EX-10.1



 Exhibit 10.1 

SIXTH AMENDMENT 
 TO

 SECOND AMENDED AND RESTATED 

LOAN AND SECURITY AGREEMENT 

This Sixth Amendment to Second Amended and Restated Loan and Security Agreement (this “Amendment”) is entered into this
5th day of October, 2015 (the “Sixth Amendment Effective Date”), by and between Silicon Valley Bank (“Bank”), SONIC FOUNDRY, INC., Maryland corporation (“Sonic Foundry”), and SONIC
FOUNDRY MEDIA SYSTEMS, INC., a Maryland corporation (“Sonic Systems” and together with Sonic Foundry, jointly and severally, individually and collectively, the “Borrower”). 

RECITALS 

A. Bank and Borrower have entered into that certain Second Amended and Restated Loan and Security Agreement, dated as of June 27,
2011, as amended by that certain First Amendment, dated as of May 31, 2013, as further amended by that certain Second Amendment, dated as of January 10, 2014, as further amended by that certain Third Amendment, dated as of March 24,
2014, as further amended by that certain Fourth Amendment, dated as of January 27, 2015 and as further amended by that certain Fifth Amendment, dated as of May 13, 2015 (as the same may from time to time be further amended, modified,
supplemented or restated, the “Loan Agreement”). 
 B. Bank has extended credit to Borrower for the purposes
permitted in the Loan Agreement. 
 C. Borrower has requested that Bank amend the Loan Agreement to (i) revise the financial
covenants and (iii) make certain other revisions to the Loan Agreement as more fully set forth herein. 
 D. Bank has agreed to
so amend certain provisions of the Loan Agreement, but only to the extent, in accordance with the terms, subject to the conditions of, and in reliance upon, the representations and warranties set forth below. 

AGREEMENT 

NOW, THEREFORE, in consideration of the foregoing recitals and other good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged, and intending to be legally bound, the parties hereto agree as follows: 
 1.
Definitions. Capitalized terms used but not defined in this Amendment shall have the meanings given to them in the Loan Agreement. 

2. Amendments to Loan Agreement. 

2.1 Section 6.9(a) (Financial Covenants). Sections 6.9(a) is amended in its entirety and replaced with the following: 

  
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 “(a) Liquidity. Liquidity, at all times, tested with respect to Borrower only on a
monthly basis, of at least 1.50:1.00.” 
 2.2 Section 6.9(b) (Financial Covenants). Section 6.9(b) is amended in its
entirety and replaced with the following: 
 “(b) Minimum EBITDA. Commencing with the period ending September 30, 2015,
measured as of the last day of each fiscal quarter, on a trailing six (6) month basis ending as of the date of measurement, (i) EBITDA plus (ii) the net change in Deferred Revenue during such measurement period, of at least
$1.00.” 
 2.3 Section 13.1 (Definitions). The following new terms and their respective definitions are hereby inserted in
Section 13.1, each in its applicable alphabetical order: 
 “Sixth Amendment Effective Date” is September 30,
2015. 
 2.4 Section 13.1 (Definitions). The following terms and their respective definitions are hereby deleted in their
entirety from Section 13.1: 
 “Debt Service” means, for any period of measurement, all regularly scheduled payments of
principal and interest of Indebtedness of Borrower and its Subsidiaries, other than Permitted Earnout Payments, determined on a consolidated basis due within the trailing twelve (12) month period ended as of such date of measurement. 

“Debt Service Coverage Ratio” is defined in Section 6.9(b). 

2.5 Compliance Certificate. The Compliance Certificate attached as Exhibit C to the Loan Agreement is deleted in its entirety
and replaced with Exhibit A attached hereto. 
 3. Limitation of Amendments. 

3.1 The amendments set forth in Section 2, above, are effective for the purposes set forth herein and shall be limited
precisely as written and shall not be deemed to (a) be a consent to any amendment, waiver or modification of any other term or condition of any Loan Document, or (b) otherwise prejudice any right or remedy which Bank may now have or may
have in the future under or in connection with any Loan Document. 
 3.2 This Amendment shall be construed in connection with and as
part of the Loan Documents and all terms, conditions, representations, warranties, covenants and agreements set forth in the Loan Documents, except as herein amended, are hereby ratified and confirmed and shall remain in full force and effect. 

