Document:

Amended and Restated Loan and Security Agreement

 Exhibit 10.1 
 AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT 
 THIS AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT (this “Agreement”) dated as of the Effective Date between SILICON VALLEY BANK, a California corporation (“Bank”), and SONIC FOUNDRY, INC., a Maryland corporation (“Sonic
Foundry”) and SONIC FOUNDRY MEDIA SYSTEMS, INC., a Maryland corporation (“Sonic Systems”; and collectively with Sonic Foundry, “Borrower”), jointly and severally, provide the terms on which Bank
shall lend to Borrower and Borrower shall repay Bank. The parties agree as follows: 
 RECITALS 
 A. Bank and Borrower have entered into that certain Loan and Security Agreement dated as of May 2, 2007 (as may amended from time to time, the
“Existing Loan Agreement”) under which Bank agreed to make available to Borrower a revolving line of credit in the maximum principal amount of $3,000,000 (the “Existing Line”) and term loan in the maximum principal
amount of $1,000,000 (the “Existing Term Loan”, and collectively with the Existing Line, the “Existing Obligations”). 
 B. Borrower has requested that Bank refinance the Existing Line and amend and restate the Existing Loan Agreement. 
 C. Bank has agreed to so amend and restate the Existing 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. 
  

	 	1	ACCOUNTING AND OTHER TERMS 

 1.1
Accounting and Other Terms. Accounting terms not defined in this Agreement shall be construed following GAAP. Calculations and determinations must be made following GAAP. Capitalized terms not otherwise defined in this Agreement shall have the
meanings set forth in Section 13. All other terms contained in this Agreement, unless otherwise indicated, shall have the meaning provided by the Code to the extent such terms are defined therein. 
 1.2 Designation of Agent. Each Borrower hereby designates Sonic Foundry (hereinafter sometimes referred to as “Agent”) as the
agent of that Borrower to discharge the duties and responsibilities of Agent as provided herein. 
 1.3 Operation of Borrower. Except
as otherwise provided in this Article, loans and advances hereunder shall be requested solely by Agent, as agent for each Borrower. Each Borrower shall be directly indebted to Bank for each Credit Extension distributed to Agent, together with all
accrued interest thereon, as if that amount had been advanced directly by Bank to such Borrower. Bank shall have no responsibility to inquire to the distribution of Credit Extensions made by Bank through Agent as described herein. 
 1.4 Continuation of Authority of Agent. The authority of Agent to request Credit Extensions on behalf of, and to bind, Borrowers shall continue
unless and until Bank actually receives writing notice of the termination of such authority. 
  

	 	2	LOAN AND TERMS OF PAYMENT 

 2.1 Promise to
Pay. Borrower hereby unconditionally promises to pay Bank the outstanding principal amount of all Credit Extensions and accrued and unpaid interest thereon as and when due in accordance with this Agreement. 
 2.1.1 Revolving Advances. 
 (a)
Availability. Subject to the terms and conditions of this Agreement and to deduction of Reserves, Bank shall make Advances not exceeding the Availability Amount. Amounts borrowed hereunder may be repaid and, prior to the Revolving Line
Maturity Date, reborrowed, subject to the applicable terms and conditions precedent herein. 

 (b) Termination; Repayment. The Revolving Line terminates on the Revolving Line Maturity Date,
when the principal amount of all Advances, the unpaid interest thereon, and all other Obligations relating to the Revolving Line shall be immediately due and payable. 
 (c) Initial Advance. This Agreement amends and restates the Existing Loan Agreement. All advances made under, and the outstanding balance of, the Existing Line shall be, and hereby are, refinanced by the
initial Advance made hereunder and shall be repaid as Advances pursuant to the terms hereof. 
 2.1.2 Letters of Credit Sublimit.

 (a) As part of the Revolving Line and the Other Services Sublimit, Bank shall issue or have issued Letters of Credit for Borrower’s
account. Such aggregate amounts utilized hereunder shall at all times reduce the amount otherwise available for Advances under the Revolving Line and under the Other Services Sublimit. The face amount of outstanding Letters of Credit (including
drawn but unreimbursed Letters of Credit and any Letter of Credit Reserve) may not exceed the lesser of the Availability Amount or the amount available under the Other Services Sublimit. If, on the Revolving Line Maturity Date, there are any
outstanding Letters of Credit, then on such date Borrower shall provide to Bank cash collateral in an amount equal to 105% of the face amount of all such Letters of Credit plus all interest, fees, and costs due or to become due in connection
therewith (as estimated by Bank in its good faith business judgment), to secure all of the Obligations relating to said Letters of Credit. All Letters of Credit shall be in form and substance acceptable to Bank in its sole discretion and shall be
subject to the terms and conditions of Bank’s standard Application and Letter of Credit Agreement (the “Letter of Credit Application”). Borrower agrees to execute any further documentation in connection with the Letters of
Credit as Bank may reasonably request. Borrower further agrees to be bound by the regulations and interpretations of the issuer of any Letters of Credit guarantied by Bank and opened for Borrower’s account or by Bank’s interpretations of
any Letter of Credit issued by Bank for Borrower’s account, and Borrower understands and agrees that Bank shall not be liable for any error, negligence, or mistake, whether of omission or commission, in following Borrower’s instructions or
those contained in the Letters of Credit or any modifications, amendments, or supplements thereto. 
 (b) The obligation of Borrower to
immediately reimburse Bank for drawings made under Letters of Credit shall be absolute, unconditional, and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, such Letters of Credit, and the Letter of Credit
Application. 
 (c) Borrower may request that Bank issue a Letter of Credit payable in a Foreign Currency. If a demand for payment is made
under any such Letter of Credit, Bank shall treat such demand as an Advance to Borrower of the equivalent of the amount thereof (plus fees and charges in connection therewith such as wire, cable, SWIFT or similar charges) in Dollars at the
then-prevailing rate of exchange in San Francisco, California, for sales of the Foreign Currency for transfer to the country issuing such Foreign Currency. 
 (d) To guard against fluctuations in currency exchange rates, upon the issuance of any Letter of Credit payable in a Foreign Currency, Bank shall create a reserve (the “Letter of Credit Reserve”)
under the Revolving Line in an amount equal to ten percent (10%) of the face amount of such Letter of Credit. The amount of the Letter of Credit Reserve may be adjusted by Bank from time to time to account for fluctuations in the exchange rate.
The availability of funds under the Revolving Line shall be reduced by the amount of such Letter of Credit Reserve for as long as such Letter of Credit remains outstanding. 
 2.1.3 Foreign Exchange Sublimit. As part of the Revolving Line and the Other Services Sublimit, Borrower may enter into foreign exchange contracts
with Bank under which Borrower commits to purchase from or sell to Bank a specific amount of Foreign Currency (each, a “FX Forward Contract”) on a specified date (the “Settlement Date”). FX Forward Contracts shall
have a Settlement Date of at least one (1) FX Business Day after the contract date and shall be subject to a reserve of ten percent (10%) of each outstanding FX Forward Contract in a maximum aggregate amount equal to Seventy-Five Thousand
Dollars ($75,000) (the “FX Reserve”). The aggregate amount of FX Forward Contracts at any one time may not exceed ten (10) times the amount of the FX Reserve and the aggregate amount of FX Forward Contracts may not exceed the
amount available at the time of such FX Forward Contract under the Other Services Sublimit. The amount otherwise available for Credit Extensions under the Revolving Line shall be reduced by an amount equal to ten percent (10%) of each
outstanding FX Forward Contract (the “FX Reduction Amount”). Any amounts needed to fully reimburse Bank will be treated as Advances under the Revolving Line and will accrue interest at the interest rate applicable to Advances.

  

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 2.1.4 Cash Management Services Sublimit. Borrower may use up to the amount available under the
Other Services Sublimit of the Revolving Line for Bank’s cash management services which may include merchant services, direct deposit of payroll, business credit card, and check cashing services identified in Bank’s various cash management
services agreements (collectively, the “Cash Management Services”). Any amounts Bank pays on behalf of Borrower for any Cash Management Services will be treated as Advances under the Revolving Line and will accrue interest at the
interest rate applicable to Advances. 
 2.2 Existing Term Loan 
 2.2.1 Repayment. The outstanding principal balance of the Existing Term Loan as of the Effective Date is $638,888.86. Borrower shall continue
paying the Existing Term Loan on the first day of each month in (i) monthly installments of principal, plus (ii) monthly payments of accrued interest (the “Term Loan Payment”). Amounts repaid under the Existing Term Loan
may not be reborrowed. Borrower’s final Term Loan Payment, due on the Term Loan Maturity Date, shall include all outstanding principal and unpaid interest on the Existing Term Loan. 
 2.2.2 Term Loan Balance Reserve. At all times Borrower achieves EBITDA, as tested on the last day of each month for the six (6) month period
then ending, of less than $200,000 for such six (6) month period, Bank shall maintain a reserve under the Revolving Line in an amount equal to the outstanding principal balance of the Existing Term Loan (the “Term Loan Balance
Reserve”). 
 2.3 Overadvances If, at any time, the sum of (a) the outstanding principal amount of any Advances
(including any amounts used for Cash Management Services), plus (b) the face amount of any outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit and any Letter of Credit Reserve), plus (c) the FX Reduction
Amount, plus (d) the Term Loan Balance Reserve, if applicable (such sum being an “Overadvance”) exceeds the lesser of either the Revolving Line or the Borrowing Base, Borrower shall immediately pay to Bank in cash such
Overadvance. Without limiting Borrower’s obligation to repay Bank any amount of the Overadvance, Borrower agrees to pay Bank interest on the outstanding amount of any Overadvance, on demand, at the Default Rate. 
 2.4 Payment of Interest on the Credit Extensions.  
 (a) Interest Rate; 
 (i) Advances. Subject to Section 2.4(b), the amounts outstanding
under the Revolving Line shall accrue interest at a per annum rate equal to the following: (i) during such period that Borrower maintains an Adjusted Quick Ratio of greater than 2.00 to 1.00, interest shall accrue at the greater of one percent
(1.00%) above the Prime Rate or seven percent (7.0%), or (ii) during such period that Borrower maintains an Adjusted Quick Ratio equal to or less than 2.00 to 1.00, interest shall accrue at the greater of one and one-half percent
(1.50%) above the Prime Rate or seven and one-half percent (7.5%) which interest shall be payable monthly. 
 (ii) Existing
Term Loan. Subject to Section 2.4(b), the principal amount outstanding under the Existing Term Loan shall accrue interest at a floating per annum rate equal to the greater of (i) one percentage point (1.0%) above the Prime Rate,
or (ii) eight and three-quarters of one percent (8.75%), which interest shall be payable monthly. 
 (b) Default Rate.
Immediately upon the occurrence and during the continuance of an Event of Default, Obligations shall bear interest at a rate per annum which is five percentage points above the rate that is otherwise applicable thereto (the “Default
Rate”). Payment or acceptance of the increased interest rate provided in this Section 2.3(b) is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any
rights or remedies of Bank. 
 (c) Adjustment to Interest Rate. Changes to the interest rate of any Credit Extension based on changes
to the Prime Rate shall be effective on the effective date of any change to the Prime Rate and to the extent of any such change. 
 (d)
360-Day Year. Interest shall be computed on the basis of a 360-day year for the actual number of days elapsed. 
  

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 (e) Debit of Accounts. Bank may debit any of Borrower’s deposit accounts, including the
Designated Deposit Account, for principal and interest payments or any other amounts Borrower owes Bank when due. These debits shall not constitute a set-off. 
 (f) Payment; Interest Computation; Float Charge. Interest is payable monthly on the last calendar day of each month. In computing interest on the Obligations, all Payments received after 12:00 p.m. Pacific time
on any day shall be deemed received on the next Business Day. In addition, Bank shall be entitled to charge Borrower a “float” charge in an amount equal to two (2) Business Days interest, at the interest rate applicable to the
Advances, on all Payments received by Bank. Said float charge is not included in interest for purposes of computing Minimum Monthly Interest (if any) under this Agreement. The float charge for each month shall be payable on the last day of the
month. Bank shall not, however, be required to credit Borrower’s account for the amount of any item of payment which is unsatisfactory to Bank in its good faith business judgment, and Bank may charge Borrower’s Designated Deposit Account
for the amount of any item of payment which is returned to Bank unpaid. 
 2.5 Fees. Borrower shall pay to Bank: 
 (a) Commitment Fee. A fully earned, non-refundable commitment fee of $20,000, on the Effective Date, and on each anniversary of the Effective Date;
and 
 (b) Letter of Credit Fee. Bank’s customary fees and expenses for the issuance or renewal of Letters of Credit, upon the
issuance, each anniversary of the issuance, and the renewal of such Letter of Credit by Bank; and 
 (c) Termination Fee. A
Termination Fee, if applicable, pursuant to the terms of Section 12.1; and 
 (d) Unused Revolving Line Facility Fee. A
fee (the “Unused Revolving Line Facility Fee”), payable monthly, in arrears, on a calendar year basis, in an amount equal to one half of one percent (0.50%) per annum of the average unused portion of the Revolving Line, as
determined by Bank. The unused portion of the Revolving Line, for the purposes of this calculation, shall not include amounts reserved under the Other Services Sublimit and under the Term Loan Balance Reserve. 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 suspension or termination of Bank’s obligation to make loans and
advances hereunder; and 
 (e) Collateral Monitoring Fee. A monthly collateral monitoring fee of $1,000, payable in arrears on the
last day of each month (prorated for any partial month at the beginning and upon termination of this Agreement); provided, that such fee shall be $0.00 during any Streamline Period; and 
 (f) Bank Expenses. All Bank Expenses (including reasonable attorneys’ fees and expenses, plus expenses, for documentation and negotiation of
this Agreement) incurred through and after the Effective Date, when due. 
  

