Loan and Security Agreement - Silicon Valley Bank



 Exhibit 10.11 
 LOAN AND SECURITY AGREEMENT 
 THIS LOAN AND
SECURITY AGREEMENT (this “Agreement”) dated as of December 2, 2009 (the “Effective Date”) between SILICON VALLEY BANK, a California corporation (“Bank”), and BECEEM COMMUNICATIONS
INC., a Delaware corporation (“Borrower”), provides the terms on which Bank shall lend to Borrower and Borrower shall repay Bank. The parties agree as follows: 
 1 ACCOUNTING AND OTHER TERMS 
 Accounting terms not defined in this Agreement shall be construed following GAAP. Calculations and determinations must be made following GAAP. Capitalized terms not otherwise defined in this Agreement
shall have the meanings set forth in Section 13. All other terms contained in this Agreement, unless otherwise indicated, shall have the meaning provided by the Code to the extent such terms are defined therein. 
 2 LOAN AND TERMS OF PAYMENT 
 2.1 Promise to Pay. 
 Borrower hereby unconditionally promises to pay
Bank the outstanding principal amount of all Credit Extensions and accrued and unpaid interest thereon as and when due in accordance with this Agreement. 
 2.1.1 Revolving Advances. 
 (a) Availability. Subject to the
terms and conditions of this Agreement and to deduction of Reserves, Bank shall make advances against the Borrowing Base (“Formula Advances”) not exceeding the Availability Amount. Amounts borrowed hereunder may be repaid and, prior
to the Revolving Line Maturity Date, reborrowed, subject to the applicable terms and conditions precedent herein. 
 (b)
Streamline Period. At any time in which (i) there are no outstanding Obligations or (ii) Borrower’s Adjusted Quick Ratio is greater than or equal to 1.50 to 1.00, Borrower may, at its option, elect to be in a streamline period
(each, a “Streamline Period”). At least ten (10) days prior to requesting that a Streamline Period be put into effect, Borrower shall give Bank written notice thereof, specifying the date the Streamline Period is to begin. On
or prior to the Business Day immediately preceding the commencement of the Streamline Period, Borrower will either (x) provide evidence satisfactory to Bank that Borrower’s Adjusted Quick Ratio is greater than or equal to 1.50 to 1.00, or
(y) pay to Bank, by wire transfer, an amount sufficient to repay in full all Obligations including all Credit Extensions made pursuant Sections 2.1.2, 2.1.3, and 2.1.4. Any Streamline Period elected by Borrower pursuant to clause (x) above
will immediately terminate if Borrower’s Adjusted Quick Ratio is at any time less than 1.50 to 1.00. During any Streamline Period elected by Borrower pursuant to clause (y) above, Borrower may not request any Credit Extensions, and Bank
shall have no obligation to make any Credit Extensions. To terminate a Streamline Period, Borrower shall provide Bank at least thirty (30) days prior written notice thereof together with such information relating to the Eligible Accounts and
other Collateral as Bank may specify. 







 (c) Termination; Repayment. The Revolving Line terminates on the Revolving Line
Maturity Date, when the principal amount of all Advances, the unpaid interest thereon, and all other Obligations relating to the Revolving Line shall be immediately due and payable. 
 2.1.2 Letters of Credit Sublimit. 
 (a) As part of the Revolving Line, Bank shall issue or have issued Letters of Credit denominated in Dollars or a Foreign Currency for Borrower’s account. The aggregate Dollar Equivalent amount
utilized for the issuance of Letters of Credit shall at all times reduce the amount otherwise available for Advances under the Revolving Line. The aggregate Dollar Equivalent of the face amount of outstanding Letters of Credit (including drawn but
unreimbursed Letters of Credit and any Letter of Credit Reserve) may not exceed the lesser of (i) the sum of (A) Three Million Five Hundred Thousand Dollars ($3,500,000), minus (B) all amounts used for Cash Management Services, and
minus (C) the FX Reduction Amount, or (ii) the sum of (A) the lesser of Revolving Line or the Borrowing Base, minus (B) all outstanding principal amounts of any Advances (including any amounts used for Cash Management Services),
and minus (C) the FX Reduction Amount. 
 (b) If, on the Revolving Line Maturity Date (or the effective date of any
termination of this Agreement), there are any outstanding Letters of Credit, then on such date Borrower shall provide to Bank cash collateral in an amount equal to 105% of the Dollar Equivalent of the face amount of all such Letters of Credit plus
all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its good faith business judgment), to secure all of the Obligations relating to such Letters of Credit. All Letters of Credit shall be in form and
substance acceptable to Bank in its sole discretion and shall be subject to the terms and conditions of Bank’s standard Application and Letter of Credit Agreement (the “Letter of Credit Application”). Borrower agrees to execute
any further documentation in connection with the Letters of Credit as Bank may reasonably request. Borrower further agrees to be bound by the regulations and interpretations of the issuer of any Letters of Credit guarantied by Bank and opened for
Borrower’s account or by Bank’s interpretations of any Letter of Credit issued by Bank for Borrower’s account, and Borrower understands and agrees that Bank shall not be liable for any error, negligence, or mistake, whether of
omission or commission, in following Borrower’s instructions or those contained in the Letters of Credit or any modifications, amendments, or supplements thereto. 
 (c) The obligation of Borrower to immediately reimburse Bank for drawings made under Letters of Credit shall be absolute, unconditional, and irrevocable, and shall be performed strictly in accordance with
the terms of this Agreement, such Letters of Credit, and the Letter of Credit Application. 
  

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 2.1.3 Foreign Exchange Sublimit. 
 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”). FX Forward Contracts shall have a Settlement Date of at least one (1) FX Business
Day after the contract date and shall be subject to a reserve of ten percent (10%) of each outstanding FX Forward Contract (the “FX Reserve”). The aggregate amount of FX Forward Contracts at any one time may not exceed ten
(10) times the lesser of (a) the sum of (i) Three Million Five Hundred Thousand Dollars ($3,500,000), minus (ii) all amounts used for Cash Management Services, and minus (iii) the Dollar Equivalent of the face amount of any
outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), or (b) the sum of (i) the lesser of Revolving Line or the Borrowing Base, minus (ii) all outstanding principal amounts of any Advances (including any
amounts used for Cash Management Services), and minus (iii) the Dollar Equivalent of the face amount of any outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit). The amount otherwise available for Credit Extensions
under the Revolving Line shall be reduced by an amount equal to ten percent (10%) of each outstanding FX Forward Contract (the “FX Reduction Amount”). Any amounts needed to fully reimburse Bank for any amounts not paid by
Borrower in connection with FX Forward Contracts will be treated as Advances under the Revolving Line and will accrue interest at the interest rate applicable to Advances. 
 2.1.4 Cash Management Services Sublimit. 
 Borrower may use the Revolving Line for Bank’s cash management services, which may include merchant services, direct deposit of payroll, business credit card, and check cashing services identified in
Bank’s various cash management services agreements (collectively, the “Cash Management Services”), in an aggregate amount not to exceed the lesser of (a) the sum of (i) Three Million Five Hundred Thousand Dollars
($3,500,000), minus (ii) the Dollar Equivalent of the face amount of any outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), and minus (iii) the FX Reduction Amount, or (b) the sum of (i) the
lesser of Revolving Line or the Borrowing Base, minus (ii) all outstanding principal amounts of any Advances, minus (iii) the Dollar Equivalent of the face amount of any outstanding Letters of Credit (including drawn but unreimbursed
Letters of Credit), and minus (iv) the FX Reduction Amount. Any amounts Bank pays on behalf of Borrower for any Cash Management Services will be treated as Advances under the Revolving Line and will accrue interest at the interest rate
applicable to Advances. 
 2.1.5 Non Formula Line of Credit. 
 As part of the Revolving Line, Borrower shall make non formula advances (the “Non Formula Advance”) to Borrower in an
aggregate amount not to exceed the lesser of (a) One Million Two Hundred Fifty Thousand Dollars ($1,250,000), or (b) the sum of (i) the lesser of Revolving Line or the Borrowing Base, minus (ii) the sum of all outstanding
principal amounts of any Formula Advances, minus (iii) the Dollar Equivalent of the face amount of any outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), and minus (iv) the FX Reduction Amount. The dollar
amount of each Non Formula Advance shall at all times reduce the amount otherwise available for Advances under the Revolving Line. 
  

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 2.2 Overadvances. 
 If, at any time, (a) the sum of (i) the outstanding principal amount of any Formula 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), plus (iii) the FX Reduction Amount, exceeds the lesser of the Revolving Line or the Borrowing Base,
or (b) the sum of (i) the outstanding principal amount of any Formula Advances (including any amounts used for Cash Management Services) and Non-Formula Advances, plus (ii) the face amount of any outstanding Letters of Credit
(including drawn but unreimbursed Letters of Credit), plus (iii) the FX Reduction Amount (each such sum set forth in (a) and (b) above being an “Overadvance”) exceeds the Revolving Line, Borrower shall immediately pay
to Bank in cash such Overadvance. Without limiting Borrower’s obligation to repay Bank any amount of the Overadvance, Borrower agrees to pay Bank interest on the outstanding amount of any Overadvance, on demand, at the Default Rate. 

2.3 Payment of Interest on the Credit Extensions. 
 (a) Advances. Subject to Section 2.3(b), the principal amount outstanding under the Revolving Line shall accrue interest at a floating
per annum rate equal to the sum of (i) the greater of (A) the Prime Rate or (B) four percent (4%), plus (ii) the Applicable Margin, which interest shall be payable monthly in accordance with Section 2.3(e) below.

 (b) Default Rate. Immediately upon the occurrence and during the continuance of an Event of Default, Obligations shall
bear interest at a rate per annum which is four percentage points (4%) above the rate that is otherwise applicable thereto (the “Default Rate”) unless Bank otherwise elects from time to time in its sole discretion to impose a
smaller increase. Fees and expenses which are required to be paid by Borrower pursuant to the Loan Documents (including, without limitation, Bank Expenses) but are not paid when due shall bear interest until paid at a rate equal to the highest rate
applicable to the Obligations. Payment or acceptance of the increased interest rate provided in this Section 2.3(b) is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise
prejudice or limit any rights or remedies of Bank. 
 (c) Adjustment to Interest Rate. Changes to the interest rate of
any Credit Extension based on changes to the Prime Rate shall be effective on the effective date of any change to the Prime Rate and to the extent of any such change. 
 (d) Debit of Accounts. Bank may debit any of Borrower’s deposit accounts, including the Designated Deposit Account, for principal and interest payments or any other amounts Borrower owes Bank
when due. These debits shall not constitute a set-off. 
 (e) Payment; Interest Computation; Float Charge. Interest is
payable monthly on the last calendar day of each month and shall be computed on the basis of a 360-day year for the actual number of days elapsed. In computing interest, (i) all Payments received after 12:00 p.m. Pacific time on any day shall
be deemed received at the opening of business on the next

  

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Business Day, and (ii) the date of the making of any Credit Extension shall be included and the date of payment shall be excluded; provided, however, that if any Credit Extension is
repaid on the same day on which it is made, such day shall be included in computing interest on such Credit Extension. In addition, with respect to payments made by check, 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 Advances whether or not any Advances are outstanding, on all Payments received by Bank. The float charge for each month shall be payable on the last day of
the month. Bank shall not, however, be required to credit Borrower’s account for the amount of any item of payment which is unsatisfactory to Bank in its good faith business judgment, and Bank may charge Borrower’s Designated Deposit
Account for the amount of any item of payment which is returned to Bank unpaid. 
 2.4 Fees. 
 Borrower shall pay to Bank: 
 (a) Letter of Credit Fee. Bank’s reasonable and customary fees and expenses for the issuance or renewal of Letters of Credit, upon the issuance of such Letter of Credit, each anniversary of the issuance during the term of such
Letter of Credit, and upon the renewal of such Letter of Credit by Bank; and 
 (b) Bank Expenses. All Bank Expenses
(including reasonable attorneys’ fees and expenses for documentation and negotiation of this Agreement which fees for the documentation and negotiation of this Agreement will not exceed $7,500 as of the Effective Date so long as negotiations
are not protracted, plus expenses) incurred through and after the Effective Date, when due. 
 2.5 Payments; Application of
Payments. 
 (a) All payments (including prepayments) to be made by Borrower under any Loan Document shall be made in
immediately available funds in U.S. Dollars, without setoff or counterclaim, before 12:00 p.m. Pacific time on the date when due. Payments of principal and/or interest received after 12:00 p.m. Pacific time are considered received at the opening of
business on the next Business Day. When a payment is due on a day that is not a Business Day, the payment shall be due the next Business Day, and additional fees or interest, as applicable, shall continue to accrue until paid. 
 (b) Borrower shall have no right to specify the order or the accounts to which Bank shall allocate or apply any payments required to be made
by Borrower to Bank or otherwise received by Bank under this Agreement when any such allocation or application is not specified elsewhere in this Agreement. 
 3 CONDITIONS OF LOANS 
 3.1 Conditions Precedent to Initial
Credit Extension. 
 Bank’s obligation to make the initial Credit Extension is subject to the condition precedent
that Bank shall have received, in form and substance satisfactory to Bank, such documents, and completion of such other matters, as Bank may reasonably deem necessary or appropriate, including, without limitation: 
 (a) duly executed original signatures to the Loan Documents; 
  


