Exhibit 10.1

CREDIT AGREEMENT

This Credit Agreement dated as of November 27, 2017 (as supplemented, amended,
modified, amended and restated or replaced in writing from time to time, this
“Agreement”), is entered into by and between BOX, INC., a Delaware corporation
(the “Borrower”), and WELLS FARGO BANK, NATIONAL ASSOCIATION (the “Lender”).

RECITALS

WHEREAS, the Borrower has requested that the Lender make available loans and
other financial accommodations to the Borrower; and

WHEREAS, the Lender has agreed to make available such loans and other financial
accommodations on the terms and subject to the conditions set forth herein;

NOW THEREFORE, in consideration of the mutual agreements contained herein, the
parties hereto agree as follows:

ARTICLE I.

DEFINITIONS

Section 1.01 Defined Terms. As used in this Agreement, the following terms have
the following meanings:

“Accounts Receivable”: All accounts (as that term is defined in the UCC).

“Affiliate”: As applied to any Person, any other Person directly or indirectly
controlling, controlled by, or under common control with, that Person. For the
purposes of this definition, “control” (including, with correlative meanings,
the terms “controlling”, “controlled by” and “under common control with”), as
applied to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of that
Person, whether through the ownership of voting securities or by contract or
otherwise.

“Agreement”: As defined in the introductory paragraph of this Agreement.

“Applicable Margin”: For any day, (i) 0.25% in the case of Prime Rate Loans and
(ii) 1.00% in the case of LIBOR Loans.

“Applicable Reserve Requirement”: At any time, for any Loan, the maximum rate,
expressed as a decimal, at which reserves are required to be maintained with
respect thereto against “Eurocurrency liabilities” (as such term is defined in
Regulation D of the Board) under regulations issued from time to time by the
Board or other applicable banking regulator. Without limiting the effect of the
foregoing, the Applicable Reserve Requirement shall reflect any other reserve
required by the Board to be maintained by such member banks with respect to
(i) any category of liabilities which includes deposits by reference to which
the applicable LIBOR or any other interest rate of a Loan is determined or
(ii) any category of extensions of credit or other assets which include Loans. A
Loan shall be deemed to constitute Eurocurrency liabilities and as such shall be
deemed subject to reserve requirements without benefits of credit for proration,
exceptions or offers that may be available from time to time to the Lender. The
rate of interest on LIBOR Loans shall be adjusted automatically on and as of the
effective date of any change in the Applicable Reserve Requirement.

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“Average Deferred Revenue Change”: The average Deferred Revenue Change
calculated based upon each of the four Fiscal Quarters in any trailing twelve
month period.

“Bankruptcy Code”: Title 11 of the United States Code entitled “Bankruptcy”, as
now and hereafter in effect, or any successor statute.

“Board”: The Board of Governors of the Federal Reserve System and any successor
thereto.

“Borrower”: As defined in the introductory paragraph of this Agreement.

“Borrowing”: As defined in Section 2.01(b).

“Business Day”: A day other than a Saturday, Sunday or a day on which commercial
banks in California are authorized or required by law to close.

“Capital Expenditures”: As to any Person, expenditures (including expenditures
with respect to Capital Leases) made by such Person to acquire or construct
fixed assets, plants and equipment (including renewals, improvements and
replacements, but excluding repairs unless such repairs are required to be
capitalized in accordance with GAAP).

“Capital Lease”: As applied to any Person, any lease of any property (whether
real, personal or mixed) by that Person as lessee that, in conformity with GAAP,
is accounted for as a capital lease on the balance sheet of that Person.

“Cash Collateralize”: To pledge and deposit with or deliver to the Lender, as
collateral, an amount (whether in cash or deposit account balances or in the
form of a standby letter of credit in form and substance reasonably satisfactory
to, and issued by a United States commercial bank reasonably acceptable to, the
Lender in its commercially reasonable discretion) pursuant to documentation in
form and substance reasonably satisfactory to the Lender. “Cash Collateral”
shall have a meaning correlative to the foregoing and shall include the proceeds
of such cash collateral and other credit support.

“Cash Equivalents”:

(i) Direct obligations of, or obligations the principal of and interest on which
are unconditionally guaranteed by, the United States of America (or by any
agency thereof to the extent such obligations are backed by the full faith and
credit of the United States of America), in each case maturing within one year
from the date of issuance thereof;

(ii) investments in commercial paper maturing within 270 days from the date of
issuance thereof and having, at such date of acquisition, a rating of at least
“Prime 1” (or the then equivalent grade) by Moody’s or “A-1” (or the then
equivalent grade) by S&P;

(iii) investments in certificates of deposit, banker’s acceptances and time
deposits maturing within one year from the date of acquisition thereof issued or
guaranteed by or placed with, and money market deposit accounts issued or
offered by, the Lender or any domestic office of any commercial bank organized
under the laws of the United States of America or any State thereof that has a
combined capital and surplus and undivided profits of not less than $500,000,000
and that issues (or the parent of which issues) commercial paper rated at least
“Prime 1” (or the then equivalent grade) by Moody’s or “A-1” (or the then
equivalent grade) by S&P;

 

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(iv) fully collateralized repurchase agreements with a term of not more than 30
days for securities described in clause (i) above and entered into with a
financial institution satisfying the criteria of clause (iii) above;

(v) investments in “money market funds” within the meaning of Rule 2a-7 of the
Investment Company Act of 1940, as amended, substantially all of whose assets
are invested in investments of the type described in clauses (i) through (iv)
above;

(vi) other short-term investments utilized by Foreign Subsidiaries in accordance
with normal investment practices for cash management in investments of a type
analogous to the foregoing; and

(vii) investments described on Schedule 1.01(a)(i) to the Disclosure Letter and
other investments approved by the Lender.

“Cash Management Obligations”: With respect to any Person, all liabilities of
such Person under any agreement to provide cash management services, including
treasury, depositary, overdraft, credit or debit card, electronic funds transfer
and other cash management agreements.

“CFC”: A controlled foreign corporation within the meaning of Section 957(a) of
the Internal Revenue Code.

“Change in Control”: Shall be deemed to have occurred if (i) any “person” or
“group” (within the meaning of Rule 13d-5 of the Securities Exchange Act of
1934, as in effect on the date hereof), other than the Permitted Investors,
shall own, directly or indirectly, beneficially or of record, shares
representing more than 35% of the aggregate ordinary voting power represented by
the issued and outstanding Equity Interests of the Borrower, or (ii) any change
in control (or similar event, however denominated) with respect to the Borrower
or any Subsidiary shall occur under and as defined in any indenture or agreement
in respect of any Debt in an aggregate principal amount exceeding $5,000,000 to
which the Borrower or any Subsidiary is a party.

“Change in Law”: The occurrence, after the date of this Agreement, of any of the
following: (i) the adoption or taking effect of any law, rule, regulation or
treaty, (ii) any change in any law, rule, regulation or treaty or in the
administration, interpretation, implementation or application thereof by any
governmental authority, central bank or comparable entity charged with the
interpretation or administration thereof, or (iii) the making or issuance of any
request, rule, guideline or directive (whether or not having the force of law)
by any governmental authority, central bank or comparable entity charged with
the interpretation or administration thereof; provided that notwithstanding
anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and
Consumer Protection Act and all requests, rules, guidelines or directives
thereunder or issued in connection therewith and (y) all requests, rules,
guidelines or directives promulgated by the Bank for International Settlements,
the Basel Committee on Banking Supervision (or any successor or similar
authority) or the United States or foreign regulatory authorities, in each case
pursuant to Basel III, shall in each case be deemed to be a “Change in Law”,
regardless of the date enacted, adopted or issued.

“Chief Financial Officer”: The chief financial officer (or equivalent Person) of
Borrower.

 

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“Closing Date”: The date on which all conditions precedent set forth in
Section 4.01 have been satisfied or waived by the Lender.

“Collateral”: The collective reference to the “Collateral” as defined in the
Security Agreement and any other collateral pledged to the Lender pursuant to a
Loan Document.

“Commitment”: The commitment of the Lender to make Loans to the Borrower
pursuant to Section 2.01(a). The amount of the Lender’s Commitment as of the
Closing Date is $85,000,000.

“Commodity Exchange Act”: The Commodity Exchange Act (7 U.S.C. § 1 et seq.), as
amended from time to time, and any successor statute.

“Compliance Certificate”: A certificate substantially in the form of Exhibit B
hereto.

“Connection Income Taxes”: Other Connection Taxes that are imposed on or
measured by net income (however denominated) or that are franchise Taxes or
branch profits Taxes.

“Consolidated Net Income (or Deficit)”: The consolidated net income (or deficit)
of any Person and its Subsidiaries, after deduction of all expenses, taxes, and
other proper charges, determined in accordance with GAAP, after eliminating
therefrom all extraordinary or nonrecurring items of income.

“Consolidated Total Interest Expense”: With respect to any Person for any
period, the aggregate amount of interest required to be paid or accrued by a
Person and its Subsidiaries during such period on all indebtedness of such
Person and its Subsidiaries outstanding during all or any part of such period,
whether such interest was or is required to be reflected as an item of expense
or capitalized, including payments consisting of interest in respect of any
capitalized lease or any synthetic lease, and including commitment fees, agency
fees, facility fees, balance deficiency fees and similar fees or expenses in
connection with the borrowing of money.

“Cost Sharing Agreement”: Cost Sharing Agreement dated as of June 25, 2013
between Borrower and Box Intl Technology Ltd., as amended on October 15, 2015,
as may be amended from time to time.

“Debt”: As applied to any Person, without duplication, (i) all indebtedness for
borrowed money and all obligations evidenced by bonds, debentures, notes, loan
agreements or other similar instruments, (ii) that portion of obligations with
respect to Capital Leases which is properly classified as a liability on a
balance sheet in conformity with GAAP, (iii) notes payable representing
extensions of credit whether or not representing obligations for borrowed money,
(iv) any obligation owed for all or any part of the deferred purchase price of
property or services (excluding (a) trade accounts payable incurred in the
ordinary course of business not more than ninety (90) days past due, or that are
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided for on the
books of such Person, (b) earnout payments (other than, for the avoidance of
doubt, earnout payments payable solely in Qualified Equity Interests of the
Borrower) , (c) any accruals for payroll and other non-interest bearing
liabilities accrued in the ordinary course of business and (d) any obligations
in respect of operating leases) which purchase price is (y) due more than six
months from the date of incurrence of the obligation in respect thereof or
(z) evidenced by a note or similar written instrument, (v) all indebtedness for
borrowed money secured by any Lien on any property owned or held by that Person
regardless of whether the indebtedness for borrowed money secured thereby shall
have been assumed by that Person or is nonrecourse to the credit of that Person
(excluding any obligations in respect of operating leases), (vi) all
obligations, contingent or otherwise, with respect to the face amount of all
letters of credit (whether drawn or undrawn), bankers’ acceptances or similar

 

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obligations issued for the account of such Person, (vii) all swap and related
hedging arrangements (including the Hedging Obligations) of such Person valued
at the net termination value thereof, (viii) all obligations of such person in
respect of Disqualified Equity Interests, and (ix) any Guaranty of such Person
in respect of any Debt of any other Person described in clauses (i) through
(viii) above.

“Deferred Revenue”: All amounts received or invoiced in advance of performance
under contracts and not yet recognized as revenue, as determined in accordance
with GAAP.

“Deferred Revenue Change”: Any change in Deferred Revenue as of the last day of
a Fiscal Quarter as compared to Deferred Revenue for the last day of the same
Fiscal Quarter in the prior Fiscal Year.

“Disclosure Letter”: That certain disclosure letter dated as of the date hereof
delivered by the Borrower to the Lender, as may be updated from time to time in
accordance with the terms of this Agreement and the other Loan Documents.

“Disposition”: As defined in Section 6.02(f).

“Disqualified Equity Interests”: Any Equity Interests that, by their terms (or
by the terms of any security or other Equity Interest into which they are
convertible or for which they are exchangeable) or upon the happening of any
event or condition, (i) mature or are mandatorily redeemable (other than solely
for Qualified Equity Interests), pursuant to a sinking fund obligation or
otherwise (except as a result of a change of control or asset sale so long as
any rights of the holders thereof upon the occurrence of a change of control or
asset sale event shall be subject to the prior repayment in full of the Loans
and all other Obligations that are accrued and payable and the termination of
the Commitment), (ii) are redeemable at the option of the holder thereof (other
than solely for Qualified Equity Interests) (except as a result of a change of
control or asset sale so long as any rights of the holders thereof upon the
occurrence of a change of control or asset sale event shall be subject to the
prior repayment in full of the Loans and all other Obligations that are accrued
and payable and the termination of the Commitment), in whole or in part,
(iii) provide for the scheduled payment of dividends in cash or (iv) are or
become convertible into or exchangeable for Debt or any other Equity Interests
that would constitute Disqualified Equity Interests, in each case, prior to the
date that is 91 days after the Maturity Date; provided that if such Equity
Interests are issued pursuant to a plan for the benefit of Borrower or its
Subsidiaries or by any such plan to their respective employees or independent
contractors, such Equity Interests shall not constitute Disqualified Equity
Interests solely because they may be required to be repurchased by Borrower or
its Subsidiaries in order to satisfy applicable statutory or regulatory
obligations.

“Dollars” and “$”: The lawful currency of the United States of America.

“Domestic Subsidiary”: Each Subsidiary that is organized under the laws of the
United States, any state, territory, protectorate or commonwealth thereof or the
District of Columbia.

“EBITDA”: With respect to any period an amount equal to the sum of
(a) Consolidated Net Income of the Borrower and its Subsidiaries for such
period, plus (b) in each case to the extent deducted in the calculation of the
Borrower’s Consolidated Net Income and without duplication, (i) depreciation and
amortization for such period, plus (ii) provision (benefit) for income tax for
such period, plus (iii) Consolidated Total Interest Expense paid or accrued
during such period, plus (iv) non-cash expenses, losses and charges, including,
without limitation, non-cash compensation-based expenses, plus (v) all
extraordinary, unusual or non-recurring expenses, losses and charges for such
period, including , without limitation, restructuring charges, including,
without limitations, costs, fees and expenses incurred by Borrower or its
Subsidiaries in connection with any Permitted Acquisition, plus (vi) any other
expenses, losses or charges agreed to by the Lender, plus or minus (c) the
Average Deferred Revenue Change, all as determined in accordance with GAAP.

 

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“Eligible Accounts Receivable”: Bona fide trade Accounts Receivable created in
the ordinary course of the Borrower’s consolidated business, evidenced by an
invoice rendered to the account debtor, upon which the Borrower’s (on a
consolidated basis) right to receive payment is absolute and not contingent upon
the fulfillment of any condition whatsoever (other than with respect to prepaid
subscription fees received by the Borrower (on a consolidated basis), which fees
shall be deemed to be Eligible Accounts Receivable to the extent that the
corresponding customer agreements pursuant to which such fees arise and the
Borrower (on a consolidated basis) renders services remain in full force and
effect and no notice of termination has been given under such agreements), and
in which the Lender has a perfected security interest of first priority, and in
each case, classified as a “current asset” in accordance with GAAP, and shall
not include any Account Receivable that has been outstanding more than 60 days
past due.

“Environmental Laws”: Any and all current or future statutes, ordinances,
orders, rules, regulations, guidance documents, judgments, governmental
authorizations, or any other requirements of governmental authorities relating
to (i) environmental matters or (ii) occupational safety and health, industrial
hygiene, land use or the protection of human, plant or animal health or welfare,
in any manner applicable to any Loan Party or any of its Subsidiaries.

“Environmental Permit”: Any permit, approval, identification number, license or
other authorization required under any Environmental Law.

“Equity Interests”: (i) All shares of capital stock (whether denominated as
common stock or preferred stock), equity interests, beneficial, partnership or
membership interests, joint venture interests, participations or other ownership
or profit interests in or equivalents (regardless of how designated) of or in a
Person (other than an individual), whether voting or non-voting, and (ii) all
securities convertible into or exchangeable for any of the foregoing and all
warrants, options or other rights to purchase, subscribe for or otherwise
acquire any of the foregoing, whether or not presently convertible, exchangeable
or exercisable.

“ERISA”: The Employee Retirement Income Security Act of 1974, as amended from
time to time, and any successor statute.

“Event of Default”: As defined in Section 7.01.

“Excluded Taxes”: Any of the following Taxes imposed on or with respect to the
Lender or required to be withheld or deducted from a payment to the Lender
(i) Taxes imposed on or measured by net income (however denominated), franchise
Taxes, and branch profits Taxes, in each case, (a) imposed as a result of the
Lender being organized under the laws of, or having its principal office or its
applicable lending office located in, the jurisdiction imposing such Tax (or any
political subdivision thereof) or (b) that are Other Connection Taxes,
(ii) Federal withholding Taxes imposed on amounts payable to or for the account
of the Lender with respect to an applicable interest in a Loan or Commitment
pursuant to a law in effect on the date on which (a) the Lender acquires such
interest in the Loan or Commitment or (b) the Lender changes its lending office,
except in each case to the extent that, pursuant to Section 3.11, amounts with
respect to such Taxes were payable either to the Lender’s assignor immediately
before the Lender became a party hereto or to the Lender immediately before it
changed its lending office, (iii) Taxes attributable to such recipient’s failure
to comply with Section 3.11(f), and (iv) any Federal withholding Taxes under
FATCA.

 

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“Excluded Swap Obligation”: With respect to any Guarantor, any Swap Obligation
if, and to the extent that, all or a portion of the guaranty of such Guarantor
of, or the grant by such Guarantor of a security interest to secure, such Swap
Obligation (or any guaranty thereof) is or becomes illegal under the Commodity
Exchange Act or any rule, regulation or order of the Commodity Futures Trading
Commission (or the application or official interpretation of any thereof) by
virtue of such Guarantor’s failure for any reason to constitute an “eligible
contract participant” as defined in the Commodity Exchange Act and the
regulations thereunder at the time the guaranty of such Guarantor or the grant
of such security interest becomes effective with respect to such Swap
Obligation. If a Swap Obligation arises under a master agreement governing more
than one swap, such exclusion shall apply only to the portion of such Swap
Obligation that is attributable to swaps for which such guaranty or security
interest is or becomes illegal.

“Existing Credit Agreement”: The Credit Agreement dated as of December 4, 2015
among the Borrower, the Existing Lender, as administrative agent, collateral
agent and lender, and the other lenders party thereto (as amended, supplemented
or otherwise modified from time to time).

“Existing Lender”: HSBC Bank USA, National Association, a national banking
association.

“FATCA”: Sections 1471 through 1474 of the Internal Revenue Code, as of the date
of this Agreement (or any amended or successor version that is substantively
comparable and not materially more onerous to comply with), any current or
future regulations or official interpretations thereof and any agreements
entered into pursuant to Section 1471(b)(1) of the Internal Revenue Code.

“FCPA”: As defined in Section 5.01(y).

“Fiscal Quarter”: A fiscal quarter of any Fiscal Year.

“Fiscal Year”: The fiscal year of the Borrower ending on January 31 of each
year.

“Foreign Subsidiary”: Any Subsidiary that is organized under the laws of any
jurisdiction other than the United States, any state, territory, protectorate or
commonwealth thereof or the District of Columbia.

“GAAP”: Generally accepted accounting principles, standards and practices in the
United States, applied on a consistent basis.

“Grantor”: As defined in the Security Agreement.

“Guarantor”: Each Domestic Subsidiary (other than a Domestic Subsidiary of a
Foreign Subsidiary that is a CFC) that is a Material Subsidiary (or, at the
election of the Borrower, any other Subsidiary) that is or becomes a party to a
Subsidiary Guarantee.

“Guaranty”: As to any Person, (i) any obligation, contingent or otherwise, of
such Person guaranteeing or having the economic effect of guaranteeing any Debt
or other obligation payable or performable by another Person (the “primary
obligor”) in any manner, whether directly or indirectly, and including any
obligation of such Person, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt or other
obligation, (b) to purchase or lease property, securities or services for the
purpose of assuring the obligee in respect of such Debt or other obligation of
the payment or performance of such Debt or other obligation, (c) to maintain
working capital, equity capital or any other financial statement or condition or
liquidity or level of income or cash flow of the

 

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primary obligor so as to enable the primary obligor to pay such Debt or other
obligation, or (d) entered into for the purpose of assuring in any other manner
the obligee in respect of such Debt or other obligation of the payment or
performance thereof or to protect such obligee against loss in respect thereof
(in whole or in part), or (ii) any Lien on any assets of such Person securing
Debt or other obligation of any other Person, whether or not such Debt or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Debt to obtain any such Lien). The amount of any Guaranty
shall be deemed to be an amount equal to the stated or determinable amount of
the related primary obligation, or portion thereof, in respect of which such
Guaranty is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof as determined by the guaranteeing
Person in good faith. Notwithstanding anything herein to the contrary, the term
“Guaranty” shall not include endorsements for collection or deposit, in either
case in the ordinary course of business, or customary and reasonable indemnity
obligations (A) in effect on the Closing Date, (B) entered into in connection
with any acquisition or disposition of assets permitted under this Agreement
(other than such obligations with respect to Debt), or (C) set forth in customer
or vendor agreements entered into by the Borrower or any Subsidiary in the
ordinary course of business consistent with past practices (other than such
obligations with respect to Debt).

“Hazardous Materials”: All chemicals, materials, substances, wastes, pollutants,
contaminants, compounds, in any form, including petroleum or petroleum
distillates, asbestos or asbestos-containing materials, polychlorinated
biphenyls, radon gas or mold, subject to regulation under or which give rise to
liability pursuant to any Environmental Law.

“Hedge Agreement”: (i) Any and all agreements in respect of rate swaps, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap or floor transactions,
collar transactions, currency-swaps, cross-currency rate swaps, currency
options, spot contracts or any similar transactions or any combinations of the
foregoing (including any options to enter into any of the foregoing), whether or
not any such transactions is governed by or subject to any master agreement, and
(ii) any and all agreements which are governed by, or subject to the terms and
conditions of, any form of master agreement published by the International Swaps
and Derivatives Association, Inc., any International Foreign Exchange Master
Agreement or any other master agreement. For the avoidance of doubt, the
following shall not be deemed a “Hedge Agreement”: (a) any agreement related to
incentive stock, restricted stock, restricted stock units, stock options,
phantom stock or similar agreements entered into with current or former
directors, officers, employees or consultants of the Borrower, (b) any stock
option or warrant agreement for the purchase of Equity Interests of the
Borrower, (c) the purchase of Equity Interests of Borrower pursuant to delayed
delivery contracts or other similar agreements.

