Document:

Form of Note

 EXHIBIT 4.01 
 THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A NOTE PURCHASE AGREEMENT DATED AS OF APRIL 20, 2008, BY AND AMONG THE ISSUER AND THE OTHER PERSONS NAMED THEREIN, AS SUCH AGREEMENT MAY BE AMENDED, RESTATED OR MODIFIED FROM
TIME TO TIME, AND MAY NOT BE TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE WITH THE PROVISIONS THEREOF, AND ANY TRANSFEREE OF THESE SECURITIES SHALL BE SUBJECT TO THE TERMS OF SUCH AGREEMENT. COPIES
OF SUCH AGREEMENT ARE MAINTAINED WITH THE CORPORATE RECORDS OF THE ISSUER AND ARE AVAILABLE FOR INSPECTION AT THE PRINCIPAL OFFICES OF THE ISSUER. 
 THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD OR TRANSFERRED EXCEPT PURSUANT TO (I) AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, AND IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS OR (II) AN APPLICABLE EXEMPTION FROM REGISTRATION UNDER THE ACT AND UNDER APPLICABLE STATE SECURITIES LAWS. 
 BLUE COAT SYSTEMS, INC. 
 SENIOR CONVERTIBLE
NOTE 
 Issuance Date:             , 2008 Original Principal Amount: U.S.
$                     
 FOR VALUE
RECEIVED, Blue Coat Systems, Inc., a Delaware corporation (the “Company”), hereby promises to pay to the order of              (“Holder”) the amount set
forth above as the Original Principal Amount (as reduced pursuant to the terms hereof, the “Principal”) when due, whether upon the Maturity Date (as defined below), acceleration or otherwise (in each case in accordance with the
terms hereof). This Senior Convertible Note (including all Senior Convertible Notes issued in exchange, transfer or replacement hereof, this “Note”) is one of an issue of Senior Convertible Notes (collectively, the
“Notes” and such other Senior Convertible Notes, the “Other Notes”) issued pursuant to the Purchase Agreement (as defined below). Capitalized terms used herein and not otherwise defined have the respective meanings
given them in Section 24. 
 1. Maturity. On the Maturity Date, the Holder
shall surrender this Note to the Company and the Company shall pay to the Holder the outstanding Principal and accrued and unpaid Late Charges, if any, on such Principal to but excluding the Maturity Date. The “Maturity Date” shall
be             , 2013. 1 
 2. Interest; Interest Rate. This Note shall not bear interest (other than any Late Charge). 
 3. Conversion. This Note shall be convertible into shares of the Company’s Common Stock on the terms and conditions set forth in this
Section 3. 
 (a) Conversion Right. At any time or times on or after the Issuance Date, the Holder shall be entitled to convert
all (or any portion equal to $1,000 or any integral multiple of $1,000 in excess thereof) of the outstanding and unpaid Conversion Amount into fully paid, validly issued and nonassessable shares of Common Stock in accordance with Section 3(c),
at the Conversion Rate. The Company shall not issue any fraction of a share of 
  

	1	The Maturity Date of the Notes shall be the fifth anniversary of the Issuance Date. 

  

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Common Stock upon any conversion. If the issuance would result in the issuance of a fraction of a share of Common Stock, the Company shall round such
fraction to the nearest whole share. The Company shall pay any and all taxes and fees that may be payable with respect to the issuance and delivery of Common Stock upon conversion of any Conversion Amount. 
 (b) Conversion Rate. The number of shares of Common Stock issuable upon conversion of any Conversion Amount pursuant to this Note shall be
determined by dividing (x) such Conversion Amount by (y) the then applicable Conversion Price (the “Conversion Rate”). 
 (i) “Conversion Amount” means the portion of the Principal to be converted, redeemed or otherwise with respect to which this determination is being made. 
 (ii) “Conversion Price” means, as of any Conversion Date or other date of determination, $20.76, subject to adjustment as
provided herein. 
 (c) Conversion Mechanics. 
 (i) To convert any Conversion Amount into shares of Common Stock on any date (a “Conversion Date”), the Holder
shall transmit by facsimile (or otherwise deliver) a copy of an executed notice of conversion in the form attached hereto as Exhibit I (the “Conversion Notice”) to the Company in accordance with Section 19(a), with
a copy to the Company’s transfer agent for the Common Stock (the “Transfer Agent”) and (B) if required by Section 14(d), surrender this Note to a common carrier for delivery to the Company as soon as practicable on or
following such date (or an indemnification undertaking with respect to this Note in the case of its loss, theft or destruction). On or before the third (3rd) Business Day following the date of receipt of a Conversion Notice and, if required
hereby, this Note (the “Share Delivery Date”), the Company shall: 
 (A) if the Transfer Agent is
participating in The Depository Trust Company’s (“DTC”) Fast Automated Securities Transfer Program, credit such aggregate number of shares of Common Stock to which the Holder shall be entitled to the Holder’s or its
designee’s balance account with DTC through its Deposits and Withdrawal at Custodian system; provided that such shares of Common Stock shall not be Restricted Securities; or 
 (B) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program or, if such shares of Common Stock
are Restricted Securities, issue and deliver to the address as specified in the Conversion Notice, a certificate, registered in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder shall be entitled.

 (ii) Pro Rata Conversion. Without limiting the remedies set forth above, in the event that the Company receives a
Conversion Notice from more than one holder of Notes for the same Conversion Date and the Company can convert some, but not all, of such portions of the Notes submitted for conversion, the Company, subject to the restrictions in this Note, shall
convert from each holder of Notes electing to have Notes converted on such date a pro rata amount of such holder’s portion of its Notes submitted for conversion based on the principal amount of Notes submitted for conversion on such date by
such holder relative to the aggregate principal amount of all Notes submitted for conversion on such date. In the event of a dispute as to the number of shares of Common Stock issuable to the Holder in connection with a conversion of this Note, the
Company shall issue to the Holder the number of shares of Common Stock not in dispute and resolve such dispute thereafter. 
 (iii) Limitations on Conversion. The Company shall not effect any conversion of this Note, and the Holder of this Note shall not have the right to convert any portion of this Note pursuant to Section 3(a), to the extent that
after giving effect to such conversion, the Holder (together with the Holder’s Affiliates) would beneficially own in excess of 9.9% (the “Maximum Percentage”) of the number of shares of Common Stock outstanding immediately
after giving effect to such conversion. For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its 

  

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Affiliates shall include the number of shares of Common Stock issuable upon conversion of this Note with respect to which the determination of such sentence
is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (A) conversion of the remaining, nonconverted portion of this Note beneficially owned by the Holder or any of its Affiliates and
(B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any Other Notes or warrants) subject to a limitation on conversion or exercise analogous to the
limitation contained herein beneficially owned by the Holder or any of its Affiliates. Except as set forth in the preceding sentence, for purposes of this Section 3(c)(iii), beneficial ownership shall be calculated in accordance with
Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). For purposes of this Section 3(c)(iii), in determining the number of outstanding shares of Common Stock, the Holder may rely on the
number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent Form 10-K, Form 10-Q or Form 8-K, as the case may be, (y) a more recent public announcement by the Company or (z) any other recent notice
by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding. Upon the written request of the Holder, the Company shall within two (2) Business Days confirm orally and in writing to the Holder the number
of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Note, by the Holder or its
Affiliates since the date as of which such number of outstanding shares of Common Stock was reported. By written notice to the Company, the Holder may increase or decrease the Maximum Percentage to any percentage not in excess of 9.9% specified in
such notice; provided that (i) any such increase will not be effective until the sixty-first (61st) day after such notice is delivered to
the Company, and (ii) any such increase or decrease will apply only to the Holder and not to any other holder of Notes. 
 (iv) Principal Market Regulation. The Company shall not be obligated to issue any shares of Common Stock upon conversion of this Note if the issuance of such shares of Common Stock would exceed that number of shares of Common Stock
which the Company may issue upon conversion or exercise, as applicable, of the Notes without breaching the Company’s obligations under the rules or regulations of the Principal Market. 
 4. Put Right. 
 (a) Put Right.
If the Common Stock is suspended from trading or ceases to be listed on an Eligible Market for a period of five (5) consecutive Trading Days or for more than an aggregate of fifteen (15) Trading Days in any 365-day period (a “Put
Event”), the Holder shall have the right, at the Holder’s option (the “Put Option”), to require the Company to repurchase for cash all or a portion of this Note at a purchase price equal to 100% of the outstanding
Principal and accrued and unpaid Late Charges, if any, on this Note (the “Put Price”). For the avoidance of doubt, a Put Event shall be deemed to occur immediately prior to a Fundamental Transaction in which the Common Stock is
converted into or exchanged for cash, securities or property, other than a Fundamental Transaction in which the Common Stock is converted into or exchanged for consideration at least 90% (by value) of which (excluding cash payments for fractional
shares and pursuant to dissenters’ appraisal rights) consists of a Successor Entity’s common stock or equivalent equity security which trades or is listed or quoted on an Eligible Market. 
 (b) Put Mechanics. In order to exercise a Put Option, the Holder shall (A) transmit by facsimile (or otherwise deliver) a written notice of
the Holder’s election to exercise such Put Option (the “Put Notice”) to the Company in accordance with Section 19(a) and (B) if required by Section 14(d), surrender this Note to a common carrier for delivery to
the Company as soon as practicable on or following such date (or an indemnification undertaking with respect to this Note in the case of its loss, theft or destruction). On or before the tenth (10th) Business Day following the date of receipt
of a Put Notice and, if required hereby, this Note (the “Share Delivery Date”), the Company shall make payment of the Put Price in accordance with Section 19(b). 
  

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 5. Rights Upon Event of Default. 
 (a) Event of Default. Each of the following events shall constitute an “Event of Default”: 
 (i) the Company’s failure to cure a Conversion Failure by delivery of the required number of shares of Common Stock within
ten (10) Trading Days after the applicable Conversion Date; 
 (ii) the Company’s failure to pay to the Holder any
amount of Principal or Late Charges when and as due under this Note (including in connection with any exercise of the Put Option); 
 (iii) the Company or any of its Significant Subsidiaries, pursuant to or within the meaning of Title 11, United States Code, or any similar federal, foreign or state law for the relief of debtors (collectively, “Bankruptcy
Law”), (A) commences a voluntary case, (B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointment of a receiver, trustee, assignee, liquidator or similar official (a
“Custodian”) for a material portion of its properties or (D) makes a general assignment for the benefit of its creditors; 
 (iv) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (A) is for relief against the Company or any of its Significant Subsidiaries in an involuntary case,
(B) appoints a Custodian of the Company or any of its Significant Subsidiaries for a material portion of its properties or (C) orders the liquidation of the Company or any of its Significant Subsidiaries, which order or decree, in the case
of any of clauses (A) through (C), remains unstayed and in effect for 90 days or more; 
 (v) upon the later of
(A) sixty (60) days after the occurrence of a default for failure to pay principal or interest on any other Indebtedness of the Company or any of its Significant Subsidiaries involving an outstanding principal amount in excess of
$25,000,000, where such default would give rise to the acceleration of such indebtedness and (B) the actual acceleration of such other indebtedness; or 
 (vi) a final judgment or judgments for the payment of money aggregating in excess of $25,000,000 are rendered against the Company or any
of its Significant Subsidiaries and which judgments are not, within ninety (90) days after the entry thereof, bonded, discharged or stayed pending appeal, or are not discharged within ninety (90) days after the expiration of such stay.