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 (b) duly executed original signatures to the Control Agreements; 
 (c) Borrower’s Operating Documents and a good standing certificate of Borrower certified by the Secretary of State of the State of
Delaware as of a date no earlier than thirty (30) days prior to the Effective Date; 
 (d) duly executed original
signatures to the completed Borrowing Resolutions for Borrower; 
 (e) duly executed original signature to a payoff letter from
Comerica Bank; 
 (f) evidence that (i) the Liens securing Indebtedness owed by Borrower to Comerica Bank will be
terminated and (ii) the documents and/or filings evidencing the perfection of such Liens, including without limitation any financing statements and/or control agreements, have or will, concurrently with the initial Credit Extension, be
terminated; 
 (g) certified copies, dated as of a recent date, of financing statement searches, as Bank shall request,
accompanied by written evidence (including any UCC termination statements) that the Liens indicated in any such financing statements either constitute Permitted Liens or have been or, in connection with the initial Credit Extension, will be
terminated or released; 
 (h) the Perfection Certificate(s) of Borrower, together with the duly executed original signature
thereto; 
 (i) evidence satisfactory to Bank that the insurance policies required by Section 6.7 hereof are in full
force and effect, together with appropriate evidence showing lender loss payable and/or additional insured clauses or endorsements in favor of Bank; 
 (j) the completion of the Initial Audit with results satisfactory to Bank in its sole and absolute discretion at least thirty (30) days prior to the Funding Date of the initial Credit Extension; and

 (k) payment of the fees and Bank Expenses then due as specified in Section 2.4 hereof. 
 3.2 Conditions Precedent to all Credit Extensions. 
 Bank’s obligations to make each Credit Extension, including the initial Credit Extension, is subject to the following conditions
precedent: 
 (a) except as otherwise provided in Section 3.4(a), timely receipt of an executed Transaction Report; 

 

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 (b) the representations and warranties in this Agreement shall be true, accurate, and
complete in all material respects on the date of the Transaction Report and on the Funding Date of each Credit Extension; 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, and
no Event of Default shall have occurred and be continuing or result from the Credit Extension. Each Credit Extension is Borrower’s representation and warranty on that date that the representations and warranties in this Agreement remain true,
accurate, and complete in all material respects; 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; and 
 (c) in Bank’s sole discretion, there has not been any material impairment in the general affairs, management, results of operation,
financial condition or the prospect of repayment of the Obligations, or any material adverse deviation by Borrower from the most recent business plan of Borrower presented to and accepted by Bank. 
 3.3 Covenant to Deliver. 
 Borrower agrees to deliver to Bank each item required to be delivered to Bank under this Agreement as a condition precedent to any Credit Extension. Borrower expressly agrees that a Credit Extension made
prior to the receipt by Bank of any such item shall not constitute a waiver by Bank of Borrower’s obligation to deliver such item, and the making of any Credit Extension in the absence of a required item shall be in Bank’s sole discretion.

 3.4 Procedures for Borrowing. 
 Subject to the prior satisfaction of all other applicable conditions to the making of an Advance set forth in this Agreement, to obtain an Advance (other than Advances under Sections 2.1.2 or 2.1.4
), Borrower shall notify Bank (which notice shall be irrevocable) by electronic mail, facsimile, or telephone by 12:00 p.m. Pacific time on the Funding Date of the Advance. Together with such notification, Borrower must promptly deliver to Bank by
electronic mail or facsimile a completed Transaction Report executed by a Responsible Officer or his or her designee. Bank shall credit Advances to the Designated Deposit Account. Bank may make Advances under this Agreement based on instructions
from a Responsible Officer or his or her designee or without instructions if the Advances are necessary to meet Obligations which have become due. Bank may rely on any telephone notice given by a person whom Bank believes is a Responsible Officer or
designee. 
 4 CREATION OF SECURITY INTEREST 
 4.1 Grant of Security Interest. 
 Borrower hereby grants Bank, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Bank, the Collateral, wherever located, whether now
owned or hereafter acquired or arising, and all proceeds and products thereof. 
  

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 4.2 Priority of Security Interest. Borrower represents, warrants, and covenants that
the security interest granted herein is and shall at all times continue to be a first priority perfected security interest in the Collateral (subject only to Permitted Liens that may have superior priority to Bank’s Lien under this Agreement).
If Borrower shall acquire a commercial tort claim, Borrower shall promptly notify Bank in a writing signed by Borrower of the general details thereof and grant to Bank in such writing a security interest therein and in the proceeds thereof, all upon
the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to Bank. 
 If this Agreement
is terminated, Bank’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations) are repaid in full in cash. Upon payment in full in cash of the Obligations and at such time as Bank’s obligation
to make Credit Extensions has terminated, Bank shall, at Borrower’s sole cost and expense, release its Liens in the Collateral and all rights therein shall revert to Borrower. 
 4.3 Authorization to File Financing Statements. Borrower hereby authorizes Bank to file financing statements, without notice to
Borrower, with all appropriate jurisdictions to perfect or protect Bank’s interest or rights hereunder, including a notice that any disposition of the Collateral, by either Borrower or any other Person, shall be deemed to violate the rights of
Bank under the Code. 
 5 REPRESENTATIONS AND WARRANTIES 
 Borrower represents and warrants as follows: 
 5.1 Due Organization, Authorization; Power and Authority. 
 Borrower is duly
existing and in good standing as a Registered Organization in its jurisdiction of formation and is qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of its business or its ownership of property
requires that it be qualified except where the failure to do so could not reasonably be expected to have a material adverse effect on Borrower’s business. In connection with this Agreement, Borrower has delivered to Bank a completed certificate
signed by Borrower, entitled “Perfection Certificate”. Borrower represents and warrants to Bank that (a) Borrower’s exact legal name is that indicated on the Perfection Certificate and on the signature page hereof;
(b) Borrower is an organization of the type and is organized in the jurisdiction set forth in the Perfection Certificate; (c) the Perfection Certificate accurately sets forth Borrower’s organizational identification number or
accurately states that Borrower has none; (d) the Perfection Certificate accurately sets forth Borrower’s place of business, or, if more than one, its chief executive office as well as Borrower’s mailing address (if different than its
chief executive office); (e) Borrower (and each of its predecessors) has not, in the past five (5) years, changed its jurisdiction of formation, organizational structure or type, or any organizational number assigned by its jurisdiction;
and (f) all other information set forth on the Perfection Certificate pertaining to Borrower and each of its Subsidiaries is accurate and complete (it being understood and agreed that Borrower may from

  

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time to time update certain information in the Perfection Certificate after the Effective Date to the extent permitted by one or more specific provisions in this Agreement). If Borrower is not
now a Registered Organization but later becomes one, Borrower shall promptly notify Bank of such occurrence and provide Bank with Borrower’s organizational identification number. 
 The execution, delivery and performance by Borrower of the Loan Documents to which it is a party have been duly authorized, and do not
(i) conflict with any of Borrower’s organizational documents, (ii) contravene, conflict with, constitute a default under or violate any material Requirement of Law, (iii) contravene, conflict or violate any applicable order,
writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or any of its Subsidiaries or any of their property or assets may be bound or affected, (iv) require any action by, filing, registration,
or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full force and effect) or (v) constitute an event of default under any material
agreement by which Borrower is bound. Borrower is not in default under any agreement to which it is a party or by which it is bound in which the default could reasonably be expected to have a material adverse effect on Borrower’s business.

 5.2 Collateral. 
 Borrower has good title to, has rights in, and the power to transfer each item of the Collateral upon which it purports to grant a Lien hereunder, free and clear of any and all Liens except Permitted
Liens. Borrower has no deposit accounts other than the deposit accounts with Bank, the deposit accounts, if any, described in the Perfection Certificate delivered to Bank in connection herewith, or of which Borrower has given Bank notice and taken
such actions as are necessary to give Bank a perfected security interest therein. The Accounts are bona fide, existing obligations of the Account Debtors. 
 The Collateral is not in the possession of any third party bailee (such as a warehouse) except as otherwise provided in the Perfection Certificate. None of the components of the Collateral shall be
maintained at locations other than as provided in the Perfection Certificate or as permitted pursuant to Section 7.2. 
 All
Inventory is in all material respects of good and marketable quality, free from material defects. 
 Borrower is the sole owner
of the Intellectual Property which it owns or purports to own except for (a) non-exclusive licenses granted to its customers in the ordinary course of business, (b) over-the-counter software that is commercially available to the public or
standard tool, library, software stack and core licenses used by Borrower in the ordinary course of designing and operating semiconductor chips, and (c) material Intellectual Property licensed to Borrower and noted on the Perfection
Certificate. Each Patent which it owns or purports to own and which is material to Borrower’s business is valid and enforceable, and no part of the Intellectual Property which Borrower owns or purports to own and which is material to
Borrower’s business has been judged invalid or unenforceable, in whole or in part. To the best of Borrower’s knowledge, no legal proceeding has been initiated based on a claim that any part of the Intellectual Property violates the rights
of any third party except to the extent such claim would not reasonably be expected to have a material adverse effect on Borrower’s business. Except as noted on the Perfection Certificate, Borrower is not a party to, nor is it bound by,
any Restricted License. 
  

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 5.3 Accounts Receivable. 
 (a) For each Account with respect to which Formula Advances are requested, on the date each Formula Advance is requested and made, such
Account shall be an Eligible Account. 
 (b) All statements made and all unpaid balances appearing in all invoices, instruments
and other documents evidencing the Eligible 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. All sales and other transactions underlying or
giving rise to each Eligible 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 in any Transaction Report. To the best of Borrower’s knowledge, all signatures and endorsements on all documents, instruments, and agreements relating to all Eligible Accounts are genuine, and all such documents,
instruments and agreements are legally enforceable in accordance with their terms. 
 5.4 Litigation. 

There are no actions or proceedings pending or, to the knowledge of the Responsible Officers, threatened in writing by or against Borrower
or any of its Subsidiaries involving more than Fifty Thousand Dollars ($50,000), individually or in the aggregate. 
 5.5
Financial Statements; Financial Condition. 
 All consolidated financial statements for Borrower and any of its
Subsidiaries delivered to Bank fairly present in all material respects Borrower’s consolidated financial condition and Borrower’s consolidated results of operations. There has not been any material deterioration in Borrower’s
consolidated financial condition since the date of the most recent financial statements submitted to Bank. 
 5.6
Solvency. 
 The fair salable value of Borrower’s assets (including goodwill minus disposition costs) exceeds the
fair value of its liabilities; Borrower is not left with unreasonably small capital after the transactions in this Agreement; and Borrower is able to pay its debts (including trade debts) as they mature. 
  

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 5.7 Regulatory Compliance. 
 Borrower is not an “investment company” or a company “controlled” by an “investment company” under the
Investment Company Act of 1940, as amended. Borrower is not engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors). Borrower has complied in all
material respects with the Federal Fair Labor Standards Act. Neither Borrower nor any of its Subsidiaries is a “holding company” or an “affiliate” of a “holding company” or a “subsidiary company” of a
“holding company” as each term is defined and used in the Public Utility Holding Company Act of 2005. Borrower has not violated any laws, ordinances or rules, the violation of which could reasonably be expected to have a material adverse
effect on its business. None of Borrower’s or any of its Subsidiaries’ properties or assets has been used by Borrower or any Subsidiary or, to the best of Borrower’s knowledge, by previous Persons, in disposing, producing, storing,
treating, or transporting any hazardous substance other than legally. Borrower and each of its Subsidiaries have obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all Government
Authorities that are necessary to continue their respective businesses as currently conducted. 
 5.8 Subsidiaries;
Investments. 
 Borrower does not own any stock, partnership interest or other equity securities except for Permitted
Investments. 
 5.9 Tax Returns and Payments; Pension Contributions. 
 Borrower 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. Borrower may defer payment of any contested taxes, provided that Borrower (a) in good faith contests its obligation to pay the taxes by appropriate proceedings promptly and diligently
instituted and conducted, (b) notifies Bank in writing of the commencement of, and any material development in, the proceedings, (c) posts bonds or takes any other steps required to prevent the governmental authority levying such contested
taxes from obtaining a Lien upon any of the Collateral that is other than a “Permitted Lien”. Borrower is unaware of any claims or adjustments proposed for any of Borrower’s prior tax years which could result in additional taxes
becoming due and payable by Borrower. Borrower has paid all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms, and Borrower has not withdrawn from participation in, and has
not permitted partial or complete termination of, or permitted the occurrence of any other event with respect to, any such plan which could reasonably be expected to result in any liability of Borrower, including any liability to the Pension Benefit
Guaranty Corporation or its successors or any other governmental agency. 
 5.10 Use of Proceeds. 
 Borrower shall use the proceeds of the Credit Extensions solely as working capital and to fund its general business requirements and not for
personal, family, household or agricultural purposes. 
  