“Hedging Obligations”: With respect to any Person, all net liabilities of such
Person under any Hedge Agreement.

“Indemnified Liabilities”: As defined in Section 8.06.

“Indemnified Parties”: As defined in Section 8.06.

“Indemnified Taxes”: (i) Taxes, other than Excluded Taxes, imposed on or with
respect to any payment made by or on account of any obligation of the Borrower
under any Loan Document and (ii) to the extent not otherwise described in the
preceding clause (i), Other Taxes.

 

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“Interest Payment Date”: As to any LIBOR Loan with an Interest Period of three
months or less, the last day of such Interest Period and the Maturity Date; and
as to any LIBOR Loan with an Interest Period in excess of three months, (i) each
day prior to the last day of such Interest Period that occurs at intervals of
three months following the beginning of such Interest Period, (ii) the last day
of such Interest Period and (iii) the Maturity Date; and as to any Prime Rate
Loan, the last day of each calendar quarter, commencing on the first such date
to occur after such Prime Rate Loan is made, and the Maturity Date.

“Interest Period”: With respect to any LIBOR Loan:

(i) initially, the period commencing on, as the case may be, the Borrowing date
with respect to such LIBOR Loan and ending one, three or six months thereafter
as selected by the Borrower in its notice of Borrowing as provided in
Section 2.01(b); and

(ii) thereafter, each period commencing on (a) in the case of a continuation of
a LIBOR Loan, the last day of the next preceding Interest Period applicable to
such LIBOR Loan and (b) in the case of a conversion to a LIBOR Loan, the
effective date of such conversion, and in each case, ending one, three or six
months thereafter as selected by the Borrower in its notice of continuation or
conversion as provided in Section 2.04;

provided that all of the foregoing provisions relating to Interest Periods are
subject to the following:

(a) if any Interest Period for a LIBOR Loan would otherwise end on a day which
is not a LIBOR Business Day, that Interest Period shall be extended to the next
succeeding LIBOR Business Day unless the result of such extension would be to
carry such Interest Period into another calendar month in which event such
Interest Period shall end on the immediately preceding LIBOR Business Day;

(b) if any Interest Period for a LIBOR Loan begins on the last LIBOR Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period) that
Interest Period shall, subject to clause (c), end on the last LIBOR Business Day
of the relevant calendar month at the end of such Interest Period;

(c) Borrower may not select an Interest Period with respect to any portion of
principal of a LIBOR Loan which extends beyond the Maturity Date; and

(d) there shall be no more than three (3) Interest Periods with respect to LIBOR
Loans outstanding at any time.

“Internal Revenue Code”: The Internal Revenue Code of 1986, as amended to the
date hereof and from time to time hereafter, including any regulations of the
U.S. Department of the Treasury.

“Landlord Subordination Agreement”: A landlord subordination agreement in form
and substance reasonably satisfactory to the Lender, executed by a landlord of
any leased real property.

“Lender”: As defined in the introductory paragraph of this Agreement.

“Letter of Credit Sublimit”: A sublimit for Letters of Credit not to exceed
$30,000,000.

“Leverage Ratio”: The ratio of (i) without duplication, all outstanding Debt
owed under the Commitment, the Letter of Credit Sublimit and that constitutes
Capital Leases, to (ii) EBITDA, measured on a trailing twelve month basis and
determined on a consolidated basis in accordance with GAAP.

 

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“LIBOR”: With respect to any LIBOR Loan, the London interbank offered rate
administered and published by ICE Benchmark Administration Limited (or any other
successor thereto which takes over administration of such rate), as determined
by the Lender from time to time for purposes of providing quotations of interest
rate applicable to Dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two (2) LIBOR Business Days prior to the
making of such LIBOR Loan, as the rate of the offering of Dollar deposits with a
maturity comparable to the Interest Period of such LIBOR Loan, in each case as
adjusted for Applicable Reserve Requirements; provided, that if LIBOR is less
than zero, LIBOR shall be deemed to be zero.

“LIBOR Business Day”: A day which is a Business Day and on which dealings in
Dollar deposits may be carried out in the London interbank market.

“LIBOR Loans”: Loans hereunder at such time as they accrue interest at a rate
based upon LIBOR.

“Lien”: Any lien, mortgage, deed of trust, pledge, security interest, charge or
encumbrance of any kind (including any conditional sale or other title retention
agreement, any financing lease in the nature thereof, and any agreement to give
any security interest).

“Liquidity”: At any time of determination, the sum of (i) the amount (without
duplication) of Eligible Accounts Receivable at such time and (ii) the amount of
Unrestricted Cash at such time.

“Loans”: All advances made to the Borrower pursuant to Section 2.01.

“Loan Documents”: This Agreement, the Note, the Security Documents, the
Subsidiary Guarantee, and each other agreement or certificate delivered to the
Lender in connection with this Agreement and/or the credit extended hereunder
(but excluding any Hedge Agreement with the Lender or its Affiliates or any
agreements relating to Cash Management Obligations owing to the Lender or its
Affiliates).

“Loan Party”: The Borrower and the Guarantors.

“Management and Services Agreement”: Management and Services Agreement dated as
of August 26, 2013 between Borrower and Box.com (UK) Ltd, as may be amended from
time to time.

“Material Adverse Effect”: (i) A material adverse change in, or a material
adverse effect upon, the business, general affairs, assets, liabilities,
properties, operations, financial condition or results of operations of the Loan
Parties, taken as a whole, (ii) (a) a material impairment of the ability of any
Loan Party to comply with or perform any of its payment obligations under any
Loan Document or (b) a material impairment of the ability of any Loan Party to
comply with or perform any of its other obligations under any Loan Document or
(iii) a material adverse effect upon the legality, validity, binding effect or
enforceability against any Loan Party of any Loan Document.

“Material Subsidiary”: Any Subsidiary that, on a consolidated basis for such
Subsidiary and its Subsidiaries, (i) for the most recent Fiscal Quarter for
which financial statements have been delivered or required to be delivered
pursuant to Section 6.01(a)(i) or (ii) accounted for more than 10% of the
consolidated revenues of the Borrower and its Subsidiaries or (ii) as at the end
of such Fiscal Quarter, was the owner of more than 10% of the consolidated
assets of the Borrower and its Subsidiaries.

 

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“Maturity Date”: November 27, 2020.

“Moody’s”: Moody’s Investors Service, Inc., or any successor thereto.

“Multiemployer Plan”: A “multiemployer plan” as defined in Section 3(37) of
ERISA.

“Non-U.S. Lender Party”: As defined in Section 3.11(f)(ii)(B).

“Note”: A promissory note in the form of Exhibit C, as supplemented, amended,
modified, amended and restated or replaced in writing from time to time.

“Obligations”: All advances to, debts, liabilities, obligations (monetary
(including post-petition interest, allowed or not) or otherwise) of every nature
of any Loan Party from time to time arising under any Loan Document or otherwise
with respect to any Loan, in each case, whether direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter arising, and
including principal, interest, fees, expenses and indemnification obligations.

“OFAC”: The Office of Foreign Assets Control, Department of the Treasury.

“Other Connection Taxes”: With respect to any recipient (including the Lender),
Taxes imposed as a result of a present or former connection between such
recipient (including the Lender) and the jurisdiction imposing such Tax (other
than connections arising from such recipient (including the Lender) having
executed, delivered, become a party to, performed its obligations under,
received payments under, received or perfected a security interest under,
engaged in any other transaction pursuant to or enforced any Loan Document, or
sold or assigned an interest in any Loan or Loan Document).

“Other Taxes”: All present or future stamp, court or documentary, intangible,
recording, filing or similar Taxes that arise from any payment made under, from
the execution, delivery, performance, enforcement or registration of, from the
receipt or perfection of a security interest under, or otherwise with respect
to, any Loan Document, except any such Taxes that are Other Connection Taxes
imposed with respect to an assignment.

“Patriot Act”: The USA Patriot Act (Title III of Pub. L. 107-56), as amended.

“Pension Plan”: Any employee benefit plan as defined in Section 3(3) of ERISA,
other than a Multiemployer Plan, which is subject to Section 412 of the Internal
Revenue Code or Section 302 of ERISA.

“Permitted Acquisition”: Any acquisition by the Borrower or any of its
Subsidiaries of all or substantially all of the stock, assets or any business
line or division of a U.S. or foreign Person, whether by merger, consolidation
or otherwise, in any transaction or a series of related transactions, provided
that:

(i) no less than one (1) day prior to the proposed closing date of such
acquisition, the Borrower shall have delivered written notice of such Permitted
Acquisition to the Lender, which notice shall include the proposed closing date
of such Permitted Acquisition;

 

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(ii) for any acquisition in which the aggregate amount of consideration exceeds
$10,000,000, the Borrower shall have furnished to the Lender at least one
(1) day prior to the consummation thereof copies of such agreements, instruments
and other documents as the Lender shall reasonably request, including any term
sheet and/or commitment letter and other documents in connection with such
acquisition;

(iii) the Borrower shall have furnished to the Lender such documentation and
other information that the Lender reasonably requests as to the target of such
acquisition in order to comply with its ongoing due diligence pursuant to
regulatory requirements and its internal policies, including its obligations
under applicable “know your customer” and anti-money laundering rules and
regulations, including the Patriot Act;

(iv) if required under Regulation S-X of the SEC, the Borrower shall have
furnished to the Lender within the time period prescribed under Regulation S-X,
a pro-forma balance sheet of the Borrower and each of its Subsidiaries
(including any Subsidiary formed or acquired in connection therewith) after
giving effect to the consummation of such Permitted Acquisition and any
incurrence of Loans to finance such Permitted Acquisition;

(v) both before and immediately after giving effect to the consummation thereof,
no Potential Event of Default or Event of Default shall have occurred and be
continuing;

(vi) the target of such Permitted Acquisition shall be engaged in a business
engaged in by the Borrower or any of its Subsidiaries on the Closing Date or
(a) a related, ancillary, supplementary or complementary business line, (b) a
reasonable expansion or extension thereof or (c) such other lines of business as
may be consented to in writing by the Lender (which consent shall not be
unreasonably withheld or delayed); and

(vii) the Borrower shall have furnished to the Lender (a) a Compliance
Certificate duly executed by its Chief Financial Officer that (x) to the extent
Borrower is required to deliver a pro forma balance sheet pursuant to clause
(iv) above, shows in reasonable detail the calculations used in determining the
financial covenants set forth in Sections 6.03(a) and 6.03(b) on a pro forma
basis as of the last day of the most recently ended period for which financial
statements have been delivered to Lender pursuant to Section 6.01(a)(i) or (ii),
and (y) states that no Potential Event of Default or Event of Default is
continuing as of the date of delivery of such Compliance Certificate or, if a
Potential Event of Default or Event of Default is continuing, states the nature
thereof and the action that the Borrower proposes to take with respect thereto
and (b) a certificate duly executed by an authorized officer of the Borrower
demonstrating compliance with the requirements of clauses (i) through (vi) above
and stating that, to the knowledge of the Borrower, such Permitted Acquisition
has been approved by the board of directors (or equivalent governing body) of
the Person to be acquired.

“Permitted Investors”: The Persons listed on Schedule 1.01(a)(ii) to the
Disclosure Letter.

“Permitted Lien”: As defined in Section 6.02(a).

 

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“Permitted Refinancing”: With respect to any Person, any amendment,
modification, replacement, refinancing, refunding, renewal or extension of any
Debt of such Person, provided that the principal amount (or accreted value, if
applicable) thereof does not exceed the principal amount (or accreted value, if
applicable) of the Debt so amended, modified, replaced, refinanced, refunded,
renewed or extended except by an amount equal to unpaid accrued interest and
premium, make whole amounts and penalties thereon plus other reasonable amounts
paid, and fees and expenses reasonably incurred, in connection with such
amendment, modification, replacement, refinancing, refunding, renewal or
extension and by an amount equal to any existing commitments unutilized
thereunder.

“Person”: An individual, partnership, corporation, limited liability company,
business trust, joint stock company, trust, unincorporated association, joint
venture, governmental authority or other entity of whatever nature, whether in
an individual, fiduciary or other capacity.

“Platform Contribution Transaction License Agreement”: Platform Contribution
Transaction License Agreement dated June 25, 2013, between the Borrower and Box
Intl Technology Ltd., as may be amended from time to time.

“Pledged Shares”: As defined in the Security Agreement.

“Potential Event of Default”: A condition or event which, after notice or lapse
of time or both, would constitute an Event of Default.

“Prime Rate”: At any time the rate of interest most recently announced within
Lender at its principal office as its Prime Rate, with the understanding that
the Prime Rate is one of Lender’s base rates and serves as the basis upon which
effective rates of interest are calculated for those loans making reference
thereto, and is evidenced by the recording thereof after its announcement in
such internal publication or publications as Lender may designate.

“Prime Rate Loans”: Loans hereunder at such time as they accrue interest at a
rate based upon the Prime Rate.

“Qualified Equity Interests”: Any Equity Interests that are not Disqualified
Equity Interests.

“Regulations T, U and X”: Regulations T, U and X, respectively, promulgated by
the Board, as amended from time to time, and any successors thereto.

“Replacement Assets”: With respect to any properties or assets subject to an
existing Lien, any replacements, substitutions, attachments and accessions of or
to such properties or assets subject to such Lien under the terms of the
documentation creating such Lien at the time such properties or assets are
acquired (or, with respect to the acquisition of a Person that owns such assets,
the time such Person becomes a Subsidiary) and proceeds and products of the
properties or assets subject to such Lien.

“Requirement”: As defined in Section 3.06.

“Restricted Payment”: any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in the
Borrower or any Subsidiary, or any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit, on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of
any Equity Interests in the Borrower or any Subsidiary.

“S&P”: Standard & Poor’s Ratings Service, or any successor thereto.

 

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“Sanctions”: As defined in Section 5.01(x).

“SEC”: The Securities and Exchange Commission, or any governmental authority
succeeding to any or all of its functions.

“Secured Obligations”: Collectively, (i) the Obligations, (ii) all Hedging
Obligations owing to the Lender or any of its Affiliates and (iii) all Cash
Management Obligations owing to the Lender or any of its Affiliates, provided
that “Secured Obligations” shall not, as to any Loan Party, include any Excluded
Swap Obligations of such Loan Party.

“Security Agreement”: The Security Agreement dated as of November 27, 2017 among
the Lender, the Borrower and the Guarantors from time to time party thereto, as
supplemented, amended, modified, amended and restated or replaced in writing
from time to time.

“Security Documents”: Collectively, the Security Agreement, and each other
security agreement or other instrument or document, in each case in form and
substance reasonably satisfactory to the Lender, delivered from time to time in
favor of the Lender pursuant to the terms of this Agreement to secure any of the
Secured Obligations.

“Solvent”: With respect to the Loan Parties on a consolidated basis, that as of
the date of determination, both (i) (a) the sum of the Loan Parties’ debts
(including contingent liabilities) does not exceed the present fair saleable
value of the Loan Parties’ present assets, (b) the Loan Parties’ capital is not
unreasonably small in relation to their business as contemplated on the Closing
Date or with respect to any transaction contemplated to be undertaken after the
Closing Date, and (c) the Loan Parties have not incurred and do not intend to
incur, or believe (nor should they reasonably believe) that they will incur,
debts beyond their ability to pay such debts generally as they become due
(whether at maturity or otherwise) and (ii) the Loan Parties are “solvent”
(within the meaning given that term and similar terms under the Bankruptcy Code
and applicable laws related to fraudulent transfers and conveyances). For
purposes of this definition, the amount of any contingent liability at any time
shall be computed as the amount that, in the light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.

“Subsidiary”: A corporation, partnership or other entity of which the relevant
Loan Party owns, directly or through another Subsidiary, at the date of
determination, more than 50% of the outstanding capital stock or membership
interests (or other shares of beneficial interest) having ordinary voting power
for the election of directors or other governing body or Person, irrespective of
whether or not at such time stock of any other class or classes might have
voting power by reason of the happening of any contingency, or holds at least a
majority of partnership or similar interests, or is a general partner of such a
partnership.

“Subsidiary Guarantee”: The Subsidiary Guarantee, in the form of Exhibit D, made
by the Guarantors party thereto in favor of the Lender, as supplemented,
amended, modified, amended and restated or replaced in writing from time to
time.

“Swap Obligation”: With respect to any Guarantor, any obligation to pay or
perform under any agreement, contract or transaction that constitutes a “swap”
within the meaning of Section 1a(47) of the Commodity Exchange Act.

“Taxes”: All present or future taxes, levies, imposes, duties, deductions,
withholding (including backup withholding), assessments, fees or other charges
imposed by any governmental authority, including any interest, additions to tax
or penalties applicable thereto.

 

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“U.S. Person”: Any Person that is a “United States Person” as defined in
Section 7701(a)(30) of the Internal Revenue Code.

“U.S. Tax Compliance Certificate”: As defined in Section 3.11(f)(ii)(B)(iii).

“UCC”: The Uniform Commercial Code as in effect from time to time in the State
of California.

“UK Bribery Act”: As defined in Section 5.01(y).

“Unrestricted Cash”: As of any date of determination, the amount (without
duplication) of unrestricted cash and Cash Equivalents of the Borrower or any
other Loan Party that is in deposit accounts or in securities accounts, or any
combination thereof, that are held in an account with (i) the Lender or any of
its Affiliates, or (ii) with any other financial institution, with respect to
which, in the case of any account with any Affiliate of the Lender or another
financial institution, the Lender has received an account control agreement over
such account, executed by such Affiliate or financial institution, the Lender
and the Borrower or such other Loan Party, in form and substance satisfactory to
the Lender, and in each case, classified as a “current asset” in accordance with
GAAP.

Section 1.02 Other Definitional Provisions.

(a) As used herein and in any certificate or other document made or delivered
pursuant hereto, accounting terms not defined in Section 1.01, and accounting
terms partly defined in Section 1.01 to the extent not defined, shall have the
respective meanings given to them under GAAP. Notwithstanding the foregoing, for
purposes of determining compliance with any covenant or requirement contained
herein or in any other Loan Document the effects of FASB ASC 606 on revenue
recognition shall be disregarded. If at any time any change in GAAP would affect
the computation of any financial ratio or requirement set forth in any Loan
Document, and either the Borrower or the Lender shall so request, the Borrower
and the Lender shall negotiate in good faith to amend such ratio or requirement
to preserve the original intent thereof in light of such change in GAAP,
provided that until so amended, (i) such ratio or requirement shall continue to
be computed in accordance with GAAP prior to such change therein and (ii) the
Borrower shall provide Lender financial statements and other documents required
under this Agreement or as reasonably requested herein setting forth a
reconciliation between calculations of such ratio or requirement made before and
after giving effect to such change in GAAP. Notwithstanding anything in this
Agreement or any other Loan Documents, if GAAP requires the Borrower subsequent
to the Closing Date to cause operating leases to be treated as capitalized
leases, including, without limitation, as a result of the implementation of
proposed changes to FASB ASC 840 and 842, then such change shall not be given
effect hereunder, and those types of leases which were treated as operating
leases as of the Closing Date shall continue to be treated as operating leases
and not capitalized leases.

(b) The words “hereof”, “herein” and “hereunder” and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement, and section, subsection, schedule
and exhibit references are to this Agreement unless otherwise specified.

(c) Any certificate or other writing required hereunder or under any other Loan
Document to be certified by any officer or other authorized representative of
any Person shall be deemed to be executed and delivered by such officer or other
authorized representative solely in such individual’s capacity as an officer or
other authorized representative of such Person and not in such officer’s or
other authorized representative’s individual capacity.

 

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(d) Unless the context requires otherwise any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein or in any other Loan
Document).

(e) For the purposes of calculating EBITDA in connection with any financial
ratio or test for any measurement period, if at any time during such period the
Borrower or a Subsidiary shall have consummated a Permitted Acquisition that
requires the Borrower to deliver a pro forma balance sheet pursuant to clause
(iv) of the definition of “Permitted Acquisition”, then EBITDA for such period
shall be calculated after giving pro forma effect thereto (including pro forma
adjustments arising out of events which are directly attributable to such
Permitted Acquisition, including as a result of actions taken or expected to be
taken (in the good faith determination of Borrower) and are reasonably
identifiable and factually supportable, and are expected to have a continuing
impact, and, in each case, which are (x) determined on a basis consistent with
Article 11 of Regulation S-X promulgated under the Securities Act and as
interpreted by the staff of the SEC, or (y) reflected in any pro forma financial
model of Borrower and its Subsidiaries delivered to the Lender and which pro
forma adjustments are reasonably acceptable to the Lender, or otherwise to be
mutually and reasonably agreed upon by the Borrower and the Lender) or in such
other manner acceptable to the Lender; in each case, as if any such Permitted
Acquisition occurred on the first day of such period.

ARTICLE II.

THE LOANS

Section 2.01 The Loans.

(a) The Commitment. The Lender agrees, on the terms and conditions hereinafter
set forth, to make Loans to the Borrower from time to time during the period
from the date hereof to but excluding the Maturity Date in an aggregate amount
not to exceed the Commitment at any time outstanding. Within the limits of the
Commitment, the Borrower may borrow, repay pursuant to Section 2.02(b) and
reborrow under this Section 2.01(a).

(b) Making the Loans.

(i) Loans. Each borrowing under this Section 2.01 (a “Borrowing”) shall be in a
minimum amount of $100,000 or an integral multiple of $100,000 above such
amount. Subject to Section 3.08, each Borrowing shall be comprised entirely of
Prime Rate Loans or LIBOR Loans, as the Borrower may request in accordance
herewith. The Borrower may borrow under the Commitment, less the aggregate face
amount of Letters of Credit issued under the Letter of Credit Sublimit, on any
Business Day (or for LIBOR Loans, any LIBOR Business Day), provided that the
Borrower shall give the Lender irrevocable written notice substantially in the
form of Exhibit A hereto (which notice must be received by the Lender prior to
12:00 p.m., California time) (1) in the case of Prime Rate Loans, on such
requested Borrowing date, and (2) in the case of LIBOR Loans, two (2) LIBOR
Business Days prior to the requested Borrowing date, in each case specifying
(A) the amount of the proposed Borrowing, (B) the requested date of the
Borrowing, (C) whether such Borrowing is to be a Prime Rate Loan or a LIBOR Loan
(and if no election is indicated, such Borrowing shall be a Prime Rate Loan) and
(D) if such Borrowing is a LIBOR Loan, the length of the Interest Period
therefor. Upon satisfaction or waiver of the applicable conditions set forth in
Article IV, the Lender will make available the proceeds of all such Loans to the
Borrower by crediting the account of

 

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the Borrower on the books of the Lender, or as otherwise directed by the
Borrower. The Lender’s failure to receive any written notice of a particular
Borrowing shall not relieve the Borrower of its obligations to repay the
Borrowing made and to pay interest thereon. The Lender shall not incur any
liability to the Borrower in acting upon any notice of Borrowing which the
Lender believes in good faith to have been given by a Person duly authorized to
borrow on behalf of the Borrower.

