Exhibit 10.1

  
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EMULEX CORPORATION
EXECUTIVE INCENTIVE COMPENSATION PLAN
TERMS & CONDITIONS (Effective June 30, 2014 to June 28, 2015)

PLAN PURPOSE

To focus members of the management team on the achievement of specific Company
and individual accomplishments which contribute to the creation of shareholder
value.

To assist in attracting and retaining top quality management.

GENERAL PLAN DESCRIPTION

These terms and conditions set forth within this document hereby govern the
interpretation, eligibility, and calculations for the Emulex Corporation (the
“Company”) Executive Incentive Compensation Plan (“EICP” or the “Plan”).

This Plan provides for an incentive cash payment (“Award”) based upon Company
performance against Net Revenue and Net Operating Income plan goals and
specified business goals as detailed below. In addition, a discretionary cash
payment for recognition of extraordinary contributions to the success of the
company may be recommended. All recommendations are subject to the approval of
the Compensation Committee of the Emulex Board of Directors.

ELIGIBILITY

Corporate officers, executive officers, operating officers, senior vice
presidents, vice presidents, senior directors, and directors, excluding those
eligible for sales commission (unless otherwise indicated in this Plan), are
eligible for selection to participate in this Plan. Actual Plan participants
will normally be selected from among those eligible annually, prior to the start
of each fiscal year, by the Chief Executive Officer and approved by the
Compensation Committee.

See the “Appendix” for a list of eligible positions/levels and targets covered
by this Plan.

TERM, PERFORMANCE PERIOD, AND PAYMENT

Plan Term – The Plan is effective on the first day of the Company’s fiscal year
and ends on the last day of the fiscal year.

Performance Period — The performance period is selected at the discretion of the
Company and may be:
◦
Quarterly: Beginning on the first day of the fiscal quarter and ending on the
last day of the fiscal quarter.

◦
Semi-Annual: Beginning on the first day of the fiscal quarter 1 and ending on
the last day of the fiscal quarter 2, and beginning on the first day of fiscal
quarter 3 and ending on the last day of fiscal quarter 4.

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◦
Annual: Beginning on the first day of the fiscal year and ending on the last day
of the fiscal year.

Payment — Awards are payable upon approval by the Compensation Committee, as
recommended by the CEO.
For FY15 there will be five performance periods weighted as follows:
•
80% of the target Award will be earned based on quarterly performance periods
equally weighted 20% each.

•
20% of the target Award will be tied to the full fiscal year performance period
(June 30, 2014 to June 28, 2015)

Performance Periods
Q1
Q2
Q3
Q4
Full Year
% of Target Incentive Award Earned
20%
20%
20%
20%
20%

TARGET AWARD OPPORTUNITY
Each Plan participant will be assigned a Target Award Opportunity expressed as a
percentage of his or her actual gross base salary in effect at the end of the
respective performance period based on job title.

Foreign Currency considerations – All Plan participants whose gross base salary
is not denominated in U.S. dollars will be paid in the same currency as their
gross base salary. All Award calculations will be made using the equivalent
gross base salary in US dollars.

TARGET AWARD CRITERIA
Target Award criteria will be based upon achievement of a combination of
performance goals. The Emulex Corporate metrics and associated weighting are:

Operating Unit
Emulex Corporate Plan - Metric Weightings
Metric
Emulex Revenue
Emulex Net Operating Income
Weighting
40%
60%

A separate metrics and weighting scheme will be applied to Target Award criteria
for Plan participants in the Company’s Endace Division1. For FY15, it will be:
 
Endace Division Plan Metrics Weightings
Operating Unit
Emulex Corporate Metric Weightings
Endace Division Metrics Weightings
Metric
Emulex Revenue
Emulex Net Operating Income
Endace Revenue
Endace Pre-EICP
Operating Income
Weighting
8%
12%
36%
44%
Overall Weighting
20% Emulex Corporation Weighting
80% Endace Division Weighting

________________________________________________________ 
1 The Endace Division is one operating unit. The entire company, including the
Endace Division, is another operating unit, and is referred to as Emulex
Corporation.

