Document:

EX-10.1

 Exhibit 10.1 
 FIRST AMENDMENT 
 TO 

SECOND AMENDED AND RESTATED 
 LOAN AND SECURITY AGREEMENT 
 This First Amendment to Second Amended and
Restated Loan and Security Agreement (this “Amendment”) is entered into this ____ day of May, 2013 (the “First Amendment Effective Date”), by and between Silicon Valley Bank (“Bank”) SONIC
FOUNDRY, INC., Maryland corporation (“Sonic Foundry”), and SONIC FOUNDRY MEDIA SYSTEMS, INC., a Maryland corporation (“Sonic Systems” and together with Sonic Foundry, jointly and severally, individually
and collectively, the “Borrower”). 
 RECITALS 

A. Bank and Borrower have entered into that certain Second Amended and Restated Loan and Security Agreement dated as of
June 27, 2011 (as the same may from time to time be further amended, modified, supplemented or restated, the “Loan Agreement”). 
 B. Bank has extended credit to Borrower for the purposes permitted in the Loan Agreement. 
 C. Borrower has requested that Bank amend the Loan Agreement to (i) extend the maturity date, (ii) decrease the interest rate, (iii) remove the former sub-limits under the Revolving
Line, and (iv) make certain other revisions to the Loan Agreement as more fully set forth herein. 
 D. Bank has
agreed to so amend certain provisions of the Loan Agreement, but only to the extent, in accordance with the terms, subject to the conditions and in reliance upon the representations and warranties set forth below. 

AGREEMENT 
 NOW, THEREFORE, in consideration of the foregoing recitals and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, and
intending to be legally bound, the parties hereto agree as follows: 
 1. Definitions. Capitalized terms used but not
defined in this Amendment shall have the meanings given to them in the Loan Agreement. 
 2. Amendments to Loan
Agreement. 
 2.1 Section 2.1.2 (Letters of Credit Sublimit), Section 2.1.3 (Foreign Exchange Sublimit) and
Section 2.1.4 (Cash Management Services Sublimit). Sections 2.1.2, 2.1.3 and 2.1.4 of the Loan Agreement are hereby amended in their entirety and replaced with the following: 

 “2.1.2 [Reserved]. 

2.1.3 [Reserved]. 
 2.1.4 [Reserved].” 
 2.2 Section 2.3 (Payment of
Interest on the Credit Extensions). Section 2.3(a)(i) is amended in its entirety and replaced with the following: 
 “(i) Advances. Subject to Section 2.3(b), from and after the First Amendment Effective Date, the principal amount outstanding under the Revolving Line shall accrue interest at a floating
per annum rate equal to the Prime Rate plus one and one-quarter percent (1.25%); provided, that during a Streamline Period, the principal amount outstanding under the Revolving Line shall accrue interest at a floating per annum rate
equal to the Prime Rate plus three-quarters of one percent (0.75%), which interest shall in any event be payable monthly, in arrears, in accordance with Section 2.3(f) below. 

2.3 Section 2.4(e) (Unused Revolving Line Facility Fee). Section 2.4(e) is amended in its entirety and replaced with the
following: 
 “(e) Unused Revolving Line Facility Fee. A fee (the “Unused Revolving Line
Facility Fee”), payable quarterly, in arrears, on a calendar year basis, in an amount equal to seventeen and one-half one hundredths of one percent (0.175%) per annum of the average unused portion of the Revolving Line. The unused
portion of the Revolving Line, for purposes of this calculation, shall equal the difference between (x) the Revolving Line amount (as it may be reduced from time to time) and (y) the average for the period of the daily closing balance of
the Revolving Line outstanding plus, to the extent applicable, the Term Loan Reserve Amount. Borrower shall not be entitled to any credit, rebate or repayment of any Unused Revolving Line Facility Fee previously earned by Bank pursuant to this
Section notwithstanding any termination of the Agreement or the suspension or termination of Bank’s obligation to make loans and advances hereunder;” 
 2.4 Section 3.4(a) (Procedures for Borrowing). Section 3.4(a) is amended in its entirety and replaced with the following: 

