Exhibit 10.1

JPMORGAN CHASE BANK, N.A.

383 Madison Avenue

New York, New York 10179

June 15, 2016

Cavium, Inc.

2315 N. First Street

San Jose, CA 95131

Attention: Arthur Chadwick and Vincent Pangrazio

Project Quasar

Commitment Letter

Ladies and Gentlemen:

Cavium, Inc. (“you” or the “Borrower”) has advised JPMorgan Chase Bank, N.A.
(“JPMCB” and, together with any Additional Arrangers appointed pursuant to
Section 1 below, the “Commitment Parties”, “we” or “us”) that you intend to
acquire (the “Acquisition”) an entity identified to us as “Quasar” (“Quasar” or
the “Target”; the Target collectively with its subsidiaries, the “Acquired
Business”). The Acquisition will be effected through (i) the purchase of shares
of common stock of the Target by a newly formed wholly owned subsidiary of the
Borrower (“Merger Sub”) in the Offer (as defined in the Acquisition Agreement
(as defined below)) and (ii) promptly following the closing of the Offer, the
merger (the “Merger”) of Merger Sub with and into the Target pursuant to Section
251(h) of the Delaware General Corporation Law, with the Target surviving the
Merger as your direct or indirect wholly-owned subsidiary (the date of
consummation of the Merger, the “Merger Closing Date”). In connection with the
Acquisition, existing indebtedness of the Acquired Business under that certain
Credit Agreement, dated as of March 20, 2013, among the Target, the lenders
party thereto and JPMCB, as administrative Agent (as amended from time to time,
the “Target Credit Agreement”), will be repaid in full, all commitments
thereunder will be terminated and the security interests with respect thereto
(if any) will be released (the “Refinancing”). The Borrower, the Acquired
Business and their respective subsidiaries are sometimes collectively referred
to herein as the “Companies”.

You have also advised us that in connection with the Acquisition you intend to
incur: (a) $650,000,000 aggregate principal amount of senior secured term B
loans (the “Term B Loan Facility”) and (b) $100,000,000 aggregate principal
amount of senior secured interim loans for interim financing (the “Interim Term
Loan Facility” and, together with the Term B Loan Facility, the “Term Loan
Facilities”). The Acquisition, the Refinancing, the entering into and initial
funding of the Term Loan Facilities and all related transactions are hereinafter
collectively referred to as the “Transaction”. The date of the acceptance of the
tendered shares in the Offer and funding of the Term B Loan Facility and (if
applicable) the Interim Term Loan Facility is referred to herein as the “Closing
Date”.

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1. Commitments. In connection with the foregoing, (a) JPMCB is pleased to advise
you of its commitment to provide 100% of the principal amount of each of the
Term Loan Facilities (in such capacities, together with any Additional Arrangers
appointed as described below, the “Initial Lenders”), in each case, subject only
to the conditions set forth in paragraph 5 hereto; and (b) JPMCB is pleased to
advise you of its willingness, and you hereby engage JPMCB to act as a joint
lead arranger and a joint bookrunning manager (in such capacities, together with
any Additional Arrangers appointed as described below, the “Lead Arrangers”) for
the Term Loan Facilities, and in connection therewith to form a syndicate of
lenders for the Term Loan Facilities (collectively, the “Lenders”), in
consultation with you and reasonably acceptable to you. It is understood and
agreed that (x) JPMCB shall have “top left” placement in any listing of the Lead
Arrangers, (y) JPMCB shall act as administrative agent for the Term Loan
Facilities (in such capacity, the “Administrative Agent”) and (z) JPMCB may
perform its responsibilities hereunder as a Lead Arranger through its affiliate,
J.P. Morgan Securities LLC. Notwithstanding anything to the contrary contained
herein, the commitments of the Initial Lenders with respect to the initial
fundings of the Term Loan Facilities will be subject only to the satisfaction
(or waiver by the Initial Lenders) of the conditions precedent set forth in
paragraph 5 hereof. All capitalized terms used and not otherwise defined herein
shall have the same meanings as specified therefor in Annexes I and II hereto
(the “Summary of Terms”).

Except as set forth below, you agree that no other agents, co-agents, arrangers
or bookrunners will be appointed, no other titles will be awarded and no
compensation (other than compensation expressly contemplated by this Commitment
Letter and the Fee Letter referred to below) will be paid to any Lender in order
to obtain its commitment to participate in any of the Term Loan Facilities
unless you and we shall so agree; provided that you may, on or prior to the date
which is 10 business days after the date of your acceptance of this Commitment
Letter, appoint up to two additional joint bookrunners, arrangers, agents,
co-agents, managers or co-managers (the “Additional Arrangers”) for the Term
Loan Facilities, and award such Additional Arrangers titles in a manner and with
economics set forth in the immediately succeeding proviso (it being understood
that, to the extent you appoint any Additional Arranger or confer other titles
in respect of the Term Loan Facilities, then, notwithstanding anything in
paragraph 2 to the contrary, the commitments of the Initial Lenders in respect
of the Term Loan Facilities, in each case pursuant to and in accordance with
this proviso, will be permanently reduced by the amount of the commitments of
such appointed entities (or their relevant affiliates) in respect of the Term
Loan Facilities, with such reduction allocated to reduce the commitments of the
Initial Lenders in respect of the Term Loan Facilities at such time (excluding
any Initial Lender that becomes a party hereto pursuant to this proviso) on a
pro rata basis according to the respective amounts of their commitments, upon
the execution by such Additional Arranger (and any relevant affiliate) of
customary joinder documentation and, thereafter, each such Additional Arranger
(and any relevant affiliate) shall constitute a “Commitment Party” and/or “Lead
Arranger” hereunder and it or its relevant affiliate providing such commitment
shall constitute an “Initial Lender” hereunder); provided, further, that, in
connection with the appointment of any Additional Arranger in accordance with
the immediately preceding proviso, (a) the aggregate economics payable to all
such Additional Arrangers (or any relevant affiliate thereof) in respect of the
Term Loan Facilities shall not exceed 25% of the total underwriting economics
payable to the Commitment Parties in respect of the Term Loan Facilities
pursuant to the Fee Letter (exclusive of any fees payable to the Administrative
Agent in its capacity as such and exclusive of ticking fees accruing prior to
the date of such joinder), (b) no Additional Arranger (or its relevant
affiliates) shall receive a greater percentage of the economics in respect of
the Term Loan Facilities than JPMCB and (c) each Additional Arranger (or its
relevant affiliates) shall assume a proportion of the commitments with respect
to the Term Loan Facilities that is equal to the proportion of the economics
allocated to such Additional Arranger pursuant to customary joinder
documentation executed by such Additional Arranger (and any relevant affiliate).

2. Syndication. The Lead Arrangers intend to commence syndication of the Term
Loan Facilities promptly after your acceptance of the terms of this Commitment
Letter and the Fee Letter

 

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(as hereinafter defined); provided that we agree not to syndicate our
commitments to certain banks, financial institutions and other institutional
lenders and any competitors (or Known Affiliates (as defined below) of
competitors) of the Companies, in each case, that have been specified to us by
you in writing prior to the date hereof (collectively, “Disqualified Lenders”);
provided, further, that you, upon reasonable notice to us after the date hereof
and prior to the launch of general syndication (or to the Administrative Agent
after the Closing Date), shall be permitted to supplement in writing the list of
persons that are Disqualified Lenders to the extent such supplemented person is
or becomes a competitor or a Known Affiliate of a competitor of the Companies,
which supplement shall be in the form of a list provided to us (or the
Administrative Agent) and become effective upon delivery to us (or the
Administrative Agent), but which supplement shall not apply retroactively to
disqualify any parties that have previously acquired an assignment in the loans
under any of the Term Loan Facilities. As used herein, “Known Affiliates” of any
person means, as to such person, known affiliates readily identifiable by name,
but excluding any affiliate that is a bona fide debt fund or investment vehicle
that is primarily engaged in, or that advises funds or other investment vehicles
that are engaged in, making, purchasing, holding or otherwise investing in
commercial loans, bonds or similar extensions of credit or securities in the
ordinary course and with respect to which the Disqualified Lender does not,
directly or indirectly, possess the power to direct or cause the direction of
the investment policies of such entity. Without limiting your obligations to
assist with syndication efforts as set forth herein, it is understood that the
Initial Lenders’ commitments hereunder are not conditioned upon the syndication
of, or receipt of commitments or participations in respect of, the Term Loan
Facilities and in no event shall the commencement or successful completion of
syndication of the Term Loan Facilities constitute a condition to the
availability of the Term Loan Facilities on the Closing Date. You agree, until
the Syndication Date (as hereinafter defined), to actively assist, and, to the
extent provided for in the Acquisition Agreement, to use your commercially
reasonable efforts to cause the Acquired Business to actively assist, the Lead
Arrangers in achieving a syndication of the Term Loan Facilities that is
reasonably satisfactory to the Lead Arrangers and you; provided that,
notwithstanding each Lead Arranger’s right to syndicate the Term Loan Facilities
and receive commitments with respect thereto, it is agreed that (i) syndication
of, or receipt of commitments or participations in respect of, all or any
portion of an Initial Lender’s commitments hereunder prior to the date of the
consummation of the Acquisition and the date of the initial funding under the
Term Loan Facilities shall not be a condition to such Initial Lender’s
commitments and (ii) (a) except as you in your sole discretion may otherwise
agree in writing, no Initial Lender shall be relieved, released or novated from
its obligations hereunder (including its obligation to fund the Term Loan
Facilities on the Closing Date) in connection with any syndication, assignment
or participation of the Term Loan Facilities, including its commitments in
respect thereof, until after the initial funding of the Term Loan Facilities has
occurred; (b) no assignment or novation shall become effective with respect to
all or any portion of any Initial Lender’s commitments in respect of the Term
Loan Facilities until after the initial funding of all of the Term Loan
Facilities; and (c) each Initial Lender shall retain exclusive control over all
rights and obligations with respect to its commitments in respect of the Term
Loan Facilities, including all rights with respect to consents, modifications,
supplements, waivers and amendments, until the Closing Date has occurred and the
initial funding under the Term Loan Facilities has been made. Such assistance
shall include (a) your providing and (subject to customary non-reliance
agreements) causing your advisors to provide, and, to the extent provided for in
the Acquisition Agreement, using your commercially reasonable efforts to cause
the Acquired Business, its subsidiaries and its advisors to provide, the Lead
Arrangers upon request with all customary and reasonably available information
reasonably deemed necessary by the Lead Arrangers to complete such syndication,
including, but not limited to (x) customary and reasonably available information
relating to the Transaction as may be reasonably requested by us (including the
Projections (as hereinafter defined) and (y) customary forecasts prepared by
management of the Borrower of balance sheets, income statements and cash flow
statements for each fiscal quarter for the first twelve months following the
Closing Date and for each year commencing with the first fiscal year following
the Closing Date and for each of the succeeding fiscal years thereafter through
2022; (b) your assistance in the preparation of a customary information
memorandum with respect to the Term Loan Facilities (an “Information
Memorandum”)

 

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and other customary materials to be used in connection with the syndication of
the Term Loan Facilities (collectively with the Summary of Terms and any
additional summary of terms prepared for distribution to Lenders, the
“Information Materials”); (c) your using your commercially reasonable efforts to
make your appropriate management available to participate in the marketing of
the Term Loan Facilities at mutually agreed upon times and locations following
the completion of the Information Memorandum; (d) your using commercially
reasonable efforts to ensure that the syndication efforts of the Lead Arrangers
benefit from your existing lending relationships, if any, and, to the extent
provided for in the Acquisition Agreement, the existing banking relationships of
the Acquired Business; (e) your using commercially reasonable efforts to obtain,
prior to the launch of syndication of the Term Loan Facilities, monitored public
corporate credit or family ratings (but not any specific rating) for you after
giving effect to the Transaction and ratings of the Term Loan Facilities from
Moody’s Investors Service, Inc. (“Moody’s”) and Standard & Poor’s Ratings
Services, a Standard & Poor’s Financial Services LLC business (“S&P”)
(collectively, the “Ratings”); (f) until the later of the Syndication Date and
the Closing Date, your ensuring, and with respect to the Acquired Business,
using your commercially reasonable efforts to ensure, to the extent not in
contravention of the Acquisition Agreement, that none of the Companies shall
syndicate or issue, attempt to syndicate or issue, or announce or authorize the
announcement of the syndication or issuance of, any debt of the Companies (other
than the Term Loan Facilities), in each case, that would materially and
adversely affect the primary syndication of the Term Loan Facilities without the
prior written consent (not to be unreasonably withheld) of the Lead Arrangers
(it being understood that borrowings under the existing revolving credit
facility of the Target, ordinary course capital lease, purchase money and
equipment financings of any of the Companies and other indebtedness permitted to
be outstanding or issued under the Acquisition Agreement shall be permitted);
and (f) your making appropriate officers of you, and, to the extent provided for
in the Acquisition Agreement, using your commercially reasonable efforts to make
the appropriate officers of the Acquired Business, available from time to time
upon reasonable advance notice to attend and make presentations regarding the
business and prospects of the Companies and the Transaction at a reasonable
number of meetings of prospective Lenders at mutually agreed upon times and
locations. Notwithstanding anything to the contrary contained in this Commitment
Letter or the Fee Letter or any other letter agreement or undertaking concerning
the financing of the Transaction to the contrary, neither the obtaining of the
Ratings referenced above nor the compliance with any of the other provisions set
forth in clauses (a) through (f) above or any other provision of this paragraph
shall constitute a condition to the commitments hereunder or the funding of the
Term Loan Facilities on the Closing Date.

It is understood and agreed that the Lead Arrangers will manage and control all
aspects of the syndication of the Term Loan Facilities in consultation with you,
including any titles offered to prospective Lenders (subject to your consent
rights set forth herein and your rights of appointment set forth in paragraph 1
and excluding Disqualified Lenders), when commitments will be accepted, the
final allocations of the commitments among the Lenders and the amount and
distribution of the fees among the Lenders. It is further understood that the
Initial Lenders’ commitments hereunder are not conditioned upon the syndication
of, or receipt of commitments in respect of, the Term Loan Facilities and in no
event shall the commencement of successful completion of syndication of the Term
Loan Facilities constitute a condition to availability of the Term Loan
Facilities on the Closing Date.

