Exhibit 10.31

This Secured Promissory Note (this “Note”) shall not be sold, offered for sale,
pledged, or hypothecated except as permitted herein. Any attempted transfer of
this Note in violation of such terms shall be null and void and of no effect.
This Note has not been registered under the Securities Act of 1933, as amended
(the “Securities Act”), and may not be sold unless (i) a registration statement
under the Securities Act is in effect therefor or the Borrower has received an
opinion of counsel to the effect that registration is not required under the
Securities Act in connection with such sale or (ii) it is sold in accordance
with Rule 144 promulgated under the Securities Act.

RMI CORPORATION

SECURED PROMISSORY NOTE

 

$15,000,000.00    May 31, 2009

FOR VALUE RECEIVED, the undersigned, RMI CORPORATION, a Delaware corporation
(the “Borrower”), promises to pay to the order of NETLOGIC MICROSYSTEMS, INC., a
Delaware corporation (“Lender”), or each of its respective assigns and
successors, the aggregate principal amount of Fifteen Million and No/100 Dollars
($15,000,000.00), together with accrued and unpaid interest thereon and any
other amount owed pursuant to the terms of this Note from the date hereof as
provided herein.

1. Payment on the Maturity Date. The Borrower shall pay to Lender on the
Maturity Date in full in cash all of the aggregate unpaid principal amount of
the indebtedness evidenced by this Note then outstanding, together with all
accrued but unpaid interest thereon and any other amount owed hereunder.

2. Interest Rate. Except as expressly provided in Section 3.2(a) hereof, this
Note shall bear interest daily at the Applicable Interest Rate on the principal
indebtedness evidenced by this Note outstanding from the date of this Note until
the Maturity Date or the date upon which the principal indebtedness evidenced by
this Note otherwise becomes due and payable (whether by demand or otherwise).
Interest shall be calculated on the basis of three hundred sixty (360) day year
for the actual number of days elapsed in the period during which it accrues.

3. Default.

3.1 Definition. For purposes of this Note, an Event of Default shall be deemed
to have occurred if any one of the following events shall have occurred:

(a) the Borrower fails to pay when due and payable (whether at the Maturity Date
or otherwise) the full amount of any principal payment or interest payment on
the Note;

(b) an event of default has occurred and is continuing under any other debt
instrument of Borrower (including, without limitation, the Pre-Existing Loan
Agreements) evidencing debt resulting in the acceleration of the maturity of
such indebtedness in an amount in

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excess of $500,000; provided, however, that such event of default under this
clause (b) caused by the occurrence of a default under such other indebtedness
shall be cured or waived for purposes of this Agreement upon Lender receiving
written notice from the party asserting such default under such other agreement,
if, at the time of such cure or waiver under such other agreement, (a) Lender
has not declared an Event of Default hereunder and/or exercised any rights with
respect thereto; (b) any such cure or waiver does not result in an Event of
Default under any other provision of this Agreement; and (c) in connection with
any such cure or waiver under such agreement, the terms of any agreement with
such third party are not modified or amended in any manner which could in the
good faith judgment of Lender be materially less advantageous to any Loan Party;

(c) other than with respect to any covenant or provision which is the subject of
clause (d) below, any Loan Party shall fail or neglect to perform, keep or
observe any affirmative covenant or material provision contained herein or in
any Loan Document, respectively, on the date that any Loan Party is required to
perform, keep or observe such covenant or provision and shall permit the
continuance of such failure for 10 days; provided, however, that if the default
cannot by its nature be cured within the 10 day period or cannot after diligent
attempts by the Borrower be cured within such 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 30 days) to attempt to
cure such default, and within such reasonable time period the failure to cure
the default shall not be deemed to be an Event of Default);

(d) any Loan Party shall fail or neglect to perform, keep or observe any
negative covenant or provision contained herein or in any Loan Document,
respectively, on the date that any Loan Party is required to perform, keep or
observe such covenant or provision;

(e) (i) any Loan Document or any provision thereof shall cease to be in full
force and effect, or shall cease to give Lender Liens, rights, powers and
privileges purported to be created thereby in favor of Lender, or (ii) any Liens
granted in any of the Collateral in favor of Lender shall be void, voidable, or
invalid, or (iii) any involuntary Lien (other than any such Lien which is
otherwise permitted pursuant to Section 7 hereof) shall attach to any asset or
property of any Loan Party or the Collateral which is not discharged within
sixty (60) days after such attachment or within thirty (30) days after notice
from Lender, whichever occurs first; or (iv) any Loan Party shall cease
operations of its present business without the prior written consent of Lender;
or (v) any condition exists or event occurs which has resulted in a Material
Adverse Effect;

(f) any Loan Party makes an assignment for the benefit of creditors or admits in
writing its inability to pay its debts generally as they become due; or an
order, judgment or decree is entered adjudicating any Loan Party bankrupt or
insolvent; or any order for relief with respect to any Loan Party is entered
under the Federal Bankruptcy Code; or any Loan Party petitions or applies to any
tribunal for the appointment of a custodian, trustee, receiver or liquidator of
any Loan Party or of any substantial part of the assets of any Loan Party, or
commences any proceeding relating to any Loan Party under any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation law of any jurisdiction;

 

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or any such petition or application is filed, or any such proceeding is
commenced, against any Loan Party and either (a) any Loan Party, as applicable,
by any act indicates its approval thereof, consent thereto or acquiescence
therein or (b) such petition, application or proceeding is not dismissed within
45 days;

