Document:

exv10w14

 

Exhibit 10.14

SECOND LOAN MODIFICATION AGREEMENT

     This Second Loan Modification Agreement (this “Loan Modification Agreement”) is
entered into on January 25, 2007 by and between Silicon Valley Bank, a California
corporation with its principal place of business at 3003 Tasman Drive, Santa Clara, California
95054 (“Bank”) and Cavium Networks, California corporation with offices at 805 E.
Middlefield Road, Mountain View, California 94043 (“Borrower”).

1. Description Of Existing Indebtedness And Obligations. Among other indebtedness and
obligations which may be owing by Borrower to Bank, Borrower is indebted to Bank pursuant to a loan
arrangement dated as of October 6, 2005 evidenced by, among other documents, a certain Loan and
Security Agreement dated as of October 6, 2005 between Borrower and Bank, as amended by a certain
Loan Modification Agreement dated January 3, 2007 (as amended, the “Loan Agreement”). Capitalized
terms used but not otherwise defined herein shall have the same meaning as in the Loan Agreement.

2. Description Of Collateral. Repayment of the Obligations is secured by the Collateral
as described in the Loan Agreement (together with any other collateral security granted to Bank,
the “Security Documents”).

Hereinafter, the Security Documents, together with all other documents executed in connection
therewith evidencing, securing or otherwise relating to the Obligations shall be referred to as the
“Existing Loan Documents”.

3. Description Of Change In Terms.

     Modifications To Loan Agreement.

	 	1.	 	The definition of “Revolving Line Maturity Date” set forth in Section
13.1 of the Loan Agreement is hereby amended by deleting the following text
appearing therein:

““Revolving Line Maturity Date” is the earliest of (a) January 4, 2008 or
(b) the occurrence of an Event of Default.”

and substituting the following text therefor:

““Revolving Line Maturity Date” is the earliest of (a) July 4, 2008 or (b)
the occurrence of an Event of Default.”

4. Fees. Borrower shall pay to Bank a modification fee equal to Five Thousand Dollars
($5,000.00), which fee shall be due on the date hereof and shall be deemed fully earned as of the
date hereof. Borrower shall also reimburse Bank for all legal fees and expenses incurred by Bank
in connection with the Existing Loan Documents and this amendment thereto.

5. Representations And Warranties Certificate. Borrower hereby ratifies, confirms and
reaffirms, all and singular, the terms and disclosures contained in a certain Representations and
Warranties Certificate dated on or about October 6, 2005 delivered to Bank, and acknowledges,
confirms and agrees the disclosures and information Borrower provided to Bank in the Representation
and Warranties Certificate have not changed, as of the date hereof.

6. Ratification Of Negative Pledge Agreement. Borrower hereby ratifies, confirms and
reaffirms, all and singular, the terms and conditions of a certain Negative Pledge Agreement dated
October 6, 2005, and acknowledges, confirms and agrees that said Negative Pledge Agreement shall
remain in full force and effect.

7. Consistent Changes. The Existing Loan Documents are hereby amended wherever necessary
to reflect the changes described above.

8. Ratification Of Loan Documents. Borrower hereby ratifies, confirms, and reaffirms all
terms and conditions of all security or other collateral granted to the Bank, and confirms that the
indebtedness secured thereby includes, without limitation, the Obligations.

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9. No Defenses Of Borrower. Borrower hereby acknowledges and agrees that Borrower has no
offsets, defenses, claims, or counterclaims against Bank with respect to the Obligations, or
otherwise, and that if Borrower now has, or ever did have, any offsets, defenses, claims, or
counterclaims against Bank, whether known or unknown, at law or in equity, all of them are hereby
expressly WAIVED and Borrower hereby RELEASES Bank from any liability thereunder.

10. Continuing Validity. Borrower understands and agrees that in modifying the existing
Obligations, Bank is relying upon Borrower’s representations, warranties, and agreements, as set
forth in the Existing Loan Documents. Except as expressly modified pursuant to this Loan
Modification Agreement, the terms of the Existing Loan Documents remain unchanged and in full force
and effect. Bank’s agreement to modifications to the existing Obligations pursuant to this Loan
Modification Agreement in no way shall obligate Bank to make any future modifications to the
Obligations. Nothing in this Loan Modification Agreement shall constitute a satisfaction of the
Obligations. It is the intention of Bank and Borrower to retain as liable parties all makers of
Existing Loan Documents, unless the party is expressly released by Bank in writing. No maker will
be released by virtue of this Loan Modification Agreement.

11. Jurisdiction/Venue. Borrower accepts for itself and in connection with its
properties, unconditionally, the exclusive jurisdiction of any state or federal court of competent
jurisdiction in the State of California in any action, suit, or proceeding of any kind against it
which arises out of or by reason of this Loan Modification Agreement. NOTWITHSTANDING THE
FOREGOING, THE BANK SHALL HAVE THE RIGHT TO BRING ANY ACTION OR PROCEEDING AGAINST THE BORROWER OR
ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION WHICH THE BANK DEEMS NECESSARY OR APPROPRIATE
IN ORDER TO REALIZE ON THE COLLATERAL OR TO OTHERWISE ENFORCE THE BANK’S RIGHTS AGAINST THE
BORROWER OR ITS PROPERTY.

12. Countersignature. This Loan Modification Agreement shall become effective only when
it shall have been executed by Borrower and Bank.

[remainder of page intentionally left blank]

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     This Loan Modification Agreement is executed under the laws of the State of
California as of the date first written above.

	 	 	 	 	 	 	 	 
	BORROWER:

Cavium Networks 

 	 	BANK:

Silicon Valley Bank

 	 
	By:  	/s/ Arthur Chadwick
 	 	By:  	/s/ Jean Lee
 	 
	 	Name:  	Arthur Chadwick	 	 	Name:  	Jean Lee 	 
	 	Title:  	CFO	 	 	Title:  	Relationship Manager 	 
	 

3.exv10w15

 

Exhibit 10.15

TERM LOAN AND SECURITY AGREEMENT

     This TERM LOAN AND SECURITY AGREEMENT (the “Agreement”) dated October 6, 2005 by and among
SILICON VALLEY BANK, a California-chartered bank, with its principal place of business at 3003
Tasman Drive, Santa Clara, California 95054 (“SVB”), as agent (the “Agent”), and the Lenders listed
on Schedule 1.1 and otherwise party hereto, including without limitation, SVB and GOLD HILL VENTURE
LENDING 03, L.P. (“Gold Hill”) and CAVIUM NETWORKS, a California corporation, whose address is 805
E. Middlefield Road, Mountain View, California 94043 (“Borrower”) provides the terms on which
Lenders shall extend credit to Borrower and Borrower shall repay Lenders. The parties agree as
follows:

1 ACCOUNTING AND OTHER TERMS

     Accounting terms not defined in this Agreement shall be construed following GAAP. Calculations
and determinations must be made following GAAP. The term “financial statements” includes the notes
and schedules attached hereto. The terms “including” and “includes” always mean “including (or
includes) without limitation,” in this or any Loan Document. Capitalized terms in this Agreement
shall have the meanings set forth in Article 13. All other terms contained in this Agreement,
unless otherwise indicated, shall have the meaning provided by the Code, to the extent such terms
are defined therein.

2 LOAN AND TERMS OF PAYMENT

     2.1 Promise to Pay.

     Borrower hereby unconditionally promises to pay Lenders the unpaid principal amount of all
Credit Extensions and interest on the unpaid principal amount of the Credit Extensions as and when
due in accordance with this Agreement.

          2.1.1 Term Loan Facility.

          (a) Availability. Subject to the terms and conditions of this Agreement, Lenders
agree, severally and not jointly, to lend to Borrower from time to time prior to the Commitment
Termination Date, advances (each an “Advance” and collectively the “Advances”) in an aggregate
amount not to exceed the Term Loan, according to each Lender’s pro rata share of the Term Loan
(based upon the respective Commitment Percentage of each Lender). When repaid, the Advances may
not be re-borrowed. Lenders’ obligation to lend hereunder shall terminate on the earlier of (i)
the occurrence and continuance of an Event of Default, or (ii) the Commitment Termination Date.
For purposes of this Section, the minimum amount of each Advance is One Million Dollars
($1,000,000.00).

