, we do not need to pre-layout and “harden” high-speed interface protocol functions in the base array. This ability to use our high speed interfaces to support any industry standard or proprietary high-speed protocol significantly adds to the versatility of our base array.

In addition, we are able to manufacture our base arrays up to the point of the single mask inclusion, which can save up to ten weeks of manufacturing time.

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Advantages of Our Single-Mask Customization

Our highly differentiated technology enables us to use a single mask to customize the entire IC for a unique customer or application, while the rest of the approximately 50 mask layers are common among multiple customers or applications. Our OEM customers are able to express their own IP with a single mask generated by our proprietary design tools. This single custom mask is used to connect the embedded logic and memory in the correct sequence within the base array. We believe that using this single mask approach enables our product platform to provide customers with the optimal combination of fast time-to-market, high performance, low power consumption, low development cost and low unit cost for our customers.

Advantages of Our Proprietary Design Tools

The ability to customize an IC using a single mask and a versatile base array is enabled by our unique and proprietary physical place and route algorithms. These algorithms are the engine of our design tools, which we refer to as eTools, that creates the single mask to customize the base array. We have developed these algorithms and implemented them into our design tools enabling us to deliver a disruptive combination of time-to-market, performance, power and cost. We believe our proprietary eTools, developed and optimized over a number of years across four generations of products, are easy to use, address the various complexities associated with supporting advanced wafer manufacturing process nodes and create significant barriers to entry. The output of the design tools is a data file that is sent to the wafer fabrication facility to manufacture the custom single mask. We offer use of these tools to our customers at no charge. Consequently, the use of expensive electronic design automation (EDA) tools required by ASICs and ASSPs has been greatly minimized using our approach.

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easicopy ASIC and Standard ASIC

When customers design ICs with our eASIC platform, we are able to offer lower unit prices as their production volumes increase. If, at a later point, a customer needs even lower unit pricing, we offer the customer an efficient migration path from the eASIC platform product to an easicopy ASIC, thereby enabling customers to further reduce device cost and power consumption and increase performance. We also have the ability to directly design standard ASICs for our customers without use of our easicopy methodology. We believe we are unique in being able to offer this continuum of custom IC products that can be tailored to a customer’s market requirements.

We offer our customers an efficient migration path using our easicopy methodology to produce a standard ASIC for very high-volume, cost sensitive use cases. This easicopy ASIC is manufactured using the most appropriate process technology from our foundry partners. easicopy can reuse portions of the eASIC platform design, timing and I/O files. In addition, I/O timing and electrical information can be duplicated when migrating from one product to another. When required, we are also able to supply a pin compatible product to reduce the need for system requalification and board redesign. easicopy therefore mitigates the risks normally associated with the design and manufacture of a standard ASIC, often accelerating the time-to-market. Customer supply chain management is made easier by working with a single supplier throughout the migration. For example, one of our customers, Seagate Technology, has leveraged this approach successfully to achieve a leadership position in the hybrid drive market for notebooks and PCs. In an easicopy migration, we charge a NRE and a unit price per IC.

Benefits We Provide Our Customers

Our customers are continuously developing new products in existing and new application areas as they look to differentiate themselves from their competitors, reduce time-to-market, increase market share and enhance margins. In our view, the key benefits of our solutions, as outlined below, help our customers to achieve their goals:

• Product Differentiation Through Custom ICs. Our custom ICs are designed to meet the specific technical requirements of our customers in their respective end-markets while balancing their time-to-market, performance, power consumption and overall cost needs. Our eASIC platform provides our customers with the ability to differentiate their product offerings, and our easicopy methodology provides them with an efficient migration path to a standard ASIC for very high-volume, cost sensitive use cases.

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• Fast Time-to-Market. Our customers compete in markets that require reliable high-performance solutions that can be integrated into their systems expeditiously as new market opportunities develop. Our eASIC platform offers a time-to-market advantage of up to 12 months or more over traditional ASICs. We work closely with our customers to meet their time-to-market requirements through their design cycles and development processes.

• High Performance. Our eASIC platform is designed to meet the high performance requirements that our customers need. We believe that our solution has ASIC-comparable performance that is superior to that offered by FPGAs.

• Low Power Consumption. In most of our end markets, power consumption is a key consideration in system design and operation. Our solution is power-efficient and can considerably lower a system’s overall operating cost and power consumption.

• Low Development Cost. The versatility of our pre-designed base array and the need to customize only one mask layer in our eASIC platform allows us to lower development cost by significantly reducing design and NRE expenses. Having a low development cost allows our solution to be considered for medium volume applications, which have traditionally been cost-prohibitive to address by using ASICs, putting us at a distinct advantage over our ASIC competitors. Combined with our solution’s low per-unit costs, we believe the total cost of ownership for our eASIC platform is highly competitive.

• Low Unit Cost. We are able to design and deliver ICs that have a smaller die size when compared with FPGAs. Due to the area efficient die and lower cost IC packaging, our solution offers an attractive cost per unit relative to FPGAs.

Customer Case Studies

Seagate Case Study:

One example of a customer for whom we successfully created a custom IC solution using our eASIC platform, and later migrated to our easicopy ASIC, is Seagate.

Problem Statement:

We were initially approached by Seagate in 2009, as they had a revolutionary idea of combining NAND FLASH (Solid State Memory) and conventional spinning disks on a drive for PC’s and notebooks. The drive had to meet high performance requirements and be priced effectively to sell into consumer applications. At the same time, the market for these products did not yet exist, so Seagate wanted to avoid the high NRE associated with an ASIC. Seagate also did not want to take the nearly two years typically required to develop an ASIC.

eASIC Solution:

We worked with Seagate on their product requirements and were awarded a design in 2009. Seagate viewed our unique eASIC platform as the only solution to their issue. Therefore, we did not have a direct competitor during this process. We created a custom IC utilizing this platform. Seagate chose our custom IC solution because of our ability to reduce time-to-market while maintaining high performance, low power consumption and low per unit costs. We began a volume ramp in 2010. For a subsequent Seagate product release, we then used our easicopy methodology to efficiently migrate to an easicopy ASIC. This enabled us to deliver a continuum of solutions for very high volume production at a lower unit price in a market where achieving low cost is critical. We have since deepened our customer relationship to support multiple additional Seagate products, which are shipping in mass volume today. For the year ended December 31, 2014 and three months ended March 31, 2015, Seagate accounted for approximately 31% and 16%, respectively, of our revenues.

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Huawei Case Study:

Huawei is an example of a customer that required a combination of high performance, low power and low unit cost, for whom we were able to showcase the multiple benefits of our eASIC platform. Additionally, Huawei is an example of how we benefit from the long product life cycle of our customers in the wireless communications infrastructure market.

Problem Statement:

Huawei faced a very typical customer challenge that required them to develop a new custom IC to overcome the data throughput bottlenecks in the backhaul transport network. These bottlenecks were driven by the increased demand for data throughput and required Huawei to develop a custom IC that required high performance but also meet the total cost of ownership targets set by the global operators. FPGAs were not able to meet the performance, power and cost targets, while the time-to-market requirements could not be met using an ASIC.

eASIC Solution:

Huawei provided us with the key parts of their design that required high performance. We were able to demonstrate the performance advantages and power benefits of our 28nm eASIC Nextreme-3 platform versus equivalent process node FPGAs while meeting Huawei’s requirements. We also presented a schedule that met Huawei’s time-to-market requirements. Huawei awarded the design to us in the second quarter of 2013, we delivered prototypes in the first quarter of 2014. This design is currently in production and is estimated to have a minimum of five years of production life.

Our Growth Strategy

Our objective is to be the leading provider of custom and affordable ICs with fast time-to-market. We believe our solution enables our customers to differentiate their products, become more competitive in their markets and enhance their growth rates, market share and profit margins. Key elements of our strategy include:

• Exploit the Multiple Benefits of our eASIC Platform. We intend to leverage the multiple benefits of our versatile eASIC platform to expand our customer base across a variety of end products. The benefits of our eASIC platform include fast time-to-market, high performance, low power consumption, low development costs and low unit price.

• Expand Market Share within Our Existing Customers. Customers with whom we have now developed supplier relationships are continuously developing new products in existing and new application areas. These customers tend to be large multinational enterprises with large annual purchases of ICs. We target applications and markets with long product life cycles, which leads to extended customer engagements. We intend to increase our market share by applying our differentiated design capabilities to new design programs and by continuing to foster deep customer relationships. We believe this will position us to expand into our customers’ adjacent and next generation products. We believe our product roadmaps will enhance our ability to win new business as these new roadmap features have been developed with inputs from our existing customers. These customers are now using our products to develop their product roadmap plans.

• Sell into New Customers in Existing Markets. We have successfully demonstrated a number of key benefits to top customers within certain applications and markets, such as wireless communications infrastructure and storage. We believe these customers’ products have become more competitive as a direct result of using our solution. We plan to work with other top OEMs in our existing markets to bring the same benefits to them.

• Expand into Adjacent Markets and Enhance Our Product Roadmap to Identify New Use Cases. We have deployed our custom IC solution across a number of different use cases and applications. We

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intend to leverage the versatility of our eASIC platform to develop new use cases and applications. As we deploy new capabilities including but not limited to, higher-speed SerDes, increased logic and memory integration and lower power solutions, we plan to use our eASIC platform to expand into adjacent markets.

• Invest in Key Sales and Technical Talent. Since 2010, our sales strategy has been to focus on key customers within a select set of application areas. As we grow, we intend to build upon our top tier customer base by increasing our geographic sales and technical resources to enable us to expand our market share with new and existing customers and in adjacent markets. We plan to expand our sales and distribution capabilities in select geographic regions.

Our ASIC Design Methodologies

We offer highly integrated ICs that can be customized for a wide variety of customers, applications and end markets. Our design methodologies consist of the following:

• Our eASIC platform consists of our eASIC Nextreme product family, which incorporates a versatile, pre-defined and reusable base array, built using standard mask layers. One custom mask layer is then inserted into the base array, which customizes the IC to meet a specific customer’s requirements.

• Our easicopy ASICs are customized using a full set of custom masks and are developed using our easicopy methodology.

• We also have the ability to directly deliver our ASICs to our customers using standard ASIC methodologies.

Our proprietary design tools, which we refer to as eTools, are used by us and our customers to design a single mask layer for our eASIC Nextreme product family. Our custom ICs are available in 28nm, 45nm and 90nm CMOS processes nodes. The following table shows the key product lines and features:

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We believe our eASIC Nextreme family enables our customers to reduce power consumption by 50% to 80% and in some case also increase performance by 60% to 120% compared to FPGAs at the same process node. These products are significantly smaller in device size relative to a FPGA, which often results in substantial unit cost savings.

We believe our eASIC Nextreme family enables our customers to significantly reduce design time against traditional ASIC, resulting in up to more than a year of time saved in the design cycle. This family requires only one mask for customization which reduces the NRE cost from multiple millions of dollars to low hundreds of thousand of dollars.

We use our easicopy methodology to provide our customers with an efficient migration path from the eASIC Nextreme product to an easicopy ASIC, as well as to directly design such ASICs, thereby enabling customers to further reduce device cost and power consumption and increase performance.

Some of our customers begin their design using an FPGA and switch to us to reduce power consumption, enhance performance and reduce costs. We then validate our customer’s product design and provide a device that is a “drop-in-replacement” of the FPGA. This allows our customers to replace an FPGA from any vendor without the need to create a new printed circuit board. We also offer our customers related design services.

Partnering with us helps ensure that our customers have low risk cost reduction solutions along the spectrum from pre-production to very high volume production. easicopy provides OEMs with a low risk, vital addition to their existing value engineering programs. OEMs can be confident that as their product succeeds in the market, they have a clear path to cost reduction.

Our Customers

We sell our products primarily to top-tier OEMs in our target markets. During the year ended December 31, 2014 and the three months ended March 31, 2015, we generated revenues from over 14 customers and 10 customers, respectively, including Ericsson, Fujitsu, Huawei, NEC, Omnivision, Seagate and Toshiba. The number of customers varies between different periods due to timing of orders from customers. In 2012, 2013 and 2014 and the first three months of 2015, Ericsson and Seagate, our two largest customers, together accounted for 73%, 87%, 93% and 95%, respectively, of our total revenues. We currently expect that a relatively small number of customers will continue to account for a significant portion of our revenues for the foreseeable future. However, we believe that based on our existing design wins, our customer concentration will decrease over time. In addition, we believe that, given the market share concentration in our target markets, our customers’ ability to use our platform to provide differentiated products will allow us to expand our market share within our existing customer base and penetrate new customers. We believe this will position us to gain market share within the $78 billion ASIC, ASSP and FPGA markets.

Sales and Marketing

We use a three stage engagement process with our top tier OEM customers. This consists of the following:

• Phase 1—Awareness and Evaluation. During this phase, we introduce our products to the potential customer. The goal in the awareness phase is to make the potential customer aware of eASIC. In the evaluation phase, we demonstrate the capabilities and value of our products. We also share detailed concepts of how our product brings value to our customer’s specific application. At the output of this phase, the customer provides us with a request for quote.

• Phase 2—Initial Design Award. If the results of Phase 1 are positive, then we move to Phase 2. This phase consists of our customer awarding us with an initial design purchase order for design services and prototypes, recognizing the value provided by our products. During this phase, we also implement the customers’ design and provide prototypes. Our customers evaluate the prototypes and place orders for production units.

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• Phase 3—Customer Acquired. We continue to build a deep technical relationship with our customers’ system architects and engineers. This allows our customers to share their specific technical requirements for further designs. This usually results in multiple design awards. Our customers also share their future technical requirements, which we use to enhance our future products.

We work directly with our customers’ system designers to create demand for our products by providing them with application-specific product information for their system design, engineering and procurement groups. Our technical marketing, sales and field application engineers actively engage with customers during their vendor selection and design processes and provide them with our product capabilities and target applications. We design products to meet the increasingly complex and specific design requirements of our customers. Our typical sales engagement cycle is several months. If successful, this process culminates in a customer decision to use our product in their system, which we refer to as a design award. Typically, volume production begins from nine months to 18 months after the design award. Once one of our products is incorporated into a customer’s design, it is likely to be used for the life cycle of the customer’s product, because a redesign would be time consuming and expensive. We benefit from our deep engagement with our customers by being well-positioned to replace their maturing products and expand into adjacent products.

For select direct customers that represent a significant portion of our revenues, we maintain inventory of our product at a customer specified location (known as Vendor Managed Inventory, or VMI) and are notified when our products are either ordered or “pulled” by our customers to meet their manufacturing needs. We own and have access to the inventory, until such inventory is “pulled” by the customer, at which time the customer takes title to that inventory, we invoice the customer and recognize revenues. This VMI structure allows our customers the flexibility to modify their manufacturing volumes without being affected by the long production lead times typically required of custom ICs and provides us with enhanced insights into our customers’ supply needs.

Manufacturing

We use third-party foundries, assembly and test contractors to manufacture, assemble and test our ICs. This outsourced manufacturing approach is a capital efficient model that allows us to focus our resources on the design, sales and marketing of our platform solutions. Our engineers work closely with our foundries and other contractors to increase yields, lower manufacturing costs and improve quality.

Integrated Circuit Fabrication. Our ICs are fabricated using CMOS processes, which provide greater flexibility to engage independent foundries to manufacture our ICs. By outsourcing manufacturing, we are able to avoid the cost associated with owning and operating our own manufacturing facility. We currently outsource our IC manufacturing to Fujitsu, Global Foundries and Taiwan Semiconductor Manufacturing Company. We work closely with these foundries by forecasting our manufacturing capacity requirements on a monthly basis. Our ICs are currently fabricated in several advanced, sub-micron manufacturing processes. Because advanced manufacturing processes lead to enhanced performance, smaller size and lower power requirements, we continually evaluate the benefits and feasibility of migrating to smaller geometry process technology in order to reduce cost and improve performance.

Assembly and Test. Our products are shipped from our third-party foundries to third-party assembly and test facilities where they are assembled, packaged and tested. We outsource all product packaging and substantially all testing requirements for these products to several assembly and test subcontractors, including ASE Electronics in Taiwan and Malaysia, as well as Amkor in the United States. Our products are designed to use standard packages and to be tested with widely available test equipment.

Quality Assurance. We have implemented significant quality assurance and test procedures to assure high levels of product quality for our customers. Our designs are subjected to extensive circuit simulation under extreme conditions of temperature, voltage and processing before being committed to manufacture. We have

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completed and have been awarded ISO 9001:2008 certification. In addition, all of our independent foundries and assembly and test subcontractors have been awarded certifications including ISO 9001, TS16949 and ISO 14001.

Research and Development

Our research and development efforts are directed largely to the development of our fifth generation product focused on further increasing performance, lowering unit cost and lowering power consumption. We are also focused on integrating more system functions such as high performance single and multi-core processors and greater SerDes capabilities.

We have assembled a core team of experienced engineers and systems designers, including consultants, in four design centers located in the United States, Malaysia, Romania and Russia. As of March 31, 2015, we had 67 employees in our research and development group. Our technical team typically has, on average, more than 20 years of industry experience with more than 34% having advanced degrees and more than 7% having PhDs. These engineers and designers are involved in advancing our core technologies, as well as applying these core technologies to our product development activities across a number of areas. In 2012, 2013 and 2014 and the three months ended March 31, 2015, our research and development expenses were $11.9 million, $13.0 million, $13.9 million and $3.7 million, respectively.

On May 8, 2015, we entered into a non-binding Memorandum of Understanding (“MOU”) with Intel Corporation, whereby we mutually agreed to explore certain aspects of our eASIC tools and technology to determine if that technology could be incorporated into Intel’s process technology with some future Intel products. On June 21, 2015, we and Intel entered into a binding agreement (“Agreement”), under which Intel agreed to pay us a one-time payment for certain technical assessments on the feasibility of porting certain eASIC tools and technology to an Intel process technology. In the second quarter of 2015, we recognized $650,000 in revenue associated with the completion of the milestones associated with the technical assessment under the Agreement, and no further milestones or deliverable remain outstanding under the Agreement.

To date, we have not entered into any further agreements associated with the Agreement, and there are no material obligations under the Agreement for us or Intel. We continue to work with Intel to explore potential commercial arrangements based on the technical assessments, but can provide no assurance that we will enter into any such future agreements or that we will derive any material revenue, or economic benefit from Intel.

Patent and Licenses

To protect our core technology and intellectual property, we rely on a combination of intellectual property rights, including patents, trade secrets, copyrights and trademarks and contractual protections. As of March 31, 2015, we had 35 issued and four pending patent applications in the United States. We also have a number of foreign counterparts of these patents and patent applications, consisting of 16 granted patents and two pending applications in the Japanese and European Patent Offices. Our issued patents expire between March 11, 2019 and January 12, 2033. As of March 31, 2015, we also had registered trademarks in the United States for eASIC, easicopy, eASICore, The Configurable Logic Company and eZ-IP. We have patented our proprietary base array, built using a single mask layer. This proprietary technology is critical to our ability to offer our solution to customers that want to avoid many of the potential tradeoffs, such as slow time to market, that occur with ASICs that have many more custom layers that are required to be built in. We are not currently aware of any other companies that can offer the same level of customization without significantly more costly mask layers. Accordingly, we believe that this patented technology represents a significant barrier to entry for potential competitors.

Our patent applications may not result in the issuance of any patents, and our issued patents may not provide us with any competitive advantages. In addition, any future patent may be opposed, contested, circumvented, designed around by a third party or found to be unenforceable or invalidated. Others may develop technologies

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that are similar or superior to our proprietary technologies, duplicate our proprietary technologies or design around patents owned or licensed by us.

In addition, we generally control access to and use of our proprietary software and other confidential information through the use of internal and external controls, including contractual protections with employees, contractors, customers and partners. We rely in part on U.S. and international copyright laws to protect our software. All employees and consultants are required to execute confidentiality agreements in connection with their employment and consulting relationships with us. We also require them to agree to disclose and assign to us all inventions conceived or made in connection with the employment or consulting relationship.

Despite our efforts to protect our intellectual property, unauthorized parties may still copy or otherwise obtain and use our software, technology or other information that we regard as proprietary intellectual property.

While we currently possess perpetual licenses on the intellectual property that we build into our products, we may be required in the future to seek additional licenses under patents or intellectual property rights owned by third parties. However, we cannot be certain that third parties will offer licenses to us or that the terms of any licenses offered to us will be acceptable. In addition, any intellectual property litigation could cause us to incur substantial expenses, materially and adversely affect our sales and divert the efforts of our technical and management personnel, regardless of the outcome of any such litigation. In the event we receive an adverse result in any litigation, we could be required to pay substantial damages, cease sale of products, expend significant resources to develop alternative technology and discontinue the use of processes requiring the relevant technology.

Competition

We compete with numerous domestic and international semiconductor companies. We consider our primary competitors to be other companies that can provide custom semiconductor solutions, including Altera, Avago, Broadcom, Marvell, Toshiba and Xilinx. Most of these competitors offer products that differ in the semiconductor device customization method.

The principal competitive factors in our market include:

• defining, designing and regularly introducing new products that anticipate the functionality and integration needs of our customers’ next-generation products and applications;

• building strong and long-lasting relationships with our customers and other industry participants;

• our research and development capabilities to provide innovative solutions and maintain our product roadmap;

• the strength of our sales and marketing efforts;

• brand awareness and reputation;

• focusing on customer support;

• retaining high-level talent, including our management team and engineers; and

• protecting our IP.

We believe we compete favorably with our competitors on the basis of these factors. However, many of our competitors have greater financial and other resources with which to pursue marketing, technology development, product design, manufacturing, quality, sales and distribution of their products.

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Employees

As of June 30, 2015, we had 107 full-time employees located in the United States, Malaysia, Japan and Romania, which was comprised of 68 employees in engineering, research and development, 14 in sales and marketing, 18 in general and administrative and seven in operations. None of our employees is represented by a labor union and we consider our employee relations to be good.

Facilities

Our principal executive offices are located in a leased facility in Santa Clara, California, consisting of approximately 18,526 square feet of office space. We entered into a Lease Surrender and Termination Agreement in connection with this leased facility as of July 14, 2015, under which we executed a new lease agreement. We plan to move from our current leased facility in Santa Clara to a new leased facility, also in Santa Clara, by October 2015. The new lease expires in five years and consists of approximately 22,500 square feet of office space. Our current and future facilities both accommodate product design and our principal software engineering, sales, marketing, operations and finance and administrative activities. Our offices in Malaysia are located in a leased facility in Penang, consisting of approximately 8,585 square feet total of office space under two leases that expire at the end of July 2017, and end of September 2017. This facility accommodates engineering, operations, customer engineering and administrative teams. Our offices in Romania are located at a leased facility in Brasov, consisting of approximately 2,950 square feet of office space under a lease that expires at the beginning of March 1, 2017. This facility accommodates customer engineering, engineering and administrative teams. We do not own any real property. We believe that our leased facilities are adequate to meet our current needs and that additional facilities are available for lease to meet future needs.

Legal Proceedings

From time to time, we may become involved in legal proceedings arising in the ordinary course of our business. We are not currently a party to any legal proceedings the outcome of which, if determined adversely to us, would individually or in the aggregate have a material adverse effect on our business, operating results, financial condition or cash flows.

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MANAGEMENT

Executive Officers and Directors

The following table sets forth information regarding our executive officers and directors as of August 1, 2015:

Name	Age		Position(s)
Executive Officers
Ronnie Vasishta		52	President, Chief Executive Officer and Director
Richard J. Deranleau		57	Chief Financial Officer and Senior Vice President, Finance
Ranko Scepanovic, Ph.D.		61	Chief Technology Officer and Senior Vice President, Engineering
Jasbinder Bhoot		51	Vice President, Worldwide Marketing and Acting Vice President, Worldwide Sales
Matthew Ng		47	Vice President, Legal, General Counsel and Corporate Secretary
Non-Employee Directors
Wayne Cantwell(1)(2)		50	Director
Edward H. Frank, Ph.D.(2)(3)		58	Director
Ronald S. Jankov(1)(3)		56	Director
Tara Long(2)		48	Director

(1) Member of the audit committee.

(2) Member of the compensation committee.

(3) Member of the nominating and corporate governance committee.

Executive Officers

Ronnie Vasishta has served as our Chief Executive Officer since May 2009 and as a member of our board of directors since May 2005. From December 2004 to May 2009, Mr. Vasishta served in a number of positions at the Company, including Vice President of Marketing, Chief Executive Officer, President and Chief Operating Officer. From February 2001 to November 2004, Mr. Vasishta served as Vice President of Technology Marketing at LSI Corporation, an electronics company. Mr. Vasishta holds a B.S. in Electrical and Electronic Engineering from Trent University. Our board of directors believes that Mr. Vasishta’s extensive experience in marketing, manufacturing, design and operational management in the semiconductor field and his long-standing services in various management positions at the Company qualify him to serve on our board of directors.

Richard J. Deranleau has served as our Chief Financial Officer and Senior Vice President, Finance since June 2014. From January 2012 to June 2014, Mr. Deranleau served as Senior Vice President, Finance and Chief Financial Officer at Fujitsu America Inc., an information technology products and services company. From January 2006 to May 2011, Mr. Deranleau served as Vice President Finance and Chief Financial Officer at Brocade Communications Systems, Inc., an information technology company. Mr. Deranleau holds a B.S. in Economics from Iowa State University and an M.B.A. from San Jose State University.

Ranko Scepanovic, Ph.D. has served as our Chief Technology Officer and Senior Vice President, Engineering since February 2011. From May 2008 to January 2011, Dr. Scepanovic served as our Senior Vice President of Advanced Technology. From October 1997 to May 2008, Dr. Scepanovic served as Vice President of the Advanced Development Group at LSI Corporation, an electronics company. Dr. Scepanovic holds a Ph.D. in Mathematical Sciences from the University of Belgrade.

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Jasbinder Bhoot has served as our Vice President, Worldwide Marketing since April 2009. In addition, Mr. Bhoot has been our Acting Vice President, Worldwide Sales since July 2015. From October 2005 to April 2009, Mr. Bhoot served as our Senior Director of Intellectual Property Marketing. From November 1999 to October 2005, Mr. Bhoot served as Senior Manager of Vertical Marketing at Xilinx Inc., a technology company. Mr. Bhoot holds a B.S.Eng in Electronic Engineering from the University of Westminster and an M.B.A. from the University of Nottingham.

Matthew Ng has served as our Vice President, Legal, General Counsel and Corporate Secretary since January 2015. From April 2012 until January 2015, Mr. Ng served as Senior Director, Legal at Brocade Communications, and as its acting Senior Director, Legal from October 2011 until April 2012. From July 2007 until October 2011, Mr. Ng served as an Axiom Attorney at Axiom Global, a legal services company. Mr. Ng previously held Associate General Counsel positions at Oracle Corporation and Knight-Ridder, Inc. Mr. Ng holds a B.S. in Business Administration and a J.D. from the University of California, Berkeley.

Non-Employee Directors

Wayne Cantwell has served as a member of our board of directors since July 2005. Since 2003, Mr. Cantwell has served as a General Partner at Crescendo Ventures, a venture capital firm, where he works with companies in the semiconductor, SIP and technical software arenas. From 1999 to January 2001, Mr. Cantwell served as President and Chief Executive Officer of inSilicon Corporation, a semiconductor intellectual property company. Mr. Cantwell holds a B.S. in Electronics Engineering from Devry Institute of Technology. We believe Mr. Cantwell’s extensive experience in the semiconductor and software industries qualifies him to serve on our board of directors.

Edward H. Frank, Ph.D. has served as a member of our board of directors since October 2013. From January 2014 to present, Dr. Frank has served as Chief Executive Officer of Cloud Parity, a mobile application company. From May 2009 to October 2013, Dr. Frank served as Vice President of Macintosh Hardware Systems Engineering at Apple, Inc., an electronics and software company. From May 1999 to March 2008, Dr. Frank served as Vice President of Research and Development at Broadcom Corporation, a broadband communications company, and in a consultant capacity from April 2008 to April 2009. Since June 1996, Dr. Frank has served as a Technology Partner at Advanced Technology Ventures, a venture capital firm. Dr. Frank holds an M.S. and B.S. in Electrical Engineering from Stanford University and a Ph.D. in Computer Science from Carnegie Mellon University where he has served as a Trustee since July 2000. Dr. Frank currently serves on the board of directors of Analog Devices, Inc. We believe Dr. Frank’s technical and design expertise in the semiconductor industry qualifies him to serve on our board of directors.

Ronald S. Jankov has served as a member of our board of directors since August 2014. From February 2012 to May 2014, Mr. Jankov served as Senior Vice President and General Manager, Processors and Wireless Infrastructure of Broadcom Corporation, a semiconductor company. From 2000 to 2012, Mr. Jankov served as President, Chief Executive Officer and Director of NetLogic Microsystems, Inc., a semiconductor company. Mr. Jankov also serves on the board of directors of Knowles Electronics Corp., a technology company. Mr. Jankov holds a B.S. in Physics from Arizona State University. We believe Mr. Jankov’s leadership experience and background in facilitating the growth of technical companies qualify him to serve on our board of directors.

Tara Long has served as a member of our board of directors since June 2013. Since February 2006, Ms. Long has served as Vice President of Strategy and Corporate Development at Seagate, a data storage company. From September 2001 to December 2005, Ms. Long served as Managing Director at MCG Capital Corporation, a commercial finance company. Ms. Long also previously served as Managing Director at C.E. Unterberg Towbin, an investment banking firm. Ms. Long holds a B.A. in Economics from Marquette University and an M.B.A from the University of Maryland. We believe Ms. Long’s experience in corporate strategy, together with her historical perspective on the company, qualify her to serve on our board of directors.

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Board Composition

Our business and affairs are organized under the direction of our board of directors, which currently consists of six members. The primary responsibilities of our board of directors are to provide oversight, strategic guidance, counseling and direction to our management. Our board of directors meets on a regular basis and additionally as required. The current composition of our board of directors is dictated by our voting agreement, although this agreement will terminate upon the completion of this offering.

Our board of directors has determined that all of our directors, except Mr. Vasishta and                     , are independent directors, as defined under the listing standards of the NASDAQ Stock Market LLC (NASDAQ).

In accordance with the terms of our amended and restated certificate of incorporation and bylaws, which will be effective immediately prior to consummation of this offering, our board of directors will be divided into three classes, Class I, Class II and Class III, with members of each class serving staggered three-year terms.

Effective upon the completion of this offering, our board of directors will be comprised of the following classes:

• Class I, which will consist of                      and Tara Long, whose terms will expire at our annual meeting of stockholders to be held in 2016;

• Class II, which will consist of Wayne Cantwell and Edward H. Frank, Ph.D., and whose terms will expire at our annual meeting of stockholders to be held in 2017; and

• Class III, which will consist of Ronnie Vasishta and Ronald S. Jankov, and whose terms will expire at our annual meeting of stockholders to be held in 2018.

At each annual meeting of stockholders to be held after the initial classification, the successors to directors whose terms then expire will serve until the third annual meeting following their election and until their successors are duly elected and qualified. The authorized size of our board of directors is currently eight members. The authorized number of directors may be changed only by resolution by a majority of the board of directors. This classification of the board of directors may have the effect of delaying or preventing changes in our control or management. Our directors may be removed for cause by the affirmative vote of the holders of at least 66 2/3% of our voting stock.

Role of the Board in Risk Oversight/Risk Committee

One of the key functions of our board of directors is informed oversight of our risk management process. Our board of directors does not have a standing risk management committee, but rather administers this oversight function directly through the board of directors as a whole, as well as through various standing committees of our board of directors that address risks inherent in their respective areas of oversight. In particular, our board of directors is responsible for monitoring and assessing strategic risk exposure and our audit committee has the responsibility to consider and discuss our major financial risk exposures and the steps our management has taken to monitor and control these exposures, including guidelines and policies to govern the process by which risk assessment and management is undertaken. The audit committee also monitors compliance with legal and regulatory requirements. Our compensation committee assesses and monitors whether any of our compensation policies and programs has the potential to encourage excessive risk-taking.

Board Committees

Our board of directors has established an audit committee, a compensation committee and a nominating and corporate governance committee. Our board of directors has adopted a charter for each of these committees, which complies with the applicable requirements of current NASDAQ rules. We intend to comply with future requirements to the extent they are applicable to us. Following the completion of this offering, copies of the charters for each committee will be available on the investor relations portion of our website.

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Audit Committee

Our audit committee consists of Wayne Cantwell,                                  and Ronald S. Jankov. Under Rule 10A-3 under the Securities Exchange Act of 1934, as amended, or the Exchange Act, we are permitted to phase in our compliance with the independent audit committee requirements set forth in NASDAQ Marketplace Rule 5605(c) and Rule 10A-3 under the Exchange Act. Our board of directors has determined that each of Messrs. Jankov and Cantwell are independent directors under the NASDAQ Listing Rules and under Rule 10A-3 under the Exchange Act. Each member of our audit committee can read and understand fundamental financial statements in accordance with NASDAQ audit committee requirements. In arriving at this determination, the board has examined each audit committee member’s scope of experience and the nature of their prior and/or current employment.

Ronald S. Jankov serves as the chair of our audit committee. Our board of directors has determined that each of Messrs. Jankov, Cantwell and                  qualifies as an audit committee financial expert within the meaning of SEC regulations and meets the financial sophistication requirements of the NASDAQ Listing Rules. In making this determination, our board has considered each of Messrs. Jankov, Cantwell and                  formal education and previous and current experience in financial roles. Both our independent registered public accounting firm and management periodically meet privately with our audit committee.

The functions of this committee include, among other things:

• evaluating the performance, independence and qualifications of our independent auditors and determining whether to retain our existing independent auditors or engage new independent auditors;

• reviewing our financial reporting processes and disclosure controls;

• reviewing and approving the engagement of our independent auditors to perform audit services and any permissible non-audit services;

• reviewing the adequacy and effectiveness of our internal control policies and procedures, including the responsibilities, budget, staffing and effectiveness of our internal audit function;

• reviewing with the independent auditors the annual audit plan, including the scope of audit activities and all critical accounting policies and practices to be used by us;

• obtaining and reviewing at least annually a report by our independent auditors describing the independent auditors’ internal quality control procedures and any material issues raised by the most recent internal quality-control review;

• monitoring the rotation of partners of our independent auditors on our engagement team as required by law;

• prior to engagement of any independent auditor, and at least annually thereafter, reviewing relationships that may reasonably be thought to bear on their independence, and assessing and otherwise taking the appropriate action to oversee the independence of our independent auditor;

• reviewing our annual and quarterly financial statements and reports, including the disclosures contained under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and discussing the statements and reports with our independent auditors and management;

• reviewing with our independent auditors and management significant issues that arise regarding accounting principles and financial statement presentation and matters concerning the scope, adequacy and effectiveness of our financial controls and critical accounting policies;

• reviewing with management and our auditors any earnings announcements and other public announcements regarding material developments;

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• reviewing and approving the selection and activities, organization structure and qualifications of any internal audit function;

• establishing procedures for the receipt, retention and treatment of complaints received by us regarding financial controls, accounting or auditing matters and other matters;

• preparing the report that the SEC requires in our annual proxy statement;

• reviewing and providing oversight of any related person transactions in accordance with our related person transaction policy and reviewing and monitoring compliance with legal and regulatory responsibilities, including our code of ethics;

• reviewing our major financial risk exposures, including the guidelines and policies to govern the process by which risk assessment and risk management is implemented;

• reviewing on a periodic basis our cash investment policy; and

• reviewing and evaluating on an annual basis the performance of the audit committee and the audit committee charter.

We believe that the composition and functioning of our audit committee complies with all applicable requirements of the Sarbanes-Oxley Act, and all applicable SEC and NASDAQ rules and regulations. We intend to comply with future requirements to the extent they become applicable to us.

Compensation Committee

Our compensation committee consists of Wayne Cantwell, Edward H. Frank, Ph.D. and Tara Long. Mr. Cantwell serves as the chair of our compensation committee. Our board of directors has determined that each of the members of our compensation committee is a non-employee director, as defined in Rule 16b-3 promulgated under the Securities Exchange Act of 1934, or the Exchange Act, is an outside director, as defined pursuant to Section 162(m) of the Internal Revenue Code of 1986, as amended (Code), and satisfies the NASDAQ independence requirements. The functions of this committee include, among other things:

• reviewing and approving the corporate objectives that pertain to the determination of executive compensation;

• reviewing and approving the compensation and other terms of employment of our executive officers;

• evaluating the competitiveness of our overall compensation plan;

• reviewing and approving performance goals and objectives relevant to the compensation of our executive officers and assessing their performance against these goals and objectives;

• making recommendations to the board of directors regarding the adoption or amendment of equity and cash incentive plans and approving amendments to such plans to the extent authorized by the board of directors;

• reviewing and approving the type and amount of compensation to be paid or awarded to our non-employee board members;

• reviewing and assessing the independence of compensation consultants, legal counsel and other advisors as required by Section 10C of the Exchange Act;

• administering our equity incentive plans;

• reviewing and approving the terms of any employment agreements, severance arrangements, change in control protections, indemnification agreements and any other material arrangements for our executive officers;

• reviewing with management our disclosures under the caption “Executive and Director Compensation” in our periodic reports or proxy statements to be filed with the SEC, to the extent such caption is included in any such report or proxy statement;

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• preparing an annual report on executive compensation that the SEC requires in our annual proxy statement; and

• reviewing and evaluating on an annual basis the performance of the compensation committee and recommending such changes as deemed necessary with the board of directors.

We believe that the composition and functioning of our compensation committee complies with all applicable requirements of the Sarbanes-Oxley Act, and all applicable SEC and NASDAQ rules and regulations. We intend to comply with future requirements to the extent they become applicable to us.

Nominating and Corporate Governance Committee

Our nominating and corporate governance committee consists of Edward H. Frank, Ph.D., Ronald S. Jankov and                             . Under NASDAQ Marketplace Rule 5615(b)(1), we are permitted to phase in our compliance with the independent nominating and corporate governance committee requirements set forth in NASDAQ Marketplace Rule 5605(e). Our board of directors has determined that each of Dr. Frank and Mr. Jankov are independent directors under the NASDAQ Listing Rules. Mr.                  serves as the chair of our nominating and corporate governance committee. The functions of this committee include, among other things:

• identifying, reviewing and making recommendations of candidates to serve on our board of directors;

• evaluating the performance of our board of directors, committees of our board of directors, and individual directors and determining whether continued service on our board is appropriate;

• evaluating nominations by stockholders of candidates for election to our board of directors;

• evaluating the current size, composition and organization of our board of directors and its committees and making recommendations to the board of directors for approvals;

• developing a set of corporate governance policies and principles and recommending to our board of directors any changes to such policies and principles;

• reviewing issues and developments related to corporate governance and identifying and bringing to the attention of our board of directors current and emerging corporate governance trends; and

• reviewing periodically the nominating and corporate governance committee charter, structure, membership requirements and recommending any proposed changes to our board of directors; including undertaking an annual review of its own performance.

We believe that the composition and functioning of our nominating and corporate governance committee complies with all applicable requirements of the Sarbanes-Oxley Act, and all applicable SEC and NASDAQ rules and regulations. We intend to comply with future requirements to the extent they become applicable to us.

Compensation Committee Interlocks and Insider Participation

None of the members of our compensation committee has ever been an executive officer or employee of ours. None of our executive officers currently serves, or has served during the last completed fiscal year, on the compensation committee or board of directors of any other entity that has one or more executive officers serving as a member of our board of directors or compensation committee.

Limitation on Liability and Indemnification of Directors and Officers

Our amended and restated certificate of incorporation, which will be effective immediately prior to consummation of this offering, limits our directors’ liability to the fullest extent permitted under Delaware

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corporate law. Delaware corporate law provides that directors of a corporation will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except for liability:

• for any transaction from which the director derives an improper personal benefit;

• for any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

• under Section 174 of the Delaware General Corporation Law (unlawful payment of dividends or redemption of shares); or

• for any breach of a director’s duty of loyalty to the corporation or its stockholders.

If the Delaware General Corporation Law is amended to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of our directors shall be eliminated or limited to the fullest extent permitted by the Delaware General Corporation Law, as so amended.

Delaware corporate law and our amended and restated bylaws provide that we will, in certain situations, indemnify our directors and officers and may indemnify other employees and other agents, to the fullest extent permitted by law. Any indemnified person is also entitled, subject to certain limitations, to advancement, direct payment or reimbursement of reasonable expenses (including attorneys’ fees and disbursements) in advance of the final disposition of the proceeding.

In addition, we have entered, and intend to continue to enter, into separate indemnification agreements with our directors and officers. These agreements, among other things, require us to indemnify our directors and officers for certain expenses, including attorneys’ fees, judgments, fines and settlement amounts incurred by a director or officer in any action or proceeding arising out of their services as one of our directors or officers or any other company or enterprise to which the person provides services at our request.

We maintain a directors’ and officers’ insurance policy pursuant to which our directors and officers are insured against liability for actions taken in their capacities as directors and officers. We believe that these provisions in our amended and restated certificate of incorporation and amended bylaws and these indemnification agreements are necessary to attract and retain qualified persons as directors and officers.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or control persons, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

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EXECUTIVE AND DIRECTOR COMPENSATION

Our named executive officers for the year ended December 31, 2014, which consists of our principal executive officer and our two other most highly compensated executive officers, are:

• Ronnie Vasishta, our President and Chief Executive Officer;

• Richard J. Deranleau, our Senior Vice President, Finance and Chief Financial Officer; and

• Ranko Scepanovic, Ph.D., our Chief Technology Officer and Senior Vice President, Engineering.

Summary Compensation Table

Name and Principal Position	Year		Salary			Option Awards(1)			Bonus			Non-Equity Incentive Plan Compensation		All Other Compensation		Total
Ronnie Vasishta		2014	$	293,750	(2)	$	13,906	(3)		—		$	62,059		—	$	369,715
President and Chief Executive Officer		2013		275,000			182,206			—			—		—		457,206
Richard J. Deranleau		2014		123,442	(4)		202,874		$	24,500	(5)		—		—		350,816
Senior Vice President, Finance and Chief Financial Officer		2013		—			—			—			—		—		—
Ranko Scepanovic, Ph.D.		2014		260,312	(6)		—			—			45,134		—		305,446
Chief Technology Officer and Senior Vice President, Engineering		2013		250,000			101,240			50,000			—		—		401,240

(1) In accordance with SEC rules, this column reflects the aggregate grant date fair value of the option awards granted during 2014 computed in accordance with Financial Accounting Standard Board Accounting Standards Codification Topic 718 for stock-based compensation transactions (FASB ASC Topic 718). Assumptions used in the calculation of these amounts are included in Note 6 to our audited financial statements included elsewhere in this prospectus. These amounts do not reflect the actual economic value that will be realized by the named executive officer upon the vesting of the stock options, the exercise of the stock options, or the sale of the common stock underlying such stock options.

(2) Effective April 2014, Mr. Vasishta’s annual base salary was increased from $275,000 to $300,000.

(3) Represents the aggregate incremental fair value calculated in accordance with FASB ASC Topic 718 in connection with an option amendment, effective May 2014, to vest 50% of the shares of common stock subject to an outstanding option covering 16,381 shares that was granted to Mr. Vasishta in October 2010.

(4) Mr. Deranleau’s employment commenced in June 2014.

(5) Represents Mr. Deranleau’s annual bonus which, per the terms of his offer letter agreement, is guaranteed to be paid from the commencement of his employment through the earlier of (i) three months following the lock-up expiration of an initial public offering of our stock or (ii) the closing of the sale of the majority or greater of our stock.

(6) Effective April 2014, Dr. Scepanovic’s annual base salary was increased from $250,000 to $263,750.

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Annual Base Salary

The compensation of our named executive officers is generally determined and approved by our board of directors, based on the recommendation of the compensation committee of our board of directors. The following 2014 base salaries were effective as of April 2014:

Name	2014 Base Salary
Ronnie Vasishta	$	300,000
Richard J. Deranleau(1)		245,000
Ranko Scepanovic, Ph.D		263,750

(1) Mr. Deranleau’s employment commenced in June 2014.

Equity-Based Incentive Awards

Our equity-based incentive awards are designed to align our interests with those of our employees and consultants, including our named executive officers. Our board of directors is responsible for approving equity grants. Vesting of equity awards is generally tied to continuous service with us and serves as an additional retention measure. Our executives generally are awarded an initial new hire grant upon commencement of employment. Additional grants may occur periodically in order to specifically incentivize executives with respect to achieving certain corporate goals or to reward executives for exceptional performance.

All outstanding equity awards held by our current employees, consultants and directors were granted pursuant to the 2010 Plan, the terms of which are described below under “—Equity Benefit Plans.” All options are granted with a per share exercise price equal to no less than the fair market value of a share of our common stock on the date of the grant of such award. Generally our stock option awards vest over a four-year period subject to the holder’s continuous service to us and may be granted with an early exercise feature.

Effective May 2014, our board of directors vested 50% of the shares of common stock subject to an outstanding option covering 16,381 shares that was granted to Mr. Vasishta in October 2010. Absent this amendment, vesting of that portion of the option would have remained contingent on the satisfaction of certain performance thresholds established at the time of grant.

Bonus/Non-Equity Incentive Plan Compensation

Objectives for our named executive officers’ 2014 performance bonuses included gains over the course of the year in our revenue, gross margins, operating income and “design win”-based revenue results. Named executive officers’ target awards ranged from 40%-50% of base salary for accomplishment of all objectives, with escalators applicable in case of exceeded objectives.

In February 2015, our compensation committee approved a bonus program for the cash incentive bonuses for certain of our eligible executives, including our named executive officers for 2015. This program provides for bonus payments based upon the attainment of performance targets established by the compensation committee and related to financial and operational measures or objectives with respect to the company. These performance goals include revenue, gross margins, operating income and “design-win”-based revenue results. Target awards for executive officers range from 30%-68% of base salary for accomplishment of all objectives, with accelerators applicable in case of exceeded objectives. The performance goals will be measured at the end of fiscal 2015 after our financial reports have been published or such other appropriate time as the compensation committee determines. As a standing bonus program, the determination of payouts, if any, or any adjustments thereto, remain at the discretion of our compensation committee.

Agreements with our Named Executive Officers

Below are descriptions of our employment agreements and offer letter agreements with our named executive officers. The agreements generally provide for at-will employment and set forth the named executive officer’s

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initial base salary and eligibility for employee benefits and, in Mr. Vasishta’s and Mr. Deranleau’s cases, severance benefits upon a qualifying termination of employment. Furthermore, each of our named executive officers has executed a form of our standard proprietary information and inventions assignment agreement. The key terms of the employment agreements with our named executive officers are described below.

Amended and Restated Employment Agreement with Mr. Vasishta

On October 15, 2010, we entered into an amended and restated employment agreement with Mr. Vasishta, our President and Chief Executive Officer, which superseded and replaced Mr. Vasishta’s previous employment agreement. The amended and restated employment agreement sets forth Mr. Vasishta’s initial annual base salary (originally $250,000) and eligibility to participate in our employee benefit plans and programs, as in effect from time to time. The agreement also provides for an annual performance bonus of up to $100,000 based on the assessment by our board of directors of Mr. Vasishta’s performance and the attainment of annual targeted company goals set forth by our board of directors in their sole discretion. Under Mr. Vasishta’s agreement, we also agreed to grant an option to purchase 78,101 shares of common stock at an exercise price equal to fair market value on the date of grant. This option is fully vested and exercisable.

The agreement further provides for the following severance benefits payable in the event of Mr. Vasishta’s involuntary termination by the company without cause, or his termination for good reason, until he commences employment or a full-time consulting relationship with another company or employer, subject to Mr. Vasishta signing a general release in favor of the company, and agreeing to seek diligently a new position of comparable responsibility and compensation: (a) continuation of Mr. Vasishta’s base salary in effect as of the employment termination date for up to nine months after such termination, plus (b) subject to certain qualifications, payment of COBRA premiums to continue health insurance coverage for Mr. Vasishta and his eligible dependents for a period up to nine months following Mr. Vasishta’s termination date. The foregoing severance and/or acceleration provisions have since been superseded and replaced, as described below in the section entitled “Change in Control and Severance Agreements.”

Agreement with Mr. Deranleau

We entered into a letter agreement with Mr. Deranleau, dated April 28, 2014, under which Mr. Deranleau was hired as our Senior Vice President, Finance and Chief Financial Officer. The letter agreement provides that Mr. Deranleau is an at-will employee and sets forth his annual base salary of $245,000 and his eligibility to participate in our employee benefit plans and programs, as in effect from time to time. Under Mr. Deranleau letter agreement, we granted Mr. Deranleau stock options to purchase 193,048 shares of common stock. The options were granted with an exercise price per share equal to the fair market value of our common stock on the date of grant and 25% of the shares underlying the option vested on the one year anniversary of the vesting commencement date (his initial date of employment) and thereafter 1/48th of the shares vested each month, subject to Mr. Deranleau’s continued employment with us on each applicable vesting date.

Additionally, all unvested options are subject to acceleration of vesting in the event of Mr. Deranleau’s (i) involuntary termination by the Company without cause, or (ii) voluntary termination for good reason, in either case occurring after a change in control but not later than 12 months following a change in control, and subject to Mr. Deranleau signing a release in favor of the company. The foregoing severance and/or acceleration provisions have since been superseded and replaced, as described below in the section entitled “Change in Control and Severance Agreements.” Mr. Deranleau’s letter agreement also provides for an annual bonus targeted at 40% of Mr. Deranleau’s annual salary, based on metrics tied to our overall performance as determined by our board of directors, provided that Mr. Deranleau’s bonus is guaranteed to be paid from the commencement of his employment through the earlier of (i) three months following the lock-up expiration of an initial public offering of our stock or (ii) the closing of the sale of the majority or greater of our stock.

Agreement with Dr. Scepanovic

We entered into a letter agreement with Dr. Scepanovic, dated April 29, 2008, under which Dr. Scepanovic was hired as our Senior Vice President of Advanced Technology. The letter agreement provides that

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Dr. Scepanovic is an at-will employee and sets forth his annual base salary of $250,000 and his eligibility to participate in our employee benefit plans and programs, as in effect from time to time. Under Dr. Scepanovic’s letter agreement, we granted Dr. Scepanovic stock options to purchase 19,314 shares of common stock. The options were granted with an exercise price per share equal to the fair market value of our common stock on the date of grant.

Additionally, Dr. Scepanovic’s letter agreement provides that in the event of Dr. Scepanovic’s (i) involuntary termination by the Company without cause or (ii) voluntary termination for good reason, in either case occurring after a change in control but not later than 12 months following a change in control, and subject to Dr. Scepanovic signing a release in favor of the company, 50% of the then-unvested shares subject to the option shall vest. The option is fully vested and exercisable. The foregoing severance and/or acceleration provisions have since been superseded and replaced, as described below in the section entitled “Change in Control and Severance Agreements.”

Potential Payments Upon Termination or Change of Control

Change in Control and Severance Agreements

In July 2015, our board of directors approved a form of change in control and severance agreement to be entered into with each of our executive officers and certain other employees and on July 31, 2015, we entered into these agreements with each of our named executive officers.

The executive agreement with each executive officer provides that if such officer is terminated for any reason other than cause, death or disability, such officer would be entitled to receive the following severance benefits:

Agreement with Mr. Vashista:

• a lump sum payment equal to 12 months of Mr. Vashista’s then-current base salary;

• a lump sum payment equal to 100% of Mr. Vashista’s then-current annual target bonus;

• reimbursement of COBRA premiums for Mr. Vashista and his eligible dependents, if any, for a period of up to 12 months; and

• 50% acceleration of vesting of all then-unvested equity awards held by Mr. Vashista.

Agreement with Mr. Deranleau and Dr. Scepanovic:

• a lump sum payment equal to six months of such officer’s then-current base salary;

• a lump sum payment equal to 50% of such officer’s then-current annual target bonus; and

• reimbursement of COBRA premiums for such officer and his eligible dependents, if any, for a period of up to six months.

Agreement with Mr. Vashista, Mr. Deranleau and Dr. Scepanovic:

In addition, the change in control and severance agreement for each officer provides that if such officer is terminated for any reason other than cause, death or disability or the officer voluntarily resigns for good reason, within three months prior to (and contingent upon the consummation of the change in control) or 12 months after a change in control, each officer would be entitled to receive the following severance benefits:

• a lump sum payment equal to 12 months of such officer’s then-current base salary;

• a lump sum payment equal to 100% of such officer’s then-current annual target bonus;

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• reimbursement of COBRA premiums for such officer and his eligible dependents, if any, for a period of up to 12 months; and

• 100% acceleration of vesting of all then-unvested equity awards held by such officer.

Payment of any severance benefits is conditioned on the executive officer’s timely execution of a general release of claims in our favor.

Outstanding Equity Awards at Fiscal Year-End

The following table sets forth certain information regarding equity awards granted to our named executive officers that remain outstanding as of December 31, 2014:

			Option Awards(1)
	Grant Date		Number of Securities Underlying Unexercised Options (#) Exercisable			Number of securities underlying unexercised options (#) unexercisable		Option exercise price per share ($)(2)		Option expiration date
Ronnie Vasishta		4/4/2006		10,666				$	0.75		04/04/16
		4/4/2006		10,187			—	$	0.75		04/04/16
		2/6/2007		10,094			—	$	0.75		02/06/17
		12/4/2007		3,172			—	$	0.75		12/04/17
		12/4/2007		9,245			—	$	0.75		12/04/17
		2/5/2008		1,583			—	$	0.75		02/05/18
		10/5/2010		16,381			—	$	0.75		10/05/20
		10/5/2010		27,392			—	$	0.75		10/05/20
		10/5/2010		34,328			—	$	0.75		10/05/20
		10/4/2011		33,086	(3)(6)		—	$	0.75		10/04/21
		8/23/2013		406,535	(4)(6)		—	$	0.75		08/23/23
		8/23/2013		133,333	(4)(6)		—	$	0.75		08/23/23
Richard J. Deranleau		8/5/2014		45,506	(5)(6)		—	$	2.1975		08/05/24
		8/5/2014		147,542	(5)(6)		—	$	2.1975		08/05/24
Ranko Scepanovic, Ph.D.		6/2/2008		13,253			—	$	0.75		06/02/18
		6/2/2008		6,060			—	$	0.75		06/02/18
		10/5/2010		12,521			—	$	0.75		10/05/20
		2/1/2011		8,205			—	$	0.75		02/01/21
		2/1/2011		8,205			—	$	0.75		02/01/21
		2/1/2011		8,205			—	$	0.75		02/01/21
		2/1/2011		9,195	(3)(6)		—	$	0.75		02/01/21
		10/4/2011		9,859	(3)(6)		—	$	0.75		10/04/21
		10/4/2011		10,631	(3)(6)		—	$	0.75		10/04/21
		8/23/2013		166,636	(4)(6)		—	$	0.75		08/23/23
		8/23/2013		133,333	(4)(6)		—	$	0.75		08/23/23

(1) All of the option awards were granted under the 2010 plan, the terms of which plans are described below under “—Equity Benefit Plans.”

(2) All of the option awards were granted with a per share exercise price equal to the fair market value of one share of our common stock on the date of grant, as determined in good faith by our board of directors.

(3) 1/60th of the shares subject to the option vest monthly over five years. The shares subject to the options are exercisable prior to vesting.

(4) 50% of the shares vested on the date of grants with the remaining shares vesting monthly over two years. The shares subject to the options are exercisable prior to vesting.

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(5) 1/48th of the shares subject to the option vest monthly over four years. The shares subject to the options are exercisable prior to vesting.

(6) In the event of optionholder’s (i) involuntary termination by the Company without cause or (ii) voluntary termination for good reason in either case occurring after a change in control but not later than 12 months following a change in control, and subject to optionholder signing a release in favor of the Company, all unvested shares subject to the option shall accelerate in full.

Health, Welfare and Retirement Benefits

All of our current named executive officers are eligible to participate in our employee benefit plans, including our medical, dental and vision insurance plans, in each case on the same basis as all of our other employees. We do not contribute to a retirement plan on behalf of employees.

Nonqualified Deferred Compensation

None of our named executive officers participate in or have account balances in nonqualified defined contribution plans or other nonqualified deferred compensation plans maintained by us. Our board of directors may elect to provide our officers and other employees with nonqualified defined contribution or other nonqualified deferred compensation benefits in the future if it determines that doing so is in our best interests.

Equity Benefit Plans

2015 Equity Incentive Plan

Our board of directors adopted our 2015 Equity Incentive Plan (2015 plan) in February 2015 and our stockholders approved the 2015 plan in March 2015, which will become effective upon the execution and delivery of the underwriting agreement related to this offering. Once the 2015 plan is effective, no further grants will be made under the 2010 plan.

Stock Awards. The 2015 plan provides for the grant of incentive stock options, or ISOs, nonstatutory stock options, or NSOs, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance-based stock awards, and other forms of equity compensation, or collectively, stock awards, all of which may be granted to employees, including officers, non-employee directors and consultants of us and our affiliates. Additionally, the 2015 plan provides for the grant of performance cash awards. ISOs may be granted only to employees. All other awards may be granted to employees, including officers, and to non-employee directors and consultants.

Share Reserve. Initially, the aggregate number of shares of our common stock that may be issued pursuant to stock awards under the 2015 plan after the 2015 plan becomes effective is the sum of (1) 2,650,000 shares, plus (2) the number of shares (not to exceed 3,668,317 shares) (i) reserved for issuance under our 2010 plan at the time our 2015 plan becomes effective, and (ii) any shares subject to outstanding stock options or other stock awards that were granted under our 2010 plan that are forfeited, terminate, expire or are otherwise not issued. Additionally, the number of shares of our common stock reserved for issuance under our 2015 plan will automatically increase on January 1 of each year, beginning on January 1, 2016 (assuming the 2015 plan becomes effective before such date) and continuing through and including January 1, 2025, by 5% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our board of directors. The maximum number of shares of our common stock that may be issued upon the exercise of ISOs under our 2015 plan is 31,000,000 shares.

No person may be granted stock awards covering more than 2,000,000 shares of our common stock under our 2015 plan during any calendar year pursuant to stock options, stock appreciation rights and other stock awards whose value is determined by reference to an increase over an exercise or strike price of at least 100% of

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the fair market value on the date the stock award is granted. Additionally, no person may be granted in a calendar year a performance stock award covering more than 2,000,000 shares of our common stock or a performance cash award having a maximum value in excess of $2,000,000. Such limitations are designed to help assure that any deductions to which we would otherwise be entitled with respect to such awards will not be subject to the $1,000,000 limitation on the income tax deductibility of compensation paid to any covered executive officer imposed by Section 162(m) of the Code.

If a stock award granted under the 2015 plan expires or otherwise terminates without being exercised in full, or is settled in cash, the shares of our common stock not acquired pursuant to the stock award again will become available for subsequent issuance under the 2015 plan. In addition, the following types of shares of our common stock under the 2015 plan may become available for the grant of new stock awards under the 2015 plan: (1) shares that are forfeited to or repurchased by us prior to becoming fully vested; (2) shares withheld to satisfy income or employment withholding taxes; or (3) shares used to pay the exercise or purchase price of a stock award. Shares issued under the 2015 plan may be previously unissued shares or reacquired shares bought by us on the open market. As of the date hereof, no awards have been granted and no shares of our common stock have been issued under the 2015 plan.

Administration. Our board of directors, or a duly authorized committee thereof, has the authority to administer the 2015 plan. Our board of directors may also delegate to one or more of our officers the authority to (1) designate employees (other than other officers) to be recipients of certain stock awards, and (2) determine the number of shares of common stock to be subject to such stock awards. Subject to the terms of the 2015 plan, our board of directors or the authorized committee, referred to herein as the plan administrator, determines recipients, dates of grant, the numbers and types of stock awards to be granted and the terms and conditions of the stock awards, including the period of their exercisability and vesting schedule applicable to a stock award. Subject to the limitations set forth below, the plan administrator will also determine the exercise price, strike price or purchase price of awards granted and the types of consideration to be paid for the award.

The plan administrator has the authority to modify outstanding awards under our 2015 plan. Subject to the terms of our 2015 plan, the plan administrator has the authority to reduce the exercise, purchase or strike price of any outstanding stock award, cancel any outstanding stock award in exchange for new stock awards, cash or other consideration, or take any other action that is treated as a repricing under generally accepted accounting principles, with the consent of any adversely affected participant.

Stock Options. ISOs and NSOs are granted pursuant to stock option agreements adopted by the plan administrator. The plan administrator determines the exercise price for a stock option, within the terms and conditions of the 2015 plan, provided that the exercise price of a stock option generally cannot be less than 100% of the fair market value of our common stock on the date of grant. Options granted under the 2015 plan vest at the rate specified by the plan administrator.

The plan administrator determines the term of stock options granted under the 2015 plan, up to a maximum of seven years. Unless the terms of an optionholder’s stock option agreement provide otherwise, if an optionholder’s service relationship with us, or any of our affiliates, ceases for any reason other than disability, death or cause, the optionholder may generally exercise any vested options for a period of three months following the cessation of service. The option term may be extended in the event that exercise of the option following such a termination of service is prohibited by applicable securities laws or our insider trading policy. If an optionholder’s service relationship with us or any of our affiliates ceases due to disability or death, or an optionholder dies within a certain period following cessation of service, the optionholder or a beneficiary may generally exercise any vested options for a period of 12 months in the event of disability and 18 months in the event of death. In the event of a termination for cause, options generally terminate immediately upon the termination of the individual for cause. In no event may an option be exercised beyond the expiration of its term.

Acceptable consideration for the purchase of common stock issued upon the exercise of a stock option will be determined by the plan administrator and may include (1) cash, check, bank draft or money order, (2) a

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broker-assisted cashless exercise, (3) the tender of shares of our common stock previously owned by the optionholder, (4) a net exercise of the option if it is an NSO, and (5) other legal consideration approved by the plan administrator.

Unless the plan administrator provides otherwise, options generally are not transferable except by will, the laws of descent and distribution, or pursuant to a domestic relations order. An optionholder may designate a beneficiary, however, who may exercise the option following the optionholder’s death.

Tax Limitations on Incentive Stock Options. The aggregate fair market value, determined at the time of grant, of our common stock with respect to ISOs that are exercisable for the first time by an optionholder during any calendar year under all of our stock plans may not exceed $100,000. Options or portions thereof that exceed such limit will generally be treated as NSOs. No ISO may be granted to any person who, at the time of the grant, owns or is deemed to own stock possessing more than 10% of our total combined voting power or that of any of our affiliates unless (1) the option exercise price is at least 110% of the fair market value of the stock subject to the option on the date of grant, and (2) the term of the ISO does not exceed five years from the date of grant.

Restricted Stock Awards. Restricted stock awards are granted pursuant to restricted stock award agreements adopted by the plan administrator. Restricted stock awards may be granted in consideration for (1) cash, check, bank draft or money order, (2) services rendered to us or our affiliates, or (3) any other form of legal consideration. Common stock acquired under a restricted stock award may, but need not, be subject to a share repurchase option in our favor in accordance with a vesting schedule to be determined by the plan administrator. A restricted stock award may be transferred only upon such terms and conditions as set by the plan administrator. Except as otherwise provided in the applicable award agreement, restricted stock awards that have not vested may be forfeited or repurchased by us upon the participant’s cessation of continuous service for any reason.

Restricted Stock Unit Awards. Restricted stock unit awards are granted pursuant to restricted stock unit award agreements adopted by the plan administrator. Restricted stock unit awards may be granted in consideration for any form of legal consideration. A restricted stock unit award may be settled by cash, delivery of stock, a combination of cash and stock as deemed appropriate by the plan administrator, or in any other form of consideration set forth in the restricted stock unit award agreement. Additionally, dividend equivalents may be credited in respect of shares covered by a restricted stock unit award. Except as otherwise provided in the applicable award agreement, restricted stock units that have not vested will be forfeited upon the participant’s cessation of continuous service for any reason.

Stock Appreciation Rights. Stock appreciation rights are granted pursuant to stock appreciation right agreements adopted by the plan administrator. The plan administrator determines the strike price for a stock appreciation right, which generally cannot be less than 100% of the fair market value of our common stock on the date of grant. Upon the exercise of a stock appreciation right, we will pay the participant an amount equal to the product of (1) the excess of the per share fair market value of our common stock on the date of exercise over the strike price, multiplied by (2) the number of shares of common stock with respect to which the stock appreciation right is exercised. Stock appreciation distribution may be paid in stock, cash, a combination of stock and cash as deemed appropriate by the plan administrator, or any other form of consideration set forth in the stock appreciation right agreement. A stock appreciation right granted under the 2015 plan vests at the rate specified in the stock appreciation right agreement as determined by the plan administrator.

The plan administrator determines the term of stock appreciation rights granted under the 2015 plan, up to a seven years. Unless the terms of a participant’s stock appreciation right agreement provides otherwise, if a participant’s service relationship with us or any of our affiliates ceases for any reason other than cause, disability or death, the participant may generally exercise any vested stock appreciation right for a period of three months following the cessation of service. The stock appreciation right term may be further extended in the event that exercise of the stock appreciation right following such a termination of service is prohibited by applicable securities laws. If a participant’s service relationship with us, or any of our affiliates, ceases due to disability or

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death, or a participant dies within a certain period following cessation of service, the participant or a beneficiary may generally exercise any vested stock appreciation right for a period of 12 months in the event of disability and 18 months in the event of death. In the event of a termination for cause, stock appreciation rights generally terminate immediately upon the occurrence of the event giving rise to the termination of the individual for cause. In no event may a stock appreciation right be exercised beyond the expiration of its term.

Performance Awards. The 2015 plan permits the grant of performance-based stock and cash awards that may qualify as performance-based compensation that is not subject to the $1,000,000 limitation on the income tax deductibility of compensation paid to a covered executive officer imposed by Section 162(m) of the Code. To help assure that the compensation attributable to performance-based awards will so qualify, our compensation committee can structure such awards so that stock or cash will be issued or paid pursuant to such award only after the achievement of certain pre-established performance goals during a designated performance period.

The performance goals that may be selected include one or more of the following: (1) earnings (including earnings per share and net earnings); (2) earnings before interest, taxes and depreciation; (3) earnings before interest, taxes, depreciation and amortization; (4) earnings before interest, taxes, depreciation, amortization and legal settlements; (5) earnings before interest, taxes, depreciation, amortization, legal settlements and other income (expense); (6) earnings before interest, taxes, depreciation, amortization, legal settlements, other income (expense) and stock-based compensation; (7) earnings before interest, taxes, depreciation, amortization, legal settlements, other income (expense), stock-based compensation and changes in deferred revenue; (8) total stockholder return; (9) return on equity or average stockholder’s equity; (10) return on assets, investment, or capital employed; (11) stock price; (12) margin (including gross margins); (13) income (before or after taxes); (14) operating income; (15) operating income after taxes; (16) pre-tax profit; (17) operating cash flow; (18) sales or revenue targets; (19) increases in revenues or product revenues; (20) annual or monthly recurring revenue; (21) improvement in or attainment of working capital levels; (22) economic value added (or an equivalent metric); (23) market share; (24) cash flow or operating cash flow; (25) cash flow per share; (26) share price performance; (27) debt reduction; (28) budget management, expenses or cost reduction goals; (29) stockholders’ equity; (30) capital expenditures; (31) debt levels; (32) operating profit or net operating profit; (33) workforce diversity; (34) growth of net income or operating income; (35) billings; (36) bookings or deployments; (37) employee retention; (38) partner satisfaction; (39) progress of partnered programs; (40) strategic partnerships or transactions (including in-licensing and out-licensing of intellectual property; and (41) to the extent that an award is not intended to comply with Section 162(m) of the Code, other measures of performance selected by our board of directors.

The performance goals may be based on a company-wide basis, with respect to one or more business units, divisions, affiliates, or business segments, and in either absolute terms or relative to the performance of one or more comparable companies or the performance of one or more relevant indices. Unless specified otherwise (i) in the award agreement at the time the award is granted or (ii) in such other document setting forth the performance goals at the time the goals are established, we will appropriately make adjustments in the method of calculating the attainment of performance goals as follows: (1) to exclude restructuring and/or other nonrecurring charges; (2) to exclude exchange rate effects; (3) to exclude the effects of changes to generally accepted accounting principles; (4) to exclude the effects of any statutory adjustments to corporate tax rates; (5) to exclude the effects of any “extraordinary items” as determined under generally accepted accounting principles; (6) to exclude the dilutive effects of acquisitions or joint ventures; (7) to assume that any business divested by us achieved performance objectives at targeted levels during the balance of a performance period following such divestiture; (8) to exclude the effect of any change in the outstanding shares of our common stock by reason of any stock dividend or split, stock repurchase, reorganization, recapitalization, merger, consolidation, spin-off, combination or exchange of shares or other similar corporate change, or any distributions to common stockholders other than regular cash dividends; (9) to exclude the effects of stock-based compensation and the award of bonuses under our bonus plans; (10) to exclude costs incurred in connection with potential acquisitions or divestitures that are required to be expensed under generally accepted accounting principles; (11) to exclude the goodwill and intangible asset impairment charges that are required to be recorded under generally accepted

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accounting principles; or (12) to exclude the effect of any other unusual, non-recurring gain or loss or other extraordinary item. In addition, we retain the discretion to reduce or eliminate the compensation or economic benefit due upon attainment of the performance goals and to define the manner of calculating the performance criteria we select to use for such performance period. The performance goals may differ from participant to participant and from award to award.

Other Stock Awards. The plan administrator may grant other awards based in whole or in part by reference to our common stock. The plan administrator will set the number of shares under the stock award and all other terms and conditions of such awards.

Changes to Capital Structure. In the event that there is a specified type of change in our capital structure, such as a stock split or recapitalization, appropriate adjustments will be made to (1) the class and maximum number of shares reserved for issuance under the 2015 plan, (2) the class and maximum number of shares by which the share reserve may increase automatically each year, (3) the class and maximum number of shares that may be issued upon the exercise of ISOs, (4) the class and maximum number of shares subject to stock awards that can be granted in a calendar year (as established under the 2015 plan pursuant to Section 162(m) of the Code) and (5) the class and number of shares and exercise price, strike price, or purchase price, if applicable, of all outstanding stock awards.

Corporate Transactions. In the event of certain specified significant corporate transactions, any surviving or acquiring company or parent company may assume or continue any or all stock awards or may substitute similar stock awards for them. The terms of any assumption, continuation or substitution will be set by our board of directors. In the event the surviving or acquiring company (or its parent company) does not assume, continue, or substitute a stock award and a participant’s service with us has not terminated prior to the effective time of the corporate transaction, the vesting of such participant’s stock awards will be accelerated in full to a date prior to the effective time of such corporate transaction. If a participant’s service with us has terminated prior to the effective time of the corporate transaction, the vesting of such participant’s stock awards will not be accelerated and such stock awards will terminate if not exercised prior to the effective time of the corporate transaction, unless otherwise provided in a written agreement between us and the participant. Notwithstanding the foregoing, in the event a participant’s stock awards will terminate if not exercised prior to the effective time of a corporate transaction, our board of directors may provide, in its sole discretion, that such participant may not exercise his or her stock awards but will receive a payment, in such form as may be determined by our board of directors, equal to the excess, if any, of (1) the value of the property the participant would have received upon the exercise of his or her stock award, over (2) any exercise price payable by such participant in connection with such exercise.

Our plan administrator is not obligated to treat all stock awards or portions of stock awards, even those that are of the same type, in the same manner.

Under the 2015 plan, a corporate transaction is generally the consummation of (1) a sale or other disposition of all or substantially all of our consolidated assets, (2) a sale or other disposition of at least 90% of our outstanding securities, (3) a merger, consolidation or similar transaction following which we are not the surviving corporation, or (4) a merger, consolidation or similar transaction following which we are the surviving corporation but the shares of our common stock outstanding immediately prior to such transaction are converted or exchanged into other property by virtue of the transaction.

Change in Control. The plan administrator may provide, in an individual award agreement or in any other written agreement between a participant and us that the stock award will be subject to additional acceleration of vesting and exercisability in the event of a change in control. Under the 2015 plan, a change in control is generally (1) the acquisition by a person or entity of more than 50% of our combined voting power other than by merger, consolidation or similar transaction subject to certain exceptions; (2) a consummated merger, consolidation or similar transaction immediately after which our stockholders cease to own more than 50% of the combined voting

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power of the surviving entity; (3) a consummated sale, lease or exclusive license or other disposition of all or substantially all of our consolidated assets; or (4) individuals who constitute our incumbent board of directors ceasing to constitute at least a majority of our board of directors.

Amendment and Termination. Our board of directors has the authority to amend, suspend, or terminate our 2015 plan, provided that such action does not materially impair the existing rights of any participant without such participant’s written consent. No ISOs may be granted after the tenth anniversary of the date our board of directors adopted our 2015 plan.

2010 Equity Incentive Plan

Our board of directors adopted our 2010 plan in April 2010, and our stockholders approved our 2010 plan in June 2010. Our 2010 plan was amended most recently in June 2014. Our 2010 plan provides for the grant of incentive stock options, or ISOs, within the meaning of Section 422 of the Code, to our employees, and for the grant of nonstatutory stock options, or NSOs, restricted stock awards, restricted stock unit awards and stock appreciation rights to our employees, directors and consultants.

Our 2015 plan will become effective upon the execution of the underwriting agreement related to this offering. As a result, we do not expect to grant any additional awards under the 2010 plan following that date, although any awards granted under the 2010 plan will remain subject to the terms of our 2010 plan and applicable award agreements, until such outstanding awards that are stock options are exercised, or until they terminate or expire by their terms, and until any restricted stock awards become vested, terminate or are forfeited.

Authorized Shares

The maximum number of shares of our common stock that may be issued under our 2010 plan is 4,193,563 shares. The maximum number of shares that may be issued upon the exercise of ISOs under our 2010 plan is two times the share reserve of the 2010 plan. Shares subject to stock awards granted under our 2010 plan that expire or terminate without being exercised in full or are settled in cash do not reduce the number of shares available for issuance under our 2010 plan. Additionally, shares issued pursuant to stock awards under our 2010 plan that we repurchase or that are forfeited, as well as shares used to pay the exercise price of a stock award or to satisfy the tax withholding obligations related to a stock award, become available for future grant under our 2010 plan, although such shares may not be subsequently issued pursuant to the exercise of an ISO.

Plan Administration

Our board of directors or a duly authorized committee of our board of directors administers our 2010 plan and the stock awards granted under it. Under our 2010 plan, the board of directors has the authority to determine and amend the terms of awards, including recipients, the exercise, purchase or strike price of stock awards, if any, the number of shares subject to each stock award, the vesting schedule applicable to the awards, together with any vesting acceleration, and the form of consideration, if any, payable upon exercise or settlement of the award and the terms of the award agreements for use under our 2010 plan. The board may amend the 2010 plan in these and other respects with the consent of any adversely affected participant, although certain material amendments to the 2010 plan require stockholder approval.

Under the 2010 plan, the board of directors also has the authority to modify outstanding awards, reprice any outstanding option, cancel any outstanding stock award in exchange for new stock awards, cash or other consideration, or take any other action that is treated as a repricing under GAAP, although if any such action adversely affects a participant, the written consent of that participant is required.

Corporate Transactions

Our 2010 plan provides that in the event of certain specified significant corporate transactions, as defined under our 2015 plan, each outstanding award will be treated as the administrator determines. The administrator

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may (1) arrange for the assumption, continuation or substitution of a stock award by a successor corporation; (2) arrange for the assignment of any reacquisition or repurchase rights held by us to a successor corporation; (3) accelerate the vesting, in whole or in part, of the stock award and provide for its termination prior to the transaction; (4) arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held by us; (5) cancel or arrange for the cancellation of the stock award prior to the transaction in exchange for a cash payment, if any, determined by the board; or (6) make a payment, in the form determined by the board, equal to the excess, if any, of the value of the property the participant would have received upon exercise of the awards prior to the transaction over any exercise price payable by the participant in connection with the exercise. The plan administrator is not obligated to treat all stock awards or portions of stock awards, even those that are of the same type, in the same manner.

Under the 2010 plan, a corporate transaction is generally the consummation of (1) a sale or other disposition of all or substantially all of our assets, (2) a sale or other disposition of at least 90% of our outstanding securities, (3) a merger, consolidation or similar transaction following which we are not the surviving corporation or (4) a merger, consolidation or similar transaction following which we are the surviving corporation but the shares of our common stock outstanding immediately prior to such transaction are converted or exchanged into other property by virtue of the transaction.

In the event of a change in control, awards granted under the 2010 plan will not receive automatic acceleration of vesting and exercisability, although this treatment may be provided for in an award agreement. Under the 2010 plan, a change in control is defined to include (a) the acquisition by any person of more than 50% of the combined voting power of our then outstanding stock; (b) a merger, consolidation or similar transaction in which the stockholders of the company immediately prior to the transaction do not own, directly or indirectly, more than 50% of the combined voting power of the surviving entity (or the parent of the surviving entity); (c) a sale, lease, exclusive license or other disposition of all or substantially all of the assets to an entity that did not previously hold more than 50% of the voting power of our stock; and (d) incumbent board members no longer constitute a majority of the members of the board (where incumbent members include those members of the board in April 2010 plus any members appointed, elected, or nominated for election by a majority of the incumbent board members).

Transferability

Under our 2010 plan, the board of directors may provide for limitations on the transferability of awards, in its sole discretion. Option awards are generally not transferable other than by will or the laws of descent and distribution, except as otherwise provided under our 2010 plan.

Plan Amendment or Termination

Our board of directors has the authority to amend, suspend, or terminate our 2010 plan, although certain material amendments require the approval of our stockholders, and amendments that would impair the rights of any participant require the consent of that participant.

2015 Employee Stock Purchase Plan

Our board of directors adopted our 2015 Employee Stock Purchase Plan (2015 ESPP) in February 2015 and our stockholders approved the 2015 ESPP in March 2015. The 2015 ESPP will become effective immediately upon the execution and delivery of the underwriting agreement related to this offering. The purpose of the 2015 ESPP is to retain the services of new employees and secure the services of new and existing employees while providing incentives for such individuals to exert maximum efforts toward our success and that of our affiliates.

Share Reserve. Following this offering, the 2015 ESPP authorizes the issuance of 530,000 shares of our common stock pursuant to purchase rights granted to our employees or to employees of any of our designated

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affiliates. The number of shares of our common stock reserved for issuance will automatically increase on January 1 of each year, from January 1, 2016 through January 1, 2025 by the least of (1) 2% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, (2) 600,000 shares, or (3) a number determined by our board of directors that is less than (1) and (2). The 2015 ESPP is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the Code, however, the 2015 ESPP authorized the grant of purchase rights that do not meet the requirements of Section 423 of the Code. As of the date hereof, no shares of our common stock have been purchased under the 2015 ESPP.

Administration. Our board of directors has delegated its authority to administer the 2015 ESPP to our compensation committee. The 2015 ESPP is implemented through a series of offerings of purchase rights to eligible employees. Under the 2015 ESPP, we may specify offerings with durations of not more than 27 months, and may specify shorter purchase periods within each offering. Each offering will have one or more purchase dates on which shares of our common stock will be purchased for employees participating in the offering. An offering may be terminated under certain circumstances.

Payroll Deductions. Generally, all regular employees, including executive officers, employed by us or by any of our designated affiliates, may participate in the 2015 ESPP and may contribute, normally through payroll deductions, up to 15% of their earnings for the purchase of our common stock under the 2015 ESPP. Unless otherwise determined by our board of directors, common stock will be purchased for accounts of employees participating in the 2015 ESPP at a price per share equal to the lower of (1) 85% of the fair market value of a share of our common stock on the first date of an offering or (2) 85% of the fair market value of a share of our common stock on the date of purchase.

Limitations. Employees may have to satisfy one or more of the following service requirements before participating in the 2015 ESPP, as determined by our board of directors: (1) customarily employed for more than 20 hours per week, (2) customarily employed for more than five months per calendar year, or (3) continuous employment with us or one of our affiliates for a period of time (not to exceed two years). No employee may purchase shares under the 2015 ESPP at a rate in excess of $25,000 worth of our common stock based on the fair market value per share of our common stock at the beginning of an offering for each year such a purchase right is outstanding. Finally, no employee will be eligible for the grant of any purchase rights under the 2015 ESPP if immediately after such rights are granted, such employee has voting power over 5% or more of our outstanding capital stock measured by vote or value pursuant to Section 424(d) of the Code.

Changes to Capital Structure. In the event that there occurs a change in our capital structure through such actions as a stock split, merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property other than cash, large nonrecurring cash dividend, liquidating dividend, combination of shares, exchange of shares or change in corporate structure or similar transaction, the board of directors will make appropriate adjustments to (1) the number of shares reserved under the 2015 ESPP, (2) the maximum number of shares by which the share reserve may increase automatically each year, (3) the number of shares and purchase price of all outstanding purchase rights and (4) the number of shares that are the subject of purchase limits under each ongoing offering.

Corporate Transactions. In the event of certain significant corporate transactions, including the consummation of: (1) a sale of all or substantially all our assets, (2) the sale or disposition of at least 90% of our outstanding securities, (3) a merger or consolidation where we do not survive the transaction, and (4) a merger or consolidation where we do survive the transaction but the shares of our common stock outstanding immediately prior to such transaction are converted or exchanged into other property by virtue of the transaction, any then-outstanding rights to purchase our stock under the 2015 ESPP may be assumed, continued or substituted for by any surviving or acquiring entity (or its parent company). If the surviving or acquiring entity (or its parent company) elects not to assume, continue or substitute for such purchase rights, then the participants’ accumulated payroll contributions will be used to purchase shares of our common stock within ten business days prior to such corporate transaction under the outstanding purchase rights, and such purchase rights will terminate immediately.

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Plan Amendments, Termination. Our board of directors has the authority to amend or terminate the 2015 ESPP, provided that except in certain circumstances any such amendment or termination may not materially impair any outstanding purchase rights without the holder’s consent. We will obtain stockholder approval of any amendment to the 2015 ESPP as required by applicable law or listing requirements.

Non-Employee Director Compensation

Our board of directors adopted a new non-employee director compensation policy in February 2015 that will become effective upon the execution and delivery of the underwriting agreement related to this offering and will be applicable to all of our non-employee directors. This compensation policy provides that each such non-employee director will receive the following compensation for service on our board of directors, provided, however, that in lieu of any cash payment in 2015, non-employee directors instead received stock options:

• an annual cash retainer of $38,000;

• an additional annual cash retainer of $9,000, $6,000 and $4,000 for service as a member of the audit committee, compensation committee and the nominating and corporate governance committee, respectively;

• an additional annual cash retainer of $11,000, $7,000 and $4,000 for service as chairman of the audit committee, compensation committee and the nominating and corporate governance committee, respectively;

• an initial option grant to purchase 7,000 shares of our common stock and a restricted stock unit grant covering 3,200 shares of common stock on the date of each such non-employee director’s appointment to our board of directors or upon the execution and delivery of the underwriting agreement related to this offering for directors of the company at such time;

• an annual option grant to purchase 3,500 shares of our common stock and a restricted stock unit grant covering 1,600 shares of common stock on the date of each of our annual stockholder meetings.

The following table sets forth information regarding compensation earned by or paid to our non-employee directors during 2014:

Name	Fees Earned or Paid in Cash		Option Awards (1)		Total
Wayne Cantwell		—		—		—
Edward H. Frank, Ph.D.(2)		—	$	65,895	$	65,895
Ronald S. Jankov(3)		—	$	101,437	$	101,437
Michael R. Kourey(4)		—		—		—
Tara Long		—		—		—

(1) The amounts reported do not reflect the amounts actually received by our non-employee directors. Instead, these amounts reflect the aggregate grant date fair value of each stock option granted to our non-employee directors during the fiscal year ended December 31, 2014, as computed in accordance with FASB ASC Topic 718. Assumptions used in the calculation of these amounts are included in Note 6 to our audited financial statements included in this prospectus. As required by SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. Our non-employee directors who have received options will only realize compensation with regard to these options to the extent the trading price of our common stock is greater than the exercise price of such options.

(2) On June 3, 2014, Dr. Frank was granted an option to purchase 91,930 shares of our common stock at an exercise price of $1.50 per share, vesting monthly over a 48 month period commencing on October 24, 2013, subject to acceleration of vesting in the event of a change in control. Dr. Frank early exercised all the shares issuable under his option on October 2, 2014. As of December 31, 2014, Dr. Frank did not hold any options to purchase shares of our common stock.

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(3) Mr. Jankov joined our board of directors in August 2014. On August 5, 2014, Mr. Jankov was granted an option to purchase 96,524 shares of our common stock at an exercise price of approximately $2.20 per share, vesting monthly over a 48 month period commencing on June 11, 2014, subject to acceleration of vesting in the event of a change in control. Mr. Jankov early exercised all the shares issuable under his option on October 20, 2014. As of December 31, 2014, Mr. Jankov did not hold any options to purchase shares of our common stock.

(4) Mr. Kourey resigned from our board of directors in July 2015. As of December 31, 2014, Mr. Kourey held an option to purchase 91,930 shares of our common stock, with an exercise price of $0.75 per share, vesting monthly over a 24 month period commencing on January 3, 2013. The option is now fully vested and is exercisable for a period of two years following Mr. Kourey’s date of resignation. No other non-employee directors held options as of December 31, 2014.

Director Agreements

Offer Letter with Edward H. Frank, Ph.D.

In October 2013, we entered into an offer letter with Dr. Frank pursuant to which he commenced serving on our board of directors. Pursuant to the offer letter, we granted Dr. Frank an option to purchase 91,930 shares of our common stock at an exercise price of $1.50 per share, vesting monthly over a 48 month period commencing on the date of his appointment to our board of directors. The option is early exercisable pursuant to our standard form of early exercise stock purchase agreement. In the event of a change of control, as defined in the offer letter, the vesting of the options granted pursuant to the offer letter, and the unvested portion of any other options that may be granted to Dr. Frank, will be accelerated in full.

Prior Consulting Agreement with Michael R. Kourey

In January 2013, we entered into a consulting agreement with Mr. Kourey, which, as amended, expired pursuant to its terms in January 2015. Pursuant to the consulting agreement, Mr. Kourey commenced serving on our board of directors, and provided consulting services with respect to our business and operations, and such other services mutually agreed upon between Mr. Kourey and us. The consulting agreement was amended in September 2013, and the term of the consulting agreement was extended for a year. Pursuant to the consulting agreement, we granted Mr. Kourey an option to purchase 91,930 shares of our common stock, vesting monthly over a 24 month period beginning on January 3, 2013. The option is now fully vested. Mr. Kourey resigned from our board of directors in July 2015.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

The following includes a summary of transactions since January 1, 2012 to which we have been a party, in which the amount involved in the transaction exceeded $120,000, and in which any of our directors, executive officers or beneficial owners of more than 5% of our capital stock or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest, other than equity and other compensation, termination, change of control and other arrangements, which are described under “Executive and Director Compensation.”

Convertible Note Financings and Preferred Stock Financings

Series A-2 Convertible Preferred Stock Financing

From December 2012 through July 2013, we issued and sold an aggregate of 4,532,662 shares of our Series A-2 convertible preferred stock, or Series A-2 stock, at a purchase price of approximately $5.20 per share, which included conversion of the principal amount and accrued interest on convertible promissory notes (as described below in “2013 Convertible Note Financing” and “2012 Convertible Note Financing”), for aggregate consideration of approximately $23,534,898. Also in connection with the initial issuance and sale of Series A-2 stock, each of the existing investors below also exchanged shares of existing convertible preferred stock held by them for Series A-1 non-convertible preferred stock (the Series A-1 stock) and common stock, pursuant to the Series A-2 preferred stock purchase agreement. For each $1.00 of Series A-2 stock purchased by an investor, such investor was entitled to exchange, for no additional consideration, shares of Series A Preferred Stock, Series B preferred stock, Series C preferred stock, Series D preferred stock, Series E preferred stock, Series F preferred stock, Series F-1 preferred stock, Series G preferred stock and/or Series H preferred stock (the Exchange Preferred Stock) held by them representing $4.00 of liquidation preference for: (i) four shares of Series A-1 stock, (ii) the number of shares of common stock issuable upon conversion of the Exchanged Preferred Stock at the current conversion rate and (iii) three shares of common stock for each share of Series A-2 stock purchased.

Immediately prior to the completion of this offering, all outstanding shares of Series A-2 stock will convert into shares of our common stock at a ratio of approximately 1-for-1.135 and all outstanding shares of Series A-1 stock will terminate and be cancelled upon completion of this offering.