(g) any portion of Borrower’s assets is attached or seized, or a levy is filed
against any such assets, or a judgment or judgments is/are entered for the
payment of money, individually or in the aggregate, of at least $500,000, or
Borrower is enjoined or in any way prevented by court order from conducting any
material part of its business;

(h) any material representation or material warranty made by any Loan Party in
any Loan Document or in any certificate, document, financial or other written
statement furnished at any time by any Loan Party as required pursuant hereto or
thereto shall prove to have been misleading in any material respect on the date
when made or deemed to have been made;

(i) any event of default by Borrower shall have occurred under Section 12.1(e)
(other than a default arising from a failure, despite Borrower’s commercially
reasonable best efforts, to obtain the third-party consents referenced in
Section 10.1(m) or 8.2 or to meet the condition set forth in Section 8.4(d) of
the Agreement) or (f)(i) of that certain Agreement and Plan of Merger
Reorganization dated as of the date hereof (the “Merger Agreement”) by and among
Lender, Roadster Merger Corporation, Borrower, and the Representative (as
defined therein), resulting in the termination of the Merger Agreement by
Lender; or

(j) a Change of Control occurs.

3.2 Consequences of Events of Default.

(a) If any Event of Default has occurred, the Applicable Interest Rate shall
increase by an increment of two percentage points or, if less, to the maximum
amount permitted by law. Any increase of the Applicable Interest Rate resulting
from the operation of this Section 3.2(a) shall terminate as of the close of
business on the date upon which no Events of Default exist.

(b) If any Event of Default of the type described in Section 3.1(f) has
occurred, the aggregate principal amount of this Note (together with all accrued
interest thereon and all other amounts due and payable with respect thereto)
shall become immediately due and payable without any further action on the part
of Lender, and the Borrower shall immediately pay to Lender all amounts due and
payable with respect to this Note.

(c) If any Event of Default under Section 3.1 (other than of the type described
in Section 3.1(f)) has occurred, Lender may declare all or any portion of the
outstanding principal amount of this Note (together with all accrued interest
thereon and all other amounts due and payable with respect thereto) to be
immediately due and payable and may demand immediate payment of all or any
portion of the outstanding principal amount of this Note, provided, however,
that in the case of any Event of Default due to the occurrence of an event of
default by Borrower under Section 12.1(e), Borrower may only make the preceding
declaration ninety (90) days after such Event of Default and it shall only be
effective if not cured by such date.

 

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(d) If any Event of Default of the type described in Section 3.1(j) has
occurred, upon the consummation of the transaction constituting the Change of
Control the aggregate principal amount of this Note (together with all accrued
interest thereon and all other amounts due and payable with respect thereto) and
an additional Five Million and No/100 Dollars ($5,000,000.00) shall be paid to
Lender from the proceeds of such Change of Control transaction prior to any
creditor, shareholder or other Person (other than the Pre-Existing Lenders)
receiving any of such proceeds.

(e) Lender shall also have any other rights which such holder may have been
afforded under any contract or agreement with the Borrower at any time and any
other rights which such holder may have pursuant to applicable law.

4. Waiver of Presentment and Notice. The Borrower hereby waives diligence,
presentment, protest and demand and notice of protest and demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that Lender may accept security
for this Note or release security for this Note, all without in any way
affecting the liability of the Borrower hereunder.

5. Representations, Warranties and Agreements. As a material inducement to
Lender to provide the indebtedness evidenced by this Note, Borrower hereby, and
each Loan Party upon being joined hereto pursuant to Section 6.10, represents
and warrants that:

5.1 Each Loan Party is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization and is
qualified to do business as a foreign organization in every jurisdiction where
the failure to so qualify could be reasonably expected to have a Material
Adverse Effect. Each Loan Party possesses all requisite power and authority and
all material licenses, permits and authorizations necessary to own and operate
its properties, to carry on its business as now conducted and presently proposed
to be conducted and to execute, deliver and perform its obligations under this
Note.

5.2 This Note, the Guaranty, the other Loan Documents and any document or other
agreement related hereto has been duly authorized, executed, and delivered by
the Loan Party thereto and does not conflict with, violate or result in a breach
of or require any consent that has not been obtained as of the date hereof under
(i) any applicable law, rule or regulation the violation of which could be
reasonably expected to have a Material Adverse Effect, (ii) any of the terms of
its organizational documents, or (iii) any material agreement or instrument to
which any Loan Party is a party or by which any Loan Party is bound.

5.3 This Note constitutes the legal, valid, and binding obligation of each Loan
Party, is in full force and effect and enforceable against each Loan Party in
accordance with its terms (subject, in each case, to the effect of bankruptcy or
other similar laws and to general principles of equity (whether considered in
proceedings at law or in equity)).

 

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5.4 No Default or Event of Default has occurred and is continuing or will occur
upon the funding of the Note hereunder.

5.5 All representations and warranties herein and in each other Loan Document
shall be true and correct as of the time of execution hereof or thereof and
shall survive the execution, delivery and acceptance hereof and thereof by the
parties thereto and the closing of the transactions described there in or
relating thereto.

