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Avago Technologies Limited
(the “Company”)
Policy on Acceleration of Executive Staff
Equity Awards in the Event of Death or Permanent Disability
September 2, 2015
This policy (the “Policy”) applies in the event of the death or Permanent Disability, as defined below, of (i) any officer of the Company, as such term is defined Rule 16a-1, promulgated under the Securities Exchange Act of 1934, as amended (each, an “Officer”) and (ii) any member of the Executive Staff, from time to time, of the Chief Executive Officer of the Company (the “CEO”), as determined by the CEO (each such person, an “Executive Staff Member” and together with the Officers, the “Covered Executives”).
The Board of Directors of the Company (the “Board”) believes that it is important to provide Covered Executives with certain benefits relating to their outstanding equity and equity-linked awards, as set forth below, upon his or her termination of service to the Company and its subsidiaries (collectively, “Avago”) due to death or Permanent Disability, to enhance Covered Executives’ financial security thereby providing incentive and encouragement to remain with Avago notwithstanding the possibility of such an event.
In the event an employee of Avago experiences a Covered Termination at a time when he or she is a Covered Executive, each outstanding and unvested Company equity and equity-linked award held by such employee that as of the Termination Date, pursuant to its terms, vests solely based upon continued service (including, without limitation, each time-based share option and restricted share unit award and each performance option and restricted share unit award for which the performance criteria has
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been met as of the Termination Date), shall automatically become vested and, if applicable, any forfeiture restrictions or rights of repurchase thereon shall immediately lapse, in each case, with respect to one-hundred percent (100%) of that number of unvested Company ordinary shares underlying such equity award as of the Termination Date.
“Covered Termination” means the termination of Covered Executive’s employment because of Covered Executive’s death or Permanent Disability, in each case, to the extent necessary, that constitutes a “Separation from Service” (as defined below).
“Permanent Disability” means the Covered Executive is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve (12) months.
“Termination Date” means the date Covered Executive experiences a Covered Termination.
Notwithstanding any provision to the contrary in this Policy, no amount deemed deferred compensation subject to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) shall be payable pursuant to this Policy unless Covered Executive’s termination of employment constitutes a “separation from service” with Avago within the meaning of Section 409A of the Code and the Department of Treasury regulations and other guidance promulgated thereunder (“Separation from Service”) and, except as provided in the following paragraph, any such amount shall be paid or distributed on the sixtieth (60th) day following the Covered Executive’s Separation from Service.
If the Covered Executive is deemed at the time of his or her Separation from Service to be a “specified employee” for purposes of Section 409A(a)(2)(B)(i) of the Code, to the extent delayed commencement of any portion of the benefits to which Executive is entitled under this Policy is required in order to avoid a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code, such portion of Covered Executive’s benefits shall not be provided to Executive (or such Executive’s heirs, executors, legatees, administrators or successors, as applicable) prior to the earlier of (a) the expiration of the six (6)-month period measured from the date of Executive’s Separation from Service or (b) the date of Executive’s death. Upon the first business day
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following the expiration of the applicable Code Section 409A(a)(2)(B)(i) period, all payments deferred pursuant to this paragraph shall be paid or distributed in a single lump sum to Executive.
Each Covered Executive’s employment with Avago is and shall continue to be “at-will,” as defined under applicable law.
The benefits provided under this Policy are intended to be additive to any benefits a Covered Executive becomes entitled to under any other policy, program, plan or agreement, notwithstanding any language therein to the contrary, unless the provision of benefits hereunder is deemed by the Committee to be duplicative. Any determination of the Committee shall be conclusive and binding on the Company and the applicable Covered Executive. The determination of the Committee need not be uniform with respect to one or more Covered Executives.
The Policy will be governed by and construed in accordance with the laws of the State of California.
The Board may amend, repeal or replace the Policy in whole or part at any time.
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Policy adopted: September 2, 2015
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