 (b) Remedies. Upon the occurrence of an Event of Default pursuant to Section 5(a)(iii) or 5(a)(iv), the outstanding Principal
and accrued and unpaid Late Charges, if any, on this Note shall become immediately due and payable. If any Event of Default other than an Event of Default pursuant to Section 5(a)(iii) or 5(a)(iv) shall occur and be continuing, the holders of
at least twenty-five percent (25%) in aggregate Principal amount of the Notes outstanding may, by written notice to the Company, declare the outstanding Principal and accrued and unpaid Late Charges, if any, on the Notes and the Other Notes
immediately due and payable; provided that any declaration of acceleration pursuant to this sentence may be rescinded and annulled with the written consent of the holders of at least a majority in aggregate Principal amount of the Notes
outstanding. 
 6. Adjustment of Conversion Price. 
 (a) Stock Dividends and Stock Splits. If the Company, at any time while this Note is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on shares of Common Stock,
payable in shares of Common Stock or any securities of the Company or any of its Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, rights, options,
warrants or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock; (ii) subdivides outstanding shares of Common Stock into a larger number of
shares; (iii) combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of shares; or (iv) issues, in the event of a reclassification of shares of the Common Stock, any shares of capital
stock of the Company, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding any treasury shares of the Company) outstanding immediately prior to such event and of
which the denominator shall be the number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to this Section shall 

  

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become effective immediately after the distribution date of any such dividend or distribution and shall become effective immediately after the effective date
in the case of a subdivision, combination or re-classification. 
 (b) Subsequent Rights Offerings. If the Company, at any time while
this Note is outstanding, issues rights, options or warrants to all holders of Common Stock, such issuance will also be granted to the Holder on an as-converted basis without the Holder having to convert this Note in order to be entitled to such
issuance. 
 (c) Other Dividends. If the Company, at any time while this Note is outstanding, pays a dividend or otherwise makes a
distribution or distributions of cash or other assets (other than any dividend or distribution described in Section 6(a) or 6(d)), such dividend will also be granted to the Holder on an as-converted basis (without regard to any conversion
limitations) without the Holder having to convert this Note in order to be entitled to such issuance. 
 (d) Fundamental Transactions.
If, at any time while this Note is outstanding, (i) the Company effects any merger or consolidation of the Company with or into another Person, (ii) the Company effects any sale of all or substantially all of its assets in one transaction
or a series of related transactions to any Person other than a wholly owned Subsidiary, or (iii) the Company effects any reclassification of the Common Stock or any compulsory share exchange, in each case as a result of which the Common Stock
is effectively converted into or exchanged for other securities, cash or property (in any such case, a “Fundamental Transaction”), then, upon any subsequent conversion of this Note, the Holder shall have the right to receive, for
each share of Common Stock that would have been issuable upon conversion of this Note immediately prior to the occurrence of such Fundamental Transaction, the same kind and amount of securities, cash or property as it would have been entitled to
receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of one (1) share of Common Stock (the “Alternate Consideration”). If the Fundamental
Transaction causes the Common Stock to be converted into the right to receive more than a single type of consideration (determined based in part upon any form of stockholder election), the Alternate Consideration into which the Notes will be
convertible will be deemed to be the weighted average of the types and amounts of consideration received by the holders of Common Stock that affirmatively make such election. To the extent necessary to effectuate the foregoing provisions, any
Successor Entity shall issue to the Holder a new Note consistent with the foregoing provisions and evidencing the Holder’s right to convert such Note into Alternate Consideration. The terms of any agreement pursuant to which a Fundamental
Transaction is effected shall include terms requiring any such successor or surviving entity to comply with the provisions of this Section 6(d) and ensuring that this Note (or any such replacement security) will be similarly adjusted upon any
subsequent transaction analogous to a Fundamental Transaction. 
 (e) Adjustment of Conversion Price upon Certain Self-Tenders. If the
Company at any time or from time to time on or after the Issuance Date makes a payment of cash or other consideration to the holders of the Common Stock in respect of a tender offer or exchange offer, other than an odd-lot offer, and the value of
the sum of (i) the aggregate cash and other consideration paid for such Common Stock, and (ii) any other consent or other fees paid to holders of Common Stock in respect of such tender offer or exchange offer expressed as an amount per
share of Common Stock validly tendered or exchanged pursuant to such tender offer or exchange offer, exceeds the Volume Weighted Average Price of the Common Stock on the Trading Day immediately prior to the date any such tender offer or exchange
offer is first publicly announced (the “Tender Announcement Date”), then the Conversion Price shall be adjusted in accordance with the following formula: 
 R’ = R x     O x P     
                F + (P x O’) 
 For purposes of the
foregoing formula: 
 R = the Conversion Price in effect at the expiration time of the tender offer or exchange offer that is the subject of
this Section 6(e) (the “Expiration Time”); 
 R’ = the Conversion Price in effect immediately after the Expiration
Time; 
  

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 F = the fair market value (as determined by the Company’s Board of Directors in the exercise of
their fiduciary duties with the concurrence of the Required Holders) of the aggregate value of all cash and any other consideration paid or payable for Common Stock validly tendered or exchanged (including any consent or other fees) and not
withdrawn prior to the Expiration Time (the “Purchased Shares”); 
 O’ = the number of shares of Common Stock
outstanding immediately after the Expiration Time, excluding any Purchased Shares; 
 O = the number of shares of Common Stock outstanding
immediately after the Expiration Time, including any Purchased Shares; and 
 P = the Volume Weighted Average Price of the Common Stock on the
Trading Day next succeeding the Tender Announcement Date. 
 Such decrease, if any, shall become effective immediately upon the opening of
business on the day next succeeding the Expiration Time. In the event that the Company is obligated to purchase shares pursuant to any tender offer or exchange offer, but the Company is prevented by applicable law from effecting any such purchases
or all such purchases are rescinded, the Conversion Price shall again be adjusted to the Conversion Price that would then be in effect if such tender or exchange offer had not been made. If the application of this Section 6(e) to any tender or
exchange offer would result in an increase in the Conversion Price, no adjustment shall be made for such tender or exchange offer under this Section 6(e). The Company shall not effect any transaction described in this Section 6(e) if such
transaction would have the effect of setting the Conversion Price at an amount that would cause the exercise in full of the conversion rights set forth in this Section 6 to result in a violation of NASD Rules or any listing standards applicable
to the Company. 
 (f) Calculations. All calculations under this Section 6 shall be made to the nearest cent or the nearest
1/100th of a share, as the case may be. No adjustment shall be made to the Conversion Price unless such adjustment would require a change of at least 1% in the Conversion Price. Any adjustment that would otherwise be required to be made shall be
carried forward and taken into account in any subsequent adjustment or in connection with any Conversion of the Notes. For purposes of this Section 6, the number of shares of Common Stock deemed to be issued and outstanding as of a given date
shall be the sum of the number of shares of Common Stock (excluding any treasury shares of the Company) issued and outstanding. 
 (g)
Limitations on Adjustments. Notwithstanding the foregoing, no adjustment of the Conversion Price shall be made pursuant to this Section 6 with respect to any transaction that would otherwise result in an adjustment to the Conversion
Price pursuant to this Section 6 (an “Adjustment Transaction”) to the extent that the Holder of this Note is permitted to participate in such Adjustment Transaction, without conversion of this Note, on the same terms and with
the same rights as if the Holder was the holder of the number of shares of Common Stock issuable upon conversion of this Note as of the record date or other applicable relevant date for such Adjustment Transaction. In addition, notwithstanding the
foregoing, no adjustment of the Conversion Price shall be made pursuant to this Section 6 as a result of any issuance of Common Stock: 
 (i) in connection with any existing or future equity incentive plan or grant of equity incentives to directors or employees (including new directors and employees) approved by the Board of Directors of the Company;

 (ii) upon the exercise or conversion of any options or convertible securities outstanding prior to the Issuance Date;

 (iii) upon conversion of the Notes; or 
 (iv) for any accrued and unpaid Late Charges. 
 7. Fundamental Transactions. The Company shall not enter into or be party to a Fundamental Transaction unless the Successor Entity assumes in writing all of the obligations of the Company under this Note and
the 

  

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other Transaction Documents in accordance with the provisions of this Section 7 pursuant to written agreements, including agreements to deliver to each
holder of Notes in exchange for such Notes a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to the Notes, including, without limitation, having a principal amount equal to the principal
amounts of the Notes held by such holder, having substantially identical conversion rights as the Notes (and, as applicable, reflecting any adjustments pursuant to 6(d)) and having substantially identical ranking to the Notes. Upon the occurrence of
any Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Note referring to the “Company” shall refer instead to the
Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Note with the same effect as if such Successor Entity had been named as the Company herein. The provisions of
this Section 7 shall apply similarly and equally to successive Fundamental Transactions and shall be applied without regard to any limitations on the conversion or redemption of this Note. 
 8. Avoidance of Obligations. The Company hereby covenants and agrees that the Company will not, by amendment of its certificate of incorporation,
bylaws or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action (including entering into any agreement which would limit or restrict the
Company’s ability to perform under any Transaction Document), avoid or seek to avoid the observance or performance of any of the material terms of this Note or other Transaction Document, and will at all times in good faith carry out all of the
provisions of the Transaction Documents and take all action as may be required to protect the rights of the Holder under the Transaction Documents. 
 9. Reservation of Authorized Shares. 
 (a) Reservation. So long as any of the Notes are outstanding, the Company shall
take all action necessary to reserve and keep available out of its authorized and unissued Common Stock, solely for the purpose of effecting the conversion of the Notes, a number of shares of Common Stock for each of the Notes equal to the greater
of (x) 4,046,243 shares of Common Stock (which number of shares equals 105% of the Conversion Rate with respect to the Conversion Amount of each such Note as of the Issuance Date) and (y) 100% of the Conversion Rate with respect to the
Conversion Amount of each such Note as then in effect (the “Required Reserve Amount”). The initial number of shares of Common Stock reserved for conversions of the Notes and each increase in the number of shares so reserved shall be
allocated pro rata among the holders of the Notes based on the principal amount of the Notes held by each holder at the Closing (as defined in the Purchase Agreement) or increase in the number of reserved shares, as the case may be (the
“Authorized Share Allocation”). In the event that a holder shall sell or otherwise transfer any of such holder’s Notes, each transferee shall be allocated a pro rata portion of such holder’s Authorized Share Allocation.
Any shares of Common Stock reserved and allocated to any Person which ceases to hold any Notes shall be allocated to the remaining holders of Notes, pro rata based on the principal amount of the Notes then held by such holders. 
 (b) Insufficient Authorized Shares. If at any time while any of the Notes remain outstanding the Company does not have a sufficient number of
authorized and unreserved shares of Common Stock to satisfy its obligation to reserve for issuance upon conversion of the Notes at least a number of shares of Common Stock equal to the Required Reserve Amount (an “Authorized Share
Failure”), then the Company shall immediately take all action necessary to increase the Company’s authorized shares of Common Stock to an amount sufficient to allow the Company to reserve the Required Reserve Amount for the Notes then
outstanding. Without limiting the generality of the foregoing sentence, as soon as practicable after the date of an Authorized Share Failure, but in no event later than the next annual meeting of the stockholders of the Company after the occurrence
of such Authorized Share Failure at which such proposal can properly be brought before the stockholders, the Company shall seek approval for an increase in the number of authorized shares of Common Stock. In connection with such meeting, the Company
shall provide each stockholder with a proxy statement and shall use its commercially reasonable best efforts to solicit its stockholders’ approval of such increase in authorized shares of Common Stock and to cause its Board of Directors to
recommend to the stockholders that they approve such proposal. 
  

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 10. Voting Rights. The Holder shall have no voting rights as the holder of this Note, except as
required by law, including but not limited to the General Corporate Law of the State of Delaware, and as expressly provided in this Note. 
 11. Rank. All payments due under this Note shall rank pari passu with all Other Notes and all other Senior Indebtedness of the Company. 
 12. Vote to Change Terms of the Notes. The affirmative vote at a meeting duly called for such purpose or the written consent without a meeting of the Required Holders shall be required for any change or
amendment to the Notes and such change or amendment shall bind all holders of the Notes; provided, that no reduction to the Principal or Late Charges or change to the Maturity Date or any conversion or put rights set forth herein may be made
without the affirmative vote or written consent of each holder of Notes affected thereby; provided, further, that the Holder of this Note may amend or waive any term or provision of this Note without such vote or written consent. 
 13. Transfer. Subject to any restrictions on transfer set forth in the Purchase Agreement, this Note may be offered, sold, assigned or transferred
by the Holder without the consent of the Company; provided that the Note may not be transferred in increments of less than $20,000,000 (or $5,000,000 at any time after an Event of Default) in principal amount or such lesser principal amount
of Notes as is then held by the Holder; provided, further, that the limitation in the immediately preceding proviso shall not apply with respect to any transfer by a Holder to a Permitted Transferee (as defined in the Purchase
Agreement) of such Holder in amounts of not less than $100,000 or such lesser principal amount of Notes as is then held by the Holder. 
 14.
Reissuance of This Note; Book Entry. 
 (a) Transfer. If this Note is to be transferred, the Holder shall surrender this Note
to the Company, whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Note (in accordance with Section 14(c)), registered as the Holder may request, representing the outstanding Principal being transferred by
the Holder and, if less then the entire outstanding Principal is being transferred, a new Note (in accordance with Section 14(c)) to the Holder representing the outstanding Principal not being transferred. The Holder and any assignee, by
acceptance of this Note, acknowledge and agree that following conversion or put of any portion of this Note, the outstanding Principal represented by this Note may be less than the Principal stated on the face of this Note. 
 (b) Lost, Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of this Note, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Note, the Company
shall execute and deliver to the Holder a new Note (in accordance with Section 14(c)) representing the outstanding Principal. 
 (c)
Issuance of New Notes. 
 (i) Whenever the Company is required to issue a new Note pursuant to the terms of this Note,
such new Note (i) shall be of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining outstanding (or in the case of a new Note being issued pursuant to Section 14(a) or
Section 14(c), the Principal designated by the Holder which, when added to the principal represented by the other new Notes issued in connection with such issuance, does not exceed the Principal remaining outstanding under this Note immediately
prior to such issuance of new Notes), (iii) shall have an issuance date, as indicated on the face of such new Note, which is the same as the Issuance Date of this Note, and (iv) shall have the same rights and conditions as this Note.

