Document:

EX-10.4

 Exhibit 10.4 

VARONIS SYSTEMS, INC. 

BRIDGE BANK, NATIONAL ASSOCIATION 

LOAN AND SECURITY AGREEMENT 

 This LOAN AND SECURITY
AGREEMENT is entered into as of November 14, 2011, by and between BRIDGE BANK, NATIONAL ASSOCIATION (“Bank”) and VARONIS
SYSTEMS, INC. (“Borrower”). 
 RECITALS 

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

 The parties agree as follows: 

1. DEFINITIONS AND CONSTRUCTION. 

1.1 Definitions. As used in this Agreement, the following terms shall have the following definitions: 

“Accounts” means all presently existing and hereafter arising accounts, contract rights, payment intangibles, and all other forms of
obligations owing to Borrower arising out of the sale or lease of goods (including, without limitation, the licensing of software and other technology) or the rendering of services by Borrower, whether or not earned by performance, and any and all
credit insurance, guaranties, and other security therefor, as well as all merchandise returned to or reclaimed by Borrower and Borrower’s Books relating to any of the foregoing. 

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

“Affiliate” means, with respect to any Person, any Person that owns 5% of more or controls directly or indirectly such Person, any
Person that controls or is controlled by or is under common control with such Person, and each of such Person’s senior executive officers, directors, and partners. 

“Adjusted Quick Ratio” means a ratio of Quick Assets to Current Liabilities. 

“Ancillary Services” means all Credit Extensions other than Advances. 

“Asset Coverage Ratio” means a ratio of Quick Assets to all outstanding Credit Extensions made under this Agreement. 

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

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

“Borrowing Base” means an amount equal to the sum of (i) eighty percent (80%) of Eligible Domestic Accounts and
(ii) fifty percent (50%) of Eligible Foreign Accounts, as determined by Bank with reference to the most recent Borrowing Base Certificate delivered by Borrower. 

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

  
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 “Closing Date” means the date of this Agreement. 

“Code” means the California Uniform Commercial Code. 

“Collateral” means the property described on Exhibit A attached hereto. 

“Contingent Obligation” means, as applied to any Person, any direct or indirect liability, contingent or otherwise, of that Person
with respect to (i) any indebtedness, lease, dividend, letter of credit or other obligation of another; (ii) any obligations with respect to undrawn letters of credit, corporate credit cards, or merchant services issued or provided for the
account of that Person; and (iii) all obligations arising under any agreement or arrangement designed to protect such Person against fluctuation in interest rates, currency exchange rates or commodity prices; provided, however, that the term
“Contingent Obligation” shall not include endorsements for collection or deposit in the ordinary course of business. The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determined amount of the
primary obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by Bank in good faith; provided, however, that such amount
shall not in any event exceed the maximum amount of the obligations under the guarantee or other support arrangement. 

“Copyrights” means any and all copyright rights, copyright applications, copyright registrations and like protections in each work
or authorship and derivative work thereof. 
 “Credit Extension” means each Advance, letter of credit, use of cash management
services, foreign exchange services, hedging activities or any other extension of credit by Bank for the benefit of Borrower hereunder. 

“Current Liabilities” means, as of any applicable date, all amounts that should, in accordance with GAAP, be included as current
liabilities on the consolidated balance sheet of Borrower and its Subsidiaries, as at such date, plus, to the extent not already included therein, all outstanding Credit Extensions made under this Agreement, excluding deferred revenue and accrued
vacation liability. 
 “Daily Balance” means the amount of the Obligations owed at the end of a given day. 

“Eligible Accounts” means the aggregate of Eligible Domestic Accounts and Eligible Foreign Accounts. 

“Eligible Domestic Accounts” means those Accounts that arise in the ordinary course of Borrower’s business that comply with all
of Borrower’s representations and warranties to Bank set forth in Section 5.4; provided, that standards of eligibility may be fixed and revised from time to time by Bank in Bank’s reasonable judgment and upon notification thereof to
Borrower in accordance with the provisions hereof. Unless otherwise agreed to by Bank, Eligible Domestic Accounts shall not include the following: 

(a) Accounts that the account debtor has failed to pay within ninety (90) days of invoice date; 

(b) Accounts with respect to an account debtor, fifty percent (50%) of whose Accounts the account debtor has failed to pay within
ninety (90) days of invoice date; 
 (c) Accounts with respect to which the account debtor is an officer, employee, or agent of
Borrower; 
 (d) Accounts with respect to which goods are placed on consignment, guaranteed sale, sale or return, sale on approval,
bill and hold, or other terms by reason of which the payment by the account debtor may be conditional; notwithstanding the foregoing, up to twenty five percent (25%) of Eligible Accounts may include Accounts with respect which the account
debtor is EMC Corporation that may be returned to Borrower within forty-five (45) days of invoice date for so long as Borrower’s consolidated unrestricted cash held in accounts with Bank is at least $1,000,000; 

  
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 (e) Accounts with respect to which the account debtor is an Affiliate of Borrower; 

(f) Accounts with respect to which the account debtor does not have its principal place of business in the United States or Canada;

 (g) Accounts with respect to which the account debtor is the United States or any department, agency, or instrumentality of the
United States; 
 (h) Accounts with respect to which Borrower is liable to the account debtor for goods sold or services rendered by
the account debtor to Borrower or for deposits or other property of the account debtor held by Borrower, but only to the extent of any amounts owing to the account debtor against amounts owed to Borrower; 

(i) Accounts with respect to an account debtor, including Subsidiaries and Affiliates, whose total obligations to Borrower exceed
thirty percent (30%) of all Accounts, to the extent such obligations exceed the aforementioned percentage (i.e. only with respect to such Accounts value in excess of the thirty percent (30%)), except (i) for Accounts with respect to the
account debtor EMC Corporation, whose total obligations to Borrower may not exceed sixty five percent (65%) to the extent such obligations exceed the aforementioned percentage (i.e. only with respect to such Accounts value in excess of the
sixty five percent (65%)) and (ii) as approved in writing by Bank; 
 (j) Accounts with respect to which the account debtor
disputes liability or makes any claim with respect thereto as to which Bank believes, in its sole discretion, that there may be a basis for dispute (but only to the extent of the amount subject to such dispute or claim), or is subject to any
Insolvency Proceeding, or becomes insolvent, or goes out of business; 
 (k) Progress and retention billings; and 

(l) Accounts the collection of which Bank reasonably determines to be doubtful. 

“Eligible Foreign Accounts” means Accounts with respect to which the account debtor does not have its principal place of business in
the United States or Canada and that (i) are billed and collected in the United States, (ii) would otherwise be an Eligible Domestic Account, (iii) are supported by one or more letters of credit in an amount and of a tenor, and issued
by a financial institution, acceptable to Bank, or (iv) that Bank approves on a case-by-case basis; provided however, the aggregate amount of all Eligible Foreign Accounts shall not exceed 20% of the aggregate amount of all Eligible Accounts at
any time. 
 “Equipment” means all present and future machinery, equipment, tenant improvements, furniture, fixtures, vehicles,
tools, parts and attachments in which Borrower has any interest. 
 “ERISA” means the Employee Retirement Income Security Act of
1974, as amended, and the regulations thereunder. 
 “Event of Default” has the meaning assigned in Article 8. 

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

“Indebtedness” means (a) all indebtedness for borrowed money or the deferred purchase price of property or services, including
without limitation reimbursement and other obligations with respect to surety bonds and letters of credit, (b) all obligations evidenced by notes, bonds, debentures or similar instruments, (c) all capital lease obligations and (d) all
Contingent Obligations. 
 “Insolvency Proceeding” means any proceeding commenced by or against any person or entity under any
provision of the United States Bankruptcy Code, as amended, or under any other bankruptcy or insolvency law, including assignments for the benefit of creditors, formal or informal moratoria, compositions, extension generally with its creditors, or
proceedings seeking reorganization, arrangement, or other relief. 

  
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 “Intellectual Property” means all of Borrower’s right, title, and interest in and
to the following: Copyrights, Trademarks and Patents; all trade secrets, all design rights, claims for damages by way of past, present and future infringement of any of the rights included above, all licenses or other rights to use any of the
Copyrights, Patents or Trademarks, and all license fees and royalties arising from such use to the extent permitted by such license or rights; all amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents; and all proceeds
and products of the foregoing, including without limitation all payments under insurance or any indemnity or warranty payable in respect of any of the foregoing. 

“Inventory” means all inventory in which Borrower has or acquires any interest, including work in process and finished products
intended for sale or lease or to be furnished under a contract of service, of every kind and description now or at any time hereafter owned by or in the custody or possession, actual or constructive, of Borrower, including such inventory as is
temporarily out of its custody or possession or in transit and including any returns upon any accounts or other proceeds, including insurance proceeds, resulting from the sale or disposition of any of the foregoing and any documents of title
representing any of the above, and Borrower’s Books relating to any of the foregoing. 
 “Investment” means any beneficial
ownership of (including stock, partnership interest or other securities) any Person, or any loan, advance or capital contribution to any Person. 

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

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

“Loan Documents” means, collectively, this Agreement, any note or notes executed by Borrower, and any other agreement entered into
in connection with this Agreement, all as amended or extended from time to time. 
 “Material Adverse Effect” means a material
adverse effect on (i) the business operations, condition (financial or otherwise) or prospects of Borrower and its Subsidiaries taken as a whole or (ii) the ability of Borrower to repay the Obligations or otherwise perform its obligations under
the Loan Documents or (iii) the value or priority of Bank’s security interests in the Collateral. 
 “Negotiable
Collateral” means all letters of credit of which Borrower is a beneficiary, notes, drafts, instruments, securities, documents of title, and chattel paper, and Borrower’s Books relating to any of the foregoing. 

“Obligations” means all debt, principal, interest, Bank Expenses and other amounts owed to Bank by Borrower pursuant to this
Agreement or any other agreement, whether absolute or contingent, due or to become due, now existing or hereafter arising, including any interest that accrues after the commencement of an Insolvency Proceeding and including any debt, liability, or
obligation owing from Borrower to others that Bank may have obtained by assignment or otherwise. 
 “Patents” means all patents,
patent applications and like protections including without limitation improvements, divisions, continuations, renewals, reissues, extensions and continuations-in-part of the same. 

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

“Permitted Indebtedness” means: 

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

(b) Indebtedness existing on the Closing Date and disclosed in the Schedule; 

(c) Indebtedness secured by a lien described in clause (c) of the defined term “Permitted Liens,” provided (i) such
Indebtedness does not exceed the lesser of the cost or fair market value of the equipment financed with such Indebtedness and (ii) such Indebtedness does not exceed $100,000 in the aggregate at any given time; and 

(d) Indebtedness (i) consisting of intercompany loans and advances made by the Borrower to any Subsidiary in the ordinary course
of business, (ii) between Subsidiaries in the ordinary course of business, and (iii) of any Subsidiary to Borrower permitted under clause (f) of the definition of “Permitted Investments”; 

  
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 (e) Indebtedness consisting of the endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business; 
 (f) Indebtedness with respect to surety bonds and similar
obligations in the ordinary course of business; 
 (g) Indebtedness incurred for the acquisition of supplies or inventory or for
payment of services on normal trade credit in the ordinary course of business; 
 (h) Subordinated Debt. 