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For both groups, the Award pool will be established based on the following:

CORPORATE PERFORMANCE GOAL
THRESHOLD (MINIMUM)*
AOP
MAXIMUM
ACHIEVEMENT %
70.00%
100.00%
133.33%
AWARD - % EARNED
50.0%
85.0%
150.0%
* Note: No Award will be deemed earned or payable if Net Operating Income for
the Operating Unit’s applicable performance periods falls below 50% of the AOP
approved plan. In the case of participants with a target Award based on the
performance of more than one Operating Unit, the portion of the Award based on
the performance of a particular Operating Unit will not be deemed earned or
payable if Net Operating Income for that Operating Unit’s applicable performance
periods falls below 50% of the AOP approved plan.

The actual goals for measurement purposes will be based upon the Company's
fiscal Annual Operating Plan (AOP) as approved by the Emulex Board of Directors.
Corporate incentive components will be calculated according to the following
procedure (assumes quarterly performance period):

1.
The Target Award opportunity times the participant’s quarterly gross base salary
equals the Target Award.

Example :     35% x $100,000 (annual salary) = $35,000 Total Target Award. Each
performance period will have a target award of $7,000
    
2.
The weighting factors for net revenue, net operating income as stated above
times the Target Award give the incentive target for each weighting factor.

Example :     40% x $7,000 = $2,800 (net revenue target)    
60% x $7,000 = $4,200 (net operating income target)

3.
The Award payment for the Revenue and Net Operating Income Achievement
components begins at 70% achievement, which earns 50% of the Target Award for
this component. If the Net Operating Income Unit does not achieve the minimum
threshold of 50%, then no Award will be deemed earned for the operating unit’s
applicable performance period.

•
For each 1.0% of incremental achievement above the 70% minimum threshold, up to
100%, the Award earned increases by 1.1667% yielding a payout between 50.0% and
85.0%.

•
For each 1.0% of incremental achievement above 100.0%, up to 105.0% the Award
increases by 5.0% yielding a payout from 85.0% to 115.0%.

•
For each 1.0% of incremental achievement above 105.0%, up to 133.0% the Award
increases by 1.25% yielding a payout from 115.0% to 150.0%.

•
The maximum, or cap, is 133.0% Revenue and Net Operating Income, which is
equivalent to 150.0% of the Target Award for each component.

Using the Example, if the first quarter performance is 105% of net revenue and
110% of     net income:

•
105.0%of net revenue target:

115.0% x $2,800 = $3,220.00 net revenue incentive component
•
110.0% of net operating income target:

121.3% x $4,200 = $5,094.60 net operating income incentive component

Total first quarter incentive components = $8,312.50

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Using the Example, if the second quarter performance is 90% of Net Revenue and
80% of Net Operating income:

•
90.0%of net revenue target:

73.3% x $2,800 = $2,053.33 net revenue incentive component

•
80.0% of net operating income target:

61.7% x $4,200 = $2,590 net operating income incentive component

Total second quarter incentive components = $4,643.33

4.
Net Revenue and Net Operating Income will be treated as separate components
independent of one another regardless of the award formula, and will be added to
compute the Award. However, a minimum performance threshold of 70% of the Board
of Directors’ approved AOP for Net Revenue and Net Operating Income must be
achieved for each respective incentive component to be included in the Award.
Likewise, a maximum Award has been established based on performance at 133% of
plan for each component.

 
Note: In no event will a cash award be deemed earned or payable under any
component or provision of the plan if actual Net Operating Income for the
Operating Unit’s applicable performance periods falls below 50% of the approved
AOP for Net Operating Income for such performance period.

5.
A participant’s Award may be adjusted by a Performance Contribution Factor (PCF)
which represents the level of the participant’s contribution to the Company’s
results for the quarter, and the payment made to the participant shall be the
Award multiplied by the PCF. The PCF will be determined by the Company, and can
range from 0.9 to 1.1, as a factor to be multiplied by the Award for the
performance period. A PCF other than 1.0 should be applied on an exception
basis. The PCF for a participant will be based on exceptional performance
(positive or negative) against the objectives set for that participant at the
beginning of the quarter, and the participant’s progress against those
objectives as discussed with his or her manager.