          (b) Borrowing Procedure. To obtain an Advance, Borrower must notify Agent by facsimile
or telephone by 12:00 p.m. Pacific time five (5) Business Days prior to the date the Advance is to
be made. If such notification is by telephone, Borrower must promptly confirm the notification by
delivering to Agent a completed Payment/Advance Form in the form attached as Exhibit B (
the Payment/Advance Form). On the Funding Date, each Lender shall credit and/or transfer (as
applicable) to Borrower’s deposit account, an amount equal to its Commitment Percentage multiplied
by the amount of the Advance. Each Lender may make Advances under this Agreement based on
instructions from a Responsible Officer or his or her designee or without instructions if the
Advances are necessary to meet Obligations which have become due. Each Lender may rely on any
telephone notice given by a person whom such Lender reasonably believes is a Responsible Officer or
designee. Borrower shall indemnify each Lender for any loss Lender suffers due to such reliance.

     2.2 Termination of Commitment to Lend.

     Each Lender’s obligation to lend the undisbursed portion of the Obligations shall terminate
if, in such Lender’s good faith business judgment, there has been a material adverse change in the
general affairs, management, results of operation, condition (financial or otherwise) or the
prospect of repayment of the Obligations, or there has

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been any material adverse deviation by Borrower from the most recent business plan of Borrower
presented to and accepted by Agent prior to the execution of this Agreement.

     2.3 Interest Rate, Payments.

          (a) Interest Payments. Commencing on the first Payment Date of the month following
the month in which the Funding Date occurs (or commencing on the Funding Date if the Funding Date
is the first calendar day of the month), Borrower shall make monthly payments of interest at the
rate set forth in Section 2.3(c).

          (b) Repayment. Commencing on the Term Loan Amortization date, for each Advance,
Borrower shall make consecutive equal monthly payments of principal and interest, in advance,
calculated by Agent based upon: (1) the amount of the Advance, (2) the effective rate of interest
set forth in Section 2.3(c), and (3) an amortization schedule equal to thirty (30) months
(individually, the “ Scheduled Payment”, and collectively, “Scheduled Payments”), on the first
Business Day of the month following the month in which the Funding Date occurs (or commencing on
the Funding Date if the Funding Date is the first Business Day of the month) with respect to such
Advance and continuing thereafter during the Repayment Period on the first Business Day of each
successive calendar month (each a “Payment Date”). All unpaid principal and accrued interest is
due and payable in full on the last Payment Date with respect to such Advance. Payments received
after 12:00 noon Pacific time are considered received at the opening of business on the next
Business Day. An Advance may only be prepaid in accordance with Sections 2.3(e) and 2.3(f).

          (c) Interest Rate. Borrower shall pay interest on each Payment Date on the unpaid
principal amount of each Advance until the Advance has been paid in full, at the fixed per annum
rate of interest equal to the aggregate of the Prime Rate and three and three-quarters of one
percent (3.75%), determined by Agent as of the Funding Date for each Advance. Interest is computed
on the basis of a three hundred sixty (360) day year for the actual number of days elapsed. Any
amounts outstanding during the continuance of an Event of Default shall bear interest at a per
annum rate equal to the applicable rate as set forth above, plus four percent (4%)(the “Default
Rate”).

          (d) Final Payment. On the Maturity Date with respect to each Advance, Borrower shall
pay, in addition to the unpaid principal and accrued interest and all other amounts due on such
date with respect to such Advance, an amount equal to the Final Payment.

          (e) Mandatory Prepayment Upon an Acceleration. If the Advances are accelerated
following the occurrence of an Event of Default or otherwise, Borrower shall immediately pay to
Lenders an amount equal to the sum of: (i) all outstanding principal plus accrued interest, (ii)
the Final Payment plus (iii) all other sums including the Prepayment Fee, if any, that shall have
become due and payable, including interest at the Default Rate with respect to any past due
amounts.

          (f) Permitted Prepayment of Loans. Borrower shall have the option to prepay all, but
not less than all, of the Advances advanced by Lenders under this Agreement, provided Borrower (i)
provides written notice to Agent of its election to prepay the Advances at least thirty (30) days
prior to such prepayment, and (ii) pays, on the date of such prepayment (A) all outstanding
principal plus accrued interest, (B) the Final Payment plus (C) all other sums including the
Prepayment Fee, if any, that shall have become due and payable, including interest at the Default
Rate with respect to any past due amounts.

          (g) Debit of Accounts. Agent may debit any of Borrower’s deposit or operating
accounts including Account Number 3300301459 for principal and interest payments when due or any
amounts Borrower owes Lenders, when due. Agent shall promptly notify Borrower after it debits
Borrower’s accounts. These debits shall not constitute a set-off.

     2.4 Fees.

     Borrower shall pay to Agent:

          (a) Final Payment. The Final Payment, when due hereunder;

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          (b) Prepayment Fee. The Prepayment Fee, as defined herein, if and when applicable;
and

          (c) Lenders’ Expenses. All Lenders’ Expenses (including reasonable attorneys’ fees
and expenses) incurred through and after the Closing Date, when due.

     2.5 Additional Costs. If any new law or regulation adopted after the Closing Date increases
any Lender’s costs or reduces its income for any Credit Extension made hereunder, Borrower shall
pay the increase in cost or reduction in income or additional expense; provided, however, that
Borrower shall not be liable for any amount attributable to any period before 180 days prior to the
date Agent notifies Borrower of such increased costs. Each Lender agrees that it shall allocate
any increased costs among its customers similarly affected in good faith and in a manner consistent
with such Lender’s customary practice.

3 CONDITIONS OF LOANS

     3.1 Conditions Precedent to Initial Credit Extension.

     The Lenders’ obligation to make the initial Credit Extension is subject to the condition
precedent that Agent shall have received, in form and substance satisfactory to Agent, such
documents and completion of such other matters, as Agent may reasonably deem necessary or
appropriate, including, without limitation, the following:

          (a) this Agreement;

          (b) a certificate of the Secretary of Borrower with respect to articles, by-laws, incumbency
and resolutions authorizing the execution and delivery of this Agreement, the Loan Documents, and
all transactions related thereto, including the Warrant;

          (c) subordination agreements, as necessary;

          (d) landlord’s waiver;

          (e) Representations and Warranties Certificate by Borrower;

          (f) Warrants to Purchase Stock;

          (g) Account Control Agreement/Investment Account Control Agreements (SVB and other financial
institutions);

          (h) VCOC Letter Agreement;

          (i) insurance certificate;

          (j) payment of the fees and Lenders Expenses then due;

          (k) Certificate of Foreign Qualification (if applicable);

          (l) Certificate of Good Standing/Legal Existence; and

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

     3.2 Conditions Precedent to all Credit Extensions.

     The obligations of Lenders to make each Credit Extension, including the initial Credit
Extension, is subject to the following:

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          (a) timely receipt of any Payment/Advance Form; and

          (b) the representations and warranties in Article 5 shall be true in all material respects on
the date of the Payment/Advance Form and on the effective date of each Credit Extension and no
Event of Default shall have occurred and be continuing, or result from the Credit Extension (except
to the extent they relate specifically to an earlier date, in which case such representations and
warranties shall continue to have been true and accurate as of such date specified). Each Credit
Extension is Borrower’s representation and warranty on that date that the representations and
warranties in Article 5 remain true in all material respects.

4 CREATION OF SECURITY INTEREST

     4.1 Grant of Security Interest. Borrower hereby grants Agent, for the ratable benefit of the
Lenders, and to each Lender, to secure the payment and performance in full of all of the
Obligations and the performance of each of Borrower’s duties under the Loan Documents, a continuing
security interest in, and pledges and assigns to Agent, for the ratable benefit of the Lenders, and
to each Lender, the Collateral, wherever located, whether now owned or hereafter acquired or
arising, and all proceeds and products thereof. Subject to Section 5.2, Borrower warrants and
represents that the security interest granted herein shall be a first priority security interest in
the Collateral.