(ii) Letters of Credit. Subject to the terms and conditions of this Agreement,
Lender hereby agrees to issue or cause an affiliate to issue standby letters of
credit for the account of Borrower (each, a “Letter of Credit” and collectively,
“Letters of Credit”) from time to time up to and including the Maturity Date;
provided however, that the aggregate of all undrawn amounts, and all amounts
drawn and unreimbursed, under any Letters of Credit issued shall not at any time
exceed the Letter of Credit Sublimit. The form and substance of each Letter of
Credit shall be subject to approval by Lender, in its sole discretion. Each
Letter of Credit shall be subject to the additional terms of the Letter of
Credit agreements, applications and any related documents required by Lender in
connection with the issuance thereof (each, a “Letter of Credit Agreement”).
Borrower agrees to execute any further documentation in connection with the
Letters of Credit as Lender may reasonably request. Borrower further agrees to
be bound by the regulations and interpretations of the issuer of any Letters of
Credit guaranteed by Lender and opened for Borrower’s account or by Lender’s
interpretations of any Letter of Credit issued by Lender for Borrower’s account,
and Borrower understands and agrees that Lender shall not be liable for any
error, negligence, or mistake, whether of omission or commission, in following
Borrower’s instructions or those contained in the Letters of Credit or any
modifications, amendments, or supplements thereto. If, on the 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
Lender cash collateral in an amount equal to at least 100% of the aggregate
dollar equivalent of the face amount of all such Letters of Credit plus all
interest, fees, and costs due or estimated by Bank to become due in connection
therewith, to secure all of the Obligations relating to such Letters of Credit.

(c) Note. The Loans made by the Lender pursuant hereto shall be evidenced by a
Note payable to the Lender and representing the obligation of the Borrower to
pay the aggregate unpaid principal amount of all outstanding Loans, with
interest thereon as prescribed in Section 2.03. The Lender is hereby authorized
to record in its books and records and on any schedule annexed to the Note the
date and amount of each Loan made by the Lender, and the date and amount of each
payment of principal thereof, and any such recordation shall constitute prima
facie evidence of the accuracy of the information so recorded, provided that
failure by the Lender to effect such recordation shall not affect the Borrower’s
obligations hereunder. Prior to the transfer of a Note, the Lender shall record
such information on any schedule annexed to and forming a part of such Note.

Section 2.02 Repayment.

(a) Mandatory Repayment. The aggregate principal amount of the Loans outstanding
on the Maturity Date, together with accrued but unpaid interest thereon, shall
be due and payable in full on the Maturity Date.

(b) Optional Prepayment. Subject to Section 3.07, the Borrower may at its option
prepay the Loans, in whole or in part, at any time and from time to time without
premium or penalty, provided that the Lender shall have received from the
Borrower notice of any such prepayment no later

 

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than 11:00 a.m. California time (i) two (2) LIBOR Business Days prior to any
date of prepayment of any LIBOR Loan and (ii) on the date of prepayment of any
Prime Rate Loan, in each case specifying the date and the amount of prepayment.
Partial prepayments hereunder shall be in an aggregate principal amount of the
lesser of (a) a minimum of $100,000 and in an integral multiple of $100,000 and
(b) the outstanding balance of the Loan being paid.

(c) Reduction or Termination of Commitment. At any time, the Borrower may, upon
not less than five (5) Business Days’ prior written notice to the Lender,
terminate or permanently reduce the Commitment without premium or penalty by an
aggregate minimum amount of $5,000,000 or any integral multiple of $5,000,000 in
excess thereof; unless, after giving effect thereto and to any prepayments of
Loans made pursuant to Section 2.02(b), the outstanding principal amount of all
Loans would exceed the amount of the Commitment sought to be in effect after
such reduction. Once reduced in accordance with this Section 2.02(c), the
Commitment may not be increased.

Section 2.03 Interest Payment Dates and Interest Rate.

(a) Payment of Interest. Interest with respect to each Loan shall be payable in
arrears on each Interest Payment Date for such Loan.

(b) Prime Rate Loans. Loans which are Prime Rate Loans shall bear interest on
the unpaid principal amount thereof at a rate per annum equal to the Prime Rate
plus the Applicable Margin.

(c) LIBOR Loans. Loans which are LIBOR Loans shall bear interest for each
Interest Period with respect thereto on the unpaid principal amount thereof at a
rate per annum equal to LIBOR determined for such Interest Period in accordance
with the terms hereof plus the Applicable Margin.

Section 2.04 Continuation; Conversion.

The Borrower may elect from time to time to (a) continue any outstanding LIBOR
Loan upon the expiration of the Interest Period applicable thereto as a LIBOR
Loan by giving to the Lender at least two (2) LIBOR Business Days’ prior
irrevocable written notice of continuation and the succeeding Interest Period of
such continued Loan will commence on the last day of the Interest Period of the
Loan to be continued, (b) convert any outstanding LIBOR Loan upon expiration of
the Interest Period applicable thereto to a Prime Rate Loan by giving to the
Lender at least one (1) Business Day’s prior irrevocable written notice of
conversion and (c) convert any outstanding Prime Rate Loan to a LIBOR Loan by
giving to the Lender at least two (2) LIBOR Business Days’ prior irrevocable
written notice of conversion, provided that no Loan may be continued as a Loan
other than a Prime Rate Loan if an Event of Default or Potential Event of
Default has occurred and is continuing. Each such irrevocable written notice
electing to continue or convert a Loan shall specify: (i) the proposed
continuation or conversion date, (ii) the amount of the Loan to be continued or
converted, (iii) the nature of the proposed continuation or conversion
(including whether the converted Loan will be a LIBOR Loan or a Prime Rate Loan)
and (iv) for Loans being continued as or converted to LIBOR Loans, the requested
Interest Period, and shall certify that no Event of Default or Potential Event
of Default has occurred and is continuing. On the date on which such
continuation or conversion is being made, the Lender shall take such action as
is necessary to effect such continuation or conversion. In the event that no
notice of continuation or conversion, or an incomplete notice of continuation or
conversion, is received by the Lender with respect to outstanding LIBOR Loans,
or if an Event of Default or Potential Event of Default has occurred and is
continuing, then upon expiration of the Interest Period(s) applicable thereto,
such Loans shall automatically convert to Prime Rate Loans.

 

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Section 2.05 Fees.

(a) Annual Loan Fee. The Borrower agrees to pay to the Lender, an annual fee
equal to the Commitment multiplied by 0.20%. Such fee will be fully earned and
shall be due and payable in advance in full in cash on the Closing Date and on
each annual anniversary thereof.

(b) Letter of Credit Fees. Borrower shall pay to Lender (i) fees upon the
issuance of each Letter of Credit equal to 0.75% per annum (computed on the
basis of a 360-day year, actual days elapsed) of the face amount thereof, and
(ii) fees upon the payment or negotiation of each drawing under any Letter of
Credit and fees upon the occurrence of any other activity with respect to any
Letter of Credit (including without limitation, the transfer, amendment or
cancellation of any Letter of Credit) determined in accordance with Lender’s
standard fees and charges then in effect for such activity.

(c) Lender Expenses. Borrower shall pay to Lender all Lender Expenses (including
reasonable attorneys’ fees and expenses for documentation and negotiation of
this Agreement, provided that such fees paid by Borrower for the documentation
and negotiation of this Agreement through the Closing Date and completion of any
post-closing items pursuant to Section 6.01(r) will not exceed the lesser of (i)
50% of all such attorneys’ fees and expenses incurred by Lender or (ii) Twenty
Thousand Dollars ($20,000)) incurred through and after the Closing Date, when
due (or, if no stated due date, upon demand by Lender).

Section 2.06 Cash Collateralization.

(a) Hedging Obligations. Upon the request of the Lender during the continuance
of any Event of Default, the Borrower shall immediately Cash Collateralize the
outstanding Hedging Obligations owing to the Lender or any of its Affiliates in
an amount equal to 100% of the aggregate amount of such Hedging Obligations.

(b) Cash Management Obligations. Upon the request of the Lender during the
continuance of any Event of Default, the Borrower shall immediately Cash
Collateralize the outstanding Cash Management Obligations owing to the Lender or
any of its Affiliates in an amount equal to 100% of the aggregate amount of such
Cash Management Obligations.

(c) Security Interest. The Borrower hereby grants to the Lender a security
interest in all cash, deposit accounts and all balances in such cash or deposit
accounts and all proceeds of the foregoing deposited as cash collateral pursuant
to this Section 2.06 or Section 7.01.

(d) Return of Cash Collateral. Cash Collateral provided under this Section 2.06
shall be returned to the Borrower within five (5) Business Days after all Events
of Default or Potential Events of Default have been cured or waived. Any such
release shall be without prejudice to, and any disbursement or other transfer of
Cash Collateral shall be and remain subject to, any other Lien conferred under
the Loan Documents and the other applicable provisions of the Loan Documents.

ARTICLE III.

GENERAL PROVISIONS CONCERNING THE LOANS

Section 3.01 Use of Proceeds. The proceeds of the Loans hereunder shall be used
by the Borrower (i) to repay all outstanding Debt owed to the Existing Lender
and the other lenders under the Existing Credit Agreement; (ii) to pay fees and
expenses incurred in connection with this Agreement and the other Loan
Documents, and (iii) for working capital and general corporate purposes of the
Borrower and its Subsidiaries (including, to finance any Permitted Acquisition).

 

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Section 3.02 Default Interest. Notwithstanding anything to the contrary
contained in Section 2.03, any amounts payable hereunder which are not paid when
due shall bear interest at a rate per annum which is equal to 3.00% above the
rate which would otherwise be applicable pursuant to Section 2.03 or otherwise
under this Agreement from the date of such nonpayment until paid in full (after
as well as before judgment), payable on demand.

Section 3.03 Computation of Interest.

(a) Calculations. All computations of interest for Prime Rate Loans when the
Prime Rate is determined by the Lender’s prime lending rate shall be made on the
basis of the year of 365 or 366 days, as the case may be, and the actual number
of days elapsed. All other interest and fees hereunder shall be calculated on
the basis of a 360 day year for the actual days elapsed. Any change in the
interest rate on a Prime Rate Loan resulting from a change in the Prime Rate
shall become effective as of the opening of business on the day on which such
change in the Prime Rate shall become effective.

(b) Determination by Lender. Each determination of an interest rate by the
Lender pursuant to any provision of this Agreement shall be conclusive and
binding on the Borrower in the absence of manifest error.

Section 3.04 Payments. The Borrower shall make each payment of principal,
interest and fees hereunder and under the Note, without set-off or counterclaim,
not later than 12:00 p.m., California time, on the day when due in lawful money
of the United States of America to the Lender at the office of the Lender
designated from time to time in immediately available funds. Subject to the
provisions set forth in the definition of “Interest Period”, if any payment
hereunder shall be stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day, and such extension of
time shall in such case be included in the computation of interest or fees, as
the case may be.

Section 3.05 Delay in Requests. Failure or delay on the part of the Lender to
demand compensation pursuant to Section 3.06, 3.07 or 3.09 shall not constitute
a waiver of the Lender’s right to demand such compensation, except that the
Borrower shall not be required to compensate the Lender pursuant to those
Sections for any increased costs incurred or reductions suffered more than 180
days prior to the date that the Lender notifies the Borrower of the change in
law giving rise to such increased costs or reductions and of the Lender’s
intention to claim compensation therefor, unless the change in law giving rise
to such increased costs or reduction is retroactive, in which case the 180 day
period referred to above shall be extended to include the period of retroactive
effect thereof.

Section 3.06 Reduced Return. If the Lender shall have determined that any Change
in Law (each, a “Requirement”) regarding capital or liquidity requirements has
or would have the effect of reducing the rate of return on the Lender’s or its
holding company’s capital as a consequence of its Commitment, Loans and
obligations hereunder (and which has not been taken into account in computing
LIBOR or the Applicable Reserve Requirement) to a level below that which would
have been achieved but for such Requirement or compliance therewith (taking into
consideration the Lender’s policies with respect to capital or liquidity
requirements) by an amount deemed by the Lender to be material (which amount
shall be determined by the Lender’s reasonable allocation of the aggregate of
such reductions resulting from such events), then from time to time, within ten
(10) Business Days after demand (accompanied by a statement setting forth and
explaining the change in such requirement and including all relevant
calculations relating thereto) by the Lender, the Borrower shall pay to the
Lender such additional amount or amounts as will compensate the Lender for such
reduction. The determination of such amount by the Lender shall be presumed
correct absent manifest error. This covenant shall survive termination of this
Agreement and the payment of the Obligations.

 

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Section 3.07 Funding Losses. The Borrower hereby agrees to indemnify the Lender
and to hold the Lender harmless from any loss or expense, including, but not
limited to, any such loss or expense arising from interest or fees payable by
the Lender to lenders of funds obtained by it in order to maintain its LIBOR
Loans hereunder, in each case, which the Lender actually sustains or incurs (in
each case, excluding loss of anticipated profits or margin) as a consequence of
(i) the Borrower failing to borrow or continue any LIBOR Loan after notice has
been given to the Lender in accordance with this Agreement (whether or not
withdrawn by the Borrower), (ii) if for any reason a LIBOR Loan must be
converted to a Prime Rate Loan in accordance with this Agreement, (iii) default
by the Borrower in making any prepayment of a LIBOR Loan on any date specified
in a prepayment notice thereof in accordance with Section 2.02(b) or (iv) the
Borrower making any payment of a LIBOR Loan on a day other than the last day of
the Interest Period for such Loan. For purposes of this Section 3.07, it shall
be assumed that the Lender had funded or would have funded 100%, as the case may
be, of a LIBOR Loan in the London interbank market for a corresponding amount
and term. The determination of such amount by the Lender shall be presumed
correct in the absence of manifest error. This covenant shall survive
termination of this Agreement and the payment of the Obligations.

Section 3.08 Inability to Determine Interest Rate. In the event that the Lender
shall have determined (which determination shall be conclusive and binding upon
the Borrower) that by reason of circumstances affecting the London interbank
market, adequate and reasonable means do not exist for ascertaining LIBOR
applicable pursuant to Section 2.03 for any Interest Period with respect to a
LIBOR Loan that will result from a requested LIBOR Loan or that such rate of
interest does not adequately cover the cost of funding such Loan, the Lender
shall forthwith give notice of such determination to the Borrower not later than
1:00 p.m. California time, on the requested Borrowing date or the last day of an
Interest Period of a Loan which was to have been continued as a LIBOR Loan. If
such notice is given and has not been withdrawn, (i) any requested LIBOR Loan
shall be made as a Prime Rate Loan, or, at the Borrower’s option, such Loan
shall not be made, and (ii) any outstanding LIBOR Loan shall be converted, on
the last day of the then current Interest Period with respect thereto, to a
Prime Rate Loan. Until such notice has been withdrawn by the Lender, no further
LIBOR Loans shall be made. The Lender will review the circumstances affecting
the London interbank market from time to time and the Lender will withdraw such
notice at such time as it shall determine that the circumstances giving rise to
said notice no longer exist.

Section 3.09 Requirements of Law. In the event that any Change in Law:

(a) does or shall subject the Lender to any Taxes with respect to this
Agreement, the Note or any Loan made, or change the basis of taxation of
payments to the Lender of principal, interest, fee or any other amount payable
hereunder (except for (A) Indemnified Taxes, (B) Excluded Taxes and
(C) Connection Income Taxes, or changes in the rates thereof);

(b) does or shall impose, modify or hold applicable any reserve, assessment
rate, special deposit, compulsory loan or other requirement against assets held
by, or deposits or other liabilities in or for the account of, advances or loans
by, or other credit extended with respect to any Loan Document or any Loan by,
or any other acquisition of funds by, any office of the Lender which are not
otherwise included in the determination of LIBOR at the last Borrowing or
continuation date of a Loan;

(c) does or shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or other requirement against the Commitment to extend
credit; or

 

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(d) does or shall impose on the Lender any other condition with respect to any
Loan Document or any Loan; and the result of any of the foregoing is to increase
the cost to the Lender of making, renewing or maintaining its Commitment or the
LIBOR Loans or to reduce any amount receivable thereunder (which increase or
reduction shall be determined by the Lender’s customary allocation of the
aggregate of such cost increases or reduced amounts receivable resulting from
such events), then, in any such case, the Borrower shall pay to the Lender,
within ten (10) Business Days of its demand, any additional amounts necessary to
compensate the Lender for such additional cost or reduced amount receivable as
determined by the Lender with respect to this Agreement. If the Lender becomes
entitled to claim any additional amounts pursuant to this Section 3.09, it shall
notify the Borrower of the event by reason of which it has become so entitled. A
statement incorporating the calculation as to any additional amounts payable
pursuant to the foregoing sentence submitted by the Lender to the Borrower shall
be presumed correct in the absence of manifest error. This covenant shall
survive termination of this Agreement and the payment of the Obligations.

Section 3.10 Illegality. Notwithstanding any other provisions herein, if any
Change in Law shall make it unlawful, impossible, or impracticable for the
Lender to make or maintain LIBOR Loans as contemplated by this Agreement,
(a) the commitment of the Lender hereunder to make LIBOR Loans shall forthwith
be cancelled and (b) the Lender’s Loans then outstanding as LIBOR Loans, if any,
shall be converted automatically to Prime Rate Loans on the last day of the then
current Interest Period with respect thereto or within such earlier period as
required by law. The Borrower hereby agrees to pay the Lender, within three
(3) Business Days of its demand, any additional amounts necessary to compensate
the Lender for any actual costs incurred by the Lender in making any conversion
in accordance with this Section 3.10, including, but not limited to, any
interest or fees payable by the Lender to lenders of funds obtained by it in
order to make or maintain its LIBOR Loans hereunder (the Lender’s notice of such
costs, as certified to the Borrower, to be presumed correct absent manifest
error).

Section 3.11 Taxes.

(a) Payments Free of Taxes. Any and all payments by or on account of any
obligation of the Borrower hereunder shall be made free and clear of and without
deduction for any Taxes, except as required by applicable law. If the Borrower
shall be required by law to deduct or withhold any Taxes from such payments,
then (i) the Borrower shall make all required deductions, (ii) the Borrower
shall pay the full amount deducted to the relevant governmental authority in
accordance with applicable law, and (iii) if such tax is an Indemnified Tax, the
sum payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 3.11) the Lender receives an amount equal to the sum it would have
received had no such deductions been made.

(b) Payment of Other Taxes by the Borrower. In addition, the Borrower shall pay
all Other Taxes in accordance with applicable law or, at the election of the
Lender, timely reimburse it for the payment of such Other Taxes.

(c) Indemnification by the Borrower. The Borrower shall indemnify the Lender,
within ten (10) Business Days after written demand therefor, for the full amount
of any Indemnified Taxes paid by the Lender on or with respect to any payment by
or on account of any obligation of the Borrower hereunder (including any such
Indemnified Taxes imposed or asserted on or attributable to amounts payable
under this Section 3.11) and any reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes were correctly or legally
imposed or asserted by the relevant governmental authority. A certificate as to
the amount of such payment or liability delivered to the Borrower by the Lender
shall be presumed correct absent manifest error.

 

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(d) Evidence of Payments. As soon as practicable after any payment of any Taxes
by the Borrower to a governmental authority pursuant to this Section 3.11, the
Borrower shall deliver to the Lender the original or a certified copy of a
receipt issued by such governmental authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Lender.

(e) Refunds. If the Lender determines in its sole discretion exercised in good
faith that it has received a refund of any Taxes as to which it has been
indemnified by the Borrower or with respect to which the Borrower has paid
additional amounts pursuant to this Section 3.11, it shall pay over such refund
to the Borrower (but only to the extent of indemnification payments made, or
additional amounts paid, by the Borrower under this Section 3.11 with respect to
such Taxes giving rise to such refund), net of all out-of-pocket expenses of the
Lender and without interest (other than any interest paid by the relevant
governmental authority with respect to such refund), provided that the Borrower,
upon the request of the Lender, shall repay the amount paid over to the Borrower
to the Lender in the event the Lender is required to repay such refund to such
governmental authority. This Section 3.11 shall not be construed to require the
Lender to make available its tax returns (or any other information relating to
its taxes which it deems confidential) to the Borrower or any other Person.

(f) Status of Lenders. (i) The Lender or other relevant party that is entitled
to an exemption from or reduction of withholding Tax with respect to payments
made under any Loan Document shall deliver to the Borrower, at any time
reasonably requested by the Borrower such properly completed and executed
documentation reasonably requested by the Borrower as will permit such payments
to be made without withholding or at a reduced rate of withholding. In addition,
the Lender or other relevant party if reasonably requested by the Borrower shall
deliver such other documentation prescribed by applicable law or reasonably
requested by the Borrower as will enable the Borrower to determine whether or
not the Lender or other relevant party is subject to United States backup
withholding or information reporting requirements. Notwithstanding anything to
the contrary in the preceding two sentences, the completion, execution and
submission of such documentation (other than such documentation set forth in
Section 3.11(f)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in
the Lender’s reasonable judgment such completion, execution or submission would
subject the Lender to any material unreimbursed cost or expense or would
materially prejudice the legal or commercial position of the Lender.