(i) Indebtedness not otherwise permitted in subsections (a) through (h) above, in an aggregate amount outstanding not to
exceed One Hundred Thousand Dollars $100,000 in any fiscal year; 
 (j) Extensions, refinancings, modifications, amendments and
restatements of any item of Permitted Indebtedness described in clauses (a) though (i) above, provided that the principal amount thereof is not increased or the terms thereof are not modified to impose more burdensome terms upon Borrower
or its Subsidiary, as the case may be. 
 “Permitted Investment” means: 

(a) Investments existing on the Closing Date disclosed in the Schedule; and 

(b) (i) marketable direct obligations issued or unconditionally guaranteed by the United States of America or any agency or any
State thereof maturing within one (1) year from the date of acquisition thereof, (ii) commercial paper maturing no more than one (1) year from the date of creation thereof and currently having rating of at least A-2 or P-2 from either
Standard & Poor’s Corporation or Moody’s Investors Service, (iii) certificates of deposit maturing no more than one (1) year from the date of investment therein issued by Bank and (iv) Bank’s money market accounts.

 (c) temporary advances to employees to cover incidental expenses to be incurred in the ordinary course of business not to exceed
$75,000, or temporary advances paid on the account of sales commissions to new employees not to exceed $50,000 per employee; 
 (d)
Investments (including debt obligations) received in connection with the bankruptcy or reorganization of customers or suppliers and in settlement of delinquent obligations of, and other disputes with, customers or suppliers arising in the ordinary
course of business; 
 (e) Investments in joint ventures, strategic alliances, licensing and similar arrangements customary in
Borrower’s industry in which the cash Investments by Borrower do not exceed $250,000 in the aggregate in any fiscal year and which (i) do not require Borrower to assume or otherwise become liable for the obligations of any third party not
directly related to or arising out of such arrangement or, (ii) do not require Borrower to transfer ownership of non-cash assets to such joint venture or other entity; 

(f) Investments consisting of deposit accounts in which Bank has a perfected security interest, subject to Section 6.7; 

(g) Investments (i) of Subsidiaries in or to Borrower or other subsidiaries in the ordinary course of business, (ii) of
Borrower in or to Subsidiaries in an amount not to exceed $100,000 in any fiscal year, (iii) to the extent it constitutes an Investment, payments made pursuant to cost plus or distribution arrangements between Borrower and any Subsidiaries in
the ordinary course of business or as otherwise permitted by Bank with prior written consent to Borrower, which consent shall not be unreasonably withheld; 

(h) Investments consisting of loans to employees, consultants or directors relating to the purchase of equity securities of Borrower
pursuant to employee stock purchase plans or agreements approved by Borrower Board of Directors so long as the aggregate outstanding amounts of such loans does not exceed $50,000 at any time; 

  
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 (i) Investments permitted by Borrower investment policy as approved by Borrower’s
Board of Directors, provided such investment policy and any amendment (and any amendment thereto) has been provided and is acceptable to Bank; 

(j) Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business; 
 (k) Investments consisting of notes receivable or, prepaid royalties and other credit obligations to
customers and suppliers who are not Affiliates, in the ordinary course of business, provided that this paragraph shall not apply to Investments of Borrower in any Subsidiary; and 

(l) Other Investments not otherwise permitted by subsection (a) through (k) above, not exceeding One Hundred Thousand Dollars
($100,000) in cash in the aggregate outstanding at any time. 
 “Permitted Liens” means the following: 

(a) Any Liens existing on the Closing Date and disclosed in the Schedule or arising under this Agreement or the other Loan Documents;

 (b) Liens for taxes, fees, assessments or other governmental charges or levies, either not delinquent or being contested in good
faith by appropriate proceedings, provided the same have no priority over any of Bank’s security interests; 
 (c) Liens
(i) upon or in any equipment which was not financed by Bank acquired or held by Borrower or any of its Subsidiaries to secure the purchase price of such equipment or indebtedness incurred solely for the purpose of financing the acquisition of
such equipment, or (ii) existing on such equipment at the time of its acquisition, provided that the Lien is confined solely to the property so acquired and improvements thereon, and the proceeds of such equipment; 

(d) Liens securing claims or demands of materialmen, artisans, mechanics, carriers, warehousemen, landlords and other like Persons
arising in the ordinary course of Borrower’s business and imposed without action of such parties; 
 (e) Liens arising from
judgments, decrees or attachments in circumstances which do not constitute an Event of Default hereunder; 
 (f) Liens arising in the
ordinary course of Borrower’s business to secure payment of worker’s compensation, unemployment insurance, social security and other similar laws, or to secure the performance of bids, tenders or contracts (other than for the repayment of
borrowed money) or to secure indemnity, performance or other similar bonds for the performance of bids, tenders or contracts (other than for the repayment of borrowed money) or to secure statutory obligations (other than Liens arising under ERISA or
environmental Liens) or surety or appeal bonds, or to secure indemnity, performance or other similar bonds; 
 (g) Liens on insurance
proceeds in favor of insurance companies granted solely as security for financed premiums; 
 (h) Leases or subleases and
non-exclusive licenses or non-exclusive sublicenses granted in the ordinary course business; 
 (i) Liens in favor of customs and
revenue authorities arising as a matter of law to secure payments of custom duties in connection with the importation of goods; 

(j) Liens in favor of other financial institutions arising in connection with customary fees incurred by Borrower’s deposit and/or
securities accounts held at such institutions; 
 (k) Other Liens not otherwise permitted by subsection (a) through
(j) above, to secure an obligation of the Borrower in the amount of not more than One Hundred Thousand Dollars ($100,000) in cash in the aggregate outstanding at any time; 

  
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 (l) Liens incurred in connection with the extension, renewal or refinancing of the
indebtedness secured by Liens of the type described in clauses (a) through (k) above, provided that any extension, renewal or replacement Lien shall be limited to the property encumbered by the existing Lien and the principal amount of the
indebtedness being extended, renewed or refinanced does not increase. 
 “Person” means any individual, sole proprietorship,
partnership, limited liability company, joint venture, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or governmental agency. 

“Prime Rate’’ means the greater of 3.25 (%) percent per year, or the variable rate of interest, per annum, most recently
announced by Bank, as its “prime rate”, whether or not such announced rate is the lowest rate available from Bank. 
 “Quick
Assets” means, at any date as of which the amount thereof shall be determined, (a) the unrestricted cash and cash-equivalents and investments with maturities not to exceed 90 days held at Bank or under an account control agreement for the
benefit of Bank plus (b) Eligible Accounts. 
 “Responsible Officer” means each of the Chief Executive Officer, the Chief
Financial Officer and the Vice President of Research and Development of Borrower. 
 “Revolving Facility” means the facility under
which Borrower may request Bank to issue Advances, as specified in Section 2.1 (a) hereof. 
 “Revolving Line” means a
credit extension of up to Five Million Dollars ($5,000,000). 
 “Revolving Maturity Date” means 24 months from the Closing Date.

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

“Subordinated Debt” means any debt incurred by Borrower that is subordinated to the debt owing by Borrower to Bank on terms
acceptable to Bank (and identified as being such by Borrower and Bank). 
 “Subsidiary” means any corporation, company or
partnership in which (i) any general partnership interest or (ii) more than 50% of the stock or other units of ownership which by the terms thereof has the ordinary voting power to elect the Board of Directors, managers or trustees of the
entity, at the time as of which any determination is being made, is owned by Borrower, either directly or through an Affiliate. 

“Trademarks” means any trademark and servicemark rights, whether registered or not, applications to register and registrations of
the same and like protections, and the entire goodwill of the business of Borrower connected with and symbolized by such trademarks. 

1.2 Accounting Terms. All accounting terms not specifically defined herein shall be construed in accordance with GAAP and all
calculations made hereunder shall be made in accordance with GAAP. When used herein, the terms “financial statements” shall include the notes and schedules thereto. 

2. LOAN AND TERMS OF PAYMENT. 

2.1 Credit Extensions. 

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

  
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 (a) Revolving Advances. 

(i) Subject to and upon the terms and conditions of this Agreement, Borrower may request Advances in an aggregate outstanding amount
not to exceed the lesser of (i) the Revolving Line or (ii) the Borrowing Base. Subject to the terms and conditions of this Agreement, amounts borrowed pursuant to this Section 2.1(a) may be repaid and reborrowed at any time prior
to the Revolving Maturity Date, at which time all Advances under this Section 2.1(a) shall be immediately due and payable. Borrower may prepay any Advances without penalty or premium. 

(ii) Whenever Borrower desires an Advance, Borrower will notify Bank by facsimile transmission or telephone no later than 3:00 p.m.
Pacific time, on the Business Day that the Advance is to be made. Each such notification shall be promptly confirmed by a Revolving Advance Request Form in substantially the form of Exhibit B hereto. Bank is authorized to make Advances under
this Agreement, based upon instructions received from a Responsible Officer or a designee of a Responsible Officer, or without instructions if in Bank’s discretion such Advances are necessary to meet Obligations which have become due and remain
unpaid. Bank shall be entitled to rely on any telephonic notice given by a person who Bank reasonably believes to be a Responsible Officer or a designee thereof, and Borrower shall indemnify and hold Bank harmless for any damages or loss suffered by
Bank as a result of such reliance. Bank will credit the amount of Advances made under this Section 2.1(a) to Borrower’s deposit account. 

2.2 Overadvances. If the aggregate amount of the outstanding Advances exceeds the lesser of the Revolving Line or the Borrowing
Base at any time, Borrower shall immediately pay to Bank, in cash, the amount of such excess. 
 2.3 Interest Rates, Payments, and
Calculations. 
 (a) Interest Rates. 

(i) Advances. Except as set forth in Section 2.3(b), the Advances shall bear interest, on the outstanding Daily Balance thereof,
at a rate per annum equal to one half of one percent (0.50%) above the Prime Rate. 
 (b) Late Fee; Default Rate. If any payment is
not made within ten (10) days after the date such payment is due, Borrower shall pay Bank a late fee equal to the lesser of (i) five percent (5%) of the amount of such unpaid amount or (ii) the maximum amount permitted to be
charged under applicable law, not in any case to be less than $25.00. All Obligations shall bear interest, from and after the occurrence and during the continuance of an Event of Default, at a rate equal to five (5) percentage points above the
interest rate applicable immediately prior to the occurrence of the Event of Default. 
 (c) Payments. Interest hereunder shall be
due and payable on the tenth calendar day of each month during the term hereof. Bank shall, at its option, charge such interest, all Bank Expenses, and all Periodic Payments against any of Borrower’s deposit accounts or against the Revolving
Line, in which case those amounts shall thereafter accrue interest at the rate then applicable hereunder. Any interest not paid when due shall be compounded by becoming a part of the Obligations, and such interest shall thereafter accrue interest at
the rate then applicable hereunder. All payments shall be free and clear of any taxes, withholdings, duties, impositions or other charges, to the end that Bank will receive the entire amount of any Obligations payable hereunder, regardless of source
of payment. 
 (d) Computation. In the event the Prime Rate is changed from time to time hereafter, the applicable rate of
interest hereunder shall be increased or decreased, effective as of the day the Prime Rate is changed, by an amount equal to such change in the Prime Rate. All interest chargeable under the Loan Documents shall be computed on the basis of a three
hundred sixty (360) day year for the actual number of days elapsed. 
 2.4 Crediting Payments. Prior to the occurrence of
an Event of Default, Bank shall credit a wire transfer of funds, check or other item of payment to such deposit account or Obligation as Borrower specifies. After the occurrence of an Event of Default, the receipt by Bank of any wire transfer of
funds, check, or other item of payment shall be immediately applied to conditionally reduce Obligations, but shall not be considered a payment on account unless such payment is of immediately available federal funds or unless and until such check or
other item of payment is honored when presented for payment. Notwithstanding anything to the contrary contained herein, any wire transfer or payment received by Bank after 12:00 noon Pacific time shall be deemed to have been received by Bank as of
the opening of business on the immediately following Business Day. Whenever any 

  
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 payment to Bank under the Loan Documents would otherwise be due (except by reason of acceleration) on a date that
is not a Business Day, such payment shall instead be due on the next Business Day, and additional fees or interest, as the case may be, shall accrue and be payable for the period of such extension. 