4. [Reserved]. 
 5.
Representations and Warranties. To induce Bank to enter into this Amendment, Borrower hereby represents and warrants to Bank as follows: 

  
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 5.1 Immediately after giving effect to this Amendment (a) the representations and
warranties contained in the Loan Documents are true, accurate and complete in all material respects as of the date hereof (except to the extent such representations and warranties relate to an earlier date, in which case they are true and correct as
of such date), and (b) no Event of Default has occurred and is continuing; 
 5.2 Borrower has the power and authority to
execute and deliver this Amendment and to perform its obligations under the Loan Agreement, as amended by this Amendment; 
 5.3 The
organizational documents of Borrower previously delivered to Bank remain true, accurate and complete and have not been amended, supplemented or restated and are and continue to be in full force and effect, or updated copies have otherwise been
delivered to Bank in connection with the execution of this Amendment; 
 5.4 The execution and delivery by Borrower of this Amendment
and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Amendment, have been duly authorized; 

5.5 The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, do not and will not contravene (a) any law or regulation binding on or affecting Borrower, (b) any contractual restriction with a Person binding on Borrower, (c) any order, judgment or decree
of any court or other governmental or public body or authority, or subdivision thereof, binding on Borrower, or (d) the organizational documents of Borrower; 

5.6 The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, do not require any order, consent, approval, license, authorization or validation of, or filing, recording or registration with, or exemption by any governmental or public body or authority, or subdivision
thereof, binding on either Borrower, except as already has been obtained or made; and 
 5.7 This Amendment has been duly executed
and delivered by Borrower and is the binding obligation of Borrower, enforceable against Borrower in accordance with its terms, 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. 
 6. Ratification
of Intellectual Property Security Agreement. Borrower hereby ratifies, confirms and reaffirms, all and singular, the terms and conditions of a certain Amended and Restated Intellectual Property Security Agreement dated as of May 13, 2015
between Borrower and Bank, and acknowledges, confirms and agrees that said Intellectual Property Security Agreement (a) contains an accurate and complete listing of all Intellectual Property Collateral, as defined in said Intellectual Property
Security Agreement, and (b) shall remain in full force and effect. 
 7. Ratification of Perfection Certificate. Borrower
hereby ratifies, confirms and 

  
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reaffirms, all and singular, the terms and disclosures contained in a certain Perfection Certificate dated as of May 13, 2015 between Borrower and Bank, and acknowledges, confirms and agrees
the disclosures and information Borrower provided to Bank in said Perfection Certificate have not changed, as of the date hereof. 

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 unknown, at law or in equity, all of them are
hereby expressly WAIVED and Borrower hereby RELEASES Bank from any liability thereunder. 
 9. Integration. This Amendment and the
Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements. All prior agreements, understandings, representations, warranties, and negotiations between the parties about the subject matter
of this Amendment and the Loan Documents merge into this Amendment and the Loan Documents. 
 10. Counterparts. This Amendment may be
executed in any number of counterparts and all of such counterparts taken together shall be deemed to constitute one and the same instrument. 

11. Effectiveness. This Amendment shall be deemed effective upon (a) the due execution and delivery to Bank of this Amendment by
each party hereto, (b) updated Secretary’s Corporate Borrowing Certificates for each Borrower (with updated attachments, if necessary), (c) an acknowledgment and reaffirmation of the existing Subordination Agreements, (d) payment
by Borrower of a non-refundable amendment fee equal to Ten Thousand Dollars ($10,000), which amendment fee shall be fully-earned as of the date hereof, and (e) payment of Bank’s legal fees and expenses incurred in connection with the
existing Loan Documents and this Amendment. 
 12. Post-Closing Matters. On or before June 16, 2016, Borrower shall pay to Bank
an additional fully earned, non-refundable Revolving Line anniversary fee in an amount equal to Twenty Six Thousand Six Hundred Sixty Seven Dollars ($26,667). 

[Signature page follows.] 

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

			
	BANK
	
	SILICON VALLEY BANK
		
	By	 	/s/ Tom Hertzberg
	Name:	 	Tom Hertzberg
	Title:	 	Vice President

  

			
	BORROWER
	
	SONIC FOUNDRY, INC.
		
	By	 	/s/ Ken Minor
	Name:	 	Ken Minor
	Title:	 	CFO

  

			
	SONIC FOUNDRY MEDIA SYSTEMS, INC.
		