(ii) Without limiting the generality of the foregoing:

(A) the Lender or other relevant party that is a U.S. Person shall deliver to
the Borrower on or prior to the date of this Agreement or the date on which such
other relevant party becomes the Lender under this Agreement (and from time to
time thereafter upon the reasonable request of the Borrower), executed originals
of IRS Form W-9 certifying that Lender or other relevant party is exempt from
Federal backup withholding tax;

(B) the Lender or other relevant party that is not a U.S. Person (a “Non-U.S.
Lender Party”) shall, to the extent it is legally entitled to do so, deliver to
the Borrower (in such number of copies as shall be requested by the Borrower) on
or prior to the date on which such Non-U.S. Lender Party becomes the Lender or
other relevant party under this Agreement (and from time to time thereafter upon
the reasonable request of the Borrower), whichever of the following is
applicable;

 

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(i) in the case of a Non-U.S. Lender Party claiming the benefits of an income
tax treaty to which the United States is a party (x) with respect to payments of
interest under any Loan Document, executed originals of IRS Form W-8BEN
establishing an exemption from, or reduction of, Federal withholding Tax
pursuant to the “interest” article of such tax treaty and (y) with respect to
any other applicable payments under any Loan Document, IRS Form W-8BEN
establishing an exemption from, or reduction of, Federal withholding Tax
pursuant to the “business profits” or “other income” article of such tax treaty;

(ii) executed originals of IRS Form W-8ECI;

(iii) in the case of a Non-U.S. Lender Party claiming the benefits of the
exemption for portfolio interest under Section 881(c) of the Internal Revenue
Code, (x) a certificate to the effect that such Non-U.S. Lender Party is not a
“bank” within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code,
a “10 percent shareholder” of the Borrower within the meaning of
Section 881(c)(3)(B) of the Internal Revenue Code, or a “controlled foreign
corporation” described in Section 881(c)(3)(C) of the Internal Revenue Code (a
“U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form
W-8BEN; or

(iv) to the extent a Non-U.S. Lender Party is not the beneficial owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, a
U.S. Tax Compliance Certificate, IRS Form W-9, and/or other certification
documents from each beneficial owner, as applicable, provided that if the
Non-U.S. Lender Party is a partnership and one or more direct or indirect
partners of such Non-U.S. Lender party are claiming the portfolio interest
exemption, such Non-U.S. Lender Party may provide a U.S. Tax Compliance
Certificate on behalf of each such direct and indirect partner;

(C) any Non-U.S. Lender Party shall, to the extent it is legally entitled to do
so, deliver to the Borrower (in such number of copies as shall be requested by
the Borrower) on or prior to the date on which such Non-U.S. Lender Partner
becomes the Lender under this Agreement (and from time to time thereafter upon
the reasonable request of the Borrower) executed originals of any other form
prescribed by applicable law as a basis for claiming exemption from or a
reduction in Federal withholding Tax, duly completed, together with such
supplementary documentation as may be prescribed by applicable law to permit the
Borrower to determine the withholding or deduction required to be made; and

(D) if a payment made to the Lender (or other relevant party) under any Loan
Document would be subject to Federal withholding Tax imposed by FATCA if the
Lender (or other relevant party) were to fail to comply with the applicable
reporting requirements of FATCA (including those contained in Section 1471(b) or
1472(b) of the Internal Revenue Code, as applicable), the Lender (or other
relevant party) shall deliver to the Borrower at the time or times prescribed by
law and at such time or times reasonably requested by the Borrower such
documentation prescribed by applicable law (including as prescribed by
Section 1471(b)(3)(C)(1) of the Internal Revenue Code) and such additional
documentation reasonably requested by the Borrower as may be necessary for the
Borrower to comply with its obligations under FATCA and to determine that the
Lender (or other relevant party) has complied with the Lender’s (or other
relevant party’s) obligations under FATCA or to determine the amount to deduct
and withhold from such payment. Solely for purposes of this clause (D), “FATCA”
shall include any amendments made to FATCA after the date of this Agreement.

 

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If any form or certification previously delivered expires or becomes obsolete or
inaccurate in any respect, the Lender (or other relevant party) shall update
such form or certification or promptly notify the Borrower in writing of its
legal inability to do so.

ARTICLE IV.

CONDITIONS OF LENDING

Section 4.01 Conditions Precedent to Credit Facility. The effectiveness of this
Agreement and the obligations of the Lender to make Loans hereunder on the
Closing Date are subject to the conditions precedent that:

(a) The Lender shall have received the following, each in form and substance
satisfactory to the Lender in its sole discretion:

(i) executed copies of this Agreement, the Note, the Security Agreement and each
other Loan Document;

(ii) a copy of the certificate of incorporation of the Borrower, certified as of
a recent date by the Secretary of State of the State of Delaware;

(iii) a copy of the bylaws of the Borrower, certified by the Secretary or an
Assistant Secretary or other authorized person of the Borrower;

(iv) a copy of resolutions of the Board of Directors or other authorizing
documents of the Borrower approving the Loan Documents and the Borrowings
hereunder;

(v) an incumbency certificate executed by the Secretary or an Assistant
Secretary or other authorized person of the Borrower or equivalent document,
certifying the names and signatures of the officers of the Borrower or other
Persons authorized to sign the Loan Documents and the other documents to be
delivered hereunder;

(vi) a certificate of good standing or its equivalent and evidence of good
standing as to payment of any applicable franchise or similar taxes with respect
to the Borrower from the Secretary of State of the State of Delaware;

(vii) evidence that all governmental, regulatory and other third party consents
and approvals required in connection with the Loan Documents and the Borrowings
hereunder have been obtained and are in full force and effect;

(viii) a favorable opinion or opinions of counsel for the Borrower addressing
issues under California and Delaware law, dated the Closing Date;

(ix) evidence of payment of all costs, expenses, fees and other compensation
(including reasonable, documented and out-of-pocket attorneys’ fees and
expenses) required to be paid to the Lender by the Borrower pursuant to this
Agreement or any other written agreement on or prior to the Closing Date;

(x) a certificate from the Chief Financial Officer of the Borrower or other
authorized officer with knowledge of the financial position of the Borrower
dated the Closing Date certifying as to the matters set forth in Section 5.01(p)
of this Agreement as to Solvency;

 

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(xi) a completed Compliance Certificate for the fiscal quarter ending July 31,
2017;

(xii) such documentation and other information that the Lender requests as to
the Borrower in order to comply with its ongoing due diligence pursuant to
regulatory requirements and its internal policies, including its obligations
under applicable “know your customer” and anti-money laundering rules and
regulations, including the Patriot Act;

(xiii) other than as delivered pursuant to Section 4.03 of this Agreement,
evidence that the Lender shall have a valid and perfected first priority
security interest in the Collateral (subject to Permitted Liens, except with
respect to the Collateral that is required to be physically delivered to the
Lender pursuant to the Security Documents) (including (w) any documents
reasonably requested by the Lender or as required by the terms of the Security
Documents to evidence its security interest in the Collateral (including,
without limitation, any Landlord Subordination Agreements, bailee letters,
control agreements and filings evidencing a security interest in any
intellectual property included in the Collateral); (x) copies of lien search
reports and of all effective prior filings listed therein, together with
evidence of the termination of such prior filings (except with respect to
Permitted Liens), in each case as may be requested by the Lender, (y) such
documents duly executed by the Borrower as the Lender may request with respect
to the perfection of its security interests in the Collateral (including
financing statements under the UCC and other applicable documents under the laws
of any jurisdiction with respect to the perfection of Liens created by the
Security Documents) and (z) all certificates, instruments and other documents
representing the Collateral and related undated powers or endorsements duly
executed in blank);

(xiv) a completed perfection certificate as to the Borrower, dated the Closing
Date and signed by an authorized officer of the Borrower, together with all
attachments contemplated thereby;

(xv) an executed payoff letter from the Existing Lender which shall, among other
things, provide for the discharge of all Liens over the property of the Borrower
in favor of the Existing Lender in connection with the Existing Credit
Agreement;

(xvi) evidence of insurance coverage, in form, substance, amounts, covering
risks and issued by companies satisfactory to the Lender, and where required by
the Lender, with lender loss payable endorsements in favor of the Lender;

(xvii) such other certificates and documents as the Lender shall reasonably
request;

(b) all corporate and legal proceedings and all instruments and documents in
connection with the transactions contemplated by this Agreement shall be
reasonably satisfactory in content, form and substance to the Lender and its
counsel, and the Lender and the Lender’s counsel shall have received any and all
further information and documents which the Lender or such counsel may
reasonably have requested in connection therewith, such documents where
appropriate to be certified by proper corporate or governmental authorities;

 

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(c) completion by the Lender of a due diligence investigation of the Borrower in
scope, and with results, satisfactory to the Lender in its reasonable
discretion;

(d) neither the Borrower nor any of its Subsidiaries shall be in default in the
performance of any agreement or instrument to which it may be a party or by
which its properties may be bound, or in violation of any law, in any case which
defaults and violations, individually or in the aggregate, have had or could
reasonably be expected to have a Material Adverse Effect;

(e) the representations and warranties contained in this Agreement and the other
Loan Documents shall be true, correct and complete in all material respects (or,
in the case of any such representation or warranty already qualified by
materiality or reference to Material Adverse Effect, in all respects) on and as
of the Closing Date as though made on and as of the Closing Date, except to the
extent such representations and warranties specifically relate to an earlier
date, in which case such representations and warranties were true, correct and
complete in all material respects (or, in the case of any such representation or
warranty already qualified by materiality or reference to Material Adverse
Effect, in all respects) on and as of such earlier date;

(f) no event or condition shall have occurred and be continuing that would
constitute an Event of Default or Potential Event of Default; and

(g) since the date of the most recent audited financial statements received by
the Lender prior to the Closing Date, no Material Adverse Effect shall have
occurred.

Section 4.02 Conditions Precedent to Each Borrowing. The obligation of the
Lender to make a Loan on the occasion of each Borrowing (including the initial
Borrowing) shall be subject to the further condition precedent that on the date
of such Borrowing, the following statements shall be true and the Lender shall
have received the notice required by Section 2.01(b), which notice shall be
deemed to be a certification by the Borrower that:

(a) the representations and warranties contained in this Agreement and the other
Loan Documents are true, correct and complete in all material respects (or, in
the case of any such representation or warranty already qualified by materiality
or reference to Material Adverse Effect, in all respects) on and as of such date
as though made on and as of such date, except to the extent such representations
and warranties specifically relate to an earlier date, in which case such
representations and warranties were true, correct and complete in all material
respects (or, in the case of any such representation or warranty already
qualified by materiality or reference to Material Adverse Effect, in all
respects) on and as of such earlier date;

(b) no event or condition has occurred and is continuing, or would result from
such Borrowing that would constitute an Event of Default or Potential Event of
Default; and

(c) all Loan Documents are in full force and effect.

Section 4.03 Post Closing Conditions. Borrower agrees to deliver the following
items to Bank:

(a) within five (5) Business Days (or any longer period agreed to by Bank) after
the date hereof, to the extent such Equity Interests are certificated, the
certificates for the Equity Interests of Borrower’s Subsidiaries, together with
Stock Powers, duly executed in blank; provided that such certificates shall be
for 100% of the voting power of all classes of the Equity Interests with respect
to any Domestic Subsidiary and 65% of the voting power of all classes of the
Equity Interests of a Foreign Subsidiary (or Domestic Subsidiary of a Foreign
Subsidiary that is a CFC);

 

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(b) within sixty (60) days (or any longer period agreed to by Bank) after the
date hereof, account control agreements, in form and substance satisfactory to
the Lender, and executed by the financial institution or securities intermediary
at which the Borrower’s deposit account(s) or securities account(s) not held
with Lender and constituting Collateral, as the case may be, are maintained;

(c) within sixty (60) days (or any longer period agreed to by Bank) after the
date hereof, a Landlord Subordination Agreement, in form and substance
reasonably acceptable to Bank, in favor of Bank for 900 Jefferson Ave., Redwood
City, CA 94063 by the respective landlord thereof, together with the duly
executed original signatures thereto.

ARTICLE V.

REPRESENTATIONS AND WARRANTIES

Section 5.01 Representations and Warranties. The Borrower represents and
warrants as follows:

(a) Organization. Each Loan Party and each of its Subsidiaries is duly
incorporated, formed or organized, as applicable, validly existing and in good
standing under the laws of the jurisdiction of its incorporation, formation or
organization (to the extent such concept is relevant or applicable in such
jurisdiction) and each jurisdiction where such Loan Party is required to be
qualified to do business unless the failure to so qualify is not likely to have
a Material Adverse Effect, and has all requisite corporate, limited liability
company or partnership power and authority to own and operate its properties and
to carry out its business.

(b) Authorization. The execution, delivery and performance by each Loan Party of
the Loan Documents executed by it, and the making of Borrowings hereunder in the
case of the Borrower, are within such Loan Party’s corporate, limited liability
or partnership powers, as applicable, and have been duly authorized by all
necessary corporate, limited liability or partnership action, as applicable.

(c) No Conflict. The execution, delivery and performance by each Loan Party of
the Loan Documents executed by it do not (i) violate such Person’s charter,
by-laws or other organizational document, (ii) violate any law or regulation
(including Regulations T, U and X) applicable to such Person or any order,
judgment or decree of any court or governmental agency body binding on such
Person, (iii) result in a breach of or a default under, or result in or require
the imposition of a Lien pursuant to any contract binding on such Person, except
to the extent the foregoing could not reasonably be expected to have a Material
Adverse Effect, or (iv) violate any material agreement as to which such Person
is a party, except to the extent such violation could not reasonably be expected
to result in the termination of such material agreement or otherwise have a
Material Adverse Effect.

(d) Governmental Consents. No authorization or approval or other action by, and
no notice to or filing with, any governmental authority or regulatory body is
required for the due execution, delivery and performance by any Loan Party of
the Loan Documents, except for filings and recordings with respect to the
Collateral to be made under the Loan Documents.

(e) Validity. Each Loan Document has been duly executed and delivered by each
Loan Party that is a party thereto and constitutes the binding obligations of
each Loan Party that is a party thereto, each enforceable against each Loan
Party that is a party thereto in accordance with their respective terms, except
in each case as such enforceability may be limited by bankruptcy, insolvency,
reorganization, liquidation, moratorium or other similar laws of general
application and equitable principles relating to or affecting creditors’ rights.

 

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(f) Litigation. Except as set forth on Schedule 5.01(f)to the Disclosure Letter,
there is no action or proceeding pending (or threatened in writing) affecting
any Loan Party or any of its Subsidiaries before any court, governmental agency
or arbitrator, which could reasonably be expected to have a Material Adverse
Effect.

(g) Employee Benefit Plans. No Loan Party, (i) sponsors, maintains or
contributes to (or is required to contribute to) any Pension Plans or
(ii) contributes to a Multiemployer Plan or has been required to contribute to a
Multiemployer Plan or Pension Plan in the past six years.

(h) Disclosure. No information, report, financial statement, exhibit or schedule
furnished to the Lender by or on behalf of any Loan Party or any of its
Subsidiaries for use in connection with the transactions contemplated by this
Agreement, taken as a whole, contains any untrue statement of a material fact or
omits to state a material fact necessary in order to make the statements
contained therein (taken as a whole) not misleading in any material respect in
the light of the circumstances in which the same were made; provided that, to
the extent any such information, report, financial statement, exhibit or
schedule was based upon or constitutes a forecast or projection, the Borrower
represents and warrants only that it acted in good faith and utilized reasonable
assumptions (based upon accounting principles consistent with the historical
audited financial statements of the Borrower) and due care in the preparation of
such information, report, financial statement, exhibit or schedule, it being
recognized by the Lender that such information as it relates to future events is
not to be viewed as fact and that actual results during the period or periods
covered by such information may differ materially from the projected results set
forth therein.

(i) Environmental Matters. Each Loan Party and its Subsidiaries are in
compliance with all Environmental Laws and no event or condition has occurred or
is occurring with respect to such Loan Party or any of its Subsidiaries relating
to any Environmental Law that has resulted in or could reasonably be expected to
result in claims alleging potential liability or responsibility for violation of
any Environmental Law or release or injury to the environment, or is or could
reasonably be expected to be the subject of any investigation, proceeding,
settlement, except in each case violations and claims that, individually or in
the aggregate, have not had and could not reasonably be expected to have a
Material Adverse Effect. Such Loan Party and its Subsidiaries have all
Environmental Permits necessary for the ownership and operation of their
respective properties and businesses as presently owned and operated and as
presently proposed to be owned and operated, except for those which are not yet
necessary or the absence of which, individually, or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect. Neither such Loan
Party nor its Subsidiaries has transported or arranged for the transport of any
Hazardous Materials or any other materials subject to Environmental Laws to any
environmental clean-up site which has not been in compliance with Environmental
Laws, except for any noncompliance that, individually or in the aggregate, could
not reasonably be expected to have a Material Adverse Effect.

(j) Title to Properties; Liens; Location of Real Property and Leased Premises.
(i) Each Loan Party and its Subsidiaries have (A) good, sufficient and legal
title to (in the case of fee interests) the real property owned by it, (B) valid
leasehold interests in (in the case of leasehold interests in real property) the
real property leased by it or (C) good title to all of their respective material
personal property. Except as permitted by Section 6.02(a), all such properties
are free and clear of Liens. (ii) Schedule 5.01(j)(ii) to the Disclosure Letter
lists, as of the Closing Date, all real property owned by the Borrower and its
Subsidiaries and the addresses thereof. (iii) Schedule 5.01(j)(iii) to the
Disclosure Letter lists, as of the Closing Date, each parcel of real property
leased, subleased, licensed or sublicensed by the Borrower and its Subsidiaries,
the address and the owner thereof, and the expiration date of the related lease,
sublease, license or sublicense.

 

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(k) Payment of Taxes. All income and other material tax returns and reports of
each Loan Party and its Subsidiaries required to be filed by any of them have
been timely filed (or an extension has been obtained for the filing thereof),
and all taxes shown on such tax returns to be due and payable and all
assessments, fees and other governmental charges upon such Loan Party and its
Subsidiaries and upon their respective properties, assets, income, businesses
and franchises that are due and payable have been paid when due and payable,
except any of the foregoing that are being contested in good faith by
appropriate proceedings and with respect to which reserves or other appropriate
provisions, if any, as shall be required in conformity with GAAP have been made
or provided therefor.

(l) Governmental Regulation. Neither any Loan Party nor any of its Subsidiaries
is subject to regulation under the Investment Company Act of 1940 or under any
other Federal or state statute or regulation which may limit its ability to
incur Debt or which may otherwise render all or any portion of the Obligations
unenforceable. The Borrower is not engaged nor will the Borrower engage,
principally or as one of its important activities, in the business of purchasing
or carrying margin stock (within the meaning of Regulation U issued by the Board
of Governors of the Federal Reserve System of the United States of America) in
violation of Regulation T, U or X.

(m) Licenses and Permits; Intellectual Property. Each Loan Party and its
Subsidiaries own or possess all licenses, permits, franchises, authorizations,
patents, copyrights, service marks, trademarks and trade names, or rights
thereto, necessary for the operation of their businesses, free and clear of all
Liens (other than Permitted Liens) and, except (i) as set forth on Schedule
5.01(m) to the Disclosure Letter, or (ii) as could not reasonably be expected to
have a Material Adverse Effect, without known conflict with the rights of
others. Except (A) as set forth on Schedule 5.01(m) to the Disclosure Letter, or
(B) as could not reasonably be expected to have a Material Adverse Effect,
(i) to the knowledge of such Loan Party, no product of such Loan Party or its
Subsidiaries infringes in any material respect any license, permit, franchise,
authorization, patent, copyright, service mark, trademark, trade name or other
right owned by any other Person and (ii) to the knowledge of such Loan Party,
there is no material violation by any Person of any right of such Loan Party or
any of its Subsidiaries with respect to any patent, copyright, service mark,
trademark, trade name or other right owned or used by such Loan Party or any of
its Subsidiaries.

(n) Labor Disputes; Casualties. Neither any Loan Party nor any of its
Subsidiaries is affected by any fire, explosion, accident, strike, lockout, or
other labor dispute, drought, storm, hail, earthquake, embargo, act of public
enemy or other casualty (whether or not covered by insurance) which,
individually or in the aggregate, has had or could be reasonably expected to
have a Material Adverse Effect.

(o) Compliance. Neither any Loan Party nor any of its Subsidiaries is in default
in the performance of any agreement or instrument to which it is a party or by
which its properties are bound, or in violation of any law, in any case which
defaults and violations, individually or in the aggregate, have had or could
reasonably be expected to have a Material Adverse Effect.

(p) Solvency. The Loan Parties on a consolidated basis are, and, upon the
incurrence of, and after giving effect to, any Obligations under the Loan
Documents by the Loan Parties, will be, Solvent.

 

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(q) Investments. No Loan Party has any investments as described in
Section 6.02(e) in other Persons except investments which would be permitted
under Section 6.02(e).

(r) Debt. No Loan Party has any Debt except Debt which would be permitted under
Section 6.02(b).

(s) Equity Ownership; Subsidiaries. Schedule 5.01(s) to the Disclosure Letter
correctly sets forth the ownership interest of each Subsidiary of the Borrower
as of the Closing Date. As of the Closing Date, the capitalization of the
Borrower’s Subsidiaries consists of the number of Equity Interests, authorized,
issued and outstanding, of such classes and series, with or without par value,
described on Schedule 5.01(s) to the Disclosure Letter. All outstanding Equity
Interests of the Borrower’s Subsidiaries have been duly authorized and validly
issued and are fully paid and nonassessable, in the case of Equity Interests
issued by a corporation, or duly issued and outstanding, in the case of Equity
Interests issued by any other entity, and not subject to any preemptive or
similar rights, except as described on Schedule 5.01(s) to the Disclosure
Letter. As of the Closing Date, there are no outstanding stock purchase
warrants, subscriptions, options, securities, instruments or other rights of any
type or nature whatsoever, which are convertible into, exchangeable for or
otherwise provide for or require the issuance of Equity Interests of any
Subsidiary of the Borrower, except as described on Schedule 5.01(s) to the
Disclosure Letter. All outstanding shares of the Borrower’s capital stock have
been duly authorized and validly issued and are fully paid and nonassessable.

(t) OFAC. Neither any Loan Party nor any of its Subsidiaries (i) is a person
whose property or interest in property is blocked or subject to blocking
pursuant to Section 1 of Executive Order 13224 of September 23, 2011 Blocking
Property and Prohibiting Transactions With Persons Who Commit, Threaten to
Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)), (ii) engages in
dealings or transactions prohibited by Section 2 of such executive order, or is
otherwise associated with any such person in a manner violative of Section 2 or
(iii) is a person on the list of Specially Designated Nationals and Blocked
Persons or subject to the limitations or prohibitions under any other U.S.
Department of Treasury’s OFAC regulation or executive order.

