Document:

Exhibit 10.4

Exhibit 10.4

AMENDED AND RESTATED ADVISORY AGREEMENT

     THIS AMENDED AND RESTATED ADVISORY AGREEMENT, dated as of October 1, 2009, is among CORPORATE
PROPERTY ASSOCIATES 17 — GLOBAL INCORPORATED, a Maryland corporation (“CPA: 17”), CPA: 17
LIMITED PARTNERSHIP, a Delaware limited partnership of which CPA: 17 is a general partner (the
“Operating Partnership”), and CAREY ASSET MANAGEMENT CORP., a Delaware corporation and
wholly-owned subsidiary of W. P. Carey & Co. LLC (the “Advisor”).

W I T N E S S E T H:

     WHEREAS, CPA: 17 intends to qualify as a REIT (as defined below), and the Operating
Partnership intends to qualify as a partnership, in each case for U.S. federal income tax purposes;

     WHEREAS, CPA:17, the Operating Partnership and the Advisor entered into an initial advisory
agreement, dated November 12, 2007, which the parties desire to amend and restate;

     WHEREAS, CPA: 17 and its subsidiaries, including the Operating Partnership, desire to continue
to avail themselves of the experience, sources of information, advice and assistance of, and
certain facilities available to, the Advisor and to have the Advisor undertake the duties and
responsibilities hereinafter set forth, on behalf of, and subject to the supervision of the Board
of Directors of CPA: 17, all as provided herein; and

     WHEREAS, the Advisor is willing to continue to render such services, subject to the
supervision of the Board of Directors, on the terms and conditions hereinafter set forth;

     NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements
contained herein, the parties hereto agree as follows:

     1. Definitions. As used in this Agreement, the following terms have the definitions
hereinafter indicated:

     “2%/25% Guidelines.” The requirement, as provided for in Section 13 hereof, that, in
the 12-month period ending on the last day of any fiscal quarter, Operating Expenses not exceed the
greater of two percent of Average Invested Assets during such 12-month period or 25% of CPA: 17’s
Adjusted Net Income over the same 12-month period.

     “Acquisition Expenses.” To the extent not paid or to be paid by the seller, lessee,
borrower or any other party involved in the transaction, those expenses, including but not limited
to travel and communications expenses, the cost of appraisals, title insurance, nonrefundable
option payments on Investments not acquired, legal fees and expenses, accounting fees and expenses
and miscellaneous expenses, related to selection, acquisition and origination of Investments,
whether or not a particular Investment ultimately is made. Acquisition Expenses shall not include
Acquisition Fees.

     “Acquisition Fees.” The Initial Acquisition Fee and the Subordinated Acquisition Fee.

 

 

     “Adjusted Investor Capital.” As of any date, the Initial Investor Capital reduced by
any Redemptions, other than Redemptions intended to qualify as a liquidity event for purposes of
this Agreement, and by any other Distributions on or prior to such date determined by the Board to
be from Cash from Sales and Financings.

     “Adjusted Net Income.” For any period, the total consolidated revenues recognized in
such period by CPA: 17, less the total consolidated expenses of CPA: 17 recognized in such period,
excluding additions to reserves for depreciation and amortization, bad debts or other similar
non-cash reserves; provided, however, that Adjusted Net Income for purposes of calculating total
allowable Operating Expenses shall exclude any gain, losses or writedowns from the sale of CPA:
17’s assets.

     “Advisor.” Carey Asset Management Corp, a corporation organized under the laws of the
State of Delaware and wholly-owned by W. P. Carey & Co. LLC.

     “Affiliate.” An Affiliate of another Person shall include any of the following: (i)
any Person directly or indirectly owning, controlling, or holding, with power to vote ten percent
or more of the outstanding voting securities of such other Person; (ii) any Person ten percent or
more of whose outstanding voting securities are directly or indirectly owned, controlled, or held,
with power to vote, by such other Person; (iii) any Person directly or indirectly controlling,
controlled by, or under common control with such other Person; (iv) any executive officer,
director, trustee or general partner of such other Person; or (v) any legal entity for which such
Person acts as an executive officer, director, trustee or general partner.

     “Agreement.” This Advisory Agreement.

     “Appraised Value.” Value according to an appraisal made by an Independent Appraiser,
which may take into consideration any factor deemed appropriate by such Independent Appraiser,
including, but not limited to, the terms and conditions of any lease of a relevant property, the
quality of any lessee’s, borrower’s or other counter-party’s credit and the conditions of the
credit markets. The Appraised Value of a Property may be greater than the construction cost or the
replacement cost of the Property.

     “Articles of Incorporation.” Articles of Incorporation of CPA: 17 under the General
Corporation Law of Maryland, as amended from time to time, pursuant to which CPA: 17 is organized.

     “Asset Management Fee.” The Asset Management Fee as defined in Section 9(a) hereof.

     “Average Equity Value.” The equity portion of the aggregate purchase price paid by
CPA: 17 for an Investment, provided that, if (1) a later Appraised Value is obtained for the
Investment, that later Appraised Value, adjusted for other net assets and liabilities that have
economic value and are associated with that Investment, shall become the basis for calculating the
Average Equity Market Value of the Investment, and (2) for Investments in securities that CPA: 17
treats as available for sale under GAAP, the fair value of such securities as determined on a
monthly basis as of the last day of each month or, if applicable, on the date the securities are
disposed of, shall be the basis for calculating the Average Equity Market Value of such securities.

     “Average Invested Assets.” The average during any period of the aggregate book value
of CPA: 17’s Investments, before deducting reserves for depreciation, bad debts, impairments,
amortization and all other non-cash reserves, computed by taking the average of such values at the
end of each month during such period.

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     “Average Market Value.” The aggregate purchase price paid by CPA: 17 for an
Investment, provided that, if a later Appraised Value is obtained for the Investment, that later
Appraised Value, adjusted for other net assets and liabilities that have economic value and are
associated with that Investment, shall become the Average Market Value for the Investment.

     “B Note.” A note representing a subordinated interest in a Loan secured by a first
mortgage on a Property.

     “Board or Board of Directors.” The Board of Directors of CPA: 17.

     “Bylaws.” The bylaws of CPA: 17.

     “Cash from Financings.” Net cash proceeds realized by CPA: 17 from the financing of
Investments or the refinancing of any indebtedness of CPA: 17.

     “Cash from Sales.” Net cash proceeds realized by CPA: 17 from the sale, exchange or
other disposition of any of its Investments after deduction of all expenses incurred in connection
therewith. Cash from Sales shall not include Cash from Financings.

     “Cash from Sales and Financings.” The total sum of Cash from Sales and Cash from
Financings.

     “Cause.” With respect to the termination of this Agreement, fraud, criminal conduct,
willful misconduct or willful or negligent breach of fiduciary duty by the Advisor that, in each
case, is determined by a majority of the Independent Directors to be materially adverse to CPA: 17,
or a breach of a material term or condition of this Agreement by the Advisor and the Advisor has
not cured such breach within 30 days of written notice thereof or, in the case of any breach that
cannot be cured within 30 days by reasonable effort, has not taken all necessary action within a
reasonable time period to cure such breach.

     “Change of Control.” A change of control of CPA: 17 of a nature that would be
required to be reported in response to the disclosure requirements of Schedule 14A of Regulation
14A promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
as enacted and in force on the date hereof, whether or not CPA: 17 is then subject to such
reporting requirements; provided, however, that, without limitation, a Change of Control shall be
deemed to have occurred if: (i) any “person” (within the meaning of Section 13(d) of the Exchange
Act, as enacted and in force on the date hereof) is or becomes the “beneficial owner” (as that term
is defined in Rule 13d-3, as enacted and in force on the date hereof, under the Exchange Act) of
securities of CPA: 17 representing 8.5% or more of the combined voting power of CPA: 17’s
securities then outstanding; (ii) there occurs a merger, consolidation or other reorganization of
CPA: 17 which is not approved by the Board; (iii) there occurs a sale, exchange, transfer or other
disposition of substantially all of the assets of CPA: 17 to another entity, which disposition is
not approved by the Board; or (iv) there occurs a contested proxy solicitation of the Shareholders
of CPA: 17 that results in the contesting party electing candidates to a majority of the Board’s
positions next up for election.

     “Closing Date.” The first date on which Shares were issued pursuant to an Offering.

     “Code.” Internal Revenue Code of 1986, as amended.

     “Competitive Real Estate Commission.” The real estate or brokerage commission paid
for the purchase or sale of a Property that is reasonable, customary and competitive in light of
the size, type and location of the Property.

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     “Construction Fee.” A fee or other remuneration for acting as general contractor
and/or construction manager to construct improvements, supervise and coordinate projects or to
provide major repairs or rehabilitation on a Property.

     “Contract Purchase Price.” The amount actually paid for, or allocated to, the
purchase, development, construction or improvement of an Investment or, in the case of an
originated Loan, the principal amount of such Loan, exclusive, in each case, of Acquisition Fees
and Acquisition Expenses.

     “Contract Sales Price.” The total consideration received by CPA: 17 for the sale of a
Property.

     “CPA: 17.” Corporate Property Associates 17 — Global Incorporated together with its
consolidated subsidiaries, including the Operating Partnership, unless in the context of a
particular reference, it is clear that such reference refers to Corporate Property Associates 17 —
Global Incorporated excluding its consolidated subsidiaries. Unless the context otherwise
requires, any reference to financial measures of CPA: 17 shall be calculated by reference to the
consolidated financial statements of CPA: 17 and its subsidiaries, including, without limitation,
the Operating Partnership, prepared in accordance with GAAP.

     “Cumulative Return.” For the period for which the calculation is being made, the
percentage resulting from dividing (A) the total Distributions for such period (not including
Distributions out of Cash from Sales and Financings), by (B) the product of (i) either (x) until
such time as CPA: 17 has invested 90% of the net proceeds of CPA: 17’s initial Offering (excluding
net proceeds from the sale of Shares pursuant to CPA: 17’s distribution reinvestment program), the
average Adjusted Investor Capital for such period (calculated on a daily basis) or (y) from and
after such time as CPA: 17 has invested 90% of the net proceeds of CPA: 17’s initial Offering
(excluding net proceeds from the sale of Shares pursuant to CPA: 17’s distribution reinvestment
program), the net proceeds from the sale of Shares (excluding net proceeds from the sale of Shares
pursuant to CPA: 17’s distribution reinvestment program), as adjusted for Redemptions other than
Redemptions intended to qualify as a liquidity event for purposes of this Agreement, and by any
other Distributions on or prior to such date determined by the Board to be from Cash from Sales and
Financings, and (ii) the number of years (including fractions thereof) elapsed during such period.
Notwithstanding the foregoing, neither the Shares received by the Advisor or its Affiliates for any
consideration other than cash, nor the Distributions in respect of such Shares, shall be included
in the foregoing calculation.

     “Development Fee.” A fee for the packaging of a Property including negotiating and
approving plans, and undertaking to assist in obtaining zoning and necessary variances and
necessary financing for the specific Property, either initially or at a later date.

     “Directors.” The persons holding such office, as of any particular time, under the
Articles of Incorporation, whether they be the directors named therein or additional or successor
directors.

     “Distributions.” Distributions declared by the Board.

     “GAAP.” Generally accepted accounting principles in the United States.

     “Good Reason.” With respect to the termination of this Agreement, (i) any failure to
obtain a satisfactory agreement from any successor to CPA: 17 or the Operating Partnership to
assume and agree to perform CPA: 17’s or the Operating Partnership’s, as applicable, obligations
under this Agreement; or (ii) any material breach of this Agreement of any nature whatsoever by
CPA: 17 or the Operating Partnership; provided that (a) such breach is of a material term or
condition of this Agreement and

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(b)
CPA: 17 or the Operating Partnership, as applicable, has not cured such breach within 30 days
of written notice thereof or, in the case of any breach that cannot be cured within 30 days by
reasonable effort, has not taken all necessary action within a reasonable time period to cure such
breach.

     “Gross Offering Proceeds.” The aggregate purchase price of Shares sold in any
Offering.

     “Independent Appraiser.” A qualified appraiser of real estate as determined by the
Board, who is not affiliated, directly or indirectly, with CPA: 17, the Advisor or their respective
Affiliates. Membership in a nationally recognized appraisal society such as the American Institute
of Real Estate Appraisers or the Society of Real Estate Appraisers shall be conclusive evidence of
such qualification.

     “Independent Director.” A Director of CPA: 17 who meets the criteria for an
Independent Director specified in the Bylaws.

     “Individual.” Any natural person and those organizations treated as natural persons
in Section 542(a) of the Code.

     “Initial Acquisition Fee.” Any fee or commission (including any interest thereon)
paid by the Operating Partnership to the Advisor or, with respect to Section 9(d) or 9(f), by the
Operating Partnership to any party, in connection with the making of an Investment or the
development or construction of Properties by CPA: 17. A Development Fee or a Construction Fee paid
to a Person not affiliated with the Sponsor in connection with the actual development or
construction of a project after acquisition of the Property by CPA: 17 shall not be deemed an
Initial Acquisition Fee. Initial Acquisition Fees include, but are not limited to, any real estate
commission, selection fee, development fee or construction fee (other than as described above),
non-recurring management fees, loan fees, points or any fee of a similar nature, however
designated. Initial Acquisition Fees include Subordinated Acquisition Fees unless the context
otherwise requires. Initial Acquisition Fees shall not include Acquisition Expenses.

     “Initial Investor Capital.” The total amount of capital invested from time to time by
Shareholders (computed at the Original Issue Price per Share), excluding any Shares received by the
Advisor or its Affiliates for any consideration other than cash.

     “Investment.” means an investment made by CPA: 17, directly or indirectly, in a
Property, Loan or Other Permitted Investment Asset.

     “Loans.” The notes and other evidences of indebtedness or obligations acquired,
originated or entered into, directly or indirectly, by CPA: 17 as lender, noteholder, participant,
note purchaser or other capacity, including but not limited to first or subordinate mortgage loans,
construction loans, development loans, loan participations, B notes, loans secured by capital stock
or any other assets or form of equity interest and any other type of loan or financial arrangement,
such as providing or arranging for letters of credit, providing guarantees of obligations to third
parties, or providing commitments for loans. The term “Loans” shall not include leases which are
not recognized as leases for Federal income tax reporting purposes.

     “Loan Refinancing Fee.” A fee payable to the Advisor in respect of the refinancing of
a loan secured by an Investment.

     “Long-Term Net Leased Property.” A Property subject to a Net Lease which has a
remaining lease term of at least seven years (or is otherwise subject to terms the effect of which
is that there is a reasonable likelihood that the lease will have a remaining term of at least
seven years as a result of the

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exercise of options or otherwise) at the date such Property is acquired or developed by CPA:
17, including Net Leased Properties accounted for under the equity method of accounting.

     “Market Value.” The value calculated by multiplying the total number of outstanding
Shares by the average closing price of the Shares over the 30 trading days beginning 180 calendar
days after the Shares are first listed on a national security exchange or included for quotation on
Nasdaq, as the case may be.

     “Nasdaq.” The national automated quotation system operated by the National
Association of Securities Dealers, Inc.

     “Net Lease.” A lease pursuant to which the tenant is required to pay substantially
all of the costs associated with operating and maintaining the Property.

     “Offering.” The offering of Shares pursuant to a Prospectus.

     “Operating Expenses.” All consolidated operating, general and administrative expenses
paid or incurred by CPA: 17, as determined under GAAP, except the following (insofar as they would
otherwise be considered operating, general and administrative expenses under GAAP): (i) interest
and discounts and other cost of borrowed money; (ii) taxes (including state, Federal and foreign
income tax, property taxes and assessments, franchise taxes and taxes of any other nature); (iii)
expenses of raising capital, including Organization and Offering Expenses, printing, engraving, and
other expenses, and taxes incurred in connection with the issuance and distribution of CPA: 17’s
Shares and Securities; (iv) Acquisition Expenses, real estate commissions on resale of property and
other expenses connected with the acquisition, disposition, origination, ownership and operation of
Investments, including the costs of foreclosure, insurance premiums, legal services, brokerage and
sales commissions, and the maintenance, repair and improvement of property; (v) Acquisition Fees or
Subordinated Disposition Fees payable to the Advisor or any other party; (vi) distributions paid by
the Operating Partnership to the Special General Partner under the agreement of limited partnership
of the Operating Partnership in respect of gains realized on dispositions of Investments; (vii)
amounts paid to effect a redemption or repurchase of the special general partner interest held by
the Special General Partner pursuant to the agreement of limited partnership of the Operating
Partnership; and (viii) non-cash items, such as depreciation, amortization, depletion, and
additions to reserves for depreciation, amortization, depletion, losses and bad debts.
Notwithstanding anything herein to the contrary, Operating Expenses shall include the Asset
Management Fee and any Loan Refinancing Fee and, solely for the purposes of determining compliance
with the 2%/25% Guidelines, distributions of profits and cash flow made by the Operating
Partnership to the Special General Partner pursuant to the agreement of limited partnership of the
Operating Partnership, other than distributions described in clauses (vi) and (vii) of this
definition.

     “Operating Partnership.” CPA: 17 Limited Partnership, a Delaware limited partnership.

     “Organization and Offering Expenses.” Those expenses payable by CPA: 17 and the
Operating Partnership in connection with the formation, qualification and registration of CPA: 17
and in marketing and distributing Shares, including, but not limited to: (i) the preparation,
printing, filing and delivery of any registration statement or Prospectus and the preparing and
printing of contractual agreements among CPA: 17, the Operating Partnership and the Sales Agent and
the Selected Dealers (including copies thereof); (ii) the preparing and printing of the Articles of
Incorporation and Bylaws, solicitation material and related documents and the filing and/or
recording of such documents necessary to comply with the laws of the State of Maryland for the
formation of a corporation and thereafter for the continued good standing of a corporation; (iii)
the qualification or registration of the Shares under state securities or “Blue Sky” laws; (iv) any
escrow arrangements, including any compensation to an escrow agent; (v) the filing

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fees payable to the SEC and to the National Association of Securities Dealers, Inc.; (vi)
reimbursement for the reasonable and identifiable out-of-pocket expenses of the Sales Agent and the
Selected Dealers, including the cost of their counsel; (vii) the fees of CPA: 17’s counsel; (viii)
all advertising expenses incurred in connection with an Offering, including the cost of all sales
literature and the costs related to investor and broker-dealer sales and information meetings and
marketing incentive programs; and (ix) selling commissions, selected dealer fees, marketing fees,
incentive fees, due diligence fees and wholesaling fees incurred in connection with the sale of the
Shares.

     “Original Issue Price.” For any Share issued in an Offering, the price at which such
Share was initially offered to the public by CPA: 17, regardless of whether selling commissions
were paid in connection with the purchase of such Share from CPA: 17.

     “Other Permitted Investment Asset.” An asset, other than cash, cash equivalents,
short term bonds, auction rate securities and similar short term investments, acquired by CPA: 17
for investment purposes that is not a Loan or a Property and is consistent with the investment
objectives and policies of CPA: 17.

     “Person.” An Individual, corporation, partnership, joint venture, association,
company, trust, bank, or other entity, or government or any agency or political subdivision of a
government.

     “Preferred Return.” A Cumulative Return of five percent computed from the Closing
Date through the date as of which such amount is being calculated.

     “Property or Properties.” CPA: 17’s partial or entire interest in real property
(including leasehold interests) and personal or mixed property connected therewith. An Investment
which obligates CPA: 17 to acquire a Property will be treated as a Property for purposes of this
Agreement.

     “Property Management Fee.” A fee for property management services rendered by the
Advisor or its Affiliates in connection with Properties acquired directly or through foreclosure.

     “Prospectus.” Any prospectus pursuant to which CPA: 17 offers Shares in a public
offering, as the same may at any time and from time to time be amended or supplemented after the
effective date of the registration statement in which it is included.

     “Redemptions.” An amount determined by multiplying the number of Shares redeemed by
the Original Issue Price.

     “REIT.” A real estate investment trust, as defined in Sections 856-860 of the Code.

     “Sales Agent.” Carey Financial Corporation.

     “Securities.” Any stock, shares (other than currently outstanding Shares and
subsequently issued Shares), voting trust certificates, bonds, debentures, notes or other evidences
of indebtedness, secured or unsecured, convertible, subordinated or otherwise or in general any
instruments commonly known as “securities” or any certificate of interest, shares or participation
in temporary or interim certificates for receipts (or, guarantees of, or warrants, options or
rights to subscribe to, purchase or acquire any of the foregoing), which subsequently may be issued
by CPA: 17.

     “Selected Dealers.” Broker-dealers who are members of the National Association of
Securities Dealers, Inc. and who have executed an agreement with the Sales Agent in which the
Selected Dealers agree to participate with the Sales Agent in the Offering.