2.5 Fees. Borrower shall pay to Bank the following: 

(a) Facility Fee. On the Closing Date, a Facility Fee equal to $12,500, which shall be nonrefundable; and 

(b) Bank Expenses. On the Closing Date, all Bank Expenses (including reasonable attorneys’ fees and expenses incurred in
connection with the preparation, negotiation and administration of the Loan Documents) through the Closing Date, of up to $7,500, out of which $2,500 has already been paid by Borrower to Bank on August 30, 2011, and after the Closing Date, all
Bank Expenses, including reasonable attorneys’ fees and expenses, as and when they are incurred by Bank. 
 2.6 Term. This
Agreement shall become effective on the Closing Date and, subject to Section 13.7, shall continue in full force and effect for so long as any Obligations (other than inchoate indemnity obligations) remain outstanding or Bank has any obligation
to make Credit Extensions under this Agreement. Notwithstanding the foregoing, (a) Bank shall have the right to terminate its obligation to make Credit Extensions under this Agreement immediately and without notice upon the occurrence and
during the continuance of an Event of Default, and (b) Borrower shall have the right to terminate this Agreement upon ten (10) Business Days notice to Bank and payment of all outstanding Obligations (other than inchoate indemnity
obligations). Notwithstanding termination, Bank’s Lien on the Collateral shall remain in effect for so long as any Obligations (other than inchoate indemnity obligations) are outstanding. 

3. CONDITIONS OF LOANS. 

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

 (b) a certificate of the Secretary of Borrower with respect to incumbency and resolutions authorizing the execution and delivery
of this Agreement; 
 (c) UCC National Form Financing Statement; 

(d) agreement to provide insurance; 

(e) payment of the fees and Bank Expenses then due specified in Section 2.5 hereof; 

(f) current financial statements of Borrower; 

(g) an audit of the Collateral, the results of which shall be satisfactory to Bank; provided such audit must occur within 90 days of
the Closing Date; and 
 (h) such other documents, and completion of such other matters, as Bank may reasonably deem necessary or
appropriate. 
 3.2 Conditions Precedent to all Credit Extensions. The obligation of Bank to make each Credit Extension, including the
initial Credit Extension, is further subject to the following conditions: 
 (a) timely receipt by Bank of the Revolving Advance
Request Form as provided in Section 2.1; and 
 (b) the representations and warranties contained in Section 5 shall be true and
correct in all material respects on and as of the date of such Revolving Advance Request Form and on the effective date of each Credit Extension as though made at and as of each such date, and no Event of Default shall have

  
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occurred and be continuing, or would exist after giving effect to such Credit Extension. The making of each Credit Extension shall be deemed to be a representation and warranty by Borrower on the
date of such Credit Extension as to the accuracy of the facts referred to in this Section 3.2. 
 4. CREATION
OF SECURITY INTEREST. 
 4.1 Grant of Security Interest. Borrower grants and pledges
to Bank a continuing security interest in all presently existing and hereafter acquired or arising Collateral in order to secure prompt repayment of any and all Obligations and in order to secure prompt performance by Borrower of each of its
covenants and duties under the Loan Documents. Except as set forth in the Schedule, such security interest constitutes a valid, first priority security interest in the presently existing Collateral, and will constitute a valid, first priority
security interest in Collateral acquired after the date hereof (subject only to Permitted Liens that may have superior priority to Bank’s Lien under this Agreement). 

4.2 Delivery of Additional Documentation Required. Borrower shall from time to time execute and deliver to Bank, at the request of Bank,
all Negotiable Collateral, all financing statements and other documents that Bank may reasonably request, in form satisfactory to Bank, to perfect and continue the perfection of Bank’s security interests in the Collateral and in order to fully
consummate all of the transactions contemplated under the Loan Documents. Borrower from time to time may deposit with Bank specific time deposit accounts to secure specific Obligations. Borrower authorizes Bank to hold such balances in pledge and to
decline to honor any drafts thereon or any request by Borrower or any other Person to pay or otherwise transfer any part of such balances for so long as the Obligations are outstanding. 

4.3 Right to Inspect. Bank (through any of its officers, employees, or agents) shall have the right, upon reasonable prior notice, from
time to time during Borrower’s usual business hours but no more than once a year (unless an Event of Default has occurred and is continuing), to inspect Borrower’s Books and to make copies thereof and to check, test, and appraise the
Collateral in order to verify Borrower’s financial condition or the amount, condition of, or any other matter relating to, the Collateral, provided that the audit costs incurred under this provision or Section 6.3 shall not in the
aggregate exceed $5,000 unless an Event of Default has occurred and is continuing in which case such costs shall not exceed $7,500. 
 5.
REPRESENTATIONS AND WARRANTIES. 
 Borrower represents and warrants as follows: 

5.1 Due Organization and Qualification. Borrower and each Subsidiary is a corporation duly existing under the laws of its state of
incorporation and qualified and licensed to do business in any state in which the conduct of its business or its ownership of property requires that it be so qualified. 

5.2 Due Authorization; No Conflict. The execution, delivery, and performance of the Loan Documents are within Borrower’s powers,
have been duly authorized, and are not in conflict with nor constitute a breach of any provision contained in Borrower’s Articles of Incorporation or Bylaws, nor will they constitute an event of default under any material agreement to which
Borrower is a party or by which Borrower is bound. Borrower is not in default under any material agreement to which it is a party or by which it is bound, 

5.3 No Prior Encumbrances. Borrower has good and marketable title to its property, free and clear of Liens, except for Permitted Liens.

 5.4 Bona Fide Eligible Accounts. The Eligible Accounts are bona fide existing obligations. The property and services giving rise to
such Eligible Accounts have been delivered or rendered to the account debtor or to the account debtor’s agent for immediate and unconditional acceptance by the account debtor, except for such allowances made under subsection (d) under the
definition of Eligible Domestic Accounts in Section 1.1 for Accounts with respect to which the account debtor is EMC Corporation. Borrower has not received notice of actual or imminent Insolvency Proceeding of any account debtor that is included in
any Borrowing Base Certificate as an Eligible Account. 
 5.5 Merchantable Inventory. All Inventory is in all material respects of
good and marketable quality, free from all material defects, except for Inventory for which adequate reserves have been made. 

  
 10 

 5.6 Intellectual Property. Borrower is the sole owner of the Intellectual Property, except
for non-exclusive licenses granted by Borrower to its customers in the ordinary course of business. Each of the Patents is valid and enforceable, and no part of the Intellectual Property has been judged invalid or unenforceable, in whole or in part,
and no claim has been made in writing that any part of the Intellectual Property violates the rights of any third party. Except as set forth in the Schedule, Borrower’s rights as a licensee of intellectual property do not give rise to more than
five percent (5%) of its gross revenue in any given month, including without limitation revenue derived from the sale, licensing, rendering or disposition of any product or service. Except as set forth in the Schedule, Borrower is not a party
to, or bound by, any agreement that restricts the grant by Borrower of a security interest in Borrower’s rights under such agreement. 

5.7 Name; Location of Chief Executive Office. Except as disclosed in the Schedule, Borrower has not done
business under any name other than that specified on the signature page hereof. The chief executive office of Borrower is located at the address indicated in Section 10 hereof or as otherwise disclosed to Bank in writing pursuant to
Section 7.2 or 7.10. All Borrower’s Inventory and Equipment is located only at the location set forth in Section 10 hereof or as otherwise disclosed to Bank in writing pursuant to Section 7.2 or 7.10. 

5.8 Litigation. Except as set forth in the Schedule, or as otherwise disclosed in writing pursuant to Section 6.3, there are no
actions or proceedings pending by or against Borrower or any Subsidiary before any court or administrative agency in which an adverse decision could reasonably be expected to have a Material Adverse Effect, or a material adverse effect on
Borrower’s interest or Bank’s security interest in the Collateral. 
 5.9 No Material Adverse Change in Financial
Statements. All consolidated and consolidating financial statements related to Borrower and any Subsidiary that Bank has received from Borrower fairly present in all material respects Borrower’s financial condition as of the date thereof
and Borrower’s consolidated and consolidating results of operations for the period then ended. There has not been a material adverse change in the consolidated or the consolidating financial condition of Borrower since the date of the most
recent of such financial statements submitted to Bank. 
 5.10 Solvency, Payment of Debts. Borrower is solvent and able to pay its
debts (including trade debts) as they mature. 
 5.11 Regulatory Compliance. Borrower and each Subsidiary have met the minimum funding
requirements of ERISA with respect to any employee benefit plans subject to ERISA, and no event has occurred resulting from Borrower’s failure to comply with ERISA that could reasonably be expected to result in Borrower’s incurring any
material liability. Borrower is not regulated as an “investment company” or a company “controlled” by an entity regulated as an “investment company” within the meaning of the Investment Company Act of 1940. Borrower is
not engaged principally, or as one of the important activities, in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of Regulations T and U of the Board of Governors of the Federal Reserve
System). Borrower has complied with all the provisions of the Federal Fair Labor Standards Act. Borrower has not violated any statutes, laws, ordinances or rules applicable to it, violation of which could have a Material Adverse Effect. 

5.12 Environmental Condition. Except as disclosed in the Schedule, none of Borrower’s or any Subsidiary’s properties or assets
has ever been used by Borrower or any Subsidiary or, to the best of Borrower’s knowledge, by previous owners or operators, in the disposal of, or to produce, store, handle, treat, release, or transport, any hazardous waste or hazardous
substance other than in accordance with applicable law; to the best of Borrower’s knowledge, none of Borrower’s properties or assets has ever been designated or identified in any manner pursuant to any environmental protection statute as a
hazardous waste or hazardous substance disposal site, or a candidate for closure pursuant to any environmental protection statute; no lien arising under any environmental protection statute has attached to any revenues or to any real or personal
property owned by Borrower or any Subsidiary; and neither Borrower nor any Subsidiary has received a summons, citation, notice, or directive from the Environmental Protection Agency or any other federal, state or other governmental agency concerning
any action or omission by Borrower or any Subsidiary resulting in the releasing, or otherwise disposing of hazardous waste or hazardous substances into the environment. 