	By	 	/s/ Ken Minor
	Name:	 	Ken Minor
	Title:	 	CFO








 Exhibit A to Sixth Amendment 

EXHIBIT C 

COMPLIANCE CERTIFICATE 
  

					
	TO:	 	SILICON VALLEY BANK	  	Date:                                     
   
	FROM:	 	SONIC FOUNDRY, INC.	  	
		 	SONIC FOUNDRY MEDIA SYSTEMS, INC.	  	

 The undersigned authorized officer of SONIC FOUNDRY, INC. and SONIC FOUNDRY MEDIA SYSTEMS, INC.
(“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 5.9 of the Agreement, and (5) no Liens have been levied or claims made against Borrower or any of its Subsidiaries, if any, 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 with Compliance Certificate	  	Monthly within 30 days	  	Yes    No
	Annual financial statement (CPA Audited) + CC	  	FYE within 120 days	  	Yes    No
	10-Q, 10-K and 8-K	  	Within 5 days after filing with SEC	  	Yes    No
	A/R & A/P Agings	  	Monthly within 15 days	  	Yes    No
	Transaction Reports	  	Monthly within 15 days and with each request for a Credit Extension	  	Yes    No
	Projections	  	Within fifteen (15) following approval by the Borrower’s board of directors, and in any event within fifteen (15) days after the end of each fiscal year of Borrower, and as amended and/or updated	  	Yes    No








 The following Intellectual Property was registered after the Effective Date (if no registrations, state
“None”) 
  

													
	 Financial Covenant
	  	 Required
	 	  	 Actual
	 	  	 Complies
	 
	 Maintain as indicated:
	  				  				  			
	 Minimum Liquidity (monthly)
	  	 	1.50:1.00	  	  	 	            :1.0	  	  	 	Yes     No	  
	 Minimum EBITDA (quarterly)
	  	>$	1.00	  	  	$	            	  	  	 	Yes     No	  
	 Maximum Subsidiary Indebtedness (at all times)
	  	<$	500,000	  	  	$	            	  	  	 	Yes     No	  

 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.”) 
  

	
	  

	
	  

	
	  


  

							
	SONIC FOUNDRY, INC.	 		 	BANK USE ONLY
	SONIC FOUNDRY MEDIA SYSTEMS, INC.	 		 	
		 		 	Received by:
                                        

		 		 	                          AUTHORIZED SIGNER
				
	By:	 	  
	 		 	Date:
                                         
             
	Name:	 	  
	 		 	
	Title:	 	  
	 		 	Verified:
                                         
         
		 		 		 	                          AUTHORIZED SIGNER
				
		 		 		 	Date:
                                         
             
				
		 		 		 	Compliance Status:     Yes        No








 Schedule 1 to Compliance Certificate 

Financial Covenants of Borrower 

In the event of a conflict between this Schedule and the Loan Agreement, the terms of the Loan Agreement shall govern. 

Dated:
                             
  

	I.	Liquidity (Section 6.9(a)) 

 Required: Liquidity, at all times, tested with respect to Borrower only on
a monthly basis, of at least 1.50:1.00. 
 Actual: 
  

							
	    A.	  	Aggregate value of Borrower’s unrestricted cash at Bank	  	$	            	  
			
	    B.	  	Aggregate value of the net billed accounts receivable of Borrower	  	$	 	  
			
	    C.	  	Quick Assets (the sum of lines A plus B)	  	$	 	  
			
	    D.	  	Aggregate value of Obligations to Bank	  	$	 	  
			
	    J.	  	LIQUIDITY (line C divided by line D), expressed as a ratio	  	 	            :1.00	  

 Is line J equal to or greater than         :1:50? 

 

			
	             No, not in compliance	  	             Yes, in compliance









	II.	Minimum EBITDA (Section 6.9(b)) 

 Required: Commencing with the period ending September 30, 2015,
measured as of the last day of each fiscal quarter, on a trailing six (6) month basis ending as of the date of measurement, (i) EBITDA plus (ii) the net change in Deferred Revenue during such measurement period, of at least
$1.00. 
 Actual: All amounts measured on a trailing six (6) month basis 
  

							
	     A.
	  	EBITDA	  	$	            	  
			
	     B.
	  	The net change in Deferred Revenue	  	$	            	  

 Is line A plus line B equal to or greater than $1.00? 

 

			
	            No, not in compliance.	  	            Yes, in compliance.