Except as noted on the Representations and Warranties Certificate, Borrower is not a party to, nor
is it bound by, any material license (other than over the counter software that is commercially
available to the public) or other material agreement with respect to which Borrower is the licensee
that is material to Borrower’s business that prohibits or otherwise restricts Borrower from
granting a security interest in Borrower’s interest in such license or agreement or any other
property. Borrower shall provide written notice to Agent within fifteen (15) days of entering or
becoming bound by, any such license or agreement which is reasonably likely to have a material
impact on Borrower’s business or financial condition. Borrower shall take such steps as Agent
reasonably requests to obtain the consent of, authorization by or waiver by, any person whose
consent or waiver is necessary for all such licenses or contract rights to be deemed “Collateral”
and for Lenders to have a security interest in it that might otherwise be restricted or prohibited
by law or by the terms of any such license or agreement, whether now existing or entered into in
the future.

If Borrower shall, at any time, acquire a commercial tort claim, Borrower shall promptly
notify Agent in a writing signed by Borrower of the brief details thereof and grant to Agent and
Lenders in such writing a security interest therein and in the proceeds thereof, all upon the terms
of this Agreement, with such writing to be in form and substance satisfactory to Agent.

     4.2 Termination by Borrower.

     Borrower may terminate this agreement by sending written notice to Agent and paying in full
all Obligations. If this Agreement is terminated, Lenders’ and Agent’s lien and security interest
in the Collateral shall continue until Borrower fully satisfies the Obligations, other than any
inchoate obligations to indemnify Bank. Upon that satisfaction, Bank will terminate its security
interest in the Collateral.

     4.3 Authorization to File Financing Statements.

     Borrower hereby authorizes Agent to file UCC financing statements, without notice to Borrower,
with all appropriate jurisdictions, in order to perfect or protect Agent’s and Lenders’ interest or
rights hereunder, including a notice that any disposition of the Collateral by either Borrower or
any other Person, shall be deemed to violate the rights of the Lenders under the Code.

5 REPRESENTATIONS AND WARRANTIES

     Borrower represents and warrants to Agent and each Lender as follows:

     5.1 Due Organization and Authorization.

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     Borrower and each Subsidiary is duly existing and in good standing in its state of formation
and qualified and licensed to do business in, and in good standing in, any state in which the
conduct of its business or its ownership of property requires that it be qualified, except where
the failure to do so could not reasonably be expected to have a material adverse effect on
Borrower’s business or operations. In connection with this Agreement, Borrower delivered to Agent
and Lenders a representations and warranties certificate signed by Borrower and entitled
“Representations and Warranties Certificate” (the “Representations and Warranties Certificate”).
Borrower represents and warrants to Agent and each Lender that: (a) Borrower’s exact legal name is
that indicated on the Representations and Warranties Certificate and on the signature page hereof;
and (b) Borrower is an organization of the type, and is organized in the jurisdiction, set forth in
the Representations and Warranties Certificate; and (c) the Representations and Warranties
Certificate accurately sets forth Borrower’s organizational identification number or accurately
states that Borrower has none; and (d) the Representations and Warranties Certificate accurately
sets forth Borrower’s place of business, or, if more than one, its chief executive office as well
as Borrower’s mailing address if different, and (e) all other information set forth on the
Representations and Warranties Certificate pertaining to Borrower is accurate and complete in all
material respects. If Borrower does not now have an organizational identification number, but
later obtains one, Borrower shall forthwith notify Agent of such organizational identification
number.

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

     5.2 Collateral.

     Borrower has good title to the Collateral, free of Liens except Permitted Liens. Borrower
has no deposit account, other than the deposit accounts with Lenders and deposit accounts described
in the Representations and Warranties Certificate delivered to Agent and Lenders in connection
herewith. The Collateral is not in the possession of any third party bailee (such as a warehouse).
Except as hereafter disclosed to the Lenders in writing by Borrower, none of the components of the
Collateral shall be maintained at locations other than as provided in the Representations and
Warranties Certificate. In the event that Borrower, after the date hereof, intends to store or
otherwise deliver any portion of the Collateral to a bailee, then Borrower will notify Agent in
writing and, except with respect to warehouse locations of Borrower at which Collateral with an
aggregate value of $500,000 or less is located with respect to all such locations, receive the
written consent of Lenders and such bailee must acknowledge in writing that the bailee is holding
such Collateral for the benefit of Agent and Lenders. All Inventory is in all material respects of
good and marketable quality, free from material defects. Borrower is the sole owner of the
Intellectual Property, except for non-exclusive licenses granted to its customers in the ordinary
course of business. To the best of Borrower’s knowledge, each Patent is valid and enforceable and
no part of the Intellectual Property has been judged invalid or unenforceable, in whole or in part,
and no claim has been made that any part of the Intellectual Property violates the rights of any
third party, except to the extent such invalidity, unenforceability or claim could not reasonably
be expected to have a material adverse effect on Borrower’s business or operations.

     5.3 Litigation.

     Except as shown in the Representations and Warranties Certificate, there are no actions or
proceedings pending or, to the knowledge of Borrower’s Responsible Officers, threatened by or
against Borrower or any Subsidiary in which an adverse decision could reasonably be expected to
have a material adverse effect on Borrower’s business or operations.

     5.4 No Material Deterioration in Financial Statements.

     All consolidated financial statements for Borrower, and any Subsidiary, delivered to Agent,
fairly present in all material respects Borrower’s consolidated financial condition and Borrower’s
consolidated results of operations. There has not been any material deterioration in Borrower’s
consolidated financial condition since the date of the most recent financial statements submitted
to Agent.

     5.5 Solvency.

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

     5.6 Regulatory Compliance.

     Borrower is not an “investment company” or a company “controlled” by an “investment company”
under the Investment Company Act of 1940. Borrower is not engaged as one of its important
activities in extending credit for margin stock (under Regulations X, T and U of the Federal
Reserve Board of Governors). Borrower has complied in all material respects with the Federal Fair
Labor Standards Act. Borrower has not violated any laws, ordinances or rules, the violation of
which could reasonably be expected to have a material adverse effect on Borrower’s business or
operations. None of Borrower’s or any Subsidiary’s properties or assets has been used by Borrower
or any Subsidiary or, to the best of Borrower’s knowledge, by previous Persons, in disposing,
producing, storing, treating, or transporting any hazardous substance other than legally. Borrower
and each Subsidiary has timely filed all required tax returns and paid, or made adequate provision
to pay, all material taxes, except those being contested in good faith with adequate reserves under
GAAP. Borrower and each Subsidiary has obtained all consents, approvals and authorizations of,
made all declarations or filings with, and given all notices to, all government authorities that
are necessary to continue its business as currently conducted, except where the failure to obtain
or make such consents, declarations, notices or filings would not reasonably be expected to have a
material adverse effect on Borrower’s business or operations.

     5.7 Subsidiaries.

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

     5.8 Full Disclosure.

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

6 AFFIRMATIVE COVENANTS

     Borrower shall do all of the following:

     6.1 Government Compliance.

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

     6.2 Financial Statements, Reports, Certificates.

          (a) Borrower shall deliver to Agent: (i) as soon as available, but no later than thirty (30)
days after the last day of each month, a company prepared consolidated balance sheet and income
statement covering Borrower’s consolidated operations during the period certified by a Responsible
Officer and in a form acceptable to Agent; (ii) as soon as available, but no later than one hundred
twenty (120) days after the last day of Borrower’s fiscal year , audited consolidated financial
statements of Borrower prepared under GAAP, consistently applied, together with an unqualified
opinion on the financial statements from an independent certified public accounting firm reasonably

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acceptable to Agent (provided, however, Borrower may deliver its FYE 2004 financial statements
to Agent on or before December 31, 2005); (iii) in the event that Borrower’s stock becomes publicly
held, within five (5) Business Days after filing but no later than fifty (50) days after the
relevant reporting period, Borrower shall provide to Agent copies of or electronic notice of links
to all statements, reports and notices made available to Borrower’s security holders or to any
holders of Subordinated Debt and all reports on Form 10-K, 10-Q and 8-K filed with the Securities
and Exchange Commission; (iv) a prompt report of any legal actions pending or threatened against
Borrower or any Subsidiary that could result in damages or costs to Borrower or any Subsidiary of
One Hundred Thousand Dollars ($100,000.00) or more; (v) Board approved financial projections within
thirty (30) days after such approval; and (vi) budgets, sales projections, operating plans or other
financial information reasonably requested by Agent.

