CONSENT, WAIVER & MODIFICATION TO
LOAN AND SECURITY AGREEMENT

This Consent, Waiver and Modification to Loan and Security Agreement (this
“Modification”) is entered into as of March 11, 2019 (the “Modification
Effective Date”), by and between Partners for Growth V, L.P., a Delaware limited
partnership with its principal place of business at 1751 Tiburon Blvd., Tiburon,
California 94920 (“PFG”) and Sonic Foundry, Inc., a Maryland corporation with
its principal place of business at 222 W. Washington Avenue, Madison, WI 53703
(“Borrower”). This Modification amends that certain Loan and Security Agreement
between PFG and Borrower dated as of May 11, 2018 (the “Original Loan Agreement
Date” and such Loan and Security Agreement, as amended, the “Loan Agreement”).

WHEREAS, Borrower has notified PFG that it will not meet the Minimum EBITDA
financial covenant for the quarterly reporting period ending December 31, 2018
(as specified in Section 5 in the Schedule) (the “Specified Default”);

WHEREAS, an existing investor creditor of Borrower, Mark Burish (“Burish”), who
has previously entered into a Subordination Agreement in favor of PFG, has
extended new credit to Borrower under a Note Purchase Agreement dated on or
about February 28, 2019 (the “NPA”) and will extend additional credit under the
NPA to Borrower after the Modification Effective Date and PFG desires to provide
its consent to Borrower incurring additional Subordinated Debt to Burish;

WHEREAS, the parties have determined to amend the Loan Agreement as set forth
herein inter alia for the purposes stated in these Recitals and PFG desires to
waive the Specified Default and consent to the additional Burish Indebtedness,
subject to the terms of this Modification;

NOW THEREFORE, the parties hereby agree as follows:

1.    DESCRIPTION OF EXISTING INDEBTEDNESS: As of the Modification Effective
Date, Borrower is indebted to PFG for the Obligations pursuant to the Existing
Loan Documents (as defined below) in the aggregate principal amount (prior to
accounting for the principal payment contemplated in this Modification) of
$2,166,666.64, plus interest thereon accrued through the Modification Effective
Date, plus a fee in the amount of $150,000 due at the Maturity Date or earlier
date at which Obligations fall due, all of which is outstanding and unpaid, plus
all Lender Expenses. Defined terms used but not otherwise defined herein shall
have the same meanings set forth in the Loan Agreement.

2.    DESCRIPTION OF COLLATERAL. Repayment of the Obligations is secured by the
Collateral, as described in the Loan Agreement, in that certain Intellectual
Property Security Agreement and related Collateral Agreements and Notices of
even date with the Loan Agreement (the “IP Agreement”) and the other Loan
Documents entered into on the dates of the Loan Agreement and the Loan
Agreement. The above-described security documents, together with all other
documents securing and/or perfecting security interests in the repayment of the
Obligations, shall be referred to herein as the “Security Documents”.
Hereinafter, the Security Documents, together with all other documents
evidencing or securing the Obligations are referred to as the “Existing Loan
Documents”.

3.ACKNOWLEDGMENT OF DEFAULT; WAIVER. Borrower acknowledges that it is in default
under the Loan Agreement due to the Specified Default. Subject to compliance
with the conditions set forth in Section 7, PFG hereby forever waives the
Specified Default for the particular compliance period specified within the
definition of Specified Default set forth in the Recitals. Borrower hereby
acknowledges and agrees that except as specifically provided in this Section,
nothing in this Section or anywhere in this Modification shall be deemed or
otherwise construed as a waiver by PFG of any of its rights and remedies
pursuant to the Existing Loan Documents, applicable law or otherwise.
4.    DESCRIPTION OF CHANGES IN TERMS. As from the Modification Effective Date
and expressly subject to the terms and conditions of this Modification:

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4.1    Senior Lender. The parties acknowledge that Silicon Valley Bank, the
named “Senior Lender” in the Loan Agreement as in effect on the Original Loan
Agreement Date has been repaid and the “Senior Loan Documents” defined therein,
terminated. All references in the Loan Agreement to the “Senior Lender”, except
for references to the Senior Lender as a depositary bank of Borrower (which
references shall be replaced with “Silicon Valley Bank”), are deleted. All
references to PFG rights and Liens being “subject to the rights of the Senior
Lender”, “subject to the security interest of the Senior Lender” and the like
are deleted. The Loan Agreement and the other Existing Loan Documents are
amended accordingly.