	 	3	CONDITIONS OF LOANS 

 3.1 Conditions
Precedent to Initial Advance. Bank’s obligation to make the initial Advance is subject to the condition precedent that Borrower shall consent to or have delivered, in form and substance satisfactory to Bank, such documents, and completion
of such other matters, as Bank may reasonably deem necessary or appropriate, including, without limitation: 
 (a) duly executed original
signatures to the Loan Documents to which it is a party; 
 (b) duly executed original signatures to the Control Agreements from all
depositories at which Borrower maintains accounts, including, but not limited to, US Bank and Park Bank; 
 (c) its Operating Documents and a
good standing certificate of each Borrower certified by the Secretary of State of the State of Maryland as of a date no earlier than thirty (30) days prior to the Effective Date; 
  

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 (d) duly executed original signatures to the completed Borrowing Resolutions for Borrower; 
 (e) certified copies, dated as of a recent date, of financing statement searches, as Bank shall request, accompanied by written evidence (including any
UCC termination statements) that the Liens indicated in any such financing statements either constitute Permitted Liens or have been or, in connection with the initial Advance, will be terminated or released; 
 (f) the Perfection Certificate(s) executed by Borrower; 
 (g) a landlord’s consent executed by Borrower’s landlord in favor of Bank; 
 (h) the insurance
policies and/or endorsements required pursuant to Section 6.5; and 
 (i) payment of the fees and Bank Expenses then due as specified in
Section 2.5 hereof. 
 3.2 Conditions Precedent to all Credit Extensions. Bank’s obligations to make each Credit Extension,
including the initial Credit Extension, is subject to the following: 
 (a) except as otherwise provided in Section 3.4, timely receipt
of an executed Transaction Report; 
 (b) the representations and warranties in Section 5 shall be true in all material respects on the
date of the Transaction Report and on the Funding Date of each Credit Extension; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality
in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date, and no Event of Default shall have occurred
and be continuing or result from the Credit Extension. Each Credit Extension is Borrower’s representation and warranty on that date that the representations and warranties in Section 5 remain true in all material respects; provided,
however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties
expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date; and 
 (c) in
Bank’s sole discretion, there has not been any material impairment in the general affairs, management, results of operation, financial condition or the prospect of repayment of the Obligations, or there has not been any material adverse
deviation by Borrower from the most recent business plan of Borrower presented to and accepted by Bank. 
 3.3 Covenant to Deliver.

 (a) Borrower agrees to deliver to Bank each item required to be delivered to Bank under this Agreement as a condition to any Credit
Extension. Borrower expressly agrees that a Credit Extension made prior to the receipt by Bank of any such item shall not constitute a waiver by Bank of Borrower’s obligation to deliver such item, and any such Credit Extension in the absence of
a required item shall be made in Bank’s sole discretion. 
 (b) Borrower agrees to deliver to Bank as soon as possible, and in any event
within forty-five (45) days of the Effective date, a duly executed Bailee Agreement from Borrower’s manufacturer, MaxVision (the “MaxVision Agreement”. Borrower’s failure to deliver the MaxVision Agreement within such
forty-five (45) day period shall constitute an immediate Event of Default under the Loan Documents. 
 3.4 Procedures for
Borrowing. Subject to the prior satisfaction of all other applicable conditions to the making of an Advance set forth in this Agreement, to obtain an Advance (other than Advances under Sections 2.1.2 or 2.1.4), Borrower shall notify Bank (which
notice shall be irrevocable) by electronic mail, facsimile, or telephone by 12:00 p.m. Pacific time on the Funding Date of the Advance. Together with such notification, Borrower must promptly deliver to Bank by electronic mail or facsimile a
completed Transaction Report executed by a Responsible Officer or his or her designee. Bank shall credit Advances to the Designated Deposit Account. Bank may make Advances under this Agreement based on instructions from a Responsible Officer or his
or her designee or without instructions if the Advances are necessary to meet Obligations which have become due. Bank may rely on any telephone notice given by a person whom Bank believes is a Responsible Officer or designee. 
  

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	 	4	CREATION OF SECURITY INTEREST  

 4.1 Grant of Security Interest. Borrower hereby grants Bank, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Bank, the Collateral, wherever located, whether
now owned or hereafter acquired or arising, and all proceeds and products thereof. Borrower represents, warrants, and covenants that the security interest granted herein is and shall at all times continue to be a first priority perfected security
interest in the Collateral (subject only to Permitted Liens that may have superior priority to Bank’s Lien under this Agreement). If Borrower shall acquire a commercial tort claim, Borrower shall promptly notify Bank in a writing signed by
Borrower of the general details thereof and grant to Bank in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to Bank.

 If this Agreement is terminated, Bank’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity
obligations) are repaid in full in cash. Upon payment in full in cash of the Obligations and at such time as Bank’s obligation to make Credit Extensions has terminated, Bank shall, at Borrower’s sole cost and expense, release its Liens in
the Collateral and all rights therein shall revert to Borrower. 
 4.2 Authorization to File Financing Statements. Borrower hereby
authorizes Bank to file financing statements, without notice to Borrower, with all appropriate jurisdictions to perfect or protect Bank’s interest or rights hereunder, including a notice that any disposition of the Collateral, by either
Borrower or any other Person, shall be deemed to violate the rights of Bank under the Code. Such financing statements may indicate the Collateral as “all assets of the Debtor” or words of similar effect, or as being of an equal or lesser
scope, or with greater detail, all in Bank’s discretion. 
  

	 	5	REPRESENTATIONS AND WARRANTIES 

 Borrower
represents and warrants as follows: 
 5.1 Due Organization, Authorization; Power and Authority. Borrower is duly existing and in good
standing in its jurisdiction of formation and is qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of its business or its ownership of property requires that it be qualified except where the
failure to do so could not reasonably be expected to have a material adverse effect on Borrower’s business. In connection with this Agreement, Borrower has delivered to Bank a completed certificate signed by each Borrower, entitled
“Perfection Certificate”. Borrower represents and warrants to Bank that (a) Borrower’s exact legal name is that indicated on the Perfection Certificate and on the signature page hereof; (b) Borrower is an organization of the
type and is organized in the jurisdiction set forth in the Perfection Certificate; (c) the Perfection Certificate accurately sets forth Borrower’s organizational identification number or accurately states that Borrower has none;
(d) the Perfection Certificate accurately sets forth Borrower’s place of business, or, if more than one, its chief executive office as well as Borrower’s mailing address (if different than its chief executive office);
(e) Borrower (and each of its predecessors) has not, in the past five (5) years, changed its jurisdiction of formation, organizational structure or type, or any organizational number assigned by its jurisdiction; and (f) all other
information set forth on the Perfection Certificate pertaining to Borrower and each of its Subsidiaries is accurate and complete (it being understood and agreed that Borrower may from time to time update certain information in the Perfection
Certificate after the Effective Date to the extent permitted by one or more specific provisions in this Agreement). If Borrower is not now a Registered Organization but later becomes one, Borrower shall promptly notify Bank of such occurrence and
provide Bank with Borrower’s organizational identification number. 
 The execution, delivery and performance by Borrower of the Loan
Documents to which it is a party have been duly authorized, and do not (i) conflict with any of Borrower’s organizational documents, (ii) contravene, conflict with, constitute a default under or violate any material Requirement of
Law, (iii) contravene, conflict or violate any applicable order, writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or any its Subsidiaries or any of their property or assets may be bound
or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full force and
effect or (v) constitute an event of default under any material agreement by which Borrower is bound. Borrower is not in default under any agreement to which it is a party or by which it is bound in which the default could have a material
adverse effect on Borrower’s business. 
  

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 5.2 Collateral. Borrower has good title to, has rights in, and the power to transfer each item of
the Collateral upon which it purports to grant a Lien hereunder, free and clear of any and all Liens except Permitted Liens. Borrower has no deposit accounts other than the deposit accounts with Bank, the deposit accounts, if any, described in the
Perfection Certificate delivered to Bank in connection herewith, or of which Borrower has given Bank notice and taken such actions as are necessary to give Bank a perfected security interest therein. The Accounts are bona fide, existing obligations
of the Account Debtors. 
 The Collateral is not in the possession of any third party bailee (such as a warehouse) except as otherwise
provided in the Perfection Certificate. None of the components of the Collateral shall be maintained at locations other than as provided in the Perfection Certificate or as permitted pursuant to Section 7.2. In the event that Borrower, after
the date hereof, intends to store or otherwise deliver any portion of the Collateral to a bailee, then Borrower will first receive the written consent of Bank and such bailee must execute and deliver a bailee agreement in form and substance
satisfactory to Bank in its sole discretion. 
 All Inventory is in all material respects of good and marketable quality, free from material
defects. 
 Borrower is the sole owner of its intellectual property, except for non-exclusive licenses granted to its customers in the
ordinary course of business. Each patent is valid and enforceable and no part of the intellectual property has been judged invalid or unenforceable, in whole or in part, and to the best of Borrower’s knowledge, no claim has been made that any
part of the intellectual property violates the rights of any third party. Except as noted on the Perfection Certificate, Borrower is not a party to, nor is bound by, any material license or other agreement with respect to which Borrower is the
licensee (a) that prohibits or otherwise restricts Borrower from granting a security interest in Borrower’s interest in such license or agreement or any other property, or (b) for which a default under or termination of could
interfere with the Bank’s right to sell any Collateral. Borrower shall provide written notice to Bank within ten (10) days of entering or becoming bound by any such license or agreement (other than over-the-counter software that is
commercially available to the public). Borrower shall take such steps as Bank requests to obtain the consent of, or waiver by, any person whose consent or waiver is necessary for (x) all such licenses or agreements to be deemed
“Collateral” and for Bank to have a security interest in it that might otherwise be restricted or prohibited by law or by the terms of any such license or agreement, whether now existing or entered into in the future, and (y) Bank to
have the ability in the event of a liquidation of any Collateral to dispose of such Collateral in accordance with Bank’s rights and remedies under this Agreement and the other Loan Documents. 
 5.3 Accounts Receivable; Inventory. 
 (a) For each Account with respect to which Advances are requested, on the date each Advance is requested and made, such Account shall be an Eligible Account. 
 (b) All statements made and all unpaid balances appearing in all invoices, instruments and other documents evidencing the Eligible Accounts are and shall be true and correct and all such invoices, instruments and
other documents, and all of Borrower’s Books are genuine and in all respects what they purport to be. Whether or not an Event of Default has occurred and is continuing, Bank may notify any Account Debtor owing Borrower money of Bank’s
security interest in such funds and verify the amount of such Eligible Account. All sales and other transactions underlying or giving rise to each Eligible Account shall comply in all material respects with all applicable laws and governmental rules
and regulations. Borrower has no knowledge of any actual or imminent Insolvency Proceeding of any Account Debtor whose accounts are Eligible Accounts in any Transaction Report. To the best of Borrower’s knowledge, all signatures and
endorsements on all documents, instruments, and agreements relating to all Eligible Accounts are genuine, and all such documents, instruments and agreements are legally enforceable in accordance with their terms. 
 5.4 Litigation. There are no actions or proceedings pending or, to the knowledge of the Responsible Officers, threatened in writing by or against
Borrower or any of its Subsidiaries involving more than One Hundred Thousand and No/100 Dollars ($100,000). 
 5.5 No Material Deviation
in Financial Statements. All consolidated financial statements for Borrower and any of its Subsidiaries delivered to Bank fairly present in all material respects Borrower’s consolidated financial condition and Borrower’s consolidated
results of operations. There has not been any material deterioration in Borrower’s consolidated financial condition since the date of the most recent financial statements submitted to Bank. 
  

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 5.6 Solvency. The fair salable value of Borrower’s assets (including goodwill minus
disposition costs) exceeds the fair value of its liabilities; Borrower is not left with unreasonably small capital after the transactions in this Agreement; and Borrower is able to pay its debts (including trade debts) as they mature. 
 5.7 Regulatory Compliance. Borrower is not an “investment company” or a company “controlled” by an “investment
company” under the Investment Company Act of 1940, as amended. Borrower is not engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors). Borrower
has complied in all material respects with the Federal Fair Labor Standards Act. Neither Borrower nor any of its Subsidiaries is a “holding company” or an “affiliate” of a “holding company” or a “subsidiary
company” of a “holding company” as each term is defined and used in the Public Utility Holding Company Act of 2005. Borrower has not violated any laws, ordinances or rules, the violation of which could reasonably be expected to have a
material adverse effect on its business. None of Borrower’s or any of its Subsidiaries’ properties or assets has been used by Borrower or any Subsidiary or, to the best of Borrower’s knowledge, by previous Persons, in disposing,
producing, storing, treating, or transporting any hazardous substance other than legally. Borrower and each of its Subsidiaries have obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices
to, all Government Authorities that are necessary to continue their respective businesses as currently conducted. 
 5.8 Subsidiaries;
Investments. Borrower does not own any stock, partnership interest or other equity securities except for Permitted Investments. 
 5.9
Tax Returns and Payments; Pension Contributions. Borrower has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower.
Borrower may defer payment of any contested taxes, provided that Borrower (a) in good faith contests its obligation to pay the taxes by appropriate proceedings promptly and diligently instituted and conducted, (b) notifies Bank in writing
of the commencement of, and any material development in, the proceedings, (c) posts bonds or takes any other steps required to prevent the governmental authority levying such contested taxes from obtaining a Lien upon any of the Collateral that
is other than a “Permitted Lien”. Borrower is unaware of any claims or adjustments proposed for any of Borrower’s prior tax years which could result in additional taxes becoming due and payable by Borrower. Borrower has paid all
amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms, and Borrower has not withdrawn from participation in, and has not permitted partial or complete termination of, or
permitted the occurrence of any other event with respect to, any such plan which could reasonably be expected to result in any liability of Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other
governmental agency. 
 5.10 Use of Proceeds. Borrower shall use the proceeds of the Credit Extensions solely as working capital and
to fund its general business requirements and not for personal, family, household or agricultural purposes. 
 5.11 Full Disclosure.
No written representation, warranty or other statement of Borrower in any certificate or written statement given to Bank, as of the date such representation, warranty, or other statement was made, taken together with all such written certificates
and written statements given to Bank, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the certificates or statements not misleading (it being recognized by Bank that
the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the
projected or forecasted results). 
  