5.13 Taxes. Borrower and each Subsidiary have filed or caused to be filed all tax returns required to be filed, and have paid, or have
made adequate provision for the payment of, all taxes reflected therein. 
 5.14 Subsidiaries. Borrower does not own any stock,
partnership interest or other equity securities of any Person, except for Permitted Investments. 

  
 11 

 5.15 Government Consents. Borrower and each Subsidiary have obtained all material
consents, approvals and authorizations of, made all material declarations or filings with, and given all material notices to, all governmental authorities that are necessary for the continued operation of Borrower’s business as currently
conducted. 
 5.16 Accounts. Subject to Section 6.7 hereof, none of Borrower’s nor any Subsidiary’s deposit, investment
or securities accounts is maintained or invested with a Person other than Bank. 
 5.17 Full Disclosure. No representation, warranty
or other statement made by Borrower in any certificate or written statement furnished to Bank contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained in such certificates
or statements not misleading, it being recognized by Bank that the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not to be viewed as facts, and that actual results during the period or periods
covered may differ from the projected or forecasted results. 
 6. AFFIRMATIVE COVENANTS. 

Borrower shall do all of the following: 

6.1 Good Standing. Borrower shall maintain its and each of its Subsidiaries’ corporate existence and good standing in its
jurisdiction of incorporation and maintain qualification in each jurisdiction in which it is required under applicable law. Borrower shall maintain, and shall cause each of its Subsidiaries to maintain, in force all licenses, approvals and
agreements, the loss of which could reasonably be expected to have a Material Adverse Effect. 
 6.2 Government Compliance. Borrower
shall meet, and shall cause each Subsidiary to meet, the minimum funding requirements of ERISA with respect to any employee benefit plans subject to ERISA. Borrower shall comply, and shall cause each Subsidiary to comply, with all statutes, laws,
ordinances and government rules and regulations to which it is subject, noncompliance with which could reasonably be expected to have a Material Adverse Effect. 

6.3 Financial Statements, Reports, Certificates. Borrower shall deliver the following to Bank: (a) as soon as available, but in any
event within thirty (30) days after the end of each calendar month, a company prepared consolidated balance sheet, income statement, and cash flow statement covering Borrower’s consolidated operations during such period, prepared in
accordance with GAAP (subject to year-end audit adjustments and the absence of footnotes, it being understood that monthly financial statements may not include updated valuations, revenue recognition, stock-based compensation and other procedures
that are required to prepare financial statements in accordance with GAAP but which are not customarily undertaken for monthly financial statements), consistently applied, in a form acceptable to Bank and certified by a Responsible Officer,
(b) as soon as available, but in any event within one hundred and eighty (180) days after the end of Borrower’s fiscal year, audited consolidated financial statements of Borrower prepared in accordance with GAAP, consistently applied,
together with an unqualified opinion on such financial statements of an independent certified public accounting firm reasonably acceptable to Bank; (c) copies of all statements, reports and notices sent or made available generally by Borrower
to its security holders or to any holders of Subordinated Debt and, if applicable, all reports on Forms 10-K and 10-Q filed with the Securities and Exchange Commission; (d) promptly upon receipt of notice thereof, a report of any legal actions
pending or threatened against Borrower or any Subsidiary that could result in damages or costs to Borrower or any Subsidiary of One Hundred Thousand Dollars ($100,000) or more; (e) as soon as available, but in any event within thirty
(30) days prior to the beginning of Borrower’s fiscal year, an annual operating budget, approved by Borrower’s Board of Directors and in a form acceptable to Bank; and (f) such budgets, sales projections, operating plans or other
financial information as Bank may reasonably request from time to time. For the purpose of this paragraph, monthly report and budget are prepared according to GAAP with the exception of revenues (which is included on a “billing” basis) and
stock based compensation (which is not included within those reports). 
 Prior to an Advance or within twenty (20) days after the last
day of each month when any Advances are outstanding, Borrower shall deliver to Bank a Borrowing Base Certificate signed by a Responsible Officer in substantially the form of Exhibit C hereto, together with aged listings of accounts receivable
and accounts payable. 

  
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 Borrower shall deliver to Bank with the monthly financial statements a Compliance Certificate
signed by a Responsible Officer in substantially the form of Exhibit D hereto. 
 Bank shall have a right from time to time hereafter
to audit Borrower’s Accounts and appraise Collateral at Borrower’s expense, provided that such audits will be conducted no more often than once every twelve (12) months and that such annual audit costs incurred under this provision or
under Section 4.3 shall not in the aggregate exceed $5,000 unless an Event of Default has occurred and is continuing in which case such costs shall not exceed $7,500. 

6.4 Inventory; Returns. Borrower shall keep all Inventory in good and marketable condition, free from all material defects except for
Inventory for which adequate reserves have been made. Returns and allowances, if any, as between Borrower and its account debtors shall be on the same basis and in accordance with the usual customary practices of Borrower, as they exist at the time
of the execution and delivery of this Agreement. Borrower shall promptly notify Bank of all returns and recoveries and of all disputes and claims, where the return, recovery, dispute or claim involves more than One Hundred Thousand Dollars
($100,000). 
 6.5 Taxes. Borrower shall make, and shall cause each Subsidiary to make, due and timely payment or deposit of all
material federal, state, and local taxes, assessments, or contributions required of it by law, and will execute and deliver to Bank, on demand, appropriate certificates attesting to the payment or deposit thereof; and Borrower will make, and will
cause each Subsidiary to make, timely payment or deposit of all material tax payments and withholding taxes required of it by applicable laws, including, but not limited to, those laws concerning F.I.C.A., F.U.T.A., state disability, and local,
state, and federal income taxes, and will, upon request, furnish Bank with proof satisfactory to Bank indicating that Borrower or a Subsidiary has made such payments or deposits; provided that Borrower or a Subsidiary need not make any payment if
the amount or validity of such payment is contested in good faith by appropriate proceedings and is reserved against (to the extent required by GAAP) by Borrower. 

6.6 Insurance. 

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

(b) All such policies of insurance shall be in such form, with such companies, and in such amounts as are reasonably satisfactory to
Bank. All such policies of property insurance shall contain a lender’s loss payable endorsement, in a form satisfactory to Bank, showing Bank as an additional loss payee thereof, and all liability insurance policies shall show the Bank as an
additional insured and shall specify that the insurer must give at least twenty (20) days notice to Bank before canceling its policy for any reason. Upon Bank’s request, Borrower shall deliver to Bank certified copies of such policies of
insurance and evidence of the payments of all premiums therefor. All proceeds payable under any such policy shall, at the option of Bank, be payable to Bank to be applied on account of the Obligations; provided however, so long as no Event of
Default has occurred and is continuing, proceeds of up to $250,000 payable under any such policy in the aggregate in any one year may be payable to Borrower to replace any Collateral subject to the claim or to purchase property useful to
Borrower’s business. 
 6.7 Accounts. Within 45 days of the Closing Date, Borrower shall maintain at least 50% of its
consolidated cash balances with Bank, including the primary U.S. operating account. In the case of any domestic deposit accounts not maintained with Bank, Borrower shall, prior to the initial Advance hereof, grant to Bank a first priority perfected
security interest in and “control” (within the meaning of Section 9104 of the California Uniform Commercial Code) of such deposit account pursuant to documentation acceptable to Bank. 

6.8 Financial Covenants. Borrower shall maintain compliance with one of the following covenants, to be measured on a monthly basis: 

(a) Asset Coverage Ratio. Borrower shall maintain at all times an Asset Coverage Ratio of at least 1.35 to 1.00, or 

(b) Adjusted Quick Ratio. Borrower shall maintain at all times an Adjusted Quick Ratio of at least 1.25 to 1.00. 

  
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 6.9 International Services. Borrower shall maintain all of its foreign exchange, hedging,
and letter of credit activities with Bank by utilizing Bank’s international services, unless Bank is unable to provide rates, terms and/or fees that are comparable or more favorable to the Borrower than those proposed, in good faith, by any
other bank or financial institution, and Borrower has provided Bank with the right of first refusal to provide such services at the rates, terms and/or fees proposed, in good faith, by such other bank or financial institution offering such services.

 6.10 Intellectual Property Rights. 

(a) Borrower shall promptly give Bank written notice of any applications or registrations of intellectual property rights filed with
the United States Patent and Trademark Office, including the date of such filing and the registration or application numbers, if any. Borrower shall (i) give Bank not less than 30 days prior written notice of the filing of any applications or
registrations with the United States Copyright Office, including the title of such intellectual property rights to be registered, as such title will appear on such applications or registrations, and the date such applications or registrations will
be filed, and (ii) prior to the filing of any such applications or registrations, shall execute such documents as Bank may reasonably request for Bank to maintain its perfection in such intellectual property rights to be registered by Borrower,
and upon the request of Bank, shall file such documents simultaneously with the filing of any such applications or registrations. Upon filing any such applications or registrations with the United States Copyright Office, Borrower shall promptly
provide Bank with (i) a copy of such applications or registrations, without the exhibits, if any, thereto, (ii) evidence of the filing of any documents requested by Bank to be filed for Bank to maintain the perfection and priority of its
security interest in such intellectual property rights, and (iii) the date of such filing. 
 (b) Bank may audit Borrower’s
Intellectual Property to confirm compliance with this Section, provided such audit may not occur more often than twice per year, unless an Event of Default has occurred and is continuing. Bank shall have the right, but not the obligation, to take,
at Borrower’s sole expense, any actions that Borrower is required under this Section to take but which Borrower fails to take, after 15 days’ notice to Borrower. Borrower shall reimburse and indemnify Bank for all reasonable costs and
reasonable expenses incurred in the reasonable exercise of its rights under this Section. 
 6.11 Further Assurances. At any time and
from time to time Borrower shall execute and deliver such further instruments and take such further action as may reasonably be requested by Bank to effect the purposes of this Agreement. 

7. NEGATIVE COVENANTS. 

Borrower will not do any of the following: 

7.1 Dispositions. Convey, sell, lease, transfer or otherwise dispose of (collectively, a “Transfer”), or permit any of its
Subsidiaries to Transfer, all or any part of its business or property, other than: (i) Transfers of Inventory in the ordinary course of business; (ii) Transfers of non-exclusive licenses and similar arrangements for the use of the property
of Borrower or its Subsidiaries in the ordinary course of business; (iii) Transfers of worn-out or obsolete Equipment which was not financed by Bank or (iv) Transfers in connection with Permitted Liens and Permitted Investments and other
transactions permitted under Section 7.6 hereof. 
 7.2 Change in Business; Change in Control or Executive Office. Engage in any
business, or permit any of its Subsidiaries to engage in any business, other than the businesses currently engaged in by Borrower and any business substantially similar or related thereto (or incidental thereto); or cease to conduct business in the
manner conducted by Borrower as of the Closing Date; or suffer or permit a Change in Control; or without thirty (30) days prior written notification to Bank, relocate its chief executive office or state of incorporation or change its legal
name; or without Bank’s prior written consent, change the date on which its fiscal year ends. 
 7.3 Mergers or Acquisitions.
Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with or into any other business organization, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of
another Person. 
 7.4 Indebtedness. Create, incur, assume or be or remain liable with respect to any Indebtedness, or permit any
Subsidiary so to do, other than Permitted Indebtedness. 