The participants in this preferred stock financing included the following members of our board of directors and holders of more than 5% of our capital stock or entities affiliated with them. The following table sets forth the aggregate number of shares of Series A-2 stock, Series A-1 stock and common stock issued to these related parties in this preferred stock financing:

Participants	Shares of Series A-2 Stock		Shares of Series A-1 Stock		Shares of Common Stock		Consideration in Cash		Conversion of Principal Amount		Conversion of Accrued Interest
Khosla Ventures I, LP(1)		640,532		137,159		2,384,186	$	1,255,300	$	2,035,528	$	34,977
Entities affiliated with Crescendo Ventures(2)		752,865		80,032		1,389,367		1,650,000		2,231,429		27,656
Evergreen IV, LP		195,836		54,230		942,770		1,016,830		—		—
KPCB Holdings, Inc.		220,513		60,886		1,056,980		—		1,127,015		17,944
Entities affiliated with Advanced Equities, Inc.(3)		90,674		25,107		780,442		470,820		—		—
Seagate Singapore International Headquarters Pte. Ltd(4)		1,925,947		—		—		10,000,000		—		—
Wayne Cantwell(5)		9,629		—		—		50,000		—		—

(1) Michael R. Kourey, a former member of our board of directors, was a partner of Khosla Ventures until March 2015. Mr. Kourey resigned from our board of directors in July 2015.

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(2) Wayne Cantwell, one of our directors, is a general partner of Crescendo Ventures. Consists of the following:

Entities affiliated with Crescendo Ventures	Series A-2		Series A-1		Common
Crescendo IV, LP		510,996		65,155		1,151,455
Crescendo IV Coinvestment Fund, LP		78,460		10,004		159,338
Crescendo IV AG & Co. Beteiligungs KG		27,241		3,473		54,262
Crescendo IV Entrepreneur Fund, LP		7,795		994		17,255
Crescendo IV Entrepreneur Fund A, LP		3,188		406		7,057
Crescendo Ventures 401k Profit Sharing Plan fbo Wayne Cantwell		41,728		—		—
Crescendo Ventures 401k Profit Sharing Plan fbo John Borchers		51,358		—		—
Crescendo Ventures 401k Profit Sharing Plan fbo David Spreng		32,099		—		—

(3) Consists of the following:

Entities affiliated with Advanced Equities, Inc.	Series A-2		Series A-1		Common
Advanced Equities eAsic Investments I, LLC		8,082		2,238		94,352
Advanced Equities eAsic Investments II, LLC		45,970		12,729		361,007
AEI 2007 Venture Access Fund I, LLC		805		223		20,907
AEI 2007 Venture Investments I, LLC		3,530		977		47,831
AEI 2007 Venture Investments II, LLC		20,990		5,812		162,001
AEI 2007 Venture Access Fund II, LLC		4,041		1,119		32,410
AEI eASIC Investments III, LLC		1,015		281		10,110
AEI eASIC Investments IV, LLC		6,241		1,728		51,824

(4) Tara Long, a member of our board of directors, is an officer of Seagate Technology PLC. Additionally, we have entered into a product supply agreement with Seagate Technology LLC. See “Product Supply Agreement – Seagate” below.

(5) Wayne Cantwell is a member of our board of directors.

2013 Convertible Note Financing

On May 30, 2013, we entered into a note purchase agreement pursuant to which we issued and sold convertible promissory notes in an aggregate principal amount of $1,500,000. The promissory notes accrued interest at a rate of six percent per year and were due and payable at the election of the holders on or after June 29, 2013. The interest and principal of the promissory notes were, at the election of the holder, (i) convertible at any time into Series A-2 stock at a conversion price of approximately $5.20 per share or (ii) upon a qualified financing with proceeds of at least $3.0 million, either convertible into equity securities issued in such qualified financing or required to be repaid from the proceeds of such qualified financing. On July 2, 2013, the aggregate principal amount of the promissory notes and accrued interest of $1,508,136.99 were converted into 290,459 shares of Series A-2 preferred at a conversion price of approximately $5.20 per share.

The participants in this financing included the following members of our board of directors and holders of more than 5% of our capital stock or entities affiliated with them. The following table sets forth the aggregate principal amount of promissory notes purchased in this 2013 convertible note financing:

Participants	Loan Amount
Khosla Ventures I, LP(1)	$	750,000
Entities affiliated with Crescendo Ventures(2)	$	750,000

(1) Michael R. Kourey, a former member of our board of directors, was a partner of Khosla Ventures until March 2015. Mr. Kourey resigned from our board of directors in July 2015.

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(2) Consists of $610,575 invested by Crescendo IV, LP, $32,550 invested by Crescendo IV AG & Co. Beteiligungs KG, $9,315 invested by Crescendo IV Entrepreneur Fund, LP, $3,810 purchased by Crescendo IV Entrepreneur Fund A, LP, and $93,750 purchased by Crescendo IV Coinvestment Fund, LLC. Wayne Cantwell, a member of our board of directors, is a general partner of Crescendo Ventures.

2012 Convertible Note Financing

In June 2012, we entered into a note purchase agreement pursuant to which we issued and sold convertible promissory notes in June and October of 2012 in an aggregate principal amount of $4,068,646. The promissory notes accrued interest at a rate of five percent per year and were due and payable upon the demand of the holders on or after 90 days from the date of execution of the note purchase agreement. The interest and principal of the promissory notes were automatically convertible into equity securities issued in connection with a qualified financing with proceeds of at least $7.5 million. On December 13, 2012, and January 28, 2013, respectively, principal amounts of the notes and accrued interest of $4,049,937.94 and $7,722.38 were converted into 779,995 and 1,487 shares of Series A-2 preferred at a conversion price of approximately $5.20 per share.

The participants in this financing included the following members of our board of directors and holders of more than 5% of our capital stock, or entities affiliated with them. The following table sets forth the aggregate principal amounts of convertible promissory notes purchased in this 2012 convertible note financing:

Participants	Loan Amount
Entities affiliated with Crescendo Ventures(1)	$	1,481,429
Khosla Ventures I, LP(2)	$	1,285,528
KPCB Holdings, Inc.	$	1,127,015

(1) Consists of $1,206,031 purchased by Crescendo IV, LP; $185,179 purchased by Crescendo IV Coinvestment Fund, LP; $64,294 purchased by Crescendo IV AG & Co. Beteiligungs KG; $18,399 purchased by Crescendo IV Entrepreneur Fund, LP; and $7,526 purchased by Crescendo IV Entrepreneur Fund A, LP. Wayne Cantwell, a member of our board of directors, is a general partner of Crescendo Ventures.

(2) Michael R. Kourey, a former member of our board of directors, was a partner of Khosla Ventures until March 2015. Mr. Kourey resigned from our board of directors in July 2015.

Product Supply Agreement—Seagate

We have entered into a product supply agreement with Seagate Technology LLC, an affiliate of Seagate Technology PLC (collectively, “Seagate”) pursuant to which Seagate orders products from us from time to time. Ms. Long, one of our directors, is the Vice President of Strategy and Corporate Development at Seagate. All purchase orders entered into with Seagate are pursuant to our product supply agreement. We have no special pricing or other arrangements with Seagate and believe that the terms of all purchase orders and transactions with Seagate were comparable to terms we and Seagate could have obtained in arm’s length dealings with unrelated third parties. Sales to Seagate, including sales to contract manufacturers or ODMs at the direction of Seagate, accounted for $1.6 million, $9.8 million and $21.0 million of revenues during the years ended December 31, 2012, 2013 and 2014, respectively, and $4.1 million and $3.2 million for the three months ended March 31, 2014 and 2015. In connection with our transactions with Seagate, we offset against research and development expenses an amount of $0.5 million, $1.3 million and $1.5 million for the years ended December 31, 2012, 2013 and 2014, respectively, and $0 and $0.2 million for the three months ended March 31, 2014 and 2015, respectively.

In addition, Seagate Singapore International Headquarters Pte. Ltd., an entity affiliated with Seagate, purchased 1,925,947 shares of our Series A-2 stock. See “Convertible Note Financings and Preferred Stock Financings—Series A-2 Convertible Preferred Stock Financing” above.

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Employment and Consulting Agreements

We have entered into employment agreements with our executive officers. See “Executive and Director Compensation—Agreements with our Named Executive Officers.” We have entered into an offer letter agreement with Dr. Frank, a member of our board of directors and previously entered into a consulting agreement with Mr. Kourey, a former member of our board of directors. See “Executive and Director Compensation—Director Agreement.”

Stock Option Grants to Executive Officers and Non-Employee Directors

We have granted stock options to our executive officers and non-employee directors. For a description of options granted to our named executive officers and non-employee directors, see the section titled “Executive and Director Compensation—Outstanding Equity Awards at Fiscal Year-End” and “Executive and Director Compensation” above.

Indemnification Agreements

We have entered, and intend to continue to enter, into separate indemnification agreements with our directors and executive officers, in addition to the indemnification provided for in our amended and restated bylaws. These agreements, among other things, require us to indemnify our directors and executive officers for certain expenses, including attorneys’ fees, judgments, fines and settlement amounts incurred by a director or executive officer in any action or proceeding arising out of their services as one of our directors or executive officers or as a director or executive officer of any other company or enterprise to which the person provides services at our request. For more information regarding these indemnification arrangements, see “Management—Limitation on Liability and Indemnification of Directors and Officers.” We believe that these bylaw provisions and indemnification agreements are necessary to attract and retain qualified persons as directors and officers.

The limitation of liability and indemnification provisions in our amended and restated certificate of incorporation and amended and restated bylaws may discourage stockholders from bringing a lawsuit against directors for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against directors and officers, even though an action, if successful, might benefit us and our stockholders. A stockholder’s investment may decline in value to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.

Policies and Procedures for Transactions with Related Persons

We have adopted a written related-person transactions policy that sets forth our policies and procedures regarding the identification, review, consideration and oversight of “related-person transactions.” For purposes of our policy only, a “related-person transaction” is a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which we and any “related person” are participants involving an amount that exceeds $120,000.

Transactions involving compensation for services provided to us as an employee, consultant or director are not considered related-person transactions under this policy. A related person is any executive officer, director, nominee to become a director or a holder of more than 5% of our common stock, including any of their immediate family members and affiliates, including entities owned or controlled by such persons.

Under the policy, where a transaction has been identified as a related-person transaction, management must present information regarding the proposed related-person transaction to our audit committee (or, where review by our audit committee would be inappropriate, to another independent body of our board of directors) for review. The presentation must include a description of, among other things, all of the parties, the direct and indirect interests of the related persons, the purpose of the transaction, the material facts, the benefits of the transaction to us and whether any alternative transactions are available, an assessment of whether the terms are

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comparable to the terms available from unrelated third parties and management’s recommendation. To identify related-person transactions in advance, we rely on information supplied by our executive officers, directors and certain significant stockholders. In considering related-person transactions, our audit committee or another independent body of our board of directors takes into account the relevant available facts and circumstances including, but not limited to:

• the risks, costs and benefits to us;

• the impact on a director’s independence in the event the related person is a director, immediate family member of a director or an entity with which a director is affiliated;

• the terms of the transaction;

• the availability of other sources for comparable services or products; and

• the terms available to or from, as the case may be, unrelated third parties.

In the event a director has an interest in the proposed transaction, the director must recuse himself or herself from the deliberations and approval.

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PRINCIPAL AND SELLING STOCKHOLDERS

The following table sets forth information regarding beneficial ownership of our capital stock by:

• each person, or group of affiliated persons, known by us to beneficially own more than 5% of our common stock;

• each of our directors;

• each of our named executive officers;

• all of our current executive officers and directors as a group; and

• each of the selling stockholders.

The percentage ownership information under the column entitled “Before offering” is based on 15,068,223 shares of common stock outstanding as of June 30, 2015, assuming conversion of all outstanding shares of our Series A-2 stock into 5,145,683 shares of common stock and the termination and cancellation of 533,301 outstanding shares of our Series A-1 stock upon the completion of this offering. The percentage ownership information under the column entitled “After offering” is based on the sale of shares of common stock in this offering (including by selling stockholders), assuming an initial public offering price of $         per share (the midpoint of the price range set forth on the cover page of this prospectus).

Information with respect to beneficial ownership has been furnished by each director, officer, beneficial owner of more than 5% of our common stock, or selling stockholders. We have determined beneficial ownership in accordance with the rules of the SEC. These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities. In addition, the rules include shares of our common stock issuable pursuant to the exercise of stock options or warrants that are either immediately exercisable or exercisable within 60 days of June 30, 2015. As noted in the applicable footnotes to the table, some of the options are not vested but are exercisable at any time and, if exercised, subject to a lapsing right of repurchase until the options are fully vested. These shares are deemed to be outstanding and beneficially owned by the person holding those options or warrants for the purpose of computing the percentage ownership of that person, but they are not treated as outstanding for the purpose of computing the percentage ownership of any other person. Unless otherwise indicated, the persons or entities identified in this table have sole voting and investment power with respect to all shares shown as beneficially owned by them, subject to applicable community property laws.

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Except as otherwise noted below, the address for each person or entity listed in the table is c/o eASIC Corporation, 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

Name and Address of Beneficial Owner	Shares beneficially owned prior to this offering					Number of shares being offered	Shares beneficially owned after this offering
	Shares		%				Shares	%
Greater than 5% stockholders
Khosla Ventures I, LP(1) 2128 Sand Hill Road Menlo Park, CA 94025		3,111,351		20.6	%				%
Entities affiliated with Crescendo Ventures(2) 600 Hansen Way Palo Alto, CA 94304		2,244,055		14.9	%				%
Seagate Singapore International Headquarters Pte. Ltd.(3) c/o Seagate Technology LLC 10200 S. De Anza Boulevard Cupertino, CA 95014		2,186,437		14.5	%				%
KPCB Holdings, Inc.(4) c/o Kleiner Perkins Caufield & Byers 2750 Sand Hill Road Menlo Park, CA 94025		1,307,318		8.7	%				%
Evergreen IV, L.P.(5) 25 Habarzel Street Tel-Aviv 69710 Israel		1,165,093		7.7	%				%
Entities Affiliated with Advanced Equities(6) 311 S. Wacker Drive, Suite 1650 Chicago, IL 60606		883,375		5.9	%				%
Directors and Named Executive Officers
Ronnie Vasishta(7)		704,001		4.5	%				%
Ranko Scepanovic, Ph.D.(8)		386,103		2.5	%				%
Richard J. Deranleau(9)		193,048		1.3	%				%
Wayne Cantwell(2)(10)		2,261,986		15.0	%				%
Dr. Edward H. Frank(11)		95,430			*				*
Ronald S. Jankov(12)		100,024			*				*
Michael R. Kourey(13)		91,930			*				*
Tara Long(14)		7,000			*				*
All current executive officers and directors as a group (10 persons)(15)		4,012,706		24.1	%				%
Selling Stockholders

* Represents beneficial ownership of less than one percent

(1) Vinod Khosla (Khosla) is the manager of VK Services, LLC (VK Services), the manager of Khosla Ventures Associates I, LLC (KVA I). KVA I is the general partner of Khosla Ventures I, L.P. (KV I). Each of Khosla, VK Services and KVA I may be deemed to have voting and dispositive power over the shares held by KV I and each of Khosla, VK Services and KVA I may be deemed to have indirect beneficial ownership of the shares held by KV I.

(2) Consists of (a) 1,731,564 shares held by Crescendo IV, LP (CIV), (b) 248,409 shares held by Crescendo IV Coinvestment Fund, LLC (Coinvestment), (c) 85,187 shares held by Crescendo IV AG & Co. Beteiligungs KG (Beteiligungs), (d) 26,104 shares held by Crescendo IV Entrepreneur Fund, LP (CIV Entrepreneur), (e) 10,676 shares held by Crescendo IV Entrepreneur Fund A, LP (CIV Entrepreneur A and, together with CIV, Coinvestment, Beteiligungs, CIV Entrepreneur, the Crescendo Entities), (f) 36,440 shares held by

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Crescendo Ventures 401k Profit Sharing Plan fbo David Spreng, (g) 58,304 shares held by Crescendo Ventures 401k Profit Sharing Plan fbo John Borchers, and (h) 47,371 shares held by Crescendo Ventures 401k Profit Sharing Plan fbo Wayne Cantwell. Crescendo Ventures IV, LLP (CVIV) is the general partner of CIV, CIV Entrepreneur, CIV Entrepreneur A and Coinvestment and may be deemed to have sole voting and dispositive power over the shares held by CIV, CIV Entrepreneur, CIV Entrepreneur A and Coinvestment. Crescendo German Investments IV, LLC is the managing partner of Beteiligungs and may be deemed to have sole voting and dispositive power over the shares held by Beteiligungs. Wayne Cantwell, one of our directors, John Borchers and David Spreng are the general partners of CVIV and may be deemed to share voting and dispositive power over the shares held by the Crescendo Entities.

(3) The directors of Seagate Singapore International Headquarters Pte. Ltd. (Seagate), Lai Chun Cheong and Patrick J. O’Malley, III may be deemed to have voting and dispositive power over the shares held by Seagate.

(4) Consists of (a) 1,150,701 shares held by Kleiner Perkins Caufield & Byers XI-A, L.P., or KPCB XI-A, (b) 22,486 shares held by Kleiner Perkins Caufield & Byers XI-B, L.P., or KPCB XI-B, and (c) 134,131 shares held by individuals and entities associated with Kleiner Perkins Caufield & Byers. All shares are held for convenience in the name of “KPCB Holdings, Inc. as nominee,” for the accounts of such individuals and entities who each exercise their own voting and dispositive power over such shares. The general partner of KPCB XI-A and KPCB XI-B is KPCB XI Associates, LLC. Brook H. Byers, L. John Doerr, Raymond J. Lane and Theodore E. Schlein, the managers of KPCB XI Associates, exercise shared voting and dispositive power over the shares directly held by KPCB XI-A and KPCB XI-B.

(5) Erez Shachar, Boaz Dinte, Motti Hoss, Ofer Ne’eman, Ronit Bendori, Amichai Hammer and Adi Gan are members of the investment committee of Evergreen IV, LP., and may be deemed to share voting and dispositive power of the shares held by Evergreen IV, LP.

(6) Consists of (a) 108,387 shares held by Advanced Equities eAsic Investments I, LLC, (b) 408,333 shares held Advanced Equities eAsic Investments II, LLC, (c) 21,077 shares held by AEI 2007 Venture Access Fund I, LLC, (d) 51,838 shares held by AEI 2007 Venture Investments I, LLC, (e) 185,829 shares held by AEI 2007 Venture Investments II, LLC, (f) 36,997 shares held by AEI 2007 Venture Access Fund II, LLC, (g) 11,262 shares held by AEI eASIC Investments III, LLC, (h) 58,909 shares held by AEI eASIC Investments IV, LLC, and (i) 743 shares held by AEI 2007 Venture Access Fund I-2, LLC. On September 16, 2014, Spruce Direct Investment Fund I, L.P. (SDI), an affiliate of Spruce Investment Advisors LLC, acquired assets and interests from Benman Holdings, LLC (BM Holdings), an affiliate of Southport Lane Financial, Inc. SDI is currently the managing member or general partner of the funds that BM Holdings acquired from Advanced Equities. Scott Ogur, the managing member of Spruce Management LLC, the general partner of SDI has sole voting and dispositive power with respect to these shares.

(7) Represents shares held by the Vasishta Family Trust 2007 for which Mr. Vasishta is a trustee and 696,002 shares of common stock issuable pursuant to stock options exercisable within 60 days of June 30, 2015, of which 7,721 shares are unvested, but are early exercisable within 60 days of June 30, 2015.

(8) Reflects 386,103 shares of common stock issuable pursuant to stock options exercisable within 60 days of June 30, 2015, of which 5,702 shares are unvested, but are early exercisable within 60 days of June 30, 2015.

(9) Represents shares of common stock issuable pursuant to stock options exercisable within 60 days of June 30, 2015, of which 140,764 shares are unvested, but are early exercisable within 60 days of June 30, 2015.

(10) Includes 47,371 shares held by the Crescendo Ventures 401k Profit Sharing Plan fbo Wayne Cantwell and 7,000 shares of common stock issuable pursuant to stock options exercisable within 60 days of June 30, 2015, all of which are unvested but are early exercisable within 60 days of June 30, 2015. Mr. Cantwell is a general partner of CVIV and may be deemed to share voting and dispositive power over the shares held by the Crescendo Entities. Mr. Cantwell disclaims beneficial ownership of the shares held by the Crescendo Entities except to the extent of his pecuniary interest therein.

(11) Includes 49,796 shares subject to repurchase by the Company within 60 days of June 30, 2015 and 3,500 shares of common stock issuable pursuant to stock options exercisable within 60 days of June 30, 2015, all of which are unvested but are early exercisable within 60 days of June 30, 2015.

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(12) Includes 68,372 shares subject to repurchase by the Company within 60 days of June 30, 2015 and 3,500 shares of common stock issuable pursuant to stock options exercisable within 60 days of June 30, 2015, all of which are unvested but are early exercisable within 60 days of June 30, 2015.

(13) Includes 91,930 shares of common stock issuable pursuant to stock options exercisable within 60 days of June 30, 2015. Mr. Kourey resigned from our board of directors in July 2015.

(14) Represents 7,000 shares of common stock issuable pursuant to stock options exercisable within 60 days of June 30, 2015, all of which are unvested but are early exercisable within 60 days of June 30, 2015.

(15) Includes (a) 1,559,934 shares of common stock issuable pursuant to stock options exercisable within 60 days of June 30, 2015, of which 252,937 shares are unvested and (c) 118,168 shares subject to repurchase by us as of 60 days of June 30, 2015.

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DESCRIPTION OF CAPITAL STOCK

The following is a summary of the rights of our common and preferred stock and some of the provisions of our amended and restated certificate of incorporation and amended and restated bylaws, which will become effective immediately prior to the completion of this offering, and of the Delaware General Corporation Law. This summary is not complete. For more detailed information, please see our amended and restated certificate of incorporation and amended and restated bylaws, which are filed as exhibits to the registration statement of which this prospectus is a part, as well as the relevant provisions of the Delaware General Corporation Law.

General

Immediately prior to the completion of this offering and upon the filing of our amended and restated certificate of incorporation, our authorized capital stock will consist of 100,000,000 shares of common stock, par value $0.001 per share and 10,000,000 shares of preferred stock, par value $0.001 per share. All of our authorized preferred stock upon the completion of this offering will be undesignated.

Common Stock

Outstanding Shares

On June 30, 2015, there were 15,068,223 shares of common stock outstanding, held of record by 210 stockholders. Based on such number of shares of common stock outstanding as of June 30, 2015, and (i) assuming the conversion of all outstanding shares of our Series A-2 stock into 5,145,683 shares of common stock immediately prior to the completion of this offering and (ii) the termination and cancellation of 533,301 outstanding shares of our Series A-1 stock upon the completion of this offering.

As of June 30, 2015, there were 3,404,994 shares of common stock subject to outstanding options under our equity incentive plans.

Voting

Our common stock is entitled to one vote for each share held of record on all matters submitted to a vote of the stockholders, including the election of directors, and does not have cumulative voting rights. Accordingly, the holders of a majority of the shares of our common stock entitled to vote in any election of directors can elect all of the directors standing for election.

Dividends

Subject to preferences that may be applicable to any then outstanding preferred stock, the holders of common stock are entitled to receive dividends, if any, as may be declared from time to time by our board of directors out of legally available funds.

Liquidation

In the event of our liquidation, dissolution or winding up, holders of our common stock will be entitled to share ratably in the net assets legally available for distribution to stockholders after the payment of all of our debts and other liabilities, subject to the satisfaction of any liquidation preference granted to the holders of any outstanding shares of preferred stock.

Rights and Preferences

Holders of our common stock have no preemptive, conversion or subscription rights, and there are no redemption or sinking fund provisions applicable to our common stock. The rights, preferences and privileges of the holders of our common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of our preferred stock that we may designate and issue in the future.

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Fully Paid and Nonassessable

All of our outstanding shares of common stock are, and the shares of common stock to be issued in this offering will be, fully paid and nonassessable.

Preferred Stock

As of June 30, 2015, we had outstanding an aggregate of 4,532,662 shares of convertible preferred stock and 533,301 shares of non-convertible preferred stock held of record by 68 stockholders

Immediately prior to the completion of this offering, all outstanding shares of Series A-2 stock at June 30, 2015, will convert into 5,145,683 shares of our common stock and upon the completion of this offering, 533,301 outstanding shares of Series A-1 non-convertible preferred stock will terminate and be cancelled.

Immediately prior to completion of this offering, our certificate of incorporation will be amended and restated to delete all references to such shares of convertible preferred stock. Under the amended and restated certificate of incorporation, our board of directors will have the authority, without further action by the stockholders, to issue up to 10,000,000 shares of preferred stock in one or more series, to establish from time to time the number of shares to be included in each such series, to fix the rights, preferences and privileges of the shares of each wholly unissued series and any qualifications, limitations or restrictions thereon and to increase or decrease the number of shares of any such series, but not below the number of shares of such series then outstanding.

Our board of directors may authorize the issuance of preferred stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders of the common stock. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deferring or preventing a change in our control that may otherwise benefit holders of our common stock and may adversely affect the market price of the common stock and the voting and other rights of the holders of common stock. We have no current plans to issue any shares of preferred stock.

Stock Options

As of June 30, 2015, 3,404,994 shares of common stock were issuable upon the exercise of outstanding stock options, at a weighted-average exercise price of $1.59 per share.

Warrants

As of June 30, 2015, 43,328 shares of common stock were issuable upon exercise of outstanding warrants to purchase common stock at a weighted-average exercise price of $17.03 per share. These warrants provide for the adjustment of the number of shares issuable upon the exercise of the warrants in the event of stock splits, recapitalizations, reclassifications and consolidations. Of these warrants, warrants exercisable for 11,060 shares of common stock issuable upon the exercise of such common stock warrants outstanding as of June 30, 2015, at a weighted-average exercise price of approximately $21.50 per share, shall terminate unless exercised immediately prior to the completion of this offering.

As of June 30, 2015, warrants to purchase 98,221 shares of Series A-2 stock at an exercise price of approximately $5.19 per share were outstanding. These warrants will automatically convert to warrants to purchase an aggregate of 111,505 shares of our common stock immediately prior to the completion of this offering.

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Registration Rights

Following the completion of this offering, certain holders of our common stock, common stock issuable upon conversion of outstanding preferred stock and shares of preferred stock subject to outstanding warrants, or their transferees, will be entitled to the registration rights set forth below with respect to registration of the resale of such shares under the Securities Act pursuant to the investors’ rights agreement by and among us and certain of our stockholders. We will pay the registration expenses, other than the underwriting discounts and commissions, of the shares registered pursuant to the demand, piggyback, and Form S-3 registrations described below, including the legal fees payable to the selling holders’ counsel in connection with such registrations not to exceed $50,000.

Generally, in an underwritten offering, the managing underwriter, if any, has the right, subject to specified conditions, to limit the number of shares such holders may include. The demand, piggyback, and Form S-3 registration rights described below will expire when all holders can sell all of their shares in a 90-day period under Rule 144 of the Exchange Act, provided, however, that the registration rights of any holder holding more than 40,000 Series A-2 preferred shares, so long as such holder holds at least one percent of our outstanding capital stock, shall not terminate until seven years after the closing of this offering.

Demand Registration Rights

The holders of an aggregate of 14,444,755 shares of our common stock, common stock issuable upon conversion of outstanding preferred stock and stock subject to outstanding warrants as of June 30, 2015, will be entitled to certain demand registration rights. At any time beginning on the earlier of December 13, 2015 or 180 days following the effectiveness of this registration statement, the holders of at least 30% of these shares may, on not more than three occasions, request that we register all or a portion of their shares, subject to certain specified exceptions. Such request for registration must cover at least 20% of the registrable securities then outstanding for an aggregate offering price equal or greater than $5.0 million.

Piggyback Registration Rights

In connection with this offering, the holders of an aggregate of 14,569,167 shares of our common stock, common stock issuable upon conversion of outstanding preferred stock and stock subject to outstanding warrants as of June 30, 2015, were entitled to, and the necessary percentage of holders waived, their rights to notice of this offering and to include their shares of registrable securities in this offering. In the event that we propose to register any of our securities under the Securities Act in another offering, either for our own account or for the account of other security holders, the holders of these shares will be entitled to certain “piggyback” registration rights allowing them to include their shares in such registration, subject to certain marketing and other limitations. As a result, whenever we propose to file a registration statement under the Securities Act, including a registration statement on Form S-3 as discussed below, other than with respect to a demand registration or a registration statement relating solely to employee benefit plans, related to the offer and sale of debt securities, a registration relating to a corporate reorganization or transaction covered by Rule 145 under the Securities Act, or any registration that does not permit secondary sales, the holders of these shares are entitled to notice of the registration and have the right, subject to limitations that the underwriters may impose on the number of shares included in the registration, to include their shares in the registration.

S-3 Registration Rights

The holders of an aggregate of 14,569,167 shares of our common stock, stock issuable upon conversion of outstanding preferred stock and stock subject to outstanding warrants as of June 30, 2015, will be entitled to certain Form S-3 registration rights. Holders of these shares can make a request that we register their shares on Form S-3 if we are qualified to file a registration statement on Form S-3, subject to specified exceptions. Such request for registration on Form S-3 must cover securities with an aggregate offering price which equals or exceeds $2.0 million. We will not be required to effect more than two registrations on Form S-3 within any 12-month period.

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Anti-Takeover Effects of Provisions of Certificate of Incorporation, Our Bylaws and Delaware Law

Delaware Anti-Takeover Law

We are subject to Section 203 of the Delaware General Corporation Law, or Section 203. Section 203 generally prohibits a public Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless:

• prior to the date of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;

• the interested stockholder owned at least 85% of the voting stock of the corporation outstanding upon consummation of the transaction, excluding for purposes of determining the number of shares outstanding (a) shares owned by persons who are directors and also officers and (b) shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

• on or subsequent to the consummation of the transaction, the business combination is approved by the board and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested stockholder.

Section 203 defines a business combination to include:

• any merger or consolidation involving the corporation and the interested stockholder;

• any sale, transfer, pledge or other disposition involving the interested stockholder of 10% or more of the assets of the corporation;

• subject to exceptions, any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder;

• subject to exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder; and

• the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.

In general, Section 203 defines an interested stockholder as any entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with or controlling or controlled by the entity or person.

Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws

Because our stockholders do not have cumulative voting rights, our stockholders holding a majority of the voting power of our shares of common stock outstanding will be able to elect all of our directors. Our amended and restated certificate of incorporation and amended and restated bylaws to be effective upon the completion of this offering will provide that all stockholder actions must be effected at a duly called meeting of stockholders and not by written consent. A special meeting of stockholders may be called by the majority of our whole board of directors, chair of the board of directors or our chief executive officer.

As described above in “Management—Board Composition,” in accordance with our amended and restated certificate of incorporation effective upon the completion of this offering, our board of directors will be divided into three classes with staggered three-year terms.

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In addition, our amended and restated certificate of incorporation and amended and restated bylaws will provide that the number of directors constituting our board of directors will be permitted to be set only by a resolution adopted by a majority vote of our entire board of directors, and that our directors may be removed only for cause. Our amended and restated certificate of incorporation and amended and restated bylaws will also provide that vacancies occurring on our board of directors and newly created directorships resulting from an increase in the authorized number of directors may be filled only by vote of a majority of the remaining members of our board of directors, even though less than a quorum. Our amended and restated certificate of incorporation and amended and restated bylaws will provide that our board of directors is expressly authorized to adopt, amend or repeal our bylaws, and require a supermajority stockholder vote to amend our bylaws and certain provisions of our certificate of incorporation.

Our amended and restated bylaws will provide advance notice procedures for stockholders seeking to bring business before our annual meeting of stockholders or to nominate candidates for election as directors at our annual meeting of stockholders. Our amended and restated bylaws will also specify certain requirements regarding the form and content of a stockholder’s notice. These provisions might preclude our stockholders from bringing matters before our annual meeting of stockholders or from making nominations for directors at our annual meeting of stockholders if the proper procedures are not followed. We expect that these provisions may also discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company.

The foregoing provisions will make it more difficult for our existing stockholders to replace our board of directors as well as for another party to obtain control of us by replacing our board of directors. Since our board of directors has the power to retain and discharge our officers, these provisions could also make it more difficult for existing stockholders or another party to effect a change in management. In addition, the authorization of undesignated preferred stock makes it possible for our board of directors to issue preferred stock with voting or other rights or preferences that could impede the success of any attempt to change our control.

These provisions are intended to enhance the likelihood of continued stability in the composition of our board of directors and its policies and to discourage certain types of transactions that may involve an actual or threatened acquisition of us. These provisions are also designed to reduce our vulnerability to an unsolicited acquisition proposal and to discourage certain tactics that may be used in proxy fights. However, such provisions could have the effect of discouraging others from making tender offers for our shares and may have the effect of deterring hostile takeovers or delaying changes in our control or management. As a consequence, these provisions also may inhibit fluctuations in the market price of our stock that could result from actual or rumored takeover attempts.

Choice of Forum

Our amended and restated certificate of incorporation will provide that the Court of Chancery of the State of Delaware will be the exclusive forum for any derivative action or proceeding brought on our behalf; any action asserting a breach of fiduciary duty; any action asserting a claim against us arising pursuant to the Delaware General Corporation Law, our amended and restated certificate of incorporation or our bylaws; or any action asserting a claim against us that is governed by the internal affairs doctrine. The enforceability of similar choice of forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be inapplicable or unenforceable.

Listing

We have applied to have our common stock listed on the NASDAQ Global Market under the symbol “EASI.”

Transfer Agent and Registrar

The transfer agent and registrar for our common stock is Computershare Trust Company, N.A. The transfer agent and registrar’s address is 250 Royall Street, Canton, Massachusetts 02021.

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SHARES ELIGIBLE FOR FUTURE SALE

Immediately prior to this offering, there has been no public market for our common stock. Future sales of substantial amounts of common stock in the public market could adversely affect prevailing market prices. Furthermore, since only a limited number of shares will be available for sale shortly after this offering because of contractual and legal restrictions on resale described below, sales of substantial amounts of common stock in the public market after the restrictions lapse could adversely affect the prevailing market price for our common stock as well as our ability to raise equity capital in the future.

Based on the number of shares of common stock outstanding as of June 30, 2015, upon the completion of this offering,              shares of common stock will be outstanding, assuming (1) no exercise of the underwriters’ option to purchase additional shares to cover any over-allotments, if any, and (2) no exercise of outstanding options or warrants. All of the shares sold by us and the selling stockholders in this offering will be freely tradable unless purchased by our “affiliates” as that term is defined in Rule 144 under the Securities Act or purchased by existing stockholders and their affiliated entities who are subject to lock-up agreements. The remaining              shares of common stock outstanding after this offering will be restricted as a result of securities laws or lock-up agreements. These remaining shares will generally become available for sale in the public market as follows:

• No restricted shares will be eligible for immediate sale upon the completion of this offering; and

• Up to              restricted shares will be eligible for sale under Rule 144 or Rule 701, subject to the volume limitations, manner of sale and notice provisions described below under “Rule 144,” upon expiration of lock-up agreements at least 180 days after the date of this offering.

Rule 144

In general, under Rule 144 as currently in effect, beginning 90 days after the effective date of the registration statement of which this prospectus is a part, any person who is not an affiliate of ours and has held their shares for at least six months, including the holding period of any prior owner other than one of our affiliates, may sell shares without restriction, provided current public information about us is available. In addition, under Rule 144, any person who is not an affiliate of ours and has held their shares for at least one year, including the holding period of any prior owner other than one of our affiliates, would be entitled to sell an unlimited number of shares immediately upon the completion of this offering without regard to whether current public information about us is available.

Beginning 90 days after the effective date of the registration statement of which this prospectus is a part, a person who is an affiliate of ours and who has beneficially owned restricted securities for at least six months, including the holding period of any prior owner other than one of our affiliates, is entitled to sell a number of restricted shares within any three-month period that does not exceed the greater of:

• 1% of the number of shares of our common stock then outstanding, which will equal approximately shares immediately after this offering; or

• the average weekly trading volume of our common stock on during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.

Sales of restricted shares under Rule 144 held by our affiliates are also subject to requirements regarding the manner of sale, notice and the availability of current public information about us. Rule 144 also provides that affiliates relying on Rule 144 to sell shares of our common stock that are not restricted shares must nonetheless comply with the same restrictions applicable to restricted shares, other than the holding period requirement.

Notwithstanding the availability of Rule 144, the holders of substantially all of our restricted shares have entered into lock-up agreements as described below and their restricted shares will become eligible for sale at the expiration of the restrictions set forth in those agreements.

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Rule 701

Under Rule 701, shares of our common stock acquired upon the exercise of currently outstanding options or pursuant to other rights granted under our stock plans may be resold by:

• persons other than affiliates, beginning 90 days after the effective date of the registration statement of which this prospectus is a part, subject only to the manner-of-sale provisions of Rule 144; and

• our affiliates, beginning 90 days after the effective date of the registration statement of which this prospectus is a part, subject to the manner-of-sale and volume limitations, current public information and filing requirements of Rule 144, in each case, without compliance with the six-month holding period requirement of Rule 144.

As of June 30, 2015, options to purchase a total of 3,404,994 shares of common stock were outstanding, of which 2,380,685 were vested. Of the total number of shares of our common stock issuable under these options, substantially all are subject to contractual lock-up agreements with us or the underwriters described below under “Underwriting” and will become eligible for sale in accordance with Rule 701 at the expiration of those agreements.

Lock-Up Agreements

We, along with our directors, executive officers and substantially all of our other stockholders, optionholders, convertible noteholders and warrantholders, including the selling stockholders, have agreed with the underwriters that for a period of 180 days (the restricted period), after the date of this prospectus, subject to specified exceptions, we or they will not offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of common stock or any securities convertible into or exercisable or exchangeable for shares of common stock, or enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the common stock. Upon expiration of the “restricted” period, certain of our stockholders and warrantholders will have the right to require us to register their shares under the Securities Act. See “—Registration Rights” below and “Description of Capital Stock—Registration Rights.”

After this offering, certain of our employees, including our executive officers and/or directors, may enter into written trading plans that are intended to comply with Rule 10b5-1 under the Exchange Act. Sales under these trading plans would not be permitted until the expiration of the lock-up agreements relating to the offering described above.

Registration Rights

Upon the completion of this offering, the holders of an aggregate of 14,569,167 shares of our common stock as of June 30, 2015, including shares of our common stock issuable upon exercise of outstanding warrants, will be entitled to rights with respect to the registration of their shares under the Securities Act, subject to the lock-up agreements described under “—Lock-Up Agreements” above. Registration of these shares under the Securities Act would result in the shares becoming freely tradable without restriction under the Securities Act, except for shares purchased by affiliates, immediately upon the effectiveness of the registration statement of which this prospectus is a part. Any sales of securities by these stockholders could have a material adverse effect on the trading price of our common stock. See “Description of Capital Stock—Registration Rights.”

Equity Incentive Plans

We intend to file with the SEC a registration statement on Form S-8 under the Securities Act covering the shares of common stock reserved for issuance under the 2015 plan and the 2015 ESPP. The registration statement is expected to be filed and become effective as soon as practicable after the completion of this offering. Accordingly, shares registered under the registration statement will be available for sale in the open market following its effective date, subject to Rule 144 volume limitations and the lock-up agreements described above, if applicable.

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MATERIAL U.S. FEDERAL INCOME AND ESTATE TAX CONSEQUENCES

TO NON-U.S. HOLDERS OF OUR COMMON STOCK

The following is a summary of certain material U.S. federal income tax considerations relating to the acquisition, ownership, and disposition of common stock pursuant to this offering. This summary deals only with common stock held as a capital asset (within the meaning of Section 1221 of the Code) by a holder and does not discuss the U.S. federal income tax considerations applicable to a holder that is subject to special treatment under U.S. federal income tax laws, including, but not limited to: a dealer in securities or currencies; a financial institution; a regulated investment company; a real estate investment trust; a tax-exempt organization; an insurance company; a person holding common stock as part of a hedging, integrated, conversion, or straddle transaction or a person deemed to sell common stock under the constructive sale provisions of the Code; a trader in securities that has elected the mark-to-market method of accounting; a person liable for alternative minimum tax or the Medicare contribution tax; an entity that is treated as a partnership for U.S. federal income tax purposes; a person that received such common stock in connection with services provided; a U.S. person whose “functional currency” is not the U.S. dollar; a “controlled foreign corporation;” a “passive foreign investment company;” or a U.S. expatriate.

This summary is based upon provisions of the Code, applicable U.S. Treasury regulations promulgated thereunder, published rulings, and judicial decisions, all as in effect as of the date hereof. We have not sought, and will not seek, any ruling from the Internal Revenue Service, or IRS, with respect to the tax consequences discussed herein, and there can be no assurance that the IRS will not take a position contrary to the tax consequences discussed below or that any position taken by the IRS would not be sustained. Those authorities may be changed, perhaps retroactively, or may be subject to differing interpretations, which could result in U.S. federal income tax consequences different from those discussed below. This summary does not address all aspects of U.S. federal income tax, does not deal with all tax considerations that may be relevant to stockholders in light of their personal circumstances, and does not address the Medicare tax imposed on certain investment income or any state, local, foreign, gift, estate (except to the limited extent set forth herein), or alternative minimum tax considerations.

For purposes of this discussion, a “U.S. holder” is a beneficial holder of common stock that is: an individual citizen or resident of the United States; a corporation (or any other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia; an estate the income of which is subject to U.S. federal income taxation regardless of its source; or a trust if it (i) is subject to the primary supervision of a court within the United States and one or more U.S. persons have the authority to control all substantial decisions of the trust or (ii) has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person.

For purposes of this discussion a “non-U.S. holder” is a beneficial holder of common stock that is neither a U.S. holder nor a partnership (or any other entity or arrangement that is treated as a partnership) for U.S. federal income tax purposes. If a partnership (or an entity or arrangement that is treated as a partnership for U.S. federal income tax purposes) holds common stock, the tax treatment of a partner will generally depend upon the status of the partner and the activities of the partnership. A partner of a partnership holding common stock is urged to consult its own tax advisors.

PROSPECTIVE INVESTORS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS CONCERNING THEIR PARTICULAR U.S. FEDERAL INCOME TAX CONSEQUENCES IN LIGHT OF THEIR SPECIFIC SITUATIONS, AS WELL AS THE TAX CONSEQUENCES ARISING UNDER ANY STATE, LOCAL, OR NON-U.S. TAX LAWS AND ANY OTHER U.S. FEDERAL TAX LAWS (INCLUDING THE U.S. FEDERAL ESTATE AND GIFT TAX LAWS).

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Distributions on our Common Stock

Distributions with respect to common stock, if any, generally will constitute dividends for U.S. federal income tax purposes to the extent paid out of current or accumulated earnings and profits, as determined for U.S. federal income tax purposes. Any portion of a distribution in excess of current or accumulated earnings and profits will be treated as a return of capital and will first be applied to reduce the holder’s tax basis in its common stock, but not below zero. Any remaining amount will then be treated as gain from the sale or exchange of the common stock and will be treated as described under the section entitled “—Disposition of our Common Stock” below.

Distributions treated as dividends that are paid to a non-U.S. holder, if any, with respect to shares of our common stock will be subject to U.S. federal withholding tax at a rate of 30% (or lower applicable income tax treaty rate) of the gross amount of the dividends unless the dividends are effectively connected with the non-U.S. holder’s conduct of a trade or business in the United States. If a non-U.S. holder is engaged in a trade or business in the United States and dividends with respect to the common stock are effectively connected with the conduct of that trade or business and, if required by an applicable income tax treaty, are attributable to a U.S. permanent establishment, then although the non-U.S. holder will generally be exempt from the 30% U.S. federal withholding tax, provided certain certification requirements are satisfied, the non-U.S. holder will be subject to U.S. federal income tax on those dividends on a net income basis at regular graduated U.S. federal income tax rates in the same manner as if such holder were a resident of the United States. Any such effectively connected income received by a foreign corporation may, under certain circumstances, be subject to an additional branch profits tax equal to 30% (or lower applicable income tax treaty rate) of its effectively connected earnings and profits for the taxable year, as adjusted under the Code. To claim the exemption from withholding with respect to any such effectively connected income, the non-U.S. holder must generally furnish to us or our paying agent a properly executed IRS Form W-8ECI (or applicable successor form).

A non-U.S. holder of shares of common stock who wishes to claim the benefit of a reduced rate of withholding tax under an applicable treaty must furnish to us or our paying agent a valid IRS Form W-8BEN or IRS Form W-8BEN-E (or applicable successor form) certifying such holder’s qualification for the exemption or reduced rate. If a non-U.S. holder is eligible for a reduced rate of U.S. withholding tax pursuant to an income tax treaty, it may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS. Non-U.S. holders are urged to consult their tax advisors regarding their entitlement to benefits under a relevant income tax treaty.

Disposition of our Common Stock

Non-U.S. holders may recognize gain upon the sale, exchange, redemption, or other taxable disposition of common stock. Subject to the discussion below regarding backup withholding and foreign accounts, such gain generally will not be subject to U.S. federal income tax unless: (i) that gain is effectively connected with the non-U.S. holder’s conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, is attributable to a U.S. permanent establishment maintained by the non-U.S. holder); (ii) the non-U.S. holder is a nonresident alien individual who is present in the United States for 183 days or more in the taxable year of that disposition, and certain other conditions are met; or (iii) we are or have been a “U.S. real property holding corporation” for U.S. federal income tax purposes at any time during the shorter of the five-year period preceding the date of disposition or the holder’s holding period for our common stock, and certain other requirements are met. We believe that we are not and we do not anticipate becoming a “U.S. real property holding corporation” for U.S. federal income tax purposes.

If a non-U.S. holder is an individual described in clause (i) of the preceding paragraph, the non-U.S. holder will generally be subject to tax on a net income basis at the regular graduated U.S. federal individual income tax rates in the same manner as if such holder were a resident of the United States, unless an applicable income tax treaty provides otherwise. In addition, the non-U.S. holder may be subject to the branch profits tax at a rate equal to 30% (or lower applicable income tax treaty rate) of its effectively connected earnings and profits. If the non-U.S. holder is an individual described in clause (ii) of the preceding paragraph, the non-U.S. holder will generally

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be subject to a flat 30% tax on the gain, which may be offset by U.S. source capital losses even though the non-U.S. holder is not considered a resident of the United States, provided that the non-U.S. holder has timely filed U.S. federal income tax returns with respect to such losses.

U.S. Federal Estate Tax

The estate of a nonresident alien individual is generally subject to U.S. federal estate tax on property having a U.S. situs. Because we are a U.S. corporation, our common stock will be U.S. situs property and therefore will be included in the taxable estate of a nonresident alien decedent, unless an applicable estate tax treaty between the United States and the decedent’s country of residence provides otherwise.

Information Reporting and Backup Withholding Tax

We report to our non-U.S. holders and the IRS the amount of dividends paid during each fiscal year and the amount of any tax withheld. All distributions to holders of common stock are subject to any applicable withholding. Information reporting requirements apply even if no withholding was required because the distributions were effectively connected with the non-U.S. holder’s conduct of a U.S. trade or business or withholding was reduced by an applicable income tax treaty. This information also may be made available under a specific treaty or agreement with the tax authorities in the country in which the non-U.S. holder resides or is established. Under U.S. federal income tax law, interest, dividends, and other reportable payments may, under certain circumstances, be subject to “backup withholding” at the then applicable rate (currently, 28%). Backup withholding, however, generally will not apply to distributions on our common stock to a non-U.S. holder, provided the non-U.S. holder furnishes to us or our paying agent the required certification as to its non- U.S. status, such as by providing a valid IRS Form W-8BEN, IRS Form W-8BEN-E or IRS Form W-8ECI, or certain other requirements are met. Notwithstanding the foregoing, backup withholding may apply if either we or our paying agent has actual knowledge, or reason to know, that the holder is a U.S. person that is not an exempt recipient. Backup withholding is not an additional tax but merely an advance payment, which may be refunded to the extent it results in an overpayment of tax and the appropriate information is timely supplied to the IRS.

Foreign Accounts

New rules in the Code may impose withholding taxes on certain types of payments made to “foreign financial institutions” (as specially defined under these rules) and certain other non-U.S. entities if certification, information reporting and other specified requirements are not met. The legislation potentially imposes a 30% withholding tax on “withholdable payments” if they are paid to a foreign financial institution or to a foreign nonfinancial entity, unless (i) the foreign financial institution undertakes certain diligence and reporting obligations and other specified requirements are satisfied or (ii) the foreign non-financial entity either certifies it does not have any substantial U.S. owners or furnishes identifying information regarding each substantial U.S. owner and other specified requirements are satisfied. “Withholdable payment” generally means (i) any payment of interest, dividends, rents, and certain other types of generally passive income if such payment is from sources within the United States, and (ii) any gross proceeds from the sale or other disposition of any property of a type that can produce interest or dividends from sources within the United States (including, for example, stock and debt of U.S. corporations). If the payee is a foreign financial institution, it must enter into an agreement with the U.S. Treasury requiring, among other things, that it undertake to identify accounts held by certain U.S. persons or U.S.-owned foreign entities, annually report certain information about such accounts and withhold 30% on payments to account holders whose actions prevent it from complying with these reporting and other requirements. An applicable intergovernmental agreement between the United States and a foreign jurisdiction may modify the foregoing rules. If an investor does not provide us with the information necessary to comply with the legislation, it is possible that distributions to such investor that are attributable to withholdable payments, such as dividends, will be subject to the 30% withholding tax. Withholding on certain passive income, such as dividends and interest, began on July 1, 2014. The IRS has issued guidance indicating that withholding with respect to all other withholdable payments will be required after December 31, 2016. Prospective investors should consult their own tax advisers regarding this legislation.

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UNDERWRITING

Under the terms and subject to the conditions in an underwriting agreement dated the date of this prospectus, the underwriters named below, for whom Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc. are acting as representatives, have severally agreed to purchase from us and the selling stockholders, and we and the selling stockholders have agreed to sell to them, severally, the number of shares indicated below:

Name	Number of Shares
Morgan Stanley & Co. LLC
Deutsche Bank Securities Inc.
Raymond James & Associates, Inc.
Robert W. Baird & Co. Incorporated
William Blair & Company, L.L.C.
Roth Capital Partners, LLC
Northland Securities, Inc.
Total:

The underwriters and the representatives are collectively referred to as the “underwriters” and the “representatives,” respectively. The underwriters are offering the shares of common stock subject to their acceptance of the shares from us and the selling stockholders and subject to prior sale. The underwriting agreement provides that the obligations of the several underwriters to pay for and accept delivery of the shares of common stock offered by this prospectus are subject to the approval of certain legal matters by their counsel and to certain other conditions. The underwriters are obligated to take and pay for all of the shares of common stock offered by this prospectus if any such shares are taken. However, the underwriters are not required to take or pay for the shares covered by the underwriters’ over-allotment option described below.

The underwriters initially propose to offer part of the shares of common stock directly to the public at the offering price listed on the cover page of this prospectus and part to certain dealers, at such offering price less a selling concession not in excess of $         per share. After the initial offering of the shares of common stock, the offering price, and other selling terms may from time to time be varied by the representatives. The offering of the shares by the underwriters is subject to receipt and acceptance and subject to the underwriters’ right to reject any order in whole or in part.

The underwriters have an option, exercisable for 30 days from the date of this prospectus, to purchase up to              additional shares of common stock from us at the public offering price listed on the cover page of this prospectus, less underwriting discounts and commissions. The underwriters may exercise this option solely for the purpose of covering over-allotments, if any, made in connection with the offering of the shares of common stock offered by this prospectus. To the extent the option is exercised, each underwriter will become obligated, subject to certain conditions, to purchase about the same percentage of the additional shares of common stock as the number listed next to the underwriter’s name in the preceding table bears to the total number of shares of common stock listed next to the names of all underwriters in the preceding table.

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The following table shows the per share and total public offering price, underwriting discounts and commissions, and proceeds before expenses to us and the selling stockholders. These amounts are shown assuming both no exercise and full exercise of the underwriters’ option to purchase up to an additional              shares of common stock.

		Total
	Per Share	No Exercise	Full Exercise
Public offering price	$	$	$
Underwriting discounts and commissions to be paid by us
Underwriting discounts and commissions to be paid by the selling stockholders
Proceeds, before expenses, to us
Proceeds, before expenses, to the selling stockholders

The estimated offering expenses payable by us, exclusive of the underwriting discounts and commissions, are approximately $        , which includes legal, accounting and printing costs, and various other fees associated with the registration and listing of our common stock. We have agreed to reimburse the underwriters for certain FINRA related expenses incurred by them in connection with the offering, up to $30,000 as set forth in the underwriting agreement.

The underwriters have informed us that they do not intend sales to discretionary accounts to exceed 5% of the total number of shares of common stock offered by them.

We have applied to have our common stock listed on the NASDAQ Global Market under the trading symbol “EASI.”

We, all of our directors and officers, and the holders of substantially all of our common stock and securities exercisable for or convertible into our common stock outstanding immediately prior to this offering, including the selling stockholders, have agreed that, without the prior written consent of each of Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc. on behalf of the underwriters, we and they will not, during the period ending 180 days after the date of this prospectus (restricted period):

• offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of common stock or any securities convertible into or exercisable or exchangeable for shares of common stock;

• file any registration statement with the Securities and Exchange Commission relating to the offering of any shares of common stock or any securities convertible into or exercisable or exchangeable for common stock; or

• enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the common stock.

Whether any such transaction described above is to be settled by delivery of common stock or such other securities, in cash or otherwise. In addition, we and each such person agrees that, without the prior written consent of Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc. on behalf of the underwriters, we or such other person will not, during the restricted period, make any demand for, or exercise any right with respect to, the registration of any shares of common stock or any security convertible into or exercisable or exchangeable for common stock.

The restrictions described in the immediately preceding paragraph do not apply to:

• the sale of shares to the underwriters;

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• the issuance by the Company of shares of common stock upon the exercise of an option or a warrant or the conversion of a security outstanding on the date of this prospectus of which the underwriters have been advised in writing;

• transactions by any person other than us relating to shares of common stock or other securities acquired in open market transactions after the completion of the offering of the shares; provided that no filing under Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is required or voluntarily made in connection with subsequent sales of the common stock or other securities acquired in such open market transactions; or

• the establishment of a trading plan pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of common stock, provided that (i) such plan does not provide for the transfer of common stock during the restricted period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required or voluntarily made regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of common stock may be made under such plan during the restricted period.

Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc., in their sole discretion, may release the common stock and other securities subject to the lock-up agreements described above in whole or in part at any time with or without notice, provided that notice shall be provided as required by applicable law, rule or regulation.

In order to facilitate the offering of the common stock, the underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of the common stock. Specifically, the underwriters may sell more shares than they are obligated to purchase under the underwriting agreement, creating a short position. A short sale is covered if the short position is no greater than the number of shares available for purchase by the underwriters under the over-allotment option. The underwriters can close out a covered short sale by exercising the over-allotment option or purchasing shares in the open market. In determining the source of shares to close out a covered short sale, the underwriters will consider, among other things, the open market price of shares compared to the price available under the over-allotment option. The underwriters may also sell shares in excess of the over-allotment option, creating a naked short position. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the common stock in the open market after pricing that could adversely affect investors who purchase in this offering. As an additional means of facilitating this offering, the underwriters may bid for, and purchase, shares of common stock in the open market to stabilize the price of the common stock. The underwriters may also impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the representatives have repurchased shares sold by or for the account of such underwriter in stabilizing or short covering transactions.

These activities may raise or maintain the market price of the common stock above independent market levels or prevent or retard a decline in the market price of the common stock. The underwriters are not required to engage in these activities and may end any of these activities at any time.

We, the selling stockholders and the several underwriters have agreed to indemnify each other against certain liabilities, including liabilities under the Securities Act.

A prospectus in electronic format may be made available on websites maintained by one or more underwriters participating in this offering. The representatives may agree to allocate a number of shares of common stock to underwriters for sale to their online brokerage account holders. Internet distributions will be allocated by the representatives to underwriters that may make Internet distributions on the same basis as other allocations.

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The underwriters and their respective affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging. financing and brokerage activities. Certain of the underwriters and their respective affiliates may in the future perform various financial advisory and investment banking services for us, for which they will receive customary fees and expenses.

In addition, in the ordinary course of their various business activities, the underwriters and their respective affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers and may at any time hold long and short positions in such securities and instruments. Such investment and securities activities may involve our securities and instruments. The underwriters and their respective affiliates may also make investment recommendations or publish or express independent research views in respect of such securities or instruments and may at any time hold, or recommend to clients that they acquire, long or short positions in such securities and instruments.

Pricing of the Offering

Prior to this offering, there has been no public market for our common stock. The initial public offering price was determined by negotiations between us and the representatives. Among the factors considered in determining the initial public offering price were our future prospects and those of our industry in general, our sales, earnings and certain other financial and operating information in recent periods, and the price-earnings ratios, price-sales ratios, market prices of securities, and certain financial and operating information of companies engaged in activities similar to ours.

Selling Restrictions

European Economic Area

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a Relevant Member State) an offer to the public of any shares of our common stock may not be made in that Relevant Member State, except that an offer to the public in that Relevant Member State of any shares of our common stock may be made at any time under the following exemptions under the Prospectus Directive, if they have been implemented in that Relevant Member State:

(a) to any legal entity which is a qualified investor as defined in the Prospectus Directive;

(b) to fewer than 100 or, if the Relevant Member State has implemented the relevant provision of the 2010 PD Amending Directive, 150, natural or legal persons (other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive, subject to obtaining the prior consent of the representatives for any such offer; or

(c) in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of shares of our common stock shall result in a requirement for the publication by us or any underwriter of a prospectus pursuant to Article 3 of the Prospectus Directive.

For the purposes of this provision, the expression an “offer to the public” in relation to any shares of our common stock in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and any shares of our common stock to be offered so as to enable an investor to decide to purchase any shares of our common stock, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State, the expression “Prospectus Directive” means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State, and the expression “2010 PD Amending Directive” means Directive 2010/73/EU.

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United Kingdom

Each underwriter has represented and agreed that:

(a) it has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets Act 2000 (FSMA) received by it in connection with the issue or sale of the shares of our common stock in circumstances in which Section 21(1) of the FSMA does not apply to us; and

(b) it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the shares of our common stock in, from or otherwise involving the United Kingdom.

Hong Kong

The shares may not be offered or sold by means of any document other than (i) in circumstances which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), (ii) to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap.571, Laws of Hong Kong) and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a “prospectus” within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), and no advertisement, invitation, or document relating to the shares may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder.

Singapore

This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (SFA), (ii) to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA, or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

Where the shares are subscribed or purchased under Section 275 by a relevant person which is: (a) a corporation (which is not an accredited investor) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or (b) a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary is an accredited investor, shares, debentures and units of shares, and debentures of that corporation, or the beneficiaries’ rights and interest in that trust shall not be transferable for six months after that corporation or that trust has acquired the shares under Section 275 except: (1) to an institutional investor under Section 274 of the SFA or to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA; (2) where no consideration is given for the transfer; or (3) by operation of law.

Japan

The securities have not been and will not be registered under the Financial Instruments and Exchange Law of Japan (the Financial Instruments and Exchange Law) and each underwriter has agreed that it will not offer or

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sell any securities, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to a resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Law and any other applicable laws, regulations and ministerial guidelines of Japan.

Notice to Prospective Investors in Switzerland

The shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange (SIX) or on any other stock exchange or regulated trading facility in Switzerland. This document has been prepared without regard to the disclosure standards for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in Switzerland. Neither this document nor any other offering or marketing material relating to the shares or the offering may be publicly distributed or otherwise made publicly available in Switzerland.

Neither this document nor any other offering or marketing material relating to the offering, the Company, the shares have been or will be filed with or approved by any Swiss regulatory authority. In particular, this document will not be filed with, and the offer of shares will not be supervised by, the Swiss Financial Market Supervisory Authority FINMA (FINMA), and the offer of shares has not been and will not be authorized under the Swiss Federal Act on Collective Investment Schemes (CISA). The investor protection afforded to acquirers of interests in collective investment schemes under the CISA does not extend to acquirers of shares.

Notice to Prospective Investors in the Dubai International Financial Centre

This prospectus relates to an Exempt Offer in accordance with the Offered Securities Rules of the Dubai Financial Services Authority (DFSA). This prospectus is intended for distribution only to persons of a type specified in the Offered Securities Rules of the DFSA. It must not be delivered to, or relied on by, any other person. The DFSA has no responsibility for reviewing or verifying any documents in connection with Exempt Offers. The DFSA has not approved this prospectus nor taken steps to verify the information set forth herein and has no responsibility for the prospectus. The shares to which this prospectus relates may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of the shares offered should conduct their own due diligence on the shares. If you do not understand the contents of this prospectus you should consult an authorized financial advisor.

Notice to Prospective Investors in Australia

No placement document, prospectus, product disclosure statement or other disclosure document has been lodged with the Australian Securities and Investments Commission (ASIC), in relation to the offering. This prospectus does not constitute a prospectus, product disclosure statement or other disclosure document under the Corporations Act 2001 (Corporations Act), and does not purport to include the information required for a prospectus, product disclosure statement or other disclosure document under the Corporations Act.

Any offer in Australia of the shares may only be made to persons (Exempt Investors) who are “sophisticated investors” (within the meaning of section 708(8) of the Corporations Act), “professional investors” (within the meaning of section 708(11) of the Corporations Act) or otherwise pursuant to one or more exemptions contained in section 708 of the Corporations Act so that it is lawful to offer the shares without disclosure to investors under Chapter 6D of the Corporations Act.

The shares applied for by Exempt Investors in Australia must not be offered for sale in Australia in the period of 12 months after the date of allotment under the offering, except in circumstances where disclosure to

152

investors under Chapter 6D of the Corporations Act would not be required pursuant to an exemption under section 708 of the Corporations Act or otherwise or where the offer is pursuant to a disclosure document which complies with Chapter 6D of the Corporations Act. Any person acquiring shares must observe such Australian on-sale restrictions.

This prospectus contains general information only and does not take account of the investment objectives, financial situation or particular needs of any particular person. It does not contain any securities recommendations or financial product advice. Before making an investment decision, investors need to consider whether the information in this prospectus is appropriate to their needs, objectives and circumstances, and, if necessary, seek expert advice on those matters.

153

LEGAL MATTERS

The validity of the shares of common stock being offered by this prospectus will be passed upon for us by Cooley LLP, Palo Alto, California. Pillsbury Winthrop Shaw Pittman LLP, Palo Alto, California, is acting as counsel to the underwriters in connection with certain legal matters relating to the shares of common stock offered by the prospectus.

EXPERTS

The consolidated financial statements as of December 31, 2013 and 2014, and for each of the three years in the period ended December 31, 2014, included in this prospectus, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing herein. Such consolidated financial statements have been so included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

We have filed with the SEC a registration statement on Form S-1, including exhibits and schedules, under the Securities Act, with respect to the shares of common stock being offered by this prospectus. This prospectus, which constitutes part of the registration statement, does not contain all of the information in the registration statement and its exhibits. For further information with respect to us and the common stock offered by this prospectus, we refer you to the registration statement and its exhibits. Statements contained in this prospectus as to the contents of any contract or any other document referred to are not necessarily complete, and in each instance, we refer you to the copy of the contract or other document filed as an exhibit to the registration statement. Each of these statements is qualified in all respects by this reference.

You can read our SEC filings, including the registration statement, over the Internet at the SEC’s website at www.sec.gov. You may also read and copy any document we file with the SEC at its public reference facilities at 100 F Street, NE, Washington, D.C. 20549. You may also obtain copies of these documents at prescribed rates by writing to the Public Reference Section of the SEC at 100 F Street, NE, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference facilities. You may also request a copy of these filings, at no cost, by writing us at 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

Upon the completion of this offering, we will be subject to the information reporting requirements of the Securities Exchange Act of 1934 and we will file reports, proxy statements and other information with the SEC. These reports, proxy statements and other information will be available for inspection and copying at the public reference room and web site of the SEC referred to above. We also maintain a website at www.easic.com, at which, following the completion of this offering, you may access these materials free of charge as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. Information contained on or accessible through our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only.

154

eASIC CORPORATION

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Page
Report of Independent Registered Public Accounting Firm		F-2
Consolidated Balance Sheets		F-3
Consolidated Statements of Operations		F-4
Consolidated Statements of Preferred Stock and Stockholders’ Deficit		F-5
Consolidated Statements of Cash Flows		F-7
Notes to Consolidated Financial Statements		F-8

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders:

eASIC Corporation

Santa Clara, California

We have audited the accompanying consolidated balance sheets of eASIC Corporation and its subsidiaries (the “Company”) as of December 31, 2013 and 2014, and the related consolidated statements of operations, preferred stock and stockholders’ deficit and cash flows for each of the three years in the period ended December 31, 2014. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of eASIC Corporation and subsidiaries as of December 31, 2013 and 2014, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2014, in conformity with accounting principles generally accepted in the United States of America.

/s/ DELOITTE & TOUCHE LLP

San Jose, California

February 19, 2015

F-2

eASIC CORPORATION

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

	As of December 31,						March 31, 2015			Pro Forma as of March 31, 2015
	2013			2014
							(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	7,423		$	8,790		$	9,222
Accounts receivable, net of allowance for doubtful accounts		6,762			13,871			13,322
Inventories, net		6,795			11,267			7,279
Prepaid expenses and other current assets		1,033			827			1,064
Total current assets		22,013			34,755			30,887
Property and equipment, net		2,356			6,600			6,397
Other assets		543			1,763			3,895
Total assets	$	24,912		$	43,118		$	41,179
Liabilities, preferred stock and stockholders’ deficit
Current liabilities:
Accounts payable	$	3,683		$	9,808		$	6,585
Term loans, current portion		—			818			1,792
Accrued expenses and other current liabilities		1,835			4,178			4,426
Deferred revenues		1,152			321			374
Total current liabilities		6,670			15,125			13,177
Convertible preferred stock warrant liabilities		271			1,203			1,042		$	—
Revolving line of credit		4,950			7,950			7,950
Term loans, non-current portion		5,798			7,999			7,074
Vendor financing arrangement		1,381			1,280			1,302
Income taxes payable		—			3,081			3,079
Other non-current liabilities		64			289			243
Total liabilities		19,134			36,927			33,867			32,825
Commitments and contingencies (Note 5)
Preferred stock:
Convertible and non-convertible preferred stock, par value of $0.001 per share; 490,000,000 shares authorized as of December 31, 2013 and 2014 and March 31, 2015 (unaudited); 5,065,963 shares issued and outstanding with liquidation preference of $63,533 as of December 31, 2013 and 2014 and March 31, 2015 (unaudited), actual; no shares issued and outstanding, pro forma		41,286			41,286			41,286			—
Total preferred stock		41,286			41,286			41,286			—
Stockholders’ equity (deficit):
Common stock, par value of $0.001 per share; 1,575,000,000 shares authorized as of December 31, 2013 and 2014 and March 31, 2015 (unaudited); 9,454,962 and 9,868,802 and 9,909,735 shares issued and outstanding as of December 31, 2013 and 2014 and March 31, 2015 (unaudited) actual; and 15,055,418 shares issued and outstanding, pro forma (unaudited)		9,765			11,325			11,740			54,068
Accumulated deficit		(45,273	)		(46,420	)		(45,714	)		(45,714	)
Total stockholders’ equity (deficit)		(35,508	)		(35,095	)		(33,974	)	$	8,354
Total liabilities, preferred stock and stockholders’ equity (deficit)	$	24,912		$	43,118		$	41,179

See notes to consolidated financial statements.

F-3

eASIC CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
										(Unaudited)
Revenues:
Product	$	11,843		$	26,111		$	65,086		$	12,265		$	19,658
Service		1,840			3,666			2,294			1,312			417
Total revenues		13,683			29,777			67,380			13,577			20,075
Cost of revenues:
Product		8,707			14,968			37,366			7,040			11,178
Service		373			748			636			420			190
Total cost of revenues		9,080			15,716			38,002			7,460			11,368
Gross profit		4,603			14,061			29,378			6,117			8,707
Operating expenses:
Research and development		11,898			13,026			13,870			3,038			3,701
Sales and marketing		4,494			4,834			5,711			1,183			1,331
General and administrative		2,543			3,076			5,449			746			2,491
Total operating expenses		18,935			20,936			25,030			4,967			7,523
Income (loss) from operations		(14,332	)		(6,875	)		4,348			1,150			1,184
Interest expense		(1,042	)		(935	)		(1,443	)		(301	)		(445	)
Other income (expense), net		72			12			(836	)		(88	)		(38	)
Income (loss) before income taxes		(15,302	)		(7,798	)		2,069			761			701
Benefit from (provision for) income taxes		(57	)		(44	)		(3,216	)		(360	)		5
Net income (loss)		(15,359	)		(7,842	)		(1,147	)	$	401		$	706
Add/(Less): Capital contribution from/(deemed dividend to) common stockholders		83,386			(338	)		—			—			—
Less: Undistributed earnings allocated to preferred stockholders		—			—			—			(401	)		(706	)
Net income (loss) attributable to common stockholders	$	68,027		$	(8,180	)	$	(1,147	)	$	—		$	—
Net income (loss) per share attributable to common stockholders:
Basic	$	213.75		$	(0.90	)	$	(0.12	)	$	0.00		$	0.00
Diluted	$	(4.06	)	$	(0.90	)	$	(0.12	)	$	0.00		$	0.00
Weighted-average common shares used in computing net income (loss) per share attributable to common stockholders:
Basic		318,249			9,066,797			9,518,377			9,436,046			9,682,424
Diluted		3,786,303			9,066,797			9,518,377			9,436,046			9,682,424
Pro forma net income (loss) attributable to common stockholders (unaudited)							$	(364	)				$	545
Pro forma net income (loss) per share attributable to common stockholders (unaudited):
Basic							$	(0.02	)				$	0.04
Diluted							$	(0.02	)				$	0.03
Pro forma weighted-average common shares used in computing net income (loss) per share attributable to common stockholders (unaudited):
Basic								14,664,060						14,828,107
Diluted								14,664,060						17,828,111

See notes to consolidated financial statements.

F-4

eASIC CORPORATION

CONSOLIDATED STATEMENTS OF PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT

(In thousands, except share data)

	Convertible and non-convertible preferred stock														Stockholders’ deficit
	Convertible preferred stock (Series A - H)						Non-convertible preferred stock (Series A-1)				Convertible preferred stock (Series A-2)				Convertible preferred stock (Series A - H)						Common stock					Accumulated deficit			Total
	Shares			Amount			Shares		Amount		Shares		Amount		Shares			Amount			Shares		Amount			Amount			Amount
Balances, January 1, 2012		3,076,113		$	109,953			—	$	—		—	$	—		—		$	—			129,136	$	1,933		$	(107,685	)	$	(105,752	)
Extinguishment and reclassification of convertible preferred stock into equity upon elimination of the liquidation preference for Series A, B, C, D, E, F, F-1, G and H convertible preferred stock		(3,076,113	)		(109,953	)		—		—		—		—		3,076,113			26,567			—		—			83,386			109,953
Issuance of Series A-1 and A-2 preferred stock and common stock for cash of $2.3 million and notes of $4 million, and conversion of Series C, D, E, F, F-1, G and H preferred stock to common stock, net of issuance costs of $0.2 million		—			—			337,177		15,036		1,217,597		4,024		(429,997	)		(15,569	)		4,173,696		2,768			—			(12,801	)
Series A preferred stock surrendered		—			—			—		—		—		—		(1,481	)		(11	)		—		11			—			—
Options exercised		—			—			—		—		—		—		—			—			10,635		24			—			24
Stock-based compensation		—			—			—		—		—		—		—			—			—		141			—			141
Net loss		—			—			—		—		—		—		—			—			—		—			(15,359	)		(15,359	)
Balances, December 31, 2012		—			—			337,177		15,036		1,217,597		4,024		2,644,635			10,987			4,313,467		4,877			(39,658	)		(23,794	)
Issuance of Series A-1 and A-2 preferred stock and common stock, net of issuance costs of $0.1 million, and conversion of Series C, D, E, F, F-1, G and H preferred stock to common stock		—			—			196,124		8,779		708,315		2,349		(287,990	)		(5,800	)		2,443,794		(937	)		—			(6,737	)
Expiration of exchange purchase options and conversion of Series C, D, E, F, F-1, G and H preferred stock to common stock		—			—			—		—		—		—		(2,356,645	)		(5,187	)		2,652,620		5,187			—			—

F-5

	Convertible and non-convertible preferred stock													Stockholders’ deficit
	Convertible preferred stock (Series A - H)				Non-convertible preferred stock (Series A-1)					Convertible preferred stock (Series A-2)				Convertible preferred stock (Series A - H)				Common stock					Accumulated deficit			Total
	Shares		Amount		Shares		Amount			Shares		Amount		Shares		Amount		Shares			Amount		Amount			Amount
Reclassification in connection with conversion of warrants for preferred stock into warrants for common stock		—		—		—		—			—		—		—		—		—			4		—			4
Issuance of Series A-2 preferred stock, net of issuance costs of $0.1 million		—		—		—		—			390,344		1,202		—		—		—			—		727			727
Modification of rights of outstanding Series A-1 and A-2 preferred stock		—		—		—		(6,032	)		—		5,281		—		—		—			—		751			751
Issuance of Series A-2 preferred stock, net of issuance costs of $0.04 million		—		—		—		—			1,925,947		9,246		—		—		—			—		642			642
Issuance of Series A-2 preferred stock on conversion of convertible notes plus accrued interest		—		—		—		—			290,459		1,401		—		—		—			—		107			107
Options exercised		—		—		—		—			—		—		—		—		45,081			77		—			77
Stock-based compensation		—		—		—		—			—		—		—		—		—			557		—			557
Net loss		—		—		—		—			—		—		—		—		—			—		(7,842	)		(7,842	)
Balances, December 31, 2013		—		—		533,301		17,783			4,532,662		23,503		—		—		9,454,962			9,765		(45,273	)		(35,508	)
Options exercised		—		—		—		—			—		—		—		—		451,779			193		—			193
Cancellation of founder shares in connection with non payment of notes		—		—		—		—			—		—		—		—		(37,939	)		—		—			—
Vesting of early exercised stock options		—		—		—		—			—		—		—		—		—			33		—			33
Stock-based compensation		—		—		—		—			—		—		—		—		—			1,334		—			1,334
Net loss		—		—		—		—			—		—		—		—		—			—		(1,147	)		(1,147	)
Balances,December 31, 2014		—	$	—		533,301	$	17,783			4,532,662	$	23,503		—	$	—		9,868,802		$	11,325	$	(46,420	)	$	(35,095	)
Options exercised and shares issued (unaudited)		—		—		—		—			—		—		—		—		40,933			38		—			38
Vesting of early exercised stock options (unaudited)								—			—		—						—			29		—			29
Stock-based compensation (unaudited)		—		—		—		—			—		—		—		—		—			348		—			348
Net income (unaudited)		—		—		—		—			—		—		—		—		—			—		706			706
Balances, March 31, 2015 (unaudited)		—	$	—		533,301	$	17,783			4,532,662	$	23,503		—	$	—		9,909,735		$	11,740	$	(45,714	)	$	(33,974	)

See notes to consolidated financial statements.

F-6

eASIC CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
Cash flows from operating activities:											(Unaudited)
Net income (loss)	$	(15,359	)	$	(7,842	)	$	(1,147	)	$	401		$	706
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Stock-based compensation		243			1,319			1,334			86			348
Depreciation and amortization		480			546			907			149			427
Amortization of debt discount		235			273			309			66			86
Change in fair value of preferred stock warrant liability		(127	)		(34	)		783			41			(161	)
Loss on disposal of property and equipment		126			224			522			31			98
Other non-cash operating activity		—			303			—			—			—
Changes in operating assets and liabilities:
Accounts receivable, net		(112	)		(3,450	)		(7,109	)		(1,369	)		549
Inventories, net		1,450			(5,450	)		(4,472	)		320			3,988
Prepaid expenses and other current assets		(21	)		309			165			282			(245	)
Other assets		17			(43	)		10			9			601
Accounts payable		1,336			997			5,391			708			(4,355	)
Accrued expenses and other current liabilities		296			(88	)		1,683			139			(629	)
Deferred revenues		1,032			(529	)		(831	)		(930	)		53
Non-current income taxes payable		—			—			3,081			—			(3	)
Other non-current liabilities		(38	)		(13	)		(84	)		(7	)		(2	)
Net cash provided by (used in) operating activities		(10,442	)		(13,478	)		542			(74	)		1,461
Cash flows from investing activities:
Purchases of property and equipment		(524	)		(2,129	)		(5,316	)		(1,778	)		(361	)
Purchases of other assets		—			—			(101	)		—			—
Net cash used in investing activities		(524	)		(2,129	)		(5,417	)		(1,778	)		(361	)
Cash flows from financing activities:
Payments on capital lease obligations		—			—			(41	)		—			(41	)
Payments on vendor financing arrangement		(106	)		(446	)		(191	)		(76	)		—
Proceeds from term loans and revolving line of credit		5,025			21,728			5,975			—			—
Repayments of term loans and revolving line of credit		(7,892	)		(18,140	)		—			—			—
Proceeds from issuance of bridge notes		4,069			1,500			—			—			—
Net proceeds from issuance of stock		2,108			15,508			—			—			—
Proceeds from exercise of stock options		24			77			547			5			38
Payment of initial public offering costs		—			—			(48	)		—			(665	)
Net cash provided by (used in) financing activities		3,228			20,227			6,242			(71	)		(668	)
Net increase (decrease) in cash and cash equivalents		(7,738	)		4,620			1,367			(1,923	)		432
Cash and cash equivalents, beginning of period		10,541			2,803			7,423			7,423			8,790
Cash and cash equivalents, end of period	$	2,803		$	7,423		$	8,790		$	5,500		$	9,222
Supplemental disclosures of cash flow information:
Cash paid during the period for interest	$	643		$	547		$	1,103		$	233		$	360
Cash paid during the period for income taxes	$	56		$	49		$	71		$	14		$	100
Supplemental disclosures of cash flows from investing and financing activities:
Property and equipment acquired included in accounts payable and accrued liabilities	$	74		$	165		$	108		$	82		$	61
Property and equipment acquired included in capital lease obligations	$	—		$	—		$	404		$	—		$	—
Extinguishment and reclassification of convertible preferred stock into equity upon elimination of the liquidation preference for Series A, B, C, D, E, F, F-1, G and H convertible preferred stock	$	83,386		$	—		$	—		$	—		$	—
Conversion of Series C, D, E, F, F-1, G and H convertible preferred stock to common stock	$	348		$	213		$	—		$	—		$	—
Series A preferred stock surrendered for no consideration	$	11		$	—		$	—		$	—		$	—
Exchange of stockholders’ notes payable, including accrued interest, as investment in connection with Series A-2 financing	$	4,050		$	1,500		$	—		$	—		$	—
Expiration of exchange purchase options and conversion of Series C, D, E, F, F-1, G and H convertible preferred stock to common stock	$	—		$	5,187		$	—		$	—		$	—
Reclassification in connection with conversion of warrants for preferred stock into warrants for common stock	$	—		$	4		$	—		$	—		$	—
Capital contribution representing the excess of fair value of shares purchased over cash and stockholders’ notes payable exchanged in the Series A-2 financings	$	—		$	1,476		$	—		$	—		$	—
Modification of rights of outstanding Series A-1 and A-2 preferred stock	$	—		$	751		$	—		$	—		$	—
Deferred initial public offering costs in accounts payable and accrued liabilities	$	—		$	—		$	1,076		$	—		$	2,080
Issuance of warrants for preferred stock	$	—		$	235		$	149		$	—		$	—

See notes to consolidated financial statements.

F-7

eASIC CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Description of business and summary of significant accounting principles

Description of business

eASIC Corporation was incorporated in the state of Delaware on October 28, 1999. The Company has pioneered a differentiated solution that enables the Company to rapidly and cost-effectively deliver custom integrated circuits (ICs), creating value for its customers’ hardware and software systems. The Company’s eASIC solution consists of eASIC platform which incorporates a versatile, pre-defined and re-usable base array and customizable single-mask layer, the easicopy ASICs, standard ASICs and proprietary design tools. The Company is headquartered in California and has offices in Malaysia, Romania, Japan and Bermuda.

Unaudited pro forma consolidated balance sheet

Upon the consummation of an initial public offering of at least $30.0 million in gross proceeds, all of the outstanding shares of convertible preferred stock will automatically convert into shares of common stock. The March 31, 2015 unaudited pro forma consolidated balance sheet data has been prepared assuming the conversion of the convertible preferred stock outstanding into 5,145,683 shares of common stock, the related conversion of 111,505 shares of preferred stock underlying outstanding warrants, which results in the reclassification of the warrant liability to additional paid-in capital, and the termination and cancellation of all 533,301 outstanding shares of the Company’s Series A-1 non-convertible preferred stock.

Reverse stock split

On August 6, 2014 (effective date), the Company effected a 75-to-1 reverse stock split of its common stock and preferred stock (collectively referred to as capital stock). On the effective date of the reverse stock split, (i) each 75 shares of outstanding capital stock was reduced to 1 share of capital stock; (ii) the number of shares of capital stock into which each outstanding warrant or option to purchase capital stock is exercisable was proportionately reduced on a 75-to-1 basis; and (iii) the exercise price of each outstanding warrant or option to purchase capital stock was proportionately increased on a 75-to-1 basis. All of the share and per share amounts have been adjusted, on a retroactive basis, to reflect this 75-to-1 reverse stock split.

Certain significant risks and uncertainties

The Company is an “emerging growth company” as defined in the Jumpstart our Business Startups Act (JOBS Act), has a limited history of profitability, and positive cash flows and is dependent on its existing cash and cash equivalents and debt facilities for liquidity. The Company is also subject to common risks and uncertainties in technology driven markets and those specific to the semiconductor industry.

Basis of presentation and principles of consolidation

Consolidation. The consolidated financial statements include the accounts of eASIC Corporation and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In preparing the consolidated financial statements as of December 31, 2014 and for the year then ended, subsequent events were evaluated from the balance sheet date of December 31, 2014 through the audited consolidated financial statements original issuance date of February 19, 2015. For the three months ended March 31, 2015, subsequent events were evaluated through April 21, 2015, the date these interim consolidated financial statements were issued.

Adoption of new or revised accounting standards. The Company is an emerging growth company and can take advantage of an extended transition period for complying with new or revised accounting standards.

F-8

However, the Company has irrevocably elected not to avail the extended transition period and, as a result, the Company will comply with new or revised accounting standards as other public companies that are not emerging growth companies.

Unaudited interim financial information

The accompanying interim consolidated balance sheet as of March 31, 2015, including pro forma thereof, the related interim consolidated statements of operations and cash flows for the three month periods ended March 31, 2014 and 2015, the statement of preferred stock and stockholders’ deficit for the three month period ended March 31, 2015, and the related footnote disclosures are unaudited. These unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) applicable to interim financial statements. The interim financial statements are presented in accordance with the rules and regulations of the Securities and Exchange Commission and do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with U.S. GAAP. In management’s opinion, the unaudited interim consolidated financial statements have been prepared on the same basis as the annual financial statements and include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of March 31, 2015 and the Company’s consolidated results of operations and cash flows for the three months ended March 31, 2014 and 2015. The results for the three months ended March 31, 2015 are not necessarily indicative of the results expected for the year ending December 31, 2015.

Use of estimates

The preparation of the accompanying consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Such estimates include the valuation of deferred tax assets, uncertain tax positions, useful lives of long-lived assets including manufacturing tooling, revenue recognition and stock-based compensation expense. These estimates and assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts such estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates.

Concentration of credit and other risks

Financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, revolving line of credit, term loans and vendor financing arrangement. The fair values of cash and cash equivalents, accounts receivable and accounts payable approximates their carrying value due to the nature of these instruments and short-term maturities. The Company estimates the fair value of the revolving line of credit, term loans and vendor financing arrangement by considering the current rates available to the Company for debt of the same remaining maturities and with similar characteristics, structure and terms.

Financial instruments that subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains a substantial portion of its cash and cash equivalents in checking and savings accounts with banks. Management believes that the banks that hold the Company’s cash are financially sound and, accordingly, are subject to minimal credit risk. Deposits held with banks may exceed the amount of insurance provided on such deposits. The Company generally does not require collateral or other security in support of accounts receivable. The Company periodically reviews the need for an allowance by considering factors such as historical experience, credit quality, the age of the accounts receivable balances and current economic conditions that may affect a customer’s ability to pay. As a result of the Company’s favorable collection experience and customer concentration, allowance for doubtful accounts was immaterial at December 31, 2013 and 2014 and March 31, 2015.

F-9

The customer concentrations for the Company as a percentage of total revenues were as follows:

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
										(Unaudited)
Customer A(1)		62	%		54	%		62	%		57	%		79	%
Customer B(1)		12	%		32	%		31	%		30	%		16	%
Customer C		10	%		*			*			*			*

The customer concentrations for the Company as a percentage of gross accounts receivable, based on the billing address of the customer, were as follows:

	As of December 31,						As of March 31,
	2013			2014			2015
							(Unaudited)
Customer A		66	%		*			*
Customer D(2)		28	%		12	%		*
Customer E(2)		*			75	%		84	%

* less than 10%.

(1) Sales include sales to contract manufacturers or ODMs at the direction of such end customer.

(2) Receivable from contract manufacturers or ODMs to whom sales are made at the direction of end customer.

Foreign currency translation and transactions

The Company’s foreign subsidiaries’ functional currency is the U.S. dollar. Assets and liabilities denominated in currencies other than U.S. dollars are remeasured into U.S. dollars at current exchange rates for monetary assets and liabilities and at historical exchange rates for nonmonetary assets and liabilities. Revenues, cost of revenues and expenses are remeasured at average exchange rates in effect during each reporting period. The Company includes gains and losses from the remeasurement process as well as from foreign currency transactions in the consolidated statements of operations. For the years ended December 31, 2012, 2013 and 2014 and the three months ended March 31, 2014 and 2015, foreign currency gain (loss) of $(0.1) million, $(0.02) million, $(0.04) million, $(0.05) million and $0.03 million, respectively, was included in other income (expense), net.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. As of December 31, 2013 and 2014 and March 31, 2015, cash and cash equivalents consist of cash deposited with banks and money market funds for which their cost approximates their fair value.

Comprehensive income (loss)

Comprehensive income (loss) includes all changes in equity (net assets) during a period from non-owner sources. For the years ended December 31, 2012, 2013 and 2014 and the three months ended March 31, 2014 and 2015, there were no differences between net loss and other comprehensive income (loss).

Inventories

Inventories are stated at lower of standard cost or market. Standard cost approximates actual cost determined on a first-in, first-out (FIFO) basis. The Company records inventory write-downs for potentially excess inventory based on forecasted demand, economic trends, technological obsolescence of its products and

F-10

transition of inventory related to new product releases. At the point of loss recognition, a new, lower-cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established cost basis.

Property and equipment

Property and equipment are stated at cost and are depreciated using the straight-line method over their estimated useful lives. Leasehold improvements are amortized over the shorter of their useful life or the remaining lease term. Upon retirement or sale, the cost of assets disposed of and the related accumulated depreciation are removed and any resulting gain or loss is recorded as a component of operating expenses. Repairs and maintenance costs are expensed as incurred. The estimated useful lives of property and equipment are as follows:

	Estimated Useful Lives
Equipment and software		3 years
Furniture and fixtures		3 years
Leasehold improvements		3-5 years
Manufacturing tooling		3-8 years

The Company incurs costs for the purchase of masks to manufacture the Company’s products. The Company’s eASIC platform incorporates a versatile base array and a customizable single-mask layer. If the Company determines the product technological feasibility has been achieved and estimated market demand for products using the tested array exists when costs are incurred, the costs will be capitalized as manufacturing tooling under property and equipment. If product technological feasibility has not been achieved or the mask is not expected to be utilized in production, the related mask costs are expensed as incurred to research and development (R&D). The amount capitalized is amortized to cost of sales on a straight-line basis over the estimated useful life of 8 years for the base array and 3 years for the customizable single mask layer. Amortization commences with the start of commercial production. The Company periodically reassesses the estimated useful lives of capitalized mask sets and assesses them for impairment. Impairment charges are recorded in the period that determination of the impairment occurs. Total mask costs capitalized were $1.9 million, $6.1 million and $6.3 million as of December 31, 2013 and 2014 and March 31, 2015, respectively.