6. Covenants. Until the indefeasible payment and satisfaction in full in cash of
all obligations of any Loan Party hereunder (including all accrued but unpaid
interest) and the termination of this Note, unless any Loan Parties receive the
prior written consent of Lender waiving or modifying any of the Loan Party’s
covenants hereunder in any specific instance, Borrower hereby, and each Loan
Party upon being joined hereto pursuant to Section 6.10, covenants and agrees as
follows:

6.1 Maintenance of Records; Legal Existence. Each Loan Party shall at all times
keep accurate and complete books, records and accounts with respect to all of
their respective business activities, in accordance with United States generally
accepted accounting principles consistently applied, and shall keep such books,
records and accounts, and any copies thereof, only at the addresses indicated
for such purpose on Exhibit A-1 or such other locations as the Borrower shall
notify Lender in accordance with subsection 6.2(a) hereof. Each Loan Party shall
maintain its legal existence in good standing in the jurisdiction in which it is
organized and in each other jurisdiction where it is required to register or
qualify to do business if the failure to do so in such other jurisdiction could
reasonably be expected to have a Material Adverse Effect.

6.2 Notices. The Borrower shall:

(a) Locations. Promptly notify Lender of the proposed opening of any new place
of business or new location of Collateral (as defined herein) other than such
places and locations identified on Exhibit A-2, the closing of any existing
place of business or location of Collateral, any change in the location of any
Loan Party’s books, records and accounts (or copies thereof), the opening or
closing of any bank account or, if any of the Collateral consists of Goods of a
type normally used in more than one state, the use of any such Goods in any
state other than a state in which the Borrower has previously advised Lender in
writing that such Goods will be used.

(b) Names and Trade Names. Promptly (and in any event within twenty-four hours)
notify Lender with respect to the change of its name, and promptly (and in any
event within five days) notify Lenders with respect to the use of any trade
name, assumed name, fictitious name or division name not previously disclosed to
Lender in writing.

(c) Collateral. Promptly (and in any event within 3 days) notify Lender of the
existence of any item with respect to which Lender has the option to require to
become subject to a separate pledge, assignment and security agreement pursuant
to Section 8.4 hereof.

 

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(d) Material Litigation. A prompt report of any legal actions pending or
threatened against Borrower, Loan Party or any of their respective Subsidiaries
that could reasonably be expected to result in damages or costs to Borrower,
Loan Party or any of their respective Subsidiaries of $500,000 or more, or in
which an adverse decision could reasonably be expected to result in a Material
Adverse Effect.

All of the foregoing notices and information shall be provided by the Borrower
to Lender in writing.

6.3 Compliance with Laws and Maintenance of Permits. Each Loan Party shall
maintain all governmental consents, franchises, certificates, licenses,
authorizations, approvals and permits, the lack of which could reasonably be
expected to have a Material Adverse Effect and each Loan Party shall remain in
compliance with all applicable federal, state, local and foreign statutes,
orders, regulations, rules and ordinances (including, without limitation,
environmental laws and statutes, orders, regulations, rules and ordinances
relating to taxes, employer and employee contributions and similar items,
securities, ERISA or employee health and safety) the failure with which to
comply could reasonably be expected to have a Material Adverse Effect.

6.4 Inspection and Audits. Each Loan Party shall permit Lender to call at its
places of business without hindrance or delay to inspect the Collateral and to
inspect and audit their books, records, journals, orders, receipts and any
correspondence and other data relating to each Loan Party’s business, the
Collateral or any transactions between the parties hereto, and shall have the
right to make such verification concerning each Loan Party’s business as Lender
may consider necessary or advisable under the circumstances.

6.5 Insurance. The Borrower shall keep the Collateral properly insured for the
full insurable value thereof against loss or damage by such risks as are
customarily insured against by Persons engaged in businesses similar to that of
the Borrower, with such companies, in such amounts, with such deductibles, and
under policies in such form, as Lender may consider necessary or advisable. Upon
Lender’s request, original (or certified) copies of such policies of insurance
have been or shall be, within thirty (30) days of the date hereof, delivered to
Lender, together with evidence of payment of all premiums therefor, and at
Lender’s request, shall contain an endorsement, in form and substance reasonably
acceptable to Lender, showing loss under such insurance policies payable to
Lender.

6.6 Collateral. Each Loan Party shall keep the Collateral in good condition,
repair and order, ordinary wear and tear and damage by casualty excepted. Each
Loan Party shall, at the request of Lender, indicate on its records concerning
the Collateral a notation, in form reasonably satisfactory to Lender, of the
security interest of Lender hereunder.

6.7 Guaranties. Each Loan Party shall not assume, guarantee or endorse, or
otherwise become liable in connection with, the obligations of any Person,
except (i) by endorsement of instruments for deposit or collection or similar
transactions in the ordinary course of business, (ii) swap contracts entered
into in the ordinary course of business for bona fide hedging purposes and not
for purposes of speculation, (iii) contingent obligations existing on the

 

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date hereof and disclosed on Schedule 6.7 attached hereto (including extensions
and renewals thereof which do not increase the amount or extend the term of such
contingent obligations as of the date of such extension or renewal),
(iv) contingent obligations incurred in the ordinary course of business with
respect to surety and appeal bonds, performance bonds and other similar
obligations (exclusive of obligations for the payment of borrowed money),
(v) contingent obligations arising under indemnity agreements to title insurers
to cause such title insurers to issue title insurance policies required
hereunder, or arising under customary indemnification provisions contained in
leases, licenses and other agreements entered into the ordinary course of
business, (vi) contingent obligations arising with respect to customary
indemnification obligations in favor of purchasers in connection with
dispositions permitted hereunder, and (vii) obligations of Borrower with respect
to indemnification of its officers and directors.