  
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 7.5 Encumbrances. Create, incur, assume or suffer to exist any Lien with respect to any of
its property, (including without limitation, its Intellectual Property) or assign or otherwise convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries so to do, except for Permitted Liens, or agree
with any Person other than Bank not to grant a security interest in, or otherwise encumber, any of its property, (including without limitation, its Intellectual Property) or permit any Subsidiary to do so except for negative pledges with respect to
property subject to a Lien described in clause (c) of the definition of “Permitted Liens”. 
 7.6 Distributions.
Pay any dividends or make any other distribution or payment on account of or in redemption, retirement or purchase of any capital stock, or permit any of its Subsidiaries to do so, except that Borrower may repurchase the stock of current or
former employees, directors or consultants pursuant to stock repurchase agreements as long as an Event of Default does not exist prior to such repurchase or would not exist after giving effect to such repurchase. 

7.7 Investments. Directly or indirectly acquire or own, or make any Investment in or to any Person, or permit any of its Subsidiaries so
to do, other than Permitted Investments; or subject to Section 6.7 hereof, or maintain or invest any of its property with a Person other than Bank or permit any of its Subsidiaries to do so unless such Person has entered into an account control
agreement with Bank in form and substance satisfactory to Bank; or suffer or permit any Subsidiary to be a party to, or be bound by, an agreement that restricts such Subsidiary from paying dividends or otherwise distributing property to Borrower.

 7.8 Transactions with Affiliates. Directly or indirectly enter into or permit to exist any material transaction with any
Affiliate of Borrower except for (i) transactions that are in the ordinary course of Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm’s length transaction with
a non-affiliated Person, (ii) transactions specifically described in the cost plus agreements between Borrower and each of the Subsidiaries provided to Bank on or prior to the Closing Date and as such may be effectuated or amended from time to
time and provided to Bank promptly upon its execution, (iii) intercompany loans and advances permitted under clause (d) of the definition of “Permitted Indebtedness”, (iv) compensation arrangements approved by
Borrower’s Board of Directors in the ordinary course of business, (v) transactions constituting Permitted Investments, and (vi) sale of equity securities to existing investors. 

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

7.10 Inventory and Equipment. Store the Inventory or the Equipment with a bailee, warehouseman, or other third party unless the third
party has been notified of Bank’s security interest and Bank (a) has received an acknowledgment from the third party that it is holding or will hold the Inventory or Equipment for Bank’s benefit or (b) is in pledge possession of
the warehouse receipt, where negotiable, covering such Inventory or Equipment. Store or maintain any Equipment or Inventory at a location other than the location set forth in Section 10 of this Agreement or as otherwise disclosed to Bank on the
Schedule of Exceptions or in writing within ten (10) days of engaging such location in storage or maintenance of Equipment or Inventory. 

7.11 Compliance. Become regulated as an “investment company” or be controlled by an entity regulated as an “investment
company,” within the meaning of the Investment Company Act of 1940, or become principally engaged in, or undertake as one of its important activities, the business of extending credit for the purpose of purchasing or carrying margin stock, or
use the proceeds of any Credit Extension for such purpose. Fail to meet the minimum funding requirements of ERISA, permit a Reportable Event or Prohibited Transaction, as defined in ERISA, to occur, fail to comply with the Federal Fair Labor
Standards Act or violate any law or regulation, which violation could have a Material Adverse Effect, or a material adverse effect on the Collateral or the priority of Bank’s Lien on the Collateral, or permit any of its Subsidiaries to do any
of the foregoing. 
 8. EVENTS OF DEFAULT. 

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

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

  
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 8.2 Covenant Default. 

(a) If Borrower fails to perform any obligation under Sections 6.3, 6.5, 6.6, 6.7, 6.8, or 6.9, or violates any of the covenants
contained in Article 7 of this Agreement; or 
 (b) If Borrower fails or neglects to perform or observe any other material term,
provision, condition, covenant contained in this Agreement, in any of the Loan Documents, or in any other present or future agreement between Borrower and Bank and as to any default under such other term, provision, condition or covenant that can be
cured, has failed to cure such default within ten days after Borrower receives notice thereof or any officer of Borrower becomes aware thereof; provided, however, that if the default cannot by its nature be cured within the ten day period or cannot
after diligent attempts by Borrower be cured within such ten day period, and such default is likely to be cured within a reasonable time, then Borrower shall have an additional reasonable period (which shall not in any case exceed 30 days) to
attempt to cure such default, and within such reasonable time period the failure to have cured such default shall not be deemed an Event of Default but no Credit Extensions will be made. 

8.3 Material Adverse Effect. If there occurs any circumstance or circumstances that could have a Material Adverse Effect; 

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

8.5 Insolvency. If Borrower becomes insolvent, or if an Insolvency Proceeding is commenced by Borrower, or if an Insolvency Proceeding
is commenced against Borrower and is not dismissed or stayed within forty five (45) days (provided that no Credit Extensions will be made prior to the dismissal of such Insolvency Proceeding); 

8.6 Other Agreements. If there is a default or other failure to perform in any agreement to which Borrower is a party or by which it is
bound resulting in a right by a third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an amount in excess of One Hundred Thousand Dollars ($100,000) or which could have a Material Adverse Effect;

 8.7 Judgments. If a judgment or judgments for the payment of money in an amount, individually or in the aggregate, of at least
One Hundred Thousand Dollars ($100,000) shall be rendered against Borrower and shall remain unsatisfied and unstayed for a period of ten (10) days (provided that no Credit Extensions will be made prior to the satisfaction or stay of such
judgment); or 
 8.8 Misrepresentations. If any material misrepresentation or material misstatement exists now or hereafter in
any warranty or representation set forth herein or in any certificate delivered to Bank by any Responsible Officer pursuant to this Agreement or to induce Bank to enter into this Agreement or any other Loan Document. 

9. BANK’S RIGHTS AND REMEDIES. 

9.1 Rights and Remedies. Upon the occurrence and during the continuance of an Event of Default, Bank may, at its election, without
notice of its election and without demand, do any one or more of the following, all of which are authorized by Borrower: 
 (a)
Declare all Obligations, whether evidenced by this Agreement, by any of the other Loan Documents, or otherwise, immediately due and payable (provided that upon the occurrence of an Event of Default described in Section 8.5, all Obligations
shall become immediately due and payable without any action by Bank); 

  
 16 

 (b) Cease advancing money or extending credit to or for the benefit of Borrower under
this Agreement or under any other agreement between Borrower and Bank; 
 (c) Settle or adjust disputes and claims directly with
account debtors for amounts, upon terms and in whatever order that Bank reasonably considers advisable; 
 (d) Make such payments and
do such acts as Bank considers necessary or reasonable to protect its security interest in the Collateral. Borrower agrees to assemble the Collateral if Bank so requires, and to make the Collateral available to Bank as Bank may designate. Borrower
authorizes Bank to enter the premises where the Collateral is located, to take and maintain possession of the Collateral, or any part of it, and to pay, purchase, contest, or compromise any encumbrance, charge, or lien which in Bank’s
determination appears to be prior or superior to its security interest and to pay all expenses incurred in connection therewith. With respect to any of Borrower’s owned premises, Borrower hereby grants Bank a license to enter into possession of
such premises and to occupy the same, without charge, in order to exercise any of Bank’s rights or remedies provided herein, at law, in equity, or otherwise; 

(e) Set off and apply to the Obligations any and all (i) balances and deposits of Borrower held by Bank, or (ii) indebtedness
at any time owing to or for the credit or the account of Borrower held by Bank; 
 (f) Ship, reclaim, recover, store, finish,
maintain, repair, prepare for sale, advertise for sale, and sell (in the manner provided for herein) the Collateral. Bank is hereby granted a license or other right, solely pursuant to the provisions of this Section 9.1, to use, without charge,
Borrower’s labels, patents, copyrights, rights of use of any name, trade secrets, trade names, trademarks, service marks, and advertising matter, or any property of a similar nature, as it pertains to the Collateral, in completing production
of, advertising for sale, and selling any Collateral and, in connection with Bank’s exercise of its rights under this Section 9.1, Borrower’s rights under all licenses and all franchise agreements shall inure to Bank’s benefit;

 (g) Dispose of the Collateral by way of one or more contracts or transactions, for cash or on terms, in such manner and at such
places (including Borrower’s premises) as Bank determines is commercially reasonable, and apply any proceeds to the Obligations in whatever manner or order Bank deems appropriate; 

(h) Bank may credit bid and purchase at any public sale; and 

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

9.2 Power of Attorney. Effective only upon the occurrence and during the continuance of an Event of Default, Borrower hereby irrevocably
appoints Bank (and any of Bank’s designated officers, or employees) as Borrower’s true and lawful attorney to: (a) send requests for verification of Accounts or notify account debtors of Bank’s security interest in the Accounts;
(b) endorse Borrower’s name on any checks or other forms of payment or security that may come into Bank’s possession; (c) sign Borrower’s name on any invoice or bill of lading relating to any Account, drafts against account
debtors, schedules and assignments of Accounts, verifications of Accounts, and notices to account debtors; (d) dispose of any Collateral; (e) make, settle, and adjust all claims under and decisions with respect to Borrower’s policies
of insurance; (f) settle and adjust disputes and claims respecting the accounts directly with account debtors, for amounts and upon terms which Bank determines to be reasonable; and (g) to file, in its sole discretion, one or more
financing or continuation statements and amendments thereto, relative to any of the Collateral. The appointment of Bank as Borrower’s attorney in fact, and each and every one of Bank’s rights and powers, being coupled with an interest, is
irrevocable until all of the Obligations have been fully repaid and performed and Bank’s obligation to provide Credit Extensions hereunder is terminated. 

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

  
 17 

 9.4 Bank Expenses. If Borrower fails to pay any amounts or furnish any required proof of
payment due to third persons or entities, as required under the terms of this Agreement, then Bank may do any or all of the following after reasonable notice to Borrower: (a) make payment of the same or any part thereof; (b) set up such
reserves under a loan facility in Section 2.1 as Bank deems necessary to protect Bank from the exposure created by such failure; or (c) obtain and maintain insurance policies of the type discussed in Section 6.6 of this Agreement, and
take any action with respect to such policies as Bank deems prudent. Any amounts so paid or deposited by Bank shall constitute Bank Expenses, shall be immediately due and payable, and shall bear interest at the then applicable rate hereinabove
provided, and shall be secured by the Collateral. Any payments made by Bank shall not constitute an agreement by Bank to make similar payments in the future or a waiver by Bank of any Event of Default under this Agreement. 

9.5 Bank’s Liability for Collateral. So long as Bank complies with reasonable banking practices, Bank shall not in any way or
manner be liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage thereto occurring or arising in any manner or fashion from any cause; (c) any diminution in the value thereof; or (d) any act or
default of any carrier, warehouseman, bailee, forwarding agency, or other person whomsoever. All risk of loss, damage or destruction of the Collateral shall be borne by Borrower. 