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     “Shareholders.” Those Persons who, at the time any calculation hereunder is to be
made, are shown as holders of record of Shares on the books and records of CPA: 17.

     “Share Market Value.” The value calculated by multiplying the total number of
outstanding Shares by the average closing price of the Shares over the 30 trading days beginning
180 calendar days after the Shares are first listed on a national security exchange or included for
quotation on Nasdaq, as the case may be.

     “Shares.” All of the shares of common stock of CPA: 17, $.001 par value, and any
other shares of common stock of CPA: 17.

     “Special General Partner.” W. P. Carey Holdings, LLC and any permitted transferee of
the special general partnership interest under the agreement of limited partnership of the
Operating Partnership.

     “Sponsor.” W.P. Carey & Co. LLC and any other Person directly or indirectly
instrumental in organizing, wholly or in part, CPA: 17 or any person who will control, manage or
participate in the management of CPA: 17, and any Affiliate of any such person. Sponsor does not
include a person whose only relationship to CPA: 17 is that of an independent property manager and
whose only compensation is as such. Sponsor also does not include wholly independent third parties
such as attorneys, accountants and underwriters whose only compensation is for professional
services.

     “Subordinated Acquisition Fee.” The Subordinated Acquisition Fee as defined in
Section 9(c) hereof.

     “Subordinated Disposition Fee.” The Subordinated Disposition Fee as defined in
Section 9(f) hereof.

     “Termination Date.” The effective date of any termination of this Agreement.

     “Total Investment Cost.” With regard to any Investment, an amount equal to the sum of
the Contract Purchase Price of such Investment plus the Acquisition Fees and Acquisition Expenses
paid in connection with such Investment.

     “Triggering Event.” With regard to any Investment, the occurrence of any of the
following during the six months after the closing date of the Investment: (a) the failure by an
obligor on an Investment to pay rent, interest or principal, or other material payment, to the
Company when due (after giving effect to all applicable grace periods) or (b) the obligor on an
Investment (including a guarantor) (1) commences a voluntary case or proceeding under applicable
bankruptcy or reorganization law, (2) consents to the entry of a decree or order for relief in an
involuntary proceeding under applicable bankruptcy law, (3) consents to the filing of a petition or
the appointment of a custodian, receiver or liquidator, (4) makes an assignment for the benefit of
creditors, (5) admits in writing its inability to pay its debts as they come due; (6) is the
subject of a decree or order for relief entered by a court of competent jurisdiction in respect of
such obligor in an involuntary bankruptcy case or proceeding, or a decree or order adjudging such
obligor bankrupt or insolvent or appointing a custodian, receiver or liquidator for the obligor.

     2. Appointment. CPA: 17 hereby appoints the Advisor to serve as its advisor on the
terms and conditions set forth in this Agreement, and the Advisor hereby accepts such appointment.

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     3. Duties of the Advisor. The Advisor undertakes to use its best efforts to present
to CPA: 17 potential investment opportunities and to provide a continuing and suitable investment
program consistent with the investment objectives and policies of CPA: 17 as determined and adopted
from time to time by the Board. In performance of this undertaking, subject to the supervision of
the Board and consistent with the provisions of the Articles of Incorporation and Bylaws of CPA: 17
and any Prospectus pursuant to which Shares are offered, the Advisor shall, either directly or by
engaging an Affiliate:

     (a) serve as CPA: 17’s investment and financial advisor and provide research and
economic and statistical data in connection with CPA: 17’s assets and investment policies;

     (b) provide the daily management of CPA: 17 and perform and supervise the various
administrative functions reasonably necessary for the management of CPA: 17;

     (c) investigate, select, and, on behalf of CPA: 17, engage and conduct business with
such Persons as the Advisor deems necessary to the proper performance of its obligations
hereunder, including but not limited to consultants, accountants, correspondents, lenders,
technical advisors, attorneys, brokers, underwriters, corporate fiduciaries, escrow agents,
depositaries, custodians, agents for collection, insurers, insurance agents, banks,
builders, developers, property owners, mortgagors, and any and all agents for any of the
foregoing, including Affiliates of the Advisor, and Persons acting in any other capacity
deemed by the Advisor necessary or desirable for the performance of any of the foregoing
services, including but not limited to entering into contracts in the name of CPA: 17 with
any of the foregoing;

     (d) consult with Directors of CPA: 17 and assist the Board in the formulation and
implementation of CPA: 17’s policies, and furnish the Board with such information, advice
and recommendations as they may request or as otherwise may be necessary to enable them to
discharge their fiduciary duties with respect to matters coming before the Board;

     (e) subject to the provisions of Sections 3(g) and 4 hereof: (1) locate, analyze and
select potential Investments; (2) structure and negotiate the terms and conditions of
transactions pursuant to which Investments will be made, purchased or acquired by CPA: 17;
(3) make Investments on behalf of CPA: 17; (4) arrange for financing and refinancing of,
make other changes in the asset or capital structure of, dispose of, reinvest the proceeds
from the sale of, or otherwise deal with the Investments; and (5) enter into leases and
service contracts for Properties and, to the extent necessary, perform all other operational
functions for the maintenance and administration of such Properties;

     (f) provide the Board with periodic reports regarding prospective Investments and with
periodic reports, no less than quarterly, of (1) new Investments made during the prior
fiscal quarter, which reports shall include information regarding the type of each
Investment made (in the categories provided in Section 9); (2) the occurrence of any
Triggering Event during the prior fiscal quarter; and (3) the amounts of “dead deal” costs
incurred by the Company during the prior fiscal quarter;

     (g) obtain the prior approval of the Board (including a majority of the Independent
Directors) for any and all investments in Property which do not meet all of the requirements
set forth in Section 4(b) hereof;

     (h) negotiate on behalf of CPA: 17 with banks or lenders for loans to be made to CPA:
17, and negotiate on behalf of CPA: 17 with investment banking firms and broker-dealers or
negotiate private sales of Shares and Securities or obtain loans for CPA: 17, but in no
event in

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such a way so that the Advisor shall be acting as broker-dealer or underwriter; and
provided, further, that any fees and costs payable to third parties incurred by the Advisor
in connection with the foregoing shall be the responsibility of CPA: 17;

     (i) obtain reports (which may be prepared by the Advisor or its Affiliates), where
appropriate, concerning the value of Investments or contemplated Investments;

     (j) obtain for, or provide to, CPA: 17 such services as may be required in acquiring,
managing and disposing of Investments, including, but not limited to: (i) the negotiation,
making and servicing of Investments; (ii) the disbursement and collection of Company monies;
(iii) the payment of debts of and fulfillment of the obligations of CPA: 17; and (iv) the
handling, prosecuting and settling of any claims of or against CPA: 17, including, but not
limited to, foreclosing and otherwise enforcing mortgages and other liens securing Loans;

     (k) from time to time, or at any time reasonably requested by the Board, make reports
to the Board of its performance of services to CPA: 17 under this Agreement;

     (l) communicate on behalf of CPA: 17 with Shareholders as required to satisfy the
reporting and other requirements of any governmental bodies or agencies to Shareholders and
third parties and otherwise as requested by CPA: 17;

     (m) provide or arrange for administrative services and items, legal and other services,
office space, office furnishings, personnel and other overhead items necessary and
incidental to CPA: 17’s business and operations;

     (n) provide CPA: 17 with such accounting data and any other information requested by
CPA: 17 concerning the investment activities of CPA: 17 as shall be required to prepare and
to file all periodic financial reports and returns required to be filed with the Securities
and Exchange Commission and any other regulatory agency, including annual financial
statements;

     (o) maintain the books and records of CPA: 17;

     (p) supervise the performance of such ministerial and administrative functions as may
be necessary in connection with the daily operations of the Investments;

     (q) provide CPA: 17 with all necessary cash management services;

     (r) do all things necessary to assure its ability to render the services described in
this Agreement;

     (s) perform such other services as may be required from time to time for management and
other activities relating to the assets of CPA: 17 as the Advisor shall deem advisable under
the particular circumstances;

     (t) arrange to obtain on behalf of CPA: 17 as requested by the Board, and deliver to or
maintain on behalf of CPA: 17 copies of, all appraisals obtained in connection with
investments in Properties and Loans;

     (u) if a transaction, proposed transaction or other matter requires approval by the
Board or by the Independent Directors, deliver to the Board or the Independent Directors, as
the case

10

 

may be, all documentation reasonably requested by them to properly evaluate such
transaction, proposed transaction or other matter; and

     (v) on an annual basis, no later than 90 days prior to the end of each term of this
Agreement, provide the Independent Directors with a report on (1) the Advisor’s performance
during the past year, (2) the compensation paid to the Advisor during such year and (3) any
proposed changes to the compensation to be paid to the Advisor during the upcoming year if
the Agreement is renewed. The Advisor’s report shall address, among other things, (a) those
matters identified in the Company’s organizational documents as matters which the
Independent Directors must review each year with respect to the Advisor’s performance and
compensation; (b) whether any Triggering Event occurred with respect to an Investment made
during the past year; and (c) the “dead deal” costs incurred by the Company during the past
year. If a Triggering Event has occurred, the Independent Directors may consider whether,
after taking account of the overall performance of the Advisor during the past year, they
wish to request that the Advisor refund all or a portion of the Initial Acquisition Fee paid
by the Company in respect of such Investment, and if the Independent Directors make that
request, the Advisor shall refund such amount to the Company within 60 days after receipt of
such request. In addition, the Independent Directors may request that the Advisor refund
certain of the dead deal costs incurred by the Company if, in light of the circumstances
under which such costs were incurred, the Independent Directors determine that the Company
should not bear such costs.

     4. Authority of Advisor.

     (a) Pursuant to the terms of this Agreement (and subject to the restrictions included
in Paragraphs (b), (c) and (d) of this Section 4 and in Section 7 hereof), and subject to
the continuing and exclusive authority of the Board over the management of CPA: 17, the
Board hereby delegates to the Advisor the authority to: (1) locate, analyze and select
Investment opportunities; (2) structure the terms and conditions of transactions pursuant to
which Investments will be made or acquired for CPA: 17; (3) make or acquire Investments in
compliance with the investment objectives and policies of CPA: 17; (4) arrange for financing
or refinancing, or make changes in the asset or capital structure of, and dispose of or
otherwise deal with, Investments; (5) enter into leases and service contracts for
Properties, and perform other property level operations; (6) oversee non-affiliated property
managers and other non-affiliated Persons who perform services for CPA: 17; and (7)
undertake accounting and other record-keeping functions at the Investment level.

     (b) The consideration paid for an Investment acquired by CPA: 17 shall ordinarily be
based on the fair market value thereof. Consistent with the foregoing provision, the
Advisor may, without further approval by the Board (except with respect to transactions
subject to paragraphs (c) and (d)) invest on behalf of CPA: 17 in an Investment so long as,
in the Advisor’s good faith judgment, (i) the Total Investment Cost of such Investment does
not exceed the fair market value thereof, and in the case of an Investment that is a
Property, shall in no event exceed the Appraised Value of such Property and (ii) the
Investment, in conjunction with CPA: 17’s other investments and proposed investments, at the
time CPA: 17 is committed to purchase or originate the Investment, is reasonably expected to
fulfill CPA: 17’s investment objectives and policies as established by the Board and then in
effect. For purposes of the foregoing, Total Investment Cost shall be measured at the date
the Investment is made and shall exclude future commitments to fund improvements.
Investments not meeting the foregoing criteria must be approved in advance by the Board.

11

 

     (c) Notwithstanding anything to the contrary contained in this Agreement, the Advisor
shall not cause CPA: 17 to make Investments that do not comply with Article VIII
(Restrictions on Investments and Activities) and related sections of the Bylaws.

     (d) The prior approval of the Board, including a majority of the Independent Directors
and a majority of the Directors not interested in the transaction, will be required for:
(i) Investments made through co-investment or joint venture arrangements with the Sponsor,
the Advisor or any of their Affiliates; (ii) Investments which are not contemplated by the
terms of a Prospectus; (iii) transactions that present issues which involve conflicts of
interest for the Advisor or an Affiliate (other than conflicts involving the payment of fees
or the reimbursement of expenses); (iv) the lease of assets to the Sponsor, any Director,
the Advisor or any Affiliate of the Advisor; (v) any purchase or sale of an Investment from
or to the Advisor or an Affiliate; and (vi) the retention of any Affiliate of the Advisor to
provide services to CPA: 17 not expressly contemplated by this Agreement and the terms of
such services by such Affiliate. In addition, the Advisor shall comply with any further
approval requirements set forth in the Bylaws.

     (e) The Board may, at any time upon the giving of notice to the Advisor, modify or
revoke the authority set forth in this Section 4. If and to the extent the Board so
modifies or revokes the authority contained herein, the Advisor shall henceforth comply with
such modification or revocation, provided however, that such modification or revocation
shall be effective upon receipt by the Advisor and shall not be applicable to investment
transactions to which the Advisor has committed CPA: 17 prior to the date of receipt by the
Advisor of such notification.

     5. Bank Accounts. The Advisor may establish and maintain one or more bank accounts in
its own name for the account of CPA: 17 or in the name of CPA: 17 and may collect and deposit into
any such account or accounts, and disburse from any such account or accounts, any money on behalf
of CPA: 17, provided that no funds shall be commingled with the funds of the Advisor; and the
Advisor shall from time to time render appropriate accountings of such collections and payments to
the Board and to the auditors of CPA: 17.

     6. Records; Access. The Advisor shall maintain appropriate records of all its
activities hereunder and make such records available for inspection by the Board and by counsel,
auditors and authorized agents of CPA: 17, at any time or from time to time during normal business
hours. The Advisor shall at all reasonable times have access to the books and records of CPA: 17.

     7. Limitations on Activities. Anything else in this Agreement to the contrary
notwithstanding, the Advisor shall refrain from taking any action which, in its sole judgment made
in good faith, would adversely affect the status of CPA: 17 as a REIT or of the Operating
Partnership as a partnership for Federal income tax purposes, subject CPA: 17 or the Operating
Partnership to regulation under the Investment Company Act of 1940, would violate any law, rule,
regulation or statement of policy of any governmental body or agency having jurisdiction over CPA:
17, its Shares or its Securities, or otherwise not be permitted by the Articles of Incorporation or
Bylaws or agreement of limited partnership of the Operating Partnership, except if such action
shall be ordered by the Board, in which case the Advisor shall notify promptly the Board of the
Advisor’s judgment of the potential impact of such action and shall refrain from taking such action
until it receives further clarification or instructions from the Board. In such event the Advisor
shall have no liability for acting in accordance with the specific instructions of the Board so
given.

     (a) Notwithstanding the foregoing, the Advisor, its shareholders, directors, officers
and employees, and partners, shareholders, directors and officers of the Advisor’s
shareholders

12

 

and Affiliates of any of them, shall not be liable to CPA: 17, the Operating
Partnership or to the Directors or Shareholders for any act or omission by the Advisor, its
shareholders, directors, officers and employees, or partners, shareholders, directors or
officers of the Advisor’s shareholders and Affiliates of any of them if the following
conditions are met:

     (i) The Advisor, its shareholders, directors, officers and employees, and
partners, shareholders, directors and officers of the Advisor’s shareholders and
Affiliates of any of them have determined, in good faith, that the course of conduct
which caused the loss or liability was in the best interests of CPA: 17;

     (ii) The Advisor, its shareholders, directors, officers and employees, and
partners, shareholders, directors and officers of the Advisor’s shareholders and
Affiliates of any of them were acting on behalf of or performing services for CPA:
17; and

     (iii) Such liability or loss was not the result of negligence or misconduct by
the Advisor, its shareholders, directors, officers and employees, and partners,
shareholders, directors and officers of the Advisor’s shareholders or Affiliates of
any of them.

     (b) Notwithstanding the foregoing, the Advisor and its Affiliates shall not be
indemnified by CPA: 17 or the Operating Partnership for any losses, liabilities or expenses
arising from or out of the alleged violation of federal or state securities laws unless one
or more of the following conditions are met:

     (i) There has been a successful adjudication on the merits of each count
involving alleged securities law violations as to the particular indemnitee;

     (ii) Such claims have been dismissed with prejudice on the merits by a court of
competent jurisdiction as to the particular indemnitee; or

     (iii) A court of competent jurisdiction approves a settlement of the claims
against a particular indemnitee and finds that indemnification of the settlement and
the related costs should be made, and the court considering the request for
indemnification has been advised of the position of the Securities and Exchange
Commission and of the published position of any state securities regulatory
authority in which securities of CPA: 17 were offered or sold as to indemnification
for violation of securities laws.

     (c) CPA: 17 and the Operating Partnership shall advance funds to the Advisor or its
Affiliates for legal expenses and other costs incurred as a result of any legal action for
which indemnification is being sought only if all of the following conditions are satisfied:

     (i) The legal action relates to acts or omissions with respect to the
performance of duties or services on behalf of CPA: 17;

     (ii) The legal action is initiated by a third party who is not a Shareholder or
the legal action is initiated by a Shareholder acting in his or her capacity as such
and a court of competent jurisdiction specifically approves such advancement; and

13

 

     (iii) The Advisor or the Affiliate undertakes to repay the advanced funds to
CPA: 17, together with the applicable legal rate of interest thereon, in cases in
which such Advisor or Affiliate is found not to be entitled to indemnification.

     (d) Notwithstanding the foregoing, the Advisor shall not be entitled to indemnification
or be held harmless pursuant to this Section 7 for any activity which the Advisor shall be
required to indemnify or hold harmless CPA: 17 pursuant to Section 22.

     (e) Any amounts paid pursuant to this Section 7 shall be recoverable or paid only out
the net assets of CPA: 17 and not from Shareholders.

     8. Relationship with Directors. There shall be no limitation on any shareholder,
director, officer, employee or Affiliate of the Advisor serving as a Director or an officer of CPA:
17, except that no employee of the Advisor or its Affiliates who also is a Director or officer of
CPA: 17 shall receive any compensation from CPA: 17 for serving as a Director or officer other than
for reasonable reimbursement for travel and related expenses incurred in attending meetings of the
Board; for the avoidance of doubt, the limitations of this Section 8 shall not apply to any
compensation paid by the Advisor or any Affiliate for which CPA: 17 reimbursed the Advisor or
Affiliate in accordance with Section 10 hereof.

     9. Fees.

     (a) Asset Management Fee. (i) The Operating Partnership shall pay to the
Advisor as compensation for the advisory services rendered hereunder an asset management fee
(the “Asset Management Fee”) in an amount equal to the percentage of the Average
Equity Market Value of an Investment as specified in the following table:

	 	 	 
	Type of Investment	 	Asset Management Fee
	Long-Term Net Leased Properties

	 	0.50% of the Average Market Value
	 
	 	 
	B Notes, mortgage backed securities and
Loans

	 	1.75% of the Average Equity Value
	 
	 	 
	Investments in readily marketable real
estate securities (other than B Notes,
mortgage backed securities and Loans)
purchased on the secondary market

	 	1.50% of the Average Equity Value
	 
	 	 
	All other Investments not described in
the foregoing categories, such as
interests in entities that own real
estate or are engaged in real estate
related businesses, short-term net
leases and equity investments in real
property

	 	0.50% of the Average Market Value

     (ii) The Asset Management Fee with respect to an Investment will be calculated
monthly, beginning with the month in which CPA: 17 first makes the Investment, and
shall be pro rated for the number of days during a month that CPA: 17 owns the
Investment. The aggregate Asset Management Fees calculated with respect to each
month shall be payable on the first business day following such month.

14

 

     (b) Initial Acquisition Fee. (i) The Advisor may receive as partial
compensation for services rendered in connection with the investigation, selection,
acquisition or origination (by purchase, investment or exchange) of any Investment, an
initial acquisition fee (an “Initial Acquisition Fee”) payable by the Operating
Partnership. The Initial Acquisition Fee payable to the Advisor in respect of an Investment
shall be payable at the time such Investment is acquired in an amount determined as
specified in the following table:

	 	 	 
	Type of Investment	 	Initial Acquisition Fee
	Long term Net Leased Properties

	 	2.5% of the aggregate Total Investment Cost
	 
	 	 
	B Notes, mortgage backed
securities and Loans

	 	1.0% of the sum of (x) the Average Equity
Value, plus (y) the Acquisition Fees paid
by CPA: 17 in respect of the Investment.
	 
	 	 
	Investments in readily
marketable real estate
securities (other than B
notes, mortgage backed
securities and Loans)
purchased on the secondary
market

	 	None
	 
	 	 
	All other Investments not
described in the foregoing
categories, such as interests
in entities that own real
estate or are engaged in real
estate related businesses,
short term net leases and
equity investments in real
property

	 	1.75% of the sum of (x) the equity capital
invested by CPA: 17 in the Investment plus
(y) the Acquisition Fees paid by CPA: 17
in respect of the Investment.