4.2    Section 4.6, Negative Covenants. Clauses (xv) of Section 4.6 is replaced
in its entirety with the following:

“ (xv) cause or permit (A) Japanese Subsidiary Indebtedness under its revolving
credit facility to exceed at any time $1,000,000 outstanding, or (B) aggregate
Subsidiary Indebtedness (which for the avoidance of doubt is inclusive of the
Subsidiary Indebtedness incurred by the Japanese Subsidiary) to exceed
$1,200,000 at any time; ”

4.3    Permitted Indebtedness. Clause (ix) of the definition of “Permitted
Indebtedness” in Section 7 of the Loan Agreement is deleted.

4.4    Repayment and Prepayment. The “Repayment” and “Prepayment” clauses in
Section 1 of the Schedule are amended to read in their entirety as follows (with
the addition of a new “Mandatory Prepayment” provision):

“
Repayment:            Borrower shall make monthly principal payments on the
first day of each calendar month in the amount of $83,333.34, plus interest
accrued thereon during the prior month, until the earlier of (i) the date on
which the unpaid principal balance of all Loans and any and all accrued and
unpaid interest and other monetary Obligations thereon have been paid in full,
and (ii) the Maturity Date.

Prepayment:            The principal of the Loan may be prepaid at any time, in
whole or in part, provided that, concurrently with the prepayment, Borrower pays
to PFG a prepayment fee equal to 1% of the principal amount prepaid in the first
year from the Effective Date. ”
    
4.5    Amendment of Section 5 of Schedule. Section 5 of the Schedule shall be
superseded and amended to read in its entirety as follows:

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“5. FINANCIAL COVENANTS
(Section 4.1):    Borrower shall comply with each of the following covenants.
Compliance shall be determined as of the end of each month, except as otherwise
specifically provided below:

(a) Minimum Coverage
Ratio: 
As of the last day of each month, permit the Coverage Ratio, in each case, for
each monthly period then ended (in each year during the term of this Agreement)
to be less than the amount set forth across from such period in the table below:

Calendar Months During Term        Ratio
December through May
0.7 : 1.00
June through November
0.9 : 1.00

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Thresholds for future periods shall be set by PFG in consultation with Borrower
based on Borrower’s then current financial plan, but in no event less than the
ratios set forth above.
(b) Minimum Qualifying
Revenue:
As of the last day of any calendar month, on or after December 1, 2018, on a
trailing twelve-month basis, permit Qualifying Revenue to be less than
$13,000,000. ”

4.6    Section 7 of the Agreement is amended to add or, as relevant, supersede
existing definitions in their entirety, the following definitions therein:

“Cash Equivalents” means (a) short-term obligations of, or fully guaranteed by,
the United States, (b) commercial paper rated A-1 or better by Standard & Poor’s
Rating Services, a division of The McGraw-Hill Companies, Inc. (or any successor
thereto) or P-1 or better by Moody’s Investors Service, Inc. (or any successor
thereto) with a duration of not more than nine (9) months, (c) demand deposit
accounts maintained in the ordinary course of business, and (d) certificates of
deposit issued by, and time deposits with, commercial banks (whether domestic or
foreign) having capital and surplus in excess of $100,000,000; provided in each
case that the same provides for payment of both principal and interest (and not
principal alone or interest alone) and is not subject to any contingency
regarding the payment of principal or interest.
“Coverage Ratio” means the ratio of (a) Qualified Assets to (b) all then
outstanding Burish Indebtedness obligations.

