EXHIBIT 10.06
FLEXTRONICS INTERNATIONAL LTD.
EXECUTIVE INCENTIVE COMPENSATION RECOUPMENT POLICY
(Adopted May 13, 2010)
I. INTRODUCTION
The Board of Directors of Flextronics International Ltd. (the “Company”) has
determined that it is in the best interests of the Company to adopt a policy
(the “Policy”) providing for the Company’s recoupment of certain incentive
compensation paid to senior executives and other officers who are direct reports
of the chief executive officer under certain circumstances. In cases of a
material financial statement restatement where a Covered Officer’s fraud or
misconduct has caused the restatement, the Board may determine to recoup
incentive compensation which was paid or vested based upon the achievement of
certain financial results (including gains from the sale of vested shares) to
the extent that the amount of such compensation would have been lower if the
financial results had been properly reported and may seek to cancel equity
awards where the financial results of the Company were considered in granting
such awards.
II. EFFECTIVE DATE
This Policy shall apply to all Incentive Compensation paid or awarded on or
after the adoption of this Policy.
III. DEFINITIONS
For purposes of this Policy, the following terms shall have the meanings set
forth below:
“Covered Officers” shall mean executive officers designated by the Board as
officers for purposes of Section 16 of the Securities Exchange Act of 1934, as
amended, and any other officers who are direct reports of the chief executive
officer.
“Incentive Compensation” shall mean bonuses or awards under the Company’s short
and long-term incentive bonus plans, grants and awards under the Company’s
equity incentive plans, and contributions under the Company’s deferred
compensation plans where the contributions are based on the achievement of
financial results.
“Misconduct” shall mean a knowing violation of SEC rules and regulations or
Company policy. Determinations of Misconduct for purposes of this Policy shall
be made by the Board in its sole and absolute discretion (or, if the Board has
delegated such authority to the Compensation Committee, by the Compensation
Committee in its sole and absolute discretion) independently of, and the Board
(or the Compensation Committee) shall not be bound by determinations by
management that a Covered Officer has or has not met any particular standard of
conduct under law or Company policy.

 

 

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IV. RECOUPMENT OF INCENTIVE COMPENSATION
In the event of a material restatement of financial results, other than as a
result of a change in accounting principles (a “Restatement”) where a Covered
Officer engaged in fraud or Misconduct that caused the need for the Restatement,
the Board will review all Incentive Compensation paid (or, in the case of
equity-based compensation, which vested) to Covered Officers on the basis of
having met or exceeded specific performance targets for performance periods
during the Restatement period. To the extent permitted by applicable law, the
Board will seek to recoup Incentive Compensation, in all appropriate cases
(taking into account all relevant factors, including whether the assertion of a
recoupment claim may prejudice the interests of the Company in any related
proceeding or investigation), paid (or in the case of equity-based compensation,
which vested) to any Covered Officer on or after the Effective Date of this
Policy, if and to the extent that (i) the amount (or vesting) of Incentive
Compensation was calculated based upon the achievement of certain financial
results that were subsequently reduced due to a Restatement, and (ii) the amount
(or vesting) of Incentive Compensation that would have been paid (or, in the
case of equity-based compensation, vested) to the Covered Officer had the
financial results been properly reported would have been lower than the amount
actually paid (or, in the case of equity-based compensation, vested). In the
case of equity awards that vested based on the achievement of financial results
that were subsequently reduced, the Board also may seek to recover gains from
the sale or disposition of vested shares (including shares purchased upon the
exercise of options that vested based on the achievement of financial results).
In addition, the Board may to the extent it deems appropriate determine to
cancel outstanding equity awards where the Board or the Compensation Committee
took into account the financial performance of the Company in granting such
awards and the financial results were subsequently reduced due to such a
Restatement.
V. ACKNOWLEDGEMENT BY COVERED OFFICERS
Covered Officers shall acknowledge this Policy.
VI. BINDING EFFECT OF DETERMINATIONS BY BOARD; DELEGATION
The Board may delegate to the Compensation Committee all determinations to be
made and actions to be taken by the Board under this Policy. Any determination
made by the Board or the Compensation Committee under this Policy shall be
final, binding and conclusive on all parties.
VII. LIMITATION ON PERIOD FOR RECOUPMENT
The Board may only seek recoupment under Section IV of this Policy if the
Restatement shall have occurred within 36 months of the publication of the
audited financial statements that have been restated.

 

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VIII. SOURCES OF RECOUPMENT
The Board may seek recoupment from the Covered Officers from any of the
following sources: prior incentive compensation payments; future payments of
incentive compensation; cancellation of outstanding equity awards; future equity
awards; and direct repayment.
IX. SEVERABILITY
If any provision of this Policy or the application of any such provision to any
Covered Officer shall be adjudicated to be invalid, illegal or unenforceable in
any respect, such invalidity, illegality or unenforceability shall not affect
any other provisions of this Policy, and the invalid, illegal or unenforceable
provisions shall be deemed amended to the minimum extent necessary to render any
such provision or application enforceable.
X. NO IMPAIRMENT OF OTHER REMEDIES
This Policy does not preclude the Company from taking any other action to
enforce a Covered Officer’s obligations to the Company, including termination of
employment or institution of civil or criminal proceedings.
This Policy is in addition to the requirements of Section 304 of the
Sarbanes-Oxley Act of 2002 that are applicable to the Company’s Chief Executive
Officer and Chief Financial Officer.

 

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