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 5.11 Full Disclosure. 
 No written representation, warranty or other statement of Borrower in any certificate or written statement given to Bank, as of the date such
representation, warranty, or other statement was made, taken together with all such written certificates and written statements given to Bank, contains any untrue statement of a material fact or omits to state a material fact necessary to make the
statements contained in the certificates or statements not misleading (it being recognized by Bank that the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that actual
results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results). 
 5.12 Definition of “Knowledge.” 
 For purposes of the Loan Documents, whenever a representation or
warranty is made to Borrower’s knowledge or awareness, to the “best of” Borrower’s knowledge, or with a similar qualification, knowledge or awareness means the actual knowledge, after reasonable investigation, of the Responsible
Officers. 
 6 AFFIRMATIVE COVENANTS 
 Borrower shall do all of the following: 
 6.1 Government Compliance.

 (a) Maintain its and all its Subsidiaries’ legal existence and good standing in their respective jurisdictions of
formation and maintain qualification in each jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on Borrower’s business or operations. Borrower shall comply, and have each Subsidiary
comply, with all laws, ordinances and regulations to which it is subject, noncompliance with which could have a material adverse effect on Borrower’s business. 
 (b) Obtain all of the Governmental Approvals necessary for the performance by Borrower of its obligations under the Loan Documents to which it is a party and the grant of a security interest to Bank in
all of its property. Borrower shall promptly provide copies of any such obtained Governmental Approvals to Bank. 
 6.2
Financial Statements, Reports, Certificates. 
 Provide Bank with the following: 
 (a) a Transaction Report (and any schedules related thereto), (i) monthly, during any Streamline Period, and (ii) weekly, at all
other times; provided, however that Borrower shall not be required to deliver any Transaction Reports to Bank at any time when no Obligations (including undrawn Letters of Credit) are outstanding; 
 (b) within twenty (20) days after the end of each month, (A) monthly accounts receivable agings, aged by invoice date,
(B) monthly accounts payable agings, aged by invoice date, and outstanding or held check registers, if any, and (C) monthly reconciliations of accounts receivable agings (aged by invoice date), transaction reports and general ledger;

  

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 (c) as soon as available, but no later than thirty (30) days after the last day of each
month, a company prepared consolidated balance sheet and income statement covering Borrower’s consolidated operations for such month certified by a Responsible Officer and in a form acceptable to Bank (the “Monthly Financial
Statements”); 
 (d) within thirty (30) days after the last day of each month and together with the Monthly
Financial Statements, a duly completed Compliance Certificate signed by a Responsible Officer, certifying that as of the end of such month, Borrower was in full compliance with all of the terms and conditions of this Agreement, and setting forth
calculations showing compliance with the financial covenants set forth in this Agreement and such other information as Bank shall reasonably request, including, without limitation, a statement that at the end of such month there were no held checks;

 (e) within thirty (30) days after the end of each fiscal year of Borrower, annual financial projections for the
following fiscal year (on a quarterly basis) as approved by Borrower’s board of directors, together with any related business forecasts used in the preparation of such annual financial projections; 
 (f) as soon as available, and in any event within one hundred eighty (180) days following the end of Borrower’s fiscal year,
audited consolidated financial statements prepared under GAAP, consistently applied, together with an unqualified opinion on the financial statements from an independent certified public accounting firm acceptable to Bank in its reasonable
discretion; 
 (g) in the event that Borrower becomes subject to the reporting requirements under the Exchange Act within five
(5) days of filing, copies of all periodic and other reports, proxy statements and other materials filed by Borrower with the SEC, any Governmental Authority succeeding to any or all of the functions of the SEC or with any national securities
exchange, or distributed to its shareholders, as the case may be. Documents required to be delivered pursuant to the terms hereof (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered
electronically and if so delivered, shall be deemed to have been delivered on the date on which Borrower posts such documents, or provides a link thereto, on Borrower’s website on the Internet at Borrower’s website address; 
 (h) within five (5) days of delivery, copies of all statements, reports and notices made available to Borrower’s security holders
or to any holders of Subordinated Debt; 
 (i) prompt written notice of Borrower’s knowledge of an event that could
reasonably be expected to materially and adversely affect the value of the Intellectual Property; 
 (j) prompt report of any
legal actions pending or threatened in writing against Borrower or any of its Subsidiaries that could result in damages or costs to Borrower or any of its Subsidiaries of, individually or in the aggregate, One Hundred Thousand Dollars ($100,000) or
more; and 
  

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 (k) other financial information reasonably requested by Bank. 
 6.3 Accounts Receivable. 
 (a) Schedules and Documents Relating to Accounts. 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 requested by Bank, Borrower shall furnish Bank with copies (or, at Bank’s 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, Borrower shall deliver to Bank, on its 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 indorsements, and copies of all credit memos. 
 (b) Disputes. 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 Event of Default has occurred and is continuing; and (iii) after taking into account all such discounts, settlements and
forgiveness, the total outstanding Formula Advances will not exceed the lesser of the Revolving Line or the Borrowing Base. 
 (c) Collection of Accounts. During any Streamline Period, Borrower shall have the right to collect all Accounts, unless and until an Event of Default has occurred and is continuing. At all other times, Bank shall require that all
proceeds of Accounts be deposited by Borrower into a lockbox account, or such other “blocked account” as specified by Bank, pursuant to a blocked account agreement in such form as Bank may specify in its good faith business judgment.
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 immediately deliver all such payments and proceeds to Bank in their original
form, duly endorsed, to be applied (i) prior to an Event of Default, pursuant to the terms of Section 2.5(b) hereof, and (ii) after the occurrence and during the continuance of an Event of Default, pursuant to the terms of Section 9.4
hereof. 
 (d) Returns. Provided no Event of Default has occurred and is continuing, if any Account Debtor returns
any Inventory to Borrower, (i) Borrower shall promptly process such returns through Borrower’s Return Material Authorization Process (as such process has been described to Bank) in accordance with the terms provided to Bank on or before
the Effective Date (the “RMA Process”), and (ii) to the extent that Borrower elects not to process any Inventory through the RMA Process or the RMA Process results in a finding that a return is for any reason other than user
error, Borrower shall promptly (A) determine the reason for such return, (B) for amounts in excess of Fifty Thousand Dollars ($50,000), issue a credit memorandum to the Account Debtor in the appropriate amount, and (C) provide a copy
of such

  

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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. Bank may, from time to time, verify directly with the respective Account Debtors 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. 
 6.4 Remittance of
Proceeds. 
 Except as otherwise provided in Section 6.3(c), deliver, in kind, all proceeds arising from the
disposition of any Collateral to Bank in the original form in which received by Borrower not later than the following Business Day after receipt by Borrower, to be applied to the Obligations (a) prior to an Event of Default, pursuant to the
terms of Section 2.5(b) hereof, and (b) after the occurrence and during the continuance of an Event of Default, pursuant to the terms of Section 9.4 hereof; provided that, if no Event of Default has occurred and is continuing, Borrower shall
not be obligated to remit to Bank the proceeds of the sale of worn out or obsolete Equipment disposed of by Borrower in good faith in an arm’s length transaction for an aggregate purchase price of $25,000 or less (for all such transactions in
any fiscal year). Borrower agrees that it will not commingle proceeds of Collateral with any of Borrower’s other funds or property, but will hold such proceeds separate and apart from such other funds and property and in an express trust for
Bank. Nothing in this Section limits the restrictions on disposition of Collateral set forth elsewhere in this Agreement. 
 6.5 Taxes; Pensions. 
 Timely file, and require each of its Subsidiaries to timely file, all required tax
returns and reports and timely pay, and require each of its Subsidiaries to timely pay, all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower and each of its Subsidiaries, except for deferred payment
of any taxes contested pursuant to the terms of Section 5.9 hereof, and shall deliver to Bank, on demand, appropriate certificates attesting to such payments, and pay all amounts necessary to fund all present pension, profit sharing and deferred
compensation plans in accordance with their terms. 
 6.6 Access to Collateral; Books and Records. 
 At reasonable times, on one (1) Business Days’ notice (provided no notice is required if an Event of Default has occurred and is
continuing), Bank, or its agents, shall have the right to inspect the Collateral and the right to audit and copy Borrower’s Books. The foregoing

  

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inspections and audits shall be at Borrower’s expense, and the charge therefor shall be $850 per person per day (or such higher amount as shall represent Bank’s then-current standard
charge for the same), plus reasonable out-of-pocket expenses. In the event Borrower and Bank schedule an audit more than ten (10) days in advance, and Borrower cancels or seeks to reschedules the audit with less than three (3) days written
notice to Bank, then (without limiting any of Bank’s rights or remedies), Borrower shall pay Bank a fee of up to $1,000 plus any out-of-pocket expenses incurred by Bank to compensate Bank for the anticipated costs and expenses of the
cancellation or rescheduling. 
 6.7 Insurance. 
 Keep its business and the Collateral insured for risks and in amounts standard for companies in Borrower’s industry and location and as
Bank may reasonably request. Insurance policies shall be in a form, with companies, and in amounts that are satisfactory to Bank in its reasonable discretion. All property policies shall have a lender’s loss payable endorsement showing Bank as
the sole lender loss payee and waive subrogation against Bank. All liability policies shall show, or have endorsements showing, Bank as an additional insured. All policies (or the loss payable and additional insured endorsements) shall provide that
the insurer shall give Bank at least twenty (20) days (or 10 days with respect to cancellation due to nonpayment of premiums) notice before canceling, amending, or declining to renew its policy. At Bank’s request, Borrower shall deliver
certified copies of policies and evidence of all premium payments. Proceeds payable under any property policy shall, at Bank’s option, be payable to Bank on account of the Obligations. If Borrower fails to obtain insurance as required under
this Section 6.7 or to pay any amount or furnish any required proof of payment to third persons and Bank, Bank may make all or part of such payment or obtain such insurance policies required in this Section 6.7, and take any action under the
policies Bank deems prudent. 
 6.8 Operating Accounts. 
 (a) Maintain with Bank and Bank’s Affiliates (i) its primary operating and other deposit accounts and (ii) at least fifty
percent (50%) of the dollar value of Borrower’s investment accounts. 
 (b) Provide Bank five (5) days prior
written notice before establishing any Collateral Account at or with any bank or financial institution other than Bank or Bank’s Affiliates. For each Collateral Account that Borrower at any time maintains, Borrower shall cause the applicable
bank or financial institution (other than Bank) at or with which any Collateral Account is maintained to execute and deliver a Control Agreement or other appropriate instrument with respect to such Collateral Account to perfect Bank’s Lien in
such Collateral Account in accordance with the terms hereunder which Control Agreement may not be terminated without the prior written consent of Bank. The provisions of the previous sentence shall not apply to deposit accounts exclusively used for
payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of Borrower’s employees and identified to Bank by Borrower as such. 
  

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 6.9 Financial Covenants. 
 Maintain at all times, to be tested as of the last day of each month, unless otherwise noted, on a consolidated basis with respect to
Borrower and its Subsidiaries: 
 (a) Tangible Net Worth. A Tangible Net Worth of at least Twenty Million Dollars
($20,000,000), plus the sum of (i) fifty percent (50%) of quarterly Net Income (without reduction for any losses), plus (ii) fifty percent (50%) of issuances of equity after the Effective Date, plus (iii) fifty percent
(50%) of the principal amount of the proceeds received by Borrower after the Effective Date in connection with Subordinated Debt, on a cumulative basis. The minimum required Tangible Net Worth shall be adjusted quarterly with respect to
increases in connection with Net Income and monthly with respect to increases in connection with equity issuances and Subordinated Debt proceeds. 
 6.10 Protection of Intellectual Property Rights. 
 (a)(i) Protect, defend and maintain the validity and enforceability of its material Intellectual Property; (ii) promptly advise Bank in writing of material infringements of its material Intellectual Property; and (iii) not
allow any Intellectual Property material to Borrower’s business to be abandoned, forfeited or dedicated to the public without Bank’s written consent. 
 (b) Provide written notice to Bank within ten (10) days of entering or becoming bound by any Restricted License (other than over-the-counter software that is commercially available to the public or
standard tool, library, software stack and core licenses used by Borrower in the ordinary course of designing and operating semiconductor chips). Borrower shall take such steps as Bank requests to obtain the consent of, or waiver by, any person
whose consent or waiver is necessary for (i) any Restricted License to be deemed “Collateral” and for Bank to have a security interest in it that might otherwise be restricted or prohibited by law or by the terms of any such
Restricted License, whether now existing or entered into in the future, and (ii) Bank to have the ability in the event of a liquidation of any Collateral to dispose of such Collateral in accordance with Bank’s rights and remedies under
this Agreement and the other Loan Documents. 
 6.11 Litigation Cooperation. 
 From the date hereof and continuing through the termination of this Agreement, make available to Bank, without expense to Bank, Borrower and
its officers, employees and agents and Borrower’s books and records, to the extent that Bank may deem them reasonably necessary to prosecute or defend any third-party suit or proceeding instituted by or against Bank with respect to any
Collateral or relating to Borrower. 
 6.12 Further Assurances. 
 Execute any further instruments and take further action as Bank reasonably requests to perfect or continue Bank’s Lien in the Collateral
or to effect the purposes of this Agreement. Deliver to Bank, within five (5) Business Days after the same are sent or received, copies of all correspondence, reports, documents and other filings with any Governmental Authority regarding
compliance with or maintenance of Governmental Approvals or Requirements of Law or that could reasonably be expected to have a material effect on any of the Governmental Approvals or otherwise on the operations of Borrower or any of its
Subsidiaries. 
  

