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    Exhibit
10.4

     

    
      	
              

            	
              SWAP TRANSACTION CONFIRMATION

            	 
      

      

    

     

    
      	
              Date:

            	
              January
      24, 2008

            
	
              To:

            	
              WACHOVIA
      AUTO LOAN OWNER TRUST 2008-1 ("Counterparty or Party
B")

            
	
              Address:

            	
              c/o
      Wilmington Trust Company, as Owner Trustee

              1100
      North Market Street

              Wilmington,
      Delaware 19890-1605

            
	
              Attention:

            	
              Corporate
      Trust Administration

            
	
              From:

            	
              Wachovia
      Bank, N.A. ("Wachovia or Party A")

            
	
              Ref.
      No.

            	
              2325847

            
	 
      	 
      

    

    

    
      	
              Dear
      Sir or Madam:

               

              This
      confirms the terms of the Transaction described below between Counterparty
      and Wachovia. The definitions and provisions contained in the 2006 ISDA
      Definitions, as published by the International Swaps and Derivatives
      Association, Inc., are incorporated into this Confirmation. In the event
      of any inconsistency between those definitions and provisions and this
      Confirmation, this Confirmation will
govern.

            

    

     

    1. The
terms of the particular Transaction to which the Confirmation relates are as
follows:

     

    
      	
              Transaction
      Type:

            	
              Interest
      Rate Swap

            
	
              Currency for
      Payments:

            	
              U.S.
      Dollars

            
	
              Notional
      Amount:

            	
              For
      each Calculation Period, the principal amount of the Class A-2b Notes
      issued by the Counterparty as of the preceding Distribution Date (as
      defined in the Indenture), after giving effect to all payments of
      principal on such Class A-2b Notes on or prior to that Distribution Date,
      or, in the case of the initial Calculation Period and the first
      Distribution Date, the original principal amount of the Class A-2b
      Notes.  For the avoidance of doubt, on the Effective Date, the
      Notional Amount is equal to $174,000,000.00.

            
	
              Term:

            	 
      
	
                     Trade
      Date:

            	
              January
      24, 2008

            
	
                     Effective
      Date:

            	
              January
      24, 2008

            
	
                     Termination
      Date:

            	
              In
      respect of the Fixed Amounts, the earlier of (i) March 20, 2011, subject
      to No Adjustment and (ii) the date on which the Note Balance (as defined
      in the Indenture) of the Class A-2b Notes is reduced to
zero..

              In
      respect of the Floating Amounts, the earlier of (i) March 20, 2011,
      subject to the Following Business Day Convention and (ii) the date on
      which the Note Balance  of the Class A-2b Notes is reduced to
      zero .

            

    

    

    
      	
              Fixed
      Amounts:

            	 
      
	 	 
	
                     Fixed
      Rate Payer:

            	
              Counterparty

            
	
                    
      Fixed Rate Payer 

                     Period
      End Dates:

            	
              Monthly
      on the 20th of each month, commencing March 20, 2008, through and
      including the Termination Date; No Adjustment.

            
	
                     Fixed
      Rate Payer

                     Payment
      Dates:

            	
              Monthly
      on the 20th
      of each month, commencing March 20, 2008, through and including the
      Termination Date.

            
	
                     Business
      Day Convention:

            	
              Following

            
	
                     Business
      Day:

            	
              New
      York

            
	
                     Fixed
      Rate:

            	
              4.15%

               

            

    

     

    
      
        
        

      

      
        Wachovia: 
2325847

        
          

        

      

      
        2 /
4

      

    

    

    
      	
                     Fixed
      Rate Day Count

                     Fraction:

            	
              30/360

            

    

    

    
      	
              Floating
      Amounts:

            	 
      
	 	 
	
                     Floating
      Rate Payer:

            	
              Wachovia

            
	
                     Floating
      Rate Payer

                     Period
      End Dates:

            	
              Monthly
      on the 20th of each month, commencing March 20, 2008, through and
      including the Termination Date, subject to adjustment in accordance with
      the Following Business Day Convention.

            
	
                     Floating
      Rate Payer

                     Payment
      Dates:

            	
              Monthly
      on the 1st Business Day preceding each Floating Rate Payer Period End
      Date, commencing March 19, 2008, through and including March 18, 2011.
      Notwithstanding the provisions of Section 4.9(a) of the 2006 ISDA
      Definitions, the Termination Date shall not be a Floating Rate Payer
      Payment Date hereunder. The final Floating Rate Payer Payment Date shall
      be March 18, 2011.

            
	
                     Business
      Day Convention:

            	
              Following

            
	
                     Business
      Day:

            	
              New
      York

            
	
                     Floating
      Rate for initial

                     Calculation
      Period:

            	
              3.75554%

            
	
                     Floating
      Rate Option:

            	
              USD-LIBOR-BBA

            
	
                     Designated
      Maturity:

            	
              1
      Month

            
	
                     Spread:

            	
              Plus
      0.85%

            
	
                     Floating
      Rate Day Count

                     Fraction:

            	
              Actual/360

            
	
                     Floating
      Rate determined:

            	
              Two
      London Banking Days prior to each Reset Date.

            
	
                     Reset
      Dates:

            	
              The
      first day of each Calculation Period.

            
	
                     Compounding:

            	
              Inapplicable

            
	
                     Rounding
      convention:

            	
              5
      decimal places per the ISDA Definitions.

            
	
                     Other:

            	
              For
      the avoidance of doubt, for purposes of Section 2(c) of the
      Agreement, any amounts payable by the Floating Rate Payer on a Floating
      Rate Payer Payment Date, and by the Fixed Rate Payer on the related Fixed
      Rate Payer Payment Date, shall be netted even though such dates may be
      different, and the party with the larger aggregate amount shall make the
      net payment on the related party’s applicable Payment
  Date.

            

    

     

    2. The
additional provisions of this Confirmation are as follows:

     

    
      	
              Calculation
      Agent:

            	
              Wachovia

            
	
              Payment
      Instructions:

            	
              Wachovia
      Bank, N.A.

              CIB
      Group, ABA 053000219

              Ref:
      Derivative Desk (Trade No: 2325847)

              Account
      #: 04659360006116

              Attention:
      Derivatives

               

            
	
              Wachovia
      Contacts:

            	
              Settlements
      and/or Rate Resets:

              Tel:
      (800) 249-3865

              Fax:
      (704) 383-9139

               

              Documentation
      :

              Tel:
      (704) 715-7051

              Fax:
      (704) 383-9139

               

              Collateral
      :

            

    

     

    
      
        
        

      

      
        Wachovia: 
2325847

        
          

        

      

      
        3 /
4

      

    

    

    
      	 
      	
              Tel:
      (704) 383-9529

               

              Please
      quote transaction reference number.

               

            
	
              Payments to
      Counterparty:

            	
              U.S.
      Bank N.A.

              ABA:
      091000022

              DDA:
      173103322058

              REF:
      119826000 WALOT 2008-1

            

    

    

    
    

    

    
      	
              Documentation

               

              This
      Confirmation supplements, forms part of, and is subject to, the ISDA
      Master Agreement (including the Schedule and the Credit Support Annex
      thereto) between Wachovia and Counterparty dated as of January 24, 2008 as
      amended and supplemented from time to time (the "ISDA Master Agreement").
      All provisions contained or incorporated by reference in the Master
      Agreement will govern this Confirmation except as expressly modified
      herein.

               

               

            

    

     

    
      
        
        

      

      
        Wachovia: 
2325847

        
          

        

      

      
        4 /
4

      

    

    

    
      	
              Please
      confirm that the foregoing correctly sets forth the terms of our agreement
      by executing a copy of this Confirmation and returning it to us at fax
      number (704) 383-9139.

               

            
	 
      	
              Very
      truly yours,

              Wachovia
      Bank, N.A.

               

               

               

              By:  /s/ Amanda
      Roof                                       
      

              Name:
      Amanda Roof

              Title:  Associate

               

               

               

               

              Ref.
      No. 2325847

               

            
	
               

              Accepted
      and confirmed as of date first above written:

            
	
              WACHOVIA
      AUTO LOAN OWNER TRUST 2008-1

               

              By:
      WILMINGTON TRUST COMPANY, not in its individual

              capacity
      but solely in its capacity as Owner Trustee

            
	
               

               

               

              By:  /s/ Erik
      E. Overcash                                          
      

              Name:
      Erike E. Overcash

              Title:  Financial
      Services Officer

            

    

     

    Wachovia: 
2325847ex10-1.htm

    
 

     

    

     

    LOAN
AND SECURITY AGREEMENT

     

    

     

    PROXIM
WIRELESS CORPORATION

     

    

     

    

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    LOAN
AND SECURITY AGREEMENT

     

    

     

    This LOAN
AND SECURITY AGREEMENT is entered into as of March 28, 2008, by and between
Comerica Bank (“Bank”) and Proxim Wireless Corporation
(“Borrower”).

     

    RECITALS

     

    Borrower
wishes to obtain credit from time to time from Bank, and Bank desires to extend
credit to Borrower.  This Agreement sets forth the terms on which Bank
will advance credit to Borrower, and Borrower will repay the amounts owing to
Bank.

     

    AGREEMENT

     

    The
parties agree as follows:

     

    
      	
              1.

            	
              DEFINITIONS AND
      CONSTRUCTION.

            

    

     

    1.1           Definitions.  As used in
this Agreement, all capitalized terms shall have the definitions set forth on
Exhibit A.  Any term used in the Code and not defined herein shall
have the meaning given to the term in the Code.

     

    
      	
               
      

            	
              1.2

            	
              Accounting
      Terms.  Any accounting term not specifically defined on Exhibit
      A shall be construed in accordance with GAAP and all calculations
      shall be made in accordance with GAAP.  The term “financial
      statements” shall include the accompanying notes and
      schedules.

            

    

     

    
      	
              2.

            	
              LOAN AND TERMS OF
      PAYMENT.

            

    

     

    
      	
               
      

            	
              2.1

            	
              Credit
      Extensions.

            

    

     

    
      	
               
      

            	
              (a)

            	
              Promise to
      Pay.  Borrower promises to pay to Bank, in lawful money
      of the United States of America, the aggregate unpaid principal amount of
      all Credit Extensions made by Bank to Borrower, together with interest on
      the unpaid principal amount of such Credit Extensions at rates in
      accordance with the terms hereof.

            

    

     

    
      	
               
      

            	
              (b)

            	
              Advances Under
      Revolving Line.

            

    

     

    
      	
               
      

            	
              (i)

            	
              Amount.  Subject to
      and upon the terms and conditions of this Agreement (1) Borrower may
      request Advances in an aggregate outstanding amount not to exceed the
      lesser of (A) the Revolving Line or (B) the Borrowing Base, less any
      amounts outstanding under the Letter of Credit Sublimit, the Credit Card
      Services Sublimit and the Foreign Exchange Sublimit, and (2) amounts
      borrowed pursuant to this Section 2.1(b) may be repaid and reborrowed at
      any time prior to the Revolving Maturity Date, at which time all Advances
      under this Section 2.1(b) shall be immediately due and
      payable.  Notwithstanding the foregoing, subject to the terms
      and conditions of this Agreement, Borrower may request
      Advances  in an aggregate outstanding amount not to exceed One
      Million Dollars ($1,000,000) (the “Non-Formula Amount”) without regard to
      the Borrowing Base. Borrower may prepay any Advances without penalty or
      premium.

            

    

     

    
      	
               
      

            	
              (ii)

            	
              Form of
      Request.  Whenever Borrower desires an Advance, Borrower
      will notify Bank by facsimile transmission or telephone no later than 3:00
      p.m. Pacific time (1:00 p.m. Pacific time for wire transfers), on the
      Business Day that the Advance is to be made.  Each such
      notification shall be promptly
confirmed

            

    

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    by a
Payment/Advance Form in substantially the form of Exhibit C.  Bank is
authorized to make Advances under this Agreement, based upon instructions
received from a Responsible Officer or a designee of a Responsible Officer, or
without instructions if in Bank’s discretion such Advances are necessary to meet
Obligations which have become due and remain unpaid.  Bank shall be
entitled to rely on any telephonic notice given by a person who Bank reasonably
believes to be a Responsible Officer or a designee thereof, and Borrower shall
indemnify and hold Bank harmless for any damages or loss suffered by Bank as a
result of such reliance.  Bank will credit the amount of Advances made
under this Section 2.1(b) to Borrower’s deposit account.

     

    
      	
               
      

            	
              (iii)

            	
              Letter of Credit
      Sublimit.  Subject to the availability under the
      Revolving Line, and in reliance on the representations and warranties of
      Borrower set forth herein, at any time and from time to time from the date
      hereof through the Business Day immediately prior to the Revolving
      Maturity Date, Bank shall issue for the account of Borrower such Letters
      of Credit as Borrower may request by delivering to Bank a duly executed
      letter of credit application on Bank’s standard form; provided, however,
      that the outstanding and undrawn amounts under all such Letters of Credit
      (i) shall not at any time exceed the Letter of Credit Sublimit, and (ii)
      shall be deemed to constitute Advances for the purpose of calculating
      availability under the Revolving Line.  Any drawn but
      unreimbursed amounts under any Letters of Credit shall be charged as
      Advances against the Revolving Line. 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 form application and letter
      of credit agreement.  Borrower will pay any standard issuance
      and other fees that Bank notifies Borrower it will charge for issuing and
      processing Letters of Credit.