 (ii) This Note is exchangeable, upon the surrender hereof by the Holder at the principal office of the Company, for a new
Note or Notes in principal amounts of at least $20,000,000 (or $5,000,000 at any time after an Event of Default) in principal amount or such lesser principal amount of Notes as is then held by the 

  

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Holder (or, if issued to facilitate a transfer to a Permitted Transferee of a Holder, in an amount not less than $100,000 or such lesser principal amount of
Notes as is then held by the Holder), representing in the aggregate the outstanding Principal of this Note, and each such new Note will represent such portion of such outstanding Principal as is designated by the Holder at the time of such
surrender. 
 (d) Book-Entry. Notwithstanding anything to the contrary set
forth herein, upon conversion or purchase by the Company of any portion of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Company unless (i) the full Conversion Amount
represented by this Note is being converted, (ii) the full Put Price represented by this Note is being put to the Company pursuant to the Put Option or (iii) the Holder has provided the Company with prior written notice (which notice may
be included in a Conversion Notice) requesting reissuance of this Note upon physical surrender. The Holder and the Company shall maintain records showing the Principal and Late Charges converted and the dates of such conversions or purchase or shall
use such other method, reasonably satisfactory to the Holder and the Company, so as not to require physical surrender of this Note upon conversion. If the outstanding Principal of this Note is greater than the Principal portion being converted or
repurchased, and the Holder hereof shall request in writing, then the Company shall as soon as practicable, and in no event later than fifth (5th) Business Days after, such request and receipt of this Note and at its own expense, issue and deliver to the Holder a new Note (in accordance with Section 14) representing the outstanding Principal not converted or purchased. The
Person or Persons specified in the Conversion Notice as entitled to receive the shares of Common Stock issuable upon a conversion of this Note shall be treated for all purposes as the record holder or holders of such shares of Common Stock on the
Conversion Date. 
 15. Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this
Note shall be cumulative and in addition to all other remedies available under this Note and any of the other Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein
shall limit the Holder’s right to pursue actual and consequential damages actually suffered by the Holder as a result of any failure by the Company to comply with the terms of this Note. The Company acknowledges that a breach by it of its
obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the Holder shall be entitled,
in addition to all other available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required. 
 16. Payment of Collection, Enforcement and Other Costs. If (i) this Note is placed in the hands of an attorney for collection or enforcement
or is collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due under this Note or to enforce the provisions of this Note or (ii) there occurs any bankruptcy, reorganization, receivership of
the Company or other proceedings affecting Company creditors’ rights and involving a claim under this Note, then the Company shall pay the costs incurred by the Holder for such collection, enforcement or action or in connection with such
bankruptcy, reorganization, receivership or other proceeding, including, but not limited to, attorneys’ fees and disbursements. 
 17.
Construction; Headings. This Note shall be deemed to be jointly drafted by the Company and all the Purchasers and shall not be construed against any person as the drafter hereof. The headings of this Note are for convenience of reference and
shall not form part of, or affect the interpretation of, this Note. 
 18. Failure Or Indulgence Not Waiver. No failure or delay on
the part of the Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any
other right, power or privilege. 
 19. Notices; Payments. 
 (a) Notices. Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be given in accordance
with the notice provisions in the Purchase Agreement. Without limiting the 

  

 9 

 
generality of the foregoing, the Company will give written notice to the Holder (i) promptly upon any adjustment of the Conversion Price, setting forth
in reasonable detail, and certifying, the calculation of such adjustment and (ii) at least ten (10) days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon
the Common Stock, (B) with respect to any pro rata subscription offer to holders of Common Stock or (C) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case
that such information shall be made known to the public prior to or in conjunction with such notice being provided to the Holder. 
 (b)
Payments. Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, such payment shall be made in lawful money of the United States of America by a check drawn on the account of the Company and sent via
overnight courier service to such Person at such address as previously provided to the Company in writing (which address, in the case of each of the Purchasers, shall initially be as set forth on the signature page to such Purchaser’s Purchase
Agreement); provided that the Holder may elect to receive a payment of cash via wire transfer of immediately available funds by providing the Company with prior written notice setting out such request and the Holder’s wire transfer
instructions. Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a Business Day, the same shall instead be due on the next succeeding day which is a Business Day. Any amount of Principal or other amounts
due under the Transaction Documents which is not paid when due shall result in a late charge being incurred and payable by the Company in an amount equal to interest on such amount at the rate of two percent (2%) per annum from the date such
amount was due until the same is paid in full (“Late Charge”). 
 20. Cancellation. After all Principal, accrued Late
Charges and other amounts at any time owed on this Note has been paid in full, this Note shall automatically be deemed canceled, shall be surrendered to the Company for cancellation and shall not be reissued. 
 21. Waiver of Notice. To the extent permitted by law, the Company hereby waives demand, notice, protest and all other demands and notices in
connection with the delivery, acceptance, performance, default or enforcement of this Note and the Purchase Agreement. 
 22. Governing
Law. This Note shall be construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Note shall be governed by, the internal laws of the State of New York, without
giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. The Company and
the Holder each hereby irrevocably submit to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action
or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Without
limiting the foregoing, each party agrees that service of process on such party as provided in the Purchase Agreement shall be deemed effective service of process on such party. In the event that any provision of this Note is invalid or
unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision
which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of this Note. Nothing contained herein shall be deemed or operate to preclude the Holder from bringing suit or taking other
legal action against the Company in any other jurisdiction to collect on the Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations, or to enforce a judgment or other court ruling in favor
of the Holder. 
  

 10 

 23. WAIVER OF JURY. THE COMPANY AND THE HOLDER HEREBY IRREVOCABLY WAIVE ANY RIGHT TO, AND AGREE
NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY. 
 24. Certain Definitions. For purposes of this Note, the following terms shall have the following meanings: 
 “Adjustment Transaction” shall have the meaning set forth in Section 6(g). 
 “Alternate
Consideration” shall have the meaning set forth in Section 6(d). 
 “Authorized Share Allocation” shall have
the meaning set forth in Section 9(b). 
 “Authorized Share Failure” shall have the meaning set forth in
Section 9(b). 
 “Bankruptcy Law” shall have the meaning set forth in Section 5(a). 
 “Bloomberg” means Bloomberg Financial Markets (or any successor thereto). 
 “Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed. 
 “Closing Ask Price”, “Closing Bid Price” and “Closing Sale
Price” means, for any security as of any date, the last closing ask price, the last closing bid price and the last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not designate the closing ask price, the closing bid price or the closing trade price, as the case may be, then the ask price, the bid price or the last trade price, respectively, of such
security prior to 4:00:00 p.m., New York Time, as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such security, the last closing ask price, the last closing bid price or the last
trade price, respectively, of such security on the principal securities exchange or trading market where such security is listed or traded as reported by Bloomberg. If the Closing Ask Price, the Closing Bid Price or the Closing Sale Price cannot be
calculated for a security on a particular date on any of the foregoing bases, the Closing Ask Price, the Closing Bid Price or the Closing Sale Price, as the case may be, of such security on such date shall be the fair market value as mutually
determined in good faith by the Board of Directors of the Company and the Holder. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during the applicable
calculation period. 
 “Common Stock” means the common stock, par value $0.0001, of the Company. 
 “Company” shall have the meaning set forth in the Preamble. 
 “Contingent Obligation” means, as to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect
to any indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that such
liability will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto. 
 “Conversion Amount” shall have the meaning set forth in Section 3(b)(i). 
 “Conversion Date” shall have the meaning set forth in Section 3(c)(i). 
 “Conversion Failure” means the Company’s failure, after receipt of a proper conversion notice from the Holder pursuant to
Section 3(c)(i), to issue a certificate to the Holder or credit the Holder’s balance account with DTC for the number of shares of Common Stock to which the Holder is entitled upon conversion of any Conversion Amount on or prior to the date
which is three (3) Business Days after the Conversion Date. 
 “Conversion Notice” shall have the meaning set forth in
Section 3(c)(i). 
  

 11 

 “Conversion Price” shall have the meaning set forth in Section 3(b)(ii).

 “Conversion Rate” shall have the meaning set forth in Section 3(b). 
 “Conversion Shares” means the shares of Common Stock issuable upon conversion of the Notes. 
 “Custodian” shall have the meaning set forth in Section 5(a)(iii). 
 “DTC” shall have the meaning set forth in Section 3(c)(i). 
 “Eligible Market” means the Principal Market, The New York Stock Exchange, Inc., the American Stock Exchange, The Nasdaq Stock Market or
another national securities exchange or quotation system. 
 “Event of Default” shall have the meaning set forth in
Section 5(a). 
 “Exchange Act” shall have the meaning set forth in Section 3(c)(iii). 
 “Expiration Time” shall have the meaning set forth in Section 6(e). 
 “Fundamental Transaction” shall have the meaning set forth in Section 6(d). 
 “Holder” shall have the meaning set forth in the Preamble. 
 “Indebtedness” of any Person means, without duplication (i) all indebtedness for borrowed money, (ii) all obligations issued,
undertaken or assumed as the deferred purchase price of property or services, including (without limitation) “capital leases” in accordance with generally accepted accounting principles (other than trade payables entered into in the
ordinary course of business), (iii) all reimbursement or payment obligations with respect to letters of credit, surety bonds and other similar instruments, (iv) all obligations evidenced by notes, bonds, debentures or similar instruments,
including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses, (v) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing,
in either case with respect to any property or assets acquired with the proceeds of such indebtedness (even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such
property), (vi) all monetary obligations under any leasing or similar arrangement, whether or not classified as a capital lease in accordance with generally accepted accounting principles, (vii) all indebtedness referred to in clauses
(i) through (vi) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any
property or assets (including accounts and contract rights) owned by any Person, even though the Person which owns such assets or property has not assumed or become liable for the payment of such indebtedness, and (viii) all Contingent
Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses (i) through (vii) above. 
 “Issuance Date” shall have the meaning set forth in the Preamble. 
 “Late Charge” shall have the
meaning set forth in Section 19(b). 
 “Maturity Date” shall have the meaning set forth in Section 1. 

“Maximum Percentage” shall have the meaning set forth in Section 3(c)(iii). 
 “NASD” means the National Association of Securities Dealers, Inc., currently known as the Financial Industry Regulatory Authority, Inc.

  

 12 

 “Note” and “Notes” shall have the meaning set forth in the Preamble.

 “Other Notes” shall have the meaning set forth in the Preamble. 
 “Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock or
equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person, the Person with the largest public market capitalization as of the date of consummation of the Fundamental Transaction. 
 “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated
organization, any other entity or any government or any department or agency thereof. 
 “Principal” shall have the meaning
set forth in the Preamble. 
 “Principal Market” means, with respect to the Company as of the Issuance Date, the Nasdaq
Global Select Market. 
 “Purchase Agreement” means the Note Purchase Agreement, dated as of April 20, 2008, by and
among the Company and the Purchasers party thereto, relating to the issuance and sale of the Notes. 
 “Purchased Shares”
shall have the meaning set forth in Section 6(e). 
 “Put Event” shall have the meaning set forth in Section 4(a).

 “Put Notice” shall have the meaning set forth in Section 4(b). 
 “Put Option” shall have the meaning set forth in Section 4(a). 
 “Put Price” shall have the meaning set forth in Section 4(a). 
 “Required Holders” means, at any given time, the holders of Notes representing more than 67% of the aggregate principal amount of the
Notes then outstanding. 
 “Required Reserve Amount” shall have the meaning set forth in Section 9(a). 
 “Restricted Securities” means “restricted securities” within the meaning of the Securities Act for which the applicable holder
has not satisfied the requirements for removing the restrictive legends required by Section 4.5 of the Purchase Agreement as described in Section 5.5 of the Purchase Agreement. 
 “Securities Act” shall mean the Securities Act of 1933, as amended. 
 “Senior Indebtedness” of any Person means any Indebtedness of such Person that by its terms is not made expressly subordinate to other
Indebtedness of such Person. 
 “Share Delivery Date” shall have the meaning set forth in Section 3(c)(i). 

“Significant Subsidiary” shall mean a “significant subsidiary,” as defined in Rule 1-02 of Regulation S-X promulgated by
the SEC, of the Company. 
 “Subsidiaries” of any Person means another Person, an amount of the voting securities, other
voting rights or voting partnership interests of which is sufficient to elect at least a majority of its board of directors or other governing body (or, if there are no such voting interests, 50% or more of the equity interests of which) is owned
directly or indirectly by such first Person. 
  