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 7 NEGATIVE COVENANTS 
 Borrower shall not do any of the following without Bank’s prior written consent: 
 7.1 Dispositions. 
 Convey, sell, lease, transfer, assign, or otherwise dispose of (collectively, “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property,
except for Transfers (a) of Inventory in the ordinary course of business; (b) of worn-out or obsolete Equipment; and (c) in connection with Permitted Liens and Permitted Investments. 
 7.2 Changes in Business, Management, Ownership, or Business Locations. 
 (a) Engage in or permit any of its Subsidiaries to engage in any business other than the businesses currently engaged in by Borrower and such
Subsidiary, as applicable, or reasonably related thereto; (b) liquidate or dissolve; or (c) (i) have a change in management; or (ii) enter into any transaction or series of related transactions in which the stockholders of
Borrower who were not stockholders immediately prior to the first such transaction own more than forty percent (40%) of the voting stock of Borrower immediately after giving effect to such transaction or related series of such transactions
(other than by the sale of Borrower’s equity securities in a public offering or to venture capital investors so long as Borrower identifies to Bank the venture capital investors prior to the closing of the transaction and provides to Bank a
description of the material terms of the transaction). 
 Borrower shall not, without at least thirty (30) days prior
written notice to Bank: (1) add any new offices or business locations in the United States, including warehouses (unless such new offices or business locations contain less than One Hundred Thousand Dollars ($100,000) in Borrower’s assets
or property) or deliver any portion of the Collateral valued, individually or in the aggregate, in excess of One Hundred Thousand Dollars ($100,000) to a bailee at a location in the United States other than to a bailee and at a location already
disclosed in the Perfection Certificate, (2) change its jurisdiction of organization, (3) change its organizational structure or type, (4) change its legal name, or (5) change any organizational number (if any) assigned by its
jurisdiction of organization. If Borrower intends to deliver any portion of the Collateral valued, individually or in the aggregate, in excess of One Hundred Thousand Dollars ($100,000) to a bailee in the United States, and Bank and such bailee are
not already parties to a bailee agreement governing both the Collateral and the location to which Borrower intends to deliver the Collateral, then Borrower will first receive the written consent of Bank, and such bailee shall execute and deliver a
bailee agreement in form and substance satisfactory to Bank in its sole discretion. 
 7.3 Mergers or
Acquisitions. 
 Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any other
Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of another Person. A Subsidiary may merge or consolidate into another Subsidiary or into Borrower. 
  

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 7.4 Indebtedness. 
 Create, incur, assume, or be liable for any Indebtedness, or permit any Subsidiary to do so, other than Permitted Indebtedness. 

7.5 Encumbrance. 
 Create, incur, allow, or suffer any Lien on any of its property, or assign or convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, except for
Permitted Liens, permit any Collateral not to be subject to the first priority security interest granted herein, or enter into any agreement, document, instrument or other arrangement (except with or in favor of Bank) with any Person which directly
or indirectly prohibits or has the effect of prohibiting Borrower or any Subsidiary from assigning, mortgaging, pledging, granting a security interest in or upon, or encumbering any of Borrower’s or any Subsidiary’s Intellectual Property,
except as is otherwise permitted in Section 7.1 hereof and the definition of “Permitted Liens” herein. 
 7.6
Maintenance of Collateral Accounts. 
 Maintain any Collateral Account except pursuant to the terms of Section 6.8(b)
hereof. 
 7.7 Distributions; Investments. 
 (a) Pay any dividends or make any distribution or payment or redeem, retire or purchase any capital stock; or (b) directly or
indirectly make any Investment other than Permitted Investments, or permit any of its Subsidiaries to do so. 
 7.8
Transactions with Affiliates. 
 Directly or indirectly enter into or permit to exist any material transaction with
any Affiliate of Borrower, except for transactions that are in the ordinary course of Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm’s length transaction with a
non-affiliated Person. 
 7.9 Subordinated Debt. 
 (a) Make or permit any payment on any Subordinated Debt, except under the terms of the subordination, intercreditor, or other similar
agreement to which such Subordinated Debt is subject, or (b) amend any provision in any document relating to the Subordinated Debt which would increase the amount thereof or adversely affect the subordination thereof to Obligations owed to
Bank. 
  

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 7.10 Compliance. 
 Become an “investment company” or a company controlled by an “investment company”, under the Investment Company Act of
1940, as amended, or undertake as one of its important activities extending credit to purchase or carry margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System), or use the proceeds of any Credit Extension
for that purpose; fail to meet the minimum funding requirements of ERISA, permit a Reportable Event or Prohibited Transaction, as defined in ERISA, to occur; fail to comply with the Federal Fair Labor Standards Act or violate any other law or
regulation, if the violation could reasonably be expected to have a material adverse effect on Borrower’s business, or permit any of its Subsidiaries to do so; withdraw or permit any Subsidiary to withdraw from participation in, permit partial
or complete termination of, or permit the occurrence of any other event with respect to, any present pension, profit sharing and deferred compensation plan which could reasonably be expected to result in any liability of Borrower, including any
liability to the Pension Benefit Guaranty Corporation or its successors or any other governmental agency. 
 8
EVENTS OF DEFAULT 
 Any one of the following shall constitute an event of default (an “Event of
Default”) under this Agreement: 
 8.1 Payment Default. 
 Borrower fails to (a) make any payment of principal or interest on any Credit Extension on its due date, or (b) pay any other
Obligations within three (3) Business Days after such Obligations are due and payable (which three (3) Business Day cure period shall not apply to payments due on the Revolving Line Maturity Date). During the cure period, the failure to
make or pay any payment specified under clause (a) or (b) hereunder is not an Event of Default (but no Credit Extension will be made during the cure period); 
 8.2 Covenant Default. 
 (a) Borrower fails or neglects to perform any
obligation in Sections 6.2, 6.5, 6.7, 6.8, 6.9, or violates any covenant in Section 7; or 
 (b) Borrower fails or neglects to
perform, keep, or observe any other term, provision, condition, covenant or agreement contained in this Agreement or any Loan Documents, and as to any default (other than those specified in this Section 8) under such other term, provision,
condition, covenant or agreement that can be cured, has failed to cure the default within ten (10) days after the occurrence thereof; provided, however, that if the default cannot by its nature be cured within the ten (10) day period or
cannot after diligent attempts by Borrower be cured within such ten (10) day period, and such default is likely to be cured within a reasonable time, then Borrower shall have an additional period (which shall not in any case exceed thirty
(30) days) to attempt to cure such default, and within such reasonable time period the failure to cure the default shall not be deemed an Event of Default (but no Credit Extensions shall be made during such cure period). Cure periods provided
under this section shall not apply, among other things, to financial covenants or any other covenants set forth in clause (a) above; 
  

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 8.3 Material Adverse Change. 
 A Material Adverse Change occurs; 
 8.4 Attachment; Levy; Restraint on Business. 
 (a)(i) The service of process
seeking to attach, by trustee or similar process, any funds of Borrower or of any entity under the control of Borrower (including a Subsidiary) on deposit or otherwise maintained with Bank or any Bank Affiliate, or (ii) a notice of lien or levy
is filed against any of Borrower’s assets by any government agency, and the same under subclauses (i) and (ii) hereof are not, within ten (10) days after the occurrence thereof, discharged or stayed (whether through the posting
of a bond or otherwise); provided, however, no Credit Extensions shall be made during any ten (10) day cure period; or 
 (b)(i) any material portion of Borrower’s assets is attached, seized, levied on, or comes into possession of a trustee or receiver, or (ii) any court order enjoins, restrains, or prevents Borrower from conducting any material part
of its business; 
 8.5 Insolvency. 
 (a) Borrower is unable to pay its debts (including trade debts) as they become due or otherwise becomes insolvent; (b) Borrower begins an Insolvency Proceeding; or (c) an Insolvency Proceeding
is begun against Borrower and not dismissed or stayed within thirty (30) days (but no Credit Extensions shall be made while of any of the conditions described in clause (a) exist and/or until any Insolvency Proceeding is dismissed);

 8.6 Other Agreements. 
 There is, under any agreement to which Borrower is a party with a third party or parties, (a) any default resulting in a right by such third party or parties, whether or not exercised, to accelerate
the maturity of any Indebtedness in an amount individually or in the aggregate in excess of One Hundred Thousand Dollars ($100,000); or (b) any default by Borrower, the result of which could have a material adverse effect on Borrower’s
business; 
 8.7 Judgments. 
 One or more final judgments, orders, or decrees for the payment of money in an amount, individually or in the aggregate, of at least One Hundred Thousand Dollars ($100,000) (not covered by independent
third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against Borrower and the same are not, within ten (10) days after the entry thereof, discharged or execution thereof stayed or bonded
pending appeal, or such judgments are not discharged prior to the expiration of any such stay (provided that no Credit Extensions will be made prior to the discharge, stay, or bonding of such judgment, order, or decree); 
  

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 8.8 Misrepresentations. 
 Borrower or any Person acting for Borrower makes any representation, warranty, or other statement now or later in this Agreement, any Loan
Document or in any writing delivered to Bank or to induce Bank to enter this Agreement or any Loan Document, and such representation, warranty, or other statement is incorrect in any material respect when made; 
 8.9 Subordinated Debt. 
 Any document, instrument, or agreement evidencing any Subordinated Debt shall for any reason be revoked or invalidated or otherwise cease to be in full force and effect, any Person shall be in breach
thereof or contest in any manner the validity or enforceability thereof or deny that it has any further liability or obligation thereunder, or the Obligations shall for any reason be subordinated or shall not have the priority contemplated by this
Agreement; or 
 8.10 Governmental Approvals. 
 Any Governmental Approval shall have been (a) revoked, rescinded, suspended, modified in an adverse manner or not renewed in the
ordinary course for a full term or (b) subject to any decision by a Governmental Authority that designates a hearing with respect to any applications for renewal of any of such Governmental Approval or that could result in the Governmental
Authority taking any of the actions described in clause (a) above, and such decision or such revocation, rescission, suspension, modification or non-renewal (i) has, or could reasonably be expected to have, a Material Adverse Change, or
(ii) adversely affects the legal qualifications of Borrower or any of its Subsidiaries to hold such Governmental Approval in any applicable jurisdiction and such revocation, rescission, suspension, modification or non-renewal could reasonably
be expected to affect the status of or legal qualifications of Borrower or any of its Subsidiaries to hold any Governmental Approval in any other jurisdiction. 
 9 BANK’S RIGHTS AND REMEDIES 
 9.1 Rights and Remedies. 

 While an Event of Default occurs and continues Bank may, without notice or demand, do any or all of the following: 

(a) declare all Obligations immediately due and payable (but if an Event of Default described in Section 8.5 occurs all Obligations are
immediately due and payable without any action by Bank); 
 (b) stop advancing money or extending credit for Borrower’s
benefit under this Agreement or under any other agreement between Borrower and Bank; 
 (c) demand that Borrower
(i) deposit cash with Bank in an amount equal to 105% of the Dollar Equivalent of the aggregate face amount of all Letters of Credit remaining undrawn (plus all interest, fees, and costs due or to become due in connection therewith (as
estimated by Bank in its good faith business judgment)), to secure all of the Obligations relating to such Letters of Credit, as collateral security for the repayment of any future drawings under such Letters of Credit, and Borrower shall forthwith
deposit and pay such amounts, and (ii) pay in advance all letter of credit fees scheduled to be paid or payable over the remaining term of any Letters of Credit; 
  

