Atheros Communications (ATHR)

9. Bank Loan and Security Agreement

The Company’s loan agreement (the “Agreement”) currently expires in March 2008 and provides the Company with a revolving line of credit facility of up to $10,000,000 to fund working capital requirements. Borrowings under the Agreement are secured by all of the tangible assets of the Company. The amended Agreement contains certain financial and non-financial covenants. The Company was in compliance with these covenants at December 31, 2007. Interest on any borrowings is payable monthly and is calculated at the bank’s prime rate (7.25% at December 31, 2007). Borrowings under this line are due March 28, 2008. During 2006, the Company issued a standby letter of credit for $1,400,000 to secure an operating lease for equipment. This standby letter of credit amount was reduced to $992,000 in September 2007 per a scheduled decrease.

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9. Bank Loan and Security Agreement

9. Bank Loan and Security Agreement

During 2003, the Company entered into a loan agreement (the “Agreement”) with a bank which allowed the Company to finance up to $10,000,000 of working capital requirements (subject to certain limitations) and $2,000,000 of equipment purchases. At December 31, 2004 there were no balances outstanding. The Agreement was originally due to terminate in March 2003 but has been subsequently amended and renewed on an annual basis. The amended Agreement, which currently expires in March 2007, provides the Company with a revolving line of credit facility of up to $10,000,000 to fund working capital requirements. Borrowings under the amended Agreement are secured by all of the tangible assets of the Company. The amended Agreement contains certain financial and non-financial covenants. Interest on any borrowings is payable monthly and is calculated at the bank’s prime rate (8.25% at December 31, 2006). Borrowings under this line are due March 28, 2007. During 2006, the Company issued a standby letter of credit for $1,400,000 to secure an operating lease for equipment which reduced the amount available to borrow under this credit facility from $10,000,000 to $8,600,000. The Company made no other draw downs on the line of credit during 2006.

6. Bank Loan and Security Agreement

During 2003, the Company entered into a loan agreement (the “Agreement”) with a bank which allowed the Company to finance up to $10,000,000 of working capital requirements (subject to certain limitations) and

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ATHEROS COMMUNICATIONS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

$2,000,000 of equipment purchases. In 2003 the Company borrowed $4,000,000 and $1,837,000 under the working capital and equipment purchase arrangements, respectively. The Company repaid all amounts in full, in February 2004, so that at December 31, 2004 there were no balances outstanding. The Agreement was originally due to terminate in March 2003 but has been subsequently amended and renewed on an annual basis. The amended Agreement, which currently expires in March 2006, provides the Company with a revolving line of credit facility of up to $10,000,000 to fund working capital requirements. Borrowings under the amended Agreement are secured by all of the tangible assets of the Company. The amended Agreement contains certain financial and non-financial covenants. Interest on any borrowings is payable monthly and is calculated at the bank’s prime rate (7.25% at December 31, 2005). Borrowings under this line are due March 29, 2006. The Company did not draw down on the line of credit during 2005, and at December 31, 2005 the Company had $10,000,000 available for borrowing.

Bank Loan and Security Agreement

In March 2005, the Company amended its existing loan agreement (the “Agreement”) with a bank. The Agreement allows the Company to finance up to $10,000,000 of working capital requirements. Borrowings under the Agreement are secured by all of the tangible assets of the Company. The Agreement contains financial covenants related to cash and cash equivalents and marketable securities on hand, as well as other non-financial covenants. Interest on borrowings under the working capital line is payable monthly and is calculated at the bank’s prime rate (6.75% at September 30, 2005). Borrowings under the line are due in March 2006, or earlier as required by borrowing limits defined in the Agreement. No balances were outstanding as of September 30, 2005 under the Agreement.

Bank Loan and Security Agreement

In March 2005, the Company amended its existing loan agreement (the “Agreement”) with a bank. The Agreement allows the Company to finance up to $10,000,000 of working capital requirements. Borrowings under the Agreement are secured by all of the tangible assets of the Company. The Agreement contains financial covenants related to cash and cash equivalents and marketable securities on hand, as well as other non-financial covenants. Interest on borrowings under the working capital line is payable monthly and is calculated at the bank’s prime rate (6.25% at June 30, 2005). Borrowings under the line are due in March 2006, or earlier as required by borrowing limits defined in the Agreement. No balances were outstanding as of June 30, 2005 under the Agreement.

Bank Loan and Security Agreement

In March 2005, the Company amended its existing loan agreement (the “Agreement”) with a bank. The Agreement allows the Company to finance up to $10,000,000 of working capital requirements. Borrowings under the Agreement are secured by all of the tangible assets of the Company. The Agreement contains financial covenants related to cash and cash equivalents and marketable securities on hand, as well as other non-financial covenants. As of March 31, 2005, the Company was in compliance with all required covenants. Interest on borrowings under the working capital line is payable monthly and is calculated at the bank’s prime rate (5.75% at March 31, 2005). Borrowings under the line are due in March 2006, or earlier as required by borrowing limits defined in the Agreement. No balances were outstanding as of March 31, 2005 under the agreement.

Bank Loan and Security Agreement

The Company’s loan agreement with a bank (the “Agreement”) allows the Company to finance up to $10,000,000 of working capital requirements (subject to certain limitations) and $2,000,000 of equipment purchases. Borrowings under the Agreement are secured by all of the tangible assets of the Company. The Agreement contains certain financial and nonfinancial covenants. Interest on borrowings under the working capital line is payable monthly and is calculated at the bank’s prime rate (5.25% at December 31, 2004) plus 1.0%. Borrowings under the working capital line are due in March 2005, or earlier as required by borrowing limits defined in the Agreement. Principal and interest is payable monthly for borrowings related to equipment purchases.

At December 31, 2003, $4,000,000 and $1,837,000 was outstanding under the working capital and equipment purchase arrangements, respectively. In February 2004, the Company repaid these balances in full and no balances were outstanding at December 31, 2004. The Company had $10,000,000 available for borrowing under the working capital arrangement and no further funds available for borrowing under the equipment purchase arrangement at December 31, 2004.