6.8 Indebtedness. Each Loan Party shall not create, incur, assume or become
obligated (directly or indirectly), for any loans or other indebtedness for
borrowed money other than the indebtedness evidenced hereby and other than such
indebtedness outstanding on the date hereof and disclosed on Schedule 6.8
attached hereto (including extensions and renewals thereof which do not increase
the amount or extend the term of such indebtedness as of the date of such
extension or renewal); provided that the Loan Parties may (i) incur unsecured
indebtedness to trade creditors in the ordinary course of business; (ii) incur
purchase money indebtedness or capitalized lease obligations in the ordinary
course of business in an aggregate principal amount not to exceed $500,000 at
any one time outstanding (or such higher amount as may be agreed to by Lender
from time to time hereafter in writing); (iii) incur indebtedness not otherwise
permitted hereunder in an amount not to exceed $100,000 (or such higher amount
as may be agreed to by Lenders in from time to time hereafter in writing), in
the aggregate, and (iv) renewals and replacements of any of the foregoing in
each case to the extent that such renewal or replacement does not increase the
aggregate outstanding principal amount thereof and is on terms no more onerous
in any material respect to the such Loan Party as applicable in respect thereof;
provided, that the endorsement of items for deposit or collection received in
the ordinary course of business and accrued expenses incurred in the ordinary
course of business shall not be deemed to be “indebtedness” hereunder; provided,
further, that, without Lender’s prior written consent, the Borrower shall not
agree to assignment, replacement or other refinancing of the Pre-Existing Loan
Agreements if such assignment, replacement or refinancing results in any lender
other than the Pre-Existing Lenders being a party to the documentation effecting
such transaction.

6.9 Bank Accounts. Each Loan Party shall not establish any new bank accounts
without prior written notice to Lender.

6.10 Subsidiaries. Each Loan Party shall not, without prior notice to Lender,
establish, create or acquire any new subsidiary or enter into any joint ventures
or partnerships with any other Person and shall, at the request of Lender, cause
any such new subsidiary to join as a Loan Party to the Loan Documents in a
manner as Lender may deem necessary or desirable.

6.11 Fundamental Changes, Line of Business. Except as contemplated by the Merger
Agreement, each Loan Party shall not amend its organizational documents or
change its fiscal year or enter into a new line of business materially different
from the Loan Parties’ current business.

 

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6.12 Investments; Distributions. Each Loan Party shall not directly or
indirectly acquire or own any Person, or make any Investment in any Person,
other than Permitted Investments, or pay any dividends or make any distribution
or payment to stockholders or redeem, retire or purchase any capital stock.
“Permitted Investments” are (i) Investments existing on the date hereof and
disclosed on Schedule 6.12 attached hereto; (ii) marketable direct obligations
issued or unconditionally guaranteed by the United States of America or any
agency or any State thereof maturing within 1 year from the date thereof,
(b) commercial paper maturing no more than 1 year from the date of its creation,
and (c) certificates of deposit maturing no more than 1 year after issue and
issued by Lender or by any commercial bank organized under the laws of the
United States of America or any State thereof; (iii) Investments consisting of
(a) travel advances, employee relocation loans and other employee loans and
advances in the ordinary course of the a Loan Party’s business and (b) loans to
employees, officers or directors relating to the purchase of equity securities
of Borrower pursuant to employee stock purchase plans or arrangements approved
by Borrower’s board of directors; (iv) Investments (including debt obligations)
received in connection with the bankruptcy or reorganization of customers or
suppliers and in settlement of delinquent obligations of, and other disputes
with, customers or suppliers arising in the ordinary course of business;
(v) Investments consisting of notes receivable or, prepaid royalties and other
credit obligations to customers and suppliers who are not Affiliates, in the
ordinary course of business, (vi) Investments by Borrower in a subsidiary not to
exceed a total of $1,000,000 after the date of this Agreement, exclusive of
amount necessary to cover payroll and operating expenses projected to be
incurred for up to a period of two months after the date of transfer of such
funds to such subsidiary; and (vii) Investments by a Loan Party in RMI
International Cayman Limited, a Cayman Islands corporation (“RMII”), pursuant to
the transaction contemplated by that certain Cost Sharing Agreement, dated as of
May 30, 2008, between the Borrower and RMII or that certain Buy-In License
Agreement, dated as of May 30, 2008, between the Borrower and RMII; provided,
however, that (x) Borrower may convert any of its convertible securities in to
other securities pursuant to the terms of such convertible securities or
otherwise in exchange thereof, (y) Borrower may pay dividends solely in stock of
the Borrower, and (z) Borrower may repurchase the stock of former employees,
former directors, or former consultants pursuant to stock repurchase agreements
so long as no Default or Event of Default has occurred at the time of such
repurchase and would not exist after giving effect to such repurchase, provided
such repurchase does not exceed in the aggregate of $500,000 in any fiscal year.