Impairment of long-lived assets

The Company evaluates events and changes in circumstances that could indicate carrying amounts of long-lived assets, including property and equipment, may not be recoverable. When such events or changes in circumstances occur, an assessment is made of the recoverability of long-lived assets by determining whether or not the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the total of the future undiscounted cash flows is less than the carrying amount of an asset, the Company records an impairment charge for the amount by which the carrying amount of the assets exceeds the fair value of the asset. For the year ended December 31, 2014 and the three months ended March 31, 2014 and 2015, the Company had written down tooling and mask sets of $0.5 million, $0.03 million and $0.1 million, respectively, as a result of impairment. There were no impairment charges in prior periods.

Deferred initial public offering costs

Deferred initial public offering costs, consisting of direct and incremental legal, accounting and other fees and costs attributable to our registration statement, are capitalized. The deferred offering costs will be offset against the proceeds received upon the closing of the offering. In the event the offering does not occur in a timely manner, all of the deferred offering costs will be expensed within operations. The balance of other assets in the accompanying consolidated balance sheets as of December 31, 2014 and March 31, 2015 included $1.1 million and $3.3 million of such costs, respectively. There were no deferred offering costs capitalized at December 31, 2013 and March 31, 2014.

F-11

Product warranty

The Company’s products are sold, with a limited warranty for a period ranging from two to five years, warranting that the product conforms to specifications and is free from material defects in design, materials and workmanship. To date, the Company has had negligible returns of any defective production parts. As such, there is no accrual for warranty provision for the periods presented.

Preferred stock warrant liability

The preferred stock warrant liability is measured and recognized in the financial statements at its fair value as the warrants contain anti-dilution provisions which requires the exercise price of the warrants to be reduced upon any future down-round financing. The fair value of the warrants is estimated using an option-pricing model at each reporting date. The change in fair value of the warrants is recognized in the consolidated statements of operations as a component of other income (expense) net. Upon the earlier of the exercise of the warrants or the completion of a liquidation event, the preferred stock warrant liability will be remeasured to fair value and any remaining liability will be reclassified to stockholders’ deficit. A liquidation event includes the completion of an initial public offering in which the shares underlying the warrants convert from preferred stock into shares of common stock.

Revenue recognition

The Company earns revenues from the sale of custom ICs, design and development of ICs for customers, and related engineering services and prototypes. When the Company enters into an arrangement that includes a design and development phase and a production phase, the production revenues are recognized when production ICs are shipped.

The Company recognizes revenues when there is persuasive evidence of an arrangement, delivery has occurred, the price is fixed or determinable and collectability is reasonably assured. The delivery criterion for each type of product and service is discussed below.

Product Revenues. Product revenues are generated from sales of ICs. The Company recognizes product revenues at the time of delivery to its customers. A substantial majority of the Company’s sales are made on a VMI basis in which the Company maintains inventory of its product at a customer specific location (the hub). Title to that inventory transfers to its customer, and revenues are recognized, when the Company’s products are “pulled” from the Company’s hub locations or delivered to its customers, as needed to meet their manufacturing requirements. The Company invoices its customer when this pull transaction occurs. In addition, the Company sells to non-stocking distributors that sell directly to end-users for which the Company does not grant return privileges, except for defective products during the warranty period, nor does the Company grant pricing credits. Accordingly, the Company recognizes revenues upon transfer of title and risk of loss or damage, generally upon delivery.

Service Revenues. The Company performs design and development services for ICs to a customer’s specifications and applies the proportional performance method based on the achievement of contractual milestones. The Company has identified the acceptance of the design and prototype delivery as separate elements in the design and development arrangement. The revenues are allocated between such elements based on relative selling price. The selling price for a deliverable is based on its vendor specific evidence of fair value (VSOE) if available, third-party-evidence (TPE), if VSOE is not available, or estimated selling prices (ESP), if neither VSOE nor TPE is available. Revenues and the related costs for each of these elements are recognized up on completion of the substantive milestones. If achievement of milestones is subject to customer acceptance, such milestones are not considered achieved until customer acceptance is received. When the Company has not been able to establish VSOE or TPE for its services, the Company generally utilizes best ESP for the purposes of allocating revenues to each unit of accounting. The Company limits the amount of revenue recognition for delivered elements to the amount that is not contingent on the future delivery of products or services or future performance obligations and not subject to customer-specific return or refund privileges.

F-12

Deferred revenues consist of amounts that have been invoiced relating to service revenues but that have not been recognized as revenues in accordance with the Company’s revenue recognition policy.

At the inception of the customer arrangement, and at each reporting date thereafter, the Company estimates the total cost to complete under its arrangements. If at any point of time during the arrangement, the Company estimates the total cost to complete is higher than the arrangement price, a provision for the entire loss is recorded in the period that the estimate of a loss occurs.

The Company also derives revenues from sale of third party IP solutions. At the request of the Company’s customers, the Company procures third party IP solutions in order for them to port such third party IP solutions on the design of the ICs, the costs of which are then passed through to its customers. The determination of whether revenues should be reported on a gross or net basis is based on an assessment of whether the Company is acting as the principal or an agent in the transaction. In determining whether the Company is the principal or an agent, the Company follows the accounting guidance for principal-agent considerations. When the Company determines that it is not the primary obligor and (i) is not responsible for any development work on such third party IP, (ii) does not have any discretion to select the third party IP provider, and (iii) does not have latitude in price setting, then the Company concludes that it is the agent in these arrangements, and therefore reports revenues and cost of revenues on a net basis.

Shipping costs

Shipping costs are included in sales and marketing expense. Shipping costs were $0.1 million, $0.1 million, $0.2 million, $0.1 million and $0.01 million for the years ended December 31, 2012, 2013 and 2014 and the three months ended March 31, 2014 and 2015, respectively.

Advertising costs

Advertising costs are expensed as incurred. Advertising costs were immaterial for all periods presented.

Research and development costs

Research and development costs are charged to expense as incurred.

The Company enters into agreements with customers for shared development, under which research and development costs are eligible for reimbursement. Amounts reimbursed under these arrangements are offset against research and development expenses.

Income taxes

Deferred tax liabilities and assets are recognized for the expected future tax consequences of temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities and net operating loss and tax credit carryforwards. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

The Company uses a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. A tax position is recognized when it is more likely than not that the tax position will be sustained upon examination, including resolution of any related appeals or litigation processes. A tax position that meets the more-likely-than-not recognition threshold is measured at the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement with a taxing authority. The standard also provides guidance on derecognition of tax benefits, classification on the balance sheet, interest and penalties, accounting in interim periods, disclosure and transition.

F-13

Accounting for stock-based compensation

Compensation expense related to stock-based transactions is measured and recognized in the financial statements based on fair value. The fair value of each option award is estimated on the grant date using the Black-Scholes option-pricing model and a single option award approach. This model requires that at the date of grant the Company determines the fair value of the underlying common stock, the expected term of the award, the expected volatility of the price of the Company’s common stock, risk-free interest rates, and expected dividend yield of the Company’s common stock. The stock-based compensation expense, net of forfeitures, is recognized using a straight-line basis over the requisite service periods of the awards, which is generally four years. The Company estimates a forfeiture rate to calculate the stock-based compensation for the Company’s awards. The forfeiture rate is based on an analysis of the Company’s actual historical forfeitures.

The Company accounts for stock options issued to nonemployees based on the fair value of the awards determined using the Black-Scholes option-pricing model. The fair value of stock options granted to nonemployees is remeasured as the stock options vest, and the resulting change in value, if any, is recognized in the statement of operations during the period the related services are rendered. The stock-based compensation expense is recognized using a straight-line basis over the requisite service periods of the awards.

Net income (loss) per share

Basic net income (loss) per share attributable to common stockholders is calculated by dividing the net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Net income (loss) attributable to common stockholders is determined by allocating undistributed earnings between holders of common and convertible preferred stock, based on the contractual dividend rights of the holders of convertible preferred stock including those dividends payable on convertible preferred stock prior and in preference to the holders of common stock. Diluted net income (loss) per share attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders for purposes of calculating diluted net income (loss) per share by the weighted average number of common shares and potentially dilutive common stock equivalents outstanding for the period determined using the treasury-stock and if-converted methods. For purposes of the diluted net income (loss) per share calculation, convertible preferred stock, common stock options, and warrants are considered to be potentially dilutive securities.

Unaudited pro forma net income (loss) per share of common stock

The unaudited pro forma basic and diluted net loss per share of common stock assumes the conversion of all outstanding shares of Series A-2 convertible preferred stock as if the conversion had occurred at the beginning of the period.

Recently issued accounting standards

In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-03 — Simplifying the Presentation of Debt Issuance Costs, which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This ASU requires retrospective adoption and will be effective for the Company in the first quarter of 2016. Early adoption is permitted. The Company does not expect this adoption to have a material impact on the consolidated financial statements.

In August 2014, the FASB issued ASU 2014-15 — Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014-15 requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. In doing so, companies will have reduced diversity in the timing and content of footnote disclosures as compared to today’s

F-14

guidance. ASU 2014-15 is effective for the Company’s 2016 annual financial statements with early adoption permitted. The Company does not believe the impact of adopting ASU 2014-15 on its consolidated financial statements will be material.

In May 2014, the FASB issued ASU No. 2014-09 regarding ASC Topic 606—Revenue from Contracts with Customers. The standard provides principles for recognizing revenues for the transfer of promised goods or services to customers with the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance is effective for the Company in the first quarter of fiscal 2017 using either of two methods: (i) retrospective to each prior reporting period presented with the option to elect certain practical expedients as defined within the guidance; or (ii) retrospective with the cumulative effect of initially applying the guidance recognized at the date of initial application and providing certain additional disclosures as defined per the guidance. Early adoption is not permitted. The Company is currently evaluating the accounting, transition and disclosure requirements of the standard and cannot currently estimate the financial statement impact of adoption.

In July 2013, the FASB issued ASU 2013-11—Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (ASU 2013-11). This standard requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The adoption of ASU 2013-11 did not have a material impact on the consolidated financial statements.

2. Fair value measurements

The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which to transact and the market-based risk. The Company applies fair value accounting for all financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. The carrying amounts reported in the consolidated financial statements approximate the fair value for cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities, due to their short-term nature. The carrying amount of the Company’s preferred stock warrant liability represents their fair value, and the carrying value of the revolving line of credit and term loans approximate fair value as the stated interest rates approximate market rates currently available to the Company.

The Company categorizes assets and liabilities recorded at fair value on the Company’s consolidated balance sheets based upon the level of judgment associated with inputs used to measure their fair value. The categories are as follows:

• Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities.

• Level 2—Inputs are quoted prices for similar assets and liabilities in active markets or inputs other than quoted prices that are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments.

• Level 3—Inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value. The inputs require significant management judgment or estimation.

F-15

This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.

The following describes the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2013 and 2014 and March 31, 2015 (in thousands):

Description	Balance as of December 31, 2013		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Liabilities
Preferred stock warrant liability	$	271	$	—	$	—	$	271
Total liabilities measured at fair value	$	271	$	—	$	—	$	271

Description	Balance as of December 31, 2014		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Liabilities
Preferred stock warrant liability	$	1,203	$	—	$	—	$	1,203
Total liabilities measured at fair value	$	1,203	$	—	$	—	$	1,203

Description	Balance as of March 31, 2015 (Unaudited)		Quoted prices in active markets for identical assets/liabilities (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Liabilities
Preferred stock warrant liability	$	1,042	$	—	$	—	$	1,042
Total liabilities measured at fair value	$	1,042	$	—	$	—	$	1,042

Level 3 instruments consist solely of the Company’s preferred stock warrant liability in which the fair value was measured using an option-pricing model. As discussed further in Note 6, the preferred stock warrant liability was estimated using assumptions related to the remaining contractual term of the warrants, the risk-free interest rate and volatility of the Company’s comparable public companies over the remaining term and the fair value of underlying shares. The significant unobservable inputs used in the fair value measurement of the preferred stock warrant liability are the fair value of the underlying stock at the valuation date and the estimated term of the warrants. Generally, increases (decreases) in the fair value of the underlying stock and estimated term would result in a directionally similar impact to the fair value measurement.

F-16

The following table presents the fair value activity for the preferred stock warrant liability (in thousands):

	Level 3
Balance at January 1, 2012	$	131
Changes in fair value of preferred stock warrants		(127	)
Balance at December 31, 2012	$	4
Issuance of preferred stock warrants		235
Reclassification to additional paid-in capital		(4	)
Changes in fair value of preferred stock warrants		36
Balance at December 31, 2013	$	271
Issuance of preferred stock warrants		149
Changes in fair value of preferred stock warrants		783
Balance at December 31, 2014		1,203
Changes in fair value of preferred stock warrants (Unaudited)		(161	)
Balance at March 31, 2015 (Unaudited)	$	1,042

The convertible preferred stock warrants are subject to re-measurement at each balance sheet date, and any change in fair value is recognized as a component of other income (expense), net in the consolidated statements of operations.

3. Consolidated balance sheet components

Inventories, net

Inventories, net consisted of the following (in thousands):

	December 31,				March, 2015
	2013		2014
					(Unaudited)
Raw materials	$	359	$	745	$	82
Work-in-process		2,621		4,710		2,899
Finished goods		3,815		5,812		4,298
	$	6,795	$	11,267	$	7,279

Property and equipment, net

Property and equipment, net consisted of the following (in thousands):

	December 31,						March, 2015
	2013			2014
							(Unaudited)
Furniture and fixtures	$	137		$	136		$	135
Equipment and software		2,978			3,323			3,381
Manufacturing tooling		1,864			6,151			6,307
Leasehold improvements		194			214			214
		5,173			9,824			10,037
Less: accumulated depreciation and amortization		(2,817	)		(3,224	)		(3,640	)
	$	2,356		$	6,600		$	6,397

F-17

Depreciation and amortization expense of property and equipment was $0.5 million, $0.5 million, $0.9 million, $0.1 million and $0.4 million for the years ended December 31, 2012, 2013 and 2014 and the three months ended March 31, 2014 and 2015, respectively.

Accrued expenses and other current liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):

	December 31,				March 31,
	2013		2014		2015
					(Unaudited)
Accrued payroll and related expenses	$	741	$	1,617	$	1,263
Accrued professional fees		14		533		1,476
Other accrued liabilities		1,080		2,028		1,687
	$	1,835	$	4,178	$	4,426

4. Borrowings

In September 2010, the Company entered into a loan and security agreement, as amended at various dates from 2010 to 2014 (collectively, the Amended SVB Agreement) with Silicon Valley Bank (SVB) for a total growth capital loan of $5.0 million and advances under a revolving line of credit up to $8.0 million. The Amended SVB Agreement contains restrictive covenants, including covenants requiring the Company to meet quarterly gross revenues targets, and limiting its ability to sell property, enter into merger and acquisitions, raise new debt, and other restrictions typical of such debt. The Amended SVB Agreement contains usual and customary events of default, such as payment defaults, covenant defaults, investor abandonment, cross-default to material indebtedness and contracts, and insolvency defaults. The Company’s borrowings under the Amended SVB Agreement are secured by a lien granted with respect to substantially all of the Company’s assets, excluding intellectual property. The amendment in December 2014 provides for a change in the covenant relating to the maximum amounts that can be held in foreign deposit accounts from $0.25 million to $0.8 million and also for the extension of the maturity date for the revolving line of credit from September 30, 2015 to September 25, 2016.

Revolving line of credit

Under the terms of the Amended SVB Loan Agreement, the Company is able to borrow up to $8.0 million under the revolving line of credit. The line of credit carries a floating interest rate equal to prime plus 1.5% and matures on September 25, 2016. Borrowings under the line of credit were collateralized by all the Company’s assets, excluding intellectual property, and the availability of borrowings under the line of credit is subject to certain borrowing base limitations. Subject to reduction based upon a revenue test, the maximum amount available for borrowing under the revolving line of credit is not to exceed the lesser of $8.0 million, or 85% of eligible accounts receivable. Under the terms of the line of credit, if cash balances with SVB are less than $5 million, customer payments are applied to reduce the amounts outstanding under the revolving line of credit. At December 31, 2013 and 2014 and March 31, 2015, such cash balances exceeded the above threshold, and, accordingly, the revolving line of credit was classified as long-term liability.

Term loans

The $5.0 million growth capital loans were made under two tranches. The first $3.0 million tranche was available immediately upon execution of the Amended SVB Loan Agreement. The second $2.0 million tranche was contingent upon the Company achieving a certain milestone. Under the terms of the Amended SVB Loan Agreement, the Company borrowed $3.0 million under the growth capital facility in September 2010 and $2.0 million in January 2011. The Company paid off all the outstanding balance under the growth capital facility during September 2013.

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In April 2011, the Company entered into a loan and security agreement (GHC Loan Agreement) with Gold Hill Capital 2008 L.P. (GHC) for a total growth capital facility of $3.0 million. Under the terms of the GHC Loan Agreement, the Company borrowed $3.0 million under the growth capital facility during the year ended December 31, 2011. The Company paid off all the outstanding balance under the growth capital facility during September 2013.

In September 2013, the Company entered into a venture loan and security agreement with Horizon Technology Finance Corporation and DBD Credit Funding LLC (Original Horizon Venture Loan Agreement) and immediately borrowed the entire $6.0 million in term loans available under that facility. The Company’s borrowings under the Original Horizon Venture Loan Agreement are secured by a lien granted with respect to substantially all of the Company’s assets, excluding intellectual property. The Original Horizon Venture Loan Agreement contained usual and customary events of default, such as payment defaults, covenant defaults, material adverse change, investor abandonment, cross-default to material indebtedness, and insolvency defaults. The notes carry a fixed interest rate of 11%, with interest—only payments through and including October 1, 2015 and then equal principal and interest payments for an additional 24 months. In connection with the issuance of the notes, the Company agreed to make a final payment of $0.15 million upon maturity of the notes, which is being recorded as additional interest expense using the effective interest method over the life of the notes. There are prepayment penalties with respect to the notes. In September 2013, the Company repaid the outstanding balance of the debts owed to SVB and GHC as discussed above, using the proceeds received from the Original Horizon Venture Loan Agreement.

In September 2014, the Original Horizon Venture Loan Agreement was amended and restated (the Amended Horizon Venture Loan Agreement) mainly to make two new term loans available to the Company, and the Company immediately borrowed the entire $3.0 million in additional term loans available under the facility. The Company’s borrowings under the Amended Horizon Venture Loan Agreement are secured by a lien granted with respect to substantially all of its assets, excluding intellectual property. The Amended Horizon Venture Loan Agreement prohibits the payment of dividends and contains restrictive covenants, including covenants limiting its ability to sell property, enter into merger and acquisitions, raise new debt, and other restrictions typical of such debt. The Amended Horizon Venture Loan Agreement contains usual and customary events of default, such as payment defaults, covenant defaults, material adverse change, investor abandonment, cross-default to material indebtedness, and insolvency defaults. The notes related to the new term loans carry a fixed interest rate of 10.75%, with interest-only payments through and including October 1, 2015 and then equal principal and interest payments for an additional 30 months. In connection with the issuance of the new term loan notes, the Company agreed to make a final payment of $0.1 million with respect to such term loans, which is being recorded as additional interest expense using the effective interest method over the life of the notes. There are prepayment penalties for the new term notes. In December 2014, the Horizon Venture Loan Agreement was amended to provide for a change in the covenant relating to the maximum amounts that can be held in foreign deposit accounts from $0.25 million to $0.8 million.

Term loans consisted of the following (in thousands):

	December 31,				March 31, 2015
	2013		2014
					(Unaudited)
Horizon Venture term loans, current portion	$	—	$	818	$	1,792
Horizon Venture term loans, non-current portion		5,798		7,999		7,074
Horizon Venture term loans, total	$	5,798	$	8,817	$	8,866

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Contractual future repayments on outstanding debt obligations (amounts exclude unamortized discount of $0.2 million at December 31, 2014), not including outstanding balances under the revolving line of credit, as of December 31, 2014 are as follows (in thousands):

Years ending December 31,	Principal
2015	$	855
2016		4,040
2017		3,657
2018		448
Total	$	9,000

Term loan warrants

• In connection with the Amended SVB Loan Agreement as discussed above, in September 2010, the Company issued a warrant to purchase 12,907 shares of Series G convertible preferred stock at an exercise price of $15.495 per share. The warrants are exercisable any time at the option of the holder and expire on the earlier of the tenth anniversary of the date of issuance or upon the closing of an acquisition of the Company in which the consideration payable for such acquisition is cash, or upon the closing of an acquisition of the Company in which the consideration payable for such acquisition is publicly traded stock with a per share value of at least $46.485 per share. The warrants were initially valued at $0.1 million and recorded as a discount on the related term loans. As part of the Series A-2 Financing, which closed in January 2013, the Series G convertible preferred stock warrants converted into common stock warrants.

• In connection with the GHC Loan Agreement as discussed above, in April 2011, the Company issued a warrant to purchase 19,361 shares of Series G convertible preferred stock at an exercise price of $15.495 per share. The warrant is exercisable any time at the option of the holder and expires in April 2021. The warrant was valued at $0.2 million and recorded as a discount on the related term loans. As part of the Series A-2 Financing, which closed in January 2013, the Series G convertible preferred stock warrants converted into common stock warrants.

• In connection with the Original Horizon Venture Loan Agreement as discussed above, in September 2013, the Company issued warrants to purchase either (i) 75,111 shares of Series A-2 convertible preferred stock at an exercise price of $5.19225 per share or (ii) shares issued in the Company’s next round of preferred stock financing that results in at least $10.0 million in cash proceeds to the Company, with an exercise price equal to the per share price in the financing. The number of shares issuable after a new financing would be determined by dividing $0.4 million by the applicable exercise price. The warrants were immediately exercisable and expire at the later of ten years after issuance or five years from closing an initial public offering. The warrants were initially valued at $0.2 million and recorded as a discount on the related term loans.

• In connection with the Amended Horizon Venture Loan Agreement as discussed above, in September 2014, the Company issued warrants to purchase either (i) 23,110 shares of Series A-2 convertible preferred stock at an exercise price of $5.19225 per share or (ii) shares issued in the Company’s next round of preferred stock financing that results in at least $10.0 million in cash proceeds to the Company, with an exercise price equal to the per share price in the financing. The number of shares issuable after a new financing would be determined by dividing $0.1 million, by the applicable exercise price. The warrants were immediately exercisable and expire at the later of ten years after issuance or five years from closing an initial public offering. The warrants were initially valued at $0.1 million and recorded as a discount on the related term loans.

At December 31, 2014 and March 31, 2015, the Company was in compliance with all of the covenants under the Amended SVB Agreement and Amended Horizon Venture Agreement.

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Vendor financing arrangement

The Company has an existing arrangement, as amended, with DNP America LLC (DNP) which provides for the purchase of mask sets to be paid in over a period of time based on the actual purchase of additional mask sets over the remaining term of the agreement. The terms of the agreement initially provided for repayment of any unpaid amounts by December 2012. The terms of the agreement were modified in December 2012 as follows:

(a) The extension to December 2016 for the repayment of any unpaid amounts payable to DNP towards purchases of mask sets by the Company; and

(b) An increase in the amounts due to DNP by a total of $0.2 million repayable by the Company at a pre-determined amount at the time of purchases of subsequent mask sets and any unpaid amounts remaining due of the $0.2 million to be paid prior in January 2015.

The modification of the aggregate principal balance due to DNP with a net carrying amount of $1.4 million prior to the December 2012 modification resulted in a troubled debt restructuring accounting treatment under ASC Topic 470-60 where no gain or loss was recognized due to fact that the carrying amount of the debt balance was less than total future cash payments specified by the terms of the debt remaining unsettled after the modification. The net carrying amount due to DNP was $1.4 million and $1.3 million at December 31, 2013 and 2014, respectively.

In February 2015, the terms of the agreement have been modified as follows:

• The extension to January 2016 of the repayment of the $0.2 million discussed in (b) above repayable by the Company at a pre-determined amount at the time of purchase of subsequent mask sets to the extent any amounts remaining due of the $0.2 million.

• The extension to January 2017 for the repayment of any unpaid amounts payable to DNP towards purchase of mask sets by the Company.

The net carrying amount due to DNP was $1.3 million as of March 31, 2015.

5. Commitments and contingencies

License agreements

The Company has entered into time-based software license arrangements requiring quarterly payments through 2017. The future minimum payments under these arrangements as of December 31, 2014 were as follows (in thousands):

	Time-based licenses
Year:
2015	$	2,521
2016		1,383
2017		580
Total payments	$	4,484

Leases

The Company leases office equipment and facilities under non-cancellable operating leases with terms through year 2016. Rent expense is recognized using the straight-line method over the term of the lease.

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The aggregate future non-cancelable minimum rental payments on the Company’s operating leases, as of December 31, 2014, are as follows (in thousands):

2015	$	433
2016		387
2017		68
Total payments	$	888

Rent expense for all operating leases was $0.5 million, $0.7 million, $0.8 million, $0.2 million and $0.2 million for the years ended December 31, 2012, 2013 and 2014 and the three months ended March 31, 2014 and 2015, respectively.

In July 2014, the Company leased certain data storage equipment under a capital lease that is included in property and equipment. The total cost of this equipment, net of accumulated amortization, was $0.4 million as of December 31, 2014 and March 31, 2015.

The aggregate future non-cancelable minimum rental payments on the Company’s capital leases, as of December 31, 2014, are as follows (in thousands):

2015	$	138
2016		152
2017		114
		404
Less: Interest component		28
Present value of minimum lease payments		376
Less: Current portion of capital lease obligation (included in accrued expenses and other current liabilities)		121
Long-term portion of capital lease obligation (included in other non-current liabilities)	$	255

Litigation and indemnification

Litigation

The Company accrues for contingencies when it believes that a loss is probable and that it can reasonably estimate the amount of any such loss and the Company has made an assessment of the probability of incurring any such losses and whether or not those losses are estimable.

Although the Company is not currently subject to any litigation, and no litigation is currently threatened against the Company, the Company may be subject to legal proceedings, claims and litigation, including intellectual property litigation, arising in the ordinary course of business. Such matters are subject to many uncertainties and outcomes and are not predictable with assurance. The Company accrues amounts that it believes are adequate to address any liabilities related to legal proceedings and other loss contingencies that it believes will result in a probable loss that is reasonably estimable.

To the extent there is a reasonable possibility that a loss exceeding amounts already recognized may be incurred and the amount of such additional loss would be material, the Company will either disclose the estimated additional loss or state that such an estimate cannot be made. The Company does not currently believe that it is reasonably possible that additional losses in connection with litigation arising in the ordinary course of business would be material.

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Indemnification

Under the indemnification provisions of the Company’s standard sales related contracts, the Company agrees to defend its customers against third-party claims asserting infringement of certain intellectual property rights, which may include patents, copyrights, trademarks, or trade secrets and to pay judgments entered on such claims. The Company’s exposure under these indemnification provisions is generally limited to the total amount paid by its customer under the agreement. However, certain agreements include indemnification provisions that could potentially expose the Company to losses in excess of the amount received under the agreement. In addition, the Company indemnifies its officers, directors and certain key employees while they are serving in good faith in such capacities. As of December 31, 2014 and March 31, 2015, the Company has accrued a charge of $0.2 million for claims under indemnification provisions.

6. Preferred stock and stockholders’ deficit

Preferred stock

As of December 31, 2013 and 2014 and March 31, 2015, the Company’s outstanding preferred stock, both convertible and non-convertible, consisted of the following (in thousands, except share data):

	Shares Authorized		Shares Issued and Outstanding		Aggregate Liquidation Value		Carrying Value
Series A		—		—	$	—	$	—
Series B		—		—		—		—
Series C		—		—		—		—
Series D		—		—		—		—
Series E		—		—		—		—
Series F		—		—		—		—
Series F-1		—		—		—		—
Series G		—		—		—		—
Series H		—		—		—		—
Series A-1*		40,000,000		533,301		40,000		17,783
Series A-2		450,000,000		4,532,662		23,533		23,503
		490,000,000		5,065,963	$	63,533	$	41,286

* All classes of preferred stock are convertible except Series A-1 preferred stock which is non-convertible.

Convertible and non-convertible preferred stock

The rights, preferences and privileges of the Series A-1 non-convertible preferred stock and Series A-2 convertible preferred stock of the Company are as follows:

Dividends. Holders of the preferred stock are entitled to receive, pari passu but in preference to the common stockholders, when and as declared by the Board of Directors, but only out of funds that are legally available therefor, non-cumulative cash dividends at the annual rate of eight percent (8%) of the original issue price as follows:

• $0.41538 per share on each outstanding share of Series A-2 convertible preferred stock.

• $6.00 per share on each outstanding share of Series A-1 non-convertible preferred stock.

No dividends have been declared to date. In the event dividends are paid on common stock, then the Company shall pay an additional dividend on all outstanding preferred stock in an amount per share (on an as-if-converted to common stock basis for the Series A-2 preferred stock) equal to the amount paid or set aside for each share of common stock.

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Liquidation

In the event of liquidation, dissolution or winding-up of the Company, either voluntary or involuntary, the holders of the Series A-2 preferred stock, shall be entitled to receive, prior and in preference to any distribution to the other preferred or common holders, an amount of $5.19225 per share for each share of Series A-2 preferred stock held by them, plus all declared but unpaid dividends. If the distribution is insufficient to permit the payment to such holders of the full Series A-2 preference amount, then the entire assets and funds of the Company legally available for distribution shall be distributed ratably among the holders of the Series A-2 preferred stock, in proportion to the number of shares of Series A-2 preferred stock held by each. After payment in full to the holders of the Series A-2 preferred stock, the holders of Series A-1 non-convertible preferred stock shall be entitled to receive, prior and in preference to any distribution to the common holders, an amount of $75.00 per share for each share of Series A-1 non-convertible preferred stock, plus all declared but unpaid dividends. If the distribution is insufficient to permit the payment to such holders of the full Series A-1 amount, then it will be distributed ratably among the Series A-1 holders in proportion to the number of shares held by each. After payment in full to the holders of Series A-2 preferred stock and Series A-1 non-convertible preferred stock, the remaining assets shall be distributed among the holders of Series A-2 preferred stock and common stock, pro rata, assuming conversion of all Series A-2 preferred stock into common stock, until, with respect to the holders of Series A-2 preferred stock, such holders shall have received an amount equal to $15.57675 on such shares of Series A-2 preferred stock. Thereafter, the holders of the common stock shall receive all remaining proceeds.

Redemption

The convertible preferred stock is not redeemable.

Conversion

Holders of Series A-2 preferred stock have the option to convert each share of preferred stock into common stock (subject to adjustment for events of dilution) on a 1.13525 to one basis. The Series A-2 preferred stock shall automatically be converted into common stock upon the earlier of (i) the date specified by the vote or written consent or agreement of holders of at least two-thirds of the then outstanding shares of Series A-2 preferred stock, voting or acting together as a single class, or (ii) an underwritten public offering pursuant to an effective registration statement with an aggregate offering price of not less than $30.0 million. The Series A-1 preferred stock has no conversion rights. Upon the closing of a firm commitment underwritten public offering pursuant to an effective registration statement in which all shares of the preferred stock convert into common stock, the Series A-1 non-convertible preferred stock shall terminate and cease to have any rights, preferences or privileges without any further action.

Voting

Each share of Series A-2 Preferred Stock has voting rights equivalent to the number of shares of common stock into which such preferred shares could be converted. The Series A-1 non-convertible preferred stock has no voting rights. For the election of members of the Board of Directors, the voting is as follows:

• The holders of the Series A-2 preferred stock, voting as a single class, shall be entitled to elect four directors.

• The holders of common stock, voting as a single class, shall be entitled to elect one director.

• The holders of common stock and preferred stock, voting together as a single class on an as-if converted basis, shall be entitled to elect all remaining directors.

Series A-2 preferred stock financings and recapitalization

In December 2012, under a new Certificate of Incorporation and pursuant to the Series A-2 Stock Purchase Agreement, the holders of the Company’s existing preferred stock (Series A through Series H) were offered the

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right to participate in the $10.0 million financing, on a pro-rata basis, for a 45-day offering period that ended in January 2013. For each dollar invested in the Series A-2 financing, each holder was also entitled to exchange shares of their existing preferred stock with $4 of liquidation preference for:

• 0.0533 shares of Series A-1 non-convertible preferred stock (0.5 million shares in total).

• 0.04 shares of “bonus” common stock per share of Series A-2 preferred stock purchased.

• the number of shares of common stock into which their exchanged preferred stock was convertible.

All of the remaining preferred shares not exchanged by participating holders, and all of the preferred stockholders who elected not to participate, would be automatically converted to common stock in January 2013. In December 2012, Series A through H preferred stock lost the right to receive their original liquidation preferences upon a liquidation event, and, as a result, were considered extinguished for accounting purposes. The extinguishment resulted in a contribution of capital to the common stock of $83.4 million, which was recorded within the stockholders’ accumulated deficit. This represented the excess of the carrying amount of the Series A through H preferred stock immediately prior to the extinguishment over the sum of (1) the fair value of the common stock into which the preferred shares were convertible and (2) the fair value of the purchase options given to the preferred holders. The fair value of the purchase options was determined based on the fair value of all the shares that would be received in the exchange, minus the cash and stockholder notes payable exchanged. The contribution of capital on the extinguishment was included in the adjustment to the Company’s net loss in arriving at the net income attributable to common stockholders for the year ended December 31, 2012.

The first closing of the Series A-2 preferred financing occurred in December 2012, with the issuance of 1.2 million shares of Series A-2 convertible preferred stock, as well as 0.3 million shares of Series A-1 non-convertible preferred stock and 4.2 million shares of common stock, upon investment of $2.3 million in cash and $4.0 million in stockholder notes payable, along with the exchange of 0.4 million shares of Series C, D, E, F, F-1, G and H preferred stock.

In January 2013, the Company completed the initial round of the Series A-2 financing and issued an additional 0.7 million shares of Series A-2 preferred, 0.2 million shares of Series A-1 preferred, and 2.4 million shares of common stock, in exchange for additional cash invested of $3.7 million and 0.3 million shares of Series A, B, C, D, E, F, F-1, G and H preferred stock. This exchange included the exercise of participation rights that had been reallocated from non-participating preferred holders, and this resulted in the recognition of $0.8 million in compensation expense for holders who received reallocated rights and were employees or service providers, and a deemed dividend to the preferred stock of $2.6 million related to holders who received reallocated rights and were not employees or service providers. The deemed dividend was charged to common stock and was included in the adjustment to the Company’s net loss in arriving at the net loss attributable to common stockholders for the year ended December 31, 2013.

Also in January 2013, the unexercised purchase options expired, and all remaining shares of Series A, B, C, D, E, F, F-1, G and H preferred stock that had not been exchanged in the financing were converted to 2.7 million shares of common stock.

Subsequent Issuances of Series A-2 Preferred Stock—From January 28, 2013 to June 2013, 0.4 million additional shares of Series A-2 preferred stock were issued to investors at $5.19225 per share, for total proceeds of $2.0 million. The Company recognized a contribution of capital from the common stock of $0.7 million in the stockholders’ accumulated deficit for these purchases, representing the excess of the cash paid by investors over the fair value of the shares purchased. The contribution of capital was included in the adjustment to the Company’s net loss in arriving at the net loss attributable to common stockholders for the year ended December 31, 2013.

In July 2013, the authorized shares of Series A-2 preferred stock were increased to 450 million, and certain rights of the Series A-2 and A-1 preferred stock were modified. The Series A-2 preferred stock was given

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preference over the A-1 preferred in a liquidation, where previously the A-2 and A-1 preferred stock had been entitled to receive their liquidation preferences on a pari passu basis. In addition, the conversion ratio for Series A-2 preferred increased to 1.13525 to one, from one to one. No investor group or individual investor experienced a significant net change in the value of their holdings, and the Company accounted for the change in the terms as a modification. The Company recognized a contribution of capital from the common stock of $0.8 million in the stockholders’ accumulated deficit in connection with the modification. The contribution of capital represented the net decrease in value of the outstanding preferred stock after the modification compared to the value immediately prior to the modification and was included in the adjustment to the Company’s net loss in arriving at the net loss attributable to common stockholders for the year ended December 31, 2013.

In July 2013, the Company issued 1.9 million shares of Series A-2 preferred stock and a 90-day contingent right to warrants to purchase Series A-2 preferred shares for total proceeds of $10.0 million from an investor that is also a customer. The Company recognized a contribution of capital from the common stock of $0.6 million in the stockholders’ accumulated deficit in connection with the purchase, representing the excess of the proceeds allocated to the shares purchase of the $9.9 million over the fair value of the shares. The warrants were contingent on the Company being unsuccessful in completing an equity or debt financing of at least $3.0 million within the 90-day period. Proceeds of $0.1 million were allocated to the warrant right, reflecting the high probability that the additional financing would be completed. The warrant right expired in September 2013 upon the completion of a venture loan agreement, and a gain of $0.1 million was recognized in the consolidated statement of operations.

Also in July 2013, the Company issued 0.3 million shares of Series A-2 preferred to investors in exchange for $1.5 million in principal and interest of stockholder notes payable issued in May 2013 that had matured in June 2013. As these investors already had significant holdings of the Company’s preferred stock, the Company accounted for the exchange as an equity transaction and recognized a contribution of capital from the common stock of $0.1 million in the stockholders’ accumulated deficit. The contribution of capital represented the excess of the carrying amount of the notes and interest exchanged over the fair value of the preferred shares received, and was included in the adjustment to the Company’s net loss in arriving at the net loss attributable to common stockholders for the year ended December 31, 2013.

Equity financing warrants

The following warrants to purchase preferred stock were outstanding at December 31, 2012 and became exercisable for common stock in connection with the Series A-2 financing and recapitalization in January 2013. At that time, their carrying amount and fair value of $0.004 million was reclassified to additional paid-in-capital.

• During October 2009 through April 2010, in connection with the Company’s convertible note financing, the Company issued warrants to purchase 56,091 shares of Series G convertible preferred stock with an exercise price of $15.495 per share. The warrants are exercisable any time at the option of the holder and expire at the earlier of June 2015, the Company’s initial public offering, or an acquisition of the Company. The warrants were initially valued at $0.5 million and recorded as a discount on the related term loans. As part of the Series A-2 Financing, which closed in January 2013, the Series G convertible preferred stock warrants converted into common stock warrants.

• In connection with the Company’s Series G preferred stock financing, in June 2010, the Company issued warrants to purchase 8,601 shares of the Company’s Series G convertible preferred stock at an exercise price of $15.495 per share. The warrants were immediately exercisable and expire at the earlier of June 2015, the Company’s initial public offering, or an acquisition of the Company. The warrants were valued at $0.1 million and recorded as preferred stock issuance costs, reducing the carrying amount of the Series G preferred stock. As part of the Series A-2 Financing, which closed in January 2013, the Series G convertible preferred stock warrants converted into common stock warrants.

• In connection with the Company’s Series H preferred stock financing in 2011, the Company issued warrants to purchase 11,060 shares of the Company’s Series H convertible preferred stock at an

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exercise price of $21.495 per share. The warrants were immediately exercisable and expire on the earlier of July 2018, the Company’s initial public offering, or an acquisition of the Company. The warrants were initially valued at $0.1 million and recorded as preferred stock issuance costs, reducing the carrying amount of the Series H preferred stock. As part of the Series A-2 Financing, which closed in January 2013, the Series H convertible preferred stock warrants converted into common stock warrants.

As of the dates below, outstanding convertible preferred stock warrants and associated fair values are as follows (in thousands, except share and per share amounts):

Class of Shares	Issuance Date(s)	Expiration Date(s)	No. of Shares		Exercise Price per Share		As of December 31, 2013
Series A-2	2013	2023		75,111	$	5.19	$	271
Class of Shares	Issuance Date(s)	Expiration Date(s)	No. of Shares		Exercise Price per Share		As of December 31, 2014
Series A-2	2013-2014	2023-2024		98,221	$	5.19	$	1,203
Class of Shares	Issuance Date(s)	Expiration Date(s)	No. of Shares		Exercise Price per Share		As of March 31, 2015
							(Unaudited)
Series A-2	2013-2014	2023-2024		98,221	$	5.19	$	1,042

The fair value of the preferred stock warrants was recorded as a warrant liability. The warrant is recorded at its estimated fair value utilizing an option-pricing valuation model with changes in the fair value of the warrant liability reflected in other income (expense), net. Upon the earlier of the exercise of the warrants or the completion of a liquidation event, including the completion of an initial public offering in which the shares underlying the warrants would convert from the related shares of preferred stock into shares of common stock, the preferred stock warrant liability will be remeasured to fair value and any remaining liability will be reclassified to additional paid-in capital.

During the years ended December 31, 2012, 2013 and 2014 and the three months ended March 31, 2014 and 2015, the Company recognized income (expense) in the amount of $0.1 million, $(0.04) million, $(0.8) million, $(0.04) million and $0.2 million, respectively, from the remeasurement of the fair value of the warrants, which was recorded through other income (expense), net in the consolidated statements of operations.

At each reporting date, the Company remeasures the convertible preferred stock warrant liabilities to fair value using an option-pricing model with the following assumptions:

	December 31,						March 31, 2015
	2013			2014
							(Unaudited)
Series A-2 warrants (issued in September 2013):
Expected term (in years)		9.75			8.75			8.51
Risk-free interest rate		3.04	%		2.17	%		2.10	%
Expected volatility		44	%		45	%		45	%
Series A-2 warrants (issued in September 2014):
Expected term (in years)		—			9.70			9.46
Risk-free interest rate		—			2.17	%		2.10	%
Expected volatility		—			45	%		45	%

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Remaining contractual term—The remaining contractual term represents the time from the date of the valuation to the expiration of the warrant.

Risk-free interest rate—The risk-free interest rate is based on the U.S. Treasury yield in effect as of December 31, 2013 and 2014 and March 31, 2015 for zero coupon U.S. Treasury notes with maturities approximately equal to the term of the warrant.

Volatility—The volatility is derived from historical volatilities of several unrelated publicly listed peer companies over a period approximately equal to the term of the warrant because the Company has limited information on the volatility of the preferred stock since there is currently no trading history. When making the selections of industry peer companies to be used in the volatility calculation, the Company considered the size, operational and economic similarities to the Company’s principal business operations.

Common stock

Repurchase of common stock

During the year ended December 31, 2014, the Company canceled a total of 37,939 shares (including 16,000 fully paid shares) held by a former founder who had pledged such shares as collateral in connection with the purchase of 21,939 restricted shares with non-recourse notes amounting to $0.16 million. The notes were due for repayment in May 2014. All the 37,939 pledged shares were canceled up on non-repayment of the notes in May 2014. There were no such repurchases in the three months ended March 31, 2015.

Common stock reserved for issuance

The Company was authorized to issue 1,575,000,000 shares of common stock with a par value of $0.001 per share as of December 31, 2013 and 2014 and March 31, 2015. Each share of common stock is entitled to one vote. The holders of common stock are also entitled to receive dividends whenever funds are legally available and when declared by the Board of Directors, subject to the prior rights of holders of all classes of convertible preferred stock outstanding.

As of December 31, 2014 and March 31, 2015, the Company reserved shares of common stock for issuance as follows:

	December 31,		March 31,
	2014		2015
			(Unaudited)
Options outstanding under stock option plan		3,400,250		3,413,188
Options available for future grant under stock option plan		163,359		215,129
Conversion of preferred stock		5,145,683		5,145,683
Warrants to purchase convertible preferred stock		111,505		111,505
Warrants to purchase common stock		108,020		108,020
Total		8,928,817		8,993,525

Equity incentive plans

The Company recognizes stock-based compensation expense for all stock-based awards made to employees, nonemployees and directors, based on estimated fair values, net of an estimated forfeiture rate. The Company recognizes compensation cost for only those shares expected to vest on a straight-line basis over the requisite service period of the award.

In April 2010, the Company adopted the 2010 Equity Incentive Plan (2010 Plan), which was intended to be the successor to and continuation of the 2001 Stock Option Plan (2001 Plan) and provides for the issuance of incentive

F-28

stock options, nonqualified stock options, restricted stock awards, restricted stock units and stock appreciation rights, which may be granted to employees, non-employee directors and consultants of the Company.

Under the 2001 Plan and the 2010 Plan, incentive stock options may be granted to employees, non-employee directors and consultants at exercise prices not lower than the fair value of the stock at the date of grant as determined by the Board of Directors. For incentive stock options granted to a person who, at the time of the grant, owns stock representing more than 10% of the total combined voting power of all classes of stock of the Company, the per share exercise price must be no less than 110% of the fair value on the date of the grant as determined by the Board of Directors.

Options vest at a rate determined by the Board of Directors and will expire no later than 10 years from the date of grant. Options granted to newly hired employees typically vest over 48 months with 25% vesting after 12 months and 75% vesting ratably over the following 36 months. Grants to existing employees typically vest in equal amounts monthly over a term of 48 months.

The 2001 Plan and the 2010 Plan allow for the issuance of restricted common stock upon early exercise of nonvested stock options subject to the repurchase right of the Company. The repurchase right lapses in accordance with the vesting schedule of the original option. To date, the Company has not issued any restricted stock, restricted stock units or stock appreciation rights under the 2010 Plan.

2015 Equity Incentive Plan

In February 2015, the Company’s board of directors adopted, subject to stockholders’ approval, the 2015 Equity Incentive Plan (2015 Plan). The 2015 Plan will become effective upon the execution and delivery of the underwriting agreement related to this offering. Once the 2015 Plan is effective, no further grants will be made under the 2010 Plan. The 2015 Plan provides for the grant of incentive stock options, or ISOs, nonstatutory stock options, or NSOs, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance- based stock awards, and other forms of equity compensation, or collectively, stock awards, all of which may be granted to employees, including officers, non-employee directors and consultants of us and our affiliates. Additionally, the 2015 Plan provides for the grant of performance cash awards. ISOs may be granted only to employees. All other awards may be granted to employees, including officers, and to non-employee directors and consultants.

The Company has initially reserved 2,650,000 shares of the Company’s common stock for the issuance of awards under the 2015 Plan, plus the shares of the Company’s common stock remaining available for issuance under the Company’s 2010 Plan and any shares subject to outstanding stock options or other stock awards that were granted under the 2010 Plan that are forfeited, terminate, expire or are otherwise not issued. The 2015 Plan provides that the number of shares reserved and available for issuance under the plan will automatically increase on January 1, of each year beginning on January 1, 2016 and continuing and through and including January 1, 2025, by 5% of the outstanding number of shares of the Company’s capital stock on the immediately preceding December 31 or such lesser number of shares as determined by the Company’s board of directors. The maximum number of shares of common stock that may be issued upon the exercise of ISOs under the 2015 Plan is 31,000,000 shares.

2015 Employee Stock Purchase Plan

In February 2015, the Company’s board of directors adopted, subject to stockholders’ approval, the 2015 Employee Stock Purchase Plan (2015 ESPP). The 2015 ESPP will become effective immediately upon the execution and delivery of the underwriting agreement related to this offering. The 2015 ESPP initially reserves and authorizes the issuance of up to a total of 530,000 shares of common stock to participating employees. The 2015 ESPP provides that the number of shares reserved and available for issuance will automatically increase on January 1, beginning on January 1, 2016 through January 1, 2025, by the least of (1) 2% of the total number of

F-29

shares of our capital stock outstanding on December 31 of the preceding calendar year, (2) 600,000 shares, or (3) a number determined by our board of directors that is less than (1) and (2).

Each employee who is a participant in the 2015 ESPP may purchase shares by authorizing payroll deductions of up to 15% of his or her base compensation during an offering period. Unless the participating employee has previously withdrawn from the offering, his or her accumulated payroll deductions will be used to purchase shares on the last business day of the offering period at a price equal to 85% of the fair market value of the shares on the first business day or the last business day of the offering period, whichever is lower. Under applicable tax rules, an employee may purchase no more than $25,000 worth of shares of common stock, valued at the start of the purchase period, under the 2015 ESPP in any calendar year.

Early exercise of stock options

The Company typically allows employees to exercise options granted under the 2010 Plan prior to vesting. The unvested shares are subject to the Company’s repurchase right at the original purchase price. The proceeds initially are recorded as an accrued liability from the early exercise of stock options, and reclassified to common stock as the Company’s repurchase right lapses. There were no early exercises of stock options during the years ended December 31, 2012 and 2013. The Company has issued common stock of 231,224 shares during the year ended December 31, 2014 for stock options exercised prior to vesting. At December 31, 2014, 199,945 shares held by employees and directors were subject to repurchase at an aggregate price of $0.3 million. At March 31, 2015, 178,059 shares held by employees and directors were subject to repurchase at an aggregate price of $0.3 million.

A summary of the activity under the Company’s stock plans and changes during the reporting periods and a summary of information related to options exercisable, vested and expected to vest are presented below (in thousands, except share, per share and contractual life data):

	Shares available for future grant			Options outstanding			Weighted average exercise price		Weighted- Average Contractual Life (years)		Aggregate Intrinsic Value
Balance, January 1, 2014		718,961			2,922,812		$	0.75		9.02	$	1,096
Authorized		373,615			—			—
Options cancelled		161,867			(161,867	)		1.16
Options granted		(1,091,084	)		1,091,084			2.12
Options exercised		—			(451,779	)		1.21
Balance, December 31, 2014		163,359			3,400,250		$	1.11		8.50	$	36,320
Authorized		105,641			—			—
Options cancelled		34,629			(34,629	)		0.75
Options granted		(88,500	)		88,500			11.79
Options exercised		—			(40,933	)		0.93
Balance, March 31, 2015 (unaudited)		215,129			3,413,188		$	1.39		8.19	$	36,074
Vested and expected to vest (unaudited)					3,086,468		$	1.29		8.09	$	32,936
Options vested (unaudited)					2,150,093		$	0.79		7.61	$	24,020

The weighted-average grant date fair value per share of employee options granted during the years ended December 31, 2012, 2013 and 2014 and the three months ended March 31, 2014 and 2015 was $0.19, $0.34, $1.96, $0.80 and $5.07, respectively. The intrinsic value of the vested employee options exercised was immaterial during the years ended December 31, 2012 and 2013, $1.7 million for the year ended December 31, 2014, and $0.01 million and $0.5 million for the three months ended March 31, 2014 and 2015, respectively.

F-30

Stock-based compensation

The Company records stock-based compensation awards based on fair value as of the grant date using the Black-Scholes option-pricing model. The Company recognizes such costs as compensation expense on a straight-line basis over the employee’s requisite service period, which is generally four years. The Company determined valuation assumptions as follows:

Fair value of common stock

Given the absence of a public trading market, the Company’s Board of Directors considered numerous objective and subjective factors to determine the fair value of the Company’s common stock at each meeting at which awards were approved. These factors included, but were not limited to (i) independent contemporaneous valuations of common stock; (ii) the rights and preferences of convertible preferred stock relative to common stock; (iii) the lack of marketability of common stock; (iv) developments in the business; and (v) the likelihood of achieving a liquidity event, such as an initial public offering or sale of the Company, given prevailing market conditions.

Risk-free interest rate

The Company bases the risk-free interest rate used in the Black-Scholes option-pricing model on the implied yield available on U.S. Treasury zero-coupon issues with an equivalent expected term of the options for each option group.

Expected term

The expected term represents the period that the Company’s stock-based awards are expected to be outstanding. The expected term assumption is based on the simplified method as described in SEC Staff Accounting Bulletin No. 110, Share-Based Payment. The Company expects to continue using the simplified method until sufficient information about the Company’s historical behavior is available.

Volatility

The Company determines the price volatility factor based on the historical volatilities of the Company’s peer group as the Company did not have trading history for its common stock.

Dividend yield

The Company has never declared or paid any cash dividend and does not currently plan to pay a cash dividend in the foreseeable future. Consequently, the Company used an expected dividend yield of zero.

The following table summarizes the assumptions used in the Black-Scholes option-pricing model to determine fair value of the Company’s stock options:

	Year Ended December 31,			Three Months Ended March 31,
	2012	2013	2014	2014	2015
				(Unaudited)
Fair value per share of common	$0.75	$0.75	$1.28 – $8.83	$1.28	$11.81
Expected volatility	54%	46%	46% – 49%	49%	43%
Expected life in years	6.08	5.77 – 6.08	6.08	6.08	6.08
Risk-free interest rate	1.01% – 1.17%	1.08% – 1.35%	1.78% – 1.93%	1.78%	1.38%
Dividend yield	—	—	—	—	—

F-31

As of December 31, 2014 and March 31, 2015, total compensation cost related to unvested stock-based awards granted to employees under the Company’s stock plans but not yet recognized was $1.3 million and $1.7 million, net of estimated forfeitures, respectively. This cost is expected to be amortized on a straight-line basis over a weighted-average period of 2.57 years and 2.63 years as of December 31, 2014 and March 31, 2015, respectively. Future grants will increase the amount of compensation expense to be recorded in future periods. As of December 31, 2014 and March 31, 2015, total compensation cost related to unvested stock-based awards granted to non-employees under the Company’s stock plans was $0.8 million and $0.6 million.

Stock-based compensation expense included in the accompanying consolidated statements of operations as follows (in thousands):

	Year Ended December 31,						Three Months Ended March 31,
	2012		2013		2014		2014		2015
							(Unaudited)
Cost of product revenues	$	1	$	5	$	5	$	1	$	1
Research and development		75		256		485		33		141
Sales and marketing		17		485		286		12		70
General and administrative		150		573		558		40		136
Total stock-based compensation	$	243	$	1,319	$	1,334	$	86	$	348

Repricing of Options

During the year ended December 31, 2013, the Company repriced a total of 581,285 outstanding options by way of canceling existing outstanding option grants at an exercise price of $2.25 in exchange for new option grants at an exercise price of $0.75. Except for the change in exercise price, the new options had the same terms and conditions as the original options, including the contractual term, vesting schedule and the vesting start date. As a result of such modification, the Company expensed incremental stock compensation on the date of modification of $0.1 million relating to options that were already vested, and another $0.04 million relating to the options that were unvested was expensed over the remaining vesting term of the new options.

7. Income taxes

Provision for (benefit from) income taxes was approximately $0.4 million and $(0.01) million for the three months ended March 31, 2014 and 2015, respectively. The change in provision for income taxes and effective tax rate was primarily due to a higher proportion of the Company’s fiscal year 2015 earnings being generated from lower tax rate countries.

The Company’s book income (loss) before income taxes for the years ended December 31, 2012, 2013 and 2014 were as follows (in thousands):

	Year Ended December 31,
	2012			2013			2014
Domestic	$	(9,115	)	$	(3,668	)	$	456
Foreign		(6,187	)		(4,130	)		1,613
Total	$	(15,302	)	$	(7,798	)	$	2,069

F-32

The Company’s provision for income taxes were as follows (in thousands):

	Year Ended December 31,
	2012			2013			2014
Current:
Federal	$	—		$	—		$	3,159
State		1			—			—
Foreign		82			67			65
Total current		83			67			3,224
Deferred:
Federal		—			—			—
State		—			—			—
Foreign		(26	)		(23	)		(8	)
Total current		(26	)		(23	)		(8	)
Provision for income taxes	$	57		$	44		$	3,216

Deferred tax assets and liabilities reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets are as follows (in thousands):

	As of December 31,
	2013			2014
Deferred tax assets:
Net operating loss carryforwards	$	5,151		$	3,939
Other accruals		880			929
Research and development credits		726			721
Stock-based compensation expense		230			291
Total deferred tax assets		6,987			5,880
Valuation allowance		(6,900	)		(5,674	)
Net deferred tax assets		87			206
Deferred tax liabilities:
Accruals and reserves		(87	)		(177	)
Total deferred tax liabilities		(87	)		(177	)
Total net deferred tax assets	$	—			29

F-33

Reconciliation of the statutory federal income tax to the Company’s effective tax is as follows (in thousands):

	As of December 31,
	2012			2013			2014
Tax at statutory federal rate	$	(5,203	)	$	(2,651	)	$	704
State tax, net of federal benefit		(722	)		(76	)		(29	)
Stock compensation expense		72			376			279
Imputed interest		334			517			515
Permanent differences		(3	)		(9	)		282
Foreign tax rate differential		2,161			1,448			(492	)
Change in valuation allowance		3,437			604			(1,225	)
Tax credit not benefitted		—			(223	)		(94	)
Uncertain tax position		—			—			3,275
Other		(19	)		58			1
Provision for income taxes	$	57		$	44		$	3,216

Realization of deferred tax assets is dependent upon future earnings, if any, the timing and amount of which are uncertain. Accordingly, the net deferred tax assets have been fully offset by a valuation allowance. The valuation allowance decreased in 2014 by $1.2 million.

As of December 31, 2014, the Company had, before consideration of the Section 382 limitation discussed below, net operating loss carryforwards for federal income tax purposes of $66.6 million, which expire beginning in the year 2024 and federal research and development tax credits of $1.4 million, which expire beginning in the year 2026.

As of December 31, 2014, the Company had, before consideration of the Section 382 limitation discussed below, net operating loss carryforwards for state income tax purposes of $76.9 million which expire beginning in the year 2015 and state research and development tax credits of $1.6 million which do not expire.

Section 382 of the U.S. Internal Revenue Code generally imposes an annual limitation on the amount of net operating loss carryforwards that might be used to offset taxable income when a corporation has undergone significant changes in stock ownership. The Company performed a Section 382 analysis and believed ownership changes occurred on July 25, 2011 and December 13, 2012. The annual limitations under Section 382 are $0.1 million and $1.1 million, respectively. The Company believes that $57.7 million of the $66.6 million federal losses and $59.7 million of the $76.9 million state losses will expire unused due to Section 382 limitations. The Company will not be able to use a significant portion of the NOLs in the near term to offset tax liabilities due to the application of the annual limitation. In addition to the NOL limitation, the Company believes that $0.9 million of the $1.4 million of the federal research and development tax credit carryover will also expire unused due to the 382 limitation.

	NOLs through July 25, 2011			NOLs through December 13, 2012
	(In thousands)
Total pre-change NOLs subject to change	$	58,710		$	68,808
Total pre-change NOLs that can be used		(1,013	)		(11,111	)
Expiring NOLs	$	57,697		$	57,697

Undistributed earnings of the Company’s foreign subsidiaries amounted to approximately $1.2 million at December 31, 2014. These earnings are considered to be permanently reinvested and accordingly, no deferred US income taxes have been provided thereon.

F-34

As of December 31, 2014, the Company has unrecognized tax benefits of $4.3 million, of which $3.2 million will affect the annual effective tax rate if recognized and $1.1 million is subject to a valuation allowance and will not affect the annual effective tax rate when it is recognized.

It is the Company’s policy to recognize interest and penalties related to income tax matters in income tax expense. As of December 31, 2014, the Company had no accrued interest and penalties related to uncertain tax positions.

The Company files U.S., state and foreign income tax returns with varying statutes of limitations. The tax years from 2001 to 2014 remain open to examination due to the carryover of unused net operating losses and tax credits.

The Company does not expect any material changes to the estimated amount of liability associated with its uncertain tax positions within the next 12 months.

The following table summarizes the activity related to unrecognized tax benefits (in thousands):

	Year Ended December 31,
	2012		2013		2014
Unrecognized benefit - beginning of period	$	—	$	495	$	913
Gross increases - prior period tax positions		432		32		—
Gross increases - current period tax positions		63		386		3,432
Unrecognized benefit - end of period	$	495	$	913	$	4,345

F-35

8. Net income (loss) per share

The Company’s basic net income (loss) per share attributable to common stockholders is calculated by dividing the net income (loss) attributable to common stockholders by the weighted-average common shares outstanding for the period, without consideration for potentially dilutive securities. The diluted net income (loss) per share attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders for purposes of calculating diluted net income (loss) per share by weighted average number of common shares and potentially dilutive common stock equivalents outstanding for the period determined using the treasury-stock and if-converted methods. The following is a summary of the numerator and denominator of the basic and diluted net income (loss) per share attributable to common stockholders under the two-class method (in thousands, except share and per share data):

	Year Ended December 31,									Three Months Ended March 31,
	2012			2013			2014			2014			2015
										(Unaudited)
Numerator:
Basic:
Net income (loss)	$	(15,359	)	$	(7,842	)	$	(1,147	)	$	401		$	706
Add/(Less): Capital contribution from/(deemed dividend to) common stockholders		83,386			(338	)		—			—			—
Less: Undistributed earnings allocated to preferred stockholders		—			—			—			(401	)		(706	)
Net income (loss) attributable to common stockholders, basic	$	68,027		$	(8,180	)	$	(1,147	)	$	—		$	—
Diluted:
Net income (loss) attributable to common stockholders	$	68,027		$	(8,180	)	$	(1,147	)	$	—		$	—
Dilutive impact of capital contributions related to preferred stock transactions		(83,386	)		—			—			—			—
Net loss attributable to common stockholders, diluted	$	(15,359	)	$	(8,180	)	$	(1,147	)	$	—		$	—
Denominator:
Basic shares:
Weighted average shares used in computing net income (loss) per share attributable common stockholders, basic		318,249			9,066,797			9,518,377			9,436,046			9,682,424
Diluted shares:
Weighted average shares used in computing basic net loss per share		318,249			9,066,797			9,518,377			9,436,046			9,682,424
Effect of potentially dilutive securities convertible preferred stock (Series A-H)		3,468,054			—			—			—			—
Weighted average shares used in computing diluted net loss per share		3,786,303			9,066,797			9,518,377			9,436,046			9,682,424
Net income (loss) per share attributable to common stockholders:
Basic	$	213.75		$	(0.90	)	$	(0.12	)	$	—		$	—
Diluted	$	(4.06	)	$	(0.90	)	$	(0.12	)	$	—		$	—

F-36

The following outstanding potentially dilutive securities were excluded from the computation of diluted net income per share available to common stockholders for the periods presented because including them would have been anti-dilutive:

	Year Ended December 31,						Three Months Ended March 31,
	2012		2013		2014		2014		2015
							(Unaudited)
Stock options to purchase common stock		684,400		2,922,812		3,400,250		3,012,967		3,413,188
Convertible preferred stock		1,217,597		4,532,662		4,532,662		4,532,662		4,532,662
Convertible preferred stock warrants		108,020		75,111		98,221		75,111		98,221
Common stock warrants		—		108,020		108,020		108,020		108,020
Total		2,010,017		7,638,605		8,139,153		7,728,760		8,152,091

Unaudited pro forma net income (loss) per share

Pro forma basic and diluted net income (loss) per share have been computed to give effect, even if antidilutive, to the conversion of the Company’s preferred stock into common stock as of the beginning of the period presented or the original issuance date, if later.

The following table shows the Company’s calculation of the unaudited pro forma basic and diluted net income (loss) per share (in thousands, except per share data):

	Year Ended December 31, 2014			Three Months Ended March 31, 2015
	(Unaudited)			(Unaudited)
Numerator:
Net income (loss)	$	(1,147	)	$	706
Change in fair value of convertible preferred stock warrants		783			(161	)
Net income (loss) used in computing pro forma net income (loss) per share attributable to common stockholders, basic and diluted	$	(364	)	$	545
Denominator, basic:
Weighted average shares used in computing net income (loss) per share attributable to common stockholders, basic		9,518,377			9,682,424
Pro forma adjustment to reflect automatic conversion of convertible preferred stock		5,145,683			5,145,683
Weighted average shares used in computing pro forma net income (loss) per share attributable to common stockholders, basic		14,664,060			14,828,107
Denominator, diluted
Weighted average shares used in computing net income (loss) per share attributable to common stockholders, diluted		9,518,377			9,682,424
Pro forma adjustments to reflect automatic conversion of convertible preferred stock		5,145,683			5,145,683
Weighted average dilutive effect of options to purchase common stock		—			2,931,439
Weighted average dilutive effect of convertible preferred stock warrants		—			68,565
Weighted average shares used in computing pro forma net income (loss) per share attributable to common stockholders, diluted		14,664,060			17,828,111
Pro forma net income (loss) per share attributable to common stockholders:
Basic	$	(0.02	)	$	0.04
Diluted	$	(0.02	)	$	0.03

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9. Segment information

The Company reports information about the segments of its business based on how the information is used by the chief operating decision maker (CODM) in deciding how to allocate resources and in assessing performance. The Company has determined that it operates in a single reportable segment. The single reportable segment is based upon the Company’s internal organizational structure, the manner in which the operations are managed, the criteria used by the CODM to evaluate segment performance, and the availability of separate financial information. The following table represents the Company’s revenues based on the billing address of the customer (in thousands):

	Year Ended December 31,						Three Months Ended March 31,
	2012		2013		2014		2014		2015
							(Unaudited)
United States	$	1,199	$	788	$	1,302	$	524	$	50
Rest of Americas		821		336		166		100		—
Sweden		3,218		3,849		27,613		1,920		15,535
Estonia		1,790		7,578		6,531		2,488		*
Rest of Europe		1,258		1,838		33		33		369
China		1,614		6,680		26,519		7,509		2,614
Thailand		1,604		5,653		*		*		—
Japan		1,397		*		*		*		*
Rest of Asia Pacific		782		3,055		5,216		1,003		1,507
Total revenues	$	13,683	$	29,777	$	67,380	$	13,577	$	20,075

* less than 10%

Substantially all of the Company’s long-lived assets were attributable to operations in the United States as of December 31, 2012, 2013 and 2014 and March 31, 2014 and 2015.

10. Employee benefit plan

The Company has established a 401(k) tax-deferred savings plan (the 401(k) Plan), which permits participants to make contributions by salary deduction pursuant to Section 401(k) of the Internal Revenue Code of 1986, as amended. The Company is responsible for administrative costs of the 401(k) Plan and has made no contributions to the 401(k) Plan since inception.

11. Other related party transactions and balances

As of December 31, 2013 and 2014 and March 31, 2015, the Company had one customer that was also an investor, owning 1,925,947 shares of Series A-2 convertible preferred stock. Sales to this customer, including sales to contract manufacturers or ODMs at the direction of such customer, accounted for $1.6 million, $9.8 million and $21.0 million of revenues during the years ended December 31, 2012, 2013 and 2014, respectively, and $4.1 million and $3.2 million for the three months ended March 31, 2014 and 2015. Amounts due from this customer related to the above sales were $0.2 million as of December 31, 2012, were not significant as of December 31, 2013 and 2014 and March 31, 2014, and were $0.1 million as of March 31, 2015.

In connection with our transactions with the above customer, the Company offset against research and development expenses an amount of $0.5 million, $1.3 million and $1.5 million for the years ended December 31, 2012, 2013 and 2014, respectively, and $0 and $0.2 million for the three months ended March 31, 2014 and 2015, respectively.

The Company has also entered into consulting agreements with certain members of its Board of Directors.

F-38

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PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution.

The following table sets forth all costs and expenses, other than underwriting discounts and commissions, payable by eASIC Corporation. (the “Registrant”) in connection with the sale of the common stock being registered. All amounts shown are estimates except for the Securities and Exchange Commission (“SEC”) registration fee, the Financial Industry Regulatory Authority, Inc. (“FINRA”) filing fee and the NASDAQ Global Market listing fee.

	AMOUNT TO BE PAID
SEC registration fee	$	8,715
FINRA filing fee		11,750
NASDAQ Global Market listing fee		125,000
Printing and engraving expenses		*
Legal fees and expenses		*
Accounting fees and expenses		*
Transfer agent and registrar fees and expenses		*
Miscellaneous expenses		*
Total		*

* To be provided by amendment.

Item 14. Indemnification of Directors and Officers.

The Registrant is incorporated under the laws of the State of Delaware. Section 145 of the Delaware General Corporation Law provides that a Delaware corporation may indemnify any persons who were, are, or are threatened to be made, parties to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of such corporation), by reason of the fact that such person is or was an officer, director, employee or agent of such corporation, or is or was serving at the request of such corporation as an officer, director, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided that such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporation’s best interests and, with respect to any criminal action or proceeding, had no reasonable cause to believe that his or her conduct was illegal. A Delaware corporation may indemnify any persons who were, are, or are threatened to be made, a party to any threatened, pending or completed action or suit by or in the right of the corporation by reason of the fact that such person is or was a director, officer, employee or agent of such corporation, or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit provided such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporation’s best interests except that no indemnification is permitted without judicial approval if the officer or director is adjudged to be liable to the corporation. Where an officer or director is successful on the merits or otherwise in the defense of any action referred to above, the corporation must indemnify him or her against the expenses (including attorneys’ fees) actually and reasonably incurred.

The Registrant’s amended and restated certificate of incorporation provides for the indemnification of its directors to the fullest extent permitted under the Delaware General Corporation Law. The Registrant’s amended and restated bylaws provide for the indemnification of its directors and officers to the fullest extent permitted under the Delaware General Corporation Law. Each of the Registrant’s amended and restated certificate of incorporation and amended and restated bylaws will become effective upon the closing of this offering.

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Section 102(b)(7) of the Delaware General Corporation Law permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duties as a director, except for liability for any:

• transaction from which the director derives an improper personal benefit;

• act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

• unlawful payment of dividends or redemption of shares; or

• breach of a director’s duty of loyalty to the corporation or its stockholders.

The Registrant’s amended and restated certificate of incorporation includes such a provision. Under the Registrant’s amended and restated bylaws, expenses incurred by any director or officers in defending any such action, suit or proceeding in advance of its final disposition shall be paid by the Registrant upon delivery to it of an undertaking, by or on behalf of such director or officer, to repay all amounts so advanced if it shall ultimately be determined that such director or officer is not entitled to be indemnified by the Registrant, as long as such undertaking remains required by the Delaware General Corporation Law.

Section 174 of the Delaware General Corporation Law provides, among other things, that a director who willfully or negligently approves of an unlawful payment of dividends or an unlawful stock purchase or redemption, may be held liable for such actions. A director who was either absent when the unlawful actions were approved or dissented at the time may avoid liability by causing his or her dissent to such actions to be entered in the books containing minutes of the meetings of the board of directors at the time such action occurred or immediately after such absent director receives notice of the unlawful acts.

As permitted by the Delaware General Corporation Law, the Registrant has entered into indemnity agreements with each of its directors and officers that require the Registrant to indemnify such persons against any and all costs and expenses (including attorneys’, witness or other professional fees) actually and reasonably incurred by such persons in connection with any action, suit or proceeding (including derivative actions), whether actual or threatened, to which any such person may be made a party by reason of the fact that such person is or was a director or officer or is or was acting or serving as an officer, director, employee or agent of the Registrant or any of its affiliated enterprises. Under these agreements, the Registrant is not required to provide indemnification for certain matters, including:

• indemnification beyond that permitted by the Delaware General Corporation Law;

• indemnification for any proceeding with respect to the unlawful payment of remuneration to the director or officer;

• indemnification for certain proceedings involving a final judgment that the director or officer is required to disgorge profits from the purchase or sale of the Registrant’s stock;

• indemnification for proceedings involving a final judgment that the director’s or officer’s conduct was in bad faith, knowingly fraudulent or deliberately dishonest or constituted willful misconduct (but only to the extent of such specific determination) or a breach of his or her duty of loyalty or resulting in any personal profit or advantage to which the director or officer is not legally entitled;

• indemnification for proceedings or claims brought by an officer or director against the Registrant or any of the Registrant’s directors, officers, employees or agents, except for (i) claims to establish or enforce a right of indemnification, (ii) claims approved by the Registrant’s board of directors, or (iii) claims required by law;

• indemnification for settlements the director or officer enters into without the Registrant’s consent; or

• indemnification in violation of any undertaking required by the Securities Act of 1933, as amended (the “Securities Act”) or in any registration statement filed by the Registrant.

The indemnification agreements also set forth certain procedures that will apply in the event of a claim for indemnification thereunder.

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There is at present no pending litigation or proceeding involving any of the Registrant’s directors or executive officers as to which indemnification is required or permitted, and the Registrant is not aware of any threatened litigation or proceeding that may result in a claim for indemnification.

The Registrant has an insurance policy in place that covers its officers and directors with respect to certain liabilities, including liabilities arising under the Securities Act or otherwise.

The Registrant plans to enter into an underwriting agreement which provides that the underwriters are obligated, under some circumstances, to indemnify the Registrant’s directors, officers and controlling persons against specified liabilities, including liabilities under the Securities Act.

Item 15. Recent Sales of Unregistered Securities.

The following sets forth information regarding all unregistered securities sold by the Registrant since January 1, 2012:

(1) From January 1, 2012 to June 30, 2015, we granted stock options to purchase an aggregate of 4,388,386 shares of common stock at exercise prices ranging from $0.75 to $11.79 per share to a total of 159 employees, consultants and directors under our 2010 Plan. Of these options, options to purchase 550,598 shares have been exercised for cash consideration in the aggregate amount of $672,174, options to purchase 461,745 shares have been cancelled without being exercised and options to purchase 3,376,043 shares remain outstanding.

(2) From December 2012 through July 2013, we issued 4,532,662 shares of Series A-2 preferred stock to accredited investors at a price per share of approximately $5.20 for an aggregate purchase price of $23,534,898.

(3) From December 2012 through January 2013, in connection with the issuance and sale of Series A-2 preferred stock, we issued 533,301 shares of Series A-1 preferred stock and 9,121,442 shares of common stock to accredited investors in exchange for then outstanding preferred stock.

(4) On May 30, 2013, we issued and sold convertible promissory notes in the aggregate principal amount of $1,500,000 to accredited investors, for an aggregate purchase price of $1,500,000.

(5) From June 2012 to October 2012, we issued and sold convertible promissory notes in an aggregate principal amount of $4,068,646 to accredited investors for an aggregate purchase price of $4,068,646.

The offers, sales and issuances of the securities described in paragraphs (1) through (5) above were deemed to be exempt from registration under the Securities Act in reliance on Section 4(2) of the Securities Act and Rule 506 promulgated under Regulation D promulgated thereunder as transactions by an issuer not involving a public offering. The recipients of securities in each of these transactions acquired the securities for investment only and not with a view to or for sale in connection with any distribution thereof and appropriate legends were affixed to the securities issued in these transactions. Each of the recipients of securities in these transactions was an accredited investor within the meaning of Rule 501 of Regulation D under the Securities Act and had adequate access, through employment, business or other relationships, to information about the Registrant. No underwriters were involved in these transactions.

The offers, sales and issuances of the securities described in paragraph (1) above were deemed to be exempt from registration under the Securities Act in reliance on Rule 701 in that the transactions were under compensatory benefit plans and contracts relating to compensation as provided under Rule 701. The recipients of such securities were employees, directors or bona fide consultants of the Registrant and received the securities under the Registrant’s EIP. Appropriate legends were affixed to the securities issued in these transactions. Each of the recipients of securities in these transactions had adequate access, through employment, business or other relationships, to information about the Registrant.

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Item 16. Exhibits and Financial Statement Schedules.

(a) Exhibits.

The list of exhibits is set forth under “Exhibit Index” at the end of this registration statement and is incorporated herein by reference.

(b) Financial Statement Schedules.

No financial statement schedules are provided because the information called for is not required or is shown either in the financial statements or the notes thereto.

Item 17. Undertakings.

The undersigned Registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

The undersigned Registrant hereby undertakes that:

(a) For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

(b) For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-4

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Amendment No. 7 to Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Santa Clara, State of California, on August 10, 2015.

eASIC CORPORATION

By: /s/ Ronnie Vasishta

Ronnie Vasishta

President and Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, as amended, this Amendment No. 7 to Registration Statement on Form S-1 has been signed by the following persons in the capacities and on the dates indicated.

SIGNATURE	TITLE	DATE
/s/ Ronnie Vasishta Ronnie Vasishta	President, Chief Executive Officer and Member of the Board of Directors (Principal Executive Officer)	August 10, 2015
/s/ Richard J. Deranleau Richard J. Deranleau	Senior Vice President, Finance and Chief Financial Officer (Principal Financial and Accounting Officer)	August 10, 2015
* Wayne Cantwell	Member of the Board of Directors	August 10, 2015
* Edward H. Frank, Ph.D.	Member of the Board of Directors	August 10, 2015
* Ronald S. Jankov	Member of the Board of Directors	August 10, 2015
* Tara Long	Member of the Board of Directors	August 10, 2015

*By	/s/ Ronnie Vasishta
	Ronnie Vasishta Attorney-in-Fact

II-5

EXHIBIT INDEX

Exhibit Number	Description
1.1†	Form of Underwriting Agreement.
3.1#	Eleventh Amended and Restated Certificate of Incorporation, as amended and as currently in effect.
3.2#	Form of Twelfth Amended and Restated Certificate of Incorporation to become effective upon closing of this offering.
3.3#	Amended and Restated Bylaws, as currently in effect.
3.4#	Form of Amended and Restated Bylaws to become effective upon closing of this offering.
4.1#	Form of Common Stock Certificate of the Registrant.
4.2#	Amended and Restated Investors’ Rights Agreement, by and among the Registrant and certain of its stockholders, dated December 13, 2012.
5.1†	Opinion of Cooley LLP.
10.1#	Warrants to Purchase Common Stock issued to Investors between October 15, 2009 and January 23, 2012.
10.2#	Warrant to Purchase Series A-2 Preferred Stock issued to Investors between September 30, 2013 and September 12, 2014.
10.3#+	Form of Indemnity Agreement by and between the Registrant and its directors and officers.
10.4#+	2001 Stock Option Plan, as amended, and forms of stock option agreement, grant notice and notice of exercise.
10.5#+	2010 Equity Incentive Plan, as amended, and forms of stock option agreement, grant notice and notice of exercise.
10.6#+	2015 Equity Incentive Plan and forms of grant notice, stock option agreement and notice of exercise.
10.7#+	2015 Employee Stock Purchase Plan.
10.8†+	Non-Employee Director Compensation Policy.
10.9#+	Amended and Restated Employment Agreement by and between the Registrant and Ronnie Vasishta, dated October 15, 2010.
10.10#+	Employment Agreement by and between the Registrant and Richard J. Deranleau, dated April 28, 2014.
10.11#+	Employment Agreement by and between the Registrant and Ranko Scepanovic, Ph.D., dated April 25, 2008.
10.12#+	Employment Agreement by and between the Registrant and Michael Stacy Fender, dated May 1, 2014.
10.13#+	Employment Agreement by and between the Registrant and Jasbinder Bhoot, dated September 23, 2005.
10.14#+	Letter Agreement by and between the Registrant and Edward H. Frank, Ph.D., dated October 24, 2013.
10.15#	Lease Agreement by and between Registrant and 2525 Augustine Drive LLC dated October 31, 2011.
10.16*	Product Supply Agreement by and between the Registrant and Seagate Technology LLC, dated June 28, 2010 and as amended on May 23, 2014, including a letter agreement between the Registrant and Seagate Technology LLC.

Exhibit Number	Description
10.17*	General Purchase Agreement by and between the Registrant and Ericsson AB, dated June 18, 2009.
10.18#	Amended and Restated Venture Loan and Security Agreement by and between the Registrant and Horizon Technology Finance Corporation, Horizon Funding Trust 2013-1, DBD Credit Funding LLC and Fortress Credit Opportunities I, LP, dated September 12, 2014, as amended.
10.19	Loan and Security Agreement by and between the Registrant and Silicon Valley Bank, dated September 29, 2010, as amended.
10.20#+	Employment Agreement by and between the Registrant and Matthew Ng, dated December 11, 2014.
10.21+	Form of Change in Control and Severance Agreement by and between the Registrant and its officers.
10.22	Lease Agreement by and between the Registrant and Freedom Circle LLC dated July 20, 2015.
21.1#	Subsidiaries of the Registrant.
23.1	Consent of Deloitte & Touche LLP, an Independent Registered Public Accounting Firm.
23.2†	Consent of Cooley LLP. Reference is made to Exhibit 5.1.
24.1#	Power of Attorney. Reference is made to the signature page hereto.

# Previously filed.

† To be subsequently filed.

+ Indicates management contract or compensatory plan.

* Confidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the SEC.

EX-10.16

Exhibit 10.16

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

PRODUCT SUPPLY AGREEMENT

This Product Supply Agreement (“Agreement”) is between Seagate Technology LLC (“Seagate”) and the supplier identified below (“Supplier”). The individuals signing this Agreement represent that they are authorized to sign on behalf of their companies.

Seagate Technology LLC		eASIC Corporation
Signature:	/s/ Bruce A. Sanders	Signature:	/s/ Ronnie Vasishta
Print Name:	Bruce A. Sanders	Print Name:	Ronnie Vasishta
Title:	Vice President	Title:	President and CEO
Date:	06/28/2010	Date:	05/24/2010
Address for Notices to Seagate:	Attn: Corporate Contracts Mailstop SV15A2 Seagate Technology LLC 920 Disc Drive Scotts Valley, CA 95066	Address for Notices to Supplier:	Attn: Ronnie Vasishta 2585 Augustine Drive Suite 100 Santa Clara, CA 95054 ronnie@eASIC.com
Phone No.:	(831) 439-7288	Phone No.:	408-855-9200
Fax No.	(831) 438-7132	Fax No.	408-855-9201
Effective Date:
Expiration Date:
Agreement #:	80364

The parties agree as follows:

1. PRODUCT ORDERS

1.1 Product and Price List. Exhibit A provides a list of products (“Products”) that Seagate may purchase from Supplier and the prices that Supplier will charge. Seagate and Supplier may update the price list from time to time by agreement to reflect changes to the Products or prices.

1.2 Purchase Orders. Seagate will order Product by submitting purchase orders to Supplier. Seagate’s purchase orders will contain, at a minimum: (a) Product description; (b) quantity; (c) price; (d) Seagate’s ship-to and bill-to addresses; (e) requested delivery date; and (f) an indication whether the Product is subject to sales tax. Seagate may issue two types of purchase orders, “discrete” purchase orders and “blanket” purchase orders, as described below:

(a) Discrete Purchase Orders. A discrete purchase orders is an order for a discrete amount of Product to be delivered on a specified delivery date. Discrete purchase orders are firm commitments by Seagate, but may be cancelled or rescheduled as specified in this Agreement.

(b) Blanket Purchase Orders. A blanket purchase order is an order for an amount of Product to be determined in the future and to be delivered over a period of time. Seagate uses blanket purchase orders as an administrative convenience to track orders and to give Supplier a reference number for invoicing. Blanket purchase orders are treated as forecasts only and are non-binding on Seagate.

1.3 Order Acceptance. All orders placed under this Agreement, will be deemed accepted by Supplier unless Supplier notifies Seagate in writing to the contrary within 24 hours after receiving the order. Supplier will accept (by issuing an order acknowledgement) or reject (which may be via e-mail) a Purchase Order within 24 hours after receipt. If no acceptance or rejection is given with 24 hours, then Seagate will contact Supplier to confirm receipt of the Purchase Order.

1.4 This Agreement Controls. If the terms of this Agreement contradict the terms of any purchase order or order acceptance, the terms of this Agreement will take precedence. No boilerplate terms in either party’s order-tracking documents will apply.

1.5 Right to Incorporate and Resell. Seagate may incorporate the Products into Seagate products and may resell the Products in any market Seagate elects.

2. PRICING

2.1 Best-In-Class Prices. The Product prices offered by Supplier shall be not less favorable than prices charged by Supplier for comparable products sold to other customers under the same terms and conditions that apply to the Products sold to Seagate. Limited promotional programs and demos and sample products are excepted from this provision.

2.2 Third Party Purchasers. Seagate’s Contract Manufacturer may purchase Products directly from Supplier at the same prices as set forth in this Agreement, so long as the Contract Manufacturer purchases the products to incorporate into Seagate products; provided that (i) at Supplier’s option, Seagate and Supplier will make arrangements to mask the prices being paid by Seagate; (ii) the purchases of Products by Seagate’s Contract Manufacturer will apply against the Committed DELFOR and Long-Term Forecasts hereunder, and (iii) the payment terms between Supplier and Seagate’s Contract Manufacturer will be negotiated between them. Seagate agrees that Supplier may, if after notice to Seagate and a reasonable time to cure, withhold delivery of product to Contract Manufacturers who are delinquent in payment or in breach of other terms of the terms so agreed. Seagate’s affiliates that control, are controlled by, or are under common control with Seagate may purchase Products under this Agreement directly from Supplier at the same best in class prices and terms as described above. Unaffiliated third parties are not beneficiaries under this Agreement and are not entitled to enforce this Agreement against either party. Supplier is responsible for entering into separate agreements with any unaffiliated third parties.

2.3 Cost Reductions. Supplier will work with Seagate to reduce the costs and expenses to make and deliver the Products to Seagate. If the costs or expenses decrease, Supplier and Seagate will address any price changes.

2.4 Audit. Seagate may have a third party audit Supplier’s records to confirm that Supplier is in compliance with Section 2.1. Supplier may mask the identities of other customers to comply with its obligations of confidentiality. Seagate will give Supplier reasonable notice before any audit, and will bear the cost of the audit. If the audit discloses that Supplier has not complied with this Section 2.1, Supplier will immediately refund Seagate the difference in the amount it should have charged Seagate; and Supplier will also reimburse Seagate for the cost of the audit.

3. SHIPMENT AND DELIVERY

3.1 Incoterms. Unless specified otherwise on Exhibit A, Supplier will ship all Products to Seagate “DDU DESTINATION.”

(a) The term DDU means Delivered Duty Unpaid, as defined in International Chamber of Commerce, Incoterms 2000. Supplier will pay the costs and bear the risk of loss for any warehousing before delivery to the destination.

(b) The destination will always be the incoming dock at Seagate’s factory, regardless of whether the Products are shipped through an intermediary cross-dock facility, or stored in a “just in-time” warehouse or vendor managed inventory before delivery to the incoming dock at Seagate’s designated subcontractor.

3.2 Just-in-Time Warehouse and Supplier Managed Inventory. If requested by Seagate, Supplier will establish a “just-in-time” inventory delivery system in a Seagate-designated warehouse (“JIT

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

Warehouse”) or a “vendor managed inventory” stocking location system at a Seagate-designated location on Seagate’s premises (“SMI Stocking Location”) where Supplier will maintain an inventory of its Products. Supplier will be responsible for the costs and risk of loss for its Products at the JIT Warehouse or SMI Stocking Location. Seagate will determine a minimum level of inventory of Products to be maintained in the JIT Warehouse or SMI Stocking Location. Supplier will replenish the JIT Warehouse or SMI Stocking Location to the minimum inventory levels as Seagate pulls Products from either location. After receiving Seagate’s notice to pull Product, Supplier will have Products shipped from the JIT Warehouse or SMI Stocking Location to Seagate.

3.3 Import and Export Formalities. If Products will be exported or imported before arriving at Seagate’s final ship-to destination, Supplier will be the exporter of record and will be responsible for performing all export formalities; Seagate will be the importer of record and will be responsible for performing all import formalities. For imports to the United States, Supplier will provide the customs clearance documentation specified in Exhibit B.

3.4 On-Time Delivery. Supplier will deliver Products to Seagate on the delivery date specified in Seagate’s order. If Supplier does not deliver any Product within one day of the scheduled delivery date, then Seagate may require Supplier to ship Product by an expedited mode of transportation at Supplier’s expense. Alternatively, Seagate may purchase substitute product and charge Supplier any additional cost incurred, including the difference between a higher price charged for the substitute product and the price Seagate would have paid to Supplier for the Product.

3.5 Packaging and Marking. Supplier will mark the Products for shipment as designated by Seagate. Supplier will package the Products for shipment in accordance with standard commercial practices acceptable to common carriers at the lowest shipping rate available. Supplier’s shipping containers must display: (a) the date of shipment; (b) Seagate’s order number; (c) the Product part number; (d) the Product revision level and lot number; and (e) the quantity in the container.

3.6 Global Supply Chain Security Program Participation. Supplier will complete Seagate’s Supplier Survey as requested by Seagate. In the event that Supplier begins volume shipments of Product into the United States, upon request of Seagate Supplier agrees to pursue Customs-Trade Partnership Against Terrorism (“C-TPAT”) compliance. Seagate will notify Supplier of any change in its shipping locations that would impact this paragraph.

4. INVOICING AND PAYMENT

4.1 Invoices and Payment Terms. Supplier may invoice Seagate with each delivery, but not more frequently than as designated by Seagate’s local finance department. Payment will be due [*] days from the date Seagate receives the invoice. Seagate’s local finance department may designate specific days of the month as deadlines for submitting invoices. If Supplier submits its invoice after the local invoice deadline, then the invoice will not be deemed received by Seagate until the next invoice deadline.

