Exhibit 10.1
 
THIRD AMENDMENT
TO
LOAN AND SECURITY AGREEMENT

This Third Amendment to Loan and Security Agreement (the “Amendment”) is entered
into as of January 10, 2007, by and between COMERICA BANK (“Bank”) and
VITALSTREAM HOLDINGS, INC., VITALSTREAM, INC. and VITALSTREAM BROADCASTING
CORPORATION (each a “Borrower” and collectively, the “Borrowers”).

RECITALS

Borrowers and Bank are parties to that certain Loan and Security Agreement dated
as of October 7, 2004 (as amended from time to time, including without
limitation by that certain First Amendment to Loan and Security Agreement dated
as of December 31, 2005, and that certain Second Amendment to Loan and Security
Agreement dated as of July 17, 2006, together with any related agreements, the
“Agreement”). Hereinafter, all indebtedness owing by Borrowers to Bank shall be
referred to as the “Indebtedness.” The parties desire to amend the Agreement in
accordance with the terms of this Amendment.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:

AGREEMENT

I.
Incorporation by Reference. The Recitals and the documents referred to therein
are incorporated herein by this reference. Except as otherwise noted, the terms
not defined herein shall have the meaning set forth in the Agreement.

 

II.
Amendment to the Agreement. Subject to the satisfaction of the conditions
precedent as set forth in Article IV hereof, the Agreement is hereby amended as
set forth below.

 

 
A.
The following defined term in Section 1.1 of the Agreement is hereby amended and
restated in its entirety to read as follows:

“Revolving Maturity Date” means June 30, 2007.

B.
Bank’s contact person set forth in Section 10 of the Agreement is hereby changed
from “James Ligman” to “Gary Reagan”.

 
C.
Section 11 of the Agreement is hereby amended and restated in its entirety to
read as follows: “

 

11.
CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

 
This Agreement shall be governed by, and construed in accordance with, the
internal laws of the State of California, without regard to principles of
conflicts of law. Jurisdiction shall lie in the State of California. THE
UNDERSIGNED ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY IS A CONSTITUTIONAL ONE,
BUT THAT IT MAY BE WAIVED UNDER CERTAIN CIRCUMSTANCES. TO THE EXTENT PERMITTED
BY LAW, EACH PARTY, AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT)
WITH COUNSEL OF ITS, HIS OR HER CHOICE, KNOWINGLY AND VOLUNTARILY, AND FOR THE
MUTUAL BENEFIT OF ALL PARTIES, WAIVES ANY RIGHT TO TRIAL BY JURY IN THE EVENT OF
LITIGATION ARISING OUT OF OR RELATED TO THIS AGREEMENT OR ANY OTHER DOCUMENT,
INSTRUMENT OR AGREEMENT BETWEEN THE UNDERSIGNED PARTIES.”
 
AMENDMENT
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D.
Section 12 of the Agreement is hereby amended and restated in its entirety to
read as follows:

 

“12.
REFERENCE PROVISION.

 
12.1 In the event the Jury Trial Waiver set forth above is not enforceable, the
parties elect to proceed under this Judicial Reference Provision.
 
12.2 With the exception of the items specified in Section 12.3, below, any
controversy, dispute or claim (each, a “Claim”) between the parties arising out
of or relating to this Agreement or any other document, instrument or agreement
between the undersigned parties (collectively in this Section, the “Loan
Documents”), will be resolved by a reference proceeding in California in
accordance with the provisions of Sections 638 et seq. of the California Code of
Civil Procedure (“CCP”), or their successor sections, which shall constitute the
exclusive remedy for the resolution of any Claim, including whether the Claim is
subject to the reference proceeding. Except as otherwise provided in the Loan
Documents, venue for the reference proceeding will be in the Superior Court in
the County where the real property involved in the action, if any, is located or
in a County where venue is otherwise appropriate under applicable law (the
“Court”).
 
12.3 The matters that shall not be subject to a reference are the following: (i)
nonjudicial foreclosure of any security interests in real or personal property,
(ii) exercise of selfhelp remedies (including, without limitation, set-off),
(iii) appointment of a receiver and (iv) temporary, provisional or ancillary
remedies (including, without limitation, writs of attachment, writs of
possession, temporary restraining orders or preliminary injunctions). This
Agreement does not limit the right of any party to exercise or oppose any of the
rights and remedies described in clauses (i) and (ii) or to seek or oppose from
a court of competent jurisdiction any of the items described in clauses (iii)
and (iv). The exercise of, or opposition to, any of those items does not waive
the right of any party to a reference pursuant to this Agreement.
 
12.4 The referee shall be a retired Judge or Justice selected by mutual written
agreement of the parties. If the parties do not agree within ten (10) days of a
written request to do so by any party, then, upon request of any party, the
referee shall be selected by the Presiding Judge of the Court (or his or her
representative). A request for appointment of a referee may be heard on an ex
parte or expedited basis, and the parties agree that irreparable harm would
result if ex parte relief is not granted.
 
12.5 The parties agree that time is of the essence in conducting the reference
proceedings. Accordingly, the referee shall be requested, subject to change in
the time periods specified herein for good cause shown, to (i) set the matter
for a status and trial-setting conference within fifteen (15) days after the
date of selection of the referee, (ii) if practicable, try all issues of law or
fact within one hundred twenty (120) days after the date of the conference and
(iii) report a statement of decision within twenty (20) days after the matter
has been submitted for decision.
 