	 	6	AFFIRMATIVE COVENANTS 

 Borrower shall do all
of the following: 
 6.1 Government Compliance. 
 (a) Maintain its and all its Subsidiaries’ legal existence and good standing in their respective jurisdictions of formation and maintain qualification in each jurisdiction in which the failure to so qualify would

  

 -8- 

 
reasonably be expected to have a material adverse effect on Borrower’s business or operations. Borrower shall comply, and have each Subsidiary comply,
with all laws, ordinances and regulations to which it is subject, noncompliance with which could have a material adverse effect on Borrower’s business. 
 (b) Obtain all of the Governmental Approvals necessary for the performance by Borrower of its obligations under the Loan Documents to which it is a party and the grant of a security interest to Bank in all of its
property. Borrower shall promptly provide copies of any such obtained Governmental Approvals to Bank. 
 6.2 Financial Statements,
Reports, Certificates. 
 (a) Borrower shall provide Bank with the following: 
 (i) weekly, a Transaction Report (and any schedules related thereto); provided, that during any Streamline Period, such Transaction Report (and any
schedules related thereto) shall be provided within fifteen (15) days after the end of each month, rather than weekly; 
 (ii) within
fifteen (15) days after the end of each month, (A) monthly accounts receivable agings, aged by invoice date, (B) monthly accounts payable agings, aged by invoice date, and outstanding or held check registers, if any, and
(C) monthly reconciliations of accounts receivable agings (aged by invoice date), transaction reports and general ledger, 
 (iii) as
soon as available, and in any event within thirty (30) days after the end of each month, monthly unaudited financial statements; provided, that such monthly unaudited financial statement for the last month in each fiscal year shall be delivered
as soon as available, but in any event within sixty (60) days after the end of such month; 
 (iv) within thirty (30) days after
the end of each month a monthly Compliance Certificate signed by a Responsible Officer, certifying that as of the end of such month, Borrower was in full compliance with all of the terms and conditions of this Agreement, and setting forth
calculations showing compliance with the financial covenants set forth in this Agreement and such other information as Bank shall reasonably request, including, without limitation, a statement that at the end of such month there were no held checks;
and 
 (v) within fifteen (15) days following approval by Borrower’s board of directors, and in any event no later than fifteen
(15) of the end of each fiscal year, deliver to Bank financial projections and an annual budget for the upcoming fiscal year approved by Borrower’s board of directors. 
 (b) within five (5) days after filing, all reports on Form 10-K, 10-Q and 8-K filed with the Securities and Exchange Commission or a link thereto on
Borrower’s or another website on the Internet. 
 (c) Prompt written notice of (i) any material change in the composition of the
intellectual property, (ii) the registration of any copyright, including any subsequent ownership right of Borrower in or to any copyright, patent or trademark not previously disclosed in writing to Bank, or (iii) Borrower’s knowledge
of an event that materially adversely affects the value of the intellectual property. 
 6.3 Accounts Receivable. 
 (a) Schedules and Documents Relating to Accounts. Borrower shall deliver to Bank transaction reports and schedules of collections, as
provided in Section 6.2, on Bank’s standard forms; provided, however, that Borrower’s failure to execute and deliver the same shall not affect or limit Bank’s Lien and other rights in all of Borrower’s Accounts, nor shall
Bank’s failure to advance or lend against a specific Account affect or limit Bank’s Lien and other rights therein. If requested by Bank, Borrower shall furnish Bank with copies (or, at Bank’s request, originals) of all contracts,
orders, invoices, and other similar documents, and all shipping instructions, delivery receipts, bills of lading, and other evidence of delivery, for any goods the sale or disposition of which gave rise to such Accounts. In addition, Borrower shall
deliver to Bank, on its request, the originals of all instruments, chattel paper, security agreements, guarantees and other documents and property evidencing or securing any Accounts, in the same form as received, with all necessary indorsements,
and copies of all credit memos. 
  

 -9- 

 (b) Disputes. Borrower shall promptly notify Bank of all disputes or claims relating to Accounts.
Borrower may forgive (completely or partially), compromise, or settle any Account for less than payment in full, or agree to do any of the foregoing so long as (i) Borrower does so in good faith, in a commercially reasonable manner, in the
ordinary course of business, in arm’s-length transactions, and reports the same to Bank in the regular reports provided to Bank; (ii) no Default or Event of Default has occurred and is continuing; and (iii) after taking into account
all such discounts, settlements and forgiveness, the total outstanding Advances will not exceed the lesser of the Revolving Line or the Borrowing Base. 
 (c) Collection of Accounts. Borrower shall have the right to collect all Accounts, unless and until a Default or an Event of Default has occurred and is continuing. Whether or not an Event of Default has
occurred and is continuing, Borrower shall hold all payments on, and proceeds of, Accounts in trust for Bank, and Borrower shall immediately deliver all such payments and proceeds to Bank in their original form, duly endorsed, to be applied to the
Obligations pursuant to the terms of Section 9.4 hereof, except during any Streamline Period, in which case Borrower may apply such payments and proceeds as it determines. Bank may, in its good faith business judgment, require that all proceeds
of Accounts be deposited by Borrower into a lockbox account, or such other “blocked account” as Bank may specify, pursuant to a blocked account agreement in such form as Bank may specify in its good faith business judgment. 
 (d) Returns. Provided no Event of Default has occurred and is continuing, if any Account Debtor returns any Inventory to Borrower, Borrower
shall promptly (i) determine the reason for such return, (ii) issue a credit memorandum to the Account Debtor in the appropriate amount, and (iii) provide a copy of such credit memorandum to Bank, upon request from Bank. In the event
any attempted return occurs after the occurrence and during the continuance of any Event of Default, Borrower shall hold the returned Inventory in trust for Bank, and immediately notify Bank of the return of the Inventory. 
 (e) Verification. Bank may, from time to time, verify directly with the respective Account Debtors the validity, amount and other matters
relating to the Accounts, either in the name of Borrower or Bank or such other name as Bank may choose. 
 (f) No Liability.
Bank shall not be responsible or liable for any shortage or discrepancy in, damage to, or loss or destruction of, any goods, the sale or other disposition of which gives rise to an Account, or for any error, act, omission, or delay of any kind
occurring in the settlement, failure to settle, collection or failure to collect any Account, or for settling any Account in good faith for less than the full amount thereof, nor shall Bank be deemed to be responsible for any of Borrower’s
obligations under any contract or agreement giving rise to an Account. Nothing herein shall, however, relieve Bank from liability for its own gross negligence or willful misconduct. 
 6.4 Remittance of Proceeds. Except as otherwise provided in Section 6.3(c), deliver, in kind, all proceeds arising from the disposition of
any Collateral to Bank in the original form in which received by Borrower not later than the following Business Day after receipt by Borrower, to be applied to the Obligations pursuant to the terms of Section 9.4 hereof; provided that, if no
Default or Event of Default has occurred and is continuing, Borrower shall not be obligated to remit to Bank the proceeds of the sale of worn out or obsolete Equipment disposed of by Borrower in good faith in an arm’s length transaction for an
aggregate purchase price of $25,000 or less (for all such transactions in any fiscal year). Borrower agrees that it will not commingle proceeds of Collateral with any of Borrower’s other funds or property, but will hold such proceeds separate
and apart from such other funds and property and in an express trust for Bank. Nothing in this Section limits the restrictions on disposition of Collateral set forth elsewhere in this Agreement. 
 6.5 Taxes; Pensions. Timely file, and require each of its Subsidiaries to timely file, all required tax returns and reports and timely pay, and
require each of its Subsidiaries to timely file, all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower and each of its Subsidiaries, except for deferred payment of any taxes contested pursuant to the
terms of Section 5.9 hereof, and shall deliver to Bank, on demand, appropriate certificates attesting to such payments, and pay all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in
accordance with their terms. 
 6.6 Access to Collateral; Books and Records. At reasonable times, on one (1) Business 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 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 

  

 -10- 

 
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. 
 6.7 Insurance. Keep its business and the Collateral insured for risks and in amounts standard for companies in Borrower’s industry and
location and as Bank may reasonably request. Insurance policies shall be in a form, with companies, and in amounts that are satisfactory to Bank. All property policies shall have a lender’s loss payable endorsement showing Bank as lender loss
payee and waive subrogation against Bank, and all liability policies shall show, or have endorsements showing, Bank as an additional insured. All policies (or the loss payable and additional insured endorsements) shall provide that the insurer shall
endeavor to give Bank at least twenty (20) days notice before canceling, amending, or declining to renew its policy. At Bank’s request, Borrower shall deliver certified copies of policies and evidence of all premium payments. Proceeds
payable under any property policy shall, at Bank’s option, be payable to Bank on account of the Obligations. Notwithstanding the foregoing, (a) so long as no Event of Default has occurred and is continuing, Borrower shall have the option
of applying the proceeds of any casualty policy up to One Hundred Thousand Dollars ($100,000) in the aggregate for all losses under all casualty policies in any one year, toward the replacement or repair of destroyed or damaged property; provided
that any such replaced or repaired property (i) shall be of equal or like value as the replaced or repaired Collateral and (ii) shall be deemed Collateral in which Bank has been granted a first priority security interest, and
(b) after the occurrence and during the continuance of an Event of Default, all proceeds payable under such casualty policy shall, at the option of Bank, be payable to Bank on account of the Obligations. If Borrower fails to obtain insurance as
required under this Section 6.7 or to pay any amount or furnish any required proof of payment to third persons and Bank, Bank may make all or part of such payment or obtain such insurance policies required in this Section 6.7, and take any
action under the policies Bank deems prudent. 
 6.8 Operating Accounts. 
 (a) Maintain its and its Subsidiaries’ operating and other deposit accounts and securities accounts with Bank and Bank’s Affiliates,
which accounts shall represent at least 85% of the dollar value of Borrower’s and such Subsidiaries accounts at all financial institutions. 
 (b) Provide Bank five (5) days prior written notice before establishing any Collateral Account at or with any bank or financial institution other than Bank or Bank’s Affiliates. For each Collateral Account that Borrower at any
time maintains, Borrower shall cause the applicable bank or financial institution (other than Bank) at or with which any Collateral Account is maintained to execute and deliver a Control Agreement or other appropriate instrument with respect to such
Collateral Account to perfect Bank’s Lien in such Collateral Account in accordance with the terms hereunder. The provisions of the previous sentence shall not apply to deposit accounts exclusively used for payroll, payroll taxes and other
employee wage and benefit payments to or for the benefit of Borrower’s employees and identified to Bank by Borrower as such. 
 6.9
Financial Covenants. Borrower’s EBITDA, as tested as of the last day of each month for the three (3) month period then ending, shall not reflect a loss in excess of the following: 
  

				
	 Period
	  	Maximum
EBITDA
Loss
	 Effective Date through August 31, 2008
	  	$	2,500,000
		
	 September 1, 2008 through November 30, 2008
	  	$	1,800,000
		
	 December 1, 2008 through February 28, 2009
	  	$	2,200,000
		
	 March 1, 2009 through May 31, 2009
	  	$	1,700,000
		
	 June 1, 2009 and thereafter
	  	$	1,300,000

 Notwithstanding the foregoing, Borrower’s failure to satisfy the EBITDA financial covenant
set forth above shall not constitute an Event of Default hereunder if, as of the date of any calculation reflecting such failure to satisfy the applicable EBITDA financial covenant set forth above, Borrower maintains an Adjusted Quick Ratio greater
than or equal to 1.75:1.00. 
  