“Plan” means Borrower’s financial plan as presented to PFG on or about January
23, 2019, in the file in Excel format entitled “2019 Plan – Unlinked
1.12.19.xlsx”, as such financial plan is delivered in form and substance
acceptable to PFG in subsequent years for future periods.
“Qualified Assets” means (a) consolidated unrestricted cash and Cash Equivalent
recorded on the balance sheet of Borrower, plus (b) consolidated accounts
receivable.
“Qualifying Revenue” means the sum of revenues from “Customer Support” and
“Hosting” (each of which shall be consistent with the breakout for such line
item provided in that certain model dated as of December 29, 2017 and delivered
to PFG).
4.7    Subsidiary Indebtedness. Section 4.6(xv) is amended and superseded to
read in its entirety as follows:
“ (xv) cause or permit aggregate Subsidiary Indebtedness (which for the
avoidance of doubt is inclusive of the Subsidiary Indebtedness incurred by the
Japanese Subsidiary) to exceed $1,200,000 at any time, provided that such dollar
cap shall exclude Indebtedness owed by Borrower to PFG or its successors and
assigns that is guaranteed by Subsidiaries;”
4.8    Update to Compliance Certificate. The Compliance Certificate is amended
and superseded in the form appended to this Modification as Exhibit A.

5.    BORROWERS’ REPRESENTATIONS AND WARRANTIES. Borrower represents and
warrants that:
(a)    immediately upon giving effect to this Modification (i) the
representations and warranties contained in the Existing Loan Documents are
true, accurate and complete in all material respects as of the date hereof
(except to the extent qualified in the updated Representations deliverable to
PFG on or before the Modification Effective Date), and (ii) no Event of Default
has occurred and is continuing;
(b)    Borrower has the corporate power and authority to execute and deliver
this Modification and to perform its obligations under the Existing Loan
Documents, as amended by this Modification;

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(c)    the certificate of incorporation, bylaws and other organizational
documents of Borrower delivered to PFG remain true, accurate and complete and
have not been amended, supplemented or restated and are and continue to be in
full force and effect;
(d)    the execution and delivery by Borrower of this Modification and the
performance by Borrower of its obligations under the Existing Loan Documents, as
amended by this Modification, have been duly authorized by all necessary
corporate action on the part of Borrower;
(e)    this Modification has been duly executed and delivered by Borrower and is
the binding obligation of Borrower, enforceable against it in accordance with
the terms of this Modification, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, liquidation, moratorium or other similar
laws of general application and equitable principles relating to or affecting
creditors’ rights;
(f)    as of the date hereof, Borrower has no defenses against its obligation to
repay the Obligations and it has no claims of any kind against PFG. Borrower
acknowledges that PFG has acted in good faith and has conducted in a
commercially reasonable manner its relationship with such Borrower in connection
with this Modification and in connection with the Existing Loan Documents;
(g)    the Security Documents relating to Intellectual Property disclose an
accurate, complete and current listing of all Collateral that consists of
Intellectual Property; and
(h)    Borrower hereby ratifies, confirms and reaffirms, all and singular, the
terms and disclosures contained in the Representations dated as the Modification
Effective Date, appended as Exhibit B hereto, and acknowledges, confirms and
agrees that the disclosures and information Borrower provided to PFG therein
remain true, correct, accurate and complete as of the Modification Effective
Date.
Borrower understands and acknowledges that PFG is entering into this
Modification in reliance upon, and in partial consideration for, the above
representations and warranties, and agrees that such reliance is reasonable and
appropriate.
6.    CONTINUING VALIDITY. Borrower understands and agrees that in modifying the
existing Obligations, PFG is relying upon Borrower's representations,
warranties, and agreements, as set forth in the Existing Loan Documents. Except
as expressly modified pursuant to this Modification, the terms of the Existing
Loan Documents remain unchanged and in full force and effect. PFG's agreement to
modifications to the existing Obligations in no way shall obligate PFG to make
any future consents, waivers or modifications to the Obligations. Nothing in
this Modification shall constitute a satisfaction of the Obligations or a waiver
of any default under the Existing Loan Documents. It is the intention of PFG and
Borrower to retain as liable parties all makers and endorsers, if any, of the
Existing Loan Documents, unless the party is expressly released by PFG in
writing. Unless expressly released herein, no maker, endorser, or guarantor will
be released by virtue of this Modification. The terms of this paragraph apply
not only to this Modification, but also to all subsequent loan modification
agreements.

7.     CONDITIONS. The effectiveness of this Modification is conditioned upon
each of:

7.1    Execution and Delivery. Borrower and Guarantor shall have duly executed
and delivered a counterpart of this Modification to PFG.
7.2    Constitutional and Authority Documents. To the extent not in the form
delivered to PFG on the Effective Date, Borrower shall have delivered to PFG,
certified by a duly authorized officer of Borrower, to be true and complete as
of the Modification Effective Date: (i) the governing documents of Borrower as
in effect on the Modification Effective Date, and (ii) resolutions of Borrower’s
Board authorizing the execution and delivery of this Modification, the other
documents executed in connection herewith and Borrower’s performance of all of
the transactions contemplated hereby.

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7.3    Evidence of the Payoff and Termination of the (former) Senor Loan
Documents. Borrower shall have provided evidence in form and substance
satisfactory to PFG that the Senior Debt of Silicon Valley Bank reflected in the
Loan Agreement has been repaid in full, all rights of Borrower to borrower under
the Senior Loan Documents terminated and all Liens in connection with the Senior
Debt terminated.
7.4    Additional NPA Investor Financings. Acknowledging that as of the
Modification Effective Date Burish has funded $3,000,000 under the NPA, as
conditions subsequent, on or before March 31, 2019, Borrower shall have received
an additional minimum of $1,000,000 in NPA proceeds and on or before April 30,
2019, Borrower shall have received an further minimum of $1,000,000 in NPA
proceeds (for an aggregate of not less than $2,000,000 in proceeds after the
Modification Effective Date).
7.5    Subordination Agreement. Mark Burish shall have executed and delivered a
Subordination Agreement in favor of PFG, in agreed form, in respect of
Indebtedness incurred and to be incurred by Borrower to Mark Burish, his
Affiliates and any other note holders under the Note Purchase Agreement
referenced in the Recitals (“ Burish Indebtedness”).
7.6    Lender Expenses. Promptly upon invoice, Borrower shall have paid all
Lender Expenses invoiced by PFG in connection with this Modification.

7.7    Updated Representations. Borrower shall have executed and delivered an
updated version of the Representations, appended as Exhibit B hereto.
The failure of any of the conditions (precedent or subsequent) set forth in this
Section 7 shall constitute an immediate Event of Default.
8.    PFG CONSENT. PFG hereby consents to Borrower incurring additional
Indebtedness as disclosed to PFG to Burish so long as such Indebtedness is
subordinated in payment and Lien (if secured) priority to the PFG Obligations
and Liens security the PFG Obligations pursuant to a Subordination Agreement
between PFG and Burish, in agreed form. Any repayment (including redemption) of
the Burish Indebtedness other than in accordance with the (non-accelerated)
payment schedule as set forth the agreements evidencing the Burish Indebtedness
in the form as in effect on the Modification Effective Date (including that
certain Note Purchase Agreement executed and delivered between Burish and
Borrower in February 2019) shall require the further express consent of PFG.

9.    RATIFICATIION OF EXISTING LOAN DOCUMENTS; FURTHER ASSURANCES. Borrower (a)
acknowledges and agrees that (i) each of the Existing Loan Documents remains in
full force and effect in accordance with the original terms, except as expressly
modified hereby, (ii) the Liens granted by the Borrower to PFG under the
Existing Loan Documents shall remain in place, unimpaired by the transactions
contemplated by this Agreement, and PFG’s priority with respect thereto shall
not be affected hereby or thereby other than as contemplated by the
Intercreditor Agreement, and (iii) the Loan Agreement and the other Existing
Loan Documents shall continue to secure all Obligations as stated therein except
as expressly amended and modified by this Modification; (b) Borrower ratifies,
reaffirms, restates and incorporates by reference all of its representations,
warranties, covenants, and agreements made under the Existing Loan Documents
except to the extent modified herein; (c) Borrower hereby ratifies, confirms,
and reaffirms that the Obligations include, without limitation, the Loans, and
any future modifications, amendments, substitutions or renewals thereof; (d)
Borrower has no defenses, affirmative or otherwise, rights of setoff, rights of
recoupment, claims, counterclaims, actions or causes of action of any kind or
nature whatsoever against PFG or any past, present or future agent, attorney,
legal representative, predecessor-in-interest, affiliate, successor, assign,
employee, director or officer of PFG, directly or indirectly, arising out of,
based upon, or in any manner connected with, any transaction, event,
circumstance, action, failure to act, or occurrence of any sort or type, whether
known or unknown, which occurred, existed, was taken, permitted, or began prior
to the execution of this Agreement and accrued, existed, was taken, permitted or
begun in accordance with, pursuant to, or by virtue of the terms or conditions
of the Existing Loan Documents, or which directly or indirectly relate to or
arise out of or in any manner are connected with any of the Existing Loan
Documents; (e) Borrower and PFG confirm that neither party has heretofore waived
or modified, and has not agreed to waive or modify, any term of the Existing
Loan Documents, and any actions that Borrower takes or

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fails to take (including the expenditure of any funds) is voluntary, informed
and taken at its own risk; and (g) Borrower shall, from and after the execution
of this Agreement, execute and deliver to PFG whatever additional documents,
instruments, and agreements that PFG may reasonably require in order to perfect
the Collateral granted in the Loan Agreement more securely in PFG and to
otherwise give effect to the terms and conditions of this Modification. Nothing
in this Modification shall constitute a satisfaction of the Obligations or a
waiver of any default under the Existing Loan Documents, except of the Specified
Defaults to the extent waived herein.
10.    INTEGRATION; CONSTRUCTION. This Modification, the Loan Agreement and the
Existing Loan Documents (as modified) and any documents executed in connection
herewith or pursuant hereto contain the entire agreement between the parties
with respect to the subject matter hereof and supersede all prior agreements,
understandings, offers and negotiations, oral or written, with respect thereto
and no extrinsic evidence whatsoever may be introduced in any judicial or
arbitration proceeding, if any, involving this Modification; provided, however,
that any financing statements or other agreements or instruments filed by PFG
with respect to Borrower shall remain in full force and effect. The Existing
Loan Documents are hereby amended wherever necessary to reflect the
modifications set forth in this Modification. The quotation marks around
modified clauses set forth herein and any differing font styles in which such
clauses are presented herein are for ease of reading only and shall be ignored
for purposes of construing and interpreting this Modification. This Modification
is subject to the General Provisions of Section 8 of the Loan Agreement, each of
which are incorporated herein as if set forth in this Modification.

11.    RELEASE. FOR AND IN CONSIDERATION OF PFG’S AGREEMENTS CONTAINED HEREIN,
BORROWER, TOGETHER WITH ITS SUCCESSORS AND ASSIGNS (INDIVIDUALLY AND
COLLECTIVELY, “RELEASORS”) HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER
WAIVES AND DISCHARGES PFG AND EACH OF ITS RESPECTIVE PARENTS, DIVISIONS,
SUBSIDIARIES, AFFILIATES, MEMBERS, MANAGERS, PARTICIPANTS, PREDECESSORS,
SUCCESSORS, AND ASSIGNS, AND EACH OF THEIR RESPECTIVE CURRENT AND FORMER
DIRECTORS, OFFICERS, SHAREHOLDERS, MEMBERS, MANAGERS, PARTNERS, AGENTS, AND
EMPLOYEES, AND EACH OF THEIR RESPECTIVE PREDECESSORS, SUCCESSORS, HEIRS, AND
ASSIGNS (INDIVIDUALLY AND COLLECTIVELY, THE “RELEASED PARTIES”) FROM ALL
POSSIBLE CLAIMS, COUNTERCLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES,
COSTS, EXPENSES AND LIABILITIES WHATSOEVER, WHETHER KNOWN OR UNKNOWN,
ANTICIPATED OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT OR
CONDITIONAL, OR AT LAW OR IN EQUITY, IN ANY CASE ORIGINATING IN WHOLE OR IN PART
ON OR BEFORE THE EFFECTIVE DATE THAT ANY OF THE RELEASORS MAY NOW OR HEREAFTER
HAVE AGAINST THE RELEASED PARTIES, IF ANY, IRRESPECTIVE OF WHETHER ANY SUCH
CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR
OTHERWISE, ANY PRIOR OR EXISTING LOANS BETWEEN RELEASORS AND RELEASED PARTIES,
ANY OF THE EXISTING LOAN DOCUMENTS, THE EXERCISE OF ANY RIGHTS AND REMEDIES
UNDER ANY OF THE EXISTING LOAN DOCUMENTS, AND/OR NEGOTIATION FOR AND EXECUTION
OF THIS AGREEMENT. EACH OF THE RELEASORS WAIVES THE BENEFITS OF ANY LAW
INCLUDING SECTION 1542 OF THE CALIFORNIA CIVIL CODE, WHICH MAY PROVIDE IN
SUBSTANCE: “A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR
RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE
TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE
MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”
EACH OF THE RELEASORS UNDERSTANDS THAT THE FACTS WHICH IT BELIEVES TO BE TRUE AT
THE TIME OF MAKING THE RELEASE PROVIDED FOR HEREIN MAY LATER TURN OUT TO BE
DIFFERENT THAN IT NOW BELIEVES, AND THAT INFORMATION WHICH IS NOT NOW KNOWN OR
SUSPECTED MAY LATER BE DISCOVERED. EACH OF THE RELEASORS ACCEPTS THIS
POSSIBILITY, AND EACH OF THEM ASSUMES THE RISK OF THE FACTS TURNING OUT TO BE
DIFFERENT AND NEW INFORMATION BEING DISCOVERED; AND EACH OF THEM FURTHER AGREES
THAT THE RELEASE PROVIDED FOR HEREIN SHALL IN ALL RESPECTS CONTINUE TO BE
EFFECTIVE AND NOT SUBJECT TO TERMINATION OR RESCISSION BECAUSE OF ANY DIFFERENCE
IN SUCH FACTS OR ANY NEW INFORMATION. Borrower acknowledges that (i) this
release may be pleaded as a full and complete defense and/or as a
cross-complaint or counterclaim against any action, suit, or other proceeding
that may be instituted, prosecuted or attempted in breach of this release, and
(ii) Borrower acknowledges that the release contained herein

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constitutes a material inducement to PFG to enter into this Modification, and
that PFG would not have done so but for PFG’s expectation that such release is
valid and enforceable in all events.

12.    ADVICE OF COUNSEL. PFG and Borrower have prepared this Modification and
all documents, instruments, and agreements incidental hereto with the aid and
assistance of their respective counsel. Accordingly, all of them shall be deemed
to have been drafted by PFG and Borrower and shall not be construed against the
PFG or Borrower.

13.    ILLEGALITY OR UNENFORCEABILITY. Any determination that any provision or
application of this Modification or the Loan Agreement is invalid, illegal, or
unenforceable in any respect, or in any instance, shall not affect the validity,
legality, or enforceability of any such provision in any other instance, or the
validity, legality, or enforceability of any other provision of this Agreement.

14.    GOVERNING LAW; VENUE. THIS MODIFICATION SHALL BE GOVERNED BY AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
Borrower and PFG submit to the exclusive jurisdiction of the State and Federal
courts in Santa Clara County, California, in connection with any proceeding or
dispute arising in connection herewith.

[Signature Page Follows]

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This Modification is executed as of the date first written above.

Borrower:
SONIC FOUNDRY, INC.

By/s/Ken Minor
   
Name: Ken Minor

Title: Chief Financial Officer

PFG:
PARTNERS FOR GROWTH V, L.P.

By/s/Geoffrey Allan

Name: Geoffrey Allan

Title: Manager, Partners for Growth V, LLC, its General Partner

Signature Page - PFG - Sonic Foundry Consent, Waiver & Modification to Loan and
Security Agreement

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Exhibit A – Restated Compliance Certificate

Compliance Certificate
===========================================================================
Borrower: SONIC FOUNDRY, INC.
222 West Washington Avenue
 Madison, WI 53703
Lender: Partners for Growth V, L.P. (“PFG”)
1751 Tiburon Blvd.
Tiburon, CA 94920

The undersigned authorized officer of Borrower hereby certifies that in
accordance with the terms and conditions of the Loan and Security Agreement
between Borrower and PFG dated as of May 11, 2018 (the "Agreement"), (i)
Borrower (on a consolidated basis) is in complete compliance for the period
ending __________________ with all required covenants except as detailed below,
(ii) all representations and warranties of Borrower stated in the Agreement,
including the Representation Letter, as defined in the Agreement, are true,
complete, correct and accurate on this date except those representations and
warranties expressly referring to a specific date shall be true, complete,
correct and accurate as of such date, and except as noted below or on any
disclosure letter attached to this Certificate, (iii) each Borrower and each of
its Subsidiaries has timely filed all required tax returns and reports, and each
Borrower has timely paid all foreign, federal state and local taxes,
assessments, deposits and contributions owed by Borrower(s) except as otherwise
permitted pursuant to the Loan Agreement, (iv) no Liens have been levied or
claims made against any Borrower or any of its Subsidiaries relating to unpaid
employee payroll or benefits of which such Borrower has not previously provided
written notification to PFG, and (v) there are no Defaults or Events of Default.
Attached herewith are the required documents supporting the above certification.
The undersigned further certifies that the financial statements, information and
schedules referred to below have been prepared in accordance with Generally
Accepted Accounting Principles (GAAP) and are consistent from one period to the
next except as explained in an accompanying letter or footnotes.

Please indicate compliance status by circling Yes/No under "Complies" column.
Reporting Covenants
Required
Complies

Compliance Certificates
Monthly within 30 Days
Yes
No
Unaudited Financial Statements
Monthly within 30 Days
Yes
No
AR and AP Agings
Monthly within 30 Days
Yes
No
Annual Budgets/Projections
As soon as available / 30 days of FYE
Yes
No
Audited Financial Statements
Annually within 120 Days of FYE
Yes
No
Subsidiary and Japan Sub debt
Monthly within 30 days
Yes
No
Other Reports
When Requested by PFG
Yes
No
Representations Letter Update
When Required To be updated as and when necessary to keep the information
current, accurate and complete. or each Q-End
Yes
No

Financial Covenants See page 2     Required      Actual             Complies
Minimum Coverage Ratio
 
 
 
 
Minimum Qualifying Revenue
> $13,000,000
 
 
 

Sincerely,

            
SIGNATURE

    
TITLE
    
DATE
                                                              
1To be updated as and when necessary to keep the information current, accurate
and complete.
2See page 2

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Financial Covenants (Section 5 of Schedule to Loan and Security Agreement)
===========================================================================
“5. Financial Covenants
(Section 4.1):
Borrower shall comply with each of the following covenants. Compliance shall be
determined as of the end of each month, except as otherwise specifically
provided below:

(a) Minimum Coverage
Ratio: 
As of the last day of each month, permit the Coverage Ratio, in each case, for
each monthly period then ended (in each year during the term of this Agreement)
to be less than the amount set forth across from such period in the table below:

Calendar Months During Term        Ratio
December through May
0.7 : 1.00
June through November
0.9 : 1.00

Thresholds for future periods shall be set by PFG in consultation with Borrower
based on Borrower’s then current financial plan, but in no event less than the
ratios set forth above.
(b) Minimum Qualifying
Revenue:
As of the last day of any calendar month, on or after December 1, 2018, on a
trailing twelve-month basis, permit Qualifying Revenue to be less than
$13,000,000. ”

===========================================================================

Corresponding Definitions for Financial Covenants

“Cash Equivalents” means (a) short-term obligations of, or fully guaranteed by,
the United States, (b) commercial paper rated A-1 or better by Standard & Poor’s
Rating Services, a division of The McGraw-Hill Companies, Inc. (or any successor
thereto) or P-1 or better by Moody’s Investors Service, Inc. (or any successor
thereto) with a duration of not more than nine (9) months, (c) demand deposit
accounts maintained in the ordinary course of business, and (d) certificates of
deposit issued by, and time deposits with, commercial banks (whether domestic or
foreign) having capital and surplus in excess of $100,000,000; provided in each
case that the same provides for payment of both principal and interest (and not
principal alone or interest alone) and is not subject to any contingency
regarding the payment of principal or interest.
“Coverage Ratio” means the ratio of (a) Qualified Assets to (b) all then
outstanding Burish Indebtedness obligations.

“Plan” means Borrower’s financial plan as presented to PFG on or about January
23, 2019, in the file in Excel format entitled “2019 Plan - Unlinked
1.12.19.xlsx”, as such financial plan is delivered in form and substance
acceptable to PFG in subsequent years for future periods.
“Qualified Assets” means (a) consolidated unrestricted cash and Cash Equivalent
recorded on the balance sheet of Borrower, plus (b) consolidated accounts
receivable.
“Qualifying Revenue” means the sum of revenues from “Customer Support” and
“Hosting” (each of which shall be consistent with the breakout for such line
item provided in that certain model dated as of December 29, 2017 and delivered
to PFG).
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