     (ii) At the time an Investment is made, the Advisor shall determine the type of
Investment, which shall be used for the purpose of calculating all fees due
hereunder; it being understood that the Advisor shall use its reasonable judgment,
based primarily upon the economic substance of an Investment, in determining the
classification of an Investment, provided, that in the event of any dispute, the
Independent Directors shall finally determine for all purposes the type of
Investment.

     (c) Subordinated Acquisition Fee. (i) In addition to the Initial Acquisition
Fee described in Section 9(b) above, the Advisor may receive additional compensation in
connection with the investigation, selection, acquisition or origination (by purchase,
investment or exchange) of Investments a Subordinated Acquisition Fee payable by the
Operating Partnership to the Advisor or its Affiliates (the “Subordinated Acquisition
Fee”). The total Subordinated Acquisition Fees payable shall be an amount determined as
specified in the following table:

	 	 	 
	Type of Investment	 	Subordinated Acquisition Fee
	Long term Net Leased Properties

	 	2.0% of the aggregate Total Investment Cost.
	 
	 	 
	All other Investments not
described in the foregoing
category

	 	None

     (ii) The Subordinated Acquisition Fee shall be payable in three equal annual
installments on the first business day of the fiscal quarter immediately following
the fiscal quarter in which the Investment is made and the first business day of the

15

 

corresponding fiscal quarter in each of the subsequent two fiscal years. The
unpaid portion of the Subordinated Acquisition Fee with respect to any Investment
will bear interest at the rate of 5% per annum from the date of acquisition of the
Investment until the portion of the Subordinated Acquisition Fee is paid. The
accrued interest is payable on the date of each annual installment of the fees. The
Subordinated Acquisition Fee payable in any year, and accrued interest thereon, will
be subordinated to the Preferred Return of 5% and only paid if the Preferred Return
of 5% has been achieved through the end of the prior fiscal quarter. Any portion of
the Subordinated Acquisition Fee, and accrued interest thereon, not paid due to CPA:
17’s failure to meet the Preferred Return of 5% through any fiscal quarter end shall
be paid by CPA: 17 on the first business day of the fiscal quarter next following
the fiscal quarter end through which the Preferred Return of 5% has been met.

     (d) Six Percent Limitation. The total amount of all Initial Acquisition Fees
plus Subordinated Acquisition Fees, including interest thereon, whether payable to the
Advisor or a third party, and Acquisition Expenses payable by the Operating Partnership may
not exceed 6% of the aggregate Contract Purchase Price of all Investments, measured for the
period beginning with the initial acquisition of an Investment and ending (i) on December 31
of the year in which CPA: 17 has invested 90% of the net proceeds of its initial Offering
(excluding the net proceeds from the sale of Shares pursuant to CPA: 17’s dividend
reinvestment program), and (ii) on each December 31 thereafter, unless a majority of the
Directors (including a majority of the Independent Directors) not otherwise interested in
any transaction approves the excess as being commercially competitive, fair and reasonable
to CPA: 17.

     (e) Property Management Fee; Loan Refinancing Fee. No Property Management Fee
or Loan Refinancing Fee shall be paid unless approved by a majority of the Independent
Directors.

     (f) Subordinated Disposition Fee. (i) If the Advisor or an Affiliate provides
a substantial amount of services in the sale of an Investment, the Advisor or such Affiliate
shall be entitled to receive a subordinated disposition fee (the “Subordinated
Disposition Fee”) at the time of such disposition, in an amount equal to the lesser of
(1) 50% of the Competitive Real Estate Commission (if applicable) and (2) 3.0% of the
Contract Sales Price of the Investment; provided, however, that (A) the Subordinated
Disposition Fee in respect of Investments that are B Notes, mortgage backed securities and
Loans shall equal 1.0% of the equity capital invested by CPA: 17 in the Investment, and (B)
no Subordinated Disposition Fee shall be paid in respect of Investments that are readily
marketable securities.

     (ii) The total real estate commissions and Subordinated Disposition Fees CPA:
17 pays to all Persons shall not exceed an amount equal to the lesser of: (1) 6% of
the Contract Sales Price of the Investment or (2) the Competitive Real Estate
Commission. Payment of Subordinated Disposition Fees and accrued interest thereon,
will be subordinated to the Preferred Return and only paid if the Preferred Return
of 5% has been achieved through the end of the prior fiscal quarter. To the extent
that Subordinated Disposition Fees are not paid on a current basis due to the
foregoing limitation, the unpaid fees will be due and paid at such time as the
limitation has been satisfied, together with interest from the time of disposition
of the Investment to which they relate, at the rate of 5%. The Advisor shall
present to the Independent Directors such information as they may reasonably request
to review the level of services provided by the Advisor in connection with a
disposition and the basis for the calculation of the amount of the Subordinated
Disposition Fees on a quarterly basis. No payment of

16

 

Subordinated Disposition Fees shall be made prior to review and approval of
such information by the Independent Directors.

     (g) Loans From Affiliates. CPA: 17 shall not borrow funds from the Advisor or
its Affiliates unless (A) the transaction is approved by a majority of the Independent
Directors and a majority of the Directors who are not interested in the transaction as being
fair, competitive and commercially reasonable, (B) the interest and other financing charges
or fees received by the Advisor or its Affiliates do not exceed the amount which would be
charged by non-affiliated lending institutions and (C) the terms are not less favorable than
those prevailing for comparable arm’s-length loans for the same purpose. CPA: 17 will not
borrow on a long-term basis from the Advisor or its Affiliates unless it is to provide the
debt portion of a particular investment and CPA: 17 is unable to obtain a permanent loan at
that time or in the judgment of the Board, it is not in CPA: 17’s best interest to obtain a
permanent loan at the interest rates then prevailing and the Board has reason to believe
that CPA: 17 will be able to obtain a permanent loan on or prior to the end of the loan term
provided by the Advisor or its Affiliates.

     (h) Changes To Fee Structure. In the event the Shares are listed on a national
securities exchange or are included for quotation on Nasdaq, CPA: 17 and the Advisor shall
negotiate in good faith to establish a fee structure appropriate for an entity with a
perpetual life. A majority of the Independent Directors must approve the new fee structure
negotiated with the Advisor. In negotiating a new fee structure, the Independent Directors
may consider any of the factors they deem relevant, including but not limited to: (a) the
size of the Advisory Fee in relation to the size, composition and profitability of CPA: 17’s
portfolio; (b) the success of the Advisor in generating opportunities that meet the
investment objectives of CPA: 17; (c) the rates charged to other REITs and to investors
other than REITs by Advisors performing similar services; (d) additional revenues realized
by the Advisor and its Affiliates through their relationship with CPA: 17, including loan
administration, underwriting or broker commissions, servicing, engineering, inspection and
other fees, whether paid by CPA: 17 or by others with whom CPA: 17 does business; (e) the
quality and extent of service and advice furnished by the Advisor; (f) the performance of
the investment portfolio of CPA: 17, including income, conservation or appreciation of
capital, frequency of problem investments and competence in dealing with distress
situations; and (g) the quality of the portfolio of CPA: 17 in relationship to the
investments generated by the Advisor for the account of other clients. The Independent
Directors shall not approve any new fee structure that is in their judgment more favorable
(taken as a whole) to the Advisor than the current fee structure.

     (i) Payment. Compensation payable to the Advisor pursuant to this Section 9
shall be paid in cash; provided, however, that any fee payable pursuant to Section 9 may be
paid, at the option of the Advisor, in the form of: (i) cash, (ii) restricted stock of CPA:
17, or (iii) a combination of cash and restricted stock. The Advisor shall notify CPA: 17
in writing annually of the form in which the fee shall be paid. Such notice shall be
provided no later than January 15 of each year. If no such notice is provided, the fee
shall be paid in cash. For purposes of the payment of compensation to the Advisor in the
form of stock, the value of each share of restricted stock shall be: (i) the Net Asset
Value per Share as determined based on the most recent appraisal of CPA: 17’s assets
performed by an Independent Appraiser, or (ii) if an appraisal has not yet been performed,
$10 per share. If shares are being offered to the public at the time a fee is paid with
stock, the value shall be the price of the stock without commissions. The Net Asset Value
determined on the basis of such appraisal may be adjusted on a quarterly or other basis by
the Board to account for significant capital transactions. Stock issued by CPA: 17 to the
Advisor in payment of fees hereunder shall be governed by the terms set forth in Schedule A
hereto, or such other terms as the Advisor and CPA: 17 may from time to time agree.

17

 

     10. Expenses.

     (a) Subject to the limitations set forth in Section 9(d), to the extent applicable, in
addition to the compensation paid to the Advisor pursuant to Section 9 hereof, the Operating
Partnership shall pay directly or reimburse the Advisor for the following expenses:

     (i) Organization and Offering Expenses; provided however, that within 60 days
after the end of the quarter in which any Offering terminates, the Advisor shall
reimburse the Operating Partnership for any Organization and Offering Expense
reimbursements received by the Advisor pursuant to this Section 10 to the extent
that such reimbursements, when added to the balance of the Organization and Offering
Expenses (excluding selling commissions, the selected dealer fee and the wholesaling
fee) paid directly by the Operating Partnership, exceed four percent of the Gross
Offering Proceeds; provided further, that the Advisor shall be responsible for the
payment of all Organization and Offering Expenses (excluding such commissions and
such fees and expense reimbursements) in excess of four percent of the Gross
Offering Proceeds;

     (ii) all Acquisition Expenses;

     (iii) to the extent not included in Acquisition Expenses, all expenses of
whatever nature reasonably incurred and directly connected with the proposed
acquisition of any Investment that does not result in the actual acquisition of the
Investment, including, without limitation, personnel costs;

     (iv) expenses other than Acquisition Expenses incurred in connection with the
investment of the funds of CPA: 17, including, without limitation, costs of
retaining industry or economic consultants and finder’s fees and similar payments,
to the extent not paid by the seller of the Investment or another third party,
regardless of whether such expenses were incurred in transactions where a fee is not
payable to the Advisor;

     (v) interest and other costs for borrowed money, including discounts, points
and other similar fees;

     (vi) taxes and assessments on income of CPA: 17, to the extent paid or advanced
by the Advisor, or on Investments and taxes as an expense of doing business;

     (vii) costs associated with insurance required in connection with the business
of CPA: 17 or by the Directors;

     (viii) expenses of managing and operating Investments owned by CPA: 17, whether
payable to an Affiliate of the Advisor or a non-affiliated Person;

     (ix) fees and expenses of legal counsel for CPA: 17;

     (x) fees and expense of auditors and accountants for CPA: 17;

     (xi) all expenses in connection with payments to the Directors and meetings of
the Directors and Shareholders;

     (xii) expenses associated with listing the Shares and Securities on a
securities exchange or Nasdaq if requested by the Board;

18

 

     (xiii) expenses connected with payments of Distributions in cash or otherwise
made or caused to be made by the Board to the Shareholders;

     (xiv) expenses of organizing, revising, amending, converting, modifying, or
terminating CPA: 17, the Operating Partnership or their respective governing
instruments;

     (xv) expenses of maintaining communications with Shareholders, including the
cost of preparation, printing and mailing annual reports and other Shareholder
reports, proxy statements and other reports required by governmental entities; and

     (xvi) all other expenses the Advisor incurs in connection with providing
services to CPA: 17, including reimbursement to the Advisor or its Affiliates for
the cost of rent, goods, materials and personnel incurred by them based upon the
compensation of the Persons involved and an appropriate share of overhead allocable
to those Persons as reasonably determined by the Advisor on a basis approved
annually by the Board (including a majority of the Independent Directors). No
reimbursement shall be made for the cost of personnel to the extent that such
personnel are used in transactions for which the Advisor receives a separate fee.

     (b) Expenses incurred by the Advisor on behalf of CPA: 17 and payable pursuant to this
Section 10 shall be reimbursed quarterly to the Advisor within 60 days after the end of each
quarter, subject to the provisions of Section 13 hereof. The Advisor shall prepare a
statement documenting the Operating Expenses of CPA: 17 within 45 days after the end of each
quarter.

     11. Other Services. Should the Board request that the Advisor or any Affiliate,
shareholder or employee thereof render services for CPA: 17 other than as set forth in Section 3
hereof, such services shall be separately compensated and shall not be deemed to be services
pursuant to the terms of this Agreement.

     12. Fidelity Bond. The Advisor shall maintain a fidelity bond for the benefit of CPA:
17 which bond shall insure CPA: 17 from losses of up to $5,000,000 and shall be of the type
customarily purchased by entities performing services similar to those provided to CPA: 17 by the
Advisor.

     13. Limitation on Expenses.

     (a) If Operating Expenses during the 12-month period ending on the last day of any
fiscal quarter of CPA: 17 exceed the greater of (i) two percent of the Average Invested
Assets during the same 12-month period or (ii) 25% of the Adjusted Net Income of CPA: 17
during the same 12-month period, then subject to paragraph (b) of this Section 13, such
excess amount shall be the sole responsibility of the Advisor and neither the Operating
Partnership nor CPA: 17 shall be liable for payment therefor. CPA: 17 may defer the payment
or distribution to the Advisor and the Special General Partner of fees, expenses and
distributions that would, if paid or distributed, cause Operating Expenses during such
12-month period to exceed the foregoing limitations; provided, however, that in determining
which items shall be paid and which may be deferred, priority will be given to the payment
of distributions to the Special General Partner over the payment to the Advisor of amounts
due under this Agreement.

     (b) Notwithstanding the foregoing, to the extent that the Advisor becomes responsible
for any excess amount as provided in paragraph (a), if a majority of the Independent
Directors finds such excess amount or a portion thereof justified based on such unusual and
non-recurring

19

 

factors as they deem sufficient, the Operating Partnership shall reimburse the Advisor
in future quarters for the full amount of such excess, or any portion thereof, but only to
the extent such reimbursement would not cause the Operating Expenses to exceed the 2%/25%
Guidelines in the 12-month period ending on the last day of such quarter. In no event shall
the Operating Expenses payable by the Operating Partnership in any 12-month period ending at
the end of a fiscal quarter exceed the 2%/25% Guidelines.

     (c) Within 60 days after the end of any twelve-month period referred to in paragraph
(a), the Advisor shall reimburse CPA: 17 for any amounts expended by CPA: 17 in such
twelve-month period that exceeds the limitations provided in paragraph (a) unless the
Independent Directors determine that such excess expenses are justified, as provided in
paragraph (b), and provided the Operating Expenses for such later quarter would not thereby
exceed the 2%/25% Guidelines.

     (d) All computations made under paragraphs (a) and (b) of this Section 13 shall be
determined in accordance with generally accepted accounting principles applied on a
consistent basis.

     (e) If the Special General Partner receives distributions pursuant to the agreement of
limited partnership of the Operating Partnership in respect of realized gains on the
disposition of an Investment, Adjusted Net Income, for purposes of calculating the Operating
Expenses, shall exclude the gain from the disposition of such Investment.

     14. Other Activities of the Advisor. Nothing herein contained shall prevent the
Advisor from engaging in other activities, including without limitation direct investment by the
Advisor and its Affiliates in assets that would be suitable for CPA: 17, the rendering of advice to
other investors (including other REITs) and the management of other programs advised, sponsored or
organized by the Advisor or its Affiliates; nor shall this Agreement limit or restrict the right of
the Advisor or any of its Affiliates or of any director, officer, employee or shareholder of the
Advisor or its Affiliates to engage in any other business or to render services of any kind to any
other partnership, corporation, firm, individual, trust or association. The Advisor may, with
respect to any investment in which CPA: 17 is a participant, also render advice and service to each
other participant therein. Without limiting the generality of the foregoing, CPA 17 acknowledges
that the Advisor provides or will provide services to other CPA REIT funds, whether now in
existence or formed hereafter, and that the Advisor and its Affiliates may invest for their own
account. The Advisor shall be responsible for promptly reporting to the Board the existence of any
actual or potential conflict of interest that arises that may affect its performance of its duties
under this Agreement. If the Sponsor, Advisor, Director or Affiliates thereof has or have
sponsored other investment programs with similar investment objectives which have investment funds
available at the same time as CPA: 17, it shall be the duty of the Advisor to adopt a reasonable
method by which properties are to be allocated to the competing investment entities and to use its
best efforts to apply such method fairly to CPA: 17.

     The Advisor shall be required to use its best efforts to present a continuing and suitable
investment program to CPA: 17 that is consistent with the investment policies and objectives of
CPA: 17, but subject to the last sentence of the preceding paragraph, neither the Advisor nor any
Affiliate of the Advisor shall be obligated generally to present any particular investment
opportunity to CPA: 17 even if the opportunity is of character which, if presented to CPA: 17,
could be taken by CPA: 17.

     If the Advisor or its Affiliates is presented with a potential investment which might be made
by CPA: 17 and by another investment entity which the Advisor or its Affiliates advises or manages,
the Advisor shall consider, among other things, the investment portfolio of each entity, cash flow
of each

20

 

entity, the effect of the acquisition on the diversification of each entity’s portfolio,
rental payments during any renewal period, the estimated income tax effects of the purchase on each
entity, the policies of each entity relating to leverage, the funds of each entity available for
investment, the amount of equity required to make the investment and the length of time such funds
have been available for investment.

     15. Relationship of Advisor and CPA: 17. CPA: 17 and the Advisor agree that they have
not created and do not intend to create by this Agreement a joint venture or partnership
relationship between them and nothing in this Agreement shall be construed to make them partners or
joint venturers or impose any liability as partners or joint venturers on either of them.

     16. Term; Termination of Agreement. This Agreement, as amended and restated, shall
continue in force until September 30, 2010 or until 60 days after the date on which the Independent
Directors shall have notified the Advisor of their determination either to renew this Agreement for
an additional one-year period or terminate this Agreement, as required by CPA:17’s Charter.

     17. Termination by CPA: 17. At the sole option the Board (including a majority of the
Independent Directors), this Agreement may be terminated immediately by written notice of
termination from CPA: 17 to the Advisor upon the occurrence of events which would constitute Cause
or if any of the following events occur:

     (a) If the Advisor shall breach this Agreement; provided that such breach (i) is of a
material term or condition of this Agreement and (ii) the Advisor has not cured such breach
within 30 days of written notice thereof or, in the case of any breach that cannot be cured
within 30 days by reasonable effort, has not taken all necessary action within a reasonable
time period to cure such breach;

     (b) If the Advisor shall be adjudged bankrupt or insolvent by a court of competent
jurisdiction, or an order shall be made by a court of competent jurisdiction for the
appointment of a receiver, liquidator, or trustee of the Advisor, for all or substantially
all of its property by reason of the foregoing, or if a court of competent jurisdiction
approves any petition filed against the Advisor for reorganization, and such adjudication or
order shall remain in force or unstayed for a period of 30 days; or

     (c) If the Advisor shall institute proceedings for voluntary bankruptcy or shall file a
petition seeking reorganization under the federal bankruptcy laws, or for relief under any
law for relief of debtors, or shall consent to the appointment of a receiver for itself or
for all or substantially all of its property, or shall make a general assignment for the
benefit of its creditors, or shall admit in writing its inability to pay its debts,
generally, as they become due.

     Any notice of termination under Section 16 or 17 shall be effective on the date specified in
such notice, which may be the day on which such notice is given or any date thereafter. The
Advisor agrees that if any of the events specified in Section 17(b) or (c) shall occur, it shall
give written notice thereof to the Board within 15 days after the occurrence of such event.

     18. Termination by Either Party. This Agreement may be terminated immediately without
penalty (but subject to the requirements of Section 20 hereof) by the Advisor by written notice of
termination to CPA: 17 upon the occurrence of events which would constitute Good Reason or by CPA:
17 without cause or penalty (but subject to the requirements of Section 20 hereof) by action of the
Directors, a majority of the Independent Directors or by action of a majority of the Shareholders,
in each case upon 60 days’ written notice.

21

 

     19. Assignment Prohibition. This Agreement may not be assigned by the Advisor without
the approval of the Board (including a majority of the Independent Directors); provided, however,
that such approval shall not be required in the case of an assignment to a corporation,
partnership, association, trust or organization which may take over the assets and carry on the
affairs of the Advisor, provided: (i) that at the time of such assignment, such successor
organization shall be owned substantially by an entity directly or indirectly controlled by the
Sponsor and only if such entity has a net worth of at least $5,000,000, and (ii) that the board of
directors of the Advisor shall deliver to the Board a statement in writing indicating the ownership
structure and net worth of the successor organization and a certification from the new Advisor as
to its net worth. Such an assignment shall bind the assignees hereunder in the same manner as the
Advisor is bound by this Agreement. The Advisor may assign any rights to receive fees or other
payments under this Agreement without obtaining the approval of the Board. This Agreement shall
not be assigned by CPA: 17 or the Operating Partnership without the consent of the Advisor, except
in the case of an assignment by CPA: 17 or the Operating Partnership to a corporation or other
organization which is a successor to CPA: 17 or the Operating Partnership, in which case such
successor organization shall be bound hereunder and by the terms of said assignment in the same
manner as CPA: 17 or the Operating Partnership is bound by this Agreement.

     20. Payments to and Duties of Advisor Upon Termination.

     (a) After the Termination Date, the Advisor shall not be entitled to compensation for
further services hereunder but shall be entitled to receive from CPA: 17 the following:

     (i) all unpaid reimbursements of Organization and Offering Expenses and of
Operating Expenses payable to the Advisor;

     (ii) all earned but unpaid Asset Management Fees payable to the Advisor prior
to the Termination Date;

     (iii) all earned but unpaid Acquisition Fees and interest thereon, in each case
payable to the Advisor relating to the acquisition of any Property prior to the
Termination Date;

     (iv) all earned but unpaid Subordinated Disposition Fees and interest thereon,
payable to the Advisor relating to the sale of any Investment prior to the
Termination Date; and

     (v) all earned but unpaid Property Management Fees and Loan Refinancing Fees,
if any, payable to the Advisor or its Affiliates relating to the management of any
property prior to the termination of this Agreement.

     (b) Notwithstanding the foregoing, if this Agreement is terminated by the Company for
Cause, or by the Advisor for other than Good Reason, the Advisor will not be entitled to
receive the sums in Section 20(a) (ii) through (v).

     (c) Any and all amounts payable to the Advisor pursuant to Section 20(a) that,
irrespective of the termination, were payable on a current basis prior to the Termination
Date either because they were not subordinated or all conditions to their payment had been
satisfied, shall be paid within 90 days after the Termination Date. All other amounts shall
be paid in a manner determined by the Board, but in no event on terms less favorable to the
Advisor than those represented by a note (i) maturing upon the liquidation of CPA: 17 or the
Operating Partnership or three years from the Termination Date, whichever is earlier, (ii)
with no less than

22

 

twelve equal quarterly installments and (iii) bearing a fair, competitive and
commercially reasonable interest rate (the “Note”). The Note, if any, may be
prepaid by the Operating Partnership at any time prior to maturity with accrued interest to
the date of payment but without premium or penalty. Notwithstanding the foregoing, any
amounts that relate to Investments (i) shall be an amount which provides compensation to the
Advisor only for that portion of the holding period for the respective Investments during
which the Advisor provided services to CPA: 17, (ii) shall not be due and payable until the
Investment Asset to which such amount relates is sold or refinanced, and (iii) shall not
bear interest until the Investment to which such amount relates is sold or refinanced. A
portion of the amount shall be paid as each Investment owned by CPA: 17 on the Termination
Date is sold. The portion of such amount payable upon each such sale shall be equal to (i)
such amount multiplied by (ii) the percentage calculated by dividing the fair value (at the
Termination Date) of the Investment sold by CPA: 17 divided by the total fair value (at the
Termination Date) of all Investments owned by CPA: 17 on the Termination Date.

     (d) The Advisor shall promptly upon termination.

     (i) pay over to the Operating Partnership all money collected and held for the
account of CPA: 17 pursuant to this Agreement, after deducting any accrued
compensation and reimbursement for its expenses to which it is then entitled;

     (ii) deliver to the Board a full accounting, including a statement showing all
payments collected by it and a statement of all money held by it, covering the
period following the date of the last accounting furnished to the Board;

     (iii) deliver to the Board all assets, including Properties and Loans, and
documents of CPA: 17 then in the custody of the Advisor; and

     (iv) cooperate with CPA: 17 to provide an orderly management transition.

     21. Indemnification by CPA: 17 and the Operating Partnership. Neither CPA: 17 nor the
Operating Partnership shall indemnify the Advisor or any of its Affiliates for any loss or
liability suffered by the Advisor or the Affiliate, or hold the Advisor or the Affiliate harmless
for any loss or liability suffered by CPA: 17, except as permitted under Section 7.

     22. Indemnification by Advisor. The Advisor shall indemnify and hold harmless CPA: 17
and the Operating Partnership from liability, claims, damages, taxes or losses and related expenses
including attorneys’ fees, to the extent that such liability, claims, damages, taxes or losses and
related expenses are not fully reimbursed by insurance and are incurred by reason of the Advisor’s
bad faith, fraud, willful misfeasance, misconduct, negligence or reckless disregard of its duties.

     23. Joint and Several Obligations. Any obligations of CPA: 17 shall be construed as
the joint and several obligations of CPA: 17 and the Operating Partnership, unless otherwise
specifically provided in this Agreement.

23

 

     24. Notices. Any notice, report or other communication required or permitted to be
given hereunder shall be in writing unless some other method of giving such notice, report or other
communication is accepted by the party to whom it is given, and shall be given by being delivered
by hand or by overnight mail or other overnight delivery service to the addresses set forth herein:

	 	 	 
	To the Board

	 	Corporate Property Associates 17 — Global
	and to CPA: 17:

	 	Incorporated
	 

	 	50 Rockefeller Plaza
	 

	 	New York, NY 10020
	 
	 	 
	To the Operating Partnership:

	 	c/o Corporate Property Associates 17 — Global
	 

	 	Incorporated
	 

	 	50 Rockefeller Plaza
	 

	 	New York, NY 10020
	 
	 	 
	To the Advisor:

	 	Carey Asset Management Corp.
	 

	 	50 Rockefeller Plaza

New York, NY 10020

     Either party may at any time give notice in writing to the other party of a change in its
address for the purposes of this Section 23.

     25. Modification. This Agreement shall not be changed, modified, terminated, or
discharged, in whole or in part, except by an instrument in writing signed by both parties hereto,
or their respective successors or assignees.

     26. Severability. The provisions of this Agreement are independent of and severable
from each other, and no provision shall be affected or rendered invalid or unenforceable by virtue
of the fact that for any reason any other or others of them may be invalid or unenforceable in
whole or in part.

     27. Construction. This Agreement shall be governed by, construed and enforced in
accordance with the laws of the State of New York.

     28. Entire Agreement. This Agreement contains the entire agreement and understanding
among the parties hereto with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements, understandings, inducements and conditions, express or implied, oral or
written, of any nature whatsoever with respect to the subject matter hereof. The express terms
hereof control and supersede any course of performance and/or usage of the trade inconsistent with
any of the terms hereof. This Agreement may not be modified or amended other than by an agreement
in writing.

     29. Indulgences, Not Waivers. Neither the failure nor any delay on the part of a
party to exercise any right, remedy, power or privilege under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege
preclude any other or further exercise of the same or of any other right, remedy, power or
privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any
other occurrence. No waiver shall be effective unless it is in writing and is signed by the party
asserted to have granted such waiver.

     30. Gender. Words used herein regardless of the number and gender specifically used,
shall be deemed and construed to include any other number, singular or plural, and any other
gender, masculine, feminine or neuter, as the context requires.

24

 

     31. Titles Not to Affect Interpretation. The titles of Sections and subsections
contained in this Agreement are for convenience only, and they neither form a part of this
Agreement nor are they to be used in the construction or interpretation hereof.

     32. Execution in Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original as against any party whose signature
appears thereon, and all of which shall together constitute one and the same instrument. This
Agreement shall become binding when one or more counterparts hereof, individually or taken
together, shall bear the signatures of all of the parties reflected hereon as the signatories.

     33. Name. W.P. Carey & Co. LLC has a proprietary interest in the name “Corporate
Property Associates” and “CPA®.” Accordingly, and in recognition of this right, if at any time
CPA: 17 ceases to retain Carey Asset Management Corp., or an Affiliate thereof to perform the
services of Advisor, CPA: 17 will, promptly after receipt of written request from Carey Asset
Management Corp., cease to conduct business under or use the name “Corporate Property Associates”
or “CPA®” or any diminutive thereof and CPA: 17 shall use its best efforts to change the name of
CPA: 17 to a name that does not contain the name “Corporate Property Associates” or “CPA®” or any
other word or words that might, in the sole discretion of the Advisor, be susceptible of indication
of some form of relationship between CPA: 17 and the Advisor or any Affiliate thereof. Consistent
with the foregoing, it is specifically recognized that the Advisor or one or more of its Affiliates
has in the past and may in the future organize, sponsor or otherwise permit to exist other
investment vehicles (including vehicles for investment in real estate) and financial and service
organizations having “Corporate Property Associates” or “CPA®” as a part of their name, all without
the need for any consent (and without the right to object thereto) by CPA: 17 or its Directors.

     34. Initial Investment. The Advisor has contributed to CPA: 17 $200,000 in exchange
for 22,222 Shares (the “Initial Investment”). The Advisor or its Affiliates may not sell
any of the Shares purchased with the Initial Investment during the term of this Agreement. The
restrictions included above shall not continue to apply to any Shares other than the Share acquired
through the Initial Investment acquired by the Advisor or its Affiliates. The Advisor shall not
vote any Shares it now owns or hereafter acquires in any vote for the election of Directors or any
vote regarding the approval or termination of any contract with the Advisor or any of its
Affiliates.

25

 

     IN WITNESS WHEREOF, the parties hereto have executed this Advisory Agreement as of the day and
year first above written.

	 	 	 	 	 
	 	CORPORATE PROPERTY ASSOCIATES 17 - 

GLOBAL INCORPORATED

 	 
	 	By:  	/s/ Mark J. DeCesaris
 	 
	 	 	Name:  	Mark J. DeCesaris 	 
	 	 	Title:  	Managing Director and
Acting Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	CAREY ASSET MANAGEMENT CORP.

 	 
	 	By:  	/s/ Gordon F. DuGan
 	 
	 	 	Name:  	Gordon F. DuGan 	 
	 	 	Title:  	President and Chief Executive Officer 	 
	 

	 	 	 	 	 
	 	CPA:17 LIMITED PARTNERSHIP

 	 
	 	By:  	/s/ Susan C. Hyde
 	 
	 	 	Name:  	Susan C. Hyde 	 
	 	 	Title:  	Managing Director and Secretary 	 
	 

 

 

SCHEDULE A

     This Schedule sets forth the terms governing any Shares issued by CPA: 17 to the Advisor in
payment of advisory fees set forth in the Agreement.

     1. Restrictions. The Shares are subject to vesting over a five-year period. The
Shares shall vest ratably over a five-year period with 20% of the Shares paid in each payment
vesting on each of the first through fifth anniversary of the date hereof. Prior to the vesting of
the ownership of the Shares in the Advisor, the Shares may not be transferred by the Advisor.

     2. Immediate Vesting. Upon the expiration of the Agreement for any reason other than
a termination for Cause under paragraph 17 or upon a “Change of Control” of CPA®:17 (as defined
below), all Shares granted to the Advisor hereunder shall vest immediately and all restrictions
shall lapse. For purposes of this Schedule A, a “Change of Control” of CPA: 17 shall be deemed to
have occurred if there has been a change in the ownership of CPA: 17 of a nature that would be
required to be reported in response to the disclosure requirements of Schedule 14A of Regulation
14A promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
as enacted and in force on the date hereof, whether or not CPA: 17 is then subject to such
reporting requirements; provided, however, that, without limitation, a Change of Control shall be
deemed to have occurred if:

     (i) any “person,” as such term is used in Sections 13(d) and 14(d) of the
Exchange Act (other than CPA: 17, any of its subsidiaries, any trustee, fiduciary or
other person or entity holding securities under any employee benefit plan of CPA: 17
or any of its subsidiaries), together with all “affiliates” and “associates” (as
such terms are defined in Rule 14b-2 under the Exchange Act) of such person, shall
become the “beneficial owner” (as such term is defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of CPA: 17 representing 25% or
more of either (A) the combined voting power of CPA: 17’s then outstanding
securities having the right to vote in an election of the Board (“Voting
Securities”) or (B) the then outstanding common stock of CPA: 17 (in either such
case other than as a result of acquisition of securities directly from CPA: 17);

     (ii) persons who, as of the date hereof, constitute the Board (the
“Incumbent Directors”) cease for any reason, including without limitation,
as a result of a tender offer, proxy contest, merger or similar transaction, to
constitute at least a majority of the Board, provided that any person becoming a
director of CPA: 17 subsequent to the date hereof whose election or nomination for
election was approved by a vote of at least a majority of the Incumbent Directors
shall be considered an Incumbent Director; or

     (iii) the stockholders of CPA: 17 shall approve (A) any consolidation or merger
of CPA: 17 or any subsidiary where the stockholders of CPA: 17, immediately prior to
the consolidation or merger, would not, immediately after the consolidation or
merger, beneficially own (as such term is defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, shares representing in the aggregate 50% or more of
the voting equity of the entity issuing cash or securities in the consolidation or
merger (or of its ultimate parent entity, if any), (B) any sale, lease, exchange or
other transfer (in one transaction or a series of transactions contemplated or
arranged by any party as a single plan) of all or substantially all of the assets of
CPA: 17 or (C) any plan or proposal for the liquidation or dissolution of CPA: 17.

Schedule A-1

 

 

     Notwithstanding the foregoing, a “Change of Control” shall not be deemed to have
occurred for purposes of the foregoing clause (i) solely as the result of an acquisition of
securities by CPA: 17 which, by reducing the number of Shares of Common Stock outstanding,
increases (A) the proportionate number of Shares beneficially owned by any person to 25% or more of
the Shares then outstanding, or (B) the proportionate voting power represented by the Shares
beneficially owned by any person to 25% or more of the combined voting power of all then
outstanding voting Securities; provided, however, that if any person referred to in clause (A) or
(B) of this sentence shall thereafter become the beneficial owner of any additional Shares or other
Voting Securities (other than pursuant to a Share split, Share dividend, or similar transaction),
then a “Change of Control” shall be deemed to have occurred for purposes of the foregoing clause
(i).

     3. Exception. Notwithstanding anything else in this Agreement to the contrary, the
Shares shall continue to vest according to the vesting schedule in Section 1 regardless of: (a)
the expiration of the Advisory Agreement for any reason other than a termination by CPA: 17 for
Cause or a resignation by the Advisor for other than Good Reason, (b) the merger of CPA: 17 and an
Affiliate of CPA: 17 or (c) any “Change of Control” of CPA: 17 in connection with a merger with an
Affiliate of CPA: 17.

Schedule A-2exv10w1

Exhibit 10.1

LOAN AND SECURITY AGREEMENT

     THIS
LOAN AND SECURITY AGREEMENT (this “Agreement”) dated as of November 2, 2009 (the
“Effective Date”) between SILICON VALLEY BANK, a California corporation with a loan production
office located at One Newton Executive Park, Suite 200, 2221 Washington Street, Newton,
Massachusetts 02462 (“Bank”), and SOUNDBITE COMMUNICATIONS, INC., a Delaware corporation
(“Borrower”), provides the terms on which Bank shall lend to Borrower and Borrower shall repay
Bank. The parties agree as follows:

     1 ACCOUNTING AND OTHER TERMS

     Accounting terms not defined in this Agreement shall be construed following GAAP.
Calculations and determinations must be made following GAAP. Capitalized terms not otherwise
defined in this Agreement shall have the meanings set forth in Section 13. All other terms
contained in this Agreement, unless otherwise indicated, shall have the meaning provided by the
Code to the extent such terms are defined therein.

     2 LOAN AND TERMS OF PAYMENT

     2.1 Promise to Pay. Borrower hereby unconditionally promises to pay Bank the outstanding
principal amount of all Credit Extensions and accrued and unpaid interest thereon as and when due
in accordance with this Agreement.

     2.1.1 Revolving Advances.

          (a) Availability. Subject to the terms and conditions of this Agreement, Bank shall
make Advances not exceeding the Availability Amount. Amounts borrowed under the Revolving Line may
be repaid and, prior to the Revolving Line Maturity Date, reborrowed, subject to the applicable
terms and conditions precedent herein.

          (b) Termination; Repayment. The Revolving Line terminates on the Revolving Line
Maturity Date, when the principal amount of all Advances, the unpaid interest thereon, and all
other Obligations relating to the Revolving Line shall be immediately due and payable. The
Revolving Line may be terminated at any time without penalty or premium.

     2.1.2 Letters of Credit Sublimit.

          (a) As part of the Revolving Line, Bank shall issue or have issued Letters of Credit for
Borrower’s account. The face amount of outstanding Letters of Credit (including drawn but
unreimbursed Letters of Credit and any Letter of Credit Reserve) may not exceed One Million Five
Hundred Dollars ($1,500,000.00). Such aggregate amounts utilized hereunder shall at all times
reduce the amount otherwise available for Advances under the Revolving Line. If, on the Revolving
Line Maturity Date, there are any outstanding Letters of Credit, then on such date Borrower shall
provide to Bank cash collateral in an amount equal to 105% of the face amount of all such Letters
of Credit plus all interest, fees, and costs due or to become due in connection therewith (as
estimated by Bank in its good faith business judgment), to secure all of the Obligations relating
to said Letters of Credit. All Letters of Credit shall be in form and substance acceptable to Bank
in its sole discretion and shall be subject to the terms and conditions of Bank’s standard
Application and Letter of Credit Agreement (the “Letter of Credit Application”). Borrower agrees
to execute any further documentation in connection with the Letters of Credit as Bank may
reasonably request. Borrower further agrees to be bound by the regulations and interpretations of
the issuer of any Letters of Credit guarantied by Bank and opened for Borrower’s account or by
Bank’s interpretations of any Letter of Credit issued by Bank for Borrower’s account, and Borrower
understands and agrees that Bank shall not be liable for any error, negligence, or mistake, whether
of omission or commission, in following Borrower’s instructions or those contained in the Letters
of Credit or any modifications, amendments, or supplements thereto.

          (b) The obligation of Borrower to immediately reimburse Bank for drawings made under Letters
of Credit shall be absolute, unconditional, and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement, such Letters of Credit, and the Letter of Credit
Application.

          (c) Borrower may request that Bank issue a Letter of Credit payable in a Foreign Currency. If
a demand for payment is made under any such Letter of Credit, Bank shall treat such demand as an
Advance to

 

 

Borrower of the equivalent of the amount thereof (plus fees and charges in connection
therewith such as wire, cable,
SWIFT or similar charges) in Dollars at the then-prevailing rate of exchange in San Francisco,
California, for sales of the Foreign Currency for transfer to the country issuing such Foreign
Currency.

          (d) To guard against fluctuations in currency exchange rates, upon the issuance of any Letter
of Credit payable in a Foreign Currency, Bank shall create a reserve (the “Letter of Credit
Reserve”) under the Revolving Line in an amount equal to ten percent (10%) of the face amount of
such Letter of Credit. The amount of the Letter of Credit Reserve may be adjusted by Bank from
time to time, with prior notice to Borrower, to account for fluctuations in the exchange rate. The
availability of funds under the Revolving Line shall be reduced by the amount of such Letter of
Credit Reserve for as long as such Letter of Credit remains outstanding.

     2.1.3 Foreign Exchange Sublimit. As part of the Revolving Line, Borrower may enter into
foreign exchange contracts with Bank under which Borrower commits to purchase from or sell to Bank
a specific amount of Foreign Currency (each, a “FX Forward Contract”) on a specified date (the
“Settlement Date”). FX Forward Contracts shall have a Settlement Date of at least one (1) FX
Business Day after the contract date and shall be subject to a reserve of ten percent (10%) of each
outstanding FX Forward Contract in a maximum aggregate amount equal to One Million Five Hundred
Dollars ($1,500,000.00) (such maximum shall be the “FX Reserve”). The aggregate amount of FX
Forward Contracts at any one time may not exceed ten (10) times the amount of the FX Reserve. The
amount otherwise available for Credit Extensions under the Revolving Line shall be reduced by an
amount equal to ten percent (10%) of each outstanding FX Forward Contract (the “FX Reduction
Amount”). Any amounts needed to fully reimburse Bank for amounts outstanding under FX Forward
Contracts will be treated as Advances under the Revolving Line and will accrue interest at the
interest rate applicable to Advances.

     2.1.4 Cash Management Services Sublimit. Borrower may use up to One Million Five Hundred
Thousand Dollars ($1,500,000.00) of the Revolving Line for Bank’s cash management services which
may include merchant services, direct deposit of payroll, business credit card, and check cashing
services identified in Bank’s various cash management services agreements (collectively, the “Cash
Management Services”). Any amounts Bank pays on behalf of Borrower or any amounts that are not
paid by Borrower for any Cash Management Services will be treated as Advances under the Revolving
Line and will accrue interest at the interest rate applicable to Advances.

     2.2 Overadvances. If, at any time, the Credit Extensions under Sections 2.1.1, 2.1.2, 2.1.3
and 2.1.4 exceed the lesser of either (a) the Revolving Line or (b) the Borrowing Base, Borrower
shall immediately pay to Bank in cash such excess (the “Overadvance”). To the extent that the
Overadvance exists as a result of Bank decreasing the percentages of the Borrowing Base, or
adjustment of the criteria for Eligible Accounts, Borrower shall have two (2) Business Days to pay
such portion of the Overadvance.

     2.3 Payment of Interest on the Credit Extensions.

          (a) Interest Rate. Subject to Section 2.3(b), the principal amount outstanding under
the Revolving Line shall accrue interest at a floating per annum rate equal to one-half of one
percent (0.50%) above the Prime Rate. Interest hereunder shall be payable monthly in accordance
with Section 2.3(f) below.

          (b) Default Rate. Immediately upon the occurrence and during the continuance of an
Event of Default, Obligations shall bear interest at a rate per annum which is four percentage
points (4.0%) above the rate effective immediately before the Event of Default (the “Default
Rate”). Payment or acceptance of the increased interest rate provided in this Section 2.3(b) is
not a permitted alternative to timely payment and shall not constitute a waiver of any Event of
Default or otherwise prejudice or limit any rights or remedies of Bank.

          (c) Adjustment to Interest Rate. Changes to the interest rate of any Credit Extension
based on changes to the Prime Rate shall be effective on the effective date of any change to the
Prime Rate and to the extent of any such change.

          (d) 360-Day Year. Interest shall be computed on the basis of a 360-day year for the
actual number of days elapsed.

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          (e) Debit of Accounts. Bank may debit any of Borrower’s deposit accounts, including
the Designated Deposit Account, for principal and interest payments or any other amounts Borrower
owes Bank when due. These debits shall not constitute a set-off.

          (f) Payments. Unless otherwise provided, interest is payable monthly on the first
(1st) Business Day of each month. Payments of principal and/or interest received after
2:00 p.m. Eastern time are considered received at the opening of business on the next Business Day.
When a payment is due on a day that is not a Business Day, the payment is due the next Business
Day and additional fees or interest, as applicable, shall continue to accrue.

     2.4 Fees. Borrower shall pay to Bank:

          (a) Commitment Fee. A fully earned, non-refundable commitment fee of Ten Thousand
Dollars ($10,000.00) on the Effective Date;

          (b) Due Diligence Fee. A fully-earned, non-refundable due diligence fee of Five
Thousand Dollars ($5,000.00) has previously been paid by Borrower. Any portion of the due
diligence fee not utilized to pay Bank Expenses shall be applied towards any other fees due and
payable hereunder;

          (c) Letter of Credit Fee. Bank’s customary fees and expenses for the issuance or
renewal of Letters of Credit, upon the issuance, each anniversary of the issuance, and the renewal
of such Letter of Credit; and

          (d) Bank Expenses. All Bank Expenses (including reasonable attorneys’ fees and
expenses, plus expenses, for documentation and negotiation of this Agreement) incurred through and
after the Effective Date, when due.

     3 CONDITIONS OF LOANS

     3.1 Conditions Precedent to Initial Credit Extension. Bank’s obligation to make the initial
Credit Extension is subject to the condition precedent that Bank shall have received, in form and
substance satisfactory to Bank, such documents, and completion of such other matters, as Bank may
reasonably deem necessary or appropriate, including, without limitation:

          (a) Duly executed original signatures to the Loan Documents to which it is a party;

          (b) Duly executed original signatures to the Control Agreements;

          (c) Borrower shall have delivered its Operating Documents and a good standing certificate of
Borrower certified by the Secretary of State of the State of Delaware as of a date no earlier than
thirty (30) days prior to the Effective Date;

          (d) Duly executed original signatures to the completed Borrowing Resolutions for Borrower;

          (e) Borrower shall have delivered the Perfection Certificates executed by Borrower and
Guarantor, together with the duly executed original signatures thereto;

          (f) Duly executed original signatures to the Unconditional Guaranty and Security Agreement,
together with the completed Borrowing Resolutions for Guarantor;

          (g) landlord’s consents with respect to each of Borrower’s leased locations;

          (h) Borrower shall have delivered evidence satisfactory to Bank that the insurance policies
required by Section 6.5 hereof are in full force and effect, together with appropriate evidence
showing lender loss payable and/or additional insured clauses or endorsements in favor of Bank; and

          (i) Borrower shall have paid the fees and Bank Expenses then due as specified in Section 2.4
hereof.

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     3.2 Conditions Precedent to all Credit Extensions. Bank’s obligations to make each Credit
Extension, including the initial Credit Extension, is subject to the following:

          (a) except as otherwise provided in Section 3.4, timely receipt of an executed Payment/Advance
Form;

          (b) the representations and warranties in Section 5 shall be true in all material respects on
the date of the Payment/Advance Form and on the Funding Date of each Credit Extension; provided,
however, that such materiality qualifier shall not be applicable to any representations and
warranties that already are qualified or modified by materiality in the text thereof; and provided,
further that those representations and warranties expressly referring to a specific date shall be
true, accurate and complete in all material respects as of such date, and no Default or Event of
Default shall have occurred and be continuing or result from the Credit Extension. Each Credit
Extension is Borrower’s representation and warranty on that date that the representations and
warranties in Section 5 remain true in all material respects; provided, however, that such
materiality qualifier shall not be applicable to any representations and warranties that already
are qualified or modified by materiality in the text thereof; and provided, further that those
representations and warranties expressly referring to a specific date shall be true, accurate and
complete in all material respects as of such date; and

          (c) in Bank’s reasonable discretion, there has not been any material impairment in the general
affairs, management, results of operation, financial condition or the prospect of repayment of the
Obligations, nor has there been any material adverse deviation by Borrower from the most recent
business plan of Borrower presented to and accepted by Bank.

     3.3 Covenant to Deliver.

     Borrower agrees to deliver to Bank each item required to be delivered to Bank under this
Agreement as a condition to any Credit Extension. Borrower expressly agrees that the extension of
a Credit Extension prior to the receipt by Bank of any such item shall not constitute a waiver by
Bank of Borrower’s obligation to deliver such item, and any such extension in the absence of a
required item shall be in Bank’s sole discretion.

     3.4 Procedures for Borrowing. Subject to the prior satisfaction of all other applicable
conditions to the making of an Advance set forth in this Agreement, to obtain an Advance (other
than Advances under Sections 2.1.2 or 2.1.4), Borrower shall notify Bank (which notice shall be
irrevocable) by electronic mail, facsimile, or telephone by 12:00 noon Eastern time on the Funding
Date of the Advance. Together with any such electronic or facsimile notification, Borrower shall
deliver to Bank by electronic mail or facsimile a completed Payment/Advance Form executed by a
Responsible Officer or his or her designee. Bank may rely on any telephone notice given by a
person whom Bank believes is a Responsible Officer or designee. Bank shall credit Advances to the
Designated Deposit Account. Bank may make Advances under this Agreement based on instructions from
a Responsible Officer or his or her designee or without instructions if the Advances are necessary
to meet Obligations which have become due.

     4 CREATION OF SECURITY INTEREST

     4.1 Grant of Security Interest. Borrower hereby grants Bank, to secure the payment and
performance in full of all of the Obligations, a continuing security interest in, and pledges to
Bank, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all
proceeds and products thereof. Borrower represents, warrants, and covenants that the security
interest granted herein is and shall at all times continue to be a first priority perfected
security interest in the Collateral (subject only to Permitted Liens that may have superior
priority to Bank’s Lien under this Agreement). If Borrower shall acquire a commercial tort claim
in an amount in excess of Two Hundred Fifty Thousand Dollars ($250,000.00), Borrower shall promptly
notify Bank in a writing signed by Borrower of the general details thereof and, upon request by
Bank, grant to Bank in such writing a security interest therein and in the proceeds thereof, all
upon the terms of this Agreement, with such writing to be in form and substance reasonably
satisfactory to Bank.

     If this Agreement is terminated, Bank’s Lien in the Collateral shall continue until the
Obligations (other than inchoate indemnity obligations) are repaid in full in cash. Upon payment
in full in cash of the Obligations and at such time as Bank’s obligation to make Credit Extensions
has terminated, Bank shall, at Borrower’s sole cost and expense, release its Liens in the
Collateral and all rights therein shall revert to Borrower.

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     4.2 Authorization to File Financing Statements. Borrower hereby authorizes Bank to file
financing statements, without notice to Borrower, with all appropriate jurisdictions to perfect or
protect Bank’s interest or rights hereunder, including a notice that any disposition of the
Collateral, by either Borrower or any other Person, shall be deemed to violate the rights of Bank
under the Code.

     5 REPRESENTATIONS AND WARRANTIES

          Borrower represents and warrants as follows:

     5.1 Due Organization and Authorization. Borrower and each of its Subsidiaries, if any, are
duly existing and in good standing, as Registered Organizations in their respective jurisdictions
of formation and are qualified and licensed to do business and are in good standing in any
jurisdiction in which the conduct of their business or their ownership of property requires that
they be qualified except where the failure to do so could not reasonably be expected to have a
material adverse effect on Borrower’s business. In connection with this Agreement, Borrower has
delivered to Bank completed certificates signed by Borrower and Guarantor, respectively (each, a
Perfection Certificate, and, collectively, the “Perfection Certificates”). Borrower represents and
warrants to Bank that (a) Borrower’s exact legal name is that indicated on Borrower’s Perfection
Certificate and on the signature page hereof; (b) Borrower is an organization of the type and is
organized in the jurisdiction set forth in Borrower’s Perfection Certificate; (c) Borrower’s
Perfection Certificate accurately sets forth Borrower’s organizational identification number or
accurately states that Borrower has none; (d)Borrower’s Perfection Certificate accurately sets
forth Borrower’s place of business, or, if more than one, its chief executive office as well as
Borrower’s mailing address (if different than its chief executive office); (e) Borrower (and each
of its predecessors) has not, in the past five (5) years, changed its jurisdiction of formation,
organizational structure or type, or any organizational number assigned by its jurisdiction; and
(f) all other information set forth on the Perfection Certificate pertaining to Borrower and each
of its Subsidiaries is accurate and complete in all material respects. If Borrower is not now a
Registered Organization but later becomes one, Borrower shall promptly notify Bank of such
occurrence and provide Bank with Borrower’s organizational identification number.

     The execution, delivery and performance of the Loan Documents have been duly authorized, and
do not conflict with Borrower’s organizational documents, nor constitute an event of default under
any material agreement by which Borrower is bound. Borrower is not in default under any agreement
to which it is a party or by which it is bound in which the default could have a material adverse
effect on Borrower’s business.

     5.2 Collateral. Borrower has good title to, and has rights in or the power to transfer each
item of the Collateral upon which it purports to grant a Lien hereunder, free and clear of any and
all Liens except Permitted Liens. As of the Effective Date, Borrower has no deposit accounts other
than the deposit accounts with Bank, the deposit accounts, if any, described in the Perfection
Certificate delivered to Bank in connection herewith, or of which Borrower has given Bank notice
and taken such actions as are necessary to give Bank a perfected security interest therein. The
Accounts are bona fide, existing obligations of the Account Debtors.

     The Collateral is not in the possession of any third party bailee (such as a warehouse) except
as otherwise provided in the Perfection Certificate. None of the components of the Collateral
shall be maintained at locations other than as provided in the Perfection Certificate or as
Borrower has given Bank notice pursuant to Section 7.2. In the event that Borrower, after the date
hereof, intends to store or otherwise deliver any portion of the Collateral to a bailee, then
Borrower will first receive the written consent of Bank and such bailee must execute and deliver a
bailee agreement in form and substance satisfactory to Bank in its sole discretion.

     All Inventory is in all material respects of good and marketable quality, free from material
defects.

     Except as noted on Borrower’s Perfection Certificate, Borrower is not, as of the date hereof,
a party to, nor is bound by, any license or other agreement with respect to which Borrower is the
licensee that prohibits or otherwise restricts Borrower from granting a security interest in
Borrower’s interest in such license or agreement or any other property. Borrower shall provide
written notice to Bank within ten (10) days of entering or becoming bound by any such license or
agreement which is reasonably likely to have a material impact on Borrower’s business or financial
condition (other than over-the-counter software that is commercially available to the public).
Borrower shall take such steps as Bank requests to obtain the consent of, or waiver by, any person
whose consent or waiver is necessary for all such licenses or contract rights to be deemed
“Collateral” and for Bank to have a security interest in it that might otherwise be restricted or
prohibited by law or by the terms of any such license or agreement

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(such consent or authorization
may include a licensor’s agreement to a contingent assignment of the license to Bank if Bank
determines that is necessary in its good faith judgment), whether now existing or entered into in
the future.

     5.3 Accounts Receivable. For any Eligible Account in any Borrowing Base Certificate, all
statements made and all unpaid balances appearing in all invoices, instruments and other documents
evidencing such Eligible Accounts are and shall be true and correct and all such invoices,
instruments and other documents, and all of Borrower’s Books are genuine and in all respects what
they purport to be. All sales and other transactions underlying or giving rise to each Eligible
Account shall comply in all material respects with all applicable laws and governmental rules and
regulations. Borrower has no knowledge of any actual or imminent Insolvency Proceeding of any
Account Debtor whose accounts are an Eligible Account in any Borrowing Base Certificate. To the
best of Borrower’s knowledge, all signatures and endorsements on all documents, instruments, and
agreements relating to
all Eligible Accounts are genuine, and all such documents, instruments and agreements are
legally enforceable in accordance with their terms.

     5.4 Litigation. There are no actions or proceedings pending or, to the knowledge of the
Responsible Officers, threatened in writing by or against Borrower or any of its Subsidiaries
involving more than Two Hundred Fifty Thousand Dollars ($250,000.00).

     5.5 No Material Deterioration in Financial Statements. All consolidated financial statements
for Borrower and any of its Subsidiaries delivered to Bank fairly present in all material respects
Borrower’s consolidated financial condition and Borrower’s consolidated results of operations.
There has not been any material deterioration in Borrower’s consolidated financial condition since
the date of the most recent financial statements submitted to Bank.

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

     5.7 Regulatory Compliance. Borrower is not an “investment company” or a company “controlled”
by an “investment company” under the Investment Company Act of 1940, as amended. Borrower is not
engaged as one of its important activities in extending credit for margin stock (under Regulations
T and U of the Federal Reserve Board of Governors). Borrower has complied in all material respects
with the Federal Fair Labor Standards Act. Borrower has not violated any laws, ordinances or
rules, the violation of which could reasonably be expected to have a material adverse effect on its
business. None of Borrower’s or any of its Subsidiaries’ properties or assets has been used by
Borrower or any Subsidiary or, to the best of Borrower’s knowledge, by previous Persons, in
disposing, producing, storing, treating, or transporting any hazardous substance other than
legally. Borrower and each of its Subsidiaries have obtained all consents, approvals and
authorizations of, made all declarations or filings with, and given all notices to, all government
authorities that are necessary to continue their respective businesses as currently conducted,
except where the failure to do so would not reasonably be expected to have a material adverse
effect on Borrower’s business or operations.

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

     5.9 Tax Returns and Payments; Pension Contributions. Borrower has timely filed all required
tax returns and reports, and Borrower and its Subsidiaries have timely paid all foreign, federal,
state and local taxes, assessments, deposits and contributions owed by Borrower, except where the
amount of associated tax liability does not exceed Seventy-Five Thousand Dollars ($75,000.00).
Borrower may defer payment of any contested taxes, provided that Borrower (a) in good faith
contests its obligation to pay the taxes by appropriate proceedings promptly and diligently
instituted and conducted, (b) notifies Bank in writing of the commencement of, and any material
development in, the proceedings, (c) posts bonds or takes any other steps required to prevent the
governmental authority levying such contested taxes from obtaining a Lien upon any of the
Collateral that is other than a “Permitted Lien”. Borrower is unaware of any claims or adjustments
proposed for any of Borrower’s prior tax years which could result in additional taxes becoming due
and payable by Borrower. Borrower has paid all amounts necessary to fund all present pension,
profit sharing and deferred compensation plans in accordance with their terms, and Borrower has not
withdrawn from participation in, and has not permitted partial or complete termination of, or
permitted the occurrence of any other event with respect to, any such plan which could reasonably
be expected to result in any liability of Borrower, including any liability to the Pension Benefit
Guaranty Corporation or its successors or any other governmental agency.

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     5.10 Use of Proceeds. Borrower shall use the proceeds of the Credit Extensions solely as
working capital and not for personal, family, household or agricultural purposes

     5.11 Assets of Canadian Subsidiary. Borrower’s Canadian Subsidiary, SoundBite Communications
Canada, Inc., does not and will not own or possess assets with an aggregate value in excess of One
Million Dollars ($1,000,000.00).

     5.12 Full Disclosure. No written representation, warranty or other statement of Borrower in
any certificate or written statement given to Bank, as of the date such representation, warranty,
or other statement was made, taken together with all such written certificates and written
statements given to Bank, contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained in the certificates or statements not
misleading (it being recognized by Bank that the projections and forecasts provided by
Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that
actual results during the period or periods covered by such projections and forecasts may differ
from the projected or forecasted results).

     6 AFFIRMATIVE COVENANTS

     Borrower shall do all of the following:

     6.1 Government Compliance. Maintain its and all its Subsidiaries’ legal existence and good
standing in their respective jurisdictions of formation and maintain qualification in each
jurisdiction in which the failure to so qualify would reasonably be expected to have a material
adverse effect on Borrower’s business or operations. Borrower shall comply, and have each
Subsidiary comply, with all laws, ordinances and regulations to which it is subject, the
noncompliance with which could reasonably be expected to have a material adverse effect on
Borrower’s business.

     6.2 Financial Statements, Reports, Certificates.

          (a) Deliver to Bank: (i) within five (5) days of filing with the Securities and Exchange
Commission, but in any event no later than forty-five (45) days after the last day of its fiscal
year, audited consolidated financial statements prepared under GAAP on Form 10-K as filed with the
Securities and Exchange Commission, consistently applied, together with an unqualified opinion on
the financial statements from an independent certified public accounting firm acceptable to Bank in
its reasonable discretion; (ii) within five (5) days of delivery, copies of all statements, reports
and notices made available to Borrower’s security holders or to any holders of Subordinated Debt;
(iii) within five (5) days of filing with the Securities and Exchange Commission, all reports on
Form 8-K as filed with the Securities and Exchange Commission or a link thereto on Borrower’s or
another website on the internet; (iv) within five (5) days of filing with the Securities and
Exchange Commission, but in any event no later than forty-five (45) days after the last day of each
quarter, a company prepared consolidating balance sheet and income statement covering Borrower’s
consolidated operations for such quarter on Form 10-Q; (v) a prompt report of any legal actions
pending or, to Borrower’s knowledge, threatened against Borrower or any of its Subsidiaries that
could reasonably be expected to result in damages or costs to Borrower or any of its Subsidiaries
of Two Hundred Fifty Thousand Dollars ($250,000.00) or more; (vi) as soon as available and no later
than forty-five (45) days after approval by Borrower’s board of directors, but at least annually,
Borrower’s financial projections for current fiscal year as approved by Borrower’s board of
directors; and (vii) budgets, sales projections, operating plans and other financial information
reasonably requested by Bank.

          (b) Within thirty (30) days after the last day of each month in which Credit Extensions made
pursuant to Section 2.1.1 are outstanding or in which any such Credit Extensions have been
requested, deliver to Bank a duly completed Borrowing Base Certificate signed by a Responsible
Officer, with aged listings of accounts receivable and accounts payable (by invoice date).

          (c) Within five (5) days of filing its 10-Q or 10-K with the Securities and Exchange
Commission, but in any event no later than forty-five (45) days after the last day of each quarter
(including the final quarter of each fiscal year), a duly completed Compliance Certificate signed
by a Responsible Officer setting forth calculations showing compliance with the financial covenants
set forth in this Agreement.

          (d) Upon the occurrence of the first request for an Advance pursuant to Section 2.1.1, allow
Bank to audit Borrower’s Collateral at Borrower’s expense. Such audits shall be conducted no more
often than once

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every twelve (12) months unless a Default or an Event of Default has occurred and
is continuing. Borrower hereby acknowledges that the first such audit will be conducted within
sixty (60) days after the date on which Borrower requests the first Advance pursuant to Section
2.1.1. The charge for each audit shall not exceed Eight Hundred Fifty Dollars ($850.00) (or such
higher amount as shall represent Bank’s then-current standard charge for the same), per person per
day, plus out of pocket expenses.

     6.3 Inventory; Returns. Keep all Inventory in good and marketable condition, free from
material defects. Returns and allowances between Borrower and its Account Debtors shall follow
Borrower’s customary practices as they exist at the Effective Date. Borrower must promptly notify
Bank of all returns, recoveries, disputes and claims that involve more than Two Hundred Fifty
Thousand Dollars ($250,000.00).

     6.4 Taxes; Pensions. Make, and cause each of its Subsidiaries to make, timely payment of all
foreign, federal, state, and local taxes or assessments (other than taxes and assessments which
Borrower is contesting pursuant to the terms of Section 5.9 hereof) and shall deliver to Bank, on
demand, appropriate certificates
attesting to such payments, and pay all amounts necessary to fund all present pension, profit
sharing and deferred compensation plans in accordance with their terms.

     6.5 Insurance. Keep its business and the Collateral insured for risks and in amounts standard
for companies in Borrower’s industry and location and as Bank may reasonably request. Insurance
policies shall be in a form, with companies, and in amounts that are satisfactory to Bank. All
property policies shall have a loss payable endorsement showing Bank as loss payee and waive
subrogation against Bank, and all liability policies shall show, or have endorsements showing, Bank
as an additional insured. All policies (or the loss payable and additional insured endorsements)
shall provide that the insurer must give Bank at least twenty (20) days notice before canceling,
amending, or declining to renew its policy. At Bank’s request, Borrower shall deliver certified
copies of policies and evidence of all premium payments. Proceeds payable under any policy shall,
at Bank’s option, be payable to Bank on account of the Obligations. Notwithstanding the foregoing,
(a) so long as no Event of Default has occurred and is continuing, Borrower shall have the option
of applying the proceeds of any casualty policy up to Five Hundred Thousand Dollars ($500,000.00),
in the aggregate, toward the replacement or repair of destroyed or damaged property; provided that
any such replaced or repaired property (i) shall be of equal or like value as the replaced or
repaired Collateral and (ii) shall be deemed Collateral in which Bank has been granted a first
priority security interest, and (b) after the occurrence and during the continuance of an Event of
Default, all proceeds payable under such casualty policy shall, at the option of Bank, be payable
to Bank on account of the Obligations. If Borrower fails to obtain insurance as required under this
Section 6.5 or to pay any amount or furnish any required proof of payment to third persons and
Bank, Bank may make all or part of such payment or obtain such insurance policies required in this
Section 6.5, and take any action under the policies Bank deems prudent.

     6.6 Accounts.

          (a) Maintain its and its Subsidiaries’ primary operating accounts with Bank and Bank’s
affiliates. In addition, Borrower shall maintain cash or securities with Bank and Bank’s
affiliates in an amount equal to at least the lesser of: (i) a majority Borrower’s cash or
securities in excess of that amount used for Borrower’s current operations, and (ii) the aggregate
amount of outstanding Obligations. If at any time Borrower fails to comply with this Section
6.6(a) in any respect, then at such time and thereafter, each Guarantor shall maintain funds in an
operating account with Bank in an amount equal to at least the aggregate amount of outstanding
Obligations.

          (b) Provide Bank five (5) days prior written notice before establishing any Collateral Account
at or with any bank or financial institution other than Bank or its Affiliates. In addition, for
each Collateral Account that Borrower or Guarantor at any time maintains, Borrower shall cause the
applicable bank or financial institution (other than Bank) at or with which any Collateral Account
is maintained to execute and deliver a Control Agreement or other appropriate instrument with
respect to such Collateral Account to perfect Bank’s Lien in such Collateral Account in accordance
with the terms hereunder. The provisions of the previous sentence shall not apply to deposit
accounts exclusively used for payroll, payroll taxes and other employee wage and benefit payments
to or for the benefit of Borrower’s employees and identified to Bank by Borrower as such.

     6.7 Financial Covenants.

          Borrower shall maintain at all times, to be tested as of the last day of each quarter, to be
tested on a consolidated basis with respect to Borrower and its Subsidiaries:

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          (a) Adjusted Quick Ratio. To be maintained at all times and tested as of the last day of each
quarter, a ratio of (i) Quick Assets to (ii) Total Liabilities minus Deferred Revenue, of at least
2.0 to 1.0.

          (b) Minimum Quarterly Net Revenue. For the quarter ended June 30, 2009, and as of the last
day of each quarter thereafter, Borrower shall have quarterly net revenue of at least the greater
of (i) Nine Million Dollars ($9,000,000.00), and (ii) seventy-five percent (75.0%) of Borrower’s
board-approved operating plan.

     6.8 Protection of Intellectual Property Rights. Except as shall be consistent with sound
business practices, Borrower shall protect, defend and maintain the validity and enforceability of
its intellectual property.

     6.9 Litigation Cooperation. From the date hereof and continuing through the termination of
this Agreement, make available to Bank, without expense to Bank, Borrower and its officers,
employees and agents and Borrower’s books and records, to the extent that Bank may deem them
reasonably necessary to prosecute or defend any third-party suit or proceeding instituted by or
against Bank with respect to any Collateral or relating to Borrower.

     6.10 Further Assurances. Execute any further instruments and take further action as Bank
reasonably requests to perfect or continue Bank’s Lien in the Collateral or to effect the purposes
of this Agreement.

     6.11 Change in Management. Notify Bank of any material change in management, within thirty
(30) days of such change.

     7 NEGATIVE COVENANTS

     Borrower shall not do any of the following without Bank’s prior written consent:

     7.1 Dispositions. Convey, sell, lease, transfer, assign, or otherwise dispose of
(collectively “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its
business or property, except for:

     (a) Transfers in the ordinary course of business (or with respect to assets or property which
is obsolete or no longer useful in the business) for reasonably equivalent consideration;

     (b) Transfers of property in connection with sale-leaseback transactions;

     (c) Transfers of property to the extent such property is exchanged for credit against, or
proceeds are promptly applied to, the purchase price of other property used or useful in the
business of Borrower or its Subsidiaries;

     (d) Transfers constituting non-exclusive licenses and similar arrangements for the use of the
property of Borrower or its Subsidiaries in the ordinary course of business and other non-perpetual
licenses that may be exclusive in some respects other than territory (and/or that may be exclusive
as to territory only in discreet geographical areas outside of the United States), but that could
not result in a legal transfer of Borrower’s title in the licensed property;

     (e) Transfers otherwise permitted by the Loan Documents;

     (f) sales or discounting of delinquent accounts in the ordinary course of business;

     (g) Transfers associated with the making or disposition of a Permitted Investment;

     (h) Transfers in connection with a permitted acquisition of a portion of the assets or rights
acquired;

     (i) Transfers (i) from any Subsidiary to Borrower, and (ii) from Borrower to its Subsidiaries
in an amount up to One Million Dollars ($1,000,000.00) in the aggregate per year; and

     (j) Transfers of assets (other than Accounts and Inventory (unless such Transfer is in the
ordinary course of Borrower’s business)) not otherwise permitted in this Section 7.1, provided,
that the aggregate book value of all such Transfers by Borrower and its Subsidiaries, together,
shall not exceed in any fiscal year, five percent

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(5.0%) of Borrower’s consolidated total assets as
of the last day of the fiscal year immediately preceding the date of determination.

     7.2 Changes in Business, Ownership, or Business Locations. (a) Engage in or permit any of its
Subsidiaries to engage in any business other than the businesses currently engaged in by Borrower
and such Subsidiary, as applicable, or reasonably related thereto; or (b) liquidate or dissolve.
Borrower shall not, without at least thirty (30) days prior written notice to Bank: (1) add any new
offices or business locations, including warehouses (unless such new offices or business locations
contain less than Two Hundred Fifty Thousand Dollars ($250,000.00) in Borrower’s assets or
property), (2) change its jurisdiction of organization, (3) change its organizational structure or
type, (4) change its legal name, or (5) change any organizational number (if any) assigned by its
jurisdiction of organization.

     7.3 Mergers or Acquisitions. Merge or consolidate, or permit any of its Subsidiaries to merge
or consolidate, with any Person other than with Borrower or any Subsidiary, or acquire, or permit
any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of a
Person other than Borrower or any Subsidiary, except where no Event of Default has occurred and is
continuing or would result from such action during the term of this Agreement, and (a) Borrower is
a surviving entity or (b) such merger or consolidation is a Transfer otherwise permitted pursuant
to Section 7.1 hereof.

     7.4 Indebtedness. Create, incur, assume, or be liable for any Indebtedness, or permit any
Subsidiary to do so, other than Permitted Indebtedness.

     7.5 Encumbrance. Create, incur, or allow any Lien on any of its property, or assign or convey
any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries
to do so, except for Permitted Liens, or permit any Collateral not to be subject to the first
priority security interest granted herein, or enter into any agreement, document, instrument or
other arrangement (except with or in favor of Bank) with any Person which directly or indirectly
prohibits or has the effect of prohibiting Borrower or any Subsidiary from assigning, mortgaging,
pledging, granting a security interest in or upon, or encumbering any of Borrower’s or any
Subsidiary’s intellectual property, except as is otherwise permitted in Section 7.1 hereof and the
definition of “Permitted Liens” herein.

     7.6 Maintenance of Collateral Accounts. Maintain any Collateral Account except pursuant to
the terms of Section 6.6(b) hereof.

     7.7 Distributions; Investments. (a) Pay any dividends or make any distribution or payment or
redeem, retire or purchase any capital stock other than Permitted Distributions; or (b) directly or
indirectly acquire or own any Person, or make any Investment in any Person, other than Permitted
Investments, or permit any of its Subsidiaries to do so.

     7.8 Transactions with Affiliates. Directly or indirectly enter into or permit to exist any
material transaction with any Affiliate of Borrower except for (a) transactions that are in the
ordinary course of Borrower’s business (except that such transactions do not need to be in the
ordinary course of Borrower’s business if the Affiliate is a Subsidiary), upon fair and reasonable
terms (when viewed in the context of any series of transactions of which it may be a part, if
applicable) that are no less favorable to Borrower than would be obtained in an arm’s length
transaction with a non-affiliated Person; or (b) transactions among Borrower and its Subsidiaries
and among Borrower’s Subsidiaries so long as no Event of Default exists or could reasonably be
expected to result therefrom.

     7.9 Subordinated Debt. (a) Make or permit any payment on any Subordinated Debt, except under
the terms of the subordination, intercreditor, or other similar agreement to which such
Subordinated Debt is subject, or (b) amend any provision in any document relating to the
Subordinated Debt which would increase the amount thereof or adversely affect the subordination
thereof to Obligations owed to Bank.

     7.10 Compliance. Become an “investment company” or a company controlled by an “investment
company”, under the Investment Company Act of 1940, as amended, or undertake as one of its
important activities extending credit to purchase or carry margin stock (as defined in Regulation U
of the Board of Governors of the Federal Reserve System), or use the proceeds of any Credit
Extension for that purpose; fail to meet the minimum funding requirements of ERISA, permit a
Reportable Event or Prohibited Transaction, as defined in ERISA, to occur; fail to comply with the
Federal Fair Labor Standards Act or violate any other law or regulation, if the violation could
reasonably be expected to have a material adverse effect on Borrower’s business, or permit any of
its

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Subsidiaries to do so; withdraw or permit any Subsidiary to withdraw from participation in,
permit partial or complete termination of, or permit the occurrence of any other event with respect
to, any present pension, profit sharing and deferred compensation plan which could reasonably be
expected to result in any liability of Borrower, including any liability to the Pension Benefit
Guaranty Corporation or its successors or any other governmental agency.

     8 EVENTS OF DEFAULT

     Any one of the following shall constitute an event of default (an “Event of Default”) under
this Agreement:

     8.1 Payment Default. Borrower fails to (a) make any payment of principal or interest on any
Credit Extension on its due date, or (b) pay any other Obligations within three (3) Business Days
after such Obligations are due and payable (which three (3) Business Day grace period will not
apply to payments due on the Revolving Line Maturity Date). During the cure period, the failure to
cure the payment default is not an Event of Default (but no Credit Extension will be made during
the cure period);

     8.2 Covenant Default.

          (a) Borrower fails or neglects to perform any obligation in Sections 6.2, 6.5, 6.6, 6.7, or
violates any covenant in Section 7; or

          (b) Borrower fails or neglects to perform, keep, or observe any other term, provision,
condition, covenant or agreement contained in this Agreement, any Loan Documents, and as to any
default (other than those specified in this Section 8) under such other term, provision, condition,
covenant or agreement that can be cured, has failed to cure the default within ten (10) days after
the occurrence thereof; provided, however, that if the default cannot by its nature be cured within
the ten (10) day period or cannot after diligent attempts by Borrower be cured within such ten (10)
day period, and such default is likely to be cured within a reasonable time, then Borrower shall
have an additional period (which shall not in any case exceed thirty (30) days) to attempt to cure
such default, and within such reasonable time period the failure to cure the default shall not be
deemed an Event of Default (but no Credit Extensions shall be made during such cure period). Grace
periods provided under this Section shall not apply, among other things, to financial covenants or
any other covenants set forth in subsection (a) above;

     8.3 Material Adverse Change. A Material Adverse Change occurs;

     8.4 Attachment. (a) Any material portion of Borrower’s assets is attached, seized, levied on,
or comes into possession of a trustee or receiver and the attachment, seizure or levy is not
removed in ten (10) days; (b) the service of process seeking to attach, by trustee or similar
process, any funds of Borrower, or of any entity under control of Borrower (including a
Subsidiary), on deposit with Bank or Bank’s Affiliate; (c) Borrower is enjoined, restrained, or
prevented by court order from conducting a material part of its business; (d) a judgment or other
claim in excess of Two Hundred Fifty Thousand Dollars ($250,000) becomes a Lien on any of
Borrower’s assets; or (e) a notice of lien, levy, or assessment is filed against any of Borrower’s
assets by any government agency and not paid within ten (10) days after Borrower receives notice.
These are not Events of Default if stayed or if a bond is posted pending contest by Borrower (but
no Credit Extensions shall be made during the cure period);

     8.5 Insolvency (a) Borrower is unable to pay its debts (including trade debts) as they become
due or otherwise becomes insolvent; (b) Borrower begins an Insolvency Proceeding; or (c) an
Insolvency Proceeding is begun against Borrower and not dismissed or stayed within forty-five (45)
days (but no Credit Extensions shall be made while of any of the conditions described in clause (a)
exist and/or until any Insolvency Proceeding is dismissed);

     8.6 Other Agreements. If Borrower or Guarantor fails to (a) make any payment that is due and
payable with respect to any Material Indebtedness and such failure continues after the applicable
grace or notice period, if any, specified in the agreement or instrument relating thereto (unless
waived), or (b) perform or observe any other condition or covenant, or any other event shall occur
or condition exist under any agreement or instrument relating to any Material Indebtedness, and
such failure continues after the applicable grace or notice period, if any, specified in the
agreement or instrument relating thereto and the effect of such failure, event or condition is to
cause

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the holder or holders of such Material Indebtedness to accelerate the maturity of such
Material Indebtedness or cause the mandatory repurchase of any Material Indebtedness;

     8.7 Judgments. A judgment or judgments for the payment of money in an amount, individually or
in the aggregate, of at least Two Hundred Fifty Thousand Dollars ($250,000) (not covered by
independent third-party insurance) shall be rendered against Borrower and shall remain unsatisfied
and unstayed for a period of ten (10) days after the entry thereof (provided that no Credit
Extensions will be made prior to the satisfaction or stay of such judgment);

     8.8 Misrepresentations. Borrower or any Person acting for Borrower makes any representation,
warranty, or other statement now or later in this Agreement, any Loan Document or in any writing
delivered to Bank or to induce Bank to enter this Agreement or any Loan Document, and such
representation, warranty, or other statement is incorrect in any material respect when made;

     8.9 Subordinated Debt. Any creditor of Borrower that signed a subordination, intercreditor,
or other similar agreement with Bank, breaches any terms of such agreement; or

     8.10 Guaranty. (a) Any guaranty of any Obligations terminates or ceases for any reason to be
in full force and effect; (b) any Guarantor does not perform any obligation or covenant under any
guaranty of the Obligations; (c) any circumstance described in Sections 8.3, 8.4, 8.5, 8.7, or 8.8.
occurs with respect to any Guarantor, (d) the liquidation, winding up, or termination of existence
of any Guarantor; or (e) (i) a material impairment in the perfection or priority of Bank’s Lien in
the collateral provided by Guarantor or in the value of
such collateral or (ii) a material adverse change in the general affairs, management, results
of operation, condition (financial or otherwise) or the prospect of repayment of the Obligations
occurs with respect to any Guarantor.

     9 BANK’S RIGHTS AND REMEDIES

     9.1 Rights and Remedies. While an Event of Default occurs and continues Bank may, without
notice or demand, do any or all of the following:

          (a) declare all Obligations immediately due and payable (but if an Event of Default described
in Section 8.5 occurs all Obligations are immediately due and payable without any action by Bank);

          (b) stop advancing money or extending credit for Borrower’s benefit under this Agreement or
under any other agreement between Borrower and Bank;

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

          (d) terminate any FX Forward Contracts;

          (e) settle or adjust disputes and claims directly with Account Debtors for amounts on terms
and in any order that Bank considers advisable, notify any Person owing Borrower money of Bank’s
security interest in such funds, and verify the amount of such account;

          (f) make any payments and do any acts it considers necessary or reasonable to protect the
Collateral and/or its security interest in the Collateral. Borrower shall assemble the Collateral
if Bank requests and make it available as Bank designates. Bank may enter premises where the
Collateral is located, take and maintain possession of any part of the Collateral, and pay,
purchase, contest, or compromise any Lien which appears to be prior or superior to its security
interest and pay all expenses incurred. Borrower grants Bank a license to enter and occupy any of
its premises, without charge, to exercise any of Bank’s rights or remedies;

          (g) apply to the Obligations any (i) balances and deposits of Borrower it holds, or (ii) any
amount held by Bank owing to or for the credit or the account of Borrower;

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          (h) ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for
sale, and sell the Collateral. Bank is hereby granted a non-exclusive, royalty-free license or
other right to use, without charge, Borrower’s labels, patents, copyrights, mask works, rights of
use of any name, trade secrets, trade names, trademarks, service marks, and advertising matter, or
any similar property as it pertains to the Collateral, in completing production of, advertising for
sale, and selling any Collateral and, in connection with Bank’s exercise of its rights under this
Section, Borrower’s rights under all licenses and all franchise agreements inure to Bank’s benefit;

          (i) deliver a notice of exclusive control, any entitlement order, or other directions or
instructions pursuant to any Control Agreement or similar agreements providing control of any
Collateral;

          (j) demand and receive possession of Borrower’s Books; and

          (k) exercise all rights and remedies available to Bank under the Loan Documents or at law or
equity, including all remedies provided under the Code (including disposal of the Collateral
pursuant to the terms thereof).

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

     9.3 Accounts Verification; Collection. Whether or not an Event of Default has occurred and is
continuing, Bank may notify any Person owing Borrower money of Bank’s security interest in such
funds and verify the amount of such account. After the occurrence of an Event of Default, any
amounts received by Borrower shall be held in trust by Borrower for Bank, and, if requested by
Bank, Borrower shall immediately deliver such receipts to Bank in the form received from the
Account Debtor, with proper endorsements for deposit.

     9.4 Protective Payments. If Borrower fails to obtain the insurance called for by Section 6.5
or fails to pay any premium thereon or fails to pay any other amount which Borrower is obligated to
pay under this Agreement or any other Loan Document, Bank may obtain such insurance or make such
payment, and all amounts so paid by Bank are Bank Expenses and immediately due and payable, bearing
interest at the then highest applicable rate charged by Bank, and secured by the Collateral. Bank
will make reasonable efforts to provide Borrower with notice of Bank obtaining such insurance at
the time it is obtained or within a reasonable time thereafter. No payments by Bank are deemed an
agreement to make similar payments in the future or Bank’s waiver of any Event of Default.