 13 

 “Successor Entity” means the Person, which may be the Company, formed by, resulting from
or surviving any, Fundamental Transaction or the Person with which such Fundamental Transaction shall have been made; provided that if such Person is not a publicly traded entity whose common stock or equivalent equity security is quoted or
listed for trading on an Eligible Market, Successor Entity shall mean such Person’s Parent Entity of any such Person. 
 “Tender
Announcement Date” shall have the meaning set forth in Section 6(e). 
 “Trading Day” means any day on which
the Common Stock is traded on the Principal Market, or, if the Principal Market is not the principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common Stock is then traded;
provided that “Trading Day” shall not include any day on which the Common Stock is scheduled to trade on such exchange or market for less than four hours or any day that the Common Stock is suspended from trading during the
final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York Time, or such other time as
such exchange or market publicly announces shall be the closing time of trading). 
 “Transaction Documents” means this Note
and the Purchase Agreement relating to this Note. 
 “Transfer Agent” shall have the meaning set forth in
Section 3(c)(i). 
 “Volume Weighted Average Price” means, for any security as of any date, the dollar volume-weighted
average price for such security on the Principal Market during the period beginning at 9:30:01 a.m., New York Time (or such other time as the Principal Market publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York
Time (or such other time as the Principal Market publicly announces is the official close of trading) as reported by Bloomberg through its “Volume at Price” functions, or, if the foregoing does not apply, the dollar volume-weighted average
price of such security in the over-the-counter market on the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York Time (or such other time as such market publicly announces is the official open of
trading), and ending at 4:00:00 p.m., New York Time (or such other time as such market publicly announces is the official close of trading) as reported by Bloomberg. If the Volume Weighted Average Price cannot be calculated for a security on a
particular date on any of the foregoing bases, the Volume Weighted Average Price of such security on such date shall be the fair market value as mutually determined by the Company’s Board of Directors and the Holder. All such determinations to
be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during the applicable calculation period. 
 [Signature Page Follows] 
  

 14 

 IN WITNESS WHEREOF, the Company has caused this Note to be duly executed as of the Issuance Date set
forth above. 
  

			
	BLUE COAT SYSTEMS, INC.
		
	By:	 	 
		 	 Name:
 Title:

  

 15 

 EXHIBIT I 
 BLUE COAT SYSTEMS, INC. 
 CONVERSION NOTICE 
 Reference is made to the Senior Convertible Note (the “Note”) issued to the undersigned by Blue Coat Systems, Inc. (the
“Company”). In accordance with and pursuant to the Note, the undersigned hereby elects to convert the Conversion Amount (as defined in the Note) of the Note indicated below into shares of Common Stock, par value $0.0001 per share
(the “Common Stock”), as of the date specified below. 
 Date of Conversion:                                 
                                        
                                        
                                        
                          
 Aggregate Conversion Amount to be converted:                           
                                        
                                        
                   
 Please confirm the following information:                            
                                        
                                        
                             
 Conversion Price:                                   
                                        
                                        
                                        
                            
 Number of shares of Common Stock to be issued:                        
                                        
                                        
                   
 Please issue the Common Stock into which
the Note is being converted in the following name and to the following address: 
 Issue to:                                    
                                        
                                        
                                        
                                        
      
  
  
  
  
 Facsimile Number:                                   
                                        
                                        
                                        
                          
 Authorization:                                    
                                        
                                        
                                        
                                  
 By:                                      
                                        
                                        
                                        
                                        
             
 Title:                                     
                                        
                                        
                                        
                                        
          
 Dated:                                     
                                        
                                        
                                        
                                        
        
 Account Number:                                   
                                        
                                        
                                        
                            
 (if electronic book entry transfer) 
 Transaction Code Number:                                 
                                        
                                        
                                        
             
 (if electronic book entry transfer) 
  

	 	

 Signature(s) 
  

 16 

 ACKNOWLEDGMENT 
 The Company hereby acknowledges this Conversion Notice and hereby directs the Transfer Agent to issue the above indicated number of shares of Common Stock in accordance with the Transfer Agent instruction letter dated
                , from the Company and acknowledged and agreed to by the Transfer Agent. 
  

			
	BLUE COAT SYSTEMS, INC.
		
	By:	 	 
		 	 Name:
 Title:

 Dated:
                                 
  

 17Note Purchase Agreement dated April 20, 2008

 EXHIBIT 10.01 
 EXECUTION VERSION 
  
  
  
 NOTE PURCHASE AGREEMENT 
 among 
 BLUE COAT SYSTEMS, INC., 

MANCHESTER SECURITIES CORP. 
 and

 FRANCISCO PARTNERS II, L.P. 
  
  
 Dated: April 20, 2008

  

 Table of Contents 
  

					
		  		  	Page
	 NOTE PURCHASE AGREEMENT
	  	1
		
	 ARTICLE I DEFINITIONS
	  	1
	 Section 1.1
	  	Definitions	  	1
		
	 ARTICLE II PURCHASE AND SALE OF NOTES
	  	4
	 Section 2.1
	  	Purchase and Sale of Notes and Issuance of Warrants	  	4
	 Section 2.2
	  	Closing	  	5
		
	 ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY
	  	5
	 Section 3.1
	  	Corporate Existence and Power	  	5
	 Section 3.2
	  	Authorization; No Contravention	  	5
	 Section 3.3
	  	Governmental Authorization	  	6
	 Section 3.4
	  	Binding Effect	  	6
	 Section 3.5
	  	Litigation	  	6
	 Section 3.6
	  	Capitalization	  	6
	 Section 3.7
	  	Merger Agreement	  	7
	 Section 3.8
	  	Public Filings	  	7
	 Section 3.9
	  	Financial Statements; Undisclosed Liabilities	  	7
	 Section 3.10
	  	Absence of Changes	  	8
	 Section 3.11
	  	Broker’s, Finder’s or Similar Fees	  	8
	 Section 3.12
	  	Acknowledgment Regarding Purchaser’s Purchase of Securities	  	8
	 Section 3.13
	  	No General Solicitation	  	8
	 Section 3.14
	  	No Integrated Offering	  	8
	 Section 3.15
	  	Application of Takeover Protections; Rights Agreement	  	8
	 Section 3.16
	  	Insolvency	  	8
	 Section 3.17
	  	Form S-3 Eligibility	  	9
		
	 ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
	  	9
	 Section 4.1
	  	Existence and Power	  	9
	 Section 4.2
	  	Authorization; No Contravention	  	9
	 Section 4.3
	  	Governmental Authorization; Third Party Consents	  	9
	 Section 4.4
	  	Binding Effect	  	10
	 Section 4.5
	  	Acquisition for Own Account	  	10
	 Section 4.6
	  	Restricted Securities	  	10
	 Section 4.7
	  	Litigation	  	10
	 Section 4.8
	  	Broker’s, Finder’s or Similar Fees	  	11
	 Section 4.9
	  	Accredited Investor	  	11
	 Section 4.10
	  	Beneficial Ownership of Voting Stock	  	11
	 Section 4.11
	  	Availability of Funds	  	11
	 Section 4.12
	  	No Other Representations	  	11
		
	 ARTICLE V ADDITIONAL AGREEMENTS
	  	11
	 Section 5.1
	  	Use of Proceeds	  	11
	 Section 5.2
	  	Public Information; Registration Rights	  	11
	 Section 5.3
	  	Lock-Up	  	12
	 Section 5.4
	  	Removal of Legend	  	12
	 Section 5.5
	  	Adjustments	  	12
		
	 ARTICLE VI CLOSING CONDITIONS
	  	13
	 Section 6.1
	  	Conditions of each Purchaser	  	13
	 Section 6.2
	  	Conditions of the Company	  	13

					
		
	 ARTICLE VII TERMINATION OF AGREEMENT AND REMEDIES
	  	14
	 Section 7.1
	  	Termination	  	14
	 Section 7.2
	  	Effect of Termination	  	14
	 Section 7.3
	  	Remedies	  	15
		
	 ARTICLE VIII MISCELLANEOUS
	  	15
	 Section 8.1
	  	Governing Law; Disputes	  	15
	 Section 8.2
	  	WAIVER OF JURY TRIAL	  	15
	 Section 8.3
	  	Entire Agreement; Amendment	  	15
	 Section 8.4
	  	Waiver	  	15
	 Section 8.5
	  	Successors and Assigns	  	15
	 Section 8.6
	  	Invalid Provisions	  	16
	 Section 8.7
	  	Headings	  	16
	 Section 8.8
	  	Survival	  	16
	 Section 8.9
	  	Further Assurances	  	16
	 Section 8.10
	  	Counterparts	  	16
	 Section 8.11
	  	Notices	  	16
	 Section 8.12
	  	Expenses	  	17
	 Section 8.13
	  	Publicity; Confidentiality	  	17
	 Section 8.14
	  	Indemnification	  	17
			
	 Exhibit
	  		  	
	 Exhibit A
	  	Form of Note	  	
	 Exhibit B
	  	Form of Warrant	  	
			
	 Schedule
	  		  	
	 Schedule 2.1
	  	Principal Amount and Purchase Price of Notes	  	
	 Schedule 2.2
	  	Number of Shares per Warrant	  	

  

 ii 

 NOTE PURCHASE AGREEMENT 
 NOTE PURCHASE AGREEMENT, dated as of April 20, 2008 (this “Agreement”), by and among Blue Coat Systems, Inc., a Delaware
corporation (the “Company”), Manchester Securities Corp., a New York corporation (“Manchester”), Francisco Partners II, L.P., a Delaware limited partnership (“FP” and, together with Manchester the
“Purchasers”). 
 WHEREAS, concurrently with the execution of this Agreement, the Company, Cooper Acquisition, Inc., a
Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub”), and Packeteer, Inc., a Delaware corporation (“Target”), are entering into an Agreement and Plan of Merger, dated as of April 20, 2008
(as amended, the “Merger Agreement”), providing for the commencement and conduct of the Offer (as defined below) and, following consummation of the Offer, the merger of Merger Sub with and into Target, with Target continuing as the
surviving corporation and as a wholly owned subsidiary of the Company (the “Merger”); 
 WHEREAS, the Company proposes to
issue and sell to each of the Purchasers, promptly following the Offer Acceptance, Zero Coupon Senior Convertible Notes due 2013 of the Company (the “Notes”) in the aggregate principal amount set forth opposite the name of such
Purchaser on Schedule 2.1 hereto for the aggregate purchase price set forth opposite such Purchaser’s name on Schedule 2.1 hereto, upon the terms and subject to the conditions of this Agreement; 
 WHEREAS, the Company proposes to issue to each of the Purchasers, promptly following the Offer Acceptance, a Warrant of the Company (the
“Warrants”) exercisable for the number of shares of Common Stock (as defined below) set forth opposite the name of such Purchaser on Schedule 2.2 hereto, upon the terms and subject to the conditions of this Agreement;

 NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: 
 ARTICLE I 
 DEFINITIONS 
 Section 1.1 Definitions.

 (a) As used in this Agreement, and unless the context requires a different meaning, the following terms have the meanings indicated:

 “Acceptance Date” shall mean the date on which Offer Acceptance occurs. 
 “Acquired Securities” means the Notes, the Conversion Shares issuable upon conversion of the Notes, the Warrants and the Warrant Shares.

 “Affiliate” means (i) with respect to any Person, any other Person that controls, is controlled by, or is under
common control with such Person; (ii) with respect to any natural Person, (a) any spouse, lineal descendant, sibling or parent, or (b) any trust established solely for the benefit of such natural Person and/or any of the Persons set
forth in the foregoing clause (a); and (iii) with respect to any Person that is a trust whose sole beneficiaries are individuals, such individuals and their lineal descendants. For the purpose of this definition, the term
“control” (including with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise. 
 “Agreement” means this Agreement as the same may be amended, supplemented or modified in accordance with the terms hereof. 