            

    

     

    
      	
               
      

            	
              (iv)

            	
              Credit Card Services
      Sublimit.  Subject to the terms and conditions of this
      Agreement, Borrower may request corporate credit cards and standard and
      e-commerce merchant account services from Bank (collectively, the “Credit
      Card Services”).  The aggregate limit of the corporate credit
      cards and merchant credit card processing reserves shall not exceed the
      Credit Card Services Sublimit, provided that availability under the
      Revolving Line shall be reduced by the aggregate limits of the corporate
      credit cards issued to Borrower and merchant credit card processing
      reserves.  In addition, Bank may, in its sole discretion, charge
      as Advances any amounts that become due or owing to Bank in connection
      with the Credit Card Services.  The terms and conditions
      (including repayment and fees) of such Credit Card Services shall be
      subject to the terms and conditions of the Bank’s standard forms of
      application and agreement for the Credit Card Services, which Borrower
      hereby agrees to execute.

            

    

     

    
      	
               
      

            	
              (v)

            	
              Foreign Exchange
      Sublimit.  Subject to and upon the terms and conditions
      of this Agreement and any other agreement that Borrower may enter into
      with the Bank in connection with foreign exchange transactions (“FX
      Contracts”), Borrower may request Bank to enter into FX Contracts with
      Borrower due not later than the Revolving Maturity
      Date.  Borrower shall pay any standard issuance and other fees
      that Bank notifies Borrower will be charged for issuing and processing FX
      Contracts for Borrower.  The FX Amount shall at all times be
      equal to or less than Two Hundred Fifty Thousand Dollars
      ($250,000).  The “FX Amount” shall equal the amount determined
      by multiplying (i) the aggregate amount, in United States Dollars, of FX
      Contracts between Borrower and Bank remaining outstanding as of any date
      of determination by (ii) the applicable Foreign Exchange Reserve
      Percentage as of such date.  The “Foreign Exchange Reserve
      Percentage” shall be a percentage as determined by Bank,
  in

            

    

     

    

    
      
        
           

        

        
          2

          
            

          

        

        
           

        

      

    

    

    its sole
discretion from time to time.  The initial Foreign Exchange Reserve
Percentage shall be ten percent (10%).

     

    
      	
               
      

            	
              (vi)

            	
              Collateralization of
      Obligations Extending Beyond Maturity.  If Borrower has
      not secured to Bank’s satisfaction its obligations with respect to any
      Letters of Credit, Credit Card Services or Foreign Exchange Contracts by
      the Revolving Maturity Date, then, effective as of such date, the balance
      in any deposit accounts held by Bank and the certificates of deposit or
      time deposit accounts issued by Bank in Borrower’s name (and any interest
      paid thereon or proceeds thereof, including any amounts payable upon the
      maturity or liquidation of such certificates or accounts), shall
      automatically secure such obligations to the extent of the then continuing
      or outstanding and undrawn Letters of Credit, Credit Card Services, or
      Foreign Exchange Contracts.  Borrower authorizes Bank to hold
      such balances in pledge and to decline to honor any drafts thereon or any
      requests by Borrower or any other Person to pay or otherwise transfer any
      part of such balances for so long as the Letters of Credit, Credit Card
      Services, or Foreign Exchange Contracts are outstanding or
      continue.

            

    

     

    
      	
               
      

            	
              2.2

            	
              Overadvances.  If the
      aggregate amount of the outstanding Advances exceeds the lesser of the
      Revolving Line (inclusive of the aggregate amounts outstanding under the
      Letter of Credit Sublimit, the Credit Card Services Sublimit and the
      Foreign Exchange Sublimit) or the Borrowing Base plus the Non-Formula
      Amount at any time, Borrower shall immediately pay to Bank, in cash, the
      amount of such excess.

            

    

     

    
      	
               
      

            	
              2.3

            	
              Interest Rates,
      Payments, and Calculations.

            

    

     

    
      	
               
      

            	
              (a)

            	
              Interest
      Rates.

            

    

     

    
      	
               
      

            	
              (i)

            	
              Advances.  Except as
      set forth in Section 2.3(b), the Advances shall bear interest, on the
      outstanding daily balance thereof, at a variable rate equal to 0.50% above
      the Prime Rate.

            

    

     

    
      	
               
      

            	
              (b)

            	
              Late Fee; Default
      Rate.  If any payment is not made within 10 days after
      the date such payment is due, Borrower shall pay Bank a late fee equal to
      the lesser of (i) 5% of the amount of such unpaid amount or (ii) the
      maximum amount permitted to be charged under applicable
      law.  All Obligations shall bear interest, from and after the
      occurrence and during the continuance of an Event of Default, at a rate
      equal to 5 percentage points above the interest rate applicable
      immediately prior to the occurrence of the Event of
    Default.

            

    

     

    
      	
               
      

            	
              (c)

            	
              Payments.  Interest
      hereunder shall be due and payable on the 28th
      calendar day of each month during the term hereof.  Bank shall,
      at its option, charge such interest, all Bank Expenses, and all Periodic
      Payments against any of Borrower’s deposit accounts or against the
      Revolving Line, in which case those amounts shall thereafter accrue
      interest at the rate then applicable hereunder.  Any interest
      not paid when due shall be compounded by becoming a part of the
      Obligations, and such interest shall thereafter accrue interest at the
      rate then applicable hereunder.

            

    

     

    
      	
               
      

            	
              (d)

            	
              Computation.  In the
      event the Prime Rate is changed from time to time hereafter, the
      applicable rate of interest hereunder shall be increased or decreased,
      effective as of the day the Prime Rate is changed, by an amount equal to
      such change in the Prime Rate.  All interest chargeable under
      the Loan Documents shall be computed on the basis of a 360 day year for
      the actual number of days elapsed.

            

    

     

    

    
      
        
           

        

        
          3

          
            

          

        

        
           

        

      

    

    

    

     

    
      	
               
      

            	
              2.4

            	
              Crediting
      Payments.  Prior to the occurrence of an Event of
      Default, Bank shall credit a wire transfer of funds, check or other item
      of payment to such deposit account or Obligation as Borrower specifies,
      except that to the extent Borrower uses the Advances to purchase
      Collateral, Borrower’s repayment of the Advances shall apply on a
      “first-in-first-out” basis so that the portion of the Advances used to
      purchase a particular item of Collateral shall be paid in the
      chronological order the Borrower purchased the
      Collateral.  After the occurrence of an Event of Default, Bank
      shall have the right, in its sole discretion, to immediately apply any
      wire transfer of funds, check, or other item of payment Bank may receive
      to conditionally reduce Obligations, but such applications of funds shall
      not be considered a payment on account unless such payment is of
      immediately available federal funds or unless and until such check or
      other item of payment is honored when presented for
      payment.  Notwithstanding anything to the contrary contained
      herein, any wire transfer or payment received by Bank after 12:00 noon
      Pacific time shall be deemed to have been received by Bank as of the
      opening of business on the immediately following Business
      Day.  Whenever any payment to Bank under the Loan Documents
      would otherwise be due (except by reason of acceleration) on a date that
      is not a Business Day, such payment shall instead be due on the next
      Business Day, and additional fees or interest, as the case may be, shall
      accrue and be payable for the period of such
  extension.

            

    

     

    
      	
               
      

            	
              2.5

            	
              Fees.  Borrower shall
      pay to Bank the following:

            

    

     

    
      	
               
      

            	
              (a)

            	
              Facility Fee.  On the
      Closing Date and on the date of each annual anniversary thereafter, a fee
      equal to $26,250, which shall be nonrefundable;
  and

            

    

     

    
      	
               
      

            	
              (b)

            	
              Bank Expenses.  On the
      Closing Date, all Bank Expenses incurred through the Closing Date, and,
      after the Closing Date, all Bank Expenses, as and when they become
      due.

            

    

     

    
      	
               
      

            	
              2.6

            	
              Term.  This
      Agreement shall become effective on the Closing Date and, subject to
      Section 13.7, shall continue in full force and effect for so long
      as any Obligations remain outstanding or Bank has any obligation to make
      Credit Extensions under this Agreement.  Notwithstanding the
      foregoing, Bank shall have the right to terminate its obligation to make
      Credit Extensions under this Agreement immediately and without notice upon
      the occurrence and during the continuance of an Event of
      Default.

            

    

     

    
      	
              3.

            	
              CONDITIONS OF
      LOANS.

            

    

     

    
      	
               
      

            	
              3.1

            	
              Conditions Precedent to Initial Credit
      Extension.  The obligation of Bank to make the initial
      Credit Extension is subject to the condition precedent that Bank shall
      have received, in form and substance satisfactory to Bank, the
      following:

            

    

     

    
      	
               
      

            	
              (a)

            	
              this
      Agreement;

            

    

     

    
      	
               
      

            	
              (b)

            	
              an
      officer’s certificate of Borrower with respect to incumbency and
      resolutions authorizing the execution and delivery of this
      Agreement;

            

    

     

    
      	
               
      

            	
              (c)

            	
              a
      financing statement (Form UCC-1) naming Borrower as
  debtor;

            

    

     

    
      	
               
      

            	
              (d)

            	
              agreement
      to provide insurance;

            

    

     

    
      	
               
      

            	
              (e)

            	
              Release
      of Security Interest in Patents executed by Silicon Valley
      Bank;

            

    

     

    
      	
               
      

            	
              (f)

            	
              Release
      of Security Interest in Patents executed by Warburg Pincus Private Equity
      VIII, L.P.;

            

    

     

    
      	
               
      

            	
              (g)

            	
              Release
      of Security Interest in Trademarks executed by Warburg Pincus Private
      Equity VIII, L.P.;

            

    

     

    

    
      
        
           

        

        
          4

          
            

          

        

        
           

        

      

    

    

    

    
      	
               
      

            	
              (h)

            	
              payment
      of the fees and Bank Expenses then due specified in Section
      2.5;

            

    

     

    
      	
               
      

            	
              (i)

            	
              current
      SOS Reports indicating that except for Permitted Liens, there are no other
      security interests or Liens of record in the
  Collateral;

            

    

     

    
      	
               
      

            	
              (j)

            	
              with
      respect to formula-based Advances, an audit of the Collateral, the results
      of which shall be satisfactory to
Bank;

            

    

     

    
      	
               
      

            	
              (k)

            	
              current
      financial statements, including company prepared consolidated and
      consolidating balance sheets and income statements for the most recently
      ended month in accordance with Section 6.2, and such other updated
      financial information as Bank may reasonably
  request;

            

    

     

    
      	
               
      

            	
              (l)

            	
              current
      Compliance Certificate in accordance with Section 6.2;
  and

            

    

     

    
      	
               
      

            	
              (m)

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

            

    

     

    
      	
               
      

            	
              3.2

            	
              Conditions Precedent to all Credit
      Extensions.  The obligation of Bank to make each Credit
      Extension, including the initial Credit Extension, is further subject to
      the following conditions:

            

    

     

    
      	
               
      

            	
              (a)

            	
              timely
      receipt by Bank of the Payment/Advance Form as provided in Section 2.1;
      and

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      representations and warranties contained in Section 5 shall be true and
      correct in all material respects on and as of the date of such
      Payment/Advance Form and on the effective date of each Credit Extension as
      though made at and as of each such date, and no Event of Default shall
      have occurred and be continuing, or would exist after giving effect to
      such Credit Extension (provided, however, that those representations and
      warranties expressly referring to another date shall be true, correct and
      complete in all material respects as of such date).  The making
      of each Credit Extension shall be deemed to be a representation and
      warranty by Borrower on the date of such Credit Extension as to the
      accuracy of the facts referred to in this Section
  3.2.

            

    

     

    
      	
              4.

            	
              CREATION OF SECURITY
      INTEREST.

            

    

     

    
      	
               
      

            	
              4.1

            	
              Grant of Security
      Interest.  Borrower grants and pledges to Bank a
      continuing security interest in the Collateral to secure prompt repayment
      of any and all Obligations and to secure prompt performance by Borrower of
      each of its covenants and duties under the Loan
      Documents.  Except as set forth in the Schedule, such security
      interest constitutes a valid, first priority security interest in the
      presently existing Collateral, and will constitute a valid, first priority
      security interest in later-acquired Collateral.  Notwithstanding
      any termination, Bank’s Lien on the Collateral shall remain in effect for
      so long as any Obligations are
outstanding.

            

    

     

    
      	
               
      

            	
              4.2

            	
              Perfection of Security
      Interest.  Borrower authorizes Bank to file at any time
      financing statements, continuation statements, and amendments thereto that
      (i) either specifically describe the Collateral or describe the Collateral
      as all assets of Borrower of the kind pledged hereunder, and (ii) contain
      any other information required by the Code for the sufficiency of filing
      office acceptance of any financing statement, continuation statement, or
      amendment, including whether Borrower is an organization, the type of
      organization and any organizational identification number issued to
      Borrower, if applicable.  Any such financing statements may be
      signed by Bank on behalf of Borrower, as provided in the Code, and may be
      filed at any time in any jurisdiction whether or not Revised Article 9 of
      the Code is then in effect in that jurisdiction.  Borrower shall
      from time to time endorse and deliver to Bank, at the request of Bank, all
      Negotiable Collateral and other documents that Bank may reasonably
      request, in form satisfactory to Bank, to perfect and continue perfected
      Bank’s security interests in the Collateral and in order to fully
      consummate all of the

            

    

     

    

    
      
        
           

        

        
          5

          
            

          

        

        
           

        

      

    

    

    transactions
contemplated under the Loan Documents.  Borrower shall have possession
of the Collateral, except where expressly otherwise provided in this Agreement
or where Bank chooses to perfect its security interest by possession in addition
to the filing of a financing statement.  Where Collateral is in
possession of a third party bailee, Borrower shall take such steps as Bank
reasonably requests for Bank to (i) obtain an acknowledgment, in form and
substance satisfactory to Bank, of the bailee that the bailee holds such
Collateral for the benefit of Bank, or (ii) obtain “control” of any Collateral
consisting of investment property, deposit accounts, letter-of-credit rights or
electronic chattel paper (as such items and the term “control” are defined in
Revised Article 9 of the Code) by causing the securities intermediary or
depositary institution or issuing bank to execute a control agreement in form
and substance satisfactory to Bank.  Borrower will not create any
chattel paper without placing a legend on the chattel paper acceptable to Bank
indicating that Bank has a security interest in the chattel
paper.  Borrower from time to time may deposit with Bank specific cash
collateral to secure specific Obligations; Borrower authorizes Bank to hold such
specific balances in pledge and to decline to honor any drafts thereon or any
request by Borrower or any other Person to pay or otherwise transfer any part of
such balances for so long as the specific Obligations are
outstanding.