“(a) Advances. Subject to the prior satisfaction of all other applicable conditions to the making of an
Advance set forth in this Agreement, to obtain an Advance Borrower shall notify Bank (which notice shall be irrevocable) by electronic mail, facsimile, or telephone by 12:00 noon Pacific time on the Funding Date of the Advance. Together with any
such electronic or facsimile notification, Borrower shall deliver to Bank by electronic mail or facsimile a completed Transaction Report executed by a Responsible Officer or his or her designee. Bank may rely on any telephone notice given by a
person whom Bank believes is a Responsible Officer or designee. Bank shall credit Advances to the Designated Deposit Account. Bank may make Advances under this Agreement based on instructions from a Responsible Officer or his or her designee or
without instructions if the Advances are necessary to meet Obligations which have become due.” 

 2.5 Section 4.1 (Grant of Security Interest). Section 4.1 is amended in its
entirety and replaced with the following: 
 “4.1 Grant of Security Interest. Borrower hereby grants
Bank, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Bank, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and
products thereof. 
 Borrower acknowledges that it previously has entered, and/or may in the future enter, into
Bank Services Agreements with Bank. Regardless of the terms of any Bank Services Agreement, Borrower agrees that any amounts Borrower owes Bank thereunder shall be deemed to be Obligations hereunder and that it is the intent of Borrower and Bank to
have all such Obligations secured by the first priority perfected security interest in the Collateral granted herein (subject only to Permitted Liens that are permitted pursuant to the terms of this Agreement to have superior priority to Bank’s
Lien in this Agreement). 
 If this Agreement is terminated, Bank’s Lien in the Collateral shall continue
until the Obligations (other than inchoate indemnity obligations) are repaid in full in cash. Upon payment in full in cash of the Obligations (other than inchoate indemnity obligations) and at such time as Bank’s obligation to make Credit
Extensions has terminated, Bank shall, at the sole cost and expense of Borrower, release its Liens in the Collateral and all rights therein shall revert to Borrower. In the event (x) all Obligations (other than inchoate indemnity obligations),
except for Bank Services, are satisfied in full, and (y) this Agreement is terminated, Bank shall terminate the security interest granted herein upon Borrower providing cash collateral acceptable to Bank in its good faith business judgment for
Bank Services, if any. In the event such Bank Services consist of outstanding Letters of Credit, Borrower shall provide to Bank cash collateral in an amount equal to (x) if such Letters of Credit are denominated in Dollars, then at least one
hundred five percent (105.0%); and (y) if such Letters of Credit are denominated in a Foreign Currency, then at least one hundred ten percent (110.0%), of the Dollar Equivalent of the face amount of all such Letters of Credit plus all interest,
fees, and costs due or to become due in connection therewith (as estimated by Bank in its business judgment), to secure all of the Obligations relating to such Letters of Credit.” 

2.6 Section 4.2 (Priority of Security Interest). The second paragraph of Section 4.2 is deleted in its entirety.

 2.7 Section 6.6 (Access to Collateral; Books and Records). Section 6.6 is amended in its entirety and
replaced with the following: 

 “6.6 Access to Collateral; Books and Records. At
reasonable times, on one (1) Business Day’s notice (provided no notice is required if an Event of Default has occurred and is continuing), Bank, or its agents, shall have the right to inspect the Collateral and the right to audit and copy
Borrower’s Books. Such audits shall be conducted no more often than twice per year (once per year so long as a Streamline Period remains in effect), unless an Event of Default has occurred and is continuing. The foregoing inspections and audits
shall be at Borrower’s expense, and the charge therefor shall be $750 per person per day (or such higher amount as shall represent Bank’s then-current standard charge for the same), plus reasonable out-of-pocket expenses. In the event
Borrower and Bank schedule an audit more than ten (10) days in advance, and Borrower cancels or seeks to reschedule the audit with less than ten (10) days written notice to Bank, then (without limiting any of Bank’s rights or
remedies), Borrower shall pay Bank a fee of $1,000 plus any out-of-pocket expenses incurred by Bank to compensate Bank for the anticipated costs and expenses of the cancellation or rescheduling.” 