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 (d) terminate any FX Forward Contracts; 
 (e) settle or adjust disputes and claims directly with Account Debtors for amounts on terms and in any order that Bank considers advisable,
notify any Person owing Borrower money of Bank’s security interest in such funds, and verify the amount of such account; 
 (f) make any payments and do any acts it considers necessary or reasonable to protect the Collateral and/or its security interest in the Collateral. Borrower shall assemble the Collateral if Bank requests and make it available as Bank
designates. Bank may enter premises where the Collateral is located, take and maintain possession of any part of the Collateral, and pay, purchase, contest, or compromise any Lien which appears to be prior or superior to its security interest and
pay all expenses incurred. Borrower grants Bank a license to enter and occupy any of its premises, without charge, to exercise any of Bank’s rights or remedies; 
 (g) apply to the Obligations any (i) balances and deposits of Borrower it holds, or (ii) any amount held by Bank owing to or for the credit or the account of Borrower; 
 (h) ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell the Collateral. Bank is hereby
granted a non-exclusive, royalty-free license or other right to use, without charge, Borrower’s labels, Patents, Copyrights, mask works, rights of use of any name, trade secrets, trade names, Trademarks, and advertising matter, or any similar
property as it pertains to the Collateral, in completing production of, advertising for sale, and selling any Collateral and, in connection with Bank’s exercise of its rights under this Section, Borrower’s rights under all licenses and all
franchise agreements inure to Bank’s benefit; 
 (i) place a “hold” on any account maintained with Bank and/or
deliver a notice of exclusive control, any entitlement order, or other directions or instructions pursuant to any Control Agreement or similar agreements providing control of any Collateral; 
 (j) demand and receive possession of Borrower’s Books; and 
 (k) exercise all rights and remedies available to Bank under the Loan Documents or at law or equity, including all remedies provided under
the Code (including disposal of the Collateral pursuant to the terms thereof). 
 9.2 Power of Attorney. 
 Borrower hereby irrevocably appoints Bank as its lawful attorney-in-fact, exercisable upon the occurrence and during the continuance of an
Event of Default, to: (a) endorse Borrower’s name on any checks or other forms of payment or security; (b) sign Borrower’s name on any invoice or bill of lading for any Account or drafts against Account Debtors; (c) settle
and adjust disputes and claims about the Accounts directly with Account Debtors, for amounts and

  

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on terms Bank determines reasonable; (d) make, settle, and adjust all claims under Borrower’s insurance policies; (e) pay, contest or settle any Lien, charge, encumbrance, security
interest, and adverse claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; and (f) transfer the Collateral into the name of Bank or a third party as the Code permits.
Borrower hereby appoints Bank as its lawful attorney-in-fact to sign Borrower’s name on any documents necessary to perfect or continue the perfection of Bank’s security interest in the Collateral regardless of whether an Event of Default
has occurred until all Obligations have been satisfied in full and Bank is under no further obligation to make Credit Extensions hereunder. Bank’s foregoing appointment as Borrower’s attorney in fact, and all of Bank’s rights and
powers, coupled with an interest, are irrevocable until all Obligations have been fully repaid and performed and Bank’s obligation to provide Credit Extensions terminates. 
 9.3 Protective Payments. 
 If Borrower fails to obtain the insurance called for by Section 6.7 or fails to pay any premium thereon or fails to pay any other amount which Borrower is obligated to pay under this Agreement or any
other Loan Document, Bank may obtain such insurance or make such payment, and all amounts so paid by Bank are Bank Expenses and immediately due and payable, bearing interest at the then highest rate applicable to the Obligations, and secured by the
Collateral. Bank will make reasonable efforts to provide Borrower with notice of Bank obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Bank are deemed an agreement to make similar payments in
the future or Bank’s waiver of any Event of Default. 
 9.4 Application of Payments and Proceeds. 
 If an Event of Default has occurred and is continuing, Bank may apply any funds in its possession, whether from Borrower account balances,
payments, proceeds realized as the result of any collection of Accounts or other disposition of the Collateral, or otherwise, to the Obligations in such order as Bank shall determine in its sole discretion. Any surplus shall be paid to Borrower by
credit to the Designated Deposit Account or to other Persons legally entitled thereto; Borrower shall remain liable to Bank for any deficiency. If Bank, in its good faith business judgment, directly or indirectly enters into a deferred payment or
other credit transaction with any purchaser at any sale of Collateral, Bank shall have the option, exercisable at any time, of either reducing the Obligations by the principal amount of the purchase price or deferring the reduction of the
Obligations until the actual receipt by Bank of cash therefor. 
 9.5 Bank’s Liability for Collateral. 

So long as Bank complies with reasonable banking industry practices regarding the safekeeping of the Collateral in the possession or under
the control of Bank, Bank shall not be liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage to the Collateral; (c) any diminution in the value of the Collateral; or (d) any act or default of
any carrier, warehouseman, bailee, or other Person. Borrower bears all risk of loss, damage or destruction of the Collateral. 
  

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 9.6 No Waiver; Remedies Cumulative. 
 Bank’s failure, at any time or times, to require strict performance by Borrower of any provision of this Agreement or any other Loan
Document shall not waive, affect, or diminish any right of Bank thereafter to demand strict performance and compliance herewith or therewith. No waiver hereunder shall be effective unless signed by the party granting the waiver and then is only
effective for the specific instance and purpose for which it is given. Bank’s rights and remedies under this Agreement and the other Loan Documents are cumulative. Bank has all rights and remedies provided under the Code, by law, or in equity.
Bank’s exercise of one right or remedy is not an election and shall not preclude Bank from exercising any other remedy under this Agreement or other remedy available at law or in equity, and Bank’s waiver of any Event of Default is not a
continuing waiver. Bank’s delay in exercising any remedy is not a waiver, election, or acquiescence. 
 9.7 Demand
Waiver. 
 Borrower waives demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default,
nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by Bank on which Borrower is liable. 
 10 NOTICES 
 All notices, consents, requests, approvals, demands, or other communication by any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or delivered: (a) upon the
earlier of actual receipt and three (3) Business Days after deposit in the U.S. mail, first class, registered or certified mail return receipt requested, with proper postage prepaid; (b) upon transmission, when sent by electronic mail or
facsimile transmission; (c) one (1) Business Day after deposit with a reputable overnight courier with all charges prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed to the party to be
notified and sent to the address, facsimile number, or email address indicated below. Bank or Borrower may change its mailing or electronic mail address or facsimile number by giving the other party written notice thereof in accordance with the
terms of this Section 10. 
  

			
	 If to Borrower:
	  	Beceem Communications Inc.
		  	3960 Freedom Circle, First Floor
		  	Santa Clara, California 95054
		  	Attn:
                                         
                          
		  	Fax:
                                         
                          
		  	Email:
		
	 If to Bank:
	  	Silicon Valley Bank
		  	3979 Freedom Circle, Suite 600
		  	Santa Clara, California 95054
		  	Attn: Minal Patel
		  	Fax: (408) 654-5517
		  	Email: mpatel@svb.com

  

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 11 CHOICE OF LAW, VENUE, JURY TRIAL WAIVER AND JUDICIAL REFERENCE 

California law governs the Loan Documents without regard to principles of conflicts of law. Borrower and Bank each submit to the exclusive
jurisdiction of the State and Federal courts in Santa Clara County, California; provided, however, that nothing in this Agreement shall be deemed to operate to preclude Bank from bringing suit or taking other legal action in any other jurisdiction
to realize on the Collateral or any other security for the Obligations, or to enforce a judgment or other court order in favor of Bank. Borrower expressly submits and consents in advance to such jurisdiction in any action or suit commenced in any
such court, and Borrower hereby waives any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consents to the granting of such legal or equitable relief as is deemed appropriate by
such court. Borrower hereby waives personal service of the summons, complaints, and other process issued in such action or suit and agrees that service of such summons, complaints, and other process may be made by registered or certified mail
addressed to Borrower at the address set forth in, or subsequently provided by Borrower in accordance with, Section 10 of this Agreement and that service so made shall be deemed completed upon the earlier to occur of Borrower’s actual receipt
thereof or three (3) days after deposit in the U.S. mails, proper postage prepaid. 
 TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, BORROWER AND BANK EACH WAIVE THEIR RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND
ALL OTHER CLAIMS. THIS WAIVER IS A MATERIAL INDUCEMENT FOR BOTH PARTIES TO ENTER INTO THIS AGREEMENT. EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL. 
 WITHOUT INTENDING IN ANY WAY TO LIMIT THE PARTIES’ AGREEMENT TO WAIVE THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY, if the above waiver of the right to a trial by jury is not enforceable, the parties
hereto agree that any and all disputes or controversies of any nature between them arising at any time shall be decided by a reference to a private judge, mutually selected by the parties (or, if they cannot agree, by the Presiding Judge of the
Santa Clara County, California Superior Court) appointed in accordance with California Code of Civil Procedure Section 638 (or pursuant to comparable provisions of federal law if the dispute falls within the exclusive jurisdiction of the
federal courts), sitting without a jury, in Santa Clara County, California; and the parties hereby submit to the jurisdiction of such court. The reference proceedings shall be conducted pursuant to and in accordance with the provisions of California
Code of Civil Procedure §§ 638 through 645.1, inclusive. The private judge shall have the power, among others, to grant provisional relief, including without limitation, entering temporary restraining orders, issuing preliminary and
permanent injunctions and appointing receivers. All such proceedings shall be closed to the public and confidential and all records relating thereto shall be permanently sealed. If during the course of any dispute, a party desires to seek
provisional relief, but a judge has not been appointed at that point pursuant to the judicial reference procedures, then such party may apply to the Santa Clara County, California Superior Court for such relief. The proceeding before the private
judge shall be conducted in the same

  

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manner as it would be before a court under the rules of evidence applicable to judicial proceedings. The parties shall be entitled to discovery which shall be conducted in the same manner as it
would be before a court under the rules of discovery applicable to judicial proceedings. The private judge shall oversee discovery and may enforce all discovery rules and orders applicable to judicial proceedings in the same manner as a trial court
judge. The parties agree that the selected or appointed private judge shall have the power to decide all issues in the action or proceeding, whether of fact or of law, and shall report a statement of decision thereon pursuant to California Code of
Civil Procedure § 644(a). Nothing in this paragraph shall limit the right of any party at any time to exercise self-help remedies, foreclose against collateral, or obtain provisional remedies. The private judge shall also determine all issues
relating to the applicability, interpretation, and enforceability of this paragraph. 
 12 GENERAL PROVISIONS 

 12.1 Termination Prior to Revolving Line Maturity Date. 
 This Agreement may be terminated prior to the Revolving Line Maturity Date by Borrower, effective three (3) Business Days after written
notice of termination is given to Bank. Notwithstanding any such termination, Bank’s lien and security interest in the Collateral shall continue until Borrower fully satisfies its Obligations. 
 12.2 Successors and Assigns. 
 This Agreement binds and is for the benefit of the successors and permitted assigns of each party. Borrower may not assign this Agreement or any rights or obligations under it without Bank’s prior
written consent (which may be granted or withheld in Bank’s discretion). Bank has the right, without the consent of or notice to Borrower, to sell, transfer, assign, negotiate, or grant participation in all or any part of, or any interest in,
Bank’s obligations, rights, and benefits under this Agreement and the other Loan Documents. 
 12.3 Indemnification.

 Borrower agrees to indemnify, defend and hold Bank and its directors, officers, employees, agents, attorneys, or any other
Person affiliated with or representing Bank (each, an “Indemnified Person”) harmless against: (a) all obligations, demands, claims, and liabilities (collectively, “Claims”) claimed or asserted by any other
party in connection with the transactions contemplated by the Loan Documents; and (b) all losses or expenses (including Bank Expenses) in any way suffered, incurred, or paid by such Indemnified Person as a result of, following from,
consequential to, or arising from transactions between Bank and Borrower (including reasonable attorneys’ fees and expenses), except for Claims and/or losses directly caused by such Indemnified Person’s gross negligence or willful
misconduct. 
 12.4 Time of Essence. 
 Time is of the essence for the performance of all Obligations in this Agreement. 
  

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 12.5 Severability of Provisions. 
 Each provision of this Agreement is severable from every other provision in determining the enforceability of any provision. 
 12.6 Correction of Loan Documents. 
 Bank may correct patent errors and fill in any blanks in the Loan Documents consistent with the agreement of the parties. 
 12.7 Amendments in Writing; Waiver; Integration. 
 No purported amendment or
modification of any Loan Document, or waiver, discharge or termination of any obligation under any Loan Document, shall be enforceable or admissible unless, and only to the extent, expressly set forth in a writing signed by the party against which
enforcement or admission is sought. Without limiting the generality of the foregoing, no oral promise or statement, nor any action, inaction, delay, failure to require performance or course of conduct shall operate as, or evidence, an amendment,
supplement or waiver or have any other effect on any Loan Document. Any waiver granted shall be limited to the specific circumstance expressly described in it, and shall not apply to any subsequent or other circumstance, whether similar or
dissimilar, or give rise to, or evidence, any obligation or commitment to grant any further waiver. 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 the Loan Documents merge into the Loan Documents. 
 12.8 Counterparts. 
 This Agreement may be executed in any number of
counterparts and by different parties on separate counterparts, each of which, when executed and delivered, is an original, and all taken together, constitute one Agreement. 
 12.9 Survival. 
 All covenants, representations and warranties made in this Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations (other than inchoate indemnity obligations and any other obligations
which, by their terms, are to survive the termination of this Agreement) have been satisfied. The obligation of Borrower in Section 12.3 to indemnify Bank shall survive until the statute of limitations with respect to such claim or cause of
action shall have run. 
 12.10 Confidentiality. 
 In handling any confidential information, Bank shall exercise the same degree of care that it exercises for its own proprietary information,
but disclosure of information may be made: (a) to Bank’s Subsidiaries or Affiliates; (b) to prospective transferees or purchasers of any interest in the Credit Extensions (provided, however, Bank shall use its best efforts to obtain
any prospective transferee’s or purchaser’s agreement to the terms of this provision); (c) as required

  

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by law, regulation, subpoena, or other order; provided that, to the extent permitted by law, notice of such disclosure is given to Borrower on a best efforts basis, (d) to Bank’s
regulators or as otherwise required in connection with Bank’s examination or audit; (e) as Bank considers appropriate in exercising remedies under the Loan Documents; and (f) to third-party service providers of Bank so long as such service
providers have executed a confidentiality agreement with Bank with terms no less restrictive than those contained herein. Confidential information does not include information that is either: (i) in the public domain or in Bank’s
possession when disclosed to Bank, or becomes part of the public domain after disclosure to Bank; or (ii) disclosed to Bank by a third party, if Bank does not know that the third party is prohibited from disclosing the information. 