     

    
      	
               
      

            	
              4.3

            	
              Right to
      Inspect.  Bank  (through any of its officers,
      employees, or agents) shall have the right, upon reasonable prior notice,
      from time to time during Borrower’s usual business hours but no more than
      twice a year (unless an Event of Default has occurred and is continuing),
      to inspect Borrower’s Books and to make copies thereof and to check, test,
      and appraise the Collateral in order to verify Borrower’s financial
      condition or the amount, condition of, or any other matter relating to,
      the Collateral.

            

    

     

    
      	
              5.

            	
              REPRESENTATIONS AND
      WARRANTIES.

            

    

     

    Borrower
represents and warrants as follows:

     

    
      	
               
      

            	
              5.1

            	
              Due Organization and
      Qualification.  Borrower and each Subsidiary is a
      corporation duly existing under the laws of the state in which it is
      incorporated and qualified and licensed to do business in any state in
      which the conduct of its business or its ownership of property requires
      that it be so qualified, except where the failure to do so would not
      reasonably be expected to cause a Material Adverse
  Effect.

            

    

     

    
      	
               
      

            	
              5.2

            	
              Due Authorization; No
      Conflict.  The execution, delivery, and performance of
      the Loan Documents are within Borrower’s powers, have been duly
      authorized, and are not in conflict with nor constitute a breach of any
      provision contained in Borrower’s Certificate of Incorporation or Bylaws,
      nor will they constitute an event of default under any material agreement
      by which Borrower is bound.  Borrower is not in default under
      any agreement by which it is bound, except to the extent such default
      would not reasonably be expected to cause a Material Adverse
      Effect.

            

    

     

    
      	
               
      

            	
              5.3

            	
              Collateral.  Borrower
      has rights in or the power to transfer the Collateral, and its title to
      the Collateral is free and clear of Liens, adverse claims, and
      restrictions on transfer or pledge except for Permitted
      Liens.  All Collateral is located solely in the Collateral
      States, except as provided in the Schedule.  The Eligible
      Accounts are bona fide existing obligations.  The property or
      services giving rise to such Eligible Accounts has been delivered or
      rendered to the account debtor or its agent for immediate shipment to and
      unconditional acceptance by the account debtor.  Borrower has
      not received notice of actual or imminent Insolvency Proceeding of any
      account debtor whose accounts are included in any Borrowing Base
      Certificate as an Eligible Account.  All Inventory is in all
      material respects of good and merchantable quality, free from all material
      defects, except for Inventory for which adequate reserves have been
      made.  Except as set forth in the Schedule, none of the
      Collateral is maintained or invested with a Person other than Bank or
      Bank’s Affiliates.

            

    

     

    
      	
               
      

            	
              5.4

            	
              Intellectual
      Property.  Borrower is the sole owner of the Intellectual
      Property, except for licenses granted by Borrower to its customers in the
      ordinary course of business.  To the best of Borrower’s
      knowledge, each of the Copyrights, Trademarks and Patents is valid and
      enforceable,

            

    

     

    

    
      
        
           

        

        
          6

          
            

          

        

        
           

        

      

    

    

    and no
part of the Intellectual Property has been judged invalid or unenforceable, in
whole or in part, and no claim has been made to Borrower 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 cause a Material Adverse
Effect.

     

    
      	
               
      

            	
              5.5

            	
              Name;
      Location of Chief Executive Office.  Except as disclosed in the
      Schedule, Borrower has not done business under any name other than that
      specified on the signature page hereof, and its exact legal name is as set
      forth in the first paragraph of this Agreement.  The chief
      executive office of Borrower is located in the Chief Executive Office
      State at the address indicated in Section 10
  hereof.

            

    

     

    
      	
               
      

            	
              5.6

            	
              Litigation.  Except
      as set forth in the Schedule, there are no actions or proceedings pending
      by or against Borrower or any Subsidiary before any court or
      administrative agency in which a likely adverse decision would reasonably
      be expected to have a Material Adverse Effect.  Notwithstanding
      the disclosure on the Schedule of the New York Litigation (as defined on
      the Schedule) and the Texas Litigation (as defined on the Schedule), Bank
      does not waive any of its rights or remedies under this Agreement in the
      event that either the New York Litigation or the Texas Litigation has a
      Material Adverse Effect.

            

    

     

    
      	
               
      

            	
              5.7

            	
              No
      Material Adverse Change in Financial Statements.  All
      consolidated and consolidating financial statements related to Borrower
      and any Subsidiary that are delivered by Borrower to Bank fairly present
      in all material respects Borrower’s consolidated and consolidating
      financial condition as of the date thereof and Borrower’s consolidated and
      consolidating results of operations for the period then
      ended.  There has not been a material adverse change in the
      consolidated or in the consolidating financial condition of Borrower since
      the date of the most recent of such financial statements submitted to
      Bank.

            

    

     

    
      	
               
      

            	
              5.8

            	
              Solvency,
      Payment of Debts.  Borrower is able to pay its debts (including
      trade debts) as they mature; the fair saleable value of Borrower’s assets
      (including goodwill minus disposition costs) exceeds the fair value of its
      liabilities; and Borrower is not left with unreasonably small capital
      after the transactions contemplated by this
  Agreement.

            

    

     

    
      	
               
      

            	
              5.9

            	
              Compliance
      with Laws and Regulations.  Borrower and each Subsidiary have
      met the minimum funding requirements of ERISA with respect to any employee
      benefit plans subject to ERISA.  No event has occurred resulting
      from Borrower’s failure to comply with ERISA that is reasonably likely to
      result in Borrower’s incurring any liability that could have a Material
      Adverse Effect.  Borrower is not an “investment company” or a
      company “controlled” by an “investment company” within the meaning of the
      Investment Company Act of 1940.  Borrower is not engaged
      principally, or as one of the important activities, in the business of
      extending credit for the purpose of purchasing or carrying margin stock
      (within the meaning of Regulations T and U of the Board of Governors of
      the Federal Reserve System).  Borrower has complied in all
      material respects with all the provisions of the Federal Fair Labor
      Standards Act.  Borrower is in compliance with all environmental
      laws, regulations and ordinances except where the failure to comply is not
      reasonably likely to have a Material Adverse Effect.  Borrower
      has not violated any statutes, laws, ordinances or rules applicable to it,
      the violation of which would reasonably be expected to have a Material
      Adverse Effect.  Borrower and each Subsidiary have filed or
      caused to be filed all tax returns required to be filed, and have paid, or
      have made adequate provision for the payment of, all taxes reflected
      therein except those being contested in good faith with adequate reserves
      under GAAP or where the failure to file such returns or pay such taxes
      would not reasonably be expected to have a Material Adverse
      Effect.

            

    

     

    
      	
               
      

            	
              5.10

            	
              Subsidiaries.  Borrower
      does not own any stock, partnership interest or other equity securities of
      any Person, except for Permitted
Investments.

            

    

     

    
      	
               
      

            	
              5.11

            	
              Government
      Consents.  Borrower and each Subsidiary have obtained all
      consents, approvals and authorizations of, made all declarations or
      filings with, and given all notices to, all
  governmental

            

    

     

    

    
      
        
           

        

        
          7

          
            

          

        

        
           

        

      

    

    

    authorities
that are necessary for the continued operation of Borrower’s business as
currently conducted, except where the failure to do so would not reasonably be
expected to cause a Material Adverse Effect.

     

    
      	
               
      

            	
              5.12

            	
              Inbound
      Licenses.  Except as disclosed on the Schedule, Borrower is not
      a party to, nor is bound by, any license or other agreement that prohibits
      or otherwise restricts Borrower from granting a security interest in
      Borrower’s interest in such license or agreement or any other
      property.

            

    

     

    
      	
               
      

            	
              5.13

            	
              Full
      Disclosure.  No representation, warranty or other statement made
      by Borrower in any certificate or written statement furnished to Bank
      taken together with all such certificates and written statements furnished
      to Bank contains any untrue statement of a material fact or omits to state
      a material fact necessary in order to make the statements contained in
      such 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 to be viewed as facts and
      that actual results during the period or periods covered by any such
      projections and forecasts may differ from the projected or forecasted
      results.

            

    

     

    
      	
              6.

            	
              AFFIRMATIVE
      COVENANTS.

            

    

     

    Borrower
covenants that, until payment in full of all outstanding Obligations, and for so
long as Bank may have any commitment to make a Credit Extension hereunder,
Borrower shall do all of the following:

     

    
      	
               
      

            	
              6.1

            	
              Good
      Standing and Government Compliance.  Borrower shall maintain its
      and each of its Subsidiaries’ corporate existence and good standing in
      their respective states of incorporation, shall maintain qualification and
      good standing in each other jurisdiction in which the failure to so
      qualify would reasonably be expected to have a Material Adverse Effect,
      and shall furnish to Bank the organizational identification number issued
      to Borrower by the authorities of the state in which Borrower is
      organized, if applicable.  Borrower shall meet, and shall cause
      each Subsidiary to meet, the minimum funding requirements of ERISA with
      respect to any employee benefit plans subject to
      ERISA.  Borrower shall comply in all material respects with all
      applicable Environmental Laws, and maintain all material permits, licenses
      and approvals required thereunder where the failure to do so would
      reasonably be expected to have a Material Adverse
      Effect.  Borrower shall comply, and shall cause each Subsidiary
      to comply, with all statutes, laws, ordinances and government rules and
      regulations to which it is subject, and shall maintain, and shall cause
      each of its Subsidiaries to maintain, in force all licenses, approvals and
      agreements, the loss of which or failure to comply with which would
      reasonably be expected to have a Material Adverse
  Effect.

            

    

     

    
      	
               
      

            	
              6.2

            	
              Financial
      Statements, Reports, Certificates.  Borrower shall deliver to
      Bank:  (i) as soon as available, but in any event within 20 days
      after the end of each calendar month, a company prepared consolidated and
      consolidating balance sheet and income statement covering Borrower’s
      operations during such period, prepared in accordance with GAAP,
      consistently applied, in a form reasonably acceptable to Bank and
      certified by a Responsible Officer; (ii) as soon as available, but in any
      event within 50 days after the end of each fiscal quarter of Borrower, a
      company prepared consolidated and consolidating balance sheet and income
      statement covering Borrower’s operations during such period, prepared in
      accordance with GAAP, consistently applied, in a form reasonably
      acceptable to Bank and certified by a Responsible Officer; (iii) as soon
      as available, but in any event within 95 days after the end of Borrower’s
      fiscal year, audited consolidated and consolidating financial statements
      of Borrower prepared in accordance with GAAP, consistently applied,
      together with an opinion which is unqualified or otherwise consented to in
      writing by Bank on such financial statements of an independent certified
      public accounting firm reasonably acceptable to Bank; (iv) if applicable,
      copies of all statements, reports and notices sent or made available
      generally by Borrower to its security holders or to any holders of
      Subordinated Debt and all reports on Forms 10-K and 10-Q filed with the
      Securities and Exchange Commission; (v) promptly upon receipt of notice
      thereof, a report of any legal actions pending or threatened against
      Borrower or any Subsidiary that could result in damages or costs to
      Borrower or any Subsidiary of 

            

    

     

    

    
      
        
           

        

        
          8

          
            

          

        

        
           

        

      

    

    

    $250,000
or more; (vi) promptly upon receipt, each management letter prepared by
Borrower’s independent certified public accounting firm regarding Borrower’s
management control systems; and (vii) such budgets, sales projections, operating
plans or other financial information generally prepared by Borrower in the
ordinary course of business as Bank may reasonably request from time to time;
(viii) within 95 days after the last day of each fiscal year of Borrower, a
report signed by Borrower, in form reasonably acceptable to Bank, listing any
applications or registrations that Borrower has made or filed in respect of any
Patents, Copyrights or Trademarks and the status of any outstanding applications
or registrations, as well as any material change in Borrower’s Intellectual
Property.

     

    
      	
               
      

            	
              (a)

            	
              Within
      20 days after the last day of each month, Borrower shall deliver to Bank a
      Borrowing Base Certificate signed by a Responsible Officer in
      substantially the form of Exhibit D hereto, together with aged listings by
      invoice date of accounts receivable and accounts payable and a Pass
      Through Reports (re Distributors) in form and substance acceptable to
      Bank.

            

    

     

    
      	
               
      

            	
              (b)

            	
              Within
      20 days after the last day of each month, Borrower shall deliver to Bank
      with the monthly financial statements a Compliance Certificate certified
      as of the last day of the applicable month and signed by a Responsible
      Officer in substantially the form of Exhibit E
  hereto.

            

    

     

    
      	
               
      

            	
              (c)

            	
              As
      soon as possible and in any event within 3 calendar days after becoming
      aware of the occurrence or existence of an Event of Default hereunder, a
      written statement of a Responsible Officer setting forth details of the
      Event of Default, and the action which Borrower has taken or proposes to
      take with respect thereto.

            

    

     

    
      	
               
      

            	
              (d)

            	
              Bank
      shall have a right from time to time hereafter to audit Borrower’s
      Accounts and appraise Collateral at Borrower’s expense, provided that such
      audits will be conducted no more often than every 6 months unless an Event
      of Default has occurred and is
continuing.