4.2 Right to Offset. Seagate may offset against payments due to Supplier any amounts due to Seagate from Supplier.

5. PRODUCT SPECIFICATIONS AND CHANGES

5.1 Product Specifications. Supplier will comply with the Product descriptions and specifications referenced in Exhibit C, and any other agreed upon specifications, standard operating procedures, or processes furnished or adopted by Seagate (collectively the “Specifications”).

5.2 Specification Changes. Supplier may not change the form, fit, or function of any Product, or its manufacturing process or manufacturing location, without Seagate’s prior written approval. Seagate may change the Specifications at any time. Supplier will use commercially reasonable best efforts to comply with the changes. If Supplier

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

believes that a change will require an adjustment in Supplier’s costs or time for performance, then Supplier must request the adjustment in writing within three weeks of receiving Seagate’s change notice. Supplier shall not be required to implement the change until the Parties have agreed on revised terms.

5.3 Product Information. Supplier will provide the following information regarding the Products to Seagate upon request:

(a) a bill of materials that includes all material used in manufacturing or assembly processes;

(b) a list of component and process sub-suppliers;

(c) a complete diagram flow chart for all Products with lead-time identified for key process steps; and

(d) a description of the Product manufacturing process and a list of the equipment used in the manufacturing process.

5.4 Seagate Property. Supplier will return to Seagate any tools, drawings, or other materials provided by Seagate at the termination of this Agreement or upon Seagate’s request.

6. FORECASTS, CAPACITY PLANNING, AND FLEXIBILITY

6.1 Forecasts. Seagate will provide a thirteen week rolling forecast (“Delfor”) and a long term forecast to Supplier. Other than the quantities in the Delfor within Lead Time and the Upside Flexibility quantities maintained per Exhibit E which are binding, Seagate’s forecasts are not binding on Seagate. Supplier will secure and allocate capacity in accordance with the Delfor accepted by Supplier. Supplier will treat any Blanket Purchase Order issued by Seagate as a forecast for purposes of allocating capacity. Lead Time refers to the agreed upon number of weeks required from Order placement to the time Product is made available for shipment.

6.2 Capacity Planning. Supplier will provide a written notice to Seagate within two working days after receiving Seagate’s forecasts, confirming it will meet Seagate’s forecasts. Supplier will notify Seagate immediately if it is unable to meet any forecast. Supplier will procure and maintain all necessary equipment, personnel, facilities, and other materials required to manufacture Products according to the Specifications in volumes sufficient to meet Seagate’s forecasts. At Seagate’s request, Supplier will meet with Seagate to plan Supplier’s capacity.

6.3 End-of-Life Capacity. Supplier will give Seagate at least 12 months’ before it stops accepting orders for any Product. During the 12-month notice period, Seagate may continue to place orders for the discontinued Product. Seagate may schedule deliveries of the discontinued Product for up to six months after the last date that Supplier will accept orders. In the event that eASIC intends to discontinue the manufacture and/or sale of any Product, eASIC will give at least twelve (12) months prior written notice to Seagate. During such period (“Discontinuance Period”) Seagate may place end-of-life orders for such Product, provided, that the last delivery date shall not be later than six (6) months after the end of the Discontinuance Period.

7. PRODUCT WARRANTY

7.1 Warranty Period. The warranty period for the Products will be 5 years from the date of delivery to Seagate unless a different warranty period is specified in Exhibit A.

7.2 Warranties Terms. During the warranty period Supplier warrants the following:

(a) The Products will fully comply with the Specifications;

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

(b) The Products will fully comply with Seagate’s Product Stewardship Requirements;

(c) The Products will be free from defects in material, workmanship and design;

7.3 Warranty Remedies. If the Products do not meet the warranties, Seagate may elect one or more of the following remedies:

(a) Seagate may require Supplier to repair or replace the Products;

(b) Seagate may return the Products to Supplier at Supplier’s expense for a full refund;

7.4 Remedies Exclusive. The remedies listed above are exclusive and in lieu of all other remedies available to Seagate in law or equity. Subject to Section 6.3 of this Agreement, the obligation to provide repaired or replacement Products during the warranty period continues whether or not Supplier has discontinued manufacturing the Products.

8. RELIANCE ON SUPPLIER

8.1 Advice Regarding Intended Use. Supplier will assign personnel to work directly with Seagate who are reasonably qualified to advise Seagate in the selection and use of Supplier’s Products. In the event that during the development of a Product, the assigned Supplier personnel for such Product has knowingly formed the conclusion that there will be material issue in Seagate’s use of such Product, then the Supplier Product Manager will promptly inform the Seagate Product Manager of the same in writing.

8.2 Return of Product. If a Product does not function properly in the manner in which it is used by Seagate, and if Seagate provided sufficient information to Supplier regarding Seagate’s intended use for the Product such that Supplier should have known that the Product would not function properly, then Seagate may return the Product to Supplier as non-conforming, even if the Product meets the Specifications.

8.3 Limits on Reliance. Supplier will have no obligation to accept return of non-conforming Products under this Section 8, if Seagate does not disclose sufficient information about its intended use of Products, or if Supplier warns Seagate in writing of a potential problem with Seagate’s intended use of Products and Seagate disregards Supplier’s warnings.

9. ONGOING QUALITY AND RELIABILITY

9.1 Manufacturing Process Inspections. Supplier will cooperate with Seagate and use its commercially reasonable best efforts to facilitate Seagate’s inspection (at Seagate’s expense) of Supplier’s third party manufacturing locations, warehouses, and other facilities during normal business hours with reasonable notice to Supplier. Supplier will provide Seagate with its own inspection, quality and reliability data upon request.

10. INDEMNIFICATION AND DEFENSE

10.1 General Indemnification. Each party will defend and indemnify the other and that party’s affiliates, directors, employees and contractors (collectively “Indemnitees”) against any claim or action brought by a third party against an Indemnitee arising from (a) an allegation of the indemnitor’s negligence or willful misconduct; or (b) Supplier’s failure to comply with Seagate’s Product Stewardship Requirements.

10.2 Infringement Indemnification. Supplier will defend and indemnify each Indemnitee against any claim or action brought by a third party against an Indemnitee, alleging that a Product infringes a patent, copyright, trademark, trade secret, trade name, trade dress, mask work or other intellectual property right.

10.3 Seagate’s Obligations. Seagate must promptly notify Supplier of the claim or action and give reasonable assistance and cooperation to Supplier in the defense of the claim or action.

10.4 Payment of Damages and Defense Costs. Supplier will pay all damages awarded or agreed to in settlement against an Indemnitee. Supplier will pay all reasonable costs incurred by an Indemnitee in defending the claim or action. Supplier will not be obligated to pay damages to an Indemnitee to the extent

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

that the damages were caused by (a) an Indemnitee’s own willful misconduct; (b) an Indemnitee’s use of Supplier’s Products in combination with other products if the sole cause of the infringement is the other products; or (c) an Indemnitee’s modification to the Products made without Supplier’s knowledge.

11. LIMITATION OF LIABILITY

11.1 Limitation of Amount of Liability. Except for liability arising under Exhibit F, neither party will be liable to the other, regardless of the basis of liability or the form of action, as follows: Seagate’s liability is limited to the total price paid by Seagate to Supplier, net of all discounts and refunds, over the 12-month period before the liability arose. Supplier’s liability shall not exceed for each occurrence, 3 times the amount paid or payable by Seagate to Supplier under the Agreement in respect of the defective part number in the 12 months preceding the claim giving rise to the liability or in the aggregate the amount paid or payable by Seagate to Supplier over the life of this Agreement.

11.2 Limitation of Type of Liability. Except for liability arising under Section 10 and Exhibit F, neither party will be liable for any consequential, incidental, indirect, special, economic, or punitive damages even if the other party has been advised of the possibility of such damages.

12. TERM AND TERMINATION

12.1 Effective Date and Expiration Date. This Agreement is effective from the Effective Date through the Expiration date shown on the first page.

12.2 Renewal. After the Expiration Date, this Agreement will automatically renew for successive 1-year terms unless either party notifies the other party that they will not renew the Agreement at the end of the then-current term.

12.3 Termination for Convenience. Seagate may terminate this Agreement for any reason by providing 60 days prior written notice to Supplier.

12.4 Termination for Cause. Either party may terminate this Agreement immediately if (a) the other party breaches a material obligation of this Agreement that by its nature is incurable; (b) if the party breaches a material obligation that may be cured and the breach is not cured within 30 days after notice by the non-breaching party; (c) a receiver is appointed for the other party or its property; (d) the other party makes an assignment for benefit of its creditors; (e) proceedings are commenced by or for the other party under any bankruptcy, insolvency, or debtor’s relief law, or (f) the other party liquidates or dissolves its business or attempts to do so.

12.5 Effect of Termination or Expiration. Upon termination or expiration of this Agreement, its provisions will continue to apply to all undelivered orders that were accepted by Supplier while the Agreement was in force. Upon termination of this Agreement, Seagate will compensate Supplier as provided in Exhibit E.

13. DISPUTE RESOLUTION

13.1 Good-Faith Negotiation. The parties will attempt to resolve any dispute relating to this Agreement through good-faith informal negotiation.

13.2 Mediation. If the parties are unable to resolve the dispute through good faith informal negotiation, they will participate in mediation before an agreed mediator from Judicial Arbitration and Mediation Services (“JAMS”). Either party may initiate mediation by providing a written request for mediation to the other party and to JAMS. The request must describe the dispute and the relief requested. The mediation will be scheduled within ten business days after the request. The mediation will take place at

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

a JAMS facility in California. The parties will cooperate with JAMS and with one another in selecting a mediator from a JAMS panel of neutrals, and in scheduling the mediation proceedings. The parties will participate in the mediation in good faith. The parties will bear their own expenses in mediation, but will share all fees to JAMS equally.

13.3 Equitable Relief Excluded. Either party may seek equitable relief to enforce the rights granted in Section 10 or to obtain a temporary restraining order or other provisional remedy to preserve the status quo or prevent irreparable harm.

13.4 Survival and Attorney’s Fees. This Section 13 will survive the Agreement’s termination or expiration. This Section 13 may be enforced by any court of competent jurisdiction, and a party seeking enforcement will be entitled to an award of all costs, fees and expenses, including attorney’s fees, to be paid by the party against whom enforcement is ordered.

14. INSURANCE

14.1 Minimum Insurance Requirements. Supplier will maintain Commercial General Liability insurance of not less than $2,000,000 Combined Single Limit for Bodily Injury and Property Damage. Supplier’s general liability insurance must include coverage for broad form property damage, blanket contractual liability, advertising and personal injury liability, and products/completed operations. Supplier will also maintain Automobile Liability insurance with a combined single limit for Bodily Injury and Property Damage of not less than $1,000,000 per occurrence. Supplier may maintain a lesser limit of General Liability or Automobile Liability insurance if the policy, combined with Supplier’s Umbrella or Excess Liability policy, meets the respective minimum coverage limits for General Liability and Automobile Liability insurance required under this Agreement.

14.2 Workers’ Compensation and Employer’s Liability Insurance. If Supplier has employees or acquires employees during the term of this Agreement, then Supplier must maintain Workers’ Compensation insurance as required by statute; and Employer’s Liability insurance in not less than the amounts that follow (or as otherwise required by applicable state law). The policy must permit (or be endorsed to permit) Supplier’s waiver of insurer’s subrogation rights against Seagate and Supplier agrees to waive its subrogation rights.

(a) Bodily injury by accident	$500,000 per accident
(b) Policy limit by disease	$500,000 policy limit
(c) Bodily injury by disease	$500,000 per employee

14.3 Professional Liability Insurance. Supplier will maintain Professional Liability insurance, including acts, errors and omissions arising out of the rendering of, or failure to render, professional services related to this Agreement with coverage limits of no less than $3,000,000 per occurrence.

14.4 Proof of Insurance and General Requirements. Supplier’s required insurance must (a) respond as primary coverage concerning Supplier’s indemnity and insurance obligations under this Agreement and neither Seagate nor its insurers will be required to pay for any portion of such obligations; and (b) contain a standard cross liability endorsement or severability of interest clause. Supplier must provide Seagate with proof of insurance satisfactory to Seagate. Supplier will immediately notify Seagate of any material change in its insurance. Supplier’s certificate of insurance must provide that no cancellation of the insurance will be effective without ten days’ advance written notice to Seagate. In no event will any required insurance coverage or limits reduce Supplier’s obligations to Seagate under this Agreement.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

15. MISCELLANEOUS

15.1 Master Nondisclosure Agreement. The parties have entered into a Master Nondisclosure Agreement number 75226, and supplements thereto, which will govern disclosures of information between the parties.

15.2 Relationship of the Parties. Supplier and Seagate are independent contractors.

15.3 No Intellectual Property Rights Granted. Except as expressly provided, this Agreement does not grant either party any right to the other party’s patents, copyrights, trademarks, trade secrets, or other forms of intellectual property.

15.4 Assignment. Due to the nature of each party’s duties and Seagate’s reliance on Supplier’s performance in supplying Products, Seagate may assign this Agreement to any third party upon written notice to Supplier, without requiring Supplier’s consent. Supplier may assign this Agreement only with the prior written consent of Seagate. Provided, however, that the transfer of a controlling ownership interest in Supplier by way of merger, sale of capital stock or sale of all or substantially all of the assets of the business unit responsible for the production and sale of the Products shall be permitted without the prior consent of Seagate. Supplier will give notice to Seagate of an impending transfer of controlling ownership as soon as practicable and permissible under applicable law. This Agreement will be binding upon and will inure to the benefit of the parties and their permitted successors and assigns.

15.5 Compliance with all Laws. Supplier, and all Products supplied by Supplier and work performed by Supplier, must comply with all applicable laws and regulations in effect, including those governing environment, health and safety, and labor and employment practices. Supplier must require that its sub-suppliers also comply with all applicable laws and regulations in effect. Upon request, Supplier will certify that it complies with all applicable laws and regulations. Seagate may audit Supplier to confirm Supplier’s compliance with this Section.

15.6 Export Controls. Each party will comply with all applicable export, re-export and foreign policy controls and restrictions imposed by the U.S. and the country in which they are located, including the U.S. Export Administration Regulations. Supplier may not export, re-export or allow to be disclosed, any technical data received from Seagate or the product of any technical data to any person or destination to the extent prohibited by law.

15.7 English Language; Governing Law. English is the authoritative text of this Agreement, and all communications and proceedings must be conducted in English. If this Agreement is translated, then the English language version will control. The laws of the State of California, USA govern this Agreement, without regard to any conflicts of laws rules. The United Nations Convention on Contracts for International Sale of Goods does not apply to this Agreement.

15.8 Force Majeure. Neither party will be liable to the other if its performance is delayed by circumstances beyond its reasonable control. If a force majeure condition prevents Supplier’s performance for more than 60 days, then Seagate may terminate this Agreement or cancel any unfilled orders without liability owed to Supplier.

15.9 Severability; Survival. The terms of this Agreement are severable. If any term is unenforceable for any reason, then that term will be enforced to the fullest extent possible, and the Agreement will remaining in effect. All obligations that by their terms or nature survive termination of this Agreement will continue until fully performed.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

15.10 Written Amendments; Electronic Business Transactions. This Agreement may be changed only by written amendment signed by both parties. The parties may exchange electronic documents in lieu of printed purchase orders, order acknowledgments, or forecasts. Supplier will comply with Seagate’s designated system of exchanging electronic documents and will bear its own costs to participate in the system. Neither party will contest the validity or enforceability of electronically transmitted purchase orders or order acknowledgments on the grounds that they fail to comply with the Statute of Frauds or similar laws requiring that contracts be in writing (such as UCC Section 2-201 or any state-law equivalent). Neither party is prohibited from asserting that an electronic document is invalid for any reason that would also invalidate a written document.

15.11 Entire Agreement; No Waiver; Notices. This Agreement and the documents referred to in it are the entire agreement of the parties with respect to this subject matter, superseding all prior or contemporaneous agreements. No failure or delay in exercising any right will be considered a waiver of that right. All notices and other communications must be delivered to the addresses designated on the first page of this Agreement.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

EXHIBIT A

PRODUCT AND PRICE LIST

Pricing Effective:	From date to date
Product Description	Supplier Part No.	Seagate Part No.	Unit	Price
Overton	50344	100584428	1

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

EXHIBIT B

CUSTOMS CLEARANCE DOCUMENTATION

15.12 For Product that must be cleared through customs, Supplier must provide customs documentation (sometimes referred to as a “proforma invoice” or “customs invoice”) for the purpose of facilitating customs clearance. The customs documentation must be in English and must include the following information:

1. SHIPPING INFORMATION

15.13 Date of shipment;

15.14 Invoice number and shipment number;

15.15 Seagate purchase order number;

15.16 Shipper name and address;

15.17 Ship to party (name and address including attention party if available) and bill to party (name and address);

15.18 Customs Broker (name);

15.19 Shipments from all countries, except China or Hong Kong, using wood pallets must state the solid wood packing materials are totally free from bark, and apparently free from live plant pests”;

15.20 Shipments from China or Hong Kong, not using solid wood packing materials (“SWPM”) must state “this shipment contains no SWPM.” If SWPM is used, a separate Chinese or Hong Kong government issued certificate of fumigation is required”;

15.21 Name, contact information and signature of responsible individual - must be a responsible employee of the exporter who has knowledge or who can readily obtain knowledge of the transaction;

15.22 Incoterm and named place; and

15.23 Shipment gross weight.

2. PRODUCT INFORMATION

15.24 Description of Product, grade or quality, as well as marks, numbers, and symbols under which the Product is sold, if applicable - for product description, use generic terms by which each item is commonly known.

15.25 Product quantities, including quantity of Product per each individual package/box, the number of packages/boxes, the number per pallet, the number of pallets, and the corresponding weights – the information must be sufficiently detailed to enable identification and matching of Product in the shipment against line items on the shipping invoice;

15.26 Seagate part numbers

15.27 Country of origin (place of manufacture) by part and quantity

15.28 FCC ID number, if any

15.29 FDA accession number, if any; if the invoice contains multiple pages, each page must be number, preferably in the following format: X of Y pages

15.30 Product net weight

15.31 Product classification information including:

15.32 Harmonized Tariff Schedule number

15.33 Export Control Classification Number (ECCN)

3. PRICING INFORMATION

15.34 Unit purchase price and type of currency (if the merchandise is not purchased, the value or usual price in the country or exportation)

15.35 All charges upon the Product, itemized by name and amount, including freight, insurance, commission, cases, containers, coverings and cost of packing

15.36 Total purchase price and terms of payment — customs regulations require every shipping invoice accurately reflect the price to be paid by Seagate. The shipping invoices are used to declare the value of the imported Product for customs entry. Accordingly, 100% accuracy is required. Post-shipment price increases can render declarations inaccurate; therefore, price increases may not be applied to Product already shipped or in JIT or VMI inventories.

15.37 Any goods or services furnished to Supplier for the production of the Product not included in the invoice price (e.g. assists such as dies, molds, tools, engineering work) - however, goods or services furnished in the destination country are excluded.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

EXHIBIT C

PRODUCT DESCRIPTION AND SPECIFICATIONS INCORPORATED BY REFERENCE

Document Title or Description	Document Number	Rev	Dated
General Semiconductor Specifications	[*]	[*]	[*]

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

EXHIBIT D

PRODUCT STEWARDSHIP REQUIREMENTS

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Exhibit E

Buffer Management & Liability

Upside Capacity. Seagate may increase Seagate’s requested quantities in the DELFOR at any time. Supplier must be able to meet requested Seagate increases in the scheduled quantities in the DELFOR for each Product cumulatively within each Lead Time period for each Product as follows:

	Upside Capacity
Upside Capacity Amount Equals this Percentage of the sum of the scheduled quantities within Lead Time in the Committed DELFOR		Time Period During Which eASIC must make such Upside Capacity Amount Available for Delivery
20%		Between 0-2 weeks after increase request
20%		Between 2 weeks after increase request to end of Lead Time period

Supplier will make reasonable efforts to accommodate any requests for quantities above the Upside Capacity specified in this Exhibit.

Downside Flexibility. If Seagate reschedules the delivery of any Products outside of Lead Time Seagate must purchase the rescheduled quantity within [*] days and such quantity remains binding to Seagate. Without incurring any liability, Seagate may cancel orders for a Product to the extent that such order is not binding to Seagate as provided in this Agreement. Lead Time is subject to review by parties at quarterly capacity planning meetings, provided that any changes to Lead Time will require mutual written agreement of the parties. Subject to the terms and conditions of this Agreement, Seagate may cancel an order for a product that is binding to Seagate as provided in this Agreement, subject to payment of the following cancellation charges:

Stage of Completion at Time of Cancellation Notice	Cancellation Charges (Percentage of Exhibit A’s Price Per Unit)
Finished Goods	[*]
Final Test	[*]
Assembly	[*]
Die Bank	[*]
Fab	[*]

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

EXHIBIT F

QUALITY STANDARDS

Commitment to Seagate’s Quality Requirements

1. Product Stewardship Requirements. Seagate’s current Product Stewardship Requirements are referenced in Exhibit D. Seagate will update the Product Stewardship Requirements from time to time and these will be updated by agreement of Supplier. Supplier must promptly notify Seagate if any of its Products include chemicals or compounds in amounts that exceed the threshold amounts listed in the Product Stewardship Requirements and work with Seagate to become into compliance. Each shipment of Products to Seagate will constitute a certification by Supplier that the Products shipped meet the agreed upon Product Stewardship Requirements. Upon Seagate’s request, Supplier will provide sufficient documentation to Seagate to show that the Products conform to the Product Stewardship Requirements. Supplier will maintain processes and policies designed to protect the environment and employee health and safety at any facility where services related to this Agreement are performed.

2. ISO 9001 Certification. Supplier must have a total quality system in place that meets ISO 9001 certification requirements.

3. Corrective Action. Whenever a Product does not perform as warranted, Seagate may request that Supplier implement a containment plan within 72 hours after the failure. Supplier must provide Seagate with a detailed failure analysis identifying root cause as soon as practicable after the failure. Supplier will work with Seagate to determine the effect of the failures on Seagate’s products and customers; and Supplier will implement a corrective action plan that is acceptable to Seagate to eliminate the effect of the failures on Seagate’s products and customers. Supplier will maintain the effectiveness of all corrective actions implemented as well as apply these corrective actions to other Products when and where applicable.

4. Epidemic Failure; Product Recall. In addition to the warranty obligations above in Section 7, Supplier will be obligated to remedy any Epidemic Failure of Products. An Epidemic Failure will be defined as the occurrence of multiple failures of the same Products failing to perform as warranted due to the same root cause, to the extent that the failure rate of the Products exceeds [*] of the Products shipped within a four week period. In the event of an Epidemic Failure, as confirmed by failure analysis by Supplier, Supplier will pay for Seagate’s reasonable, direct, out-of-pocket costs associated with replacing Product which is the subject of the Epidemic Failure. In addition, Supplier will: (a) immediately cease selling all Products that may evidence the Epidemic Failure, (b) develop and incorporate a remedy for the Epidemic Failure in the affected Products, and (c) replace all failing Products per the terms of the warranty in Section 7.

5. Supplier’s total financial liability for Epidemic Failure (aggregating claims from all Seagate locations and third party contractors) shall not exceed the sum of the amount equal to 3 times the amount paid by Seagate to Supplier under this Agreement in respect of the defective part number in the 12 months preceding the claim giving rise to the liability, up to a maximum aggregate total of the amount paid or payable by Seagate to Supplier over the life of this Agreement.

6. Failure Rate. With respect to each Product, Supplier will comply with the failure rate limit(s) set forth below. Supplier will report to Seagate the failure rates for each Product on a monthly basis. If the actual failure rate for any Product exceeds the goal, then Supplier will designate a team that will determine the root cause of the failure and will report to Seagate at weekly meetings until the actual failure rate for the Product is below the goal.

6.1 Annualized Return Rate (“ARR”). The permitted ARR for each Product will be less than [*]%.

6.2 Intrinsic Failure Rate. The intrinsic failure rate (IFR), which is a measure of long-term reliability, [*], where “FIT” is defined as the number of failures per billion hours of operation under normal conditions.

6.3 Early Failure Rate Defective Parts Per Million (“DPPM”). The early failure rate DPPM, which represents the line fallout in Seagate’s printed circuit board assembly, substrate, media and drive build factories, will be less than [*]. Supplier will demonstrate the early failure rate DPPM by performing appropriate accelerated life testing on a statistically significant number of parts, which are representative of the fabrication and package assembly processes. If the Supplier’s process is not in control, then a 100% test screen under appropriate environmental stress conditions may be required to achieve the desired reliability level.

6.4 Defective Parts Per Million (“DPPM”). During the volume production phase, the DPPM will be [*] or less.

7. Even if a Product passes Seagate’s initial drive qualification testing and meets the Specifications during the Product qualification procedure, the Product will be deemed to have failed Seagate’s Quality Standards if any Seagate disc drive incorporating the Products fails to achieve its specifications and the failure is proven to be attributable to the incorporated Products. When material does not meet Seagate’s Quality Standards, Supplier is expected to make commercially reasonable efforts to assist Seagate in satisfying Seagate’s overall quality objectives and in re-qualifying the Product for use by Seagate. Commercially reasonable efforts may include, but are not limited to, repair, replacement with new Product, or return of Product with full credit in accordance with terms of this Supply Agreement.

To meet Seagate’s Quality Standards, Supplier agrees:

(a) To produce Product in accordance with all applicable and mutually agreed upon Seagate Specifications and all documents referenced in Specifications, including but not limited to Exhibit C, Receiving Inspection and Testing Procedure, Discrepant Material Procedure, and General Inspection Plan (GIP) Procedures;

(b) To provide, at Seagate’s request, actual performance metrics;

(c) To comply with DPPM levels as mutually agreed in writing by Supplier and Seagate;

(d) To implement a Six Sigma program upon the request and assistance of Seagate in accordance with Seagate’s implementation goals;

(e) To conduct ongoing reliability testing of product families as defined by Seagate’s General Semiconductor Specification, 64902200, rev N.; and

(f) To meet Seagate’s Quarterly Business Review Scorecard Acceptance Level as defined by Seagate’s Materials department and Supplier Quality Engineering department.

Seagate may change its Quality Standards with [*] days’ prior written notice to Supplier. Supplier will use commercially reasonable efforts to comply with the Quality Standards change requests and provide Seagate with a plan to implement the Quality Standards changes, or an alternate proposal subject to Seagate’s written approval, within 30 days.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

AMENDMENT NO. 1

TO PRODUCT SUPPLY AGREEMENT

This Amendment No. 1 (this “Amendment”) to Product Supply Agreement is entered into by Seagate Technology LLC (“Seagate”) and eASIC Corporation (“Contractor”). Seagate and Contractor previously entered into the Product Supply Agreement identified as Seagate Agreement No. 80364 (the “Agreement”).

Seagate: Seagate Technology LLC Attention: Corporate Contracts Mail Stop: CPCA 03C16 10200 South De Anza Boulevard Cupertino, CA 95014		Contractor: eASIC Corporation 2585 Augustine Drive Suite 100 Sanata Clara, CA 95054
Authorized Signature	/s/ Bruce A. Sanders	Authorized Signature	/s/ Ronnie Vasishta
Print Name:	Bruce A. Sanders	Print Name:	Ronnie Vasishta
Title:	VP Global Material	Title:	President & CEO
Date	06/02/2014	Date	05/30/2014
Underlying Ref. No.:	80364
Amendment Ref. No.	151062
Amendment Effective Date:	May 23, 2014

The parties agree to amend the Agreement as follows:

1. AMENDMENTS

1.1     12.1 Effective Date and Expiration Date. This section is deleted in its entirety and replaced with the following:

This Agreement is effective on the Effective Date specified on the signature page, and continues until terminated.

1.2     12.2 Renewal. This section is deleted in its entirety.

2. MISCELLANEOUS

2.1 Dispute Resolution. Seagate and Contractor shall resolve any dispute relating to this Amendment in the same manner as set forth in the dispute resolutions provisions in the Agreement. The laws of the State of California, without regard to its conflicts of laws rules, govern this Amendment and any disputes relating to this Amendment.

Page 1 of 2 Amendment Ref. No. 151062 Underlying Agreement Ref. No. 80364

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

2.2 Entire Agreement; Incorporation. This Amendment is the entire agreement between Seagate and Contractor regarding this subject matter. The terms of this Amendment are incorporated into the Agreement.

2.3 Authorization; Notices. Each person signing this Amendment represents that he or she is authorized to sign on behalf of his or her company. All notices given related to this Amendment must be sent to addresses specified above, or any other addresses the parties designate in writing.

Page 2 of 2 Amendment Ref. No. 151062 Underlying Agreement Ref. No. 80364

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

2585 Augustine Drive, Suite 100 Santa Clara, CA 95054 Phone: (408) 855-9200 Fax: (408) 855-9201 www.easic.com

Ms. Tara. L. Long

Vice President of Strategy and Corporate Development

Seagate Technology LLC

10200 De Anza Blvd

Cupertino, CA 95014

Re: Letter from Counsel Asserting Rights to Indemnification

Dear Tara,

As you know, eASIC (the “Company”) received a letter from McDermott Will and Emery LLP, counsel to Seagate Technology LLC (“Seagate”), on November 10, 2014, which, among other things, asserted Seagate’s rights to indemnification and defense costs in connection with a patent suit against Seagate, which letter is attached hereto (the “Rights Assertion Letter”). Specifically, the Rights Assertion Letter asserted Seagate’s rights to indemnification and defense costs in connection with a suit, Case No. 3:13-cv-2946-H-BGS (S.D. Cal), against Seagate by plaintiff e.Digital Corporation alleging that certain Seagate SSD and SSHD products infringe claim 1 of U.S Patent No. 5,839,108 (the “Lawsuit”). Seagate contends that the Company provided the flash controller for the Seagate products alleged to have infringed the e.Digital Corporation patent, and Seagate asserts its rights to indemnification and defense costs pursuant to paragraph 10.2 of the Product Supply Agreement (No. 80364) dated June 28, 2010 and Amendment No. 1 to the Product Supply Agreement (No. 151062) dated May 23, 2010 (collectively, the “PSA”).

You and I have spoken, and understand that Seagate has determined, that it will agree to limit the amount of indemnifications and defense costs to be capped at a maximum, not to exceed $200,000. The actual amount maybe less based on actual costs incurred by Seagate. I understand that, as to the Lawsuit, Seagate is willing to waive its rights to seek indemnification and defense costs in excess of $200,000 from the Company pursuant to the PSA (the “Waiver”). I understand that this is a specific limitation, applicable only with respect to the Lawsuit, and that Seagate does not waive or limit its rights to not seek indemnification and defense costs from the Company with respect to any other patent infringement lawsuits brought against Seagate for products which incorporate the Company’s products.

I also confirm that the Company does not object to Seagate’s producing, in response to plaintiff’s discovery request, the PSA and technical documents sufficient to show the design and operation of the flash controller, as long as produced under a protective order in accordance with the description of such production as detailed in the Rights Assertion Letter.

If this letter accurately reflects our understanding and agreement on the matters set forth herein, I would ask you or another authorized person at Seagate to sign below evidencing our understanding and agreement on the matters set forth herein.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

We appreciate our business partnership with Seagate and appreciate the effort you and your company have made in assisting us on this issue. Thank you for your assistance in this matter.

Sincerely

/s/ Ronnie Vasishta            

Ronnie Vasishta,

Chief Executive Officer

ACCEPTED AND AGREED:

This letter accurately reflects our understanding and agreement on the matters set forth herein, including the Waiver.

Seagate Technology LLC

/s/ Tara Long

(Authorized Person & Title)

Tara Long

VP Strategy & Corporate Development

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

November 10, 2014

VIA FEDEX

Ronnie Vasishta

eASIC Corporation

2585 Augustine Drive

Suite 100

Santa Clara, CA 95054

Re: e.Digital Corporation v. Seagate Technology LLC

Case No. 3:13-cv-2946-H-BGS (S.D. Cal.)

Notice of Right to Indemnification / Notice of Production of Documents

Dear Mr. Vasishta:

I represent Seagate Technology LLC in the above-referenced lawsuit. Plaintiff e.Digital Corporation has sued Seagate for infringement of U.S. Patent No. 5,839,108, asserting that certain Seagate SSD and SSHD products infringe claim 1 of this patent. I am writing you for two reasons.

First, I am writing to provide notice of Seagate’s right to indemnification and defense costs from eASIC Corporation relating to this lawsuit. eASIC provided the accused flash controller for certain accused Seagate products pursuant to the Product Supply Agreement (No. 80364), dated June 28, 2010 (the “PSA”), and Amendment No. 1 to Product Supply Agreement (No. 151062), dated May 23, 2014 (“Amendment No. 1”). For your convenience, I have enclosed copies of the e.Digital Complaint, the PSA, and Amendment No. 1.

Seagate is entitled to indemnity and defense costs from eASIC pursuant to Paragraph 10 (Indemnification and Defense) of the PSA. Specifically, Paragraph 10.2 provides that “Supplier [i.e., eASIC] will defend and indemnify each [Seagate] Indemnitee against any claim or action brought by a third party against an Indemnitee, alleging that a Product infringes a patent, copyright, trademark, trade secret, trade name, trade dress, mask work or other intellectual property right.”

Accordingly, this letter shall serve as notice of Seagate’s right to indemnification and defense costs from eASIC under the parties’ PSA. Please forthwith confirm in writing that eASIC will honor its indemnification obligation.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

Ronnie Vasishta

November 10, 2014

Page 2.

Second, the plaintiff has propounded discovery requests that seek documents and information concerning certain the accused SSHD products. I have enclosed a copy of these requests. Seagate is hereby providing prior notice that it intends to produce at least the PSA and Amendment No. 1 in response to e.Digital’s document requests, as well as technical documents sufficient to show the design and operation of the accused flash controllers. I have also enclosed a copy of the protective order governing discovery in this lawsuit. Seagate will designate these documents as “CONFIDENTIAL — FOR COUNSEL ONLY” under the protective order. Please confirm at your earliest convenience that eASIC has no objection to this production.

We appreciate your cooperation and look forward to hearing from you.

Sincerely,

/s/ Eric W. Hagen

Eric W. Hagen

Enclosures

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

EX-10.17

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

Exhibit 10.17

GENERAL PURCHASE AGREEMENT (GPA)

between

eASIC Corporation, a United States corporation that is incorporated in Delaware, having a tax ID# 77-0532688, and having its principal place of business at 2585 Augustine Drive, Suite 100, Santa Clara, CA 95054, United States.

and

ERICSSON AB, a limited liability company duly incorporated and existing under the laws of Sweden, with organization number 556056-6258 and having address Torshamnsgatan 23, SE-164 80 Stockholm, Sweden.

TABLE OF CONTENTS

PREAMBLE

1.	DEFINITIONS	1
2.	SCOPE OF AGREEMENT	3
3.	ORDERING PROCEDURE	4
4.	PRICES AND TERMS OF PAYMENT	5
5.	TERMS OF DELIVERY	5
6.	PACKING AND LABELLING	6
7.	QUALITY AND CODE OF CONDUCT	6
8.	RECEIPT OF GOODS	7
9.	WARRANTY	7
10.	DELAY	9
11.	PRODUCT LIABILITY	10
12.	CONTINUITY OF SUPPLY	10
13.	INTELLECTUAL PROPERTY RIGHTS	11
14.	INFRINGEMENT	12
15.	BUYER DOCUMENTATION TOOLS AND BUYER DESIGN	12
16.	EXPORT AND IMPORT	13
17.	CONFIDENTIALITY	13
18.	FORCE MAJEURE	14
19.	TERM AND TERMINATION	14
20.	CONTACT PERSONS	15
21.	LIMITATION OF LIABILITY	15
22.	MISCELLANEOUS	15
23.	DISPUTES AND GOVERNING LAW	16

EXHIBIT 1	CODE OF CONDUCT
EXHIBIT 2	BANNED AND RESTRICTED SUBSTANCES
EXHIBIT 3	PRODUCT PURCHASING RIGHTS EXHIBIT

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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PREAMBLE

Whereas, Ericsson Companies develop, produce, sell and provide telecommunication systems, products and services globally.

Whereas, Seller sells, distributes and markets the Goods.

Whereas, the parties hereby enter into this Agreement in order to assure the supply of Goods for purchase by Ericsson Companies and Authorized Companies in sufficient quantities and of sufficient quality and to detail the obligations of the parties and other terms and conditions for the supply and delivery of the Goods.

Whereas, the parties acknowledge that this Agreement needs to be supplemented by one or more SPAs.

NOW, THEREFORE, the parties agree as follows.

1 DEFINITIONS

1.1 For the purpose of this Agreement, the following terms shall have the meanings hereby assigned to them unless the context would obviously require otherwise.

“Agreement”	means this general purchase agreement, including its exhibits and any other attachments hereto, together with any amendments, modifications and supplements executed by the parties.
“Aggregated Purchase Value”	means the higher of: i) the total value of the aggregate purchase prices paid for all Goods delivered under this Agreement and any SPA referring to this Agreement, during a period of [*] prior to the relevant claim or delay; or ii) the total value of the aggregate purchase prices to be paid for Goods estimated to be delivered under this Agreement and any SPA referring to this Agreement during the forthcoming period of [*] immediately following the relevant claim or delay.
“Authorized Company”	means a company (e.g., a so called electronic manufacturer supplier or logistic provider) which has been listed in an SPA as a company, which is entitled to place purchase orders under the said SPA for the Goods.
“Business Days”	means the normal business days (excluding Saturdays and Sundays) of the Seller Company having received a purchase order for the Goods.
“Buyer”	means the Ericsson Company or Authorized Company which has issued a purchase order for the Goods under this Agreement and the relevant SPA, and which accordingly is the contracting party for the specific Contract.
“Buyer Design”	means any database tape, test tape, design, simulation information, functional specifications, schematics, files of electronic designs, test patterns and other relevant information or documentation prepared by Buyer and licensed to Seller under the Agreement for the purpose of Seller’s manufacturing of the Goods for Buyer

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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“Buyer Documentation”	means any drawings, technical documents, software programs or other documents in whatever medium or format submitted to Seller by Buyer or any Ericsson Company, and any documents related to any Buyer Tools.
“Buyer Tools”	means any tool, model, fixture, measuring instrument, equipment or equivalents, made available by Buyer or any Ericsson Company, or acquired or produced by Seller at Buyer’s expense.
“Code of Conduct”	means the at all times latest version of Ericsson’s code of conduct as further described in Article 7 (Quality and Code of Conduct).
“Contract”	means a specific sourcing contract regarding Buyer’s procurement of the Goods, concluded by the relevant Buyer and the relevant Seller Company in accordance with Article 3 (Ordering Procedure).
“Customer Damages”	means damages, costs or expenses paid by any Ericsson Company, to any customer to which the Goods have been sold to or leased to by an Ericsson Company, due to the Ericsson Company’s contractual liability and/or mandatory law, and caused by defective Goods.
“Ericsson”	means the Ericsson Company having signed this Agreement.
“Ericsson Company”	means Telefonaktiebolaget LM Ericsson (publ) or any other company whose votes and/or capital are to fifty per cent (50%) or more controlled directly or indirectly by Telefonaktiebolaget LM Ericsson (publ).
“Goods”	means any components, equipment, parts, merchandise or other assets purchased under this Agreement and the applicable SPA.
“Intellectual Property Rights”	means any and all intellectual property rights including, but not limited to, patents, copyrights, trademarks, trade name rights, trade secret rights, know-how, source and object codes, algorithms, mask works, designs, utility models, and all improvements and amendments thereof, as well as all registrations, applications, renewals, extensions, continuations, divisions or reissues thereof now or hereafter in force.
“Lead Time”	means an agreed period of time with or without forecast, immediately preceding the delivery date.
“Seller”	means (i) the Seller Company having signed this Agreement, or (ii) as regard to the particular rights and obligations relating to a Contract, the Seller Company which has received a purchase order under this Agreement and the relevant SPA, and which accordingly is the contracting party for the specific Contract.
“Seller Company”	means Seller’s ultimate parent company or any company whose votes are to more than fifty per cent (50%) controlled directly or indirectly by such company.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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“Site”	means the delivery address of Buyer, distributors and customers (purchasers and users) and actual location(s), (i) where the Goods are actually incorporated into a customer’s system(s), or (ii) where the Goods are stored prior to be incorporated into a customer’s system(s).
“SPA”	means a specific purchase agreement concluded in accordance with Article 2 (Scope of Agreement) below and referring to this Agreement.
“Specification”	means the from time to time mutually agreed specification, which shall include Seller’s sign-off sheet and product family data sheet applicable to the Goods, and such other documents as may be agreed by the Parties. Any changes to the Specification shall be mutually agreed between the Parties.

1.2 Other capitalized expressions used in this Agreement or an SPA shall have the meanings respectively assigned to them.

1.3 Words indicating the singular only also include the plural and vice-versa, where the context so requires.

1.4 The headings of the Articles are for convenience only and shall not affect their interpretation.

2 SCOPE OF AGREEMENT

2.1 This Agreement comprises the general terms and conditions under which a Seller may manufacture or otherwise produce and assembly Goods for any Ericsson Company provided such Goods is intended for and will be purchased by a Buyer under a Contract. Any Ericsson Companies and Authorized Companies may purchase such Goods from Seller Companies. The specific terms and conditions regarding the manufacture and purchase of the Goods, if any additional to the provisions set out herein, shall be regulated in one or more SPA.

2.2 Any Ericsson Company may conclude SPAs with any Seller Company on terms and conditions mutually agreed upon.

2.3 Unless otherwise stated in an SPA, all Ericsson Companies are entitled to place purchase orders under the SPA for the Goods. The Seller Companies that are obligated to accept the purchase orders under the SPA shall be listed in the same SPA. The SPA may also state upon mutual agreement which Authorized Companies in addition to the Ericsson Companies that are entitled to issue purchase orders for the Goods under this Agreement and the applicable SPA.

2.4 Buyer shall submit purchase orders in accordance with Article 3 (Order Procedure) and the relevant parties will conclude Contracts in accordance with the said Article.

2.5 Any forecasts provided to any Seller Company shall be for planning purposes only. The quantities listed in the SPA are estimates only and do not constitute a commitment by Ericsson or Buyer, unless otherwise expressly stated in the SPA.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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3 ORDERING PROCEDURE

3.1 With regard to the Goods, Ericsson Companies and Authorized Companies may issue purchase orders in writing, by telefax or, if applicable, by means of EDI.

3.2 Seller shall within [*] from Seller’s receipt of the purchase order acknowledge receipt of the purchase order, and within [*] from the receipt notify the company having submitted the order if, in Seller’s opinion, the purchase order is not consistent with the provisions of this Agreement or the SPA.

3.3 Seller shall at all times use its reasonable efforts to verify whether a purchase order is suitable for its purpose or erroneous. In the event Seller has reason to believe that the purchase order is in any respect erroneous or for other reasons must be adjusted, Seller shall immediately notify the ordering party. Seller shall not start its planning, procurement, staffing and other manufacturing activities earlier than is reasonably required in order to meet the applicable delivery dates.

3.4 A Contract between Seller and Buyer shall be considered concluded when Seller has received a purchase order, provided that the purchase order is in accordance with the terms and conditions of this Agreement and the relevant SPA. The Contract is legally binding upon the parties thereto.

3.5 If the purchase order is not in accordance with the terms and conditions of this Agreement or the SPA, a Contract shall be considered concluded either when: (i) Seller has accepted the said purchase order, or (ii) Seller has received the purchase order and failed to give written notification pursuant to Subarticle 3.2 that the purchase order is not in accordance with this Agreement or the SPA.

3.6 If Seller has notified pursuant to Subarticle 3.2 that the purchase order is not in accordance with this Agreement or the SPA, no Contract is concluded. Instead, the parties shall discuss and agree if a new corrected purchase order shall be issued or if the incorrect purchase order can be accepted, however with certain modifications. In such case, such modifications shall be documented in writing and will form part of the purchase order. When such an agreement has been made, a Contract shall be considered concluded.

3.7 When a Contract has been concluded, this Agreement and the SPA shall then be deemed to be integrated parts of such Contract.

3.8 For the sake of clarification, the parties acknowledge that the parties to the Contract are:

(a) the Ericsson Company or Authorized Company which has submitted the purchase order; and

(b) the Seller Company which has received the purchase order.

3.9 Provided that Ericsson is not the party to the Contract, the parties also acknowledge that:

(a) Buyer is an independent company who acts in its own name and for its own account, and has no authority to bind or impose any legal or other obligation or liability upon Ericsson;

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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(b) Ericsson assumes no legal or other obligation with regard to the Contract;

(c) Seller’s remedies in the event of any breach by Buyer or of any obligation owed to Seller in respect of a Contract, may be exercised solely against the relevant Buyer. Provided, however, that if Seller holds delivery of product or otherwise exercises any permissible remedy against a Buyer by reason of non-payment or late payment of amounts due, such action shall not constitute a breach of this Agreement as against Ericsson or any other Buyer. Seller shall as soon as practicable notify Ericsson of the action it intends to take and the reasons therefor; and

(d) Buyer is not entitled to terminate or amend this Agreement or an SPA (unless Buyer has signed the relevant SPA), however it is entitled to terminate or amend a Contract in accordance with this Agreement.

3.10 A Contract shall consist of the following documents:

(a) the purchase order, excluding any general purchasing conditions, if such have been enclosed with the purchase order;

(b) this Agreement; and

(c) the applicable SPA.

In case of inconsistencies, the different agreement documents will prevail in accordance with the above order, unless an explicit reference has been made in the subordinated document to the effect that a certain provision shall prevail notwithstanding certain provisions in the superior document.

3.11 Seller undertakes to inform any potential Buyer of the existence of this Agreement.

4 PRICES AND TERMS OF PAYMENT

4.1 The prices shall be set out in the SPA. Unless otherwise agreed in the SPA, such prices are firm and fixed and shall include the cost of packing and package.

4.2 Any agreed prices do not preclude mutually agreed special price arrangements requested by Buyer on a case-by-case basis.

4.3 Invoices shall refer to the purchase order number and Buyer’s product numbers for the Goods. Each invoice shall refer to one (1) purchase order only and shall be submitted to Buyer’s location designated in the purchase order.

4.4 Unless otherwise set out in the SPA, undisputed invoices shall be paid by Buyer within [*] from the later of the date of receipt by Buyer of the invoice, or the delivery date of the Goods, provided, however, that it is the understanding of the parties that payment terms in the first executed SPA under this agreement will be [*]. Payment shall be made in the currency set out in the SPA.

4.5 Goods purchased under an SPA shall be regarded as [*].

5 TERMS OF DELIVERY

5.1 Seller understands and acknowledges that proper delivery at the agreed upon delivery dates, is important to Buyer and that delay can cause severe

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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damages to Buyer. Unless otherwise set out in this Agreement or the SPA, the Goods shall be delivered on the date(s) set out in the Contract.

5.2 Buyer may free of charge cancel or change a Contract, in whole or in part [*].

5.3 The terms of delivery shall be [*].

5.4 Subject to [*] under Subarticle 5.3 above Seller shall be responsible for and pay any and all taxes, dues, duties, and levies imposed before the Goods are delivered to Buyer unless otherwise set out in the SPA

5.5 Buyer shall obtain title to the Goods [*].

6 PACKING AND LABELLING

6.1 The Goods shall be packed and marked in accordance with Buyer’s instructions. Under all circumstances, the packing and package shall give the protection required under normal transport conditions to prevent damage to or deterioration of the Goods. The purchase order number and Buyer’s product numbers shall be set out in the shipping documents.

6.2 Seller shall introduce and maintain a system of bar code labeling in accordance with Buyer’s instructions.

7 QUALITY AND CODE OF CONDUCT

7.1 Seller undertakes to use reasonable efforts to comply with the applicable requirements in the ISO 9000 quality system standards.

7.2 Seller undertakes to use reasonable efforts to ensure that its suppliers are in qualified for compliance under ISO 14001 standards. Seller undertakes to comply with the applicable requirements in the Code of Conduct. Exhibit 1 contains the version valid at the date of the signing of this Agreement. The at all times latest version can be found at:

http://www.ericsson.com/ericsson/corporate responsibility/suppliers/index.shtml

7.3 If Seller does not comply with the Code of Conduct or equivalent code of conduct, Seller shall on or before the execution of this Agreement provide Ericsson with a plan for implementation of the said code.

7.4 When delivering the Goods, Seller shall comply at all times with the latest version of Ericsson’s directive regarding banned and restricted substances. Exhibit 2 contains the version valid at the date of the signing of this Agreement. The at all times latest version can be found at:

http://www.ericsson.com/ericsson/corporate responsibility/suppliers/index.shtml

7.5 When and where required by law, Buyer may return the Goods to Seller for disposal.

7.6 The Seller shall regularly conduct trend and failure analyses of his processes, and shall use this information to continuously improve its processes. The Seller shall have a system for identifying and shall promptly inform Buyer about any circumstances that might have an impact on the quality of the Goods. Such a notification shall not limit Seller’s liability for the quality.

7.7 Upon reasonable notice to Seller, Ericsson or Buyer shall be entitled, at no charge by Seller, to inspect Seller’s premises during normal business hours

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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with respect to the verification of processes and quality systems, code of conduct compliance, quality control of the Goods and carrying out sampling and conducting other necessary investigations of quality and delivery performance. Seller shall use its reasonable endeavors to provide for a similar inspection by Ericsson or Buyer on the premises of Seller’s subcontractors or suppliers. In the event that such an inspection does not meet Ericsson’s or Buyer’s reasonable requirements, Seller shall, without delay or cost to Ericsson or Buyer, take the appropriate reasonable remedial measures in order to achieve the reasonable quality level as agreed by the parties.

7.8 Seller shall issue all documents reasonably requested by Ericsson or Buyer, in a format specified by Ericsson or Buyer, regarding the quality of the Goods, including but not limited to materials declaration (i.e. a declaration of the materials and their constituents content) of any Goods.

7.9 The Goods shall meet all requirements imposed by any law or regulations (whether statutory, regulatory or otherwise) being applicable on the production, transport and/or sale of the Goods. The Goods shall also meet the technical standards and the environmental and special market requirements set out in the Specification or otherwise agreed upon. Seller shall upon request furnish a certificate for delivered Goods stating that the Goods conform to all requirements mentioned above.

8 RECEIPT OF GOODS

8.1 In the event delivered Goods (a) do not have the correct part numbers, as identified in the relevant purchase order or otherwise agreed to between the parties; (b) have been damaged prior to arrival at Buyer’s place of business; or (c) otherwise are clearly defective with respect to the requirements set out in the Specification or otherwise separately agreed, Buyer may reject the Goods and return the Goods in accordance with Seller’s established Return Material Authorization (“RMA”) process. In such case the Goods shall be considered not delivered. Buyer may also choose to cancel the Contract concerned or part thereof. Notice of rejection must be provided to Seller within [*] of delivery.

8.2 Seller shall, if requested by Buyer, reimburse [*] made by Buyer for Goods returned to Seller within [*] from the date that Seller received the returned Goods.

8.3 Goods returned under this Article 8 will be delivered to Seller at Seller’s expense and risk. If Buyer has requested replacement Goods, the replacement Goods shall be delivered to Buyer at Seller’s expense and risk.

9 WARRANTY

9.1 Seller warrants that the Goods will perform in accordance with- and conform to the Specification in all material respects, will meet what otherwise has been agreed upon in writing, and will be free from material defects in design, materials and workmanship, provided:

(a) that the Goods have not been subject to misuse or neglect by Buyer or its customer; or

(b) that the Goods have not been altered or repaired otherwise than by Seller or with its approval or instructions.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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(c) that the relevant defect is not caused in whole or in part by a defect in Buyer Design which has been used for manufacturing or assembly of the concerned Goods and that such defect in Buyer Design could not reasonably have been detected by Seller prior to commencement of the manufacture or assembly.

9.2 Seller shall, at its own option and cost, repair or replace any defective Goods during a warranty period of twenty four (24) months starting from the delivery of the respective Goods. Such replacement or repair of Goods shall be made professionally by Seller as soon as practicable from the return of the Goods to Seller by Buyer in accordance with the applicable RMA and Seller’s return procedures, but never later than the Lead Time

9.3 In case of defective Goods, Seller shall provide Buyer with detailed, relevant information regarding (but not limited to):

(a) The nature and extent of the defect,

(b) The cause of the defect,

(c) The delivered lots/batches/orders that are affected.

(d) Preventive actions taken to avoid defective Goods.

9.4 Where Seller does not comply with its repair / replace obligation within the time period specified in Subarticle 9.2 above, Buyer shall have the right and option, at Seller’s cost, to either:

(a) repair or replace, or have repaired or replaced, any defective Goods; or

(b) purchase substituting goods.

Should Buyer decide to exercise a remedy in accordance with this Subarticle, Buyer shall provide Seller a written notice thereof. Seller shall reimburse Buyer promptly.

9.5 In addition to the warranties above, Seller shall be obligated to remedy any systematic defects in the Goods during a period of five (5) years from the delivery of such Goods to Buyer. A systematic defect is a defect for which Seller is responsible under Subarticle 9.1 which is of the same or substantially the same type, that appears or is likely to appear in more than [*] of the respective Goods delivered during any relevant time period, such time period to be determined by Buyer in its sole discretion. In case of a systematic defect in the Goods, Seller shall promptly:

(a) co-operate with Ericsson through interaction between the quality departments of both Seller and Ericsson in good faith and use commercially reasonable efforts to diagnose the root cause, and (i) plan an initial work-around (or similar) and effect a permanent solution (ii) produce and present, at its cost, a corrective action plan with appropriate milestones to eliminate the Systematic Defect and remedy the root cause of the suspected Systematic Defect in its and/or its subcontractors’ manufacturing of the Goods;

(b) at no charge to Buyer, replace all units of the respective Goods delivered up to the time that the systematic defect has been remedied by Seller;

(c) reimburse Buyer for the actual costs for investigating and analyzing the scope of and consequences resulting from the systematic defect, and the actual costs for the removal and replacement of such defective Goods at the Sites; and

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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(d) reimburse Buyer for any Customer Damages incurred by Buyer in connection with such defective Goods.

9.6 The warranty for repaired or replaced parts of the Goods shall be treated as set out in Subarticles 9.1-9.5. The warranty period shall start at the date of delivery of the repaired or replaced Goods.

9.7 Goods returned under this Article 9 will be delivered to Seller at Seller’s expense and risk. The replacement Goods shall be delivered to Buyer at Seller’s expense and risk.

Provided, however, notwithstanding anything herein to the contrary, Seller’s liability for claims under Subarticles 9.5 c) and 9.5 d) of this Agreement shall be limited as follows;

(a) For claims arising during the years 2010 and 2011, Seller’s liability under Subarticles 9.5 c) and 9.5 d) shall not exceed, for each calendar year, the higher of (i) ten million United States Dollars (US$ 10,000,000) or (ii) two (2) times the Aggregated Purchase Value; and

(b) For claims arising during the year 2012 and onwards, Seller’s liability under Subarticles 9.5 c) and 9.5 d) shall not exceed, per each damage occasion, the higher of (i) twenty million United States Dollars (US$ 20,000,000) or (ii) two (2) times the Aggregated Purchase Value.

This Article 9 shall be the sole and exclusive remedy of Buyer and the sole and exclusive obligation of Seller in the event of Goods that fail to comply to the warranty standards set forth herein.

EXCEPT AS SET OUT HEREIN, SELLER HEREBY DISCLAIMS ANY AND ALL ADDITIONAL WARRANTIES, WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, INCLUDING WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

10 DELAY

10.1 Should Seller discover that the delivery date set out in a Contract cannot be met, Seller shall immediately notify Buyer in writing, stating the cause of the delay and its best estimate of when delivery can be made. Such a notification shall not limit Seller’s liability for the delay.

10.2 Buyer shall be entitled to liquidated damages in case of delayed deliveries, provided Buyer is not responsible, in whole or in part, for the specific reason for the delay. The liquidated damages shall for each commenced week of delay be [*] of the price referable to the Goods that have been delayed or cannot be used as a consequence of the delay. The liquidated damages shall not, however, exceed a total of [*] per cent of the Contract price referable to the Goods that have been delayed or cannot be used as a consequence of the delay.

The liquidated damages may be deducted by Buyer from amounts payable to Seller with respect to the particular product in question, or may be claimed by other means

10.3 Not more than [*] in a calendar quarter, (unless specifically agreed in any SPA or otherwise agreed between the Parties in writing on a case-by-case basis), Buyer may designate certain line item(s) on a purchase order as prioritized (“Prioritized Line Item”). Prioritized Line Items must be specified as such in the purchase order issued by Buyer and a written notification must be provided to Seller’s designated contact person for such Prioritized Line Item. If the purchase order is issued by a Buyer other than Ericsson, then the designation must be confirmed by Ericsson in other prior written notification in conjunction with the purchase order provided to Seller’s designated contact for receipt of such prioritized order notification. Without limiting the generality of Subarticle 5.1, a Prioritized Line Item means that a precise delivery precision is of utmost importance for Buyer regarding such identified deliveries. For such Prioritized Line Items, Buyer shall have the right to claim liquidated damages in case of delayed deliveries, provided Buyer is not responsible for the specific reason for the delay. The liquidated damages for prioritized deliveries shall for each commenced day of delay be [*], except that the total amount of liquidated damages per incident shall not exceed [*].

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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For the avoidance of any doubt, the concept described in the foregoing paragraph, does not mean that normal deliveries shall receive lesser attention by Seller. All deliveries shall be handled professionally by Seller and in accordance with this Agreement, and Buyer expects high delivery precision regarding all deliveries.

10.4 The payment of liquidated damages shall not relieve Seller from the obligation to deliver the Goods.

10.5 After [*] of delay, Buyer is entitled to terminate the Contract or any part thereof. The relevant liquidated damages shall be calculated up to and include the day of termination, and shall be paid by Seller. In case of termination, should Buyer’s damages because of the delay exceed the relevant liquidated damages, Buyer shall be entitled to claim compensation for the excess amount. The liquidated damages and actual damages per event, shall however not exceed [*]. Seller’s aggregated liability under subarticles 10.2 and 10.3 shall however, in any calendar year not exceed [*].

11 PRODUCT LIABILITY

Should the Goods have a defect which causes damage to persons or to property other than such Goods, Seller shall indemnify and hold Buyer harmless for any such damage, except to the extent such injury or damage is caused by a defective Buyer Design used for manufacture of the said Goods. However, Seller shall not be liable for any damages arising if; (i) the Goods are used in any nuclear, aviation, medical or life sustaining application, or in any other inherently dangerous applications, not including ordinary business or administrative functions associated with such applications (“Inherently Dangerous Applications”), and (ii) the relevant damage is determined to have arisen solely as a direct result of such Inherently Dangerous Applications.

12 CONTINUITY OF SUPPLY

12.1 Seller shall inform Ericsson as soon as possible in writing (the “Notice”) if any of the Goods that at any time has been purchased under this Agreement are to be changed technically or of any plans to suspend or close down manufacturing of the Goods, in order to permit the Ericsson Companies and/or Authorized Companies to place consolidated purchase orders for future demands.

12.2 The Ericsson Companies and the Authorized Companies shall always be entitled to purchase the Goods as long as the SPA is in effect. In addition, the Ericsson Companies and the Authorized Companies shall be entitled to place consolidated purchase orders for Goods within [*] from the expiry or termination of the SPA and/or the date of receipt of the Notice as per Subarticle 12.1, for delivery within [*] from the date(s) of such purchase orders. If the SPA has expired at the dates of the said purchase orders, the SPA valid between the parties at the date of Ericsson’s receipt of the Notice shall regulate the said purchase orders.

12.3 Seller shall establish and maintain a secure sourcing plan including regularly updated business continuity and business contingency plans. The plan shall show the measures Seller will take in order to secure continuous supply to Ericsson and Buyer without interruption in relation to the supply of the Goods.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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Seller shall keep Ericsson informed of the actions anticipated by such secure sourcing plan. In the event Seller would like to amend the plan, Ericsson and Seller shall discuss the amendments in good faith and endeavor to agree on the amendments.

12.4 The secure sourcing plan shall, as a minimum, conform with the following:

(a) a back-up site/resource shall be identified for each relevant production site.

(b) a person responsible for initiating the secure sourcing plan activities shall be appointed for each relevant site.

(c) key personnel shall be appointed and reasonably trained on Ericsson specific product requirements. Alternatively, personnel in the facilities concerned shall be prepared to be transferred to the dedicated back-up capacity. Routines shall be established for training in relation to actions included in the secure sourcing plan and actions for the distribution of information contained in the secure sourcing plan.

(d) organizational matters.

(e) precautionary actions against disruptions.

(f) reporting of incidents and such reporting shall follow any general incident reporting procedures stated by Ericsson.

12.5 All costs related to any secure sourcing measure shall be born by Seller.

12.6 Ericsson and the Ericsson Companies placing orders under an SPA shall be allowed to review the plan. Routines shall also be in place in order to keep the secure sourcing plan updated at all times.

12.7 Seller shall use reasonable efforts to ensure that the requirements/activities in the secure sourcing plan are supported by corresponding requirements/activities in relation to Seller’s suppliers and contractors. Consequently, Seller shall have corresponding requirements on its suppliers and contractors.

12.8 Seller shall ensure that it has, and use reasonable efforts to ensure that its contractors and suppliers have sufficient insurance (e.g. business interruption and liability insurances). Seller shall actively work with its contractors and suppliers with risk management. Seller shall use commercially reasonable efforts to safeguard that production of so-called critical components is not located to a single location.

12.9 Due to the fact that Ericsson will be heavily dependent on successful and continuous deliveries of the Goods from Seller, Seller shall inform and discuss any material plans for disposing or relocating of its manufacturing facilities with Ericsson and/or any other activities that could have a materially adverse effect on Ericsson or any Buyer.

13 INTELLECTUAL PROPERTY RIGHTS

13.1 Buyer and Ericsson Companies shall obtain and retain full and complete ownership to any Buyer Design, Buyer Documentation as well as all Intellectual Property Rights incorporated therein. Seller shall always assist and issue necessary documents in order to secure such ownership.

13.2 Without limiting the applicability of Subarticles 13.1,13.3 and 13.4 nothing contained herein shall be construed as giving a party any ownership, license or other rights with respect to any Intellectual Property Rights owned or controlled by the other party, and such Intellectual Property Rights shall

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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always remain the legal and absolute property of the party owning or controlling it, unless otherwise provided for herein or separately agreed upon between the parties in writing.

13.3 A Seller being party to a Contract for which a Buyer Design has been furnished is granted a non-exclusive, restricted, non-transferable and non-sublicensable license to use such Buyer Design only for the assembly and/or manufacturing of the Goods for Buyer under the relevant Contract.

13.4 Buyer and Ericsson Companies shall have a perpetual, world-wide royalty free right to use Seller’s and any Seller Company’s Intellectual Property Rights forming part of the Goods for the sole and exclusive purpose of supporting the sale, marketing, distribution and other use and commercial exploitation of the Goods.

13.5 Seller shall not assert any Intellectual Property Rights against Buyer, Ericsson Companies, distributors and customers (purchasers and users) based exclusively on the use, sale, distribution or other disposal of any Goods or for the assembly, use, sale, distribution or other disposal of a combination of such Goods with other products.

13.6 Further, Seller shall not, without Ericsson’s prior approval, use Buyer’s or any Ericsson Company’s name and/or corporate logotype in Seller’s informational, promotional, advertising or any other material.

13.7 This Article shall survive the termination of this Agreement, for any reason.

14 INFRINGEMENT

14.1 Seller shall defend, indemnify and hold harmless Buyer and any Ericsson Company and Authorized Company (each, an “Indemnitee”), from and against any and all damages actually paid out, or otherwise demonstrably suffered, by the Indemnitee, and costs and expenses (including reasonable attorneys’ fees) incurred as a result of any claim, suit or proceeding brought against any of them based on the allegation that the use, sale, distribution or other disposal of any Goods furnished by Seller under this Agreement constitutes an infringement of any Intellectual Property Rights; provided that Seller has been notified without undue delay in writing of such claim, suit or proceeding and given the possibility and information to, participate in the settlement of the claim or in Buyer’s defense of any suit or proceeding. For purposes of clarification, the parties agree that Seller’s obligations under this Article 14.1 shall include an obligation to indemnify and hold harmless any Ericsson Company with respect to claims related to infringing Goods received from any customer to which such Goods have been sold, based on contractual obligations of such Ericsson Company towards the customer. However, the parties agree that Seller shall not be liable under this Article 14.1 for any lost business opportunities, lost production, lost data, lost goodwill, lost anticipated savings, lost revenue or similar unforeseeable indirect, incidental or consequential damages incurred by an Indemnitee, or by a customer of any Ericsson Company to which infringing Goods have been sold.

14.2 In the event that the Goods or any part thereof are in such suit or proceeding held to constitute such an infringement or their further use, sale, distribution or other disposal is enjoined, Seller shall promptly, at its own expense and option, either:

(a) procure for Buyer, Ericsson Companies, and Authorized Companies the right to continue the use, sale, distribution or other disposal of such Goods;

(b) replace the Goods with non-infringing goods of equivalent function and performance; or

(b) modify such Goods so that they become non-infringing without detracting from function or performance

14.3 Notwithstanding anything in this Agreement to the contrary, Seller’s obligations set out in Subarticle 14.1 and 14.2 shall not apply to the extent the claim of infringement would not have occurred but for (a) a combination of the Goods with any device, product or equipment not provided Seller or not authorized by Seller in writing, or (b) any modification by a party other than Seller of the Goods delivered by Seller that has not been authorized and approved by Seller in writing, or (c) in cases where Seller can prove (i) that the said suit, claim or proceeding is based solely on a Buyer Design, and (ii) that the Goods concerned by the claim, suit or proceeding has been manufactured according to such Buyer Design only, (iii) that the suit, claim or proceeding would not otherwise have arisen independent from such Buyer Design and (iv) that Seller was not aware of that such Buyer Design was infringing Intellectual Property Rights of a third party.

14.4 This Article shall survive the termination of this Agreement, for any reason

15 BUYER DOCUMENTATION TOOLS AND BUYER DESIGN

15.1 Any Buyer Documentation and any Buyer Tools are the exclusive property of Buyer or Ericsson. A Seller being party to a Contract for which Buyer Documentation has been furnished to such Seller is granted a non-exclusive, restricted, non-transferable and non-sublicensable license to use such Buyer Documentation and Buyer Tools only for the manufacture of the Goods for Buyer under the relevant Contract.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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15.2 Seller shall keep Buyer Tools stored separately. Buyer Tools shall be registered and marked with Buyer’s or Ericsson’s name, and the product number or a mutually agreed identification number. A copy of this record shall be submitted to Buyer or Ericsson upon request. Buyer Tools shall be maintained and insured by Seller, and may not be used, changed, scrapped, sold or disposed otherwise than as directed by Buyer or Ericsson.

15.3 Upon the expiration or termination of this Agreement, or upon the owner’s request, all in the discretion of Ericsson, Seller shall return to the owner any Buyer Tools, any Buyer Documentation, or any other Ericsson Company assets in Seller’s possession.

15.4 Upon delivery of a Buyer Design, Seller shall without delay investigate the Buyer Design in order to verify that it is free from defects and deficiencies and is fit for its intended purpose. In the event any defects or deficiencies in the Buyer Design are found to exist, Seller shall without delay inform Buyer in writing thereof and, unless Buyer instructs otherwise in writing, refrain from manufacturing of Goods using such defective Buyer Design.

16 EXPORT AND IMPORT

16.1 Seller is responsible for obtaining and maintaining any export license(s) required for delivery of the Goods to Buyer.

16.2 If Seller is unable to obtain or maintain the export license(s), Buyer may terminate any related Contract or part thereof, which may be affected by the aforesaid license.

16.3 Seller shall inform of and issue all documentation which may be required by law, regulation or reasonably requested by Buyer regarding the export, import or re-export of the Goods. In particular, Seller is responsible to continuously provide detailed technical documentation, certificate of origin (both for so called commercial and preferential origin) and the so called export control classification number (the “ECCN code”) for the Goods according to the SE/EU/US export administration regulations, or the corresponding data according to other applicable regulations. This information shall be updated on an ongoing basis when new regulations come into effect.

16.4 Seller shall provide the information requested by Buyer in accordance with Subarticle 16.3 within [*] from the request.

17 CONFIDENTIALITY

17.1 Subject to this Article, Ericsson Companies, and Authorized Companies are entitled to receive a copy of this Agreement and any relevant SPA.

17.2 Seller and Buyer shall maintain confidentiality and not, without the other party’s prior consent, disclose to any third party any documentation and any information designated by the furnishing party as confidential, whether of a commercial or a technical nature, furnished pursuant to this Agreement, i.e. the receiving party shall use the information only for the purposes of this Agreement. Such documentation and information may, however, be disclosed by Buyer to another Ericsson Company, Distributor, and Authorized Company or a customer under similar conditions of confidentiality.

17.3 Seller shall ensure that neither it nor any of its subcontractors and/or suppliers advertise, publish or otherwise disclose the appointment of Seller,

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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or its subcontractors or the terms of this Agreement, any SPA or any Contract concluded hereunder without Ericsson’s prior written approval. All copies of material relating thereto which is intended for publication in any form must first be submitted to Ericsson for approval.

17.4 Neither party shall be liable for disclosing any confidential information if it was:

(a) public knowledge at the time of disclosure or thereafter becomes generally known other than through an act of negligence by the receiving party;

(b) already known to the other party prior to its receipt from the disclosing party;

(c) demonstrably developed at any time by the receiving party without any connection with the information received hereunder;

(d) rightfully obtained by a party from other unrestricted sources, or e) disclosed with the prior written permission of the disclosing party.

(e) disclosed with the prior written permission of the disclosing party.

17.5 This Article 17 shall for five (5) years, survive the termination of this Agreement for any reason.

18 FORCE MAJEURE

18.1 The performance of either party, required by this Agreement, any SPA or any Contract, shall be extended by a reasonable period of time if such performance of the respective party is impeded by an unforeseeable event beyond such party’s control, which shall include but not be limited to acts of God, industrial actions, riots, wars, embargo or requisition (acts of government), hereinafter referred to as “Force Majeure”.

18.2 In case of Force Majeure, the relevant party shall promptly notify and furnish the other party in writing with all relevant information thereto.

18.3 Should an event of Force Majeure continue for more than three (3) months, Buyer shall have the right to terminate any relevant Contract. In such a case, Buyer shall pay to Seller the price of Goods delivered up to the date of termination plus unrecovered expenses incurred by Seller which could not reasonably be avoided.

19 TERM AND TERMINATION

19.1 This Agreement shall become effective upon signature by both parties and shall remain in effect until one (1) year following written notice of termination by either party.

19.2 Any applicable party may at any time terminate this Agreement, any SPA, and/or any Contract, with immediate effect and without compensation to the other party if the other party should pass a resolution, or any court should make an order, that the other party shall be wound up or if a trustee in bankruptcy, liquidator, receiver, or manager on behalf of a creditor should be appointed.

19.3 Any applicable party may terminate this Agreement or any SPA, with immediate effect if the other party has committed a material breach of this

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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Agreement or the SPA, and not taken substantial steps to rectify the same within thirty (30) calendar days after receiving written notice of termination specifying the breach.

19.4 Either party may terminate any Contract, with immediate effect if the other party has committed a material breach of the Contract, and not taken substantial steps to rectify the same within thirty (30) calendar days after receiving written notice of termination specifying the breach.

19.5 Provisions contained in this Agreement that are expressed or by their sense and context are intended to survive the expiration or termination of this Agreement, shall so survive the expiration or termination.

20 CONTACT PERSONS

Ericsson’s and Seller’s contact persons regarding this Agreement are set out below.

Ericsson AB	Seller
Name: Lars Tjusberg phone: +46 10 719 8288 address: Box 1505 S-125 25 Älvsjö, Sweden e-mail: lars.tjusberg@ericsson.com fax: +46 10 719 7675	Name: Ronnie Vasishta phone: +1 408 855 3035 address: 2585 Augustine Drv. Santa Clara, CA 95054 e-mail: ronnie@eASIC.com fax: +1 408 855 9201
with a copy to:
Ericsson AB
Attn. Group Function Legal Affairs Address: Torshamnsgatan 23 SE-164 80 Stockholm, Sweden Fax: +46 8 585 30039

21 LIMITATION OF LIABILITY

21.1 EXCEPT AS EXPRESSLY PROVIDED IN SUBARTICLE 21.2 AND ELSEWHERE IN THIS AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY INDIRECT OR CONSEQUENTIAL DAMAGES OF ANY NATURE OR KIND WHATSOEVER, INCLUDING BUT NOT LIMITED TO LOST PROFITS, IN CONNECTION WITH OR ARISING OUT OF THE SALE AND PURCHASE OF THE PRODUCTS, EVEN IF THE OTHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

21.2 The limitation of liability provided in Subarticle 21.1 shall not apply to damages with respect to Articles 9 (Warranty), 10 (Delay), 11 (Product Liability) and 14 (Infringement), or if the defaulting party has been acting with gross negligence or with willful misconduct.

22 MISCELLANEOUS

22.1 Neither party may assign this Agreement, any SPA or any Contract without the prior written consent of the other party. Such consent shall not be unreasonably withheld. Notwithstanding this, Ericsson or the relevant Ericsson Company shall always be entitled to assign this Agreement or any SPA to another Ericsson Company. Provided, however, that this Agreement and all SPAs and Contracts may be assigned by a party in connection with the sale of all or substantially all of the assets of the business.

Notwithstanding the preceding paragraph, Ericsson specifically reserves the right to, upon written notice to relevant Seller Company, assume, enforce, settle, and/or collect the rights and/or obligations of any Authorized Company which such Authorized Company may have under this Agreement, any SPA or any Contract against such Seller Company. Through such notice, the relevant rights and/or obligations shall be considered assigned to Ericsson.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

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If a right and/or obligation is assigned to Ericsson by an Authorized Company in accordance with the preceding paragraph, the Authorized Company shall have no right and/or obligation to assume, enforce, settle or collect any such assigned rights and/or obligations.

22.2 This Agreement contains the entire agreement between the parties on the subject matter of this Agreement, and supersedes all representations, undertakings and agreements previously made between the parties with respect to the subject matter of this Agreement.

22.3 For the avoidance of any doubt, any and all pre-printed standard terms (e.g. on a purchase order, order acknowledgement, or invoice) shall not have any applicability unless the other party has expressly accepted the relevant term.

22.4 This Agreement, any SPA, or any Contract may be modified only by a written document duly signed by the parties and referencing this Agreement, the SPA, or the relevant Contract.

22.5 Should any provisions of this Agreement, any SPA or Contract, be or become invalid or unenforceable, this shall not affect the validity of the remainder of this Agreement, the SPA or Contract. In such event, the parties undertake to substitute for any such invalid or unenforceable provisions, a provision that corresponds to the spirit and purpose of the invalid or unenforceable provisions, so far as it is possible, with regard to the purpose of this Agreement, the SPA or Contract.

Non-Waiver. The failure by either party to enforce any provisions of this Agreement or to exercise any right in respect thereto shall not be construed as constituting a waiver of its rights thereof.

23 DISPUTES AND GOVERNING LAW

23.1 This Agreement, any SPA and any Contracts concluded under this Agreement shall be governed by and construed in accordance with the substantive laws of Sweden.

23.2 The parties shall make every effort to settle by amicable negotiations any difference which may occur between them in connection with this Agreement, any SPA or any Contract. If the parties fail to reach such an amicable settlement, either party may refer such differences to arbitration as provided below.

23.3 All disputes, differences or questions between the parties with respect to any matter arising out of or relating to this Agreement, any SPA or Contract shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce in Stockholm, Sweden, by three (3) arbitrators, appointed in accordance with the said Rules. The arbitration proceedings shall be conducted in the English language.

23.4 All awards may if necessary be enforced by any court having jurisdiction in the same manner as a judgment in such court.

23.5 The parties undertake and agree that all arbitral proceedings conducted under this Article 23 shall be kept confidential, and all information, documentation, materials in whatever form disclosed in the course of such arbitral proceeding shall be used solely for the purpose of those proceedings.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

-16-

**********************************

This Agreement has been duly signed in two (2) identical copies of which the parties have taken one (1) each.

Date: 2009-06-18		Date: 2009-06-12
eASIC Corporation		Ericsson AB
By	/s/ Ronnie Vasishta	By	/s/ Martin Johansson
Name:	Ronnie Vasishta	Name:	Martin Johansson
Title:	President and COO	Title:	Vice President BNET Sourcing
		Date: 2009-06-12
		Ericsson AB
		By	/s/ Lars Johansson
		Name:	Lars Johansson
		Title:	Director BNET Sourcing

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

-17-

ERICSSON CODE OF CONDUCT

Supply chain issues in the area of corporate social responsibility are of increasing global importance                     

increasingly important role in a company’s competitiveness, profitability and ultimately shareholder value                     

In order to ensure responsible corporate governance in the areas of basic human rights, labor standards                     

management and anti-corruption in the workplace, Ericsson’s CODE OF CONDUCT was established in May                     

Ericsson has based its CODE OF CONDUCT on the United Nations Global Compact an international initiative                     

by corporations around the world to ensure accountability in the areas noted above

FOR FURTHER INFORMATION: www.ericsson.com/sustainability

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

-18-

Code of Conduct *

Human Rights

We support and respect the protection of internationally proclaimed human rights. We make sure that we are not complicit in human rights abuses.

Labor Standards

FREEDOM OF ASSOCIATION

As far as any relevant laws allow, all employees are free to form and to join or not to join trade unions or similar external representative organizations and to bargain collectively.

FORCED LABOR

Forced, bonded or compulsory labor is not used and employees are free to leave their employment after reasonable notice as required by national law or contract. Employees are not required to lodge deposits of money or identity papers with their employer.

EMPLOYMENT CONDITIONS

Employees understand their employment conditions. Pay and terms are fair and reasonable, and comply at a minimum with national laws or Industry standards whichever is higher. Working hours comply with national laws and are not excessive.

CHILD LABOR

No person is employed who is below the minimum legal age for employment. Minimum age Is the age of completion of compulsory schooling, or not less than 15 years (or not less than 14 years, in countries where educational facilities are Insufficiently developed) as set out in Article 2.4 In the ILO Convention No.138 on Minimum Age.

Children are not employed for any hazardous work, or work that is Inconsistent with the child’s personal development. A child means a person below the age of 18 years, as defined In Article 1 of the United Nations Convention on the Rights of the Child. Personal development includes a child’s health or physical, mental, spiritual, moral or social development as described in the Article 32 of the United Nations Convention on the Rights of the Child.

Where a child is employed, the best Interests of the child shall be the primary consideration. Policies and programs that assist any child found to be performing child labor are contributed to, supported, or developed.

ELIMINATION OF DISCRIMINATION

Employees are treated with respect and dignity. Corporal punishment, physical or verbal abuse or other unlawful harassment and any threats or other forms of intimidation are prohibited.

All kinds of discrimination based on partiality or prejudice is prohibited such as discrimination based on race, color, sex, sexual orientation, marital status, pregnancy, parental status, religion, political opinion, nationality, ethnic background, social origin, social status, indigenous status, disability, age, union membership and any other characteristic protected by local law, as applicable.

Employees with the same qualifications, experience and performance receive equal pay for equal work with respect to their relevant comparators.

WORKING CONDITIONS

A healthy and safe working environment, and if applicable, housing facilities are provided for employees, in accordance with international standards and national laws.

Appropriate health and safety information and training is provided to employees. Safety includes e.g. clearly marked and unblocked exits, emergency exits and evacuation plans on each floor, regularly tested fire alarm and evacuation drills, first aid equipment, safe and correct handling, marking and labeling of chemicals, machinery and work processes.

The workplace, and if applicable, housing facilities, has tolerable temperature and noise level, adequate ventilation, sufficient lighting, clean toilet facilities, drinkable water and, if applicable, sanitary facilities for food storage.

Environment

Finite resources are used responsibly and carefully. Operational practices that reduce any environmental burden associated with our activities are promoted. Innovative developments in products and services that offer environmental and social benefits are supported.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

-19-

Anti-Corruption

No form of extortion and bribery, including improper offers for payments to or from employees, or organizations, is tolerated.

* The Ericsson CODE OF conduct is based on the United Nation Global Compact’s ten principles derived from:

The Universal Declaration of Human Rights, The International Labor Organization’s Declaration of Fundamental Principles and Rights at Work, The Rio Declaration on Environment and Development and The United Nations Convention Against Corruption.

http://www.unglobalcompact.org/

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

-20-

		Open DIRECTIVE		1 (5)
Prepared (also subject responsible if other)		No.
KI/EAB/RWT/UL Richard Trankell (editor)		034 01-2294 Uen
Approved	Checked	Date	Rev	Reference
LME/MD (Torbjörn Nilsson)		2003-06-12	B

The Ericsson lists of banned and restricted substances

1 Application

This directive is valid for the entire Ericsson group and is applicable for design, purchasing and manufacturing of products and packaging that Ericsson places on the market. This directive is not applicable for defense material exempted by legislation.

2 Purpose

These lists of banned, restricted and observation substances have been compiled to meet existing and anticipated legal requirements and market demands.

3 Directive

Products and packaging that Ericsson places on the market, and manufacturing operations at Ericsson and supplier sites, shall comply with the requirements in the Banned, Restricted and Observation lists.

4 Definitions

There are three lists that are applicable to products and three lists that are applicable to manufacturing operations. The lists are sub-grouped in terms of banned, restricted and observation status.

The requirements in the lists apply to substances that are intentionally added regardless of the concentration. The lists do not apply in cases where the substance is present due to natural impurities below limits specified in applicable legislation. The lists are based on existing and anticipated legal requirements and market demands, mainly from EU and in most cases also USA and Japan. The legislation listed in the banned lists are examples of applicable laws; please note that the legislation may have been amended and is not to be used as a complete list of laws applicable to the substance in question. Other environmental legislation may exist on specific markets.

Banned

The banned list documents substances that are banned for the application(s) specified in the list.

Restricted

The restricted list documents substances that shall be substituted no later than the date specified in the list.

Observation

The observation list documents substances that shall be substituted as soon as technically, economically and environmentally acceptable alternatives are available.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

-21-

		Open DIRECTIVE			3 (5)
Prepared (also subject responsible if other)		No.
KI/EAB/RWT/UL Richard Trankell (editor)		034 01-2294 Uen
Approved	Checked	Date	Rev	Reference
LME/MD (Torbjörn Nilsson)		2003-06-12	B

The Ericsson list of banned substances (in products), 2(2)

	Group of substances	Substance	Banned application	Principal legislation	Main use	Main risk
3	Other organic compounds	Certain azo compounds with carcinogenic amines	All applications	2002/61/EC adds certain azo colorants to 76/769/EEC	LCDs & plastics	Carcinogenic
		Creosotes	All applications	94/60/EEC	In wood preservation	Toxic
		Formaldehyde (CAS-no. 50-00-0)	All applications	ChemVerbots V (Germany)	As preservative	Allergenic
		Tributyltin compounds	All applications	69/677/EEC, 99/51/EEC, Japanese legislation	In paint	Toxin
		Triphenyltin compounds
4	Other compounds	Asbestos	All applications	76/769EEC, 83/478EEC, 85/610EEC, 91/659EEC	As insulation material	Carcinogenic

The Ericsson list of restricted substances (in products)

	Group of substances	Substance	Restriction	Banned application	Main risk
1	Metals and their compounds	Cadmium and its compounds	Banned from 1 July 2006	According to RoHS directive (2002/95/EG)	Toxic
		Chromium (VI) compounds	Banned from 1 July 2006	According to RoHS directive (2002/95/EG)	Allergenic & toxic
		Lead and its compounds	Banned from 1 July 2006	According to RoHS directive (2002/95/EG)	Bioaccumulative & carcinogenic

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

		Open DIRECTIVE		5 (5)
Prepared (also subject responsible if other)		No.
KI/EAB/RWT/UL Richard Trankell (editor)		034 01-2294 Uen
Approved	Checked	Date	Rev	Reference
LME/MD (Torbjörn Nilsson)		2003-06-12	B

The Ericsson list of banned substances (in production)

	Group of substances	Substance	Banned application	Principal legislation	Main use	Main risk
1	Halogenated hydrocarbons	CFCs-chlorofluorocarbons	All applications	Regulation (EC) 2037/2000, Montreal Protocol, US Clean Air Act, Japan: Ozone Layer Protection act	Refrigerants & solvents	Ozone depletion
		HCFCs-hydrochlorofluorocarbons	All applications
		Carbon tetrachloride (CAS-no. 56-23-50	All applications	Regulation (EC) 2037/2000, Montreal Protocol, US Clean Air Act, Japan: Ozone Layer Protection Act	As solvents	Ozone depletion
		Chlorobromomethane (CAS-no. 74-97-5)
		1.1.1-trichloroethane CAS-no. 71-55-6)
		Methylene chloride CAS-no. 75-09-2)	All applications	94/60//EEC, Japan: Waste disposal law	As solvents	Carcinogenic
		Tetrachloroethylene CAS-no. 127-18-4)
		Trichloroethylene CAS-no. 1979-01-06)

The Ericsson list of restricted substances (in production)

	Group of substances	Substance	Restriction	Banned application	Main risk
1	Halogenated hydrocarbons	Methyl bromide CAS-no. 74-83-9)	Banned from 2005	Applications other than quarantine and pre-shipment applications (Regulation (EC) 2037/2000)	Ozone depletion
			Banned from 2015	Quarantine and pre-shipment applications (Regulation (EC) 2037/2000)

The Ericsson list of substances for observation (in production)

	Group of substances	Substance	Banned application	Main risk
1	Halogenated hydrocarbons	FCs – fluorocarbons	Refrigerants	Global warming
		HFCs – fluorohydrocarbons	Solvents & refrigerants
2	Other organic compounds	Nonylphenolethoxylates (CAS-no. 9016-45-9)	As surfactant in cleaning agents	Bioaccumulative

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

Exhibit 3 to READ-2009:192839

PRODUCT PURCHASING RIGHTS EXHIBIT

This Product Purchasing Rights Exhibit is attached to and hereby made a part of the General Purchase Agreement between Ericsson and Seller dated 18 June 2009 (hereinafter referred to as “Agreement”).

1. Upon the occurrence of the Trigger Event (as defined below), Seller shall grant to Ericsson a royalty-free, worldwide, non-exclusive license under Seller’s Intellectual Property Rights (with right of sublicense to any Ericsson Company and Authorized Company) during the Term of the Agreement to order, purchase and take delivery of the Goods and to market, sell and distribute such Goods within the permissible scope as defined in the Agreement (the “Permitted Purpose”).

2. Upon the occurrence of the Trigger Event, Seller and Ericsson will promptly meet in order to discuss what measures and commercial terms are reasonably necessary in order for Ericsson or Ericsson’s authorized sublicensees to commence exercising their purchase rights as granted pursuant to Section 1 above, including engaging in discussions with Seller’s suppliers to enact procedures that would allow delivery of Goods directly to Ericsson, or Ericsson’s authorized sublicensees. Seller will provide to Ericsson the names and points of contact for the semiconductor fabricating contractor (currently Chartered Semiconductor for [*] and Fujitsu Manufacturing Limited for [*]) and the packaging contractor (currently Amkor for [*] and Kyocera for [*]) Seller has contracted to manufacture the Goods. Ericsson agrees that such information is Seller’s Confidential Information and Ericsson shall disclose such information only upon the grant of a license to Ericsson in accordance with this Exhibit and only for the Permitted Purpose, and then only to Ericsson’s employees, consultants, contractors or subcontractors with a need to know and who have executed a confidentiality agreement with Ericsson.

3 (a) If the Trigger Event occurs prior to completion of the agreement referenced in Section 3(b) below, Seller shall identify for Ericsson an individual who is knowledgeable about and trained in Seller’s supplier ordering procedures and supply chain logistics applicable to the Goods. That person will be assigned to assist Ericsson in planning and managing purchases and placing orders on behalf of Ericsson, or Ericsson’s authorized sublicensees, for the Goods with Seller’s suppliers for the Permitted Purpose, for a period of not more than [*].

(b) [*] of the date of execution of this Agreement, Seller will use commercially reasonable best efforts to enter into an agreement with a third party supplier through whom Ericsson or its designated Buyers may place orders for Goods for the Permitted Purpose if Seller is unable to do so because of the occurrence of a Trigger Event. Such agreement shall be presented to Ericsson and include all necessary licenses to enable Ericsson, or Ericsson’s authorized sublicensees, to place such orders for Goods. Provided, however, that Ericsson shall not be entitled to place such orders or otherwise purchase the Goods from or through such third party supplier except in the case that a Trigger Event has occurred, and then only in accordance with the Agreement and this Exhibit. Upon reaching the agreement with the third party supplier under this Section 3(b), Seller’s obligation under Section 3(a) shall terminate and be of no further force or effect. In case Seller has not, despite using its commercially reasonable best efforts, succeeded in reaching such an agreement within the above time period, then the Parties shall meet to discuss in good faith alternative solutions, including a possible escrow arrangement.