(u) Insurance. Each Loan Party and its properties and businesses, and the
properties and businesses of its Subsidiaries, are insured with financially
sound and reputable insurance companies (which are not Loan Parties or
Affiliates of the Loan Parties) against loss or damage as required by
Section 6.01(e).

(v) Negative Pledge. Neither the Borrower nor any of its Subsidiaries is a party
to or bound by any agreement or undertaking or security which prohibits the
creation or existence of any Lien upon any of its properties or assets or which
requires the grant of security for an obligation if security is granted for the
Obligations, except for (i) this Agreement and the other Loan Documents,
(ii) covenants in Capital Leases and documents creating Liens permitted by
Section 6.02(a) which prohibit further Liens on the properties encumbered
thereby and (iii) any other agreement or undertaking permitted by
Section 6.02(j).

(w) Security Documents. The Security Documents are effective to create in favor
of the Lender a legal, valid and enforceable security interest in the Collateral
described therein (including any proceeds of any item of such Collateral). In
the case of (i) the Pledged Shares described in the Security Agreement, when any
stock certificates or notes, as applicable, representing such Pledged Shares are
delivered to the Lender and (ii) the other Collateral described in the Security
Documents, when a financing statement in appropriate form is filed in the
applicable filing office (which financing statement has been duly completed and
delivered to the Lender), the Lender shall have a fully perfected first priority
Lien on, and security interest in, all right, title and interest of the
applicable Loan Party in such Collateral

 

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(including any proceeds of any item of such Collateral) (in each case, to the
extent a security interest in such Collateral and proceeds can be perfected
through the filing of a financing statement in such filing office or through the
delivery of such Pledged Shares), as security for the Secured Obligations, in
each case prior and superior in right to any other Person, except Liens
expressly permitted by Section 6.02(a).

(x) Sanctions. None of the Borrower or any of its Subsidiaries nor, to the
knowledge of the Borrower, any director, officer, employee, agent or Affiliate
of the Borrower or any of its Subsidiaries is a Person that is, or is owned or
controlled by Persons that are, (i) the subject of any sanctions administered or
enforced by OFAC, the US Department of State, the United Nations Security
Council, the European Union, Her Majesty’s Treasury or the Hong Kong Monetary
Authority (collectively, “Sanctions”), or (ii) located, organized or resident in
a country or territory that is, or whose government is, the subject of
Sanctions, including, without limitation, currently, the Crimea Region, Cuba,
Iran, North Korea, Sudan and Syria.

(y) Anti-Bribery. None of the Borrower, nor to the knowledge of the Borrower,
any director, officer, agent, employee, Affiliate or other person acting on
behalf of the Borrower or any of its Subsidiaries is aware of or has taken any
action, directly or indirectly, that would result in a violation by such persons
of any applicable anti-bribery law, including but not limited to, the United
Kingdom Bribery Act 2010 (the “UK Bribery Act”) and the U.S. Foreign Corrupt
Practices Act of 1977 (the “FCPA”). Furthermore, the Borrower and, to the
knowledge of the Borrower, its Affiliates have conducted their businesses in
compliance with the UK Bribery Act, the FCPA and similar laws, rules or
regulations and have instituted and maintain policies and procedures designed to
ensure, and which are reasonably expected to continue to ensure, continued
compliance therewith.

ARTICLE VI.

COVENANTS

Section 6.01 Affirmative Covenants. So long as the Note or any Obligation (other
than inchoate indemnity obligations) hereunder and under the other Loan
Documents shall remain unpaid or the Lender shall have any Commitment hereunder,
unless the Lender shall otherwise consent in writing:

(a) Financial Information. The Borrower will furnish to the Lender:

(i) as soon as available, but in any event within ninety (90) days after the end
of each Fiscal Year, a copy of the audited consolidated financial statements of
the Borrower and its Subsidiaries as at the end of such Fiscal Year, including a
balance sheet and related statements of income and cash flows, accompanied by a
report and opinion thereon (prepared in accordance with generally accepted
auditing standards) of Ernst & Young LLP or other independent certified public
accountants reasonably acceptable to the Lender (which report and opinion shall
be unqualified as to going concern and scope of audit);

(ii) as soon as available, but in any event within forty-five (45) days after
each of the first three Fiscal Quarters of each Fiscal Year, a copy of the
unaudited consolidated financial statements of the Borrower and its Subsidiaries
for such period;

all such financial statements referred to in clauses (i) – (ii) to fairly
present in all material respects the financial condition and results of
operations of the Borrower and its Subsidiaries and to be in reasonable detail
and in accordance with GAAP (subject in the case of quarterly financials to
changes resulting from normal year-end adjustments and the absence of
footnotes); and

 

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(iii) as soon as available, but in any event within forty-five (45) days after
the end of each Fiscal Quarter, a complete and accurate Accounts Receivable
agings report in form satisfactory to the Lender, calculated as of the last day
of such Fiscal Quarter; and

(iv) as soon as available, but in any event within sixty (60) days after the
beginning of each Fiscal Year, management projected year-end consolidated
financial statements of the Borrower and its Subsidiaries for such Fiscal Year,
including a projected balance sheet and related statements of income and cash
flows and a statement of all the material assumptions on which such projections
are based.

(b) Notices and Information. The Borrower shall deliver to the Lender:

(i) promptly upon any senior officer of the Borrower obtaining actual knowledge
(w) of any condition or event which constitutes an Event of Default or Potential
Event of Default, (x) that any Person has given any notice to any Loan Party or
any of its Subsidiaries or taken any other action with respect to a claimed
default or event or condition of the type referred to in Section 7.01(e), (y) of
the institution of any litigation involving an alleged liability (including
possible forfeiture of property) of any Loan Party or any of its Subsidiaries
equal to or greater than $5,000,000 with respect to any such Person, or any
adverse determination in any litigation involving a potential liability of any
Loan Party or any of its Subsidiaries equal to or greater than $5,000,000 with
respect to any such Person, in each case to the extent not covered by insurance,
or (z) of a condition or events that could reasonably be expected to cause a
Material Adverse Effect, an officers’ certificate specifying the nature and
period of existence of any such condition or event, or specifying the notice
given or action taken by such holder or Person and the nature of such claimed
default, Event of Default, Potential Event of Default, event or condition, and
what action the Borrower or the applicable Subsidiary has taken, is taking and
proposes to take with respect thereto;

(ii) promptly, and in any event within thirty (30) days after receipt thereof, a
copy of any notice, summons, citation, directive, letter or other form of
communication from any governmental authority or court in any way concerning any
action or omission on the part of such Loan Party or any of its Subsidiaries in
connection with any Hazardous Material or any waste or by product thereof, or
concerning the filing of a Lien upon, against or in connection with such Loan
Party or such Subsidiary, or any of their leased or owned real or personal
property, in connection with a Hazardous Substance Superfund or a Post-Closure
Liability Fund as maintained pursuant to Section 9507 of the Internal Revenue
Code, in each case which could reasonably be expected to have a Material Adverse
Effect;

(iii) concurrently with any delivery of financial statements under clause (a)(i)
or (a)(ii) above, a Compliance Certificate duly executed by the Chief Financial
Officer of the Borrower that, among other things, (x) shows in reasonable detail
the calculations used in determining the financial covenants set forth in
Section 6.03(a) and in Section 6.03(b) as of the end of such Fiscal Quarter, as
applicable, and (y) states that no Potential Event of Default or Event of
Default is continuing as of the date of delivery of such Compliance Certificate
or, if a Potential Event of Default or Event of Default is continuing, states
the nature thereof and the action that the Loan Parties propose to take with
respect thereto;

 

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(iv) reserved;

(v) promptly after the same become publicly available, copies of all periodic
and other reports, proxy statements and other materials filed by the Borrower or
any Subsidiary with the SEC, or with any national securities exchange, or
distributed to its stockholders, as the case may be;

(vi) promptly upon receipt thereof, copies of all material reports submitted to
the Borrower by its independent certified public accountants in connection with
each annual audit examination of the Borrower and its Subsidiaries made by such
accountants, including the “management letter” submitted by such accountants to
the Borrower in connection with their annual audit and any written management
responses thereto, and copies of each notice or other correspondence received
from the SEC (or comparable agency in any applicable non-U.S. jurisdiction)
concerning any actual investigation or indicating a likely investigation by such
agency regarding financial or other operational results of the Borrower or any
Subsidiary thereof; and

(vii) promptly, and, to the extent practicable, within ten (10) Business Days
after request by the Lender, such other information and data with respect to the
Borrower or any of its Subsidiaries as from time to time may be reasonably
requested by the Lender.

Documents required to be delivered pursuant to Section 6.01(a)(i) or (ii) or
Section 6.01(b)(v) (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 (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower’s
website on the Internet at;
https://www.boxinvestorrelations.com/financial-information/sec-filings/default.aspx
or (ii) on which such documents are posted on the Borrower’s behalf on an
Internet or intranet website, if any, to which the Lender has access; provided
that: (x) the Borrower shall deliver paper copies of such documents to the
Lender if the Lender so requests until a written request to cease delivering
paper copies is given by the Lender and (y) the Borrower shall notify the Lender
(by facsimile, electronic mail, automatic electronic notification or other form
of notification acceptable to the Lender) of the posting of any such documents.

(c) Corporate Existence. Except as otherwise permitted under Section 6.02(d) or
6.02(f), each Loan Party shall, and shall cause each of its Subsidiaries to, at
all times, preserve and keep in full force and effect (i) its corporate, limited
liability company or partnership, as applicable, existence and (ii) rights and
franchises material to its business; provided that any Subsidiary that is not a
Loan Party may liquidate or dissolve if the Borrower determines in good faith
that such liquidation or dissolution is in the best interests of the Borrower
and is not materially disadvantageous to the Lender.

(d) Payment of Taxes and Claims. Each Loan Party shall, and shall cause each of
its Subsidiaries to, pay all federal income taxes and material state and local
taxes, assessments and other governmental charges imposed upon it or any of its
properties or assets or in respect of any of its franchises, business, income or
property before any penalty or fine accrues thereon, except for any of the
foregoing that are being contested in good faith by appropriate proceedings
promptly instituted and diligently conducted and (i) with respect to which
reserves or other appropriate provisions, if any, as shall be required in
conformity with GAAP have been made or provided therefor and (ii) in the case of
a tax, assessment, or charge which has or may become a Lien against any of the
Collateral, such proceedings conclusively operate to stay the sale of any
portion of the Collateral to satisfy such tax, assessment, or charge.

 

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(e) Maintenance of Properties; Insurance. Except as could not reasonably be
expected to have a Material Adverse Effect, each Loan Party shall, and shall
cause each of its Subsidiaries to, maintain or cause to be maintained in good
repair, working order and condition (other than wear and tear occurring in the
ordinary course of business) all properties used in the business of such Loan
Party and its Subsidiaries and from time to time will make or cause to be made
all appropriate repairs, renewals and replacements thereof which in the exercise
of its reasonable business judgment are required for the continuation of its
business. Each Loan Party will, and will cause each of its Subsidiaries to,
maintain or cause to be maintained, with financially sound and reputable
insurance companies (which are not Affiliates of the Loan Parties), insurance
with respect to its properties and business and the properties and businesses of
its Subsidiaries against loss or damage of the kinds customarily insured against
by corporations of established reputation engaged in the same or similar
businesses and similarly situated, of such types and in such amounts (and with
such deductibles) as are customarily carried under similar circumstances by such
other corporations.

(f) Use of Proceeds. The Borrower shall only use the proceeds of the Loans as
permitted under Section 3.01.

(g) Compliance with Laws, Etc. Each Loan Party shall exercise, and cause each of
its Subsidiaries to exercise, all due diligence in order to comply with the
requirements of all applicable laws, rules, regulations and orders of any
governmental authority, including, without limitation, all Environmental Laws,
noncompliance with which could reasonably be expected to cause, either
individually or in the aggregate, a Material Adverse Effect.

(h) Books and Records. Each Loan Party shall, and shall cause each of its
Subsidiaries to, maintain proper records and accounts in which full, true and
correct entries in conformity with GAAP, consistently applied, shall be made of
its financial transactions and matters involving the assets and business of such
Loan Party and its Subsidiaries.

(i) OFAC, Etc. Without limiting clause (g) above, each Loan Party shall, and
shall cause each of its Subsidiaries to, (i) ensure that no Person who owns a
controlling interest in or otherwise controls a Loan Party is or shall be
(x) listed on the Specially Designated Nationals and Blocked Person List
maintained by OFAC and/or any other similar lists maintained by OFAC pursuant to
any authorizing statute, Executive Order or regulation or (y) a person
designated under Section 1(b), (c) or (d) of Executive Order No. 13224
(September 23, 2001), any related enabling legislation or any other similar
Executive Orders, and (ii) comply with all applicable Bank Secrecy Act and
anti-money laundering laws and regulations.

(j) Payment of Obligations. Each Loan Party shall, and shall cause each of its
Subsidiaries to, pay all obligations and lawful claims (including, without
limitation, claims for labor, services, materials and supplies) that, if unpaid,
would become a Lien for a material amount against any of its properties or
assets, except for any such obligations being contested in good faith by
appropriate proceedings diligently conducted and against which adequate
reserves, if any required under GAAP, have been established, and so long as any
Lien resulting therefrom has not become enforceable or is the subject of
proceedings that operate to stay the enforcement of such Lien.

 

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(k) Material Licenses. Each Loan Party shall, and shall cause each of its
Subsidiaries to, maintain and preserve all licenses, permits (including
Environmental Permits), authorizations and consents from any Person and all
registrations, notices and filings with any Person (i) which if not obtained,
held or made would have a Material Adverse Effect or (ii) that is necessary for
the execution or performance by such Loan Party or such Subsidiary, or the
validity or enforceability against such party, of this Agreement or any other
Loan Document.

(l) Environmental Matters. Except as could not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect, each
Loan Party shall, and shall cause each of its Subsidiaries to, (i) comply, and
cause all lessees and other Persons operating or occupying properties owned or
leased by it to comply, with all Environmental Laws and Environmental Permits,
(ii) obtain and renew all Environmental Permits necessary for its operations and
properties and (iii) conduct any investigation, study, sampling and testing, and
undertake any cleanup, removal, remedial or other action necessary to address
Hazardous Materials at, on, under or emanating from any properties owned or
leased by it in accordance with the requirements of all Environmental Laws.

(m) Subsidiaries. (i) From and after the Closing Date, if the Borrower or any of
its Subsidiaries acquires or creates any Domestic Subsidiary (other than a
Domestic Subsidiary of a Foreign Subsidiary that is a CFC) that is a Material
Subsidiary (and, at the election of the Borrower, any other Domestic
Subsidiary), promptly, and in no event later than twenty (20) Business Days
after such acquisition or creation, notify the Lender of that fact and cause
such Domestic Subsidiary (A) to execute and deliver to the Lender a counterpart
of the Subsidiary Guarantee and the Security Agreement and to take all such
further actions and execute all such further documents and instruments as may be
reasonably requested by the Lender to create in favor of the Lender a valid and
perfected first priority Lien in all of the Collateral of such Domestic
Subsidiary (subject to Permitted Liens), and (B) to execute and deliver to the
Lender such documents and instruments and to take actions comparable to those
described in clauses (ii), (iii), (iv), (v) (vi), (vii), (xii), (xiii), (xiv)
and (xvi) of Section 4.01(a) as the Lender may reasonably request. (ii) For each
Subsidiary acquired or created after the Closing Date, each Loan Party shall
have complied with its obligations under the Security Agreement in respect of
the Equity Interests of such Subsidiary. For the avoidance of doubt, no Foreign
Subsidiary (or Domestic Subsidiary of a Foreign Subsidiary that is a CFC) shall
be required to execute and deliver a Guaranty or Security Agreement, and no
equity interests of a Foreign Subsidiary (or Domestic Subsidiary of a Foreign
Subsidiary that is a CFC) shall be required to be pledged pursuant to the
provisions of the Security Agreement or otherwise, in each case to the extent
material adverse tax consequences to the Borrower could reasonably be expected
to result therefrom, it being understood and agreed that a pledge by the
Borrower or its Domestic Subsidiary of 65% of the voting power and 100% of the
non-voting power of all classes of the Equity Interests of a Foreign Subsidiary
(or Domestic Subsidiary of Foreign Subsidiary that is a CFC) will not cause
material adverse tax consequences to Borrower and a pledge by the Borrower or
its Domestic Subsidiary of more than 65% of the voting power of all classes of
the Equity Interests of a Foreign Subsidiary (or Domestic Subsidiary of a
Foreign Subsidiary that is a CFC) will be deemed to cause material adverse tax
consequences to Borrower.

(n) Employee Benefit Plans. No Loan Party shall, (i) establish a Pension Plan or
(ii) contribute to or become required to contribute to a Multiemployer Plan.

(o) Access to Property and Inspections. Each Loan Party shall, and shall cause
its Subsidiaries to, at the Borrower’s sole cost and expense, permit the Lender
and each of its duly authorized representatives or agents to visit (but only
during normal business hours when no Event of Default has occurred and is
continuing) any of its properties and inspect any of its assets or books and
records, to conduct appraisals and valuations, to examine and make copies of its
books and records, and to discuss its affairs, finances and accounts with, and
to be advised as to the same by, its officers and employees at any such
reasonable times and intervals as the Lender may reasonably request and, so long
as no Event of Default or Potential Event of Default has occurred and is
continuing, with reasonable prior notice to the Borrower; provided that, so long
as no Event of Default or Potential Event of Default has occurred and is
continuing, the Lender shall not request more than one field visit and
examination during any Fiscal Year.

 

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(p) Business Locations. Each Loan Party shall promptly (but in no event more
than thirty (30) days) after adding any new leased business location in the
United States containing any assets (excluding leasehold improvements and any
raw materials related thereto) of any Loan Party with a book value in excess of
$3,000,000 individually for any location or $5,000,000 for all locations with
respect to which the applicable landlord has not executed and delivered a
Landlord Subordination Agreement, notify the Lender of such fact, and, if
requested by the Lender, use its reasonable best efforts to cause the applicable
landlord to enter into a Landlord Subordination Agreement with respect to each
such location as requested by the Lender. For the avoidance of doubt, this
Section 6.01(p) shall not apply to facilities utilized by the Borrower or its
Subsidiaries solely as data centers for its server equipment.

(q) Accounts. Each Loan Party shall maintain its primary U.S. depository and
operating accounts with Lender.

(r) Post-Closing Matters. Execute and deliver the documents and complete the
tasks set forth on Schedule 6.01(r), in each case within the time limits
specified on such schedule.

(s) Further Assurances. Each Loan Party shall execute any and all further
documents, financing statements, agreements and instruments, and take all such
further actions, which the Lender may reasonably request, to cause the Lender to
have at all times a first priority, perfected Lien in the Collateral (subject to
Permitted Liens).

Section 6.02 Negative Covenants. So long as any Note or Obligation (other than
inchoate indemnity obligations) hereunder and under the other Loan Documents
shall remain unpaid or the Lender shall have any Commitment hereunder, without
the written consent of the Lender:

(a) Liens, Etc. Borrower shall not, and shall not permit any of its Subsidiaries
to, create or suffer to exist any Lien upon or with respect to any of its assets
or properties, whether now owned or hereafter acquired, or assign any right to
receive income, in each case to secure any Debt of any Person, other than (in
each case, a “Permitted Lien”):

(i) Liens in favor of the Lender;

(ii) Liens existing on the Closing Date and listed on Schedule 6.02(a) to the
Disclosure Letter and any modifications, replacements, renewals, refinancings or
extensions thereof; provided that the Lien does not extend to any additional
property other than (A) Replacement Assets, and (B) proceeds and products
thereof;

(iii) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other
like Liens arising in the ordinary course of business or by operation of law,
and Liens incurred by the Borrower or such Subsidiary in the ordinary course of
business in connection with worker’s compensation, unemployment insurance and
other types of social security, or to secure the performance of surety and
appeal bonds, deeds, leases (other than Debt), government contracts, bids, trade
contracts, statutory obligations, performance and return of money bonds and
other similar obligations;

(iv) Liens or charges arising in favor of governmental authorities by operation
of law for which no default exists in the payment of the obligations secured
thereby or which are being contested in compliance with Section 6.01(d);

 

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(v) Liens arising under (A) the security documents in respect of Hedge
Agreements permitted under Section 6.02(b)(iii) in favor of the Lender or its
Affiliates and (B) agreements relating to Cash Management Obligations in favor
of the Lender or its Affiliates;

(vi) Capital Leases of, and security interests in, assets acquired, constructed
or improved (whether real or personal, tangible or intangible) by the Borrower
or such Subsidiary after the date hereof, provided that such Liens and the Debt
secured thereby (A) are incurred prior to or within 180 days after such
acquisition or the completion of such construction or improvement, (B) the Debt
secured thereby does not exceed the cost of acquiring, constructing or improving
such assets and is otherwise permitted by Section 6.02(b)(ii), and (C) such
Liens shall not apply to any other property or assets of the Borrower or such
Subsidiary (other than Replacement Assets);

(vii) Liens of landlords and mortgagees of landlords arising by statute;

(viii) judgment Liens securing judgments and other proceedings not constituting
an Event of Default hereunder;

(ix) Liens existing on (A) property acquired by such Loan Party or Subsidiary at
the time of such acquisition or (B) assets of a Person at the time such Person
is acquired, so long as (1) the Lien was not created in contemplation of such
acquisition, (2) the amount of the obligations secured thereby has not been
increased in connection with such acquisition or at any time thereafter (except
in connection with any Permitted Refinancing), (3) any such Lien does not extend
to property not subject to such Lien at the time of such acquisition (other than
improvements thereon and Replacement Assets), any such Lien is applicable only
to specific property, and such Liens are not “blanket” or all asset Liens, and
(4) such Lien secures only (x) those obligations which it secures on the date of
such acquisition or the date such Person is acquired, as the case may be, and
such obligations are otherwise permitted by Section 6.02(b)(vii) and (y) any
Permitted Refinancing of such obligations;

(x) to the extent constituting a Lien, any interest or title of (i) a lessor
under any personal property operating lease entered into in the ordinary course
of business of the Borrower or any Subsidiary and precautionary financing
statement filings relating thereto and (ii) a licensor under any non-exclusive
license entered into in the ordinary course of business of the Borrower or any
Subsidiary;

(xi) zoning restrictions, easements, rights-of-way, restrictions on use of real
property and other similar encumbrances incurred in the ordinary course of
business which, in the aggregate, are not substantial in amount and do not in
any case materially detract from the value of the property subject thereto or
interfere with the ordinary conduct of the business of the Borrower or any of
its Subsidiaries;

(xii) Liens on assets of Foreign Subsidiaries; provided that (A) such Liens do
not extend to, or encumber, assets that constitute Collateral or the Equity
Interests of the Borrower or any of the other Loan Parties, and (B) such Liens
extending to the assets of any Foreign Subsidiary secure only Debt incurred by
such Foreign Subsidiary pursuant to Section 6.02(b)(vi), (vii) or (xi);

 

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(xiii) (A) Liens of a collecting bank arising in the ordinary course of business
under Section 4-210 of the Uniform Commercial Code in effect in the relevant
jurisdiction and (B) Liens arising in the ordinary course of business of any
depositary bank or securities intermediary in connection with statutory, common
law and customary contractual rights of set-off and recoupment with respect to
any deposit account or securities account of the Borrower or any Subsidiary
thereof;

(xiv) Liens on cash pledged to secure (i) obligations in respect of letters of
credit or banker’s acceptances permitted under Section 6.02(b)(x) or (ii) Cash
Management Obligations permitted under Section 6.02(b)(v);

(xv) Liens on proceeds of insurance policies securing the financing of the
premiums with respect thereto;

(xvi) Liens in favor of a seller solely on any cash earnest money deposits made
by the Borrower or any of its Subsidiaries in connection with any letter of
intent or purchase agreement with respect to any Permitted Acquisition or other
investment permitted by Section 6.02(e);

(xvii) leases, non-exclusive licenses, subleases or non-exclusive sublicenses
granted to others that do not interfere in any material respect with the
business of the Borrower and its Subsidiaries, taken as a whole; and

(xviii) other Liens not specifically listed above securing obligations not to
exceed $5,000,000 in the aggregate at any time outstanding.