PLAN ADMINISTRATION, INTERPRETATION, AMENDMENT, AND TERMINATION

The Plan will be administered under the direction of the CEO of Emulex
Corporation upon approval by the Emulex Compensation Committee. The
administrator's authority includes recommendations as noted below as well as:

◦
Identification of Plan participants, corporate performance goals, Award
opportunity and Award payment.

◦
Interpretation of the Plan.

◦
Changes to the Plan or termination of the Plan, provided such changes or
termination do not adversely affect the Award opportunity or difficulty of
earning Awards following the beginning of the fiscal year.

◦
Treatment of special events in calculating performance versus plan, such as a
major acquisition or changes in accounting regulations.

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The Company reserves the right in its sole discretion and without advance notice
to amend or terminate the Plan. The terms and provisions of this Plan are not
intended to be a contract and are not contractually enforceable.

ELIGIBILITY THRESHOLDS & PRO-RATION OF AWARD

Except as otherwise provided in this Plan or as required by law, if an employee
is (a) hired by the Company into an eligible incentive position, (b) is promoted
or transferred during the performance period into an eligible position or (c)
demoted or transferred during the performance period out of an Award eligible
position, his/her Award opportunity will be based on the effective date of the
event and prorated accordingly.
New Hires Minimum Participation Requirement – A participant must be an active
regular full-time employee during the performance period for which the Award is
paid. A pro-rated Award payment will be made for employment during portions of a
performance period, provided the participant has been employed for a minimum of
30 calendar days:

Calculation of Prorated Target Award Opportunity – An employee, who is placed
into, moves between Plan eligible positions or removed from a Plan eligible
position during the performance period, is eligible for a prorated Award target.
A proration factor is calculated based upon the number of days divided by the
total number of days in the performance period. (minimum days of service
required for new-hires as stated above). The proration factor will be applied
against the Plan participant’s target Award to calculate the prorated target
Award percentage.
For example: A Plan participant who is promoted into (or out of) a Plan eligible
position on August 16th would be eligible for a prorated payment under the Plan
(assuming a quarterly payout) as follows:
◦
August 16th = 46th day of quarter; full quarter is 91 days therefore proration
factor would be 49.45% (45 days/91 days)

◦
Assuming this Plan participant had a 35% incentive target the prorated target
Award for the quarter would be = 17.31% (35% Target Award x 49.45%)

All quarterly, semi-annual and/or annual Award opportunities under the Plan will
be determined and prorated based on full days, as described above.
Leaves of Absence (LOA) – Except as otherwise provided in this Plan or as
required by law, if a Plan participant goes on an approved Family Medical Leave
Act (FMLA), Workers Compensation or Personal Leave of Absence during the
performance period, the participant’s Target Award Opportunity will be prorated
based upon full number of days worked during the performance period.

◦
A Plan participant who is out of work on an Approved Leave of Absence for any
reason and, as a result, does not work during the performance period will NOT be
eligible for an Award.

◦
Payment for any Award earned up to the start of an applicable Approved Leave of
Absence will be calculated and paid according to the normal process, even if
such payment occurs while a Plan participant is out on an Approved Leave of
Absence. Further, payment for any Award earned during an applicable Approved
Leave of Absence will be calculated according to the normal process, and payment
will be made

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as soon as administratively possible following the Plan participant’s return
from approved leave.
Participant Performance Requirement – Notwithstanding anything to the contrary
in this document, except as otherwise required by law, eligibility to
participate in the Plan or to earn or receive credit for any Award for a given
full-month period during the performance period is contingent on performance by
the Plan participant at a “satisfactory level” for such period, which is defined
as: (i) having no deficiencies in meeting goals or failure to meet job standards
as determined by the Company in its discretion; (ii) effectively performing
his/her duties and responsibilities as generally outlined in the job description
as determined by the Company in its discretion; or (iii) not being subject to a
written Performance Improvement Plan (PIP) or on probation for the period
defined in such PIP or probation.
Separation From Employment – Except as otherwise provided in the Plan, below in
this Section or as required by law, a Plan participant is eligible to receive an
Award if he/she is employed by the Company on the day of actual Award payment
and otherwise meets the Award goal/target, performance, and other eligibility
requirements set forth in this Plan.
◦
In the event a Plan participant is terminated by the Company from his/her
employment for any of the reasons listed below, the Plan participant will be
eligible to receive an Award payment for each applicable performance period
(e.g., for monthly, quarterly and/or annual components). The Award will be based
upon the full number of days the Plan participant worked during the performance
period, regardless of when the Award is paid.