4 For purposes of this Exhibit, “Trigger Event” shall mean a situation where;

(a) Seller is unable to supply Goods in accordance with the terms of the Agreement due to the fact that;

(i) it enters into a bankruptcy proceeding ceases to operate, or

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

(ii) substantially all of its business are terminated or are discontinued, or

(iii) it is liquidated or dissolved which make it impractical for it to perform under the Agreement, or

(iv) it makes an assignment for the benefit of creditors, and such condition is not cured within [*]; or

(b) Seller, despite its ability to do so, is unwilling, and thereby fails, to supply Goods as required by the terms of the Agreement for more than [*] after the operative delivery date under a purchase order in accordance with the terms of the Agreement; or

(c) Seller is merged into or acquired by a competitor of Ericsson which, despite its ability to do so, is unwilling, and thereby fails, to supply Goods as required by the terms of the Agreement for more than [*] after the operative delivery date under a purchase order in accordance with the terms of the Agreement.

5 In the event that Ericsson, or Ericsson’s authorized sublicensees, should exercise the rights granted under this Product Purchasing Rights Exhibit to order, purchase and take delivery of Goods under the Agreement directly from Seller’s Suppliers, Ericsson agrees to pay Seller or any Seller beneficiary the difference, if any, between the unit price it was to pay Seller as agreed in any applicable SPA for the Good and the actual per unit cost Ericsson or Ericsson’s Buyer pays in total for the Good directly to Seller’s suppliers.

[*] = Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested under 17 C.F.R. Sections 200.80(b)(4) and 230.406.

EX-10.19

Exhibit 10.19

LOAN AND SECURITY AGREEMENT

THIS LOAN AND SECURITY AGREEMENT (this “Agreement”) dated as of September 29, 2010 (the “Effective Date”) between SILICON VALLEY BANK, a California corporation (“Bank”), and EASIC CORPORATION, a Delaware corporation (“Borrower”), provides the terms on which Bank shall lend to Borrower and Borrower shall repay Bank. The parties agree as follows:

1 ACCOUNTING AND OTHER TERMS

Accounting terms not defined in this Agreement shall be construed following GAAP. Calculations and determinations must be made following GAAP (except for non-compliance with FAS123R in the monthly reporting). Capitalized terms not otherwise defined in this Agreement shall have the meanings set forth in Section 13. All other terms contained in this Agreement, unless otherwise indicated, shall have the meaning provided by the Code to the extent such terms are defined therein.

2 LOAN AND TERMS OF PAYMENT

2.1 Promise to Pay.

Borrower hereby unconditionally promises to pay Bank the outstanding principal amount of all Credit Extensions and accrued and unpaid interest thereon as and when due in accordance with this Agreement.

2.1.1 Growth Capital Advances.

(a) Availability. Bank shall make a growth capital loan available to Borrower in two (2) tranches (“Tranche A” and “Tranche B”; each advance under Tranche A and Tranche B hereinafter referred to individually as a “Growth Capital Advance” and collectively as “Growth Capital Advances”) not exceeding the Growth Capital Line. Subject to the satisfaction of the terms and conditions of this Agreement, (i) Bank will fund Tranche A on the Effective Date in a single advance not to exceed Three Million Dollars ($3,000,000) (the “Tranche A Advance”), and (ii) provided that Borrower has achieved the Tranche B Advance Milestone prior to the date of such Growth Capital Advance under Tranche B (each a “Tranche B Advance”, and collectively, the “Tranche B Advances”), Tranche B will be available during the Tranche B Draw Period in up to three (3) Tranche B Advances in an aggregate amount not to exceed Two Million Dollars ($2,000,000). Each Tranche B Advance must (i) be in an amount at least equal to the lesser of Five Hundred Thousand Dollars ($500,000) or the amount that has not yet been drawn under Tranche B of the Growth Capital Line and (ii) only be used to finance Eligible Purchase Orders. After repayment, no Growth Capital Advance may be reborrowed.

(b) Repayment. Borrower shall repay each Growth Capital Advance as follows:

(i) Pre-Conversion Date Growth Capital Advances. For each Growth Capital Advance made before the Conversion Date (each a “Pre-Conversion Date Growth Capital Advance”, and collectively, the “Pre-Conversion Date Growth Capital Advances”),

1.

Borrower shall make monthly payments of accrued interest only commencing on the last calendar day of the month immediately following the Funding Date on which such Growth Capital Advance occurs (or commencing on the Funding Date if the Funding Date is the last calendar day of the month) and on the last calendar day of each month thereafter during the Growth Capital Interest Only Period. Commencing on the last calendar day of the first (1^st) month on which the Conversion Date occurs and continuing on the last calendar day of each month thereafter during the Growth Capital Repayment Period, Borrower shall make equal monthly payments of principal and accrued interest, which would fully amortize each such Growth Capital Advance over the Growth Capital Repayment Period.

(ii) Post-Conversion Date Growth Capital Advances. For each Growth Capital Advance made on or after the Conversion Date (each a “Post-Conversion Date Growth Capital Advance”, and collectively, the “Post-Conversion Date Growth Capital Advances”), Borrower shall make equal monthly payments of principal and interest, which would fully amortize such Growth Capital Loan Advance over the Growth Capital Repayment Period commencing on the last calendar day of the month immediately following the Funding Date on which such Growth Capital Advance occurs (or commencing on the Funding Date if the Funding Date is the last calendar day of the month) and continuing on the last calendar day of each month thereafter during the Growth Capital Repayment Period. By way of example only, if a Post-Conversion Date Growth Capital Advance is made on April 15, 2012, then Borrower would make twenty-seven (27) equal monthly payments of principal and interest commencing on April 30, 2012 and on the last calendar day of each month thereafter, each in an amount which would fully amortize such Post-Conversion Date Growth Capital Advance over the Growth Capital Repayment Period.

All unpaid principal and accrued interest on each Growth Capital Advance shall be due and payable in full on the Growth Capital Maturity Date.

(c) Final Payment. With respect to each Growth Capital Advance, on the earlier of (i) the Growth Capital Maturity Date with respect to each Growth Capital Advance, or (ii) the acceleration of such Growth Capital Advance, Borrower shall pay, in addition to the outstanding principal, accrued and unpaid interest, and all other amounts due on such date with respect to such Growth Capital Advance, an amount equal to the Final Payment.

(d) Mandatory Prepayment Upon an Acceleration. If the Growth Capital Advances are accelerated following the occurrence of an Event of Default or otherwise, Borrower shall immediately pay to Bank an amount equal to the sum of (i) all outstanding principal, plus accrued and unpaid interest, plus (ii) the Final Payment, plus (iii) all other sums, if any, that shall have become due and payable hereunder with respect to the Growth Capital Advances, including interest at the Default Rate with respect to any past due amounts.

(e) Voluntary Prepayment. At Borrower’s option, so long as an Event of Default has not occurred and is not continuing, Borrower shall have the option to prepay all, but not less than all, of the Growth Capital Advances, provided Borrower (i) provides written notice to Bank of its election to exercise its option to prepay the Growth Capital Advances at least thirty (30) days prior to such prepayment, and (ii) pays, on the date of the prepayment (A) all accrued and unpaid interest with respect to the Growth Capital Advances through the date the prepayment is made; (B) all unpaid principal with respect to the Growth Capital Advances; (C) the Final Payment and (D) all other sums, if any, that shall have become due and payable hereunder with respect to this Agreement.

2.

2.1.2 Revolving Advances.

(a) Availability. Subject to the terms and conditions of this Agreement and to deduction of Reserves, Bank shall make Advances not exceeding the Availability Amount. Amounts borrowed hereunder may be repaid and, prior to the Revolving Line Maturity Date, reborrowed, subject to the applicable terms and conditions precedent herein.

(b) Termination; Repayment. The Revolving Line terminates on the Revolving Line Maturity Date, when the principal amount of all Advances, the unpaid interest thereon, and all other Obligations relating to the Revolving Line shall be immediately due and payable.

2.1.3 Letters of Credit Sublimit.

(a) As part of the Revolving Line, Bank shall issue or have issued Letters of Credit denominated in Dollars or a Foreign Currency for Borrower’s account. The aggregate Dollar Equivalent amount utilized for the issuance of Letters of Credit shall at all times reduce the amount otherwise available for Advances under the Revolving Line. The aggregate Dollar Equivalent of the face amount of outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit) may not exceed the lesser of (A) One Million Dollars ($1,000,000), minus (i) the sum of all amounts used for Cash Management Services, and minus (ii) the FX Reduction Amount, or (B) the lesser of Revolving Line or the Borrowing Base, minus (i) the sum of all outstanding principal amounts of any Advances (including any amounts used for Cash Management Services), and minus (ii) the FX Reduction Amount.

(b) If, on the Revolving Line Maturity Date (or the effective date of any termination of this Agreement), there are any outstanding Letters of Credit, then on such date Borrower shall provide to Bank cash collateral in an amount equal to one hundred five percent (105%) of the Dollar Equivalent of the face amount of all such Letters of Credit plus all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its good faith business judgment), to secure all of the Obligations relating to such Letters of Credit. All Letters of Credit shall be in form and substance acceptable to Bank in its sole discretion and shall be subject to the terms and conditions of Bank’s standard Application and Letter of Credit Agreement (the “Letter of Credit Application”). Borrower agrees to execute any further documentation in connection with the Letters of Credit as Bank may reasonably request. Borrower further agrees to be bound by the regulations and interpretations of the issuer of any Letters of Credit guarantied by Bank and opened for Borrower’s account or by Bank’s interpretations of any Letter of Credit issued by Bank for Borrower’s account, and Borrower understands and agrees that Bank shall not be liable for any error, negligence, or mistake, whether of omission or commission (other than those directly resulting from Bank’s gross negligence or willful misconduct), in following Borrower’s instructions or those contained in the Letters of Credit or any modifications, amendments, or supplements thereto.

3.

(c) The obligation of Borrower to immediately reimburse Bank for drawings made under Letters of Credit shall be absolute, unconditional, and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, such Letters of Credit, and the Letter of Credit Application.

2.1.4 Foreign Exchange Sublimit.

As part of the Revolving Line, Borrower may enter into foreign exchange contracts with Bank under which Borrower commits to purchase from or sell to Bank a specific amount of Foreign Currency (each, a “FX Forward Contract”) on a specified date (the “Settlement Date”). FX Forward Contracts shall have a Settlement Date of at least one (1) FX Business Day after the contract date and shall be subject to a reserve of ten percent (10%) of each outstanding FX Forward Contract (the “FX Reserve”). The aggregate amount of FX Forward Contracts at any one time may not exceed ten (10) times the lesser of (A) One Million Dollars ($1,000,000), minus (i) the sum of all amounts used for Cash Management Services, and minus (ii) the Dollar Equivalent of the face amount of any outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), or (B) the lesser of Revolving Line or the Borrowing Base, minus (i) the sum of all outstanding principal amounts of any Advances (including any amounts used for Cash Management Services), and minus (ii) the Dollar Equivalent of the face amount of any outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit). The amount otherwise available for Credit Extensions under the Revolving Line shall be reduced by an amount equal to ten percent (10%) of each outstanding FX Forward Contract (the “FX Reduction Amount”). Any amounts needed to fully reimburse Bank for any amounts not paid by Borrower in connection with FX Forward Contracts will be treated as Advances under the Revolving Line and will accrue interest at the interest rate applicable to Advances.

2.1.5 Cash Management Services Sublimit.

Borrower may use the Revolving Line for Bank’s cash management services, which may include merchant services, direct deposit of payroll, business credit card, and check cashing services identified in Bank’s various cash management services agreements (collectively, the “Cash Management Services”), in an aggregate amount not to exceed the lesser of (A) One Million Dollars ($1,000,000), minus (i) the Dollar Equivalent of the face amount of any outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), and minus (ii) the FX Reduction Amount, or (B) the lesser of Revolving Line or the Borrowing Base, minus (i) the sum of all outstanding principal amounts of any Advances, minus the Dollar Equivalent of the face amount of any outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), and minus (ii) the FX Reduction Amount. Any amounts Bank pays on behalf of Borrower for any Cash Management Services will be treated as Advances under the Revolving Line and will accrue interest at the interest rate applicable to Advances.

2.2 Overadvances.

If, at any time, the sum of (a) the outstanding principal amount of any Advances (including any amounts used for Cash Management Services), plus (b) the face amount of any outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), plus (c) the FX Reduction Amount (such sum being an “Overadvance”) exceeds the lesser of either the

4.

Revolving Line or the Borrowing Base, Borrower shall immediately pay to Bank in cash such Overadvance. Without limiting Borrower’s obligation to repay Bank any amount of the Overadvance, Borrower agrees to pay Bank interest on the outstanding amount of any Overadvance, on demand, at the Default Rate.

2.3 Payment of Interest on the Credit Extensions.

(a) Interest Rate.

(i) Growth Capital Advances. Subject to Section 2.3(b), the principal amount outstanding for each Growth Capital Advance shall accrue interest at a fixed per annum rate equal to the greater of either (A) the Prime Rate (fixed as of the Funding Date of each Growth Capital Advance), plus two percent (2.00%) or (B) six percent (6.00%), which interest shall be payable monthly in accordance with Section 2.3(f) below.

(ii) Advances. Subject to Section 2.3(b), the principal amount outstanding under the Revolving Line shall accrue interest at a floating per annum rate equal to the Prime Rate, plus one and one half of one percent (1.50%), which interest shall be payable monthly in accordance with Section 2.3(f) below.

(b) Default Rate. Immediately upon the occurrence and during the continuance of an Event of Default, Obligations shall bear interest at a rate per annum which is five percentage points (5.00%) above the rate that is otherwise applicable thereto (the “Default Rate”) unless Bank otherwise elects from time to time in its sole discretion to impose a smaller increase. Fees and expenses which are required to be paid by Borrower pursuant to the Loan Documents (including, without limitation, Bank Expenses) but are not paid when due shall bear interest until paid at a rate equal to the highest rate applicable to the Obligations. Payment or acceptance of the increased interest rate provided in this Section 2.3(b) is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of Bank.

(c) Adjustment to Interest Rate. Changes to the interest rate of any Credit Extension based on changes to the Prime Rate shall be effective on the effective date of any change to the Prime Rate and to the extent of any such change.

(d) Debit of Accounts. Bank may debit any of Borrower’s deposit accounts, including the Designated Deposit Account, for principal and interest payments or any other amounts Borrower owes Bank when due. These debits shall not constitute a set-off.

(e) Collections. Subject to the terms of Section 2.6(b), at all times that Borrower is not operating under a Streamline Period, Collections deposited into the Cash Collateral Account (or Lockbox, as applicable) will be credited on a daily basis, within three (3) days of receipt of such amounts by Bank, to the outstanding Obligations under the Revolving Line, but if there is an Event of Default, Bank may apply Collections to the Obligations in any order it chooses.

(f) Payment; Interest Computation. Interest is payable monthly on the last calendar day of each month and shall be computed on the basis of a 360-day year for the actual

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number of days elapsed. In computing interest, (i) all Payments received after 12:00 p.m. Pacific time on any day shall be deemed received at the opening of business on the next Business Day, and (ii) the date of the making of any Credit Extension shall be included and the date of payment shall be excluded; provided, however, that if any Credit Extension is repaid on the same day on which it is made, such day shall be included in computing interest on such Credit Extension. Bank shall not, however, be required to credit Borrower’s account for the amount of any item of payment which is unsatisfactory to Bank in its good faith business judgment, and Bank may charge Borrower’s Designated Deposit Account for the amount of any item of payment which is returned to Bank unpaid.

2.4 Fees.

Borrower shall pay to Bank:

(a) Commitment Fee. A fully earned, non-refundable commitment fee of Forty Thousand Dollars ($40,000) (the “Commitment Fee”), on the Effective Date;

(b) Good Faith Deposit. Borrower has paid to Bank a good faith deposit of Forty Thousand Dollars ($40,000) (the “Good Faith Deposit”) to initiate Bank’s due diligence review process. Any portion of the Good Faith Deposit not utilized to pay Bank Expenses, accrued on or before the Effective Date, will be applied to the Commitment Fee;

(c) Letter of Credit Fee. Bank’s customary fees and expenses for the issuance or renewal of Letters of Credit, upon the issuance of such Letter of Credit, each anniversary of the issuance during the term of such Letter of Credit, and upon the renewal of such Letter of Credit by Bank;

(d) Final Payment. The Final Payment, when due pursuant to the terms of Sections 2.1.1(c), 2.1.l(d) and 2.1.1(e); and

(e) Bank Expenses. All Bank Expenses (including reasonable attorneys’ fees and expenses for documentation and negotiation of this Agreement) incurred through and after the Effective Date, when due.

2.5 Payments.

All payments (including prepayments) to be made by Borrower under any Loan Document shall be made in immediately available funds in U.S. Dollars, without setoff or counterclaim, before 12:00 p.m. Pacific time on the date when due. Payments of principal and/or interest received after 12:00 p.m. Pacific time are considered received at the opening of business on the next Business Day. When a payment is due on a day that is not a Business Day, the payment shall be due the next Business Day, and additional fees or interest, as applicable, shall continue to accrue until paid.

2.6 Cash Collateral Account; Lockbox; Account Collection Services.

(a) Borrower shall direct each Account Debtor (and each depository institution where proceeds of Accounts are on deposit) to (i) remit payments (including, but

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limited to, check collections) with respect to the Accounts and (ii) wire transfer all automatic clearing house and wire payments with respect to the Accounts, to a cash collateral account that Bank controls (the “Cash Collateral Account”). It will be considered an immediate Event of Default if the Cash Collateral Account is not set-up and operational within five (5) days after the Effective Date. Notwithstanding the foregoing, as and when directed by Bank from time to time, at Bank’s option and at the sole and exclusive discretion of Bank (regardless of whether an Event of Default has occurred) and subject to Bank’s quarterly review of Borrower’s check collections, Borrower shall direct each Account Debtor (and each depository institution where proceeds of Accounts are on deposit) to remit all other checks and other payments with respect to the Accounts to a lockbox account established with Bank (the “Lockbox”). It will be considered an immediate Event of Default if the Lockbox is not set-up and operational within forty-five (45) days from the date of such direction by Bank.

(b) Until the Cash Collateral Account is established, the proceeds of the Accounts shall be paid by the Account Debtors to an address consented to by Bank. Upon receipt by Borrower of proceeds of the Accounts paid by the Account Debtors, Borrower shall immediately transfer and deliver same to Bank, along with a detailed cash receipts journal. Provided (i) no Event of Default exists or an event that with notice or lapse of time will be an Event of Default and (ii) during a Streamline Period, within three (3) days of receipt of such amounts by Bank, Bank will deposit into Borrower’s depository account with Bank or Bank’s Affiliates the proceeds of the Accounts. This Section does not impose any affirmative duty on Bank to perform any act other than as specifically set forth herein. All Accounts and the proceeds thereof are Collateral and if an Event of Default occurs, Bank may apply the proceeds of such Accounts to the Obligations.

3 CONDITIONS OF LOANS

3.1 Conditions Precedent to Initial Credit Extension.

Bank’s obligation to make the initial Credit Extension is subject to the condition precedent that Bank shall have received, in form and substance satisfactory to Bank, such documents, and completion of such other matters, as Bank may reasonably deem necessary or appropriate, including, without limitation:

(a) duly executed original signatures to the Loan Documents;

(b) duly executed original signatures to the Warrant;

(c) duly executed original signatures to the Control Agreement;

(d) duly executed original signatures to the Stock Pledge Agreement;

(e) undated and blank Stock Powers for shares of Bermuda Subsidiary;

(f) Borrower’s Operating Documents and a good standing certificate of Borrower certified by the Secretary of State of the State of Delaware as of a date no earlier than thirty (30) days prior to the Effective Date;

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(g) duly executed original signatures to the completed Borrowing Resolutions for Borrower;

(h) certified copies, dated as of a recent date, of financing statement searches, as Bank shall request, accompanied by written evidence (including any UCC termination statements) that the Liens indicated in any such financing statements either constitute Permitted Liens or have been or, in connection with the initial Credit Extension, will be terminated or released;

(i) the Perfection Certificate of Borrower, together with the duly executed original signature thereto;

(j) a copy of its Registration Rights Agreement/Investors’ Rights Agreement and any amendments thereto;

(k) evidence satisfactory to Bank that the insurance policies required by Section 6.7 hereof are in full force and effect, together with appropriate evidence showing lender loss payable and/or additional insured clauses or endorsements in favor of Bank; and

(l) payment of the fees and Bank Expenses then due as specified in Section 2.4 hereof.

3.2 Conditions Precedent to all Credit Extensions.

Bank’s obligations to make each Credit Extension, including the initial Credit Extension, is subject to the following conditions precedent:

(a) except as otherwise provided in Section 3.5, timely receipt of an executed Transaction Report or Payment/Advance Form;

(b) the representations and warranties in this Agreement shall be true, accurate, and complete in all material respects on the date of the Transaction Report or Payment/Advance Form and on the Funding Date of each Credit Extension; 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, and no Event of Default shall have occurred and be continuing or result from the Credit Extension. Each Credit Extension is Borrower’s representation and warranty on that date that the representations and warranties in this Agreement remain true, accurate, and complete in all material respects; 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; and

(c) in Bank’s sole discretion, there has not been a Material Adverse Change.

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3.3 Post-Closing Conditions.

Unless otherwise provided in writing, within forty-five (45) days after the Effective Date, Bank shall have received, in form and substance satisfactory to Bank, the original stock certificates of Bermuda Subsidiary.

3.4 Covenant to Deliver.

Except as otherwise provided in Section 3.3, Borrower agrees to deliver to Bank each item required to be delivered to Bank under this Agreement as a condition precedent to any Credit Extension. Borrower expressly agrees that a Credit Extension made prior to the receipt by Bank of any such item shall not constitute a waiver by Bank of Borrower’s obligation to deliver such item, and the making of any Credit Extension in the absence of a required item shall be in Bank’s sole discretion.

3.5 Procedures for Borrowing.

(a) Growth Capital Advances. Subject to the prior satisfaction of all other applicable conditions to the making of a Growth Capital Advance set forth in this Agreement, to obtain a Growth Capital Advance, Borrower shall notify Bank (which notice shall be irrevocable) by electronic mail, facsimile, or telephone by 12:00 p.m. Pacific time on the Funding Date of the Growth Capital Advance. Together with such notification, Borrower must promptly deliver to Bank by electronic mail or facsimile a completed Payment/Advance Form executed by a Responsible Officer or his or her designee. Bank shall credit Growth Capital Advances to the Designated Deposit Account. Bank may make Growth Capital Advances under this Agreement based on instructions from a Responsible Officer or his or her designee or without instructions if the Growth Capital Advances are necessary to meet Obligations which have become due. Bank may rely on any telephone notice given by a person whom Bank believes is a Responsible Officer or designee.

(b) Advances. Subject to the prior satisfaction of all other applicable conditions to the making of an Advance set forth in this Agreement, to obtain an Advance (other than Advances under Sections 2.1.3 or 2.1.5), Borrower shall notify Bank (which notice shall be irrevocable) by electronic mail, facsimile, or telephone by 12:00 p.m. Pacific time on the Funding Date of the Advance. Together with such notification, Borrower must promptly deliver to Bank by electronic mail or facsimile a completed Transaction Report executed by a Responsible Officer or his or her designee. Bank shall credit Advances to the Designated Deposit Account. Bank may make Advances under this Agreement based on instructions from a Responsible Officer or his or her designee or without instructions if the Advances are necessary to meet Obligations which have become due. Bank may rely on any telephone notice given by a person whom Bank believes is a Responsible Officer or designee.

4 CREATION OF SECURITY INTEREST

4.1 Grant of Security Interest.

Borrower hereby grants Bank, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Bank, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and products thereof.

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4.2 Priority of Security Interest.

Borrower represents, warrants, and covenants that the security interest granted herein is and shall at all times continue to be a first priority perfected security interest in the Collateral (subject only to Permitted Liens that may have superior priority to Bank’s Lien under this Agreement). If Borrower shall acquire a commercial tort claim, Borrower shall promptly notify Bank in a writing signed by Borrower of the general details thereof and grant to Bank in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to Bank.

If this Agreement is terminated, Bank’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations and any of Borrower’s obligations arising from the Warrant) are repaid in full in cash. Upon payment in full in cash of the Obligations (other than inchoate indemnity obligations and any of Borrower’s obligations arising from the Warrant) and at such time as Bank’s obligation to make Credit Extensions has terminated, Bank shall, at Borrower’s sole cost and expense, release its Liens in the Collateral and all rights therein shall revert to Borrower.

4.3 Authorization to File Financing Statements.

Borrower hereby authorizes Bank to file financing statements, without notice to Borrower, with all appropriate jurisdictions to perfect or protect Bank’s interest or rights hereunder, including a notice that any disposition of the Collateral, by either Borrower or any other Person, shall be deemed to violate the rights of Bank under the Code. Any such financing statements may indicate the Collateral as is as set forth on Exhibit A hereto.

5 REPRESENTATIONS AND WARRANTIES

Borrower represents and warrants as follows:

5.1 Due Organization, Authorization; Power and Authority.

Borrower is duly existing and in good standing as a Registered Organization in its jurisdiction of formation and is qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of its business or its ownership of property requires that it be qualified except where the failure to do so could not reasonably be expected to have a material adverse effect on Borrower’s business. In connection with this Agreement, Borrower has delivered to Bank a completed certificate signed by Borrower, entitled “Perfection Certificate”. Borrower represents and warrants to Bank that (a) Borrower’s exact legal name is that indicated on the Perfection Certificate and on the signature page hereof; (b) Borrower is an organization of the type and is organized in the jurisdiction set forth in the Perfection Certificate; (c) the Perfection Certificate accurately sets forth Borrower’s organizational identification number or accurately states that Borrower has none; (d) the Perfection Certificate accurately sets forth Borrower’s place of business, or, if more than one, its chief executive office as well as Borrower’s mailing address (if different than its chief executive office); (e) Borrower (and each

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of its predecessors) has not, in the past five (5) years, changed its jurisdiction of formation, organizational structure or type, or any organizational number assigned by its jurisdiction; and (f) all other information set forth on the Perfection Certificate pertaining to Borrower and each of its Subsidiaries is accurate and complete (it being understood and agreed that Borrower may from time to time update certain information in the Perfection Certificate after the Effective Date to the extent permitted by one or more specific provisions in this Agreement). If Borrower is not now a Registered Organization but later becomes one, Borrower shall promptly notify Bank of such occurrence and provide Bank with Borrower’s organizational identification number.

The execution, delivery and performance by Borrower of the Loan Documents to which it is a party have been duly authorized, and do not (i) conflict with any of Borrower’s organizational documents, (ii) contravene, conflict with, constitute a default under or violate any material Requirement of Law, (iii) contravene, conflict or violate any applicable order, writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or any of its Subsidiaries or any of their property or assets may be bound or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full force and effect) or (v) constitute an event of default under any material agreement by which Borrower is bound. Borrower is not in default under any agreement to which it is a party or by which it is bound in which the default could reasonably be expected to have a material adverse effect on Borrower’s business.

5.2 Collateral.

Borrower has good title to, has rights in, and the power to transfer each item of the Collateral upon which it purports to grant a Lien hereunder, free and clear of any and all Liens except Permitted Liens. Borrower has no deposit accounts other than the deposit accounts with Bank, the deposit accounts, if any, described in the Perfection Certificate delivered to Bank in connection herewith, or of which Borrower has given Bank notice and taken such actions as are necessary to give Bank a perfected security interest therein. The Accounts are bona fide, existing obligations of the Account Debtors.

The Collateral is not in the possession of any third party bailee (such as a warehouse) except as otherwise provided in the Perfection Certificate. None of the components of the Collateral shall be maintained at locations other than as provided in the Perfection Certificate or as permitted pursuant to Section 7.2.

All Inventory is in all material respects of good and marketable quality, free from material defects.

Borrower and each Subsidiary of Borrower is the sole owner of the Intellectual Property which it owns or purports to own except for (a) non-exclusive licenses granted to its customers in the ordinary course of business, (b) over-the-counter software that is commercially available to the public, and (c) material Intellectual Property licensed to Borrower and its Subsidiaries and noted on the Perfection Certificate. Each Patent which Borrower and each Subsidiary owns or purports to own and which is material to Borrower’s or any Subsidiary’s business is valid and enforceable, and no part of the Intellectual Property which Borrower or any Subsidiary owns or

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purports to own and which is material to Borrower’s or any Subsidiary’s business has been judged invalid or unenforceable, in whole or in part. To the best of Borrower’s knowledge, no claim has been made that any part of the Intellectual Property violates the rights of any third party except to the extent such claim would not reasonably be expected to have a material adverse effect on Borrower’s or any Subsidiary’s business. Except as noted on the Perfection Certificate, Borrower and its Subsidiaries are not a party to, nor are bound by, any Restricted License.

5.3 Accounts Receivable.

(a) For each Account with respect to which Advances are requested, on the date each Advance is requested and made, such Account shall be an Eligible Account.

(b) All statements made and all unpaid balances appearing in all invoices, instruments and other documents evidencing the Eligible Accounts are and shall be true and correct and all such invoices, instruments and other documents, and all of Borrower’s Books are genuine and in all respects what they purport to be. Whether or not an Event of Default has occurred and is continuing, Bank may notify any Account Debtor owing Borrower money of Bank’s security interest in such funds and verify the amount of such Eligible Account. All sales and other transactions underlying or giving rise to each Eligible Account shall comply in all material respects with all applicable laws and governmental rules and regulations. Borrower has no knowledge of any actual or imminent Insolvency Proceeding of any Account Debtor whose accounts are Eligible Accounts in any Transaction Report. To the best of Borrower’s knowledge, all signatures and endorsements on all documents, instruments, and agreements relating to all Eligible Accounts are genuine, and all such documents, instruments and agreements are legally enforceable in accordance with their terms.

5.4 Litigation.

There are no actions or proceedings pending or, to the knowledge of the Responsible Officers, threatened in writing by or against Borrower or any of its Subsidiaries involving more than One Hundred Thousand Dollars ($100,000), individually or in the aggregate, One Hundred Thousand Dollars ($100,000).

5.5 Financial Statements; Financial Condition.

All consolidated financial statements for Borrower and any of its Subsidiaries delivered to Bank fairly present in all material respects Borrower’s consolidated financial condition and Borrower’s consolidated results of operations. There has not been any material deterioration in Borrower’s consolidated financial condition since the date of the most recent financial statements submitted to Bank.

5.6 Solvency.

The fair salable value of Borrower’s assets (including goodwill minus disposition costs) exceeds the fair value of its liabilities; Borrower is not left with unreasonably small capital after the transactions in this Agreement; and Borrower is able to pay its debts (including trade debts) as they mature.

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5.7 Regulatory Compliance.

Borrower is not an “investment company” or a company “controlled” by an “investment company” under the Investment Company Act of 1940, as amended. Borrower is not engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors). Borrower has complied in all material respects with the Federal Fair Labor Standards Act. Neither Borrower nor any of its Subsidiaries is a “holding company” or an “affiliate” of a “holding company” or a “subsidiary company” of a “holding company” as each term is defined and used in the Public Utility Holding Company Act of 2005. Borrower has not violated any laws, ordinances or rules, the violation of which could reasonably be expected to have a material adverse effect on its business. None of Borrower’s or any of its Subsidiaries’ properties or assets has been used by Borrower or any Subsidiary or, to the best of Borrower’s knowledge, by previous Persons, in disposing, producing, storing, treating, or transporting any hazardous substance other than legally. Borrower and each of its Subsidiaries have obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all Governmental Authorities that are necessary to continue their respective businesses as currently conducted.

5.8 Subsidiaries; Investments.

Borrower does not own any stock, partnership interest or other equity securities except for Permitted Investments.

5.9 Tax Returns and Payments; Pension Contributions.

Borrower 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. Borrower may defer payment of any contested taxes, provided that Borrower (a) in good faith contests its obligation to pay the taxes by appropriate proceedings promptly and diligently instituted and conducted, (b) notifies Bank in writing of the commencement of, and any material development in, the proceedings, (c) posts bonds or takes any other steps required to prevent the Governmental Authority levying such contested taxes from obtaining a Lien upon any of the Collateral that is other than a “Permitted Lien”. Borrower is unaware of any claims or adjustments proposed for any of Borrower’s prior tax years which could result in additional taxes becoming due and payable by Borrower. Borrower has paid all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms, and Borrower has not withdrawn from participation in, and has not permitted partial or complete termination of, or permitted the occurrence of any other event with respect to, any such plan which could reasonably be expected to result in any liability of Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other governmental agency.

5.10 Use of Proceeds.

Borrower shall use the proceeds of the Credit Extensions solely as working capital and to fund its general business requirements and not for personal, family, household or agricultural purposes; provided, however, notwithstanding the foregoing, the proceeds of the Tranche B Advances shall be used solely for financing Eligible Purchase Orders.

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5.11 Full Disclosure.

No written representation, warranty or other statement of Borrower in any certificate or written statement given to Bank, as of the date such representation, warranty, or other statement was made, taken together with all such written certificates and written statements given to Bank, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the certificates or statements not misleading (it being recognized by Bank that the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results).

5.12 Definition of “Knowledge.”

For purposes of the Loan Documents, whenever a representation or warranty is made to Borrower’s knowledge or awareness, to the “best of” Borrower’s knowledge, or with a similar qualification, knowledge or awareness means the actual knowledge, after reasonable investigation, of the Responsible Officers.

6 AFFIRMATIVE COVENANTS

Borrower shall do all of the following:

6.1 Government Compliance.

(a) Maintain its and all its Subsidiaries’ legal existence and good standing in their respective jurisdictions of formation and maintain qualification in each jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on Borrower’s business or operations. Borrower shall comply, and have each Subsidiary comply, with all laws, ordinances and regulations to which it is subject, noncompliance with which could reasonably expected to have a material adverse effect on Borrower’s business.

(b) Use commercially reasonable efforts to obtain all of the Governmental Approvals necessary for the performance by Borrower of its obligations under the Loan Documents to which it is a party and the grant of a security interest to Bank in all of its property. Borrower shall promptly provide copies of any such obtained Governmental Approvals to Bank.

6.2 Financial Statements, Reports, Certificates.

Provide Bank with the following:

(a) at all times that any Advances are outstanding, a Transaction Report (and any schedules related thereto) each week; provided, however, that during a Streamline Period, provided no Event of Default has occurred and is continuing, such Transaction Report (and any schedules related thereto) shall be required to be provided to Bank within thirty (30) days after the last day of each month, rather than on a weekly basis;

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(b) within thirty (30) days after the end of each month, (A) monthly accounts receivable agings, aged by invoice date, (B) monthly accounts payable agings, aged by invoice date, and outstanding or held check registers, if any, and (C) monthly reconciliations of accounts receivable agings (aged by invoice date), transaction reports and general ledger;

(c) as soon as available, but no later than thirty (30) days after the last day of each month, a company prepared consolidating balance sheet and income statement covering Borrower’s and each of its Subsidiary’s operations for such month certified by a Responsible Officer and in a form acceptable to Bank (the “Monthly Financial Statements”);

(d) within thirty (30) days after the last day of each month and together with the Monthly Financial Statements, a duly completed Compliance Certificate signed by a Responsible Officer, certifying that as of the end of such month, Borrower was in full compliance with all of the terms and conditions of this Agreement, and setting forth calculations showing compliance with the financial covenants set forth in this Agreement and such other information as Bank shall reasonably request, including, without limitation, a statement that at the end of such month there were no held checks;

(e) within thirty (30) days after the last day of each month, a consolidated statement of the cash balances maintained in each Foreign Deposit Account;

(f) within ten (10) days of approval by the Board of Directors of Borrower, (A) annual operating budgets (including income statements, balance sheets and cash flow statements, by month) for the upcoming fiscal year of Borrower, and (B) annual financial projections for the following fiscal year (on a quarterly basis) as approved by Borrower’s board of directors;

(g) as soon as available, and in any event within one hundred eighty (180) days following the end of Borrower’s fiscal year, audited consolidating financial statements prepared under GAAP, consistently applied, together with an unqualified opinion on the financial statements from an independent certified public accounting firm acceptable to Bank in its reasonable discretion;

(h) as soon as available, but no later than thirty (30) days following the end of Borrower’s fiscal year, company prepared consolidating financial statements covering Borrower’s and each of its Subsidiary’s operations for such fiscal year certified by a Responsible Officer and in a form acceptable to Bank;

(i) in the event that Borrower becomes subject to the reporting requirements under the Exchange Act within five (5) days of filing, copies of all periodic and other reports, proxy statements and other materials filed by Borrower with the SEC, any Governmental Authority succeeding to any or all of the functions of the SEC or with any national securities exchange, or distributed to its shareholders, as the case may be. Documents required to be delivered pursuant to the terms hereof (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which Borrower posts such documents, or provides a link thereto, on Borrower’s website on the Internet at Borrower’s website address;

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(j) within five (5) days of delivery, copies of all statements, reports and notices made generally available to Borrower’s security holders or to any holders of Subordinated Debt;

(k) prompt report of any legal actions pending or threatened in writing against Borrower or any of its Subsidiaries that could result in damages or costs to Borrower or any of its Subsidiaries of, individually or in the aggregate, One Hundred Thousand Dollars ($100,000) or more; and

(l) other financial information reasonably requested by Bank.

6.3 Accounts Receivable.

(a) Schedules and Documents Relating to Accounts. Borrower shall deliver to Bank transaction reports and schedules of collections, as provided in Section 6.2, on Bank’s standard forms; provided, however, that Borrower’s failure to execute and deliver the same shall not affect or limit Bank’s Lien and other rights in all of Borrower’s Accounts, nor shall Bank’s failure to advance or lend against a specific Account affect or limit Bank’s Lien and other rights therein. If requested by Bank, Borrower shall furnish Bank with copies (or, at Bank’s request, originals) of all contracts, orders, invoices, and other similar documents, and all shipping instructions, delivery receipts, bills of lading, and other evidence of delivery, for any goods the sale or disposition of which gave rise to such Accounts. In addition, Borrower shall deliver to Bank, on its request, the originals of all instruments, chattel paper, security agreements, guarantees and other documents and property evidencing or securing any Accounts, in the same form as received, with all necessary indorsements, and copies of all credit memos.

(b) Disputes. Borrower shall promptly notify Bank of all disputes or claims relating to Accounts. Borrower may forgive (completely or partially), compromise, or settle any Account for less than payment in full, or agree to do any of the foregoing so long as (i) Borrower does so in good faith, in a commercially reasonable manner, in the ordinary course of business, in arm’s-length transactions, and reports the same to Bank in the regular reports provided to Bank; (ii) no Event of Default has occurred and is continuing; and (iii) after taking into account all such discounts, settlements and forgiveness, the total outstanding Advances will not exceed the lesser of the Revolving Line or the Aggregate Borrowing Base.

(c) Collection of Accounts. Borrower shall have the right to collect all Accounts, unless and until an Event of Default has occurred and is continuing. Bank may, in its good faith business judgment, require that all proceeds of Accounts be deposited by Borrower into a lockbox account, or such other “blocked account” as specified by Bank, pursuant to a blocked account agreement in such form as Bank may specify in its good faith business judgment. Whether or not an Event of Default has occurred and is continuing, Borrower shall immediately deliver all payments on and proceeds of Accounts to an account maintained with Bank to be applied (i) prior to an Event of Default, pursuant to the terms of Sections 2.3(e) and 2.6 hereof, and (ii) after the occurrence and during the continuance of an Event of Default, pursuant to the terms of Section 9.4 hereof.

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(d) Returns. Provided no Event of Default has occurred and is continuing, if any Account Debtor returns any Inventory to Borrower with a value in excess of Two Hundred Fifty Thousand Dollars ($250,000), Borrower shall promptly (i) determine the reason for such return, (ii) issue a credit memorandum to the Account Debtor in the appropriate amount, and (iii) provide a copy of such credit memorandum to Bank, upon request from Bank. In the event any attempted return occurs after the occurrence and during the continuance of any Event of Default, Borrower shall immediately notify Bank of the return of the Inventory.

(e) Verification. Bank may, from time to time, verify directly with the respective Account Debtors the validity, amount and other matters relating to the Accounts, either in the name of Borrower or Bank or such other name as Bank may choose.

(f) No Liability. Bank shall not be responsible or liable for any shortage or discrepancy in, damage to, or loss or destruction of, any goods, the sale or other disposition of which gives rise to an Account, or for any error, act, omission, or delay of any kind occurring in the settlement, failure to settle, collection or failure to collect any Account, or for settling any Account in good faith for less than the full amount thereof, nor shall Bank be deemed to be responsible for any of Borrower’s obligations under any contract or agreement giving rise to an Account. Nothing herein shall, however, relieve Bank from liability for its own gross negligence or willful misconduct.

6.4 Remittance of Proceeds.

Except as otherwise provided in Section 6.3(c), deliver, in kind, all proceeds arising from the disposition of any Collateral to Bank in the original form in which received by Borrower not later than the following Business Day after receipt by Borrower, to be applied to the Obligations (1) prior to an Event of Default, pursuant to the terms of Sections 2.3(e) and 2.6 hereof, and (2) after the occurrence and during the continuance of an Event of Default, pursuant to the terms of Section 9.4 hereof; provided that, if no Event of Default has occurred and is continuing, Borrower shall not be obligated to remit to Bank the proceeds of the sale of surplus, worn out or obsolete Equipment disposed of by Borrower in good faith in an arm’s length transaction for an aggregate purchase price of Two Hundred Thousand Dollars ($200,000) or less (for all such transactions in any fiscal year). Borrower agrees that it will maintain all proceeds of Collateral in an account maintained with Bank. Nothing in this Section limits the restrictions on disposition of Collateral set forth elsewhere in this Agreement.

6.5 Taxes; Pensions.

Timely file, and require each of its Subsidiaries to timely file, all required tax returns and reports and timely pay, and require each of its Subsidiaries to timely pay, all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower and each of its Subsidiaries, except for deferred payment of any taxes contested pursuant to the terms of Section 5.9 hereof, and shall deliver to Bank, on demand, appropriate certificates attesting to such payments, and pay all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms.

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6.6 Access to Collateral; Books and Records.

At reasonable times, on three (3) Business Days’ notice (provided no notice is required if an Event of Default has occurred and is continuing), Bank, or its agents, shall have the right to inspect the Collateral and the right to audit and copy Borrower’s Books. Provided no Event of Default has occurred and is continuing, such audits shall be conducted no more than once every twelve (12) months. Borrower hereby acknowledges that the Initial Audit will be conducted within sixty (60) days prior to the initial Advance. The foregoing inspections and audits shall be at Borrower’s expense, and the charge therefor shall be Eight Hundred Fifty Dollars ($850) per person per day (or such higher amount as shall represent Bank’s then-current standard charge for the same), plus reasonable out-of-pocket expenses. In the event Borrower and Bank schedule an audit more than ten (10) days in advance, and Borrower cancels or seeks to reschedules the audit with less than ten (10) days written notice to Bank, then (without limiting any of Bank’s rights or remedies), Borrower shall pay Bank a fee of One Thousand Dollars ($1,000) plus any out-of-pocket expenses incurred by Bank to compensate Bank for the anticipated costs and expenses of the cancellation or rescheduling.

6.7 Insurance.

Keep its business and the Collateral insured for risks and in amounts standard for companies in Borrower’s industry and location and as Bank may reasonably request. Insurance policies shall be in a form, with companies, and in amounts that are satisfactory to Bank. All property policies shall have a lender’s loss payable endorsement showing Bank as an additional lender loss payee and waive subrogation against Bank. All liability policies shall show, or have endorsements showing, Bank as an additional insured. All policies (or the loss payable and additional insured endorsements) shall provide that the insurer shall give Bank at least twenty (20) days notice before canceling, amending, or declining to renew its policy. At Bank’s request, Borrower shall deliver certified copies of policies and evidence of all premium payments. Proceeds payable under any property policy shall, at Bank’s option, be payable to Bank on account of the Obligations. Notwithstanding the foregoing, (a) so long as no Event of Default has occurred and is continuing, Borrower shall have the option of applying the proceeds of any casualty policy up to Fifty Thousand Dollars ($50,000) with respect to any loss, but not exceeding Two Hundred Thousand Dollars ($200,000) in the aggregate for all losses under all casualty policies in any one year, toward the replacement or repair of destroyed or damaged property; provided that any such replaced or repaired property (i) shall be of equal or like value as the replaced or repaired Collateral and (ii) shall be deemed Collateral in which Bank has been granted a first priority security interest, and (b) after the occurrence and during the continuance of an Event of Default, all proceeds payable under such casualty policy shall, at the option of Bank, be payable to Bank on account of the Obligations. If Borrower fails to obtain insurance as required under this Section 6.7 or to pay any amount or furnish any required proof of payment to third persons and Bank, Bank may make all or part of such payment or obtain such insurance policies required in this Section 6.7, and take any action under the policies Bank deems prudent.

6.8 Operating Accounts.

(a) Maintain all of its and all of its Subsidiaries’ primary operating and investment accounts with Bank and Bank’s Affiliates except for its foreign deposit accounts with

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the banks or financial institutions listed on the Perfection Certificate (individually, a “Foreign Deposit Account”, and collectively, the “Foreign Deposit Accounts”); provided, that the Foreign Deposit Accounts shall not contain deposits having a value of more than Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate at any time, except for the Foreign Deposit Accounts of Borrower’s Malaysia Subsidiary, which Malaysia Subsidiary may maintain an average monthly balance of deposits, tested as of the last day of each month, having a value not to exceed Three Hundred Thousand Dollars ($300,000). Notwithstanding the foregoing, Borrower may maintain its primary operating accounts at Comerica Bank (the “Comerica Bank Accounts”) without executing and delivering Control Agreements with respect to such accounts, provided that Borrower shall close all Comerica Bank Accounts and transfer all funds in the Comerica Bank Accounts to Bank and Bank’s Affiliates not later than sixty (60) days after the Effective Date.

(b) Provide Bank five (5) days prior written notice before establishing any Collateral Account at or with any bank or financial institution other than Bank or Bank’s Affiliates. For each Collateral Account that Borrower at any time maintains, Borrower shall cause the applicable bank or financial institution (other than Bank) at or with which any Collateral Account is maintained to execute and deliver a Control Agreement or other appropriate instrument with respect to such Collateral Account to perfect Bank’s Lien in such Collateral Account in accordance with the terms hereunder which Control Agreement may not be terminated without the prior written consent of Bank. The provisions of the previous sentence shall not apply to deposit accounts exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of Borrower’s employees and identified to Bank by Borrower as such.

6.9 Protection of Intellectual Property Rights.

(a) (i) Use commercially reasonable efforts to protect, defend and maintain the validity and enforceability of its Intellectual Property and each of its Subsidiary’s Intellectual Property; (ii) promptly advise Bank in writing of material infringements of its Intellectual Property and each of its Subsidiary’s Intellectual Property; and (iii) not allow any Intellectual Property material to Borrower’s or any Subsidiary’s business to be abandoned, forfeited or dedicated to the public without Bank’s written consent.

(b) Provide written notice to Bank within thirty (30) days of entering or becoming bound by any Restricted License (other than over-the-counter software that is commercially available to the public). Borrower shall take such steps as Bank requests to obtain the consent of, or waiver by, any person whose consent or waiver is necessary for (i) any Restricted License to be deemed “Collateral” and for Bank to have a security interest in it that might otherwise be restricted or prohibited by law or by the terms of any such Restricted License, whether now existing or entered into in the future, and (ii) Bank to have the ability in the event of a liquidation of any Collateral to dispose of such Collateral in accordance with Bank’s rights and remedies under this Agreement and the other Loan Documents.

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6.10 Litigation Cooperation.

From the date hereof and continuing through the termination of this Agreement, make available to Bank, without expense to Bank, Borrower and its officers, employees and agents and Borrower’s books and records, to the extent that Bank may deem them reasonably necessary to prosecute or defend any third-party suit or proceeding instituted by or against Bank with respect to any Collateral or relating to Borrower; provided however, that any information provided to Bank shall be subject to the confidentiality provisions set forth in Section 12.10 herein, and Borrower shall not be required to disclose any information that is of a highly confidential nature or otherwise subject to attorney-client privilege.

6.11 Further Assurances.

Execute any further instruments and take further action as Bank reasonably requests to perfect or continue Bank’s Lien in the Collateral or to effect the purposes of this Agreement. Deliver to Bank, within five (5) days after the same are sent or received, copies of all correspondence, reports, documents and other filings with any Governmental Authority regarding compliance with or maintenance of Governmental Approvals or Requirements of Law or that could reasonably be expected to have a material effect on any of the Governmental Approvals or otherwise on the operations of Borrower or any of its Subsidiaries.

7 NEGATIVE COVENANTS

Borrower shall not do any of the following without Bank’s prior written consent:

7.1 Dispositions.

Convey, sell, lease, transfer, assign, or otherwise dispose of (collectively, “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, except for Transfers (a) of Inventory in the ordinary course of business; (b) of worn-out or obsolete Equipment; and (c) in connection with Permitted Liens and Permitted Investments; (d) of non-exclusive licenses for the use of the property of Borrower or its Subsidiaries in the ordinary course of business; and (e) of property, valued in amount not to exceed Two Hundred Thousand Dollars ($200,000) in the aggregate in any fiscal year, to Borrower’s Subsidiaries consistent with past practices of Borrower and solely within the ordinary course of Borrower’s business.

7.2 Changes in Business, Management, Ownership, or Business Locations.

(a) Engage in or permit any of its Subsidiaries to engage in any business other than the businesses currently engaged in by Borrower and such Subsidiary, as applicable, or reasonably related thereto; (b) liquidate or dissolve; or (c) (i) any Responsible Officer ceases to hold such office with Borrower and a replacement satisfactory to Borrower’s Board of Directors is not made within thirty (30) days after his departure from Borrower; or (ii) enter into any transaction or series of related transactions in which the stockholders of Borrower who were not stockholders immediately prior to the first such transaction own more than forty-nine percent (49%) of the voting stock of Borrower immediately after giving effect to such transaction or related series of such transactions (other than by the sale of Borrower’s equity securities in a public offering or to venture capital investors so long as Borrower identifies to Bank the venture capital investors prior to the closing of the transaction and provides to Bank a description of the material terms of the transaction).

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Borrower shall not, without at least twenty (20) days prior written notice to Bank: (1) add any new offices or business locations, including warehouses (unless such new offices or business locations contain less than Fifty Thousand Dollars ($50,000) in Borrower’s assets or property) or deliver any portion of the Collateral valued, individually or in the aggregate, in excess of Fifty Thousand Dollars ($50,000) to a bailee at a location other than to a bailee and at a location already disclosed in the Perfection Certificate, (2) change its jurisdiction of organization, (3) change its organizational structure or type, (4) change its legal name, or (5) change any organizational number (if any) assigned by its jurisdiction of organization. If Borrower intends to deliver any portion of the Collateral valued, individually or in the aggregate, in excess of Fifty Thousand Dollars ($50,000) to a bailee, and Bank and such bailee are not already parties to a bailee agreement governing both the Collateral and the location to which Borrower intends to deliver the Collateral, then Borrower will first receive the written consent of Bank, and such bailee shall execute and deliver a bailee agreement in form and substance satisfactory to Bank in its sole discretion.

7.3 Mergers or Acquisitions.

Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any other Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of another Person. A Subsidiary may merge or consolidate into another Subsidiary or into Borrower; provided, however, only advance written notice to Bank (but not any consent from Bank) will be required for any of the restricted actions in this Section 7.3 if (i) all Obligations are being repaid in full as a condition to consummation of such action, and (ii) Bank has no further obligation hereunder to make any further Advances or Growth Capital Advances.

7.4 Indebtedness.

Create, incur, assume, or be liable for any Indebtedness, or permit any Subsidiary to do so, other than Permitted Indebtedness.

7.5 Encumbrance.

Create, incur, allow, or suffer any Lien on any of its property, or assign or convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, except for Permitted Liens, permit any Collateral not to be subject to the first priority security interest granted herein, or enter into any agreement, document, instrument or other arrangement (except with or in favor of Bank) with any Person which directly or indirectly prohibits or has the effect of prohibiting Borrower or any Subsidiary from assigning, mortgaging, pledging, granting a security interest in or upon, or encumbering any of Borrower’s or any Subsidiary’s Intellectual Property, except as is otherwise permitted in Section 7.1 hereof and the definition of “Permitted Liens” herein.

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7.6 Maintenance of Collateral Accounts.

Maintain any Collateral Account except pursuant to the terms of Section 6.8(b) hereof.

7.7 Distributions; Investments.

(a) Pay any dividends or make any distribution or payment or redeem, retire or purchase any capital stock per fiscal year; provided that (i) Borrower may convert any of its convertible securities into other securities pursuant to the terms of such convertible securities or otherwise in exchange thereof, (ii) Borrower may pay dividends solely in common stock; and (iii) Borrower may repurchase the stock of former employees or consultants pursuant to stock repurchase agreements so long as an Event of Default does not exist at the time of such repurchase and would not exist after giving effect to such repurchase, provided such repurchase does not exceed in the aggregate of One Hundred Fifty Thousand Dollars ($150,000) per fiscal year; or (b) directly or indirectly make any Investment other than Permitted Investments, or permit any of its Subsidiaries to do so.

7.8 Transactions with Affiliates.

Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower, except for (a) sales of equity securities to existing investors and (b) transactions that are in the ordinary course of Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm’s length transaction with a non-affiliated Person.

7.9 Subordinated Debt.

(a) Make or permit any payment on any Subordinated Debt, except under the terms of the subordination, intercreditor, or other similar agreement to which such Subordinated Debt is subject, or (b) amend any provision in any document relating to the Subordinated Debt which would increase the amount thereof or adversely affect the subordination thereof to Obligations owed to Bank.

7.10 Compliance.

Become an “investment company” or a company controlled by an “investment company”, under the Investment Company Act of 1940, as amended, or undertake as one of its important activities extending credit to purchase or carry margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System), or use the proceeds of any Credit Extension for that purpose; fail to meet the minimum funding requirements of ERISA, permit a Reportable Event or Prohibited Transaction, as defined in ERISA, to occur; fail to comply with the Federal Fair Labor Standards Act or violate any other law or regulation, if the violation could reasonably be expected to have a material adverse effect on Borrower’s business, or permit any of its Subsidiaries to do so; withdraw or permit any Subsidiary to withdraw from participation in, permit partial or complete termination of, or permit the occurrence of any other event with respect to, any present pension, profit sharing and deferred compensation plan which could reasonably be expected to result in any liability of Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other governmental agency.

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8 EVENTS OF DEFAULT

Any one of the following shall constitute an event of default (an “Event of Default”) under this Agreement:

8.1 Payment Default.

Borrower fails to (a) make any payment of principal or interest on any Credit Extension on its due date, or (b) pay any other Obligations within three (3) Business Days after such Obligations are due and payable (which three (3) Business Day cure period shall not apply to payments due on the Revolving Line Maturity Date). During the cure period, the failure to make or pay any payment specified under clause (a) or (b) hereunder is not an Event of Default (but no Credit Extension will be made during the cure period);

8.2 Covenant Default.

(a) Borrower fails or neglects to perform any obligation in Sections 6.2, 6.5, 6.6, 6.7, 6.8, 6.9(b), or violates any covenant in Section 7; or

(b) Borrower fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or agreement contained in this Agreement or any Loan Documents, and as to any default (other than those specified in this Section 8) under such other term, provision, condition, covenant or agreement that can be cured, has failed to cure the default within ten (10) days after the occurrence thereof; provided, however, that if the default cannot by its nature be cured within the ten (10) day period or cannot after diligent attempts by Borrower be cured within such ten (10) day period, and such default is likely to be cured within a reasonable time, then Borrower shall have an additional period (which shall not in any case exceed thirty (30) days) to attempt to cure such default, and within such reasonable time period the failure to cure the default shall not be deemed an Event of Default (but no Credit Extensions shall be made during such cure period). Cure periods provided under this section shall not apply, among other things, to financial covenants or any other covenants set forth in clause (a) above;

8.3 Continued Investor Support.

Bank determines in its good faith judgment that it is the clear intention of Borrower’s investors to not continue to fund the Borrower in the amounts and timeframe necessary to enable Borrower to satisfy the Obligations as they become due and payable;

8.4 Priority of Bank’s Security Interest.

There is a material impairment in the perfection or priority of the Bank’s security interest in the Collateral;

8.5 Attachment; Levy; Restraint on Business.

(a) (i) The service of process seeking to attach, by trustee or similar process, any funds of Borrower or of any entity under the control of Borrower (including a Subsidiary) on deposit or otherwise maintained with Bank or any Bank Affiliate, or (ii) a notice of lien or levy is

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filed against any of Borrower’s assets by any government agency, and the same under subclauses (i) and (ii) hereof are not, within ten (10) days after the occurrence thereof, discharged or stayed (whether through the posting of a bond or otherwise); provided, however, no Credit Extensions shall be made during any ten (10) day cure period; or

(b) (i) any material portion of Borrower’s assets is attached, seized, levied on, or comes into possession of a trustee or receiver, or (ii) any court order enjoins, restrains, or prevents Borrower from conducting any material part of its business;

8.6 Insolvency.

(a) Borrower is unable to pay its debts (including trade debts) as they become due or otherwise becomes insolvent; (b) Borrower begins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against Borrower and not dismissed or stayed within forty-five (45) days (but no Credit Extensions shall be made while of any of the conditions described in clause (a) exist and/or until any Insolvency Proceeding is dismissed);

8.7 Other Agreements.

There is, under any agreement to which Borrower is a party with a third party or parties, (a) any default resulting in a right by such third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an amount individually or in the aggregate in excess of One Hundred Thousand Dollars ($100,000); or (b) any default by Borrower or guarantor, the result of which could have a material adverse effect on Borrower’s business;

8.8 Judgments.

One or more final judgments, orders, or decrees for the payment of money in an amount, individually or in the aggregate, of at least One Hundred Thousand Dollars ($100,000) (not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against Borrower and the same are not, within ten (10) days after the entry thereof, discharged or execution thereof stayed or bonded pending appeal, or such judgments are not discharged prior to the expiration of any such stay (provided that no Credit Extensions will be made prior to the discharge, stay, or bonding of such judgment, order, or decree);

8.9 Misrepresentations.

Borrower or any Person acting for Borrower makes any representation, warranty, or other statement now or later in this Agreement, any Loan Document or in any writing delivered to Bank or to induce Bank to enter this Agreement or any Loan Document, and such representation, warranty, or other statement is incorrect in any material respect when made;

8.10 Subordinated Debt.

Any document, instrument, or agreement evidencing the subordination of any Subordinated Debt shall for any reason be revoked or invalidated or otherwise cease to be in full force and effect, any Person shall be in breach thereof or contest in any manner the validity or enforceability thereof or deny that it has any further liability or obligation thereunder, or the Obligations shall for any reason be subordinated or shall not have the priority contemplated by this Agreement; or

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8.11 Governmental Approvals.

Any Governmental Approval material to Borrower’s business shall have been (a) revoked, rescinded, suspended, modified in an adverse manner or not renewed in the ordinary course for a full term or (b) subject to any decision by a Governmental Authority that designates a hearing with respect to any applications for renewal of any of such Governmental Approval or that could result in the Governmental Authority taking any of the actions described in clause (a) above, and such decision or such revocation, rescission, suspension, modification or non-renewal (i) has, or could reasonably be expected to have, a Material Adverse Change, or (ii) adversely affects the legal qualifications of Borrower or any of its Subsidiaries to hold such Governmental Approval in any applicable jurisdiction and such revocation, rescission, suspension, modification or non-renewal could reasonably be expected to affect the status of or legal qualifications of Borrower or any of its Subsidiaries to hold any Governmental Approval in any other jurisdiction.

9 BANK’S RIGHTS AND REMEDIES

9.1 Rights and Remedies.

While an Event of Default occurs and continues Bank may, without notice or demand, do any or all of the following:

(a) declare all Obligations immediately due and payable (but if an Event of Default described in Section 8.6 occurs all Obligations are immediately due and payable without any action by Bank);

(b) stop advancing money or extending credit for Borrower’s benefit under this Agreement or under any other agreement between Borrower and Bank;

(c) demand that Borrower (i) deposit cash with Bank in an amount equal to one hundred five percent (105%) of the Dollar Equivalent of the aggregate face amount of all Letters of Credit remaining undrawn (plus all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its good faith business judgment)), to secure all of the Obligations relating to such Letters of Credit, as collateral security for the repayment of any future drawings under such Letters of Credit, and Borrower shall forthwith deposit and pay such amounts, and (ii) pay in advance all letter of credit fees scheduled to be paid or payable over the remaining term of any Letters of Credit;

(d) terminate any FX Forward Contracts;

(e) settle or adjust disputes and claims directly with Account Debtors for amounts on terms and in any order that Bank considers advisable, notify any Person owing Borrower money of Bank’s security interest in such funds, and verify the amount of such account;

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(f) make any payments and do any acts it considers necessary or reasonable to protect the Collateral and/or its security interest in the Collateral. Borrower shall assemble the Collateral if Bank requests and make it available as Bank designates. Bank may enter premises where the Collateral is located, take and maintain possession of any part of the Collateral, and pay, purchase, contest, or compromise any Lien which appears to be prior or superior to its security interest and pay all expenses incurred. Borrower grants Bank a license to enter and occupy any of its premises, without charge, to exercise any of Bank’s rights or remedies;

(g) apply to the Obligations any (i) balances and deposits of Borrower it holds, or (ii) any amount held by Bank owing to or for the credit or the account of Borrower;

(h) ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell the Collateral. Bank is hereby granted a non-exclusive, royalty-free license or other right to use, without charge, Borrower’s labels, Patents, Copyrights, mask works, rights of use of any name, trade secrets, trade names, Trademarks, and advertising matter, or any similar property as it pertains to the Collateral, in completing production of, advertising for sale, and selling any Collateral and, in connection with Bank’s exercise of its rights under this Section, Borrower’s rights under all licenses and all franchise agreements inure to Bank’s benefit;

(i) place a “hold” on any account maintained with Bank and/or deliver a notice of exclusive control, any entitlement order, or other directions or instructions pursuant to any Control Agreement or similar agreements providing control of any Collateral;

(j) demand and receive possession of Borrower’s Books; and

(k) exercise all rights and remedies available to Bank under the Loan Documents or at law or equity, including all remedies provided under the Code (including disposal of the Collateral pursuant to the terms thereof).

9.2 Power of Attorney.

Borrower hereby irrevocably appoints Bank as its lawful attorney-in-fact, exercisable upon the occurrence and during the continuance of an Event of Default, to: (a) endorse Borrower’s name on any checks or other forms of payment or security; (b) sign Borrower’s name on any invoice or bill of lading for any Account or drafts against Account Debtors; (c) settle and adjust disputes and claims about the Accounts directly with Account Debtors, for amounts and on terms Bank determines reasonable; (d) make, settle, and adjust all claims under Borrower’s insurance policies; (e) pay, contest or settle any Lien, charge, encumbrance, security interest, and adverse claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; and (f) transfer the Collateral into the name of Bank or a third party as the Code permits. Borrower hereby appoints Bank as its lawful attorney-in-fact to sign Borrower’s name on any documents necessary to perfect or continue the perfection of Bank’s security interest in the Collateral regardless of whether an Event of Default has occurred until all Obligations have been satisfied in full (not including inchoate indemnity obligations and any of Borrower’s obligations arising from the Warrant) and Bank is under no further obligation to make Credit Extensions hereunder. Bank’s foregoing appointment as Borrower’s attorney in

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fact, and all of Bank’s rights and powers, coupled with an interest, are irrevocable until all Obligations have been fully repaid and performed (not including inchoate indemnity obligations and any of Borrower’s obligations arising from the Warrant) and Bank’s obligation to provide Credit Extensions terminates.

9.3 Protective Payments.

If Borrower fails to obtain the insurance called for by Section 6.7 or fails to pay any premium thereon or fails to pay any other amount which Borrower is obligated to pay under this Agreement or any other Loan Document, Bank may obtain such insurance or make such payment, and all amounts so paid by Bank are Bank Expenses and immediately due and payable, bearing interest at the then highest rate applicable to the Obligations, and secured by the Collateral. Bank will make reasonable efforts to provide Borrower with notice of Bank obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Bank are deemed an agreement to make similar payments in the future or Bank’s waiver of any Event of Default.

9.4 Application of Payments and Proceeds.

Borrower shall have no right to specify the order or the accounts to which Bank shall allocate or apply any payments required to be made by Borrower to Bank or otherwise received by Bank under this Agreement when any such allocation or application is not specified elsewhere in this Agreement. If an Event of Default has occurred and is continuing, Bank may apply any funds in its possession, whether from Borrower account balances, payments, proceeds realized as the result of any collection of Accounts or other disposition of the Collateral, or otherwise, to the Obligations in such order as Bank shall determine in its sole discretion. Any surplus shall be paid to Borrower by credit to the Designated Deposit Account or to other Persons legally entitled thereto; Borrower shall remain liable to Bank for any deficiency. If Bank, in its good faith business judgment, directly or indirectly enters into a deferred payment or other credit transaction with any purchaser at any sale of Collateral, Bank shall have the option, exercisable at any time, of either reducing the Obligations by the principal amount of the purchase price or deferring the reduction of the Obligations until the actual receipt by Bank of cash therefor.

9.5 Bank’s Liability for Collateral.

So long as Bank complies with reasonable banking practices regarding the safekeeping of the Collateral in the possession or under the control of Bank, Bank shall not be liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage to the Collateral; (c) any diminution in the value of the Collateral; or (d) any act or default of any carrier, warehouseman, bailee, or other Person. Borrower bears all risk of loss, damage or destruction of the Collateral other than those losses directly resulting from Bank’s gross negligence or willful misconduct.

9.6 No Waiver; Remedies Cumulative.

Bank’s failure, at any time or times, to require strict performance by Borrower of any provision of this Agreement or any other Loan Document shall not waive, affect, or diminish any right of Bank thereafter to demand strict performance and compliance herewith or therewith. No

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waiver hereunder shall be effective unless signed by the party granting the waiver and then is only effective for the specific instance and purpose for which it is given. Bank’s rights and remedies under this Agreement and the other Loan Documents are cumulative. Bank has all rights and remedies provided under the Code, by law, or in equity. Bank’s exercise of one right or remedy is not an election and shall not preclude Bank from exercising any other remedy under this Agreement or other remedy available at law or in equity, and Bank’s waiver of any Event of Default is not a continuing waiver. Bank’s delay in exercising any remedy is not a waiver, election, or acquiescence.

9.7 Demand Waiver.

Borrower waives demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by Bank on which Borrower is liable.

10 NOTICES

All notices, consents, requests, approvals, demands, or other communication by any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or delivered: (a) upon the earlier of actual receipt and three (3) Business Days after deposit in the U.S. mail, first class, registered or certified mail return receipt requested, with proper postage prepaid; (b) upon transmission, when sent by electronic mail or facsimile transmission; (c) one (1) Business Day after deposit with a reputable overnight courier with all charges prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed to the party to be notified and sent to the address, facsimile number, or email address indicated below. Bank or Borrower may change its mailing or electronic mail address or facsimile number by giving the other party written notice thereof in accordance with the terms of this Section 10.

If to Borrower:	eASIC Corporation
	2585 Augustine Drive, Suite 100
	Santa Clara, California 95054
	Attn: Larry Borras
	Fax: (408) 855-9201
	Email: lborras@easic.com
If to Bank:	Silicon Valley Bank
	2400 Hanover Street
	Palo Alto, California 94304
	Attn: Matthew Wright
	Fax: (650) 320-0016
	Email: mwright@svb.com

11 CHOICE OF LAW, VENUE, JURY TRIAL WAIVER AND JUDICIAL REFERENCE

California law governs the Loan Documents without regard to principles of conflicts of law. Borrower and Bank each submit to the exclusive jurisdiction of the State and Federal courts

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in Santa Clara County, California; provided, however, that nothing in this Agreement shall be deemed to operate to preclude Bank from bringing suit or taking other legal action in any other jurisdiction to realize on the Collateral or any other security for the Obligations, or to enforce a judgment or other court order in favor of Bank. Borrower expressly submits and consents in advance to such jurisdiction in any action or suit commenced in any such court, and Borrower hereby waives any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consents to the granting of such legal or equitable relief as is deemed appropriate by such court. Borrower hereby waives personal service of the summons, complaints, and other process issued in such action or suit and agrees that service of such summons, complaints, and other process may be made by registered or certified mail addressed to Borrower at the address set forth in, or subsequently provided by Borrower in accordance with, Section 10 of this Agreement and that service so made shall be deemed completed upon the earlier to occur of Borrower’s actual receipt thereof or three (3) days after deposit in the U.S. mails, proper postage prepaid.

TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND BANK EACH WAIVE THEIR RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A MATERIAL INDUCEMENT FOR BOTH PARTIES TO ENTER INTO THIS AGREEMENT. EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.

WITHOUT INTENDING IN ANY WAY TO LIMIT THE PARTIES’ AGREEMENT TO WAIVE THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY, if the above waiver of the right to a trial by jury is not enforceable, the parties hereto agree that any and all disputes or controversies of any nature between them arising at any time shall be decided by a reference to a private judge, mutually selected by the parties (or, if they cannot agree, by the Presiding Judge of the Santa Clara County, California Superior Court) appointed in accordance with California Code of Civil Procedure Section 638 (or pursuant to comparable provisions of federal law if the dispute falls within the exclusive jurisdiction of the federal courts), sitting without a jury, in Santa Clara County, California; and the parties hereby submit to the jurisdiction of such court. The reference proceedings shall be conducted pursuant to and in accordance with the provisions of California Code of Civil Procedure §§ 638 through 645.1, inclusive. The private judge shall have the power, among others, to grant provisional relief, including without limitation, entering temporary restraining orders, issuing preliminary and permanent injunctions and appointing receivers. All such proceedings shall be closed to the public and confidential and all records relating thereto shall be permanently sealed. If during the course of any dispute, a party desires to seek provisional relief, but a judge has not been appointed at that point pursuant to the judicial reference procedures, then such party may apply to the Santa Clara County, California Superior Court for such relief. The proceeding before the private judge shall be conducted in the same manner as it would be before a court under the rules of evidence applicable to judicial proceedings. The parties shall be entitled to discovery which shall be conducted in the same manner as it would be before a court under the rules of discovery applicable to judicial proceedings. The private judge shall oversee discovery and may enforce all discovery rules and orders applicable to judicial proceedings in the same manner as a trial court judge. The parties

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agree that the selected or appointed private judge shall have the power to decide all issues in the action or proceeding, whether of fact or of law, and shall report a statement of decision thereon pursuant to California Code of Civil Procedure § 644(a). Nothing in this paragraph shall limit the right of any party at any time to exercise self-help remedies, foreclose against collateral, or obtain provisional remedies. The private judge shall also determine all issues relating to the applicability, interpretation, and enforceability of this paragraph.

12 GENERAL PROVISIONS

12.1 Termination Prior to Revolving Line Maturity Date.

This Agreement may be terminated prior to the Revolving Line Maturity Date by Borrower, effective three (3) Business Days after written notice of termination is given to Bank. Notwithstanding any such termination, Bank’s lien and security interest in the Collateral shall continue until Borrower fully satisfies its Obligations (other than inchoate indemnity obligations and any of Borrower’s obligations arising from the Warrant).

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 of the Warrant).

12.3 Indemnification.

Borrower agrees to indemnify, defend and hold Bank and its directors, officers, employees, agents, attorneys, or any other Person affiliated with or representing Bank (each, an “Indemnified Person”) harmless against: (a) all obligations, demands, claims, and liabilities (collectively, “Claims”) claimed or asserted by any other party in connection with the transactions contemplated by the Loan Documents; and (b) all losses or expenses (including Bank Expenses) in any way suffered, incurred, or paid by such Indemnified Person as a result of, following from, consequential to, or arising from transactions between Bank and Borrower contemplated by the Loan Documents (including reasonable attorneys’ fees and expenses), except for Claims and/or losses directly caused by such Indemnified Person’s gross negligence or willful misconduct.

12.4 Time of Essence.

Time is of the essence for the performance of all Obligations in this Agreement.

12.5 Severability of Provisions.

Each provision of this Agreement is severable from every other provision in determining the enforceability of any provision.

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12.6 Correction of Loan Documents.

Bank may correct patent errors and fill in any blanks in the Loan Documents consistent with the agreement of the parties, provided that Bank provides prompt written notice to Borrower of such correction.

12.7 Amendments in Writing; Waiver; Integration.

No purported amendment or modification of any Loan Document, or waiver, discharge or termination of any obligation under any Loan Document, shall be enforceable or admissible unless, and only to the extent, expressly set forth in a writing signed by the party against which enforcement or admission is sought. Without limiting the generality of the foregoing, no oral promise or statement, nor any action, inaction, delay, failure to require performance or course of conduct shall operate as, or evidence, an amendment, supplement or waiver or have any other effect on any Loan Document. Any waiver granted shall be limited to the specific circumstance expressly described in it, and shall not apply to any subsequent or other circumstance, whether similar or dissimilar, or give rise to, or evidence, any obligation or commitment to grant any further waiver. 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 the Loan Documents merge into the Loan Documents.

12.8 Counterparts.

This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, is an original, and all taken together, constitute one Agreement.

12.9 Survival.

All covenants, representations and warranties made in this Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations (other than inchoate indemnity obligations and any other obligations which, by their terms, are to survive the termination of this Agreement) have been satisfied. The obligation of Borrower in Section 12.3 to indemnify Bank shall survive until the statute of limitations with respect to such claim or cause of action shall have run.

12.10 Confidentiality.

In handling any confidential information, Bank shall exercise the same degree of care that it exercises for its own proprietary information, but disclosure of information may be made: (a) to Bank’s Subsidiaries or Affiliates (such Subsidiaries and Affiliates, together with Bank, collectively, “Bank Entities”); (b) to prospective transferees or purchasers of any interest in the Credit Extensions (provided, however, Bank shall use its best efforts to obtain any prospective transferee’s or purchaser’s agreement to the terms of this provision); (c) as required by law, regulation, subpoena, or other order; (d) to Bank’s regulators or as otherwise required in connection with Bank’s examination or audit; (e) as Bank considers appropriate in exercising remedies under the Loan Documents; and (f) to third-party service providers of Bank so long as

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such service providers have executed a confidentiality agreement with Bank with terms no less restrictive than those contained herein. Confidential information does not include information that is either: (i) in the public domain or in Bank’s possession when disclosed to Bank, or becomes part of the public domain after disclosure to Bank; or (ii) disclosed to Bank by a third party if Bank does not know that the third party is prohibited from disclosing the information.

Bank Entities may use the confidential information for reporting purposes and the development and distribution of databases and market analyses so long as such confidential information is aggregated and anonymized prior to distribution unless otherwise expressly prohibited by Borrower. The provisions of the immediately preceding sentence shall survive the termination of this Agreement.

12.11 Attorneys’ Fees, Costs and Expenses.

In any action or proceeding between Borrower and Bank arising out of or relating to the Loan Documents, the prevailing party shall be entitled to recover its reasonable attorneys’ fees and other costs and expenses incurred, in addition to any other relief to which it may be entitled.

12.12 Electronic Execution of Documents.

The words “execution,” “signed,” “signature” and words of like import in any Loan Document shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity and enforceability as a manually executed signature or the use of a paper-based recordkeeping systems, as the case may be, to the extent and as provided for in any applicable law, including, without limitation, any state law based on the Uniform Electronic Transactions Act.

12.13 Captions.

The headings used in this Agreement are for convenience only and shall not affect the interpretation of this Agreement.

12.14 Construction of Agreement.

The parties mutually acknowledge that they and their attorneys have participated in the preparation and negotiation of this Agreement. In cases of uncertainty this Agreement shall be construed without regard to which of the parties caused the uncertainty to exist.

12.15 Relationship.

The relationship of the parties to this Agreement is determined solely by the provisions of this Agreement. The parties do not intend to create any agency, partnership, joint venture, trust, fiduciary or other relationship with duties or incidents different from those of parties to an arm’s-length contract.

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12.16 Third Parties.

Nothing in this Agreement, whether express or implied, is intended to: (a) confer any benefits, rights or remedies under or by reason of this Agreement on any persons other than the express parties to it and their respective permitted successors and assigns; (b) relieve or discharge the obligation or liability of any person not an express party to this Agreement; or (c) give any person not an express party to this Agreement any right of subrogation or action against any party to this Agreement.

13 DEFINITIONS

13.1 Definitions.

As used in the Loan Documents, the word “shall” is mandatory, the word “may” is permissive, the word “or” is not exclusive, the words “includes” and “including” are not limiting, the singular includes the plural, and numbers denoting amounts that are set off in brackets are negative. As used in this Agreement, the following capitalized terms have the following meanings:

“Account” is any “account” as defined in the Code with such additions to such term as may hereafter be made, and includes, without limitation, all accounts receivable and other sums owing to Borrower.

“Account Debtor” is any “account debtor” as defined in the Code with such additions to such term as may hereafter be made.

“Advance” or “Advances” means an advance (or advances) under the Revolving Line.

“Affiliate” is, with respect to any Person, each other Person that owns or controls directly or indirectly the Person, any Person that controls or is controlled by or is under common control with the Person, and each of that Person’s senior executive officers, directors, partners and, for any Person that is a limited liability company, that Person’s managers and members.

“Agreement” is defined in the preamble hereof.

“Availability Amount” is (a) the lesser of (i) the Revolving Line or (ii) the amount available under the Borrowing Base, minus (b) the Dollar Equivalent amount of all outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), minus (c) the FX Reduction Amount, minus (d) any amounts used for Cash Management Services, and minus (e) the outstanding principal balance of any Advances.

“Bank” is defined in the preamble hereof.

“Bank Expenses” are all audit fees and expenses, costs, and expenses (including reasonable attorneys’ fees and expenses) for preparing, amending, negotiating, administering, defending and enforcing the Loan Documents (including, without limitation, those incurred in connection with appeals or Insolvency Proceedings) or otherwise incurred with respect to Borrower.

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“Bermuda Subsidiary” means eASIC Limited, a wholly-owned Subsidiary of Borrower, which is formed under the laws of Bermuda.

“Borrower” is defined in the preamble hereof

“Borrower’s Books” are all Borrower’s books and records including ledgers, federal and state tax returns, records regarding Borrower’s assets or liabilities, the Collateral, business operations or financial condition, and all computer programs or storage or any equipment containing such information.

“Borrowing Base” is eighty percent (80.0%) of Eligible Accounts, as determined by Bank from Borrower’s most recent Transaction Report; provided, however, that Bank may decrease the foregoing percentage in its good faith business judgment based on events, conditions, contingencies, or risks which, as determined by Bank, may adversely affect Collateral.

“Borrowing Resolutions” are, with respect to any Person, those resolutions substantially in the form attached hereto as Exhibit E.

“Business Day” is any day that is not a Saturday, Sunday or a day on which Bank is closed.

“Cash Equivalents” means (a) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency or any State thereof having maturities of not more than one (1) year from the date of acquisition; (b) commercial paper maturing no more than one (1) year after its creation and having the highest rating from either Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc.; and (c) Bank’s certificates of deposit issued maturing no more than one (1) year after issue.

“Cash Management Services” is defined in Section 2.1.5.

“Claims” is defined in Section 12.3.

“Code” is the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the State of California; provided, that, to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently in different Articles or Divisions of the Code, the definition of such term contained in Article or Division 9 shall govern; provided further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, or priority of, or remedies with respect to, Bank’s Lien on any Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than the State of California, the term “Code” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority, or remedies and for purposes of definitions relating to such provisions.

“Collateral” is any and all properties, rights and assets of Borrower described on Exhibit A.

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“Collateral Account” is any Deposit Account, Securities Account, or Commodity Account.

“Collections” are all funds received by Bank from or on behalf of an Account Debtor for Advances under the Revolving Line.

“Comerica Bank Accounts” is defined in Section 6.8(a).

“Commitment Fee” is defined in Section 2.4(a).

“Commodity Account” is any “commodity account” as defined in the Code with such additions to such term as may hereafter be made.

“Compliance Certificate” is that certain certificate in the form attached hereto as Exhibit B.

“Contingent Obligation” is, for any Person, any direct or indirect liability, contingent or not, of that Person for (a) any indebtedness, lease, dividend, letter of credit or other obligation of another such as an obligation, in each case, directly or indirectly guaranteed, endorsed, co-made, discounted or sold with recourse by that Person, or for which that Person is directly or indirectly liable; (b) any obligations for undrawn letters of credit for the account of that Person; and (c) all obligations from any interest rate, currency or commodity swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; but “Contingent Obligation” does not include endorsements in the ordinary course of business. The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement.

“Control Agreement” is any control agreement entered into among the depository institution at which Borrower maintains a Deposit Account or the securities intermediary or commodity intermediary at which Borrower maintains a Securities Account or a Commodity Account, Borrower, and Bank pursuant to which Bank obtains control (within the meaning of the Code) over such Deposit Account, Securities Account, or Commodity Account.

“Conversion Date” means, for each Pre-Conversion Date Growth Capital Advance, the first (1^st) day after the end of the Growth Capital Interest Only Period for such Pre-Conversion Date Growth Capital Advance.

“Copyrights” are any and all copyright rights, copyright applications, copyright registrations and like protections in each work or authorship and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret.

“Credit Extension” is any Growth Capital Advance, Advance, Letter of Credit, FX Forward Contract, amount utilized for Cash Management Services, or any other extension of credit by Bank for Borrower’s benefit.

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“Default Rate” is defined in Section 2.3(b).

“Deferred Revenue” is all amounts received or invoiced in advance of performance under contracts and not yet recognized as revenue.

“Deposit Account” is any “deposit account” as defined in the Code with such additions to such term as may hereafter be made.

“Designated Deposit Account” IS Borrower’s deposit account, account number             , maintained with Bank.

“Dollars,” “dollars” or use of the sign “$” means only lawful money of the United States and not any other currency, regardless of whether that currency uses the “$” sign to denote its currency or may be readily converted into lawful money of the United States.

“Dollar Equivalent” is, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) with respect to any amount denominated in a Foreign Currency, the equivalent amount therefor in Dollars as determined by Bank at such time on the basis of the then-prevailing rate of exchange in San Francisco, California, for sales of the Foreign Currency for transfer to the country issuing such Foreign Currency.

“Effective Date” is defined in the preamble hereof.

“Eligible Accounts” means Accounts which arise in the ordinary course of Borrower’s business that meet all Borrower’s representations and warranties in Section 5.3. Bank reserves the right at any time after the Effective Date to adjust any of the criteria set forth below and to establish new criteria in its good faith business judgment. Unless Bank otherwise agrees in writing, Eligible Accounts shall not include:

(a) Accounts for which the Account Debtor is Borrower’s Affiliate, officer, employee, or agent;

(b) Accounts that the Account Debtor has not paid within ninety (90) days of invoice date regardless of invoice payment period terms;

(c) Accounts with credit balances over ninety (90) days from invoice date;

(d) Accounts owing from an Account Debtor, in which fifty percent (50%) or more of the Accounts have not been paid within ninety (90) days of invoice date;

(e) Accounts owing from an Account Debtor which does not have its principal place of business in the United States unless (i) such Accounts are otherwise Eligible Accounts and (ii) Bank approves of in writing;

(f) Accounts billed and/or payable outside of the United States (sometimes called foreign invoiced accounts);

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(g) Accounts owing from an Account Debtor to the extent that Borrower is indebted or obligated in any manner to the Account Debtor (as creditor, lessor, supplier or otherwise—sometimes called “contra” accounts, accounts payable, customer deposits or credit accounts).

(h) Accounts owing from an Account Debtor which is a United States government entity or any department, agency, or instrumentality thereof unless Borrower has assigned its payment rights to Bank and the assignment has been acknowledged under the Federal Assignment of Claims Act of 1940, as amended;

(i) Accounts for demonstration or promotional equipment, or in which goods are consigned, or sold on a “sale guaranteed”, “sale or return”, “sale on approval”, or other terms if Account Debtor’s payment may be conditional;

(j) Accounts owing from an Account Debtor where goods or services have not yet been rendered to the Account Debtor (sometimes called memo billings or pre-billings);

(k) Accounts subject to contractual arrangements between Borrower and an Account Debtor where payments shall be scheduled or due according to completion or fulfillment requirements where the Account Debtor has a right of offset for damages suffered as a result of Borrower’s failure to perform in accordance with the contract (sometimes called contracts accounts receivable, progress billings, milestone billings, or fulfillment contracts);

(l) Accounts owing from an Account Debtor the amount of which may be subject to withholding based on the Account Debtor’s satisfaction of Borrower’s complete performance (but only to the extent of the amount withheld; sometimes called retainage billings);

(m) Accounts subject to trust provisions, subrogation rights of a bonding company, or a statutory trust;

(n) Accounts owing from an Account Debtor that has been invoiced for goods that have not been shipped to the Account Debtor unless Bank, Borrower, and the Account Debtor have entered into an agreement acceptable to Bank in its sole discretion wherein the Account Debtor acknowledges that (i) it has title to and has ownership of the goods wherever located, (ii) a bona fide sale of the goods has occurred, and (iii) it owes payment for such goods in accordance with invoices from Borrower (sometimes called “bill and hold” accounts);

(o) Accounts for which the Account Debtor has not been invoiced;

(p) Accounts that represent non-trade receivables or that are derived by means other than in the ordinary course of Borrower’s business;

(q) Accounts for which Borrower has permitted Account Debtor’s payment to extend beyond ninety (90) days;

(r) Accounts arising from chargebacks, debit memos or others payment deductions taken by an Account Debtor;

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(s) Accounts arising from product returns and/or exchanges (sometimes called “warranty” or “RMA” accounts);

(t) Accounts in which the Account Debtor disputes liability or makes any claim (but only up to the disputed or claimed amount), or if the Account Debtor is subject to an Insolvency Proceeding, or becomes insolvent, or goes out of business;

(u) Accounts owing from an Account Debtor with respect to which Borrower has received Deferred Revenue (but only to the extent of such Deferred Revenue);

(v) Accounts owing from an Account Debtor, whose total obligations to Borrower exceed thirty percent (30.0%) of all Accounts, for the amounts that exceed that percentage, unless Bank approves in writing; and

(w) Accounts for which Bank in its good faith business judgment determines collection to be doubtful, including, without limitation, accounts represented by “refreshed” or “recycled” invoices.

“Eligible Purchase Orders” are Purchase Orders made by Borrower in the ordinary course of Borrower’s business that meet all Borrower’s representations and warranties, and are otherwise acceptable to Bank in all respects. The determination of which Purchase Orders are eligible hereunder is a matter of Bank’s discretion in each instance.

“Equipment” is all “equipment” as defined in the Code with such additions to such term as may hereafter be made, and includes without limitation all machinery, fixtures, goods, vehicles (including motor vehicles and trailers), and any interest in any of the foregoing.

“ERISA” is the Employee Retirement Income Security Act of 1974, and its regulations.

“Event of Default” is defined in Section 8.

“Exchange Act” is the Securities Exchange Act of 1934, as amended.

“Final Payment” is a payment (in addition to and not a substitution for the regular monthly payments of principal and accrued interest) due on the date set forth in Sections 2.l.l(c), 2.1.1(d) and 2.1.l(e), equal to two percent (2.00%) of the aggregate amount of the Growth Capital Advances made under this Agreement.

“Foreign Currency” means lawful money of a country other than the United States.

“Foreign Deposit Account” and “Foreign Deposit Accounts” are defined in Section 6.8(a).

“Funding Date” is any date on which a Credit Extension is made to or for the account of Borrower which shall be a Business Day.

“FX Business Day” is any day when (a) Bank’s Foreign Exchange Department is conducting its normal business and (b) the Foreign Currency being purchased or sold by Borrower is available to Bank from the entity from which Bank shall buy or sell such Foreign Currency.

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“FX Forward Contract” is defined in Section 2.1.4.

“FX Reduction Amount” is defined in Section 2.1.4.

“FX Reserve” is defined in Section 2.1.4.

“GAAP” is generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other Person as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the date of determination.