(b) Debt. Borrower shall not, and shall not permit any of its Subsidiaries to,
create or suffer to exist any Debt, other than:

(i) Debt owed to the Lender;

(ii) Capital Leases and Debt incurred to finance the acquisition, construction
or improvement of any equipment or capital assets in an aggregate principal
amount not to exceed $100,000,000 at any time outstanding;

(iii) obligations (contingent or otherwise) existing or arising under any Hedge
Agreement, provided that if such obligations are not with the Lender or any of
its Affiliates, (x) such obligations are (or were) entered into by such Loan
Party in the ordinary course of business for the purpose of directly mitigating
risks associated with fluctuations in interest rates or foreign exchange rates
and (y) such Hedge Agreement does not contain any provision exonerating the
non-defaulting party from its obligation to make payments on outstanding
transactions to the defaulting party;

(iv) to the extent constituting Debt, investments permitted under
Section 6.02(e), including intercompany Debt of the Borrower and the
Subsidiaries to the extent permitted by Section 6.02(e); provided that any such
Debt that is owed by a Loan Party to a Subsidiary that is not a Loan Party is
subordinated to the Obligations on the terms satisfactory to the Lender;

 

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(v) Cash Management Obligations, provided that if such Cash Management
Obligations are not with the Lender or any of its Affiliates, to the extent
incurred in the ordinary course of business in a manner not prohibited by this
Agreement;

(vi) Debt existing on the date of this Agreement and set forth on Schedule
6.02(b) to the Disclosure Letter, together with any Permitted Refinancing;

(vii) Debt assumed in connection with a Permitted Acquisition, so long as such
Debt (A) does not exceed $5,000,000 in the aggregate at any time outstanding and
(B) was not incurred in contemplation of such Permitted Acquisition;

(viii) Debt under performance bonds, surety bonds, release, appeal and similar
bonds, statutory obligations or with respect to workers’ compensation claims, in
each case incurred in the ordinary course of business;

(ix) Guaranties with respect to Debt permitted by this Section;

(x) Debt in respect of letters of credit or bankers’ acceptances supporting
facility leases in an aggregate principal or face amount not exceeding
$5,000,000 at any time;

(xi) Debt secured by Liens permitted by Sections 6.02(a)(iii), (iv), (vii),
(viii), (x), (xi), and (xiii);

(xii) Debt of the Borrower or any of its Subsidiaries arising from the honoring
by a bank or other financial institution of a check, draft or similar instrument
inadvertently drawn by the Borrower or such Subsidiary in the ordinary course of
business against insufficient funds;

(xiii) Debt in the form of earn-outs in respect of any Permitted Acquisition or
any other investments permitted by Section 6.02(e);

(xiv) Debt owing to any insurance company in connection with the financing of
any insurance premiums permitted by such insurance company in the ordinary
course of business; and

(xv) Debt not otherwise permitted under this Section 6.02(b) in an aggregate
principal amount not to exceed $5,000,000 at any time outstanding for such Loan
Parties and their Subsidiaries taken as a whole.

(c) Restricted Payments. Borrower shall not, and shall not permit any of its
Subsidiaries to, declare or make, or agree to declare or make, directly or
indirectly, any Restricted Payment, or incur any obligation (contingent or
otherwise) to do so; except:

(i) any Subsidiary may declare and pay dividends or make other distributions
ratably to its equity holders;

(ii) payments made or expected to be made by the Borrower in respect of
withholding or similar Taxes payable by any future, present or former employee,
director, manager or consultant and any repurchases of Equity Interests in
consideration of such payments including deemed repurchases in connection with
the exercise of stock options or the vesting of restricted stock awards or
restricted stock units;

 

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(iii) so long as no Event of Default or a Potential Event of Default shall have
occurred and be continuing or would result therefrom, the Borrower may
repurchase its Equity Interests owned by employees of the Borrower or the
Subsidiaries or make payments to employees of the Borrower or the Subsidiaries
upon termination of employment in connection with the exercise of stock options,
stock appreciation rights or similar equity incentives or equity based
incentives pursuant to management or employee incentive plans or in connection
with the death or disability of such employees in an aggregate amount not to
exceed $2,000,000 in any Fiscal Year;

(iv) the Borrower and its Subsidiaries may declare and pay dividends or make
other distributions solely in Qualified Equity Interests of such Person; and

(v) the Borrower may deliver its Equity Interests upon conversation of any
Equity Interest and pay cash solely in lieu of issuing fractional shares in
connection with such conversion.

(d) Consolidation, Merger. The Borrower shall not, and shall not permit its
Subsidiaries to, consolidate with or merge into any other corporation or entity,
except that (i) if at the time thereof and immediately after giving effect
thereto no Event of Default or Potential Event of Default shall have occurred
and be continuing, (x) any Subsidiary may merge into the Borrower in a
transaction in which the Borrower is the surviving corporation, and (y) any
Subsidiary may merge into or consolidate with any other Subsidiary (provided
that if any party to any such transaction is a Loan Party, the surviving entity
of such transaction shall be a Loan Party) and (ii) in connection with a
Permitted Acquisition, any corporation or entity may consolidate with or merge
into any Loan Party or any Loan Party (other than the Borrower) may merge into
any other corporation or entity, provided that such Loan Party shall be the
surviving entity of such merger or consolidation or the surviving entity of such
merger or consolidation shall become a Loan Party promptly following the
consummation thereof, and provided, further, that immediately after the
consummation of such consolidation or merger there shall exist no condition or
event which constitutes an Event of Default or a Potential Event of Default.

(e) Loans, Investments. The Borrower shall not, and shall not permit its
Subsidiaries to, make or permit to remain outstanding any loan or advance to, or
own, purchase or acquire any stock, obligations or securities of or any other
interest in, or make any capital contribution to, any other Person or make any
acquisition of all or substantially all of the stock or assets of any business
or division of a Person through a merger, consolidation or any other combination
with such Person in any transaction or a series of related transactions, except
that the Borrower and such Subsidiary may:

(i) acquire any Cash Equivalents;

(ii) acquire and own stock, securities and other investments received from
customers and suppliers in connection with debts created in the ordinary course
of business owing to such Loan Party or such Subsidiaries;

(iii) endorse negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business;

(iv) consummate a Permitted Acquisition, provided that the aggregate amount of
consideration (other than consideration payable in Qualified Equity Interests)
expended to acquire Persons or assets that do not become Loan Parties or
Collateral, respectively, shall not exceed $10,000,000 during the term of this
Agreement;

 

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(v) maintain the loans, investments and/or liabilities in existence on the date
of this Agreement and set forth on Schedule 6.02(e)(v) to the Disclosure Letter;

(vi) invest in the Equity Interests of the Subsidiaries, provided that (A) any
such investment in the form of Equity Interests held by a Loan Party shall be
pledged pursuant to the Security Agreement (subject to any limitations
applicable to voting stock of a Foreign Subsidiary referred to therein), (B) no
part of any such investment by a Loan Party to a non-Loan Party shall take the
form of a contribution of intellectual property (other than any contribution or
transfer to a Foreign Subsidiary of intellectual property that is necessary to,
or useful in, the business of such Foreign Subsidiary pursuant to the Management
and Services Agreement, the Cost Sharing Agreement or the Platform Contribution
Transaction License Agreement), and (C) the aggregate amount of investments by
the Loan Parties in Subsidiaries that are not Loan Parties (determined without
regard to any write-downs or write-offs of such investments) shall not exceed
$25,000,000 per Fiscal Year;

(vii) reserved;

(viii) make loans or advances made by the Borrower to any Subsidiary and made by
the Borrower or any Subsidiary to the Borrower or any other Subsidiary; provided
that (A) any such loans and advances made by a Loan Party shall be evidenced by
a promissory note pledged to the Lender pursuant to the Security Agreement,
(B) such loans and advances shall be unsecured and, to the extent owed by a Loan
Party to a Person that is not a Loan Party, subordinated to the Obligations
pursuant to a subordination agreement in form and substance satisfactory to the
Lender, and (C) the amount of such loans and advances made by Loan Parties to
Subsidiaries that are not Loan Parties shall be subject to the limitation set
forth in clause (vi) of this Section;

(ix) make investments, loans or advances constituting non-cash consideration
received by the Borrower or any Subsidiary in respect of any Dispositions
permitted under Section 6.02(f);

(x) accounts receivable and extensions of trade credit arising in the ordinary
course of business;

(xi) make investments represented by Hedge Agreements permitted under
Section 6.02(b); and

(xii) maintain deposit and securities accounts to the extent not prohibited by
this Agreement; and

(xiii) make other investments, loans or advances in an aggregate amount not to
exceed $3,000,000 during the term of this Agreement.

For purposes of compliance with this Section 6.02(e), the amount of any
investment (whether an equity investment, loan, guarantee or other investment
governed by this Section 6.02(e)) of any Person shall be the amount actually
invested, without adjustment for subsequent increases or decreases in the value
of such investment less (x) any returns or distributions of capital or repayment
of principal actually received

 

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in cash by such Person with respect thereto, whether by disposition, return on
capital, dividend or otherwise or (y) in the case of any investment by a Loan
Party in any Foreign Subsidiary, as reduced by any cash payments received by
such Loan Party from any Foreign Subsidiary pursuant to the Management and
Services Agreement, the Cost Sharing Agreement or the Platform Contribution
Transaction License Agreement.

(f) Asset Sales. Borrower shall not, and shall not permit its Subsidiaries to,
convey, sell, lease, transfer or otherwise dispose of, in one transaction or a
series of transactions, all or any part of its business, property or assets
outside the ordinary course of business (including stock or other equity of a
Subsidiary), whether now owned or hereafter acquired (a “Disposition”), except
that any Loan Party and any Subsidiary may convey, sell, lease, transfer or
otherwise dispose of business, property or assets (i) that are surplus, obsolete
or otherwise not used or useful in the business of such Loan Party or such
Subsidiary, provided that not less than 75% of the aggregate sale price from
such Disposition shall be paid in cash or credited against the purchase price of
replacement property or other assets useful in the business of Borrower and its
Subsidiaries, (ii) consisting of cash or Cash Equivalents (A) in exchange for
cash or other Cash Equivalents, (B) to a Person that is not an Affiliate of any
Loan Party or such Subsidiary, or (C) to a Person that is an Affiliate of any
Loan Party or such Subsidiary, to the extent permitted by Section 6.02(g) and
not prohibited by any other provision of the Credit Agreement, (iii) in exchange
for other assets comparable or superior as to type, value and quality, as
determined in good faith by Borrower, (iv) between and among the Borrower and
its Subsidiaries, provided that if the transferor in such a transaction is a
Loan Party, then either (x) the transferee must be a Loan Party or (y) the
portion of any such Disposition made for less than fair market value and any
non-cash consideration received in exchange for such Disposition shall in each
case constitute an investment in such Subsidiary restricted by Section 6.02(e)
and must be permitted thereunder; (v) resulting from any casualty, taking or
condemnation of any property of the Borrower or any Subsidiary;
(vi) constituting subleases of office space, for fair market value as determined
by the Borrower in good faith, in the ordinary course of business not
interfering with the ordinary conduct of the business of the Borrower or any of
its Subsidiaries; (vii) to the extent permitted by Section 6.01(c) or Sections
6.02(a), (c) or (e); (viii) constituting sale and leaseback transactions
permitted by Section 6.02(q); (ix) consisting of Inventory in the ordinary
course of business; (x) consisting of the lapse, abandonment or other
Disposition of Intellectual Property, that is in the reasonable business
judgment of the Borrower, no longer used or useful in the conduct of its
business or otherwise uneconomical to prosecute or maintain; (xi) the unwinding
of Hedge Agreement permitted under Section 6.02(b) for aggregate consideration
not exceeding $5,000,000 in the aggregate during any Fiscal Year so long as
(A) at the time of such Disposition, no Event of Default or Potential Event of
Default shall have occurred and be continuing or would result from such
Disposition; (B) not less than 75% of the aggregate sale price from such
Disposition shall be paid in cash, and (C) all such Dispositions shall be for at
least fair market value of the assets or property subject to such Disposition.

(g) Transactions with Affiliates. Except as otherwise permitted by the Loan
Documents, Borrower shall not, and shall not permit its Subsidiaries to, enter
into or permit to exist any transaction (including the purchase, sale, lease or
exchange of any property or the rendering of any service) with any Affiliate of
such Loan Party or its Subsidiaries on terms that are less favorable to such
Loan Party or such Subsidiary than those that could reasonably be expected to be
obtained at the time from Persons who are not such an Affiliate; provided that
this clause (g) shall not prohibit the issuance and sale of Equity Interests to
the extent not otherwise prohibited under the terms of this Agreement.

 

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(h) Conduct of Business. Borrower shall not, and shall not permit its
Subsidiaries to, engage in any business, other than (i) the businesses engaged
in by such Loan Party or such Subsidiaries on the Closing Date; (ii) any
related, ancillary, supplementary or complementary business line; (iii) any
reasonable expansion or extension of any of the foregoing; or (iv) such other
lines of business as may be consented to in writing by the Lender.

(i) Modification of Organizational Documents; Etc. No Loan Party shall permit
its or any of its Subsidiaries’ charter, by-laws or other organizational
documents to be amended or modified in any way unless (i) copies of such
amendment or modification are promptly provided to the Lender, or have been
previously provided to the Lender in accordance with Section 6.01(b), (ii) such
amendment or modification does not adversely affect in any material respect the
interests of the Lender hereunder or at law and (iii) such amendment or
modification is not reasonably likely to have Material Adverse Effect. No Loan
Party shall, and shall not permit any of its Subsidiaries to, change its
jurisdiction of incorporation, formation or organization, as applicable, name or
corporate form without providing ten (10) days’ prior written notice to the
Lender.

(j) Inconsistent Agreements; Negative Pledge. No Loan Party shall, or shall
permit any of its Subsidiaries to, enter into any agreement containing any
provision which would be violated or breached by any Borrowing by the Borrower
hereunder or by the performance by any Loan Party of any of its Obligations
hereunder or under any other Loan Document (including the grant of the Liens in
the Collateral pursuant to the Security Documents). No Loan Party shall or shall
allow any of its Subsidiaries to create or permit to exist or become effective
any encumbrance or restriction on the ability of such Loan Party or any of its
Subsidiaries to create, incur, assume or suffer to exist any Lien in favor of
Lender upon any of its properties or revenues or which requires the grant of any
security for an obligation if security is granted for the Secured Obligations,
except for (i) this Agreement and the other Loan Documents, (ii) covenants in
capital leases and documents creating Liens permitted by Section 6.02(a)
prohibiting further Liens on the properties encumbered thereby and Replacement
Assets, (iii) customary restrictions in leases and other contracts restricting
the assignment or pledge thereof, (iv) any encumbrance or restriction existing
under or by reason of applicable law, regulation or rule, (v) any encumbrance or
restriction with respect to the subletting, assignment or transfer of any
property or asset that is a lease, sublease, license, sublicense, permit,
franchise, conveyance or contract or similar property or asset, (vi) any
encumbrance or restriction existing by virtue of any transfer of, agreement to
transfer, option or right with respect to, or Lien on, any property or assets of
any Loan Party or any Subsidiary thereof not otherwise prohibited by this
Agreement, and customary restrictions contained in purchase agreements and
acquisition agreements to the extent in effect pending the consummation of such
transaction, (vii) restrictions that are binding on a Subsidiary at the time
such Subsidiary first becomes a Subsidiary, so long as such restrictions were
not into solely in contemplation of such Persona becoming a Subsidiary,
(viii) customary restrictions under any arrangement with any governmental
authority imposed on any Foreign Subsidiary in connection with governmental
grants, financial aid, tax holidays or similar benefits or economic interests.
Notwithstanding the foregoing, the Loan Parties shall not grant any Person, or
suffer to exist, control over any deposit accounts or securities accounts, other
than (x) pursuant to control agreements in favor of the Lender or (y) in
connection with Liens permitted pursuant to Sections 6.02(a)(ii), (xiv) and
(xvi) limited solely to deposits and pledges so permitted.

(k) Amendments to Certain Agreements. The Borrower shall not, and shall not
permit any of its Subsidiaries to, amend or otherwise modify, or waive any
rights under, the Management and Services Agreement, the Cost Sharing Agreement
or the Platform Contribution Transaction License Agreement to which such Person
is a party in any manner adverse to the Lender.

(l) Fiscal Year. The Borrower shall not change its Fiscal Year end to a date
other than January 31.

 

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(m) Prepayment and Cancellation of Debt. No Loan Party shall, or shall permit
any of its Subsidiaries to, (i) voluntarily prepay any Debt other than (x) the
Obligations in accordance with the terms of the Loan Documents, (y) Debt
permitted under Section 6.02(b) (provided that any prepayment of Debt that is
subordinated to the Obligations must also be permitted under the terms of the
applicable subordination or intercreditor agreement) and (z) trade payables in
the ordinary course of business, or (ii) cancel any claim or debt owing to it,
except for reasonable consideration determined by the Borrower in good faith or
as permitted by Section 6.02(f).

(n) Certain Equity Securities; Equity Ownership. Neither the Borrower nor any
Subsidiary shall issue any Equity Interest that is not Qualified Equity
Interest. The Borrower shall not cause or suffer to exist a Change in Control.

(o) New Subsidiaries. The Borrower shall not acquire, organize or create any
Subsidiary unless (i) the Borrower complies with Section 6.01(m) hereunder,
(ii) such Subsidiary is wholly owned by the Borrower, directly or indirectly,
and (iii) such Borrower shall have complied with its obligations under the
Security Agreement in respect of the Shares (as defined in the Security
Agreement) of such Subsidiary.

(p) Employee Benefit Plans. No Loan Party shall establish (i) a Pension Plan or
(ii) contribute to or become required to contribute to a Multiemployer Plan.

(q) Sale and Lease-Back Transactions. No Loan Party shall, and shall not permit
any of their Subsidiaries to, enter into any arrangement, directly or
indirectly, with any Person whereby it shall sell or transfer any property, real
or personal, used or useful in its business, whether now owned or hereafter
acquired, and thereafter rent or lease such property or other property which it
intends to use for substantially the same purpose or purposes as the property
being sold or transferred unless any obligations in connection with any Capital
Lease or Liens arising in connection therewith are permitted by Sections 6.02(a)
and 6.02(b), as the case may be.

(r) Sanctions; Anti-Bribery. Borrower will not, directly or, to the Borrower’s
knowledge, indirectly, use the proceeds of the Loans or lend, contribute or
otherwise make available such proceeds to any Subsidiary, joint venture partner
or other Person, (i) to fund any activities or business of or with any Person,
or in any country or territory, that, at the time of such funding, is, or whose
government is, the subject of Sanctions or (ii) in any other manner that would
result in a violation of Sanctions by any Person (including any Person
participating in the Loans, whether as underwriter, advisor, investor or
otherwise). The Borrower will not directly, or to the Borrower’s knowledge,
indirectly, permit any part of the proceeds of the Loans to be used for any
payments that would constitute a violation of any applicable anti-bribery law.

(s) Capital Expenditures. Borrower shall not, and shall not permit any of its
Subsidiaries to, make any Capital Expenditures if at the time of making of such
Capital Expenditure, an Event of Default shall have occurred and is continuing
or would result from such Capital Expenditure.

Section 6.03 Financial Covenants. So long as the Note or any Obligation
hereunder and under the other Loan Documents shall remain unpaid or the Lender
shall have any Commitment hereunder:

(a) Minimum Liquidity. The Borrower shall not permit the Liquidity to be less
than $120,000,000 at any time, measured as of the last day of any Fiscal
Quarter; and

 

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(b) Leverage Ratio. The Borrower shall not permit the Leverage Ratio, measured
quarterly on a trailing 12 months basis, to be greater than the ratios set below
for the corresponding measuring periods:

 

Measuring Period End Date    Leverage Ratio July 31, 2017    4.25 to 1.00
October 31, 2017    4.25 to 1.00 January 31, 2018    3.25 to 1.00 April 30, 2018
   3.25 to 1.00 July 31, 2018    3.25 to 1.00 October 31, 2018    3.25 to 1.00
January 31, 2019    3.25 to 1.00 April 30, 2019    3.00 to 1.00 July 31, 2019   
3.00 to 1.00 October 31, 2019    2.50 to 1.00

January 31, 2020 and each

measuring period thereafter

   2.50 to 1.00

ARTICLE VII.