          (b) Within thirty (30) days after the last day of each month, Borrower shall deliver to Agent
with the monthly financial statements a Compliance Certificate signed by a Responsible Officer in
the form of Exhibit C.

     6.3 Inventory; Returns.

     Borrower shall keep all Inventory in good and marketable condition, free from material
defects. Returns and allowances between Borrower and its account debtors shall follow Borrower’s
customary practices as they exist at the Closing Date. Borrower must promptly notify Agent of all
returns, recoveries, disputes and claims, that involve more than Fifty Thousand Dollars
($50,000.00).

     6.4 Taxes.

     Borrower shall make, and cause each Subsidiary to make, timely payment of all material
federal, state, and local taxes or assessments (other than taxes and assessments which Borrower is
contesting in good faith, with adequate reserves maintained in accordance with GAAP) and will
deliver to Agent, on demand, appropriate certificates attesting to such payments.

     6.5 Insurance.

     Borrower shall keep its business and the Collateral insured for risks and in amounts, and as
Lenders and Agent may reasonably request. Insurance policies shall be in a form, with companies,
and in amounts that are satisfactory to Lenders and Agent and customary for businesses in
Borrower’s industry which are similarly situated. All property policies shall have a lender’s loss
payable endorsement showing each Lender as an additional loss payee and all liability policies
shall show the Lenders and Agent as an additional insured and all policies shall provide that the
insurer must give Agent on behalf of Lenders at least twenty (20) days notice before canceling its
policy. At Agent’s request, Borrower shall deliver certified copies of policies and evidence of
all premium payments. Proceeds payable under any policy shall, at Agent’s option, be payable to
Agent on behalf of Lenders on account of the Obligations. Notwithstanding the foregoing, so long
as no Event of Default has occurred and is continuing, Borrower shall have the option of applying
the proceeds of any casualty policy up to One Hundred Thousand Dollars ($100,000.00), in the
aggregate, toward the replacement or repair of destroyed or damaged property; provided that (i) any
such replaced or repaired property (a) shall be of equal or like value as the replaced or repaired
Collateral and (b) shall be deemed Collateral in which Lenders have been granted a first priority
security interest and (ii) after the occurrence and during the continuation of an Event of Default
all proceeds payable under such casualty policy shall, at the option of Agent, be payable to Agent,
for the ratable benefit of the Lenders, on account of the Obligations. If Borrower fails to obtain
insurance as required under Section 6.5 or to pay any amount or furnish any required proof of
payment to third persons and Agent, Agent may make all or part of such payment or obtain such
insurance policies required in Section 6.5, and take any action under the policies Agent deems
prudent.

     6.6 Accounts

          (a) In order to permit Agent to monitor Borrower’s financial performance and condition,
Borrower, and all Borrower’s Subsidiaries, shall maintain Borrower’s, and such Subsidiaries,
primary depository and operating accounts with Agent, which accounts shall represent at least
eighty percent (80.0%) of the dollar value of

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Borrower’s and such Subsidiaries’ accounts at all financial institutions. Any Guarantor shall
maintain all depository, operating and securities accounts with Agent or SVB Securities.

          (b) Borrower shall identify to Agent, in writing, any bank or securities account opened by
Borrower with any institution other than Agent. In addition, for each such account that Borrower
or Guarantor at any time opens or maintains, Borrower shall, at Agent’s request and option,
pursuant to an agreement in form and substance reasonably acceptable to the Lenders and Agent,
cause the depository bank or securities intermediary to agree that such account is the collateral
of Agent, and enter into a “control agreement” on behalf of Lenders pursuant to the terms
hereunder. The provisions of the previous sentence shall not apply to deposit accounts exclusively
used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit
of Borrower’s employees.

     6.7 Further Assurances.

     Borrower shall execute any further instruments and take further action as Agent reasonably
requests to perfect or continue Agent’s and Lenders’ security interest in the Collateral or to
effect the purposes of this Agreement.

7 NEGATIVE COVENANTS

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

     7.1 Dispositions.

     Convey, sell, lease, transfer, assign or otherwise dispose of (collectively a “Transfer”), or
permit any of its Subsidiaries to Transfer, all or any part of its business or property, including
the Intellectual Property, except for Transfers of (a) Inventory in the ordinary course of
business; (b) non-exclusive licenses and similar arrangements for the use of the property of
Borrower or its Subsidiaries in the ordinary course of business; or (c) worn-out, surplus, or
obsolete Equipment. Borrower shall not enter into an agreement with any Person other than the
Lenders which restricts the subsequent granting to Agent or Lenders of a security interest in the
Intellectual Property.

     7.2 Changes in Business, Ownership, Management or Locations of Collateral.

     Engage in or permit any of its Subsidiaries to engage in any business other than the
businesses currently engaged in by Borrower or reasonably related thereto, or have a material
change in its ownership (other than by the sale of Borrower’s equity securities in a public
offering or to venture capital investors so long as Borrower identifies to Agent the venture
capital investors prior to the closing of the investment), or management. Borrower shall not,
without at least twenty (20) days prior written notice to Agent: (a) relocate its chief executive
office, or add any new offices or business locations, including warehouses (unless such new
offices or business locations contain less than Fifty Thousand Dollars ($50,000.00) in Borrower’s
assets or property), or (b) change its jurisdiction of organization, or (c) change its
organizational structure or type, or (d) change its legal name, or (e) change any organizational
number (if any) assigned by its jurisdiction of organization.

     7.3 Mergers or Acquisitions.

     Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any
other Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of
the capital stock or property of another Person except where (a) total consideration including cash
and the value of any non-cash consideration, for all such transactions does not in the aggregate
exceed $1,000,000 in any fiscal year of Borrower; (b) no Event of Default has occurred and is
continuing or would exist immediately after giving effect to the transactions; and (c) Borrower is
the surviving legal entity. A Subsidiary may merge or consolidate into another Subsidiary or into
Borrower.

     7.4 Indebtedness.

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

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     7.5 Encumbrance.

     Create, incur, or allow any Lien on any of its property, including the Intellectual Property,
or assign or convey any right to receive income, including the sale of any Accounts, or permit any
of its Subsidiaries to do so, except for Permitted Liens, or permit any Collateral not to be
subject to the first priority security interest granted herein. The Collateral may also be subject
to Permitted Liens.

     7.6 Distributions; Investments.

     (a) Directly or indirectly acquire or own any Person, or make any Investment in any Person,
other than Permitted Investments, or permit any of its Subsidiaries to do so; or (b) pay any
dividends or make any distribution or payment on or redeem, retire or purchase any capital stock
provided that (i) Borrower may convert any of its convertible securities into other securities
pursuant to the terms of such convertible securities or otherwise in exchange thereof; (ii)
Borrower may pay dividends solely in common stock; and (iii) Borrower may repurchase the stock of
former employees or consultants pursuant to stock repurchase agreements so long as an Event of
Default does not exist at the time of such repurchase and would not exist after giving effect to
such repurchase, provided such repurchase does not exceed in the aggregate of One Hundred thousand
Dollars ($100,000.00) per fiscal year.

     7.7 Transactions with Affiliates.

     Directly or indirectly enter into or permit to exist any material transaction with any
Affiliate of Borrower, except for transactions that are in the ordinary course of Borrower’s
business (it being understood that employment arrangements with executive officers are within such
ordinary course of business), upon fair and reasonable terms that are no less favorable to Borrower
than would be obtained in an arm’s length transaction with a non-affiliated Person.

     7.8 Subordinated Debt.

     Make or permit any payment on any Subordinated Debt, except under the terms of such
Subordinated Debt, or amend any provision in any document relating to the Subordinated Debt,
without Agent’s prior written consent.

     7.9 Compliance.

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

8 EVENTS OF DEFAULT

     Any one of the following shall constitute an Event of Default:

     8.1 Payment Default.

     Borrower fails to pay any of the Obligations within three (3) Business Days after their due
date. During such three (3) day period the failure to cure the default shall not constitute an
Event of Default (but no Credit Extension shall be made during such cure period).