            

    

     

    Borrower
may deliver to Bank on an electronic basis any certificates, reports or
information required pursuant to this Section 6.2, and Bank shall be entitled to
rely on the information contained in the electronic files, provided that Bank in
good faith believes that the files were delivered by a Responsible
Officer.  If Borrower delivers this information electronically, it
shall also deliver to Bank by U.S. Mail, reputable overnight courier service,
hand delivery, facsimile or .pdf file within 5 Business Days of submission of
the unsigned electronic copy the certification of monthly financial statements,
the Borrowing Base Certificate and the Compliance Certificate, each bearing the
physical signature of the Responsible Officer.

     

    
      	
               
      

            	
              6.3

            	
              Inventory;
      Returns.  Borrower shall keep all Inventory in good and
      merchantable condition, free from all material defects except for
      Inventory for which adequate reserves have been made.  Returns
      and allowances, if any, as between Borrower and its account debtors shall
      be on the same basis and in accordance with the usual customary practices
      of Borrower, as they exist on the Closing Date.  Borrower shall
      promptly notify Bank of all returns and recoveries and of all disputes and
      claims involving more than
$100,000.

            

    

     

    
      	
               
      

            	
              6.4

            	
              Taxes.  Borrower
      shall make, and cause each Subsidiary to make, due and timely payment or
      deposit of all material federal, state, and local taxes, assessments, or
      contributions required of it by law, including, but not limited to, those
      laws concerning income taxes, F.I.C.A., F.U.T.A. and state disability, and
      will execute and deliver to Bank, on demand, proof satisfactory to Bank
      indicating that Borrower or a Subsidiary has made such payments or
      deposits and any appropriate certificates attesting to the payment or
      deposit thereof; provided that Borrower or a Subsidiary need not make any
      payment if the amount or validity of such payment is contested in good
      faith by appropriate proceedings and is reserved against (to the extent
      required by GAAP) by Borrower.

            

    

     

    
      	
               
      

            	
              6.5

            	
              Insurance.

            

    

     

    

    

    
      
        
           

        

        
          9

          
            

          

        

        
           

        

      

    

    

    

    
      	
               
      

            	
              (a)

            	
              Borrower,
      at its expense, shall keep the Collateral insured against loss or damage
      by fire, theft, explosion, sprinklers, and all other hazards and risks,
      and in such amounts, as ordinarily insured against by other owners in
      similar businesses conducted in the locations where Borrower’s business is
      conducted on the date hereof.  Borrower shall also maintain
      liability and other insurance in amounts and of a type that are customary
      to businesses similar to
Borrower’s.

            

    

     

    
      	
               
      

            	
              (b)

            	
              All
      such policies of insurance shall be in such form, with such companies, and
      in such amounts as reasonably satisfactory to Bank.  All
      policies of property insurance shall contain a lender’s loss payable
      endorsement, in a form satisfactory to Bank, showing Bank as an additional
      loss payee, and all liability insurance policies shall show Bank as an
      additional insured and specify that the insurer must give at least 20 days
      notice to Bank before canceling its policy for any reason.  Upon
      Bank’s request, Borrower shall deliver to Bank certified copies of the
      policies of insurance and evidence of all premium payments.  If
      no Event of Default has occurred and is continuing, proceeds payable under
      any casualty policy will, at Borrower’s option, be payable to Borrower to
      replace the property subject to the claim, provided that any such
      replacement property shall be deemed Collateral in which Bank has been
      granted a first priority security interest.  If an Event of
      Default has occurred and is continuing, all proceeds payable under any
      such policy shall, at Bank’s option, be payable to Bank to be applied on
      account of the Obligations.

            

    

     

    
      	
               
      

            	
              6.6

            	
              Primary
      Depository.  Borrower shall maintain all its primary depository,
      operating and investment accounts with Bank or Bank’s Affiliates. Within
      15 days after the Closing Date, any account maintained with an entity
      other than Bank shall be governed by a control agreement in favor of Bank
      and in form and substance acceptable to Bank. Notwithstanding the
      foregoing, the aggregate balance of all accounts maintained by Borrower
      with entities whose principal place of business is located outside of the
      United States shall not exceed $250,000 at any time, which foreign
      accounts are not required to be governed by a control agreement in favor
      of Bank.

            

    

     

    
      	
               
      

            	
              6.7

            	
              Financial
      Covenant. Borrower shall at all times maintain the following financial
      covenant:

            

    

     

    
      	
               
      

            	
              (a)

            	
              Adjusted
      Quick Ratio.  A ratio of Cash plus Eligible Accounts to Current
      Liabilities less Deferred Revenue of at least 1.05 to 1.00, measured on a
      monthly basis.

            

    

     

    
      	
               
      

            	
              6.8

            	
              Registration of
      Intellectual Property
Rights.

            

    

     

    
      	
               
      

            	
              (a)

            	
              Borrower
      shall register or cause to be registered (to the extent not already
      registered) with the United States Patent and Trademark Office or the
      United States Copyright Office, as the case may be, those registrable
      intellectual property rights now owned or hereafter developed or acquired
      by Borrower, to the extent that Borrower, in its sole reasonable business
      judgment, deems it appropriate to so protect such intellectual property
      rights.

            

    

     

    
      	
               
      

            	
              (b)

            	
              Borrower
      shall (i) protect, defend and maintain the validity and enforceability of
      its material trade secrets, Trademarks, Patents and Copyrights, to the
      extent it deems it appropriate in its reasonable business judgment, (ii)
      use commercially reasonable efforts to detect infringements of the
      Trademarks, Patents and Copyrights and (iii) not allow any material
      Trademarks, Patents or Copyrights to be abandoned, forfeited or dedicated
      to the public.

            

    

     

    
      	
               
      

            	
              6.9

            	
              Consent
      of Inbound Licensors.  Within 3 Business Days after entering
      into or becoming bound by any material license agreement, Borrower shall
      provide written notice to Bank of the material terms of such license
      agreement with a description of its likely impact on Borrower’s business
      or financial condition.

            

    

     

    

    
      
        
           

        

        
          10

          
            

          

        

        
           

        

      

    

    

    

     

    
      	
               
      

            	
              6.10

            	
              Further
      Assurances.  At any time and from time to time Borrower shall
      execute and deliver such further instruments and take such further action
      as may reasonably be requested by Bank to effect the purposes of this
      Agreement.

            

    

     

    
      	
              7.

            	
              NEGATIVE
      COVENANTS.

            

    

     

    Borrower
covenants and agrees that, so long as any credit hereunder shall be available
and until the outstanding Obligations are paid in full or for so long as Bank
may have any commitment to make any Credit Extensions, Borrower will not do any
of the following without Bank’s prior written consent:

     

    
      	
               
      

            	
              7.1

            	
              Dispositions.  Convey,
      sell, lease, license, transfer or otherwise dispose of (collectively, to
      “Transfer”), or permit any of its Subsidiaries to Transfer, all or any
      part of its business or property, or move cash balances on deposit with
      Bank to accounts opened at another financial institution, other than
      Permitted Transfers.

            

    

     

    
      	
               
      

            	
              7.2

            	
              Change
      in Name, Location, Executive Office, or Executive Management; Change in
      Business; Change in Fiscal Year; Change in Control.  Change its
      name or the Borrower State or relocate its chief executive office without
      30 days prior written notification to Bank; replace its chief executive
      officer or chief financial officer without 30 days prior written
      notification to Bank; engage in any business, or permit any of its
      Subsidiaries to engage in any business, other than or reasonably related
      or incidental to the businesses currently engaged in by Borrower; change
      its fiscal year end; have a Change in
Control.

            

    

     

    
      	
               
      

            	
              7.3

            	
              Mergers
      or Acquisitions.  Merge or consolidate, or permit any of its
      Subsidiaries to merge or consolidate, with or into any other business
      organization (other than mergers or consolidations of a Subsidiary into
      another Subsidiary or into Borrower), or acquire, or permit any of its
      Subsidiaries to acquire, all or substantially all of the capital stock or
      property of another Person except where (i) such transactions do not in
      the aggregate exceed $250,000 during any fiscal year, (ii) no Event of
      Default has occurred, is continuing or would exist after giving effect to
      such transactions, (iii)such transactions do not result in a Change in
      Control, and (iv) Borrower is the surviving
  entity.

            

    

     

    
      	
               
      

            	
              7.4

            	
              Indebtedness.  Create,
      incur, assume, guarantee or be or remain liable with respect to any
      Indebtedness, or permit any Subsidiary so to do, other than Permitted
      Indebtedness, or prepay any Indebtedness or take any actions which impose
      on Borrower an obligation to prepay any Indebtedness, including without
      limitation prepayments of indebtedness owed by Borrower in connection with
      the Symbol Technology license agreement, except Indebtedness to
      Bank.

            

    

     

    
      	
               
      

            	
              7.5

            	
              Encumbrances.  Create,
      incur, assume or allow any Lien with respect to any of its property,
      including its Intellectual Property, or assign or otherwise convey any
      right to receive income, including the sale of any Accounts, or permit any
      of its Subsidiaries so to do, except for Permitted Liens, or covenant to
      any other Person that Borrower in the future will refrain from creating,
      incurring, assuming or allowing any Lien with respect to any of Borrower’s
      property, including Borrower’s Intellectual
  Property.

            

    

     

    
      	
               
      

            	
              7.6

            	
              Distributions.  Pay
      any dividends or make any other distribution or payment on account of or
      in redemption, retirement or purchase of any capital stock, except that
      Borrower may repurchase the stock of former employees pursuant to stock
      repurchase agreements as long as an Event of Default does not exist prior
      to such repurchase or would not exist after giving effect to such
      repurchase.

            

    

     

    
      	
               
      

            	
              7.7

            	
              Investments.  Directly
      or indirectly acquire or own, or make any Investment in or to any Person,
      or permit any of its Subsidiaries so to do, other than Permitted
      Investments, or maintain or invest any of its property with a Person other
      than Bank or Bank’s Affiliates or permit any Subsidiary to do so unless
      such Person has entered into a control agreement with Bank, in form and
      substance satisfactory to Bank, or suffer or permit any Subsidiary to be a
      party to, or be bound by, an

            

    

     

    

    
      
        
           

        

        
          11

          
            

          

        

        
           

        

      

    

    

    agreement
that restricts such Subsidiary from paying dividends or otherwise distributing
property to Borrower.

     

    
      	
               
      

            	
              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.  Make any payment in respect of any Subordinated Debt, or
      permit any of its Subsidiaries to make any such payment, except in
      compliance with the terms of such Subordinated Debt, or amend any
      provision affecting Bank’s rights contained in any documentation relating
      to the Subordinated Debt without Bank’s prior written
    consent.

            

    

     

    
      	
               
      

            	
              7.10

            	
              Inventory
      and Equipment.  Store (except as provided in the Schedule) the
      Inventory or the Equipment with a bailee, warehouseman, or similar third
      party unless the third party has been notified of Bank’s security interest
      and Bank (a) has received an acknowledgment from the third party that it
      is holding or will hold the Inventory or Equipment for Bank’s benefit or
      (b) is in possession of the warehouse receipt, where negotiable, covering
      such Inventory or Equipment.  Except for Inventory sold in the
      ordinary course of business, except as provided in the Schedule, and
      except for such other locations as Bank may approve in writing, Borrower
      shall keep the Inventory and Equipment only at the location set forth in
      Section 10 and such other locations of which Borrower gives Bank prior
      written notice and as to which Bank files a financing statement where
      needed to perfect its security
interest.

            

    

     

    
      	
               
      

            	
              7.11

            	
              No
      Investment Company; Margin Regulation.  Become or be controlled
      by an “investment company,” within the meaning of the Investment Company
      Act of 1940, or become principally engaged in, or undertake as one of its
      important activities, the business of extending credit for the purpose of
      purchasing or carrying margin stock, or use the proceeds of any Credit
      Extension for such purpose.

            

    

     

    
      	
              8.

            	
              EVENTS OF
      DEFAULT.

            

    

     

    Any one
or more of the following events shall constitute an Event of Default by Borrower
under this Agreement:

     

    
      	
               
      

            	
              8.1

            	
              Payment
      Default.  If Borrower fails to pay any of the Obligations when
      due;

            

    

     

    
      	
               
      

            	
              8.2

            	
              Covenant
      Default.