EVENTS OF DEFAULT

Section 7.01 Events of Default. If any of the following events (each, an “Event
of Default”) shall occur and be continuing:

(a) any Loan Party shall (i) fail to pay any principal hereunder when due,
(ii) fail to pay any interest or other amount payable hereunder or under any
other Loan Documents within three (3) Business Days of the date when due, or
(iii) fail to Cash Collateralize any obligations as required hereunder; or

(b) any representation or warranty made by a Loan Party herein or in any other
Loan Document or by a Loan Party (or any of its officers) in connection with
this Agreement or any other Loan Document shall prove to have been incorrect in
any material respect when made; or

(c) (i) any Loan Party shall fail to perform or observe any term, covenant or
agreement contained in Sections 6.01(b)(i), 6.01(c), 6.01(f), 6.01(q), 6.01(r),
6.02 or 6.03; or (ii) any Loan Party shall fail to perform or observe any term,
covenant or agreement contained in Sections 4.01 or 4.02 of the Security
Agreement on its part to be performed or observed and any such failure shall
remain unremedied for twenty (20) days after the earlier to occur of (A) such
Loan Party obtaining actual knowledge of such failure and (B) such Loan Party’s
receipt of written notice from Lender of such failure; or

 

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(d) any Loan Party shall fail to perform or observe any term, covenant or
agreement contained in this Agreement or any other Loan Document other than
those referred to in clauses (a), (b) and (c) above on its part to be performed
or observed and any such failure shall remain unremedied for thirty (30) days
after the earlier to occur of (i) such Loan Party obtaining actual knowledge of
such failure and (ii) such Loan Party’s receipt of written notice from Lender of
such failure; or

(e) any Loan Party or any of its Subsidiaries shall fail to pay any principal
of, or premium or interest on, any Debt (excluding Debt evidenced by the Loan
Documents) (i) in any amount with respect to any Hedging Obligations or Cash
Management Obligations owing to the Lender or any of its Affiliates, or (ii) in
an aggregate principal amount exceeding $5,000,000 in any other case, when due
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise) and such failure shall continue after the applicable grace period, if
any, specified in the agreement or instrument relating to such Debt, or an event
of default shall occur and be continuing under any agreement or instrument
relating to any such Debt, in each case which shall accelerate the maturity of
such Debt or permit the holder thereof or any trustee or agent for such holder
to cause such Debt to become due and payable prior to its expressed maturity,
provided that this clause shall not apply (1) to secured Debt that becomes due
as a result of the voluntary sale or transfer of the property or assets securing
such Debt, if such sale or transfer is permitted hereunder or (2) termination
events or equivalent events pursuant to the terms of Hedge Agreements not
arising as a result of a default by the Borrower or any Subsidiary thereunder;
or

(f) (i) the Borrower, any other Loan Party or any Material Subsidiary of the
Borrower shall commence any case, proceeding or other action (x) under any
existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it as
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to it or its debts, or (y) seeking appointment of a receiver, trustee, custodian
or other similar official for it or for all or substantially all of its assets,
or the Borrower, any other Loan Party or any Material Subsidiary of the Borrower
shall make a general assignment for the benefit of its creditors, or (ii) there
shall be commenced against the Borrower, any other Loan Party or any Material
Subsidiary of the Borrower any case, proceeding or other action of a nature
referred to in clause (i) above which (x) results in the entry of an order for
relief or any such adjudication or appointment or (y) remains undismissed or
undischarged for a period of sixty (60) days; or

(g) one or more final, non-appealable judgments, attachments or decrees shall be
entered against any Loan Party or any of its Subsidiaries involving in the
aggregate a liability equal to or greater than $5,000,000 with respect to such
Loan Party or such Subsidiary in excess of insurance (as to which a solvent and
unaffiliated insurance company has not denied coverage) or third-party
indemnities (as to which the indemnitor has not denied responsibility) and such
judgments, attachments or decrees shall not have been satisfied, vacated,
dismissed, discharged, or stayed or bonded pending appeal within ninety
(90) days from the entry thereof; or

(h) any Loan Document, for any reason other than satisfaction in full of all
Obligations (other than inchoate indemnity obligations), ceases to be in full
force and effect, is declared null and void, or any Loan Party denies that it
has any further liability under such Loan Document or gives notice to such
effect; or

 

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(i) any Loan Document purporting to grant a Lien to secure any Obligation shall,
at any time after the delivery of such Loan Document, fail to create a valid and
enforceable Lien on any Collateral purported to be covered thereby (except to
the extent terminated in accordance with the terms of this Agreement or any
other Loan Document), or such Lien shall fail or cease to be a perfected Lien on
any Collateral with the priority required in the relevant Loan Document or any
Loan Party shall state in writing that any of the events described in this
clause (i) shall have occurred, except, in each case, if such failure is a
result of the Lender’s action or omission; or

(j) any part of the property of any Loan Party is nationalized, expropriated,
seized or otherwise appropriated, or custody or control of such property or of
such Loan Party is assumed by any governmental authority, unless the same (i) is
not likely to have a Material Adverse Effect or (ii) is being contested in good
faith by appropriate proceedings diligently pursued and a stay of enforcement is
in effect;

THEN (i) upon the occurrence of any Event of Default described in clause
(f) above, the Commitment shall immediately terminate and all Loans and Letters
of Credit hereunder together with accrued interest thereon and all other
Obligations owing under this Agreement, the Note and the other Loan Documents
shall automatically become due and payable and (ii) upon the occurrence of any
other Event of Default, the Lender may, by notice to the Borrower, declare the
Commitment to be terminated forthwith, whereupon the Commitment shall
immediately terminate, and/or, by notice to the Borrower, declare the Loans
hereunder, with accrued interest thereon and all other Obligations owing under
this Agreement, the Note and the other Loan Documents to be due and payable
forthwith, whereupon the same shall immediately become due and payable, and in
each case the Borrower shall be required to immediately Cash Collateralize
(x) the outstanding Hedging Obligations owing to the Lender or any of its
Affiliates in an amount equal to 100% of the aggregate net amount of such
Hedging Obligations and (y) the outstanding Cash Management Obligations owing to
the Lender or any of its Affiliates in an amount equal to 100% of the aggregate
amount of such Cash Management Obligations. Except as expressly provided above
in this Section 7.01, presentment, demand, protest and all other notices of any
kind are hereby expressly waived.

ARTICLE VIII.

MISCELLANEOUS

Section 8.01 Amendments, Etc. No amendment or waiver of any provision of any
Loan Documents, nor consent to any departure by any Loan Party therefrom, shall
in any event be effective unless the same shall be in writing and signed by the
Lender and the applicable Loan Party and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.

Section 8.02 Notices, Etc. Except as otherwise set forth in this Agreement, all
notices and other communications provided for hereunder and under the other Loan
Documents shall be in writing (including email or facsimile communication) and
shall be delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by facsimile or email, (i) if to a Loan Party, to the
attention of the Borrower at the Borrower’s address set forth on the signature
page hereof and (ii) if to the Lender, at the address set forth below or, as to
each party, at such other address as shall be designated by such party in a
written notice to the other parties. All such notices and communications shall
be effective as follows: notices and other communications sent by hand or
overnight courier service, or mailed by certified or registered mail, shall be
deemed to have been given when received; notices and other communications sent
by facsimile shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next business day for the
recipient); and

 

48

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notices delivered by email shall be deemed to have been given when
received. Notwithstanding the foregoing, notices and communications to the
Lender pursuant to Article II shall not be effective until received by the
Lender.

Wells Fargo Corporate Banking – Technology Banking Group

45 Fremont Street, 7th Floor, San Francisco, CA 94105

Phone: 415-222-1183

Email: wendy.y.wong@wellsfargo.com

Attention: Wendy Wong

Section 8.03 Right of Set-off. Upon the occurrence and during the continuance of
any Event of Default, the Lender and each of its Affiliates are hereby
authorized by each Loan Party, at any time and from time to time, without
notice, to the fullest extent permitted by applicable law (a) to set off
against, and to appropriate and apply to the payment of, the obligations and
liabilities of such Loan Party under the Loan Documents (whether matured or
unmatured) any and all amounts owing by the Lender to such Loan Party (whether
payable in Dollars or any other currency, whether matured or unmatured, and, in
the case of deposits, whether general or special, time or demand, provisional or
final and however evidenced), irrespective of whether or not the Lender or any
of its Affiliates shall have made any demand under this Agreement or any other
Loan Document and although such obligations and liabilities of such Loan Party
are owed to a branch, office or Affiliate of the Lender different from the
branch, office or Affiliate holding such deposit or obligated on such amounts,
and (b) pending any such action, to the extent necessary, to hold such amounts
as collateral to secure such obligations and liabilities and to return as unpaid
for insufficient funds any and all checks and other items drawn against any
deposits so held as the Lender in its sole discretion may elect. Each Loan Party
hereby grants to the Lender a security interest in all deposits and accounts
maintained with the Lender or any of its Affiliates to secure the Secured
Obligations. The rights of the Lender and its Affiliates under this Section 8.03
are in addition to other rights and remedies (including other rights of set-off)
which the Lender or its Affiliates may have.

Section 8.04 No Waiver; Remedies. No failure on the part of the Lender to
exercise, and no delay in exercising, any right under any of the Loan Documents
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right under any of the Loan Documents preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.

Section 8.05 Costs and Expenses. Subject to the limitation specified in
Section 2.05(c), the Borrower hereby agrees to pay on demand (a) all reasonable
and documented out-of-pocket costs and expenses of the Lender (including
reasonable and documented out-of-pocket attorneys’ fees and costs) in connection
with the preparation, negotiation, execution and delivery of this Agreement and
the other Loan Documents or (b) all costs and expenses of the Lender (including
attorneys’ fees and costs) in connection with the administration of the Loan
Documents or any amendments, modifications, or waivers of the provisions hereof
or thereof, enforcement (including, without limitation, in appellate,
bankruptcy, insolvency, liquidation, reorganization, moratorium or other similar
proceedings) or restructuring of the Loan Documents (including any amendment,
modification or waiver with respect thereto). This covenant shall survive
termination of this Agreement and the payment of the Obligations.

Section 8.06 Indemnity. Whether or not the transactions contemplated hereby
shall be consummated, the Borrower hereby agrees to indemnify, pay and hold the
Lender, its Affiliates and their respective shareholders, officers, directors,
employees and agents of the Lender (collectively, the “Indemnified Parties”),
harmless from and against any and all claims, liabilities, losses, damages,

 

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penalties, costs and expenses (whether or not any of the foregoing Persons is a
party to any litigation), including, without limitation, attorneys’ fees and
costs and costs of investigation, document production, attendance at a
deposition, or other discovery, with respect to or arising out of this Agreement
or the other Loan Documents or any use of proceeds hereunder, or any exercise by
the Lender of its rights and remedies under this Agreement or, any other Loan
Document, or any claim, demand, action or cause of action being asserted against
any Loan Party, including without limitation with respect to violation of any
Environmental Law or other Law (collectively, the “Indemnified Liabilities”),
provided that the Borrower shall have no obligation hereunder with respect to
Indemnified Liabilities arising from (i) the gross negligence or willful
misconduct of any such Persons or its employees or representatives or (ii) any
breach in bad faith by such Indemnified Party of any Loan Document. No
Indemnified Party shall assert, and each Indemnified Party hereby waives, any
claim based on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to direct or actual damages) (whether or not the
claim therefor is based on contract, tort or duty imposed by any applicable
legal requirement) arising out of, in connection with, as a result of, or in any
way related to, this Agreement or any other Loan Document or any agreement or
instrument contemplated hereby or thereby or referred to herein or therein, the
transactions contemplated hereby or thereby, any Loan or the use of the proceeds
thereof or any act or omission or event occurring in connection therewith, and
each Indemnified Party hereby waives, releases and covenants not to sue upon any
such claim or seek any such damages, whether or not accrued and whether or not
known or suspected to exist in its favor. This covenant shall survive
termination of this Agreement and the payment of the Obligations.

Section 8.07 Assignments and Participations. The Lender may sell, assign,
transfer, negotiate or grant participations to other financial institutions in
all or part of its right and obligations under the Loan Documents (including all
or a portion of its Commitment and the Loans at the time owing to the Lender),
(i) in the case of a sale, assignment or transfer, with the consent of the
Borrower (such consent not to be unreasonably withheld, conditioned or delayed),
provided, that the Borrower’s consent shall not be required (A) at any time that
an Event of Default has occurred and is continuing or (B) in the case of a sale,
assignment or transfer to an Affiliate of the Lender or an Approved Fund of the
Lender, and (ii) in the case of a participation, without the consent of, or
notice to, the Borrower, provided, further, that in each case, any assignee or
transferee agrees to be bound by the terms and conditions of this Agreement; and
provided even further, that, in the case of a participation, (x) the Lender’s
obligations under this Agreement shall remain unchanged, (y) the Lender shall
remain solely responsible to the Borrower for the performance of such
obligations, and (z) the Borrower shall continue to deal solely and directly
with the Lender in connection with the Lender’s rights and obligations under
this Agreement. The Lender may, in connection with any actual or proposed
assignment or participation, disclose to the actual or proposed assignee or
participant, any information relating to the Loan Parties, so long as such
potential participants or assignees comply with the provisions of Section 8.09
related to participants and assignees. No Loan Party shall have the right to
assign its rights hereunder or under any Loan Document or any interest herein or
therein without the prior written consent of the Lender, which consent can be
withheld in the sole discretion of the Lender. “Approved Fund” means any Person
(other than a natural Person) that is (or will be) engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course of its activities and that is
administered or managed by the Lender or an Affiliate of the Lender.

Section 8.08 Limitation on Payments. The parties hereto intend to conform to all
applicable laws limiting the maximum rate of interest that may be charged or
collected by the Lender from the Borrower. Accordingly, notwithstanding any
other provision hereof, the Borrower shall not be required to make any payment
to or for the account of the Lender, and the Lender shall refund any payment
made by the Borrower, to the extent that such requirement or such failure to
refund would

 

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violate or conflict with mandatory and nonwaivable provisions of applicable law
limiting the maximum amount of interest which may be charged or collected by the
Lender from the Borrower. To the fullest extent permitted by law, in any action,
suit or proceeding pertaining to this Agreement, the burden of proof, by clear
and convincing evidence, shall be on the Borrower to demonstrate that this
Section 8.08 applies to limit any obligation of the Borrower under this
Agreement or to require the Lender to make any refund, or claiming that this
Agreement conflicts with any applicable law limiting the maximum rate of
interest that may be charged or collected by the Lender from the Borrower, as to
each element of such claim.

Section 8.09 Disclosure of Information. The Lender may disclose information
relating to any Loan Party or any of their respective businesses, including
information regarding the financial condition and property, and the amount of
Debt owed to the Lender and the terms, conditions and other provisions
applicable thereto to its Affiliates and to any of its partners, directors,
officers, employees, agents, trustees, advisors and representatives, regulatory
authorities (including self-regulatory), assignees or participants or
prospective assignees or participants, provided that each such Person shall be
informed of the confidential nature of such information and instructed to keep
such information confidential, and in the case of assignees or participants or
prospective assignees or participants, such Persons shall have executed and
delivered in favor of the Borrower a confidentiality agreement in reasonable and
customary form.

Section 8.10 Limitation of Liability. TO THE FULLEST EXTENT PERMITTED BY LAW, NO
CLAIM MAY BE MADE BY ANY PARTY TO ANY LOAN DOCUMENT AGAINST THE OTHER PARTY
HERETO OR ANY AFFILIATE, DIRECTOR, OFFICER, EMPLOYEE, ATTORNEY OR AGENT OF SUCH
OTHER PARTY FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES IN
RESPECT OF ANY CLAIM ARISING FROM OR RELATING TO THIS AGREEMENT OR, ANY OTHER
LOAN DOCUMENT OR ANY STATEMENT, COURSE OF CONDUCT, ACT, OMISSION OR EVENT IN
CONNECTION WITH ANY OF THE FOREGOING (WHETHER BASED ON BREACH OF CONTRACT, TORT
OR ANY OTHER THEORY OF LIABILITY); AND EACH PARTY HEREBY WAIVES, RELEASES AND
AGREES NOT TO SUE UPON ANY CLAIM FOR ANY SUCH DAMAGES, WHETHER OR NOT ACCRUED
AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST.

Section 8.11 Effectiveness; Binding Effect; Governing Law. This Agreement shall
become effective when it shall have been executed by the Borrower and the Lender
and thereafter shall be binding upon and inure to the benefit of the Borrower,
the Lender and their respective successors and assigns (subject to
Section 8.07). THIS AGREEMENT AND THE NOTE SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA WITHOUT GIVING EFFECT TO
ITS CHOICE OF LAW PRINCIPLES WHICH WOULD RESULT IN THE APPLICATION OF THE LAW OF
ANOTHER JURISDICTION.

Section 8.12 Waiver of Jury Trial. THE BORROWER HEREBY AGREES TO WAIVE ITS
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS BETWEEN THE
BORROWER AND THE LENDER RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION
OR THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED.

Section 8.13 Consent to Jurisdiction; Venue. All judicial proceedings brought
against a Loan Party with respect to this Agreement or the other Loan Documents
may be brought in any state or federal court of competent jurisdiction in the
State of California, and by execution and delivery of this Agreement, each Loan
Party hereby accepts for itself and in connection with its properties,

 

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generally and unconditionally, the exclusive jurisdiction of the aforesaid
courts, and each Loan Party hereby irrevocably agrees to be bound by any
judgment rendered thereby in connection with this Agreement and the other Loan
Documents. Each Loan Party hereby irrevocably waives any right it may have to
assert the doctrine of forum non conveniens or to object to venue to the extent
any proceeding is brought in accordance with this Section 8.13. Nothing in this
Agreement or in any other Loan Document shall affect any right that the Lender
may otherwise have to bring any action or proceeding relating to any Loan
Document against any Loan Party or its property in the courts of any
jurisdiction.

Section 8.14 Entire Agreement. This Agreement with all Exhibits and Schedules
hereto and the other Loan Documents embody the entire agreement and
understanding by and among the parties hereto and thereto relating to the
subject matter hereof and thereof and supersedes any and all prior agreements
and understandings, oral or written, relating to the subject matter hereof and
thereof.

Section 8.15 Separability of Provisions; Headings. In case any one or more of
the provisions contained in this Agreement should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not in any way be affected or
impaired thereby. Section headings in this Agreement are included for
convenience of reference only and shall not be given any substantive effect.

Section 8.16 Execution in Counterparts; Etc. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of this Agreement by facsimile or other
electronic method of transmission shall be equally as effective as delivery of
an original executed counterpart of this Agreement.

Section 8.17 USA Patriot Act. The Lender hereby notifies the Loan Parties that
pursuant to the requirements of the Patriot Act it is required to obtain, verify
and record information that identifies the Loan Parties, which information
includes the name and address of the Loan Parties and other information that
will allow the Lender to identify the Loan Parties in accordance with the
Patriot Act.

Section 8.18 English Language. This Agreement and each of the other Loan
Documents has been negotiated and executed in the English language. Except as
specified otherwise herein all certificates, reports, notices and other
documents and communications given or delivered pursuant to this Agreement and
the other Loan Documents (including any modifications or supplements hereto or
thereto) shall be in the English language, or accompanied by an English
translation.

Section 8.19 Service of Process. Each party hereto irrevocably consents to
service of process in the manner provided for notices in Section 8.02. Nothing
in this Agreement will affect the right of any party hereto to serve process in
any other manner permitted by applicable laws.

[remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

 

BORROWER: BOX, INC. By:   /s/ Dylan Smith Name: Dylan Smith Title: Chief
Financial Officer Address:     900 Jefferson Ave   Redwood City, CA 94063  
Phone: (877) 729-4269   Facsimile: (888) 418-6762   Attention: Chief Financial
Officer

[Signature Page to Credit Agreement]

--------------------------------------------------------------------------------

LENDER: WELLS FARGO BANK, NATIONAL ASSOCIATION By:   /s/ Wendy Wong Name:  
Wendy Wong Title:   VP

[Signature Page to Credit Agreement]

--------------------------------------------------------------------------------

EXHIBIT A

FORM OF NOTICE OF BORROWING

Dated:                     

Pursuant to that certain Credit Agreement dated as of November         , 2017
(as supplemented, amended, modified, amended and restated or replaced in writing
from time to time, the “Credit Agreement”, the terms defined therein and not
otherwise defined herein being used herein as therein defined), by and between
BOX, INC., a Delaware corporation (the “Borrower”), and WELLS FARGO BANK,
NATIONAL ASSOCIATION (the “Lender”), this represents Borrower’s request to
borrow as follows:

 

  1. Date of Borrowing:                                          
                            

 

  2. Amount of Borrowing: $                                          
                   

 

  3. Interest Rate:  [Prime Rate]  [LIBOR]

 

  4. For LIBOR Loans – Interest Period:   [one]   [three]   [ six] month(s)

The undersigned officer, to the best of his or her knowledge, certifies that:

 

  (i) the representations and warranties contained in the Credit Agreement and
the other Loan Documents are true, correct and complete in all material respects
(or, in the case of any such representation or warranty already qualified by
materiality or reference to Material Adverse Effect, in all respects) on and as
of the date hereof as though made on and as of the date hereof, except to the
extent such representations and warranties specifically relate to an earlier
date, in which case such representations and warranties were true, correct and
complete in all material respects (or, in the case of any such representation or
warranty already qualified by materiality or reference to Material Adverse
Effect, in all respects) on and as of such earlier date;

 

  (ii) no event or condition has occurred and is continuing or would result from
the Borrowing contemplated hereby that would constitute an Event of Default or a
Potential Event of Default; and

 

  (iii) all Loan Documents are in full force and effect.

[Balance of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the Borrower has caused this Notice of Borrowing to be
executed and delivered by its duly authorized officer, as of the date and the
place first above written.

 

BOX, INC. By:  

 

Name:  

 

Title:  

 

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EXHIBIT B

COMPLIANCE CERTIFICATE

                             , 201    

THE UNDERSIGNED HEREBY CERTIFIES AS FOLLOWS:

 

  1. I am the Chief Financial Officer of BOX, INC. (the “Borrower”).

 

  2. Reference is made to that certain Credit Agreement dated as of November 27,
2017 (as supplemented, amended, modified, amended and restated or replaced in
writing from time to time, the “Credit Agreement”, the terms defined therein and
not otherwise defined herein being used herein as therein defined), by and
between BOX, INC., a Delaware corporation (the “Borrower”), and WELLS FARGO
BANK, NATIONAL ASSOCIATION (the “Lender”). All terms used but not otherwise
defined herein shall have the meanings set forth in the Credit Agreement.