     8.2 Covenant Default.

     (a) If Borrower fails to perform any obligation under Sections 6.2 or 6.6, or violates any of
the covenants contained in Article 7 of this Agreement, or

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     (b) If Borrower fails or neglects to perform, keep, or observe any other material term,
provision, condition, covenant, or agreement contained in this Agreement, any of the Loan
Documents, or in any present or future agreement between Borrower and Lenders and as to any default
under such other material term, provision, condition, covenant or agreement that can be cured, has
failed to cure the default within ten (10) days after the occurrence thereof; provided, however,
that if the default cannot by its nature be cured within the ten (10) day period or cannot after
diligent attempts by Borrower be cured within such ten (10) day period, and such default is likely
to be cured within a reasonable time, then Borrower shall have an additional period (which shall
not in any case exceed thirty (30) days) to attempt to cure such default, and within such
reasonable time period the failure to have cured such default shall not be deemed an Event of
Default (provided that no Credit Extensions will be made during such cure period). Grace periods
provided under this section shall not apply, among, other things, to any covenants that are
required to be satisfied, completed or tested by a date certain.

     8.3 Intentionally deleted.

     8.4 Attachment.

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

     8.5 Insolvency.

     (a) Borrower is unable to pay its debts (including trade debts) as they become due or
otherwise becomes insolvent; (b) Borrower begins an Insolvency Proceeding; or (c) an Insolvency
Proceeding is begun against Borrower and not dismissed or stayed within thirty (30) days (but no
Credit Extensions shall be made before any Insolvency Proceeding is dismissed).

     8.6 Other Agreements.

     If there is a default in any agreement to which Borrower is a party with a third party or
parties resulting in a right by such third party or parties, whether or not exercised, to
accelerate the maturity of any Indebtedness in an amount in excess of One Hundred Thousand Dollars
($100,000.00).

     8.7 Judgments.

     If a judgment or judgments for the payment of money in an amount, individually or in the
aggregate, of at least One Hundred Thousand Dollars ($100,000.00) shall be rendered against
Borrower and shall remain unsatisfied and unstayed for a period of fifteen (15) days (provided that
no Credit Extensions will be made prior to the satisfaction or stay of such judgment).

     8.8 Misrepresentations.

     If Borrower or any Person acting for Borrower makes any material misrepresentation or material
misstatement now or later in any warranty or representation in this Agreement or in any writing
delivered to Agent and/or Lenders or to induce Agent and/or Lenders to enter this Agreement or any
Loan Document.

     8.9 Subordinated Debt.

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     A default or breach occurs under any agreement between Borrower and any creditor of Borrower
that signed a subordination agreement with Lenders or any creditor that has signed a subordination
agreement with Lenders breaches any terms of the subordination agreement.

     8.10 Guaranty.

     (a) Any guaranty of any Obligations terminates or ceases for any reason to be in full force;
or (b) any Guarantor does not perform any obligation or covenant under any guaranty of the
Obligations; or (c) any material misrepresentation or material misstatement exists now or later in
any warranty or representation in any guaranty of the Obligations or in any certificate delivered
to Agent in connection with the guaranty; or (d) any circumstance described in Articles 7 or 8
occurs to any Guarantor, or (e) the liquidation, winding up, termination of existence, or
insolvency of any Guarantor.

     8.11 Lien Priority

     There is a material impairment in the priority of Lenders’ security interest in the Collateral.

     8.12 Cross-Default

     An Event of Default occurs under the SVB Loan Arrangement.

9 RIGHTS AND REMEDIES

     9.1 Rights and Remedies.

     When an Event of Default occurs and continues Agent may, without notice or demand, do any or
all of the following:

          (a) Declare all Obligations immediately due and payable (but if an Event of Default described
in Section 8.5 occurs all Obligations are immediately due and payable without any action by Agent
and/or Lenders);

          (b) Stop advancing money or extending credit for Borrower’s benefit under this Agreement or
under any other agreement between Borrower and Agent and/or Lenders;

          (c) Settle or adjust disputes and claims directly with account debtors for amounts, on terms
and in any order that Agent considers advisable, and notify any Person owing Borrower money of
Agent’s, and Lenders’ security interest in such funds and verify and/or collect the amounts owed by
such account debtor. After the occurrence of an Event of Default, any amounts received by Borrower
shall be held in trust by Borrower for Agent, and, if requested by Agent, Borrower shall
immediately deliver such receipts to Agent in the form received from the account debtor, with
proper endorsements for deposit;

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

          (e) Apply to the Obligations any (i) balances and deposits of Borrower it holds, or (ii) any
amount held by Agent or Lenders owing to or for the credit or the account of Borrower;

          (f) Ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for
sale, and sell the Collateral. Agent is hereby granted a non-exclusive, royalty-free license or
other right to use, without charge, Borrower’s labels, Patents, Copyrights, Mask Works, rights of
use of any name, trade secrets, trade names, Trademarks, service marks, and advertising matter, or
any similar property as it pertains to the Collateral, in

11

 

completing production of, advertising for sale, and selling any Collateral and, in connection
with Agent’s exercise of its rights under this Section, Borrower’s rights under all licenses and
all franchise agreements inure to Agent for benefit of Lenders;

          (g) Place a “hold” on any account maintained with Agent or Lenders and/or deliver a notice of
exclusive control, any entitlement order, or other directions or instructions pursuant to any
control agreement or similar agreements providing control of any Collateral; and

          (h) Exercise all rights and remedies and dispose of the Collateral according to the Code.

     9.2 Power of Attorney.

     Borrower hereby irrevocably appoints Agent as its lawful attorney-in-fact, to be effective
upon the occurrence and during the continuance of an Event of Default, to: (a) endorse Borrower’s
name on any checks or other forms of payment or security; (b) sign Borrower’s name on any invoice
or bill of lading for any Account or drafts against account debtors; (c) settle and adjust disputes
and claims about the Accounts directly with account debtors, for amounts and on terms Agent
determines reasonable; (d) make, settle, and adjust all claims under Borrower’s insurance policies;
and (e) transfer the Collateral into the name of Agent for the benefit of Lenders or a third party
as the Code permits. Borrower hereby appoints Agent as its lawful attorney-in-fact to sign
Borrower’s name on any documents necessary to perfect or continue the perfection of any security
interest in the Collateral regardless of whether an Event of Default has occurred until all
Obligations have been satisfied in full and Agent and Lenders are under no further obligation to
make Credit Extensions hereunder. Agent’s foregoing appointment as Borrower’s attorney in fact,
and all of Agent’s rights and powers, coupled with an interest, are irrevocable until all
Obligations have been fully repaid and performed and Lenders’ and Agent’s obligation to provide
Credit Extensions terminates.

     9.3 Lenders’ Expenses

     Any amounts paid by Lenders as provided herein shall constitute Lenders’ Expenses and are
immediately due and payable, and shall bear interest at the then applicable rate hereunder and be
secured by the Collateral. No payments by Lenders shall be deemed an agreement to make similar
payments in the future or Agent’s and Lenders’ waiver of any Event of Default.

     9.4 Agent’s and Lenders’ Liability for Collateral.

     So long as Agent and Lenders comply with reasonable banking practices regarding the
safekeeping of Collateral and Section 9-207 of the Code, Agent and Lenders shall not be liable or
responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage to the Collateral;
(c) any diminution in the value of the Collateral; or (d) any act or default of any carrier,
warehouseman, bailee, or other Person. Borrower bears all risk of loss, damage or destruction of
the Collateral.

     9.5 Remedies Cumulative.

     Agent’s rights and remedies under this Agreement, the Loan Documents, and all other agreements
are cumulative. Agent has all rights and remedies provided under the Code, by law, or in equity.
Agent’s exercise of one right or remedy is not an election, and Agent’s waiver of any Event of
Default is not a continuing waiver. Agent’s delay is not a waiver, election, or acquiescence. No
waiver hereunder shall be effective unless signed by Agent and each Lender and then is only
effective for the specific instance and purpose for which it was given.

     9.6 Demand Waiver.

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

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10 NOTICES

     All notices or demands by any party to this Agreement or any related agreement must be in
writing and be personally delivered or sent by an overnight delivery service, by certified mail,
postage prepaid, return receipt requested, or by facsimile at the addresses listed below. Either
Lender, Agent or Borrower may change its notice address by giving the other party written notice.