2.8 Section 7.7 (Distributions; Investments). Section 7.7 is amended in its entirety and replaced with the
following: 
 “7.7 Distributions; Investments. Borrower shall not do any of the following without
Bank’s prior written consent, which consent shall not be unreasonably withheld or delayed, (a) Pay any dividends or make any distribution or payment or redeem, retire or purchase any capital stock; provided that (i) Borrower
may convert any of its convertible securities into other securities pursuant to the terms of such convertible securities or otherwise in exchange thereof, (ii) Borrower may pay dividends solely in common stock; and (iii) Borrower may
repurchase the shares of its common stock, so long as (X) Borrower can demonstrate pro forma compliance with the financial covenants contained in Section 6.9, after giving effect to such proposed repurchase (including, without limitation,
Debt Service Coverage Ratio of at least 1.25:1.00); (Y) an Event of Default does not exist at the time of such repurchase and would not exist after giving effect to such repurchase; and (Z) such repurchase does not exceed in the aggregate
of One Million Dollars ($1,000,000) during the term of this Agreement; or (b) directly or indirectly make any Investment other than Permitted Investments, or permit any of its Subsidiaries to do so.” 

2.9 Section 9.1(Rights and Remedies). Sections 9.1(c) and 9.1(d) are amended, each in its entirety, and replaced with the
following: 
 “(c) demand that Borrower (i) deposit cash with Bank in an amount equal to at least 105%
(110% for Letters of Credit denominated in a currency other than Dollars), of the Dollar Equivalent of the aggregate face amount of all Letters of Credit remaining undrawn (plus all interest, fees, and costs due or to become due in connection
therewith (as estimated by Bank in its good faith business judgment)), to secure all of the Obligations relating to such Letters of Credit, as collateral security for the repayment of any future drawings under such Letters of Credit, and Borrower
shall forthwith deposit and pay such amounts, and (ii) pay in advance all letter of credit fees scheduled to be paid or payable over the remaining term of any Letters of Credit; 

 (d) terminate any foreign exchange forward contracts;” 

2.10 Section 13 (Definitions). The following terms and their respective definitions set forth in
Section 13.1 are amended in their entirety and replaced with the following: 
 “Availability
Amount” is (a) the lesser of (i) the Revolving Line or (ii) the amount available under the Borrowing Base minus the Term Loan Reserve Amount minus (b) the outstanding principal balance of any Advances.

 “Credit Extension” is any Advance, Letter of Credit, Prior Term Loan, Term Loan 2011
Advance, foreign exchange forward contracts, amount utilized for cash management services, or any other extension of credit by Bank for Borrower’s benefit. 
 “Letter of Credit” is a standby or commercial letter of credit issued by Bank upon request of Borrower based upon an application, guarantee, indemnity, or similar agreement. 

“Loan Documents” are, collectively, this Agreement, any Bank Services Agreements, the Perfection Certificate, each IP
Agreement, each Subordination Agreement, any note, or notes or guaranties executed by Borrower or any Guarantor, and any other present or future agreement between Borrower, any Guarantor and/or for the benefit of Bank in connection with this
Agreement and/or Bank Services, all as amended, restated, or otherwise modified. 
 “Revolving Line
Maturity Date” is October 1, 2015. 
 2.11 Section 13 (Definitions). The following new terms
and their respective definitions are hereby inserted in Section 13.1, each in its applicable alphabetical order: 

“Bank Services” are any products, credit services, and/or financial accommodations previously, now, or hereafter
provided to Borrower or any of its Subsidiaries by Bank or any Bank Affiliate, including, without limitation, any letters of credit, cash management services (including, without limitation, merchant services, direct deposit of payroll, business
credit cards, and check cashing services), interest rate swap arrangements, and foreign exchange services as any such products or services may be identified in Bank’s various agreements related thereto (each, a “Bank Services
Agreement”). 
 “First Amendment Effective Date” is May ____, 2013. 

2.12 Section 13 (Definitions). The following definitions are deleted in their entirety: 

“Cash Management Services” is defined in Section 2.1.4. 

“FX Business Day” is any day when (a) Bank’s Foreign Exchange Department is conducting its normal business and
(b) the Foreign Currency being purchased or sold by Borrower is available to Bank from the entity from which Bank shall buy or sell such Foreign Currency. 