 -11- 

 6.10 Protection and Registration of Intellectual Property Rights. Borrower shall:
(a) protect, defend and maintain the validity and enforceability of its intellectual property; (b) promptly advise Bank in writing of material infringements of its intellectual property; and (c) not allow any intellectual property
material to Borrower’s business to be abandoned, forfeited or dedicated to the public without Bank’s written consent. If Borrower (i) obtains any patent, registered trademark or servicemark, registered copyright, registered mask work,
or any pending application for any of the foregoing, whether as owner, licensee or otherwise, or (ii) applies for any patent or the registration of any trademark or servicemark, then Borrower shall immediately provide written notice thereof to
Bank and shall execute such intellectual property security agreements and other documents and take such other actions as Bank shall request in its good faith business judgment to perfect and maintain a first priority perfected security interest in
favor of Bank in such property. If Borrower decides to register any copyrights or mask works in the United States Copyright Office, Borrower shall: (x) provide Bank with at least fifteen (15) days prior written notice of Borrower’s
intent to register such copyrights or mask works together with a copy of the application it intends to file with the United States Copyright Office (excluding exhibits thereto); (y) execute an intellectual property security agreement and such
other documents and take such other actions as Bank may request in its good faith business judgment to perfect and maintain a first priority perfected security interest in favor of Bank in the copyrights or mask works intended to be registered with
the United States Copyright Office; and (z) record such intellectual property security agreement with the United States Copyright Office contemporaneously with filing the copyright or mask work application(s) with the United States Copyright
Office. Borrower shall promptly provide to Bank copies of all applications that it files for patents or for the registration of trademarks, servicemarks, copyrights or mask works, together with evidence of the recording of the intellectual property
security agreement necessary for Bank to perfect and maintain a first priority perfected security interest in such property. 
 6.11
Litigation Cooperation. From the date hereof and continuing through the termination of this Agreement, make available to Bank, without expense to Bank, Borrower and its officers, employees and agents and Borrower’s books and records, to the
extent that Bank may deem them reasonably necessary to prosecute or defend any third-party suit or proceeding instituted by or against Bank with respect to any Collateral or relating to Borrower. 
 6.12 Further Assurances. Execute any further instruments and take further action as Bank reasonably requests to perfect or continue Bank’s
Lien in the Collateral or to effect the purposes of this Agreement. Deliver to Bank, within five (5) days after the same are sent or received, copies of all correspondence, reports, documents and other filings with any Governmental Authority
regarding compliance with or maintenance of Governmental Approvals or Requirements of Law or that could reasonably be expected to have a material effect on any of the Governmental Approvals or otherwise on the operations of Borrower or any of its
Subsidiaries. 
  

	 	7	NEGATIVE COVENANTS 

 Borrower shall not do
any of the following without Bank’s prior written consent: 
 7.1 Dispositions. Convey, sell, lease, transfer or otherwise dispose
of (collectively, “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, except for Transfers (a) of Inventory in the ordinary course of business; (b) of worn-out or
obsolete Equipment; (c) in connection with Permitted Liens and Permitted Investments; and (d) non-exclusive licenses for use of property in the ordinary course of business. 
 7.2 Changes in Business, Management, Ownership, or Business Locations. (a) Engage in or permit any of its Subsidiaries to engage in any
business other than the businesses currently engaged in by Borrower and such Subsidiary, as applicable, or reasonably related thereto; (b) liquidate or dissolve; or (c) (i) have a change in management or (ii) enter into any
transaction or series of related transactions in which the stockholders of Borrower who were not stockholders immediately prior to the first such transaction own more than 60% of the voting stock of Borrower immediately after giving effect to such
transaction or related series of such transactions (other than by the sale of Borrower’s equity securities in a public offering or to venture capital investors so long as Borrower identifies to Bank the venture capital investors prior to the
closing of the transaction). Borrower shall not, without at least thirty (30) days prior written notice to Bank: (1) add any new offices or business locations, including warehouses (unless such new offices or business locations contain
less than Fifty Thousand Dollars ($50,000) in Borrower’s assets or property), (2) change its jurisdiction of organization, (3) change its organizational structure or type, (4) change its legal name, or (5) change any
organizational number (if any) assigned by its jurisdiction of organization. 
  

 -12- 

 7.3 Mergers or Acquisitions. Merge or consolidate, or permit any of its Subsidiaries to merge or
consolidate, with any other Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of another Person. A Subsidiary may merge or consolidate into another Subsidiary or into
Borrower. 
 7.4 Indebtedness. Create, incur, assume, or be liable for any Indebtedness, or permit any Subsidiary to do so, other than
Permitted Indebtedness. 
 7.5 Encumbrance. Create, incur, allow, or suffer any Lien on any of its property, or assign or convey any
right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, except for Permitted Liens, permit any Collateral not to be subject to the first priority security interest granted herein. 
 7.6 Maintenance of Collateral Accounts. Maintain any Collateral Account except pursuant to the terms of Section 6.8.(b) hereof. 

7.7 Distributions; Investments. 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 stock of former employees or consultants pursuant to stock
repurchase agreements so long as an Event of Default does not exist at the time of such repurchase and would not exist after giving effect to such repurchase, provided such repurchase does not exceed in the aggregate of One Hundred Thousand Dollars
($100,000) per fiscal year; or (b) directly or indirectly make any Investment other than Permitted Investments, or permit any of its Subsidiaries to do so. 
 7.8 Transactions with Affiliates. Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower, except for transactions that are in the ordinary course of
Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm’s length transaction with a non-affiliated Person. 
 7.9 Subordinated Debt. (a) Make or permit any payment on any Subordinated Debt, except under the terms of the subordination, intercreditor,
or other similar agreement to which such Subordinated Debt is subject, or (b) amend any provision in any document relating to the Subordinated Debt which would increase the amount thereof or adversely affect the subordination thereof to
Obligations owed to Bank. 
 7.10 Compliance. Become an “investment company” or a company controlled by an “investment
company”, under the Investment Company Act of 1940, as amended, or undertake as one of its important activities extending credit to purchase or carry margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve
System), or use the proceeds of any Credit Extension for that purpose; fail to meet the minimum funding requirements of ERISA, permit a Reportable Event or Prohibited Transaction, as defined in ERISA, to occur; fail to comply with the Federal Fair
Labor Standards Act or violate any other law or regulation, if the violation could reasonably be expected to have a material adverse effect on Borrower’s business, or permit any of its Subsidiaries to do so; withdraw or permit any Subsidiary to
withdraw from participation in, permit partial or complete termination of, or permit the occurrence of any other event with respect to, any present pension, profit sharing and deferred compensation plan which could reasonably be expected to result
in any liability of Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other governmental agency. 
  

	 	8	EVENTS OF DEFAULT 

 Any one of the following
shall constitute an event of default (an “Event of Default”) under this Agreement: 
 8.1 Payment Default. Borrower
fails to (a) make any payment of principal or interest on any Credit Extension on its due date, or (b) pay any other Obligations within three (3) Business Days after such Obligations are 

  

 -13- 

 
due and payable (which three (3) day grace period shall not apply to payments due on the Revolving Line Maturity Date). During the cure period, the
failure to cure the payment default is not an Event of Default (but no Credit Extension will be made during the cure period); 
 8.2
Covenant Default. 
 (a) Borrower fails or neglects to perform any obligation in Sections 6.2, 6.8, 6.9 or violates any covenant in
Section 7; or 
 (b) Borrower fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or agreement
contained in this Agreement or any Loan Documents, and as to any default (other than those specified in this Section 8) under such other term, provision, condition, covenant or agreement that can be cured, has failed to cure the default within
ten (10) days after the occurrence thereof; provided, however, that if the default cannot by its nature be cured within the ten (10) day period or cannot after diligent attempts by Borrower be cured within such ten (10) day period,
and such default is likely to be cured within a reasonable time, then Borrower shall have an additional period (which shall not in any case exceed thirty (30) days) to attempt to cure such default, and within such reasonable time period the
failure to cure the default shall not be deemed an Event of Default (but no Credit Extensions shall be made during such cure period). Grace periods provided under this section shall not apply, among other things, to financial covenants or any other
covenants set forth in subsection (a) above; 
 8.3 Material Adverse Change. A Material Adverse Change occurs; 
 8.4 Attachment; Levy; Restraint on Business. (a) (i) The service of process seeking to attach, by trustee or similar process, any funds
of Borrower or of any entity under control of Borrower (including a Subsidiary) on deposit with Bank or any Bank Affiliate, or (ii) a notice of lien, levy, or assessment is filed against any of Borrower’s assets by any government agency,
and the same under subclauses (i) and (ii) hereof are not, within ten (10) days after the occurrence thereof, discharged or stayed (whether through the posting of a bond or otherwise); provided, however, no Credit Extensions shall be
made during any ten (10) day cure period; and (b) (i) any material portion of Borrower’s assets is attached, seized, levied on, or comes into possession of a trustee or receiver, or (ii) any court order enjoins, restrains,
or prevents Borrower from conducting any part of its business; 
 8.5 Insolvency. (a) Borrower is unable to pay its debts
(including trade debts) as they become due or otherwise becomes insolvent; (b) Borrower begins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against Borrower and not dismissed or stayed within forty-five (45) days
(but no Credit Extensions shall be made while of any of the conditions described in clause (a) exist and/or until any Insolvency Proceeding is dismissed); 
 8.6 Other Agreements. There is a default in any agreement to which Borrower or any Guarantor 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 One Hundred Thousand Dollars ($100,000) or that could have a material adverse effect on Borrower’s or any Guarantor’s business; 
 8.7 Judgments. One or more judgments, orders, or decrees for the payment of money in an amount, individually or in the aggregate, of at least One
Hundred Thousand Dollars ($100,000)(not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against Borrower and shall remain unsatisfied, unvacated, or unstayed for a
period of ten (10) days after the entry thereof (provided that no Credit Extensions will be made prior to the satisfaction, vacation, or stay of such judgment, order, or decree); 
 8.8 Misrepresentations. Borrower or any Person acting for Borrower makes any representation, warranty, or other statement now or later in this
Agreement, any Loan Document or in any writing delivered to Bank or to induce Bank to enter this Agreement or any Loan Document, and such representation, warranty, or other statement is incorrect in any material respect when made; 
 8.9 Subordinated Debt. A default or breach occurs under any agreement between Borrower and any creditor of Borrower that signed a subordination,
intercreditor, or other similar agreement with Bank, or any creditor that has signed such an agreement with Bank breaches any terms of such agreement; or 
  

 -14- 

	 	9	BANK’S RIGHTS AND REMEDIES 

 9.1
Rights and Remedies. While an Event of Default occurs and continues Bank may, without notice or demand, do any or all of the following: 
 (a) declare all Obligations immediately due and payable (but if an Event of Default described in Section 8.5 occurs all Obligations are immediately due and payable without any action by Bank); 
 (b) stop advancing money or extending credit for Borrower’s benefit under this Agreement or under any other agreement between Borrower and Bank;

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

 9.2 Power of Attorney. Borrower hereby irrevocably appoints Bank as its lawful attorney-in-fact, exercisable upon the occurrence
and during the continuance of an Event of Default, to: (a) endorse Borrower’s name on any checks or other forms of payment or security; (b) sign Borrower’s name on any invoice or bill of lading for any Account or drafts against
Account Debtors; (c) settle and adjust disputes and claims about the Accounts directly with Account Debtors, for amounts and on terms Bank determines reasonable; (d) make, settle, and adjust all claims under Borrower’s insurance
policies; (e) pay, contest or settle any Lien, charge, encumbrance, security interest, and adverse claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; and
(f) transfer the Collateral into the name of Bank or a third party as the Code permits. Borrower hereby appoints Bank as its lawful attorney-in-fact to sign Borrower’s name on any documents necessary to perfect or continue the perfection
of Bank’s security interest in the Collateral regardless of whether an Event of Default has occurred until all Obligations have been satisfied in full and Bank is under no further obligation 

  

 -15- 

 
to make Credit Extensions hereunder. Bank’s foregoing appointment as Borrower’s attorney in fact, and all of Bank’s rights and powers, coupled
with an interest, are irrevocable until all Obligations have been fully repaid and performed and Bank’s obligation to provide Credit Extensions terminates. 
 9.3 Protective Payments. If Borrower fails to obtain the insurance called for by Section 6.7 or fails to pay any premium thereon or fails to pay any other amount which Borrower is obligated to pay under
this Agreement or any other Loan Document, Bank may obtain such insurance or make such payment, and all amounts so paid by Bank are Bank Expenses and immediately due and payable, bearing interest at the then highest applicable rate, and secured by
the Collateral. Bank will make reasonable efforts to provide Borrower with notice of Bank obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Bank are deemed an agreement to make similar
payments in the future or Bank’s waiver of any Event of Default. 
 9.4 Application of Payments and Proceeds. Borrower shall have
no right to specify the order or the accounts to which Bank shall allocate or apply any payments required to be made by Borrower to Bank or otherwise received by Bank under this Agreement when any such allocation or application is not specified
elsewhere in this Agreement. If an Event of Default has occurred and is continuing, Bank may apply any funds in its possession, whether from Borrower account balances, payments, proceeds realized as the result of any collection of Accounts or other
disposition of the Collateral, or otherwise, to the Obligations in such order as Bank shall determine in its sole discretion. Any surplus shall be paid to Borrower by credit to the Designated Deposit Account or to other Persons legally entitled
thereto; Borrower shall remain liable to Bank for any deficiency. If Bank, in its good faith business judgment, directly or indirectly enters into a deferred payment or other credit transaction with any purchaser at any sale of Collateral, Bank
shall have the option, exercisable at any time, of either reducing the Obligations by the principal amount of the purchase price or deferring the reduction of the Obligations until the actual receipt by Bank of cash therefor. 
 9.5 Bank’s Liability for Collateral. So long as Bank complies with reasonable banking practices regarding the safekeeping of the Collateral
in the possession or under the control of Bank, Bank shall not be liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage to the Collateral; (c) any diminution in the value of the Collateral; or
(d) any act or default of any carrier, warehouseman, bailee, or other Person. Borrower bears all risk of loss, damage or destruction of the Collateral. 
 9.6 No Waiver; Remedies Cumulative. Bank’s failure, at any time or times, to require strict performance by Borrower of any provision of this Agreement or any other Loan Document shall not waive, affect, or
diminish any right of Bank thereafter to demand strict performance and compliance herewith or therewith. No waiver hereunder shall be effective unless signed by Bank and then is only effective for the specific instance and purpose for which it is
given. Bank’s rights and remedies under this Agreement and the other Loan Documents are cumulative. Bank has all rights and remedies provided under the Code, by law, or in equity. Bank’s exercise of one right or remedy is not an election,
and Bank’s waiver of any Event of Default is not a continuing waiver. Bank’s delay in exercising any remedy is not a waiver, election, or acquiescence. 
 9.7 Demand Waiver. Borrower waives demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal
of accounts, documents, instruments, chattel paper, and guarantees held by Bank on which Borrower is liable. 
  