9.6 Remedies Cumulative. Bank’s rights and remedies under this Agreement, the Loan Documents, and all other agreements shall be
cumulative. Bank shall have all other rights and remedies not inconsistent herewith as provided under the Code, by law, or in equity. No exercise by Bank of one right or remedy shall be deemed an election, and no waiver by Bank of any Event of
Default on Borrower’s part shall be deemed a continuing waiver. No delay by Bank shall constitute a waiver, election, or acquiescence by it. No waiver by Bank shall be effective unless made in a written document signed on behalf
of Bank and then shall be effective only in the specific instance and for the specific purpose for which it was given. 
 9.7
Termination of Agreement. Notwithstanding any of Bank’s rights and remedies set forth above, upon the occurrence and during the continuance of an Event of Default, and if no Obligations are outstanding during such time (other than inchoate
indemnity obligations or Obligations related to Ancillary Services), Bank shall provide notice to Borrower with respect to any contemplated actions to be taken with respect to third parties or any public actions in connection with the exercise of
Bank’s rights and remedies set forth herein, and Borrower shall have two (2) Business Days following such notice to exercise its election to terminate the Agreement in accordance with this provision, in lieu of Bank’s taking of such
action; provided however, that on or prior to such termination, all Ancillary Services are cash collateralized on terms acceptable to Bank. 

9.8 Demand; Protest. Borrower waives demand, protest, notice of protest, notice of default or dishonor, notice of payment and
nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees at any time held by Bank on which Borrower may in any way be
liable. 
 10. NOTICES. 

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

			
	If to Borrower:	  	 Varonis Systems, Inc.
 1250 Broadway, 31st Floor
 New York, NY 10001

Attn: Yaki Faitelson
 FAX: (    )
                                        

		
	If to Bank:	  	 Bridge Bank, National Association
 55 Alamden
Blvd.
 San Jose, CA 95113
 Attn: Mike Field

FAX: (408) 282-1681

  
 18 

 The parties hereto may change the address at which they are to receive notices hereunder, by
notice in writing in the foregoing manner given to the other. 
 11. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER. 

This Agreement shall be governed by, and construed in accordance with, the internal laws of the State of California, without regard to
principles of conflicts of law. Each of Borrower and Bank hereby submits to the exclusive jurisdiction of the state and Federal courts located in the County of Santa Clara, State of California. BORROWER AND BANK EACH HEREBY WAIVE THEIR RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR
STATUTORY CLAIMS. EACH PARTY RECOGNIZES AND AGREES THAT THE FOREGOING WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR IT TO ENTER INTO THIS AGREEMENT. EACH PARTY REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT
IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. 
 12. JUDICIAL REFERENCE PROVISION.

 12.1 In the event the Jury Trial Waiver set forth above is not enforceable, the parties elect to proceed under this Judicial
Reference Provision. 
 12.2 With the exception of the items specified in Section 12.3, below, any controversy, dispute or claim
(each, a “Claim”) between the parties arising out of or relating to this Agreement or any other document, instrument or agreement between the undersigned parties (collectively in this Section, the “Loan
Documents”), will be resolved by a reference proceeding in California in accordance with the provisions of Sections 638 et seq. of the California Code of Civil Procedure (“CCP”), or their successor sections,
which shall constitute the exclusive remedy for the resolution of any Claim, including whether the Claim is subject to the reference proceeding. Except as otherwise provided in the Loan Documents, venue for the reference proceeding will be in the
state or federal court in the county or district where the real property involved in the action, if any, is located or in the state or federal court in the county or district where venue is otherwise appropriate under applicable law (the
“Court”). 
 12.3 The matters that shall not be subject to a reference are the following: (i) nonjudicial
foreclosure of any security interests in real or personal property, (ii) exercise of self-help remedies (including, without limitation, set-off), (iii) appointment of a receiver and (iv) temporary, provisional or ancillary remedies
(including, without limitation, writs of attachment, writs of possession, temporary restraining orders or preliminary injunctions). This reference provision does not limit the right of any party to exercise or oppose any of the rights and remedies
described in clauses (i) and (ii) or to seek or oppose from a court of competent jurisdiction any of the items described in clauses (iii) and (iv). The exercise of, or opposition to, any of those items does not waive the right of any
party to a reference pursuant to this reference provision as provided herein. 
 12.4 The referee shall be a retired judge or justice
selected by mutual written agreement of the parties. If the parties do not agree within ten (10) days of a written request to do so by any party, then, upon request of any party, the referee shall be selected by the Presiding Judge of the Court
(or his or her representative). A request for appointment of a referee may be heard on an ex parte or expedited basis, and the parties agree that irreparable harm would result if ex parte relief is not granted. Pursuant to CCP § 170.6, each
party shall have one peremptory challenge to the referee selected by the Presiding Judge of the Court (or his or her representative). 

12.5 The parties agree that time is of the essence in conducting the reference proceedings. Accordingly, the referee shall be requested,
subject to change in the time periods specified herein for good cause shown, to (i) set the matter for a status and trial-setting conference within fifteen (15) days after the date of selection of the referee, (ii) if practicable, try
all issues of law or fact within one hundred twenty (120) days after the date of the conference and (iii) report a statement of decision within twenty (20) days after the matter has been submitted for decision. 

  
 19 

 12.6 The referee will have power to expand or limit the amount and duration of discovery.
The referee may set or extend discovery deadlines or cutoffs for good cause, including a party’s failure to provide requested discovery for any reason whatsoever. Unless otherwise ordered based upon good cause shown, no party shall be entitled
to “priority” in conducting discovery, depositions may be taken by either party upon seven (7) days written notice, and all other discovery shall be responded to within fifteen (15) days after service. All disputes relating to
discovery which cannot be resolved by the parties shall be submitted to the referee whose decision shall be final and binding. 
 12.7
Except as expressly set forth herein, the referee shall determine the manner in which the reference proceeding is conducted including the time and place of hearings, the order of presentation of evidence, and all other questions that arise with
respect to the course of the reference proceeding. All proceedings and hearings conducted before the referee, except for trial, shall be conducted without a court reporter, except that when any party so requests, a court reporter will be used at any
hearing conducted before the referee, and the referee will be provided a courtesy copy of the transcript. The party making such a request shall have the obligation to arrange for and pay the court reporter. Subject to the referee’s power to
award costs to the prevailing party, the parties will equally share the cost of the referee and the court reporter at trial. 
 12.8
The referee shall be required to determine all issues in accordance with existing case law and the statutory laws of the State of California. The rules of evidence applicable to proceedings at law in the State of California will be applicable to the
reference proceeding. The referee shall be empowered to enter equitable as well as legal relief, enter equitable orders that will be binding on the parties and rule on any motion which would be authorized in a court proceeding, including without
limitation motions for summary judgment or summary adjudication. The referee shall issue a decision at the close of the reference proceeding which disposes of all claims of the parties that are the subject of the reference. Pursuant to CCP §
644, such decision shall be entered by the Court as a judgment or an order in the same manner as if the action had been tried by the Court and any such decision will be final, binding and conclusive. The parties reserve the right to appeal from the
final judgment or order or from any appealable decision or order entered by the referee. The parties reserve the right to findings of fact, conclusions of laws, a written statement of decision, and the right to move for a new trial or a different
judgment, which new trial, if granted, is also to be a reference proceeding under this provision. 
 12.9 If the enabling legislation
which provides for appointment of a referee is repealed (and no successor statute is enacted), any dispute between the parties that would otherwise be determined by reference procedure will be resolved and determined by arbitration. The arbitration
will be conducted by a retired judge or justice, in accordance with the California Arbitration Act §1280 through §1294.2 of the CCP as amended from time to time. The limitations with respect to discovery set forth above shall apply to any
such arbitration proceeding. 
 12.10 THE PARTIES RECOGNIZE AND AGREE THAT ALL CONTROVERSIES, DISPUTES AND CLAIMS RESOLVED UNDER THIS
REFERENCE PROVISION WILL BE DECIDED BY A REFEREE AND NOT BY A JURY. AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF ITS, HIS OR HER OWN CHOICE, EACH PARTY KNOWINGLY AND VOLUNTARILY, AND FOR THE MUTUAL BENEFIT OF ALL
PARTIES, AGREES THAT THIS REFERENCE PROVISION WILL APPLY TO ANY CONTROVERSY, DISPUTE OR CLAIM BETWEEN OR AMONG THEM ARISING OUT OF OR IN ANY WAY RELATED TO, THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS. 

13. GENERAL PROVISIONS. 

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

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

  
 20 

 13.3 Time of Essence. Time is of the essence for the performance of all obligations
set forth in this Agreement. 
 13.4 Severability of Provisions. Each provision of this Agreement shall be severable from every
other provision of this Agreement for the purpose of determining the legal enforceability of any specific provision. 
 13.5
Amendments in Writing, Integration. Neither this Agreement nor the Loan Documents can be amended or terminated orally. All prior agreements, understandings, representations, warranties, and negotiations between the parties hereto with respect to
the subject matter of this Agreement and the Loan Documents, if any, are merged into this Agreement and the Loan Documents. 
 13.6
Counterparts. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together,
shall constitute but one and the same Agreement. 
 13.7 Survival. All covenants, representations and warranties made in this
Agreement shall continue in full force and effect so long as any Obligations remain outstanding or Bank has any obligation to make Credit Extensions to Borrower. The obligations of Borrower to indemnify Bank with respect to the expenses, damages,
losses, costs and liabilities described in Section 13.2 shall survive until all applicable statute of limitations periods with respect to actions that may be brought against Bank have run. 

13.8 Confidentiality. In handling any confidential information Bank and all employees and agents of Bank, including but not limited to
accountants, shall exercise the same degree of care that it exercises with respect to its own proprietary information of the same types to maintain the confidentiality of any non-public information thereby received or received pursuant to this
Agreement except that disclosure of such information may be made (i) to the subsidiaries or affiliates of Bank in connection with their present or prospective business relations with Borrower, (ii) to prospective transferees or purchasers
of any interest in the Loans, provided that they have entered into a comparable confidentiality agreement in favor of Borrower and have delivered a copy to Borrower, (iii) as required by law, regulations, rule or order, subpoena, judicial order
or similar order, (iv) as may be required in connection with the examination, audit or similar investigation of Bank and (v) as Bank may determine in connection with the enforcement of any remedies hereunder. Confidential information
hereunder shall not include information that either: (a) is in the public domain or in the knowledge or possession of Bank when disclosed to Bank, or becomes part of the public domain after disclosure to Bank through no fault of Bank; or
(b) is disclosed to Bank by a third party, provided Bank does not have actual knowledge that such third party is prohibited from disclosing such information. 

13.9 Patriot Act. To help the government fight the funding of terrorism and money laundering activities, Federal law requires all
financial institutions to obtain, verify, and record information that identifies each person who opens an account WHAT THIS MEANS FOR YOU: when you open an account, we will ask your name, address, date of birth, and other information that will allow
us to identify you. We may also ask to see your driver’s license or other identifying documents. 

  
 21 

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

							
		 		 	VARONIS SYSTEMS, INC.
				