Bank may use confidential information for the development of databases, reporting purposes, and market analysis so long as such
confidential information is aggregated and anonymized prior to distribution unless otherwise expressly permitted by Borrower. The provisions of the immediately preceding sentence shall survive the termination of this Agreement. 

12.11 Attorneys’ Fees, Costs and Expenses. 
 In any action or proceeding between Borrower and Bank arising out of or relating to the Loan Documents, the prevailing party shall be entitled to recover its reasonable attorneys’ fees and other
costs and expenses incurred, in addition to any other relief to which it may be entitled. 
 12.12 Electronic Execution of
Documents. 
 The words “execution,” “signed,” “signature” and words of like import in any Loan
Document shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity and enforceability as a manually executed signature or the use of a paper-based
recordkeeping systems, as the case may be, to the extent and as provided for in any applicable law, including, without limitation, any state law based on the Uniform Electronic Transactions Act. 
 12.13 Captions. 
 The headings used in this Agreement are for convenience only and shall not affect the interpretation of this Agreement. 
 12.14 Construction of Agreement. 
 The parties mutually acknowledge that they and their attorneys have
participated in the preparation and negotiation of this Agreement. In cases of uncertainty this Agreement shall be construed without regard to which of the parties caused the uncertainty to exist. 
 12.15 Relationship. 
 The relationship of the parties to this Agreement is determined solely by the provisions of this Agreement. The parties do not intend to create any agency, partnership, joint venture, trust, fiduciary or other relationship with duties or
incidents different from those of parties to an arm’s-length contract. 
  

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 12.16 Third Parties. 
 Nothing in this Agreement, whether express or implied, is intended to: (a) confer any benefits, rights or remedies under or by reason of
this Agreement on any persons other than the express parties to it and their respective permitted successors and assigns; (b) relieve or discharge the obligation or liability of any person not an express party to this Agreement; or
(c) give any person not an express party to this Agreement any right of subrogation or action against any party to this Agreement. 
 13 DEFINITIONS 
 13.1 Definitions. 
 As used in the Loan Documents, the word “shall” is mandatory, the word “may” is permissive, the word “or” is
not exclusive, the words “includes” and “including” are not limiting, the singular includes the plural, and numbers denoting amounts that are set off in brackets are negative. As used in this Agreement, the following capitalized
terms have the following meanings: 
 “Account” is any “account” as defined in the Code with such
additions to such term as may hereafter be made, and includes, without limitation, all accounts receivable and other sums owing to Borrower. 
 “Account Debtor” is any “account debtor” as defined in the Code with such additions to such term as may hereafter be made. 
 “Adjusted Quick Ratio” means, with respect to Borrower and its Subsidiaries as of any testing date, a ratio of
(a) Quick Assets to (b) Current Liabilities minus Deferred Revenue. 
 “Advance” or
“Advances” means a Formula Advance or a Non-Formula Advance. 
 “Affiliate” is, with respect
to any Person, each other Person that owns or controls directly or indirectly the Person, any Person that controls or is controlled by or is under common control with the Person, and each of that Person’s senior executive officers, directors,
partners and, for any Person that is a limited liability company, that Person’s managers and members. 
 “Agreement” is defined in the preamble hereof. 
 “Applicable Margin” means the
following amounts, based on the Adjusted Quick Ratio of Borrower as reported to Bank: 
  

				
	 Adjusted Quick Ratio
	  	Applicable Margin:	 
	 Greater than or equal to 1.50 to 1.00
	  	None	  
	 At all other times
	  	0.25	% 

  

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 In the event that Borrower fails to deliver to Bank the financial statements needed to set
the Applicable Margin when due, the Applicable Margin shall be 0.25% until the first day of the first month after Bank receives and reviews such financial statements. 
 “Availability Amount” is (a) the lesser of (i) the Revolving Line or (ii) the amount available under the Borrowing Base, minus (b) the Dollar Equivalent amount of all
outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit), minus (c) the FX Reduction Amount, minus (d) any amounts used for Cash Management Services, and minus (e) the outstanding principal balance of any
Advances. 
 “Bank” is defined in the preamble hereof. 
 “Bank Expenses” are all audit fees and expenses, costs, and expenses (including reasonable attorneys’ fees and
expenses) for preparing, amending, negotiating, administering, defending and enforcing the Loan Documents (including, without limitation, those incurred in connection with appeals or Insolvency Proceedings) or otherwise incurred with respect to
Borrower. 
 “Borrower” is defined in the preamble hereof 
 “Borrower’s Books” are all Borrower’s books and records including ledgers, federal and state tax returns, records
regarding Borrower’s assets or liabilities, the Collateral, business operations or financial condition, and all computer programs or storage or any equipment containing such information. 
 “Borrowing Base” is eighty percent (80%) of Eligible Accounts, as determined by Bank from Borrower’s most recent
Transaction Report; provided, however, that Bank may decrease the foregoing percentage in its good faith business judgment based on events, conditions, contingencies, or risks which, as determined by Bank, may adversely affect Collateral.

 “Borrowing Resolutions” are, with respect to any Person, those resolutions substantially in the form
attached hereto as Exhibit D. 
 “Business Day” is any day that is not a Saturday, Sunday or a
day on which Bank is closed. 
 “Cash Equivalents” means (a) marketable direct obligations issued or
unconditionally guaranteed by the United States or any agency or any State thereof having maturities of not more than one (1) year from the date of acquisition; (b) commercial paper maturing no more than one (1) year after its
creation and having the highest rating from either Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc.; (c) Bank’s certificates of deposit issued maturing no more than one (1) year after issue.

 “Cash Management Services” is defined in Section 2.1.4. 
  

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 “Code” is the Uniform Commercial Code, as the same may, from time to time,
be enacted and in effect in the State of California; provided, that, to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently in different Articles or Divisions of the Code, the
definition of such term contained in Article or Division 9 shall govern; provided further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, or priority of, or remedies with respect to,
Bank’s Lien on any Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than the State of California, the term “Code” shall mean the Uniform Commercial Code as enacted and in effect in such
other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority, or remedies and for purposes of definitions relating to such provisions. 
 “Collateral” is any and all properties, rights and assets of Borrower described on Exhibit A. 
 “Collateral Account” is any Deposit Account, Securities Account, or Commodity Account. 
 “Commodity Account” is any “commodity account” as defined in the Code with such additions to such term as may
hereafter be made. 
 “Compliance Certificate” is that certain certificate in the form attached hereto as
Exhibit B. 
 “Contingent Obligation” is, for any Person, any direct or indirect liability,
contingent or not, of that Person for (a) any indebtedness, lease, dividend, letter of credit or other obligation of another such as an obligation, in each case, directly or indirectly guaranteed, endorsed, co-made, discounted or sold with
recourse by that Person, or for which that Person is directly or indirectly liable; (b) any obligations for undrawn letters of credit for the account of that Person; and (c) all obligations from any interest rate, currency or commodity
swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; but “Contingent Obligation” does
not include endorsements in the ordinary course of business. The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum
reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement. 
 “Control Agreement” is any control agreement entered into among the depository institution at which Borrower maintains a
Deposit Account or the securities intermediary or commodity intermediary at which Borrower maintains a Securities Account or a Commodity Account, Borrower, and Bank pursuant to which Bank obtains control (within the meaning of the Code) over such
Deposit Account, Securities Account, or Commodity Account. 
 “Copyrights” are any and all copyright rights,
copyright applications, copyright registrations and like protections in each work or authorship and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret. 
  

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 “Credit Extension” is any Formula Advance, Non Formula Advance, Letter of
Credit, FX Forward Contract, amount utilized for Cash Management Services, or any other extension of credit by Bank for Borrower’s benefit. 
 “Current Liabilities” are all obligations and liabilities of Borrower to Bank, plus, without duplication, the aggregate amount of Borrower’s Total Liabilities that mature within one
(1) year. 
 “Default Rate” is defined in Section 2.3(b). 
 “Deferred Revenue” is all amounts received or invoiced in advance of performance under contracts and not yet
recognized as revenue. 
 “Deposit Account” is any “deposit account” as defined in the Code
with such additions to such term as may hereafter be made. 
 “Designated Deposit Account” is Borrower’s
deposit account, account number                             , maintained with Bank. 
 “Dollars,” “dollars” or use of the sign “$” means only lawful money
of the United States and not any other currency, regardless of whether that currency uses the “$” sign to denote its currency or may be readily converted into lawful money of the United States. 
 “Dollar Equivalent” is, at any time, (a) with respect to any amount denominated in Dollars, such amount, and
(b) with respect to any amount denominated in a Foreign Currency, the equivalent amount therefor in Dollars as determined by Bank at such time on the basis of the then-prevailing rate of exchange in San Francisco, California, for sales of the
Foreign Currency for transfer to the country issuing such Foreign Currency. 
 “Effective Date” is
defined in the preamble hereof. 
 “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 (other than Accounts owing from Account Debtors listed on Schedule A attached
hereto) unless such Accounts are otherwise Eligible Accounts and (i) supported by letter(s) of credit acceptable to Bank, or (ii) that Bank otherwise approves of in writing; 
  

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 (d) Accounts billed and/or payable outside of the United States; 
 (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, except for Accounts owing from Motorola, for which such percentage is (i) one hundred percent (100%) through March 31, 2010 and (ii) fifty percent (50%) thereafter, 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); 
 (l) 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

  

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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); 
 (p) Accounts
owing from an Account Debtor with respect to which Borrower has received Deferred Revenue (but only to the extent of such Deferred Revenue); 
 (q) Accounts for which the Account Debtor has not been invoiced; 
 (r) Accounts
that represent non-trade receivables or that are derived by means other than in the ordinary course of Borrower’s business; 
 (s) Accounts for which Borrower has permitted Account Debtor’s payment to extend beyond 90 days; 
 (t) 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); 
 (u) 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 
 (v) Accounts for
which Bank in its good faith business judgment determines collection to be doubtful. 
 “Equipment” is all
“equipment” as defined in the Code with such additions to such term as may hereafter be made, and includes without limitation all machinery, fixtures, goods, vehicles (including motor vehicles and trailers), and any interest in any of the
foregoing. 
 “ERISA” is the Employee Retirement Income Security Act of 1974, and its regulations. 

“Event of Default” is defined in Section 8. 
 “Exchange Act” is the Securities Exchange Act of 1934, as amended. 
 “Foreign Currency” means lawful money of a country other than the United States. 
 “Formula Advance” is defined in Section 2.1.1(a). 
 “Funding Date” is any date on which a Credit Extension is made to or for the account of Borrower which shall be a
Business Day. 
 “FX Business Day” is any day when (a) Bank’s Foreign Exchange
Department is conducting its normal business and (b) the Foreign Currency being purchased or sold by Borrower is available to Bank from the entity from which Bank shall buy or sell such Foreign Currency. 
 “FX Forward Contract” is defined in Section 2.1.3. 
  

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 “FX Reduction Amount” is defined in Section 2.1.3. 
 “FX Reserve” is defined in Section 2.1.3. 
 “GAAP” is generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other Person as may be approved by a significant segment of
the accounting profession, which are applicable to the circumstances as of the date of determination. 
 “General
Intangibles” is all “general intangibles” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation, all Intellectual Property, claims, income
and other tax refunds, security and other deposits, payment intangibles, contract rights, options to purchase or sell real or personal property, rights in all litigation presently or hereafter pending (whether in contract, tort or otherwise),
insurance policies (including without limitation key man, property damage, and business interruption insurance), payments of insurance and rights to payment of any kind. 
 “Governmental Approval” is any consent, authorization, approval, order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to,
or other act by or in respect of, any Governmental Authority. 
 “Governmental Authority” is any nation or
government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of
or pertaining to government, any securities exchange and any self-regulatory organization. 
 “Indebtedness” is
(a) indebtedness for borrowed money or the deferred price of property or services, such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar
instruments, (c) capital lease obligations, and (d) Contingent Obligations. 
 “Indemnified Person”
is defined in Section 12.3. 
 “Initial Audit” is Bank’s inspection of Borrower’s Accounts, the
Collateral, and Borrower’s Books. 
 “Insolvency Proceeding” is any proceeding by or against any Person
under the United States Bankruptcy Code, or any other bankruptcy or insolvency law, including assignments for the benefit of creditors, compositions, extensions generally with its creditors, or proceedings seeking reorganization, arrangement, or
other relief. 
 “Intellectual Property” means all of Borrower’s right, title, and interest in and to the
following: 
 (a) its Copyrights, Trademarks and Patents; 
  

 -36- 








 (b) any and all trade secrets and trade secret rights, including, without limitation, any
rights to unpatented inventions, know-how, operating manuals; 
 (c) any and all source code; 
 (d) any and all design rights which may be available to a Borrower; 
 (e) any and all claims for damages by way of past, present and future infringement of any of the foregoing, with the right, but not the
obligation, to sue for and collect such damages for said use or infringement of the Intellectual Property rights identified above; and 
 (f) all amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents. 
 “Inventory” is all “inventory” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation all merchandise, raw materials, parts,
supplies, packing and shipping materials, work in process and finished products, including without limitation such inventory as is temporarily out of Borrower’s custody or possession or in transit and including any returned goods and any
documents of title representing any of the above. 
 “Investment” is any beneficial ownership interest in any
Person (including stock, partnership interest or other securities), and any loan, advance or capital contribution to any Person. 
 “Letter of Credit” means a standby letter of credit issued by Bank or another institution based upon an application, guarantee, indemnity or similar agreement on the part of Bank as set forth in Section 2.1.2. 