	 	 	 	 	 	 	 	 	 
	 	 	If to Borrower:	 	CAVIUM NETWORKS
	 	 	 	 	805 E. Middlefield Road
	 	 	 	 	Mountain View, California 94043
	 	 	 	 	Attn: Art Chadwick, Chief Financial Officer
	 

	 	 	 	Fax:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	If to Agent:	 	Silicon Valley Bank
	 	 	or SVB:	 	3003 Tasman Drive
	 	 	 	 	Santa Clara, California 95054-1191
	 	 	 	 	Attn: Chitra Suriyanarayanan, Relationship Manager
	 	 	 	 	Fax: (408) 654-5517
	 
	 	 	 	 	 	 	 	 
	 	 	with a copy to:	 	Riemer & Braunstein LLP
	 	 	 	 	Three Center Plaza
	 	 	 	 	Boston, Massachusetts 02108
	 	 	 	 	Attn: David A. Ephraim, Esquire
	 	 	 	 	Fax: (617) 880-3456
	 
	 	 	 	 	 	 	 	 
	 	 	If to Gold Hill:	 	Gold Hill Venture Lending 03, L.P.
	 	 	 	 	3003 Tasman Drive
	 	 	 	 	Santa Clara, California 95054-1191
	 	 	 	 	Attn: Mr. Robert Helm
	 	 	 	 	Fax: (408) 654-6256

11 CHOICE OF LAW , VENUE AND JURY TRIAL WAIVER

     California law governs the Loan Documents without regard to principles of conflicts of law.
Borrower and Lenders, and Agent each submit to the exclusive jurisdiction of the State and Federal
courts in California and Borrower accepts jurisdiction of the courts and venue in Santa Clara
County, California. NOTWITHSTANDING THE FOREGOING, AGENT SHALL HAVE THE RIGHT TO BRING ANY ACTION
OR PROCEEDING AGAINST BORROWER OR ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION WHICH AGENT
DEEMS NECESSARY OR APPROPRIATE IN ORDER TO REALIZE ON THE COLLATERAL OR TO OTHERWISE ENFORCE THE
LENDERS’ OR AGENT’S RIGHTS AGAINST BORROWER OR ITS PROPERTY.

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

12 GENERAL PROVISIONS

     12.1 Successors and Assigns.

     This Agreement binds and is for the benefit of the successors and permitted assigns of each
party. Borrower may not assign this Agreement or any rights or Obligations under it without
Agent’s prior written consent which may be granted or withheld in Agent’s discretion. Lenders and
Agent have the right, without the consent of or notice to Borrower, to sell, transfer, assign,
negotiate, or grant participation in all or any part of, or any interest in,

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Lenders’ obligations, rights and benefits under this Agreement, the Loan Documents or any
related agreement, including, without limitation, an assignment to any Affiliate or any related
party.

     12.2 Indemnification.

     Borrower hereby indemnifies, defends and holds Agent and the Lenders and their respective
directors, officers, employees, and agents harmless against: (a) all obligations, demands, claims,
and liabilities asserted by any other party or Person in connection with the transactions
contemplated by the Loan Documents; and (b) all losses, or Lenders’ Expenses incurred, or paid by
Lenders and/or Agent from, following, or consequential to transactions between Lenders and Borrower
(including reasonable attorneys’ fees and expenses), except for losses caused by Lenders’ or
Agent’s gross negligence or willful misconduct.

     12.3 Attorneys’ Fees, Costs and Expenses.

     In any action or proceeding between Borrower and Agent arising out of the Loan Documents the
prevailing party will be entitled to recover its reasonable attorneys’ fees and other reasonable
costs and expenses incurred, in addition to any other relief to which it may be entitled.

     12.4 Right of Set Off.

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

     12.5 Time of Essence.

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

     12.6 Severability of Provision.

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

     12.7 Amendments in Writing, Integration.

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

     12.8 Counterparts.

     This Agreement may be executed in any number of counterparts and by different parties on
separate counterparts, each of which, when executed and delivered, are an original, and all taken
together, constitute one Agreement.

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     12.9 Survival.

     All covenants, representations and warranties made in this Agreement continue in full force
until this Agreement has terminated pursuant to its terms, and all Obligations (other than
Obligations under Section 12.2 to the extent they remain inchoate at the time the other outstanding
Obligations are paid in full) have been satisfied. The obligation of Borrower in Section 12.2 to
indemnify each Lender and Agent shall survive until the statute of limitations with respect to such
claim or cause of action shall have run.

     12.10 Confidentiality.

     In handling any confidential information, Lenders and Agent shall exercise the same degree of
care that it exercises for its own proprietary information (but no less than reasonable care), but
disclosure of information may be made: (a) to Lenders’ and Agent’s subsidiaries or affiliates in
connection with their business with Borrower; (b) to prospective transferees or purchasers of any
interest in the Credit Extensions (provided, however, Lenders and Agent shall use commercially
reasonable efforts in obtaining such prospective transferee’s or purchaser’s agreement to the terms
of this provision); (c) as required by law, regulation, subpoena, or other order; (d) as required
in connection with Lenders’ and Agent’s examination or audit; and (e) as Agent considers
appropriate in exercising remedies under this Agreement. Confidential information does not include
information that either: (i) is in the public domain or in Lenders’ and/or Agent’s possession when
disclosed to Lenders and/or Agent, or becomes part of the public domain after disclosure to Lenders
and/or Agent (other than as a result of Bank’s disclosure); or (ii) is disclosed to Lenders and/or
Agent by a third party, if Lenders and/or Agent does not know that the third party is prohibited
from disclosing the information.

13 DEFINITIONS

     13.1 Definitions.

     In this Agreement:

     “Accounts” are all existing and later arising accounts, contract rights, and other obligations
owed Borrower in connection with its sale or lease of goods (including licensing software and other
technology) or provision of services, all credit insurance, guaranties, other security and all
merchandise returned or reclaimed by Borrower and Borrower’s Books relating to any of the
foregoing, as such definition may be amended from time to time according to the Code.

     “Advance” or “Advances” is defined in Section 2.1.1(a).

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

     “Agent” means, SVB, not in its individual capacity, but solely in its capacity as agent on
behalf of and for the benefit of the Lenders.

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

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

     “Closing Date” is the date of this Agreement.

     “Code” is the Uniform Commercial Code as adopted in California as amended and in effect from
time to time.

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     “Collateral” is any and all properties, rights and assets of Borrower granted by Borrower to
Agent and Lenders or arising under the Code, now, or in the future, in which Borrower obtains an
interest, or the power to transfer rights, in the property described on Exhibit A.

     “Commitment” is the outstanding amount of Obligations based on each Lender’s Commitment
Percentage.

     “Commitment Percentage” is set forth in Schedule 1.1, as amended from time to time.

     “Commitment Termination Date” is the earlier of July 31, 2006 and the written termination of
this Agreement by Borrower.

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

     “Copyrights” are all copyright rights, applications or registrations and like protections in
each work or authorship or derivative work, whether published or not (whether or not it is a trade
secret) now or later existing, created, acquired or held.

     “Credit Extension” is each Advance, or any other extension of credit by Lenders for Borrower’s
benefit.

     “Equipment” is all present and future machinery, equipment, tenant improvements, furniture,
fixtures, vehicles, tools, parts and attachments in which Borrower has any interest.

     “Final Payment” is a payment (in addition to and not a substitution for the regular monthly
payments of principal plus accrued interest) due on the Maturity Date for such Advance equal to the
Loan Amount for such Advance multiplied by the Final Payment Percentage.

     “Final Payment Percentage” is, for each Advance, three percent (3.0%).

     “Funding Date” is any date on which an Advance is made to or on account of Borrower.

     “GAAP” is generally accepted accounting principles in the United States, consistently applied.

     “Guarantor” is any present or future guarantor of the Obligations.

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

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

     “Intellectual Property” is any Copyrights, Copyright rights, Copyright applications, Copyright
registrations and like protections in each work of authorship and derivative work, whether
published or unpublished,

16

 

now owned or later acquired; any Patents, Trademarks, service marks and applications therefor;
any trade secret rights, including any rights to unpatented inventions, now owned or hereafter
acquired.