     9.5 Application of Payments and Proceeds. Unless an Event of Default has occurred and is
continuing, Bank shall apply any funds in its possession, whether from Borrower account balances,
payments, or proceeds realized as the result of any collection of Accounts or other disposition of
the Collateral, first, to Bank Expenses, including without limitation, the reasonable costs,
expenses, liabilities, obligations and attorneys’ fees incurred by Bank in the exercise of its
rights under this Agreement; second, to the interest due upon any of the Obligations; and third, to
the principal of the Obligations and any applicable fees and other charges, in such order as Bank
shall determine in its sole discretion. Any surplus shall be paid to Borrower or other Persons
legally entitled thereto; Borrower shall remain liable to Bank for any deficiency. If an Event of
Default has occurred and is continuing, Bank may apply any funds in its possession, whether from
Borrower account balances, payments, proceeds realized as the result of any collection of Accounts
or other disposition of the Collateral, or otherwise, to the Obligations in such order as Bank
shall determine in its sole discretion. Any surplus shall be paid to Borrower or other Persons
legally entitled thereto; Borrower shall remain liable to Bank for any deficiency. If Bank, in its

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good faith business judgment, directly or indirectly enters into a deferred payment or other credit
transaction with any purchaser at any sale of Collateral, Bank shall have the option, exercisable
at any time, of either reducing the Obligations by the principal amount of the purchase price or
deferring the reduction of the Obligations until the actual receipt by Bank of cash therefor.

     9.6 Bank’s Liability for Collateral. So long as Bank complies with reasonable banking
practices regarding the safekeeping of the Collateral in the possession or under the control of
Bank, Bank shall not be liable or responsible for: (a) the safekeeping of the Collateral; (b) any
loss or damage to the Collateral; (c) any diminution in the value of the Collateral; or (d) any act
or default of any carrier, warehouseman, bailee, or other Person. Borrower bears all risk of loss,
damage or destruction of the Collateral.

     9.7 No Waiver; Remedies Cumulative. Bank’s failure, at any time or times, to require strict
performance by Borrower of any provision of this Agreement or any other Loan Document shall not
waive, affect, or diminish any right of Bank thereafter to demand strict performance and compliance
herewith or therewith. No waiver hereunder shall be effective unless signed by Bank and then is
only effective for the specific instance and purpose for which it is given. Bank’s rights and
remedies under this Agreement and the other Loan Documents are cumulative. Bank has all rights and
remedies provided under the Code, by law, or in equity. Bank’s exercise of one right or remedy is
not an election, and Bank’s waiver of any Event of Default is not a continuing waiver. Bank’s
delay in exercising any remedy is not a waiver, election, or acquiescence.

     9.8 Demand Waiver. Borrower waives demand, notice of default or dishonor, notice of payment
and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement,
extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by
Bank on which Borrower is liable.

     10 NOTICES

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

			
	If to Borrower:	 	SoundBite Communications, Inc.

22 Crosby Drive

Bedford, Massachusetts 01730

Attn: Chief Financial Officer

Fax: (781) 897-2502

Email: rleahy@soundbite.com

			
	with a copy to:	 	Cooley Godward Kronish LLP

The Prudential Tower

800 Boylston Street, 46th Floor

Boston, Massachusetts 02199

Attn: Mark Johnson, Esquire

Fax: (617) 937-2400 Email: mark.johnson@cooley.com
	 
	If to Bank:	 	Silicon Valley Bank

One Newton Executive Park, Suite 200

2221 Washington Street

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Newton, Massachusetts 02462

Attn: Mr. Philip Silvia

Fax: (617) 969-5962

Email: PSilvia@svb.com

			
	with a copy to:	 	Riemer & Braunstein LLP

Three Center Plaza

Boston, Massachusetts 02108

Attn: David A. Ephraim, Esquire

Fax: (617) 880-3456 

Email: DEphraim@riemerlaw.com

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

     Massachusetts law governs the Loan Documents without regard to principles of conflicts of law.
Borrower and Bank each submit to the exclusive jurisdiction of the State and Federal courts in
Massachusetts; provided, however, that if for any reason Bank cannot avail itself of such courts in
the Commonwealth of Massachusetts, Borrower accepts jurisdiction of the courts and venue in Santa
Clara County, California. NOTWITHSTANDING THE FOREGOING, BANK SHALL HAVE THE RIGHT TO BRING ANY
ACTION OR PROCEEDING AGAINST BORROWER OR ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION WHICH
BANK DEEMS NECESSARY OR APPROPRIATE IN ORDER TO REALIZE ON THE COLLATERAL OR TO OTHERWISE ENFORCE
BANK’S RIGHTS AGAINST BORROWER OR ITS PROPERTY.

TO THE EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND BANK EACH WAIVE THEIR RIGHT TO A JURY TRIAL
OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR
ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS
WAIVER IS A MATERIAL INDUCEMENT FOR BOTH PARTIES TO ENTER INTO THIS AGREEMENT. EACH PARTY HAS
REVIEWED THIS WAIVER WITH ITS COUNSEL.

     12 GENERAL PROVISIONS

     12.1 Successors and Assigns. This Agreement binds and is for the benefit of the successors
and permitted assigns of each party. Borrower may not assign this Agreement or any rights or
obligations under it without Bank’s prior written consent (which may be granted or withheld in
Bank’s discretion). Bank has the right, without the consent of or notice to Borrower, to sell,
transfer, assign, negotiate, or grant participation in all or any part of, or any interest in,
Bank’s obligations, rights, and benefits under this Agreement and the other Loan Documents.

     12.2 Indemnification. Borrower agrees to indemnify, defend and hold Bank and its directors,
officers, employees, agents, attorneys, or any other Person affiliated with or representing Bank
harmless against: (a) all obligations, demands, claims, and liabilities (collectively, “Claims”)
asserted by any other party in connection with the transactions contemplated by the Loan Documents;
and (b) all losses or Bank Expenses incurred, or paid by Bank from, following, or arising from
transactions between Bank and Borrower (including reasonable attorneys’ fees and expenses), except
for Claims and/or losses directly caused by Bank’s gross negligence or willful misconduct.

     12.3 Time of Essence. Time is of the essence for the performance of all Obligations in this
Agreement.

     12.4 Severability of Provisions. Each provision of this Agreement is severable from every
other provision in determining the enforceability of any provision.

     12.5 Amendments in Writing; Integration. All amendments to this Agreement must be in writing
signed by both Bank and Borrower. This Agreement and the Loan Documents represent the entire
agreement about this subject matter and supersede prior negotiations or agreements. All prior
agreements, understandings, representations, warranties, and negotiations between the parties about
the subject matter of this Agreement and the Loan Documents merge into this Agreement and the Loan
Documents.

     12.6 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, is an
original, and all taken together, constitute one Agreement.

     12.7 Survival. All covenants, representations and warranties made in this Agreement continue
in full force until this Agreement has terminated pursuant to its terms and all Obligations (other
than inchoate indemnity obligations and any other obligations which, by their terms, are to survive
the termination of this Agreement) have been satisfied. The obligation of Borrower in Section 12.2
to indemnify Bank shall survive until the statute of limitations with respect to such claim or
cause of action shall have run.

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     12.8 Confidentiality. In handling any confidential information, Bank shall exercise the same
degree of care that it exercises for its own proprietary information, but disclosure of information
may be made: (a) to Bank’s Subsidiaries or Affiliates (provided, however, Bank shall use
commercially reasonable efforts in obtaining such
Subsidiary’s or Affiliate’s agreement to the terms of this provision); (b) to prospective
transferees or purchasers of any interest in the Credit Extensions (provided, however, Bank shall
use commercially reasonable efforts to obtain such prospective transferee’s or purchaser’s
agreement to the terms of this provision); (c) as required by law, regulation, subpoena, or other
order; (d) to Bank’s regulators or as otherwise required in connection with Bank’s examination or
audit; and (e) as Bank considers appropriate in exercising remedies under this Agreement.
Confidential information does not include information that either: (i) is in the public domain or
in Bank’s possession when disclosed to Bank, or becomes part of the public domain after disclosure
to Bank; or (ii) is disclosed to Bank by a third party, if Bank does not know that the third party
is prohibited from disclosing the information.

     12.9 Right of Set Off. Borrower hereby grants to Bank, a lien, security interest and
right of set off as security for all Obligations to Bank, whether now existing or hereafter arising
upon and against all deposits, credits, collateral and property, now or hereafter in the
possession, custody, safekeeping or control of Bank or any entity under the control of Bank
(including a Bank subsidiary) or in transit to any of them. At any time after the occurrence and
during the continuance of an Event of Default, without demand or notice, Bank may set off the same
or any part thereof and apply the same to any liability or obligation of Borrower even though
unmatured and regardless of the adequacy of any other collateral securing the Obligations. ANY AND
ALL RIGHTS TO REQUIRE BANK TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL
WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH
DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY
WAIVED.

     13 DEFINITIONS

     13.1 Definitions. As used in this Agreement, the following terms have the following meanings:

     “Account” is any “account” as defined in the Code with such additions to such term as may
hereafter be made, and includes, without limitation, all accounts receivable and other sums owing
to Borrower.

     “Account Debtor” is any “account debtor” as defined in the Code with such additions to such
term as may hereafter be made.

     “Adjusted Quick Ratio” is the ratio of (a) Quick Assets to (b) Total Liabilities minus
Deferred Revenue.

     “Advance” or “Advances” means an advance (or advances) under the Revolving Line.

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

     “Agreement” is defined in the preamble hereof.

     “Availability Amount” is (a) the lesser of (i) the Revolving Line or (ii) the Borrowing Base
minus (b) the amount of all outstanding Letters of Credit (including drawn but unreimbursed Letters
of Credit) plus an amount equal to the Letter of Credit Reserves, minus (c) the FX Reduction
Amount, and minus (d) the outstanding principal balance of any Advances (including any amounts used
for Cash Management Services).

     “Bank” is defined in the preamble hereof.

     “Bank Expenses” are all audit fees and expenses, costs, and expenses (including reasonable
attorneys’ fees and expenses) for preparing, negotiating, administering, defending and enforcing
the Loan Documents (including, without limitation, those incurred in connection with appeals or
Insolvency Proceedings) or otherwise incurred with respect to Borrower or any Guarantor.

     “Borrower” is defined in the preamble hereof

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     “Borrower’s Books” are all Borrower’s books and records including ledgers, federal and state
tax returns, records regarding Borrower’s assets or liabilities, the Collateral, business
operations or financial condition, and all computer programs or storage or any equipment containing
such information.

     “Borrowing Base” is eighty percent (80.0%) of Eligible Accounts, as determined by Bank from
Borrower’s most recent Borrowing Base Certificate; provided, however, that Bank, upon notice to
Borrower, may decrease the foregoing percentage in its good faith business judgment based on
events, conditions, contingencies, or risks which, as determined by Bank may adversely affect
Collateral.

     “Borrowing Base Certificate” is that certain certificate in the form attached hereto as
Exhibit C.

     “Borrowing Resolutions” are, with respect to any Person, those resolutions adopted by such
Person’s Board of Directors and delivered by such Person to Bank approving the Loan Documents to
which such Person is a party and the transactions contemplated thereby, together with a certificate
executed by its secretary on behalf of such Person certifying that (a) such Person has the
authority to execute, deliver, and perform its obligations under each of the Loan Documents to
which it is a party, (b) that attached as Exhibit A to such certificate is a true, correct, and
complete copy of the resolutions then in full force and effect authorizing and ratifying the
execution, delivery, and performance by such Person of the Loan Documents to which it is a party,
(c) the name(s) of the Person(s) authorized to execute the Loan Documents on behalf of such Person,
together with a sample of the true signature(s) of such Person(s), and (d) that Bank may
conclusively rely on such certificate unless and until such Person shall have delivered to Bank a
further certificate canceling or amending such prior certificate.

     “Business Day” is any day that is not a Saturday, Sunday or a day on which Bank is closed.

     “Cash Equivalents” are (a) marketable direct obligations issued or unconditionally guaranteed
by the United States or any agency or any State thereof having maturities of not more than one (1)
year from the date of acquisition; (b) commercial paper maturing no more than one (1) year after
its creation and having the highest rating from either Standard & Poor’s Ratings Group or Moody’s
Investors Service, Inc.; (c) Bank’s certificates of deposit issued maturing no more than one (1)
year after issue; and (d) money market funds at least ninety-five percent (95%) of the assets of
which constitute Cash Equivalents of the kinds described in clauses (a) through (c) of this
definition.

     “Cash Management Services” is defined in Section 2.1.4.

     “Cash Management Services Sublimit” is defined in Section 2.1.4.

     “Claims” are defined in Section 12.2.

     “Code” is the Uniform Commercial Code, as the same may, from time to time, be enacted and in
effect in the Commonwealth of Massachusetts; provided, that, to the extent that the Code is used to
define any term herein or in any Loan Document and such term is defined differently in different
Articles or Divisions of the Code, the definition of such term contained in Article or Division 9
shall govern; provided further, that in the event that, by reason of mandatory provisions of law,
any or all of the attachment, perfection, or priority of, or remedies with respect to, Bank’s Lien
on any Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than
the Commonwealth of Massachusetts, the term “Code” shall mean the Uniform Commercial Code as
enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof
relating to such attachment, perfection, priority, or remedies and for purposes of definitions
relating to such provisions.

     “Collateral” is any and all properties, rights and assets of Borrower described on Exhibit
A.

     “Collateral Account” is any Deposit Account, Securities Account, or Commodity Account.

     “Commodity Account” is any “commodity account” as defined in the Code with such additions to
such term as may hereafter be made.

     “Communication” is defined in Section 10.

     “Compliance Certificate” is that certain certificate in the form attached hereto as
Exhibit D.

-18-

 

     “Contingent Obligation” is, for any Person, any direct or indirect liability, contingent or
not, of that Person for (a) any indebtedness, lease, dividend, letter of credit or other obligation
of another such as an obligation directly or indirectly guaranteed, endorsed, co-made, discounted
or sold with recourse by that Person, or for which that Person is directly or indirectly liable;
(b) any obligations for undrawn letters of credit for the account of that Person; and (c) all
obligations from any interest rate, currency or commodity swap agreement, interest rate cap or
collar agreement, or other agreement or arrangement designated to protect a Person against
fluctuation in interest
rates, currency exchange rates or commodity prices; but “Contingent Obligation” does not
include endorsements in the ordinary course of business. The amount of a Contingent Obligation is
the stated or determined amount of the primary obligation for which the Contingent Obligation is
made or, if not determinable, the maximum reasonably anticipated liability for it determined by the
Person in good faith; but the amount may not exceed the maximum of the obligations under any
guarantee or other support arrangement.

     “Control Agreement” is any control agreement entered into among the depository institution at
which Borrower maintains a Deposit Account or the securities intermediary or commodity intermediary
at which Borrower maintains a Securities Account or a Commodity Account, Borrower, and Bank
pursuant to which Bank obtains control (within the meaning of the Code) over such Deposit Account,
Securities Account, or Commodity Account.

     “Credit Extension” is any Advance, Letter of Credit, the aggregate FX Reduction Amount, amount
utilized for Cash Management Services, or any other extension of credit by Bank for Borrower’s
benefit.

     “Default” is any event which with notice or passage of time or both, would constitute an Event
of Default.

     “Default Rate” is defined in Section 2.3(b).

     “Deferred Revenue” is all amounts received or invoiced in advance of performance under
contracts and not yet recognized as revenue.

     “Deposit Account” is any “deposit account” as defined in the Code with such additions to such
term as may hereafter be made.

     “Designated Deposit Account” is Borrower’s deposit account, account number ___,
maintained with Bank.

     “Dollars,” “dollars” and “$” each mean lawful money of the United States.

     “Effective Date” is defined in the preamble of this Agreement.

     “Eligible Accounts” are Accounts which arise in the ordinary course of Borrower’s business
that meet all Borrower’s representations and warranties in Section 5.3. Bank reserves the right,
at any time and from time to time after the Effective Date, and upon notice to Borrower, to adjust
any of the criteria set forth below and to establish new criteria in its good faith business
judgment. Unless Bank agrees otherwise in writing, Eligible Accounts shall not include:

     (a) Accounts for which the Account Debtor has not been invoiced;

     (b) Accounts that the Account Debtor has not paid within ninety (90) days of invoice date;

     (c) Accounts owing from an Account Debtor, fifty percent (50%) or more of whose Accounts have
not been paid within one hundred twenty days (120) days of invoice date;

     (d) Accounts with credit balances over one hundred twenty (120) days from invoice date;

     (e) Accounts owing from an Account Debtor, including Affiliates, whose total obligations to
Borrower exceed twenty-five percent (25%) of all Accounts, for the amounts that exceed that
percentage, unless Bank approves in writing; provided that with respect to the Accounts of NCO,
such percentage shall be thirty-five percent (35%);

-19-

 

     (f) Accounts owing from an Account Debtor which does not have its principal place of business
in the United States;

     (g) Accounts owing from an Account Debtor which is a federal, state or local government entity
or any department, agency, or instrumentality thereof;

     (i) Accounts owing from an Account Debtor to the extent that Borrower is indebted or obligated
in any manner to the Account Debtor (as creditor, lessor, supplier or otherwise — sometimes called
“contra” accounts,
accounts payable, customer deposits or credit accounts), with the exception of customary
credits, adjustments and/or discounts given to an Account Debtor by Borrower in the ordinary course
of its business;

     (j) Accounts for demonstration or promotional equipment, or in which goods are consigned, or
sold on a “sale guaranteed”, “sale or return”, “sale on approval”, “bill and hold”, or other terms
if Account Debtor’s payment may be conditional;

     (k) Accounts for which the Account Debtor is Borrower’s Affiliate, officer, employee, or
agent;

     (l) Accounts in which the Account Debtor disputes liability or makes any claim (but only up to
the disputed or claimed amount), or if the Account Debtor is subject to an Insolvency Proceeding,
or becomes insolvent, or goes out of business;

     (m) Accounts owing from an Account Debtor with respect to which Borrower has received Deferred
Revenue (but only to the extent of such deferred revenue);

     (n) Accounts for which Bank in its good faith business judgment determines collection to be
doubtful; and

     (o) other Accounts Bank deems ineligible, after consultation with Borrower, in the exercise of
its good faith business judgment.

     “Equipment” is all “equipment” as defined in the Code with such additions to such term as may
hereafter be made, and includes without limitation all machinery, fixtures, goods, vehicles
(including motor vehicles and trailers), and any interest in any of the foregoing.

     “ERISA” is the Employee Retirement Income Security Act of 1974, and its regulations.

     “Event of Default” is defined in Section 8.

     “Event of Loss” is defined in Section 2.1.5(c).

     “Foreign Currency” means lawful money of a country other than the United States.

     “Funding Date” is any date on which a Credit Extension is made to or on account of Borrower
which shall be a Business Day.

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

     “FX Forward Contract” is defined in Section 2.1.3.

     “FX Reserve” is defined in Section 2.1.3.

     “GAAP” is generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other Person as may be approved by a significant segment of the
accounting profession, which are applicable to the circumstances as of the date of determination.

-20-

 

     “General Intangibles” is all “general intangibles” as defined in the Code in effect on the
date hereof with such additions to such term as may hereafter be made, and includes without
limitation, all copyright rights, copyright applications, copyright registrations and like
protections in each work of authorship and derivative work, whether published or unpublished, any
patents, trademarks, service marks and, to the extent permitted under applicable law, any
applications therefor, whether registered or not, any trade secret rights, including any rights to
unpatented inventions, payment intangibles, royalties, contract rights, goodwill, franchise
agreements, purchase orders, customer lists, route lists, telephone numbers, domain names, claims,
income and other tax refunds, security and other deposits, options to purchase or sell real or
personal property, rights in all litigation presently or hereafter pending (whether in contract,
tort or otherwise), insurance policies (including without limitation key man, property damage, and
business interruption insurance), payments of insurance and rights to payment of any kind.

     “Guarantor” is any present or future guarantor of the Obligations, including, without
limitation, SoundBite Communications Securities Corporation.

     “Indebtedness” is (a) indebtedness for borrowed money or the deferred price of property or
services, such as reimbursement and other obligations for surety bonds and letters of credit, (b)
obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease
obligations, and (d) Contingent Obligations.

     “Insolvency Proceeding” is any proceeding by or against any Person under the United States
Bankruptcy Code, or any other bankruptcy or insolvency law, including assignments for the benefit
of creditors, compositions, extensions generally with its creditors, or proceedings seeking
reorganization, arrangement, or other relief.

     “Inventory” is all “inventory” as defined in the Code in effect on the date hereof with such
additions to such term as may hereafter be made, and includes without limitation all merchandise,
raw materials, parts, supplies, packing and shipping materials, work in process and finished
products, including without limitation such inventory as is temporarily out of Borrower’s custody
or possession or in transit and including any returned goods and any documents of title
representing any of the above.

     “Investment” is any beneficial ownership interest in any Person (including stock, partnership
interest or other securities), and any loan, advance or capital contribution to any Person.

     “Letter of Credit” means a standby letter of credit issued by Bank or another institution
based upon an application, guarantee, indemnity or similar agreement on the part of Bank as set
forth in Section 2.1.2.