3. Information Requirements. You hereby represent and warrant (with respect to
Information relating to the Acquired Business, to your knowledge) that (a) all
written factual information, other than Projections (as defined below), budgets,
estimates and other forward-looking information or information of a general
economic or industry nature, that has been or is hereafter made available to the
Lead Arrangers or any of the Lenders by or on behalf of you or any of your
representatives in connection with any aspect of the Transaction (including such
information, to your knowledge, relating to the Acquired Business) (the
“Information”) is and will be correct when taken as a whole, in all material
respects, and does not and will not, taken as a whole, contain any untrue
statement of a fact or omit to state

 

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a fact necessary to make the statements contained therein, in the light of the
circumstances under which they were made, not materially misleading (in each
case, after giving effect to all supplements and updates with respect thereto)
and (b) all financial projections concerning the Companies that have been or are
hereafter made available to the Lead Arrangers or any of the Lenders by or on
behalf of you or any of your representatives (the “Projections”) (to your
knowledge, in the case of Projections provided by the Acquired Business) have
been or will be prepared in good faith based upon assumptions believed by you to
be reasonable at the time provided (it being understood and agreed that the
Projections are as to future events and are not to be viewed as facts or a
guarantee of performance or achievement, that the Projections are subject to
significant uncertainties and contingencies, many of which are beyond your
control, and that actual results may differ from the Projections and such
differences may be material). You agree that if at any time prior to the later
of (a) the earlier of (i) the date on which a Successful Syndication (as defined
in the Fee Letter) is achieved and (ii) 45 days following the Closing Date (the
earlier of such dates, the “Syndication Date”) and (b) the Closing Date, any of
the representations in the preceding sentence would be incorrect in any material
respect if the Information and Projections were being furnished, and such
representations were being made, at such time, then you will promptly
supplement, or cause to be supplemented (or in the case of Information or
Projections relating to the Acquired Business, you will promptly notify the Lead
Arrangers upon becoming aware that any such Information or Projections are
incorrect in any material respect and, to the extent provided for in the
Acquisition Agreement, will use commercially reasonable efforts to supplement),
the Information and Projections so that such representations (to your knowledge,
in the case of the Acquired Business) will be correct in all material respects
at such time, it being understood in each case that such supplementation shall
cure any breach of such representation and warranty. In issuing this commitment
and in arranging and syndicating the Term Loan Facilities, the Commitment
Parties are and will be using and relying on the Information and the Projections
without independent verification thereof. For the avoidance of doubt, nothing in
this paragraph will constitute a condition to the availability of the Term Loan
Facilities on the Closing Date.

You acknowledge that (a) the Lead Arrangers on your behalf will make available,
on a confidential basis, Information Materials to the proposed syndicate of
Lenders by posting the Information Materials on IntraLinks or another similar
electronic system (the “Platform”) and (b) certain prospective Lenders (such
Lenders, “Public Lenders”; all other Lenders, “Private Lenders”) may have
personnel that do not wish to receive material non-public information (within
the meaning of the United States federal securities laws, “MNPI”) with respect
to the Companies, their respective affiliates or any other entity, or the
respective securities of any of the foregoing, and who may be engaged in
investment and other market-related activities with respect to such entities’
securities. If requested, you will assist the Lead Arrangers in preparing an
additional version of the Information Materials not containing MNPI (the “Public
Information Materials”) to be distributed to prospective Public Lenders.

Before distribution of any Information Materials (a) to prospective Private
Lenders, you shall provide the Lead Arrangers with a customary letter
authorizing the dissemination of the Information Materials; and (b) to
prospective Public Lenders, you shall provide the Lead Arrangers with a
customary letter authorizing the dissemination of the Public Information
Materials and confirming the absence of MNPI therefrom and, in each case, which
exculpate the Companies and us and our affiliates with respect to any liability
related to the use of the contents of the Information Materials or related
marketing materials by the recipients thereof. In addition, you hereby agree
that (x) you will use commercially reasonable efforts to identify (and, at the
reasonable request of the Lead Arrangers or the Administrative Agent (or its
affiliates), shall identify) that portion of the Information Materials that may
be distributed to the Public Lenders by clearly and conspicuously marking the
same as “PUBLIC”; (y) all Information Materials marked “PUBLIC” are permitted to
be made available through a portion of the Platform designated “Public
Investor”; and (z) the Lead Arrangers and the Administrative Agent (and its
affiliates) shall be entitled to treat any Information Materials that are not
marked “PUBLIC” as being suitable only for posting on a portion of the Platform
not designated “Public Investor.”

 

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You agree that, subject to the confidentiality and other provisions of this
Commitment Letter, the Lead Arrangers and the Administrative Agent (and its
affiliates) on your behalf may distribute the following documents to all
prospective Lenders, unless you advise the Lead Arrangers and Administrative
Agent in writing (including by email) within a reasonable time prior to their
intended distributions that such material should only be distributed to
prospective Private Lenders (provided that such materials have been provided to
you and your counsel for review a reasonable period of time prior thereto): (a)
administrative materials for prospective Lenders such as lender meeting
invitations and funding and closing memoranda, (b) notifications of changes to
the terms of the Term Loan Facilities and (c) drafts approved in writing by you
and the Administrative Agent (or its affiliates) and final versions of
definitive documents with respect to the Term Loan Facilities. If you advise the
Lead Arrangers and the Administrative Agent that any of the foregoing items
should be distributed only to Private Lenders, then the Lead Arrangers and the
Administrative Agent will not distribute such materials to Public Lenders
without your prior consent. You agree that Information Materials made available
to prospective Public Lenders in accordance with this Commitment Letter shall
not contain MNPI.

4. Fees and Indemnities.

(a) You agree to reimburse the Commitment Parties from time to time upon receipt
of a reasonably detailed invoice therefor for all reasonable and documented
out-of-pocket fees and expenses (in the case of fees and expenses of counsel,
limited to the reasonable and documented out-of-pocket fees, disbursements and
other out-of-pocket expenses of (x) one firm of lead counsel to the Commitment
Parties (it being understood and agreed that Cahill Gordon & Reindel LLP shall
act as counsel to the Commitment Parties) and (y) one firm of local counsel in
each relevant jurisdiction reasonably retained by the Administrative Agent)
incurred in connection with the Term Loan Facilities, the syndication thereof,
the preparation of the Credit Documentation (as defined below) therefor and the
other transactions contemplated hereby, whether or not the Closing Date occurs
or any of the Credit Documentation is executed and delivered or any extensions
of credit are made under the Term Loan Facilities; provided that if the Closing
Date does not occur and no termination fee is paid to you pursuant to Section
9.2(b) of the Acquisition Agreement, the aggregate reimbursement by you of such
fees and expenses shall not exceed $250,000. Such amounts shall be paid on the
earlier of (i) the Closing Date or (ii) three (3) business days following the
termination of this Commitment Letter as provided below (the “Payment Date”), in
each case to the extent you have received a reasonably detailed invoice at least
three (3) business days in advance of the Payment Date. You agree to pay (or
cause to be paid) the fees set forth in the separate fee letter addressed to you
dated the date hereof from the Commitment Parties (the “Fee Letter”), if and to
the extent payable.

(b) You also agree to indemnify and hold harmless each of the Commitment
Parties, each other Lender and each of their affiliates, successors and assigns
and their respective partners, officers, directors, employees, trustees, agents,
advisors, controlling persons and other representatives involved in the
Transaction (each, an “Indemnified Party”) from and against (and will reimburse
each Indemnified Party within 30 days following written demand (accompanied by
reasonable back-up therefor)) any and all claims, damages, losses, liabilities
and reasonable and documented out-of-pocket expenses (including, without
limitation, the reasonable and documented fees, disbursements and other charges
of one firm of counsel for all such Indemnified Parties, taken as a whole and,
if necessary, by a single firm of local counsel in each appropriate jurisdiction
(which may include a single firm of special counsel acting in multiple
jurisdictions) for all such Indemnified Parties, taken as a whole (and, in the
case of a conflict of interest where the Indemnified Party affected by such
conflict notifies you of the existence of such conflict and thereafter retains
its own counsel, by another firm of counsel for all such affected Indemnified
Parties)) of amounts payable by you pursuant to clause (a) above) that may be
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of (including, without
limitation, in connection with any investigation, litigation or proceeding or
preparation

 

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of a defense in connection therewith) (a) any aspect of the Transaction or any
of the other transactions contemplated thereby or (b) the Term Loan Facilities,
or any use made or proposed to be made with the proceeds thereof, in each case,
except to the extent such claim, damage, loss, liability or expense (A) is found
in a final non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party’s (or any of its affiliate’s or related
party’s) gross negligence, bad faith or willful misconduct, (B) arises from a
breach of such Indemnified Party’s (or any of its affiliate’s or related
party’s) obligations hereunder (C) arises from a proceeding by an Indemnified
Party against an Indemnified Party (or any of their respective affiliates or
related parties) (other than an action involving (i) conduct by you or any of
your affiliates or (ii) against an arranger or administrative agent in its
capacity as such) or (D) resulted from any agreement governing any settlement by
such Indemnified Party that is effective without your prior written consent
(which consent shall not be unreasonably withheld). In the case of any claim,
litigation, investigation or proceeding (any of the foregoing, a “Proceeding”)
to which the indemnity in this paragraph applies, such indemnity shall be
effective whether or not such Proceeding is brought by you, your equity holders
or creditors or an Indemnified Party, whether or not an Indemnified Party is
otherwise a party thereto and whether or not any aspect of the Transaction is
consummated. It is agreed that none of you (or any of your subsidiaries), the
Target (or any of its subsidiaries) or any Indemnified Party shall be liable for
any indirect, special, punitive or consequential damages (including, without
limitation, any loss of profits, business or anticipated savings) in connection
with this Commitment Letter, the Fee Letter or with respect to any activities
related to the Term Loan Facilities, including the preparation of this
Commitment Letter, the Fee Letter and the Credit Documentation. It is further
agreed that the Commitment Parties shall only have liability to you (as opposed
to any other person), and that the Commitment Parties shall be severally liable
solely in respect of their respective commitments to the Term Loan Facilities
and agreements set forth herein, on a several, and not joint, basis with any
other Lender. Notwithstanding any other provision of this Commitment Letter, no
Indemnified Party shall be liable for any damages arising from the use by others
of information or other materials obtained through electronic telecommunications
or other information transmission systems, other than for direct, actual damages
resulting from the gross negligence, bad faith or willful misconduct of such
Indemnified Party (or any of its affiliates or related parties) as determined by
a final non-appealable judgment of a court of competent jurisdiction. You shall
not, without the prior written consent of an Indemnified Party, such consent not
to be unreasonably withheld, effect any settlement of any pending or threatened
Proceeding against an Indemnified Party in respect of which indemnity could have
been sought hereunder by such Indemnified Party unless (i) such settlement
includes an unconditional release of such Indemnified Party from all liability
or claims that are the subject matter of such Proceeding and (ii) does not
include any statement as to any admission of liability. In case any Proceeding
is instituted involving any Indemnified Party for which indemnification is to be
sought hereunder by such Indemnified Party, then such Indemnified Party will
promptly notify you of the commencement of any Proceedings. You shall not be
liable for any settlement of any Proceeding affected without your written
consent (which consent shall not be unreasonably withheld).

5. Conditions to Financing. The commitment of each Initial Lender with respect
to the initial funding of the Term Loan Facilities is subject solely to (a) the
satisfaction (or waiver by the Lead Arrangers) of each of the conditions set
forth in Annex II hereto and (b) the execution and delivery of customary
definitive credit documentation by the Borrower and the Guarantors with respect
to the Term Loan Facilities consistent with this Commitment Letter and the Fee
Letter and subject in all respects to the Funds Certain Provisions and giving
effect to the Documentation Standard (as defined in Annex I)) (the “Credit
Documentation”) prior to such initial funding. There are no conditions (implied
or otherwise) to the commitments hereunder, and there will be no conditions
(implied or otherwise) under the Credit Documentation to the funding of the Term
Loan Facilities on the Closing Date, other than those that are expressly
referred to in the immediately preceding sentence.

 

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Notwithstanding anything in this Commitment Letter, the Fee Letter, the Credit
Documentation or any other letter agreement or other undertaking concerning the
financing of the Transaction to the contrary, (a) the Credit Documentation shall
be in a form such that the terms thereof do not impair availability of the Term
Loan Facilities on the Closing Date if the conditions in this paragraph 5 shall
have been satisfied or waived by the Lead Arrangers (it being understood that to
the extent any security interest in Collateral (including the creation or
perfection of any security interest) (other than any Collateral the security
interest in which may be perfected by the filing of a UCC financing statement or
the delivery of certificates, if any, evidencing equity interests of any
material wholly-owned restricted domestic subsidiary of the Borrower and the
subsidiary Guarantors that is part of the Collateral) is not perfected or
provided on the Closing Date after your use of commercially reasonable efforts
to do so without undue burden or expense, the provision and perfection of such
Collateral and security interest shall not constitute a condition precedent to
the availability of the Term Loan Facilities on the Closing Date but shall be
required to be perfected not later than 90 days (subject to extensions as may be
agreed to by the Administrative Agent) after the Closing Date pursuant to
arrangements to be mutually agreed by the Borrower and Administrative Agent),
and (b) the only representations and warranties the accuracy of which shall be a
condition to the availability of the Term Loan Facilities on the Closing Date
shall be (x) such of the representations made by the Target in the Acquisition
Agreement as are material to the interests of the Lenders, but only to the
extent that you (or your affiliate) have the right (taking into account any
applicable notice and cure provisions) to terminate your (and/or its)
obligations under the Acquisition Agreement or decline to consummate the
Acquisition (in each case, in accordance with the terms thereof) as a result of
a breach of such representations in the Acquisition Agreement (to such extent,
the “Acquisition Agreement Representations”) and (y) the Specified
Representations (as defined below). “Specified Representations” shall mean the
representations and warranties of the Borrower and Target in the Credit
Documentation relating to: (i) (A) corporate status of the Borrower and the
Target and (B) corporate power and authority to enter into the Credit
Documentation by the Borrower and the Target, (ii) due authorization, execution,
delivery and enforceability of the Credit Documentation by the Borrower and the
Target, (iii) no conflicts of the Credit Documentation with charter documents of
the Borrower and the Target, (iv) compliance with Federal Reserve margin
regulations and the use of proceeds of borrowing under the Term Loan Facilities
on the Closing Date not violating OFAC, AML, FCPA and the U.S.A. Patriot Act,
(v) the Investment Company Act, (vi) solvency of the Borrower and its
subsidiaries on a consolidated basis and on a pro forma basis for the
Transaction (such representations to be substantially identical to those set
forth in the Solvency Certificate attached as Annex III to the Commitment Letter
(the “Solvency Certificate”)), and (vii) subject to the limitations set forth in
this paragraph, the creation, validity and perfection of the security interests
granted in the Collateral. The provisions of this paragraph are referred to
herein as the “Funds Certain Provisions”.