 “Beneficially Own” and “Beneficial Ownership” shall have the meaning set forth
in Rule 13d-3 of the rules and regulations promulgated under the Exchange Act, except that for purposes of this Agreement, the words “within sixty days” in Rule 13d-3(d)(1)(i) shall not apply, to the effect that a Person shall be deemed to
be the beneficial owner of a security if that Person has the right to acquire beneficial ownership of such security at any time. 
 “Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed. 
 “Common Stock” means the common stock, par value $0.0001, of the Company. 
 “Company Material Adverse Effect” means a material adverse effect on the business, financial condition or results of operations of the
Company and its Subsidiaries, taken as a whole, provided however that none of the following shall be deemed either alone or in combination, in and of themselves, to be a Company Material Adverse Effect: (i) except with respect to
Section 3.2, any adverse effect resulting from or arising out of the Merger Agreement or the Transaction Documents, the announcement or pendency thereof or the consummation of the transactions contemplated thereby, (ii) changes,
circumstances or conditions generally affecting the industry in which the Company and its Subsidiaries operate to the extent they do not disproportionately affect the Company or its Subsidiaries, (iii) changes in general economic or political
conditions or in the financial markets to the extent they do not disproportionately affect the Company or its Subsidiaries, (iv) changes in law or accounting principles to the extent they do not disproportionately affect the Company or its
Subsidiaries, (v) any actions required to be taken by any Transaction Document or the Merger Agreement, (vi) any Proceeding initiated by any Person (other than a Governmental Authority or any party to the Merger Agreement or any
Transaction Documents) arising out of or related to any Transaction Document or the Merger Agreement or any transaction contemplated thereby, including such a Proceeding made or brought by any holder of Common Stock (on the holder’s own behalf,
or on behalf of the Company), (vii) any Proceeding disclosed in the Company SEC Documents filed prior to the date hereof under the caption “Legal Proceedings” or in the notes to the financial statements contained therein
(“Disclosed Proceeding”) or any Proceeding relating to or arising out of the facts and circumstances at issue in such Disclosed Proceeding to the extent the facts and circumstances are disclosed in Company SEC Documents filed prior
to the date hereof or have been disclosed to the Purchasers prior to the date hereof, (viii) any natural disaster or any acts of terrorism, sabotage, military action or war or any escalation or worsening thereof to the extent the same does not
disproportionately affect the Company or its Subsidiaries, (ix) the failure of the Company to meet internal or analysts’ expectations or projections or (x) the Company’s revenues or results of operations for the three months
ended April 30, 2008, except to the extent such revenues are materially lower than those previously disclosed to Purchasers prior to the date hereof. 
 “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC thereunder. 
 “Governmental Authority” means any foreign, federal, state or local court, administrative body or other governmental or
quasi-governmental entity with competent jurisdiction. 
 “Knowledge” means, with respect to any Person, the actual
knowledge of the executive officers of such Person. 
 “Legal Requirement” means any law, statute, treaty, rule, regulation,
determination of an arbitrator, a court or other Governmental Authority or a stock exchange. 
 “Lien” means any mortgage,
deed of trust, pledge, hypothecation, assignment, encumbrance, lien (statutory or other) or preference, priority, right or other security interest or preferential arrangement of any kind or nature whatsoever. 
  

 2 

 “Offer” shall have the meaning set forth in the Merger Agreement. 
 “Offer Acceptance” means the acceptance for payment by Merger Sub of shares of common stock of Target validly tendered and not withdrawn
in the Offer, following the final expiration of the Offer (without giving effect to any Subsequent Offer Period). 
 “Permitted
Transferee” means, with respect to any Purchaser, (A) any fund or co-investment partnership managed by an Affiliate of such Purchaser (a “Purchaser Fund”), (B) any general or limited partner of any Purchaser or
any Purchaser Fund (collectively, a “Purchaser Partner”), and any corporation, partnership or other entity that is an Affiliate of any Purchaser Partner (collectively, “Purchaser Affiliates”), (C) any managing
director, general partner, director, limited partner, officer or employee of any Purchaser, any Purchaser Fund, any Purchaser Partner or any Purchaser Affiliate, or any spouse, lineal descendant, sibling, parent, heir, executor, administrator,
testamentary trustee, legatee or beneficiary of any of the foregoing persons described in this clause (C) (collectively, “Purchaser Associates”), or (D) any trust, the beneficiaries of which, any charitable trust, the
grantor of which, or any corporation, limited liability company or partnership, the stockholders, members or general or limited partners of which include only the Purchaser, Purchaser Funds, Purchaser Partners, Purchaser Affiliates, Purchaser
Associates, their spouses or their lineal descendants. 
 “Person” means any individual, firm, corporation, partnership,
trust, incorporated or unincorporated association, joint venture, joint stock company, limited liability company, Governmental Authority or other entity of any kind. 
 “Proceeding” means any suit, claim, action, litigation, arbitration, proceeding (including any civil, criminal, administrative, investigative or appellate proceeding), hearing, audit, review,
examination or investigation commenced, brought, conducted or heard by or before, or otherwise involving, any court or other Governmental Authority or any arbitrator or arbitration panel. 
 “SEC” means the United States Securities and Exchange Commission. 
 “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the SEC thereunder. 
 “Subsidiary” of any Person means another Person, an amount of the voting securities, other voting rights or voting partnership interests
of which is sufficient to elect at least a majority of its board of directors or other governing body (or, if there are no such voting interests, 50% or more of the equity interests of which) is owned directly or indirectly by such first Person.

 “Transaction Documents” means, collectively, this Agreement, the Notes and the Warrants. 
 “Voting Stock” means any securities of any class or kind ordinarily having the power to vote generally for the election of directors,
managers or other voting members of the governing body of the Company or any successor thereto. 
 “Warrant Shares” means
the shares of Common Stock issuable upon exercise of the Warrants. 
 (b) For purposes of this Agreement, except as otherwise expressly
provided herein or unless the context otherwise requires: (a) words using the singular or plural number also include the plural or singular number, respectively, and the use of any gender herein shall be deemed to include the other genders;
(b) references herein to “Articles,” “Sections,” “subsections” and other subdivisions, and to Exhibits, Annexes and other attachments, without reference to a document are to the specified Articles, Sections,
subsections and other subdivisions of, and Exhibits, Annexes and other attachments to, this Agreement; (c) references to “Schedules” are references to the disclosure schedules delivered in connection with this Agreement, (d) a
reference to a subsection without further 

  

 3 

 
reference to a Section is a reference to such subsection as contained in the same Section in which the reference appears, and this rule shall also
apply to other subdivisions within a Section or subsection; (e) the words “herein,” “hereof,” “hereunder,” “hereby” and other words of similar import refer to this Agreement as a whole and not to any
particular provision; and (f) the words “include,” “includes” and “including” are deemed to be followed by the phrase “without limitation”. 
 (c) The following capitalized terms are defined in the following Sections of this Agreement: 
  

			
	 Term
	  	Section
	 ACT
	  	Section 4.5(a)
	 Agreement
	  	Preamble
	 Cautionary Disclosures
	  	Section 3.9
	 Claims
	  	Section 3.5
	 Closing
	  	Section 2.2
	 Closing Date
	  	Section 2.2
	 Company
	  	Preamble
	 Company SEC Documents
	  	Section 3.8
	 Contractual Obligation
	  	Section 3.2(a)
	 Conversion Shares
	  	Section 3.2(a)
	 FP
	  	Preamble
	 GAAP
	  	Section 3.9
	 HSR Act
	  	Section 3.3
	 Indemnified Liabilities
	  	Section 8.14
	 Indemnitees
	  	Section 8.14
	 Insolvent
	  	Section 3.16
	 Lock-up Period
	  	Section 5.3
	 Manchester
	  	Preamble
	 Merger
	  	Recitals
	 Merger Agreement
	  	Preamble
	 Merger Agreement
	  	Recitals
	 Merger Sub
	  	Preamble
	 Merger Sub
	  	Recitals
	 Notes
	  	Preamble
	 Notes
	  	Recitals
	 Orders
	  	Section 3.2(a)
	 Purchaser Affiliates
	  	Section 1.1(a)
	 Purchaser Associates
	  	Section 1.1(a)
	 Purchaser Fund
	  	Section 1.1(a)
	 Purchaser Partner
	  	Section 1.1(a)
	 Purchasers
	  	Preamble
	 Registration Statement
	  	Section 5.2
	 Restricted Securities
	  	Section 5.3
	 Target
	  	Recitals
	 Transfer
	  	Section 5.3

 ARTICLE II 
 PURCHASE AND SALE OF NOTES 
 Section 2.1 Purchase and Sale of Notes and Issuance of Warrants. Subject
to the terms and conditions herein set forth, at the Closing, each Purchaser agrees to purchase from the Company and the Company agrees to issue and sell to each Purchaser, the aggregate principal amount of Notes set forth opposite such
Purchaser’s 

  

 4 

 
name on Schedule 2.1, for the aggregate purchase price set forth opposite such Purchaser’s name on Schedule 2.1 and Warrants to
purchase the number of Warrant Shares set forth opposite such Purchaser’s name on Schedule 2.2. The Notes shall be issued substantially in the form attached hereto as Exhibit A and the Warrants shall be issued substantially
in the form attached hereto as Exhibit B, in each case as such form may be modified with the written consent of all Purchasers. At the Closing: (i) each Purchaser shall deliver the purchase price payable by such Purchaser to the
Company by wire transfer of immediately available funds to an account designated by the Company at least one Business Day prior to the Closing Date and (ii) the Company shall deliver to each Purchaser one or more duly executed and validly
issued Notes registered in the name of the Purchaser, representing the aggregate principal amount of the Notes set forth opposite such Purchaser’s name on Schedule 2.1, free and clear of all Liens, taxes and charges in respect of
the issuance thereof and one or more duly executed and validly issued Warrants registered in the name of the Purchaser, representing the aggregate number of Warrant Shares set forth opposite such Purchaser’s name on Schedule 2.2,
free and clear of all Liens, taxes and charges in respect of the issuance thereof. 
 Section 2.2 Closing. Unless this Agreement shall
have terminated pursuant to ARTICLE VII, and subject to the satisfaction or waiver of the conditions set forth in ARTICLE VI, the closing of the transactions contemplated hereby (the “Closing”) shall take place at the offices of
Davis Polk & Wardwell, 1600 El Camino Real, Menlo Park, CA 94025, at 10:00 a.m., local time, on the Acceptance Date, or at such other time, place and date that the Company and all of the Purchasers may agree in writing (the
“Closing Date”). 
 ARTICLE III 
 REPRESENTATIONS AND WARRANTIES OF THE COMPANY 
 The Company represents and warrants to each of the
Purchasers, as of the date hereof and as of the Closing Date, as follows: 
 Section 3.1 Corporate Existence and Power. The Company
(a) is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware; (b) has all requisite power and authority to own and operate its property, to lease the property it operates as lessee and
to conduct the business in which it is currently, or is proposed to be, engaged; and (c) is duly qualified as a foreign corporation and in good standing under the laws of each jurisdiction in which its ownership, lease or operation of property
or the conduct of its business requires such qualification, except to the extent such failure to be so qualified would not reasonably be expected to have Company Material Adverse Effect or a material adverse effect on the ability of the Company to
consummate the transactions contemplated by the Transaction Documents or to comply with its obligations thereunder. The Company has the corporate power and authority to execute, deliver and perform its obligations under the Transaction Documents and
the Registration Rights Agreements. 
 Section 3.2 Authorization; No Contravention. 
 (a) The execution, delivery and performance by the Company of each Transaction Document and the Registration Rights Agreements (as defined below) and the
transactions contemplated thereby (excluding, for purposes of this Section 3.2, the consummation of the Offer and the Merger but including the issuance of shares of Common Stock upon conversion of Notes (the “Conversion
Shares”) and including the issuance of the Warrant Shares upon exercise of the Warrants): (i) have been duly authorized by all necessary corporate action of the Company, including by the Board of Directors excluding Keith Geeslin;
(ii) do not contravene the terms of the Company’s or any of its Subsidiaries’ certificate of incorporation or bylaws or any other governing or organizational documents; (iii) do not violate, conflict with or result in any breach,
default or contravention of (or with due notice or lapse of time or both would result in any breach, default or contravention of), or the creation of any Lien under, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation (each a “Contractual Obligation”) to which the Company or any of its Subsidiaries 

  

 5 

 
is party or by which any of their respective assets are bound or, subject to compliance with the matters addressed in Section 3.3, any Legal Requirement
applicable to the Company or any of its Subsidiaries; and (iv) do not violate any judgment, injunction, writ, award, decree or order (collectively, “Orders”) of any Governmental Authority against, or binding upon, the Company,
any of its Subsidiaries or any of their respective assets, except, in the case of clauses (iii) and (iv), as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect or a material adverse
effect on the ability of the Company to consummate the transactions contemplated by the Transaction Documents or to comply with its obligations thereunder. 
 (b) Prior to the date of this Agreement, the Board of Directors excluding Keith Geeslin has (a) determined that this Agreement is advisable and in the best interests of the Company and the stockholders of the
Company and (b) approved the transactions contemplated by this Agreement. 
 (c) As of the Closing, 4,450,867 shares of Common Stock
shall have been duly authorized and reserved for issuance (which number of shares equals 105% of the maximum number of shares of Common Stock issuable upon conversion of the Notes at the initial Conversion Rate (as defined in the Notes) and upon
issuance of the Warrants at the initial Exercise Price (as defined in the Warrants). 
 Section 3.3 Governmental Authorization.
Assuming the accuracy of the representations and warranties of the other parties hereto, no approval, consent, compliance, exemption, authorization or other action by, or notice to, or filing with, any Governmental Authority is necessary or required
in connection with the execution, delivery or performance by, or enforcement against, the Company of the Transaction Documents or the transactions contemplated thereby (excluding, for purposes of this Section 3.3, the consummation of the Offer
and the Merger but including the issuance of Conversion Shares upon the conversion of Notes), except for (i) compliance with the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”) in connection
with the issuance of Conversion Shares upon conversion of the Notes and the issuance of the Warrant Shares upon exercise of the Warrants and (ii) compliance with the Exchange Act and other applicable securities laws. Assuming the accuracy of
the representations and warranties of the other parties hereto, the offer and issuance by the Company of the Acquired Securities is exempt from registration under the Securities Act. 
 Section 3.4 Binding Effect. This Agreement has been and, when executed and delivered by the Company, each of the other Transaction Document and
the Registration Rights Agreements will have been, duly executed and delivered by the Company, and this Agreement constitutes and, when executed and delivered by the Company, the other Transaction Document and the Registration Rights Agreements will
constitute, the legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance or transfer,
moratorium or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability (regardless of whether considered in a proceeding at law or in equity) (collectively, the
“Enforceability Exceptions”). 
 Section 3.5 Litigation. As of the date hereof, there are no actions, suits,
proceedings, claims, complaints, disputes, arbitrations or investigations (collectively, “Claims”) pending or, to the Knowledge of the Company, threatened, at law, in equity, in arbitration or by or before any Governmental Authority
against or involving the Company, Merger Sub or their respective assets which seek to enjoin or restrain the execution, delivery or performance of any of the Transaction Documents by the Company. As of the date hereof, no Order has been issued by
any court or other Governmental Authority against the Company purporting to enjoin or restrain the execution, delivery or performance of any of the Transaction Documents by the Company. 
 Section 3.6 Capitalization. 
 (a) The
authorized capital stock of the Company consists of 200,000,000 shares of Common Stock and 10,000,000 shares of preferred stock, par value $0.0001 per share. As of the close of business on April 17, 2008: (i) 38,244,947 shares of Common
Stock were issued and outstanding; (ii) 276,473 shares of Common Stock were 