“Letter of Credit Application” is defined in Section 2.1.2(b). 
 “Lien” is a claim, mortgage, deed of trust, levy, charge, pledge, security interest or other encumbrance of any kind,
whether voluntarily incurred or arising by operation of law or otherwise against any property. 
 “Loan
Documents” are, collectively, this Agreement, the Perfection Certificate, any note, or notes or guaranties executed by Borrower or any other Person, and any other present or future agreement between Borrower or any such Person and/or for
the benefit of Bank in connection with this Agreement, all as amended, restated, or otherwise modified. 
 “Material
Adverse Change” is (a) a material impairment in the perfection or priority of Bank’s Lien in the Collateral or in the value of such Collateral; (b) a material adverse change in the business, operations, or condition
(financial or otherwise) of Borrower; (c) a material impairment of the prospect of repayment of any portion of the Obligations or (d) Bank determines, based upon information available to it and in its reasonable judgment, that there is a
reasonable likelihood that Borrower shall fail to comply with one or more of the financial covenants in Section 6 during the next succeeding financial reporting period. 
  


 -37- 








 “Monthly Financial Statements” is defined in Section 6.2(c). 
 “Net Income” means, as calculated on a consolidated basis for Borrower and its Subsidiaries for any period as at any date
of determination, the net profit (or loss), after provision for taxes, of Borrower and its Subsidiaries for such period taken as a single accounting period. 
 “Non Formula Advance” is defined in Section 2.1.5. 
 “Obligations” are Borrower’s obligations to pay when due any debts, principal, interest, Bank Expenses and other amounts Borrower owes Bank now or later, whether under this Agreement, the Loan Documents, or otherwise,
including, without limitation, all obligations relating to letters of credit (including reimbursement obligations for drawn and undrawn letters of credit), cash management services, and foreign exchange contracts, if any, and including interest
accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of Borrower assigned to Bank, and to perform Borrower’s duties under the Loan Documents. 
 “Operating Documents” are, for any Person, such Person’s formation documents, as certified with the Secretary of State
of such Person’s state of formation on a date that is no earlier than 30 days prior to the Effective Date, and, (a) if such Person is a corporation, its bylaws in current form, (b) if such Person is a limited liability company, its
limited liability company agreement (or similar agreement), and (c) if such Person is a partnership, its partnership agreement (or similar agreement), each of the foregoing with all current amendments or modifications thereto. 
 “Overadvance” is defined in Section 2.2. 
 “Patents” means all patents, patent applications and like protections including without limitation improvements, divisions, continuations, renewals, reissues, extensions and
continuations-in-part of the same. 
 “Payment” means all checks, wire transfers and other items of payment
received by Bank (including proceeds of Accounts and payment of the Obligations in full) for credit to Borrower’s outstanding Credit Extensions or, if the balance of the Credit Extensions has been reduced to zero, for credit to its deposit
accounts. 
 “Perfection Certificate” is defined in Section 5.1. 
 “Permitted Indebtedness” is: 
 (a) Borrower’s Indebtedness to Bank under this Agreement and the other Loan Documents; 
 (b) Indebtedness existing on the Effective Date and shown on the Perfection Certificate; 
 (c) Subordinated Debt; 
  

 -38- 








 (d) unsecured Indebtedness to trade creditors incurred in the ordinary course of business;

 (e) Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business;

 (f) Indebtedness secured by Liens permitted under clauses (a) and (c) of the definition of “Permitted
Liens” hereunder; and 
 (g) extensions, refinancings, modifications, amendments and restatements of any items of Permitted
Indebtedness (a) through (f) above, provided that the principal amount thereof is not increased or the terms thereof are not modified to impose more burdensome terms upon Borrower or its Subsidiary, as the case may be. 
 “Permitted Investments” are: 
 (a) Investments (including, without limitation, Subsidiaries) existing on the Effective Date and shown on the Perfection Certificate; 
 (b) Investments consisting of Cash Equivalents; 
 (c) Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of Borrower; 
 (d) Investments consisting of deposit accounts in which Bank has a perfected security interest; 
 (e) Investments accepted in connection with Transfers permitted by Section 7.1; 
 (f) Investments (i) by Borrower in Subsidiaries not to exceed Fifty Thousand Dollars ($50,000) in the aggregate in any fiscal year and
(ii) by Subsidiaries in other Subsidiaries not to exceed Fifty Thousand Dollars ($50,000) in the aggregate in any fiscal year or in Borrower; 
 (g) Investments consisting of (i) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business, and (ii) loans to employees, officers or
directors relating to the purchase of equity securities of Borrower or its Subsidiaries pursuant to employee stock purchase plans or agreements approved by Borrower’s Board of Directors; 
 (h) Investments (including debt obligations) received in connection with the bankruptcy or reorganization of customers or suppliers and in
settlement of delinquent obligations of, and other disputes with, customers or suppliers arising in the ordinary course of business; and 
 (i) Investments consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers and suppliers who are not Affiliates, in the ordinary course of business; provided that
this paragraph (i) shall not apply to Investments of Borrower in any Subsidiary. 
  

 -39- 








 “Permitted Liens” are: 
 (a) Liens existing on the Effective Date and shown on the Perfection Certificate or arising under this Agreement and the other Loan
Documents; 
 (b) Liens for taxes, fees, assessments or other government charges or levies, either (i) not due and payable
or (ii) being contested in good faith and for which Borrower maintains adequate reserves on its Books, provided that no notice of any such Lien has been filed or recorded under the Internal Revenue Code of 1986, as amended, and the
Treasury Regulations adopted thereunder; 
 (c) purchase money Liens (i) on Equipment acquired or held by Borrower incurred
for financing the acquisition of the Equipment securing no more than Fifty Thousand Dollars ($50,000) in the aggregate amount outstanding, or (ii) existing on Equipment when acquired, if the Lien is confined to the property and
improvements and the proceeds of the Equipment; 
 (d) Liens of carriers, warehousemen, suppliers, or other Persons that are
possessory in nature arising in the ordinary course of business so long as such Liens attach only to Inventory, securing liabilities in the aggregate amount not to exceed Fifty Thousand Dollars ($50,000) and which are not delinquent or remain
payable without penalty or which are being contested in good faith and by appropriate proceedings which proceedings have the effect of preventing the forfeiture or sale of the property subject thereto; 
 (e) Liens to secure payment of workers’ compensation, employment insurance, old-age pensions, social security and other like
obligations incurred in the ordinary course of business (other than Liens imposed by ERISA); 
 (f) Liens incurred in the
extension, renewal or refinancing of the indebtedness secured by Liens described in (a) through (c), but any extension, renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the principal amount
of the indebtedness may not increase; 
 (g) leases or subleases of real property granted in the ordinary course of
Borrower’s business (or, if referring to another Person, in the ordinary course of such Person’s business), and leases, subleases, non-exclusive licenses or sublicenses of personal property (other than Intellectual Property) granted in the
ordinary course of Borrower’s business (or, if referring to another Person, in the ordinary course of such Person’s business), if the leases, subleases, licenses and sublicenses do not prohibit granting Bank a security interest
therein; 
 (h) non-exclusive license of Intellectual Property granted to third parties in the ordinary course of business;

 (i) Liens arising from attachments or judgments, orders, or decrees in circumstances not constituting an Event of Default
under Sections 8.4 and 8.7; and 
  

 -40- 








 (j) Liens in favor of other financial institutions arising in connection with
Borrower’s deposit and/or securities accounts held at such institutions, provided that Bank has a perfected security interest in the amounts held in such deposit and/or securities accounts. 
 “Person” is any individual, sole proprietorship, partnership, limited liability company, joint venture, company, trust,
unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or government agency. 
 “Prime Rate” is Bank’s most recently announced “prime rate,” even if it is not Bank’s lowest rate. 
 “Quick Assets” is, on any date, Borrower’s unrestricted cash and Cash Equivalents maintained with Bank, plus Eligible
Accounts. 
 “Registered Organization” is any “registered organization” as defined in the Code with
such additions to such term as may hereafter be made 
 “Requirement of Law” is as to any Person, the
organizational or governing documents of such Person, and any law (statutory or common), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is subject. 
 “Reserves” means, as of
any date of determination, such amounts as Bank may from time to time establish and revise in its good faith business judgment, reducing the amount of Advances and other financial accommodations which would otherwise be available to Borrower
(a) to reflect events, conditions, contingencies or risks which, as determined by Bank in its good faith business judgment, do or may adversely 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, business or prospects of Borrower, 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 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. 
 “Responsible Officer” is any of the Chief Executive Officer, President, Chief Financial Officer and Controller of Borrower.

 “Restricted License” is any material license or other agreement with respect to which Borrower is the
licensee (a) that prohibits or otherwise restricts Borrower from granting a security interest in Borrower’s interest in such license or agreement or any other property, or (b) for which a default under or termination of could
interfere with the Bank’s right to sell any Collateral. 
 “Revolving Line” is an Advance or
Advances in an amount equal to Seven Million Five Hundred Thousand Dollars ($7,500,000). 
  

 -41- 








 “Revolving Line Maturity Date” is December 1, 2010. 
 “SEC” shall mean the Securities and Exchange Commission, any successor thereto, and any analogous Governmental Authority.

 “Securities Account” is any “securities account” as defined in the Code with such additions to
such term as may hereafter be made. 
 “Settlement Date” is defined in Section 2.1.3. 
 “Streamline Period” is defined in Section 2.1.1(b). 
 “Subordinated Debt” is indebtedness incurred by Borrower subordinated to all of Borrower’s now or hereafter
indebtedness to Bank (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Bank entered into between Bank and the other creditor), on terms acceptable to Bank. 
 “Subsidiary” is, as to any Person, a corporation, partnership, limited liability company or other entity of which shares of
stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers
of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person. Unless the context otherwise requires,
each reference to a Subsidiary herein shall be a reference to a Subsidiary of Borrower. 
 “Tangible Net
Worth” is, on any date, the consolidated total assets of Borrower and its Subsidiaries minus (a) any amounts attributable to (i) goodwill, (ii) intangible items including unamortized debt discount and expense, Patents,
Trademarks, Copyrights, and research and development expenses except prepaid expenses, (iii) notes, accounts receivable and other obligations owing to Borrower from its officers or other Affiliates, and (iv) reserves not already deducted
from assets, minus (b) Total Liabilities , plus (c) Subordinated Debt. 
 “Total
Liabilities” is on any day, obligations that should, under GAAP, be classified as liabilities on Borrower’s consolidated balance sheet, including all Indebtedness, but excluding all other Subordinated Debt. 
 “Trademarks” means any trademark and servicemark rights, whether registered or not, applications to register and
registrations of the same and like protections, and the entire goodwill of the business of Borrower connected with and symbolized by such trademarks. 
 “Transaction Report” is that certain report of transactions and schedule of collections in the form attached hereto as Exhibit C. 
 “Transfer” is defined in Section 7.1. 
 [Signature page follows.] 
  

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 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as
of the Effective Date. 
 BORROWER: 
 BECEEM COMMUNICATIONS INC. 
  

			
	By	 	 /s/ Surendra Babu Mandava

	Name:	 	 Surendra Babu Mandava

	Title:	 	 CEO


 BANK: 
 SILICON VALLEY BANK 
  

			
	By	 	 /s/ Minal Patel

	Name:	 	 Minal Patel

	Title:	 	 Relationship Manager


 [Signature Page to Loan and Security Agreement] 







 EXHIBIT A – COLLATERAL DESCRIPTION 
 The Collateral consists of all of Borrower’s right, title and interest in and to the following personal property: 
 All goods, Accounts (including health-care receivables), Equipment, Inventory, contract rights or rights to payment of money, leases,
license agreements, franchise agreements, General Intangibles (except as provided below), commercial tort claims, documents, instruments (including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts,
fixtures, letters of credit rights (whether or not the letter of credit is evidenced by a writing), securities, and all other investment property, supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever
located; and 
 all Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the
above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing. 
 Notwithstanding the foregoing, the Collateral does not include any Intellectual Property; provided, however, the Collateral shall include
all Accounts and all proceeds of Intellectual Property. If a judicial authority (including a U.S. Bankruptcy Court) would hold that a security interest in the underlying Intellectual Property is necessary to have a security interest in such Accounts
and such property that are proceeds of Intellectual Property, then the Collateral shall automatically, and effective as of the Effective Date, include the Intellectual Property to the extent necessary to permit perfection of Bank’s security
interest in such Accounts and such other property of Borrower that are proceeds of the Intellectual Property. 
 Pursuant to the
terms of a certain negative pledge arrangement with Bank, Borrower has agreed not to encumber any of its Intellectual Property without Bank’s prior written consent. 