“General Intangibles” is all “general intangibles” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation, all Intellectual Property, claims, income and other tax refunds, security and other deposits, payment intangibles, contract rights, options to purchase or sell real or personal property, rights in all litigation presently or hereafter pending (whether in contract, tort or otherwise), insurance policies (including without limitation key man, property damage, and business interruption insurance), payments of insurance and rights to payment of any kind.

“Good Faith Deposit” is defined in Section 2.4(a).

“Governmental Approval” is any consent, authorization, approval, order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority.

“Governmental Authority” is any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any self-regulatory organization.

“Growth Capital Advance” and “Growth Capital Advances” are defined in Section 2.1.1(a).

“Growth Capital Interest Only Extension Requirements” means, as of any date of determination, Bank’s receipt and approval of evidence satisfactory to Bank that (i) Borrower has generated positive Net Income of not less than One Hundred Thousand Dollars ($100,000) for the fiscal quarter immediately preceding such date, measured as of the last day of such fiscal quarter and (ii) Borrower has maintained not less than Eight Million Dollars ($8,000,000) in cash (inclusive of any proceeds from the Credit Extensions) at Bank or Bank’s Affiliates during the fiscal quarter immediately preceding such date and as of the date of determination.

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“Growth Capital Interest Only Period” is the Effective Date through December 31, 2011; provided however, that such Growth Capital Interest Only Period may be extended as follows: (a) provided that Borrower delivers evidence satisfactory to Bank on or before January 15, 2012, showing that, in Bank’s discretion, Borrower satisfies the Growth Capital Interest Only Extension Requirements as of December 31, 2011, the Growth Capital Interest Only Period shall be extended through March 31, 2012, and (b) further provided that Borrower delivers evidence satisfactory to Bank on or before April 15, 2012, showing that, in Bank’s discretion, Borrower satisfies the Growth Capital Interest Only Extension Requirements as of March 31, 2012, the Growth Capital Interest Only Period shall be further extended through June 30, 2012.

“Growth Capital Line” is Growth Capital Advances in an aggregate amount not to exceed Five Million Dollars ($5,000,000) outstanding at any time.

“Growth Capital Maturity Date” is the last day of the Growth Capital Repayment Period of the applicable Growth Capital Advance, but no later than June 30, 2014.

“Growth Capital Repayment Period” as to (i) each Pre-Conversion Date Growth Capital Advance, is a period of time equal to the number of consecutive complete calendar months from the month on which the Conversion Date occurs and continuing through the Growth Capital Maturity Date, and (ii) each Post-Conversion Date Growth Capital Advance, is a period of time equal to the number of consecutive complete calendar months from the month on which the Funding Date of such Post-Conversion Date Growth Capital Advance occurs (or commencing on the Funding Date if the Funding Date is the last calendar day of the month) and continuing through the Growth Capital Maturity Date.

“Indebtedness” is (a) indebtedness for borrowed money or the deferred price of property or services, such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations, and (d) Contingent Obligations.

“Indemnified Person” is defined in Section 12.3.

“Initial Audit” is Bank’s initial inspection of the Collateral and Borrower’s Books with results satisfactory to Bank in its sole and absolute discretion.

“Insolvency Proceeding” is any proceeding by or against any Person under the United States Bankruptcy Code, or any other bankruptcy or insolvency law, including assignments for the benefit of creditors, compositions, extensions generally with its creditors, or proceedings seeking reorganization, arrangement, or other relief.

“Intellectual Property” means all of Borrower’s right, title, and interest in and to the following:

(a) its Copyrights, Trademarks and Patents;

(b) any and all trade secrets and trade secret rights, including, without limitation, any rights to unpatented inventions, know-how, operating manuals;

40.

(c) any and all source code;

(d) any and all design rights which may be available to a Borrower;

(e) any and all claims for damages by way of past, present and future infringement of any of the foregoing, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the Intellectual Property rights identified above; and

(f) all amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents.

“Inventory” is all “inventory” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation all merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and finished products, including without limitation such inventory as is temporarily out of Borrower’s custody or possession or in transit and including any returned goods and any documents of title representing any of the above.

“Investment” is any beneficial ownership interest in any Person (including stock, partnership interest or other securities), and any loan, advance or capital contribution to any Person.

“Letter of Credit” means a standby letter of credit issued by Bank or another institution based upon an application, guarantee, indemnity or similar agreement on the part of Bank as set forth in Section 2.1.3.

“Letter of Credit Application” is defined in Section 2.1.3(b).

“Lien” is a claim, mortgage, deed of trust, levy, charge, pledge, security interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property.

“Loan Documents” are, collectively, this Agreement, the Warrant, the Perfection Certificate, the Stock Pledge Agreement, any note, or notes or guaranties executed by Borrower, and any other present or future agreement between Borrower and/or for the benefit of Bank in connection with this Agreement, all as amended, restated, or otherwise modified.

“Malaysia Subsidiary” means eASIC (M) Sdn Bhd, a wholly-owned Subsidiary of Borrower, which is formed under the laws of Malaysia.

“Material Adverse Change” is (a) a material impairment in the perfection or priority of Bank’s Lien in the Collateral or in the value of such Collateral; (b) a material adverse change in the business, operations, or condition (financial or otherwise) of Borrower; or (c) a material impairment of the prospect of repayment of any portion of the Obligations.

“Monthly Financial Statements” is defined in Section 6.2(c).

41.

“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.

“Obligations” are Borrower’s obligations to pay when due any debts, principal, interest, Bank Expenses and other amounts Borrower owes Bank now or later, whether under this Agreement, the Loan Documents (other than the Warrant), 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.

“Operating Documents” are, for any Person, such Person’s formation documents, as certified with the Secretary of State of such Person’s state of formation on a date that is no earlier than thirty (30) days prior to the Effective Date, and, (a) if such Person is a corporation, its bylaws in current form, (b) if such Person is a limited liability company, its limited liability company agreement (or similar agreement), and (c) if such Person is a partnership, its partnership agreement (or similar agreement), each of the foregoing with all current amendments or modifications thereto.

“Overadvance” is defined in Section 2.2.

“Patents” means all patents, patent applications and like protections including without limitation improvements, divisions, continuations, renewals, reissues, extensions and continuations-in-part of the same.

“Payment” means all checks, wire transfers and other items of payment received by Bank (including proceeds of Accounts and payment of the Obligations in full) for credit to Borrower’s outstanding Credit Extensions or, if the balance of the Credit Extensions has been reduced to zero, for credit to its deposit accounts.

“Payment/Advance Form” is that certain form attached hereto as Exhibit D.

“Perfection Certificate” is defined in Section 5.1.

“Permitted Indebtedness” is:

(a) Borrower’s Indebtedness to Bank under this Agreement and the other Loan Documents;

(b) Indebtedness existing on the Effective Date and shown on the Perfection Certificate;

(c) Subordinated Debt;

(d) unsecured Indebtedness to trade creditors incurred in the ordinary course of business;

42.

(e) Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business;

(f) Indebtedness secured by Liens permitted under clauses (a) and (c) of the definition of “Permitted Liens” hereunder; and

(g) extensions, refinancings, modifications, amendments and restatements of any items of Permitted Indebtedness (a) through (f) above, provided that the principal amount thereof is not increased or the terms thereof are not modified to impose more burdensome terms upon Borrower or its Subsidiary, as the case may be.

“Permitted Investments” are:

(a) Investments (including, without limitation, Subsidiaries) existing on the Effective Date and shown on the Perfection Certificate;

(b) Investments consisting of Cash Equivalents;

(c) Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of Borrower;

(d) Investments consisting of deposit accounts in which Bank has a perfected security interest;

(e) Investments accepted in connection with Transfers permitted by Section 7.1;

(f) Investments (i) by Borrower in Subsidiaries not to exceed Five Hundred Thousand Dollars ($500,000) in the aggregate in any fiscal year and (ii) by Subsidiaries in other Subsidiaries not to exceed Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate in any fiscal year or in Borrower;

(g) Investments consisting of (i) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business, and (ii) loans to employees, officers or directors relating to the purchase of equity securities of Borrower or its Subsidiaries pursuant to employee stock purchase plans or agreements approved by Borrower’s Board of Directors;

(h) Investments (including debt obligations) received in connection with the bankruptcy or reorganization of customers or suppliers and in settlement of delinquent obligations of, and other disputes with, customers or suppliers arising in the ordinary course of business;

(i) Investments consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers and suppliers who are not Affiliates, in the ordinary course of business; provided that this paragraph (i) shall not apply to Investments of Borrower in any Subsidiary; and

43.

(j) Investments in joint ventures, strategic alliances, licensing and similar arrangements customary in Borrower’s industry in an aggregate amount not to exceed Three Hundred Fifty Thousand Dollars ($350,000), and which do not require Borrower to assume or otherwise become liable for the obligations of any third party not directly related to or arising out of such arrangement or, without prior written consent of the Bank, require Borrower to transfer ownership of non-cash assets to such joint venture or other entity.

“Permitted Liens” are:

(a) Liens existing on the Effective Date and shown on the Perfection Certificate or arising under this Agreement and the other Loan Documents;

(b) Liens for taxes, fees, assessments or other government charges or levies, either (i) not due and payable or (ii) being contested in good faith and for which Borrower maintains adequate reserves on its Books, provided that no notice of any such Lien has been filed or recorded under the Internal Revenue Code of 1986, as amended, and the Treasury Regulations adopted thereunder;

(c) purchase money Liens (i) on Equipment acquired or held by Borrower incurred for financing the acquisition of the Equipment securing no more than One Hundred Thousand Dollars ($100,000) in the aggregate amount outstanding, or (ii) existing on Equipment when acquired, if the Lien is confined to the property and improvements and the proceeds of the Equipment;

(d) Liens of carriers, warehousemen, suppliers, or other Persons that are possessory in nature arising in the ordinary course of business so long as such Liens attach only to Inventory, securing liabilities in the aggregate amount not to exceed One Hundred Thousand Dollars ($100,000) and which are not delinquent or remain payable without penalty or which are being contested in good faith and by appropriate proceedings which proceedings have the effect of preventing the forfeiture or sale of the property subject thereto;

(e) Liens to secure payment of workers’ compensation, employment insurance, old-age pensions, social security and other like obligations incurred in the ordinary course of business (other than Liens imposed by ERISA);

(f) Liens incurred in the extension, renewal or refinancing of the indebtedness secured by Liens described in (a) through (c), but any extension, renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness may not increase;

(g) leases or subleases of real property granted in the ordinary course of Borrower’s business (or, if referring to another Person, in the ordinary course of such Person’s business), and leases, subleases, non-exclusive licenses or sublicenses of personal property (other than Intellectual Property) granted in the ordinary course of Borrower’s business (or, if referring to another Person, in the ordinary course of such Person’s business), if the leases, subleases, licenses and sublicenses do not prohibit granting Bank a security interest therein;

44.

(h) non-exclusive license of Intellectual Property granted to third parties in the ordinary course of business;

(i) Liens arising from attachments or judgments, orders, or decrees in circumstances not constituting an Event of Default under Sections 8.5 and 8.8; and

(j) Liens in favor of other financial institutions arising in connection with Borrower’s deposit and/or securities accounts held at such institutions, provided that Bank has a perfected security interest in the amounts held in such deposit and/or securities accounts.

“Person” is any individual, sole proprietorship, partnership, limited liability company, joint venture, company, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or government agency.

“Post-Conversion Date Growth Capital Advance” and “Post-Conversion Date Growth Capital Advances” are defined in Section 2.1.1(b)(ii).

“Pre-Conversion Date Growth Capital Advance” and “Pre-Conversion Date Growth Capital Advances” are defined in Section 2.1.1(b)(i).

“Prime Rate” is Bank’s most recently announced “prime rate,” even if it is not Bank’s lowest rate.

“Purchase Order” shall mean either (i) a signed purchase order made by Borrower in connection with Borrower’s wafer inventory purchases from a third-party or (ii) a committed customer forecast from Borrower detailing Borrower’s requirements for Borrower’s wafer inventory purchases from a third-party.

“Registered Organization” is any “registered organization” as defined in the Code with such additions to such term as may hereafter be made

“Requirement of Law” is as to any Person, the organizational or governing documents of such Person, and any law (statutory or common), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

“Reserves” means, as of any date of determination, such amounts as Bank may from time to time establish and revise in its good faith business judgment, reducing the amount of Advances and other financial accommodations which would otherwise be available to Borrower (a) to reflect events, conditions, contingencies or risks which, as determined by Bank in its good faith business judgment, do or may adversely affect (i) the Collateral or any other property which is security for the Obligations or its value (including without limitation any increase in delinquencies of Accounts), (ii) the assets, business or prospects of Borrower, or (iii) the security interests and other rights of Bank in the Collateral (including the enforceability, perfection and priority thereof); or (b) to reflect Bank’s good faith belief that any collateral report or financial information furnished by or on behalf of Borrower to Bank is or may have been incomplete, inaccurate or misleading in any material respect; or (c) in respect of any state of facts which Bank determines in good faith constitutes an Event of Default or may, with notice or passage of time or both, constitute an Event of Default.

45.

“Responsible Officer” is any of the Chief Executive Officer (who is Ronnie Vasishta, as of the Effective Date), President (who is Ronnie Vasishta, as of the Effective Date), Senior Director of Finance (who is Larry Borras, as of the Effective Date), or Chief Financial Officer of Borrower (if and when such office filled).

“Restricted License” is any material license or other agreement with respect to which Borrower is the licensee (a) that prohibits or otherwise restricts Borrower from granting a security interest in Borrower’s interest in such license or agreement or any other property, or (b) for which a default under or termination of could interfere with the Bank’s right to sell any Collateral.

“Revolving Line” is an Advance or Advances in an amount equal to Three Million Dollars ($3,000,000).

“Revolving Line Maturity Date” is September 29, 2012.

“SEC” shall mean the Securities and Exchange Commission, any successor thereto, and any analogous Governmental Authority.

“Securities Account” is any “securities account” as defined m the Code with such additions to such term as may hereafter be made.

“Settlement Date” is defined in Section 2.1.4.

“Stock Pledge Agreement” is that certain Stock Pledge Agreement, dated the Effective Date, from Borrower for the benefit of Bank.

“Streamline Period” shall mean any time that Borrower maintains not less than Five Million Dollars ($5,000,000) in cash at Bank or Bank’s Affiliates.

“Subordinated Debt” is indebtedness incurred by Borrower subordinated to all of Borrower’s now or hereafter indebtedness to Bank (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Bank entered into between Bank and the other creditor), on terms acceptable to Bank.

“Subsidiary” is, as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person. Unless the context otherwise requires, each reference to a Subsidiary herein shall be a reference to a Subsidiary of Borrower.

46.

“Trademarks” means any trademark and servicemark rights, whether registered or not, applications to register and registrations of the same and like protections, and the entire goodwill of the business of Borrower connected with and symbolized by such trademarks.

“Tranche A” is defined in Section 2.1.1(a).

“Tranche A Advance” is defined in Section 2.1.1(a).

“Tranche B” is defined in Section 2.1.1(a).

“Tranche B Advance” and “Tranche B Advances” are defined in Section 2.1.1(a).

“Tranche B Advance Milestone” means the date on which Bank receives and approves evidence satisfactory to Bank that (i) Borrower has received, on or after the Effective Date, at least Fifteen Million Dollars ($15,000,000) in net proceeds from its Series G round of preferred equity financing (and including the issuance of convertible notes to existing investors), on terms acceptable to Bank in its sole discretion, and (ii) Borrower’s actual total revenue for the fiscal quarter ending May 31, 2010 is greater than or equal to seventy percent (70%) of the forecasted total revenue for the fiscal quarter ending May 31, 2010 (based on the June 1, 2010 projections plan previously delivered to Bank).

“Tranche B Draw Period” is the period of time from January 15, 2011 through the earlier to occur of (a) June 30, 2012 or (b) an Event of Default.

“Transaction Report” is that certain report of transactions and schedule of collections in the form attached hereto as Exhibit C.

“Transfer” is defined in Section 7.1.

“Warrant” is that certain Warrant to Purchase Stock dated as of the Effective Date executed by Borrower in favor of Bank.

[Signature page follows.]

47.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the Effective Date.

BORROWER:

EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	President & CEO
BANK
SILICON VALLEY BANK
By:	/s/ Matthew Wright
Name:	Matthew Wright
Title:	RM

[Signature Page to Loan and Security Agreement]

EXHIBIT A

COLLATERAL DESCRIPTION

The Collateral consists of all of Borrower’s right, title and interest in and to the following personal property:

All goods, Accounts (including health-care receivables), Equipment, Inventory, contract rights or rights to payment of money, leases, license agreements, franchise agreements, General Intangibles (except as provided below), commercial tort claims, documents, instruments (including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts, fixtures, letters of credit rights (whether or not the letter of credit is evidenced by a writing), securities, and all other investment property, supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever located; and

all Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing.

Notwithstanding the foregoing, the Collateral does not include (a) any Intellectual Property; provided, however, the Collateral shall include all Accounts and all proceeds of Intellectual Property; or (b) property that constitutes the capital stock of a controlled foreign corporation (as such term is defined in the Internal Revenue Code of 1986, as amended) in excess of sixty-five percent (65%) of the voting power of all classes of capital stock of such controlled foreign corporation entitled to vote. If a judicial authority (including a U.S. Bankruptcy Court) would hold that a security interest in the underlying Intellectual Property is necessary to have a security interest in such Accounts and such property that are proceeds of Intellectual Property, then the Collateral shall automatically, and effective as of the Effective Date, include the Intellectual Property to the extent necessary to permit perfection of Bank’s security interest in such Accounts and such other property of Borrower that are proceeds of the Intellectual Property.

Pursuant to the terms of a certain negative pledge arrangement with Bank, Borrower has agreed not to encumber any of its Intellectual Property without Bank’s prior written consent.

Exhibit A – Page 1

EXHIBIT B

COMPLIANCE CERTIFICATE

TO: SILICON VALLEY BANK	Date:
FROM: EASIC CORPORATION

The undersigned authorized officer of eASIC 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 5.9 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 (“CC”)	Monthly within 30 days	Yes No
Annual financial statement (Company Prepared)	FYE within 30 days	Yes No
Annual financial statement (CPA Audited) + CC	FYE within 180 days	Yes No
Annual Board-Approved financial projections	Annually within 10 days of approval	Yes No
Transaction Reports	Weekly at all times that any Advances are outstanding	Yes No
Statements of Cash Balances at Foreign Deposit Accounts	Monthly within 30 days	Yes No
10-Q, 10-K and 8-K	Within 5 days after filing with SEC	Yes No
Borrowing Base Certificate A/R & A/P Agings	Monthly within 30 days	Yes No

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

[Signatures Appear on the Following Page]

Exhibit B – Page 1

EASIC CORPORATION

By:

Name:

Title:

BANK USE ONLY

Received by:
	AUTHORIZED SIGNER

Date:

Verified:
	AUTHORIZED SIGNER

Date:

Compliance Status: Yes No

Exhibit B – Page 2

EXHIBIT D

LOAN PAYMENT/ADVANCE REQUEST FORM

DEADLINE FOR SAME DAY PROCESSING IS NOON PACIFIC TIME

Fax To: Date:

Loan Payment:

From Account#
	(Deposit Account #)

Principal $

Authorized Signature:

Print Name/Title:

EASIC CORPORATION

To Account#
	(Loan Account#)

and/or Interest$

Phone Number:

GROWTH CAPITAL ADVANCE:

Complete Outgoing Wire Request section below if all or a portion of the funds from this growth capital loan advance are for an outgoing wire.

From Account#	To Account#
(Loan Account#)		(Deposit Account #)

Amount of Growth Capital Advance$

All Borrower’s representations and warranties in the Loan and Security Agreement are true, correct and complete in all material respects on the date of the request for a growth capital advance; 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:

Authorized Signature: Phone Number:

Print Name/Title:

OUTGOING WIRE REQUEST:

Complete only if all or a portion of funds from the growth capital loan advance above is to be wired.

Deadline for same day processing is noon, Pacific Time

Beneficiary Name:	Amount of Wire:$
Beneficiary Bank:	Account Number:
City and State:

Beneficiary Bank Transit (ABA)#:	Beneficiary Bank Code (Swift, Sort, Chip, etc.):
(For International Wire Only)

Intermediary Bank: Transit (ABA)#:

For Further Credit to:

Special Instruction:

By signing below, I (we) acknowledge and agree that my (our) funds transfer request shall be processed in accordance with and subject to the terms and conditions set forth in the agreements(s) covering funds transfer service(s), which agreements{s) were previously received and executed by me (us).

Authorized Signature:

Print Name/Title:

Telephone#:

2^nd Signature (if required):

Print Name/Title:

Telephone#:

Exhibit D – Page 1

EXHIBIT E

BORROWING RESOLUTIONS

Exhibit E – Page 1

Silicon Valley Bank

CORPORATE BORROWING CERTIFICATE

BORROWER:	EASIC CORPORATION	DATE: September 22, 2010
BANK:	SILICON VALLEY BANK

I hereby certify as follows, as of the date set forth above:

1. I am the Secretary, Assistant Secretary or other officer of the Borrower. My title is as set forth below.

2. Borrower’s exact legal name is set forth above. Borrower is a corporation existing under the laws of the State of Delaware.

3. Attached hereto are true, correct and complete copies of Borrower’s Articles/Certificate of Incorporation (including amendments), as filed with the Secretary of State of the state in which Borrower is incorporated as set forth in paragraph 2 above. Such Articles/Certificate of Incorporation have not been amended, annulled, rescinded, revoked or supplemented, and remain in full force and effect as of the date hereof.

4. The following resolutions were duly and validly adopted by Borrower’s Board of Directors at a duly held meeting of such directors (or pursuant to a unanimous written consent or other authorized corporate action). Such resolutions are in full force and effect as of the date hereof and have not been in any way modified, repealed, rescinded, amended or revoked, and Bank may rely on them until Bank receives written notice of revocation from Borrower.

RESOLVED, that any one of the following officers or employees of Borrower, whose names, titles and signatures are below, may act on behalf of Borrower:

Name	Title	Signature	Authorized to Add or Remove Signatories
Ronnie Vasishta	President/CEO	/s/ Ronnie Vasishta	x
			¨
			¨
			¨

RESOLVED FURTHER, that any one of the persons designated above with a checked box beside his or her name may, from time to time, add or remove any individuals to and from the above list of persons authorized to act on behalf of Borrower.

2.

RESOLVED FURTHER, that such individuals may, on behalf of Borrower:

Borrow Money. Borrow money from Silicon Valley Bank (“Bank”).

Execute Loan Documents. Execute any loan documents Bank requires.

Grant Security. Grant Bank a security interest in any of Borrower’s assets.

Negotiate Items. Negotiate or discount all drafts, trade acceptances, promissory notes, or other indebtedness in which Borrower has an interest and receive cash or otherwise use the proceeds.

Letters of Credit. Apply for letters of credit from Bank

Foreign Exchange Contracts. Execute spot or forward foreign exchange contracts.

Issue Warrants. Issue warrants for Borrower’s capital stock.

Further Acts. Designate other individuals to request advances, pay fees and costs and execute other documents or agreements (including documents or agreement that waive Borrowers right to a jury trial) they believe to be necessary to effectuate such resolutions.

RESOLVED FURTHER, that all acts authorized by the above resolutions and any prior acts relating thereto are ratified.

5. The persons listed above are Borrower’s officers or employees with their titles and signatures shown next to their names.

By: /s/ Larry Borras

Name: Larry Borras

Title: Secretary

*** If the Secretary, Assistant Secretary or other certifying officer executing above is designated by the resolutions set forth in paragraph 4 as one of the authorized signing officers, this Certificate must also be signed by a second authorized officer or director of Borrower.

I, the                                                               of Borrower, hereby certify as to paragraphs 1 through 5 above, as of the date set forth above.

By:

Name:

Title:

3.

FIRST AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 20^th day of January, 2011, by and between SILICON VALLEY BANK (“Bank’) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITAL

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of September 29, 2010 (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 “Tranche B Advance Milestone”, 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.

2.1 Section 13 (Definitions).

(a) The following term and definition set forth in Section 13.1 of the Loan Agreement is amended in its entirety and replaced with the following:

“Tranche B Advance Milestone” means the date on which Bank receives and approves evidence satisfactory to Bank that (i) Borrower has received, on or after the Effective Date, at least Fifteen Million Dollars ($15,000,000) in net proceeds from its Series G round of preferred equity Financing (and including the issuance of convertible notes to existing investors), on terms acceptable to Bank in its sole discretion, and (ii) Borrower’s actual total revenue for the Testing Fiscal Quarter is greater than or equal to seventy percent (70%) of the forecasted total revenue for the Testing Fiscal Quarter (based on the August 6, 2010 projections plan previously delivered to Bank),

1.

(b) The following term and its definition is hereby added, in proper alphabetical order, to Section 13.l of the Loan Agreement:

“Testing Fiscal Quarter” means the Borrower’s most recent fiscal quarter immediately prior to Borrower’s request for a Tranche B Advance.

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 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 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;

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,

2.

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.

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 Bank of this Amendment by each party hereto.

[Signature page follows.]

3.

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/ Matthew Wright
Name:	Matthew Wright
Title:	RM
BORROWER
EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	President/CEO

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

SECOND AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 28^th day of September, 2012, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITALS

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of September 29, 2010, as amended by that certain First Amendment to Loan and Security Agreement dated as of January 20, 2011 by and between Bank and Borrower (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 (i) extend the Revolving Line Maturity Date, 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 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 13 (Definitions). The following term and definition set forth in Section 13.1 of the Loan Agreement is amended in its entirety and replaced with the following:

“Revolving Line Maturity Date” is December 28, 2012.

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.

1.

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 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 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;

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.

2.

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 (a) the due execution and delivery to Bank of this Amendment by each party hereto, (b) Borrower’s payment of a non-refundable amendment fee in the amount of Three Thousand Seven Hundred Fifty Dollars ($3,750), and (c) payment of Bank’s legal fees and expenses in connection with the negotiation and preparation of this Amendment.

[Signature page follows.]

3.

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/ Matthew Wright
Name:	Matthew Wright
Title:	RM
BORROWER
EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	CEO

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

THIRD AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 2^nd day of January, 2013, but effective as of December 28^th 2012, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITAL

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of September 29, 2010, as amended by that certain First Amendment to Loan and Security Agreement dated as of January 20, 2011 by and between Bank and Borrower, and as amended by that certain Second Amendment to Loan and Security Agreement dated as of September 28, 2012 by and between Bank and Borrower (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 (i) extend the Revolving Line Maturity Date, 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.

2.1 Section 13 (Definitions). The following term and definition set forth in Section 13.1 of the Loan Agreement is amended in its entirety and replaced with the following:

“Revolving Line Maturity Date” is January 31, 2013.

1.

3. Limitation of Amendments.

3.1 The amendment set forth in Section 2, above, is 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 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 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;

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

2.

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.

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 (a) the due execution and delivery to Bank of this Amendment by each party hereto, (b) Borrower’s payment of a non-refundable amendment fee in the amount of One Thousand Two Hundred Fifty Dollars ($1,250), and (c) payment of Bank’s legal fees and expenses in connection with the negotiation and preparation of this Amendment.

[Signature page follows.]

3.

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/ Matthew Wright
Name:	Matthew Wright
Title:
BORROWER
EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	CEO

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

FOURTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS FOURTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 15 day of February, 2013, but effective as of January 31, 2013, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITALS

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of September 29, 2010, as amended by that certain First Amendment to Loan and Security Agreement dated as of January 20, 2011 by and between Bank and Borrower, as amended by that certain Second Amendment to Loan and Security Agreement dated as of September 28, 2012 by and between Bank and Borrower, and as amended by that certain Third Amendment to Loan and Security Agreement dated January 2, 2013, but effective as of December 28, 2012 by and between Bank and Borrower (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 (i) extend the Revolving Line Maturity Date, 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.

2.1 Section 13 (Definitions). The following term and definition set forth in Section 13.1 of the Loan Agreement is amended in its entirety and replaced with the following:

“Revolving Line Maturity Date” is April 30, 2013.

1.

3. Limitation of Amendment.

3.1 The amendment set forth in Section 2, above, is 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 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 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;

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

2.

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.

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 (a) the due execution and delivery to Bank of this Amendment by each party hereto, (b) Borrower’s payment of a non-refundable amendment fee in the amount of Three Thousand Seven Hundred Fifty Dollars ($3,750), and (c) payment of Bank’s legal fees and expenses in connection with the negotiation and preparation of this Amendment.

[Signature page follows.]

3.

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/ Matthew Wright
Name:	Matthew Wright
Title:	RM
BORROWER:
EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	CEO

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

FIFTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS FIFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 6^th day of May, 2013, but effective as of April 30, 2013, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITALS

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of September 29, 2010, as amended by that certain First Amendment to Loan and Security Agreement dated as of January 20, 2011 by and between Bank and Borrower, as amended by that certain Consent Agreement dated April 29, 2011 by and between Bank and Borrower, as amended by that certain Second Amendment to Loan and Security Agreement dated as of September 28, 2012 by and between Bank and Borrower, as amended by that certain Third Amendment to Loan and Security Agreement dated January 2, 2013, but effective as of December 28, 2012 by and between Bank and Borrower, and as amended by that certain Fourth Amendment to Loan and Security Agreement dated February 15, 2013, but effective as of January 31, 2013 by and between Bank and Borrower (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 contemplates obtaining a secured term loan (the “Silver Lake Loan”) from Silver Lake Waterman Fund, L.P., a Delaware limited partnership, in its capacity as agent and as lender (“Silver Lake”), in an aggregate principal amount of Fifteen Million Dollars ($15,000,000) (the “Silver Lake Loan Maximum”).

D. Borrower has requested that Bank (a) consent to the Silver Lake Loan and (b) amend the Loan Agreement to (i) extend the Revolving Line Maturity Date, and (ii) make certain other revisions to the Loan Agreement as more fully set forth herein.

E. Although Bank is under no obligation to do so, Bank is willing to consent to the Silver Lake Loan and amend certain provisions of the Loan Agreement as more fully set forth herein, 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.

1.

2. Silver Lake Loan.

2.1 Consent. Subject to the express terms of Section 7 and 8 below, Bank hereby (a) consents to the Silver Lake Loan, (b) agrees that the Silver Lake Loan shall constitute “Permitted Indebtedness” under the Loan Agreement to the extent the aggregate principal amount advanced under the Silver Lake Loan does not exceed the Silver Lake Loan Maximum, and (c) agrees that the Lien in favor of Silver Lake to secure the Silver Lake Loan shall be considered a “Permitted Lien” under the Loan Agreement to the extent the aggregate principal amount secured thereby does not exceed the Silver Lake Loan Maximum. The consent set forth in this Section shall not be deemed or otherwise construed to constitute a consent or waiver of any provisions of the Loan Agreement or any other Loan Document in connection with any other transaction other than as specifically set forth in this Amendment.

2.2 Covenants and Defaults. Bank and Borrower hereby acknowledge and agree that (a) Borrower shall not amend, modify or supplement any of the Silver Lake Loan Documents (as hereinafter defined) in a manner which would (i) increase the principal amount of Silver Lake Loan, (ii) increase any applicable interest rate with respect to the Silver Lake Loan by more than 200 basis points (excluding increases based solely on (A) changes to the prime rate or any other index and (B) the imposition of the default rate of interest in accordance with the Silver Lake Loan Documents), (iii) change the terms of principal or interest repayment with respect to the Silver Lake Loan, (iv) change the payment schedule with respect to the Silver Lake Loan, (v) add express conditions that directly restrict the payment of the Obligations, (vi) change the maturity date with respect to the Silver Lake Loan from that set forth in the Silver Lake Loan Documents in effect as of the Silver Lake Loan Documents Execution Date (as defined below), or (vii) change the definition of Collateral set forth in the Silver Lake Loan Documents from the definition in effect as of the Silver Lake Loan Documents Execution Date (as defined below); (b) the occurrence of a default under the Silver Lake Loan Documents (if such default is not waived, or otherwise cured within any applicable grace period provided therein) shall be an Event of Default under the Loan Agreement; and (c) any breach of the Silver Lake Subordination Agreement (as hereinafter defined) by Silver Lake shall be an Event of Default under the Loan Agreement (if such breach is not otherwise cured within any applicable grace period).

3. Amendments to Loan Agreement.

3.1 Execution of Silver Lake Loan Documents; Payoff of Indebtedness under Gold Hill Loan. Provided that Borrower and Silver Lake have fully executed the Silver Lake Loan Documents and such Silver Lake Loan Documents are in full force and effect (the date on which the Silver Lake Loan Documents have been fully executed being called, the “Silver Lake Loan Documents Execution Date”), Bank and Borrower agree that Borrower shall pay all, but not less than all, of the Indebtedness owing to Gold Hill under the Gold Hill Loan (the “Gold Hill Payoff”) on the date that is one (1) day immediately prior to the day on which the funding of the Silver Lake Loan occurs, resulting in Borrower’s receipt of at least Ten Million Dollars ($10,000,000) in the first tranche of the Silver Lake Loan.

3.2 Payoff of Obligations Related to Growth Capital Advances. Notwithstanding anything to the contrary in the Loan Agreement, on a date not later than one hundred twenty (120) days after the Silver Lake Loan Documents Execution Date, Bank and

2.

Borrower agree that Borrower shall prepay all, but not less than all, of (A) all accrued and unpaid interest with respect to the Growth Capital Advances through the date the prepayment is made; (B) all unpaid principal with respect to the Growth Capital Advances; (C) the Final Payment and (D) all other sums relating to the Growth Capital Advances, if any, that shall have become due and payable under the Loan Agreement.

3.3 Section 13 (Definitions). The following term and definition set forth in Section 13.1 of the Loan Agreement is amended in its entirety and replaced with the following:

“Revolving Line Maturity Date” is June 14, 2013.

4. Limitation of Consent and Amendments.

4.1 The consent set forth in Section 2 and 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.

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.

4.3 In addition to those Events of Default specifically enumerated in the Loan Documents, the failure to comply with the terms of any covenant or agreement contained herein shall constitute an Event of Default and shall entitle the Bank to exercise all rights and remedies provided to the Bank under the terms of any of the other Loan Documents as a result of the occurrence of the same.

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;

3.

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;

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; and

5.8 True, complete and correct copies of all of the documents relating to, evidencing or securing the Silver Lake Loan the Silver Lake Loan, including all amendments, supplements and other modifications thereto (the “Silver Lake Loan Documents”) will be delivered in accordance with Section 8 of this Amendment, and attached as Exhibit A.

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 on April 30, 2013 upon (a) the due execution and delivery to Bank of this Amendment by each party hereto, (b) Borrower’s payment of a non-refundable amendment fee in the amount of One Thousand Eight Hundred Seventy-Five Dollars ($1,875), and (c) payment of Bank’s legal fees and expenses in connection with the negotiation and preparation of this Amendment.

8. Post-Closing Matters. Borrower shall deliver to Bank within one (1) Business Day of the Silver Lake Loan Documents Execution Date (i) copies of the Silver Lake Loan Documents, and (b) the Subordination Agreement substantially in the form attached hereto as Schedule 1, duly executed by Silver Lake (the “Silver Lake Subordination Agreement”). Following the Silver Lake Loan Documents Execution Date, Borrower shall promptly pay Bank’s legal fees and expenses in connection with the negotiation and preparation of the Silver Lake Subordination Agreement, and the review of the Silver Lake Loan Documents.

[Signature page follows.]

4.

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/ Matthew Wright
Name:	Matthew Wright
Title:	VP
BORROWER:
EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	President & CEO

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

SIXTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS SIXTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 14th day of June, 2013, but effective as of June 14, 2013, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITALS

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated September 29, 2010, as amended by that certain First Amendment to Loan and Security Agreement dated January 20, 2011 by and between Bank and Borrower, as amended by that certain Consent Agreement dated April 29, 2011 by and between Bank and Borrower, as amended by that certain Second Amendment to Loan and Security Agreement dated September 28, 2012 by and between Bank and Borrower, as amended by that certain Third Amendment to Loan and Security Agreement dated January 2, 2013, but effective as of December 28, 2012 by and between Bank and Borrower, as amended by that certain Fourth Amendment to Loan and Security Agreement dated February 15, 2013, but effective as of January 31, 2013 by and between Bank and Borrower, and as amended by that certain Fifth Amendment to Loan and Security Agreement dated May 6, 2013, but effective as of April 30, 2013 (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 (i) extend the Revolving Line Maturity Date, and (ii) make certain other revisions to the Loan Agreement as more fully set forth herein.

D. Although Bank is under no obligation to do so, Bank is willing to amend certain provisions of the Loan Agreement as more fully set forth herein, 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. Amendment to Loan Agreement.

2.1 Section 13 (Definitions). The definition of “Revolving Line Maturity Date” set forth in Section 13.1 of the Loan Agreement is hereby amended in its entirety and replaced with the following:

“Revolving Line Maturity Date” is July 28, 2013.

3. Limitation of Amendment.

3.1 The amendment set forth in Section 2, above, is 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 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 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;

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;

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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.

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 as of June 14, 2013 upon (a) the due execution and delivery to Bank of this Amendment by each party hereto, (b) Borrower’s payment of a non-refundable amendment fee in the amount of One Thousand Eight Hundred Seventy-Five Dollars ($1,875), and (c) payment of Bank’s legal fees and expenses in connection with the negotiation and preparation of this Amendment.

[Signature page follows.]

3

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/ Matthew Wright
Name:	Matthew Wright
Title:
BORROWER:
EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	President & CEO

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

SEVENTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS SEVENTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 19th day of July, 2013, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITALS

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated September 29, 2010, as amended by that certain First Amendment to Loan and Security Agreement dated January 20, 2011 by and between Bank and Borrower, as amended by that certain Consent Agreement dated April 29, 2011 by and between Bank and Borrower, as amended by that certain Second Amendment to Loan and Security Agreement dated September 28, 2012 by and between Bank and Borrower, as amended by that certain Third Amendment to Loan and Security Agreement dated January 2, 2013, but effective as of December 28, 2012 by and between Bank and Borrower, as amended by that certain Fourth Amendment to Loan and Security Agreement dated February 15, 2013, but effective as of January 31, 2013 by and between Bank and Borrower, as amended by that certain Fifth Amendment to Loan and Security Agreement dated May 6, 2013, but effective as of April 30, 2013, and as amended by that certain Sixth Amendment to Loan and Security Agreement dated June 14, 2013 (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 (i) extend the Revolving Line Maturity Date, and (ii) make certain other revisions to the Loan Agreement as more fully set forth herein.

D. Although Bank is under no obligation to do so, Bank is willing to amend certain provisions of the Loan Agreement as more fully set forth herein, 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.

1.

2. Amendment to Loan Agreement.

2.1 Section 13 (Definitions). The definition of “Revolving Line Maturity Date” set forth in Section 13.1 of the Loan Agreement is amended in its entirety and replaced with the following:

“Revolving Line Maturity Date” is September 27, 2013.

3. Limitation of Amendment.

3.1 The amendment set forth in Section 2, above, is 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 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 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;

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;

2.

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.

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 (a) the due execution and delivery to Bank of this Amendment by each party hereto, (b) Borrower’s payment of a non-refundable amendment fee in the amount of Two Thousand Five Hundred Dollars ($2,500), and (c) payment of Bank’s legal fees and expenses in connection with the negotiation and preparation of this Amendment.

[Signature page follows.]

3.

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/ Ryan Edwards
Name:	Ryan Edwards
Title:	VP
BORROWER:
EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	President & CEO

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

EIGHTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS EIGHTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 30th day of September, 2013, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITALS

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of September 29, 2010 (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 contemplates obtaining a secured term loan from Horizon Technology Finance Corporation, a Delaware corporation (“Horizon”), in its capacity as collateral agent and as lender and DBD Credit Funding LLC, a Delaware limited liability company (“DBD”), in its capacity as a lender (such secured term loan being called, the “Horizon/DBD Loan”), in an aggregate principal amount of Six Million Dollars ($6,000,000) (the “Horizon/DBD Loan Maximum”).

D. Borrower has requested that Bank (a) consent to the Horizon/DBD Loan and (b) amend the Loan Agreement to (i) increase the Revolving Line, (ii) extend the Revolving Line Maturity Date, and (iii) make certain other revisions to the Loan Agreement as more fully set forth herein.

E. Although Bank is under no obligation to do so, Bank is willing to consent to the Horizon/DBD Loan and amend certain provisions of the Loan Agreement as more fully set forth herein, 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. Horizon/DBD Loan.

2.1 Consent. Subject to the express terms of Section 7 below, Bank hereby (a) consents to the Horizon/DBD Loan, (b) agrees that the Horizon/DBD Loan shall constitute “Permitted Indebtedness” under the Loan Agreement (pursuant to the terms of the Horizon/DBD

1.

Subordination Agreement (as defined below)) to the extent the aggregate principal amount advanced under the Horizon/DBD Loan does not exceed the Horizon/DBD Loan Maximum, and (c) agrees that the Liens in favor of Horizon, in its capacity as collateral agent and as lender, and DBD, in its capacity as a lender, to secure the Horizon/DBD Loan shall be considered a “Permitted Lien” under the Loan Agreement (pursuant to the terms of the Horizon/DBD Subordination Agreement) to the extent the aggregate principal amount secured thereby does not exceed the Horizon/DBD Loan Maximum. The consent set forth in this Section shall not be deemed or otherwise construed to constitute a consent or waiver of any provisions of the Loan Agreement or any other Loan Document in connection with any other transaction other than as specifically set forth in this Amendment.

2.2 Horizon/DBD Subordination Agreement. Borrower has read, reviewed and approved all of the terms of the Horizon/DBD Subordination Agreement. Bank and Borrower hereby agree that the Horizon/DBD Subordination Agreement shall be included in the term “Loan Documents” as defined in the Loan Agreement.

2.3 Covenants and Defaults. Bank and Borrower hereby acknowledge and agree that (a) Borrower shall not amend, modify or supplement any of the Horizon/DBD Loan Documents (as hereinafter defined) in a manner which would (i) increase the principal amount of Horizon/DBD Loan, (ii) increase any applicable interest rate with respect to the Horizon/DBD Loan by more than 200 basis points (excluding increases based solely on (A) changes to the prime rate or any other index and (B) the imposition of the default rate of interest in accordance with the Horizon/DBD Loan Documents), (iii) change the terms of principal or interest repayment with respect to the Horizon/DBD Loan, (iv) change the payment schedule with respect to the Horizon/DBD Loan, (v) add express conditions that directly restrict the payment of the Obligations, (vi) change the maturity date with respect to the Horizon/DBD Loan from that set forth in the Horizon/DBD Loan Documents in effect as of the Horizon/DBD Loan Documents Execution Date (as defined below), or (vii) change the definition of Collateral set forth in the Horizon/DBD Loan Documents from the definition in effect as of the Horizon/DBD Loan Documents Execution Date (as defined below); (b) the occurrence of a default under the Horizon/DBD Loan Documents (if such default is not waived, or otherwise cured within any applicable grace period provided therein) shall be an Event of Default under the Loan Agreement; and (c) any breach of the Horizon/DBD Subordination Agreement by Horizon and/or DBD shall be an Event of Default under the Loan Agreement (if such breach is not otherwise cured within any applicable grace period).

3. Amendments to Loan Agreement.

3.1 Payoff of Indebtedness under Gold Hill Loan. Bank and Borrower agree that Borrower shall use the proceeds of the first tranche of the Horizon/DBD Loan to pay all, but not less than all, of the Indebtedness owing to Gold Hill under the Gold Hill Loan (the “Gold Hill Payoff”).

3.2 Payoff of Obligations Related to Growth Capital Advances. Notwithstanding anything to the contrary in the Loan Agreement, Bank and Borrower agree that Borrower shall use the proceeds of the first tranche of the Horizon/DBD Loan to prepay all, but not less than all, of (A) the Growth Capital Advances; (B) all accrued and unpaid interest with

2.

respect to the Growth Capital Advances through the date the prepayment is made; (C) all unpaid principal with respect to the Growth Capital Advances; (D) the Final Payment and (E) all other sums relating to the Growth Capital Advances, if any, that shall have become due and payable under the Loan Agreement.

3.3 Section 6.6 (Access to Collateral; Books and Records). The second sentence of Section 6.6 of the Loan Agreement is hereby amended by deleting such sentence in its entirety, and replacing it with the following:

Provided no Event of Default has occurred and is continuing, such audits shall be conducted no more than once every six (6) months.

3.4 Section 6.12 (Financial Covenants). Section 6 of the Loan Agreement is hereby amended by adding Section 6.12 to the Loan Agreement immediately after Section 6.11 of the Loan Agreement as follows:

6.12 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:

(a) Minimum Revenue. Commencing with the quarter ending September 30, 2013, and as of the last day of each quarter thereafter, total gross revenue, measured on a cumulative basis for period then ended, of at least the following amounts at the following times:

Quarter Ending	Minimum Revenue
September 30, 2013	$6,240,000
December 31, 2013	$8,122,000
March 31, 2014	$10,400,000
June 30, 2014	$10,800,000
September 30, 2014	$11,200,000
December 31, 2014	$11,600,000
March 31, 2015 and thereafter	To be determined based on Borrower’s FY 2015 board- approved plan*

* Notwithstanding the foregoing, Bank shall establish the applicable minimum revenue financial covenant for the quarter ending on March 31, 2015 and each subsequent quarter ending during Borrower’s fiscal year 2015 based

3.

upon Borrower’s board-approved plan for the fiscal year ending December 31, 2015, delivered in accordance with Section 6.2, and such covenant shall be set in a manner (but not in amounts) consistent with the covenant set as of September 30, 2013 through the quarter ending on December 31, 2014.

3.5 Section 12.1 (Termination Prior to Revolving Line Maturity Date). Section 12.1 of the Loan Agreement is hereby amended in its entirety by adding the following sentence immediately at the end of such Section:

If such termination is at Borrower’s election or at Bank’s election due to the occurrence and continuance of an Event of Default, Borrower shall pay to Bank, in addition to the payment of any other expenses or fees then-owing, a termination fee in an amount equal to Seventy-Five Thousand Dollars ($75,000), provided, that no termination fee shall be charged if the credit facility hereunder is replaced with a new facility from another division of Bank.

3.6 Section 13 (Definitions).

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

“Revolving Line” is an Advance or Advances in an amount equal to Five Million Dollars ($5,000,000).

“Revolving Line Maturity Date” is September 30, 2015.

(b) The definition of “Eligible Accounts” set forth in Section 13.1 of the Loan Agreement is hereby amended by deleting clauses (e) and (v) in their entirety and replacing them with the following:

(e) Accounts owing from an Account Debtor which does not have its principal place of business in the United States unless such Accounts are: (a) otherwise Eligible Accounts, and such Account is approved by Bank in writing, in its sole discretion, on a case-by-case basis, or (b) Eligible Foreign Accounts;

(v) Accounts owing from an Account Debtor, whose total obligations to Borrower exceed thirty percent (30.0%) of all Accounts, except for (i) Ericsson for which such percentage is seventy percent (70.0%), and (ii) Seagate for which such percentage is sixty percent (60.0%), for the amounts that exceed that percentage, unless Bank approves in writing; and

(c) Section 13.1 of the Loan Agreement is hereby amended to add the following term and definition in the appropriate order to preserve the alphabetical listing of the term in such section:

“Eligible Foreign Accounts” are Accounts for which the Account Debtor does not have its principal place of business in the United States and which (a) otherwise satisfy the definition of Eligible Accounts and (b) are due and owing from any of the

4.

following Account Debtors: (i) Jabil Circuits, (ii) Arm Ltd., (iii) Ericsson, (iv) Texas Instruments, (v) Flextronics, (vi) Seagate, (vii) Innotech, (viii) Nanjing Ericsson Panda Communications Company Ltd., (ix) Beyonics Technology (SENAI) Sdn Bhd, (x) Beyonics Technology Electronics (Suzhou) Co. Ltd., (xi) Cal-Comp Electronics, and (xii) Shenzen Kaifa Technology.

3.7 Exhibit B (Compliance Certificate). The Compliance Certificate attached to the Loan Agreement as Exhibit B is replaced in its entirety with the Compliance Certificate attached hereto as Exhibit B. From and after the date hereof, all references in the Loan Agreement to the Compliance Certificate shall mean the Compliance Certificate in the form attached hereto as Exhibit B.

4. Limitation of Consent and Amendments.

4.1 The consent set forth in Section 2 and 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.

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.

4.3 In addition to those Events of Default specifically enumerated in the Loan Documents, the failure to comply with the terms of any covenant or agreement contained herein shall constitute an Event of Default and shall entitle the Bank to exercise all rights and remedies provided to the Bank under the terms of any of the other Loan Documents as a result of the occurrence of the same.

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.

5.3 The organizational documents of Borrower delivered to Bank on the Effective Date and on September 26, 2013 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;

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; and

5.8 Attached as Schedule 1 are true, complete and correct copies of all of the documents relating to, evidencing or securing the Horizon/DBD Loan the Horizon/DBD Loan, including all amendments, supplements and other modifications thereto (the “Horizon/DBD 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 (a) the due execution and delivery to Bank of this Amendment by each party hereto, (b) Borrower’s payment of a non-refundable renewal fee in the amount of Twenty-Five Thousand Dollars ($25,000), (c) Bank’s receipt of the Horizon/DBD Loan Documents, (c) Bank’s receipt of the Subordination Agreement substantially in the form attached hereto as Schedule 2 and dated as of even date herewith, duly executed and delivered by Borrower, Horizon and DBD (the “Horizon/DBD Subordination Agreement”) and (d) payment of Bank’s legal fees and expenses in connection with the negotiation and preparation of this Amendment, the Horizon/DBD Subordination Agreement and the review of the Horizon/DBD Loan Documents.

[Signature page follows.]

6.

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/ Matthew Wright
Name:	Matthew Wright
Title:	VP
BORROWER:
EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	09-26-2013

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

EXHIBIT B

COMPLIANCE CERTIFICATE

TO:	SILICON VALLEY BANK	Date:
FROM:	EASIC CORPORATION

The undersigned authorized officer of eASIC 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 5.9 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 (“CC”)	Monthly within 30 days	Yes        No
Annual financial statement (Company Prepared)	FYE within 30 days	Yes        No
Annual financial statement (CPA Audited) + CC	FYE within 180 days	Yes        No
Annual Board-Approved financial projections	Annually within 10 days of approval	Yes        No
Transaction Reports	Weekly at all times that any Advances are outstanding	Yes        No
Statements of Cash Balances at Foreign Deposit Accounts	Monthly within 30 days	Yes        No
10-Q, 10-K and 8-K	Within 5 days after filing with SEC	Yes        No
Borrowing Base Certificate A/R & A/P Agings	Monthly within 30 days	Yes        No

Financial Covenant	Required	Actual	Complies
Maintain on a Quarterly Basis:
Minimum Revenue
September 30, 2013	$6,240,000	$	Yes        No
December 31, 2013	$8,122,000	$	Yes        No

Exhibit B – Page 1

March 31, 2014	$10,400,000	$	Yes        No
June 30, 2014	$10,800,000	$	Yes        No
September 30, 2014	$11,200,000	$	Yes        No
December 31, 2014	$11,600,000	$	Yes        No
March 31, 2015	To be determined based on Borrower’s FY 2015 board-approved plan	$	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.

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

EASIC CORPORATION

By:

Name:

Title:

BANK USE ONLY

Received by:
	AUTHORIZED SIGNER

Date:

Verified:
	AUTHORIZED SIGNER

Date:

Compliance Status: Yes No

2.

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:                                                          

Minimum Revenue (Section 6.12(a))

Required: Commencing with the quarter ending September 30, 2013, and as of the last day of each quarter thereafter, total gross revenue, measured on a cumulative basis for period then ended, of at least the following amounts at the following times:

Quarter Ending	Minimum Revenue
September 30, 2013	$6,240,000
December 31, 2013	$8,122,000
March 31, 2014	$10,400,000
June 30, 2014	$10,800,000
September 30, 2014	$11,200,000
December 31, 2014	$11,600,000
March 31, 2015 and thereafter	To be determined based on Borrower’s FY 2015 board-approved plan

Actual:                                                          

A. Total gross revenue for the quarter then ended on a cumulative basis $                

Is line A equal to or greater than the required amount above?

                     No, not in compliance                      Yes, in compliance

Exhibit B – Page 1

NINTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS NINTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this _1^st_ day of July, 2014, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITALS

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of September 29, 2010 (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 (i) increase the Revolving Line, (ii) increase the Advance Rate, (iii) adjust the minimum revenue financial covenant set forth in Section 6.12 of the Loan Agreement, and (iv) make certain other revisions to the Loan Agreement as more fully set forth herein.

D. Although Bank is under no obligation to do so, Bank is willing to amend certain provisions of the Loan Agreement as more fully set forth herein, 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 2012 and 2013 Audited Financial Statements. Notwithstanding the requirements of Section 6.2(g) of the Loan Agreement to the contrary, Borrower shall deliver to Bank its audited financial statements for fiscal years ended December 31, 2012 and December 31, 2013 on or before December 31, 2014.

2.2 Section 2.1 (Promise to Pay). Section 2.1 of the Loan Agreement is amended by deleting Sections 2.1.3 (Letters of Credit Sublimit), 2.1.4 (Foreign Exchange Sublimit) and 2.1.5 (Cash Management Services Sublimit) thereof in their entirety and marking them “Reserved.”

1.

2.3 Section 2.2 (Overadvances). Section 2.2 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

2.2 (Overadvances). If, at any time, the outstanding principal amount of any Advances exceeds the lesser of either the Revolving Line or the Borrowing Base, Borrower shall immediately pay to Bank in cash the amount of such excess (such excess, the “Overadvance”). Without limiting Borrower’s obligation to repay Bank any amount of the Overadvance, Borrower agrees to pay Bank interest on the outstanding amount of any Overadvance, on demand, at the Default Rate.

2.4 Section 2.4(c) (Letter of Credit Fee). Section 2.4(c) of the Loan Agreement is amended by deleting it in its entirety and marking it “Reserved.”

2.5 Section 3.5 (Procedures for Borrowing). Section 3.5(b) is hereby amended by deleting the following parenthetical in its entirety:

“(other than Advances under Sections 2.1.3 or 2.1.5)”

2.6 Section 4.1 (Grant of Security Interest). Section 4.1 of the Loan Agreement is hereby amended by adding the following new paragraphs immediately after the first paragraph as follows:

Borrower acknowledges that it previously has entered, and/or may in the future enter, into Bank Services Agreements with Bank. Regardless of the terms of any Bank Services Agreement, Borrower agrees that any amounts Borrower owes Bank thereunder shall be deemed to be Obligations hereunder and that it is the intent of Borrower and Bank to have all such Obligations secured by the first priority perfected security interest in the Collateral granted herein (subject only to Permitted Liens that are permitted pursuant to the terms of this Agreement to have superior priority to Bank’s Lien in this Agreement).

If this Agreement is terminated, Bank’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations) are repaid in full in cash. Upon payment in full in cash of the Obligations (other than inchoate indemnity obligations) and at such time as Bank’s obligation to make Credit Extensions has terminated, Bank shall, at the sole cost and expense of Borrower, release its Liens in the Collateral and all rights therein shall revert to Borrower. In the event (x) all Obligations (other than inchoate indemnity obligations), except for Bank Services, are satisfied in full, and (y) this Agreement is terminated, Bank shall terminate the security interest granted herein upon Borrower providing cash collateral acceptable to Bank in its good faith business judgment for Bank Services, if any. In the event such Bank Services consist of outstanding Letters of Credit, Borrower shall provide to Bank cash collateral in an amount equal to (x) if such Letters of Credit are denominated in Dollars, then at least one hundred five percent (105.0%); and (y) if such Letters of Credit are denominated in a Foreign Currency, then at least one hundred ten percent (110.0%), of the Dollar Equivalent of the face amount of all such Letters of Credit plus all interest, fees, and costs

2.

due or to become due in connection therewith (as estimated by Bank in its business judgment), to secure all of the Obligations relating to such Letters of Credit.

2.7 Section 4.2 (Priority of Security Interest). Section 4.2 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

4.2 Priority of Security Interest. Borrower represents, warrants, and covenants that the security interest granted herein is and shall at all times continue to be a first priority perfected security interest in the Collateral (subject only to Permitted Liens that are permitted pursuant to the terms of this Agreement to have superior priority to Bank’s Lien under this Agreement). If Borrower shall acquire a commercial tort claim, Borrower shall promptly notify Bank in a writing signed by Borrower of the general details thereof and grant to Bank in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to Bank.

2.8 6.12 (Financial Covenants). Section 6.12 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

6.12 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:

(a) Minimum Revenue. Commencing with the calendar quarter ending June 30, 2014, and as of the last day of each calendar quarter thereafter, aggregate revenue (as determined in accordance with GAAP), measured on a cumulative basis for the calendar quarter then ended, of at least the following amounts at the following times:

Quarter Ending	Required Minimum Revenue
June 30, 2014	$9,610,000
September 30, 2014	$10,240,000
December 31, 2014	$10,960,000
March 31, 2015 and thereafter	To be determined based on Borrower’s FY 2015 board-approved plan*

* Notwithstanding the foregoing, Bank shall establish the applicable minimum revenue financial covenant for the calendar quarter ending on March 31, 2015 and each subsequent calendar quarter ending during Borrower’s fiscal year 2015 based upon Borrower’s board-approved plan for the fiscal year ending December 31, 2015, delivered in accordance with Section 6.2, and such covenant shall be set in a manner (but not in amounts) consistent with the covenant set as of June     , 2014 through the calendar quarter ending on December 31, 2014.

3.

2.9 Section 9.1 (Rights and Remedies). Section 9.1(c) of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

(c) demand that Borrower (1) deposit cash with Bank in an amount equal to (x) if such Letters of Credit are denominated in Dollars, at least one hundred five percent (105.0%); and (y) if such Letters of Credit are denominated in a Foreign Currency, at least one hundred ten percent (110.0%), of the Dollar Equivalent of the aggregate face amount of all Letters of Credit remaining undrawn (plus all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its good faith business judgment)), to secure all of the Obligations relating to such Letters of Credit, as collateral security for the repayment of any future drawings under such Letters of Credit, and Borrower shall forthwith deposit and pay such amounts, and (2) pay in advance all letter of credit fees scheduled to be paid or payable over the remaining term of any Letters of Credit;

2.10 Section 12.1 (Termination Prior to Maturity Date). Section 12.1 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

12.1 Section 12.1 Termination Prior to Maturity Date; Survival. All covenants, representations and warranties made in this Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations have been satisfied. So Jong as Borrower has satisfied the Obligations (other than inchoate indemnity obligations, and any other obligations which, by their terms, are to survive the termination of this Agreement, and any Obligations under Bank Services Agreements that are cash collateralized in accordance with Section 4.1 of this Agreement), this Agreement may be terminated prior to the Revolving Line Maturity Date by Borrower, effective three (3) Business Days after written notice of termination is given to Bank. Those obligations that are expressly specified in this Agreement as surviving this Agreement’s termination shall continue to survive notwithstanding this Agreement’s termination.

2.11 Section 12.9 (Survival). Section 12.9 of the Loan Agreement is hereby amended by deleting it in its entirety and making it “Reserved”.

2.12 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: “Cash Management Services”, “FX Business Day”, “FX Reduction Amount”, “FX Reserve”, “Letter of Credit Application”, and “Settlement Date”.

(b) The following terms and their respective definitions are hereby added in alphabetical order to Section 13.1 of the Loan Agreement as follows:

“Bank Services” are any products, credit services, and/or financial accommodations previously, now, or hereafter provided to Borrower or any of its Subsidiaries by Bank or any Bank Affiliate, including, without limitation, any letters of credit, cash management services (including, without limitation, merchant services, direct

4.

deposit of payroll, business credit cards, and check cashing services), interest rate swap arrangements, and foreign exchange services as any such products or services may be identified in Bank’s various agreements related thereto (each, a “Bank Services Agreement”).

“Horizon Subordination Agreement” means, with respect to the Horizon/DBD Loan, that certain Amended and Restated Subordination Agreement dated as of June     , 2014, by and among Bank, Borrower, Horizon Funding Trust 2013-1, as assignee of Horizon Technology Finance Corporation, as a lender, and in its capacity as collateral agent for the Subordinated Creditors (as defined therein) and Fortress Credit Opportunities I LP, as assignee of DBD Credit Funding LLC, as a lender, as the same may be amended, modified, supplemented or restated from time to time.

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

“Availability Amount” is (a) the lesser of (i) the Revolving Line or (ii) the amount available under the Borrowing Base, minus (b) the outstanding principal balance of any Advances.

“Borrowing Base” is eighty-five percent (85.0%) of Eligible Accounts, as determined by Bank from Borrower’s most recent Transaction Report; provided, however, that Bank may decrease the foregoing percentage in its good faith business judgment based on events, conditions, contingencies, or risks which, as determined by Bank, may adversely affect Collateral.

“Credit Extension” is any Advance or any other extension of credit by Bank for Borrower’s benefit.

“FX Forward Contract” is any foreign exchange contract by and between Borrower and Bank under which Borrower commits to purchase from or sell to Bank a specific amount of Foreign Currency on a specified date.

“Letter of Credit” is a standby or commercial letter of credit issued by Bank upon request of Borrower based upon an application, guarantee, indemnity, or similar agreement.

“Loan ‘Documents” are, collectively, this Agreement, the Warrant, the Perfection Certificate, any Bank Services Agreement, the Stock Pledge Agreement, the Horizon Subordination Agreement, any note, or notes or guaranties executed by Borrower, and any other present or future agreement between Borrower and/or for the benefit of Bank in connection with this Agreement, all as amended, restated, or otherwise modified.

“Revolving Line” is an Advance or Advances in an amount equal to Eight Million Dollars ($8,000,000); provided, however, that if, at any time, Borrower’s aggregate revenue (as determined in accordance with GAAP) during the most recently ended three (3) calendar month period is less than Eight Million Five Hundred Thousand

5.

Dollars ($8,500,000), then the Revolving Line shall automatically reduce to Five Million Dollars ($5,000,000) until such time that Borrower achieves aggregate revenue (as determined in accordance with GAAP) of not less than Eight Million Five Hundred Thousand Dollars ($8,500,000) during the most recently ended three (3) calendar month period.

2.13 Exhibit B (Compliance Certificate). The Compliance Certificate attached to the Loan Agreement as Exhibit B is replaced in its entirety with the Compliance Certificate attached hereto as Exhibit B. From and after the date hereof, all references in the Loan Agreement to the Compliance Certificate shall mean the Compliance Certificate in the form attached hereto as Exhibit B.

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 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.

3.3 In addition to those Events of Default specifically enumerated in the Loan Documents, the failure to comply with the terms of any covenant or agreement contained herein shall constitute an Event of Default and shall entitle the Bank to exercise all rights and remedies provided to the Bank under the terms of any of the other Loan Documents as a result of the occurrence of the same.

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;

6.

4.3 The organizational documents of Borrower delivered to Bank on the Effective Date and on September 26, 2013 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;

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; and

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 (a) the due execution and delivery to Bank of this Amendment by each party hereto, (b) Borrower’s payment of a non-refundable amendment fee in the amount of Fifteen Thousand Dollars ($15,000), (c) Bank’s receipt of the Horizon Subordination Agreement substantially in the form attached hereto as Schedule 1 and dated as of even date herewith, duly executed and delivered by Borrower, Horizon Funding Trust 2013-1, as assignee of Horizon Technology Finance Corporation, as a lender, and in its capacity as collateral agent for the Subordinated Creditors (as defined therein) and Fortress Credit Opportunities I LP, as assignee of DBD Credit Funding LLC, as a lender, and (d) payment of Bank’s legal fees and expenses in connection with the negotiation and preparation of this Amendment and the Horizon Subordination Agreement.

[Signature page follows.]

7.

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/ Matthew Wright

Name: Matthew Wright

Title: Director

BORROWER:
EASIC CORPORATION
By:	/s/ Ronnie Vasishta

Name: Ronnie Vasishta

Title: President/CEO

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

EXHIBIT B

COMPLIANCE CERTIFICATE

TO:	SILICON VALLEY BANK	Date:
FROM:	EASIC CORPORATION

The undersigned authorized officer of eASIC 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 5.9 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 (“CC”)	Monthly within 30 days	Yes        No
Annual financial statement (Company Prepared)	FYE within 30 days	Yes        No
Annual financial statement (CPA Audited) + CC	FYE within 180 days*	Yes        No
Annual Board-Approved financial projections	Annually within 10 days of approval	Yes        No
Transaction Reports	Weekly at all times that any Advances are outstanding	Yes        No
Statements of Cash Balances at Foreign Deposit Accounts	Monthly within 30 days	Yes        No
10-Q, 10-K and 8-K	Within 5 days after filing with SEC	Yes        No
Borrowing Base Certificate A/R & A/P Agings	Monthly within 30 days	Yes        No
*FYE 2012 and 2013 annual financial statements due 12/31/2014

Financial Covenant	Required		Actual	Complies
Maintain on a Quarterly Basis:
Minimum Revenue
June 30, 2014	$	9,610,000	$		Yes        No
September 30, 2014	$	10,240,000	$		Yes        No
December 31, 2014	$	10,960,000	$		Yes        No

Exhibit B – Page 1.

March 31, 2015 To be
determined
based on
Borrower’s FY
2015 board-
approved plan $ Yes        No

Amount of Revolving Loan
Aggregate Revenue	Revolving Loan		Applies
Aggregate revenue (as determined in accordance with GAAP) for the most recently ended three (3) calendar month period ³ $8,500,000	$	8,000,000		Yes        No
Aggregate revenue (as determined in accordance with GAAP) for the most recently ended three (3) calendar month period < $8,500,000	$	5,000,000		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.

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

EASIC CORPORATION

By:

Name:

Title:

BANK USE ONLY

Received by:
	AUTHORIZED SIGNER

Date:

Verified:
	AUTHORIZED SIGNER

Date:

Compliance Status: Yes No

Exhibit B – Page 2.

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:                                         

Minimum Revenue (Section 6.12(a))

Required: Commencing with the calendar quarter ending June 30, 2014, and as of the last day of each calendar quarter thereafter, aggregate revenue (as determined in accordance with GAAP), measured on a cumulative basis for calendar quarter then ended, of at least the following amounts at the following times:

Quarter Ending	Required Minimum Revenue
June 30, 2014	$9,610,000
September 30, 2014	$10,240,000
December 31, 2014	$10,960,000
March 31, 2015 and thereafter	To be determined based on Borrower’s FY 2015 board-approved plan

Actual:                                         

A. Aggregate revenue (as determined in accordance with GAAP) for the quarter then ended on a cumulative basis $            

Is line A equal to or greater than the required amount above?

                     No, not in compliance                      Yes, in compliance

Exhibit B – Page 1

TENTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS TENTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into as of the 12^th day of September, 2014, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITALS

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of September 29, 2010 (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, Horizon Funding Trust 2013-1 (“Horizon Trust”), as assignee of Horizon Technology Finance Corporation (“Horizon” and, in its capacity as collateral agent for each Existing Subordinated Horizon Creditor (as hereinafter defined), the “Horizon Collateral Agent”), and Fortress Credit Opportunities I LP (“FCO”; together with Horizon Collateral Agent and Horizon Trust, each an “Existing Subordinated Horizon Creditor”, and collectively, the “Existing Subordinated Horizon Creditors”), as assignee of DBD Credit Funding LLC (“DBD”) are parties to a certain Venture Loan and Security Agreement dated as of September 30, 2013 (as may be amended, modified, supplemented or restated from time to time, the “Existing Subordinated Horizon Loan Agreement”) pursuant to which, among other things, (i) Horizon provided a loan to Borrower as evidenced by a certain Secured Promissory Note (Loan A) executed by Borrower in favor of Horizon dated September 30, 2013, in the original principal amount of Two Million Dollars ($2,000,000) (the “Subordinated Horizon Loan A Note”) (such term loan hereinafter being called the “Subordinated Horizon Loan A”), (ii) DBD provided a loan to Borrower as evidenced by a certain Secured Promissory Note (Loan B) executed by Borrower in favor of DBD dated September 30, 2013, in the original principal amount of Four Million Dollars ($4,000,000) (the “Subordinated Horizon Loan B Note” and collectively with the Subordinated Horizon Loan A Note, the “Existing Subordinated Horizon Notes”) (such term loan hereinafter being called the “Subordinated Horizon Loan B”) and (iii) each Existing Subordinated Horizon Creditor has been granted a security interest in substantially all personal property assets of Borrower, except with respect to Borrower’s Intellectual Property (such loan transaction hereinafter being called the “Subordinated Horizon Loan Transaction”). Bank consented to the Subordinated Horizon Loan Transaction pursuant to the terms and conditions of that certain Eighth Amendment to Loan and Security Agreement dated September 26, 2013 by and between Borrower and Bank (the “Eighth Amendment”).

D. Horizon transferred all of its right, title and interest in and to the Subordinated Horizon Loan A Note and the Existing Subordinated Horizon Loan Agreement to Horizon Funding 2013-1 LLC (“Horizon Funding”) on or about June 28, 2014, and Horizon Funding subsequently sold all of its right, title and interest in and to the Subordinated Horizon Loan A Note and the Existing Subordinated Horizon Loan Agreement to Horizon Trust on or about June 28, 2014. DBD transferred all of its right, title and interest in and to the Subordinated Horizon Loan B Note and the Existing Subordinated Horizon Loan Agreement to FCO on or about September 30, 2013.

E. Bank, Horizon and DBD previously entered into that certain Subordination Agreement dated as of September 30, 2013, which was subsequently amended., restated and replaced by that certain Amended and Restated Subordination Agreement dated as of June 9, 2014 by and among Bank and the Existing Subordinated Horizon Creditors (as may be amended, modified, supplemented or restated from time to time, the “Existing Horizon Subordination Agreement”).

F. The Existing Subordinated Horizon Creditors and DBD (collectively, the “Subordinated Horizon Creditors”) and Borrower contemplate increasing the aggregate principal amount of the Subordinated Horizon Loan Transaction from an aggregate principal amount of Six Million Dollars ($6,000,000) to Nine Million Dollars ($9,000,000) (the “Increased Horizon Loan Maximum”) by entering into that certain Amended and Restated Venture Loan and Security Agreement dated as of September 12, 2014 (as the same may be amended, modified, supplemented or restated from time to time, the “Restated Subordinated Horizon Loan Agreement”) (such secured term loans not exceeding the Increased Horizon Loan Maximum, in the aggregate, as evidenced by the Restated Subordinated Horizon Loan Agreement, hereinafter being called the “Subordinated Horizon Loans”). The Restated Subordinated Horizon Loan Agreement will amend, restate and replace the Existing Subordinated Horizon Loan Agreement in its entirety.

G. Borrower has requested that Bank (i) consent to the Increased Horizon Loan Maximum as it relates to the Subordinated Horizon Loans and (ii) amend the Loan Agreement to make certain revisions to the Loan Agreement as more fully set forth herein.

H. Although Bank is under no obligation to do so, Bank is willing to consent to the Increased Horizon Loan Maximum and amend certain provisions of the Loan Agreement as more fully set forth herein, 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. Increased Horizon Loan Maximum.

2.1 Consent. Subject to the express terms of Section 7 below, Bank hereby (a) consents to the Increased Horizon Loan Maximum as it relates to the Subordinated Horizon Loans, (b) agrees that the Subordinated Horizon Loans shall constitute “Permitted Indebtedness” under the Loan Agreement (pursuant to the terms of the Restated Horizon Subordination

2.

Agreement (as defined below)) to the extent the aggregate principal amount advanced under the Subordinated Horizon Loans does not exceed the Increased Horizon Loan Maximum, and (c) agrees that the Liens in favor of the Horizon Collateral Agent and the Subordinated Horizon Creditors to secure the Subordinated Horizon Loans shall be considered a “Permitted Lien” under the Loan Agreement (pursuant to the terms of the Restated Horizon Subordination Agreement) to the extent the aggregate principal amount secured thereby does not exceed the Increased Horizon Loan Maximum. The consent set forth in this Section shall not be deemed or otherwise construed to constitute a consent or waiver of any provisions of the Loan Agreement or any other Loan Document in connection with any other transaction other than as specifically set forth in this Amendment.

2.2 Restated Horizon Subordination Agreement. Borrower has read, reviewed and approved all of the terms of the Restated Horizon Subordination Agreement. Bank and Borrower hereby agree that the Restated Horizon Subordination Agreement shall be included in the term “Loan Documents” as defined in the Loan Agreement.

2.3 Covenants and Defaults. Bank and Borrower hereby acknowledge and agree that (a) Borrower shall not amend, modify or supplement any of the Subordinated Horizon Loan Documents (as defined below) in a manner which would (i) increase the aggregate principal amount of Subordinated Horizon Loans beyond the Increased Horizon Loan Maximum, (ii) increase any applicable interest rate with respect to the Indebtedness owing under the Subordinated Horizon Loans by more than 200 basis points (excluding increases based solely on (A) changes to the prime rate or any other index and (B) the imposition of the default rate of interest in accordance with the Subordinated Horizon Loan Documents), (iii) change the terms of principal or interest repayment with respect to the Indebtedness owing under the Subordinated Horizon Loans, (iv) change the payment schedule with respect to the Indebtedness owing under the Subordinated Horizon Loans, (v) add express conditions that directly restrict the payment of the Obligations, (vi) change the maturity date with respect to the Indebtedness owing under the Subordinated Horizon Loans from that set forth in the Subordinated Horizon Loan Documents in effect as of September 12, 2014 (the “Subordinated Horizon Loan Documents Execution Date”) or (vii) change the definition of Collateral set forth in the Subordinated Horizon Loan Documents from the definition in effect as of the Subordinated Horizon Loan Documents Execution Date; (b) the occurrence of a default under the Subordinated Horizon Loan Documents (if such default is not waived, or otherwise cured within any applicable grace period provided therein) shall be an Event of Default under the Loan Agreement; and (c) any breach of the Restated Horizon Subordination Agreement by Horizon Collateral Agent and/or any of the Subordinated Horizon Creditors shall be an Event of Default under the Loan Agreement (if such breach is not otherwise cured within any applicable grace period).

3. Amendments to Loan Agreement.

3.1 Section 12.1 (Termination Prior to Revolving Line Maturity Date; Survival). Section 12.1 of the Loan Agreement is hereby amended by adding the following sentence immediately at the end of such Section:

If such termination is at Borrower’s election or at Bank’s election due to the occurrence and continuance of an Event of Default, Borrower shall pay to Bank, in addition to the

3.

payment of any other expenses or fees then-owing, a termination fee in an amount equal to Seventy-Five Thousand Dollars ($75,000), provided, that no termination fee shall be charged if the credit facility hereunder is replaced with a new facility from another division of Bank.

3.2 Section 13 (Definitions).

(a) The following terms and its definition are hereby added in alphabetical order to Section 13.1 of the Loan Agreement as follows:

“Restated Horizon Subordination Agreement” means that certain Second Amended and Restated Subordination Agreement dated as of September 12, 2014, by and among Bank, Borrower, Horizon Technology Finance Corporation, as a lender, and in its capacity as collateral agent for the Subordinated Creditors (as defined therein), Horizon Funding Trust 2013-1, DBD Credit Funding LLC and Fortress Credit Opportunities I LP, as the same may be amended, modified, supplemented or restated from time to time.

4. Limitation of Consent and Amendments.

4.1 The consent set forth in Section 2 and 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.

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.

4.3 In addition to those Events of Default specifically enumerated in the Loan Documents, the failure to comply with the terms of any covenant or agreement contained herein shall constitute an Event of Default and shall entitle the Bank to exercise all rights and remedies provided to the Bank under the terms of any of the other Loan Documents as a result of the occurrence of the same.

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;

4.

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 and on September 26, 2013 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;

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; and

5.8 Attached as Schedule 1 are true, complete and correct copies of all of the documents relating to, evidencing or securing the Subordinated Horizon Loans, including all amendments, supplements and other modifications thereto (the “Subordinated Horizon 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 (a) the due execution and delivery to Bank of this Amendment by each party hereto, (b) Bank’s receipt of the Subordinated Horizon Loan Documents, (c) Bank’s receipt of the Restated Horizon Subordination Agreement substantially in the form attached hereto as Schedule 2 and dated as of even date herewith, duly executed and delivered by Borrower, Horizon Collateral Agent and each of the Subordinated Horizon Creditors, and (d) payment of Bank’s legal fees and expenses

5.

in connection with the negotiation and preparation of this Amendment, the Restated Horizon Subordination Agreement and the review of the Subordinated Horizon Loan Documents.

[Signature page follows.]

6.

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/ Matthew Wright
Name:	Matthew Wright
Title:	Director

BORROWER: EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	CEO

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

ELEVENTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS ELEVENTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 4^th day of December, 2014, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITALS

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of September 29, 2010 (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 (i) extend the Revolving Line Maturity Date, and (ii) make certain other revisions to the Loan Agreement as more fully set forth herein.

D. Although Bank is under no obligation to do so, Bank is willing to amend certain provisions of the Loan Agreement as more fully set forth herein, 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 6.6 (Access to Collateral; Books and Records). The second sentence of Section 6.6 of the Loan Agreement is hereby amended by deleting such sentence in its entirety, and replacing it with the following:

Provided no Event of Default has occurred and is continuing, such audits shall be conducted no more than once every twelve (12) months.

2.2 Section 6.8 (Operating Accounts). Section 6.8(a) of the Loan Agreement is hereby amended in its entirety and replaced with the following:

(a) Maintain all of its and all of its Subsidiaries’ primary operating and investment accounts with Bank and Bank’s Affiliates except for its foreign deposit accounts with the banks or financial institutions listed on the Perfection Certificate (individually, a “Foreign Deposit Account”, and collectively, the “Foreign Deposit Accounts”); provided, that the Foreign Deposit Accounts shall not contain deposits having a value of more than Eight Hundred Thousand Dollars ($800,000) in the aggregate at any time.

2.3 Section 6.12 (Financial Covenants). Section 6.12 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

6.12 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:

(a) Minimum Revenue. Commencing with the calendar quarter ending December 31, 2014, and as of the last day of each calendar quarter thereafter, aggregate revenue (as determined in accordance with GAAP), measured on a cumulative basis for the calendar quarter then ended, of at least the following amounts at the following times:

Quarter Ending	Required Minimum Revenue
December 31, 2014	$10,960,000
March 31, 2015	$15,394,000
June 30, 2015	$16,119,000
September 30, 2015	$16,457,000
December 31, 2015	$17,780,000
March 31, 2016	$18,000,000
June 30, 2016	$18,000,000
September 30, 2016	$18,000,000
December 31, 2016	$18,000,000

2.4 Section 8.2 (Covenant Default). Section 8.2(a) of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

2

(a) Borrower fails or neglects to perform any obligation in Sections 6.2, 6.5, 6.6, 6.7, 6.8, 6.9(b), 6.12, or violates any covenant in Section 7; or

2.5 Section 13 (Definitions).

(a) The definition of “Revolving Line Maturity Date” set forth in Section 13.1 of the Loan Agreement is hereby amended in its entirety and replaced with the following:

“Revolving Line Maturity Date” is September 25, 2016.

(b) The definition of “Eligible Accounts” set forth in Section 13.1 of the Loan Agreement is hereby amended by deleting clause (v) in its entirety and replacing it with the following:

(v) Accounts owing from an Account Debtor, whose total obligations to Borrower exceed thirty percent (30.0%) of all Accounts, except for (i) Ericsson and Arrow for which such percentage is seventy percent (70.0%), and (ii) Seagate and Cal-Comp for which such percentage is sixty percent (60.0%), for the amounts that exceed that percentage, unless Bank approves in writing; and

2.6 Eleventh Amendment Fee. Borrower shall pay to Bank on or before September 26, 2016, a non-refundable amendment fee of Forty Thousand Dollars ($40,000) which has been fully earned by Bank as of December 4, 2014 (the “Eleventh Amendment Fee”). Notwithstanding the foregoing or anything to the contrary in the Loan Documents, in the event the Loan Agreement is terminated prior to the Revolving Line Maturity Date in accordance with Section 12.1 of the Loan Agreement, then in addition to the payment of the early termination fee (and any other fees and expenses then-owing) as more fully described in Section 12.1 of the Loan Agreement, Borrower shall pay the Eleventh Amendment Fee to Bank on the date of such termination; provided that no Eleventh Amendment Fee shall be charged if the credit facility under the Loan Agreement is replaced with a new facility from another division of Bank.

2.7 Exhibit B (Compliance Certificate). The Compliance Certificate attached to the Loan Agreement as Exhibit B is replaced in its entirety with the Compliance Certificate attached hereto as Exhibit B. From and after the date hereof, all references in the Loan Agreement to the Compliance Certificate shall mean the Compliance Certificate in the form attached hereto as Exhibit B.

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 Loan Documents and all terms, conditions, representations, warranties, covenants and

3

agreements set forth in the Loan Documents, except as herein amended, are hereby ratified and confirmed and shall remain in full force and effect.

3.3 In addition to those Events of Default specifically enumerated in the Loan Documents, the failure to comply with the terms of any covenant or agreement contained herein shall constitute an Event of Default and shall entitle the Bank to exercise all rights and remedies provided to the Bank under the terms of any of the other Loan Documents as a result of the occurrence of the same.

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 Effective Date and on September 26, 2013 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.

4

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 (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.

[Signature page follows.]

5

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/ Matthew Wright
Name:	Matthew Wright
Title:	Director
BORROWER:
EASIC CORPORATION
By:	/s/ Ronnie Vasishta
Name:	Ronnie Vasishta
Title:	CEO

EXHIBIT B

COMPLIANCE CERTIFICATE

TO:	SILICON VALLEY BANK	Date:
FROM:	EASIC CORPORATION

The undersigned authorized officer of eASIC 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 5.9 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 (“CC”)	Monthly within 30 days	Yes        No
Annual financial statement (Company Prepared)	FYE within 30 days	Yes        No
Annual financial statement (CPA Audited) + CC	FYE within 180 days*	Yes        No
Annual Board-Approved financial projections	Annually within 10 days of approval	Yes        No
Transaction Reports	Weekly at all times that any Advances are outstanding	Yes        No
Statements of Cash Balances at Foreign Deposit Accounts	Monthly within 30 days	Yes        No
10-Q, 10-K and 8-K	Within 5 days after filing with SEC	Yes        No
Borrowing Base Certificate A/R & A/P Agings	Monthly within 30 days	Yes        No
*FYE 2012 and 2013 annual financial statements due 12/31/2014

Financial Covenant	Required		Actual	Complies
Maintain on a Quarterly Basis:
Minimum Revenue
December 31, 2014	$	10,960,000	$		Yes        No
March 31, 2015	$	15,394,000	$		Yes        No
June 30, 2015	$	16,119,000	$		Yes        No

Exhibit B – Page 1

September 30, 2015	$	16,457,000	$	Yes        No
December 31, 2015	$	17,780,000	$	Yes        No
March 31, 2016	$	18,000,000	$	Yes        No
June 30, 2016	$	18,000,000	$	Yes        No
September 30, 2016	$	18,000,000	$	Yes        No
December 31, 2016	$	18,000,000	$	Yes        No

Amount of Revolving Loan
Aggregate Revenue	Revolving Loan		Applies
Aggregate revenue (as determined in accordance with GAAP) for the most recently ended three (3) calendar month period ³ $8,500,000	$	8,000,000		Yes        No
Aggregate revenue (as determined in accordance with GAAP) for the most recently ended three (3) calendar month period < $8,500,000	$	5,000,000		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.

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

EASIC CORPORATION

By:

Name:

Title:

BANK USE ONLY

Received by:
	AUTHORIZED SIGNER

Date:

Verified:
	AUTHORIZED SIGNER

Date:

Compliance Status: Yes        No

Exhibit B – Page 2

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:                                         

Minimum Revenue (Section 6.12(a))

Required: Commencing with the calendar quarter ending December 31, 2014, and as of the last day of each calendar quarter thereafter, aggregate revenue (as determined in accordance with GAAP), measured on a cumulative basis for the calendar quarter then ended, of at least the following amounts at the following times:

Quarter Ending	Required Minimum Revenue
December 31, 2014	$10,960,000
March 31, 2015	$15,394,000
June 30, 2015	$16,119,000
September 30, 2015	$16,457,000
December 31, 2015	$17,780,000
March 31, 2016	$18,000,000
June 30, 2016	$18,000,000
September 30, 2016	$18,000,000
December 31, 2016	$18,000,000

Actual:             

A. Aggregate revenue (as determined in accordance with GAAP) for the calendar quarter then ended on a cumulative basis $            

Is line A equal to or greater than the required amount above?

                     No, not in compliance                      Yes, in compliance

Schedule 1 to Exhibit B

TWELFTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

THIS TWELFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 30^th day of June, 2015, by and between SILICON VALLEY BANK (“Bank”) and EASIC CORPORATION, a Delaware corporation (“Borrower”) whose address is 2585 Augustine Drive, Suite 100, Santa Clara, California 95054.

RECITALS

A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of September 29, 2010 (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 is currently in default under Section 8.7 of the Loan Agreement for failing to obtain the prior consent of certain lenders under that certain the Restated Subordinated Horizon Loan Agreement (as such term is defined in Recital C of the Tenth Amendment to Loan and Security Agreement by and between Bank and Borrower dated as of September 12, 2014) to the Tax Reorganization and Transfer Pricing arrangements (as such terms are defined below) and related amendments thereunder (the “Existing Default”), and such failure to comply constitutes an Event of Default.

D. Borrower has requested that Bank (i) waive the Existing Default and (ii) amend the Loan Agreement to (a) modify the Minimum Revenue financial covenant, and (b) make certain other revisions to the Loan Agreement as more fully set forth herein.

E. Although Bank is under no obligation to do so, Bank is willing to waive the Existing Default and amend certain provisions of the Loan Agreement as more fully set forth herein, 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.

1.

2. Amendments to Loan Agreement.

2.1 Section 5.4 (Litigation). Section 5.4 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

5.4 Litigation. There are no actions or proceedings pending or, to the knowledge of any Responsible Officer, threatened in writing by or against Borrower or any of its Subsidiaries involving more than, individually or in the aggregate, Three Hundred Fifty Thousand Dollars ($350,000).

2.2 Section 6.2 (Financial Statements, Reports, Certificates). Section 6.2(k) of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

(k) prompt report of any legal actions pending or threatened in writing against Borrower or any of its Subsidiaries that could result in damages or costs to Borrower or any of its Subsidiaries of, individually or in the aggregate, Three Hundred Fifty Thousand Dollars ($350,000) or more; and

2.3 Section 6.12 (Financial Covenants). Section 6.12 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

6.12 Financial Covenants.

(a) Minimum Revenue. Maintain at all times, to be tested as of the last day of each calendar quarter, on a consolidated basis with respect to Borrower and its Subsidiaries, aggregate revenue (as determined in accordance with GAAP), measured on a cumulative basis for the calendar quarter then ended, of at least the following amounts at the following times:

Quarter Ending	Required Minimum Revenue
June 30, 2015	$	14,500,000
September 30, 2015	$	16,457,000
December 31, 2015	$	17,780,000
March 31, 2016	$	18,000,000
June 30, 2016	$	18,000,000
September 30, 2016	$	18,000,000
December 31, 2016	$	18,000,000

2.

2.4 Section 7.1 (Dispositions). Section 7.1 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

7.1 Dispositions. Convey, sell, lease, transfer, assign, or otherwise dispose of (collectively, “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, except for Transfers (a) of Inventory in the ordinary course of business; (b) of worn-out or obsolete Equipment that is, in the reasonable judgment of Borrower, no longer economically practicable to maintain or useful in the ordinary course of business of Borrower; (c) consisting of Permitted Liens and Permitted Investments; (d) consisting of the sale or issuance of any stock of Borrower permitted under Section 7.2 of this Agreement; (e) consisting of Borrower’s use or transfer of money or Cash Equivalents in a manner that is not prohibited by the terms of this Agreement or the other Loan Documents; (f) Transfers between or among the Borrower and its Subsidiaries in connection with the Tax Reorganization; and (g) of property, valued in amount not to exceed Two Hundred Thousand Dollars ($200,000) in the aggregate in any fiscal year, to Borrower’s Subsidiaries consistent with past practices of Borrower and solely within the ordinary course of Borrower’s business.