 “FX Forward Contract” is defined in Section 2.1.3. 

“FX Reserve” is defined in Section 2.1.3. 
 “FX Reduction Amount” is defined in Section 2.1.3. 

“Letter of Credit Application” is defined in Section 2.1.2(a). 

“Letter of Credit Reserve” has the meaning set forth in Section 2.1.2(d). 

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

3.1 The amendments set forth in Section 2, above, are effective for the purposes set forth herein and shall be limited
precisely as written and shall not be deemed to (a) be a consent to any amendment, waiver or modification of any other term or condition of any Loan Document, or (b) otherwise prejudice any right or remedy which Bank may now have or may
have in the future under or in connection with any Loan Document. 
 3.2 This Amendment shall be construed in connection
with and as part of the Loan Documents and all terms, conditions, representations, warranties, covenants and agreements set forth in the Loan Documents, except as herein amended, are hereby ratified and confirmed and shall remain in full force and
effect. 
 4. Representations and Warranties. To induce Bank to enter into this Amendment, Borrower hereby represents and
warrants to Bank as follows: 
 4.1 Immediately after giving effect to this Amendment (a) the representations and
warranties contained in the Loan Documents are true, accurate and complete in all material respects as of the date hereof (except to the extent such representations and warranties relate to an earlier date, in which case they are true and correct as
of such date), and (b) no Event of Default has occurred and is continuing; 
 4.2 Borrower has the power and
authority to execute and deliver this Amendment and to perform its obligations under the Loan Agreement, as amended by this Amendment; 
 4.3 The organizational documents of Borrower delivered to Bank on the Effective Date remain true, accurate and complete and have not been amended, supplemented or restated and are and continue to
be in full force and effect; 
 4.4 The execution and delivery by Borrower of this Amendment and the performance by
Borrower of its obligations under the Loan Agreement, as amended by this Amendment, have been duly authorized; 

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

4.6 The execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan
Agreement, as amended by this Amendment, do not require any order, consent, approval, license, authorization or validation of, or filing, recording or registration with, or exemption by any governmental or public body or authority, or subdivision
thereof, binding on either Borrower, except as already has been obtained or made; and 
 4.7 This Amendment has been duly
executed and delivered by Borrower and is the binding obligation of Borrower, enforceable against Borrower in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, liquidation, moratorium
or other similar laws of general application and equitable principles relating to or affecting creditors’ rights. 
 5.
Ratification of Intellectual Property Security Agreement. Borrower hereby ratifies, confirms and reaffirms, all and singular, the terms and conditions of each Intellectual Property Security Agreement, each dated as of June 16, 2008 between
each respective Borrower and Bank, and acknowledges, confirms and agrees that said Intellectual Property Security Agreements (a) contain an accurate and complete listing of all respective Intellectual Property Collateral, as defined in such
Intellectual Property Security Agreement, and (b) shall remain in full force and effect. 
 6. No Defenses of
Borrower. Borrower hereby acknowledges and agrees that Borrower has no offsets, defenses, claims, or counterclaims against Bank with respect to the Obligations, or otherwise, and that if Borrower now has, or ever did have, any offsets, defenses,
claims, or counterclaims against Bank, whether known or unknown, at law or in equity, all of them are hereby expressly WAIVED and Borrower hereby RELEASES Bank from any liability thereunder. 

7. Integration. This Amendment and the Loan Documents represent the entire agreement about this subject matter and supersede prior
negotiations or agreements. All prior agreements, understandings, representations, warranties, and negotiations between the parties about the subject matter of this Amendment and the Loan Documents merge into this Amendment and the Loan Documents.

 8. Counterparts. This Amendment may be executed in any number of counterparts and all of such counterparts taken
together shall be deemed to constitute one and the same instrument. 

 9. Effectiveness. This Amendment shall be deemed effective upon (a) the due
execution and delivery to Bank of this Amendment by each party hereto, (b) updated Secretary’s Corporate Borrowing Certificates for each Borrower (with updated attachments, if necessary), (c) Certificates of Good Standing and Foreign
Qualification, as applicable, (d) updated Perfection Certificates for each Borrower, (e) updated evidence of insurance, and (f) Bank’s legal fees and expenses incurred in connection with the existing Loan Documents and this
Amendment. 
 [Signature page follows.] 