•
Permanent or indefinite reduction in staff resulting in job elimination;

•
Reduction of a Plan participant’s position as the result of an organizational or
business restructuring;

•
Discontinuance of an operation;

•
Relocation of all or a part of Emulex’s business;

•
Lack of work;

•
Location closing;

•
Sale of an operation to a third party; or

•
Sale or other change in ownership of all or a part of Emulex’s business.

◦
In the event a Plan participant is terminated by the Company, resigns or is
otherwise separated from his/her employment for any reason other than those
described above prior to payment of all or a portion of an Award for an
applicable performance period (e.g., for quarterly, semi-annually, and/or
annual), the Plan participant shall immediately cease eligibility as a
participant in the Plan, and shall not be entitled to any Award.

Examples of reasons for termination or separation that disqualify a Plan
participant from receiving an Award include, but are not limited to:

•
Resignation for any reason.

•
Termination by the Company for unsatisfactory job performance, violation of
rules of conduct, disloyalty or breach of fiduciary duty to the Company, or any
other reason not specifically listed above.

◦
In the event of a Plan participant’s death, the Plan participant’s estate will
be eligible to receive an Award payment in whole or prorated for each applicable
performance period (e.g., for quarterly, semi-annually and/or annual) if
decedent was employed by the Company prior to death of such performance period
and otherwise meets the Award goal/target.

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◦
All Awards paid upon separation from employment shall be payable at the same
time and in accordance with this Plan. Exceptions must be approved in writing by
the CEO.

Payment of Awards – Upon approval of an Award in accordance with this Plan, the
Award payment will be distributed no later than the first payroll cycle
following the 60 days after the performance period ends. The Award payment will
be processed after financial close of the performance period, completion of the
audit/review of the Company’s financial statements by the Company’s independent
auditors, and approval by the Emulex Compensation Committee.

DISCRETIONARY CASH PAYMENT

The CEO may recommend a discretionary cash payment to employees who makes an
extraordinary contribution to the success of the Company. Such discretionary
cash payment recommendations are not subject to the guidelines of the Plan
described above, but are subject to the review and prior approval of the
Compensation Committee.

AT-WILL EMPLOYMENT

This document contains guidelines relating to compensation of certain employees
of Emulex. This document is not intended and shall not be read to create any
express or implied promise or contract for employment, for any benefit, or for
specific treatment in specific situations. Unless the employee has an employment
agreement with the Company, the employment relationship with Emulex is at-will,
meaning the employment is not for any minimum or set period, and is subject to
the mutual consent of the employee and Emulex, and either party may terminate
the employment at any time, for any reason, without cause or prior notice.

EQUAL EMPLOYMENT OPPORTUNITY

This Plan will be administered and any Award paid on an equal opportunity basis
without regard to race, religion, sex, age, national origin, physical or mental
disability, marital status, sexual orientation, or any other characteristic that
is protected by applicable law.

DEFINITIONS

Active Regular Full-time Employee: An employee working 40 hours per week.

Gross Base Salary: An employee's base salary, and does not include payment for
overtime, incentive payment of any type, or other income such as relocation
allowances, employee referral payment, etc.

Net Revenue: Net revenue as presented in the Company's consolidated financial
statements.

Net Operating Income: Non-GAAP Operating income as publicly disclosed.

Pre-EICP Operating Income: Non-GAAP Operating income as publicly disclosed,
before reduction for Award expense.

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Target Award Opportunity Categories

Employee Category
Target Award Opportunity Percentage
1
110%
2
70%
3
60%
4
55%
5
50%
6
40%
7
35%
8
20%
9
10%

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