2.5 Section 7.8 (Transactions with Affiliates). Section 7.8 of the Loan Agreement is hereby amended by deleting it in its entirety and replacing it with the following:

7.8 Transactions with Affiliates. Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower, except for (a) sales of equity securities to existing investors, (b) transactions that are in the ordinary course of Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm’s length transaction with a non-affiliated Person, (c) bona fide equity investments in Borrower, (d) unsecured debt financings from Borrower’s investors so long as all such Indebtedness shall constitute unsecured Subordinated Debt, (e) compensation arrangements and benefit plans for officers and other employees of Borrower and its Subsidiaries entered into or maintained in the ordinary course of business, (f) reasonable and customary fees paid to members of Borrower’s Board of Directors and its Subsidiaries in the ordinary course of business, (g) transactions between or among Borrower and any of its Subsidiaries that are not otherwise prohibited hereunder, (h) transactions permitted pursuant to Section 7.2 and Section 7.7hereof, (i) transactions permitted under the definition of Permitted Investments, (j) the Tax Reorganization, and (k) Transfer Pricing arrangements constituting Permitted Investments.

2.6 Section 7 (Negative Covenants). Section 7 of the Loan Agreement is hereby amended by adding Section 7.11 in its entirety immediately after Section 7.10 of the Loan Agreement as follows:

7.11 Transfer Pricing. Other than as required by applicable law, modify, or permit any Subsidiary to modify, its Transfer Pricing arrangements in a manner that has, or is reasonably likely to have, a material adverse effect on Borrower’s or any Subsidiary’s business.

3.

2.7 Section 13 (Definitions).

(a) Clause (f) of the definition of “Permitted Investments” set forth in Section 13.1 of the Loan Agreement is hereby amended in its entirety and replaced with the following:

(f) Investments (i) by Borrower in Subsidiaries not to exceed Five Hundred Thousand Dollars ($500,000) in the aggregate in any fiscal year, (ii) by Subsidiaries in other Subsidiaries not to exceed Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate in any fiscal year or in Borrower, (iii) by Borrower in Foreign Subsidiaries consisting of cash in an aggregate amount at any time outstanding (net of any intercompany loan repayments owing from such Foreign Subsidiaries to Borrower and returns of invested capital owing from such Foreign Subsidiaries to Borrower) not to exceed one hundred twenty percent (120%) of all such Foreign Subsidiaries’ operating expenses pursuant to Transfer Pricing arrangements entered into in the ordinary course of business from time to time among Borrower and such Foreign Subsidiaries, and (iv) Investments between or among the Borrower and its Subsidiaries in connection with a Tax Reorganization;

(b) The following terms and their respective definitions are hereby added in alphabetical order to Section 13.1 of the Loan Agreement:

“Domestic Subsidiary” means a Subsidiary organized under the laws of the United States or any state or territory thereof or the District of Columbia.

“Foreign Subsidiary” means any Subsidiary which is not a Domestic Subsidiary.

“Tax Reorganization” means a corporate restructuring effective in the second quarter of 2015 in which Borrower, pursuant to a comprehensive plan (in which Borrower received all required approvals and due authorization to consummate such plan of restructuring) that was designed to increase the tax efficiency of Borrower and its Subsidiaries, as a whole, (i) transferred to the Malaysia Subsidiary, certain customer contracts, (ii) transferred to Bermuda Subsidiary, certain vendor arrangements, (iii) restructured certain Subsidiaries of Borrower, (iv) established new intercompany functional relationships and capital arrangements among the Borrower and its Subsidiaries and (v) took such other reasonable actions as were necessary to improve the consolidated tax efficiency of the Borrower and its Subsidiaries.

“Transfer Pricing” means the arm’s length price that is charged by a party for products and services it provides to another related party, in order to calculate each party’s profit and loss separately.

2.8 Closing of Restated Loan Agreement and Restructured Credit Facility. Notwithstanding anything to the contrary herein or in the other Loan Documents, Borrower and Bank hereby acknowledge and agree that on a date not later than forty-five (45) days after the date of this Amendment, the Loan Agreement will be restated and replaced and that Borrower will execute and deliver, among other things, a replacement loan agreement with Borrower to restate and replace the Loan Agreement (the “Replacement Loan Agreement”), a replacement stock pledge agreement to restate and replace the Stock Pledge Agreement, a foreign

4.

loan and security agreement with Malaysian Subsidiary, the guaranty from the Bermuda Subsidiary, and such other documents, notes, instruments, control agreements and opinions as Bank may request in its sole and absolute discretion (collectively, the “Replacement Loan Documents”). Such Replacement Loan Documents shall restructure the current credit facility to include an $8,000,000 revolving line of credit with the Malaysian Subsidiary as a co-borrower with Borrower and shall be satisfactory in all respects to Bank, Borrower, Malaysian Subsidiary and Bermuda Subsidiary. If Borrower, Malaysian Subsidiary and Bermuda Subsidiary fail to execute such Replacement Loan Documents on a date not later than forty-five (45) days after the date of this Amendment (the “Replacement Loan Documents Due Date”), then Borrower shall be in immediate Event of Default under the Loan Agreement.

2.9 Eleventh Amendment Fee. Notwithstanding anything to the contrary in that certain Eleventh Amendment to Loan and Security Agreement by and between Bank and Borrower dated as of December 4, 2014 (the “Eleventh Amendment”), Borrower hereby acknowledges and agrees that if Borrower, Malaysian Subsidiary and Bermuda Subsidiary fail to execute the Replacement Loan Documents, then Borrower shall pay the Eleventh Amendment Fee (as defined in the Eleventh Amendment) to Bank on September 25, 2015. For purposes of clarification, no Eleventh Amendment Fee shall be charged if the Replacement Loan Documents are executed by Borrower, Malaysian Subsidiary and Bermuda Subsidiary.

2.10 Exhibit B (Compliance Certificate). The Compliance Certificate attached to the Loan Agreement as Exhibit B is replaced in its entirety with the Compliance Certificate attached hereto as Exhibit B. From and after the date hereof, all references in the Loan Agreement to the Compliance Certificate shall mean the Compliance Certificate in the form attached hereto as Exhibit B.

3. Waiver of Existing Default. Borrower acknowledges and agrees that unless the Existing Default is waived by Bank, such Existing Default would constitute an Event of Default under the Loan Documents. Bank hereby waives the Existing Default. Bank’s agreement to waive the Existing Default shall in no way obligate Bank to make any other modifications to the Loan Agreement or to waive Borrower’s compliance with any other terms of the Loan Documents, and shall not limit or impair Bank’s right to demand strict performance of all other terms and covenants as of any date. The waiver set forth above shall not be deemed or otherwise construed to constitute a waiver of any other provisions of the Loan Agreement in connection with any other transaction.

4. Limitation of Amendments and Waiver.

4.1 The amendments and waiver set forth in Sections 2 and 3 above, respectively, 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; provided, however, that the amendments relating to the Tax Reorganization and Transfer Pricing arrangements shall be given retroactive effect to April 1, 2015.

5.

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.

4.3 In addition to those Events of Default specifically enumerated in the Loan Documents, the failure to comply with the terms of any covenant or agreement contained herein shall constitute an Event of Default and shall entitle the Bank to exercise all rights and remedies provided to the Bank under the terms of any of the other Loan Documents as a result of the occurrence of the same.

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 other than the Existing Default;

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 and on September 26, 2013 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.

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 (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.

[Signature page follows.]

7.

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/ Matthew Wright
Name:	Matthew Wright
Title:	Director
BORROWER:
EASIC CORPORATION
By:	/s/ Richard Deranleau
Name:	Richard Deranleau
Title:	VP Finance & CFO

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

EXHIBIT B

COMPLIANCE CERTIFICATE

TO:	SILICON VALLEY BANK	Date:
FROM:	EASIC CORPORATION

The undersigned authorized officer of eASIC 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 5.9 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 (“CC”)	Monthly within 30 days	Yes No
Annual financial statement (Company Prepared)	FYE within 30 days	Yes No
Annual financial statement (CPA Audited) + CC	FYE within 180 days	Yes No
Annual Board-Approved financial projections	Annually within 10 days of approval	Yes No
Transaction Reports	Weekly at all times that any Advances are outstanding	Yes No
Statements of Cash Balances at Foreign Deposit Accounts	Monthly within 30 days	Yes No
10-Q, 10-K and 8-K	Within 5 days after filing with SEC	Yes No
Borrowing Base Certificate A/R. & A/P Agings	Monthly within 30 days	Yes No

Financial Covenant	Required		Actual	Complies
Maintain on a Quarterly Basis:
Minimum Revenue
June 30, 2015	$	14,500,000	$		Yes No
September 30, 2015	$	16,457,000	$		Yes No
December 31, 2015	$	17,780,000	$		Yes No
March 31, 2016	$	18,000,000	$		Yes No
June 30, 2016	$	18,000,000	$		Yes No
September 30, 2016	$	18,000,000	$		Yes No
December 31, 2016	$	18,000,000	$		Yes No

Exhibit B – Page 1

Amount of Revolving Loan

Aggregate Revenue	Revolving Loan		Applies
Aggregate revenue (as determined in accordance with GAAP) for the most recently ended three (3) calendar month period > $8,500,000	$	8,000,000	Yes No
Aggregate revenue (as determined in accordance with GAAP) for the most recently ended three (3) calendar month period < $8,500,000	$	5,000,000	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.

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

EASIC CORPORATION	BANK USE ONLY
By:	Received by:
Name:		AUTHORIZED SIGNER
Title:	Date:
	Verified:
		AUTHORIZED SIGNER
	Date:
	Compliance Status:	Yes No

Exhibit B – Page 2

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:                                         

Minimum Revenue (Section 6.12(a))

Required: Maintain at all times, to be tested as of the last day of each calendar quarter, on a consolidated basis with respect to Borrower and its Subsidiaries, aggregate revenue (as determined in accordance with GAAP), measured on a cumulative basis for the calendar quarter then ended, of at least the following amounts at the following times:

Quarter Ending	Required Minimum Revenue
June 30, 2015	$14,500,000
September 30, 2015	$16,457,000
December 31, 2015	$17,780,000
March 31, 2016	$18,000,000
June 30, 2016	$18,000,000
September 30, 2016	$18,000,000
December 31, 2016	$18,000,000

Actual:                     

A. Aggregate revenue (as determined in accordance with GAAP) for the calendar quarter then ended on a cumulative basis $            

Is line A equal to or greater than the required amount above?

                     No, not in compliance                      Yes, in compliance

Schedule 1 to Exhibit B

EX-10.21

Exhibit 10.21

eASIC CORPORATION

CHANGE IN CONTROL AND SEVERANCE AGREEMENT

This Change in Control and Severance Agreement (this “Agreement”) is entered into by and between                      (“Executive”) and eASIC Corporation, a Delaware corporation (the “Company”), to become effective upon the date of the Company’s initial public offering.

RECITALS

A. The Company expects to make an initial public offering of its common stock (“IPO) in the near future.

B. The Company’s Board of Directors (the “Board”) believes it is in the best interests of the Company and its stockholders to retain Executive on and after the IPO and to provide Executive with certain protections in the event of Executive’s termination of employment under certain circumstances.

Now therefore, in consideration of the mutual promises, covenants and agreements contained herein, and in consideration of the continuing employment of Executive by the Company, the parties hereto agree as follows:

1. Effectiveness and Term of Agreement; At-Will Employment. This Agreement shall become effective upon the Company’s IPO and shall remain in effect for a term of three years from such date, after which time this Agreement may be renewed by mutual agreement of the parties. Executive’s employment is and shall remain at-will, which means that the Company may terminate Executive’s employment at any time, with or without advance notice, and with or without Cause. Similarly, Executive may resign Executive’s employment at any time, with or without advance notice. Executive shall not receive any compensation of any kind, including, without limitation, stock option or other equity award vesting acceleration and severance benefits, following Executive’s termination of employment with the Company, except as expressly provided herein.

2. Severance Benefits.

(a) Severance Benefits upon a Termination in Connection with or Following a Change in Control. If Executive’s employment is terminated by the Company without Cause (as defined below, and other than as a result of death or disability), or Executive resigns his or her employment with the Company for Good Reason (as defined below), in either case within three (3) months prior to (and contingent upon the consummation of the Change in Control), in connection with, or within 12 months following the effective date of a Change in Control (a “CIC Termination”), and provided such termination constitutes a “separation from service” (within the meaning of Treasury Regulation Section 1.409A-1(h), a “Separation from Service”), and further provided that Executive delivers an effective release of claims as required under Section 3 below, then Executive shall be entitled to the following severance benefits (the “CIC Benefits”):

(i) The Company shall pay Executive a lump sum amount in cash equal to twelve (12) months of Executive’s then current base salary, ignoring any decrease in base salary that forms the basis for Good Reason, at the time specified in Section 3 below.

(ii) The Company shall pay Executive a lump sum amount in cash equal to 100% of Executive’s target bonus for the year in which the Separation from Service occurs, at the time specified in Section 3 below;

(iii) Subject to Section 9(c), the Company shall pay Executive’s expenses for continuing his or her health care coverage and that of any dependents who are covered at the time of the Executive’s Separation from Service (the “COBRA Premiums”) under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) for a period ending on the earlier of the twelve (12) month anniversary of the Separation from Service or the date on which Executive becomes eligible to be covered by the health care plans of another employer (the “CIC COBRA Period”), so long as Executive timely elects such COBRA continuation coverage.

(iv) All outstanding stock awards then held by Executive, including but not limited to stock options and restricted stock units, shall become fully vested with respect to all of the shares subject thereto, effective immediately prior to Executive’s Separation from Service under this Section 2(a).

(b) Severance Benefits upon a Termination that is not a CIC Termination. If Executive’s employment is terminated by the Company without Cause (other than as a result of death or disability), and such termination is not a CIC Termination, and provided such termination constitutes a Separation from Service and that Executive delivers an effective release of claims as required under Section 3 below, then Executive shall be entitled to the following severance benefits (the “Severance Benefits”):

(i) The Company shall pay Executive a lump sum amount in cash equal to [twelve (12) OR six (6)] months of Executive’s then current base salary, ignoring any decrease in base salary that forms the basis for Good Reason, at the time specified in Section 3 below.

(ii) The Company shall pay Executive a lump sum amount in cash equal to [100% OR 50%] of Executive’s target bonus for the year in which the Separation from Service occurs, at the time specified in Section 3 below; [and]

(iii) Subject to Section 9(c), the Company shall pay Executive’s COBRA Premiums for a period ending on the earlier of the [twelve (12) OR six (6)] month anniversary of the Separation from Service or the date on which Executive becomes eligible to be covered by the health care plans of another employer (the “Severance COBRA Period”), so long as Executive timely elects such COBRA continuation coverage[; and

(iv) All outstanding stock awards then held by Executive, including but not limited to stock options and restricted stock units, shall become vested with respect to 50% of the then unvested shares subject thereto, effective immediately prior to Executive’s Separation from Service under this Section 2(b).¹

¹  Note to draft: subsection (iv) to be included only in the CEO’s agreement.

2.

(c) Accrued Wages, Bonus and Vacation, Expenses. Without regard to the reason for, or the timing of, Executive’s termination of employment, the Company shall pay (or provide reimbursement to) Executive for (i) any unpaid base salary due for periods prior to and including the date of Separation from Service; (ii) all accrued and unused vacation through the date of Separation from Service, if applicable; (iii) any earned (as determined and approved by the Board prior to the Separation from Service) but not yet paid incentive bonus from the prior fiscal year, which bonus shall be paid in accordance with the Company’s regular bonus payment process and in any event by no later than two and one-half months after the end of such subsequent year; and (iv) following submission of proper expense reports by Executive, all expenses reasonably and necessarily incurred by Executive in connection with the business of the Company prior to the Separation from Service. These payments shall be made promptly upon or following termination and within the period of time mandated by law (or in the case of an earned bonus, within the time period set forth in the Company’s bonus plan and in any event by no later than two and one-half months after the end of the fiscal year following the year in which the bonus was earned).

3. Release Required; Timing of Payments.

(a) Requirement of Release. Prior to the payment of any CIC Benefits, Severance Benefits, or the Death Benefit (including the acceleration of equity, if applicable), Executive (or Executive’s estate or beneficiaries) shall execute and allow to become effective a standard employment release agreement releasing the Company (and its successor) from any and all claims Executive (or Executive’s estate or beneficiaries) may have against such entities related to or arising in connection with his or her employment and the terms of such employment and termination thereof (the “Release”) within the time frame set forth therein, but not later than 60 days following Executive’s Separation from Service (the “Release Effective Date”). No CIC or Severance Benefits shall be paid or provided prior to the Release Effective Date.

(b) Form of Release. The Release shall in substantially the form attached hereto as Exhibit A or Exhibit B, as applicable, and shall specifically relate to all of Executive’s (and Executive’s estate or beneficiaries) rights and claims in existence at the time of such execution and shall confirm Executive’s continuing obligations to the Company (including but not limited to obligations under any confidentiality and/or non-solicitation agreement with the Company). Unless a Change in Control has occurred, the Board, in its sole discretion, may modify the form of the required Release to comply with applicable law and shall determine the form of the required Release, which may be incorporated into a termination agreement or other agreement with Executive.

(c) Timing of Payments. Within five days following the Release Effective Date, the Company will pay (or commence payment of) the CIC Benefits or Severance Benefits Executive would otherwise have received on or prior to such date but for the delay in payment

3.

related to the effectiveness of the Release, with the balance of benefits being paid as scheduled. Notwithstanding the foregoing, if the Company (or, if applicable, the successor entity thereto) determines that any of the CIC Benefits or Severance Benefits constitute “deferred compensation” under Section 409A (defined below), then, solely to the extent necessary to avoid the incurrence of the adverse personal tax consequences under Section 409A, no CIC Benefits or Severance Benefits will be paid prior to the 60th day following Executive’s Separation from Service. On the 60th day following the date of Separation from Service, the Company will pay to Executive in a lump sum the CIC Benefits or Severance Benefits, as applicable, that Executive would otherwise have received on or prior to such date, with the balance of the CIC Benefits or Severance Benefits being paid as originally scheduled.

4. Limitation on Payments. If any payment or benefit (including payments and benefits pursuant to this Agreement) that Executive would receive in connection with a Change in Control from the Company or otherwise (“Transaction Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the Company shall cause to be determined, before any amounts of the Transaction Payment are paid to Executive, which of the following two alternative forms of payment would result in Executive’s receipt, on an after-tax basis, of the greater amount of the Transaction Payment notwithstanding that all or some portion of the Transaction Payment may be subject to the Excise Tax: (1) payment in full of the entire amount of the Transaction Payment (a “Full Payment”), or (2) payment of only a part of the Transaction Payment so that Executive receives the largest payment possible without the imposition of the Excise Tax (a “Reduced Payment”) . For purposes of determining whether to make a Full Payment or a Reduced Payment, the Company shall cause to be taken into account all applicable federal, state and local income and employment taxes and the Excise Tax (all computed at the highest applicable marginal rate, net of the maximum reduction in federal income taxes which could be obtained from a deduction of such state and local taxes). If a Reduced Payment is made, (x) Executive shall have no rights to any additional payments and/or benefits constituting the Transaction Payment, and (y) reduction in payments and/or benefits will occur in the following order: (1) reduction of cash payments; (2) cancellation of accelerated vesting of equity awards other than stock options; (3) cancellation of accelerated vesting of stock options; and (4) reduction of other benefits paid to Executive. In the event that acceleration of vesting of equity award compensation is to be reduced, such acceleration of vesting will be cancelled in the reverse order of the date of grant of Executive’s equity awards. In no event will the Company or any stockholder be liable to Executive for any amounts not paid as a result of the operation of this Section 4.

(a) The professional firm engaged by the Company for general tax purposes as of the day prior to the effective date of the Change in Control shall make all determinations required to be made under this Section 4. If the professional firm so engaged by the Company is serving as accountant or auditor for the individual, entity or group effecting the Change in Control, the Company shall appoint a nationally recognized independent registered public accounting firm to make the determinations required hereunder. The Company shall bear all expenses with respect to the determinations by such professional firm required to be made hereunder.

4.

(b) The professional firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and Executive within 15 calendar days after the date on which Executive’s right to a Transaction Payment is triggered or such other time as reasonably requested by the Company or Executive. If the professional firm determines that no Excise Tax is payable with respect to the Transaction Payment, either before or after the application of the Reduced Amount, it shall furnish the Company and Executive with detailed supporting calculations of its determinations that no Excise Tax will be imposed with respect to such Transaction Payment. Any good faith determinations of the professional firm made hereunder shall be final, binding and conclusive upon the Company and Executive.

5. Successors.

(a) Company’s Successors. Any successor to the Company (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company’s business and/or assets shall assume the Company’s, or ensure that the Company fully performs its, obligations under this Agreement and shall perform the Company’s, or ensure that the Company performs its, obligations, under this Agreement in the same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession. For all purposes under this Agreement, the term “Company” shall include any such successor.

(b) Executive’s Successors. Without the written consent of the Company, Executive shall not assign or transfer any right or obligation under this Agreement to any other person or entity. Notwithstanding the foregoing, the terms of this Agreement and all rights of Executive hereunder shall inure to the benefit of, and be enforceable by, Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.

6. Notices.

(a) General. Notices and all other communications contemplated by this Agreement shall be in writing and shall be deemed to have been duly given when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of Executive, mailed notices shall be addressed to him at the home address which he most recently communicated to the Company in writing. In the case of the Company, mailed notices shall be addressed to its corporate headquarters, and all notices shall be directed to the attention of its Secretary.

(b) Notice of Termination. Any termination by the Company with or without Cause or by Executive as a result of a voluntary resignation for any reason shall be communicated by a notice of termination to the other party hereto given in accordance with this Agreement.

7. Arbitration. The Company and Executive shall attempt to settle any disputes arising in connection with this Agreement through good faith consultation. In the event that Executive and the Company are not able to resolve any such disputes within 15 days after notification in

5.

writing to the other, any dispute or claim arising out of or in connection with this Agreement will be finally settled by binding arbitration in San Jose, California in accordance with the rules of the American Arbitration Association by one arbitrator mutually agreed upon by the parties. The arbitrator will apply California law, without reference to rules of conflicts of law or rules of statutory arbitration, to the resolution of any dispute. Except as set forth in Section 9(i) below, the arbitrator shall not have authority to modify the terms of this Agreement. The Company shall pay the costs of the arbitration proceeding. Each party shall, unless otherwise determined by the arbitrator, bear its or his or her own attorneys’ fees and expenses, provided however that if Executive prevails in an arbitration proceeding, the Company shall reimburse Executive for his or her reasonable attorneys’ fees and costs. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Notwithstanding the foregoing, the Company and Executive may apply to any court of competent jurisdiction for preliminary or interim equitable relief, or to compel arbitration in accordance with this paragraph, without breach of this arbitration provision.

8. Definition of Terms. The following terms referred to in this Agreement shall have the following meanings:

(a) Cause. “Cause” for termination of Executive’s employment will exist if Executive is terminated by the Company for any of the following reasons: (i) Executive’s willful failure substantially to perform his or her duties and responsibilities to the Company or deliberate violation of a Company policy; (ii) Executive’s commission of any act of fraud, embezzlement, dishonesty or any other willful misconduct that has caused or is reasonably expected to result in material injury to the Company; (iii) unauthorized use or disclosure by Executive of any proprietary information or trade secrets of the Company or any other party to whom Executive owes an obligation of nondisclosure as a result of his or her relationship with the Company; or (iv) Executive’s willful breach of any of his or her obligations under any written agreement or covenant with the Company, including but not limited to Executive’s Confidential Information and Invention Assignment Agreement. The determination as to whether Executive is being terminated for Cause shall be made in good faith by the Company and shall be final and binding on Executive. The term “Company” will be interpreted to include any subsidiary, parent or affiliate of the Company, as appropriate.

(b) Change in Control. “Change in Control” shall have the meaning set forth in the Company’s 2014 Equity Incentive Plan, as it may be amended from time to time; provided that to the extent required for compliance with Section 409A of the Code, in no event will a Change in Control be deemed to have occurred if such transaction is not also a “change in the ownership or effective control of” the Company or “a change in the ownership of a substantial portion of the assets of” the Company as determined under Treasury Regulations Section 1.409A-3(i)(5) (without regard to any alternative definition thereunder).

(c) Good Reason. “Good Reason” for Executive’s resignation of his or her employment shall exist following the occurrence of any of the following without Executive’s

6.

written consent: (i) a material reduction in job duties, responsibilities, title or authority inconsistent with the Executive’s position with the Company; provided, however, that any such reduction or change (including a change in title) after a Change in Control will not constitute Good Reason if Executive retains reasonably comparable duties, position and responsibilities with respect to the Company’s business within the successor entity following a Change of Control; (ii) a material reduction of Executive’s then current base salary, representing a reduction of more than 10% of the Executive’s then current base salary; provided, that an across-the-board reduction in the salary level of all executive officers of the Company by the same percentage amount as part of a general salary level reduction implemented prior to a Change in Control shall not constitute such a material salary reduction; (iii) the relocation of Executive’s principal place of employment to a place that increases Executive’s one-way commute by more than 35 miles as compared to Executive’s then current principal place of employment immediately prior to such relocation; (iv) any material breach by the Company of this Agreement or any other written agreement between the Company and the Executive; or (v) the failure by any successor to the Company to assume this Agreement or any obligations under this Agreement; provided, that the Executive gives written notice to the Company of the event forming the basis of the termination for Good Reason within 60 days after the date on which the Company gives written notice to the Executive of the Company’s affirmative decision to take an action set forth in clause (i), (ii), (iii), (iv) or (v) above, the Company fails to cure such basis for the Good Reason resignation within 30 days after receipt of Executive’s written notice and Executive terminates his or her employment within 30 days following the expiration of the cure period.

9. Miscellaneous Provisions.

(a) Executive Obligations. Notwithstanding anything to the contrary contained herein, payment of any of the CIC Benefits or Severance Benefits will be conditioned upon (i) Executive continuing to comply with his or her obligations under the Proprietary Information and Inventions Agreement (or such similar form that Executive previously executed in connection with his or her employment employment) during the period of time in which Executive is receiving the CIC Benefits or Severance Benefits; and (ii) Executive’s resignation from all positions with the Company, any subsidiaries and affiliates, and the Board (as applicable), to be effective no later than the date of Separation from Service (or such other date as determined by the Board).

(b) Income and Employment Taxes. All amounts paid or provided under this Agreement shall be net of required withholdings, and Executive shall be responsible for any additional taxes of any nature (including any penalties or interest that may apply to such taxes) that the Company reasonably determines apply to any payment made hereunder. Executive’s receipt of any benefit hereunder is conditioned on his or her satisfaction of any applicable withholding or similar obligations that apply to such benefit and any cash payment owed hereunder will be reduced to satisfy any such withholding or similar obligations that may apply.

(c) Alternative Method of Providing COBRA Benefit. If the Company determines, in its sole discretion, that the Company cannot pay COBRA Premiums as provided in Section 2(a) or 2(b) without potentially incurring financial costs or penalties under applicable law (including, without limitation, Section 2716 of the Public Health Service Act), the Company shall in lieu thereof pay Executive a taxable cash amount, which payment shall be made

7.

regardless of whether Executive or Executive’s eligible family members elect health care continuation coverage (the “Health Care Benefit Payment”). The Health Care Benefit Payment shall be paid in monthly installments on the same schedule and over the same time period that the COBRA Premiums would otherwise have been paid on behalf of the Executive. The Health Care Benefit Payment shall be equal to the amount that the Company would have otherwise paid for COBRA Premiums (which amount shall be calculated based on the premium for the first month of coverage), and shall be paid until the expiration of the CIC COBRA Period or the Severance COBRA Period, as applicable.

(d) No Duty to Mitigate. Executive shall not be required to mitigate the amount of any payment contemplated by this Agreement, nor shall any such payment be reduced by any earnings that Executive may receive from any other source.

(e) Interaction with Other CIC Benefits. In the event that Executive would be entitled to a greater level of CIC Benefits under the terms and conditions of an individual stock option agreement with the Company or a severance plan or policy provided by the Company or its successor to other Company employees being terminated within three months prior to (and contingent upon the consummation of the Change in Control), in connection with, or within 12 months following a Change in Control but for the existence of this Agreement, Executive shall be entitled to receive the greater of the CIC Benefits or the benefits under such other agreement, plan or policy subject to the applicable terms and conditions thereof.

(f) Waiver. No provision of this Agreement may be waived or discharged unless the waiver or discharge is agreed to in writing and signed by the Executive and by an authorized officer of the Company (other than Executive). No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other party shall be considered a waiver of any other condition or provision or of the same condition or provision at another time.

(g) Integration. This Agreement supersedes all prior or contemporaneous agreements, whether written or oral, with respect to this Agreement, [including but not limited to the                      Agreement entered into as of             ,         , by and between the Company and Executive]³; provided that, for clarification purposes, this Agreement shall not affect any agreements between the Company and Executive regarding intellectual property matters, non-solicitation or non-competition restrictions or confidential information of the Company.

(h) Choice of Law. The validity, interpretation, construction and performance of this Agreement shall be governed by the internal substantive laws, but not the conflicts of law rules, of the State of California.

³  Note: customize reference to current agreement (e.g., employment agreement) for each executive.

8.

(i) Severability. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision hereof, which shall remain in full force and effect.

(j) Code Section 409A. It is intended that each installment of the payments and benefits provided for in this Agreement is a separate “payment” for purposes of Treasury Regulation Section 1.409A-2(b)(2)(i). For the avoidance of doubt, it is intended that payments of the amounts set forth in this Agreement satisfy, to the greatest extent possible, the exemptions from the application of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) (Section 409A of the Code, together, with any state law of similar effect, “Section 409A”) provided under Treasury Regulations 1.409A-1(b)(4), 1.409A-1(b)(5) and 1.409A-1(b)(9). However, if the Company (or, if applicable, the successor entity thereto) determines that the severance payments and benefits provided under this Agreement (the “Agreement Payments”) constitute “deferred compensation” under Section 409A and Executive is, on the date of his or her Separation from Service, a “specified employee” of the Company or any successor entity thereto, as such term is defined in Section 409A(a)(2)(B)(i) of the Code (a “Specified Employee”), then, solely to the extent necessary to avoid the incurrence of the adverse personal tax consequences under Section 409A, the timing of the Severance Benefits described in Section 4(b) shall be delayed as follows: on the earlier to occur of (i) the date that is six months and one day after Executive’s Separation from Service or (ii) the date of Executive’s death (such earlier date, the “Delayed Initial Payment Date”), the Company (or the successor entity thereto, as applicable) shall pay to Executive a lump sum amount equal to the applicable benefit that Executive would otherwise have received through the Delayed Initial Payment Date if the commencement of the payment of the benefit had not been so delayed pursuant to this Section 9(j).

(k) Legal Fees and Expenses. The parties shall each bear their own expenses, legal fees and other fees incurred in connection with the execution of this Agreement.

(l) Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together will constitute one and the same instrument.

[Signature Page Follows]

9.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above.

EXECUTIVE

[NAME]

Date:

eASIC CORPORATION

By:

Name:

Title:

Date:

For Executive Age 40 or Older

Group Termination

EXHIBIT A

RELEASE AGREEMENT

In consideration of receiving certain benefits under my Change in Control and Severance Agreement with eASIC Corporation (the “Company”) dated [            ] (the “Agreement”), I have agreed to sign this Release. I understand that I am not entitled to benefits under the Agreement unless I sign this Release.

I understand that this Release, together with the Agreement, constitutes the complete, final and exclusive embodiment of the entire agreement between the Company, affiliates of the Company and me with regard to the subject matter hereof. I am not relying on any promise or representation by the Company that is not expressly stated therein. Certain capitalized terms used in this Release are defined in the Agreement.

I hereby confirm my obligations under my [Confidential Information and Invention Assignment Agreement] (or such similar form that I previously executed in connection with my employment) with the Company, including but not limited to the nonsolicitation of employees covenant set forth in such agreement.

Except as otherwise set forth in this Release, I hereby generally and completely release the Company and its current and former directors, officers, executives, stockholders, stockholders, partners, agents, attorneys, predecessors, successors, parent and subsidiary entities, insurers, affiliates, and assigns (collectively, the “Released Parties”) from any and all claims, liabilities and obligations, both known and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring prior to my signing this Release (collectively, the “Released Claims”). The Released Claims include, but are not limited to: (1) all claims arising out of or in any way related to my employment with the Company or its affiliates, or the termination of that employment; (2) all claims related to my compensation or benefits, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership interests in the Company or its affiliates; (3) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; (4) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (5) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Age Discrimination in Employment Act of 1967 (as amended) (“ADEA”), the federal Employee Retirement Income Security Act of 1974 (as amended), and the California Fair Employment and Housing Act (as amended). Notwithstanding the foregoing, the following are not included in the Released Claims (the “Excluded Claims”): (1) any rights or claims for indemnification I may have pursuant to any written indemnification agreement with the Company to which I am a party, the charter or bylaws of the Company, or under applicable law; (2) any rights related to vested securities of the Company that were granted to me during the course of my employment with the Company or any shares of capital stock or other securities of the Company that I purchased other than pursuant to a Company stock option

-1-

For Executive Age 40 or Older

Group Termination

or stock plan; or (3) any rights which are not waivable as a matter of law. In addition, nothing in this Release prevents me from filing, cooperating with, or participating in any proceeding before the Equal Employment Opportunity Commission, the Department of Labor, the California Department of Fair Employment and Housing, or any other local, state, or federal administrative body or government agency that is authorized to enforce or administer laws related to employment, against the Company, except that I hereby waive my right to any monetary benefits in connection with any such claim, charge or proceeding. I hereby represent and warrant that, other than the Excluded Claims, I am not aware of any claims I have or might have against any of the Released Parties that are not included in the Released Claims.

I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have under the ADEA. I also acknowledge that the consideration given for the Released Claims is in addition to anything of value to which I was already entitled. I further acknowledge that I have been advised by this writing, as required by the ADEA, that: (a) the Released Claims do not apply to any rights or claims that arise after the date I sign this Release; (b) I should consult with an attorney prior to signing this Release (although I may choose voluntarily not to do so); (c) I have forty-five (45) days to consider this Release (although I may choose to voluntarily sign it sooner); (d) I have seven (7) days following the date I sign this Release to revoke the Release by providing written notice to an officer of the Company; and (e) the Release will not be effective until the date upon which the revocation period has expired unexercised, which will be the eighth day after I sign this Release (“Effective Date”).

I have received with this Release all of the information required by the ADEA, including without limitation a detailed list of the job titles and ages of all employees who were terminated in this group termination and the ages of all employees of the Company in the same job classification or organizational unit who were not terminated, along with information on the eligibility factors used to select employees for the group termination and any time limits applicable to this group termination program.

I acknowledge that I have read and understand Section 1542 of the California Civil Code which reads as follows: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.” I hereby expressly waive and relinquish all rights and benefits under that section and any law of any jurisdiction of similar effect with respect to my release of any claims hereunder.

I hereby represent that I have been paid all compensation owed and for all hours worked, I have received all the leave and leave benefits and protections for which I am eligible, and I have not suffered any on-the-job injury for which I have not already filed a workers’ compensation claim.

I hereby agree not to disparage the Company, or its officers, directors, executives, stockholders or agents, in any manner likely to be harmful to its or their business, business reputation, or personal reputation; provided, however, that I will respond accurately and fully to any question, inquiry or request for information when required by legal process.

-2-

For Executive Age 40 or Older

Group Termination

I acknowledge that to become effective, I must sign and return this Release to the Company so that it is received not later than forty-five (45) days following the date it is provided to me, and I must not revoke it thereafter.

[EXECUTIVE NAME]

Date:

-3-

For Executive Age 40 or Older

Individual Termination

EXHIBIT B

RELEASE AGREEMENT

In consideration of receiving certain benefits under my Change in Control and Severance Agreement with eASIC Corporation (the “Company”) dated [            ] (the “Agreement”), I have agreed to sign this Release. I understand that I am not entitled to benefits under the Agreement unless I sign this Release.

I understand that this Release, together with the Agreement, constitutes the complete, final and exclusive embodiment of the entire agreement between the Company, affiliates of the Company and me with regard to the subject matter hereof. I am not relying on any promise or representation by the Company that is not expressly stated therein. Certain capitalized terms used in this Release are defined in the Agreement.

I hereby confirm my obligations under my [Confidential Information and Invention Assignment Agreement] (or such similar form that I previously executed in connection with my employment) with the Company, including but not limited to the nonsolicitation of employees covenant set forth in such agreement.

Except as otherwise set forth in this Release, I hereby generally and completely release the Company and its current and former directors, officers, executives, stockholders, stockholders, partners, agents, attorneys, predecessors, successors, parent and subsidiary entities, insurers, affiliates, and assigns (collectively, the “Released Parties”) from any and all claims, liabilities and obligations, both known and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring prior to my signing this Release (collectively, the “Released Claims”). The Released Claims include, but are not limited to: (1) all claims arising out of or in any way related to my employment with the Company or its affiliates, or the termination of that employment; (2) all claims related to my compensation or benefits, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership interests in the Company or its affiliates; (3) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; (4) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (5) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Age Discrimination in Employment Act of 1967 (as amended) (“ADEA”), the federal Executive Retirement Income Security Act of 1974 (as amended), and the California Fair Employment and Housing Act (as amended). Notwithstanding the foregoing, the following are not included in the Released Claims (the “Excluded Claims”): (1) any rights or claims for indemnification I may have pursuant to any written indemnification agreement with the Company to which I am a party, the charter or bylaws of the Company, or under applicable law; (2) any rights related to vested securities of the Company that were granted to me during the course of my employment with the Company or any shares of capital stock or other securities of the Company that I purchased other than pursuant to a Company stock option or stock plan; or (3) any rights which are not waivable as a matter of law. In addition, nothing in this Release prevents me from filing, cooperating with, or participating in any

For Executive Age 40 or Older

Individual Termination

proceeding before the Equal Employment Opportunity Commission, the Department of Labor, the California Department of Fair Employment and Housing, or any other local, state, or federal administrative body or government agency that is authorized to enforce or administer laws related to employment, against the Company, except that I hereby waive my right to any monetary benefits in connection with any such claim, charge or proceeding. I hereby represent and warrant that, other than the Excluded Claims, I am not aware of any claims I have or might have against any of the Released Parties that are not included in the Released Claims.

I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have under the ADEA. I also acknowledge that the consideration given for the Released Claims is in addition to anything of value to which I was already entitled. I further acknowledge that I have been advised by this writing, as required by the ADEA, that: (a) the Released Claims do not apply to any rights or claims that arise after the date I sign this Release; (b) I should consult with an attorney prior to signing this Release (although I may choose voluntarily not to do so); (c) I have twenty-one (21) days to consider this Release (although I may choose to voluntarily sign it sooner); (d) I have seven (7) days following the date I sign this Release to revoke the Release by providing written notice to an officer of the Company; and (e) the Release will not be effective until the date upon which the revocation period has expired unexercised, which will be the eighth day after I sign this Release (“Effective Date”).

I acknowledge that I have read and understand Section 1542 of the California Civil Code which reads as follows: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.” I hereby expressly waive and relinquish all rights and benefits under that section and any law of any jurisdiction of similar effect with respect to my release of any claims hereunder.

I hereby represent that I have been paid all compensation owed and for all hours worked, I have received all the leave and leave benefits and protections for which I am eligible, and I have not suffered any on-the-job injury for which I have not already filed a workers’ compensation claim.

I hereby agree not to disparage the Company, or its officers, directors, executives, stockholders or agents, in any manner likely to be harmful to its or their business, business reputation, or personal reputation; provided, however, that I will respond accurately and fully to any question, inquiry or request for information when required by legal process.

I acknowledge that to become effective, I must sign and return this Release to the Company so that it is received not later than twenty-one (21) days following the date it is provided to me, and I must not revoke it thereafter.

[EXECUTIVE NAME]

Date:

-2-

EX-10.22

Exhibit 10.22

LEASE

BETWEEN

FREEDOM CIRCLE LLC

AND

EASIC CORPORATION

LEASE

THIS LEASE is made as of July 20, 2015, by and between FREEDOM CIRCLE LLC, a Delaware limited liability company, hereafter called “Landlord,” and EASIC CORPORATION, a Delaware corporation, hereafter called “Tenant,”

ARTICLE 1. BASIC LEASE PROVISIONS

Each reference in this Lease to the “Basic Lease Provisions” shall mean and refer to the following collective terms, the application of which shall be governed by the provisions in the remaining Articles of this Lease.

1.	Tenant’s Trade Name:	N/A
2.	Premises:	The Premises are more particularly described in Section 2.1
	Address of Building:	3940 Freedom Circle, Santa Clara, CA 95054
	Project Description	Technology Park at Freedom Circle (as shown on Exhibit Y to this Lease)
3.	Use of Premises: General office, research and development, training, computer lab, and shipping and receiving
4.	Estimated Commencement Date: 12 weeks from and after the date of this Lease
5.	Lease Term: 60 months, plus such additional days as may be required to cause this Lease to expire on the final day of the calendar month.
6.	Basic Rent:

Months of Term or Period	Monthly Rate Per Rentable Square Foot	Monthly Basic Rent (rounded to the nearest dollar)
1 to 26	$2.25	$50,625.00
27 to 36	$2.32	$52,200.00
37 to 48	$2.39	$53,775.00
49 to 60	$2.46	$55,350.00

7.	Expense Recovery Period: Every twelve month period during the Term (or portion thereof during the first and last Lease years) ending June 30.
8.	Floor Area of Premises: approximately 22,500 rentable square feet Floor Area of Building: approximately 22,500 rentable square feet
9.	Security Deposit: $80,588.00
10.	Broker(s): Irvine Realty Company (“Landlord’s Broker”) is the agent of Landlord exclusively and CBRE, Inc. (“Tenant’s Broker”) is the agent of Tenant exclusively.
11.	Parking: 74 parking spaces in accordance with the provisions set forth in Exhibit F to this Lease.

1.

12. Address for Payments and Notices:

LANDLORD	TENANT
Payment Address:	Notice Address:
	Prior to the Commencement Date:
FREEDOM CIRCLE LLC P.O. Box #01194 San Francisco, CA 94139-0001	EASIC CORPORATION 2585 Augustine Drive, Suite 100 Santa Clara. CA 95054 Attention: General Counsel
Notice Address:
THE IRVINE COMPANY LLC 550 Newport Center Drive Newport Beach, CA 92660 Attn: Senior Vice President, Property Operations          Irvine Office Properties with a copy of notices to:	After the Commencement Date: EASIC CORPORATION 3940 Freedom Circle Santa Clara, CA 95054 Attention: General Counsel
THE IRVINE COMPANY LLC 550 Newport Center Drive Newport Beach, CA 92660 Attn: Senior Vice President, Property Operations Irvine Office Properties

LIST OF LEASE EXHIBITS (All exhibits, riders and addenda attached to this Lease are hereby incorporated into and made a part of this Lease):

Exhibit A	Description of Premises
Exhibit B	Operating Expenses
Exhibit C	Utilities and Services
Exhibit D	Tenants Insurance
Exhibit E	Rules and Regulations
Exhibit F	Parking
Exhibit G	Additional Provisions
Exhibit H	Hazardous Materials Disclosure Statement
Exhibit I	[intentionally Deleted]
Exhibit J	Survey Form
Exhibit X	Work Letter
Exhibit Y	Project Description

2.

ARTICLE 2. PREMISES

2.1 LEASED PREMISES. Landlord leases to Tenant and Tenant leases from Landlord the Premises shown in Exhibit A (the “Premises”), containing approximately the floor area set forth in Item 8 of the Basic Lease Provisions (the “Floor Area”). The Premises are located in the building identified in Item 2 of the Basic Lease Provisions (the “Building”), which is a portion of the project described in Item 2 (the “Project”). Landlord and Tenant stipulate and agree that the Floor Area of Premises set forth in Item 8 of the Basic Lease Provisions is correct.

2.2 ACCEPTANCE OF PREMISES. Tenant acknowledges that neither Landlord nor any representative of Landlord has made any representation or warranty with respect to the Premises, the Building or the Project or the suitability or fitness of either for any purpose, except as set forth in this Lease (including the exhibits hereto). Notwithstanding the foregoing, Landlord shall deliver possession of the Premises to Tenant on the Commencement Date (defined below) with the Tenant Improvements and Building systems in good condition and repair, and the Premises shall be broom-clean. Except as disclosed in Section 5.3(f) below, Landlord warrants that, to “Landlord’s knowledge” (as hereinafter defined), there are no Hazardous Materials in or about the Premises which are in violation of any applicable federal, state or local law, ordinance or regulation. As used herein, “Landlord’s knowledge” shall mean the actual knowledge, without duty of inquiry or investigation, of the current employees or authorized agents of Landlord responsible for Hazardous Materials compliance matters. Tenant acknowledges that the flooring materials which may be installed within portions of the Premises located on the ground floor of the Building may be limited by the moisture content of the Building slab and underlying soils. The taking of possession or use of the Premises by Tenant for any purpose other than construction shall conclusively establish that the Premises and the Building were in satisfactory condition and in conformity with the provisions of this Lease In all respects, except for those matters which Tenant shall have brought to Landlord’s attention on a written punch list and except as otherwise provided in Section 1 of Exhibit G attached to this Lease. The punch list shall be limited to any items required to be accomplished by Landlord under the Work Letter attached as Exhibit X, and shall be delivered to Landlord within 60 days after the Commencement Date (as defined herein). Nothing contained in this Section 2.2 shall affect the commencement of the Term or the obligation of Tenant to pay rent. Landlord shall diligently complete all punch list items of which it is notified as provided above.

ARTICLE 3. TERM

3.1 GENERAL. The term of this Lease (“Term”) shall be for the period shown in Item 5 of the Basic Lease Provisions, The Term shall commence (“Commencement Date”) on the earlier of (a) ten (10) business days after the Premises are deemed “ready for occupancy” (as hereinafter defined) and possession thereof is delivered to Tenant or (b) the date Tenant commences its regular business activities within the Premises. Promptly following the occurrence of the Commencement Date, the parties shall memorialize on a form provided by Landlord (the “Commencement Memorandum”) the actual Commencement Date and the expiration date (“Expiration Date”) of this Lease; should Tenant fail to execute and return the Commencement Memorandum to Landlord within 10 business days (or provide specific written objections thereto within that period), then Landlord’s determination of the Commencement and Expiration Dates as set forth in the Commencement Memorandum shall be conclusive. The Premises shall be deemed “ready for occupancy” when Landlord has substantially completed all the work required to be completed by Landlord pursuant to the Work Letter attached to this Lease but for minor punch list matters, and has obtained the requisite governmental approvals for Tenant’s occupancy in connection with such work.

3.2 DELAY IN POSSESSION. If Landlord, for any reason whatsoever, cannot deliver possession of the Premises to Tenant on or before the Estimated Commencement Date set forth in Item 4 of the Basic Lease Provisions, this Lease shall not be void or voidable nor shall Landlord be liable to Tenant for any resulting loss or damage. However, Tenant shall not be liable for any rent until the Commencement Date occurs as provided in Section 3.1 above, except that if Landlord’s failure to substantially complete all work required of Landlord pursuant to the Work Letter attached to this Lease is attributable to any Tenant Delay described therein, then the Premises shall be deemed ready for occupancy, and Landlord shall be

3.

entitled to full performance by Tenant (including the payment of rent), as of the date Landlord would have been able to substantially complete such work and deliver the Premises to Tenant but for such Tenant Delay.

ARTICLE 4. RENT AND OPERATING EXPENSES

4.1 BASIC RENT. From and after the Commencement Date, Tenant shall pay to Landlord without deduction or offset, except as otherwise expressly provided for herein, a Basic Rent for the Premises in the total amount shown (including subsequent adjustments, if any) in Item 6 of the Basic Lease Provisions (the “Basic Rent”). If the Commencement Date is other than the first day of a calendar month, any rental adjustment shown in Item 6 shall be deemed to occur on the first day of the next calendar month following the specified monthly anniversary of the Commencement Date. The Basic Rent shall be due and payable in advance commencing on the Commencement Date and continuing thereafter on the first day of each successive calendar month of the Term, as prorated for any partial month. No demand, notice or invoice shall be required.

4.2 OPERATING EXPENSES. Tenant shall pay Tenant’s Share of Operating Expenses in accordance with Exhibit B of this Lease.

4.3 SECURITY DEPOSIT. Landlord acknowledges that, concurrently with Tenant’s delivery of this Lease, Landlord has received the sum stated in Item 9 of the Basic Lease Provisions (the “Security Deposit”), to be held by Landlord as security for the full and faithful performance of Tenant’s obligations under this Lease, to pay any rental sums, including without limitation such additional rent as may be owing under any provision hereof, and to maintain the Premises as required by Sections 7.1 and 15.2 or any other provision of this Lease. Upon any breach of the foregoing obligations by Tenant, Landlord may apply all or part of the Security Deposit as full or partial compensation. If any portion of the Security Deposit is so applied, Tenant shall within 5 days after written demand by Landlord deposit cash with Landlord in an amount sufficient to restore the Security Deposit to its original amount. Landlord shall not be required to keep the Security Deposit separate from its general funds, and Tenant shall not be entitled to interest on the Security Deposit. In no event may Tenant utilize all or any portion of the Security Deposit as a payment toward any rental sum due under this Lease. Any unapplied balance of the Security Deposit shall be returned to Tenant or, at Landlord’s option, to the last assignee of Tenant’s interest in this Lease within 30 days following the termination of this Lease and Tenant’s vacation of the Premises. Tenant hereby waives the provisions of Section 1950.7 of the California Civil Code, or any similar or successor laws now or hereafter in effect, in connection with Landlord’s application of the Security Deposit to prospective rent that would have been payable by Tenant but for the early termination due to Tenant’s Default (as defined herein).

Landlord’s affiliate, Augustine Drive LLC (“Augustine Drive”), currently holds an amount of $80,588.00 as a “Security Deposit” under an existing lease (the “Existing Lease”) between Augustine Drive and Tenant. Landlord and Tenant agree that, rather than returning to Tenant the Security Deposit held by Augustine Drive pursuant to the Existing Lease, Landlord shall transfer such “Security Deposit” to be held by Landlord as the Security Deposit under this Lease.

ARTICLE 5. USES

5.1 USE. Tenant shall use the Premises only for the purposes stated in Item 3 of the Basic Lease Provisions and for no other use whatsoever. The uses prohibited under this Lease shall include, without limitation, use of the Premises or a portion thereof for (i) offices of any agency or bureau of the United States or any state or political subdivision thereof; (ii) offices or agencies of any foreign governmental or political subdivision thereof; or (iii) schools, temporary employment agencies or other training facilities which are not ancillary to corporate, executive or professional office use. Tenant shall not do or permit anything to be done in or about the Premises which will in any way materially interfere with the rights or quiet enjoyment of other occupants of the Project, or use or allow the Premises to be used for any unlawful purpose, nor shall Tenant permit any nuisance or commit any waste in the Premises or the Project. Tenant shall not perform any work or conduct any business whatsoever in the Project other than

4.

inside the Premises. Tenant shall comply at its expense with all present and future laws, ordinances and requirements of all governmental authorities that pertain to Tenant’s use of the Premises, and with all energy usage reporting requirements of Landlord. As of the date of this Lease, there has been no inspection of the Building and Project by a Certified Access Specialist as referenced in Section 1938 of the California Civil Code.

5.2 SIGNS. Tenant shall have the right to exterior signage displaying Tenant’s name and graphics as follows: (i) one (1) exterior panel on the monument sign for the Building in a location designated by Landlord and (ii) one (1) position on each of the two (2) non-exclusive Project monument signs at the corners of Mission College Boulevard and Freedom Circle, subject to Landlord’s right of prior approval that such exterior signage is in compliance with the Signage Criteria (defined below). The design of such exterior signage shall be subject to Tenant’s approval, and Landlord, at its sole cost and expense, shall be responsible for all costs of such exterior signage, including, without limitation, the fabrication, installation as part of Landlord’s Work prior to the Commencement Date, maintenance and removal thereof and the cost of any permits therefor. Except as provided in the foregoing Tenant shall have no right to maintain any additional exterior signs. With respect to interior signage, Tenant shall not place or erect any signs that are visible (except as approved as part of the Tenant Improvements) to any material extent from the exterior of the Building. The size, design, graphics, material, style, color and other physical aspects of any exterior signage shall be subject to Landlord’s reasonable determination prior to installation, that signage is in compliance with any covenants, conditions or restrictions encumbering the Premises and Landlord’s signage program for the Project, as in effect from time to time and approved by the City in which the Premises are located (“Signage Criteria”). Landlord shall have the right to temporarily remove any signs in connection with any repairs or maintenance in or upon the Building. The term “sign” as used in this Section shall include all signs, designs, monuments, displays, advertising materials, logos, banners, projected images, pennants, decals, pictures, notices, lettering, numerals or graphics. Tenant’s exterior signage rights to the Project monument signs under this Section 5.2 belong solely to eASIC Corporation, a Delaware corporation, and any transferee under a Permitted Transfer, and any attempted assignment or transfer of such rights shall be void and of no force and effect.

In addition to the foregoing, from and after the Commencement Date and continuing through October 31, 2016, Landlord shall pay the standard advertising rates charged for Tenant advertising on each side of the jumbotron sign located on Highway 101 across from the Project (“Jumbotron Sign”). The parties acknowledge that the Jumbotron Sign is not owned by Landlord and Tenant’s use of and the permitted content on the Jumbotron Sign is subject to availability and approval as determined by the owner/operator (“Owner”) of the Jumbotron sign. Landlord shall either directly contract with Owner or, at Landlord’s option, reimburse Tenant for such standard advertising rates.

5.3 HAZARDOUS MATERIALS.

(a) For purposes of this Lease, the term “Hazardous Materials” means (i) any “hazardous material” as defined in Section 25501(o) of the California Health and Safety Code, (ii) hydrocarbons, polychlorinated biphenyls or asbestos, (iii) any toxic or hazardous materials, substances, wastes or materials as defined pursuant to any other applicable state, federal or local law or regulation, and (iv) any other substance or matter which may result in liability to any person or entity as a result of such person’s possession, use, storage, release or distribution of such substance or matter under any statutory or common law theory.

(b) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released or disposed of on, under, from or about the Premises (including without limitation the soil and groundwater thereunder) without the prior written consent of Landlord, which consent may be given or withheld in Landlord’s sole and absolute discretion. Notwithstanding the foregoing, Tenant shall have the right, without obtaining prior written consent of Landlord, to utilize within the Premises a reasonable quantity of standard office products that may contain Hazardous Materials (such as photocopy toner, “White Out”, and the like), provided however, that (i) Tenant shall maintain such products in their original retail packaging, shall follow all instructions on such packaging with respect to the storage, use and disposal of such products, and shall otherwise comply with all applicable laws

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with respect to such products, and (ii) all of the other terms and provisions of this Section 5.3 shall apply with respect to Tenant’s storage, use and disposal of all such products. Landlord may place such conditions as Landlord reasonably deems appropriate with respect to Tenant’s use, storage and/or disposal of any Hazardous Materials requiring Landlord’s consent. Tenant understands that Landlord may utilize an environmental consultant to assist in determining conditions of approval in connection with the storage, use, release, and/or disposal of Hazardous Materials by Tenant on or about the Premises (so long as such inspections are scheduled with Tenant in advance and do not unreasonably interfere with Tenant’s operations in the Premises), and/or to conduct periodic inspections of the storage, generation, use, release and/or disposal of such Hazardous Materials by Tenant on and from the Premises, and Tenant agrees that any costs reasonably incurred by Landlord in connection therewith shall be reimbursed by Tenant to Landlord as additional rent hereunder within 30 days of Landlord’s demand.

(c) Prior to the execution of this Lease, Tenant shall complete, execute and deliver to Landlord a Hazardous Material Survey Form (the “Survey Form”) in the form of Exhibit J attached hereto. The completed Survey Form shall be deemed incorporated into this Lease for all purposes, and Landlord shall be entitled to rely fully on the information contained therein. Following Landlord’s written request therefor given on or after each anniversary of the Commencement Date until the expiration or sooner termination of this Lease, Tenant shall disclose to Landlord in writing the names and amounts of all Hazardous Materials which were stored, generated, used, released and/or disposed of on, under or about the Premises for the twelve-month period prior thereto (other than any such Hazardous Materials that may have been utilized in de minimis quantities), and which Tenant desires to store, generate, use, release and/or dispose of on, under or about the Premises for the succeeding twelve-month period. In addition, to the extent Tenant is permitted to utilize Hazardous Materials upon the Premises, Tenant shall promptly provide Landlord with complete and legible copies of all the following environmental documents relating thereto: reports filed pursuant to any self-reporting requirements; permit applications, permits, monitoring reports, emergency response or action plans, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (even those which may be characterized as confidential so long as Landlord executes a commercially reasonable nondisclosure agreement as may reasonably be required by Tenant with respect to the delivery of such confidential information) relating to water discharges, air pollution, waste generation or disposal, and underground storage tanks for Hazardous Materials; orders, reports, notices, listings and correspondence (even those which may be considered confidential so long as Landlord executes a commercially reasonable nondisclosure agreement as may reasonably be required by Tenant with respect to the delivery of such confidential information) of or concerning the release, investigation, compliance, cleanup, remedial and corrective actions, and abatement of Hazardous Materials; and all complaints, pleadings and other legal documents filed by or against Tenant related to Tenant’s storage, generation, use, release and/or disposal of Hazardous Materials; provided, however, that in no event shall Tenant be required to deliver any such information if delivery thereof would result in, or could give rise to the assertion that such delivery resulted in, the waiver of the attorney-client or other applicable legal privilege.

(d) Landlord and its agents shall have the right, but not the obligation, to inspect, sample and/or monitor the Premises and/or the soil or groundwater thereunder at any time to determine whether Tenant is complying with the terms of this Section 5.3, and in connection therewith Tenant shall provide Landlord with reasonable access to all facilities, records and personnel related thereto (subject to Landlord’s execution of a commercially reasonable nondisclosure agreement as may reasonably be required by Tenant with respect to any confidential information, and in any case such access shall be scheduled with Tenant in advance and shall be undertaken by Landlord so as not to interfere with Tenant’s operations in the Premises. In the event of a release of any Hazardous Material on, under, from or about the Premises caused or permitted by Tenant, its agents, employees, contractors, licensees, subtenants or invitees, Landlord and its agents shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to enter upon the Premises upon reasonable prior notice to Tenant (provided that no such notice shall be required in the case of an emergency that threatens immediate bodily injury or material property damage) and to discharge Tenant’s obligations under this Section 5.3 at Tenant’s expense, including without limitation the taking of emergency or long-term remedial action. Landlord and its agents shall endeavor to minimize interference with Tenant’s business in connection therewith, but shall not be liable for any such interference except to

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the extent arising as a consequence of the negligence or willful misconduct on the part of Landlord or the person or entity entering the Premises on behalf of Landlord. In addition, Landlord, at Tenant’s expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims arising out of the storage, generation, use, release and/or disposal by Tenant or its agents, employees, contractors, licensees, subtenants or invitees of Hazardous Materials on, under, from or about the Premises.

(e) If the presence of any Hazardous Materials on, under, from or about the Premises or the Project caused or permitted by Tenant or its agents, employees, contractors, licensees, subtenants or invitees results in (i) injury to any person, (ii) injury to or any contamination of the Premises or the Project, or (iii) injury to or contamination of any real or personal property wherever situated, Tenant, at its expense, shall promptly take all actions necessary to return the Premises and the Project and any other affected real or personal property owned by Landlord to the condition existing prior to the introduction of such Hazardous Materials (or, if the same is not reasonably practicable, to remediate the condition in question to a clean-up standard as may be required by the applicable law) and to remedy or repair any such injury or contamination, including without limitation, any cleanup, remediation, removal, disposal, neutralization or other treatment of any such Hazardous Materials. Notwithstanding the foregoing, except to the extent required by any governmental authority, Tenant shall not, without Landlord’s prior written consent, which consent may be given or withheld in Landlord’s sole and absolute discretion, take any remedial action in response to the presence of any Hazardous Materials on, under, from or about the Premises or the Project or any other affected real or personal property owned by Landlord or enter into any similar agreement, consent, decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials on, under, from or about the Premises or the Project or any other affected real or personal property owned by Landlord (i) imposes an immediate threat to the health, safety or welfare of any individual and (ii) is of such a nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action. To the fullest extent permitted by law, Tenant shall indemnify, hold harmless, protect and defend (with attorneys reasonably acceptable to Landlord) Landlord and any successors to all or any portion of Landlord’s interest in the Premises and the Project and any other real or personal property owned by Landlord from and against any and all liabilities, losses, damages, diminution in value, judgments, fines, demands, claims, recoveries, deficiencies, costs and expenses (including without limitation reasonable attorneys’ fees, court costs and other professional expenses), whether foreseeable or unforeseeable, arising directly or indirectly out of the use, generation, storage, treatment, release, on- or off-site disposal or transportation of Hazardous Materials on, into, from, under or about the Premises, the Building or the Project and any other real or personal property owned by Landlord to the extent caused or permitted by Tenant, its agents, employees, contractors, licensees, subtenants or invitees. Such indemnity obligation shall specifically include, without limitation, the cost of any required or necessary repair, restoration, cleanup or detoxification of the Premises, the Building and the Project and any other real or personal property owned by Landlord, the preparation of any closure or other required plans, whether such action is required or necessary during the Term or after the expiration of this Lease and any loss of rental due to the inability to lease the Premises or any portion of the Building or Project as a result of such Hazardous Materials, the remediation thereof or any repair, restoration or cleanup related thereto. If it is at any time discovered that Tenant or its agents, employees, contractors, licensees, subtenants or invitees may have caused or permitted the release of any Hazardous Materials on, under, from or about the Premises, the Building or the Project or any other real or personal property owned by Landlord, Tenant shall, at Landlord’s request, immediately prepare and submit to Landlord a comprehensive plan, subject to Landlord’s approval, specifying the actions to be taken by Tenant to return the Premises, the Building or the Project or any other real or personal property owned by Landlord to the condition existing prior to the introduction of such Hazardous Materials (to the extent reasonably practicable). Upon Landlord’s approval of such plan, Tenant shall, at its expense, and without limitation of any rights and remedies of Landlord under this Lease or at law or in equity, immediately implement such plan and proceed to cleanup, remediate and/or remove all such Hazardous Materials in accordance with all applicable laws and as required by such plan and this Lease. The provisions of this Section 5.3(e) shall expressly survive the expiration or sooner termination of this Lease.

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(f) Landlord hereby discloses to Tenant, and Tenant hereby acknowledges, certain facts relating to Hazardous Materials at the Project known by Landlord to exist as of the date of this Lease, as more particularly described in Exhibit H attached hereto. Tenant shall have no liability or responsibility with respect to the Hazardous Materials facts described in Exhibit H, nor with respect to any Hazardous Materials which were not caused or permitted by Tenant, its agents, employees, contractors, licensees, subtenants or invitees; and Landlord, as its sole cost and expense and not as a Project Cost, shall be responsible for the remediation of any such Hazardous Materials if and to the extent required by law. Notwithstanding the preceding two sentences, Tenant agrees to notify its agents, employees, contractors, licensees, subtenants, and invitees of any exposure or potential exposure to Hazardous Materials at the Premises that Landlord brings to Tenant’s attention. Tenant hereby acknowledges that this disclosure satisfies any obligation of Landlord to Tenant pursuant to California Health & Safety Code Section 25359.7, or any amendment or substitute thereto or any other disclosure obligations of Landlord.

ARTICLE 6. LANDLORD SERVICES

6.1 UTILITIES AND SERVICES. Landlord and Tenant shall be responsible to furnish those utilities and services to the Premises to the extent provided in Exhibit C and elsewhere in this Lease, subject to the conditions and payment obligations and standards set forth in this Lease. Landlord shall not be liable for any failure to furnish any services or utilities when the failure is the result of any accident or other cause beyond Landlord’s reasonable control, nor shall Landlord be liable for damages resulting from power surges or any breakdown in telecommunications facilities or services. Landlord’s temporary inability to furnish any services or utilities shall not entitle Tenant to any damages, relieve Tenant of the obligation to pay rent or constitute a constructive or other eviction of Tenant, except that Landlord shall diligently attempt to restore the service or utility promptly. Notwithstanding the foregoing to the contrary, if the Premises, or a material portion of the Premises, are made untenantable for a period in excess of 3 consecutive business days as a result of a service interruption that is reasonably within the control of Landlord to correct and through no fault of Tenant and for reasons other than as contemplated in Article 11, then Tenant, as its sole remedy, shall be entitled to receive an abatement of Rent payable hereunder during the period beginning on the 4^th consecutive business day of the service interruption and ending on the day the service has been restored. Tenant shall comply with all rules and regulations which Landlord may reasonably establish for the provision of services and utilities, and shall cooperate with all reasonable conservation practices established by Landlord. Landlord shall at all reasonable times have free access to all electrical and mechanical installations of Landlord. Subject to the terms of this Lease, Tenant shall have access to the Premises 24 hours a day, 7 days a week, 365 days a year.

6.2 OPERATION AND MAINTENANCE OF COMMON AREAS. During the Term, Landlord shall operate all Common Areas within the Building and the Project. The term “Common Areas” shall mean all areas within the Building and other buildings in the Project which are not held for exclusive use by persons entitled to occupy space, including without limitation parking areas and structures, driveways, sidewalks, landscaped and planted areas, hallways and interior stairwells not located within the premises of any tenant, common electrical rooms, entrances and lobbies, elevators, and restrooms not located within the premises of any tenant.

6.3 USE OF COMMON AREAS. The occupancy by Tenant of the Premises shall include the use of the Common Areas in common with Landlord and with all others for whose convenience and use the Common Areas may be provided by Landlord, subject, however, to compliance with Rules and Regulations described in Article 17 below. Landlord shall at all times during the Term have exclusive control of the Common Areas, and may restrain or permit any use or occupancy, except as otherwise provided in this Lease or in Landlord’s rules and regulations. Tenant shall keep the Common Areas clear of any obstruction or unauthorized use related to Tenant’s operations. Landlord may temporarily close any portion of the Common Areas for repairs, remodeling and/or alterations, to prevent a public dedication or the accrual of prescriptive rights, or for any other reasonable purpose. Landlord’s temporary closure of any portion of the Common Areas for such purposes shall not deprive Tenant of reasonable access to the Premises.

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6.4 CHANGES AND ADDITIONS BY LANDLORD. Landlord reserves the right to make alterations or additions to the Building or the Project or to the attendant fixtures, equipment and Common Areas, and such change shall not entitle Tenant to any abatement of rent or other claim against Landlord. No such change shall deprive Tenant of reasonable access to or use of the Premises.

ARTICLE 7. REPAIRS AND MAINTENANCE

7.1 TENANT’S MAINTENANCE AND REPAIR. Subject to Articles 11 and 12, Tenant at its sole expense shall make all repairs necessary to keep the Premises and all improvements and fixtures therein in good condition and repair, excepting ordinary wear and tear. Notwithstanding Section 7.2 below, Tenant’s maintenance obligation shall include without limitation all appliances, interior glass, doors, door closures, hardware, fixtures, electrical within the Premises, plumbing within the Premises, fire extinguisher equipment and other equipment installed in the Premises and all Alterations constructed by Tenant pursuant to Section 7.3 below, together with any supplemental HVAC equipment servicing only the data room and lab facilities in the Premises. All repairs and other work performed by Tenant or its contractors shall be subject to the terms of Sections 7.3 and 7.4 below. Alternatively, should Landlord or its management agent agree to make a repair on behalf of Tenant and at Tenants request, Tenant shall within 30 days reimburse Landlord as additional rent for all reasonable costs incurred including the standard supervision fee, not to exceed 5% following submission of a reasonably detailed invoice.

7.2 LANDLORD’S MAINTENANCE AND REPAIR. Subject to Articles 11 and 12, Landlord shall (i) provide service, maintenance and repair with respect to the heating, ventilating and air conditioning (“HVAC”) equipment of the Building (exclusive of any supplemental HVAC equipment servicing only the Premises) (ii) shall maintain in good condition and repair the Common Areas, roof, foundations, footings, the exterior surfaces of the exterior walls of the Building (including exterior glass), and the structural, electrical, mechanical and plumbing systems of the Building, except to the extent provided in Section 7.1 above, and (iii) maintain in a neat and clean condition and in good condition and repair the Common Areas of the Project. Landlord need not make any other improvements or repairs except as specifically required under this Lease, and nothing contained in this Section 7.2 shall limit Landlord’s right to reimbursement from Tenant for maintenance, repair costs and replacement costs as provided elsewhere in this Lease. Notwithstanding any provision of the California Civil Code or any similar or successor laws to the contrary, Tenant understands that it shall not make repairs at Landlord’s expense or by rental offset. Except as provided in Section 6.1, 11,1 and Article 12 below, there shall be no abatement of rent and no liability of Landlord by reason of any injury to or interference with Tenant’s business arising from the making of any repairs, alterations or improvements to any portion of the Building, including repairs to the Premises, nor shall any related activity by Landlord constitute an actual or constructive eviction; provided, however, that in making repairs, alterations or improvements, Landlord shall interfere as little as reasonably practicable with the conduct of Tenant’s business in the Premises. Tenant hereby waives any and all rights under and benefits of subsection 1 of Section 1932, and Sections 1941 and 1942 of the California Civil Code, or any similar or successor laws now or hereafter in effect.

7.3 ALTERATIONS. Except for cosmetic alterations and projects that do not exceed $50,000.00 during any calendar year of the Term, that do not require a permit from the City of Santa Clara and that satisfy the criteria in the next following sentence (which cosmetic work shall require notice to Landlord but not Landlord’s consent), Tenant shall make no alterations, additions, decorations, or improvements (collectively referred to as “Alterations”) to the Premises without the prior written consent of Landlord. Landlord’s consent shall not be unreasonably withheld as long as the proposed Alterations do not adversely affect the structural, electrical or mechanical components or systems of the Building and are not visible from the exterior of the Premises. Landlord may impose, as a condition to its consent, any requirements that Landlord in its reasonable discretion may deem appropriate. Without limiting the generality of the foregoing, Tenant shall use Landlord’s designated mechanical and electrical contractors for all Alterations work affecting the mechanical or electrical systems of the Building (so long as such contractors charge commercially competitive rates). Should Tenant perform any Alterations work that would necessitate any ancillary Building modification or other expenditure by Landlord, then Tenant shall promptly fund the cost thereof to Landlord. Tenant shall obtain all required permits for the Alterations and shall perform the work in compliance with all applicable laws, regulations and ordinances with contractors

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reasonably acceptable to Landlord, and except for cosmetic Alterations not requiring a permit, Landlord shall be entitled to a supervision fee in the amount of 5% of the cost of the Alterations. Any request for Landlord’s consent shall be made in writing and shall contain architectural plans describing the work in detail reasonably satisfactory to Landlord. Landlord may elect to cause its architect to review Tenant’s architectural plans, and the reasonable cost of that review shall be reimbursed by Tenant. Should the Alterations proposed by Tenant and consented to by Landlord change the floor plan of the Premises, then Tenant shall, at its expense, furnish Landlord with as-built drawings and CAD disks compatible with Landlord’s systems. Alterations shall be constructed in a good and workmanlike manner using materials of a quality reasonably approved by Landlord Unless Landlord otherwise agrees in writing, all Alterations affixed to the Premises, including without limitation all Tenant Improvements constructed pursuant to the Work Letter (except as otherwise provided in the Work Letter), but excluding moveable trade fixtures and furniture, shall become the property of Landlord and shall be surrendered with the Premises at the end of the Term, except that Landlord may, by notice to Tenant given at least 120 days prior to the Expiration Date, require Tenant to remove by the Expiration Date, or sooner termination date of this Lease, any Required Removables (defined herein) (including without limitation all telephone and data cabling): provided, however, that the initial Tenant Improvements installed pursuant to the Work Letter shall not be considered Required Removables and shall not be required to be removed by Tenant, Concurrently with Landlord’s approval of any Alteration, Landlord shall advise Tenant in writing as to which portions of the subject Alterations must be removed by Tenant at the end of the Term (the “Required Removables”). In connection with its removal of Required Removables, Tenant shall repair any damage to the Premises arising from that removal and shall restore the affected area to its pre-existing condition, reasonable wear and tear excepted.

Landlord shall not make alterations to the Building which would cause a material adverse impact on Tenant’s business and operations without the prior written consent of Tenant.

7.4 MECHANIC’S LIENS. Tenant shall keep the Premises free from any liens arising out of any work performed, materials furnished, or obligations incurred by or for Tenant. Upon request by Landlord. Tenant shall promptly cause any such lien to be released by posting a bond in accordance with California Civil Code Section 8424 or any successor statute. In the event that Tenant shall not, within 15 days following the imposition of any lien, cause the lien to be released of record by payment or posting of a proper bond, Landlord shall have, in addition to all other available remedies, the right to cause the lien to be released by any means it deems proper, including payment of or defense against the claim giving rise to the lien. All expenses so incurred by Landlord, including Landlord’s attorneys’ fees, shall be reimbursed by Tenant promptly following Landlord’s demand, together with interest from the date of payment by Landlord at the maximum rate permitted by law until paid. Tenant shall give Landlord no less than 20 days prior notice in writing before commencing construction of any kind on the Premises.

7.5 ENTRY AND INSPECTION. Landlord shall at all reasonable times have the right to enter the Premises to inspect them, to supply services in accordance with this Lease, to make repairs and renovations as reasonably deemed necessary by Landlord, and to submit the Premises to prospective or actual purchasers or encumbrance holders (or. during the final twelve months of the Term or when an uncured Default exists, to prospective tenants), all without being deemed to have caused an eviction of Tenant and without abatement of rent except as provided elsewhere in this Lease. If reasonably necessary, Landlord may temporarily close portions of the Premises to perform repairs, alterations and additions, provided that such closures shall be limited and, if necessary, undertaken in sequence and as may otherwise be required by Tenant so as to interfere as little as possible with Tenant’s operations in the Premises; and, if required by Tenant, shall be performed after regular business hours. Except in emergencies or to provide Building services, Landlord shall provide Tenant with at least 24 hours’ prior verbal notice of entry and shall use diligent efforts to minimize any interference with Tenant’s use of the Premises. Notwithstanding anything set forth to the contrary, any such entry by Landlord shall be subject to Tenant’s customary operating, safety and security requirements, and Tenant may restrict or prohibit entry into computer laboratories and other secure portions of the Premises (unless Landlord’s employee, if requested by Tenant, executes a commercially reasonable confidentiality agreement), and may require that an employee of Tenant be present or otherwise accompany Landlord during all or any portion of the period of any such entry.

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ARTICLE 8. [INTENTIONALLY DELETED]

ARTICLE 9. ASSIGNMENT AND SUBLETTING

9.1 RIGHTS OF PARTIES.

(a) Except as otherwise specifically provided in this Article 9, Tenant may not, either voluntarily or by operation of law, assign, sublet, encumber, or otherwise transfer all or any part of Tenant’s interest in this Lease, or permit the Premises to be occupied by anyone other than Tenant (each, a “Transfer”), without Landlord’s prior written consent, which consent shall not unreasonably be withheld, conditioned or delayed in accordance with the provisions of Section 9.1(b). For purposes of this Lease, references to any subletting, sublease or variation thereof shall be deemed to apply not only to a sublease effected directly by Tenant, but also to a sub-subletting or an assignment of subtenancy by a subtenant at any level. Except as otherwise specifically provided in this Article 9, no Transfer (whether voluntary, involuntary or by operation of law) shall be valid or effective without Landlord’s prior written consent and, at Landlord’s election, such a Transfer without Landlord’s consent (where required) shall constitute a material default of this Lease.

(b) Except as otherwise specifically provided in this Article 9, if Tenant or any subtenant hereunder desires to transfer an interest in this Lease, Tenant shall first notify Landlord in writing and shall request Landlord’s consent thereto. Tenant shall also submit to Landlord in writing: (i) the name and address of the proposed transferee; (ii) the nature of any proposed subtenant’s or assignee’s business to be carried on in the Premises; (iii) the terms and provisions of any proposed sublease or assignment (including without limitation the rent and other economic provisions, term, improvement obligations and commencement date), (iv) evidence that the proposed assignee or subtenant will comply with the requirements of Exhibit D to this Lease; and (v) any other information requested by Landlord and reasonably related to the Transfer. Landlord shall not unreasonably withhold its consent, provided: (1) the use of the Premises will be consistent with the provisions of this Lease and with Landlord’s commitment to other tenants of the Building and Project; (2) any proposed subtenant or assignee demonstrates that it is financially responsible by submission to Landlord of all reasonable information as Landlord may request concerning the proposed subtenant or assignee, including, but not limited to and to the extent available, a balance sheet of the proposed subtenant or assignee as of a date within 90 days of the request for Landlord’s consent and statements of income or profit and loss of the proposed subtenant or assignee for the two-year period preceding the request for Landlord’s consent; (3) the proposed assignee or subtenant is neither an existing tenant or occupant of the Building or Project nor a prospective tenant with whom Landlord or Landlord’s affiliate has been actively negotiating to become a tenant at the Building or Project; and (4) the proposed transferee is not an SDN (as defined below) and will not impose additional burdens or security risks on Landlord. If Landlord consents to the proposed Transfer, then the Transfer may be effected within 90 days after the date of the consent upon the terms described in the information furnished to Landlord; provided that any material change in the terms shall be subject to Landlord’s consent as set forth in this Section 9.1(b). Landlord shall approve or disapprove any requested Transfer within 20 days following receipt of Tenant’s written notice and the information set forth above. Except in connection with a Permitted Transfer (as defined below), if Landlord approves the Transfer Tenant shall pay a transfer fee of $1,000.00 to Landlord concurrently with Tenant’s execution of a Transfer consent prepared by Landlord.

(c) Notwithstanding anything to the contrary contained in this Article 9, in the event that Tenant contemplates an assignment of this Lease, or to a subletting of 75% or more of the Floor Area of the Premises for all or substantially all of the remainder of the Term of this Lease (“Contemplated Transfer”), then Tenant shall give Landlord notice (“Intention to Transfer Notice”) of such Contemplated Transfer. The Intention to Transfer Notice shall specify the portion and amount of rentable square feet of the Premises which Tenant intends to transfer (“Contemplated Transfer Space”), the contemplated date of the commencement of the Contemplated Transfer (“Contemplated Effective Date”) and shall state that it is an assignment or a sublease of the Contemplated Transfer Space for substantially all of the remainder of the Term of this Lease, and shall specify that such Intention to Transfer Notice is delivered to Landlord pursuant to this Section 9.1(c) in order to allow Landlord to elect to recapture the

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Contemplated Transfer Space. Thereafter, Landlord shall have the option, by giving written notice to Tenant within fifteen (15) business days after receipt of such Intention to Transfer Notice, to recapture such Contemplated Transfer Space upon the basic terms and conditions specified in the Intention to Transfer Notice. In the event Landlord does not give such written recapture notice to Tenant within such fifteen (15) business day period, Tenant shall have one hundred eighty (180) days thereafter within which to effect the transfer in accordance with the Intention to Transfer Notice and subject to compliance with the other provisions of this Lease. In the event Tenant does not complete the transfer within that one hundred eighty (180)-day period, Tenant shall be required to deliver a new Intention to Transfer Notice to Landlord and repeat the provisions of this Section. In the event the recapture option is exercised by Landlord, this Lease shall be canceled and terminated with respect to the Contemplated Transfer Space as of the Contemplated Effective Date. In the event of a recapture by Landlord, if this Lease shall be canceled with respect to less than the entire Premises, (i) the rent reserved herein shall be prorated on the basis of the number of rentable square feet retained by Tenant in proportion to the number of rentable square feet contained in the Premises, and this Lease as so amended shall continue thereafter in full force and effect, and upon the request of either party, the parties shall execute written confirmation of the same, and (ii) Landlord shall install, on a commercially reasonable basis, any corridor and/or demising wall, at Landlord’s expense, which is required as a result of the cancellation of the Lease with respect to less than the entire Premises.

(d) Should any Transfer occur, Tenant shall, except in connection with a Permitted Transfer, promptly pay or cause to be paid to Landlord, as additional rent, 50% of any amounts paid by the assignee or subtenant as rent for the Premises or applicable portion thereof, to the extent such amounts are in excess of the sum of the scheduled Basic Rent and Operating Expenses payable by Tenant hereunder (or, in the event of a subletting of only a portion of the Premises, the Basic Rent and Operating Expenses allocable to such portion), provided, however, that Tenant shall first be entitled to recoup from any such excess payments the reasonable out-of-pocket costs incurred by Tenant to effect the Transfer, including without limitation costs of improvement, moving and other allowances, lease buy-out payments, demising and improvement costs, attorney’s fees and brokerage commissions.

(e) The sale of all or substantially all of the assets of Tenant (other than bulk sales in the ordinary course of business), the merger or consolidation of Tenant or the sale of Tenant’s capital stock (in each case where there is a change in control of Tenant) or any other direct or indirect change of control of Tenant, including, without limitation, change of control of Tenant’s parent company or a merger by Tenant or its parent company (in each case where there is a change in control of Tenant or such parent of Tenant), shall be deemed a Transfer within the meaning and provisions of this Article. Notwithstanding the foregoing, Tenant may assign this Lease to a successor to Tenant by merger, consolidation or the purchase of substantially all of Tenant’s assets or stock, or assign this Lease or sublet all or a portion of the Premises to an Affiliate (defined below), without the consent of Landlord but subject to the provisions of Section 9.2, provided that all of the following conditions are satisfied (a “Permitted Transfer”): (i) Tenant gives Landlord written notice at least 10 business days before such Permitted Transfer (unless prohibited by law from providing such advance notice, in which case Tenant shall notify Landlord thereof promptly after the occurrence of such Permitted Transfer); and (ii) the successor entity resulting from any merger or consolidation of Tenant or the sale of all or substantially all of the assets of Tenant, has a net worth at the time of the Permitted Transfer that is at least equal to the net worth of Tenant immediately before the Permitted Transfer, where net worth is computed in accordance with generally accepted accounting principles, except that intangible assets such as goodwill, patents, copyrights, and trademarks shall be excluded in the calculation. Tenant’s notice to Landlord shall include reasonable information and documentation evidencing the Permitted Transfer and showing that each of the above conditions has been satisfied. If requested by Landlord. Tenant’s successor shall sign and deliver to Landlord a commercially reasonable form of assumption agreement. “Affiliate” shall mean an entity controlled by, controlling or under common control with Tenant. Notwithstanding anything to the contrary in this Section 9, a public offering or private sale of Tenant’s securities shall be deemed a Permitted Transfer.

9.2 EFFECT OF TRANSFER. No subletting or assignment, even with the consent of Landlord, shall relieve Tenant, or any successor-in-interest to Tenant hereunder, of its obligation to pay rent and to

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perform all its other obligations under this Lease. Each assignee, shall be deemed to assume all obligations of Tenant under this Lease and shall be liable jointly and severally with Tenant for the payment of all rent, and for the due performance of all of Tenant’s obligations, under this Lease. Such joint and several liability shall not be discharged or impaired by any subsequent modification or extension of this Lease. Consent by Landlord to one or more transfers shall not operate as a waiver or estoppel to the future enforcement by Landlord of its rights under this Lease.

9.3 SUBLEASE REQUIREMENTS. Any sublease, license, concession or other occupancy agreement entered into by Tenant shall be subordinate and subject to the provisions of this Lease, and if this Lease is terminated during the term of any such agreement, Landlord shall have the right to: (i) treat such agreement as cancelled and repossess the subject space by any lawful means, or (ii) require that such transferee attorn to and recognize landlord as its landlord (or licensor, as applicable) under such agreement. Landlord shall not, by reason of such attornment or the collection of sublease rentals, be deemed liable to the subtenant for the performance of any of Tenant’s obligations under the sublease. If Tenant is in Default (hereinafter defined), Landlord is irrevocably authorized to direct any transferee under any such agreement to make all payments under such agreement directly to Landlord (which Landlord shall apply towards Tenant’s obligations under this Lease) until such Default is cured. No collection or acceptance of rent by Landlord from any transferee shall be deemed a waiver of any provision of Article 9 of this Lease, an approval of any transferee, or a release of Tenant from any obligation under this Lease, whenever accruing. In no event shall Landlord’s enforcement of any provision of this Lease against any transferee be deemed a waiver of Landlord’s right to enforce any term of this Lease against Tenant or any other person.

ARTICLE 10. INSURANCE AND INDEMNITY

10.1 TENANT’S INSURANCE. Tenant, at its sole cost and expense, shall provide and maintain in effect the insurance described in Exhibit D. Evidence of that insurance must be delivered to Landlord prior to the Commencement Date.

10.2 LANDLORD’S INSURANCE. Landlord shall provide and maintain “All Risk” or “Special Form” insurance, subject to standard exclusions (such as, but not limited to, earthquake and flood exclusions) covering the Building and the Project, in the amount of the extended full replacement cost thereof, and commercial general liability insurance, in each case subject to deductibles and additional coverages as may be determined by Landlord in its reasonable discretion, In addition, Landlord may, at its election, obtain insurance coverages for such other risks as Landlord or its Mortgagees may from time to time deem appropriate, including earthquake and terrorism coverage. Landlord shall not be required to carry insurance of any kind on any tenant improvements or Alterations in the Premises installed by Tenant or its contractors or otherwise removable by Tenant (collectively, “Tenant Installations”), or on any trade fixtures, furnishings, equipment, interior plate glass, signs or items of personal property in the Premises, and Landlord shall not be obligated to repair or replace any of the foregoing items should damage occur. All proceeds of insurance maintained by Landlord upon the Building and Project shall be the property of Landlord, whether or not Landlord is obligated to or elects to make any repairs.

10.3 TENANT’S INDEMNITY. To the fullest extent permitted by law, but subject to Section 10.5 below, Tenant shall defend, indemnify and hold harmless Landlord and Landlord’s agents, employees, lenders, and affiliates, from and against any and all third party claims, liabilities, damages, costs or expenses arising either before or after the Commencement Date to the extent arising as a consequence of Tenant’s use or occupancy of the Premises, the Building or the Common Areas of the Project, or from the conduct of Tenant’s business, or from any activity, work, or thing done, permitted or suffered by Tenant or Tenant’s agents, employees, subtenants, vendors, contractors, invitees or licensees in or about the Premises, the Building or the Common Areas of the Project, or from any Default in the performance of any obligation on Tenant’s part to be performed under this Lease, or from any act, omission or negligence on the part of Tenant or Tenant’s agents, employees, subtenants, vendors, contractors, invitees or licensees. Landlord may, at its option, require Tenant to assume Landlord’s defense in any action covered by this Section 10.3 through counsel reasonably satisfactory to Landlord. Notwithstanding the foregoing, Tenant shall not be obligated to indemnify Landlord against any liability or expense to the extent the same was caused by the negligence or willful misconduct of Landlord, its agents, contractors or employees or covered by Landlord’s indemnity obligations set forth in Section 10.4 below.

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10.4 LANDLORD INDEMNITY. To the fullest extent permitted by law, but subject to Section 10.6 below, Landlord shall defend, indemnify and hold harmless Tenant, its agents, lenders, and any and all affiliates of Tenant, from and against any and all third party claims, liabilities, costs or expenses arising either before or after the Commencement Date to the extent arising as a consequence of the negligence of willful misconduct of Landlord, its employees, agents or contractors, in connection with the operation, maintenance or repair of the Common Areas or other portions of the Project or any failure of Landlord to perform any obligation on Landlord’s part to be performed under this Lease. Tenant may, at its option, require Landlord to assume Tenant’s defense in any action covered by this Section 10.4 through counsel reasonably satisfactory to Tenant. Notwithstanding the foregoing, Landlord shall not be obligated to indemnify Tenant against any liability or expense to the extent the same was caused by the negligence of willful misconduct of Tenant, its agents, contractors or employees, or covered by Tenant’s indemnity obligations set forth in Section 10.3 above.