6.13 Financial Statements. Borrower shall deliver to Lender: (i) as soon as
available, but no later than thirty (30) days after the last day of each fiscal
month, monthly consolidated and consolidating balance sheets and income
statements covering consolidated and consolidating operations of Borrower and
its respective Subsidiaries during the period certified by a Responsible
Officer; (ii) as soon as available, but no later than one-hundred and eighty
(180) days after the last day of Borrower’s fiscal year, reviewed annual
consolidated and consolidating financial statements prepared under GAAP,
consistently applied, prepared by an independent certified public accounting
firm; and (iii) any and all information that Lender may reasonably request of
the Borrower or any other Loan Party with respect to the business, assets,
properties, financial performance and prospects of the Borrower or any other
Loan Party.

 

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7. Liens. Each Loan Party agrees that it will not create, incur, assume or
suffer to exist any Lien upon any of the Collateral, whether now owned or
hereafter acquired, except for (i) Liens securing the indebtedness evidenced
hereby, (ii) Liens for taxes, assessments or other governmental charges not at
the time delinquent or being contested in good faith by appropriate proceedings
and, in each case, for which it maintains adequate reserves, (iii) Liens arising
in the ordinary course of business (such as Liens of carriers, landlords,
warehousemen, mechanics and materialmen and other similar Liens imposed by law),
(iv) Liens in existence on the date hereof with respect to indebtedness
permitted hereby, (v) Liens arising from precautionary UCC financing statement
filings regarding operating leases, (vi) licenses of intellectual property in
the ordinary course of business, (vii) Liens (other than any Lien imposed by
ERISA, and other than any Lien securing an obligation for the payment of
borrowed money or for the deferred purchase price of property or services)
incurred or deposits made in the ordinary course of business in connection with
obligations not due or delinquent with respect to workers’ compensation,
unemployment insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal bonds, bids,
leases, government contracts, performance and return-of-money bonds and other
similar obligations; (viii) attachment or judgment Liens (including judgment or
appeal bonds) not exceeding $500,000 in the aggregate at any time outstanding
for all Loan Parties, provided that any such Lien shall, within 30 days after
the entry thereof, have been discharged or execution thereof stayed pending
appeal, or shall have been discharged within 30 days after the expiration of any
such stay; (ix) zoning restrictions, easements, licenses, reservations,
restrictions on the use of real property or minor irregularities incident
thereto (and, with respect to leasehold interests, Liens and other encumbrances
that are incurred, created, assumed or permitted to exist on or with respect to
the leased property and arise by, through or under or are asserted by a landlord
or owner of the leased property, with or without consent of the lessee) which
were not incurred in connection with the borrowing of money and which do not in
the aggregate materially detract from the value of the property of any Loan
Party or any of their subsidiaries, as the case may be, or impair the use of
such property for the purposes for which such property is held by any such
Person; (x) Liens in favor of Pre-Existing Lenders pursuant to the Pre-Existing
Loan Agreements in accordance with the Intercreditor Agreement; (xi) Liens
securing purchase money indebtedness incurred in connection with the purchase,
acquisition or construction by any Loan Party of real property, improvements
thereto, equipment or other fixed assets or intangibles (including software);
provided that (a) such security interests secure Indebtedness permitted by
Section 6.8(ii), and (x) Liens existing on equipment when acquired, if the Lien
is confined to the property and improvements and the proceeds of the equipment
and is securing indebtedness permitted by Section 6.8(ii).

8. Security.

8.1 Note and Loan Secured. All property and Liens assigned, pledged or otherwise
granted to Lenders by any Loan Party under this Note or under any other
Collateral Document shall secure the payment of the principal amount of the
indebtedness evidenced by this Note and interest thereon and the other amounts
payable by Borrower to Lender hereunder or thereunder. In addition to this Note,
each Loan Party other than Borrower shall enter into the Guaranty in favor of
Lender.

 

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8.2 Grant of Liens. Each Loan Party hereby assigns, pledges and grants to
Lender, and agrees that Lender shall have a first priority perfected and
continuing security interest in, and Lien on, the following property and
interests in property of such Loan Party, whether now owned or hereafter
acquired or existing, and wherever located (the “Collateral”): (a) all rights,
title and interest in and to all of its Accounts, Inventory, Chattel Paper,
Documents, Goods, Commercial Tort Claims, Investment Property, Instruments,
Securities, General Intangibles, Deposit Accounts, Letter-of-Credit Rights,
Supporting Obligations and money (as such capitalized terms are defined in the
Uniform Commercial Code in effect from time to time), (b) all returned, rejected
or repossessed goods, the sale or lease of which shall have given or shall give
rise to an Account or Chattel Paper, (c) all books and records in whatever media
(paper, electronic or otherwise) recorded or stored, with respect to the
foregoing and all equipment and general intangibles necessary or beneficial to
retain, access and/or process the information contained in those books and
records, (d) all other assets and personal property, and (e) all accessions to,
substitutions for, and all replacements, cash and non-cash proceeds and products
of the foregoing. Each Loan Party further agrees that Lender shall have in
respect thereof all of the rights and remedies of a secured party under the
Uniform Commercial Code as well as those provided in this Note, the other Loan
Documents and under applicable Laws.

8.3 Collateral Disclosure List. After the date hereof, at Lender’s request, the
Loan Parties shall deliver to Lender a list (the “Collateral Disclosure List”)
which shall contain such information with respect to the Loan Party’s business
and property as Lender may require. Promptly after demand by Lender, each Loan
Party shall furnish to Lender an update of the information contained in the
Collateral Disclosure List at any time and from time to time as may be requested
by Lender. Such updates shall be deemed to be included in the definition of
“Collateral Disclosure List.”

8.4 Personal Property. Each Loan Party acknowledges and agrees that it is the
intention of each Loan Party and Lender that Lender shall have a perfected Lien,
in form and substance satisfactory to Lender and each of their counsel, on all
of the Collateral, whether now owned or hereafter arising or acquired. Subject
to the Intercreditor Agreement, within ten (10) days of Lender’s request, each
Loan Party shall deliver to Lenders all originals of all Collateral consisting
of certificated Securities (having a monetary value in excess of $250,000 on an
individual basis), Instruments (with a face value of each instrument in excess
of $250,000 on an individual basis), tangible Chattel Paper (having a monetary
value in excess of $250,000 on an individual basis), and Documents (having a
monetary value in excess of $250,000 on an individual basis). In addition, each
Loan Party agrees to take those actions reasonably requested by Lender and
consistent with this Note and the Intercreditor Agreement to perfect Lender’
security interest in and Lien on the Collateral (whether now owned or hereafter
acquired).

 

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8.5 General Collateral Matters.

(a) Each Loan Party authorizes Lender to file financing statements and
amendments thereto against each Loan Party indicating the Collateral (including
an indication that the financing statement covers all or substantially all
assets and/or personal property of such Loan Party or words of similar import)
in such jurisdictions as Lender determines is necessary or desirable to perfect
Lender’s security interest in the Collateral.

(b) If requested by Lender, each Loan Party will cooperate with Lender in
obtaining control with respect to Collateral consisting of Deposit Accounts,
material Letter-of-Credit Rights and material Electronic Chattel Paper (as such
capitalized terms are defined in the Uniform Commercial Code).

(c) Each Loan Party will not reincorporate or reorganize itself under the laws
of any jurisdiction other than the jurisdiction in which it is as of the date
hereof incorporated or organized without the prior written consent of Lender,
and each Loan Party will not be incorporated or organized under the laws of any
more than one jurisdiction at any one time.

(d) Each Loan Party acknowledges that it is not authorized to file any financing
statement or amendment or termination statement with respect to any financing
statements relating to the Collateral or any other property, real or personal,
that is subject to a Lien in favor of Lender without the prior written consent
of Lender, and each Loan Party agrees that it will not do so without such prior
written consent, subject to the Loan Parties’ rights under Section 9-509(d)(2)
of the Uniform Commercial Code (to the extent such section has been enacted in
the relevant jurisdiction).

(e) Loan Parties shall deliver an executed Intellectual Property Security
Agreement in form and substance acceptable to Lender on or before June 10, 2009

8.6 Release. Upon the indefeasible payment in full in cash of all obligations of
Borrower under this Note and the other Loan Documents, at the Borrower’s sole
cost and expense, Lender shall release and/or terminate any financing statement
against the Collateral.

9. Amendment and Waiver. Except as otherwise expressly provided herein, the
provisions of the Note may not be amended and the Loan Parties may not take any
action herein prohibited, or omit to perform any act herein required to be
performed by it, without the prior written consent of Lender.

10. [Reserved.]

11. Definitions. For purposes of this Note, capitalized terms used herein,
unless not otherwise defined herein, have the following meanings:

“Affiliate” means, as to any Person, any Person which directly or indirectly
Controls, is controlled by, or is under common control with such Person. For
purposes of this definition, “Control” of a Person means the power, direct or
indirect, (i) to vote or direct the voting of 25% or more of the outstanding
shares of voting equity interests of such Person, or (ii) to direct or cause the
direction of the management and policies of such Person whether by ownership of

 

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voting equity interests, by contract or otherwise. “Controlling” and
“Controlled” have meanings correlative thereto. Notwithstanding the foregoing,
for purposes of this Note, the Loan Documents and related documents, neither
Lender nor any of their Affiliates shall be deemed to be Affiliates of the
Borrower, Parent, the other Loan Parties or any of their subsidiaries.

“Applicable Interest Rate” means 10.00% per annum.

“Change of Control” means (i) any reorganization, consolidation or merger by
Borrower with another Person (except with Lender or any Affiliate of Lender);
(ii) any transaction (other than a primarily equity financing event or the
transactions contemplated by the Merger Agreement) in which the holders of
Borrower’s outstanding capital stock immediately before consummation of such
transaction or series of related transactions do not, immediately after
consummation of such transaction(s), own capital stock representing at least
50.0% or the voting power of the surviving Person; or (iii) the sale, license or
other disposition of all or substantially all of Borrower’s assets (other than
pursuant to the transactions contemplated by the Merger Agreement).

“Collateral” has the meaning given to such term in Section 8.2 of this Note.

“Collateral Disclosure List” has the meaning given to such term in Section 8.3
of this Note.

“Collateral Documents” means collectively any assignment, pledge agreement,
security agreement (including, without limitation, the Intellectual Property
Security Agreement), mortgage, deed of trust, deed to secure debt, financing
statement and any similar instrument, document or agreement under or pursuant to
which a Lien is now or hereafter granted to, or for the benefit of, Lender on
any real, personal or intangible property of any Person to secure all or any
portion of the obligations owing by the Borrower under this Note and the Loan
Documents to Lender, all as the same may from time to time be amended, restated,
supplemented or otherwise modified.

“Default” means an event, which, with the giving of notice or the passage of
time, or both, could or would constitute an Event of Default hereunder.

“ERISA” means the Employee Retirement Income Security Act of 1974, as from time
to time amended.

“GAAP” means generally accepted accounting principles as in effect from time to
time in the United States of America, applied on a consistent basis both as to
classification of items and amounts.

“Gold Hill” Gold Hill Venture Lending 03, L.P.

“Guaranty” means any guaranty entered into after the date hereof by any Loan
Party other than the Borrower with respect to the obligations of Borrower under
this Note.

 

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“Intercreditor Agreement” means that certain Subordination Agreement, dated as
of the date hereof, among the Pre-Existing Lenders and Lender.

“Intellectual Property Security Agreement” means that certain Intellectual
Property Security Agreement, dated as of the date hereof, by and between
Borrower and Lender.

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

“Lien” means any mortgage, deed of trust, pledge, security interest, assignment
for security, encumbrance for security, lien, or hypothecation, whether
perfected or unperfected, avoidable or unavoidable, including, without
limitation, any condition sale or other title retention agreement, and any lease
in the nature of a security interest.

“Loan Document” shall mean this Note, any Guaranty, the Collateral Disclosure
List, any Collateral Document and any other document executed and delivered by a
Loan Party to Lender in connection herewith or therewith.

“Loan Party” shall mean Borrower and any Subsidiary Loan Party that is party to
any Loan Document.

“Material Adverse Effect” means any change or changes or effect or effects that
individually or in the aggregate are materially adverse to (i) the perfection or
priority of Bank’s security interest in the Collateral or in the value of such
Collateral, (ii) business, operations or financial condition of the Loan Parties
taken as a whole, or (iii) the legality, validity or enforceability of this Note
and related documents.

“Maturity Date” means the earliest to occur of (i) November 30, 2010 after the
date hereof and (ii) acceleration of the Note obligations pursuant to
Section 3.2; or such later date as agreed to by Lenders in writing.

“Merger Agreement” has the meaning given to such term in Section 3.1(i) of this
Note.

“Person” means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an
unincorporated organization and a governmental entity or any department, agency
or political subdivision thereof.

“Pre-Existing Lenders” shall mean VLL4, Gold Hill and SVB.

“Pre-Existing Loan Agreements” shall mean that certain (i) Loan and Security
Agreement, dated as of December 14, 2004, by and among Borrower, VLL4, Gold Hill
and SVB, (ii) Loan and Security Agreement, dated as of December 26, 2006, by and
among Borrower, VLL4 and SVB and (iii) Amended and Restated Loan and Security
Agreement, dated as of March 8, 2007, as amended as of March 8, 2009, by and
between Borrower and SVB.

“Responsible Officer” means, with respect to any corporation, any of the Chief
Executive Officer, the Chief Financial Officer, the General Counsel or the
Treasurer of such corporation, and, with respect to any limited liability
company or other type of business entity, any manager or other individual
performing comparable management functions with respect to such entity.

 

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“SVB” means Silicon Valley Bank.

“Subsidiary Loan Party” means each subsidiary of Borrower which may become a
party to a Loan Document from time to time pursuant to Section 6.10.

“Uniform Commercial Code” means the Uniform Commercial Code as from time to time
in effect in the State of California.

“VLL4” means Venture Lending & Leasing IV, Inc.

For purposes of this Note, capitalized terms used herein and which are defined
in the Uniform Commercial Code (as in effect from time to time) and which are
not otherwise defined herein are given the meanings ascribed to such capitalized
terms in the Uniform Commercial Code (as in effect from time to time).

12. Costs and Expenses. The Borrower agrees to promptly pay all costs and
expenses (including reasonable attorneys’ fees) incurred by Lender in enforcing
any rights under, or in collecting any payments due under, this Note, the Loan
Documents or in connection with any refinancing or restructuring of the credit
arrangements provided under this Note in the nature of a workout, or any
insolvency or bankruptcy proceedings. The costs and expenses for which the
Borrower is responsible under this Section 12 shall be payable promptly upon
Lender’s demand and deemed part of the obligations which are secured by the
Collateral hereunder. The obligations of the Borrower under this Section 12
shall survive the payment in full of this Note.

13. Transfer. Unless an Event of Default shall exist, Lender shall have no right
to sell, transfer, assign, pledge or otherwise dispose of (whether with or
without consideration and whether voluntarily or involuntarily or by operation
of law) (a “Transfer”) all or any part of this Note. No Loan Party may Transfer
any of its rights or obligations hereunder or under any other Loan Document
without the prior written consent of Lender.

14. Payments. All payments to be made to Lender shall be made in the lawful
money of the United States of America in immediately available funds without
setoff, counterclaim or deduction. Any payment received by Lender after 1:00
p.m. (California time) on any day, will be deemed to have been received on the
next following business day.

15. Business Days. If any payment is due, or any time period for giving notice
or taking action expires, on a day which is not a business day, the payment
shall be due and payable on, and the time period shall automatically be extended
to, the next business day immediately following, and interest shall continue to
accrue at the required rate hereunder until any such payment is made.