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

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

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

     “Loan Documents” are, collectively, this Agreement, the Perfection Certificate, any
subordination agreements, any note, or notes or guaranties executed by Borrower or any Guarantor,
and any other present or future agreement between Borrower any Guarantor and/or for the benefit of
Bank in connection with this Agreement, all as amended, restated, or otherwise modified.

     “Material Adverse Change” is (a) a material impairment in the perfection or priority of Bank’s
Lien in the Collateral or in the value of such Collateral; (b) a material adverse change in the
business, operations, or condition (financial or otherwise) of Borrower; (c) a material impairment
of the prospect of repayment of any portion of the Obligations; or (d) Bank determines, based upon
information available to it and in its reasonable judgment, that there is a substantial likelihood
that Borrower shall fail to comply with one or more of the financial covenants in Section 6 during
the next succeeding financial reporting period.

     “Material Indebtedness” is any Indebtedness the principal amount of which is equal to or
greater than One Million Dollars ($1,000,000.00).

     “Obligations” are Borrower’s obligation to pay when due any debts, principal, interest, Bank
Expenses and other amounts Borrower owes Bank now or later, whether under this Agreement, the Loan
Documents, including, without limitation, all obligations relating to letters of credit (including
reimbursement obligations for

-21-

 

drawn and undrawn letters of credit), cash management services, and
foreign exchange contracts, if any, and
including interest accruing after Insolvency Proceedings begin and the performance of
Borrower’s duties under the Loan Documents.

     “Operating Documents” are, for any Person, such Person’s formation documents, as certified
with the Secretary of State of such Person’s state of formation on a date that is no earlier than
thirty (30) days prior to the Effective Date, and, its bylaws in current form, each of the
foregoing with all current amendments or modifications thereto.

     “Payment/Advance Form” is that certain form attached hereto as Exhibit B.

     “Perfection Certificate” is defined in Section 5.1.

     “Permitted Distributions” means:

     (a) purchases of capital stock from former employees, consultants and directors pursuant to
repurchase agreements or other similar agreements in an aggregate amount not to exceed Two Hundred
Fifty Thousand Dollars ($250,000.00) in any fiscal year provided that at the time of such purchase
no Default or Event of Default has occurred and is continuing;

     (b) distributions or dividends consisting solely of Borrower’s capital stock;

     (c) purchases for value of any rights distributed in connection with any stockholder rights
plan;

     (d) purchases of capital stock or options to acquire such capital stock with the proceeds
received from a substantially concurrent issuance of capital stock or convertible securities;

     (e) purchases of capital stock pledged as collateral for loans to employees;

     (f) purchases of capital stock in connection with the exercise of stock options or stock
appreciation rights by way of cashless exercise or in connection with the satisfaction of
withholding tax obligations;

     (g) purchases of fractional shares of capital stock arising out of stock dividends, splits or
combinations or business combinations; and

     (h) the settlement or performance of such Person’s obligations under any equity derivative
transaction, option contract or similar transaction or combination of transactions.

     “Permitted Indebtedness” is:

     (a) Borrower’s Indebtedness to Bank under this Agreement and the other Loan Documents;

     (b) Indebtedness existing on the Effective Date and shown on the Perfection Certificate;

     (c) Subordinated Debt;

     (d) unsecured Indebtedness to trade creditors incurred in the ordinary course of business;

     (e) Indebtedness secured by Liens permitted under clause (c) of the definition of Permitted
Liens; and

     (f) extensions, refinancings, modifications, amendments and restatements of any items of
Permitted Indebtedness (a) through (e) above, provided that the principal amount thereof is not
increased or the terms thereof are not modified to impose more burdensome terms upon Borrower or
its Subsidiary, as the case may be.

     “Permitted Investments” are:

     (a) Investments shown on the Perfection Certificate and existing on the Effective Date;

-22-

 

     (b) Investments consisting of (i) travel advances and employee relocation loans and other
employee loans and advances in the ordinary course of business, and (ii) loans to employees,
officers or directors relating to
the purchase of equity securities of Borrower or its Subsidiaries pursuant to employee stock
purchase plans or agreements approved by Borrower’s Board of Directors; and

     (c) Cash Equivalents.

     “Permitted Liens” are:

     (a) Liens existing on the Effective Date and shown on the Perfection Certificate or arising
under this Agreement and the other Loan Documents;

     (b) Liens for taxes, fees, assessments or other government charges or levies, either not
delinquent or being contested in good faith and for which Borrower maintains adequate reserves on
Borrower’s Books, if they have no priority over any of Bank’s Liens;

     (c) purchase money Liens (i) on Equipment acquired or held by Borrower incurred for financing
the acquisition of the Equipment securing no more than One Million Dollars ($1,000,000.00) in the
aggregate amount outstanding, or (ii) existing on Equipment when acquired, if the Lien is
confined to the property and improvements and the proceeds of the Equipment; and

     (d) Leases or subleases and non-exclusive licenses or sublicenses granted in the ordinary
course of Borrower’s business, if the leases, subleases, licenses and sublicenses do not prohibit
granting Bank a security interest;

     (e) Mechanic’s Liens arising in the ordinary course of business and which are not delinquent
for more than thirty (30) days or are being contested in good faith by appropriate proceedings,
provided they have no priority over any of Bank’s Liens and the aggregate amount of the
Indebtedness secured by such Liens does not exceed Two Hundred Fifty Thousand Dollars ($250,000.00)
in the aggregate;

     (f) Liens in favor of other financial institutions arising in connection with Borrower’s
deposit and/or securities accounts held at such institutions, provided that Bank has a perfected
security interest in the amounts held in such deposit and/or securities accounts;

     (g) Liens arising from judgments, decrees or attachments in circumstances not constituting an
Event of Default;

     (h) Security deposits with Borrower’s or Borrower’s Subsidiary’s landlord;

     (i) Deposits or pledges to secure the performance of bids, tenders, contracts, public or
statutory obligations, surety, stay, appeal, indemnity, performance or other similar bonds or
similar obligations arising in the ordinary course of business; and

     (j) Liens incurred in the extension, renewal or refinancing of the indebtedness secured by
Liens described in (a) through (i), but any extension, renewal or replacement Lien must be
limited to the property encumbered by the existing Lien and the principal amount of the
indebtedness may not increase.

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

     “Prime Rate” is Bank’s most recently announced “prime rate,” even if it is not Bank’s lowest
rate.

     “Quick Assets” is, on any date, Borrower’s unrestricted cash, Eligible Accounts, and
investments with maturities of fewer than twelve (12) months determined according to GAAP.

     “Registered Organization” is any “registered organization” as defined in the Code with such
additions to such term as may hereafter be made

-23-

 

     “Responsible Officer” is any of the Chief Executive Officer, President, Chief Financial
Officer and Controller of Borrower.

     “Revolving Line” is an Advance or Advances in an aggregate amount of up to One Million Five
Hundred Thousand Dollars ($1,500,000.00) outstanding at any time.

     “Revolving Line Maturity Date” is November 1, 2010.

     “Securities Account” is any “securities account” as defined in the Code with such additions to
such term as may hereafter be made.

     “Security Agreement” is that certain Security Agreement entered into between Bank and
SoundBite Communications Securities Corporation dated as of the Effective Date.

     “Settlement Date” is defined in Section 2.1.3.

     “Subordinated Debt” is indebtedness incurred by Borrower subordinated to all of Borrower’s now
or hereafter indebtedness to Bank (pursuant to a subordination, intercreditor, or other similar
agreement in form and substance satisfactory to Bank entered into between Bank and the other
creditor), on terms acceptable to Bank.

     “Subsidiary” is, with respect to any Person, any Person of which more than 50% of the voting
stock or other equity interests (in the case of Persons other than corporations) is owned or
controlled, directly or indirectly, by such Person or one or more Affiliates of such Person.

     “Total Liabilities” is on any day, obligations that should, under GAAP, be classified as
liabilities on Borrower’s consolidated balance sheet, including all Indebtedness.

     “Transfer” is defined in Section 7.1.

     “Unconditional Guaranty” is that certain Unconditional Guaranty entered into by SoundBite
Communications Securities Corporation in favor of Bank dated as of the Effective Date.

[Signature page follows.]

-24-

 

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as a sealed
instrument under the laws of the Commonwealth of Massachusetts as of the Effective Date.

	 	 	 	 	 
	BORROWER:

SOUNDBITE COMMUNICATIONS, INC.

 	 	 
	By:  	/s/ Robert C. Leahy
 	 	 
	 	Name:  	Robert C. Leahy 	 	 
	 	Title:  	Chief Operating Officer and Chief Financial Officer 	 	 
	 
	BANK:

SILICON VALLEY BANK

 	 	 
	By:  	/s/ Philip Silvia
 	 	 
	 	Name:  	Philip Silvia 	 	 
	 	Title:  	Vice President 	 	 
	 

[Signature
page to Loan and Security Agreement]

 

EXHIBIT A

The Collateral consists of all of Borrower’s right, title and interest in and to the following
personal property:

     All goods, Accounts (including health-care receivables), Equipment, Inventory, contract rights
or rights to payment of money, leases, license agreements, franchise agreements, General
Intangibles (except as provided below), commercial tort claims, documents, instruments (including
any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts,
certificates of deposit, fixtures, letters of credit rights (whether or not the letter of credit is
evidenced by a writing), securities, and all other investment property, supporting obligations, and
financial assets, whether now owned or hereafter acquired, wherever located; and

     all Borrower’s Books relating to the foregoing, and any and all claims, rights and interests
in any of the above and all substitutions for, additions, attachments, accessories, accessions and
improvements to and replacements, products, proceeds and insurance proceeds of any or all of the
foregoing.

     Notwithstanding the foregoing, the Collateral does not include any of the following, whether
now owned or hereafter acquired: (a) any copyright rights, copyright applications, copyright
registrations and like protections in each work of authorship and derivative work, whether
published or unpublished, any patents, patent applications and like protections, including
improvements, divisions, continuations, renewals, reissues, extensions, and continuations-in-part
of the same, trademarks, service marks and, to the extent permitted under applicable law, any
applications therefor, whether registered or not, and the goodwill of the business of Borrower
connected with and symbolized thereby, know-how, operating manuals, trade secret rights, rights to
unpatented inventions, and any claims for damage by way of any past, present, or future
infringement of any of the foregoing; provided, however, the Collateral shall include all Accounts,
license and royalty fees and other revenues, proceeds, or income arising out of or relating to any
of the foregoing, and (b) Equipment financed by Oracle prior to the Effective Date (provided,
however, such Equipment shall be part of the Collateral if at any time Oracle no longer has a
security interest in such Equipment).

     Pursuant to the terms of a certain negative pledge arrangement with Bank, Borrower has agreed
not to encumber any of its copyright rights, copyright applications, copyright registrations and
like protections in each work of authorship and derivative work, whether published or unpublished,
any patents, patent applications and like protections, including improvements, divisions,
continuations, renewals, reissues, extensions, and continuations-in-part of the same, trademarks,
service marks and, to the extent permitted under applicable law, any applications therefor, whether
registered or not, and the goodwill of the business of Borrower connected with and symbolized
thereby, know-how, operating manuals, trade secret rights, rights to unpatented inventions, and any
claims for damage by way of any past, present, or future infringement of any of the foregoing,
without Bank’s prior written consent.

1

 

EXHIBIT B

Loan Payment/Advance Request Form

Deadline for same day processing is Noon E.S.T.*

			
	Fax To:
	 	Date:                     

LOAN PAYMENT:

SoundBite Communications, Inc.

	 	 	 
	From Account #                                                    

	 	To Account #                                                                
            
    

	                                       (Deposit Account #)

	 	(Loan Account #)

	Principal $                                                             

	 	and/or Interest $                                                                 
           
	 
	Authorized Signature:                                       

	 	        Phone Number:                                                                  
     
	Print Name/Title:                                                   
	 	 

Loan Advance:

Complete Outgoing Wire Request section below if all or a portion of the funds from this loan
advance are for an outgoing wire.

	 	 	 
	From Account #                                                    

	 	To Account #                                                                       
           
	(Loan Account #)

	 	(Deposit Account #)

Amount of Advance $                                          

All Borrower’s representations and warranties in the Loan and Security Agreement are true, correct
and complete in all material respects on the date of the request for an advance; provided, however,
that such materiality qualifier shall not be applicable to any representations and warranties that
already are qualified or modified by materiality in the text thereof; and provided, further that
those representations and warranties expressly referring to a specific date shall be true, accurate
and complete in all material respects as of such date:

	 	 	 
	Authorized Signature:                                         

	 	Phone Number:                                                                         
      
	Print Name/Title:                                                  
	 	 

Outgoing Wire Request:

Complete only if all or a portion of funds from the loan advance above is to be wired.

Deadline for same day processing is noon, E.S.T.

	 	 	 
	Beneficiary Name:                                               

	 	Amount of Wire: $                                                                      
	Beneficiary Bank:                                               

	 	Account Number:                                                                       
	City and State:                                                     
	 	 
	 
	Beneficiary Bank Transit (ABA) #:                     

	 	Beneficiary Bank Code (Swift, Sort, Chip, etc.):                     
	 

	 	(For International Wire Only)

	 
	Intermediary Bank:                                                 

	 	Transit (ABA) #:                                                                       
	For Further Credit to:                                                                      
                                                                                     
          
	 
	Special Instruction:                                                                      
                  
                                                                        
       

By signing below, I (we) acknowledge and agree that my (our) funds transfer request shall be
processed in accordance with and subject to the terms and conditions set forth in the agreements(s)
covering funds transfer service(s), which agreements(s) were previously received and executed by me
(us).

 

			
	 	 	 

1

 

	 	 	 
	Authorized Signature:                                         

	 	2nd Signature (if required):                                               
	Print Name/Title:                                                  

	 	Print Name/Title:                                                                
	Telephone #:                                                        

	 	Telephone #:                                                                      

2

 

EXHIBIT C

BORROWING BASE CERTIFICATE

Borrower: SoundBite Communications, Inc.

Lender: Silicon Valley Bank

Commitment Amount: $1,500,000.00

	 	 	 	 	 	 	 
	ACCOUNTS RECEIVABLE	 	 	 	 
	1.	 	Accounts Receivable Book Value as of ____________________
	 	$	 	 
	 	 	 
	 	 	 	 
	2.	 	Additions (please explain on reverse)
	 	$	 	 
	 	 	 
	 	 	 	 
	3.	 	TOTAL ACCOUNTS RECEIVABLE
	 	$	 	 
	 	 	 
	 	 	 	 
	 	 	 
	 	 	 	 
	ACCOUNTS RECEIVABLE DEDUCTIONS (without duplication)	 	 	 	 
	4.	 	Amounts over 90 days due
	 	$	 	 
	 	 	 
	 	 	 	 
	5.	 	Balance of 50% over 120 day accounts
	 	$	 	 
	 	 	 
	 	 	 	 
	6.	 	Credit balances over 90 days
	 	$	 	 
	 	 	 
	 	 	 	 
	7.	 	Concentration Limits
	 	$	 	 
	 	 	 
	 	 	 	 
	8.	 	Foreign Accounts
	 	$	 	 
	 	 	 
	 	 	 	 
	9.	 	Governmental Accounts
	 	$	 	 
	 	 	 
	 	 	 	 
	10.	 	Contra Accounts
	 	$	 	 
	 	 	 
	 	 	 	 
	11.	 	Promotion or Demo Accounts
	 	$	 	 
	 	 	 
	 	 	 	 
	12.	 	Intercompany/Employee Accounts
	 	$	 	 
	 	 	 
	 	 	 	 
	13.	 	Disputed Accounts
	 	$	 	 
	 	 	 
	 	 	 	 
	14.	 	Deferred Revenue
	 	$	 	 
	 	 	 
	 	 	 	 
	15.	 	Other (please explain on reverse)
	 	$	 	 
	 	 	 
	 	 	 	 
	16.	 	TOTAL ACCOUNTS RECEIVABLE DEDUCTIONS
	 	$	 	 
	 	 	 
	 	 	 	 
	17.	 	Eligible Accounts (#3 minus #16)
	 	$	 	 
	 	 	 
	 	 	 	 
	18.	 	ELIGIBLE AMOUNT OF ACCOUNTS (80.0% of #17)
	 	$	 	 
	 	 	 
	 	 	 	 
	 	 	 
	 	 	 	 
	BALANCES	 	 	 	 
	19.	 	Maximum Loan Amount
	 	$	 	 
	 	 	 
	 	 	 	 
	20.	 	Total Funds Available (Lesser of #19 or #18)
	 	$	 	 
	 	 	 
	 	 	 	 
	21.	 	Present balance owing on Line of Credit
	 	$	 	 
	 	 	 
	 	 	 	 
	22.	 	Outstanding under Sublimits
	 	 	 	 
	23.	 	RESERVE POSITION (#20 minus #21 and #22)
	 	$	 	 
	 	 	 
	 	 	 	 

The undersigned represents and warrants for and on behalf of the Borrower that this is true,
complete and correct, and that the information in this Borrowing Base Certificate complies with the
representations and warranties in the Loan and Security Agreement between the undersigned and
Silicon Valley Bank.

	 	 	 	 	 	 	 	 	 
	 	 	 	 	BANK USE ONLY

	 	 
	COMMENTS:	 	 	 	Received by: __________________________	 	 
	 

	 	 
	 	 	 	AUTHORIZED SIGNER
	 	 
	 	 	 	 	Date: ________________________________	 	 
	By: ________________________________	 	 	 	Verified: ______________________________	 	 
	       Authorized Signer

	 	 
	 	 	 	AUTHORIZED SIGNER
	 	 
	Date: ____________________________	 	 	 	Date: _______________________________	 	 
	 	 	 	 	Compliance Status:          Yes          No	 	 

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EXHIBIT D

COMPLIANCE CERTIFICATE

			
	 	 	 
	TO:           SILICON VALLEY BANK 

FROM:     SOUNDBITE COMMUNICATIONS, INC.
	 	Date:                                         

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

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

	 	 	 	 	 
	Reporting Covenant	 	Required	 	Complies
	 
	 	 	 	 
	Compliance Certificate

	 	Within five (5) days of filing 10-Q with
SEC,
but no later than 45 days after quarter end
	 	Yes    No
	Borrowing Base Certificate with A/R and A/P agings

	 	Monthly within 30 days, when Advances are
outstanding or have been requested under
Section 2.1.1
	 	Yes    No
	Board Projections

	 	Annually and within 45 days of approval
	 	Yes    No
	10-Q

	 	Within five (5) days of filing with SEC,
but no later than 45 days after quarter end
	 	Yes    No
	8-K

	 	Within five (5) days of filing with SEC
	 	Yes    No
	10-K, together with an unqualified opinion

	 	Within five (5) days of filing with SEC,
but no later than 45 days after year end
	 	Yes    No

	 	 	 	 	 	 	 
	Financial Covenant	 	Required	 	Actual	 	Complies
	Maintain on a Quarterly Basis:
	 	 	 	 	 	 
	Adjusted Quick Ratio

	 	    2.0:1.0
	 	   ______:1.0
	 	Yes    No
	Minimum Quarterly Net Revenue

	 	$                    *
	 	$                    
	 	Yes    No

 

			
	*	 	As set forth in Section 6.7(b) of the Agreement.

1

 

     The following financial covenant analyses and information set forth in Schedule 1 attached
hereto are true and accurate as of the date of this Certificate.

     The following are the exceptions with respect to the certification above: (If no exceptions
exist, state “No exceptions to note.”)

      

      

      

	 	 	 	 	 
	SoundBite Communications, Inc.	 	BANK USE ONLY
	 
	 	 	 	 
	By:

	 	 	 	Received by:                                                  
	 

	 	 	 
	 	Name:

	 	 	AUTHORIZED SIGNER

	 

	 	 	 	 
	 	Title:

	 	 	
Date:                                                               
	 

	 	 	 	 
	 
	 

	 	 	 	
Verified:                                                         
	 

	 	 	 	AUTHORIZED SIGNER

	 

	 	 	 	
Date:                                                              
	 
	 	 	 	 
	 

	 	 	 	Compliance Status:     Yes     No

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Schedule 1 to Compliance Certificate

Financial Covenants of Borrower

Dated:                                         

In the event of a conflict between this Schedule and the Loan Agreement, the terms of the Loan
Agreement shall control.

I.      Adjusted Quick Ratio (Section 6.7(a))

Required:        2.0:1.0

Actual:            ___:1.0

					
	 	 	 	 	 
	 
	 	                     No, not in compliance
	 	                     Yes, in compliance

II.     Minimum Quarterly Net Revenue (Section 6.7(b))

Required:       Greater of $9,000,000.00, and 75% of Board-approved operating plan

Actual:           $                    

					
	 	 	 	 	 
	 
	 	                     No, not in compliance
	 	                     Yes, in compliance

1114184-7

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