Each of the parties hereto agrees that each of this Commitment Letter and the
Fee Letter is a binding and enforceable agreement (subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization and other similar
laws relating to or affecting creditors’ rights generally and general principles
of equity (whether considered in a proceeding in equity or law)) with respect to
the subject matter contained herein, including an agreement to negotiate in good
faith the Credit Documentation by the parties hereto in a manner consistent with
this Commitment Letter and, to the extent applicable, the Fee Letter, it being
acknowledged and agreed that the funding of the Term Loan Facilities is subject
only to the conditions precedent as set forth in this paragraph 5. For clarity,
all terms referenced herein to being defined in the Credit Documentation shall
be defined in accordance with the Documentation Standard (unless otherwise
provided for herein).

6. Confidentiality and Other Obligations. This Commitment Letter and the Fee
Letter and the contents hereof and thereof are confidential and may not be
disclosed in whole or in part to any person or entity without the prior written
consent of the Commitment Parties (not to be unreasonably withheld, conditioned
or delayed) except (i) this Commitment Letter and the Fee Letter and contents

 

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hereof and thereof may be disclosed (A) on a confidential basis to your
subsidiaries, directors, officers, employees, accountants, attorneys and other
representatives and professional advisors who need to know such information in
connection with the Transaction and are informed of the confidential nature of
such information, (B) pursuant to the order of any court or administrative
agency in any pending legal or administrative proceeding, or otherwise as
required by applicable law or stock exchange requirement or compulsory legal
process (in which case you agree to use commercially reasonable efforts to
inform the Commitment Parties promptly thereof prior to such disclosure to the
extent permitted by applicable law), and (C) on a confidential basis to the
affiliates, members, partners, stockholders, equity holders, controlling
persons, directors, officers, employees, accountants, attorneys and other
representatives and professional advisors of the Acquired Business; provided
that any such disclosure of the Fee Letter shall be subject to customary
redaction of the fees and the economic “market flex” provisions contained
therein, (ii) Annex I and the existence of this Commitment Letter and the Fee
Letter (but not the contents of this Commitment Letter and the Fee Letter) may
be disclosed to Moody’s, S&P and any other rating agency on a confidential
basis, (iii) the aggregate amount of the fees (including upfront fees and
original issue discount) payable under the Fee Letter may be disclosed as part
of generic disclosure regarding sources and uses for closing of the Acquisition,
projections, and pro forma information (but without disclosing any specific
fees, market flex or other economic terms set forth therein), (iv) this
Commitment Letter and the Fee Letter may be disclosed on a confidential basis to
your auditors or persons performing customary accounting functions for customary
accounting purposes, including accounting for deferred financing costs, (v) to
the directors, officers, attorneys and other professional advisors of the Target
on a confidential “need to know” basis in connection with the Transaction;
provided that any disclosure of the Fee Letter and the contents thereof shall be
redacted in a manner satisfactory to the Commitment Parties, (vi) you may
disclose this Commitment Letter (but not the Fee Letter) and its contents in any
information memorandum or syndication distribution, as well as in any proxy
statement or other public filing or other marketing materials relating to the
Acquisition or the Term Loan Facilities, (vii) this Commitment Letter and the
Fee Letter may be disclosed to a court, tribunal or any other applicable
administrative agency or judicial authority in connection with the enforcement
of your rights hereunder (in which case you agree to inform the Commitment
Parties promptly thereof prior to such disclosure to the extent permitted by
applicable law) and (viii) you may disclose this Commitment Letter and the Fee
Letter and the contents of each thereof to any Additional Arranger in either
case to the extent in contemplation of appointing such person pursuant to
paragraph 1 of this Commitment Letter and to any such person’s affiliates and
its and their respective officers, directors, employees, agents, attorneys,
accountants and other advisors, on a confidential basis.

The Commitment Parties shall use all confidential information provided to them
by or on behalf of you hereunder solely for the purpose of providing the
services which are the subject of this Commitment Letter and otherwise in
connection with the Transaction and shall treat confidentially all such
information; provided, however, that nothing herein shall prevent any Commitment
Party from disclosing any such information (i) pursuant to the order of any
court or administrative agency or in any pending legal or administrative
proceeding, or otherwise as required by applicable law or compulsory legal
process (in which case such Commitment Party agrees to inform you promptly
thereof to the extent not prohibited by law, rule or regulation), (ii) upon the
request or demand of any regulatory authority having jurisdiction over such
Commitment Party or any of its affiliates, (iii) to the extent that such
information becomes publicly available other than by reason of disclosure in
violation of this Commitment Letter, the Fee Letter or other confidential
obligation owed by such Commitment Party, (iv) to such Commitment Party’s
affiliates, employees, legal counsel, independent auditors and other experts,
professionals or agents who need to know such information in connection with the
Transaction and are informed of the confidential nature of such information,
(v) for purposes of establishing a “due diligence” defense available under
securities laws, (vi) to the extent that such information is received by such
Commitment Party from a third party that is not to such Commitment Party’s
knowledge subject to confidentiality obligations to you, (vii) to the extent
that such information is independently developed by such Commitment Party,

 

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(viii) to potential Lenders, participants, assignees or any direct or indirect
contractual counterparties to any swap or derivative transaction relating to you
or your obligations under the Term Loan Facilities (other than a Disqualified
Lender), in each case, who agree to be bound by the terms of this paragraph (or
language not less restrictive than this paragraph or as otherwise reasonably
acceptable to you and such Commitment Party, including as may be agreed in any
confidential information memorandum or other marketing material), (ix) to
Moody’s and S&P and to Bloomberg, LSTA and similar market data collectors with
respect to the syndicated lending industry; provided that such information is
limited to Annex I and is supplied only on a confidential basis, or (x) with
your prior written consent. This paragraph shall terminate on the earlier of
(a) the initial funding under the Term Loan Facilities and (b) the second
anniversary of the date of this Commitment Letter.

You acknowledge that the Commitment Parties or their affiliates may be providing
financing or other services to parties whose interests may conflict with
yours. The Commitment Parties agree that they will not furnish confidential
information obtained from you to any of their other customers and will treat
confidential information relating to the Companies and their respective
affiliates with the same degree of care as they treat their own confidential
information. The Commitment Parties further advise you that they will not make
available to you confidential information that they have obtained or may obtain
from any other customer.

In connection with all aspects of each transaction contemplated by this
Commitment Letter, you acknowledge and agree, and acknowledge your affiliates’
understanding, that: (i) the Term Loan Facilities and any related arranging or
other services described in this Commitment Letter is an arm’s-length commercial
transaction between you and your affiliates, on the one hand, and the Commitment
Parties, on the other hand, (ii) the Commitment Parties have not provided any
legal, accounting, regulatory or tax advice with respect to any of the
transactions contemplated hereby and you have consulted your own legal,
accounting, regulatory and tax advisors to the extent you have deemed
appropriate, (iii) you are capable of evaluating, and understand and accept, the
terms, risks and conditions of the transactions contemplated hereby, (iv) in
connection with the financing transactions contemplated hereby and the process
leading to such transactions, each of the Commitment Parties has been, is, and
will be acting solely as a principal and has not been, is not, and will not be
acting as an advisor, agent or fiduciary for you or any of your affiliates,
stockholders, creditors or employees or any other party, (v) the Commitment
Parties have not assumed and will not assume an advisory, agency or fiduciary
responsibility in your or your affiliates’ favor with respect to any of the
financing transactions contemplated hereby or the process leading thereto, and
the Commitment Parties have no obligation to you or your affiliates with respect
to the financing transactions contemplated hereby except those obligations
expressly set forth in this Commitment Letter, and (vi) the Commitment Parties
and their respective affiliates may be engaged in a broad range of transactions
that involve interests that differ from yours and those of your affiliates, and
the Commitment Parties have no obligation to disclose any of such interests to
you or your affiliates. To the fullest extent permitted by law and without
limiting the provisions of paragraph 4(b), you hereby waive and release any
claims that you may have against the Commitment Parties with respect to any
breach or alleged breach of agency or fiduciary duty in connection with any
aspect of any financing transaction contemplated by this Commitment Letter.

The Commitment Parties hereby notify you that pursuant to the requirements of
the USA PATRIOT Act, Title III of Pub. L. 107-56 (signed into law October 26,
2001) (the “U.S.A. Patriot Act”), each of them is required to obtain, verify and
record information that identifies you and the Guarantors, which information
includes the name and address of such person and other information that will
allow the Commitment Parties, as applicable, to identify each such person in
accordance with the U.S.A. Patriot Act.

 

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7. Survival of Obligations. The provisions of paragraphs 2, 3, 4, 6 and 8 shall
remain in full force and effect regardless of whether any Credit Documentation
shall be executed and delivered and notwithstanding the termination of this
Commitment Letter or any commitment or undertaking of the Commitment Parties
hereunder, provided that (i) the provisions of paragraphs 2 and 3 shall not
survive if all of the commitments and undertakings of the Commitment Parties are
terminated by any party hereto prior to the effectiveness of the Term Loan
Facilities and (ii) if the Term Loan Facilities close and the Credit
Documentation is executed and delivered, the provisions of paragraphs 2 and 3
shall survive only until the Syndication Date and your obligations under this
Commitment Letter, other than your obligations in paragraphs 2 and 3,
confidentiality of the Fee Letter and paragraph 4 to the extent not addressed in
the Credit Documentation, shall automatically terminate and be superseded by the
provisions of the Credit Documentation upon the execution and delivery thereof,
and you shall automatically be released from all liability in connection
therewith at such time. You may terminate this Commitment Letter and/or the
Initial Lenders’ commitments with respect to any of the Term Loan Facilities (or
any portion thereof, including on a non-pro rata basis across the Term Loan
Facilities) hereunder at any time subject to the provisions of the preceding
sentence (any such commitment termination shall reduce the commitments of each
Initial Lender on a pro rata basis based on their respective commitments to the
relevant Term Loan Facility as of the date hereof).

8. Miscellaneous. This Commitment Letter and the Fee Letter may be executed in
multiple counterparts and by different parties hereto in separate counterparts,
all of which, taken together, shall be deemed an original. Delivery of an
executed counterpart of a signature page to this Commitment Letter or the Fee
Letter by telecopier, facsimile or other electronic transmission (e.g., a “pdf”
or “tiff”) shall be effective as delivery of a manually executed counterpart
thereof. Headings are for convenience of reference only and shall not affect the
construction of, or be taken into consideration when interpreting, this
Commitment Letter or the Fee Letter.

This Commitment Letter and the Fee Letter shall be governed by, and construed in
accordance with, the laws of the State of New York without regard to conflict of
law principles that would result in the application of any other laws other than
the state of New York; provided that, notwithstanding the foregoing, it is
understood and agreed that (a) interpretation the definition of “Company
Material Adverse Effect” (as defined in Annex II) or the equivalent term under
the Acquisition Agreement and whether a Company Material Adverse Effect (or the
equivalent term) has occurred, (b) the determination of the accuracy of any
Acquisition Agreement Representation and whether as a result of any inaccuracy
thereof you have the right (taking into account any applicable cure provisions)
to terminate your obligations under the Acquisition Agreement or decline to
consummate the Acquisition and (c) the determination of whether the Acquisition
has been consummated in accordance with the terms of the Acquisition Agreement,
in each case shall be governed by, and construed in accordance with, the laws of
the State of Delaware, regardless of the laws that might otherwise govern under
applicable principles of conflicts of law thereof. EACH PARTY HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO THIS COMMITMENT LETTER, THE FEE LETTER, THE TRANSACTION AND THE
OTHER TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY OR THE ACTIONS OF THE
COMMITMENT PARTIES IN THE NEGOTIATION, PERFORMANCE OR ENFORCEMENT HEREOF. Each
party hereto hereby irrevocably and unconditionally submits to the exclusive
jurisdiction of any New York State court or Federal court of the United States
of America sitting in the Borough of Manhattan in New York City in respect of
any suit, action or proceeding arising out of or relating to the provisions of
this Commitment Letter, the Fee Letter, the Transaction and the other
transactions contemplated hereby and thereby and irrevocably agrees that all
claims in respect of any such suit, action or proceeding may be heard and
determined in any such court. The parties hereto agree that service of any
process, summons, notice or document by registered mail addressed to you shall
be effective service of

 

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process against you for any suit, action or proceeding relating to any such
dispute. Each party hereto waives, to the fullest extent permitted by applicable
law, any objection that it may now or hereafter have to the laying of the venue
of any such suit, action or proceedings brought in any such court, and any claim
that any such suit, action or proceeding brought in any such court has been
brought in an inconvenient forum. A final judgment in any such suit, action or
proceeding brought in any such court may be enforced in any other courts to
whose jurisdiction the applicable party is or may be subject by suit upon
judgment.

This Commitment Letter, together with the Fee Letter and the administrative fee
letter between you and JPMCB dated the date hereof, embodies the entire
agreement and understanding among the parties hereto and your affiliates with
respect to the Term Loan Facilities and supersedes all prior agreements and
understandings relating to the subject matter hereof. No party has been
authorized by the Commitment Parties to make any oral or written statements that
are inconsistent with this Commitment Letter. Neither this Commitment Letter
(including the attachments hereto) nor the Fee Letter may be amended or any term
or provision hereof or thereof waived or modified except by an instrument in
writing signed by each of the parties hereto.