 

  3. [No Potential Event of Default or Event of Default is continuing as of the
date of delivery of this Compliance Certificate.]

 

     [OR]

 

     [A Potential Default or Event of Default is continuing as of the date of
delivery of this

 

     Compliance Certificate. The nature of such Potential Default or Event of
Default is                                     . The action that the Borrower
proposes to take with respect thereto is                                     .]

 

  4. Attached hereto as Annex A are the calculations used in determining the
financial covenants set forth in Section 6.03(a) and Section 6.03(b) of the
Credit Agreement, in each case, as of the date of this Compliance Certificate.

The foregoing certifications, together with the computations set forth in Annex
A hereto are made and delivered as of the date first set forth above pursuant to
the Credit Agreement.

 

BOX, INC.

By:  

 

Name:  

 

Title:  

 

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ANNEX A

To Compliance Certificate

 

I. Section 6.03(a) – Minimum Liquidity

     

a. Liquidity

     

i.       Amount without duplication of Eligible Accounts Receivable of the
Borrower (on a consolidated basis) at such time:

      $                    

ii.      Amount of Unrestricted Cash of the Borrower and any other Loan Part at
such time:

      $                    

1.      Unrestricted cash, plus

      $  

2.      unrestricted Cash Equivalents, in each case, of the Borrower and any
other Loan Party in deposit or securities accounts (or any combination thereof)
held with the Lender or any of its Affiliates, or with any other financial
institution, with respect to which the Lender has received an account control
agreement over such account

      $  

b. The sum of Line I.a.i and Line I.a.ii

      $                    

c. Minimum required at all times:

      $120,000,000

II. Section 6.03(b) – Leverage Ratio

     

a. Borrower’s total Debt:

     

i.       Outstanding SBLCs issued under the Agreement

      $                    

ii.      Debt outstanding under the Agreement

      $                    

iii.    Capital Leases

      $                    

iv.     Without duplication, Line II.a.i plus Line II.a.ii plus Line II.a.iii

      $                    

b. Borrower’s EBITDA:

     

i.       Consolidated Net Income:

      $                    

ii.      Add-backs:

     

1.      Depreciation and amortization:

      $                    

2.      Provision (benefits) for income tax

      $                    

3.      Consolidated Total Interest Expense

      $                    

4.      Non-cash expenses, losses and charges, including, without limitation,
non-cash compensation-based expenses:

      $                    

5.      Extraordinary, unusual or non-recurring expenses, losses and charges,
including, without limitation, restructuring charges and costs, fees and
expenses incurred by Borrower or its Subsidiaries in connection with any
Permitted Acquisition

      $                    

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6.      Other expenses, losses or charges agreed to by the Lender:

      $                    

7.      Total adjustments (sum of Line II.b.ii.1 through Line II.b.ii.6)

      $                    

iii.    Average Deferred Revenue Change

      $                    

iv.     Adjusted EBITDA (Line II.b.i plus Line II.b.ii.7 plus Line II.b.iii)

      $                    

c. Line II.a.iv divided by Line II.b.iv:

                     : 1.0

d. Minimum required amounts set forth below:

     

 

Measuring Period End Date            Leverage Ratio             July 31, 2017   
4.25 to 1.00     October 31, 2017    4.25 to 1.00     January 31, 2018    3.25
to 1.00     April 30, 2018    3.25 to 1.00     July 31, 2018    3.25 to 1.00    
October 31, 2018    3.25 to 1.00     January 31, 2019    3.25 to 1.00    
April 30, 2019    3.00 to 1.00     July 31, 2019    3.00 to 1.00     October 31,
2019    2.50 to 1.00    

January 31, 2020 and each

measuring period thereafter

   2.50 to 1.00    

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EXHIBIT C

FORM OF NOTE

$ 85,000,0000

FOR VALUE RECEIVED, BOX, INC., a Delaware corporation (the “Borrower”), hereby
promises to pay to WELLS FARGO BANK, NATIONAL ASSOCIATION or its registered
assigns (the “Lender”), the principal amount of Eighty-Five Million Dollars
($85,000,000.00) or, if less, the aggregate amount of the Loans pursuant to the
Commitment (each as defined in the Credit Agreement referred to below) made by
the Lender pursuant to the Credit Agreement dated as of November     , 2017 by
and between the Borrower and the Lender (as supplemented, amended, modified,
amended and restated or replaced in writing from time to time the “Credit
Agreement”; capitalized terms used herein but not otherwise defined shall have
the meanings set forth in the Credit Agreement) outstanding on the Maturity
Date.

The Borrower also promises to pay interest on the unpaid principal amount hereof
from the date hereof until paid at the rates and at the times which shall be
determined in accordance with the provisions of the Credit Agreement.

All payments of principal and interest in respect of this Note shall be made in
Dollars in same day funds at the office of the Lender described in the Credit
Agreement. Until notified of the transfer of this Note, the Borrower shall be
entitled to deem the Lender or such person who has been so identified by the
transferor in writing to the Borrower as the holder of this Note, as the owner
and holder of this Note. The Lender may attach schedules to this Note and
endorse thereon the date, amount, and payments with respect thereto. Any failure
to attach schedules or make such endorsements to this Note shall not limit or
otherwise affect the obligation of the Borrower hereunder with respect to
payments of principal or interest on this Note.

This is the Note referred to in the Credit Agreement, and this Note is entitled
to the benefits of the Credit Agreement and is secured by the Collateral. The
Credit Agreement, among other things, contains provisions for acceleration of
the maturity hereof upon the happening of certain stated events and also for
prepayments on account of principal hereof prior to the maturity hereof upon the
terms and conditions therein specified.

No reference herein to the Credit Agreement and no provision of this Note or the
Credit Agreement shall alter or impair the obligations of the Borrower, which
are absolute and unconditional, to pay the principal of and interest on this
Note at the place, at the respective times and in the currency herein
prescribed.

The Borrower hereby promises to pay on demand all costs and expenses of the
Lender required by Section 8.05 of the Credit Agreement. The Borrower hereby
consents to renewals and extensions of time at or after the maturity hereof,
without notice, and hereby waives diligence, presentment, protest, demand and
notice of every kind and, to the full extent permitted by law, the right to
plead any statute of limitations as a defense to any demand hereunder.

To the extent of any inconsistency between the terms and conditions of this Note
and the terms and conditions of the Credit Agreement, the terms and conditions
of the Credit Agreement shall control.

This Note may be transferred only in accordance with Section 8.07 of the Credit
Agreement.

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ITS CHOICE OF LAW PRINCIPLES
WHICH WOULD RESULT IN THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION.

[Balance of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and
delivered by its duly authorized officer, as of the date and the place first
above written.

 

BOX, INC. By:     Name:     Title:    

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EXHIBIT D

Form of Subsidiary Guarantee

[See attached.]

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FORM OF SUBSIDIARY GUARANTEE

This SUBSIDIARY GUARANTEE is dated as of                 , 2017 (this
“Agreement”), by                                 , a                      and
each other present or future Domestic Subsidiary of the Borrower that becomes a
party hereto after the date hereof (each, a “Guarantor” and collectively, the
“Guarantors”), in favor of WELLS FARGO BANK, NATIONAL ASSOCIATION (the
“Lender”).

To induce the Lender from time to time to extend credit and other financial
accommodations to BOX, INC., a Delaware corporation (the “Borrower”), pursuant
to that certain Credit Agreement dated as of November __, 2017 between the
Borrower and the Lender (as supplemented, amended, modified, amended and
restated or replaced in writing from time to time the “Credit Agreement”;
capitalized terms used but not otherwise defined herein have the meanings set
forth in the Credit Agreement) and the other Loan Documents, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each Guarantor has agreed to guarantee the Guaranteed Obligations
(as hereinafter defined). Accordingly, the parties hereto agree as follows:

Section 1. The Guarantee.

1.01 The Guarantee. Each Guarantor hereby jointly and severally, and absolutely
and unconditionally, guarantees to the Lender and its respective successors and
assigns the prompt payment in full when due (whether at stated maturity, by
acceleration or otherwise and at all times thereafter) of all Guaranteed
Obligations. Each Guarantor hereby further jointly and severally agrees that if
the Borrower shall fail to pay in full when due (whether at stated maturity, by
acceleration or otherwise) any of the Guaranteed Obligations, such Guarantor
will promptly pay the same, without any demand or notice whatsoever, and that in
the case of any extension of time of payment or renewal of any of the Guaranteed
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, by acceleration or otherwise) in accordance with the terms of
such extension or renewal. “Guaranteed Obligations” shall mean, collectively,
(a) the Obligations, (b) all Hedging Obligations permitted under the Credit
Agreement owing to the Lender or any of its Affiliates, and (c) all Cash
Management Obligations permitted under the Credit Agreement owing to the Lender
or any of its Affiliates, provided that “Guaranteed Obligations” shall not, as
to any Guarantor, include any Excluded Swap Obligations of such Guarantor.

1.02 Obligations Unconditional. The obligations of each Guarantor under
Section 1.01 are absolute and unconditional, joint and several, irrespective of
the value, genuineness, validity, regularity or enforceability of any agreement
or instrument under which any Guaranteed Obligations have been incurred (herein,
the “Underlying Instruments”), or any substitution, release or exchange of any
other guarantee of or security for any of the Guaranteed Obligations, and, to
the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever that might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor, it being the intent of this
Section 1.02 that the obligations of such Guarantor hereunder shall be absolute
and unconditional, joint and several, under any and all circumstances. Without
limiting the generality of the foregoing, it is agreed that the occurrence of
any one or more of the following shall not alter or impair the liability of any
Guarantor hereunder which shall remain absolute and unconditional as described
above:

(i) at any time or from time to time, without notice to any Guarantor, the time
for any performance of or compliance with any of the Guaranteed Obligations
shall be extended, or such performance or compliance shall be waived;

(ii) the maturity of any of the Guaranteed Obligations shall be accelerated, or
any of the Guaranteed Obligations shall be modified, supplemented or amended in
any respect, or any right under any Underlying Instrument shall be waived or any
other guarantee of any of the Guaranteed Obligations or any security therefor
shall be released or exchanged in whole or in part or otherwise dealt with;

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(iii) any lien or security interest granted to, or in favor of, the Lender as
security for any of the Guaranteed Obligations shall fail to be perfected; or

(iv) any other guarantee provided to, or in favor of, the Lender to guarantee
the Guaranteed Obligations shall fail to be enforceable.

Each Guarantor hereby expressly waives diligence, presentment, demand of
payment, protest and all notices whatsoever, and any requirement that the Lender
exhaust any right, power or remedy or proceed against the Borrower under any
Underlying Instrument, or against any other Person under any other guarantee of,
or security for, any of the Guaranteed Obligations. As used in this paragraph,
any reference to “the principal” is a reference to the Borrower, and any
reference to “the creditor” is a reference to the Lender. In accordance with
Section 2856 of the California Civil Code (a) each Guarantor waives any and all
rights and defenses available to it by reason of Sections 2787 to 2855,
inclusive, of the California Civil Code, including without limitation any and
all rights or defenses such Guarantor or any other guarantor of the Guaranteed
Obligations may have because the Guaranteed Obligations are secured by real
property. This means, among other things: (1) the creditor may collect from such
Guarantor without first foreclosing on any real or personal property collateral
pledged by the principal; and (2) if the creditor forecloses on any real
property collateral pledged by the principal: (A) the amount of the Guaranteed
Obligations may be reduced only by the price for which the collateral is sold at
the foreclosure sale, even if the collateral is worth more than the sale price
and (B) the creditor may collect from such Guarantor even if the creditor, by
foreclosing on the real property collateral, has destroyed any right such
Guarantor may have to collect from the principal. This is an unconditional and
irrevocable waiver of any right and defenses such Guarantor may have because the
Guaranteed Obligations are secured by real property. These rights and defenses
include, but are not limited to, any rights and defenses based upon
Section 580a, 580b, 580d, or 726 of the California Code of Civil Procedure. Each
Guarantor also waives all rights and defenses arising out of an election of
remedies by the creditor, even though that election of remedies, such as a
nonjudicial foreclosure with respect to security for a Guaranteed Obligation,
has destroyed such Guarantor’s rights of subrogation and reimbursement against
the principal by the operation of Section 580d of the Code of Civil Procedure or
otherwise; and even though that election of remedies by the creditor, such as
nonjudicial foreclosure with respect to security for an obligation of any other
guarantor of any of the Guaranteed Obligations, has destroyed such Guarantor’s
rights of contribution against such other guarantor. No other provision of this
Agreement shall be construed as limiting the generality of any of the covenants
and waivers set forth in this paragraph. As provided below, this Agreement shall
be governed by, and shall be construed and enforced in accordance with, the
internal laws of the State of California, without regard to conflicts of laws
principles.

1.03 Reinstatement. The obligations of each Guarantor under this Section 1 shall
be automatically reinstated if and to the extent that for any reason any payment
by or on behalf of the Borrower in respect of the Guaranteed Obligations is
rescinded or must be otherwise restored by any holder of any of the Guaranteed
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise.

1.04 Subrogation. Each Guarantor hereby jointly and severally agrees that until
the payment and satisfaction in full of all Obligations (other than contingent
indemnification obligations in respect of which no claim for payment has been
made or no notice for indemnification has been issued by the indemnitee), and
the expiration or termination of the Commitment and all other obligations of the
Lender to make financial accommodations available to the Borrower under the
Underlying Instruments, it subordinates and agrees not to enforce any claim,
right or remedy arising by reason of any performance by it of the guarantee in
this Section 1, whether by subrogation or otherwise, in each case, whether such
claim, right or remedy arises in equity, under contract, by statute (including
without limitation under California Civil Code Section 2847, 2848 or 2849),
under common law or otherwise, against the Borrower, or any other guarantor of
any of the Guaranteed Obligations or any security for any of the Guaranteed
Obligations.

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1.05 Remedies. Each Guarantor hereby jointly and severally agrees that, if any
Guarantor fails to fulfill its duty to pay all Guaranteed Obligations guaranteed
hereunder when due (whether at stated maturity, by acceleration or otherwise and
at all times thereafter), the Lender shall have all of the remedies of a
creditor and, to the extent applicable, of a secured party, under the Loan
Documents and all applicable law.

1.06 Instrument for the Payment of Money. Each Guarantor hereby acknowledges
that the guarantee in this Section 1 constitutes an instrument for the payment
of money, and consents and agrees that the Lender, at its sole option, in the
event of a dispute by such Guarantor in the payment of any moneys due hereunder,
shall have the right to bring motion action under California Code of Civil
Procedure section 437c(a).

1.07 Continuing Guarantee. The guarantee in this Section 1 is a continuing
guarantee, and shall apply to all Guaranteed Obligations whenever arising. Each
Guarantor irrevocably waives any right (including without limitation any such
right arising under California Civil Code Section 2815) to revoke this Agreement
as to future transactions giving rise to any Guaranteed Obligations.

Section 2. Miscellaneous.

2.01 Notices. All notices, requests, consents and demands hereunder shall be
delivered as set forth in Section 8.02 of the Credit Agreement.

2.02 No Waiver. No failure on the part of the Lender to exercise, and no delay
in exercising, any right under any of the Loan Documents shall operate as a
waiver thereof; nor shall any single or partial exercise of any right under any
of the Loan Documents preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein are cumulative and are not
exclusive of any remedies provided by law.

2.03 Amendments, Etc. No amendment or waiver of any provision of this Agreement,
nor consent to any departure by any Guarantor herefrom, shall be in any event
effective unless the same shall be in writing and signed by the Lender and the
applicable Guarantor and then such amendment, waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.

2.04 Costs and Expenses. Each Guarantor hereby jointly and severally agrees to
pay on demand all costs and expenses of the Lender under Section 8.05 of the
Credit Agreement. This covenant shall survive termination of this Agreement and
payment of the Guaranteed Obligations.

2.05 Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the respective successors and assigns of the Guarantors and the
Lender, provided that no Guarantor shall assign or transfer its rights or
obligations hereunder without the prior written consent of the Lender, which
consent can be withheld in the sole and absolute discretion of the Lender.

2.06 Execution in Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of this Agreement by facsimile or other electronic method of
transmission shall be equally as effective as delivery of an original executed
counterpart of this Agreement.

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2.07 Governing Law; Submission to Jurisdiction; Etc.

(a) Effectiveness; Binding Effect; Governing Law. This Agreement shall become
effective when executed by the Guarantors and the Lender and thereafter shall be
binding upon and inure to the benefit of the Guarantors, the Lender and their
respective successors and assigns (subject to Section 2.05). THIS AGREEMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
CALIFORNIA WITHOUT GIVING EFFECT TO ITS CHOICE OF LAW PRINCIPLES WHICH WOULD
RESULT IN THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION.

(b) Consent to Jurisdiction; Venue. All judicial proceedings brought against any
Guarantor with respect to this Agreement may be brought in any state or federal
court of competent jurisdiction in the State of California, and by execution and
delivery of this Agreement, each Guarantor hereby accepts for itself and in
connection with its properties, generally and unconditionally, the exclusive
jurisdiction of the aforesaid courts, and each hereby irrevocably agrees to be
bound by any judgment rendered thereby in connection with this Agreement. Each
Guarantor hereby irrevocably waives any right it may have to assert the doctrine
of forum non conveniens or to object to venue to the extent any proceeding is
brought in accordance with this Section 2.07. Nothing in this Agreement or in
any other Loan Document shall affect any right that the Lender may otherwise
have to bring any action or proceeding relating to any Loan Documents against
any Guarantor or its property in the courts of any jurisdiction.

(c) Service of Process. Each Guarantor hereby irrevocably consents to service of
process in the manner provided in Section 8.19 of the Credit Agreement.

2.08 Fraudulent Conveyance. Anything contained in this Agreement to the contrary
notwithstanding, the obligations of each Guarantor under this Agreement and the
other Loan Documents shall be limited to a maximum aggregate amount equal to the
largest amount that would not render its obligations hereunder subject to
avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11
of the United States Code or any applicable provisions of comparable state law
(collectively, the “Fraudulent Transfer Laws”), in each case after giving effect
to all other liabilities of such Guarantor, contingent or otherwise, that are
relevant under the Fraudulent Transfer Laws (specifically excluding, however,
any liabilities of such Guarantor (x) in respect of intercompany indebtedness to
the Borrower or other affiliates of the Borrower to the extent that such
indebtedness would be discharged in an amount equal to the amount paid by such
Guarantor hereunder and (y) under any guaranty of subordinated indebtedness
which guaranty contains a limitation as to maximum amount similar to that set
forth in this Section 2.08, pursuant to which the liability of such Guarantor
hereunder is included in the liabilities taken into account in determining such
maximum amount) and after giving effect as assets to the value (as determined
under the applicable provisions of the Fraudulent Transfer Laws) of any rights
to subrogation, reimbursement, indemnification or contribution of such Guarantor
pursuant to applicable law or pursuant to the terms of any agreement.

2.09 Keepwell. Each Qualified ECP Guarantor (as hereinafter defined) hereby
jointly and severally absolutely, unconditionally and irrevocably undertakes to
provide such funds or other support as may be needed from time to time by each
other Guarantor to honor all of its obligations under this Agreement in respect
of Swap Obligations (provided, however, that each Qualified ECP Guarantor shall
only be liable under this Section 2.09 for the maximum amount of such liability
that can be hereby incurred without rendering its obligations under this
Section 2.09, or otherwise under this Agreement, voidable under applicable law
relating to fraudulent conveyance or fraudulent transfer, and not for any
greater amount). The obligations of each Qualified ECP Guarantor under this
Section 2.09 shall remain in full force and effect until all of the Guaranteed
Obligations (other than contingent indemnification obligations in respect of
which no claim for payment has been made or no notice for indemnification has

--------------------------------------------------------------------------------

been issued by the indemnitee) shall have been paid in full and the Commitment
terminated. Each Qualified ECP Guarantor intends that this Section 2.09
constitutes, and this Section 2.09 shall be deemed to constitute, a “keepwell,
support, or other agreement” for the benefit of each other Guarantor for all
purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act. “Qualified
ECP Guarantor” means, in respect of any Swap Obligation, each Guarantor that has
total assets exceeding $10,000,000 at the time the relevant guarantee or grant
of the relevant security interest becomes effective with respect to such Swap
Obligation or such other person as constitutes an “eligible contract
participant” under the Commodity Exchange Act or any regulations promulgated
thereunder and can cause another person to qualify as an “eligible contract
participant” at such time by entering into a keepwell under
Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

2.10 Waiver of Jury Trial. EACH PARTY HERETO HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN ANY GUARANTOR AND THE
LENDER RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT.

2.11 Separability of Provisions; Headings. In case any one or more of the
provisions

contained in this Agreement should be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby. Section
headings in this Agreement are included for convenience of reference only and
shall not be given any substantive effect.

2.12 Agents and Attorneys-in-Fact. The Lender may employ agents and
attorneys-in-fact in connection herewith and shall not be responsible for the
negligence or misconduct of any such agents or attorneys-in-fact selected by it
in good faith except to the extent that a court of competent jurisdiction
determines in a final and nonappealable judgment that the Lender acted with
gross negligence or willful misconduct in the selection of such agents or
attorneys-in-fact.

2.13 Entire Agreement. This Agreement and the other Loan Documents embody the
entire agreement and understanding by and among the parties hereto and thereto
relating to the subject matter hereof and thereof and supersedes any and all
prior agreements and understandings, oral or written, relating to the subject
matter hereof and thereof.

2.14 English Language. This Agreement and each of the other Loan Documents has
been negotiated and executed in the English language. Except as specified
otherwise herein all certificates, reports, notices and other documents and
communications given or delivered pursuant to this Agreement and the other Loan
Documents (including any modifications or supplements hereto or thereto) shall
be in the English language, or accompanied by an English translation.

2.15 Representations, Warranties and Covenants. Each Guarantor makes, for the
benefit of the Lender, each of the representations, warranties and covenants
made in the Credit Agreement by the Borrower as to such Guarantor, its assets,
financial condition, operations, organization, legal status, business and the
Loan Documents to which it is a party.

[Balance of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered as of the day and year first above written.

 

[SUBSIDIARY GUARANTOR] By:     Name:     Title:     WELLS FARGO BANK, NATIONAL
ASSOCIATION By:     Name:     Title: