Exhibit 10.64
THIRD LOAN MODIFICATION AGREEMENT
This Third Loan Modification Agreement (this “Loan Modification Agreement”) is
entered into as of June 10, 2009, by and among (a) SILICON VALLEY BANK, a
California corporation, with its principal place of business at 3003 Tasman
Drive, Santa Clara, California 95054 (“Bank”) and (b) FINISAR CORPORATION, a
Delaware corporation, with its chief executive office located at 1399 Moffett
Park Drive, Sunnyvale, California 94089 (“Finisar”) and OPTIUM CORPORATION, a
Delaware corporation, with its principal place of business at 500 Horizon Drive,
Suite 505, Chalfont, Pennsylvania 18914 (“Optium”) (hereinafter, Finisar and
Optium are jointly and severally, individually and collectively, referred to as
“Borrower”).
1. DESCRIPTION OF EXISTING INDEBTEDNESS AND OBLIGATIONS, Among other
indebtedness and obligations which may be owing by Borrower to Bank, Borrower is
indebted to Bank pursuant to a loan arrangement dated as of March 14, 2008,
evidenced by, among other documents, a certain Loan and Security Agreement dated
as of March 14, 2008, among Borrower and Bank, as affected by a certain Joinder
Agreement dated as of October 30, 2008, as amended by a certain First Loan
Modification Agreement dated as of October 30, 2008, and as further amended by a
certain Second Loan Modification Agreement dated as of February 6, 2009 (as
amended and affected, the “Loan Agreement”). Capitalized terms used but not
otherwise defined herein shall have the same meaning as in the Loan Agreement.
2. DESCRIPTION OF COLLATERAL. Repayment of the Obligations is secured by the
Collateral as described in the Loan Agreement (together with any other
collateral security granted to Bank, the “Security Documents”). Hereinafter, the
Security Documents, together with all other documents evidencing or securing the
Obligations shall be referred to as the “Existing Loan Documents”.
3. DESCRIPTION OF CHANGE IN TERMS.
     A. Modifications to Loan Agreement.

  1   The Loan Agreement shall be amended by deleting the following text,
appearing in Section 2.1.1 (a) thereof:

“Subject to the terms and conditions of this Agreement and to deduction of
Reserves, Bank shall make Advances not exceeding the Availability Amount.”
and inserting in lieu thereof the following:
“Subject to the terms and conditions of this Agreement and, during an Asset
Based Period, to deduction of Reserves, Bank shall make Advances not exceeding
the Availability Amount.”

  2   The Loan Agreement shall be amended by deleting the following text,
appearing in Section 2.1.2(a) thereof:

“As part of the Revolving Line, Bank shall issue or have issued Letters of
Credit for Borrower’s account.”
and inserting in lieu thereof the following:
“As part of the Revolving Line and, during an Asset Based Period, subject to
deduction of Reserves, Bank shall issue or have issued Letters of Credit for
Borrower’s account.”

  3   The Loan Agreement shall be amended by deleting the following text,
appearing in Section 2.1.3 thereof:

 

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“As part of the Revolving Line, Borrower may enter into foreign exchange
contracts with Bank under which Borrower commits to purchase from or sell to
Bank a specific amount of Foreign Currency (each, a “FX Forward Contract”) on a
specified date (the “Settlement Date”).”
and inserting in lieu thereof the following;
“As part of the Revolving Line and, during an Asset Based Period, subject to
deduction of Reserves, Borrower may enter into foreign exchange contracts with
Bank under which Borrower commits to purchase from or sell to Bank a specific
amount of Foreign Currency (each, a “FX Forward Contract”) on a specified date
(the “Settlement Date”).”

  4   The Loan Agreement shall be amended by deleting the following, appearing
as Section 2.2 thereof:

“ 2.2 Overadvances. If, at any time, the Credit Extensions under Sections 2.1.1,
2.1.2, 2.1.3 and 2.1.4 exceed the Revolving Line, Borrower shall immediately pay
to Bank in cash such excess.”
and inserting in lieu thereof the following:
“ 2.2 Overadvances; Further Limitation.
     (a) If, at any time, the sum of (i) the outstanding principal amount of any
Advances (including any amounts used for Cash Management Services), plus
(ii) the face amount of any outstanding Letters of Credit (including drawn but
unreimbursed Letters of Credit and any Letter of Credit Reserve), plus (iii) the
FX Reserve, exceeds the lesser of either the Revolving Line or the Borrowing
Base, Borrower shall immediately pay to Bank in cash such excess.
     (b) In order to have Credit Extensions outstanding that exceed Twenty-Five
Million Dollars ($25,000,000.00) in the aggregate, Borrower shall provide
evidence to Bank, upon Bank’s request, that it has unrestricted cash (as set
forth on its balance sheet) in an amount equal to at least the sum of (i) Fifty
Million Dollars ($50,000,000.00) plus (ii) the aggregate amount of Credit
Extensions outstanding at such time. Borrower shall be required to comply with
this provision at all times that the aggregate amount of Credit Extensions
outstanding exceeds Twenty-Five Million Dollars ($25,000,000.00). With respect
to each request of a Credit Extension that, when made, would result in the
aggregate amount of Credit Extensions outstanding exceeding Twenty-Five Million
Dollars ($25,000,000.00), Borrower shall deliver to Bank evidence of Borrower’s
compliance with this provision (after giving effect to such Credit Extension) as
a condition precedent to such Credit Extension. If at any time the aggregate
amount of Credit Extensions outstanding exceeds the amount permitted by this
Section 2.2(b), then Borrower shall immediately pay to Bank in cash such
excess.”

  5   The Loan Agreement shall be amended by inserting the following new text,
appearing at the end of Section 2.4 thereof:

     “ (h) Float Charge. In connection with the computation of interest
hereunder, during an Asset Based Period, Bank shall be entitled to charge
Borrower a “float” charge in an amount equal to three (3) Business Days
interest, at the interest rate applicable to the Credit Extensions, on all
payments received

 

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by Bank in the form of a check in respect of payments made by an Account Debtor.
The float charge for each month shall be payable on the first day of the month.”

  6   The Loan Agreement shall be amended by deleting the following text,
appearing in Section 3.2 thereof:

“ (a) timely receipt of a Notice of Borrowing;”
and inserting in lieu thereof the following:
“ (a) timely receipt of a Notice of Borrowing and, during an Asset Based Period,
an executed Transaction Report;”

  7   The Loan Agreement shall be amended by inserting the following new
Section 5.12, appearing immediately after Section 5.11 thereof:

“ 5.12 Accounts Receivable. For any Eligible Account and Eligible Foreign
Account in any Borrowing Base Certificate, all statements made and all unpaid
balances appearing in all invoices, instruments and other documents evidencing
such Eligible Accounts and Eligible Foreign Accounts are and shall be true and
correct and all such invoices, instruments and other documents, and all of
Borrower’s Books are genuine and in all respects what they purport to be.
Whether or not an Event of Default has occurred and is continuing, Bank may
notify any Account Debtor owing Borrower money of Bank’s security interest in
such funds and verify the amount of such Eligible Account and Eligible Foreign
Account. All sales and other transactions underlying or giving rise to each
Eligible Account and Eligible Foreign Account shall comply in all material
respects with all applicable laws and governmental rules and regulations.
Borrower has no knowledge of any actual or imminent Insolvency Proceeding of any
Account Debtor whose accounts are Eligible Accounts or Eligible Foreign Accounts
in any Borrowing Base Certificate. To the best of Borrower’s knowledge, all
signatures and endorsements on all documents, instruments, and agreements
relating to all Eligible Accounts and Eligible Foreign Accounts are genuine, and
all such documents, instruments and agreements are legally enforceable in
accordance with their terms.”

  8   The Loan Agreement shall be amended by inserting the following new text,
appearing at the end of Section 6.2 thereof:

“ (c) Within thirty (30) days after the last day of each month, deliver to Bank
with the monthly financial statements, (i) a duly completed Borrowing Base
Certificate signed by a Responsible Officer, and (ii) aged listings of accounts
receivable and accounts payable (by invoice date).
     (d) During an Asset Based Period, unless a Streamline Period is then in
effect, deliver to Bank, weekly, and upon each request for a Credit Extension, a
Transaction Report.
     (e) Allow Bank to audit Borrower’s Collateral at Borrower’s expense. Such
audits shall be conducted no more often than one (1) time per calendar year (or,
during an Asset Based Period, two (2) times per calendar year) unless an Event
of Default has occurred and is continuing. Borrower acknowledges that the first
such audit will occur within sixty (60) days of the 2009 Effective Date.”

 

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  9   The Loan Agreement shall be amended by deleting the following appearing as
Section 6.7 thereof:

“ 6.7 Financial Covenants
     Borrower shall maintain at all times, to be tested as of the last day of
each month, unless otherwise noted:
     (a) Adjusted Quick Ratio. An Adjusted Quick Ratio of at least (i) 0.90 to
1.0 through and including the month ending June 30, 2008, (ii) 1.0 to 1.0 as of
the month ending July 31, 2008 through and including the month ending
September 30, 2008, (iii) 1.10 to 1.00 as of October 31, 2008 through and
including the month ending June 30, 2009, and (iv) 1.25 to 1.00 as of the month
ending July 31, 2009 and thereafter.
     (b) EBITDA. As of the last day of each of Borrower’s fiscal quarters,
commencing with the fiscal quarter ended October 31, 2007, Borrower shall have
EBITDA for the six-month period ending on the last day of such quarter of at
least (i) Five Million Dollars ($5,000,000.00) for the quarters ended
October 31, 2007, January 31, 2008, April 30, 2008 and July 31, 2008,
(ii) Twenty Million Dollars ($20,000,000.00) for the quarters ending October 31,
2008, January 31, 2009 and April 30, 2009, and (iii) Twenty-Five Million Dollars
($25,000,000.00) for the quarter ending on July 31, 2009 and as of the last day
of each quarter thereafter.”
and inserting in lieu thereof the following:
“ 6.7 Financial Covenants
     Borrower shall maintain at all times, to be tested as of the last day of
each month, unless otherwise noted:
     (a) Adjusted Quick Ratio.
     (i) Quarterly Adjusted Quick Ratio. An Adjusted Quick Ratio of at least
(A) 1.10 to 1.00 as of the month ending April 30, 2009, (B) 1.15 to 1.00 as of
the months ending July 31, 2009 and October 31, 2009, and (C) 1.25 to 1.00 as of
the month ending January 31, 2010 and for the last month in each of Borrower’s
quarters thereafter (it being understood that the last month in each of
Borrower’s quarters is January, April, July and October).
     (ii) Intraquarterly Adjusted Quick Ratio. An Adjusted Quick Ratio of at
least (A) 0.95 to 1.00 as of the months ending May 31, 2009 and June 30, 2009,
and (B) 1.00 to 1.00 as of the month ending August 31, 2009 and for each of the
first two months in each of Borrower’s quarters thereafter (it being understood
that the first two months in each of Borrower’s quarters is February, March, May
June, August September, November and December).
     (b) EBITDA. As of the last day of each of Borrower’s fiscal quarters,
Borrower shall have EBITDA for the six-month period

 

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ending on the last day of such quarter of at least (i) Fifteen Million Dollars
($15,000,000.00) for the quarter ending April 30, 2009, (ii) Seven Million Five
Hundred Thousand Dollars ($7,500,000.00) for the quarter ending July 31, 2009,
(iii) Fifteen Million Dollars ($15,000,000.00) for the quarter ending
October 31, 2009, and (iv) Twenty Million Dollars ($20,000,000.00) for the
quarter ending on January 31, 2010 and as of the last day of each quarter
thereafter.”

  10   The Loan Agreement shall be amended by inserting the following new
Section 6.12, appearing immediately after Section 6.11 thereof:

“ 6.12 Accounts Receivable.
     (a) Schedules and Documents Relating to Accounts. During an Asset Based
Period, unless a Streamline Period is then in effect, Borrower shall deliver to
Bank transaction reports and schedules of collections, as provided in
Section 6.2, on Bank’s standard forms; provided, however, that Borrower’s
failure to execute and deliver the same shall not affect or limit Bank’s Lien
and other rights in all of Borrower’s Accounts, nor shall Bank’s failure to
advance or lend against a specific Account affect or limit Bank’s Lien and other
rights therein. If reasonably requested by Bank during an Asset Based Period,
unless a Streamline Period is then in effect, Borrower shall furnish Bank with
copies (or, at Bank’s reasonable request, originals) of all contracts, orders,
invoices, and other similar documents, and all shipping instructions, delivery
receipts, bills of lading, and other evidence of delivery, for any goods the
sale or disposition of which gave rise to such Accounts. In addition, during an
Asset Based Period, unless a Streamline Period is then in effect, Borrower shall
deliver to Bank, on its reasonable request, the originals of all instruments,
chattel paper, security agreements, guarantees and other documents and property
evidencing or securing any Accounts, in the same form as received, with all
necessary endorsements, and copies of all credit memos.
     (b) Disputes. During an Asset Based Period, unless a Streamline Period is
then in effect, Borrower shall promptly notify Bank of all disputes or claims
relating to Accounts. Borrower may forgive (completely or partially),
compromise, or settle any Account for less than payment in full, or agree to do
any of the foregoing so long as (i) Borrower does so in good faith, in a
commercially reasonable manner, in the ordinary course of business, in
arm’s-length transactions, and reports the same to Bank in the regular reports
provided to Bank; (ii) no Default or Event of Default has occurred and is
continuing; and (iii) after taking into account all such discounts, settlements
and forgiveness, the total outstanding Credit Extensions will not exceed the
lesser of the Revolving Line or the Borrowing Base.
     (c) Collection of Accounts. During an Asset Based Period, unless a
Streamline Period is then in effect, all payments on, and proceeds of, Accounts
shall be deposited directly by the applicable Account Debtor into a lockbox
account maintained by Borrower with Bank, and Borrower shall affirmatively
direct each Account Debtor to make all payments to such lockbox. Whether or not
an Event of Default has occurred and is continuing, Borrower shall hold all
payments on, and proceeds of, Accounts in trust for Bank, and Borrower shall
promptly deliver all such payments and proceeds to Bank in their original form,
duly endorsed, to be applied to the Obligations pursuant to the terms of
Section 9.5 hereof.

 

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     (d) Returns. Provided no Event of Default has occurred and is continuing,
during an Asset Based Period, unless a Streamline Period is then in effect, if
any Account Debtor returns any Inventory to Borrower, Borrower shall promptly
(i) determine the reason for such return, (ii) issue a credit memorandum to the
Account Debtor in the appropriate amount to the extent consistent with
Borrower’s customary practices or as otherwise appropriate in Borrower’s
reasonable business judgment, and (iii) provide a copy of such credit memorandum
to Bank, upon request from Bank. In the event any attempted return occurs after
the occurrence and during the continuance of any Event of Default, Borrower
shall hold the returned Inventory in trust for Bank, and immediately notify Bank
of the return of the Inventory.
     (e) Verification. During an Asset Based Period, unless a Streamline Period
is then in effect, after the occurrence and during the continuance of any Event
of Default, Bank may, from time to time, verify directly with the respective
Account Debtors, in a good faith commercially reasonable manner, the validity,
amount and other matters relating to the Accounts, either in the name of
Borrower or Bank or such other name as Bank may choose.
     (f) No Liability. Bank shall not be responsible or liable for any shortage
or discrepancy in, damage to, or loss or destruction of, any goods, the sale or
other disposition of which gives rise to an Account, or for any error, act,
omission; or delay of any kind occurring in the settlement, failure to settle,
collection or failure to collect any Account, or for settling any Account in
good faith for less than the full amount thereof, nor shall Bank be deemed to be
responsible for any of Borrower’s obligations under any contract or agreement
giving rise to an Account. Nothing herein shall, however, relieve Bank from
liability for its own gross negligence or willful misconduct.”

  11   The Loan Agreement shall be amended by deleting the following text,
appearing in Section 8.2 thereof:

“ (a) Borrower fails or neglects to perform any obligation in Sections 6.2, 6.6,
or 6.7, or violates any covenant in Section 7; or”
and inserting in lieu thereof the following:
“ (a) Borrower fails or neglects to perform any obligation in Sections 6.2, 6.6,
6.7 or 6.12, or violates any covenant in Section 7; or”

  12   The Loan Agreement shall be amended by deleting the following text,
appearing in Section 9.5 thereof:

“Unless an Event of Default has occurred and is continuing, Bank shall apply any
funds in its possession, whether from Borrower account balances, payments, or
proceeds realized as the result of any collection of Accounts or other
disposition of the Collateral, first, to Bank Expenses, including without
limitation, the reasonable costs, expenses, liabilities, obligations and
attorneys’ fees incurred by Bank in the exercise of its rights under this
Agreement; second, to the interest due upon any of the Obligations; and third,
to the principal of the Obligations and any applicable fees and other charges,
in such order as Bank shall determine in its sole discretion.”
and inserting in lieu thereof the following:

 

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“Unless an Event of Default has occurred and is continuing, Bank may apply any
funds in its possession, whether from Borrower account balances, payments, or
proceeds realized as the result of any collection of Accounts or other
disposition of the Collateral, first, to Bank Expenses, including without
limitation, the reasonable costs, expenses, liabilities, obligations and
attorneys’ fees incurred by Bank in the exercise of its rights under this
Agreement; second, to the interest due upon any of the Obligations; and third,
to the principal of the Obligations and any applicable fees and other charges,
in such order as Bank shall determine in its sole discretion.”

  13   The Loan Agreement shall be amended by inserting the following new
definitions, appearing alphabetically in Section 13.1 thereof:

“ “2009 Effective Date” is April 30, 2009.”
“ “Asset Based Period” begins immediately when Borrower’s Adjusted Quick Ratio
is less than 1.00 to 1.00 at any time and ends when Bank subsequently receives
satisfactory evidence that Borrower has maintained an Adjusted Quick Ratio at
all times of at least 1.10 to 1.00 for a three consecutive month period. For
sake of clarity, there may be multiple Asset Based Periods during the term of
this Agreement.”
“ “Borrowing Base” is (a) eighty percent (80.0%) of Eligible Accounts, plus
(b) the lesser of (i) sixty-five percent (65.0%) of Eligible Foreign Accounts
and (ii) Five Million Dollars ($5,000,000.00), as determined by Bank from
Borrower’s most recent Borrowing Base Certificate; provided, however, that Bank
may decrease the foregoing amount and/or percentages in its good faith business
judgment based on events, conditions, contingencies, or risks which, as
determined by Bank, may adversely affect Collateral.
“ “Borrowing Base Certificate” is that certain certificate in the form attached
hereto as Exhibit E.”
“ “Eligible Accounts” means Accounts which arise in the ordinary course of
Borrower’s business that meet all Borrower’s representations and warranties in
Section 5.3. Bank reserves the right at any time after the Effective Date to
adjust any of the criteria set forth below and to establish new criteria in its
good faith business judgment. Unless Bank otherwise agrees in writing, Eligible
Accounts shall not include:
     (a) Accounts that the Account Debtor has not paid within ninety (90) days
of invoice date regardless of invoice payment period terms;
     (b) Accounts owing from an Account Debtor, fifty percent (50%) or more of
whose Accounts have not been paid within ninety (90) days of invoice date;
     (c) Accounts owing from an Account Debtor which does not have its principal
place of business in the United States, unless such Accounts are otherwise
Eligible Accounts and covered in full by credit insurance satisfactory to Bank;
     (d) Accounts billed and/or payable outside of the United States;

 

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     (e) Accounts owing from an Account Debtor to the extent that Borrower is
indebted or obligated in any manner to the Account Debtor (as creditor, lessor,
supplier or otherwise — sometimes called “contra” accounts, accounts payable,
customer deposits or credit accounts), with the exception of customary credits,
adjustments and/or discounts given to an Account Debtor by Borrower in the
ordinary course of its business;
     (f) Accounts for which the Account Debtor is Borrower’s Affiliate, officer,
employee, or agent;
     (g) Accounts with credit balances over ninety (90) days from invoice date;
     (h) Accounts owing from an Account Debtor, including Affiliates, whose
total obligations to Borrower exceed twenty-five percent (25%) of all Accounts,
for the amounts that exceed that percentage, unless Bank approves in writing;
     (i) Accounts owing from an Account Debtor which is a United States
government entity or any department, agency, or instrumentality thereof unless
Borrower has assigned its payment rights to Bank and the assignment has been
acknowledged under the Federal Assignment of Claims Act of 1940, as amended;
     (j) Accounts for demonstration or promotional equipment, or in which goods
are consigned, or sold on a “sale guaranteed”, “sale or return”, “sale on
approval”, or other terms if Account Debtor’s payment may be conditional;
     (k) Accounts owing from an Account Debtor that has not been invoiced or
where goods or services have not yet been rendered to the Account Debtor
(sometimes called memo billings or pre-billings);
     (1) Accounts subject to contractual arrangements between Borrower and an
Account Debtor where payments shall be scheduled or due according to completion
or fulfillment requirements where the Account Debtor has a right of offset for
damages suffered as a result of Borrower’s failure to perform in accordance with
the contract (sometimes called contracts accounts receivable, progress billings,
milestone billings, or fulfillment contracts);
     (m) Accounts owing from an Account Debtor the amount of which may be
subject to withholding based on the Account Debtor’s satisfaction of Borrower’s
complete performance (but only to the extent of the amount withheld; sometimes
called retainage billings);
     (n) Accounts subject to trust provisions, subrogation rights of a bonding
company, or a statutory trust;
     (o) Accounts owing from an Account Debtor that has been invoiced for goods
that have not been shipped to the Account Debtor unless Bank, Borrower, and the
Account Debtor have entered into an agreement acceptable to Bank in its sole
discretion wherein the Account Debtor acknowledges that (i) it has title to and
has ownership of the goods wherever located, (ii) a bona fide sale of the goods
has occurred, and (iii) it owes payment for such goods in accordance with
invoices from Borrower (sometimes called “bill and hold” accounts);

 

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     (p) Accounts for which the Account Debtor has not been invoiced;
     (q) Accounts that represent non-trade receivables or that are derived by
means other than in the ordinary course of Borrower’s business;
     (r) Accounts for which Borrower has permitted Account Debtor’s payment to
extend beyond ninety (90) days;
     (s) Accounts subject to chargebacks or others payment deductions taken by
an Account Debtor (but only to the extent the chargeback is determined invalid
and subsequently collected by Borrower);
     (t) Accounts in which the Account Debtor disputes liability or makes any
claim (but only up to the disputed or claimed amount), or if the Account Debtor
is subject to an Insolvency Proceeding, or becomes insolvent, or goes out of
business; and
     (u) Accounts owing from an Account Debtor with respect to which Borrower
has received deferred revenue (but only to the extent of such deferred revenue);
     (v) Accounts for which Bank in its good faith business judgment determines
collection to be doubtful.”
“ “Eligible Foreign Accounts” are Accounts that would be Eligible Accounts but
for the fact that the Account Debtor’s principal place of business is not in the
United States that are approved by Bank in writing in Bank’s sole and absolute
discretion on a case-by-case basis.”
“ “Reserves” means, as of any date of determination, such amounts as Bank may
from time to time establish and revise in good faith reducing the amount of
Advances, Letters of Credit and other financial accommodations which would
otherwise be available to Borrower under the lending formulas: (a) to reflect
events, conditions, contingencies or risks which, as determined by Bank in good
faith, do or may affect (i) the Collateral or any other property which is
security for the Obligations or its value (including without limitation any
increase in delinquencies of Accounts), (ii) the assets or business of Borrower
or any guarantor, or (iii) the security interests and other rights of Bank in
the Collateral (including the enforceability, perfection and priority thereof);
or (b) to reflect Bank’s good faith belief that any collateral report or
financial information furnished by or on behalf of Borrower or any guarantor to
Bank is or may have been incomplete, inaccurate or misleading in any material
respect; or (c) in respect of any state of facts which Bank determines in good
faith constitutes an Event of Default or may, with notice or passage of time or
both, constitute an Event of Default.”
“ “Streamline Period” occurs when, during an Asset Based Period, each of
(a) there are no Obligations outstanding, (b) Borrower has provided a written
request to Bank that there be a Streamline Period, and (c) Borrower agrees that
it will provide Bank with thirty (30) days written notice prior to requesting a
Credit Extension. For sake of clarity, a “Streamline Period” shall be deemed to
be terminated upon the request by Borrower for a Credit Extension.”
“ “Transaction Report” is that certain form attached hereto as Exhibit F.”

 

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  14   The Loan Agreement shall be amended by deleting the following definition,
appearing in Section 13.1 thereof:

“ “Availability Amount” is (a) the Revolving Line minus (b) the amount of all
outstanding Letters of Credit (including drawn, but unreimbursed Letters of
Credit) plus an amount equal to the Letter of Credit Reserves, and minus (c) the
outstanding principal balance of any Advances (including any amounts used for
Cash Management Services), minus (d) the FX Reserve.”

      And inserting in lieu thereof the following:

“ “Availability Amount” is (a) the lesser of (i) the Revolving Line, and
(ii) the Borrowing Base, minus (b) the amount of all outstanding Letters of
Credit (including drawn but unreimbursed Letters of Credit) plus an amount equal
to the Letter of Credit Reserves, and minus (c) the outstanding principal
balance of any Advances (including any amounts used for Cash Management
Services), minus (d) the FX Reserve.”

  15   The Compliance Certificate appearing as Exhibit B to the Loan Agreement
is hereby replaced with the Compliance Certificate attached hereto as
Schedule 1.     16   The Loan Agreement shall be amended by inserting the
Borrowing Base Certificate attached hereto as Schedule 2 as Exhibit E to the
Loan Agreement.     17   The Loan Agreement shall be amended by inserting the
Transaction Report attached hereto as Schedule 3 as Exhibit F to the Loan
Agreement.

4. FEES. Borrower shall pay to Bank a modification fee equal to Seven Thousand
Five Hundred Dollars ($7,500.00), which fee shall be due on the date hereof and
shall be deemed fully earned as of the date hereof. Borrower shall also
reimburse Bank for all legal fees and expenses incurred in connection with this
Loan Modification Agreement.
5. RATIFICATION OF PERFECTION CERTIFICATES.
     (a) Finisar hereby ratifies, confirms and reaffirms, all and singular, the
terms and disclosures contained in a certain Perfection Certificate dated as of
March 14, 2008 between Finisar and Bank, and acknowledges, confirms and agrees
that the disclosures and information Finisar provided to Bank in the Perfection
Certificate have not changed, as of the date hereof.
     (b) Optium hereby ratifies, confirms and reaffirms, all and singular, the
terms and disclosures contained in a certain Perfection Certificate dated as of
October 30, 2008 between Optium and Bank, and acknowledges, confirms and agrees
that the disclosures and information Optium provided to Bank in the Perfection
Certificate have not changed, as of the date hereof.
6. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended wherever
necessary to reflect the changes described above.
7. RATIFICATION OF LOAN DOCUMENTS. Borrower hereby ratifies, confirms, and
reaffirms all terms and conditions of all security or other collateral granted
to the Bank, and confirms that the indebtedness secured thereby includes,
without limitation, the Obligations.
8. NO DEFENSES OF BORROWER. Borrower hereby acknowledges and agrees that
Borrower has no offsets, defenses, claims, or counterclaims against Bank with
respect to the Obligations, or otherwise, and that if Borrower now has, or ever
did have, any offsets, defenses, claims, or counterclaims against Bank, whether
known or

 

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unknown, at law or in equity, all of them are hereby expressly WAIVED and
Borrower hereby RELEASES Bank from any liability thereunder.
9. CONTINUING VALIDITY. Borrower understands and agrees that in modifying the
existing Obligations, Bank is relying upon Borrower’s representations,
warranties, and agreements, as set forth in the Existing Loan Documents. Except
as expressly modified pursuant to this Loan Modification Agreement, the terms of
the Existing Loan Documents remain unchanged and in full force and effect. Bank’
s agreement to modifications to the existing Obligations pursuant to this Loan
Modification Agreement in no way shall obligate Bank to make any future
modifications to the Obligations. Nothing in this Loan Modification Agreement
shall constitute a satisfaction of the Obligations. It is the intention of Bank
and Borrower to retain as liable parties all makers of Existing Loan Documents,
unless the party is expressly released by Bank in writing. No maker will be
released by virtue of this Loan Modification Agreement.
10. COUNTERSIGNATURE. This Loan Modification Agreement shall become effective
only when it shall have been executed by Borrower and Bank.
[The remainder of this page is intentionally left blank]

 

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     This Loan Modification Agreement is executed as a sealed instrument under
the laws of the State of California as of the date first written above.

                      BORROWER:       BANK:    
 
                    FINISAR CORPORATION       SILICON VALLEY BANK    
 
                   
By:
  /s/ S. K. Workman       By:        
 
                   
Name:
  S. K. Workman       Name:        
 
                   
Title:
  CFO       Title:        
 
                   
 
                    OPTIUM CORPORATION                
 
                   
By:
  /s/ S. K. Workman                
 
                   
Name:
  S. K. Workman                
Title:
  CFO                
 
                   

 

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SCHEDULE 1
EXHIBIT B
COMPLIANCE CERTIFICATE

      TO:        SILICON VALLEY BANK   Date:                       

FROM: FINISAR CORPORATION and OPTIUM CORPORATION
          The undersigned authorized officer of FINISAR CORPORATION and OPTIUM
CORPORATION (“Borrower”) certifies that under the terms and conditions of the
Loan and Security Agreement between Borrower and Bank (as amended, the
“Agreement”), (1) Borrower is in complete compliance for the period ending
                     with all required covenants except as noted below,
(2) there are no Events of Default, (3) all representations and warranties in
the Agreement are true and correct in all material respects on this date except
as noted below; provided, however, that such materiality qualifier shall not be
applicable to any representations and warranties that already are qualified or
modified by materiality in the text thereof; and provided, further that those
representations and warranties expressly referring to a specific date shall be
true, accurate and complete in all material respects as of such date, (4)
Borrower, and each of its Subsidiaries, has timely filed all required tax
returns and reports, and Borrower has timely paid all foreign, federal, state
and local taxes, assessments, deposits and contributions owed by Borrower except
as otherwise permitted pursuant to the terms of Section 5.8 of the Agreement,
and (5) no Liens have been levied or claims made against Borrower or any of its
Subsidiaries relating to unpaid employee payroll or benefits of which Borrower
has not previously provided written notification to Bank, Attached are the
required documents supporting the certification. The undersigned certifies that
these are prepared in accordance with GAAP consistently applied from one period
to the next except as explained in an accompanying letter or footnotes. The
undersigned acknowledges that no borrowings may be requested at any time or date
of determination that Borrower is not in compliance with any of the terms of the
Agreement, and that compliance is determined not just at the date this
certificate is delivered. Capitalized terms used but not otherwise defined
herein shall have the meanings given them in the Agreement.
Please indicate compliance status by circling Yes/No under “Complies” column.

          Reporting Covenant   Required   Complies
Monthly Financial Statements and Compliance Certificate
  Monthly within 30 days   Yes   No
 
       
Annual financial statements (CPA Audited) on 10-K
  Annually, upon the earlier of 5 days after filing Form 10-K with SEC or
90 days after FYE   Yes   No
 
       
10-Q
  Quarterly, within 5 days after filing with SEC or 45 days after quarter  
Yes   No
 
       
8-K
  Within 5 days after SEC filing   Yes   No
 
       
Board approved projections
  As requested by Bank   Yes   No
 
       
Borrowing Base Certificate and accounts receivable and accounts payable agings
  Monthly within 30 days   Yes   No
 
       
Transaction Report
  Weekly during Asset Based Period   Yes   No
N/A

              Financial Covenant   Required   Actual   Complies
Adjusted Quick Ratio (tested monthly)
     :1.00 *    :1.00   Yes   No
 
           
Rolling Two-Quarter EBITDA (tested quarterly)
  $                     * $                       Yes   No

 

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*   As set forth in Section 6.7 of the Agreement.

                    The following financial covenant analyses and information
set forth in Schedule 1 attached hereto are true and accurate as of the date of
this Certificate.
          The following are the exceptions with respect to the certification
above: (If no exceptions exist, state “No exceptions to note.”)
 
 
 

                      FINISAR CORPORATION       BANK USE ONLY    
 
                   
By:
          Received by:        
 
                   
Name:
              AUTHORIZED SIGNER    
 
                   
Title:
          Date:        
 
                   
 
          Verified:        
 
                   
 
              AUTHORIZED SIGNER    
 
                    OPTIUM CORPORATION       Date:        
 
                                Compliance Status:                Yes     No    
By:
                   
 
                   
Name:
                   
 
                   
Title:
                   
 
                   

 

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Schedule 1 to Compliance Certificate
Financial Covenants of Borrower
Dated:                     
In the event of a conflict between this Schedule and the Loan Agreement, the
terms of the Loan Agreement shall control.
I. Adjusted Quick Ratio (Section 6.7(a))

     
Required:
       : 1.00*
 
   
Actual:
       : 1.00

         
A. Aggregate value of the unrestricted cash and Cash Equivalents of Borrower
  $    
 
       
 
       
B. Aggregate value of the net billed trade accounts receivable of Borrower
  $    
 
       
 
       
C. Investments of Borrower
  $    
 
       
 
       
D. Quick Assets (the sum of lines A through C)
  $    
 
       
 
       
E. Aggregate value of liabilities of Borrower (including all Indebtedness to
Bank) that mature within one (1) year and current portion of Subordinated Debt
permitted by Bank to be paid by Borrower
  $    
 
       
 
       
F. Current Liabilities (line E))
  $    
 
       
 
       
G. Deferred Revenue
  $    
 
       
 
       
H. Current portion of convertible subordinated notes to be paid by Borrower
  $    
 
       
 
       
I. Line F minus line G and minus line H
  $    
 
       
 
       
J. Adjusted Quick Ratio (line D divided by line I)
       
 
       

Is line J equal to or greater than      : 1.00*?
See Section 6.7(a)

     
                                No, not in compliance
                       Yes, in compliance

II. EBITDA (Section 6.7(b))

     
Required:
  $                    * (for prior two quarters)
 
   
Actual:
  $                    

Is EBITDA for prior two quarters at least $                     *?
 

*   See Section 6.7(b)

 

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                               No, not in compliance
                       Yes, in compliance

 

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SCHEDULE 2
EXHIBIT E
BORROWING BASE CERTIFICATE
Borrower: Finisar Corporation and Optium Corporation
Lender: Silicon Valley Bank
Commitment Amount:       $45,000,000.00

         
ACCOUNTS RECEIVABLE
       
1. Accounts Receivable Book Value as of
                                             
  $    
 
       
2. Additions (please explain on reverse)
  $    
 
       
3. TOTAL ACCOUNTS RECEIVABLE
  $    
 
       
 
       
ACCOUNTS RECEIVABLE DEDUCTIONS (without duplication)
       
4. Amounts over 90 days due
  $    
 
       
5. Balance of 50% over 90 day accounts
  $    
 
       
6. Credit balances over 90 days
  $    
 
       
7. Concentration Limits
  $    
 
       
8. Foreign Accounts
  $    
 
       
9. Governmental Accounts
  $    
 
       
10. Contra Accounts
  $    
 
       
11. Promotion or Demo Accounts
  $    
 
       
12. Intercompany/Employee Accounts
  $    
 
       
13. Disputed Accounts
  $    
 
       
14. Deferred Revenue
  $    
 
       
15. Other (please explain on reverse)
  $    
 
       
16. TOTAL ACCOUNTS RECEIVABLE DEDUCTIONS
  $    
 
       
17. Eligible Accounts (#3 minus #16)
  $    
 
       
18. ELIGIBLE AMOUNT OF ACCOUNTS (80% of #17)
  $    
 
       
19. Eligible Foreign Accounts
  $    
 
       
20. ELIGIBLE AMOUNT OF ELIGIBLE FOREIGN ACCOUNTS (lesser of (a) 65% of #19, and
(b) $5,000,000))
  $    
 
       
 
       
BALANCES
       
21. Maximum Loan Amount
  $    
 
       
22. Total Funds Available Lesser of #21 or (#18 plus #20)
  $    
 
       
23. Present balance owing on Line of Credit
  $    
 
       
24. Outstanding under Sublimits
  $    
 
       
25. RESERVE POSITION (#22 minus #23 and #24)
  $    
 
       
 
       
TO BE COMPLETED IF CREDIT EXTENSIONS EXCEED $25,000,000.00
       
 
       
1. Unrestricted Cash on Balance Sheet
  $    
 
       
2. Amount of Credit Extensions Outstanding
  $    
 
       
3. #1 minus #2
  $    
 
       

Is #3 at least $50,000,000.00?   Yes   No*
 

*   If not, paydown is required pursuant to Section 2.2

The undersigned represents and warrants that this is true, complete and correct,
and that the information in this Borrowing Base Certificate complies with the
representations and warranties in the Loan and Security Agreement between the
undersigned and Silicon Valley Bank.

 

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      COMMENTS:
 
   
 
    FINISAR CORPORATION OPTIUM CORPORATION
 
   
 
   
 
    By:    
 
    Authorized Signer
 
    Date:  

      BANK USE ONLY
Received by:           AUTHORIZED SIGNER Date:           Verified:          
AUTHORIZED SIGNER       Date:           Compliance Status:           Yes      
No

 

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SCHEDULE 3
EXHIBIT F
Transaction Report
[EXCEL spreadsheet to be provided separately from lending officer.]