10.5 LANDLORD’S NONLIABILITY. Unless caused by the negligence or intentional misconduct of Landlord, its agents, employees or contractors but subject to Section 10.6 below, Landlord shall not be liable to Tenant, its employees, agents and invitees, and Tenant hereby waives all claims against Landlord, its employees and agents for loss of or damage to any property, or any injury to any person, resulting from any condition including, but not limited to, acts or omissions (criminal or otherwise) of third parties and/or other tenants of the Project, or their agents, employees or invitees, fire, explosion, falling plaster, steam, gas, electricity, water or rain which may leak or flow from or into any part of the Premises or from the breakage, leakage, obstruction or other defects of the pipes, sprinklers, wires, appliances, plumbing, air conditioning, electrical works or other fixtures in the Building, whether the damage or injury results from conditions arising in the Premises or in other portions of the Building. It is understood that any such condition may require the temporary evacuation or closure of all or a portion of the Building. Should Tenant elect to receive any service from a concessionaire, licensee or third party tenant of Landlord, Tenant shall not seek recourse against Landlord for any breach or liability of that service provider. Notwithstanding anything to the contrary contained in this Lease, in no event shall Landlord be liable for Tenant’s loss or interruption of business or income (including without limitation, Tenant’s consequential damages, lost profits or opportunity costs), or for interference with light or other similar intangible interests. Similarly, Tenant shall not be liable to Landlord for loss or interruption of business or income (including without limitation, Landlord’s consequential damages, lost profits or opportunity costs), excepting only damages arising in connection with Sections 5.3 and 15.1 of this Lease.

10.6 WAIVER OF SUBROGATION. Landlord and Tenant each hereby waives all rights of recovery against the other on account of loss and damage occasioned to the property of such waiving party to the extent that the waiving party is entitled to proceeds for such loss and damage under any property insurance policies carried or otherwise required to be carried by this Lease; provided however, that the foregoing waiver shall not apply to the extent of Tenant’s obligation to pay deductibles under any such policies and this Lease. By this waiver it is the intent of the parties that neither Landlord nor Tenant shall be liable to any insurance company (by way of subrogation or otherwise) insuring the other party for any loss or damage insured against under any property insurance policies, even though such loss or damage might be occasioned by the negligence of such party, its agents, employees, contractors or invitees. The foregoing waiver by Tenant shall also inure to the benefit of Landlord’s management agent for the Building.

ARTICLE 11. DAMAGE OR DESTRUCTION

11.1 RESTORATION.

(a) If the Building of which the Premises are a part is damaged as the result of an event of casualty, then subject to the provisions below, Landlord shall repair that damage as soon as reasonably possible unless Landlord reasonably determines that: (i) the Premises have been materially damaged and there is less than 1 year of the Term remaining on the date of the casualty; (ii) any Mortgagee

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(defined in Section 13.1) requires that the insurance proceeds be applied to the payment of the mortgage debt; or (iii) so long as Landlord maintained the insurance required hereunder, proceeds necessary to pay the full cost of the repair (exclusive of deductible or retention amounts) are not available from Landlord’s insurance, including without limitation earthquake insurance. Should Landlord elect not to repair the damage for one of the preceding reasons, Landlord shall so notify Tenant in the “Casualty Notice” (as defined below), and this Lease shall terminate as of the date of delivery of that notice.

(b) As soon as reasonably practicable following the casualty event but not later than 60 days thereafter, Landlord shall notify Tenant in writing (“Casualty Notice”) of Landlord’s election, if applicable, to terminate this Lease. If this Lease is not so terminated, the Casualty Notice shall set forth the anticipated period for repairing the casualty damage. If the anticipated repair period exceeds 270 days and if the damage is so extensive as to reasonably prevent Tenant’s substantial use and enjoyment of any material portion of the Premises, then either party may elect to terminate this Lease by written notice to the other within 20 days following delivery of the Casualty Notice. In addition, Tenant shall have the right to terminate this Lease if: (a) a substantial portion of the Premises has been damaged by casualty; (b) there is less than 1 year of the Term remaining on the date of the casualty; and (c) Tenant provides Landlord with written notice of its intent to terminate within 20 business days after the date of the casualty.

(c) In the event that neither Landlord nor Tenant terminates this Lease pursuant to Section 11.1(b), Landlord shall repair the damage to the Premises and the Building as soon as reasonably possible and this Lease shall continue in effect for the remainder of the Term. Landlord shall not be required to repair any Tenant Installations, fixtures and other items that Tenant is obligated to insure pursuant to Exhibit D or under any other provision of this Lease; provided, however, that if Landlord elects to undertake such repairs, then upon notice from Landlord, Tenant shall assign or endorse over to Landlord (or to any party designated by Landlord) all property insurance proceeds payable to Tenant under Tenant’s insurance with respect to any Tenant Installations; and provided further that if the estimated cost to repair such Tenant Installations exceeds the amount of insurance proceeds received by Landlord from Tenant’s insurance carrier, the excess cost of such repairs shall be paid by Tenant to Landlord prior to Landlord’s commencement of repairs. Within 30 days of demand, Tenant shall also pay Landlord for any additional excess costs that are determined during the performance of the repairs to such Tenant Installations.

(d) From and after the occurrence of the casualty event, the rental to be paid under this Lease shall be abated in the same proportion that the Floor Area of the Premises that is rendered unusable by the damage from time to time bears to the total Floor Area of the Premises.

11.2 LEASE GOVERNS. Tenant agrees that the provisions of this Lease, including without limitation Section 11.1, shall govern any damage or destruction and shall accordingly supersede any contrary statute or rule of law.

ARTICLE 12. EMINENT DOMAIN

Either party may terminate this Lease if any material part of the Premises is taken or condemned for any public or quasi-public use under Law, by eminent domain or private purchase in lieu thereof (a “Taking”). The termination shall be effective as of the effective date of any order granting possession to, or vesting legal title in, the condemning authority. If this Lease is not terminated, Basic Rent and Tenant’s Share of Operating Expenses shall be appropriately adjusted to account for any reduction in the square footage of the Building or Premises. All compensation awarded for a Taking shall be the property of Landlord and the right to receive compensation or proceeds in connection with a Taking are expressly waived by Tenant; provided, however, Tenant may file a separate claim for Tenant’s personal property and Tenant’s reasonable relocation expenses, provided the filing of the claim does not diminish the amount of Landlord’s award. If only a part of the Premises is subject to a Taking and this Lease is not terminated, Landlord, with reasonable diligence, will restore the remaining portion of the Premises as nearly as practicable to the condition immediately prior to the Taking. Tenant agrees that the provisions of this Lease shall govern any Taking and shall accordingly supersede any contrary statute or rule of law.

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ARTICLE 13. SUBORDINATION; ESTOPPEL CERTIFICATE

13.1 SUBORDINATION. Tenant accepts this Lease subject and subordinate to any mortgage(s), deed(s) of trust, ground lease(s) or other lien(s) now or subsequently arising upon the Premises, the Building or the Project, and to renewals, modifications, refinancings and extensions thereof (collectively referred to as a “Mortgage”). The party having the benefit of a Mortgage shall be referred to as a “Mortgagee”. This clause shall be self-operative, but upon request from a Mortgagee, Tenant shall execute a commercially reasonable subordination and attornment agreement in favor of the Mortgagee, provided such agreement provides a non-disturbance covenant benefiting Tenant. Alternatively, a Mortgagee shall have the right at any time to subordinate its Mortgage to this Lease. Tenant shall attorn to any successor to Landlord’s interest in this Lease in the event of a foreclosure of any mortgage and such successor shall recognize Tenant and shall be bound by the terms of this Lease. Tenant agrees that any purchaser at a foreclosure sale or lender taking title under a deed in lieu of foreclosure shall not be responsible for any act or omission of a prior landlord, shall not be subject to any offsets or defenses Tenant may have against a prior landlord, and shall not be liable for the return of the Security Deposit not actually recovered by such purchaser nor bound by any rent paid in advance of the calendar month in which the transfer of title occurred; provided that the foregoing shall not release the applicable prior landlord from any liability for those obligations. Tenant acknowledges that Landlord’s Mortgagees and their successors-in-interest are intended third party beneficiaries of this Section 13.1.

Notwithstanding the foregoing in this Section to the contrary, as a condition precedent to the future subordination of this Lease to a future Mortgage, Landlord shall be required to provide Tenant with a non-disturbance, subordination, and attornment agreement in favor of Tenant from any Mortgagee who comes into existence after the Commencement Date. Such non-disturbance, subordination, and attornment agreement in favor of Tenant shall provide that, so long as Tenant is paying the Rent due under the Lease and is not otherwise in default under the Lease beyond any applicable cure period, its right to possession and the other terms of the Lease shall remain in full force and effect. Such non-disturbance, subordination, and attornment agreement may include other commercially reasonable provisions in favor of the Mortgagee, including, without limitation, additional time on behalf of the Mortgagee to cure defaults of the Landlord and provide that (a) neither Mortgagee nor any successor-in-interest shall be bound by any payment of the Rent, or other sum due under this Lease for more than 1 month in advance or (ii) any amendment or modification of the Lease made without the express written consent of Mortgagee or any successor-in-interest; (b) neither Mortgagee nor any successor-in-interest will be liable for (i) any act or omission or warranties of any prior landlord (including Landlord), (ii) the breach of any warranties or obligations relating to construction of improvements on the Building or any tenant finish work performed or to have been performed by any prior landlord (including Landlord), or (iii) the return of any Security Deposit, except to the extent such deposits have been received by Mortgagee; and (c) neither Mortgagee nor any successor-in-interest shall be subject to any offsets or defenses which Tenant might have against any prior landlord (including Landlord).

Landlord warrants to Tenant that there are no Mortgages encumbering the Building as of the execution of this Lease.

13.2 ESTOPPEL CERTIFICATE. Tenant shall, within 10 business days after receipt of a written request from Landlord, execute and deliver a commercially reasonable estoppel certificate in favor of those parties as are reasonably requested by Landlord (including a Mortgagee or a prospective purchaser of the Building or the Project).

ARTICLE 14. DEFAULTS AND REMEDIES

14.1 TENANT’S DEFAULTS. In addition to any other event of default set forth in this Lease, the occurrence of any one or more of the following events shall constitute a “Default” by Tenant:

(a) The failure by Tenant to make any payment of Rent required to be made by Tenant, as and when due, where the failure continues for a period of 5 days after written notice from Landlord to Tenant. The term “Rent” as used in this Lease shall be deemed to mean the Basic Rent and all other sums required to be paid by Tenant to Landlord pursuant to the terms of this Lease.

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(b) The assignment, sublease, encumbrance or other Transfer of the Lease by Tenant, either voluntarily or by operation of law, whether by judgment, execution, transfer by intestacy or testacy, or other means, without the prior written consent of Landlord unless otherwise authorized or permitted in Article 9 of this Lease.

(c) The discovery by Landlord that any financial statement provided by Tenant, or by any affiliate, successor or guarantor of Tenant, was materially false.

(d) Except where a specific time period is otherwise set forth for Tenant’s performance in this Lease (in which event the failure to perform by Tenant within such time period shall be a Default), the failure or inability by Tenant to observe or perform any of the covenants or provisions of this Lease to be observed or performed by Tenant, other than as specified in any other subsection of this Section 14.1, where the failure continues for a period of 30 days after written notice from Landlord to Tenant. However, if the nature of the failure is such that more than 30 days are reasonably required for its cure, then Tenant shall not be deemed to be in Default if Tenant commences the cure within 30 days, and thereafter diligently pursues the cure to completion.

The notice periods provided herein are in lieu of, and not in addition to, any notice periods provided by law, and Landlord shall not be required to give any additional notice under California Code of Civil Procedure Section 1161, or any successor statute, in order to be entitled to commence an unlawful detainer proceeding.

14.2 LANDLORD’S REMEDIES.

(a) Upon the occurrence of any Default by Tenant, then in addition to any other remedies available to Landlord, Landlord may exercise the following remedies:

(i) Landlord may terminate Tenant’s right to possession of the Premises by any lawful means, in which case this Lease shall terminate and Tenant shall immediately surrender possession of the Premises to Landlord. Such termination shall not affect any accrued obligations of Tenant under this Lease. Upon termination, Landlord shall have the right to reenter the Premises and remove all persons and property. Landlord shall also be entitled to recover from Tenant:

(1) The worth at the time of award of the unpaid Rent which had been earned at the time of termination;

(2) The worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such loss that Tenant proves could have been reasonably avoided;

(3) The worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such loss that Tenant proves could be reasonably avoided;

(4) Any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which in the ordinary course of things would be likely to result from Tenant’s default, including, but not limited to, the cost of recovering possession of the Premises, commissions and other expenses of reletting, including necessary repair, renovation, improvement and alteration of the Premises for a new tenant, reasonable attorneys fees, and any other reasonable costs; and

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(5) At Landlord’s election, all other amounts in addition to or in lieu of the foregoing as may be permitted by law. Any sum, other than Basic Rent, shall be computed on the basis of the average monthly amount accruing during the 24 month period immediately prior to Default, except that if it becomes necessary to compute such rental before the 24 month period has occurred, then the computation shall be on the basis of the average monthly amount during the shorter period. As used in subparagraphs (1) and (2) above, the “worth at the time of award” shall be computed by allowing interest at the rate of 10% per annum. As used in subparagraph (3) above, the “worth at the time of award” shall be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus 1%.

(ii) Landlord may elect not to terminate Tenant’s right to possession of the Premises, in which event Landlord may continue to enforce all of its rights and remedies under this Lease, including the right to collect all rent as it becomes due. Efforts by the Landlord to maintain, preserve or relet the Premises, or the appointment of a receiver to protect the Landlord’s interests under this Lease, shall not constitute a termination of the Tenant’s right to possession of the Premises. In the event that Landlord elects to avail itself of the remedy provided by this subsection (ii), Landlord shall not unreasonably withhold its consent to an assignment or subletting of the Premises subject to the reasonable standards for Landlord’s consent as are contained in this Lease.

(b) The various rights and remedies reserved to Landlord in this Lease or otherwise shall be cumulative and, except as otherwise provided by California law. Landlord may pursue any or all of its rights and remedies at the same time. No delay or omission of Landlord to exercise any right or remedy shall be construed as a waiver of the right or remedy or of any breach or Default by Tenant. The acceptance by Landlord of rent shall not be a (i) waiver of any preceding breach or Default by Tenant of any provision of this Lease, other than the failure of Tenant to pay the particular rent accepted, regardless of Landlord’s knowledge of the preceding breach or Default at the time of acceptance of rent, or (ii) a waiver of Landlord’s right to exercise any remedy available to Landlord by virtue of the breach or Default, The acceptance of any payment from a debtor in possession, a trustee, a receiver or any other person acting on behalf of Tenant or Tenant’s estate shall not waive or cure a Default under Section 14.1. No payment by Tenant or receipt by Landlord of a lesser amount than the rent required by this Lease shall be deemed to be other than a partial payment on account of the earliest due stipulated rent, nor shall any endorsement or statement on any check or letter be deemed an accord and satisfaction and Landlord shall accept the check or payment without prejudice to Landlord’s right to recover the balance of the rent or pursue any other remedy available to it. Tenant hereby waives any right of redemption or relief from forfeiture under California Code of Civil Procedure Section 1174 or 1179, or under any successor statute, in the event this Lease is terminated by reason of any Default by Tenant. No act or thing done by Landlord or Landlord’s agents during the Term shall be deemed an acceptance of a surrender of the Premises, and no agreement to accept a surrender shall be valid unless in writing and signed by Landlord. No employee of Landlord or of Landlord’s agents shall have any power to accept the keys to the Premises prior to the termination of this Lease, and the delivery of the keys to any employee shall not operate as a termination of the Lease or a surrender of the Premises.

14.3 LATE PAYMENTS. Any Rent due under this Lease that is not paid to Landlord within 5 days of the date when due shall bear interest at the maximum rate permitted by law from the date due until fully paid. The payment of interest shall not cure any Default by Tenant under this Lease. In addition, Tenant acknowledges that the late payment by Tenant to Landlord of rent will cause Landlord to incur costs not contemplated by this Lease, the exact amount of which will be extremely difficult and impracticable to ascertain. Those costs may include, but are not limited to, administrative, processing and accounting charges, and late charges which may be imposed on Landlord by the terms of any ground lease, mortgage or trust deed covering the Premises. Accordingly, if any rent due from Tenant shall not be received by Landlord or Landlord’s designee within 5 days after the date due, then Tenant shall pay to Landlord, in addition to the interest provided above, a late charge for each delinquent payment equal to the greater of (i) 5% of that delinquent payment or (ii) $100.00. Acceptance of a late charge by Landlord shall not constitute a waiver of Tenant’s Default with respect to the overdue amount, nor shall it prevent Landlord from exercising any of its other rights and remedies.

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14.4 RIGHT OF LANDLORD TO PERFORM. If Tenant is in Default of any of its obligations under the Lease, Landlord shall have the right to perform such obligations. Tenant shall reimburse Landlord for the cost of such performance upon demand together with an administrative charge equal to 10% of the cost of the work performed by Landlord.

14.5 DEFAULT BY LANDLORD. Landlord shall not be deemed to be in default in the performance of any obligation under this Lease unless and until it has failed to perform the obligation within 30 days after written notice by Tenant to Landlord specifying in reasonable detail the nature and extent of the failure; provided, however, that if the nature of Landlord’s obligation is such that more than 30 days are required for its performance, then Landlord shall not be deemed to be in default if it commences performance within the 30 day period and thereafter diligently pursues the cure to completion. Tenant hereby waives any right to terminate or rescind this Lease as a result of any default by Landlord hereunder or any breach by Landlord of any promise or inducement relating hereto, and Tenant agrees that its remedies shall be limited to a suit for actual damages and/or injunction and shall in no event include any consequential damages, lost profits or opportunity costs.

14.6 EXPENSES AND LEGAL FEES. Should either Landlord or Tenant bring any action in connection with this Lease, the prevailing party shall be entitled to recover as a part of the action its reasonable attorneys’ fees, and all other reasonable costs. The prevailing party for the purpose of this paragraph shall be determined by the trier of the facts.

14.7 WAIVER OF JURY TRIAL/JUDICIAL REFERENCE.

(a) LANDLORD AND TENANT EACH ACKNOWLEDGES THAT IT IS AWARE OF AND HAS HAD THE ADVICE OF COUNSEL OF ITS CHOICE WITH RESPECT TO ITS RIGHT TO TRIAL BY JURY, AND EACH PARTY DOES HEREBY EXPRESSLY AND KNOWINGLY WAIVE AND RELEASE ALL SUCH RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER PARTY HERETO AGAINST THE OTHER (AND/OR AGAINST ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, OR SUBSIDIARY OR AFFILIATED ENTITIES) ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE, TENANT’S USE OR OCCUPANCY OF THE PREMISES, AND/OR ANY CLAIM OF INJURY OR DAMAGE.

(b) In the event that the jury waiver provisions of Section 14.7 (a) are not enforceable under California law, then, unless otherwise agreed to by the parties, the provisions of this Section 14.7 (b) shall apply. Landlord and Tenant agree that any disputes arising in connection with this Lease (including but not limited to a determination of any and all of the issues in such dispute, whether of fact or of law) shall be resolved (and a decision shall be rendered) by way of a general reference as provided for in Part 2, Title 8, Chapter 6 (§§ 638 et. seq.) of the California Code of Civil Procedure, or any successor California statute governing resolution of disputes by a court appointed referee. Nothing within this Section 14.7 shall apply to an unlawful detainer action.

14.8 SATISFACTION OF JUDGMENT. The obligations of Landlord do not constitute the personal obligations of the individual partners, trustees, directors, officers, members or shareholders of Landlord or its constituent partners or members. Should Tenant recover a money judgment against Landlord, such judgment shall be satisfied only from the interest of Landlord in the Project and out of the rent or other income from such property receivable by Landlord, and no action for any deficiency may be sought or obtained by Tenant.

ARTICLE 15. END OF TERM

15.1 HOLDING OVER. If Tenant holds over for any period after the Expiration Date (or earlier termination of the Term) without the prior written consent of Landlord, such tenancy shall constitute a tenancy at sufferance only and a Default by Tenant, such holding over with the prior written consent of Landlord shall constitute a month-to-month tenancy commencing on the 1$` day following the termination of this Lease and terminating 30 days following delivery of written notice of termination by either Landlord

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or Tenant to the other. In either of such events, possession shall be subject to all of the terms of this Lease except that (i) for the first two (2) months of such holdover, the monthly Basic Rent shall continue to be the monthly Basic Rent in effect for the month immediately preceding the date of termination, and (ii) thereafter, the monthly rent shall be 150% of the monthly Basic Rent for the month immediately preceding the date of termination, subject to the right of either party to terminate any such month-to-month holdover tenancy by giving 30 days prior written notice to the other party. The acceptance by Landlord of monthly hold-over rental in a lesser amount shall not constitute a waiver of Landlord’s right to recover the full amount due unless otherwise agreed in writing by Landlord. If Tenant fails to surrender the Premises upon the expiration of this Lease despite demand to do so by Landlord, Tenant shall indemnify and hold Landlord harmless from all loss or liability, including without limitation, any claims made by any succeeding tenant relating to such failure to surrender. The foregoing provisions of this Section 15.1 are in addition to and do not affect Landlord’s right of re-entry or any other rights of Landlord under this Lease or at law.

15.2 SURRENDER OF PREMISES; REMOVAL OF PROPERTY. Upon the Expiration Date or upon any earlier termination of this Lease, Tenant shall quit and surrender possession of the Premises to Landlord in as good order, condition and repair as when received or as hereafter may be improved by Landlord or Tenant, reasonable wear and tear and repairs which are Landlord’s obligation excepted, and shall remove all wallpapering, voice and/or data transmission cabling installed by or for Tenant and Required Removables, together with all personal property and debris, and shall perform all work required under Section 7.3 of this Lease. If Tenant shall fail to comply with the provisions of this Section 15.2, Landlord may effect the removal and/or make any repairs, and the cost to Landlord shall be additional rent payable by Tenant upon demand.

ARTICLE 16. PAYMENTS AND NOTICES

All sums payable by Tenant to Landlord shall be paid, without deduction or offset (except as otherwise expressly provided herein), in lawful money of the United States to Landlord at its address set forth in Item 12 of the Basic Lease Provisions, or at any other place as Landlord may designate in writing. Unless this Lease expressly provides otherwise, as for example in the payment of rent pursuant to Section 4.1, all payments shall be due and payable within 5 days after demand. All payments requiring proration shall be prorated on the basis of the number of days in the pertinent calendar month or year. as applicable. Any notice, election, demand, consent, approval or other communication to be given or other document to be delivered by either party to the other may be delivered to the other party, at the address set forth in Item 12 of the Basic Lease Provisions, by personal service, or by any courier or “overnight” express mailing service. Either party may, by written notice to the other, served in the manner provided in this Article, designate a different address. The refusal to accept delivery of a notice, or the inability to deliver the notice (whether due to a change of address for which notice was not duly given or other good reason), shall be deemed delivery and receipt of the notice as of the date of attempted delivery, If more than one person or entity is named as Tenant under this Lease, service of any notice upon any one of them shall be deemed as service upon all of them.

ARTICLE 17. RULES AND REGULATIONS

Tenant agrees to comply with the Rules and Regulations attached as Exhibit E, and any reasonable and nondiscriminatory amendments, modifications and/or additions as may be adopted and published by written notice to tenants by Landlord for the safety, care, security, good order, or cleanliness of the Premises, Building, Project and/or Common Areas. Landlord shall not be liable to Tenant for any violation of the Rules and Regulations or the breach of any covenant or condition in any lease or any other act or conduct by any other tenant, and the same shall not constitute a constructive eviction hereunder. One or more waivers by Landlord of any breach of the Rules and Regulations by Tenant or by any other tenant(s) shall not be a waiver of any subsequent breach of that rule or any other. In the case of any conflict between the Rules and Regulations and this Lease, this Lease shall be controlling.

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ARTICLE 18. BROKER’S COMMISSION

The parties recognize as the broker(s) who negotiated this Lease the firm(s) whose name(s) is (are) stated in Item 10 of the Basic Lease Provisions, and agree that Landlord shall be responsible for the payment of brokerage commissions to those broker(s) unless otherwise provided in this Lease. It is understood that Landlord’s Broker represents only Landlord in this transaction and Tenant’s Broker (if any) represents only Tenant. Each party warrants that it has had no dealings with any other real estate broker or agent in connection with the negotiation of this Lease, and agrees to indemnify and hold the other party harmless from any cost, expense or liability (including reasonable attorneys’ fees) for any compensation, commissions or charges claimed by any other real estate broker or agent employed or claiming to represent or to have been employed by the indemnifying party in connection with the negotiation of this Lease. The foregoing agreement shall survive the termination of this Lease.

ARTICLE 19. TRANSFER OF LANDLORD’S INTEREST

In the event of any transfer of Landlord’s interest in the Premises, the transferor shall be automatically relieved of all obligations on the part of Landlord accruing under this Lease from and after the date of the transfer, provided that Tenant is duly notified of the transfer. Any funds held by the transferor in which Tenant has an interest, including without limitation, the Security Deposit, shall be turned over, subject to that interest, to the transferee. No Mortgagee to which this Lease is or may be subordinate shall be responsible in connection with the Security Deposit unless the Mortgagee actually receives the Security Deposit. It is intended that the covenants and obligations contained in this Lease on the part of Landlord shall, subject to the foregoing, be binding on Landlord, its successors and assigns, only during and in respect to their respective successive periods of ownership.

ARTICLE 20. INTERPRETATION

20.1 NUMBER. Whenever the context of this Lease requires, the words “Landlord” and “Tenant” shall include the plural as well as the singular.

20.2 HEADINGS. The captions and headings of the articles and sections of this Lease are for convenience only, are not a part of this Lease and shall have no effect upon its construction or interpretation.

20.3 JOINT AND SEVERAL LIABILITY. If more than one person or entity is named as Tenant, the obligations imposed upon each shall be joint and several and the act of or notice from, or notice or refund to, or the signature of, any one or more of them shall be binding on all of them with respect to the tenancy of this Lease, including, but not limited to, any renewal, extension, termination or modification of this Lease.

20.4 SUCCESSORS. Subject to Sections 13.1 and 22.3 and to Articles 9 and 19 of this Lease, all rights and liabilities given to or imposed upon Landlord and Tenant shall extend to and bind their respective heirs, executors, administrators, successors and assigns. Nothing contained in this Section 20.4 is intended, or shall be construed, to grant to any person other than Landlord and Tenant and their successors and assigns any rights or remedies under this Lease.

20.5 TIME OF ESSENCE. Time is of the essence with respect to the performance of every provision of this Lease in which time of performance is a factor.

20.6 CONTROLLING LAW/VENUE. This Lease shall be governed by and interpreted in accordance with the laws of the State of California. Should any litigation be commenced between the parties in connection with this Lease, such action shall be prosecuted in the applicable State Court of California in the county in which the Building is located.

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20.7 SEVERABILITY. If any term or provision of this Lease, the deletion of which would not adversely affect the receipt of any material benefit by either party or the deletion of which is consented to by the party adversely affected, shall be held invalid or unenforceable to any extent, the remainder of this Lease shall not be affected and each term and provision of this Lease shall be valid and enforceable to the fullest extent permitted by law.

20.8 WAIVER. One or more waivers by Landlord or Tenant of any breach of any term, covenant or condition contained in this Lease shall not be a waiver of any subsequent breach of the same or any other term, covenant or condition. Consent to any act by one of the parties shall not be deemed to render unnecessary the obtaining of that party’s consent to any subsequent act. No breach of this Lease shall be deemed to have been waived unless the waiver is in a writing signed by the waiving party.

20.9 INABILITY TO PERFORM. In the event that either party shall be delayed or hindered in or prevented from the performance of any work or in performing any act required under this Lease by reason of any cause beyond the reasonable control of that party, then the performance of the work or the doing of the act shall be excused for the period of the delay and the time for performance shall be extended for a period equivalent to the period of the delay. The provisions of this Section 20.9 shall not operate to excuse Tenant from the prompt payment of Rent.

20.10 ENTIRE AGREEMENT. This Lease and its exhibits and other attachments cover in full each and every agreement of every kind between the parties concerning the Premises, the Building, and the Project, and all preliminary negotiations, oral agreements, understandings and/or practices, except those contained in this Lease, are superseded and of no further effect. Tenant waives its rights to rely on any representations or promises made by Landlord or others which are not contained in this Lease. No verbal agreement or implied covenant shall be held to modify the provisions of this Lease, any statute, law, or custom to the contrary notwithstanding.

20.11 QUIET ENJOYMENT. Upon the observance and performance of all the covenants, terms and conditions on Tenant’s part to be observed and performed, and subject to the other provisions of this Lease, Tenant shall have the right of quiet enjoyment and use of the Premises for the Term without hindrance or interruption by Landlord or any other person claiming by or through Landlord.

20.12 SURVIVAL. All covenants of Landlord or Tenant which reasonably would be intended to survive the expiration or sooner termination of this Lease, including without limitation any warranty or indemnity hereunder, shall so survive and continue to be binding upon and inure to the benefit of the respective parties and their successors and assigns.

ARTICLE 21. EXECUTION AND RECORDING

21.1 COUNTERPARTS; DIGITAL SIGNATURES. This Lease may be executed in one or more counterparts, each of which shall constitute an original and all of which shall be one and the same agreement. The parties agree to accept a digital image (including but not limited to an image in the form of a PDF, JPEG, GIF file, or other e-signature) of this Lease, if applicable, reflecting the execution of one or both of the parties, as a true and correct original.

21.2 CORPORATE AND PARTNERSHIP AUTHORITY. If Tenant is a corporation, limited liability company or partnership, each individual executing this Lease on behalf of the entity represents and warrants that such individual is duly authorized to execute and deliver this Lease and that this Lease is binding upon the corporation, limited liability company or partnership in accordance with its terms.

21.3 EXECUTION OF LEASE; NO OPTION OR OFFER. The submission of this Lease to Tenant shall be for examination purposes only, and shall not constitute an offer to or option for Tenant to lease the Premises. Execution of this Lease by Tenant and its return to Landlord shall not be binding upon Landlord, notwithstanding any time interval, until Landlord has in fact executed and delivered this Lease to Tenant, it being intended that this Lease shall only become effective upon execution by Landlord and delivery of a fully executed counterpart to Tenant.

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21.4 RECORDING. Tenant shall not record this Lease without the prior written consent of Landlord. Tenant, upon the request of Landlord, shall execute and acknowledge a “short form” memorandum of this Lease for recording purposes.

21.5 AMENDMENTS. No amendment or mutual termination of this Lease shall be effective unless in writing signed by authorized signatories of Tenant and Landlord, or by their respective successors in interest. No actions, policies, oral or informal arrangements, business dealings or other course of conduct by or between the parties shall be deemed to modify this Lease in any respect.

21.6 BROKER DISCLOSURE. By the execution of this Lease, each of Landlord and Tenant hereby acknowledge and confirm (a) receipt of a copy of a Disclosure Regarding Real Estate Agency Relationship conforming to the requirements of California Civil Code 2079.16, and (b) the agency relationships specified in Section 10 of the Basic Lease Provisions, which acknowledgement and confirmation is expressly made for the benefit of Tenant’s Broker identified in Section 10 of the Basic Lease Provisions, If there is no Tenant’s Broker so identified in Section 10 of the Basic Lease Provisions, then such acknowledgement and confirmation is expressly made for the benefit of Landlord’s Broker. By the execution of this Lease, Landlord and Tenant are executing the confirmation of the agency relationships set forth in Section 10 of the Basic Lease Provisions.

ARTICLE 22. MISCELLANEOUS

22.1 NONDISCLOSURE OF LEASE TERMS. Tenant and Landlord acknowledge that the content of this Lease contains confidential information. Except to the extent disclosure is required by law, Landlord and Tenant shall use commercially reasonable efforts to keep the content of this Lease confidential and shall not disclose such confidential information to any person or entity other than their respective financial, legal, space planning and other consultants, provided, however, that either party may disclose the terms to their prospective lenders, successors-in-interest and subtenants or assignees under this Lease or pursuant to legal requirement.

22.2 TENANT’S FINANCIAL STATEMENTS. The application, financial statements and tax returns, if any, submitted and certified to by Tenant as an accurate representation of its financial condition have been prepared, certified and submitted to Landlord as an inducement and consideration to Landlord to enter into this Lease. Tenant shall during the Term furnish Landlord with current annual financial statements accurately reflecting Tenant’s financial condition upon written request from Landlord within 10 business days following Landlord’s request; provided, however, that so long as Tenant is a publicly traded corporation on a nationally recognized stock exchange, the foregoing obligation to deliver the statements shall be waived.

22.3 MORTGAGEE PROTECTION. No act or failure to act on the part of Landlord which would otherwise entitle Tenant to be relieved of its obligations hereunder or to terminate this Lease shall result in such a release or termination unless (a) Tenant has given notice by registered or certified mail to any Mortgagee of a Mortgage covering the Building whose address has been furnished to Tenant and (b) such Mortgagee is afforded a reasonable opportunity to cure the default by Landlord (which shall in no event be less than 60 days), including, if necessary to effect the cure, time to obtain possession of the Building by power of sale or judicial foreclosure provided that such foreclosure remedy is diligently pursued. Tenant shall comply with any written directions by any Mortgagee to pay Rent due hereunder directly to such Mortgagee without determining whether a default exists under such Mortgagee’s Mortgage.

22.4 SDN LIST. Tenant hereby represents and warrants that neither Tenant nor any officer, director or employee of Tenant (collectively. “Tenant Parties”) is listed as a Specially Designated National and Blocked Person (“SDN”) on the list of such persons and entities issued by the U.S. Treasury Office of Foreign Assets Control (OFAC). In the event Tenant or any Tenant Party is or becomes listed as an SDN, Tenant shall be deemed in breach of this Lease and Landlord shall have the right to terminate this Lease immediately upon written notice to Tenant.

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LANDLORD:		TENANT:
FREEDOM CIRCLE LLC, a Delaware limited liability company		EASIC CORPORATION, a Delaware corporation
By:	/s/ Steven M. Case	By:	/s/ Richard Deranleau
	Steven M. Case	Printed Name:	Richard Deranleau
	Executive Vice President Office Properties	Title:	VP Finance & CFO
By:	/s/ Michael T. Bennett	By:	/s/ Ronnie Vasishta
	Michael T. Bennett	Printed Name:	Ronnie Vasishta
	Senior Vice President, Operations Office Properties	Title:	CEO

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EXHIBIT A

DESCRIPTION OF PREMISES

3940 Freedom Circle

1.

EXHIBIT B

Operating Expenses

(Net)

(a) From and after the Commencement Date, Tenant shall pay to Landlord, as additional rent, Tenant’s Share of all Operating Expenses, as defined in Section (f) below, incurred by Landlord in the operation of the Building and the Project. The term “Tenant’s Share” means 100% of the Operating Expenses determined by Landlord to benefit or relate substantially to the Building as opposed to other building(s) or the Project as a whole, plus that portion of any Operating Expenses determined by multiplying the cost of such item by a fraction, the numerator of which is the rentable square footage of the Premises and the denominator of which is the total rentable square footage, as reasonably determined from time to time by Landlord, of all or some of the buildings in the Project, for expenses reasonably determined by Landlord to benefit or relate substantially to all or some of the buildings in the Project rather than any specific building. In the event that Landlord determines that the Premises or the Building incur a non-proportional benefit from any expense, or is the non-proportional cause of any such expense, Landlord may allocate a greater percentage of such Operating Expense to the Premises or the Building. In the event that any management and/or overhead fee payable or imposed by Landlord for the management of Tenant’s Premises is calculated as a percentage of the rent payable by Tenant and other tenants of Landlord, then the full amount of such management and/or overhead fee which is attributable to the rent paid by Tenant shall be additional rent payable by Tenant, in full, provided, however, that Landlord may elect to include such full amount as part of Tenant’s Share of Operating Expenses.

(b) Prior to the Commencement Date (with respect to the partial “Expense Recovery Period” of the Lease (as defined in Item 7 of the Basic Lease Provisions) for the period from the Commencement Date to the end of the then current Expense Recovery Period), and prior to the start of each full or partial Expense Recovery Period thereafter, Landlord shall give Tenant a written estimate of the amount of Tenant’s Share of Operating Expenses for the applicable Expense Recovery Period. Tenant shall pay the estimated amounts to Landlord in equal monthly installments, in advance, concurrently with payments of Basic Rent, If Landlord has not furnished its written estimate for any Expense Recovery Period by the time set forth above, Tenant shall continue to pay monthly the estimated Tenant’s Share of Operating Expenses in effect during the prior Expense Recovery Period; provided that when the new estimate is delivered to Tenant, Tenant shall, at the next monthly payment date, pay any accrued estimated Tenant’s Share of Operating Expenses based upon the new estimate. Landlord may from time to time change the Expense Recovery Period to reflect a calendar year or a new fiscal year of Landlord, as applicable, in which event Tenant’s Share of Operating Expenses shall be equitably prorated for any partial year.

(c) Within 180 days after the end of each Expense Recovery Period, Landlord shall furnish to Tenant a statement (a “Reconciliation Statement”) showing in reasonable detail the Operating Expenses incurred by Landlord during such Expense Recovery Period and the actual or prorated Tenant’s Share thereof (including Landlord’s methodology for determining Tenant’s Share of the items of Operating Expenses shown therein), and the parties shall within 30 days thereafter make any payment or allowance necessary to adjust Tenant’s estimated payments of Tenant’s Share of Operating Expenses, if any, to the actual Tenant’s Share of Operating Expenses as shown by the Reconciliation Statement. Any delay or failure by Landlord in delivering any Reconciliation Statement shall not constitute a waiver of Landlord’s right to require Tenant to pay Tenant’s Share of Operating Expenses pursuant hereto. Any amount due Tenant shall be credited against installments next coming due under this Exhibit B, and any deficiency shall be paid by Tenant together with the next installment. Should Tenant fail to object in writing to Landlord’s determination of Tenant’s Share of Operating Expenses, or fail to give written notice of its intent to audit Landlord’s Operating Expenses pursuant to the provisions of the next succeeding paragraph, within 180 days following delivery of Landlord’s Reconciliation Statement, Landlord’s determination of Tenant’s Share of Operating Expenses for the applicable Expense Recovery Period shall be conclusive and binding.

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Provided that Tenant is not then in Default, Tenant shall have the right to audit or cause its consultants engaged on a non-contingency fee basis to audit Operating Expenses by inspecting Landlord’s general ledger of expenses not more than once during any Expense Recovery Period. However, to the extent that insurance premiums or any other component of Operating Expenses is determined by Landlord on the basis of an internal allocation of costs utilizing information Landlord in good faith deems proprietary, such expense component shall not be subject to audit so long as it does not exceed the amount per square foot typically imposed by landlords of other first class business parks in the vicinity of the Project. Tenant shall give notice to Landlord of Tenant’s intent to audit within 180 days after Landlord’s delivery to Tenant of Landlord’s Reconciliation Statement for the applicable Expense Recovery Period. Landlord shall promptly mail or email the applicable records to Tenant for the audit. If Tenant’s audit determines that the amount of Operating Expenses stated by Landlord to be payable by Tenant has been overstated by more than 5%, then subject to Landlord’s right to review and/or contest the audit results, Landlord shall reimburse Tenant for the reasonable costs of such audit. Tenant’s rent shall be appropriately adjusted to reflect any overstatement in Operating Expenses. All of the information obtained by Tenant in connection with such audit, as well as any compromise, settlement, or adjustment reached between Landlord and Tenant as a result thereof, shall be held in strict confidence and, except as may be required pursuant to litigation or other legitimate business purposes, shall not be disclosed to any third party, directly or indirectly, by Tenant or any of its officers, agents or employees. Landlord may require Tenant’s auditor to execute a separate confidentiality agreement affirming the foregoing as a condition precedent to any audit.

(d) Even though this Lease has terminated and the Tenant has vacated the Premises, when the final determination is made of Tenant’s Share of Operating Expenses for the Expense Recovery Period in which this Lease terminates, Tenant shall, subject to its audit rights as set forth in subsection (c) within 30 days of written notice pay the entire increase over the estimated Tenant’s Share of Operating Expenses already paid. Conversely, any overpayment by Tenant shall be rebated by Landlord to Tenant not later than 30 days after such final determination. However, in lieu thereof, Landlord may deliver a reasonable estimate of the anticipated reconciliation amount to Tenant prior to the Expiration Date of the Term, in which event the appropriate party shall fund the amount by the Expiration Date.

(e) If, at any time during any Expense Recovery Period, any one or more of the Operating Expenses are increased to a rate(s) or amount(s) in excess of the rate(s) or amount(s) used in calculating the estimated Tenant’s Share of Operating Expenses for the year, then the estimate of Tenant’s Share of Operating Expenses may be increased by written notice from Landlord for the month in which such rate(s) or amount(s) becomes effective and for all succeeding months by an amount equal to the estimated amount of Tenant’s Share of the increase. Landlord shall give Tenant written notice of the amount or estimated amount of the increase, the month in which the increase will become effective, Tenant’s Share thereof and the months for which the payments are due. Tenant shall pay the increase to Landlord as part of the Tenant’s monthly payments of estimated expenses as provided in paragraph (b) above, commencing with the month in which effective.

(f) The term “Operating Expenses” shall mean and include all Project Costs, as defined in and subject to the limitations set forth in Section (g) below, and Property Taxes, as defined in Section (h) below.

(g) The term “Project Costs” shall mean all expenses of operation, management, repair, replacement and maintenance of the Building and the Project, including without limitation all appurtenant Common Areas (as defined in Section 6.2 of the Lease), and shall include the following charges by way of illustration but not limitation: water and sewer charges; insurance premiums, deductibles, or reasonable premium equivalents or deductible equivalents should Landlord elect to self insure any risk that Landlord is authorized to insure hereunder; license, permit, and inspection fees; light; power; window washing; trash pickup; janitorial services to any interior Common Areas; heating, ventilating and air conditioning; supplies; materials; equipment; tools; reasonable fees for consulting services; access control/security costs, on and after November 1, 2016 establishment of reasonable reserves for replacement of the roof of the Building (provided that the applicable reserve shall be utilized in full before additional Project Costs are charged for the replacement and/or repair reserved for); non-capital costs incurred in connection with

2.

compliance with any laws or changes in laws applicable to the Building or the Project; the cost of capital improvements or replacements (other than tenant improvements for specific tenants) to the extent of the amortized amount thereof over the useful life of such capital improvements or replacements (or, if such capital improvements or replacements are anticipated to achieve a cost savings as to the Operating Expenses, any shorter estimated period of time over which the cost of the capital improvements or replacements would be recovered from the estimated cost savings) calculated at a market cost of funds, all as reasonably determined by Landlord (provided that such capital expenditures shall be limited to (1) improvements which are reasonably intended to increase or enhance building security and/or safety (such as lighting, life/fire safety systems, etc.), (2) repairs or replacements of the Building or its systems or to the Common Areas for functional (and not aesthetic) reasons, (3) compliance costs (as referred to in Section 1(b) of Exhibit G): and/or (4) expenditures incurred as a cost or labor saving measure or to affect other economies in the operation or maintenance of the Building or the Common Areas (collectively, “Permitted Capital Items”)) costs associated with the maintenance of an air conditioning, heating and ventilation service agreement, and maintenance of any communications or networked data transmission equipment, conduit, cabling, wiring and related telecommunications facilitating automation and control systems, remote telecommunication or data transmission infrastructure within the Building and/or the Project; labor; reasonably allocated wages and salaries, fringe benefits, and payroll taxes for administrative and other personnel directly applicable to the Building and/or Project, including both Landlord’s personnel and outside personnel; any expense incurred pursuant to Sections 6.1, 6.2, 7.2, 10.2, and Exhibits C and F of the Lease; and reasonable overhead and/or management fees for the professional operation of the Project. It is understood and agreed that Project Costs may include competitive charges for direct services (including, without limitation, management and/or operations services not to exceed 3% of gross revenue) provided by any subsidiary, division or affiliate of Landlord.

Notwithstanding the foregoing provisions of this Exhibit B, Project Costs shall exclude the following:

(1) All costs and expenses of operation of any child care, health club, restaurants and retail space in the Project;

(2) The wages and benefits of any employee who does not devote substantially all of his or her employed time to the Project unless such wages and benefits are prorated to reflect time spent on operating and managing the Project vis-a-vis time spent on matters unrelated to operating and managing the Project; provided that in no event shall Project Costs include wages and/or benefits attributable to personnel above the level of portfolio property manager or chief engineer;

(3) Interest on debt or amortization on any Mortgage or Mortgages encumbering the Building;

(4) All costs relating to activities for the marketing, solicitation and execution or renewal of leases of space in the Project, including, without limitation, broker commissions, accounting and legal fees, advertising, printing costs and brochures, space planning, tenant allowances, leasehold improvements and other tenant concessions:

(5) Costs associated with the sale or refinancing of the Project, including, without limitation, attorneys fees, accounting costs, closing costs, consulting or brokerage commissions, origination fees or points, and interest cost or charges;

(6) Costs associated with the acquisition of the fee, air rights or development rights with respect to the Project;

(7) Cost of decorating, redecorating, or tenant installations incurred in connection with preparing rentable space for a new tenant (or retaining a tenant);

3.

(8) Expenses in connection with services or other benefits which are not provided to Tenant or for which Tenant is charged for directly but which are provided to another tenant or occupant of the Project;

(9) Costs incurred by Landlord for repairs, replacements and/or restoration to or of the Building or the Project to the extent that Landlord is actually reimbursed or to which Landlord is entitled by insurance or condemnation proceeds or by tenants (other than through Operating Expense pass-through), warrantors or other third persons;

(10) Costs incurred by Landlord for improvements or replacements (including structural additions), repairs, equipment and tools which are of a “capital’ nature and/or which are considered “capital’ improvements or replacements under GAAP, except to the extent properly included in Project Costs;

(11) Overhead and profit increments paid to subsidiaries or affiliates of Landlord for services provided to the Building or any other portion of the Project to the extent the same exceeds the costs that would generally be charged for such services if rendered on a competitive basis (based upon a standard of similar office buildings in the general market area of the Premises) by unaffiliated third parties capable of providing such service;

(12) The cost of alterations of rentable space in the Building leased to Tenant and other tenants;

(13) Costs arising from the negligence or intentional misconduct of Landlord or its employees, contractors or agents;

(14) Costs incurred to remove, remedy, contain, or treat any hazardous material, which hazardous material in, on or under the Project (A) before the date of this Lease and (B) after the date hereof by Landlord or any other tenant of the Project or any other person other than Tenant, its employees, agents, licensees, subtenants or invitees, and is of such a nature, at that time, that a federal, state or municipal governmental authority, if it had then had knowledge of the presence of such hazardous material, in the state, and under the conditions, that it then exists on the Project, would have then required the removal of such hazardous material or other remedial or containment action with respect thereto;

(15) Penalties and interest charges as a result of Landlord not paying bills when due or within any grace period;

(16) Costs related to Landlord’s charitable or political contributions;

(17) Attorneys’ fees and other costs and expenses incurred in connection with negotiations or disputes with present or prospective tenants or other occupants of the Project, except those attorneys’ fees and other costs and expenses incurred in connection with negotiations, disputes or claims relating to items of Operating Expenses, enforcement of rules and regulations of the Project and such other matters relating to the maintenance of standards required of Landlord;

(18) Electric power costs or other utility costs for which any tenant directly contracts with the utility company;

(19) All costs associated with the operation of the business of the entity which constitutes “Landlord” (as distinguished from the costs of operating, maintaining, repairing, replacing and managing the Building or Project) including, but not limited to. Landlord’s or Landlord’s managing agent’s general corporate overhead and general administrative expenses;

4.

(20) Costs, fines or penalties incurred by Landlord due to the violation or alleged violation by Landlord of any law or governmental rule or regulation; and

(21) Ground rent or similar payments to a ground lessor.

(h) The term “Property Taxes” as used herein shall include any form of federal, state, county or local government or municipal taxes, fees, charges or other impositions of every kind (whether general, special, ordinary or extraordinary) related to the ownership, leasing or operation of the Premises, Building or Project, including without limitation, the following: (i) all real estate taxes or personal property taxes levied against the Premises, the Building or Project, as such property taxes may be reassessed from time to time; and (ii) other taxes, charges and assessments which are levied with respect to this Lease or to the Building and/or the Project, and any improvements, fixtures and equipment and other property of Landlord located in the Building and/or the Project, (iii) all assessments and fees for public improvements, services, and facilities and impacts thereon, including without limitation arising out of any Community Facilities Districts, “Mello Roos” districts, similar assessment districts, and any traffic impact mitigation assessments or fees; (iv) any tax, surcharge or assessment which shall be levied in addition to or in lieu of real estate or personal property taxes, and (v) taxes based on the receipt of rent (including gross receipts or sales taxes applicable to the receipt of rent), and (vi) costs and expenses incurred in contesting the amount or validity of any Property Tax by appropriate proceedings. Notwithstanding the foregoing, general net income or franchise taxes imposed against Landlord and transfer taxes shall be excluded.

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EXHIBIT C

UTILITIES AND SERVICE

1. Tenant shall be responsible for and shall pay promptly, directly to the appropriate supplier, all charges for electricity metered to the Premises, telephone, telecommunications service, janitorial service, interior landscape maintenance and all other utilities, materials and services furnished directly to Tenant or the Premises or used by Tenant in, on or about the Premises during the Term, together with any taxes thereon. Landlord shall make a reasonable determination of Tenant’s proportionate share of the cost of utilities and services provided by Landlord that are not separately metered to the Premises (e.g. refuse pickup), and Tenant shall pay such amount to Landlord, as an item of additional rent, within 30 days after delivery of Landlord’s statement or invoice therefor. Alternatively, Landlord may elect to include such cost in the definition of Project Costs in which event Tenant shall pay Tenants proportionate share of such costs in the manner set forth in Section 4.2. Tenant shall also pay to Landlord as an Item of additional rent, within 30 days after delivery of Landlord’s statement or invoice therefor, Landlord’s “standard charges” (as hereinafter defined, which shall be in addition to the electricity charge paid to the utility provider) for “after hours” usage by Tenant of each HVAC unit servicing the Premises, except no “after hours” charges shall be applicable for any supplemental HVAC units servicing the lab and server room portions of the Premises. “After hours” shall mean more than an average of 9.5 hours of usage per day determined on a monthly basis during the Term. “After hours” usage shall be determined based upon the operation of the applicable HVAC unit during each monthly period on a “non-cumulative” basis (that is, without regard to Tenant’s usage or nonusage of other unit(s) serving the Premises, or of the applicable unit during other periods of the Term). As used herein, “standard charges” shall mean the following charges for each hour of “after hours” use (in addition to the applicable electricity charges paid to the utility provider) of the following described HVAC units: (i) $5.00 per hour for 1-5 ton HVAC units, (ii) $7.50 per hour for 6-30 ton HVAC units and (iii) $10.00 per hour for HVAC units of greater than 30 tons. After hours charges shall become effective only beginning on November 1, 2016.

2. Landlord shall provide reasonable amounts of electric current for normal lighting by Landlord’s standard overhead fluorescent and incandescent fixtures and for the operation of office equipment consistent in type and quantity with that utilized by typical office tenants of the Building and Project and Tenant Improvement plans as shown in Exhibit X, and water for lavatory purposes.

3. Landlord shall furnish tap water for drinking, personal hygiene and lavatory purposes only.

4. The costs of operating, maintaining and repairing any supplemental air conditioning unit serving only the Premises shall be borne solely by Tenant.

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EXHIBIT D

TENANT’S INSURANCE

The following requirements for Tenant’s insurance shall be in effect during the Term, and Tenant shall also cause any subtenant to comply with the requirements. Landlord reserves the right to adopt reasonable nondiscriminatory modifications and additions to these requirements.

1. Tenant shall maintain, at its sole cost and expense, during the entire Term: (I) commercial general liability insurance with respect to the Premises and the operations of Tenant in, on or about the Premises, on a policy form that is at least as broad as Insurance Service Office (ISO) CGL 00 01, which policy(ies) shall be written on an “occurrence” basis and for not less than $2,000,000 combined single limit per occurrence for bodily injury, death, and property damage liability; (ii) workers compensation insurance coverage as required by law, together with employers’ liability insurance coverage of at least $1,000,000 each accident and each disease; (iii) with respect to Alterations constructed by Tenant under this Lease, builder’s risk insurance, in an amount equal to the replacement cost of the work (which insurance may at Tenant’s election be carried by Tenant’s contractor; and (iv) insurance against fire, vandalism, malicious mischief and such other additional perils as may be included in a standard “special form” policy, Insuring all Alterations, trade fixtures, furnishings, equipment and items of personal property in the Premises, in an amount equal to not less than 90% of their replacement cost (with replacement cost endorsement), which policy shall also include business interruption coverage in an amount sufficient to cover 1 year of loss. In no event shall the limits of any policy be considered as limiting the liability of Tenant under this Lease.

2. All policies of insurance required to be carried by Tenant pursuant to this Exhibit D shall be written by insurance companies authorized to do business in the State of California and with a general policyholder rating of not less than “A-” and financial rating of not less than “VIII” in the most current Best’s Insurance Report. The deductible or other retained limit under any policy carried by Tenant shall be commercially reasonable, and Tenant shall be responsible for payment of such deductible or retained limit with waiver of subrogation in favor of Landlord. Any insurance required of Tenant may be furnished by Tenant under any blanket policy carried by it or under a separate policy. A certificate of insurance, certifying that the policy has been issued, provides the coverage required by this Exhibit and contains the required provisions, together with endorsements reasonably acceptable to Landlord evidencing the waiver of subrogation and additional insured provisions required below, shall be delivered to Landlord prior to the date Tenant is given the right of possession of the Premises. Proper evidence of the renewal of any insurance coverage shall also be delivered to Landlord prior to the expiration of the coverage. In the event of a loss covered by any policy under which Landlord is an additional insured, Landlord shall be entitled to review a copy of such policy.

3. Tenant’s commercial general liability insurance shall contain a provision that the policy shall be primary to and noncontributory with any policies carried by Landlord, together with a provision including Landlord and any other parties in interest designated by Landlord as additional insureds. Tenant’s policies described in Subsections 1 (ii), (iii) and (iv) above shall each contain a waiver by the insurer of any right to subrogation against Landlord, Its agents, employees, contractors and representatives. Tenant also waives its right of recovery for any deductible or retained limit under same policies enumerated above. Tenant shall deliver to Landlord promptly after receipt thereof a copy of any notice received by Tenant from its insurer of any cancellation or a material change in the insurance coverage provided by such insurer. Tenant shall also name Landlord as an additional insured on any excess or umbrella liability insurance policy carried by Tenant.

NOTICE TO TENANT: IN ACCORDANCE WITH THE TERMS OF THIS LEASE, TENANT MUST PROVIDE EVIDENCE OF THE REQUIRED INSURANCE TO LANDLORD’S MANAGEMENT AGENT PRIOR TO BEING AFFORDED ACCESS TO THE PREMISES.

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EXHIBIT E

RULES AND REGULATIONS

The following Rules and Regulations shall be in effect at the Building. Landlord reserves the right to adopt reasonable nondiscriminatory modifications and additions at any time. In the case of any conflict between these regulations and the Lease, the Lease shall be controlling.

1. The sidewalks, halls, passages, elevators, stairways, and other common areas shall not be obstructed by Tenant or used by it for storage, for depositing items, or for any purpose other than for ingress to and egress from the Premises. Should Tenant have access to any balcony or patio area, Tenant shall not place any furniture other personal property in such area without the prior written approval of Landlord.

2. Neither Tenant nor any employee or contractor of Tenant shall go upon the roof of the Building without the prior written consent of Landlord.

3. [intentionally Deleted]

4. No antenna or satellite dish shall be installed by Tenant without the prior written agreement of Landlord.

5. The sashes, sash doors, windows, glass lights, solar film and/or screen, and any lights or skylights that reflect or admit light into the halls or other places of the Building shall not be covered or obstructed. If Landlord, by a notice in writing to Tenant, shall object to any curtain, blind, tinting, shade or screen attached to, or hung in, or used in connection with, any window or door of the Premises, the use of that curtain, blind, tinting, shade or screen shall be promptly discontinued and removed by Tenant. No awnings shall be permitted an any part of the Premises.

6. The installation and location of any unusually heavy equipment in the Premises, including without limitation file storage units, safes and electronic data processing equipment, shall require the prior written approval of Landlord.

7. Any concealed pipes or tubing used by Tenant to transmit water to an appliance or device in the Premises must be made of copper or stainless steel, and in no event shall plastic tubing be used for that purpose.

8. Tenant shall not place any lock(s) on any door in the Premises or Building without Landlord’s prior written consent, which consent shall not be unreasonably withheld. Upon the termination of its tenancy, Tenant shall deliver to Landlord all the keys to offices, rooms and toilet rooms and all access cards which shall have been furnished to Tenant or which Tenant shall have had made.

9. Tenant shall not install equipment requiring electrical or air conditioning service in excess of that to be provided by Landlord under the Lease without prior written approval from Landlord.

10. Tenant shall not use space heaters within the Premises.

11. Tenant shall not do or permit anything to be done in the Premises, or bring or keep anything in the Premises, which shall in any way increase the Insurance on the Building, or on the property kept in the Building, or interfere with the rights of other tenants, or conflict with any government rule or regulation.

12. Tenant shall not use or keep any foul or noxious gas or substance in the Premises.

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13. Tenant shall not permit any pets or animals in or about the Building. Bona fide service animals are permitted provided such service animals are pre-approved by Landlord, remain under the direct control of the individual they serve at all times, and do not disturb or threaten others.

14. Neither Tenant nor its employees, agents, contractors, invitees or licensees shall bring any firearm, whether loaded or unloaded, into the Project at any time.

15. Smoking, including via personal vaporizers or other electronic cigarettes, anywhere within the Premises or Building is strictly prohibited, and Landlord may enforce such prohibition pursuant to Landlord’s leasehold remedies, Smoking is permitted outside the Building and within the project only in areas designated by Landlord.

16. Tenant shall not install an aquarium of any size in the Premises unless otherwise approved by Landlord.

17. Tenant shall not utilize any name selected by Landlord from time to time for the Building and/or the Project as any part of Tenant’s corporate or trade name. Landlord shall have the right to change the name, number or designation of the Building or Project without liability to Tenant. Tenant shall not use any picture of the Building in its advertising, stationery or in any other manner.

18. Tenant shall, upon request by Landlord, supply Landlord with the names and telephone numbers of personnel designated by Tenant to be contacted on an after-hours basis should circumstances warrant.

19. Landlord may from time to time grant tenants individual and temporary variances from these Rules, provided that any variance does not have a material adverse effect on the use and enjoyment of the Premises by Tenant.

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EXHIBIT F

PARKING

Tenant shall be entitled to the number of vehicle parking spaces set forth in Item 11 of the Basic Lease Provisions at no charge, which spaces shall be unreserved and unassigned, on those portions of the Common Areas designated by Landlord for parking. Tenant shall not use more parking spaces than such number. All parking spaces shall be used only for parking of vehicles no larger than full size passenger automobiles, sport utility vehicles or pickup trucks. Tenant shall not permit or allow any vehicles that belong to or are controlled by Tenant or Tenant’s employees, suppliers, shippers, customers or invitees to be loaded, unloaded or parked In areas other than those designated by Landlord for such activities. If Tenant permits or allows any of the prohibited activities described above, then Landlord shall have the right, without notice, in addition to such other rights and remedies that Landlord may have, to remove or tow away the vehicle involved and charge the costs to Tenant. Parking within the Common Areas shall be limited to striped parking stalls, and no parking shall be permitted in any driveways, access ways or in any area which would prohibit or impede the free flow of traffic within the Common Areas. There shall be no parking of any vehicles for longer than a forty-eight (48) hour period unless otherwise authorized by Landlord, and vehicles which have been abandoned or parked in violation of the terms hereof may be towed away at the owner’s expense. Nothing contained in this Lease shall be deemed to create liability upon Landlord for any damage to motor vehicles of visitors or employees, for any loss of property from within those motor vehicles, or for any injury to Tenant, its visitors or employees, unless ultimately determined to be caused by the sole negligence or willful misconduct of Landlord. Landlord shall have the right to establish, and from time to time amend, and to enforce against all users all reasonable rules and regulations that Landlord may deem necessary and advisable for the proper and efficient operation and maintenance of parking within the Common Areas. Landlord shall have the right to construct, maintain and operate lighting facilities within the parking areas; to change the area, level, location and arrangement of the parking areas and improvements therein; to restrict parking by tenants, their officers, agents and employees to employee parking areas; and to do and perform such other acts in and to the parking areas and improvements therein as, in the use of good business judgment, Landlord shall determine to be advisable. Any person using the parking area shall observe all directional signs and arrows and any posted speed limits. In no event shall Tenant interfere with the use and enjoyment of the parking area by other tenants of the Project or their employees or invitees. Parking areas shall be used only for parking vehicles. Washing, waxing, cleaning or servicing of vehicles, or the storage of vehicles for longer than 48-hours, is prohibited unless otherwise authorized by Landlord. Tenant shall be liable for any damage to the parking areas caused by Tenant or Tenant’s employees, suppliers, shippers, customers or invitees, including without limitation damage from excess oil leakage. Tenant shall have no right to install any fixtures, equipment or personal property in the parking areas. Tenant shall not assign or sublet any of the vehicle parking spaces, either voluntarily or by operation of law, without the prior written consent of Landlord, except in connection with an authorized assignment of this Lease or subletting of the Premises.

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EXHIBIT G

ADDITIONAL PROVISIONS

The following additional provisions shall be binding on Landlord and Tenant:

1. LANDLORD’S WARRANTY.

(a) Landlord warrants to Tenant that the roof, foundation, footings, slab, structural walls exterior windows (including seals), and skylights (including seals), of the Building are in good operating condition and repair. Landlord also warrants that the Tenant Improvements, doors, plumbing, fire sprinkler/life safety system, lighting, heating, ventilation and air conditioning systems and electrical systems serving the Premises shall be in good operating condition on the Commencement Date and free of latent defects in the construction thereof. Provided that Tenant shall notify Landlord of a non-compliance with the foregoing warranty (and in such notice tenant shall specify the nature and extent of such non-compliance) on or before 270 days following the Commencement Date, then Landlord shall promptly rectify the same at Landlord’s cost and expense (and not a Project Cost). Notwithstanding the foregoing, Landlord’s warranty obligation contained in this Section shall not apply: (i) to the costs and expenses of periodic maintenance of the roof, plumbing, fire sprinkler system, lighting, heating, ventilation and air conditioning systems and electrical systems serving the Premises, nor (ii) to the extent of the negligence or willful misconduct by Tenant, its employees, agents, contractors, licensees or invitees (in which case Tenant shall be responsible for the reasonable costs of such repairs and/or replacements).

(b) Landlord shall correct, repair and/or replace any non-compliance of the Building and/or the Common Areas with all building permits and codes in effect and applicable as of the Commencement Date of this Lease, including without limitation, the provisions of Title III of the Americans With Disabilities Act (“ADA”). Said costs of compliance shall be Landlord’s sole cost and expense and shall not be part of Project Costs. Landlord shall correct, repair or replace any non-compliance of the Common Areas with any revisions or amendments to applicable building codes, including the ADA, becoming effective after the Commencement Date, provided that the amortized cost of such repairs or replacements (amortized over the useful life thereof) shall be included as Project Costs payable by Tenant. All other ADA compliance issues which pertain to the Premises, including without limitation, in connection with Tenant’s construction of any Alterations or other improvements in the Premises (and any resulting ADA compliance requirements in the Common Areas if Landlord shall consent to same as more particularly provided in Section 7.3 of this Lease) and the operation of Tenant’s business and employment practices in the Premises, shall be the responsibility of Tenant at its sole cost and expense. The repairs, corrections or replacements required of Landlord or of Tenant under the foregoing provisions of this Section shall be made promptly following notice of non-compliance from any applicable governmental agency.

2. RIGHT TO EXTEND THIS LEASE. Provided that no Default exists under any provision of this Lease, either at the time of exercise of the extension right granted herein or at the time of the commencement of such extension, and provided further that Tenant is occupying the entire Premises and has not assigned any of its interest in this Lease (other than in connection with a Permitted Transfer), then Tenant may extend the Term of this Lease for one (1) period of sixty (60) months. Tenant shall exercise its right to extend the Term by and only by delivering to Landlord, not less than nine (9) months or more than twelve (12) months prior to the expiration date of the Term, Tenant’s irrevocable written notice of its commitment to extend (the “Commitment Notice”). The Basic Rent payable under the Lease during any extension of the Term shall be determined as provided in the following provisions.

The Basic Rent payable under the Lease during the extension period of the Term shall be at ninety-five percent of the prevailing fair market rental rate (including periodic adjustments) for comparable and similarly improved space based upon new and renewal, non-equity leases of space comparable to the Premises, pursuant to arm’s length transactions in Comparable Buildings (hereinafter defined) in the vicinity as of the commencement of the extension period (the “95% FMR”). “Comparable Buildings” shall mean buildings being leased in the vicinity based upon similar age and quality (or if such Comparable Buildings, or comparable space within Comparable Buildings are not available, adjustments shall be

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made in determination to the 95% FMR to reflect the age and quality of the Building and the Premises as contrasted to other buildings used for comparable purposes), with similar amenities, taking into consideration size, location, floor level, proposed term of the lease, extent of services to be provided, the time that the particular rate under consideration became effective or is to become effective, annual escalations, as well as all tenant concessions and inducements. Additionally, in considering comparable space within Comparable Buildings, appropriate adjustments shall be made to the annual rents to account for any abatement provisions reflecting free rent.

If Landlord and Tenant have not by then been able to agree upon the Basic Rent for the extension of the Term, then within one hundred twenty (120) and ninety (90) days prior to the expiration date of the Term, Landlord shall notify Tenant in writing (“Landlord’s Determination”) of the Basic Rent that would reflect the 95% FMR for the Premises for the extension period. Should Tenant disagree with the Landlord’s Determination, then Tenant shall, not later than thirty (30) days thereafter, notify Landlord in writing of Tenant’s determination of the 95% FMR (“Tenant’s Determination”). Within ten (10) days following delivery of the Tenant’s Determination, the parties shall attempt to agree on an appraiser to determine the 95% FMR. If the parties are unable to agree in that time, then each party shall designate an appraiser within ten (10) days thereafter. Should either party fail to so designate an appraiser within that time, then the appraiser designated by the other party shall determine the 95% FMR for the Premises. Should each of the parties timely designate an appraiser, then the two appraisers so designated shall appoint a third appraiser who shall, acting alone, determine the 95% FMR for the Premises. Any appraiser designated hereunder shall have an MAI certification with not less than five (5) years experience in the valuation of commercial industrial buildings in the vicinity of the Project.

Within thirty (30) days following the selection of the appraiser and such appraiser’s receipt of the Landlord’s Determination and the Tenant’s Determination, the appraiser shall determine whether the Landlord’s Determination or the Tenant’s Determination more accurately reflects the 95% FMR for the 60-month renewal of the Lease for the Premises, as reasonably extrapolated to the commencement of the extension period. Accordingly, either the Landlord’s Determination or the Tenant’s Determination shall be selected by the appraiser as the 95% FMR for the extension period. In making such determination, the appraiser shall consider rental comparables for similarly improved space with appropriate adjustment for location and quality of project, but the appraiser shall not attribute any factor for market tenant improvement allowances or brokerage commissions in making its determination of the 95% FMR. At any time before the decision of the appraiser is rendered, either party may, by written notice to the other party, accept the rental terms submitted by the other party, in which event such terms shall be deemed adopted as the agreed fair market rental. Each party shall pay the fees of the appraiser appointed by such party, and the fees of the third appraiser (or the mutually agreed upon appraiser, if the parties agree upon a single appraiser) shall be shared equally by the parties.

Within twenty (20) days after the determination of the 95% FMR, Landlord shall prepare an appropriate amendment to this Lease for the extension period, and Tenant shall promptly review (and revise if necessary) and execute and return same to Landlord. Should the 95% FMR not be established by the commencement of the extension period, then Tenant shall continue paying rent at the rate in effect during the last month of the initial Term, and a lump sum adjustment shall be made promptly upon the determination of such new rental,

If Tenant fails to timely exercise the extension right granted herein within the time period expressly set forth for exercise by Tenant in the initial paragraph of this Section, Tenant’s right to extend the Term shall be extinguished and the Lease shall automatically terminate as of the expiration date of the Term, without any extension and without any liability to Landlord. Tenant shall have no other right to extend the Term beyond the single sixty (60) month extension period created by this Section. Unless agreed to in a writing signed by Landlord and Tenant, any extension of the Term, whether created by an amendment to this Lease or by a holdover of the Premises by Tenant, or otherwise, shall be deemed a part of, and not in addition to, any duly exercised extension period permitted by this paragraph. Tenant’s rights under this Section shall belong solely to eASIC Corporation, a Delaware corporation, and to the assignee of this Lease pursuant to a Permitted Transfer and any attempted assignment or transfer of such rights shall be void and of no force and effect (other than in connection with a Permitted Transfer).

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3. TENANT’S RIGHT TO TERMINATE. Provided that no Default exists under any provision of this Lease, either at the time of Tenant’s election of its right to terminate granted herein or as of the effective Termination Date, Tenant shall have the one-time right to terminate this Lease effective as of the expiration of the 36th full calendar month of the initial Term of the Lease (the “Termination Date”), provided Tenant has delivered its irrevocable written notice of such election to terminate (the “Termination Notice”) to Landlord not later than 6 full calendar months prior to the Termination Date. All rental and other costs due under this Lease for the Premises shall be due and payable by Tenant to Landlord through the Termination Date. In addition, should Tenant exercise the foregoing right to terminate, Tenant shall pay to Landlord on or before the Termination Date, a separate termination fee, in the amount of $156,600.00 (i.e. 3 months Basic Rent at the scheduled rate in effect for the 36 month of the initial Term. Any such termination by Tenant shall not abrogate any obligation existing under the Lease as of the Termination Date or otherwise attributable to Tenant’s occupancy thereof.

4. COMMUNICATIONS EQUIPMENT. Landlord hereby grants to Tenant a non-exclusive license (the “License”) to install, maintain and operate on the roof of the Building a single antenna or satellite dish not exceeding forty-eight inches (48”) in height or thirty-six inches (36”) in diameter (the “Antenna”) in accordance with and subject to the terms and conditions set forth below. The Antenna shall be installed at a location designated by Landlord and reasonably acceptable to Tenant (“Licensed Area”). The Licensed Area shall be considered to be a part of the Premises for all purposes under the Lease, and except as otherwise expressly provided in this Section all provisions applicable to the use of the Premises under the Lease shall apply to the Licensed Area and its use by Tenant.

(1) The Term of the License shall be coterminous with this Lease;

(2) Tenant shall not be obligated to pay any license fee for the use of the Licensed Area pursuant to this Section during the Term of this Lease.

(3) Tenant shall use the Licensed Area only for the installation, operation, repair, replacement and maintenance of the Antenna and the necessary mechanical and electrical equipment to service said Antenna and for no other use or purpose. The installation of the Antenna and all equipment and facilities related thereto, including any required screening for the Antenna and any required conduit from the Premises to the Antenna, shall be deemed to constitute an Alteration subject to the provisions of Section 7.3 of the Lease, provided that Landlord shall not unreasonably withhold its approval of the same. Landlord may require appropriate screening for the Antenna as a condition of Landlord’s approval of the installation of the Antenna. Tenant may have access to the Licensed Area for such uses during normal business hours and at times upon reasonably prior notice to Landlord and shall reimburse Landlord for any reasonably out-of-pocket expenses incurred by Landlord in connection therewith;

(4) The Antenna shall be used only for transmitting and/or receiving data, audio and/or video signals to and from Tenant’s facilities within the Premises for Tenant’s use, and shall not be used or permitted to be used by Tenant for purposes of broadcasting signals to the public or to provide telecommunications or other communications transmitting or receiving services to any third parties;

(5) Landlord reserves the right upon reasonable prior written notice to Tenant to require the removal of the Antenna should Landlord reasonably determine that its presence results in material damage to the Building unless Tenant makes satisfactory arrangements to protect Landlord therefrom;

(6) Tenant shall require its employees, when using the Licensed Area, to stay within the immediate vicinity thereof. In addition, in the event any communications system or broadcast or receiving facilities are operating in the area, Tenant shall at all times during the term of the License conduct its operations so as to ensure that such system or facilities shall not be subjected to harmful interference as a result of such operations by Tenant. Upon notification from Landlord of any such interference, Tenant agrees to immediately take the necessary steps to correct such situation, and Tenants failure to do so shall be deemed a default under the terms of this Lease.

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(7) During the term of the License, Tenant shall comply with any standards promulgated by applicable governmental authorities or otherwise reasonably established by Landlord regarding the generation of electromagnetic fields. Should Landlord determine in good faith at any time that the Antenna poses a health or safety hazard to occupants of the Building, Landlord may require Tenant to make arrangements satisfactory to Landlord to mitigate such hazard or, if Tenant either fails or is unable to make such satisfactory arrangements, to remove the Antenna. Any claim or liability resulting from the use of the Antenna or the Licensed Area shall be subject to the indemnification provisions of this Lease applicable to Tenants use of the Premises;

(8) During the term of the License, Tenant shall pay all taxes attributable to the Antenna and other equipment owned and installed by Tenant, and Tenant shall assure and provide Landlord with evidence that the Licensed Area and Tenant’s use thereof are subject to the insurance coverages otherwise required to be maintained by Tenant as to the Premises pursuant to Exhibit 0; and

(9) Upon the expiration or sooner termination of the Lease, Tenant shall remove the Antenna and all related equipment and facilities, including any conduit from the Premises to the Antenna, from the Licensed Area and any other portions of the Building within or upon which the same may be installed, and shall restore the Licensed Area and all other areas affected by such removal to their original condition, reasonable wear and tear excepted, all at its sole cost and expense.

(10) Tenant’s rights under this Section belong solely to eASIC corporation, a Delaware corporation, and any attempted assignment or transfer of such rights shall be void and of no force and effect.

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EXHIBIT H

LANDLORD’S DISCLOSURES

Portions of the structures on the Premises may contain asbestos-containing materials. Accordingly, Tenant agrees that it will not make any repairs or alterations to the structures on the Premises: (a) without inquiring from Landlord whether Tenant’s planned repairs or alterations are likely to disturb asbestos-containing materials in the structures, and (b) if, in Landlord’s judgment, the planned repairs or alterations will disturb the asbestos-containing materials, not to proceed with such planned repairs or alterations without securing Landlord’s written prior consent, which consent shall not be unreasonably withheld. Landlord shall comply with the California “Connelly Act” and provide the asbestos notification letter periodically as required thereby or by other applicable laws, and Tenant shall post in the Premises and/or otherwise provide copies of such notice to all of Tenant’s “employees” and “owners”, as those terms are defined in the Connelly Act.

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EXHIBIT J

THE IRVINE COMPANY — INVESTMENT PROPERTIES GROUP

HAZARDOUS MATERIAL SURVEY FORM

The purpose of this form is to obtain information regarding the use of hazardous substances on Investment Properties Group (“IPG”) property. Prospective tenants and contractors should answer the questions in light of their proposed activities on the premises. Existing tenants and contractors should answer the questions as they relate to ongoing activities on the premises and should update any information previously submitted.

If additional space is needed to answer the questions, you may attach separate sheets of paper to this form. When completed, the form should be sent to the following address:

THE IRVINE COMPANY MANAGEMENT OFFICE

5451 Great America Parkway, Suite 201

Santa Clara, CA 95054

Your cooperation in this matter is appreciated. If you have any questions, please call your property manager at (949) 720-4400 for assistance.

1.	GENERAL INFORMATION.
	Name of Responding Company:
	Check all that apply:	Tenant         (    )	Contractor (    )
		Prospective  (    )	Existing     (    )
	Mailing Address:
	Contact person & Title:
	Telephone Number: (    )
	Current TIC Tenant(s):
	Address of Lease Premises:
	Length of Lease or Contract Term:
	Prospective TIC Tenant(s):
	Address of Leased Premises:
	Address of Current Operations:
	Describe the proposed operations to take place on the property, including principal products manufactured or services to be conducted. Existing tenants and contractors should describe any proposed changes to ongoing operations.
2.	HAZARDOUS MATERIALS. For the purposes of this Survey Form, the term “hazardous material” means any raw material, product or agent considered hazardous under any state or federal law. The term does not include wastes which are intended to be discarded.

2.1	Will any hazardous materials be used or stored on site?
	Chemical Products	Yes (    )	No (    )
	Biological Hazards/
	Infectious Wastes	Yes (    )	No (    )
	Radioactive Materials	Yes (    )	No (    )
	Petroleum Products	Yes (    )	No (    )

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2.2 List any hazardous materials to be used or stored, the quantities that will be on-site at any given time, and the location and method of storage (e.g., bottles in storage closet on the premises).

Hazardous Materials Location and Method
of Storage Quantity

2.3 Is any underground storage of hazardous materials proposed or currently conducted on the premises? Yes (    ) No (    )

If yes, describe the materials to be stored, and the size and construction of the tank. Attach copies of any permits obtained for the underground storage of such substances.

3. HAZARDOUS WASTE. For the purposes of this Survey Form, the term “hazardous waste’ means any waste (including biological, infectious or radioactive waste) considered hazardous under any state or federal law, and which is intended to be discarded.

3.1 List any hazardous waste generated or to be generated on the premises, and indicate the quantity generated on a monthly basis.

Hazardous Materials Location and Method
of Storage Quantity

3.2 Describe the method(s) of disposal (including recycling) for each waste. Indicate where and how often disposal will take place.

Hazardous Materials Location and Method
of Storage Quantity

3.3 Is any treatment or processing of hazardous, infectious or radioactive wastes currently conducted or proposed to be conducted on the premise?

Yes (    ) No (    )

If yes, please describe any existing or proposed treatment methods.

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3.4 Attach copies of any hazardous waste permits or licenses issued to your company with respect to its operations on the premises.

4. SPILLS

4.1 During the past year, have any spills or releases of hazardous materials occurred on the premises? Yes (    ) No (    )

If so, please describe the spill and attach the results of any testing conducted to determine the extent of such spills.

4.2 Were any agencies notified in connection with such spills? Yes (    ) No (    )

If so, attach copies of any spill reports or other correspondence with regulatory agencies.

4.3 Were any clean-up actions undertaken in connection with the spills?

Yes (    ) No (    )

If so, briefly describe the actions taken. Attach copies of any clearance letters obtained from any regulatory agencies involved and the results of any final soil or groundwater sampling done upon completion of the clean-up work.

5. WASTEWATER TREATMENT/DISCHARGE

5.1 Do you discharge industrial wastewater to:

             storm drain?                 sewer?

             surface water?              no industrial discharge

5.2 Is your industrial wastewater treated before discharge? Yes (    ) No (    )

If yes, describe the type of treatment conducted.

5.3 Attach copies of any wastewater discharge permits issued to your company with respect to its operations on the premises.

6. AIR DISCHARGES.

6.1 Do you have any air filtration systems or stacks that discharge into the air?

Yes (    ) No (    )

6.2 Do you operate any equipment that requires air emissions permits?

Yes (    ) No (    )

6.3 Attach copies of any air discharge permits pertaining to these operations.

3.

7. HAZARDOUS MATERIALS DISCLOSURES.

7.1 Does your company handle an aggregate of at least 500 pounds, 55 gallons or 200 cubic feet of hazardous material at any given time? Yes (    ) No (    )

7.2 Has your company prepared a Hazardous Materials Disclosure — Chemical Inventory and Business Emergency Plan or similar disclosure document pursuant to state or county requirements? Yes (    ) No (    )

If so, attach a copy.

7.3 Are any of the chemicals used in your operations regulated under Proposition 65?

If so, describe the procedures followed to comply with these requirements.

7.4 Is your company subject to OSHA Hazard Communication Standard Requirements? Yes (    ) No (     )

If so, describe the procedures followed to comply with these requirements.

8. ANIMAL TESTING.

8.1 Does your company bring or intend to bring live animals onto the premises for research or development purposes?

Yes (    ) No (    )

If so, describe the activity.

8.2 Does your company bring or intend to bring animal body parts or bodily fluids onto the premises for research or development purposes? Yes (    ) No (    )

If so, describe the activity.

9. ENFORCEMENT ACTIONS, COMPLAINTS.

9.1 Has your company ever been subject to any agency enforcement actions, administrative orders, lawsuits, or consent orders/decrees regarding environmental compliance or health and safety? Yes (    ) No (    )

If so, describe the actions and any continuing obligations imposed as a result of these actions.

4.

9.2 Has your company ever received any request for information, notice of violation or demand letter, complaint, or inquiry regarding environmental compliance or health and safety? Yes (    ) No (    )

9.3 Has an environmental audit ever been conducted which concerned operations or activities on premises occupied by you? Yes (    ) No (    )

9.4 If you answered “yes” to any questions in this section, describe the environmental action or complaint and any continuing compliance obligation imposed as a result of the same.

By:

Name:

Title:

Date:

5.

EXHIBIT X

WORK LETTER

BUILD TO SUIT

(Turn-key)

The tenant improvement work (the “Tenant Improvements” and the “Tenant Improvement Work”) shall consist of the work, including work in place as of the date hereof, required to complete the improvements to the Premises pursuant to approved plans, specifications, which are consistent with the permit submittal set prepared by AAI, Project No. 4639, Sheet No. A-120 (last revised June 29, 2015) attached as Schedule 1 to this Work Letter. The Tenant Improvement Work shall be performed by a contractor selected by Landlord and in accordance with the requirements and procedures set forth below.

1. ARCHITECTURAL AND CONSTRUCTION PROCEDURES.

A. Landlord shall cause its contractor to construct the Tenant Improvements at Landlord’s sole cost and expense, provided that any additional cost resulting from “Changes” (as hereinafter defined) requested by Tenant and “Alternates” shown in the Plan which are elected by Tenant (if any) shall be borne solely by Tenant and paid to Landlord as hereinafter provided. Unless otherwise specified in the Plan, all materials, specifications and finishes utilized in constructing the Tenant Improvements shall be Landlord’s building standard tenant improvements, materials and specifications for the Project (“Standard Improvements”), except for those additions or variations to Building Standard Improvements expressly approved by Landlord and noted on the Plan (any such addition or variation from the Standard Improvements shall be referred to herein as a “Non-Standard Improvement”). Should Landlord submit any additional plans, equipment specification sheets, or other matters to Tenant for approval or completion in connection with the Tenant Improvement Work, Tenant shall respond in writing, as appropriate, within 5 business days unless a shorter period is provided herein. Tenant shall not unreasonably withhold its approval of any matter, and any disapproval shall be limited to items not previously approved by Tenant in the Plan or otherwise.

B. In the event that Tenant requests in writing a revision to the Plan (“Change”), and Landlord so approves such Change as provided in the Section next below, Landlord shall advise Tenant by written change order as soon as is practical of any increase in the cost to complete the Tenant Improvement Work that such Change would cause. Such cost shall include an construction management fee to be paid to Landlord or to Landlord’s management agent in the amount of 3% of the cost of such Change. Tenant shall approve or disapprove such change order, if any, in writing within 2 business days following Tenant’s receipt of such change order. If Tenant approves any such change order, Landlord, at its election, may either (i) require as a condition to the effectiveness of such change order that Tenant pay the increase in the cost attributable to such change order concurrently with delivery of Tenant’s approval of the change order, or (ii) defer Tenant’s payment of such increase until the date 10 business days after delivery of invoices for same, provided however, that the increase in cost must in any event be paid in full prior to Tenant’s commencing occupancy of the Premises. If Tenant disapproves any such change order, Tenant shall nonetheless be responsible for the reasonable architectural and/or planning fees incurred in preparing such change order. Landlord shall have no obligation to interrupt or modify the Tenant Improvement Work pending Tenant’s approval of a change order, but if Tenant fails to timely approve a change order, Landlord may (but shall not be required to) suspend the applicable Tenant Improvement Work, in which event any related critical path delays because of such suspension shall constitute Tenant Delays hereunder.

C. Landlord agrees that it shall not unreasonably withhold its consent to Tenant’s requested Changes, provided that such consent may be withheld in all events if the requested Change (i) is of a lesser quality than the Tenant Improvements previously approved by Landlord, (ii) fails to conform to applicable governmental requirements, (iii) would result in the Premises requiring building services beyond the level Landlord has agreed to provide Tenant under the Lease, (iv) would delay construction of the Tenant Improvements and Tenant declines to accept such delay in writing as a Tenant Delay, (v)

1.

interferes in any manner with the proper functioning of, or Landlord’s access to, any mechanical, electrical, plumbing or HVAC systems, facilities or equipment in or serving the Building, or (vi) would have an adverse aesthetic impact to the Premises or would cause additional expenses to Landlord in reletting the Premises.

D. Notwithstanding any provision in the Lease to the contrary, and not by way of limitation of any other rights or remedies of Landlord, if Tenant fails to comply with any of the time periods specified in this Work Letter, fails otherwise to approve or reasonably disapprove any submittal within the time period specified herein for such response (or if no time period is so Specified, within 5 business days following Tenant’s receipt thereof), requests any Changes, furnishes inaccurate or erroneous specifications or other information, or otherwise delays in any manner the completion of the Tenant Improvements (including without limitation by specifying materials that are not readily available) or the issuance of an occupancy certificate (any of the foregoing being referred to in this Lease as a “Tenant Delay”), then Tenant shall bear any resulting additional construction cost or other expenses, and the Commencement Date of this Lease shall be deemed to have occurred for all purposes, including without limitation Tenant’s obligation to pay rent, as of the date Landlord reasonably determines that it would have been able to deliver the Premises to Tenant but for the collective Tenant Delays. Should Landlord determine that the Commencement Date should be advanced in accordance with the foregoing, it shall so notify Tenant in writing. Landlord’s determination shall be conclusive unless Tenant notifies Landlord in writing, within 5 business days thereafter, of Tenant’s election to contest same. Pending the outcome of such contest, Tenant shall make timely payment of all rent due under this Lease based upon the Commencement Date set forth in the aforesaid notice from Landlord.

E. All Standard Tenant Improvements and Non-Standard Improvements shall become the property of Landlord and shall be surrendered with the Premises at the end of the Term.

F. Landlord shall permit Tenant and its agents to enter the Premises prior to the Commencement Date of the Lease in order that Tenant may install fixtures, furniture and cabling through Tenant’s own contractors prior to the Commencement Date. Any such work shall be subject to Landlord’s prior written approval, and shall be performed in a manner and upon terms and conditions and at times satisfactory to Landlord’s representative. The foregoing license to enter the Premises prior to the Commencement Date is, however, conditioned upon Tenant’s contractors and their subcontractors and employees working in harmony and not interfering with the work being performed by Landlord. If at any time that entry shall cause disharmony or interfere with the work being performed by Landlord, this license may be withdrawn by Landlord upon 24 hours written notice to Tenant. That license is further conditioned upon the compliance by Tenant’s contractors with all requirements imposed by Landlord on third party contractors, including without limitation the maintenance by Tenant and its contractors and subcontractors of workers’ compensation and public liability and property damage insurance in amounts and with companies and on forms satisfactory to Landlord, with certificates of such insurance being furnished to Landlord prior to proceeding with any such entry. The entry shall be deemed to be under all of the provisions of the Lease except as to the covenants to pay rent. Landlord shall not be liable in any way for any personal injury, and/or loss or damage of property which may occur in connection with such entry by Tenant or in connection with such work being performed by Tenant, the same being solely at Tenant’s risk. In no event shall the failure of Tenant’s contractors to complete any work in the Premises extend the Commencement Date of this Lease.

G. Tenant hereby designates Leo Kao (Tenant’s Construction Representative”), Telephone No. (408) 855-3022. Email: LKao@easic.com, as its representative, agent and attorney-in-fact for all matters related to the Tenant Improvement Work, including but not by way of limitation. for purposes of receiving notices, approving submittals and issuing requests for Changes, and Landlord shall be entitled to rely upon authorizations and directives of such person(s) as if given directly by Tenant. The foregoing authorization is intended to provide assurance to Landlord that it may rely upon the directives and decision making of the Tenant’s Construction Representative with respect to the Tenant Improvement Work and is not intended to limit or reduce Landlord’s right to reasonably rely upon any decisions or directives given by other officers or representatives of Tenant. Any notices or submittals to, or requests of, Tenant related to this Work Letter and/or the Tenant Improvement Work may be sent to Tenant’s Construction Representative at the email address above provided. Tenant may amend the designation of its Tenant’s Construction Representative(s) at any time upon delivery of written notice to Landlord.

2.

SCHEDULE 1

1.

EXHIBIT Y

PROJECT DESCRIPTION

1.

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the use in this Amendment No. 7 to Registration Statement No. 333-202186 on Form S-1 of our report dated February 19, 2015 relating to the consolidated financial statements of eASIC Corporation and its subsidiaries appearing in the Prospectus, which is part of this Registration Statement.

We also consent to the reference to us under the heading “Experts” in such Prospectus.

/s/ DELOITTE & TOUCHE LLP

San Jose, California

August 10, 2015