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

			
	BANK
	
	 SILICON VALLEY BANK

		
	By	 	 
	Name:	 	 
	Title:	 	 
	
	BORROWER
	
	 SONIC FOUNDRY, INC.

		
	By	 	 
	Name:	 	 
	Title:	 	 
	
	 SONIC FOUNDRY MEDIA SYSTEMS, INC.

		
	By	 	 
	Name:	 	 
	Title:	 	 

 Exhibit A to First Amendment 

EXHIBIT C 
 COMPLIANCE CERTIFICATE 
  

			
	TO:        SILICON VALLEY BANK	  	Date:
                        

  

FROM:        SONIC FOUNDRY, INC. 
             SONIC FOUNDRY MEDIA SYSTEMS, INC. 
 The undersigned authorized officer of SONIC FOUNDRY, INC. and SONIC FOUNDRY MEDIA SYSTEMS, INC. (“Borrower”) certifies that under the terms and conditions of the Loan and Security
Agreement between Borrower and Bank (the “Agreement”), (1) Borrower is in complete compliance for the period ending _______________ with all required covenants except as noted below, (2) there are no Events of Default,
(3) all representations and warranties in the Agreement are true and correct in all material respects on this date except as noted below; provided, however, that such materiality qualifier shall not be applicable to any representations and
warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material
respects as of such date, (4) Borrower, and each of its Subsidiaries, has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed
by Borrower except as otherwise permitted pursuant to the terms of Section 5.9 of the Agreement, and (5) no Liens have been levied or claims made against Borrower or any of its Subsidiaries, if any, relating to unpaid employee payroll or
benefits of which Borrower has not previously provided written notification to Bank. Attached are the required documents supporting the certification. The undersigned certifies that these are prepared in accordance with GAAP consistently applied
from one period to the next except as explained in an accompanying letter or footnotes. The undersigned acknowledges that no borrowings may be requested at any time or date of determination that Borrower is not in compliance with any of the terms of
the Agreement, and that compliance is determined not just at the date this certificate is delivered. Capitalized terms used but not otherwise defined herein shall have the meanings given them in the Agreement. 

Please indicate compliance status by circling Yes/No under “Complies” column. 

 

					
	Reporting Covenant	 	Required	 	Complies
	Monthly financial statements with Compliance Certificate	 	Monthly within 30 days	 	Yes    No
	Annual financial statement (CPA Audited) + CC	 	FYE within 120 days	 	Yes    No
	10-Q, 10-K and 8-K	 	Within 5 days after filing with SEC	 	Yes    No
	A/R & A/P Agings	 	Monthly within 15 days	 	Yes    No
	Transaction Reports	 	 Weekly (monthly within 15 days during a Streamline Period) and
with each request for
 a Credit Extension
	 	Yes    No
	Projections	 	 Within fifteen (15) following approval

by the Borrower’s board of directors, and in any event within fifteen (15) days after the end of each fiscal year of Borrower,

and as amended and/or updated
	 	Yes     No
	
The following Intellectual Property was registered after the Effective Date (if no registrations, state
“None”)
  
  

  
 2 

							
	Financial Covenant	 	        Required     
   	 	        Actual      
  	 	      
  Complies        
	 Maintain as
indicated:
	 	 	 	 	 	 
	 Minimum Adjusted Quick Ratio
(monthly)
	 	1.75:1.00	 	_____:1.0	 	Yes    No
	 Minimum Debt Service Ratio
(monthly)
	 	1.25:1.00	 	_____:1.0	 	Yes    No
	 Maximum Term Debt (at all
times)
	 	$2,400,000	 	$_______	 	Yes    No

 Performance Pricing 

 

							
	  	  	Term Loan 2011	  	Revolving Line	  	      
  Applies        
	 Adjusted Quick Ratio >
2.00:1.00
	  	Prime + 3.25%	  	Prime +0.75%	  	Yes    No
	 Adjusted Quick Ratio <
2.00:1.00
	  	Prime + 3.75%	  	Prime + 1.25%	  	Yes    No

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

 
  

 
  

 
  

 

 

			
	
	 SONIC FOUNDRY, INC.