	 	10	NOTICES 

 10.1 Notices. All notices,
consents, requests, approvals, demands, or other communication (collectively, “Communication”) by any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or
delivered: (a) upon the earlier of actual receipt and three (3) Business Days after deposit in the U.S. mail, first class, registered or certified mail return receipt requested, with proper postage prepaid; (b) upon transmission, when
sent by electronic mail or facsimile transmission; (c) one (1) Business Day after deposit with a reputable overnight courier with all charges prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be
addressed to the party to be notified and sent to the address, facsimile number, or email address indicated below. Bank or Borrowers may change its address or facsimile number by giving the other party written notice thereof in accordance with the
terms of this Section 10. 
  

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	If to Borrower:	  	 Sonic Foundry, Inc.
 Sonic Foundry Media Systems, Inc.

 222 W. Washington Avenue
 Madison, Wisconsin 53703

Attn: Mr. Kenneth Minor
 Fax: (608) 443-1609
 Email: kenm@sonicfoundry.com

		
	If to Bank:	  	 Silicon Valley Bank
 380 Interlocken Crescent, Suite
600
 Broomfield, CO 80021
 Attn: Mr. Adam Glick

Fax: (303) 469-9088
 Email: aglick@svb.com

 10.2 Subrogation and Similar Rights. Notwithstanding any other provision of this Agreement
or any other document related to this Agreement, until payment to Bank in full and performance of all Obligations, each Borrower irrevocably waives all rights that it may have at law or in equity (including, without limitation, any law subrogating
the Borrower to the rights of Bank under this Agreement) to seek contribution, indemnification, or any other form of reimbursement from any other Borrower, or any other entity now or hereafter primarily or secondarily liable for any of the
Obligations, for any payment made by the Borrower with respect to the Obligations in connection with this Agreement or otherwise and all rights that it might have to benefit from, or to participate in, any security for the Obligations as a result of
any payment made by the Borrower with respect to the Obligations in connection with this Agreement or otherwise. Any agreement providing for indemnification, reimbursement or any other arrangement prohibited under this Section 10.2 shall
be null and void. If any payment is made to a Borrower in contravention of this Section 10.2, such Borrower shall hold such payment in trust for Bank and such payment shall be promptly delivered to Bank for application to the
Obligations, whether matured or unmatured. 
 10.3 Waivers of Notice. Each Borrower waives notice of acceptance hereof; notice of the
existence, creation or acquisition of any of the Obligations; notice of an Event of Default; notice of the amount of the Obligations outstanding at any time; notice of intent to accelerate; notice of acceleration; notice of any adverse change in the
financial condition of any other Borrower or of any other fact that might increase the Borrowers’ risk; presentment for payment; demand; protest and notice thereof as to any instrument; default; and all other notices and demands to which the
Borrower would otherwise be entitled. Each Borrower waives any defense arising from any defense of any other Borrower, or by reason of the cessation from any cause whatsoever of the liability of any other Borrower. Bank’s failure at any time to
require strict performance by any Borrower of any provision of this Agreement shall not waive, alter or diminish any right of Bank thereafter to demand strict compliance and performance therewith. Nothing contained herein shall prevent Bank from
foreclosing on the lien of any deed of trust, mortgage or other security instrument, or exercising any rights available thereunder, and the exercise of any such rights shall not constitute a legal or equitable discharge of any Borrower. Each
Borrower also waives any defense arising from any act or omission of Bank that changes the scope of the Borrowers’ risks hereunder. Each Borrower hereby waives any right to assert against Bank any defense (legal or equitable), setoff,
counterclaim, or claims that such Borrower individually may now or hereafter have against another Borrower or any other entity liable to Borrower with respect to the Obligations in any manner or whatsoever until the Obligations are paid in full to
Bank. 
 10.4 Subrogation Defenses. Each Borrower waives the benefits, if any, of any statutory or common law rule that may permit a
borrower to assert any defenses of a surety or guarantor, or that may give a borrower the right to require a senior creditor to marshal assets, and Borrower agrees that it shall not assert any such defenses or rights. 
 10.5 Right to Settle, Release. 
 (a)
The liability of Borrower hereunder shall not be diminished by (i) any agreement, understanding or representation that any of the Obligations is or was to be guaranteed by another entity or secured by other property, or (ii) any release or
unenforceability, whether partial or total, or rights, if any, which Borrower may now or hereafter have against any other entity, including another Borrower, or property with respect to any of the Obligations. 
  

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 (b) Without notice to any Borrower and without affecting the liability of any Borrower hereunder, Bank
may (i) compromise, settle, renew, extend the time for payment, change the manner or terms of payment, discharge the performance of, decline to enforce, or release all or any of the Obligations with respect to a Borrower, (ii) grant other
indulgences to a Borrower in respect of the Obligations, (iii) modify in any manner any documents, relating to the Obligations with respect to a Borrower, (iv) release, surrender or exchange any deposits or other property securing the
Obligations, whether pledged by a Borrower or any other entity, or (v) compromise, settle renew, or extend the time for payment, discharge the performance of, decline to enforce, or release all or any obligations of any guarantor, endorser or
other entity who is now or may hereafter be liable with respect to any of the Obligations. 
  

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

 California law governs the Loan Documents without regard to principles of conflicts of law. Borrower and Bank each submit to the exclusive jurisdiction of the State and Federal courts in Santa Clara County,
California; provided, however, that nothing in this Agreement shall be deemed to operate to preclude Bank from bringing suit or taking other legal action in any other jurisdiction to realize on the Collateral or any other security for the
Obligations, or to enforce a judgment or other court order in favor of Bank. Borrower expressly submits and consents in advance to such jurisdiction in any action or suit commenced in any such court, and Borrower hereby waives any objection that it
may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consents to the granting of such legal or equitable relief as is deemed appropriate by such court. Borrower hereby waives personal service of the
summons, complaints, and other process issued in such action or suit and agrees that service of such summons, complaints, and other process may be made by registered or certified mail addressed to Borrower at the address set forth in Section 10
of this Agreement and that service so made shall be deemed completed upon the earlier to occur of Borrower’s actual receipt thereof or three (3) days after deposit in the U.S. mails, proper postage prepaid. 
 TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND BANK EACH WAIVE THEIR RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING
OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A MATERIAL INDUCEMENT FOR BOTH PARTIES TO ENTER INTO THIS AGREEMENT. EACH PARTY
HAS REVIEWED THIS WAIVER WITH ITS COUNSEL. 
 WITHOUT INTENDING IN ANY WAY TO LIMIT THE PARTIES’ AGREEMENT TO WAIVE THEIR RESPECTIVE
RIGHT TO A TRIAL BY JURY, if the above waiver of the right to a trial by jury is not enforceable, the parties hereto agree that any and all disputes or controversies of any nature between them arising at any time shall be decided by a reference to a
private judge, mutually selected by the parties (or, if they cannot agree, by the Presiding Judge of the Santa Clara County, California Superior Court) appointed in accordance with California Code of Civil Procedure Section 638 (or pursuant to
comparable provisions of federal law if the dispute falls within the exclusive jurisdiction of the federal courts), sitting without a jury, in Santa Clara County, California; and the parties hereby submit to the jurisdiction of such court. The
reference proceedings shall be conducted pursuant to and in accordance with the provisions of California Code of Civil Procedure §§ 638 through 645.1, inclusive. The private judge shall have the power, among others, to grant provisional
relief, including without limitation, entering temporary restraining orders, issuing preliminary and permanent injunctions and appointing receivers. All such proceedings shall be closed to the public and confidential and all records relating thereto
shall be permanently sealed. If during the course of any dispute, a party desires to seek provisional relief, but a judge has not been appointed at that point pursuant to the judicial reference procedures, then such party may apply to the Santa
Clara County, California Superior Court for such relief. The proceeding before the private judge shall be conducted in the same manner as it would be before a court under the rules of evidence applicable to judicial proceedings. The parties shall be
entitled to discovery which shall be conducted in the same manner as it would be before a court under the rules of discovery applicable to judicial proceedings. The private judge shall oversee discovery and may enforce all discovery rules and order
applicable to judicial proceedings in the same manner as a trial court judge. The parties agree that the selected or appointed private judge shall have the power to decide all issues in the action or proceeding, whether of fact or of law, and shall
report a statement of decision thereon pursuant to the California Code of Civil Procedure § 644(a). Nothing in this paragraph shall limit the right of any party at any time to exercise self-help remedies, foreclose against collateral, or obtain
provisional remedies. The private judge shall also determine all issues relating to the applicability, interpretation, and enforceability of this paragraph. 
  

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	 	12	GENERAL PROVISIONS 

 12.1 Termination
Prior to Revolving Line Maturity Date. This Agreement may be terminated prior to the Revolving Line Maturity Date by Borrower, effective three (3) Business Days after written notice of termination is given to Bank. Notwithstanding any such
termination, Bank’s lien and security interest in the Collateral shall continue until Borrower fully satisfies its Obligations. If such termination is at Borrower’s election or at Bank’s election due to the occurrence and continuance
of an Event of Default, Borrower shall pay to Bank, in addition to the payment of any other expenses or fees then-owing, a termination fee in an amount equal to one and one half percent (1.50%) of the Revolving Line, if such termination occurs
on or prior to the first anniversary of the Effective Date, or one half of one percent (0.50%) of the Revolving Line, if such termination occurs following the first anniversary of the Effective Date (the “Termination Fee”); provided
that no Termination Fee shall be charged if the credit facility hereunder is replaced with a new facility from another division of Silicon Valley Bank. 
 12.2 Successors and Assigns. This Agreement binds and is for the benefit of the successors and permitted assigns of each party. Borrower may not assign this Agreement or any rights or obligations under it
without Bank’s prior written consent (which may be granted or withheld in Bank’s discretion). Bank has the right, without the consent of or notice to Borrower, to sell, transfer, negotiate, or grant participation in all or any part of, or
any interest in, Bank’s obligations, rights, and benefits under this Agreement and the other Loan Documents. 
 12.3
Indemnification. Borrower agrees to indemnify, defend and hold Bank and its directors, officers, employees, agents, attorneys, or any other Person affiliated with or representing Bank (each, an “Indemnified Person”) harmless
against: (a) all obligations, demands, claims, and liabilities (collectively, “Claims”) asserted by any other party in connection with the transactions contemplated by the Loan Documents; and (b) all losses or Bank
Expenses incurred, or paid by such Indemnified Person from, following, or arising from transactions between Bank and Borrower (including reasonable attorneys’ fees and expenses), except for Claims and/or losses directly caused by such
Indemnified Person’s gross negligence or willful misconduct. 
 12.4 Time of Essence. Time is of the essence for the performance
of all Obligations in this Agreement. 
 12.5 Severability of Provisions. Each provision of this Agreement is severable from every
other provision in determining the enforceability of any provision. 
 12.6 Correction of Loan Documents. Bank may correct patent
errors and fill in any blanks in this Agreement and the other Loan Documents consistent with the agreement of the parties. 
 12.7
Amendments in Writing; Integration. All amendments to this Agreement must be in writing and signed by both Bank and Borrower. This Agreement 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 Agreement and the Loan Documents merge into this Agreement and the Loan Documents.

 12.8 Counterparts. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts,
each of which, when executed and delivered, are an original, and all taken together, constitute one Agreement. 
 12.9 Survival. All
covenants, representations and warranties made in this Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations (other than inchoate indemnity obligations and any other obligations which, by
their terms, are to survive the termination of this Agreement) have been satisfied. The obligation of Borrower in Section 12.2 to indemnify Bank shall survive until the statute of limitations with respect to such claim or cause of action
shall have run. 
 12.10 Confidentiality. In handling any confidential information, Bank shall exercise the same degree of care that
it exercises for its own proprietary information, but disclosure of information may be made: (a) to Bank’s Subsidiaries or Affiliates; (b) to prospective transferees or purchasers of any interest in the Credit Extensions (provided,
however, Bank shall use commercially reasonable efforts to obtain such prospective transferee’s or purchaser’s agreement to the terms of this provision); (c) as required by law, regulation, subpoena, or other order; (d) to
Bank’s regulators or as otherwise required in connection with Bank’s examination or audit; (e) as Bank considers appropriate in exercising remedies under the Loan Documents; and (f) to third-party service providers of Bank so
long as such service providers have executed a confidentiality agreement with Bank with terms no less restrictive than those contained herein. Confidential information does not include information that either: (i) is in 

  

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the public domain or in Bank’s possession when disclosed to Bank, or becomes part of the public domain after disclosure to Bank; or (ii) is
disclosed to Bank by a third party, if Bank does not know that the third party is prohibited from disclosing the information. 
 Bank may use
confidential information for any purpose, including, without limitation, for the development of client databases, reporting purposes, and market analysis, so long as Bank does not disclose Borrower’s identity or the identity of any person
associated with Borrower unless otherwise expressly permitted by this Agreement. The provisions of the immediately preceding sentence shall survive the termination of this Agreement. 
 12.11 Attorneys’ Fees, Costs and Expenses. In any action or proceeding between Borrower and Bank arising out of or relating to the Loan
Documents, the prevailing party shall be entitled to recover its reasonable attorneys’ fees and other costs and expenses incurred, in addition to any other relief to which it may be entitled. 
  