  

 6 

 
held by the Company in its treasury and (iii) 3,461,650 shares of Common Stock were reserved and available for issuance upon exercise of Company
employee stock options or otherwise pursuant to employee stock incentive plans of the Company. Except as provided in this Section 3.6(a), or as otherwise contemplated by this Agreement, the other Transaction Documents or the Merger Agreement,
(i) there are no shares of capital stock or other voting securities or equity interests of the Company issued, reserved for issuance or outstanding and no options, warrants, conversion privileges, subscription or purchase rights or other rights
to purchase or otherwise acquire capital stock or other securities of the Company and (ii) there are no agreements on the part of the Company or any of its Subsidiaries to issue, sell or distribute any of its capital stock or other securities.

 (b) All of the Conversion Shares and Warrant Shares shall, when issued, be validly issued, fully paid and non-assessable and will be free
and clear of all Liens, other than any Liens created by the recipient thereof or under this Agreement or any other Transaction Document or under applicable securities laws, and not issued in violation of or subject to any preemptive rights or other
rights to subscribe for or purchase securities. No preemptive rights, rights of first refusal, securities issuance participation rights or other rights exist to subscribe for, purchase, or otherwise participate, with respect to the issuance and sale
of the Notes by the Company pursuant to this Agreement, the issuance of the Conversion Shares pursuant to the terms of the Notes, the issuance of the Warrants by the Company pursuant to this Agreement, the issuance of the Warrant Shares pursuant to
the terms of the Warrants and this Agreement. No further approval or authority of the stockholders or the Company’s Board of Directors will be required for the issuance and sale of the Notes, Conversion Shares, Warrants or Warrant Shares by the
Company as contemplated herein (even after taking into consideration any assumption of equity incentive awards and issuance of securities pursuant to the Merger Agreement). 
 Section 3.7 Merger Agreement. Upon execution and delivery of the Merger Agreement, the Merger Agreement will be valid and in full force and effect
and enforceable against the Company, Merger Sub and Target, in accordance with its terms, except as enforceability may be limited by Enforceability Exceptions. The representations and warranties of the Company and Merger Sub set forth in Article 6
of the Merger Agreement are true and correct as of the date hereof. 
 Section 3.8 Public Filings. The Company has filed all required
reports, schedules, forms, statements and other documents with the SEC since January 1, 2007 (collectively, the “Company SEC Documents”). As of its filing date, each Company SEC Document complied, and each such Company SEC
Document filed subsequent to the date hereof and prior to the Closing Date will comply, as to form in all material respects with the applicable requirements of the Securities Act and the Exchange Act, as the case may be. As of its filing date, each
Company SEC Document filed pursuant to the Exchange Act did not, and each such Company SEC Document filed subsequent to the date hereof and prior to the Closing Date will not, contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading, except that information as of a later date (but, prior to the date hereof) shall be deemed to modify
information as of an earlier date. 
 Section 3.9 Financial Statements; Undisclosed Liabilities. The audited consolidated financial
statements and unaudited consolidated interim financial statements of the Company included in the Company SEC Documents fairly present, in conformity with generally accepted accounting principles (“GAAP”) applied on a consistent
basis (except as may be indicated in the notes thereto), the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof and their consolidated results of operations and cash flows for the periods then
ended (subject, in the case of interim financial statements, to the condensation or omission of certain information and footnote disclosures as permitted under the Exchange Act). There are no liabilities or obligations of the Company or any of its
Subsidiaries of any kind whatsoever, whether accrued, contingent, absolute, determined, determinable or otherwise, other than liabilities or obligations disclosed and provided for in the financial statements included in the Company SEC Documents
filed prior to the date hereof or as otherwise fairly disclosed in the Company SEC Documents filed prior to the date hereof (excluding, in each case, any disclosures set forth in any risk factor section, in any section relating to forward-looking
statements and any other disclosures included therein, in each case to the extent that they are cautionary, predictive or forward- 

  

 7 

 
looking in nature (such disclosures, collectively, the “Cautionary Disclosures”)), liabilities incurred in the ordinary course of business
since January 31, 2008 and liabilities or obligations that have not had and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect. 
 Section 3.10 Absence of Changes. Since January 31, 2008, except as fairly disclosed in the Company SEC Documents filed prior to the date
hereof (excluding any Cautionary Disclosures), the business of the Company and its Subsidiaries has been conducted in the ordinary course consistent with past practices and there has not been any event, occurrence or development that has had or
would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect. 
 Section 3.11 Broker’s,
Finder’s or Similar Fees. There are no brokerage commissions, finder’s fees or similar fees or commissions payable by the Purchasers or any of their Affiliates in connection with the transactions contemplated by any Transaction
Document, based on any agreement, arrangement or understanding with the Company or any of its Affiliates. 
 Section 3.12 Acknowledgment
Regarding Purchaser’s Purchase of Securities. The Company acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the
transactions contemplated hereby and thereby, and any advice given by a Purchaser or any of its representatives or agents in connection with the Transaction Documents and the transactions contemplated hereby and thereby is merely incidental to such
Purchaser’s purchase of the Acquired Securities. The Company further represents to each Purchaser that the Company’s decision to enter into the Transaction Documents has been based solely on the independent evaluation by the Company and
its representatives. 
 Section 3.13 No General Solicitation. Neither the Company, nor any of its Affiliates, nor any Person acting on
its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D under the Securities Act) in connection with the offer or sale of the Acquired Securities. 
 Section 3.14 No Integrated Offering. None of the Company, its Subsidiaries, any of their Affiliates, and any Person acting on their behalf has,
directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would require registration of any of the Acquired Securities under the Securities Act or cause this offering of
the Acquired Securities to be integrated with prior offerings by the Company for purposes of the Securities Act or any applicable stockholder approval provisions, including, without limitation, under the rules and regulations of any exchange or
automated quotation system on which any of the securities of the Company are listed or designated. None of the Company, its Subsidiaries, their Affiliates and any Person acting on their behalf will take any action or steps referred to in the
preceding sentence that would require registration of any of the Acquired Securities under the Securities Act or cause the offering of the Acquired Securities to be integrated with other offerings. 
 Section 3.15 Application of Takeover Protections; Rights Agreement. The Company and the Board of Directors of the Company have taken all necessary
action, if any, in order to render inapplicable any control share acquisition, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Company’s certificate of incorporation or the
laws of the jurisdiction of its formation which is or could become applicable to any Purchaser as a result of the transactions contemplated by this Agreement, including, without limitation, the Company’s issuance of the Acquired Securities and
any Purchaser’s ownership of the Acquired Securities. 
 Section 3.16 Insolvency. The Company has not taken any steps to seek
protection pursuant to any bankruptcy law nor does the Company have any knowledge or reason to believe that its creditors intend to initiate involuntary bankruptcy proceedings or any actual knowledge of any fact which would reasonably lead a
creditor to do so. For purposes of this Section 3.16, “Insolvent” means (i) the present fair saleable value of the Company’s assets is less than the amount required to pay the Company’s total indebtedness,
(ii) the Company is 

  

 8 

 
unable to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured, (iii) the
Company intends to incur or believes that it will incur debts that would be beyond its ability to pay as such debts mature or (iv) the Company has unreasonably small capital with which to conduct the business in which it is engaged as such
business is now conducted and is proposed to be conducted. 
 Section 3.17 Form S-3 Eligibility. As of the date hereof, the Company is
eligible to register the Conversion Shares and Warrant Shares for resale by the Purchaser using Form S-3 promulgated under the Securities Act. 
 ARTICLE IV 
 REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS 
 Each of the Purchasers hereby represents and warrants, for itself only and not jointly or severally with any other Purchaser, to the Company, as of the
date hereof and as of the Closing Date, as follows: 
 Section 4.1 Existence and Power. Such Purchaser (a) is a corporation or
other legal entity duly organized, validly existing and in good standing under the laws of its jurisdiction of formation; (b) has all requisite power and authority to own and operate its property, to lease the property it operates as lessee and
to conduct the business in which it is currently, or is proposed to be, engaged; and (c) is duly qualified as a foreign corporation and in good standing under the laws of each jurisdiction in which its ownership, lease or operation of property
or the conduct of its business requires such qualification, except to the extent such failure to be so qualified would not reasonably be expected to have a material adverse effect on the ability of such Purchaser to consummate the transactions
contemplated by the Transaction Documents to which such Purchaser is or is to be made a party or to comply with its obligations thereunder. Such Purchaser has the power and authority to execute, deliver and perform its obligations under the
Transaction Documents to which it is or is to be made a party. 
 Section 4.2 Authorization; No Contravention. The execution, delivery
and performance by such Purchaser of the Transaction Documents and the transactions contemplated thereby (excluding, for purposes of this Section 4.2, the consummation of the Offer and the Merger but including the issuance of Conversion Shares
upon the conversion of Notes and the issuance of the Warrant Shares upon exercise of the Warrants), (a) have been duly authorized by all necessary organizational action of such Purchaser, (b) do not contravene the terms of such
Purchaser’s governing or organizational documents, and (c) do not violate, conflict with or result in any breach, default or contravention of (or with due notice or lapse of time or both would not result in any breach, default or
contravention of), or the creation of any Lien under, any Contractual Obligation to which such Purchaser is party or by which any of its assets are bound or, subject to compliance with the matters addressed in Section 4.3, any Legal Requirement
applicable to such Purchaser and (d) do not violate any Orders of any Governmental Authority against, or binding upon, such Purchaser or its assets, except, in the case of clauses (c) and (d), as would not, individually or in the
aggregate, reasonably be expected to have material adverse effect on the ability of such Purchaser to consummate the transactions contemplated by the Transaction Documents to which such Purchaser is or will be made a party or to comply with its
obligations thereunder. 
 Section 4.3 Governmental Authorization; Third Party Consents. Assuming the accuracy of the representations
and warranties of the other parties hereto, no approval, consent, compliance, exemption, authorization or other action by, or notice to, or filing with, any Governmental Authority is necessary or required in connection with the execution, delivery
or performance by, or enforcement against, such Purchaser of the Transaction Documents or the transactions contemplated thereby (excluding, for purposes of this Section 4.3, the consummation of the Offer and the Merger but including the
issuance of Conversion Shares upon the conversion of Notes and the issuance of the Warrant Shares upon exercise of the Warrants), except for (i) compliance with the HSR Act in connection with the issuance of Conversion Shares upon conversion of
the Notes and (ii) compliance with the Exchange Act and other applicable securities laws. 
  

 9 

 Section 4.4 Binding Effect. This Agreement has been and, when executed and delivered by such
Purchaser, the other Transaction Document to which such Purchaser is to be made a party will have been, duly executed and delivered by such Purchaser and this Agreement constitutes and, when executed and delivered by such Purchaser, such other
Transaction Document will constitute, the legal, valid and binding obligations of such Purchaser, enforceable against it in accordance with its terms, except as enforceability may be limited by the Enforceability Exceptions. 
 Section 4.5 Acquisition for Own Account. The Acquired Securities to be acquired by such Purchaser pursuant to this Agreement are being acquired
for its own account and with no intention of distributing or reselling such Acquired Securities or any part thereof in any transaction that would be in violation of the securities laws of the United States of America or any state of the United
States, without prejudice, however, to the rights of such Purchaser at all times (subject to the terms of the Transaction Documents and the Registration Rights Agreements) to sell or otherwise dispose of all or any part of such Acquired Securities
in a transaction that does not violate the Securities Act under an effective registration statement under the Securities Act, or under an exemption from such registration available under the Securities Act. If such Purchaser should in the future
decide to dispose of any of such Acquired Securities, such Purchaser understands and agrees that it may do so only in compliance with the Transaction Documents, the Registration Rights Agreements and the Securities Act and applicable state and
foreign securities laws, as then applicable and in effect. Such Purchaser agrees to the imprinting of a legend on certificates representing all of its Acquired Securities to the following effect: 
 “THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A NOTE PURCHASE AGREEMENT DATED AS OF APRIL 20, 2008, BY AND AMONG THE ISSUER AND THE
OTHER PERSONS NAMED THEREIN, AS SUCH AGREEMENT MAY BE AMENDED, RESTATED OR MODIFIED FROM TIME TO TIME, AND MAY NOT BE TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE WITH THE PROVISIONS THEREOF, AND
ANY TRANSFEREE OF THESE SECURITIES SHALL BE SUBJECT TO THE TERMS OF SUCH AGREEMENT. COPIES OF SUCH AGREEMENT ARE MAINTAINED WITH THE CORPORATE RECORDS OF THE ISSUER AND ARE AVAILABLE FOR INSPECTION AT THE PRINCIPAL OFFICES OF THE ISSUER.”