 EXHIBIT B 
 COMPLIANCE CERTIFICATE 
  

					
	TO:	  	SILICON VALLEY BANK	  	Date:
	FROM:	  	BECEEM COMMUNICATIONS INC.	  	

 The undersigned authorized officer of BECEEM COMMUNICATIONS INC. (“Borrower”) certifies
that under the terms and conditions of the Loan and Security Agreement between Borrower and Bank (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
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

	Transaction Reports	  	Weekly*	  	Yes   No
	Monthly financial statements with Compliance Certificate	  	Monthly within 30 days	  	Yes   No
	Annual financial statement (CPA Audited) + CC	  	FYE within 180 days	  	Yes   No
	10-Q, 10-K and 8-K	  	Within 5 days after filing with SEC	  	Yes   No
	A/R & A/P Agings and Deferred Revenue Report	  	Monthly within 20 days	  	Yes   No
	Annual Board Approved Financial Projections	  	FYE within 30 days	  	Yes   No

  

	*	Required monthly during any Streamline Period and not required at any time when no Obligations are outstanding 

  

										
	 Financial Covenant
	  	 Required
	 	 	 Actual
	  	 Complies

	 Maintain on a Monthly Basis:
	  				 			  	
	 Minimum Tangible Net Worth
	  	$	20,000,000	** 	 	$	        	  	Yes   No

  


	**	plus (i) 50% of quarterly Net Income after the Effective Date (without reduction for any losses), plus (ii) 50% of proceeds from the issuances of equity after
the Effective Date, plus (iii) 50% of Subordinated Debt proceeds received by Borrower after the Effective Date 









					
	 Performance Pricing*
	  	 Applies

	Adjusted Quick Ratio 3 1.50:1.00	  	Greater of Prime or 4%	  	Yes   No
	Adjusted Quick Ratio < 1.50:1.00	  	(a) Greater of Prime or 4% +(b) 0.25%	  	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.”) 
  
  
  
  
  
  
  
  
  
  
  
  
  



			
	BECEEM COMMUNICATIONS INC.
		
	By:	 	  

	Name:	 	
	Title:	 	

  




			
	BANK USE ONLY
		
	Received by:	 	  

		 	AUTHORIZED SIGNER


			
		
	Date:	 	  



			
		
	Verified:	 	  

		 	AUTHORIZED SIGNER


			
		
	Date:	 	  



			
		
	Compliance Status:	  	        Yes  No

  




  
  

 2 








 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.	Minimum Tangible Net Worth (Section 6.9(a)) 

  

	Required:	$20,000,000 plus (i) 50% of quarterly Net Income after the Effective Date (without reduction for any losses), plus (ii) 50% of proceeds from the issuances of
equity after the Effective Date, plus (iii) 50% of Subordinated Debt proceeds received by Borrower after the Effective Date 

 Actual: 
  

					
			
	A.	  	Aggregate value of total assets of Borrower and its Subsidiaries	  	$            
			
	B.	  	Aggregate value of goodwill of Borrower and its Subsidiaries	  	$            
			
	C.	  	Aggregate value of intangible assets of Borrower and its Subsidiaries	  	$            
			
	D.	  	Aggregate value of any reserves not already deducted from assets	  	$            
			
	E.	  	Aggregate value of liabilities that should, under GAAP, be classified as liabilities on Borrower’s consolidated balance sheet, including all Indebtedness	  	$            
			
	F.	  	Aggregate value of Indebtedness of Borrower subordinated to Borrower’s Indebtedness to Bank	  	$            
			
	G.	  	Tangible Net Worth (line A minus line B minus line C minus line D minus line E plus line F)	  	$            
			
	H.	  	50% of quarterly Net Income after the Effective Date (without reduction for any losses)	  	$            
			
	I.	  	50% of proceeds from the issuances of equity after the Effective Date	  	$            
			
	J.	  	50% of Subordinated Debt proceeds received by Borrower after the Effective Date	  	$            
			
	K.	  	Minimum Tangible Net Worth ($20,000,000) plus line H plus line I plus line J	  	$            

 Is line G equal to or greater than line K? 
  

			
	No, not in compliance	  	             Yes, in compliance

  

 3 








 EXHIBIT C 
 Transaction Report 







 Schedule A 
 Approved Foreign Account Debtors 
  

	
	Accton Technology Corporation
	Alcatel
	Alvarion Ltd.
	Asustek Computer Inc
	Azurewave Technologies Inc
	Gemtek Technology Co. Ltd.
	Foxconn (Hon Hai Precison Co. Ltd.)
	ICOMM Tele Ltd.
	Motorola Singapore
	Quanta Microsystems Inc.
	RTI Holdings Ltd.
	Sierra Wireless Inc
	Ubee Interactive Co. Ltd.
	Uniquest Corporation
	Zyxel Communications








 FIRST AMENDMENT TO 
 LOAN AND SECURITY AGREEMENT 
 THIS FIRST
AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is entered into this 30th day of March, 2010, by and between SILICON VALLEY BANK (“Bank”) and BECEEM COMMUNICATIONS INC., a Delaware corporation (“Borrower”).

 RECITALS 
 A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of December 2, 2009 (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) extend the Revolving Line
Maturity Date, (ii) modify the Tangible Net Worth covenant, 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 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 (Financial Covenants).
Section 6.9 of the Loan Agreement is amended by deleting clause (a) thereof in its entirety and replacing it with the following: 
 (a) Tangible Net Worth. A Tangible Net Worth of at least Twenty Million Dollars ($20,000,000), plus, commencing with the month ending September 30, 2010, the sum of (i) fifty percent
(50%) of quarterly Net Income (without reduction for any losses), plus (ii) fifty percent (50%) of issuances of equity after the Effective Date, plus (iii) fifty percent (50%) of the principal amount of the proceeds received
by Borrower after the Effective Date in connection with Subordinated Debt, on a cumulative basis. The minimum required Tangible Net Worth shall be adjusted quarterly with respect to increases in connection with Net Income and monthly with respect to
increases in connection with equity issuances and Subordinated Debt proceeds. 







 2.2 Section 13 (Definitions). The following term and its definition set
forth in Section 13.1 of the Loan Agreement is amended by deleting it in its entirety and replacing it with the following: 
 “Revolving Line Maturity Date” is July 1, 2011. 
 2.3 Compliance Certificate.
Exhibit B of the Loan Agreement is replaced in its entirety with Exhibit B attached hereto. From and after the date of this Amendment, all references in the Loan Agreement, to the Compliance Certificate shall be deemed to refer to
Exhibit B 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.

 3.3 In addition to those Events of Default specifically enumerated in the Loan Documents, the failure to comply with
the terms of any covenant or agreement contained herein shall constitute an Event of Default and shall entitle the Bank to exercise all rights and remedies provided to the Bank under the terms of any of the other Loan Documents as a result of the
occurrence of the same. 
 4. Representations and Warranties. To induce Bank to enter into this Amendment,
Borrower hereby represents and warrants to Bank as follows: 
 4.1 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; 
 4.2
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; 
 4.3 The organizational documents of Borrower delivered to Bank on the Effective Date remain true, accurate and complete and have not been amended, supplemented or restated and are and continue to
be in full force and effect; 
  

 2 








 4.4 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; 
 4.5 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; 
 4.6 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 Borrower, except as already has been obtained or made; and 
 4.7 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. 
 5. 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.

 6. Effectiveness. This Amendment shall be deemed effective upon (a) the due execution and delivery to Bank
of this Amendment by each party hereto, (b) Borrower’s payment of a non refundable amendment fee in an amount equal to Ten Thousand Dollars ($10,000), and (c) payment of Bank’s legal fees and expenses in connection with the
negotiation and preparation of this Amendment. 
 [Signature page follows.] 
  

 3 








 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/ Carley Brandt

	Name:	 	 Carley Brandt

	Title:	 	 Relationship Manager

	
	BORROWER
	
	BECEEM COMMUNICATIONS INC.
		
	By:	 	 /s/ Alan F. Krock

	Name:	 	 Alan F. Krock

	Title:	 	 VP, CFO


 [Signature Page to First Amendment to Loan and Security Agreement] 







 EXHIBIT B 
 COMPLIANCE CERTIFICATE 
  

					
	TO:	 	SILICON VALLEY BANK	  	Date:                    
	FROM:	 	BECEEM COMMUNICATIONS INC.	  	

 The undersigned authorized officer of BECEEM COMMUNICATIONS INC. (“Borrower”) certifies
that under the terms and conditions of the Loan and Security Agreement between Borrower and Bank (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
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
	Transaction Reports	  	Weekly*	  	Yes    No
	Monthly financial statements with Compliance Certificate	  	Monthly within 30 days	  	Yes    No
	Annual financial statement (CPA Audited) + CC	  	FYE within 180 days	  	Yes    No
	10-Q, 10-K and 8-K	  	Within 5 days after filing with SEC	  	Yes    No
	A/R & A/P Agings and Deferred Revenue Report	  	Monthly within 20 days	  	Yes    No
	Annual Board Approved Financial Projections	  	FYE within 30 days	  	Yes    No

  

	*	Required monthly during any Streamline Period and not required at any time when no Obligations are outstanding 

  

							
	 Financial Covenant
	  	Required	 	Actual	  	Complies
	Maintain on a Monthly Basis:	  		 		  	
	Minimum Tangible Net Worth	  	$20,000,000**	 	$        	  	Yes    No

  

	**	plus, commencing with the month ending September 30, 2010, (i) 50% of quarterly Net Income after the Effective Date (without reduction for any losses), plus
(ii) 50% of proceeds from the issuances of equity after the Effective Date, plus (iii) 50% of Subordinated Debt proceeds received by Borrower after the Effective Date 

  

 Exhibit B Page 1 









					
	 Performance Pricing*
	  	Applies
	Adjusted Quick Ratio 3 1.50:1.00	  	Greater of Prime or 4%	  	Yes    No
	Adjusted Quick Ratio < 1.50:1.00	  	(a) Greater of Prime or 4% +(b) 0.25%	  	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.”) 
  
  
  
  
  
  
  
  
  
                                        
                                         
                                         
                            
  

							
	        BECEEM COMMUNICATIONS INC.	 		 	BANK USE ONLY
				
		 		 		 	Received by:
                                         
                   
	        By:	 	  
	 		 	                                    AUTHORIZED
SIGNER
	        Name:	 		 		 	Date:
                                         
                                 
	        Title:	 		 		 	  
 Verified:
                                         
                           

		 		 		 	                                    AUTHORIZED
SIGNER
		 		 		 	Date:
                                         
                                 
		 		 		 	  
 Compliance
Status:            Yes    No


  

 Exhibit B Page 2 








 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.	Minimum Tangible Net Worth (Section 6.9(a)) 

  

			
	Required:	 	$20,000,000 plus, commencing with the month ending September 30, 2010, (i) 50% of quarterly Net Income after the Effective Date (without reduction for any losses), plus
(ii) 50% of proceeds from the issuances of equity after the Effective Date, plus (iii) 50% of Subordinated Debt proceeds received by Borrower after the Effective Date

 Actual: 
  

					
	 A.
	  	Aggregate value of total assets of Borrower and its Subsidiaries	  	$        
			
	 B.
	  	Aggregate value of goodwill of Borrower and its Subsidiaries	  	$        
			
	 C.
	  	Aggregate value of intangible assets of Borrower and its Subsidiaries	  	$        
			
	 D.
	  	Aggregate value of any reserves not already deducted from assets	  	$        
			
	 E.
	  	Aggregate value of liabilities that should, under GAAP, be classified as liabilities on Borrower’s consolidated balance sheet, including all Indebtedness	  	$        
			
	 F.
	  	Aggregate value of Indebtedness of Borrower subordinated to Borrower’s Indebtedness to Bank	  	$        
			
	 G.
	  	Tangible Net Worth (line A minus line B minus line C minus line D minus line E plus line F)	  	$        
			
	 H.
	  	50% of quarterly Net Income after the Effective Date (without reduction for any losses)	  	$        
			
	 I.
	  	50% of proceeds from the issuances of equity after the Effective Date	  	$        
			
	 J.
	  	50% of Subordinated Debt proceeds received by Borrower after the Effective Date	  	$        
			
	 K.
	  	Minimum Tangible Net Worth ($20,000,000) plus line H plus line I plus line J	  	$        

 Is line G equal to or greater than line K? 
  

			
	No, not in compliance	 	             Yes, in compliance

  

 Exhibit B Page 3