	

	 		 	By:	 	 /s/ Yakov Faitelson

	 		 	Title:	 	CEO
	 		 	  
 BRIDGE BANK,
NATIONAL ASSOCIATION

				
		 		 	By:	 	 /s/ Paul Duren

		 		 	Title:	 	Vice President

  
 22 

 SCHEDULE OF EXCEPTIONS 

Section 1.1 
 Permitted Indebtedness 

 

					
	 Accounts payable
	  	$	370K	  
	 Accrued expenses
	  	$	418K	  
	 Employee and Employee institution
	  	$	2,141K	  
	 Other short term liabilities
	  	$	293K	  

  

	*	Not including deferred income and holiday accrual 

	**	As of Sep 30, 2011 

 Permitted Investments 

 

					
	 Investment
	  	$ amount	 
	 Investment in Israeli Subsidiary
	  	 	1,324K	  
	 Investment in German Subsidiary
	  	 	35.9K	  
	 Investment in UK Subsidiary
	  	 	2.3K	  

 The following subsidiaries are fully owned by the Borrower: 

 

	 	•	 	Varonis Systems Ltd., an Israeli company 

  

	 	•	 	Varonis (UK) Limited, a UK company 

  

	 	•	 	Varonis Systems (Deutschland) GmbH, a German company 

 Permitted Liens 

Liens existing on the Closing Date: 
  

	 	1.	Leumi Bank Israel guarantees in favor of (i) Ben-Zur and Dorianov Ltd. in connection with the office lease of the Israeli subsidiary, and (ii) Ramot Business Center Dorianov Ltd. in connection with the
management agreement of the Israeli offices, in the aggregate amount of in the amount of US$80,000, in order to secure the Israeli subsidiary’s obligations pursuant to such lease agreement. 

 

	 	2.	Leumi Bank Israel guarantees in favor of Sigalit Top Holdings Ltd. in connection with the office lease of the Israeli subsidiary in the amount of US$20,460, in order to secure the Israeli subsidiary’s obligations
pursuant to such lease agreement. 

  

	 	3.	Leumi Bank Israel guarantees in favor of A.Y.A.A. Investment Ltd. in connection with the office lease of the Israeli subsidiary in the amount of NIS 137,100, in order to secure the Israeli subsidiary’s obligations
pursuant to such lease agreement. 

  

	 	4.	The Borrower has deposited $5,650 with Equity Residential Management, LLC as a security, in order to secure the Borrower’s obligations under that certain Agreement of Lease between the Borrower and Equity
Residential Management, LLC dated as of October 8, 2011. 

  
 1 

	 	5.	The Borrower has deposited $75,000 with 499 Fashion Tower, LLC as a security, in order to secure the Borrower’s obligations under that certain Agreement of Lease between the Borrower and 499 Fashion Tower, LLC
dated as of July 1, 2008. 

  

	 	6.	The Borrower has deposited $39,655 with 535 Eight Avenue, LLC as a security, in order to secure the Borrower’s obligations under that certain Agreement of Lease between the Borrower and 535 Eight Avenue, LLC dated
as of March 26, 2010. 

  

	 	7.	Letter of Credit to be issued by Bank Leumi USA on the name of JT MH 1250 Owner LP in the amount of $100,000, in order to secure the Varonis’ obligations under that certain lease agreement dated as of
October 19, 2011 regarding the NY office. 

  

	 	8.	Deposit in the amount of $50,000 at Bridge Bank in order to secure the use of the Company’s credit card. 

  

	 	9.	Collateral of $240,000 (such amount may vary based on the actual exposure to the bank) in favor to Leumi Bank USA with respect to hedging transactions of foreign currency. The funds under the collateral may be increased
dependable on future hedging transactions. 

 Section 5.6: 

The company embeds to its software certain Open-source software which are not owned by it, but are used pursuant to a valid license. 

Sections 5.7 and 7.10: 
  

	 	•	 	The Borrower’s official address as of November 11, 2011 shall be 1250 Broadway, 31st Floor, New York, NY 10001. By December 31, 2011 the Borrower shall no longer have any possession in the following
addresses (until then certain of the Equipment may be located there): 

  

	 	•	 	499 7th Ave., 23rd Floor – South Tower, New York, NY 

 

	 	•	 	535 Eight Avenue, New York, NY 

  

	 	•	 	The Borrower’s and its subsidiaries provide laptops and other electronic equipment such us printers, scanners and phones to their employees and therefore, such equipment may not be located at the Borrower’s
offices indicated in Section 10 of the agreement. 

 Sections 5.16 and Error! Reference source not found.: 

The Borrower and its subsidiaries maintain the following bank accounts: 
  

					
	 Bank Name/Address
	  	 Account Holder Name
	  	Account (Type & Number)
	Bank Leumi USA, Silicon Valley Branch/ 2000 University Avenue, suite 605 Palo Alto, CA, 94303	  	Varonis Systems, Inc.	  	Account # 8200205301
			
	 Bridge Bank USA,
 55 Almaden Blvd.

San Jose, CA 95113
	  	Varonis Systems, Inc.	  	Account # 0101137776
			
	 Leumi Bank Israel/
 I Zabutinski St., Ramat Gan,
Israel
	  	Varonis Systems Ltd.	  	Regular Account # 81400/91
			
	 Bank Leumi (UK) plc/
 20 Stratford Place, London
W1C 1BG
	  	Varonis (UK) Limited	  	GBP Account # 0066928001
			
	 Deutsche Bank

Konto 6280168 00,

BLZ 370 700 24,

BIC DEUTDEDBKOE
	  	 Varonis Systems
 (Deutschland) GmbH
	  	IBAN DE22 370 700 240 6280168 00

  
 2 

 EXHIBIT A 
  

			
	DEBTOR:	  	VARONIS SYSTEMS, INC.
		
	SECURED PARTY:	  	BRIDGE BANK, NATIONAL ASSOCIATION

 COLLATERAL DESCRIPTION ATTACHMENT 

TO LOAN AND SECURITY AGREEMENT 

All personal property of Borrower (herein referred to as “Borrower” or “Debtor”) whether presently existing or hereafter
created or acquired, and wherever located, including, but not limited to: 
 (a) all accounts (including health-care-insurance receivables),
chattel paper (including tangible and electronic chattel paper), deposit accounts, documents (including negotiable documents), equipment (including all accessions and additions thereto), general intangibles (including payment intangibles and
software), goods (including fixtures), instruments (including promissory notes), inventory (including all goods held for sale or lease or to be furnished under a contract of service, and including returns and repossessions), investment property
(including securities and securities entitlements), letter of credit rights, money, and all of Debtor’s books and records with respect to any of the foregoing, and the computers and equipment containing said books and records; 

(b) any and all cash proceeds and/or noncash proceeds of any of the foregoing, including, without limitation, insurance proceeds, and all
supporting obligations and the security therefor or for any right to payment. All terms above have the meanings given to them in the California Uniform Commercial Code, as amended or supplemented from time to time. 

Notwithstanding the foregoing, the Collateral shall not include any (i) intellectual property, including without limitation copyrights,
patents, trademarks, servicemarks and applications therefor, now owned or hereafter acquired, or any claims for damages by way of any past, present and future infringement of any of the foregoing (collectively, the “Intellectual
Property”); provided, however, that the Collateral shall include all accounts and general intangibles that consist of rights to payment and proceeds from the sale, licensing or disposition of all or any part, or rights in, the foregoing (the
“Rights to Payment”), or (ii) property that (A) constitutes the capital stock of a controlled foreign corporation (as such term is defined in the IRC) in excess of 65% of the voting power of all classes of capital stock of such
controlled foreign corporation entitled to vote, or (B) consists of property financed by a third party permitted by clause (c) of the definition of “Permitted Liens” hereunder to the extent prohibited by the terms of such
agreement, provided that upon the termination or lapse of any such prohibition, such property shall automatically become part of the Collateral. Notwithstanding the foregoing, if a judicial authority (including a U.S. Bankruptcy Court) holds that a
security interest in the underlying Intellectual Property is necessary to have a security interest in the Rights to Payment, then the Collateral shall automatically, and effective as of the Closing Date, include the Intellectual Property to the
extent necessary to permit perfection of Bank’s security interest in the Rights to Payment. 

  
 23 

 EXHIBIT B 

REVOLVING ADVANCE REQUEST 

(To be submitted no later than 3:00 PM to be considered for same day processing) 

 

			
	To:	  	Bridge Bank, National Association
		
	Fax:	  	(408) 282-1681
		
	Date:	  	  

		
	From:	  	VARONIS SYSTEMS, INC.
		
		  	Borrower’s Name
		
		  	  

		  	Authorized Signature
		
		  	  

		  	Authorized Signer’s Name (please print)
		
		  	  

		  	Phone Number

  

			
	To Account #	  	  

 Borrower hereby requests funding in the amount of
$             in accordance with the Revolving Advance as defined in the Loan and Security Agreement dated November 14, 2011. 

Borrower hereby authorizes Lender to rely on facsimile stamp signatures and treat them as authorized by Borrower for the purpose of requesting the above
advance. 
 All representations and warranties of Borrower stated in the Loan and Security Agreement are true, correct and complete in all material respects
as of the date of this Revolving Advance Request; provided that those representations and warranties expressly referring to another date shall be true, correct and complete in all material respects as of such date. 

Capitalized terms used herein and not otherwise defined have the meanings set forth in the Loan and Security Agreement. 

  
 24 

 EXHIBIT C 

BORROWING BASE CERTIFICATE 

  
 25 

 EXHIBIT D 

COMPLIANCE CERTIFICATE 
  

			
	TO:	  	BRIDGE BANK, NATIONAL ASSOCIATION
		
	FROM:	  	VARONIS SYSTEMS, INC.

 The undersigned authorized officer of VARONIS SYSTEMS, INC. hereby certifies that in accordance with the terms
and conditions of the Loan and Security Agreement between Borrower and Bank (the “Agreement”), (i) Borrower is in complete compliance for the period ending             
with all required covenants except as noted below and (ii) all representations and warranties of Borrower stated in the Agreement are true and correct as of the date hereof. Attached herewith are the required documents supporting the above
certification. The Officer further certifies that these are prepared in accordance with Generally Accepted Accounting Principles (GAAP) and are consistently applied from one period to the next except as explained in an accompanying letter or
footnotes. 
 Please indicate compliance status by circling Yes/No under “Complies” column. 

 

											
	 Reporting Covenant
	  	 Required
	  	Complies	 
				
	 Annual financial statements (CPA Audited)
	  	FYE within 180 days	  	 	Yes	  	  	 	No	  
				
	 Monthly financial statements and Compliance Certificate
	  	Monthly within 30 days	  	 	Yes	  	  	 	No	  
				
	 l0 K and l0Q
	  	(as applicable)	  	 	Yes	  	  	 	No	  
				
	 Annual operating budget approved by board of directors
	  	Annually no later than 30 days prior to the beginning of each fiscal year	  	 	Yes	  	  	 	No	  
				
	 A/R & A/P Agings, Borrowing Base Certificate
	  	Prior to each Credit Extension, and monthly within 20 days when there are any unpaid Credit Extensions	  	 	Yes	  	  	 	No	  
				
	 A/R Audit
	  	Initial and Annual	  	 	Yes	  	  	 	No	  
				
	 Deposit balances with Bank
	  	$                            	  				  			
	 Deposit balance outside Bank
	  	$                            	  				  			

  

																	
	 Financial Covenant
	  	Required	 	  	Actual	 	  	Complies	 
	 Minimum Adjusted Quick Ratio OR 
	  	 	1.25 to 1.00	  	  	 	    :1.00	  	  	 	Yes	  	  	 	No	  
	 Minimum Asset Coverage Ratio
	  	 	1.35 to 1.00	  	  	 	:1.00	  	  	 	Yes	  	  	 	No	  

 

	
	 Comments Regarding Exceptions: See Attached.
  