SONIC FOUNDRY MEDIA SYSTEMS, INC.

		
	By:	 	 
	Name:	 	 
	Title:	 	 

 

			
	
	BANK USE ONLY
		
	Received by:	 	 
		 	AUTHORIZED SIGNER
		
	Date:	 	 
		
	Verified:	 	 
		 	AUTHORIZED SIGNER
		
	Date:	 	 

Compliance Status:    Yes    No

 

  
 3 

 Schedule 1 to Compliance Certificate 

Financial Covenants of Borrower 
 In the event of a conflict between this Schedule and the Loan Agreement, the terms of the Loan Agreement shall govern. 
 Dated: ____________________ 
  

					
	I.	 	Adjusted Quick Ratio (Section 6.9(a))	  	
			
	Required:	 	An Adjusted Quick Ratio of at least 1.75:1.00.	  	
			
	Actual:	 		  	
			
	  A.	 	Aggregate value of Borrower’s unrestricted cash at Bank	  	$_____
			
	  B.	 	Aggregate value of the net billed accounts receivable of Borrower	  	$_____
			
	  C.	 	Quick Assets (the sum of lines A plus B)	  	$_____
			
	  D.	 	Aggregate value of Obligations to Bank	  	$_____
			
	  E.	 	Without duplication, Aggregate value of liabilities of Borrower and its Subsidiaries (including all Indebtedness) that matures within one (1) year and current portion of
Subordinated Debt permitted by Bank to be paid by Borrower	  	$_____
			
	  F.	 	Current Liabilities (the sum of lines D plus line E)	  	$_____
			
	  G.	 	Current portion of Deferred Revenue	  	$_____
			
	  H.	 	Adjusted Current Liabilities (line F minus line G).	  	$_____
			
	  I.	 	Adjusted Quick Ratio (line D divided by line H), expressed as a ratio	  	____:1.00

 Is line I equal to or greater than 1.75:1:00? 
 _____ No, not in
compliance                                _____ Yes, in compliance 

  
 4 

 II.                Debt
Service Coverage Ratio (Section 6.9(b)) 
 Required: Maintain, as of the last day of each fiscal month, measured on a trailing three
(3) month basis ending as of the date of measurement, maintain a ratio of EBITDA divided by Debt Service (the “Debt Service Coverage Ratio”) of at least 1.25:1.00. 

Actual: All amounts measured on a trailing three (3) month basis 
  

					
	  A.	 	EBITDA	  	$_____
			
	  B.	 	all regularly scheduled payments of principal and interest of Indebtedness of Borrower and its Subsidiaries determined on a consolidated basis due within the trailing three (3)
month period ended as of such date of measurement.	  	$_____
			
	  C.	 	Debt Service Coverage Ratio (line A divided by line B)	  	____:1.00

 Is line C equal to or greater than 1.25:1.00? 
 _____ No, not in compliance; Term Loan Reserve Period in effect.
                                _____ Yes, in compliance. 

If not in compliance, no Event of Default shall be deemed to have occurred and be continuing solely as a result of Borrower’s failure to maintain
such Debt Service Coverage Ratio, but only to the extent that Borrower immediately enters into a Term Loan Reserve Period and no other Event of Default has occurred and is continuing or would immediately occur as a result of entering into such Term
Loan Reserve Period; including, without limitation, an “Overadvance as describe in Section 2.2. 

  
 1 

III.                Maximum Term Debt (Section 6.9(c)) 

Required: The outstanding principal balance of the Term Loan 2011 plus the outstanding principal balance of the Prior Term Loan plus the
outstanding principal balance of all PFG Subordinated Debt shall not exceed Two Million Four Hundred Thousand Dollars ($2,400,000) at any time. 