     “Inventory” is present and future inventory in which Borrower has any interest, including
merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and
finished products intended for sale or lease or to be furnished under a contract of service, of
every kind and description now or later owned by or in the custody or possession, actual or
constructive, of Borrower, including inventory temporarily out of its custody or possession or in
transit and including returns on any accounts or other proceeds (including insurance proceeds) from
the sale or disposition of any of the foregoing and any documents of title.

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

     “Lender” is any one of the Lenders.

     “Lenders” shall mean the Persons identified on Schedule 1.1 hereto and each assignee that
becomes a party to this Agreement pursuant to Section 12.1.

     “Lenders’ Expenses” are all audit fees and expenses and reasonable costs or expenses
(including reasonable attorneys’ fees and expenses) of Agent and Lenders for preparing,
negotiating, administering, defending and enforcing the Loan Documents (including appeals or
Insolvency Proceedings).

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

     “Loan Amount” in respect to each Advance is the original principal amount of such Advance.

     “Loan Documents” are, collectively, this Agreement, any guaranties executed by any Guarantor,
and any other present or future agreement between Borrower and/or for the benefit of Lenders and
Agent in connection with this Agreement, all as amended, extended or restated.

     “Mask Works” are all mask works or similar rights available for the protection of
semiconductor chips, now owned or later acquired.

     “Obligations” are liabilities, obligations, covenants, agreements, debts, principal, interest,
Final Payment, Interim Payment, Prepayment Fee, Lenders’ Expenses, and other amounts Borrower owes
Lenders and/or Agent now or later under or in connection with this Agreement, including interest
accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of Borrower
assigned to Lenders and/or Agent.

     “Patents” are patents, patent applications and like protections, including improvements,
divisions, continuations, renewals, reissues, extensions and continuations-in-part of the same.

     “Payment Date” is defined in Section 2.3(a).

     “Permitted Indebtedness” is:

          (a) Borrower’s indebtedness to Lenders and Agent under this Agreement or the Loan Documents;

          (b) Indebtedness existing on the Closing Date and shown on the Representations and Warranties
Certificate;

          (c) Subordinated Debt;

          (d) Indebtedness to trade creditors incurred in the ordinary course of business and with
respect to surety bonds and similar obligations incurred in the ordinary course of business;

17

 

          (e) Indebtedness in an aggregate principal amount (including aggregate amounts permitted under
subsections (f) and (h) hereof) not to exceed Four Hundred Thousand Dollars ($400,000.00) secured
by Permitted Liens;

          (f) Indebtedness of Borrower to any Subsidiary and Contingent Obligations of any Subsidiary
with respect to obligations of Borrower (provided that the primary obligations are not prohibited
hereby) and Indebtedness of any Subsidiary to any other Subsidiary and Contingent Obligations of
any Subsidiary with respect to obligations of any other Subsidiary (provided that the primary
obligations are not prohibited hereby);

          (g) Indebtedness arising from the endorsement of instruments in the ordinary course of
business;

          (h) Other Indebtedness not otherwise permitted by Section 7.4 not exceeding
(including aggregate amounts permitted under subsections (e) and (f) hereof) Four Hundred Thousand
Dollars ($400,000.00) in the aggregate outstanding at any time; and

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

     “Permitted Investments” are:

          (a) Investments shown on the Representations and Warranties Certificate and existing on the
Closing Date; and

          (b) (i) marketable direct obligations issued or unconditionally guaranteed by the United
States or its agency or any state maturing within 1 year from its acquisition, (ii) commercial
paper maturing no more than 1 year after its creation and having the highest rating from either
Standard & Poor’s Corporation or Moody’s Investors Service, Inc., (iii) SVB’s certificates of
deposit issued maturing no more than 1 year after issue, and (iv) any other investments
administered through the Lenders; and

          (c) Investments consisting of (i) travel advances and employee relocation loans and
other employee loans and advances in the ordinary course of business, and (ii) loans to employees,
officers or directors relating to the purchase of equity securities of Borrower or its Subsidiaries
pursuant to employee stock purchase plans or agreements approved by Borrower’s Board of Directors,
up to One Hundred Thousand Dollars ($100,000) in the aggregate on a combined basis with respect to
subsections (i) and (ii) hereof in any fiscal year;

          (d) Investments (including debt obligations) received in connection with bankruptcy or
reorganization of customers or suppliers and in settlement of delinquent obligations of, and other
disputes with, customers or suppliers arising in the ordinary course of business;

          (e) Investments consisting of notes receivable of, or prepaid royalties and other credit
extensions, to customers and suppliers who are not Affiliates of Borrower, in the ordinary course
of business; provided that this paragraph (e) shall not apply to Investments of Borrower in any
Subsidiary;

          (f) Joint ventures or strategic alliances (in the ordinary course of Borrower’s business)
consisting of the non-exclusive licensing of technology, the development of technology or the
providing of technical support, provided that any cash investments by Borrower do not exceed
$100,000 in the aggregate in any fiscal year, provided that no such cash investment may be made if
an Event of Default is then occurring or would otherwise upon the making thereof;

          (g) Investments pursuant to or arising under currency agreements or interest rate agreements
entered into in the ordinary course of business;

18

 

          (h) Investments consisting of deposit accounts and securities accounts of Borrower, subject to
the compliance by Borrower with the covenant set forth in Section 6.6 hereof;

          (i) Investments of Subsidiaries in or to other Subsidiaries of Borrower and Investments by
Borrower in Subsidiaries not to exceed $100,000 in the aggregate in any fiscal year; and

          (j) Investments accepted in connection with Transfers permitted by Section 7.1;

          (k) Other Investments not otherwise permitted by Section 7.6 not exceeding $100,000 in
the aggregate outstanding at any time.

     “Permitted Liens” are:

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

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

          (c) Purchase money Liens (and including for purposes of this clause Liens incurred in
connection with capital leases) (i) on Equipment acquired or held by Borrower incurred for
financing the acquisition of the Equipment securing no more than One Hundred Thousand Dollars
($100,000.00) in the aggregate amount outstanding, or (ii) existing on equipment when acquired, if
the Lien is confined to the property and improvements and the proceeds of the equipment;

          (d) Leases or subleases of real property granted in the ordinary course of business, and
leases, subleases, licenses or sublicenses of property (other than real property or intellectual
property) granted in the ordinary course of Borrower’s business, if the leases, subleases,
licenses and sublicenses do not prohibit granting Bank a security interest;

          (e) Statutory Liens securing claims or demands of materialmen, mechanics, carriers,
warehousemen, landlords, repairmen, employees or other like Persons imposed without action of such
parties;

          (f) Liens arising from judgments, decrees or attachments in circumstances not constituting an
Event of Default under Section 8.4 or 8.7;

          (g) Liens in favor of other financial institutions arising in connection with Borrower’s
deposit accounts or securities accounts held at such institutions to secure payment of fees and
similar costs and expenses;

          (h) Liens to secure payment of worker’s compensation, employment insurance, old age pensions
or other social security obligations of Borrower in each case arising in the ordinary course of
business of Borrower;

          (i) easements, reservations, rights-of-way, restrictions, minor defects or irregularities in
title and similar charges or encumbrances affecting real property not constituting a material
adverse effect on the business or condition (financial or otherwise) of Borrower or otherwise
materially impairing the conduct of Borrower’s business;

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

          (k) Liens on insurance proceeds in favor of insurance companies granted solely as security for
financed premiums;

19

 

          (l) Liens in favor of customs and revenue authorities arising as a matter of law to secure
payment of customs duties in connection with the importation of goods;

          (m) Liens which constitute rights of offset of a customary nature that are not prior to the
Bank’s security interests;

          (n) Liens arising from the filing of any financing statement relating to operating leases
otherwise permitted hereunder;

          (o) Liens on escrowed cash representing a portion of the proceeds of sales of assets
established to satisfy contingent post-closing obligations that it owes (including earn-outs,
indemnities, and working capital adjustments);

          (p) Liens on cash collateral securing reimbursement obligations to Bank under letters of
credit;

          (q) Liens on earnest money deposit required under a letter of intent or purchase agreement;
and

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

     Notwithstanding the foregoing, Permitted Liens pursuant to subsections (i) through (q) may not
secure in excess of $500,000 in the aggregate at any time.