	 	13	DEFINITIONS 

 13.1 Definitions. As
used in this Agreement, the following terms have the following meanings: 
 “Account” is any “account” as defined
in the Code with such additions to such term as may hereafter be made, and includes, without limitation, all accounts receivable and other sums owing to Borrower. 
 “Account Debtor” is any “account debtor” as defined in the Code with such additions to such term as may hereafter be made. 
 “Adjusted Quick Ratio” is a ratio of (a) Quick Assets to (b) Current Liabilities, less Deferred Revenues, plus the amount of
the Obligations. 
 “Advance” or “Advances” means an advance (or advances) under the Revolving Line.

 “Affiliate” of any Person is a Person that owns or controls directly or indirectly the Person, any Person that controls
or is controlled by or is under common control with the Person, and each of that Person’s senior executive officers, directors, partners and, for any Person that is a limited liability company, that Person’s managers and members.

 “Agreement” is defined in the preamble hereof. 
 “Availability Amount” is (a) the lesser of (i) the Revolving Line or (ii) the amount available under the Borrowing Base
minus (b) the amount of all outstanding Letters of Credit (including drawn but unreimbursed Letters of Credit) plus an amount equal to the Letter of Credit Reserve, minus (c) the FX Reserve, minus (d) without duplication, any other
amounts used under the Other Services Sublimit, minus (e) the Term Loan Balance Reserve, if applicable, and minus (f) the outstanding principal balance of any Advances. 
 “Bailee Agreement” is a bailee agreement in form and substance satisfactory to Bank in its sole discretion. 
 “Bank” is defined in the preamble hereof. 
 “Bank Expenses” are all audit fees and expenses, costs, and expenses (including reasonable attorneys’ fees and expenses) for preparing, amending, negotiating, administering, defending and
enforcing the Loan Documents (including, without limitation, those incurred in connection with appeals or Insolvency Proceedings) or otherwise incurred with respect to Borrower. 
 “Bankruptcy-Related Defaults” is defined in Section 9.1. 
 “Borrower” is defined in the preamble hereof 
 “Borrower’s Books” are all Borrower’s books and records including ledgers, federal and state tax returns, records regarding Borrower’s assets or liabilities, the Collateral, business
operations or financial condition, and all computer programs or storage or any equipment containing such information. 
  

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 “Borrowing Base” is seventy-five (75%) of Eligible Accounts, as determined by Bank
from Borrower’s most recent Transaction Report; provided, however, that Bank may decrease the foregoing percentages in its good faith business judgment based on events, conditions, contingencies, or risks which, as determined by Bank, may
adversely affect Collateral. 
 “Borrowing Resolutions” are, with respect to any Person, those resolutions
substantially in the form attached hereto as Exhibit     . 
 “Business Day” is any
day that is not a Saturday, Sunday or a day on which Bank is closed. 
 “Cash Equivalents” means (a) marketable direct
obligations issued or unconditionally guaranteed by the United States or any agency or any State thereof having maturities of not more than one (1) year from the date of acquisition; (b) commercial paper maturing no more than one
(1) year after its creation and having the highest rating from either Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc.; (c) Bank’s certificates of deposit issued maturing no more than one
(1) year after issue. 
 “Cash Management Services” is defined in Section 2.1.4. 
 “Code” is the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the State of California;
provided, that, to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently in different Articles or Divisions of the Code, the definition of such term contained in Article or Division 9
shall govern; provided further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, or priority of, or remedies with respect to, Bank’s Lien on any Collateral is governed by the Uniform
Commercial Code in effect in a jurisdiction other than the State of California, the term “Code” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes on the provisions thereof
relating to such attachment, perfection, priority, or remedies and for purposes of definitions relating to such provisions. 
 “Collateral” is any and all properties, rights and assets of Borrower described on Exhibit A. 
 “Collateral Account” is any Deposit Account, Securities Account, or Commodity Account. 
 “Committed
Availability” means, as the date of determination, an amount equal to the Revolving Line minus all outstanding Credit Extensions. 
 “Commodity Account” is any “commodity account” as defined in the Code with such additions to such term as may hereafter be made. 
 “Compliance Certificate” is that certain certificate in the form attached hereto as Exhibit B. 
 “Contingent Obligation” is, for any Person, any direct or indirect liability, contingent or not, of that Person for (a) any indebtedness, lease, dividend, letter of credit or other obligation of
another such as an obligation directly or indirectly guaranteed, endorsed, co-made, discounted or sold with recourse by that Person, or for which that Person is directly or indirectly liable; (b) any obligations for undrawn letters of credit
for the account of that Person; and (c) all obligations from any interest rate, currency or commodity swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in
interest rates, currency exchange rates or commodity prices; but “Contingent Obligation” does not include endorsements in the ordinary course of business. The amount of a Contingent Obligation is the stated or determined amount of the
primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under
any guarantee or other support arrangement. 
 “Control Agreement” is any control agreement entered into among the
depository institution at which Borrower maintains a Deposit Account or the securities intermediary or commodity intermediary at which Borrower maintains a Securities Account or a Commodity Account, Borrower, and Bank pursuant to which Bank obtains
control (within the meaning of the Code) over such Deposit Account, Securities Account, or Commodity Account. 
 “Credit
Extension” is any Advance, Letter of Credit, FX Forward Contract, amount utilized for Cash Management Services, the Existing Term Loan, or any other extension of credit by Bank for Borrower’s benefit. 
  

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 “Current Liabilities” are all obligations and liabilities of Borrower to Bank, plus,
without duplication, the aggregate amount of Borrower’s Total Liabilities that mature within one (1) year. 
 “Default
Rate” is defined in Section 2.4(b). 
 “Deferred Revenue” is all amounts received or invoiced in
advance of performance under contracts and not yet recognized as revenue. 
 “Deposit Account” is any “deposit
account” as defined in the Code with such additions to such term as may hereafter be made. 
 “Designated Deposit
Account” is Borrower’s deposit account, account number 3300556589, maintained with Bank. 
 “Dollars,”
“dollars” and “$” each mean lawful money of the United States. 
 “EBITDA” shall mean
(a) Net Income, plus (b) Interest Expense, plus (c) to the extent deducted in the calculation of Net Income, depreciation expense and amortization expense, plus (d) income tax expense, plus (e) non-cash stock compensation
expense, plus (f) other expenses which are both non-cash and non-recurring, and minus (g) all non-cash, non-recurring income. 
 “Effective Date” is the date Bank executes this Agreement as indicated on the signature page hereof. 
 “Eligible Accounts” means Accounts which arise in the ordinary course of Borrower’s business that meet all Borrower’s representations and warranties in Section 5.3. Bank reserves the right at any time after
the Effective Date to adjust any of the criteria set forth below and to establish new criteria in its good faith business judgment. Eligible Accounts shall not include: 
 (a) Accounts that the Account Debtor has not paid within ninety (90) days of invoice date regardless of invoice payment period terms; 
 (b) Accounts owing from an Account Debtor, fifty percent (50%) or more of whose Accounts have not been paid within ninety (90) days of invoice date; 
 (c) Accounts billed in the United States and owing from an Account Debtor which does not have its principal place of business in the United States or
Canada unless such Accounts are otherwise Eligible Accounts and (i) covered in full by credit insurance satisfactory to Bank, less any deductible, (ii) supported by letter(s) of credit acceptable to Bank, (iii) supported by a guaranty
from the Export-Import Bank of the United States, or (iv) that Bank otherwise approves of in writing; 
 (d) Accounts billed and payable
outside of the United States unless the Bank has a first priority, perfected security interest or other enforceable Lien in such Accounts; 
 (e) Accounts owing from an Account Debtor to the extent that Borrower is indebted or obligated in any manner to the Account Debtor (as creditor, lessor, supplier or otherwise—sometimes called “contra” accounts, accounts
payable, customer deposits or credit accounts), with the exception of customary credits, adjustments and/or discounts given to an Account Debtor by Borrower in the ordinary course of its business; 
 (f) Accounts for which the Account Debtor is Borrower’s Affiliate, officer, employee, or agent; 
 (g) Accounts with credit balances over ninety (90) days from invoice date; 
 (h) Accounts owing from an Account Debtor, including Affiliates, whose total obligations to Borrower exceed twenty-five (25%) of all Accounts,
except for Synnex Corporation, for which such percentage is 50% for the amounts that exceed that percentage, unless Bank approves in writing; 
 (i) Accounts owing from an Account Debtor which is a United States government entity or any department, agency, or instrumentality thereof unless Borrower has assigned its payment rights to Bank and the assignment has been acknowledged
under the Federal Assignment of Claims Act of 1940, as amended; 
  

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 (j) Accounts for demonstration or promotional equipment, or in which goods are consigned, or sold on a
“sale guaranteed”, “sale or return”, “sale on approval”, or other terms if Account Debtor’s payment may be conditional; 
 (k) Accounts owing from an Account Debtor that has not been invoiced or where goods or services have not yet been rendered to the Account Debtor (sometimes called memo billings or pre-billings); 
 (l) Accounts subject to contractual arrangements between Borrower and an Account Debtor where payments shall be scheduled or due according to completion
or fulfillment requirements where the Account Debtor has a right of offset for damages suffered as a result of Borrower’s failure to perform in accordance with the contract (sometimes called contracts accounts receivable, progress billings,
milestone billings, or fulfillment contracts); 
 (m) Accounts owing from an Account Debtor the amount of which may be subject to withholding
based on the Account Debtor’s satisfaction of Borrower’s complete performance (but only to the extent of the amount withheld; sometimes called retainage billings); 
 (n) Accounts subject to trust provisions, subrogation rights of a bonding company, or a statutory trust; 
 (o) Accounts owing from an Account Debtor that has been invoiced for goods that have not been shipped to the Account Debtor unless Bank, Borrower, and
the Account Debtor have entered into an agreement acceptable to Bank in its sole discretion wherein the Account Debtor acknowledges that (i) it has title to and has ownership of the goods wherever located, (ii) a bona fide sale of the
goods has occurred, and (iii) it owes payment for such goods in accordance with invoices from Borrower (sometimes called “bill and hold” accounts); 
 (p) Accounts for which the Account Debtor has not been invoiced; 
 (q) Accounts that represent non-trade
receivables or that are derived by means other than in the ordinary course of Borrower’s business; 
 (r) Accounts for which Borrower
has permitted Account Debtor’s payment to extend beyond 90 days; 
 (s) Accounts subject to chargebacks or others payment deductions
taken by an Account Debtor (but only to the extent the chargeback is determined invalid and subsequently collected by Borrower); 
 (t)
Accounts in which the Account Debtor disputes liability or makes any claim (but only up to the disputed or claimed amount), or if the Account Debtor is subject to an Insolvency Proceeding, or becomes insolvent, or goes out of business; and

 (u) Accounts for which Bank in its good faith business judgment determines collection to be doubtful. 
 “Equipment” is all “equipment” as defined in the Code with such additions to such term as may hereafter be made, and includes
without limitation all machinery, fixtures, goods, vehicles (including motor vehicles and trailers), and any interest in any of the foregoing. 
 “ERISA” is the Employee Retirement Income Security Act of 1974, and its regulations. 
 “Event of
Default” is defined in Section 8. 
 “Foreign Currency” means lawful money of a country other than the United
States. 
 “Funding Date” is any date on which a Credit Extension is made to or on account of Borrower which shall be
a Business Day. 
 “FX Business Day” is any day when (a) Bank’s Foreign Exchange Department is
conducting its normal business and (b) the Foreign Currency being purchased or sold by Borrower is available to Bank from the entity from which Bank shall buy or sell such Foreign Currency. 
 “FX Forward Contract” is defined in Section 2.1.3. 
  

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 “FX Reduction Amount” is defined in Section 2.1.3. 
 “FX Reserve” is defined in Section 2.1.3. 
 “GAAP” is generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other Person as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the
date of determination. 
 “General Intangibles” is all “general intangibles” as defined in the Code in effect on
the date hereof with such additions to such term as may hereafter be made, and includes without limitation, all copyright rights, copyright applications, copyright registrations and like protections in each work of authorship and derivative work,
whether published or unpublished, any patents, trademarks, service marks and, to the extent permitted under applicable law, any applications therefor, whether registered or not, any trade secret rights, including any rights to unpatented inventions,
payment intangibles, royalties, contract rights, goodwill, franchise agreements, purchase orders, customer lists, route lists, telephone numbers, domain names, claims, income and other tax refunds, security and other deposits, options to purchase or
sell real or personal property, rights in all litigation presently or hereafter pending (whether in contract, tort or otherwise), insurance policies (including without limitation key man, property damage, and business interruption insurance),
payments of insurance and rights to payment of any kind. 
 “Governmental Approval” is any consent, authorization, approval,
order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority. 
 “Governmental Authority” is any nation or government, any state or other political subdivision thereof, any agency, authority,
instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any self-regulatory
organization. 
 “Indebtedness” is (a) indebtedness for borrowed money or the deferred price of property or services,
such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations, and (d) Contingent Obligations.

 “Indemnified Person” is defined in Section 12.3. 
 “Insolvency Proceeding” is any proceeding by or against any Person under the United States Bankruptcy Code, or any other bankruptcy or
insolvency law, including assignments for the benefit of creditors, compositions, extensions generally with its creditors, or proceedings seeking reorganization, arrangement, or other relief. 
 “Interest Expense” means for any fiscal period, interest expense (whether cash or non-cash) determined in accordance with GAAP for the
relevant period ending on such date, including, in any event, interest expense with respect to any Credit Extension and other Indebtedness of Borrower, including, without limitation or duplication, all commissions, discounts, or related amortization
and other fees and charges with respect to letters of credit and bankers’ acceptance financing and the net costs associated with interest rate swap, cap, and similar arrangements, and the interest portion of any deferred payment obligation
(including leases of all types). 
 “Inventory” is all “inventory” as defined in the Code in effect on the date
hereof with such additions to such term as may hereafter be made, and includes without limitation all merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and finished products, including without limitation
such inventory as is temporarily out of Borrower’s custody or possession or in transit and including any returned goods and any documents of title representing any of the above. 
 “Investment” is any beneficial ownership interest in any Person (including stock, partnership interest or other securities), and any
loan, advance or capital contribution to any Person. 
 “IP Agreement” is that certain Intellectual Property Security
Agreement executed and delivered by Borrower to Bank dated of even date herewith. 
  