            

    

     

    
      	
               
      

            	
              (a)

            	
              If
      Borrower fails to perform any obligation under Article 6 or violates any
      of the covenants contained in Article 7 of this Agreement;
    or

            

    

     

    
      	
               
      

            	
              (b)

            	
              If
      Borrower fails or neglects to perform or observe any other material term,
      provision, condition, covenant contained in this Agreement, in any of the
      Loan Documents, or in any other present or future agreement between
      Borrower and Bank and as to any default under such other term, provision,
      condition or covenant that can be cured, has failed to cure such default
      within 10 days after Borrower receives notice thereof or any officer of
      Borrower becomes aware thereof; provided, however, that if the default
      cannot by its nature be cured within the 10 day period or cannot after
      diligent attempts by Borrower be cured within such 10 day period, and such
      default is likely to be cured within a reasonable time, then Borrower
      shall have an additional reasonable period (which shall not in any case
      exceed 30 days) to attempt to cure such default, and within such
      reasonable time period the failure to have cured such default shall not be
      deemed an Event of Default but no Credit Extensions will be
      made;

            

    

     

    

    
      
        
           

        

        
          12

          
            

          

        

        
           

        

      

    

    

    

    
      	
               
      

            	
              8.3

            	
              Material
      Adverse Change.  If there occurs a material adverse change in
      Borrower’s prospects, business or financial condition taken as a whole, or
      if there is a material impairment in the prospect of repayment of any
      portion of the Obligations or a material impairment in the perfection,
      value (taken as a whole)  or priority of Bank’s security
      interests in the Collateral (except as provided in the
      Schedule);

            

    

     

    
      	
               
      

            	
              8.4

            	
              Defective
      Perfection.  If Bank shall receive at any time following the
      Closing Date an SOS Report indicating that except for Permitted Liens,
      Bank’s security interest in the Collateral is not prior to all other
      security interests or Liens of record reflected in the
    report;

            

    

     

    
      	
               
      

            	
              8.5

            	
              Attachment.  If
      any material portion of Borrower’s assets is attached, seized, subjected
      to a writ or distress warrant, or is levied upon, or comes into the
      possession of any trustee, receiver or person acting in a similar capacity
      and such attachment, seizure, writ or distress warrant or levy has not
      been removed, discharged or rescinded within 10 days, or if Borrower is
      enjoined, restrained, or in any way prevented by court order from
      continuing to conduct all or any material part of its business affairs, or
      if a judgment or other claim becomes a lien or encumbrance upon any
      material portion of Borrower’s assets, or if a notice of lien, levy, or
      assessment is filed of record with respect to any of Borrower’s assets by
      the United States Government, or any department, agency, or
      instrumentality thereof, or by any state, county, municipal, or
      governmental agency, and the same is not paid within ten days after
      Borrower receives notice thereof, provided that none of the foregoing
      shall constitute an Event of Default where such action or event is stayed
      or an adequate bond has been posted pending a good faith contest by
      Borrower (provided that no Credit Extensions will be made during such cure
      period);

            

    

     

    
      	
               
      

            	
              8.6

            	
              Insolvency.  If
      Borrower becomes insolvent, or if an Insolvency Proceeding is commenced by
      Borrower, or if an Insolvency Proceeding is commenced against Borrower and
      is not dismissed or stayed within 30 days (provided that no Credit
      Extensions will be made prior to the dismissal of such Insolvency
      Proceeding);

            

    

     

    
      	
               
      

            	
              8.7

            	
              Other
      Agreements.  If there is a default or other failure to perform
      in any agreement to which Borrower is a party with a third party or
      parties resulting in a right by such third party or parties, whether or
      not exercised, to accelerate the maturity of any Indebtedness in an amount
      in excess of $250,000 or that would reasonably be expected to have a
      Material Adverse Effect;

            

    

     

    
      	
               
      

            	
              8.8

            	
              Subordinated
      Debt.  If Borrower makes any payment on account of Subordinated
      Debt, except to the extent the payment is allowed under any subordination
      agreement entered into with Bank;

            

    

     

    
      	
               
      

            	
              8.9

            	
              Judgments.  If
      a judgment or judgments for the payment of money in an amount,
      individually or in the aggregate, of at least $250,000 shall be rendered
      against Borrower and shall remain unsatisfied and unstayed for a period of
      10 days (provided that no Credit Extensions will be made prior to the
      satisfaction or stay of the judgment);
or

            

    

     

    
      	
               
      

            	
              8.10

            	
              Misrepresentations.  If
      any material misrepresentation or material misstatement exists now or
      hereafter in any warranty or representation set forth herein or in any
      certificate delivered to Bank by any Responsible Officer pursuant to this
      Agreement or to induce Bank to enter into this Agreement or any other Loan
      Document.

            

    

     

    
      	
              9.

            	
              BANK’S RIGHTS AND
      REMEDIES.

            

    

     

    
      	
               
      

            	
              9.1

            	
              Rights
      and Remedies.  Upon the occurrence and during the continuance of
      an Event of Default, Bank may, at its election, without notice of its
      election and without demand, do any one or more of the following, all of
      which are authorized by Borrower:

            

    

     

    
      	
               
      

            	
              (a)

            	
              Declare
      all Obligations, whether evidenced by this Agreement, by any of the other
      Loan Documents, or otherwise, immediately due and payable (provided that
      upon the

            

    

     

    

    
      
        
           

        

        
          13

          
            

          

        

        
           

        

      

    

    

    occurrence
of an Event of Default described in Section 8.6 (insolvency), all Obligations
shall become immediately due and payable without any action by
Bank);

     

    
      	
               
      

            	
              (b)

            	
              Demand
      that Borrower  (i) deposit cash with Bank in an amount equal to
      the amount of any Letters of Credit remaining undrawn, as collateral
      security for the repayment of any future drawings under such Letters of
      Credit, and (ii) pay in advance all Letter of Credit fees scheduled to be
      paid or payable over the remaining term of the Letters of Credit, and
      Borrower shall promptly deposit and pay such
  amounts;

            

    

     

    
      	
               
      

            	
              (c)

            	
              Cease
      advancing money or extending credit to or for the benefit of Borrower
      under this Agreement or under any other agreement between Borrower and
      Bank;

            

    

     

    
      	
               
      

            	
              (d)

            	
              Settle
      or adjust disputes and claims directly with account debtors for amounts,
      upon terms and in whatever order that Bank reasonably considers
      advisable;

            

    

     

    
      	
               
      

            	
              (e)

            	
              Make
      such payments and do such acts as Bank considers necessary or reasonable
      to protect its security interest in the Collateral.  Borrower
      agrees to assemble the Collateral if Bank so requires, and to make the
      Collateral available to Bank as Bank may designate.  Borrower
      authorizes Bank to enter the premises where the Collateral is located, to
      take and maintain possession of the Collateral, or any part of it, and to
      pay, purchase, contest, or compromise any encumbrance, charge, or lien
      which in Bank’s determination appears to be prior or superior to its
      security interest and to pay all expenses incurred in connection
      therewith.  With respect to any of Borrower’s owned premises,
      Borrower hereby grants Bank a license to enter into possession of such
      premises and to occupy the same, without charge, in order to exercise any
      of Bank’s rights or remedies provided herein, at law, in equity, or
      otherwise;

            

    

     

    
      	
               
      

            	
              (f)

            	
              Set
      off and apply to the Obligations any and all (i) balances and deposits of
      Borrower held by Bank, and (ii) indebtedness at any time owing to or for
      the credit or the account of Borrower held by
  Bank;

            

    

     

    
      	
               
      

            	
              (g)

            	
              Ship,
      reclaim, recover, store, finish, maintain, repair, prepare for sale,
      advertise for sale, and sell (in the manner provided for herein) the
      Collateral.  Bank is hereby granted a license or other right,
      solely pursuant to the provisions of this Section 9.1, to use, without
      charge, Borrower’s labels, patents, copyrights, rights of use of any name,
      trade secrets, trade names, trademarks, service marks, and advertising
      matter, or any property of a similar nature, 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 9.1, Borrower’s rights under all licenses and all franchise
      agreements shall inure to Bank’s
benefit;

            

    

     

    
      	
               
      

            	
              (h)

            	
              Sell
      the Collateral at either a public or private sale, or both, by way of one
      or more contracts or transactions, for cash or on terms, in such manner
      and at such places (including Borrower’s premises) as Bank determines is
      commercially reasonable, and apply any proceeds to the Obligations in
      whatever manner or order Bank deems appropriate.  Bank may sell
      the Collateral without giving any warranties as to the
      Collateral.  Bank may specifically disclaim any warranties of
      title or the like.  This procedure will not be considered
      adversely to affect the commercial reasonableness of any sale of the
      Collateral.  If Bank sells any of the Collateral upon credit,
      Borrower will be credited only with payments actually made by the
      purchaser, received by Bank, and applied to the indebtedness of the
      purchaser.  If the purchaser fails to pay for the Collateral,
      Bank may resell the Collateral and Borrower shall be credited with the
      proceeds of the sale;

            

    

     

    
      	
               
      

            	
              (i)

            	
              Bank
      may credit bid and purchase at any public
sale;

            

    

     

    

    
      
        
           

        

        
          14

          
            

          

        

        
           

        

      

    

    

    

    
      	
               
      

            	
              (j)

            	
              Apply
      for the appointment of a receiver, trustee, liquidator or conservator of
      the Collateral, without notice and without regard to the adequacy of the
      security for the Obligations and without regard to the solvency of
      Borrower, any guarantor or any other Person liable for any of the
      Obligations; and

            

    

     

    
      	
               
      

            	
              (k)

            	
              Any
      deficiency that exists after disposition of the Collateral as provided
      above will be paid immediately by
Borrower.

            

    

     

    Bank may
comply with any applicable state or federal law requirements in connection with
a disposition of the Collateral and compliance will not be considered adversely
to affect the commercial reasonableness of any sale of the
Collateral.

     

    
      	
               
      

            	
              9.2

            	
              Power
      of Attorney.  Effective only upon the occurrence and during the
      continuance of an Event of Default, Borrower hereby irrevocably appoints
      Bank (and any of Bank’s designated officers, or employees) as Borrower’s
      true and lawful attorney to:  (a) send requests for verification
      of Accounts or notify account debtors of Bank’s security interest in the
      Accounts; (b) endorse Borrower’s name on any checks or other forms of
      payment or security that may come into Bank’s possession; (c) sign
      Borrower’s name on any invoice or bill of lading relating to any Account,
      drafts against account debtors, schedules and assignments of Accounts,
      verifications of Accounts, and notices to account debtors; (d) dispose of
      any Collateral; (e) make, settle, and adjust all claims under and
      decisions with respect to Borrower’s policies of insurance; (f) settle and
      adjust disputes and claims respecting the accounts directly with account
      debtors, for amounts and upon terms which Bank determines to be
      reasonable; (g) file, in its sole discretion, one or more financing or
      continuation statements and amendments thereto, relative to any of the
      Collateral without the signature of Borrower where permitted by law;
      provided Bank may exercise such power of attorney to sign the name of
      Borrower on any of the documents described in clause (g) above, regardless
      of whether an Event of Default has occurred.  The appointment of
      Bank as Borrower’s attorney in fact, and each and every one of Bank’s
      rights and powers, being coupled with an interest, is irrevocable until
      all of the Obligations have been fully repaid and performed and Bank’s
      obligation to provide advances hereunder is
  terminated.

            

    

     

    
      	
               
      

            	
              9.3

            	
              Accounts
      Collection.  At any time after the occurrence and during the
      continuation of an Event of Default, Bank may notify any Person owing
      funds to Borrower of Bank’s security interest in such funds and verify the
      amount of such Account.  Borrower shall collect all amounts
      owing to Borrower for Bank, receive in trust all payments as Bank’s
      trustee, and immediately deliver such payments to Bank in their original
      form as received from the account debtor, with proper endorsements for
      deposit.

            

    

     

    
      	
               
      

            	
              9.4

            	
              Bank
      Expenses.  If Borrower fails to pay any amounts or furnish any
      required proof of payment due to third persons or entities, as required
      under the terms of this Agreement, then Bank may do any or all of the
      following after reasonable notice to Borrower:  (a) make payment
      of the same or any part thereof; (b) set up such reserves under the
      Revolving Line as Bank deems necessary to protect Bank from the exposure
      created by such failure; or (c) obtain and maintain insurance policies of
      the type discussed in Section 6.5 of this Agreement, and take any action
      with respect to such policies as Bank deems prudent.  Any
      amounts so paid or deposited by Bank shall constitute Bank Expenses, shall
      be immediately due and payable, and shall bear interest at the then
      applicable rate hereinabove provided, and shall be secured by the
      Collateral.  Any payments made by Bank shall not constitute an
      agreement by Bank to make similar payments in the future or a waiver by
      Bank of any Event of Default under this
  Agreement.

            

    

     

    
      	
               
      

            	
              9.5

            	
              Bank’s
      Liability for Collateral.  Bank has no obligation to clean up or
      otherwise prepare the Collateral for sale.  All risk of loss,
      damage or destruction of the Collateral shall be borne by
      Borrower.

            

    

     

    
      	
               
      

            	
              9.6

            	
              No
      Obligation to Pursue Others.  Bank has no obligation to attempt
      to satisfy the Obligations by collecting them from any other person liable
      for them and Bank may release, modify or waive
  any

            

    

     

    

    
      
        
           

        

        
          15

          
            

          

        

        
           

        

      

    

    

    collateral
provided by any other Person to secure any of the Obligations, all without
affecting Bank’s rights against Borrower.  Borrower waives any right
it may have to require Bank to pursue any other Person for any of the
Obligations.

     

    
      	
               
      

            	
              9.7

            	
              Remedies
      Cumulative.  Bank’s rights and remedies under this Agreement,
      the Loan Documents, and all other agreements shall be
      cumulative.  Bank shall have all other rights and remedies not
      inconsistent herewith as provided under the Code, by law, or in
      equity.  No exercise by Bank of one right or remedy shall be
      deemed an election, and no waiver by Bank of any Event of Default on
      Borrower’s part shall be deemed a continuing waiver.  No delay
      by Bank shall constitute a waiver, election, or acquiescence by
      it.  No waiver by Bank shall be effective unless made in a
      written document signed on behalf of Bank and then shall be effective only
      in the specific instance and for the specific purpose for which it was
      given.  Borrower expressly agrees that this Section 9.7 may not
      be waived or modified by Bank by course of performance, conduct, estoppel
      or otherwise.

            

    

     

    
      	
               
      

            	
              9.8

            	
              Demand;
      Protest.  Except as otherwise provided in this Agreement,
      Borrower waives demand, protest, notice of protest, notice of default or
      dishonor, notice of payment and nonpayment and any other notices relating
      to the Obligations.

            

    

     

    
      	
              10.

            	
              NOTICES.