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

     “Prepayment Fee” shall be an amount equal to three percent (3.0%) of the amount prepaid.

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

     “Repayment Period” as to each Advance, is a period of time equal to thirty (30) consecutive
months.

     “Representations and Warranties Certificate ” is defined in Section 5.1.

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

     “Schedule” is any attached schedule of exceptions.

     “Scheduled Payment” is defined in Section 2.3(b).

     “Subordinated Debt” is debt incurred by Borrower subordinated to Borrower’s debt to Lenders
(pursuant to a subordination agreement entered into between Agent, Borrower and the subordinated
creditor), on terms acceptable to Agent and Lenders.

     “Subsidiary” is any Person, or any other business entity of which more than 50% of the voting
stock or other equity interests is owned or controlled, directly or indirectly, by the Person or
one or more Affiliates of the Person.

     “SVB Loan Arrangement” is a loan arrangement entered into by and between Borrower and Silicon
Valley Bank dated as of even date herewith.

     “Term Loan” is an Advance or Advances of up to Four Million Dollars ($4,000,000.00).

20

 

     “Term Loan Amortization Date” shall mean the earlier of (i) the date which is six (6) months
from the subject Advance, or (ii) December 31, 2006.

     “Trademarks” are trademark and service mark rights, registered or not, applications to
register and registrations and like protections, and the entire goodwill of the business of
Borrower connected with the trademarks.

21

 

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

	 	 	 	 	 	 	 
	 	 	BORROWER:
	 
	 	 	 	 	 	 
	 	 	CAVIUM NETWORKS
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Arthur Chadwick
 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:
	 	Arthur Chadwick	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:
	 	CFO	 	 
	 
	 	 	 	 	 	 
	 	 	SILICON VALLEY BANK, as Agent and as a LENDER
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Chitra Suriyanarayanan	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:
	 	Chitra Suriyanarayanan	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:
	 	RM	 	 
	 
	 	 	 	 	 	 
	 	 	GOLD HILL VENTURE LENDING 03, L.P., as LENDER
	 
	 	 	 	 	 	 
	 	 	By: GOLD HILL VENTURE LENDING PARTNERS

03, LLC, its General Partner
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Tim Waterson	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:
	 	Tim Waterson	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 

22

 

Schedule 1.1

Lenders and Commitments

	 	 	 	 	 	 	 	 	 
	Lender	 	Commitment	 	Commitment Percentage
	Silicon Valley Bank	 	$	1,250,000.00	 	 	 	31.25	%
	Gold Hill Venture Lending 03, L.P.	 	$	2,750,000.00	 	 	 	68.75	%
	TOTAL	 	$	4,000,000.00	 	 	 	100.00	%

23

 

EXHIBIT A

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

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

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

     The Collateral does not include:

     (a) Any Copyright rights, Copyright applications, Copyright registrations, Mask Works, and
like protections in each work of authorship and derivative work, whether published or unpublished,
now owned or later acquired; any Patents, Trademarks, service marks and applications therefor; any
trade secret rights, including any rights to unpatented inventions, now owned or hereafter acquired
and intent-to-use applications or any other items of Intellectual Property. Notwithstanding the
foregoing, the Collateral shall include all accounts, license and royalty fees and other revenues,
proceeds, or income arising out of or relating to any of the foregoing. To the extent a court of
competent jurisdiction holds that a security interest in any Intellectual Property is necessary to
have a security interest in any accounts, license and royalty fees and other revenues, proceeds, or
income arising out of or relating to any of the foregoing Intellectual Property, then the
Collateral shall, effective as of the Closing Date, include the Intellectual Property, to the
extent necessary to permit perfection of the Lenders’ security interest in such accounts, license
and royalty fees and other revenues, proceeds, or income arising out of or relating to any of the
Intellectual Property; and

     (b) more than 65% of the total combined voting power of all classes of stock entitled to vote
the shares of capital stock of any Subsidiary of Borrower not incorporated or organized under the
laws of one of the States or jurisdictions of the United States.

24

 

EXHIBIT B

Loan Payment/Advance Request Form

	 	 	 	 	 
	 

	 	Fax To:                     
                    
	 	Date:

	 	 	 	 	 
	 

	 	LOAN PAYMENT:
	 	 

 CAVIUM NETWORKS

	 	 	 	 	 	 	 	 	 
	 

	 	From Account #
	 	 	 	To Account #	 	 
	 

	 	 	 	(Deposit Account #)
	 	 	 	(Loan Account #)

	 	 	 	 	 
	 

	 	Principal $
	 	and/or Interest $

	 	 	 	 	 
	 

	 	Authorized Signature:
	 	Phone Number:

 

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

	 	 	 	 	 	 	 	 	 
	 

	 	From Account #
	 	 	 	To Account #	 	 
	 

	 	 	 	(Loan Account #)
	 	 	 	(Deposit Account #)

Amount of Advance $

All Borrower’s representation and warranties in the Loan and Security Agreement are true, correct and complete in all
material respects on the date of the telephone transfer request for an advance, but those representations and
warranties expressly referring to another date shall be true, correct and complete in all material respects as of such
date:

	 	 	 	 	 
	 

	 	Authorized Signature:
	 	Phone Number:

 

Outgoing Wire Request

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

Deadline for same day processing is 12:00pm, P.S.T.

	 	 	 
	Beneficiary Name:

	 	Amount of Wire: $
	 
	 	 
	Beneficiary Bank:

	 	Account Number:
	 
	 	 
	City and Sate:
	 	 
	 
	 	 
	Beneficiary Bank Transit (ABA) #: __ __ __ __ __ __ __ __ Beneficiary Bank Code (Swift, Sort, Chip, etc.):
	 
	 	 
	 

	 	           (For International Wire Only)
	Intermediary Bank:

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

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

	 	 	 
	Authorized Signature:

	 	2nd Signature (If Required):
	 
	 	 
	Print Name/Title:

	 	Print Name/Title:
	 
	 	 
	Telephone #

	 	Telephone #

25

 

EXHIBIT C

COMPLIANCE CERTIFICATE

TO: SILICON VALLEY BANK, AS AGENT

FROM: CAVIUM NETWORKS

     The undersigned authorized officer of Cavium Networks certifies that under the terms and
conditions of the Loan and Security Agreement between Borrower, Lenders, and Agent (the
“Agreement”), (i) Borrower is in complete compliance for the period ending                      with all
required covenants except as noted below and (ii) there are no Events of Default, and all
representations and warranties in the Agreement are true and correct in all material respects on
this date. Attached are the required documents supporting the certification. The Officer
certifies that these are prepared in accordance with Generally Accepted Accounting Principles
(GAAP) consistently applied from one period to the next except as explained in an accompanying
letter or footnotes. The Officer acknowledges that no borrowings may be requested at any time or
date of determination that Borrower is not in compliance with any of the terms of the Agreement,
and that compliance is determined not just at the date this certificate is delivered.

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

	 	 	 	 	 
	Reporting Covenant	 	Required	 	Complies
	Monthly financial statements with CC

	 	Monthly within 30 days
	 	Yes      No
	Annual financial statements (CPA Audited)
10-Q, 10-K and 8-K

	 	FYE within 120 days
Within 5 Business Days after
filing with SEC, but no later
than 50 days
after the relevant reporting
period
	 	Yes      No

Yes      No
	Board-approved projections

	 	Within 30 days of approval
	 	Yes     No

	 	 	 	 	 	 	 	 
	Comments Regarding Exceptions: See Attached.	 	 	AGENT USE ONLY	 	 
	Cavium Networks

	 	 	Received by:	 	 	 	 
	 

	 	 	 	 	 	 	 
	 

	 	 	 	 	          authorized signer	 	 
	 
	 	 	 	 	 	 	 
	Sincerely,

	 	 	Date:	 	 	 	 
	 

	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 
	Signature

	 	 	Verified:	 	 	 	 
	 

	 	 	 	 	 	 	 
	 

	 	 	 	 	          authorized signer	 	 
	Title

	 	 	Date:	 	 	 	 
	 

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	Date	 	 	Compliance Status: Yes           No	 	 

26

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