This Commitment Letter may not be assigned by you without our prior written
consent (and any purported assignment without such consent will be null and
void), is intended to be solely for the benefit of the parties hereto and is not
intended to confer any benefits upon, or create any rights in favor of, any
person other than the parties hereto (and the Indemnified Parties). Each
Commitment Party may assign its commitment hereunder, in whole or in part, to
any of its affiliates or, subject to the provisions of this Commitment Letter,
to any Lender; provided that, other than with respect to an assignment to which
you otherwise consent in writing (which consent, in the case of an assignment by
a Commitment Party to its affiliates, shall not be unreasonably withheld by
you), such Commitment Party shall not be released from the portion of its
commitment hereunder so assigned to the extent such assignee fails to fund the
portion of the commitment assigned to it on the Closing Date notwithstanding the
satisfaction of the conditions to funding set forth herein.

Please indicate your acceptance of the terms of the Term Loan Facilities set
forth in this Commitment Letter and the Fee Letter by returning to the Lead
Arrangers executed counterparts of this Commitment Letter and the Fee Letter not
later than 11:59 p.m. (New York City time) on June 15, 2016, whereupon the
undertakings of the parties with respect to the Term Loan Facilities shall
become effective to the extent and in the manner provided hereby. This offer
shall terminate with respect to the Term Loan Facilities if not so accepted by
you at or prior to that time. Thereafter, all commitments and undertakings of
the Commitment Parties hereunder will expire, unless extended by us in our sole
discretion, on the earliest of (a) 11:59 p.m., New York City time, on November
12, 2016, unless the Closing Date occurs on or prior thereto, (b) as to any
Facility, the consummation of the Merger without the use of such Facility and
(c) the termination of the Acquisition Agreement by you in a signed writing in
accordance with its terms.

[The remainder of this page intentionally left blank.]

 

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We are pleased to have the opportunity to work with you in connection with this
important financing.

 

Very truly yours, JPMORGAN CHASE BANK, N.A. By:  

/s/ Timothy D. Lee

  Name:   Timothy D. Lee   Title:   Vice President

 

Signature Page to Project Quasar Commitment Letter

--------------------------------------------------------------------------------

The provisions of this Commitment Letter are accepted and agreed to as of the
date first written above: CAVIUM, INC. By:  

/s/ Syed Ali

  Name:   Syed Ali   Title:   President and Chief Executive Officer

 

Signature Page to Project Quasar Commitment Letter

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ANNEX I

SUMMARY OF TERMS AND CONDITIONS

$650,000,000 TERM B LOAN FACILITY

$100,000,000 INTERIM TERM LOAN FACILITY

Capitalized terms not otherwise defined herein have the same meanings as
specified therefor in the Commitment Letter to which this Annex I is attached.

 

Borrower:    Cavium, Inc., a Delaware corporation (the “Borrower”).    The
Credit Documentation will permit a newly formed Cayman Islands company to which,
directly or indirectly through one or more of its subsidiaries, substantially
all of the assets of the Target (excluding, certain tangible U.S. assets, will
be transferred (via a contribution of the Target and conversion of the Target to
a limited liability company) (such transfer and conversion, the “Outbound F
Reorganization”)) to assume, on December 30, 2016, the obligations of the
Borrower in respect of the Interim Term Loan Facility pursuant to loan
documentation to be agreed (the “Assumption”) subject to (i) no default or event
of default, (ii) receipt of customary deliverables, (iii) arrangements with
respect to minimum cash at the Cayman Islands company and its subsidiaries
reasonably satisfactory to the Lenders under the Interim Term Loan Facility,
(iv) arrangements such that, on January 2, 2017, following the consummation of
the Assumption, the Interim Term Loan Facility shall be guaranteed by
substantially all of the Borrower’s foreign subsidiaries and secured by
substantially all of the assets of such foreign subsidiaries, in each case
subject to limitations to be agreed and (v) other customary closing conditions.
Guarantors:    The obligations of the Borrower under the Term Loan Facilities
(as hereinafter defined) will be unconditionally guaranteed jointly and
severally on a senior basis (the “Guarantees”) by each of the Borrower’s
wholly-owned material restricted U.S. subsidiaries (and consistent with the
principles set forth herein) (collectively, the “Guarantors”); provided that
Guarantors shall not include (i) unrestricted subsidiaries, (ii) immaterial
subsidiaries (to be defined in a mutually acceptable manner as to individual and
aggregate revenues or assets excluded), (iii) any subsidiary that is prohibited,
but only so long as such subsidiary is prohibited, by applicable law, rule or
regulation or by any contractual obligation existing on the Closing Date or
existing at the time of acquisition thereof after the Closing Date (so long as
such prohibition did not arise as part of such acquisition), in each case, from
guaranteeing the Term Facilities or which would require governmental (including
regulatory) consent, approval, license or authorization to provide a Guarantee
unless such consent, approval, license or authorization has been received (but
without obligation to seek the same), (iv) any direct or indirect subsidiary of
a “controlled foreign corporation” within the meaning of Section 957 of the
Internal Revenue Code of 1986, as amended (a “CFC”), (v) any CFC, (vi) any
domestic subsidiary with no material assets other than equity interests
(including, for this purpose, any debt or other instrument treated as equity for
U.S. federal income tax purposes) of one or more foreign subsidiaries that are
CFCs (a “Disregarded Domestic Person”), (vii) not-for-profit subsidiaries,
(viii) any other subsidiary with respect to

 

Annex I-1

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   which the Borrower (in consultation with the Administrative Agent) has
reasonably determined that the material adverse tax consequences of providing a
guarantee shall be excessive relation to of the benefits to be obtained by the
Lenders therefrom, and (ix) special purpose entities. In addition, the Credit
Documentation will contain carve outs for “non-ECP Guarantors”, consistent with
the LSTA provisions. All guarantees will be guarantees of payment and not of
collection. The Target and its subsidiaries included in the Acquired Business
that are not excluded from the foregoing requirements pursuant to the terms
described above shall be required to become Guarantors (and grant liens in their
assets constituting Collateral that can be perfected by filing UCC financing
statements) on the Closing Date. Notwithstanding the forgoing, it is understood
and agreed that neither the Target nor any of its subsidiaries shall be required
to be Guarantors until the Merger is consummated on the Merger Closing Date.   
Notwithstanding the foregoing, additional subsidiaries may be excluded from the
guarantee requirements in circumstances where the Borrower and the
Administrative Agent reasonably agree that the cost of providing such a
guarantee is excessive in relation to the value afforded thereby. Administrative
and Collateral Agent:    JPMCB will act as sole and exclusive administrative and
collateral agent for the Lenders (the “Administrative Agent”). Joint Lead
Arrangers and Joint Bookrunners:    JPMCB and any Additional Arrangers appointed
in accordance with Section 1 of the Commitment Letter will act as joint lead
arrangers and joint bookrunners for the Term Loan Facilities (in such
capacities, the “Lead Arrangers”); provided that JPMCB may perform its
responsibilities hereunder as a Lead Arranger through its affiliate, J.P. Morgan
Securities LLC. Lenders:    Banks, financial institutions and institutional
lenders selected by the Lead Arrangers in consultation with and reasonably
acceptable to the Borrower and excluding any Disqualified Lenders and, after the
initial funding of the Term Loan Facilities, subject to the restrictions set
forth in the Assignments and Participations section below (the “Lenders”). Term
Loan Facilities:    (a) A senior secured first lien term loan B facility (the
“Term B Loan Facility”) in an aggregate principal amount of $650 million.    (a)
A senior secured first lien interim term loan facility (the “Interim Term Loan
Facility” and, together with the Term B Loan Facility, the “Term Loan
Facilities”) in an aggregate principal amount of $100 million. Purpose:    The
proceeds of the borrowings under the Term Loan Facilities, together with cash on
the balance sheet of the Companies, shall be used (i) to finance the Acquisition
and the Refinancing and (ii) to pay fees and expenses incurred in connection
therewith.

 

Annex I-2

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Availability:    The Term Loan Facilities will be available in a single drawing
on the Closing Date; provided that in the event the Merger Date does not occur
on the Closing Date, a portion of the proceeds of the Term Loan Facilities
sufficient to pay the consideration in the Merger shall be deposited in escrow
pending consummation of the Merger with JPMCB as escrow agent; provided,
however, that the only conditions to the release of the escrowed funds to the
Borrower shall be the conditions to the funding of the Term Loan Facilities
described in paragraph 5 of the Commitment Letter. Amounts borrowed under the
Term Loan Facilities that are repaid or prepaid may not be reborrowed. Interest
Rates:    The interest rates per annum applicable to each Term Loan Facility
will be, at the option of the Borrower, (i) LIBOR plus the Applicable Margin (as
hereinafter defined) or (ii) the Base Rate plus the Applicable Margin. The
Applicable Margin means (x) with respect to the Term B Loan Facility, 4.00% per
annum, in the case of LIBOR advances, and 3.00% per annum, in the case of Base
Rate advances and (y) with respect to the Interim Term Loan Facility, 2.00% per
annum, in the case of LIBOR advances, and 1.00% per annum, in the case of Base
Rate advances.    The Borrower may select interest periods of one, two, three or
six months (and, if agreed to by all applicable Lenders, a period shorter than
one month or a period of twelve months) for LIBOR advances. Interest shall be
payable at the end of the selected interest period, but no less frequently than
quarterly.    “LIBOR” and “Base Rate” will have meanings customary and
appropriate for financings of this type; provided that (x) LIBOR will be deemed
to be not less than (i) with respect to the Term B Loan Facility, 0.75% per
annum (the “LIBOR Floor”) and (ii) with respect to the Interim Term Loan
Facility, 0% per annum and (y) the Base Rate will be deemed to be not less than
100 basis points higher than one-month LIBOR (after giving effect to the LIBOR
Floor).    During the continuance of an event of default for non-payment of
principal, interest or fees, interest will accrue on such overdue principal,
interest or fees at the Default Rate (as defined below). During the continuance
of a bankruptcy event of default, the principal amount of all outstanding
obligations will bear interest at the Default Rate. As used herein, “Default
Rate” means (i) on the principal of any loan at a rate of 200 basis points in
excess of the rate otherwise applicable to such loan and (ii) on any other
overdue amount at a rate of 200 basis points in excess of the non-default rate
of interest then applicable to Base Rate loans.

 

Annex I-3

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Calculation of Interest:    Other than calculations in respect of interest at
the Base Rate when calculated by reference to the Administrative Agent’s prime
rate (which shall be made on the basis of actual number of days elapsed in a
365/366 day year), all calculations of interest shall be made on the basis of
actual number of days elapsed in a 360-day year. Cost and Yield Protection:   
Subject to the Documentation Standard (as defined below) and customary for
transactions and facilities of this type, including, without limitation, in
respect of breakage or redeployment costs incurred in connection with
prepayments (other than loss of margin), changes in capital adequacy and capital
requirements or their interpretation, illegality, unavailability, reserves
without proration or offset and payments free and clear of withholding or other
taxes; provided that for all purposes of the Credit Documentation, (i) the
Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests,
rules, guidelines and directives promulgated thereunder and (ii) all requests,
rules, guidelines or directives promulgated by the Bank for International
Settlements, the Basel Committee on Banking Supervision (or any successor or
similar authority) or the United States regulatory authorities, in each case,
pursuant to Basel III, shall be deemed introduced or adopted after the Closing
Date, so long as, in each case, any amounts with respect thereto assessed by any
Lender shall also be so assessed by such Lender against its similarly situated
customers generally under agreements containing comparable yield protection
provisions. Maturity:    The Term B Loan Facility will mature on the date that
is 6 years after the Closing Date. The Interim Term Loan Facility will mature on
February 15, 2017. The Credit Documentation shall contain customary “amend and
extend” provisions pursuant to which individual Lenders may agree to extend the
maturity date of their outstanding loans or loans under any Term Loan Facility
or any Incremental Facility (which may include, among other things, an increase
in the interest rate payable in respect of such extended loans, with such
extensions not subject to any “default stoppers”, financial tests or “most
favored nation” pricing provisions) upon the request of the Borrower and without
the consent of any other Lender (it is understood that (i) no existing Lender
will have any obligation to commit to any such extension and (ii) each Lender
under the class being extended shall have the opportunity to participate in such
extension on the same terms and conditions as each other Lender under such
class). Incremental Facilities:    Following the repayment in full of the
Interim Term Loan Facility, the Credit Documentation will permit the Borrower to
(a) add one or more incremental term loan facilities to the Term Loan Facilities
or to increase the existing Term B Loan Facility (each, an “Incremental Term
Facility”) and/or (b) add one or more incremental revolving credit facilities
(each an “Incremental Revolving Facility” and, together with the Incremental
Term Facility, the “Incremental Facilities” and each an “Incremental Facility”)
in an aggregate principal amount of up to (x) $150,000,000 plus (y) all
voluntary prepayments of the Term Loan Facilities

 

Annex I-4

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   and voluntary prepayments of revolving loans to the extent accompanied by a
permanent reduction of the revolving commitments made prior to such date of
incurrence and not funded with the proceeds of long term debt plus (z) an
unlimited amount so long as, in the case of clause (z) only, on a pro forma
basis the First Lien Leverage Ratio (as defined below) would not exceed
2.50:1.00, after giving effect to any acquisition consummated in connection
therewith and all other appropriate pro forma adjustments (in the case of any
Incremental Revolving Facility, calculated assuming the entire amount of such
Incremental Revolving Facility was drawn on such date) (it being understood that
the Borrower shall be deemed to have used amounts under clause (y) prior to
utilization of amounts under clause (x) or (z), and the Borrower shall be deemed
to have used amounts under clause (z) (to the extent compliant therewith) prior
to utilization of amounts under clause (x)); provided that (i) no Lender will be
required to participate in any such Incremental Facility, (ii) subject to
customary limited conditionality provisions in connection with any Incremental
Facility incurred to finance a permitted acquisition or similar investment, no
event of default or default exists or would exist after giving effect thereto,
(iii) subject to customary limited conditionality provisions in connection with
any Incremental Facility incurred to finance a permitted acquisition or similar
investment, the representations and warranties in the Credit Documentation shall
be true and correct in all material respects, (iv) the maturity date of any such
Incremental Term Facility shall be no earlier than the maturity date for the
Term B Loan Facility, (v) the weighted average life to maturity of any
Incremental Term Facility shall be no shorter than the weighted average life to
maturity of the Term B Loan Facility, (vi) the interest margins for the
Incremental Facility shall be determined by the Borrower and the lenders of the
Incremental Facility; provided that in the event that the interest margins for
any Incremental Term Facility are greater than the Applicable Margin for the
Term B Loan Facility by more than 50 basis points, then the Applicable Margin
for the Term B Loan Facility shall be increased to the extent necessary so that
the interest margins for the Incremental Term Facility are not more than 50
basis points higher than the Applicable Margin for the Term B Loan Facility;
provided, further, that in determining the interest margins applicable to the
Term B Loan Facility and the Applicable Margins for any Incremental Term
Facility, (x) original issue discount (“OID”) or upfront fees (which shall be
deemed to constitute like amounts of OID) payable by the Borrower for the
account of the Lenders of the Term B Loan Facility in the primary syndication
thereof shall be included (with OID being equated to interest based on an
assumed four-year life to maturity), (y) customary arrangement, structuring,
underwriting, amendment or commitment fees payable to one or more arrangers
shall be excluded, and (z) if the LIBOR or Base Rate floor for any Incremental
Term Facility is greater than the LIBOR or Base Rate floor, respectively, for
the existing Term B Loan Facility, the difference between such floor for the
Incremental Term Facility and the Term B Loan Facility shall be equated to an
increase in the Applicable Margin for purposes of this clause (vi) (all
adjustments made pursuant to this clause (vi), the “MFN Adjustment”); provided
that if any Incremental

 

Annex I-5

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   Term Facility is incurred after the date that is 18 months after the Closing
Date, the MFN Adjustment shall not apply, (vii) each Incremental Facility shall
be secured by pari passu liens on the Collateral (as hereinafter defined)
securing the Term B Loan Facility and no other assets and shall be guaranteed by
the Guarantors and no other persons and (viii) any Incremental Facility shall be
on terms and pursuant to documentation to be determined, provided that, to the
extent such terms and documentation are not consistent with the Term B Loan
Facility (except to the extent permitted by clause (i), (ii), (iii), (iv), (v)
or (vi) above, as applicable), they shall be reasonably satisfactory to the
Administrative Agent. The Borrower may seek commitments in respect of any
Incremental Facility from existing Lenders or from additional banks, financial
institutions and other institutional lenders reasonably acceptable to the
Administrative Agent who will become Lenders in connection therewith.
Refinancing Facilities:    The Credit Documentation will permit the Borrower to
refinance loans under the Term B Loan Facility or loans under any Incremental
Facility (each, “Refinanced Debt”) from time to time, in whole or part, with (x)
one or more new term facilities (each, a “Refinancing Term Facility”) under the
Credit Documentation with the consent of the Borrower, the Administrative Agent
and the institutions providing such Refinancing Term Facility or (y) one or more
series of unsecured notes or loans, notes secured by the Collateral on a pari
passu basis with the Term Loan Facilities or notes or loans secured by the
Collateral on a subordinated basis to the Term Loan Facilities, which will be
subject to customary intercreditor terms reasonably acceptable to the
Administrative Agent and the Borrower (any such notes or loans, “Refinancing
Notes” and together with the Refinancing Term Facilities, the “Refinancing
Indebtedness”); provided that (i) any Refinancing Term Facility or Refinancing
Notes do not mature prior to the maturity date of, or have a shorter weighted
average life than, the applicable Refinanced Debt (without giving effect to any
amortization or prepayments on the outstanding loans under the Term B Loan
Facility or loans made under any Incremental Facility, as applicable), (ii) any
Refinancing Notes consisting of notes do not mature prior to the maturity date
of the applicable Refinanced Debt or have any scheduled amortization, (iii)
there shall be no issuers, borrowers or guarantors in respect of any Refinancing
Indebtedness that are not the Borrower or a Guarantor, (iv) any Refinancing
Notes shall not contain any mandatory prepayment provisions (other than related
to customary asset sale and change of control offers or events of default) that
could result in prepayments of such Refinancing Notes prior to the maturity date
of the applicable Refinanced Debt, (v) the other terms and conditions of such
Refinancing Indebtedness (excluding pricing, interest rate margins, rate floors,
discounts, fees and optional prepayment or optional redemption provisions) are
not materially more favorable (when taken as a whole) to the lenders or
investors providing such Refinancing Indebtedness than the terms of the
applicable Refinanced Debt unless (1) Lenders under the corresponding Refinanced
Debt also receive the benefit of such more restrictive terms or (2) any such
provisions apply after the maturity date of the Term B Loan Facility and (vi)
the proceeds of

 

Annex I-6

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   such Refinancing Indebtedness (a) shall not be in an aggregate principal
amount greater than the aggregate principal amount of the applicable Refinanced
Debt plus any fees and premiums associated therewith, and costs and expenses
related thereto and (b) shall be immediately applied to permanently prepay in
whole or in part the applicable Refinanced Debt. Documentation Standard:    The
Credit Documentation for the Term Loan Facilities (i) shall be based upon the
Credit Agreement, dated February 26, 2016, of RPX Corporation with appropriate
modifications to baskets and materiality thresholds to reflect the size,
industry, leverage and ratings of the Borrower after giving effect to the
Acquisition and with appropriate modifications to reflect the structure of the
Term B Loan Facility as a “term B loan facility”, (ii) shall contain the terms
and conditions set forth in this Summary of Terms, (iii) shall reflect the
operational and strategic requirements of the Borrower and its subsidiaries
(after giving effect to the Acquisition) in light of their size, industries and
practices and (iv) shall reflect the customary agency and operational
requirements of the Administrative Agent (collectively, the “Documentation
Standard”), in each case, subject to the Funds Certain Provisions. The Credit
Documentation shall, subject to the “market flex” provisions contained in the
Fee Letter, contain only those conditions to borrowing, mandatory prepayments,
representations and warranties, covenants (affirmative, negative and financial)
and events of default expressly set forth in this Summary of Terms, in each
case, applicable to the Borrower and its restricted subsidiaries and, subject to
the Documentation Standard and limitations as set forth herein, with materiality
thresholds, standards, qualifications, exceptions, “baskets”, and grace and cure
periods to be mutually agreed and consistent with the Documentation Standard.
Limited Condition Acquisitions:    For purposes of (i) determining compliance
with any provision of the Credit Documentation which requires the calculation of
the First Lien Leverage Ratio or the Total Leverage Ratio, (ii) determining
compliance with representations, warranties, defaults or events of default or
(iii) testing availability under baskets set forth in the Credit Documentation
(including baskets measured as a percentage of Consolidated EBITDA), in each
case, in connection with an acquisition (or similar investment) by one or more
of the Borrower and its restricted subsidiaries of any assets, business or
person permitted to be acquired by the Credit Documentation, in each case whose
consummation is not conditioned on the availability of, or on obtaining, third
party financing (any such acquisition, a “Limited Condition Acquisition”), at
the option of the Borrower (the Borrower’s election to exercise such option in
connection with any Limited Condition Acquisition, an “LCA Election”), the date
of determination of whether any such action is permitted hereunder, shall be
deemed to be the date the definitive agreements for such Limited Condition
Acquisition are entered into (the “LCA Test Date”), and if, after giving pro
forma effect to the Limited Condition Acquisition and the other transactions to
be entered into in connection therewith as if they had occurred at

 

Annex I-7

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   the beginning of the most recent test period ending prior to the LCA Test
Date, the Borrower could have taken such action on the relevant LCA Test Date in
compliance with such ratio or basket, such ratio or basket shall be deemed to
have been complied with.    For the avoidance of doubt, if the Borrower has made
an LCA Election and any of the ratios or baskets for which compliance was
determined or tested as of the LCA Test Date are exceeded as a result of
fluctuations in any such ratio or basket (including due to fluctuations in pro
forma Consolidated EBITDA, including of the target of any Limited Condition
Acquisition) at or prior to the consummation of the relevant transaction or
action, such baskets or ratios will not be deemed to have been exceeded as a
result of such fluctuations; however, if any ratios improve or baskets increase
as a result of such fluctuations, such improved ratios or baskets may be
utilized. If the Borrower has made an LCA Election for any Limited Condition
Acquisition, then in connection with any subsequent calculation of any ratio or
basket on or following the relevant LCA Test Date and prior to the earlier of
(i) the date on which such Limited Condition Acquisition is consummated or (ii)
the date that the definitive agreement for such Limited Condition Acquisition is
terminated or expires without consummation of such Limited Condition
Acquisition, any such ratio or basket shall be calculated on a pro forma basis
assuming such Limited Condition Acquisition and other transactions in connection
therewith (including any incurrence of debt and the use of proceeds thereof)
have been consummated. Financial Definitions:    The “First Lien Leverage Ratio”
means the ratio of (i) debt for borrowed money of the Borrower and its
restricted subsidiaries that is secured on a senior or pari passu basis with the
Term Loan Facilities to (ii) trailing four-quarter EBITDA (as defined below).   
The “Total Leverage Ratio” means the ratio of (i) debt for borrowed money of the
Borrower and its restricted subsidiaries to (ii) trailing four-quarter EBITDA.
   Undrawn letters of credit shall not constitute debt for purposes of
calculating the First Lien Leverage Ratio or the Total Leverage Ratio.   
“EBITDA” is to be defined in a manner consistent with the Documentation Standard
beginning with Consolidated Net Income, with add-backs (and corresponding
deductions, to the extent applicable) to include, without limitation and without
duplication, the following:

 

   i.   expected cost savings, operating expense reductions, restructuring
charges and expenses and synergies related to the Transaction projected by the
Borrower in good faith to result from actions with respect to which substantial
steps have been, will be, or are expected to be, taken and which are expected to
be realized (in the good faith determination of the Borrower) on or prior to
December 31, 2017, which are factually supportable; provided that the aggregate
amount added back to EBITDA pursuant to

 

Annex I-8

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     this clause (i) and clause (ii) below in any test period shall not exceed
15% of EBITDA for such test period (calculated prior to giving effect to such
add-backs);    ii.   expected cost savings, operating expense reductions,
restructuring charges and expenses and synergies related to mergers and other
business combinations, acquisitions, divestitures, restructuring, cost savings
initiatives which are factually supportable and other similar initiatives and
projected by the Borrower in good faith to result from actions with respect to
which substantial steps have been, will be, or are expected to be, taken and
which are expected to be realized (in the good faith determination of the
Borrower) within 12 months after such transaction or initiative is consummated;
provided that the aggregate amount added back to EBITDA pursuant to this clause
(ii) and clause (i) above in any test period shall not exceed 15% of EBITDA for
such test period (calculated prior to giving effect to such add-backs);    iii.
  non-cash losses, charges and expenses (including non-cash compensation
charges);    iv.   extraordinary, unusual or non-recurring losses, charges and
expenses;    v.   cash restructuring and related charges and business
optimization expenses;    vi.   unrealized gains and losses due to foreign
exchange adjustments (including, without limitation, losses and expenses in
connection with currency and exchange rate fluctuations);    vii.   costs and
expenses in connection with the Transaction;    viii.   expenses or charges
related to any equity offering, permitted investment, acquisition, disposition,
recapitalization or incurrence of permitted indebtedness (whether or not
consummated), including non-operating or non-recurring professional fees, costs
and expenses related thereto;    ix.   interest, taxes, amortization and
depreciation; and    x.   losses from discontinued operations.

 

Scheduled Amortization:    The Term B Loan Facility shall be subject to
quarterly amortization of principal equal to 0.25% of the original aggregate
principal amount of the Term B Loan Facility, with the balance payable on the
final maturity date. The Interim Term Loan Facility shall not amortize and shall
be payable in full on the final maturity date. Mandatory Prepayments:    In
addition to the amortization set forth above and subject to the next two
paragraphs, mandatory prepayments required with respect to the Term B Loan
Facility shall be limited to: (i) subject to customary exceptions and thresholds
(with exceptions for, among others, ordinary course dispositions,

 

Annex I-9

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   dispositions of obsolete or worn-out property, property no longer used or
useful in the business and other exceptions to be mutually agreed), from the
receipt of net cash proceeds by the Borrower or any of its restricted
subsidiaries in excess of an amount to be mutually agreed from any disposition
of assets outside the ordinary course of business or casualty event by the
Borrower or any of its restricted subsidiaries, in each case, to the extent such
proceeds are not reinvested (or committed to be reinvested) in the business of
the Borrower or any of its subsidiaries within twelve months after the date of
receipt of such proceeds from such disposition or casualty event and, if so
committed to be reinvested, reinvested no later than 180 days after the end of
such twelve month period; (ii) following the receipt of net cash proceeds from
the issuance or incurrence after the Closing Date of additional debt of the
Borrower or any of its restricted subsidiaries (other than debt permitted under
the Credit Documentation other than Refinancing Indebtedness); and (iii) in an
amount equal to 50% of annual Excess Cash Flow (to be defined in the Credit
Documentation) of the Borrower and its restricted subsidiaries, beginning with
the first full fiscal year commencing after the Closing Date, with step downs to
25% at 2.50:1.00 First Lien Leverage Ratio and 0% at 1.75:1.00 First Lien
Leverage Ratio, of the Borrower (with a dollar-for-dollar credit for optional
prepayments of the Term Loan Facilities subsequent to the first day of the
relevant year other than to the extent financed with long-term debt), in each
case of clauses (i) - (iii), subject to the limitations set forth in the
paragraph immediately following, such amounts shall be applied, without premium
or penalty, to the remaining amortization payments under the Term B Loan
Facility in direct order of maturity.    Any Lender under the Term B Loan
Facility may elect not to accept its pro rata portion of any mandatory
prepayment other than a prepayment made with the proceeds of a Refinancing Debt
(each a “Declining Lender”). Any prepayment amount declined by a Declining
Lender may be retained by the Borrower (such amount, a “Declined Amount”).   
Mandatory prepayments in clauses (i) and (iii) above shall be limited to the
extent the upstreaming or transfer of such amounts from a foreign subsidiary to
the Borrower or any other applicable subsidiary would result in material adverse
tax consequences until such time as the Borrower or its applicable subsidiary
may upstream or transfer such amounts and shall be subject to permissibility
under local law of upstreaming proceeds (including financial assistance and
corporate benefit restrictions and fiduciary and statutory duties of the
relevant directors). The non-application of any mandatory prepayment amounts as
a consequence of the foregoing provisions will not, for the avoidance of doubt,
constitute a default or an event of default, and such amounts shall be available
for working capital purposes of the Borrower and its subsidiaries.    The
Interim Term Loan Facility shall not be subject to any mandatory prepayments.