            

    

     

    Unless
otherwise provided in this Agreement, all notices or demands by any party
relating to this Agreement or any other agreement entered into in connection
herewith shall be in writing and (except for financial statements and other
informational documents which may be sent by first-class mail, postage prepaid)
shall be personally delivered or sent by a recognized overnight delivery
service, certified mail, postage prepaid, return receipt requested, or by
telefacsimile to Borrower or to Bank, as the case may be, at its addresses set
forth below:

     

    
      
        	 
      	
                If
      to Borrower:

              	
                Proxim
      Wireless Corporation

              
	 
      	 
      	
                2115
      O’Nel Drive

              
	 
      	 
      	
                San
      Jose, CA 95131

              
	 
      	 
      	
                Attn:
      Chief Financial Officer

              
	 
      	 
      	
                FAX:  (408)
      392-4262

              
	 
      	 
      	 
      
	 
      	
                with
      a copy to:

              	
                Proxim
      Wireless Corporation

              
	 
      	 
      	
                881
      North King Street, Suite 100

              
	 
      	 
      	
                Northampton,
      MA 01060

              
	 
      	 
      	
                Attn:
      David L. Renauld

              
	 
      	 
      	
                FAX:
      (413) 584-2685

              
	 
      	 
      	 
      
	 
      	
                If
      to Bank:

              	
                Comerica
      Bank

              
	 
      	 
      	
                M/C
      4770

              
	 
      	 
      	
                75
      E Trimble Road

              
	 
      	 
      	
                San
      Jose, CA 95131

              
	 
      	 
      	
                Attn:  Manager

              
	 
      	 
      	
                FAX:  (408)
      556-5091

              
	 
      	 
      	 
      
	 
      	
                with
      a copy to:

              	
                Comerica
      Bank

              
	 
      	 
      	
                226
      Airport Parkway, Suite 100

              
	 
      	 
      	
                San
      Jose, CA 95110

              
	 
      	 
      	
                Attn:  Guy
      Simpson

              
	 
      	 
      	
                FAX:  (408)
      451-8568

              

      

        

    

    The
parties hereto may change the address at which they are to receive notices
hereunder, by notice in writing in the foregoing manner given to the
other.

     

    

    
      
        
           

        

        
          16

          
            

          

        

        
           

        

      

    

    

    

     

    
      	
              11.

            	
              CHOICE OF LAW AND
      VENUE: JURY TRIAL WAIVER.

            

    

     

    This
Agreement shall be governed by, and construed in accordance with, the internal
laws of the State of California, without regard to principles of conflicts of
law. Each of Borrower and Bank hereby submits to the exclusive jurisdiction of
the state and Federal courts located in the County of Santa Clara, State of
California. THE UNDERSIGNED ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY IS A
CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED UNDER CERTAIN CIRCUMSTANCES. TO
THE EXTENT PERMITTED BY LAW, EACH PARTY, AFTER CONSULTING (OR HAVING HAD THE
OPPORTUNITY TO CONSULT) WITH COUNSEL OF ITS CHOICE, KNOWINGLY AND VOLUNTARILY,
AND FOR THE MUTUAL BENEFIT OF ALL PARTIES, WAIVES ANY RIGHT TO TRIAL BY JURY IN
THE EVENT OF LITIGATION ARISING OUT OF OR RELATED TO THIS AGREEMENT OR ANY OTHER
DOCUMENT, INSTRUMENT OR AGREEMENT BETWEEN THE UNDERSIGNED PARTIES.

     

    
      	
              12.

            	
              JUDICIAL REFERENCE
      PROVISION.

            

    

     

    
      	
               
      

            	
              (a)

            	
              In
      the event the Jury Trial Waiver set forth above is not enforceable, the
      parties elect to proceed under this Judicial Reference
      Provision.

            

    

     

    
      	
               
      

            	
              (b)

            	
              With
      the exception of the items specified in clause (c), below, any
      controversy, dispute or claim (each, a “Claim”) between the parties
      arising out of or relating to this Agreement or any other document,
      instrument or agreement between the undersigned parties (collectively in
      this Section, the “Comerica Documents), will be resolved by a reference
      proceeding in California in accordance with the provisions of Sections 638
      et seq. of the California Code of Civil Procedure (“CCP”), or their
      successor sections, which shall constitute the exclusive remedy for the
      resolution of any Claim, including whether the Claim is subject to the
      reference proceeding. Except as otherwise provided in the Comerica
      Documents, venue for the reference proceeding will be in the state or
      federal court in the county or district where the real property involved
      in the action, if any, is located or in the state or federal court in the
      county or district where venue is otherwise appropriate under applicable
      law (the “Court”).

            

    

     

    
      	
               
      

            	
              (c)

            	
              The
      matters that shall not be subject to a reference are the following: (i)
      nonjudicial foreclosure of any security interests in real or personal
      property, (ii) exercise of self-help remedies (including, without
      limitation, set-off), (iii) appointment of a receiver and (iv) temporary,
      provisional or ancillary remedies (including, without limitation, writs of
      attachment, writs of possession, temporary restraining orders or
      preliminary injunctions). This reference provision does not limit the
      right of any party to exercise or oppose any of the rights and remedies
      described in clauses (i) and (ii) or to seek or oppose from a court of
      competent jurisdiction any of the items described in clauses (iii) and
      (iv). The exercise of, or opposition to, any of those items does not waive
      the right of any party to a reference pursuant to this reference provision
      as provided herein.

            

    

     

    
      	
               
      

            	
              (d)

            	
              The
      referee shall be a retired judge or justice selected by mutual written
      agreement of the parties. If the parties do not agree within ten (10) days
      of a written request to do so by any party, then, upon request of any
      party, the referee shall be selected by the Presiding Judge of the Court
      (or his or her representative). A request for appointment of a referee may
      be heard on an ex parte or expedited basis, and the parties agree that
      irreparable harm would result if ex parte relief is not granted. Pursuant
      to CCP § 170.6, each party shall have one peremptory challenge to the
      referee selected by the Presiding Judge of the Court (or his or her
      representative).

            

    

     

    
      	
               
      

            	
              (e)

            	
              The
      parties agree that time is of the essence in conducting the reference
      proceedings. Accordingly, the referee shall be requested, subject to
      change in the time periods specified herein for good cause shown, to (i)
      set the matter for a status and trial-setting conference within fifteen
      (15) days after the date of selection of the referee, (ii) if practicable,
      try all issues of law or fact within one hundred twenty (120) days after
      the

            

    

     

    

    
      
        
           

        

        
          17

          
            

          

        

        
           

        

      

    

    

    date of
the conference and (iii) report a statement of decision within twenty (20) days
after the matter has been submitted for decision.

     

    
      	
               
      

            	
              (f)

            	
              The
      referee will have power to expand or limit the amount and duration of
      discovery. The referee may set or extend discovery deadlines or cutoffs
      for good cause, including a party’s failure to provide requested discovery
      for any reason whatsoever. Unless otherwise ordered based upon good cause
      shown, no party shall be entitled to “priority” in conducting discovery,
      depositions may be taken by either party upon seven (7) days written
      notice, and all other discovery shall be responded to within fifteen (15)
      days after service. All disputes relating to discovery which cannot be
      resolved by the parties shall be submitted to the referee whose decision
      shall be final and binding.

            

    

     

    
      	
               
      

            	
              (g)

            	
              Except
      as expressly set forth herein, the referee shall determine the manner in
      which the reference proceeding is conducted including the time and place
      of hearings, the order of presentation of evidence, and all other
      questions that arise with respect to the course of the reference
      proceeding. All proceedings and hearings conducted before the referee,
      except for trial, shall be conducted without a court reporter, except that
      when any party so requests, a court reporter will be used at any hearing
      conducted before the referee, and the referee will be provided a courtesy
      copy of the transcript. The party making such a request shall have the
      obligation to arrange for and pay the court reporter. Subject to the
      referee’s power to award costs to the prevailing party, the parties will
      equally share the cost of the referee and the court reporter at
      trial.

            

    

     

    
      	
               
      

            	
              (h)

            	
              The
      referee shall be required to determine all issues in accordance with
      existing case law and the statutory laws of the State of California. The
      rules of evidence applicable to proceedings at law in the State of
      California will be applicable to the reference proceeding. The referee
      shall be empowered to enter equitable as well as legal relief, enter
      equitable orders that will be binding on the parties and rule on any
      motion which would be authorized in a court proceeding, including without
      limitation motions for summary judgment or summary adjudication. The
      referee shall issue a decision at the close of the reference proceeding
      which disposes of all claims of the parties that are the subject of the
      reference. Pursuant to CCP § 644, such decision shall be entered by the
      Court as a judgment or an order in the same manner as if the action had
      been tried by the Court and any such decision will be final, binding and
      conclusive. The parties reserve the right to appeal from the final
      judgment or order or from any appealable decision or order entered by the
      referee. The parties reserve the right to findings of fact, conclusions of
      laws, a written statement of decision, and the right to move for a new
      trial or a different judgment, which new trial, if granted, is also to be
      a reference proceeding under this
provision.

            

    

     

    
      	
               
      

            	
              (i)

            	
              If
      the enabling legislation which provides for appointment of a referee is
      repealed (and no successor statute is enacted), any dispute between the
      parties that would otherwise be determined by reference procedure will be
      resolved and determined by arbitration. The arbitration will be conducted
      by a retired judge or justice, in accordance with the California
      Arbitration Act § 1280 through § 1294.2 of the CCP as amended from time to
      time. The limitations with respect to discovery set forth above shall
      apply to any such arbitration
proceeding.

            

    

     

    
      	
               
      

            	
              (j)

            	
              THE
      PARTIES RECOGNIZE AND AGREE THAT ALL CONTROVERSIES, DISPUTES AND CLAIMS
      RESOLVED UNDER THIS REFERENCE PROVISION WILL BE DECIDED BY A REFEREE AND
      NOT BY A JURY. AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT)
      WITH COUNSEL OF ITS OWN CHOICE, EACH PARTY KNOWINGLY AND VOLUNTARILY, AND
      FOR THE MUTUAL BENEFIT OF ALL PARTIES, AGREES THAT THIS REFERENCE
      PROVISION WILL APPLY TO ANY CONTROVERSY, DISPUTE OR CLAIM BETWEEN OR AMONG
      THEM ARISING OUT OF OR IN

            

    

     

    

    
      
        
           

        

        
          18

          
            

          

        

        
           

        

      

    

    

    ANY WAY
RELATED TO, THIS AGREEMENT OR THE OTHER COMERICA DOCUMENTS.

     

    
      	
              13.

            	
              GENERAL
      PROVISIONS.

            

    

     

    
      	
               
      

            	
              13.1

            	
              Successors
      and Assigns.  This Agreement shall bind and inure to the benefit
      of the respective successors and permitted assigns of each of the parties
      and shall bind all persons who become bound as a debtor to this Agreement;
      provided, however, that neither this Agreement nor any rights hereunder
      may be assigned by Borrower without Bank’s prior written consent, which
      consent may be granted or withheld in Bank’s sole
      discretion.  Bank shall have the right without the consent of or
      notice to Borrower to sell, transfer, negotiate, or grant participation in
      all or any part of, or any interest in, Bank’s obligations, rights and
      benefits hereunder.

            

    

     

    
      	
               
      

            	
              13.2

            	
              Indemnification.  Borrower
      shall defend, indemnify and hold harmless Bank and its officers,
      employees, and agents against:  (a) all obligations, demands,
      claims, and liabilities claimed or asserted by any other party in
      connection with the transactions contemplated by this Agreement; and (b)
      all losses or Bank Expenses in any way suffered, incurred, or paid by
      Bank, its officers, employees and agents as a result of or in any way
      arising out of, following, or consequential to transactions between Bank
      and Borrower whether under this Agreement, or otherwise (including without
      limitation reasonable attorneys fees and expenses), except for losses
      caused by Bank’s gross negligence or willful
  misconduct.

            

    

     

    
      	
               
      

            	
              13.3

            	
              Time
      of Essence.  Time is of the essence for the performance of all
      obligations set forth in this
Agreement.

            

    

     

    
      	
               
      

            	
              13.4

            	
              Severability
      of Provisions.  Each provision of this Agreement shall be
      severable from every other provision of this Agreement for the purpose of
      determining the legal enforceability of any specific
      provision.

            

    

     

    
      	
               
      

            	
              13.5

            	
              Amendments
      in Writing, Integration. All amendments to or terminations of this
      Agreement or the other Loan Documents must be in writing.  All
      prior agreements, understandings, representations, warranties, and
      negotiations between the parties hereto with respect to the subject matter
      of this Agreement and the other Loan Documents, if any, are merged into
      this Agreement and the Loan
Documents.

            

    

     

    
      	
               
      

            	
              13.6

            	
              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, shall be deemed to be an original, and all of which, when taken
      together, shall constitute but one and the same
  Agreement.

            

    

     

    
      	
               
      

            	
              13.7

            	
              Survival.  All
      covenants, representations and warranties made in this Agreement shall
      continue in full force and effect so long as any Obligations remain
      outstanding or Bank has any obligation to make any Credit Extension to
      Borrower.  The obligations of Borrower to indemnify Bank with
      respect to the expenses, damages, losses, costs and liabilities described
      in Section 13.2 shall survive until all applicable statute of limitations
      periods with respect to actions that may be brought against Bank have
      run.

            

    

     

    
      	
               
      

            	
              13.8

            	
              Confidentiality.  In
      handling any confidential information, Bank and all employees and agents
      of Bank shall exercise the same degree of care that Bank exercises with
      respect to its own proprietary information of the same types to maintain
      the confidentiality of any non-public information thereby received or
      received pursuant to this Agreement except that disclosure of such
      information may be made (i) to the subsidiaries or Affiliates of Bank in
      connection with their present or prospective business relations with
      Borrower, (ii) to prospective transferees or purchasers of any interest in
      the Loans, provided that they have entered into a comparable
      confidentiality agreement in favor of Borrower and have delivered a copy
      to Borrower, (iii) as required by law,
  regulations,

            

    

     

    

    
      
        
           

        

        
          19

          
            

          

        

        
           

        

      

    

    

    rule or
order, subpoena, judicial order or similar order, (iv) as may be required in
connection with the examination, audit or similar investigation of Bank and (v)
as Bank may determine in connection with the enforcement of any remedies
hereunder.  Confidential information hereunder shall not include
information that either:  (a) is in the public domain or in the
knowledge or possession of Bank when disclosed to Bank, or becomes part of the
public domain after disclosure to Bank through no fault of Bank; or (b) is
disclosed to Bank by a third party, provided Bank does not have actual knowledge
that such third party is prohibited from disclosing such
information.