 -24- 

 “Letter of Credit” means a standby letter of credit issued by Bank or another
institution based upon an application, guarantee, indemnity or similar agreement on the part of Bank as set forth in Section 2.1.2. 
 “Letter of Credit Application” is defined in Section 2.1.2(a). 
 “Letter of Credit Reserve”
has the meaning set forth in Section 2.1.2(d). 
 “Lien” is a claim, mortgage, deed of trust, levy, charge, pledge, security
interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property. 
 “Loan Documents” are, collectively, this Agreement, the Perfection Certificate, the IP 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, all as amended, restated, or otherwise modified. 
 “Material Adverse Change” is (a) a material impairment in the perfection or priority of Bank’s Lien in the Collateral or in the value of such Collateral; (b) a material adverse change in the business,
operations, or condition (financial or otherwise) of Borrower; (c) a material impairment of the prospect of repayment of any portion of the Obligations; or (d) Bank determines, based upon information available to it and in its reasonable
judgment, that there is a reasonable likelihood that Borrower shall fail to comply with one or more of the financial covenants in Section 6 during the next succeeding financial reporting period. 
 “Net Income” means, as calculated for Borrower for any period as at any date of determination, the net profit (or loss), excluding
non-cash expenses related to stock compensation expenses, after provision for taxes, of Borrower and its Subsidiaries for such period taken as a single accounting period. 
 “Obligations” are Borrower’s obligation to pay when due any debts, principal, interest, Bank Expenses and other amounts Borrower owes Bank now or later, whether under this Agreement, the Loan
Documents, or otherwise, including, without limitation, all obligations relating to letters of credit (including reimbursement obligations for drawn and undrawn letters of credit), cash management services, and foreign exchange contracts, if any,
and including interest accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of Borrower assigned to Bank, and the performance of Borrower’s duties under the Loan Documents. 
 “Operating Documents” are, for any Person, such Person’s formation documents, as certified with the Secretary of State of such
Person’s state of formation on a date that is no earlier than 30 days prior to the Effective Date, and, (a) if such Person is a corporation, its bylaws in current form, (b) if such Person is a limited liability company, its limited
liability company agreement (or similar agreement), and (c) if such Person is a partnership, its partnership agreement (or similar agreement), each of the foregoing with all current amendments or modifications thereto. 
 “Other Services Sublimit” is an amount equal to Seven Hundred Fifty Thousand Dollars ($750,000). 
 “Overadvance” is defined in Section 2.2. 
 “Perfection Certificate” is defined in Section 5.1. 
 “Permitted
Indebtedness” is: 
 (a) Borrower’s Indebtedness to Bank under this Agreement and the other Loan Documents; 
 (b) Indebtedness existing on the Effective Date and shown on the Perfection Certificate; 
 (c) Subordinated Debt; 
 (d) unsecured
Indebtedness to trade creditors incurred in the ordinary course of business; 
 (e) Indebtedness incurred as a result of endorsing negotiable
instruments received in the ordinary course of business; 
  

 -25- 

 (f) Indebtedness secured by Permitted Liens; and 
 (g) extensions, refinancings, modifications, amendments and restatements of any items of Permitted Indebtedness (a) through (f) above, provided
that the principal amount thereof is not increased or the terms thereof are not modified to impose more burdensome terms upon Borrower or its Subsidiary, as the case may be. 
 “Permitted Investments” are: 
 (a) Investments shown on the Perfection Certificate and existing on the Effective Date; 
 (b) Cash Equivalents; 
 (c) Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of
Borrower; 
 (d) Investments consisting of deposit accounts in which Bank has a perfected security interest; 
 (e) Investments accepted in connection with Transfers permitted by Section 7.1; 
 (f) Investments of Subsidiaries in or to other Subsidiaries or Borrower and Investments by Borrower in Subsidiaries not to exceed $50,000 in the
aggregate in any fiscal year; 
 (g) Investments consisting of (i) travel advances and employee relocation loans and other employee
loans and advances in the ordinary course of business, and (ii) loans to employees, officers or directors relating to the purchase of equity securities of Borrower or its Subsidiaries pursuant to employee stock purchase plans or agreements
approved by Borrower’s Board of Directors; 
 (h) Investments (including debt obligations) received in connection with the bankruptcy or
reorganization of customers or suppliers and in settlement of delinquent obligations of, and other disputes with, customers or suppliers arising in the ordinary course of business; and 
 (i) Investments consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers and suppliers who are not Affiliates,
in the ordinary course of business; provided that this paragraph (i) shall not apply to Investments of Borrower in any Subsidiary. 
 “Permitted Liens” are: 
 (a) Liens existing on the Effective Date and shown on the Perfection Certificate or
arising under this Agreement and the other Loan Documents; 
 (b) Liens for taxes, fees, assessments or other government charges or levies,
either not delinquent or being contested in good faith and for which Borrower maintains adequate reserves on its Books, provided that no notice of any such Lien has been filed or recorded under the Internal Revenue Code of 1986, as amended,
and the Treasury Regulations adopted thereunder; 
 (c) purchase money Liens (i) on Equipment acquired or held by Borrower incurred for
financing the acquisition of the Equipment securing no more than $400,000 in the aggregate amount outstanding, or (ii) existing on Equipment when acquired, if the Lien is confined to the property and improvements and the proceeds of the
Equipment; 
 (d) Liens of carriers, warehousemen, suppliers, or other Persons that are possessory in nature arising in the ordinary course
of business so long as such Liens attach only to Inventory, securing liabilities in the aggregate amount not to exceed $50,000 and which are not delinquent or remain payable without penalty or which are being contested in good faith and by
appropriate proceedings which proceedings have the effect of preventing the forfeiture or sale of the property subject thereto; 
 (e) Liens
to secure payment of workers’ compensation, employment insurance, old-age pensions, social security and other like obligations incurred in the ordinary course of business (other than Liens imposed by ERISA), provided, they have no priority over
any of Bank’s Liens and the aggregate amount of the Indebtedness secured by such Liens does not at any time exceed $50,000; 
  

 -26- 

 (f) Liens incurred in the extension, renewal or refinancing of the indebtedness secured by Liens
described in (a) through (c), but any extension, renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness may not increase; 
 (g) leases or subleases of real property granted in the ordinary course of business, and leases, subleases, non-exclusive licenses or sublicenses of
property (other than real property or intellectual property) granted in the ordinary course of Borrower’s business, if the leases, subleases, licenses and sublicenses do not prohibit granting Bank a security interest; 
 (h) non-exclusive license of intellectual property granted to third parties in the ordinary course of business; 
 (i) Liens arising from attachments or judgments, orders, or decrees in circumstances not constituting an Event of Default under Sections 8.4 and 8.7; and

 (j) Liens in favor of other financial institutions arising in connection with Borrower’s deposit and/or securities accounts held at
such institutions, provided that Bank has a perfected security interest in the amounts held in such deposit and/or securities accounts. 
 “Person” is any individual, sole proprietorship, partnership, limited liability company, joint venture, company, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm,
joint stock company, estate, entity or government agency. 
 “Prime Rate” is Bank’s most recently announced “prime
rate,” even if it is not Bank’s lowest rate. 
 “Quick Assets” is, on any date, Borrower’s unrestricted cash
and Cash Equivalents maintained with Bank, and Borrower’s net billed Accounts. 
 “Registered Organization” is any
“registered organization” as defined in the Code with such additions to such term as may hereafter be made 
 “Requirement
of Law” is as to any Person, the organizational or governing documents of such Person, and any law (statutory or common), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject. 
 “Reserves” means, as of any date of determination, such amounts as Bank may from time to time establish and revise in its good faith business judgment, reducing the amount of Advances and other financial accommodations
which would otherwise be available to Borrower (a) to reflect events, conditions, contingencies or risks which, as determined by Bank in its good faith business judgment, do or may adversely affect (i) the Collateral or any other property
which is security for the Obligations or its value (including without limitation any increase in delinquencies of Accounts), (ii) the assets, business or prospects of Borrower or any Guarantor, or (iii) the security interests and other
rights of Bank in the Collateral (including the enforceability, perfection and priority thereof); or (b) to reflect Bank’s good faith belief that any collateral report or financial information furnished by or on behalf of Borrower or any
Guarantor to Bank is or may have been incomplete, inaccurate or misleading in any material respect; or (c) in respect of any state of facts which Bank determines in good faith constitutes an Event of Default or may, with notice or passage of
time or both, constitute an Event of Default. 
 “Responsible Officer” is any of the Chief Executive Officer, President,
Chief Financial Officer and Controller of Borrower. 
 “Revolving Line” is an Advance or Advances in an amount equal to
Three Million and No/100 Dollars ($3,000,000). 
 “Revolving Line Maturity Date” is June     ,
2010. 
  

 -27- 

 “Securities Account” is any “securities account” as defined in the Code with
such additions to such term as may hereafter be made. 
 “Settlement Date” is defined in Section 2.1.3. 
 “Streamline Period” means, as tested on the last day of each month, any period during which Borrower maintains a minimum Adjusted
Quick Ratio, for the two (2) consecutive months then ending, of not less than 2.00 to 1.00.  
 “Subordinated
Debt” is indebtedness incurred by Borrower subordinated to all of Borrower’s now or hereafter indebtedness to Bank (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Bank
entered into between Bank and the other creditor), on terms acceptable to Bank. 
 “Subsidiary” means, with respect to any
Person, any Person of which more than 50.0% of the voting stock or other equity interests (in the case of Persons other than corporations) is owned or controlled directly or indirectly by such Person or one or more of Affiliates of such Person.

 “Term Loan Maturity Date” is June 1, 2010. 
 “Termination Fee” is defined in Section 12.1. 
 “Total Liabilities” is on any day, obligations that should, under GAAP, be classified as liabilities on Borrower’s consolidated balance sheet, including all Indebtedness, and current portion of
Subordinated Debt permitted by Bank to be paid by Borrower, but excluding all other Subordinated Debt. 
 “Transaction
Report” is that certain report of transactions and schedule of collections in the form attached hereto as Exhibit C. 
 “Transfer” is defined in Section 7.1. 
 “Unused Revolving Line Facility Fee” is defined in
Section 2.5(d). 
 THE WRITTEN LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. 
 THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES. 
 [Signature page follows.] 
  

 -28- 

 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the
Effective Date. 
  

			
	BORROWERS:
	
	SONIC FOUNDRY, INC.,
	a Maryland corporation
		
	By	 	 /s/ Kenneth A. Minor

	Name:	 	Kenneth A. Minor
	Title:	 	Chief Financial Officer
	
	 SONIC FOUNDRY MEDIA SYSTEMS, INC.,
 a
Maryland corporation

		
	By	 	 /s/ Kenneth A. Minor

	Name:	 	Kenneth A. Minor
	Title:	 	Chief Financial Officer
	
	BANK:
	
	SILICON VALLEY BANK
		
	By	 	 /s/ Adam Glick

	Name:	 	Adam Glick
	Title:	 	Relationship Officer
	
	Effective Date: June 16, 2008Payoff Letter and Agreement

 Exhibit 10.1 
 LAURUS MASTER FUND, LTD. 
 VALENS U.S. SPV I, LLC 
 VALENS OFFSHORE SPV I, LTD. 
 PSOURCE STRUCTURED DEBT LIMITED 
 c/o Valens Capital Management, LLC 
 355 Madison
Avenue 
 New York, New York 10017 
 June 18, 2008 
 Accentia Biopharmaceuticals, Inc. 
 Analytica International, Inc. (f/k/a The Analytica Group, Inc.) 
 TEAMM Pharmaceuticals, Inc. 
 324 South Hyde Park Ave., Suite 350 
 Tampa, Florida 33606 
 Attention: Chief Financial Officer 
  