 

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16. No Setoffs, etc. All payments hereunder shall be made by the Borrower
without setoff, offset, deduction or counterclaim, free and clear of all taxes,
levies, imports, duties, fees and charges, and without any withholding,
restriction or conditions imposed by any governmental authority. If the Borrower
shall be required by any law to deduct, setoff or withhold any amount from or in
respect of any payment to Lender hereunder, then the amount so payable to Lender
shall be increased as may be necessary so that, after making all required
deductions, setoffs and withholdings, Lender shall receive an amount equal to
the sum it would have received had no such deductions, setoffs or withholding
been made.

17. Payment Set Aside. To the extent that the Borrower makes a payment or
payments to Lender hereunder or Lender enforces its rights or exercises its
right of setoff hereunder, and such payment or payments or the proceeds of such
enforcement or setoff or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the Borrower, a
trustee, receiver or any other Person under any law (including any bankruptcy
law, state or federal law, common law or equitable cause of action), then to the
extent of any such restoration the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such enforcement or setoff had not
occurred.

18. Usury Laws. It is the intention of the Borrower and Lender to conform
strictly to all applicable usury laws now or hereafter in force, and any
interest payable under this Note shall be subject to reduction to the amount not
in excess of the maximum legal amount allowed under the applicable usury laws as
now or hereafter construed by the courts having jurisdiction over such matters.
If the maturity of this Note is accelerated by reason of an election by Lenders
resulting from an Event of Default, demand, voluntary prepayment by the Borrower
or otherwise, then earned interest may never include more than the maximum
amount permitted by law, computed from the date hereof until payment, and any
interest in excess of the maximum amount permitted by law shall be canceled
automatically and, if theretofore paid, shall at the option of the holder hereof
either be rebated to the Borrower or credited on the principal amount of this
Note, or if this Note has been paid, then the excess shall be rebated to the
Borrower. The aggregate of all interest (whether designated as interest, service
charges, points, or otherwise) contracted for, chargeable, or receivable under
this Note shall under no circumstances exceed the maximum legal rate upon the
unpaid principal balance of this Note remaining unpaid from time to time. If
such interest does exceed the maximum legal rate, it shall be deemed a mistake
and such excess shall be canceled automatically and, if theretofore paid,
rebated to the Borrower or credited on the principal amount of this Note, or if
this Note has been repaid, then such excess shall be rebated to the Borrower.

19. Notices. Any notice required to be given to any Loan Party or Lender
hereunder shall be deemed effective only if in writing and delivered by personal
service or delivered to an overnight courier service, with guaranteed next day
delivery or mailed by registered or certified mail, return receipt requested,
postage prepaid, to the below addresses (or such other address as may be
provided in writing to the other party):

Borrower:

RMI Corporation

18920 Forge Drive

Cupertino, CA 95014

Attn: Chief Financial Officer

 

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Lender:

Netlogic Microsystems, Inc.

1875 Charleston Road

Mountain View, CA 94043

Attn: Mike Tate, Chief Financial Officer

20. Survival. The obligations of the Borrower under Section 12, 20 and 21 shall
survive the payment in full of this Note.

21. No Fiduciary Relationship. No provision in the Loan Documents and no course
of dealing between the parties hereto shall be deemed to create any fiduciary
duty by Lender in respect of any Loan Party or any subsidiary of a Loan Party.

22. Governing Law. This Note and all questions governing the construction,
validity and interpretation of this Note will be governed by the internal law of
the State of California, without regard to conflicts of law principles.

23. Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY WAIVES TRIAL BY JURY
IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY OF THEM AGAINST THE
OTHER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS NOTE, OR ANY OTHER
AGREEMENTS EXECUTED IN CONNECTION HEREWITH OR THE ADMINISTRATION THEREOF OR ANY
OF THE TRANSACTIONS CONTEMPLATED HEREIN (collectively, a “Claim”). If the waiver
of jury trial set forth in this Section 25 is ineffective or unenforceable, the
parties agree that all Claims shall be resolved by reference to a private judge
sitting without a jury, pursuant to Code of Civil Procedure Section 638, before
a mutually acceptable referee or, if the parties cannot agree, a referee
selected by the Presiding Judge of the Santa Clara County, California. Such
proceeding shall be conducted in Santa Clara County, California, with California
rules of evidence and discovery applicable to such proceeding.

24. Entire Agreement. This Note and the other documents referred to herein
embody the entire agreement among the parties hereto and supersede any and all
prior commitments, agreements, representations, understandings, whether oral or
written, relating to the subject matter hereof and may not be contradicted or
varied by evidence of prior, contemporaneous or subsequent oral agreements or
discussions of the parties hereto.

25. Severability. If any part of this Note is contrary to, or prohibited by, or
deemed invalid under applicable laws or regulations, such provision shall be
inapplicable and deemed omitted to the extent so contrary, prohibited or
invalid, but the remainder hereof shall not be invalidated thereby and shall be
given effect so far as possible.

 

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26. Successors; No Third Party Beneficiaries. All of the terms of this Note
shall inure to the benefit of Lender and its respective successors and assigns
and shall be binding upon the Loan Parties and each of their respective
permitted successors and assigns Except as otherwise expressly provided herein
or therein, no other Person shall be a direct or indirect beneficiary of, or
have any direct or indirect cause of action or claim in connection with, this
Note or the other Loan Documents.

[Signature page follows]

 

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IN WITNESS WHEREOF, Borrower has executed and delivered this Secured Promissory
Note as of the date first written above.

 

RMI CORPORATION, a Delaware corporation By:   /s/ L. William Caraccio

Name:   L. William Caraccio Title:   SVP