	Sincerely,
	  

	SIGNATURE
	  

	TITLE
	  

	DATE

	
	 BANK USE ONLY
  

	Received
by:                                        
                                         
                 
	 AUTHORIZED SIGNER

	Date:                                     
                                         
                                  
	
	Verified:                                    
                                         
                            
	 AUTHORIZED SIGNER

	
Date:                         
                                         
                                         
     
  

	Compliance
Status                                     Yes
             No

 
 

  
 26EX-10.5

 Exhibit 10.5 

 
 LOAN AND SECURITY MODIFICATION AGREEMENT 

 
 This Loan and Security Modification Agreement is entered into
as of May 29, 2012 by and between VARONIS SYSTEMS. INC. (the “Borrower”) and BRIDGE BANK, NATIONAL ASSOCIATION (“Bank”). 
  

1. DESCRIPTION OF EXISTING INDEBTEDNESS: Borrower has entered into a Loan and Security Agreement, dated November 14, 2011 with the Bank, as
may be amended from time to time (the “Loan and Security Agreement”). Capitalized terms used without definition herein shall have the meanings assigned to them in the Loan and Security Agreement. The Loan and Security Agreement and any and
all other documents executed by Borrower in favor of Bank in connection with the Loan and Security Agreement shall be referred to as the “Existing Documents.” 

 
 2. DESCRIPTION OF CHANGE IN TERMS. 

 

	 	A.	 	Modifications to Loan and Security Agreement: 

  

1. Clause (g)(ii) of the defined term “Permitted Investments” set forth in Section 1.1 is amended in its entirety to read
as follows: 
  
 (ii) of Borrower in or to its
Subsidiaries in an amount not to exceed $100,000 in any fiscal year; provided however that, in the first year of existence of Borrower’s French Subsidiary, Borrower’s Investments in its French Subsidiary may exceed the foregoing amounts,
but shall not exceed the lesser of (A) the amounts necessary to support the French Subsidiary’s operations in its first year, or (B) $1,200,000 in the aggregate; and 
  
 2. Section 5.14 is amended in its entirety to read as follows: 

 
 5.14 Subsidiaries. Borrower does not own any stock,
partnership interest or other equity securities of any Person, except for Borrower’s ownership of all of the outstanding capital stock of each of the following wholly owned Subsidiaries: Varonis France SAS, a French company, Varonis Systems
Ltd., an Israeli company, Varonis (UK) Limited, a UK company, and Varonis Systems (Deutschland) GmbH, a German company. 
  

	 	B.	 	Notwithstanding the prohibition set forth in Section 7.5, Bank consents to the Borrower’s agreement with TriplePoint Capital, LLC not to grant a security
interest in, or otherwise encumber, any of its property (including its intellectual property). 

  

	 	C.	 	The Schedule of Exceptions attached to the Loan and Security Agreement is replaced in its entirety with the Schedule of Exceptions attached hereto.

  
 3. CONSISTENT CHANGES. The Existing
Documents are each hereby amended wherever necessary to reflect the changes described above. 
  
 4. CONTINUING VALIDITY. Borrower understands and agrees that in modifying the Existing Documents, Bank is relying upon Borrower’s representations, warranties, and agreements, as set forth in
the Existing Documents. Borrower represents and warrants that the representations and warranties contained in the Loan and Security Agreement are true and correct as of the date of this Loan and Security Modification Agreement, and that no Event of
Default has occurred and is continuing. Except as expressly modified pursuant to this Loan and Security Modification Agreement, the terms of the Existing Documents remain unchanged and in full force and effect. Bank’s agreement to modifications
to the Existing Documents pursuant to this Loan and Security Modification Agreement in no way shall obligate Bank to make any future 

  
 1 

 
modifications to the Existing Documents. It is the intention of Bank and Borrower to retain as liable parties all makers and endorsers of Existing Documents, unless the party is expressly
released by Bank in writing. No maker, endorser, or guarantor will be released by virtue of this Loan and Security Modification Agreement. 
  

5. CONDITIONS. As a condition to the effectiveness of this Loan and Security Modification Agreement, Bank shall have received, in form and
substance satisfactory to Bank, the following: 
  

	 	(a)	 	this Loan and Security Modification Agreement, duly executed by Borrower; 

 

	 	(b)	 	an intercreditor agreement with TriplePoint Capital LLC; 

  

	 	(c)	 	the Schedule of Exceptions; and 

  

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

 
 [SIGNATURE PAGE FOLLOWS] 

  
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 6. COUNTERSIGNATURE. This Loan and Security Modification Agreement shall become effective only when
executed by Bank, Borrower, and Guarantor. 
  

									
	BORROWER:	 		 	BANK:
			
	VARONIS SYSTEMS, INC.	 		 	BRIDGE BANK, NATIONAL ASSOCIATION
					
	 By:
	 	 /s/ YAKI FAITELSON
	 		 	By:	 	 /s/ Blake Reid

	 Name:
	 	YAKI FAITELSON	 		 	Name:	 	 Blake Reid

	 Title:
	 	CEO	 		 	Title:	 	 Vice President

  
 3 

 SCHEDULE OF EXCEPTIONS 
  
 Permitted Indebtedness (Section 1.1) 

 

					
	 Accounts payable
	  	$	463K	  
	 Accrued expenses
	  	$	549K	  
	 Employee and Employee institution
	  	$	2,521K	  
	 Other short term liabilities
	  	$	315 K	  

  

	*	 	Not including deferred income and holiday accrual 

	**	 	As of March 31, 2012 

  

Indebtedness in the aggregate principal amount of $20,000,000 owing to TriplePoint Capital, LLC  

 
 Permitted Investments (Section 1.1) 

 

					
	 Investment
	  	 	$ amount	  
	 Investment in Israeli Subsidiary
	  	 	(1,324K	) 
	 Investment in German Subsidiary
	  	 	(35.9K	) 
	 Investment in UK Subsidiary
	  	 	(0.2K	) 
	 Investment in French Subsidiary
	  	 	(l.0K	) 

  
 Borrower
owns the outstanding capital stock of the following wholly owned Subsidiaries of Borrower: 
  

	 	•	 	 Varonis Systems Ltd., an Israeli company 

  

	 	•	 	 Varonis (UK) Limited, a UK company 

  

	 	•	 	 Varonis Systems (Deutschland) GmbH, a German company 

 

	 	•	 	 Varonis France SAS, a French company 

  

The Borrower may enter into derivative instrument arrangements to hedge a portion of its anticipated expenses in new Israeli shekel (NIS), British Pound
(GBP) and EUR, provided such arrangements that are not contrary to, and Borrower has fully complied with, Borrower’s obligations under Section 6.9 of the Agreement. 

 
 Permitted Liens (Section 1.1)

  
 Existing Liens: 

 

	 	1.	 	Leumi Bank Israel guarantees in favor of (i) Ben-Zur and Dorianov Ltd. in connection with the office lease of the Israeli subsidiary in the amount of US$60,000,
and (ii) Ramot Business Center Dorianov Ltd. in connection with the management agreement of the Israeli offices in the amount of NIS47,809, in order to secure the Israeli subsidiary’s obligations pursuant to such lease agreement.

  

	 	2.	 	Leumi Bank Israel guarantees in favor of Sigalit Top Holdings Ltd. in connection with the office lease of the Israeli subsidiary in the amount of US$20,460, in order to
secure the Israeli subsidiary’s obligations pursuant to such lease agreement. 

  

	 	3.	 	Leumi Bank Israel guarantees in favor of A.Y.A.A. Investment Ltd. in connection with the office lease of the Israeli subsidiary in the amount of NIS 137,100, in order
to secure the Israeli subsidiary’s obligations pursuant to such lease agreement. 

  

	 	4.	 	The Borrower has deposited $5,650 with Equity Residential Management, LLC as a security, in order to secure the Borrower’s obligations under that certain Agreement
of Lease between the Borrower and Equity Residential Management, LLC dated as of October 8, 2011. 

	 	5.	 	Letter of Credit issued by Bank Leumi USA on the name of JT MH 1250 Owner LP in the amount of $85,737, in order to secure the Borrower’s obligations under that
certain lease agreement dated October 19, 2011 regarding the NY office. 

  

	 	6.	 	Deposit in the amount of $50,000 at Bridge Bank in order to secure the use of the Company’s credit card. 

 

	 	7.	 	Collateral of 10% of any open transaction (such amount may vary based on the actual exposure to the bank) in favor to Leumi Bank Israel with respect to hedging
transactions of foreign currency. The funds under the collateral may be increased dependable on hedging losses. 

  

	 	8.	 	Liens in favor of TriplePoint Capital, LLC, which are subject to an intercreditor agreement with Bank. 

 
 Inbound Licenses (Section 5.6)

  
 The company embeds to its software certain open-source software
which are not owned by it, but are used pursuant to a valid license. 
  
 Names; Locations (Sections 5.7; Section 7.10): 
  

	 	•	 	 The Borrower’s official address is 1250 Broadway, 31st Floor, New York, NY 10001. 

 

	 	•	 	 The Borrower’s and its subsidiaries provide laptops and other electronic equipment such us printers, scanners and phones to their employees and
therefore, such equipment may not be located at the Borrower’s offices indicated in Section 10 of the agreement. In addition, Borrower holds a server at Cogent with a value of approximately $35K. 

 
 Litigation (Section 5.8) 

 
 None 

 
 Accounts (Section 5.16) 

 
 The Borrower and its subsidiaries maintain
the following bank accounts: 
  

					
	 Bank Name/Address
	  	 Account Holder Name
	  	Account (Type & Number)
	 Bank Leumi USA, Silicon Valley Branch/ 2000 University Avenue, suite 605
 Palo Alto, CA, 94303
	  	Varonis Systems, Inc.	  	Account #8200205301
			
	 Leumi Bank Israel/
 1
Zabutinski St., Ramat Gan, Israel
	  	Varonis Systems Ltd.	  	Regular Account # 81400/91
			
	 Bank Leumi (UK) plc/
 20
Stratford Place, London W1C 1BG
	  	Varonis (UK) Limited	  	GBP Account # 0066928001
			
	 Deutsche Bank
 Konto
628016800,
 BLZ 370 700 24,
 BIC
DEUTDEDBKOE
	  	 Varonis Systems
 (Deutschland)
GmbH
	  	IBAN DE22 370 700 240 6280168 00

  
 2 

					
	 Caisse desDepots
 Services
Bancaires
 Telephone: 01 40 97 31 67

Fax: 01 40 97 30 04
	  	Varonis France SAS	  	IBAN FR69 4003 1000 0100
 0012 2036 X06

			
	BNP Paribas	  	Varonis France SAS	  	BIC: BNPAFRPPPAC
 IBAN : FR76 3000 4008

2800 0120 1399 176

			
	The Borrower is in the process of opening a new bank account with a commercial bank in Israel	  	Varonis Systems, Inc.	  	
			
	PayPal	  	Varonis Systems, Inc.	  	Merchant account ID
 E8VXDBU26C9BA

  
 3

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