Actual: 
  

					
	  A.	  	Outstanding principal balance of the Term Loan 2011	  	$_____
			
	  B.	  	Outstanding principal balance of the Prior Term Loan	  	$_____
			
	  C.	  	Outstanding principal balance of all PFG Subordinated Debt	  	$_____
			
	  D.	  	All other balance sheet term debt of Borrower	  	$_____
			
	  E.	  	Total Term Debt (line A plus Line B plus line C plus line D)	  	$_____

 Is line E equal to or less than $2,400,000? 
 _____ No, not in
compliance                                _____ Yes, in complianceEX-4.3

 Exhibit 4.3 
 STOCK OPTION AGREEMENT 
 TO: [Recipient Name] (Employee Number: nnnnn) 

DATED: [Date]  
 Pursuant to the 2009
Long Term Incentive Plan (the “Plan”) of Covisint Corporation (the “Corporation” or “Company”) and with the approval of the Corporation’s Board of Directors in accordance with the Plan, the Corporation grants you
an option (the “Option”) to purchase [#shares] shares of Common Stock (the “Shares”) at $[price] per share, upon the terms and conditions contained in this Stock Option Agreement (the “Agreement”) and in
the Plan. The Option is intended to be a Nonqualified Option. The Plan, as amended from time to time, is made a part of this Agreement and is available upon request. Capitalized terms used in this Agreement, but not otherwise defined in this
Agreement, shall have the meanings given them in the Plan. 
 1. Vesting Schedule. Subject to the terms contained in this
Agreement and in the Plan, you may exercise the Option to purchase the shares on and after the closing of the Initial Public Offering for shares of the Company. 
 2. Expiration. This Option will expire at the earliest to occur of (a) the close of business on August 25, 2015 if the Company has not closed the Initial Public Offering,
(b) upon termination of your employment for any reason (including without limitation, due to death, Disability, for Cause (as defined in Section 5 of this Agreement) or without Cause) prior to vesting, or (c) to the extent not
previously vested, upon a change in control of the Parent. A “change of control of Parent” means the closing or effectiveness of an acquisition of Parent by a third party, regardless of the form of the acquisition. If the Company has
closed the Initial Public Offering on or prior to August 25, 2015, this Option will expire (to the extent not previously exercised) on August 25, 2019 (the “Expiration Date”), unless terminated earlier in accordance with the Plan
or Section 5 of this Agreement. 
 3. Non-Transferable. The Option may not be transferred by you other than by will or by the
laws of descent and distribution or as otherwise provided in the Plan and, during your lifetime, the Option is exercisable only by you. 
 4.
Change in Control. Subject to Section 9.2(b) of the Plan, upon a Change in Control of the Company, the Option shall immediately become fully Vested. 
 5. Termination of Employment. 
 (a) If your employment is terminated by your
employer without Cause or by you, you shall have the right for a period of 30 days after such termination, but in no event after the Expiration Date, to exercise that portion of this Option, if any, that was exercisable by you on the date of such
termination. If you die during the 30-day period following termination, your legal representative or the person or persons to whom your rights shall pass by will or by the laws of descent and distribution shall have the right for a period of 120
days following your death, but in no event after the Expiration Date, to exercise that portion of this Option, if any, that was exercisable by you on the date of your termination. 
 (b) If your employment is terminated by your employer with Cause, this Option shall terminate and shall not be exercisable by you after such termination. Termination for “Cause” means
termination for (1) continued failure to make a good faith effort to perform your duties, (2) any willful act or omission that you knew or should have known would injure the Corporation, its Parent or any of its Subsidiaries,
(3) fraud, (4) dishonesty, (5) commission of a felony, or violation of any law relating to your employment, (6) failure to devote substantially full time to your employment duties (except because of illness or Disability),
(7) insubordination, (8) an act or omission that is contrary to the direction of your supervisor, if such direction relates to your duties to the Corporation, its Parent or any of its Subsidiaries that are reasonably performable, or
(9) violation of the Parent’s Code of Conduct. 
 (c) If your employment terminates by reason of your death, your legal representative
or the person(s) to whom your rights shall pass by will or by the laws of descent and distribution shall have the right for a period of 12 months after your death, but in no event after the Expiration Date, to exercise that portion of this Option,
if any, that was exercisable by you at the time of death. 
 (d) If your employment terminates by reason of your Disability, you shall have the
right for a period of 12 months after such termination, but in no event after the Expiration Date, to exercise that portion of this Option, if any, that was exercisable by you on the date of such termination. For purposes of this Agreement, you
shall be deemed to be “Disabled” and to have a “Disability” if you are permanently and totally disabled as a result of a physical or mental disability (within the meaning of Section 22(e) of the Internal Revenue Code), as
determined by a medical doctor satisfactory to the Committee. 