     

    

     

    

    [Remainder
of Page Intentionally Left Blank]

    

    
      
        
           

        

        
          20

          
            

          

        

        
           

        

      

    

    

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

     

    
      	 
      	
              PROXIM
      WIRELESS CORPORATION

            
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	
              By:  /s/ Pankaj S.
      Manglik

            
	 
      	 
      
	 
      	
              Name:  Pankaj
      S. Manglik

            
	 
      	 
      
	 
      	
              Title:  President
      and Chief Executive Officer

            
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	
              COMERICA
      BANK

            
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	
              By:
      /s/ Guy
      Simpson

            
	 
      	 
      
	 
      	
              Name:  Guy
      Simpson

            
	 
      	 
      
	 
      	
              Title:  Vice
      President

            

    

    

    

    
      
        
           

        

        
          21

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
A

     

    DEFINITIONS

    

    “Accounts”
means all presently existing and hereafter arising accounts, contract rights,
payment intangibles and all other forms of obligations owing to Borrower arising
out of the sale or lease of goods (including, without limitation, the licensing
of software and other technology) or the rendering of services by Borrower and
any and all credit insurance, guaranties, and other security therefor, as well
as all merchandise returned to or reclaimed by Borrower and Borrower’s Books
relating to any of the foregoing.

     

     “Advance”
or “Advances” means a cash advance or cash advances under the Revolving
Line.

     

    “Affiliate”
means, with respect to any Person, any Person that owns or controls directly or
indirectly such Person, any Person that controls or is controlled by or is under
common control with such Person, and each of such Person’s senior executive
officers, directors, and partners.

     

     “Bank
Expenses” means all reasonable costs or expenses (including reasonable
attorneys’ fees and expenses, whether generated in-house or by outside counsel)
incurred in connection with the preparation, negotiation, administration, and
enforcement of the Loan Documents;  reasonable Collateral audit fees;
and Bank’s reasonable attorneys’ fees and expenses (whether generated in-house
or by outside counsel) incurred in amending, enforcing or defending the Loan
Documents (including fees and expenses of appeal), incurred before, during and
after an Insolvency Proceeding, whether or not suit is brought.

     

    “Borrower
State” means Delaware, the state under whose laws Borrower is
organized.

     

    “Borrower’s
Books” means all of Borrower’s books and records including:  ledgers;
records concerning Borrower’s assets or liabilities, the Collateral, business
operations or financial condition; and all computer programs, or tape files, and
the equipment, containing such information.

     

    “Borrowing
Base” means an amount equal to 80% (“Advance Percentage”) of Eligible Accounts,
which Advance Percentage may be adjusted up or down based on Bank’s receipt and
review of an audit of Accounts, as determined by Bank with reference to the most
recent Borrowing Base Certificate delivered by Borrower.

     

    “Business
Day” means any day that is not a Saturday, Sunday, or other day on which banks
in the State of California are authorized or required to close.

     

     “Cash”
means unrestricted cash and cash equivalents.

     

     “Change
in Control” shall mean a transaction in which any “person” or “group” (within
the meaning of Section 13(d) and 14(d)(2) of the Securities Exchange Act of
1934) becomes the “beneficial owner” (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934), directly or indirectly, of a sufficient number
of shares of all classes of stock then outstanding of Borrower ordinarily
entitled to vote in the election of directors, empowering such “person” or
“group” to elect a majority of the Board of Directors of Borrower, who did not
have such power before such transaction.

     

    “Chief
Executive Office State” means California, where Borrower’s chief executive
office is located.

     

    “Closing
Date” means the date of this Agreement.

     

    “Code”
means the California Uniform Commercial Code as amended or supplemented from
time to time.

     

    “Collateral”
means the property described on Exhibit B attached hereto and all Negotiable
Collateral to the extent not described on Exhibit B, except to the extent any
such property (i) is nonassignable by its terms without the consent of the
licensor thereof or another party (but only to the extent such prohibition on
transfer is enforceable under applicable law, including, without limitation,
Sections 9406 and 9408 of the Code), (ii) the granting of a

     

    

    
      
        
           

        

        
          Exhibit A
- Page 1

          
            

          

        

        
           

        

      

    

    

    security
interest therein is contrary to applicable law, provided that upon the cessation
of any such restriction or prohibition, such property shall automatically become
part of the Collateral, or (iii) constitutes the capital stock of a controlled
foreign corporation (as defined in the IRC), in excess of 65% of the voting
power of all classes of capital stock of such controlled foreign corporations
entitled to vote.

     

    “Collateral
State” means the states or countries where the Collateral is located, which are
California, Hong Kong , India, Massachusetts, and the Netherlands.

     

     “Contingent
Obligation” means, as applied to any Person, any direct or indirect liability,
contingent or otherwise, of that Person with respect to (i) any indebtedness,
lease, dividend, letter of credit or other obligation of another, including,
without limitation, any such obligation directly or indirectly guaranteed,
endorsed, co-made or discounted or sold with recourse by that Person, or in
respect of which that Person is otherwise directly or indirectly liable; (ii)
any obligations with respect to undrawn letters of credit, corporate credit
cards or merchant services issued for the account of that Person; and (iii) all
obligations arising under any interest rate, currency or commodity swap
agreement, interest rate cap agreement, interest rate collar agreement, or other
agreement or arrangement designated to protect a Person against fluctuation in
interest rates, currency exchange rates or commodity prices; provided, however,
that the term “Contingent Obligation” shall not include endorsements for
collection or deposit in the ordinary course of business.  The amount
of any Contingent Obligation shall be deemed to be an amount equal to the stated
or determined amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by such Person
in good faith; provided, however, that such amount shall not in any event exceed
the maximum amount of the obligations under the guarantee or other support
arrangement.

     

    “Copyrights”
means 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, now or hereafter existing, created, acquired or
held.

     

    “Credit
Card Services Sublimit” means a sublimit for corporate credit cards and
e-commerce or merchant account services under the Revolving Line not to exceed
$120,000.

     

     “Credit
Extension” means each Advance or any other extension of credit by Bank to or for
the benefit of Borrower hereunder.

     

     “Current
Liabilities” means, as of any applicable date, all amounts that should, in
accordance with GAAP, be included as current liabilities on the consolidated
balance sheet of Borrower and its Subsidiaries, as at such date, plus, to the
extent not already included therein, undrawn Letters of Credit and Borrower’s
maximum potential obligations under the Credit Card Services Sublimit and
Foreign Exchange Sublimit, if any, but specifically excluding any cash-secured
Obligations.

     

     “Deferred
Revenue” means all amounts received in advance of performance and not yet
recognized as revenue.

     

     “Eligible
Accounts” means those Accounts that arise in the ordinary course of Borrower’s
business that comply with all of Borrower’s representations and warranties to
Bank set forth in Section 5.3; provided, that Bank may change the standards of
eligibility by giving Borrower 30 days prior written notice.  Unless
otherwise agreed to by Bank, Eligible Accounts shall not include the
following:

     

    
      	
               
      

            	
              (a)

            	
              Accounts
      that the account debtor has failed to pay in full within 90 days of
      invoice date;

            

    

     

    
      	
               
      

            	
              (b)

            	
              Credit
      balances over 90 days;

            

    

     

    
      	
               
      

            	
              (c)

            	
              Accounts
      with respect to an account debtor, 25% of whose Accounts the account
      debtor has failed to pay within 90 days of invoice
  date;

            

    

     

    
      	
               
      

            	
              (d)

            	
              Accounts
      with respect to an account debtor, including Subsidiaries and Affiliates,
      whose total obligations to Borrower exceed 20% of all Accounts
      (“Concentration Limit”), to the

            

    

     

    

    
      
        
           

        

        
          Exhibit A
- Page 2

          
            

          

        

        
           

        

      

    

    

    extent
such obligations exceed the aforementioned percentage, except as approved in
writing by Bank. Notwithstanding the foregoing, the Concentration Limit with
respect to Accounts where the account debtor is Tech Data, Hutton Communications
or Winncomm Technologies shall be 25%;

     

    
      	
               
      

            	
              (e)

            	
              Accounts
      with respect to which the account debtor does not have its principal place
      of business in the United States, except for Eligible Foreign
      Accounts;

            

    

     

    
      	
               
      

            	
              (f)

            	
              Accounts
      with respect to which the account debtor is the United States or any
      department, agency, or instrumentality of the United States, except for
      Accounts of the United States if the payee has assigned its payment rights
      to Bank and the assignment has been acknowledged under the Assignment of
      Claims Act of 1940 (31 U.S.C.
3727);

            

    

     

    
      	
               
      

            	
              (g)

            	
              Accounts
      with respect to which Borrower is liable to the account debtor for goods
      sold or services rendered by the account debtor to Borrower, but only to
      the extent of any amounts owing to the account debtor against amounts owed
      to Borrower;

            

    

     

    
      	
               
      

            	
              (h)

            	
              Accounts
      with respect to which goods are placed on consignment, guaranteed sale,
      sale or return, sale on approval, bill and hold, demo or promotional, or
      other terms by reason of which the payment by the account debtor may be
      conditional;

            

    

     

    
      	
               
      

            	
              (i)

            	
              Accounts
      with respect to which the account debtor is an officer, employee, agent or
      Affiliate of Borrower;

            

    

     

    
      	
               
      

            	
              (j)

            	
              Accounts
      that have not yet been billed to the account debtor or that relate to
      deposits (such as good faith deposits) or other property of the account
      debtor held by Borrower for the performance of services or delivery of
      goods which Borrower has not yet performed or
  delivered;

            

    

     

    
      	
               
      

            	
              (k)

            	
              Accounts
      with respect to which the account debtor disputes liability or makes any
      claim with respect thereto as to which Bank believes, in its sole
      discretion, that there may be a basis for dispute (but only to the extent
      of the amount subject to such dispute or claim), or is subject to any
      Insolvency Proceeding, or becomes insolvent, or goes out of
      business;

            

    

     

    
      	
               
      

            	
              (l)

            	
              Accounts
      the collection of which Bank reasonably determines after inquiry and
      consultation with Borrower to be doubtful;
and

            

    

     

    
      	
               
      

            	
              (m)

            	
              Retentions
      and hold-backs.

            

    

     

    “Eligible
Foreign Account” means an Account which meets all of the requirements to be an
Eligible Account except with respect to which the account debtor does not have
its principal place of business in the United States and that is (i) supported
by one or more letters of credit in an amount and of a tenor, and issued by a
financial institution, acceptable to Bank, (ii) insured by an insurance company
acceptable to Bank, (iii) generated by an account debtor with its principal
place of business in Canada, provided that the Bank has perfected its security
interest in the appropriate Canadian province, or (iv) approved by Bank on a
case-by-case basis.  All Eligible Foreign Accounts must be calculated
in U.S. Dollars.

     

    “Environmental
Laws” means all laws, rules, regulations, orders and the like issued by any
federal state, local foreign or other governmental or quasi-governmental
authority or any agency pertaining to the environment or to any hazardous
materials or wastes, toxic substances, flammable, explosive or radioactive
materials, asbestos or other similar materials.

     

    “Equipment”
means all present and future machinery, equipment, tenant improvements,
furniture, fixtures, vehicles, tools, parts and attachments in which Borrower
has any interest.

     

    

    
      
        
           

        

        
          Exhibit A
- Page 3

          
            

          

        

        
           

        

      

    

    

    

     

     “ERISA”
means the Employee Retirement Income Security Act of 1974, as amended, and the
regulations thereunder.

     

    “Event of
Default” has the meaning assigned in Article 8.

     

    “Foreign Exchange Sublimit” means a
sublimit for foreign exchange contracts under the Revolving Line not to exceed
$250,000.

     

    “GAAP”
means generally accepted accounting principles, consistently applied, as in
effect from time to time.

     

    “Indebtedness”
means (a) all indebtedness for borrowed money or the deferred purchase price of
property or services, including without limitation reimbursement and other
obligations with respect to surety bonds and letters of credit, (b) all
obligations evidenced by notes, bonds, debentures or similar instruments, (c)
all capital lease obligations, (d) all Contingent Obligations, and (e) all
obligations arising under the Credit Card Services Sublimit and Foreign Exchange
Sublimit.

     

    “Insolvency
Proceeding” means any proceeding commenced by or against any Person or entity
under any provision of the United States Bankruptcy Code, as amended, or under
any other bankruptcy or insolvency law, including assignments for the benefit of
creditors, formal or informal moratoria, compositions, extension 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)

            	
              Copyrights,
      Trademarks and Patents;

            

    

     

    
      	
               
      

            	
              (b)

            	
              Any
      and all trade secrets, and any and all intellectual property rights in
      computer software and computer software products now or hereafter
      existing, created, acquired or
held;

            

    

     

    
      	
               
      

            	
              (c)

            	
              Any
      and all design rights which may be available to Borrower now or hereafter
      existing, created, acquired or
held;

            

    

     

    
      	
               
      

            	
              (d)

            	
              Any
      and all claims for damages by way of past, present and future infringement
      of any of the rights included above, 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;

            

    

     

    
      	
               
      

            	
              (e)

            	
              All
      licenses or other rights to use any of the Copyrights, Patents or
      Trademarks, and all license fees and royalties arising from such use to
      the extent permitted by such license or rights;
  and

            

    

     

    
      	
               
      

            	
              (f)

            	
              All
      amendments, renewals and extensions of any of the Copyrights, Trademarks
      or Patents.