12.6 The referee will have power to expand or limit the amount and duration of
discovery. The referee may set or extend discovery deadlines or cutoffs for good
cause, including a party’s failure to provide requested discovery for any reason
whatsoever. Unless otherwise ordered based upon good cause shown, no party shall
be entitled to “priority” in conducting discovery, depositions may be taken by
either party upon seven (7) days written notice, and all other discovery shall
be responded to within fifteen (15) days after service. All disputes relating to
discovery which cannot be resolved by the parties shall be submitted to the
referee whose decision shall be final and binding.
 
AMENDMENT
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12.7 Except as expressly set forth in this Agreement, the referee shall
determine the manner in which the reference proceeding is conducted including
the time and place of hearings, the order of presentation of evidence, and all
other questions that arise with respect to the course of the reference
proceeding. All proceedings and hearings conducted before the referee, except
for trial, shall be conducted without a court reporter, except that when any
party so requests, a court reporter will be used at any hearing conducted before
the referee, and the referee will be provided a courtesy copy of the transcript.
The party making such a request shall have the obligation to arrange for and pay
the court reporter. Subject to the referee’s power to award costs to the
prevailing party, the parties will equally share the cost of the referee and the
court reporter at trial.
 
12.8 The referee shall be required to determine all issues in accordance with
existing case law and the statutory laws of the State of California. The rules
of evidence applicable to proceedings at law in the State of California will be
applicable to the reference proceeding. The referee shall be empowered to enter
equitable as well as legal relief, enter equitable orders that will be binding
on the parties and rule on any motion which would be authorized in a court
proceeding, including without limitation motions for summary judgment or summary
adjudication. The referee shall issue a decision at the close of the reference
proceeding which disposes of all claims of the parties that are the subject of
the reference. Pursuant to CCP § 644, such decision shall be entered by the
Court as a judgment or an order in the same manner as if the action had been
tried by the Court and any such decision will be final, binding and conclusive.
The parties reserve the right to appeal from the final judgment or order or from
any appealable decision or order entered by the referee. The parties reserve the
right to findings of fact, conclusions of laws, a written statement of decision,
and the right to move for a new trial or a different judgment, which new trial,
if granted, is also to be a reference proceeding under this provision.
 
12.9 If the enabling legislation which provides for appointment of a referee is
repealed (and no successor statute is enacted), any dispute between the parties
that would otherwise be determined by reference procedure will be resolved and
determined by arbitration. The arbitration will be conducted by a retired judge
or Justice, in accordance with the California Arbitration Act §1280 through
§1294.2 of the CCP as amended from time to time. The limitations with respect to
discovery set forth above shall apply to any such arbitration proceeding.
 
12.10 THE PARTIES RECOGNIZE AND AGREE THAT ALL CONTROVERSIES, DISPUTES AND
CLAIMS RESOLVED UNDER THIS REFERENCE PROVISION WILL BE DECIDED BY A REFEREE AND
NOT BY A JURY. AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH
COUNSEL OF ITS, HIS OR HER OWN CHOICE, EACH PARTY KNOWINGLY AND VOLUNTARILY, AND
FOR THE MUTUAL BENEFIT OF ALL PARTIES, AGREES THAT THIS REFERENCE PROVISION WILL
APPLY TO ANY CONTROVERSY, DISPUTE OR CLAIM BETWEEN OR AMONG THEM ARISING OUT OF
OR IN ANY WAY RELATED TO, THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.”
 

III.
Legal Effect.

A.
The Agreement is hereby amended wherever necessary to reflect the changes
described above. Each Borrower understands and agrees that in modifying the
existing Indebtedness, Bank is relying upon such Borrower’s representations,
warranties, and agreements, as set forth in the Agreement. Except as expressly
modified pursuant to this Amendment, the terms of the Agreement remain
unchanged, and in full force and effect. Bank’s agreement to modifications to
the existing Indebtedness pursuant to this Amendment in no way shall obligate
Bank to make any future modifications to the Indebtedness. Nothing in this
Amendment shall constitute a satisfaction of the Indebtedness. It is the
intention of Bank and Borrowers to retain as liable parties, all makers and
endorsers of Agreement, unless the party is expressly released by Bank in
writing. No maker, endorser, or guarantor will be released by virtue of this
Amendment. The terms of this paragraph apply not only to this Amendment, but
also to all subsequent loan modification requests.

 

AMENDMENT
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B.
This Amendment may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one
instrument. This is an integrated Amendment and supersedes all prior
negotiations and agreements regarding the subject matter hereof. All
modifications hereto must be in writing and signed by the parties.

IV.
Conditions Precedent. Except as specifically set forth in this Amendment, all of
the terms and conditions of the Agreement remain in full force and effect. The
effectiveness of this Agreement is conditioned upon receipt by Bank of this
Amendment, and any other documents which Bank may require to carry out the terms
hereof, including but not limited to the following:

A.
This Amendment, duly executed by Borrowers;

B.
Corporation Resolutions and Incumbency Certification, duly executed by
Borrowers;

C.
A commitment fee from the Borrowers in the amount of $5,000;

D.
A legal fee from the Borrowers in the amount of $250; and

 
E.
Such other documents, and completion of such other matters, as Bank may
reasonably deem necessary or appropriate.

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first
date above written.

VITALSTREAM HOLDINGS, INC.
VITALSTREAM BROADCASTING CORPORATION
   
By: Philip N. Kaplan
By: Philip N. Kaplan
Title: President and COO
Title: President and COO
       
VITALSTREAM, INC.
COMERICA BANK
   
By: Philip N. Kaplan
By: Gary D. Reagan
Title: President and COO
Title: Senior Vice President

AMENDMENT
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