	 	Re:	Payoff and Amendment Agreement 

 Ladies and Gentlemen: 
 The undersigned, Laurus Master Fund, Ltd., a Cayman Islands company (“Laurus”), Valens U.S. SPV I, LLC (as partial assignee of Laurus,
“Valens US”), Valens Offshore SPV I, Ltd. (as partial assignee of Laurus, “Valens Offshore”) and PSource Structured Debt Limited (as partial assignee of Laurus, “PSource”; and together with Laurus,
Valens US and Valens Offshore, individually, each a “Creditor Party” and collectively, the “Creditor Parties”), have been advised by Accentia Biopharmaceuticals, Inc., a Florida corporation
(“Accentia”), Analytica International, Inc. (f/k/a The Analytica Group, Inc.), a Florida corporation (“Analytica”), and TEAMM Pharmaceuticals, Inc., a Florida corporation (“Teamm”; and together with
Accentia and Analytica, individually, each a “Company” and collectively, the “Companies”) that the Companies intend to repay all outstanding obligations of the Companies to the Creditor Parties under each of the
following promissory notes (collectively, the “Obligations”): (a) that certain Amended and Restated Secured Non-Convertible Revolving Note in the original principal amount of $5,000,000 dated as of April 29, 2005, as
amended and restated as of February 13, 2006 executed by Accentia and Analytica in favor of Creditor Parties (the “Revolving Note”); (b) that certain Second Amended and Restated Secured Convertible Minimum Borrowing Note
in the original principal amount of $2,500,000 dated as of April 29, 2005, as amended and restated on September 2005 and as further amended and restated on February 13, 2006 executed by Accentia and Analytica in favor of Creditor Parties
(the “Minimum Borrowing Note”); and (c) that certain Second Amended and Restated Secured Convertible Term Note in the original principal amount of $5,000,000 dated as of April 29, 2005, as amended and restated on
August 16, 2005 increasing the principal amount thereunder to $10,000,000 and as further amended and restated as of February 13, 2006 executed by Accentia in favor of Creditor Parties (the “Term Note”; and together with
the Revolving Note and the Minimum Borrowing Note, collectively, the “Existing Notes”), by delivering to Creditor Parties (and their designees as applicable) each of the following documents, in form and substance 

 
satisfactory to Creditor Parties (and their designees as applicable): (i) this letter agreement, (ii) that certain Reaffirmation and Ratification
Agreement dated as of the date hereof among the Companies and the Creditor Parties (as amended, modified or supplemented from time to time, the “Company Reaffirmation and Ratification Agreement”), (iii) those certain
Assignments of Rights Under Royalty Agreement dated as of the date hereof among Accentia, Biovest International, Inc. (“Biovest”) and each Creditor Party (or, as applicable, such Creditor Party’s designee) (as amended, modified
or supplemented from time to time, the “Assignments of Rights Under Royalty Agreement”), (iv) that certain Assignment of Sale Proceeds dated as of the date hereof among Accentia, Analytica and each Creditor Party (or, as
applicable, such Creditor Party’s designee) (as amended, modified or supplemented from time to time, the “Assignments of Sale Proceeds”), (v) the written consent of each of Southwest Bank (successor to Missouri State Bank
and Trust Company) and McKesson Corporation pursuant to which such creditors release their security interest covering the rights assigned by Accentia under the Assignments of Rights Under Royalty Agreement and the Assignment of Sale Proceeds (the
“Consents”), (vi) corporate resolutions authorizing the transactions contemplated by this letter agreement (the “Resolutions”), and (vii) all such other certificates, instruments, documents and agreements
as may be required by Creditor Parties or their respective counsel, and together with this letter agreement, the Company Reaffirmation and Ratification Agreement, each of the Assignments of Rights Under Royalty Agreement, the Assignment of Sale
Proceeds, the Consents and the Resolutions, collectively, the “Payoff Documents”. 
 The parties hereto hereby acknowledge
and agree that receipt by Creditor Parties of (a) the fully-executed, original Payoff Documents and (b) copies of the fully-executed Biovest Documents (as hereafter defined)(the conditions set forth in clauses (a) and (b),
collectively, the “Release Conditions”) (i) shall constitute payment in full of all of the Obligations owing under the Revolving Note, following which the Revolving Note shall be marked as “paid in full” and within a
reasonable time period thereafter returned to Accentia, (ii) shall terminate the commitment of each Creditor Party, if any, to make any loans or provide any other financial accommodations whatsoever to the Companies, (iii) shall, effective
on the earlier of (A) December 31, 2008, (B) the date on which an Analytica Sale (as defined in the Assignments of Sale Proceeds) is consummated, provided Accentia and Analytica comply with their obligations under the Assignments of
Sale Proceeds, or (C) the date on which the Creditor Parties receive a Qualified Payment (as defined in the Assignments of Rights Under Royalty Agreement) in an amount of not less than $8,800,000, constitute payment in full of the Obligations
under the Term Note and Minimum Borrowing Note which Term Note and Minimum Borrowing Note shall be marked as “paid in full” and within a reasonable time period thereafter returned to Accentia and (iv) shall release: 
 (A) all security interests and liens which Teamm may have granted to any Creditor Party; 
 (B) all security interests and liens which Accentia may have granted to any Creditor Party, other than: (1) the security interests and
liens granted by Accentia in respect of the common stock of Analytica pursuant to that certain Amended and Restated Stock Pledge Agreement dated as of April 29, 2005 by Accentia in favor of Creditor Parties (as amended, modified and
supplemented from time to time, the “Amended Stock Pledge Agreement”), it being acknowledged that within a reasonable time period after such security interest and lien release the applicable Creditor Parties shall return to Accentia
all common stock of all entities 

  

 2 

 
(other than Analytica) pledged to Creditor Parties under the Amended Stock Pledge Agreement, (2) the security interests and liens granted by Accentia in
favor of Creditor Parties pursuant to that certain Amended and Restated Security Agreement dated February 13, 2006 (as amended, modified and supplemented from time to time, the “February 2006 Security Agreement”) in respect of
assets of Analytica, (3) the security interests and liens granted by Accentia under the Collateral Assignment (as hereafter defined), (4) the security interests and liens granted by Accentia for the benefit of one or more of the Creditor
Parties and the other investors under the Midsummer Documents (as hereafter defined) and (5) the security interests and liens granted by Accentia for the benefit of Laurus (and its assignees) under the Accentia Pledge Agreement dated as of
March 31, 2006 among Laurus (as its assignees), Accentia and Biovest (as amended, modified and supplemented from time to time, the “March 2006 Pledge Agreement”); and 
 (C) all security interests and liens which The Francis E. O’Donnell, Jr. Irrevocable Trust No. 1 (the “Trust”) granted to the
applicable Creditor Parties under the Stock Pledge Agreement dated April 29, 2005 between the applicable Creditor Parties and the Trust. Within a reasonable time period following such security interest and lien release, the applicable Creditor
Parties shall return to the Trust the original stock certificates evidencing the collateral pledged thereunder. 
 Within a reasonable time
period after receipt by the Creditor Parties of the fully-executed, original Payoff Documents and fully-executed, original Biovest Documents, Creditor Parties shall instruct the bank maintaining the lockbox arrangement with respect to
Analytica’s accounts receivable that such bank is permitted to accept instructions from Analytica with respect to such accounts receivable and the Creditor Parties shall not deliver to such bank any contrary instruction so long as no default
has occurred under any document, instrument or agreement between or among Analytica, Accentia or any of its subsidiaries and any Creditor Party, after which the Creditor Parties may elect to have sole dominion and control over such accounts
receivable and the deposit account into which they are remitted. 
 The Creditor Parties, Accentia, Teamm and Analytica hereby acknowledge
that (a) the obligations secured by the collateral granted under the Amended Stock Pledge Agreement, February 2006 Security Agreement, Collateral Assignment and March 2006 Pledge Agreement (collectively, the “Collateral
Agreements”) shall be limited to the obligations and liabilities arising out of, owing in respect of and/or covered by the Payoff Documents, that certain Guaranty dated March 31, 2006 (as amended, modified and supplemented from time to
time) by Accentia in favor of Laurus and its assignees, the Term Note and the Minimum Borrowing Note and (b) the Creditor Parties shall release their security interests and liens granted pursuant to the Collateral Agreements if (i) on or
before December 31, 2008, there has occurred an Analytica Sale (as defined in the Assignments of Sale Proceeds) or (ii) on or before December 31, 2008, an Analytica Sale has not occurred and (A) the Creditor Parties have
received, on or prior to December 31, 2008, a Qualified Payment (as defined in the Assignments of Rights Under Royalty Agreement) of at least $8,800,000 or (B) (1) the Creditor Parties have not received a Qualified Payment of at least
$8,800,000 and (2) each Creditor Party (or its assignee, as applicable), which is a party to the Assignments of Rights Under Royalty Agreement, either (I) chooses the Stock Election (as defined in the Assignments of Rights Under Royalty
Agreement) and Accentia complies with the requirements set forth in Section 1(a)(i)(B)(2) of the Assignments of Rights Under Royalty Agreement in connection with the Stock Election or (II) elects to receive the additional royalty in lieu of the
Specified Payment (as defined in the Assignments of Rights Under Royalty Agreement) as set forth in Section (1)(a)(i)(B)(1) of the Assignments of Rights Under Royalty Agreement. 
  

 3 

 For purposes hereof, (a) the term “Biovest Documents” means all documents,
instruments and agreements required by, and in form and substance acceptable to, Valens US and Valens Offshore SPV II, Corp. (“Valens Offshore II”), in connection with the extension of the maturity date under those certain
promissory notes issued by Biovest to Valens US and Valens Offshore II and the grant to Valens Offshore II of an additional royalty interest in accordance with the amendment letter dated as of May 30, 2008 between Valens Offshore II and Biovest
which amends and restates in its entirety Section 4.1 of the Royalty Agreement dated as of December 10, 2007 between Biovest and Valens Offshore II; (b) the term “Collateral Assignment” means the Collateral Assignment
dated as of the date hereof made by Accentia in favor of Laurus, Valens Offshore, Valens SPV II, Corp. and PSource, as the same may be amended, modified and supplemented from time to time and (c) the term “Midsummer Documents”
means the Securities Purchase Agreement dated as of September 29, 2006 among Accentia and each purchaser identified on the signature pages thereto together with all documents, instruments and agreements entered into in connection with the
transactions contemplated thereby, as each may be amended, modified and supplemented from time to time. 
 The parties hereto hereby
acknowledge that nothing contained herein shall amend or modify or otherwise release in any manner whatsoever any security interest or lien granted by Biovest and/or any of its subsidiaries under any document, instrument and/or agreement between
Biovest and/or any of its subsidiaries and any Creditor Party and/or such Creditor Party’s affiliates. 
 Upon satisfaction of the
Release Conditions: 
 (a) Notwithstanding anything to the contrary contained in the Term Note and Minimum Borrowing Note, interest payable on
the outstanding principal amount of the Term Note and Minimum Borrowing Note shall not accrue for the period beginning on the date hereof through and including December 31, 2008; 
 (b) Notwithstanding anything to the contrary contained in the Term Note or Minimum Borrowing Note, the Maturity Date (as defined in the Term Note and
Minimum Borrowing Note) shall be December 31, 2008; 
 (c) Notwithstanding anything to the contrary contained in the Term Note, the
Fixed Conversion Price shall mean $1.20; and 
 (d) Section 3.1 of the Minimum Borrowing Note is hereby amended by deleting such section
it its entirety and inserting in lieu thereof the following: 
 Subject to the terms of this Article III, the Holder shall have the right, but
not the obligation, to convert all or any portion of the outstanding Principal Amount and/or accrued interest and fees due and payable into fully paid and nonassessable shares of Common Stock at the Fixed Conversion Price. For purposes hereof,
subject to Section 3.6 hereof, the initial “Fixed Conversion Price” shall be $1.20. The shares of Common Stock to be issued upon such conversion are herein referred to as the “Conversion Shares.” 
  

 4 

 For and in consideration of Creditor Parties’ agreements contained herein, the Companies and their
respective officers, directors, employees, representatives, agents, executors, heirs, administrators, successors and assigns (collectively, the “Releasing Parties”) hereby release each Creditor Party and its officers, directors,
representatives, employees, agents, attorneys-in-fact, affiliates and successors and assigns (collectively the “Released Parties”) from any and all claims, demands, agreements, actions, expenses, damages, judgments, liabilities and
obligations which any of the Releasing Parties has ever had against any of the Released Parties including, without limitation, with respect to the Existing Notes or any of the transactions relating to the Existing Notes and hereby agree to indemnify
the Released Parties from, and hold the Released Parties harmless against, the same. 
 This letter agreement shall be governed by and
construed in accordance with the laws of the State of New York. 
 [Remainder of the page intentionally blank.] 
  

 5 

 This letter agreement may be executed in one or more counterparts each of which taken together shall
constitute one and the same agreement. Any signature delivered by a party by facsimile transmission or other electronic transmission shall be deemed an original signature hereto. 
  

			
	Very truly yours,
	
	LAURUS MASTER FUND, LTD.
		
	By:	 	Laurus Capital Management, LLC,
		 	its investment manager
		
	By:	 	 /s/ Patrick Regan

	Name:	 	Patrick Regan
	Title:	 	Authorized Signatory
	
	VALENS OFFSHORE SPV I, LTD.
		
	By:	 	Valens Capital Management, LLC,
		 	its investment manager
		
	By:	 	 /s/ Patrick Regan

	Name:	 	Patrick Regan
	Title:	 	Authorized Signatory
	
	VALENS U.S. SPV I, LLC
		
	By:	 	Valens Capital Management, LLC,
		 	its investment manager
		
	By:	 	 /s/ Patrick Regan

	Name:	 	Patrick Regan
	Title:	 	Authorized Signatory

			
	PSOURCE STRUCTURED DEBT LIMITED
		
	By:	 	Laurus Capital Management, LLC,
		 	its investment manager
		
	By:	 	 /s/ John Gilfillan

	Name:	 	John Gilfillan
	Title:	 	Director PSource Capital Ltd for and on
		 	Behalf of PSource Structured Debt Limited

  

			
	 Acknowledged and Agreed to
 as of the date
first written above:

	
	ACCENTIA BIOPHARMACEUTICALS, INC.
		
	By:	 	 /s/ James A. McNulty

	Name:	 	James A. McNulty, CPA
	Title:	 	Secretary/Treas
	
	 ANALYTICA INTERNATIONAL, INC.,
 f/k/a The
Analytica Group, Inc.

		
	By:	 	 /s/ James A. McNulty

	Name:	 	James A. McNulty, CPA
	Title:	 	Secretary
	
	TEAMM PHARMACEUTICALS, INC.
		
	By:	 	 /s/ James A. McNulty

	Name:	 	James A. McNulty, CPA
	Title:	 	Secretary

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00143-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00143-of-00352.parquet"}]]