 

Annex I-10

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Optional Prepayments:    The Term Loan Facilities may be prepaid at any time in
whole or in part without premium or penalty, upon written notice, at the option
of the Borrower, except (x) that any prepayment of LIBOR advances other than at
the end of the applicable interest periods therefor shall be made with customary
reimbursement for any funding losses and redeployment costs (but not loss of
margin) of the Lenders resulting therefrom and (y) with respect to the Term B
Loan Facility, as set forth in “Soft-Call Premium” below. Each optional
prepayment of the Term Loan Facilities shall be applied as directed by the
Borrower (and absent such direction, in direct order of maturity thereof).
Soft-Call Premium:    In the event that all or any portion of the Term B Loan
Facility is (i) repaid, prepaid, refinanced or replaced with term loan
indebtedness with a lower effective yield (to be defined) than the effective
yield of such Term B Loan Facility or (ii) repriced through any waiver, consent
or amendment that has the effect of reducing the effective yield of the Term B
Loan Facility (a “Repricing Transaction”), in each case, prior to the six-month
anniversary of the Closing Date and other than in connection with a change of
control or any transformative acquisition (to be defined), such repayment,
prepayment, refinancing, replacement or repricing will be accompanied by a
premium of 1% of the principal amount so repaid, prepaid, refinanced, replaced
or repriced. If all or any portion of the Term B Loan Facility held by any
Lender is required to be assigned pursuant to a “yank-a-bank” provision in the
Credit Documentation as a result of, or in connection with a Repricing
Transaction prior to the six-month anniversary of the Closing Date, such Lender
not agreeing or otherwise consenting to any waiver, consent or amendment
referred to in clause (ii) above (or otherwise in connection with a Repricing
Transaction), such replacement will be accompanied by a premium equal to 1% of
the principal amount so required to be assigned. Security:    Subject to the
Funds Certain Provisions, the Borrower and each of the Guarantors shall grant
the Administrative Agent (for its benefit and for the benefit of the Lenders) a
first-priority (subject to permitted liens and other customary exceptions)
security interest in (i) 100% of the capital stock held by the Borrower and the
Guarantors (but limited in the case of the voting capital stock of any
first-tier CFC or Disregarded Domestic Person, to 65% of such capital stock),
(ii) substantially all material owned real property located in the United States
and equipment of the Borrower and the Guarantors and (iii) substantially all
other personal property of the Borrower and the Guarantors, including, without
limitation, contracts, patents, copyrights, trademarks, other general
intangibles and all proceeds of the foregoing, in each case, excluding the
Excluded Assets (as defined below) (collectively, but excluding the Excluded
Assets (as defined below), the “Collateral”).   

Notwithstanding anything to the contrary, the Collateral shall exclude the
following: (i) any fee-owned real property located outside of the United States
or with a fair market value of less than an amount to be agreed (with all
required mortgages being permitted to be delivered post-closing)

 

Annex I-11

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   and all leasehold interests in real property; (ii) motor vehicles, aircrafts
and other assets subject to certificates of title (except to the extent
perfection can be accomplished through the filing of UCC-1 financing
statements); (iii) letter of credit rights (except to the extent perfection can
be accomplished through the filing of UCC-1 financing statements) and commercial
tort claims with a value of less than an amount to be agreed; (iv) pledges and
security interests prohibited by applicable law, rule or regulation (including
the requirement to obtain consent of any governmental authority) after giving
effect to the applicable anti-assignment provisions of the Uniform Commercial
Code, other than proceeds and receivables thereof, the assignment of which is
expressly deemed effective under the Uniform Commercial Code notwithstanding
such prohibition; (v) equity interests in any person other than wholly-owned
subsidiaries to the extent not permitted by the terms of such person’s
organizational or joint venture documents after giving effect to the applicable
anti-assignment provisions of the Uniform Commercial Code, other than proceeds
and receivables thereof, the assignment of which is expressly deemed effective
under the Uniform Commercial Code notwithstanding such prohibition; (vi) any
lease, permit, license or other agreement or any property subject to a purchase
money security interest or similar arrangement to the extent that a grant of a
security interest therein would violate or invalidate such lease, permit,
license or agreement or arrangement or create a right of termination in favor
of, or require the consent of, any other party thereto (other than the Borrower
or any of its restricted subsidiaries) after giving effect to the applicable
anti-assignment provisions of the Uniform Commercial Code, other than proceeds
and receivables thereof, the assignment of which is expressly deemed effective
under the Uniform Commercial Code notwithstanding such prohibition; (vii) those
assets as to which the Administrative Agent and the Borrower reasonably agree
that the cost of obtaining such a security interest or perfection thereof are
excessive in relation to the benefit to the Lenders of the security to be
afforded thereby; (viii) voting equity interests in excess of 65% of any first
tier CFC or Disregarded Domestic Person; (ix) any of the equity interests of a
subsidiary of a CFC or Disregarded Domestic Person; (x) any governmental
licenses or state or local franchises, charters and authorizations, to the
extent security interests in such licenses, franchises, charters or
authorizations are prohibited or restricted thereby after giving effect to the
applicable anti-assignment provisions of the Uniform Commercial Code; (xi)
“intent-to-use” trademark or service mark applications; (xii) (a) payroll and
other employee wage and benefit accounts, (b) sales tax accounts, (c) escrow
accounts for the benefit of unaffiliated third parties, and (d) fiduciary or
trust accounts for the benefit of unaffiliated third parties, and, in the case
of clauses (a) through (d), the funds or other property held in or maintained in
any such account in each case, other than to the extent perfected by the filing
of a UCC financing statement or are proceeds of Collateral (collectively, the
“Excluded Accounts”); (xiii) any acquired property (including property acquired
through acquisition or merger of another entity) if at the time of such
acquisition the granting of a security interest therein or the pledge thereof is
prohibited by any contract or other agreement (in each case,

 

Annex I-12

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   not created in contemplation thereof) to the extent and for so long as such
contract or other agreement prohibits such security interest or pledge after
giving effect to the applicable anti-assignment provisions of the Uniform
Commercial Code, other than proceeds and receivables thereof, the assignment of
which is expressly deemed effective under the Uniform Commercial Code
notwithstanding such prohibition; (xiv) equity interests issued by, or assets
of, unrestricted subsidiaries, immaterial subsidiaries, not for profit
subsidiaries, special purpose entities and captive insurance subsidiaries; (xv)
margin stock, and (xvi) other exceptions to be mutually agreed upon (the
foregoing described in clauses (i) through (xvi) are, collectively, the
“Excluded Assets”). Notwithstanding anything to the contrary, the Borrower and
the Guarantors shall not be required, nor shall the Administrative Agent be
authorized, (i) to perfect the above-described pledges, security interests and
mortgages by any means other than by (A) filings pursuant to the Uniform
Commercial Code in the office of the secretary of state (or similar central
filing office) of the relevant state(s) and filings in the applicable real
estate records with respect to mortgaged properties constituting Collateral or
any fixtures relating to mortgaged properties constituting Collateral, (B)
filings in United States government offices with respect to intellectual
property as expressly required in the Credit Documentation, (C) delivery to the
Administrative Agent for its possession of all Collateral consisting of material
intercompany notes, stock (or equivalent) certificates of material wholly-owned
restricted subsidiaries and material instruments issued to the Borrower or a
Guarantor (excluding Excluded Assets) or (D) mortgages in respect of fee-owned
real property located in the United States (excluding Excluded Assets) with a
fair market value in excess of an amount to be mutually agreed between the
Borrower and the Administrative Agent, in each case as expressly required in the
Credit Documentation, (ii) other than as set forth in clause (C) of this
paragraph, to perfect security interests in any Collateral (including deposit
accounts and other bank or securities accounts, etc.) through control agreements
or perfection by “control” or (iii) to take any action outside of the United
States with respect to any assets titled or located outside the United States.
All the above-described pledges, security interests and mortgages shall be
created on terms, and pursuant to documentation, subject to the Documentation
Standard and the Funds Certain Provisions and reasonably satisfactory to the
Administrative Agent and the Borrower. Assets will be excluded from the
Collateral in circumstances to be agreed and in circumstances where the
Administrative Agent reasonably determines in consultation with the Borrower
that the cost of obtaining a security interest in such assets is excessive in
relation to the value afforded thereby, and in any event such exclusions shall
include vehicles, trust, payroll and escrow accounts, certain leasehold
interests in real property (except as noted above), assets subject to capital
leases and purchase money arrangements, cash which secures permitted letters of
credit, assets held in jurisdictions outside the U.S. (solely to the extent
action would be required in such other jurisdictions to obtain such security
interests) and assets sold in accordance with the Credit Documentation.

 

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Conditions Precedent to Initial Borrowing on the Closing Date:    The
availability of the Term Loan Facilities on the Closing Date will be limited to
those applicable conditions specified in paragraph 5 of the Commitment Letter.
Representations and Warranties:    Subject to the Documentation Standard, with
customary exceptions, thresholds and baskets to be reasonably and mutually
agreed, representations and warranties applicable to the Borrower and its
restricted subsidiaries (with materiality qualifiers to be mutually agreed),
limited to the following: (i) legal existence, qualification and power; (ii) due
authorization of the Credit Documentation and, with respect to the execution,
delivery and performance of the Credit Documentation, no contravention of law,
material contracts or organizational documents; (iii) with respect to the
execution, delivery and performance of the Credit Documentation, governmental
approvals and consents; (iv) enforceability of the Credit Documentation; (v)
accuracy and completeness of specified financial statements and other
information and no event or circumstance, either individually or in the
aggregate, that has had or would reasonably be expected to have a Material
Adverse Effect (to be defined in the Credit Documentation) (after the Closing
Date); (vi) no material litigation; (vii) ownership of property; (viii)
insurance matters; (ix) environmental matters; (x) tax matters; (xi) ERISA;
(xii) identification of loan parties and subsidiaries of loan parties, and
equity interests owned by loan parties; (xiii) use of proceeds; (xiv) status
under Investment Company Act; (xv) material compliance with laws; (xvi)
intellectual property; (xvii) consolidated solvency as of the Closing Date (with
solvency being determined in a manner consistent with Annex III); (xviii)
collateral documents (subject to permitted liens and other exceptions to
perfection to be mutually agreed); (xix) labor matters; (xx) FCPA and related
matters; and (xxi) foreign assets control regulations and related matters.
Covenants:    Subject to the Documentation Standard, with customary materiality
qualifiers, limitations, exceptions, thresholds and baskets to be reasonably and
mutually agreed, covenants shall be limited to the following:

   (a)    Affirmative Covenants: To be applicable to the Borrower and its
restricted subsidiaries: (i) delivery of audited annual consolidated financial
statements within 90 days after the end of any fiscal year and quarterly
unaudited consolidated financial statements within 45 days after the end of the
first three fiscal quarters of any fiscal year; (ii) compliance certificates and
annual budgets; (iii) notification of default and material litigation; (iv)
payment of material taxes; (v) preservation of existence; (vi) maintenance of
properties (subject to casualty, condemnation and normal wear and tear); (vii)
maintenance of insurance; (viii) material compliance with laws; ERISA; (ix)
maintenance of books and records; (x) inspection rights of the Administrative

 

Annex I-14

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      Agent (subject to frequency and cost reimbursement limitations and other
than information subject to confidentiality obligations or attorney-client
privilege); (xi) use of proceeds; (xii) joinder of subsidiaries as guarantors;
(xiii) pledge of capital stock and other property; and (xiv) further assurances
with respect to Collateral and guarantees; (xv) commercially reasonable efforts
to maintain facility and corporate ratings from Moody’s and S&P (but not any
specific ratings), (xvi) annual Lender conference calls if requested by the
Administrative Agent, (xvii) FCPA, foreign asset control regulations and related
matters and (xviii) a covenant to use commercially reasonable efforts to prepay
the Interim Term Loan Facility as soon as practicable on or after January 1,
2017 and prior to the final maturity date thereof.    (b)    Negative
Covenants: To be applicable to the Borrower and its restricted subsidiaries:
restrictions on (i) liens (to include, among other exceptions, a general lien
basket of at least the greater of (i) a fixed dollar amount to be mutually
agreed and (ii) an equivalent percentage of consolidated LTM EBITDA); (ii)
investments (to include, among other exceptions, the (a) ability to make
investments subject to no event of default and pro forma compliance with a
2.50:1.00 Total Leverage Ratio, (b) and Permitted Acquisitions (as defined
below) and (c) investments using the Available Amount Basket, subject to (other
than in the case of the Starter Basket) a pro forma Total Leverage Ratio of not
greater than 3.50:1.00); (iii) indebtedness (to include, among other exceptions,
the ability to incur indebtedness subject to pro forma compliance with a
3.50:1.00 Total Leverage Ratio); (iv) mergers and dissolutions; (v) dispositions
(to include, among other exceptions, dispositions of any other assets on an
unlimited basis for fair market value so long as at least 75% of the
consideration for such dispositions in excess of a threshold amount consists of
cash or cash equivalents and the proceeds thereof are applied in accordance with
the mandatory prepayment provisions (including the reinvestment provisions));
(vi) restricted payments (to include, among other exceptions, the ability to
make restricted payments (a) subject to no event of default and pro forma
compliance with a 2.25:1.00 Total Leverage Ratio and (b) using the Available
Amount Basket (as defined below), subject to (other than in the case of the
Starter Basket) a pro forma Total Leverage Ratio of not greater than 3.50:1.00);
(vii) material change in nature of business; (viii) change in fiscal year
without Administrative Agent’s consent; (ix) transactions with affiliates above
an agreed-upon threshold; (x) voluntarily prepaying, redeeming or repurchasing
certain junior or subordinated debt (to include, among other exceptions, the
ability to prepay, redeem or repurchase such junior or subordinated debt (a)
subject to no event of default and pro forma compliance with a 2.25:1.00 Total

 

Annex I-15

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      Leverage Ratio and (b) using the Available Amount Basket (as defined
below), subject to (other than in the case of the Starter Basket) a pro forma
Total Leverage Ratio of not greater than 3.50:1.00); (xi) granting negative
pledges that limit or restrict the Administrative Agent from taking or
perfecting its lien in the intended Collateral; (xii) amending (x)
organizational documents or (y) certain junior debt instruments, in each case
solely to the extent that such amendments are materially adverse to the Lenders
and (xiii) limitation on restrictions on subsidiary distributions. The foregoing
limitations shall be subject to exceptions and baskets to be mutually and
reasonably agreed as are consistent with the Documentation Standard.      
Monetary baskets in the negative covenants will include basket builders based on
a percentage of Consolidated EBITDA of the Borrower and its restricted
subsidiaries equivalent to the initial monetary amount of each such basket. In
addition, certain negative covenants shall include an “Available Amount Basket”,
which shall mean a cumulative amount equal to (a) $25 million (the “Starter
Basket”) plus (b) the retained portion of excess cash flow plus (c) the cash
proceeds of new equity issuances of the Borrower (other than disqualified
stock), plus (d) returns, profits, distributions and similar amounts received in
cash or cash equivalents by the Borrower and its restricted subsidiaries on
investments made using the Available Amount Basket (not to exceed the amount of
such investments) or otherwise received from an unrestricted subsidiary
(including the net proceeds of any sale, or issuance of stock, of an
unrestricted subsidiary) designated using the Available Amount Basket, plus (e)
the investments of the Borrower and its restricted subsidiaries in any
unrestricted subsidiary that has been re-designated as a restricted subsidiary
or that has been merged or consolidated with or into the Borrower or any of its
restricted subsidiaries (up to the lesser of (i) the fair market value (as
determined in good faith by the Borrower) of the investments of the Borrower and
its restricted subsidiaries in such unrestricted subsidiary at the time of such
re-designation or merger or consolidation and (ii) the fair market value of the
original investments by the Borrower and its restricted subsidiaries in such
unrestricted subsidiary). The Available Amount Basket may be used for
investments, restricted payments and the prepayment, repurchase or redemption of
junior or subordinated debt; provided that use of the Available Amount Basket
(other than the Available Amount Basket attributable to clause (c) above (such
amounts, the “Available Equity Basket”)) shall be subject to the absence of any
continuing event of default.       The Borrower or any restricted subsidiary
will be permitted to make acquisitions of the equity interests in a person that
becomes a restricted subsidiary, or all or substantially all of the

 

Annex I-16

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      assets (or all or substantially all the assets constituting a business
unit, division, product line or line of business) of any person (each, a
“Permitted Acquisition”) so long as (a) at the time of execution of the
applicable acquisition agreement, no event of default has occurred and is
continuing, (b) the acquired company or assets are in the same or a generally
related or ancillary line of business as the Borrower and its subsidiaries and
(c) subject to the limitations set forth in “Guarantors” and “Security” above,
the acquired company and its subsidiaries (other than any subsidiaries of the
acquired company designated as an unrestricted subsidiary as provided in
“Unrestricted Subsidiaries” below) will become Guarantors and pledge their
Collateral to the Administrative Agent. Acquisitions of entities that do not
become Guarantors and made with the proceeds of any consideration provided by
the Borrower or a Guarantor will be limited to an amount to be agreed.      
Notwithstanding the foregoing, certain of the baskets and exceptions in the
negative covenants shall be more restrictive in a manner to be agreed during the
period from the Closing Date to the date of repayment in full of the Interim
Term Loan Facility such that significant activities outside the ordinary course
of business that could be materially adverse to ensuring the timely repayment in
full of the Interim Term Loan Facility are limited. These more restrictive
provisions may be waived or amended solely by Lenders holding a majority of the
Interim Term Loan Facility.       Notwithstanding the foregoing covenants, the
Credit Documentation shall permit the Outbound F Reorganization.    (c)   
Financial Covenants:       (i) Term B Loan Facility: None.       (ii) Interim
Term Loan Facility: At any time that loans under the Interim Loan Facility are
outstanding, maintenance by the Borrower (collectively with its restricted
subsidiaries) of a Minimum Liquidity of $150 million at any time (the “Minimum
Liquidity Covenant”). “Minimum Liquidity” means, collectively, all unrestricted
cash and cash equivalents of the Borrower and its restricted subsidiaries (it
being understood that any cash collateralization in favor of the Administrative
Agent (in its capacity as such) shall not deem any such cash “unrestricted” for
such purposes). Unrestricted Subsidiaries:    The Credit Documentation will
contain provisions pursuant to which, so long as no event of default is
continuing, the Borrower will be permitted to designate any existing or
subsequently acquired or organized subsidiary as an “unrestricted subsidiary”
and subsequently re-designate any

 

Annex I-17

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   such unrestricted subsidiary as a restricted subsidiary; provided, that (x)
such designation of a restricted subsidiary as an unrestricted subsidiary shall
be deemed to constitute an investment (or reduction in an outstanding investment
in the case of a designation of an unrestricted subsidiary as a restricted
subsidiary in an amount equal to the fair market value thereof), (y) after
giving pro forma effect to such designation or re-designation, the Borrower
shall be able to incur at least $1 of debt under the Total Leverage Ratio test
described above under clause (iii) under “Negative Covenants” and (z) any
re-designation of an unrestricted subsidiary to a restricted subsidiary shall be
deemed to be an incurrence of indebtedness and liens of such subsidiary existing
at such time. Unrestricted subsidiaries will not be subject to the mandatory
prepayments, representations and warranties, covenants, events of default or
other provisions of the Credit Documentation, and the results of operations and
indebtedness of unrestricted subsidiaries will not be taken into account for
purposes of calculating any financial ratios contained in the Credit
Documentation. Events of Default:    Subject to the Documentation Standard, with
thresholds and grace periods to be mutually agreed, events of default shall be
limited to the following (to be applicable to the Borrower and its restricted
subsidiaries): (i) (a) nonpayment of principal and (b) nonpayment of interest or
fees and nonpayment of other amounts (with a five (5) day grace period for
interest, fees and other amounts); (ii) any representation or warranty proving
to have been inaccurate in any material respect when made or confirmed; (iii)
failure to perform or observe covenants set forth in the Credit Documentation
(subject, in the case of affirmative covenants, to a grace period of 30 days
following written notice from the Administrative Agent (other than in respect of
maintenance of the Borrower’s existence and notices of default)); (iv)
cross-defaults to other indebtedness in an amount to be agreed; (v) bankruptcy
and insolvency defaults; (vi) monetary judgment defaults to the extent not paid
or covered by indemnities or insurance above an amount to be agreed; (vii)
actual or asserted impairment of security with respect to the Security
Documents, the Guarantees or a material portion of the Collateral; (viii) Change
of Control with respect to Borrower (to be defined in a customary and mutually
agreeable reasonable manner); and (ix) ERISA and (x) failure to consummate the
Merger within 3 business days after the Closing Date; provided that,
notwithstanding anything to the contrary in the Credit Documentation, a breach
of the Minimum Liquidity Covenant will not constitute an event of default for
purposes of the Term B Loan Facility or any other facility other than the
Interim Term Loan Facility, and the Lenders under the Term B Loan Facility (or
any other facility other than the Interim Term Loan Facility) will not be
permitted to exercise any remedies with respect to an uncured breach of the
Minimum Liquidity Covenant until the date, if any, on which the commitments
under the Interim Term Loan Facility have been terminated and the loans under
the Interim Term Loan Facility have been accelerated as a result of such breach.

 

Annex I-18

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Assignments and Participations:    Each Lender will be permitted to make
assignments in minimum amounts to be agreed to other entities approved by (x)
the Administrative Agent and (y) so long as no payment or bankruptcy default has
occurred and is continuing, the Borrower, each such approval not to be
unreasonably withheld or delayed; provided, however, that (i) no approval of the
Borrower shall be required in connection with assignments to other Lenders or
any of their affiliates or approved funds, (ii) the Borrower shall be deemed to
have given consent to an assignment if they shall have failed to respond to a
written request within 10 business days of Borrower’s receipt of such written
request and (iii) no approval of the Administrative Agent shall be required in
connection with assignments to other Lenders or any of their affiliates or
approved funds. Each Lender will also have the right, without consent of the
Borrower or the Administrative Agent, to assign as security all or part of its
rights under the Credit Documentation to any Federal Reserve Bank.
Notwithstanding the foregoing, the consent of the Borrower shall be required
with respect to any assignment if the Initial Lenders (and their respective
affiliates) would not hold, in the aggregate after giving effect to such
assignment, more than 50% of the Interim Term Loan Facility. Lenders will be
permitted to sell participations with voting rights limited to customary
significant matters. An assignment fee in the amount of $3,500 will be charged
with respect to each assignment unless waived by the Administrative Agent in its
sole discretion. Notwithstanding the foregoing, no loans or commitments shall be
assigned or participated to Disqualified Lenders to the extent the list of
Disqualified Lenders has been made available to all Lenders.    Assignments of
loans under the Term Loan Facilities to the Borrower or any of their
subsidiaries shall be permitted subject to satisfaction of conditions to be set
forth in the Credit Documentation, including that (i) no event of default shall
exist or result therefrom, (ii) the Borrower or such subsidiary shall make an
offer to all Lenders in accordance with “Dutch auction” procedures to be agreed,
(iii) the Borrower or any such subsidiaries shall either (x) make a
representation that it is not in possession of material non-public information
with respect to the Borrower, its subsidiaries or their respective securities or
(y) disclose to the assigning Lender that it cannot make such representation and
(iv) upon the effectiveness of any such assignment, such loans shall be retired.
Waivers and Amendments:    Amendments and waivers of the provisions of the
Credit Documentation will require the approval of Lenders holding more than 50%
of the aggregate Term Loan Facilities (the “Required Lenders”), except that (a)
the consent of each Lender directly and adversely affected thereby will also be
required with respect to (i) increases in commitment amount of such Lender, (ii)
reductions of principal, interest, or fees payable to such Lender (other than
waivers of default interest, a default or event of default or mandatory
prepayment); provided that any change in the definitions of any ratio used in
the calculation of any rate of interest or fees (or

 

Annex I-19

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   the component definitions) shall not constitute a reduction in any rate of
interest or fees, (iii) extensions of scheduled maturities or times for payment
of amounts payable to such Lender (it being understood and agreed that the
amendment or waiver of any mandatory prepayment, waiver of default interest,
default or event of default shall only require the consent of the Required
Lenders) and (iv) changes in certain pro rata provisions and the waterfall from
enforcement, (b) the consent of each Term Loan Lender shall be required with
respect to (i) releases of all or substantially all of the Collateral or the
release of all or substantially all of the value of any guaranties (other than
in connection with permitted asset sales, dispositions, mergers, liquidations or
dissolutions or as otherwise permitted under the Credit Documentation) and (ii)
the percentage contained in the definition of Required Lenders or other voting
provisions and (c) the consent of only the lenders in respect of the Interim
Term Loan Facility holding a majority of loans under the Interim Term Loan
Facility shall be required to amend or waive the terms of the Minimum Liquidity
Covenant, any event of default with respect to the Borrower’s failure to comply
with the Minimum Liquidity Covenant and any definition related to the Minimum
Liquidity Covenant.    In connection with any proposed amendment, modification,
waiver or termination (a “Proposed Change”) requiring the consent of all Lenders
or all directly and adversely affected Lenders, if the consent to such Proposed
Change of other Lenders whose consent is required is not obtained (but the
consent of the Required Lenders or Lenders holding more than 50% of the directly
and adversely affected facility, as applicable, is obtained) (any such Lender
whose consent is not obtained being referred to as a “Non-Consenting Lender”),
then the Borrower may, at its option and at its sole expense and effort, upon
notice to such Non-Consenting Lender and the Administrative Agent, require such
Non-Consenting Lender to assign and delegate, without recourse (in accordance
with and subject to customary restrictions on assignment), all its interests,
rights and obligations under the Credit Documentation to an assignee that shall
assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment); provided that, such Non-Consenting Lender shall have
received payment of an amount equal to the outstanding principal of its loans,
accrued interest thereon, accrued fees and all other amounts then due and owing
to it under the Credit Documentation (at the option of the Borrower, with
respect to the class or classes of loans or commitments subject to such Proposed
Change) from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts).
The Credit Documentation shall contain other customary “yank-a-bank” provisions.
   Notwithstanding anything to the contrary set forth herein, the Credit
Documentation shall provide that the Borrower may at any time and from time to
time request that all or a portion of any loans under the Term B Loan Facility
be converted to extend the scheduled maturity date of any payment of principal
with respect to all or a portion of any

 

Annex I-20

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   principal amount of such loans (any such loans which have been so converted,
“Extended Loans”) and upon such request of the Borrower any individual Term Loan
Lender shall have the right to agree to extend the maturity date of its
outstanding loans without the consent of any other Term Loan Lender or Required
Lenders; provided that all such requests shall be made pro rata to all Lenders
within the Term B Loan Facility. The terms of Extended Loans shall be identical
to the loans of the existing class from such Extended Loans are converted except
for interest rates, fees, amortization (so long as the weighted average life to
maturity of the Extended Loans exceeds the then remaining weighted average life
to maturity of the Term B Loan Facility), final maturity date or final
termination date, provisions permitting optional and mandatory prepayments to be
directed first to the non-extended loans prior to being applied to Extended
Loans and certain other customary provisions to be agreed.    In addition, loans
under any of the Term Loan Facilities may be purchased by and assigned to the
Borrower or any of its subsidiaries on a non-pro rata basis through (a) open
market purchases subject to a cap of 25% of the original principal amount of the
loans under any of the Term Loan Facilities or (b) Dutch auctions open to all
applicable Lenders on a pro rata basis in accordance with customary procedures,
so long as (1) no event of default is has occurred and is continuing, (2) any
such loans are permanently cancelled immediately upon acquisition thereof and
(3) the Borrower or any such subsidiaries shall either (x) make a representation
that it is not in possession of material non-public information with respect to
the Borrower, its subsidiaries or their respective securities or (y) disclose to
the assigning Lender that it cannot make such representation. Indemnification:
   The Administrative Agent, the Lead Arrangers and the Lenders and their
respective affiliates and controlling persons and their respective officers,
directors, employees, partners, agents, advisors and other representatives
(each, an “indemnified person”) will be indemnified for and held harmless
against, any losses, claims, damages and liabilities (it being understood that
any such losses, claims, damages or liabilities that consist of legal fees
and/or expenses shall be limited to the reasonable and documented out-of-pocket
fees, disbursements and other charges of one firm of counsel for all such
indemnified persons, taken as a whole and, if necessary, by a single firm of
local counsel in each appropriate jurisdiction (which may include a single firm
of special counsel acting in multiple jurisdictions) for all such indemnified
persons, taken as a whole (and, in the case of a conflict of interest where the
indemnified person affected by such conflict notifies Borrower of the existence
of such conflict and thereafter retains its own counsel, by another firm of
counsel for all such affected indemnified persons)) incurred in respect of the
Credit Documentation, the Term Loan Facilities or the use or the proposed use of
proceeds thereof, the Transactions or any other transactions contemplated
hereby, except to the extent they arise from the (a) bad faith, gross negligence
or willful misconduct of, or material breach of the Credit

 

Annex I-21

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   Documentation by, such indemnified person (or any of its affiliates or any of
its or their respective officers, directors, employees, agents, advisors,
representatives and controlling persons’), or (b) material breach of such
indemnified persons’ (or any of its controlled affiliates’ or any of its
officers’, directors’, employees’, agents’, advisors’, representatives’ and
controlling persons’) obligations under the Credit Documentation, in each case
as determined by a final, non-appealable judgment of a court of competent
jurisdiction or (c) any dispute solely among the indemnified persons (or any of
their respective controlled affiliates or any of their respective officers,
directors, employees, agents, advisors, representatives and controlling persons)
(other than any claims against an indemnified person in its capacity as the
Administrative Agent or Lead Arranger or similar role under any Term Loan
Facility) and not arising out of any act or omission of the Borrower or any of
its subsidiaries. Notwithstanding the foregoing, each indemnified person shall
be obligated to promptly refund and return any and all amounts paid by the
Borrower under this paragraph to such indemnified person for any losses, claims,
damages, liabilities or expenses to the extent such indemnified person is not
entitled to payment of such amounts in accordance with the terms hereof.
Governing Law:    New York. Expenses:    Following written demand (including
documentation reasonably supporting such request), the Borrower will pay all
reasonable and documented out-of-pocket costs and expenses associated with the
preparation, due diligence, administration, syndication and closing of all
Credit Documentation (in the case of legal fees and expenses, limited to the
reasonable and documented fees and out-of-pocket expenses of Cahill Gordon &
Reindel LLP and of any local counsel to the Lenders retained by the Lead
Arrangers or the Administrative Agent, limited to one counsel in each relevant
jurisdiction, which, in each case, shall exclude allocated costs of in-house
counsel), regardless of whether or not the Closing Date occurs; provided that if
the Closing Date does not occur and no termination fee is paid to you pursuant
to Section 9.2(b) of the Acquisition Agreement, the aggregate reimbursement by
the Borrower of such costs and expenses shall not exceed $250,000. The Borrower
will also pay the reasonable and documented out-of-pocket expenses of the
Administrative Agent and one other counsel (in total) to all of the Lenders (in
the absence of conflict) in connection with the enforcement of any of the Credit
Documentation. Counsel to the Commitment Parties:    Cahill Gordon & Reindel LLP
Miscellaneous:    Each of the parties shall (i) waive its right to a trial by
jury and (ii) submit to New York jurisdiction. The Credit Documentation shall
contain (x) customary provisions for replacing the commitments of a (i)
“defaulting lender” and (ii) a Lender seeking indemnity for increased costs or
grossed-up tax payments and (y) customary EU “Bail-In” provisions.

 

Annex I-22

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ANNEX II

CONDITIONS PRECEDENT TO CLOSING

Capitalized terms not otherwise defined herein have the same meanings as
specified therefor in the Commitment Letter to which this Annex II is attached.

The initial extensions of credit under the Term Loan Facilities will, subject in
all respects to the Funds Certain Provisions, be subject to satisfaction of the
following conditions precedent:

(i) The Offer shall have been, or shall substantially concurrently be,
consummated in accordance with the terms of the Agreement and Plan of Merger,
dated June 15, 2016 among Merger Sub, the Borrower and the Target (together with
all Schedules and Exhibits thereto, the “Acquisition Agreement”) without giving
effect to any amendment, change or supplement or waiver of any provision thereof
(including any change in the purchase price) in any manner that is materially
adverse to the interests of the Initial Lenders or the Lead Arrangers (in their
capacities as such) without the prior written consent (not to be unreasonably
withheld, delayed or conditioned) of the Commitment Parties holding a majority
of the aggregate amount of outstanding commitments in respect of the Term Loan
Facilities (the “Majority Lead Arrangers”); provided that (i) any reduction in
the purchase price for the Acquisition set forth in the Acquisition Agreement
shall not be deemed to be material and adverse to the interests of the Initial
Lenders (in their capacities as such) so long as such reduction is applied to
reduce the Term B Loan Facility (on a dollar-for-dollar basis) and (ii) any
increase in the purchase price set forth in the Acquisition Agreement shall be
deemed to be not material and adverse to the interests of the Initial Lenders
(in their capacities as such) so long as such purchase price increase is funded
with proceeds of common equity of the Borrower.

(ii) No Company Material Adverse Effect (as defined in the Acquisition
Agreement) shall have occurred and be continuing.

(iii) The Administrative Agent shall have received the Solvency Certificate from
the Borrower’s chief financial officer or other person with similar
responsibilities in substantially the form attached hereto on Annex III.

(iv) The Administrative Agent shall have received (A) customary opinions of
counsel to the Borrower and the Guarantors, (B) customary corporate (or other
organizational) resolutions from the Borrower and the Guarantors, customary
secretary’s certificates from the Borrower and the Guarantors appending such
resolutions, charter documents and an incumbency certificate and (C) a customary
borrowing notice (provided that such notice shall not include any representation
or statement as to the absence (or existence) of any default or event of
default).

(v) The Administrative Agent shall have received: (A) the audited consolidated
balance sheets and related consolidated statements of operations, cash flows and
shareholders’ equity of each of the Borrower and the Target for the three most
recently completed fiscal years of the Borrower and the Target, respectively,
ended at least 90 days before the Closing Date; (B) the unaudited consolidated
balance sheets and related statements of operations and cash flows of each

 

 

 

Annex II-1

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of the Borrower and the Target for each subsequent fiscal quarter of the
Borrower and the Target, respectively, ended at least 45 days before the Closing
Date (the “Quarterly Financial Statements”); and (C) a pro forma balance sheet
and related statement of operations of the Borrower and its subsidiaries
(including the Acquired Business) as of and for the twelve-month period ending
with the latest quarterly period of the Borrower covered by the Quarterly
Financial Statements, in each case after giving effect to the Transaction (the
“Pro Forma Financial Statements”), which need not comply with the requirements
of Regulation S-X under the Securities Act, as amended, or include adjustments
for purchase accounting or any reconciliation to generally accepted accounting
principles in the United States.

(vi) The Lead Arrangers shall have received a customary Information Memorandum
(other than portions thereof customarily provided by financing arrangers and
limited, in the case of financial information, to the financial statements
described clauses (A) and (B) of paragraph (v) above) (the “Required
Information”) for the Term Loan Facilities not later than 15 consecutive
business days prior to the Closing Date; provided that such 15 consecutive
business day period shall exclude July 1, 2016, which for purposes of such
calculation shall not constitute a business day (the “Marketing Period”);
provided further that if the Marketing Period has not been completed on or prior
to August 19, 2016, then the Marketing Period shall not commence prior to
September 5, 2016. If the Borrower in good faith reasonably believes it has
delivered the Required Information, it may deliver to the Lead Arrangers a
written notice to that effect, in which case the Borrower shall be deemed to
have complied with such obligation to furnish the Required Information on the
date such notice is received by the Lead Arrangers, and the 15 consecutive
business day period referred to above will be deemed to have commenced on the
date such notice is received by the Lead Arrangers, in each case, unless the
Lead Arrangers in good faith reasonably believe that the Borrower has not
completed delivery of such Required Information requested by the Lead Arrangers
in accordance with the preceding sentence for use in the Information Memorandum
and, within two business days after the receipt of such notice from the
Borrower, the Lead Arrangers deliver a written notice to the Borrower to that
effect (stating with reasonable specificity which such Required Information has
not been delivered); provided, that notwithstanding the foregoing, the delivery
of the Required Information shall be satisfied at any time at which (and so long
as) the Lead Arrangers shall have actually received the Required Information,
regardless of whether or when any such notice is delivered by the Borrower.

(vii) All fees due to the Administrative Agent, the Lead Arrangers and the
Lenders under the Fee Letter and the Commitment Letter to be paid on or prior to
the Closing Date, and all reasonable and documented out-of-pocket expenses to be
paid or reimbursed under the Commitment Letter to the Administrative Agent and
the Lead Arrangers on or prior to the Closing Date that have been invoiced at
least three business days prior to the Closing Date, shall have been paid, in
each case, from the proceeds of the initial funding under the Term Loan
Facilities (which amounts may be offset against the proceeds of the Term Loan
Facilities).

(viii) The Refinancing shall have been, or shall substantially concurrently with
the initial funding of the Term Loan Facilities be, consummated.

(ix) The Borrower and each of the Guarantors shall have provided the
documentation and other information to the Administrative Agent that are
required by regulatory authorities under applicable “know-your-customer” rules
and regulations, including the Patriot Act, at least 3 business days prior to
the Closing Date to the extent such information has been reasonably requested in
writing by the Administrative Agent at least 10 business days prior to the
Closing Date.

 

Annex II-2

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(x) Subject in all respects to the Funds Certain Provisions, all documents and
instruments required to create and perfect the Administrative Agent’s security
interests in the Collateral shall have been executed and delivered by the
Borrower and the Guarantors (or, where applicable, the Borrower and the
Guarantors shall have authorized the filing of financing statements under the
Uniform Commercial Code) and, if applicable, be in proper form for filing.

 

Annex II-3

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ANNEX III

SOLVENCY CERTIFICATE1

[            ], 201[    ]

This SOLVENCY CERTIFICATE (this “Certificate”) is delivered in connection with
that certain Credit Agreement dated as of [            ], 201[    ] (as amended,
supplemented, amended and restated, replaced, or otherwise modified from time to
time, the “Credit Agreement”) among Cavium, Inc., a Delaware corporation (the
“Borrower”), [                    ], as administrative agent and collateral
agent, the financial institutions from time to time party thereto as lenders and
the other parties thereto. Capitalized terms used herein without definition have
the same meanings as in the Credit Agreement.

As of the date hereof, in my capacity as a Responsible Officer of Company (as
defined below), and not in my individual or personal capacity, I believe that:

1. Company (as used herein “Company” means the Borrower and its subsidiaries,
taken as a whole) is not now, nor will the incurrence of the obligations under
the Credit Agreement and the consummation of the Acquisition on the Closing Date
(and after giving effect to the application of the proceeds of the Loans), on a
pro forma basis, render Company “insolvent” as defined in this paragraph; in
this context, “insolvent” means that (i) the fair value of assets (on a going
concern basis) of the Company is less than the amount that will be required to
pay the total liability on existing debts as they become absolute and matured,
(ii) the present fair salable value of assets (on a going concern basis) of the
Company is less than the amount that will be required to pay the probable
liability on existing debts as they become absolute and matured in the ordinary
course of business, or (iii) the Company ceases to pay its current obligations
in the ordinary course of business as they generally become due, or (iv) the
Company’s aggregate property is not, at a fair valuation, sufficient, or if
disposed of at a fairly conducted sale under legal process, would not be,
sufficient to enable payment of all obligations, due and accruing due. The term
“debts” as used in this Certificate includes any legal liability, whether
matured or unmatured, liquidated or unliquidated, absolute, fixed or contingent
and “values of assets” shall mean the amount of which the assets (both tangible
and intangible) in their entirety would change hands between a willing buyer and
a willing seller, with a commercially reasonable period of time, each having
reasonable knowledge of the relevant facts, with neither being under compulsion
to act.

2. The incurrence of the obligations under the Credit Agreement and the
consummation of the other Transactions on the Closing Date (and after giving
effect to the application of the proceeds of the Loans), on a pro forma basis,
will not leave Company with property remaining in its hands constituting
“unreasonably small capital.” I understand that “unreasonably small capital”
depends upon the nature of the particular business or businesses conducted or to
be conducted, and I have reached my conclusion based on my current assumptions
regarding the needs and anticipated needs for capital of the businesses
conducted or anticipated to be conducted by Company in light of projected
financial statements and available credit capacity, which current assumption I
do not believe to be unreasonable in light of the circumstances applicable
thereto.

 

1  Defined terms to be aligned with those in the definitive Credit Agreement,
but consistent with this form of solvency certificate.

 

Annex III-1

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IN WITNESS WHEREOF, the undersigned has executed this Solvency Certificate in
such undersigned’s capacity as an officer of the Borrower, on behalf of the
Borrower, and not individually, as of the date first above written.

 

CAVIUM, INC. By:  

 

  Name:   Title:

Signature Page to Solvency Certificate