Tempo Automation Holdings, Inc. Receives a Default Notice From its Senior Lender Consortium

SAN FRANCISCO, Sept. 21, 2023 (GLOBE NEWSWIRE) -- Tempo Automation Holdings, Inc. (NASDAQ: TMPO, the “Company”) has received a default notice from its senior lender consortium.  As previously disclosed, Tempo Automation, Inc. (“Tempo OpCo”), a Delaware corporation and wholly owned subsidiary of the Company, previously entered into that certain First Amended and Restated Loan and Security Agreement, dated as of November 22, 2022 (as amended, the “Loan Agreement”) by and among Tempo OpCo, Structural Capital Investments III, LP (“SCI”), Series Structural DCO II series of Structural Capital DCO, LLC (“DCO”), CEOF Holdings LP (“CEOF”), SQN Tempo Automation, LLC (“SQNTA”), SQN Venture Income Fund II, LP (“SQNVIFII” and, together with SCI, DCO, CEOF and SQNTA, the “Lenders”), and Ocean II PLO LLC, as administrative and collateral agent for the Lenders (the “Agent”), and that certain Forbearance Agreement and First Amendment to First Amended and Restated Loan and Security Agreement, dated as of June 20, 2023 (the “Forbearance”), by and among the Company, Tempo OpCo, the Lenders, and the Agent. The Loan Agreement is secured by the assets of Tempo OpCo and its subsidiaries (the “Collateral”), and the Company is a party to the Loan Agreement and has guaranteed Tempo OpCo’s obligations thereunder. The Loan Agreement and Forbearance were attached as exhibits to the Company’s Current Reports on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on December 6, 2022 and June 21, 2023, respectively.

On September 15, 2023, Tempo OpCo received a notice from the Agent stating that Tempo OpCo had breached the Loan Documents (as defined in the Loan Agreement) and that an event of default under the Loan Agreement had occurred as a result of, among other things, (i) Tempo OpCo’s failure to make the monthly payments due for July 2023 and each month thereafter, (ii) the occurrence of a Material Adverse Effect (as defined in the Loan Agreement), (iii) Ryan Benton ceasing to serve as Tempo OpCo’s Chief Financial Officer and (iv) Tempo OpCo suspending its business operations. As a result of such events of default, the Agent declared all amounts owed under the Loan Documents to be in default and demanded that Tempo OpCo immediately pay such amounts, including, but not limited to, the entire indebtedness under the Loan Agreement, plus accruing interest, late charges and fees and any costs incurred by the Lenders. Additionally, as a result of such events of default, the Lenders terminated any and all commitments and obligations of the Lenders under the Loan Documents, including without limitation, any obligation for the Lenders to lend money or make other loan funds available to or for the benefit of Tempo OpCo.