 “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD OR TRANSFERRED EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, AND IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS OR (II) AN
APPLICABLE EXEMPTION FROM REGISTRATION UNDER THE ACT AND UNDER APPLICABLE STATE SECURITIES LAWS.” 
 Section 4.6 Restricted
Securities. Such Purchaser understands that (i) the Acquired Securities will not be registered at the time of their issuance under the Securities Act for the reason that the sale provided for in this Agreement is exempt pursuant to
Section 4(2) of the Securities Act, (ii) the reliance of the Company on such exemption is predicated in part on such Purchaser’s representations set forth herein, and (iii) such Acquired Securities must be held indefinitely
unless a subsequent disposition thereof is registered under the Securities Act or is exempt from registration. Such Purchaser acknowledges that the Company has no obligation to register or qualify the Acquired Securities, except as provided herein.
Such Purchaser acknowledges that no public market now exists for the Notes, and that the Company has given no assurance that a public market will ever exist. 
 Section 4.7 Litigation. As of the date hereof, there are no Claims pending or, to the Knowledge of such Purchaser, threatened, at law, in equity, in arbitration or by or before any Governmental Authority
against or involving such Purchaser or its assets, which seek to enjoin or restrain the execution, delivery or performance of any of the Transaction Documents by such Purchaser. No Order has been issued by any court or other Governmental Authority
against such Purchaser purporting to enjoin or restrain the execution, delivery or performance of any of the Transaction Documents by such Purchaser. 
  

 10 

 Section 4.8 Broker’s, Finder’s or Similar Fees. There are no brokerage commissions,
finder’s fees or similar fees or commissions payable by the Company or any of its Affiliates in connection with the transactions contemplated by any Transaction Document, based on any agreement, arrangement or understanding with such Purchaser
or any of its Affiliates. 
 Section 4.9 Accredited Investor. Such Purchaser has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of the transactions contemplated by this Agreement and the other Transaction Documents, has the ability to bear the economic risks of the investment and is an “accredited
investor” as defined in Rule 501 of Regulation D, promulgated under the Securities Act. 
 Section 4.10 Beneficial Ownership of
Voting Stock. As of the date of this Agreement, such Purchaser does not Beneficially Own any Voting Stock or securities convertible into or exchangeable for shares of Voting Stock (excluding any Voting Stock of which such Purchaser may be deemed
to have Beneficial Ownership as a result of being party to any Transaction Document or as a result of Beneficial Ownership of Company securities by a director of the Company). 
 Section 4.11 Availability of Funds. Each Purchaser will have on the Closing Date available capital sufficient to purchase the Notes on the Closing
Date. Except as provided in the Transaction Documents, there are no conditions precedent or other contingencies related to such Purchaser’s funding of the purchase of the Notes. 
 Section 4.12 No Other Representations. Except for the representations and warranties contained in ARTICLE III, each Purchaser acknowledges that
neither Company nor any other Person on behalf of the Company makes any other express or implied representation or warranty with respect to the Company or regarding any other information provided to any Purchaser. 
 ARTICLE V 
 ADDITIONAL AGREEMENTS 

Section 5.1 Use of Proceeds. The Company shall use the net proceeds of the issuance of Notes for the purpose of financing the Offer and the
Merger. The Company shall use any proceeds remaining after such use for general corporate and working capital purposes. 
 Section 5.2
Public Information; Registration Rights. Following the expiration of the Lock-up Period, the Company shall use commercially reasonable efforts to make publicly available such information as is required by Rule 144(c) under the Securities Act,
for so long as is necessary to permit the resale by the Purchasers pursuant to Rule 144 of the Conversion Shares and Warrant Shares. If such resale of such Conversion Shares and Warrant Shares pursuant to Rule 144 by the Purchasers is not possible
due to the Company’s failure to comply with the preceding sentence, upon the written request of the Purchasers, (a) the Company shall use its commercially reasonable efforts to (i) file a registration statement relating to the resale
of the Conversion Shares and Warrant Shares (the “Registration Statement”) within 120 days after receipt of such request and (ii) have such Registration Statement declared effective as promptly as practicable thereafter but in
any event no later than 180 days after such request and (b) the Company and the Purchasers shall enter into a customary registration rights agreement (a “Registration Rights Agreement”) governing the preparation and filing of
such Registration Statement, sales of Conversion Shares and Warrant Shares thereunder and including customary blackout periods and customary indemnification provisions. Additionally, the Company and FP agree (a) that the Company shall
(i) file a registration statement relating to the resale of the Conversion Shares and Warrant Shares held by FP (the “Affiliate Registration Statement”) within 120 days after Closing Date, and (ii) use its commercially
reasonable efforts to have such Affiliate Registration Statement declared effective as promptly as practicable thereafter but in any event no later than the expiration of the Lock-up Period and (b) prior to the Closing Date, to enter into a
registration rights agreement (also a “Registration Rights Agreement”) on terms substantially similar to Sections 

  

 11 

 
1 and 3 of the Company’s Investor Rights Agreement dated June 22, 2006 (including the term in the Investor Rights Agreement that the Company shall
not be required to file the Affiliate Registration Statement, have it declared effective or make it available for use during any period when the Company is not eligible to use Form S-3). For the avoidance of doubt, failure by the Company to comply
with its obligations in this Section 5.2 shall not give rise to the acceleration of the Notes, either automatically or at the option of any holder of the Notes, and, notwithstanding Section 6.1(b), shall not be a condition to closing under
this Agreement. 
 Section 5.3 Lock-Up. Each Purchaser agrees, on a several and not joint basis, that for a period of 180 days from
the Closing Date, (the “Lock-up Period”), such Purchaser shall not, without the prior written consent of the Company, directly or indirectly, (i) offer for sale, sell, pledge or otherwise dispose of
(“Transfer”) any shares of Common Stock or securities convertible into or exchangeable for shares of Common Stock or sell or grant options, rights or warrants with respect to any shares of Common Stock or securities convertible into
or exchangeable for shares of Common Stock (collectively, the “Restricted Securities”) or (ii) enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any of the economic benefits or
risks of ownership of such Restricted Securities. Notwithstanding the foregoing, this Section 5.3 shall not restrict any Purchaser or any Permitted Transferee of such Purchaser (x) from Transferring any Restricted Securities pursuant to a
merger of the Company with any other Person, a tender offer or exchange offer for any and all shares of Common Stock or other similar transaction, provided that such merger, offer or transaction has been approved by the Board of Directors of the
Company or (y) Transferring any Restricted Securities or any of the economic benefit or risks of ownership thereof to any Permitted Transferee of such Person, provided, however, that it shall be a condition to any Transfer pursuant to
this clause (y) that the transferee execute an agreement stating that the transferee is receiving and holding the Restricted Securities (but only the Restricted Securities or any of the economic benefit or risks of ownership thereof) subject to
the provisions of this Agreement, and other than to return the Restricted Securities to the former ownership, there shall be no further Transfer of the Restricted Securities except in accordance with this Agreement. Notwithstanding any provision of
this Agreement, nothing herein shall restrict the transfer of any securities owned by a director of the Company. Notwithstanding the foregoing, (i) nothing in this Agreement shall restrict the Purchasers from purchasing or otherwise acquiring
shares of Common Stock, subject to compliance with applicable law, after the date hereof (any shares so acquired after the date hereof other than Conversion Shares or Warrant Shares, “Additional Shares”) and (ii) during the
Lock-up Period, each Purchaser shall be permitted to Transfer shares of Common Stock or the economic benefits or risks of ownership of such shares, so long as the number of shares of Common Stock so Transferred (directly or on an share-equivalent
basis by the transfer of the economic benefits or risks of ownership) is not greater than the excess of the aggregate number of Additional Shares purchased by such Purchaser over the number of shares of Common Stock previously Transferred pursuant
to this sentence. 
 Section 5.4 Removal of Legend. The legend described in Section 4.5 shall be removed and the Company shall
issue, or shall cause its transfer agent to issue, a certificate without such legend to the holder of Acquired Securities upon which it is stamped (or, in the case of Conversion Shares or Warrant Shares, credit such aggregate number of shares of
Common Stock to which the holder shall be entitled to the holder’s or its designee’s balance account with DTC through its Deposits and Withdrawal at Custodian system), if (i) such Acquired Securities are sold pursuant to an effective
registration statement or (ii) in connection with a sale, assignment or other transfer, such holder provides the Company with an opinion of a law firm reasonably acceptable to the Company, in a generally acceptable form, to the effect that such
sale, assignment or transfer of such Acquired Securities may be made without registration under the applicable requirements of the Securities Act. 
 Section 5.5 Adjustments. The Company shall not take any action between the date hereof and the Closing which would, if taken after the issuance of the Notes, result in an adjustment to the Conversion Price (as defined in the Notes)
pursuant to Section 6 of the Notes or the Exercise Price (as defined in the Warrants) or number of Warrant Shares pursuant to Section 2 of the Warrants, unless the parties hereto shall have amended this Agreement (including the form of
Notes and Warrants) as mutually agreed to provide for an appropriate adjustment to the initial Conversion Price of the Notes and the initial Exercise Price of the Warrants, nor shall the Company take any action between the date hereof and the
Closing which would, if taken after the issuance of the 

  

 12 

 
Notes and the Warrants, result in an issuance of rights, options or warrants or the payment of dividends or distribution of cash or other assets pursuant
to Section 6 of the Notes or Section 2 of the Warrants.
 ARTICLE VI 
 CLOSING CONDITIONS 
 Section 6.1 Conditions of each Purchaser. The obligations
of each Purchaser to consummate the transactions contemplated by the Transaction Documents shall be subject to the satisfaction, or waiver by each Purchaser, of the following conditions on or before the Closing Date: 
 (a) (a)(i) the representations and warranties of the Company set forth in ARTICLE III of this Agreement (other than Section 3.6(a)), disregarding
any materiality or Company Material Adverse Effect qualifications contained in any such representation or warranty, shall be true at and as of the Closing Date, as if made at and as of such date (except to the extent a different date is specified
therein, in which case at and as of such specified date), with only such exceptions as have not had or would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect; and (ii) the representations
and warranties of the Company set forth in Section 3.6(a)) shall be true in all but de minimis respects at and as of the Closing Date; 
 (b) The Company shall have performed and complied in all material respects with all of its covenants and agreements contained in the Transaction Documents to be performed by it on or prior to the Closing Date. 
 (c) No provision of any applicable Legal Requirement and no Order shall prohibit the execution, delivery or performance of this Agreement or any other
Transaction Document or the Registration Rights Agreements by any party hereto or thereto. 
 (d) Each condition to the closing of the Offer
set forth in Annex I of the Merger Agreement shall have been satisfied in all material respects and not waived (other than any waiver made with the prior written consent of all of the Purchasers) and the Merger Agreement shall not have been amended
in any material respect. For purposes of this Section 6.1(d), to the extent Section 7.01 of the Merger Agreement prohibits an action by Target without the prior written consent of the Company, the Company’s consent to any such action
shall not be deemed to be an amendment to or waiver of the Merger Agreement or any condition to the Offer. 
 (e) The Offer Acceptance shall
have occurred. 
 (f) The Company shall have executed and delivered to such Purchaser (A) each of the Transaction Documents,
(B) the Notes (in such principal amounts as are permitted under the terms of the Notes) being purchased by such Purchaser at the Closing pursuant to this Agreement and (C) the Warrants (for such number of Warrant shares as are permitted
under the terms of the Warrants) being issued to such Purchaser at the Closing pursuant to this Agreement. 
 (g) The Company shall have
delivered to such Purchaser a letter from the Company’s transfer agent certifying the number of shares of Common Stock outstanding as of a date within five days of the Closing Date. 
 (h) The Common Stock (i) shall be designated for quotation or listed on the Nasdaq Global Select Market and (ii) shall not have been suspended,
as of the Closing Date, by the SEC or the Nasdaq Global Select Market from trading on the Principal Market. 
 Section 6.2 Conditions of
the Company. The obligation of the Company to consummate the transactions contemplated by this Agreement and by the other Transaction Documents shall be subject to the satisfaction, or waiver by the Company, of the following conditions on or
before the Closing Date: 
 (a) The representations and warranties of the Purchasers set forth in ARTICLE IV of this Agreement, disregarding
any materiality qualifications contained in any such representation or warranty, shall be true at and 