 6. Manner of Exercise. The exercise price for Shares upon exercise of the Option shall be paid
in full in cash or by personal check, bank draft or money order at the time of exercise; provided, however, that in lieu of such form of payment, subject to the limitations set forth in Section 2.4 of the Plan, payment may be made by
(a) delivery and transfer, in a manner acceptable to the Corporation’s Secretary in his sole discretion, to the Corporation of outstanding shares of Common Stock; (b) by delivery to the Corporation’s Secretary or his designee of
a properly executed exercise notice, acceptable to the Corporation, together with irrevocable instructions to the Optionee’s broker to deliver to the Corporation sufficient cash to pay the exercise price and any applicable income and employment
withholding taxes, in accordance with a written agreement between the Corporation and the brokerage firm; or (c) any other method permitted in Section 2.4 of the Plan. Shares of Common Stock surrendered upon exercise shall be valued at the
Fair Market Value per share as determined at the end of the day prior to the date of exercise. 
 7. Rights as Stockholder. As the
holder of the Option you shall not be, nor have any of the rights or privileges of, a stockholder of the Corporation in respect of any Shares unless a certificate or certificates representing such Shares shall have been issued by the Corporation to
you or a book entry representing such Shares has been made and such Shares have been deposited with the appropriate registered book-entry custodian. The Corporation shall not be liable to you for damages relating to any delay in issuing shares or a
stock certificate to you, any loss of a certificate, or any mistakes or errors in the issuance of shares or a certificate to you. 
 8.
Withholding. Your employer shall have the right to withhold from your compensation or to require you to remit sufficient funds to satisfy applicable withholding for income and employment taxes upon the exercise of an Option. Subject to
the limitations in Section 10.5 of the Plan, you may, in order to fulfill the withholding obligation, make payment to your employer in any manner permitted under Section 10.5 of the Plan. Your employer shall be authorized to take such
action as may be necessary, in the opinion of its counsel (including, without limitation, withholding vested Common Stock otherwise deliverable to you and/or withholding amounts from any compensation or other amounts your employer owes you), to
satisfy the obligations for payment of any such taxes. 
 9. No Guarantee of Employment. Nothing contained in this Agreement or in
the Plan, nor any action taken by your employer or the Committee under the Plan or this Agreement, shall confer upon you any right with respect to continuation of your employment or other service by or to the Corporation or any Parent or Subsidiary
of the Corporation, nor interfere in any way with the right of the Corporation or any Parent or Subsidiary to terminate your employment or other service at any time, and if you are an employee, your employment is and shall remain employment at will,
except as otherwise specifically provided by law or in a written employment agreement between you and your employer. 
 10. Personal
Data. By entering into this Agreement, you consent to the disclosure, transfer and/or processing of any relevant personal data in relation to the administration of the Plan by the Corporation or any third party authorized by the Corporation
to administer the Plan on its behalf, and in particular such processing as is necessary in relation to your holding and exercising the Option. The relevant personal data that will be processed includes but is not limited to name, employee number,
hire date, job title and location. 
 11. Plan Terms Control. In the event of a conflict between the Plan and this Agreement, the
terms of the Plan shall control, it being understood that variations in this Agreement from terms set forth in the Plan shall not be considered to be in conflict if the Plan permits such variations. 

 12. Notices. Any notices to be given to the Corporation under the terms of this Agreement
shall be addressed to the Corporation in care of its Secretary, and any notices to you shall be addressed to you at the address stated in the Corporation’s records. 

 

			
	Very truly yours,
	
	COVISINT CORPORATION
		
	By:	 	 /s/ Peter Karmanos, Jr.

		 	Peter Karmanos, Jr.
		 	Its: Chairman

 The above is agreed to and accepted by: 
  

			
	Optionee’s Signature	  	Date

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