            

    

     

    “Inventory”
means all present and future inventory in which Borrower has any
interest.

     

    “Investment”
means any beneficial ownership of (including stock, partnership or limited
liability company interest or other securities) any Person, or any loan, advance
or capital contribution to any Person.

     

    “IRC”
means the Internal Revenue Code of 1986, as amended, and the regulations
thereunder.

     

    “Letter
of Credit” means a commercial or standby letter of credit or similar undertaking
issued by Bank at Borrower’s request in accordance with Section
2.1(b)(iii).

     

    

     

    

    
      
        
           

        

        
          Exhibit A
- Page 4

          
            

          

        

        
           

        

      

    

    

    

     

    “Letter
of Credit Sublimit” means a sublimit for Letters of Credit under the Revolving
Line not to exceed $250,000.

     

     “Lien”
means any mortgage, lien, deed of trust, charge, pledge, security interest or
other encumbrance.

     

     “Loan
Documents” means, collectively, this Agreement, any note or notes executed by
Borrower, and any other document, instrument or agreement entered into in
connection with this Agreement, all as amended or extended from time to
time.

     

    “Material
Adverse Effect” means a material adverse effect on (i) the business operations,
condition (financial or otherwise) or prospects of Borrower and its Subsidiaries
taken as a whole, (ii) the ability of Borrower to repay the Obligations or
otherwise perform its obligations under the Loan Documents, or (iii) Borrower’s
interest in, or the value (taken as a whole), perfection or priority of Bank’s
security interest in the Collateral (except as provided in the
Schedule).

     

    “Negotiable
Collateral” means all of Borrower’s present and future letters of credit of
which it is a beneficiary, drafts, instruments (including promissory notes),
securities, documents of title, and chattel paper, and Borrower’s Books relating
to any of the foregoing.

     

    “Non-Formula
Amount” has the meaning assigned in Section 2.1(b)(i).

     

     “Obligations”
means all debt, principal, interest, Bank Expenses and other amounts owed to
Bank by Borrower pursuant to this Agreement or any other agreement, whether
absolute or contingent, due or to become due, now existing or hereafter arising,
including any interest that accrues after the commencement of an Insolvency
Proceeding and including any debt, liability, or obligation owing from Borrower
to others that Bank may have obtained by assignment or otherwise.

     

    “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.

     

    “Periodic
Payments” means all installments or similar recurring payments that Borrower may
now or hereafter become obligated to pay to Bank pursuant to the terms and
provisions of any instrument, or agreement now or hereafter in existence between
Borrower and Bank.

     

    “Permitted
Indebtedness” means:

     

    
      	
               
      

            	
              (a)

            	
              Indebtedness
      of Borrower in favor of Bank arising under this Agreement or any other
      Loan Document;

            

    

     

    
      	
               
      

            	
              (b)

            	
              Indebtedness
      existing on the Closing Date and disclosed in the
  Schedule;

            

    

     

    
      	
               
      

            	
              (c)

            	
              Indebtedness
      not to exceed $250,000 in the aggregate in any fiscal year of Borrower
      secured by a lien described in clause (c) of the defined term “Permitted
      Liens,” provided such Indebtedness does not exceed the lesser of the cost
      or fair market value of the equipment financed with such
      Indebtedness;

            

    

     

    
      	
               
      

            	
              (d)

            	
              Subordinated
      Debt;

            

    

     

    
      	
               
      

            	
              (e)

            	
              Indebtedness
      to trade creditors incurred in the ordinary course of business;
      and

            

    

     

    
      	
               
      

            	
              (f)

            	
              Extensions,
      refinancings and renewals of any items of Permitted Indebtedness, provided
      that the principal amount is not increased or the terms modified to impose
      more burdensome terms upon Borrower or its Subsidiary, as the case may
      be.

            

    

     

    “Permitted
Investment” means:

     

    

    
      
        
           

        

        
          Exhibit A
- Page 5

          
            

          

        

        
           

        

      

    

    

    

     

    
      	
               
      

            	
              (a)

            	
              Investments
      existing on the Closing Date disclosed in the
  Schedule;

            

    

     

    
      	
               
      

            	
              (b)

            	
              (i)
      Marketable direct obligations issued or unconditionally guaranteed by the
      United States of America or any agency or any State thereof maturing
      within one year from the date of acquisition thereof, (ii) commercial
      paper maturing no more than one year from the date of creation thereof and
      currently having rating of at least A-2 or P-2 from either Standard &
      Poor’s Corporation or Moody’s Investors Service, (iii) Bank’s certificates
      of deposit maturing no more than one year from the date of investment
      therein, and (iv) Bank’s money market
accounts;

            

    

     

    
      	
               
      

            	
              (c)

            	
              Repurchases
      of stock from former employees or directors of Borrower under the terms of
      applicable repurchase agreements (i) in an aggregate amount not to exceed
      $250,000 in any fiscal year, provided that no Event of Default has
      occurred, is continuing or would exist after giving effect to the
      repurchases, or (ii) in any amount where the consideration for the
      repurchase is the cancellation of indebtedness owed by such former
      employees to Borrower regardless of whether an Event of Default
      exists;

            

    

     

    
      	
               
      

            	
              (d)

            	
              Investments
      accepted in connection with Permitted
Transfers;

            

    

     

    
      	
               
      

            	
              (e)

            	
              Investments
      of Subsidiaries in or to other Subsidiaries or Borrower and Investments by
      Borrower in Subsidiaries not to exceed $250,000 in the aggregate in any
      fiscal year;

            

    

     

    
      	
               
      

            	
              (f)

            	
              Investments
      not to exceed $250,000 in the aggregate in any fiscal year 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 plan agreements approved by Borrower’s Board of
      Directors;

            

    

     

    
      	
               
      

            	
              (g)

            	
              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 Borrower’s
business;

            

    

     

    
      	
               
      

            	
              (h)

            	
              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 subparagraph (h) shall not
      apply to Investments of Borrower in any Subsidiary;
  and

            

    

     

    
      	
               
      

            	
              (i)

            	
              Joint
      ventures or strategic alliances in the ordinary course of Borrower’s
      business consisting of the non-exclusive licensing of technology, the
      development of technology or the providing of technical support, provided
      that any cash Investments by Borrower do not exceed $250,000 in the
      aggregate in any fiscal year.

            

    

     

    “Permitted
Liens” means the following:

     

    
      	
               
      

            	
              (a)

            	
              Any
      Liens existing on the Closing Date and disclosed in the Schedule
      (excluding Liens to be satisfied with the proceeds of the Advances) or
      arising under this Agreement or the other Loan
  Documents;

            

    

     

    
      	
               
      

            	
              (b)

            	
              Liens
      for taxes, fees, assessments or other governmental charges or levies,
      either not delinquent or being contested in good faith by appropriate
      proceedings and for which Borrower maintains adequate reserves, provided
      the same have no priority over any of Bank’s security
      interests;

            

    

     

    

    
      
        
           

        

        
          Exhibit A
- Page 6

          
            

          

        

        
           

        

      

    

    

    

    
      	
               
      

            	
              (c)

            	
              Liens
      not to exceed $250,000 in the aggregate (i) upon or in any Equipment
      (other than Equipment financed by an Advance) acquired or held by Borrower
      or any of its Subsidiaries to secure the purchase price of such Equipment
      or indebtedness incurred solely for the purpose of financing the
      acquisition or lease of such Equipment, or (ii) existing on such Equipment
      at the time of its acquisition, provided that the Lien is confined solely
      to the property so acquired and improvements thereon, and the proceeds of
      such Equipment;

            

    

     

    
      	
               
      

            	
              (d)

            	
              Liens
      incurred in connection with the extension, renewal or refinancing of the
      indebtedness secured by Liens of the type described in clauses (a) through
      (c) above, provided that any extension, renewal or replacement Lien shall
      be limited to the property encumbered by the existing Lien and the
      principal amount of the indebtedness being extended, renewed or refinanced
      does not increase;

            

    

     

    
      	
               
      

            	
              (e)

            	
              Liens
      arising from judgments, decrees or attachments in circumstances not
      constituting an Event of Default under Sections 8.5 (attachment) or 8.9
      (judgments); and

            

    

     

    
      	
               
      

            	
              (f)

            	
              Liens
      in favor of other financial institutions arising in connection with
      Borrower’s deposit accounts held at such institutions to secure standard
      fees for deposit services charged by, but not financing made available by
      such institutions, provided that Bank has a perfected security interest in
      the amounts held in such deposit
accounts.

            

    

     

    “Permitted
Transfer” means the conveyance, sale, lease, transfer or disposition by Borrower
or any Subsidiary of:

     

    
      	
               
      

            	
              (a)

            	
              (i)
      Inventory in the ordinary course of business or (ii) excess or obsolete
      Inventory in an aggregate maximum amount not to exceed $250,000 in any
      fiscal year;

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      items described on the Schedule;

            

    

     

    
      	
               
      

            	
              (c)

            	
              licenses
      and similar arrangements for the use of the property of Borrower or its
      Subsidiaries in the ordinary course of
business;

            

    

     

    
      	
               
      

            	
              (d)

            	
              worn-out
      or obsolete Equipment not financed with the proceeds of Advances;
      or

            

    

     

    
      	
               
      

            	
              (e)

            	
              other
      assets of Borrower or its Subsidiaries that do not in the aggregate exceed
      $250,000 during any fiscal year.

            

    

     

    “Person”
means any individual, sole proprietorship, partnership, limited liability
company, joint venture, trust, unincorporated organization, association,
corporation, institution, public benefit corporation, firm, joint stock company,
estate, entity or governmental agency.

     

    “Prime
Rate” means the variable rate of interest, per annum, most recently announced by
Bank, as its “prime rate,” whether or not such announced rate is the lowest rate
available from Bank.

     

     “Responsible
Officer” means each of the Chief Executive Officer, the Chief Operating Officer,
the Chief Financial Officer and the Controller of Borrower.

     

    “Revolving
Line” means a Credit Extension of up to $7,500,000 (inclusive of any amounts
outstanding under the Letter of Credit Sublimit, the Credit Card Services
Sublimit and the Foreign Exchange amount).

     

    “Revolving
Maturity Date” means March 27, 2009.

     

    “Schedule”
means the schedule of exceptions attached hereto and approved by
Bank.

     

    

    
      
        
           

        

        
          Exhibit A
- Page 7

          
            

          

        

        
           

        

      

    

    

    

     

    “SOS
Reports” means the official reports from the Secretary of State of the Borrower
State and other applicable federal, state or local government offices
identifying all current security interests filed in the Collateral and Liens of
record as of the date of such report.

     

    “Subordinated
Debt” means any debt incurred by Borrower that is subordinated in writing to the
debt owing by Borrower to Bank on terms reasonably acceptable to Bank (and
identified as being such by Borrower and Bank).

     

    “Subsidiary”
means any corporation, partnership or limited liability company or joint venture
in which (i) any general partnership interest or (ii) more than 50% of the
stock, limited liability company interest or joint venture of which by the terms
thereof has the ordinary voting power to elect the Board of Directors, managers
or trustees of the entity, at the time as of which any determination is being
made, is owned by Borrower, either directly or through an
Affiliate.

     

     “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.

     

    

    
      
        
           

        

        
          Exhibit A
- Page 8

          
            

          

        

        
           

        

      

    

    

    
      
        	
                DEBTOR:

              	
                PROXIM
      WIRELESS CORPORATION

              
	 
      	 
      
	
                SECURED
      PARTY:

              	
                COMERICA
      BANK

              
	 
      	 

      

    

    EXHIBIT
B

     

    COLLATERAL
DESCRIPTION ATTACHMENT TO LOAN AND SECURITY AGREEMENT

     

    All
personal property of Debtor of every kind, whether presently existing or
hereafter created or acquired, and wherever located, including but not limited
to: (a) all accounts (including health-care-insurance receivables), chattel
paper (including tangible and electronic chattel paper), deposit accounts,
documents (including negotiable documents), equipment (including all accessions
and additions thereto), general intangibles (including payment intangibles and
software), goods (including fixtures), instruments (including promissory notes),
inventory (including all goods held for sale or lease or to be furnished under a
contract of service, and including returns and repossessions), investment
property (including securities and securities entitlements), letter of credit
rights, money, and all of Debtor's books and records with respect to any of the
foregoing, and the computers and equipment containing said books and records;
and (b) any and all cash proceeds and/or noncash proceeds thereof, including,
without limitation, insurance proceeds, and all supporting obligations and the
security therefor or for any right to payment.  All terms above have
the meanings given to them in the California Uniform Commercial Code, as amended
or supplemented from time to time.

     

    Notwithstanding
the foregoing, the Collateral shall not include any copyrights, patents,
trademarks, servicemarks and applications therefor, trade secrets, rights in
computer software or computer software products, design rights, licenses or
other rights relating to the foregoing intellectual property rights, now owned
or hereafter acquired, or any claims for damages by way of any past, present and
future infringement of any of the foregoing (collectively, the “Intellectual
Property”); provided, however, that the Collateral shall include all accounts
and general intangibles that consist of rights to payment from the sale,
licensing or disposition of all or any part of, or rights in, the Intellectual
Property (the “Rights to Payment”).  Notwithstanding the foregoing, if
a judicial authority (including a U.S. Bankruptcy Court) holds that a security
interest in the underlying Intellectual Property is necessary to have a security
interest in the Rights to Payment, then the Collateral shall automatically, and
effective as of March 28, 2008, include the Intellectual Property to the extent
necessary to permit perfection of Bank’s security interest in the Rights to
Payment.

     

    

     

    Exhibit A - Page
9

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