  

 13 

 
as of the Closing Date, as if made at and as of such date (except to the extent a different date is specified therein, in which case at and as of such
specified date), with only such exceptions as have not had or would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on the Purchasers’ ability to consummate the transactions contemplated by the
Transaction Documents. 
 (b) Each of the Purchasers shall have performed and complied in all material respects with all of its covenants and
agreements contained in this Agreement and in any of the Transaction Documents to be performed by it on or prior to the Closing Date. 
 (c)
No provision of any applicable Legal Requirement and no Order shall prohibit the execution, delivery or performance of this Agreement or any other Transaction Document by any party hereto or thereto. 
 (d) The Offer Acceptance shall have occurred. 
 (e) Each Purchaser shall have executed and delivered to the Company (A) each of the Transaction Documents and (B) the purchase price of the Notes at the Closing pursuant to this Agreement. 
 ARTICLE VII 
 TERMINATION OF AGREEMENT AND
REMEDIES 
 Section 7.1 Termination. This Agreement shall be terminated prior to the Closing only as follows: 
 (a) at any time on or prior to the Closing Date, by mutual written consent of each of the Purchasers and the Company; 
 (b) at the election of all of the Purchasers or the Company after the End Date (as defined in the Merger Agreement); provided, however,
that the right to terminate this Agreement under this Section 7.1(b) shall not be available to any party whose breach of any representation, warranty, covenant or agreement under this Agreement has been the cause of, or resulted in, the failure
of the Closing to occur on or before such date; 
 (c) upon any bona fide termination of the Merger Agreement not undertaken for the purpose
of avoiding obligations under this Agreement; 
 (d) at the election of all of the Purchasers if, without the prior written consent of the
Purchasers, the Merger Agreement shall have been amended in any material respect or any condition to the Offer shall have been waived, provided, however, that to the extent Section 7.01 of the Merger Agreement prohibits an action by
Target without the prior written consent of the Company, the Company’s consent to any such action shall not be deemed to be an amendment to, or waiver of, the Merger Agreement or any condition to the Offer. 
 (e) at the election of all of the Purchasers or the Company in the event that any Governmental Authority shall have issued an Order, or taken any other
action, restraining or otherwise prohibiting the consummation of the transactions contemplated by any Transaction Document or any Registration Rights Agreement, and such Order or other action shall have become final and non-appealable. 

In the event of termination pursuant to this Section 7.1, the party or parties so terminating the Agreement shall provide prompt written notice thereof to each
of the other parties. 
 Section 7.2 Effect of Termination. If this Agreement is terminated pursuant to Section 7.1, all
obligations of the parties hereunder shall terminate, except for the obligations set forth in Section 3.11 or Section 4.8 (Brokers), this Section 7.2 and ARTICLE VIII, which shall survive the termination of this Agreement, and except
that no such termination shall relieve any party from liability for any prior willful and material breach of this Agreement or for fraud. 
  

 14 

 Section 7.3 Remedies. The remedies provided herein shall be cumulative and in addition to all
other remedies available under this Agreement, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of any party to pursue damages for any failure to comply with
the terms of this Agreement. Each party acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the other parties and that monetary damages would not be an adequate remedy for any such breach. Each party
therefore agrees that, in the event of any such breach or threatened breach, the other parties shall be entitled, in addition to all other available remedies, to seek an injunction restraining any breach or to an order for specific performance,
without the necessity of showing economic loss and without any bond or other security being required. 
 ARTICLE VIII  
 MISCELLANEOUS 
 Section 8.1 Governing Law;
Disputes. This Agreement shall be construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Agreement shall be governed by, the internal laws of the State of
Delaware, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Delaware or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of
Delaware. The Company and the Purchasers hereby irrevocably submit to the exclusive jurisdiction of the state and federal courts sitting in state of Delaware, for the adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably waive, and agree not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action
or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Without
limiting the foregoing, each party agrees that service of process on such party as provided in Section 8.11 shall be deemed effective service of process on such party. 
 Section 8.2 WAIVER OF JURY TRIAL. EACH OF THE PURCHASERS AND THE COMPANY, HEREBY IRREVOCABLY WAIVE ANY RIGHT TO, AND AGREE NOT TO REQUEST, A JURY
TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY. 
 Section 8.3 Entire Agreement; Amendment. This Agreement (together with the exhibits and schedules hereto, which are incorporated herein by reference and made a part hereof), together with the Notes, constitutes the entire agreement
of the parties with respect to the subject matter hereof and supersedes any prior understandings, agreements or representations by or between the parties hereto, written or oral, with respect to such subject matter. This Agreement may be amended,
modified or supplemented only by a written instrument duly executed by each of the parties hereto, and any such amendment, modification or supplement shall be binding on all parties hereto. 
 Section 8.4 Waiver. No waiver by any party of any term or condition of this Agreement, in one or more instances, shall be valid unless in writing,
and no such waiver shall be deemed to be construed as a waiver of any subsequent breach or default of the same or similar nature. 
 Section
8.5 Successors and Assigns. Except as otherwise expressly provided herein, this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, personal representatives, successors and permitted
assigns. Notwithstanding the foregoing, no assignment of any rights or obligations hereunder shall be made by any party hereto without the written consent of the other parties hereto; provided, that any Purchaser may assign its right to
purchase Notes hereunder to an Affiliate of such Purchaser; provided, further, that no such assignment shall relieve such Purchaser of its obligations hereunder. 
  

 15 

 Section 8.6 Invalid Provisions. In the event that any provision of this Agreement is invalid or
unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision
which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of this Agreement. 
 Section 8.7 Headings. The headings used in this Agreement have been inserted for convenience of reference only and do not define or limit the provisions hereof. 
 Section 8.8 Survival. All representations, warranties, covenants and agreements made by the Company and each Purchaser herein shall survive the
execution of this Agreement and the Closing. 
 Section 8.9 Further Assurances. Each party hereto shall cooperate and shall take such
further action and shall execute and deliver such further documents as may be reasonably requested by any other party in order to carry out the provisions and purposes of this Agreement. 
 Section 8.10 Counterparts. This Agreement may be executed in any number of counterparts, each of which will be deemed an original, but all of
which together will constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by facsimile or portable document format shall be effective as delivery of a manually executed counterpart to this
Agreement. 
 Section 8.11 Notices. All notices, requests and other communications hereunder must be in writing and will be deemed to
have been duly given only if delivered personally against written receipt or by facsimile transmission or mailed by prepaid first class mail, return receipt requested, or mailed by overnight courier prepaid to the parties at the following addresses
or facsimile numbers: 
 If to the Company, to: 
 Blue Coat Systems, Inc. 
 420 North Mary Avenue 
 Sunnyvale, CA 94085 
 Attention: Betsy E.
Bahya 
 Facsimile: (408) 220-2175 
 with a copy to: 
 Davis Polk & Wardwell 
 1600 El Camino Real 
 Menlo Park, CA 94025 
 Facsimile No.: (650) 752-2111 
 Attention: William M. Kelly 
 Sarah K. Solum 
 If to Manchester, to: 
 Manchester Securities Corp. 
 712 Fifth Avenue, 36th Floor 
 New York, NY 10019 
 Facsimile: (212) 478-2871 
 Attention: Jesse A. Cohn 
  

 16 

 with a copy to: 
 Paul, Weiss, Rifkind, Wharton & Garrison LLP 
 1285 Avenue of the Americas 
 New York, NY 10019-6064 
 Facsimile:
(212) 757-3900 
 Attention: Robert B. Schumer 
 Steven J. Williams 
 If to FP, to: 
 Francisco Partners II, L.P. 
 One Letterman
Drive 
 Building C, Suite 410 
 San Francisco, CA 94129 
 Facsimile: (415) 418-2999 
 Attention: Mr. Keith Geeslin 
 with a
copy to: 
 O’Melveny & Myers LLP 
 275 Battery Street, Suite 2600 
 San Francisco, California 94111 
 Facsimile: (415) 894-8701 
 Attention:
Michael J. Kennedy 
 C. Brophy Christensen 
 All such notices, requests and other communications will (w) if delivered personally to the address as provided in this Section 8.11, be deemed given upon delivery, (x) if delivered by facsimile
transmission to the facsimile number as provided in this Section 8.11, be deemed given upon facsimile confirmation, (y) if delivered by mail in the manner described above to the address as provided in this Section 8.11, upon the
earlier of the third business day following mailing or upon receipt and (z) if delivered by overnight courier to the address as provided in this Section 8.11, be deemed given on the earlier of the first business day following the date sent
by such overnight courier or upon receipt (in each case regardless of whether such notice, request or other communication is received by any other Person to whom a copy of such notice is to be delivered pursuant to this Section 8.11). Any party
from time to time may change its address, facsimile number or other information for the purpose of notices to that party by giving written notice specifying such change to the other parties hereto. 
 Section 8.12 Expenses. Each of the parties shall bear its own costs and expenses incurred in connection with the Transaction Documents and the
transactions contemplated thereby. 
 Section 8.13 Publicity; Confidentiality. Except as may be required by applicable Legal
Requirements, none of the parties hereto shall issue a publicity release or public announcement or otherwise make any disclosure concerning this Agreement, the transactions contemplated hereby, or any of the other parties hereto, without prior
written approval by the other parties hereto; provided, however, that nothing in this Agreement shall restrict any party from disclosing information to such party’s officers, directors, equity holders, advisors, employees,
members, partners, controlling Persons, auditors or counsel. If any disclosure is required by any Legal Requirement to be made by any party hereto, prior to making such announcement such party will, to the extent practicable, deliver a draft of such
announcement to the other parties and shall give the other parties reasonable opportunity to comment thereon. 
 Section 8.14
Indemnification. In consideration of each Purchaser’s execution and delivery of the Transaction Documents and acquiring the Securities thereunder and in addition to all of the Company’s other obligations under the Transaction
Documents, from and after the Closing, the Company shall indemnify, defend and hold 

  

 17 

 
harmless each Purchaser and its Affiliates (collectively, the “Indemnitees”) from and against any and all actions, causes of action, suits,
claims, losses, costs, penalties, fees, liabilities and damages, and expenses in connection therewith (irrespective of whether any such Indemnitee is a party to the action for which indemnification hereunder is sought), and including reasonable
attorneys’ fees and disbursements and costs to enforce this provision (the “Indemnified Liabilities”), actually incurred by any Indemnitee as a result of, or arising out of, or relating to any breach of any covenant, agreement
or obligation of the Company contained in the Transaction Documents and the Registration Rights Agreements. To the extent that the foregoing undertaking by the Company may be unenforceable for any reason, the Company shall make the maximum
contribution to the payment and satisfaction of each of the Indemnified Liabilities which is permissible under applicable law. 
 [Remainder
of page intentionally left blank.] 
  

 18 

 IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the date first
above written. 
  

			
	BLUE COAT SYSTEMS, INC.
		
	By:	 	/s/ Brian M. NeSmith
	Name:	 	 Brian M. NeSmith
	Title:	 	 President and Chief Executive Officer

  

			
	MANCHESTER SECURITIES CORP.
		
	By:	 	/s/ Elliot Greenberg
	Name:	 	 Elliot Greenberg
	Title:	 	 Vice President

  

			
	FRANCISCO PARTNERS II, L.P.
		
	By:	  	 Francisco Partners GP II, L.P., General Partner
	By:	  	 Francisco Partners GP II Management LLC,  General Partner

  

			
	By:	 	/s/ Keith B. Geeslin
	Name:	 	 Keith B. Geeslin
	Title:	 	 Managing Member

  
  
  
 [Signature Page to Note Purchase Agreement] 
  

 19 

 Exhibit A 
 [Form of Note] 
  

 20 

 Exhibit B 
 [Form of Warrant] 
  

 21 

 Schedule 2.1 
 Principal Amount and Purchase Price of Notes 
  

							
	 Purchaser
	  	Principal
Amount of
Note	  	Purchase
Price of Note
	 Manchester Securities Corp.
	  	$	40,000,000	  	$	40,000,000
	 Francisco Partners II, L.P.
	  	$	40,000,000	  	$	40,000,000
		  	 	 	  	 	 
	 TOTAL
	  	$	80,000,000	  	$	80,000,000
		  	 	 	  	 	 

  

 22 

 Schedule 2.2 
 Shares Subject to Warrants 
  

			
	 Purchaser
	  	Shares Subject
to Warrants
	 Manchester Securities Corp.
	  	192,678
	 Francisco Partners II, L.P.
	  	192,678
		  	 
	 TOTAL
	  	385,356
		  	 

  

 23

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