Exhibit 10.9

ALTERA CORPORATION

NONQUALIFIED DEFERRED COMPENSATION PLAN

(As Amended Effective November 6, 2008)

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TABLE OF CONTENTS

 

     Page(s) ARTICLE I    DEFINITIONS    2 ARTICLE II    PLAN ADMINISTRATION   
5

A.

  

Committee

   5

B.

  

Powers of the Committee

   5

C.

  

Committee Action

   6

D.

  

Committee Duties

   6 ARTICLE III    ELIGIBILITY, PARTICIPATION AND BENEFICIARY DESIGNATION    6

A.

  

Eligible Participants

   6

B.

  

Participation

   6

C.

  

Beneficiary Designation

   6 ARTICLE IV    PLAN CONTRIBUTIONS AND ALLOCATIONS    6

A.

  

Participant Deferrals

   6

B.

  

Change in Election

   7

C.

  

Committee Authority

   7

D.

  

Cessation of Eligible Status

   7

E.

  

Company Matching Contributions

   7

F.

  

Company Discretionary Contributions

   7

G.

  

Allocations

   7 ARTICLE V    VESTING    8

A.

  

Compensation Deferral Contributions

   8

B.

  

Company Contributions

   8 ARTICLE VI    GENERAL DUTIES    8

A.

  

Trustee Duties

   8

B.

  

Participant Contributions

   8

C.

  

Department of Labor Determination

   8 ARTICLE VII    PARTICIPANTS’ ACCOUNTS    9

A.

  

Separate Accounts

   9

B.

  

Statement of Accounts

   9

C.

  

Valuation Dates

   9

 

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TABLE OF CONTENTS

(continued)

 

     Page(s)

D.

  

Investment of Accounts

   9 ARTICLE VIII    PAYMENTS TO A PLAN PARTICIPANT OR BENEFICIARY    9

A.

  

General

   9

B.

  

Cash Distributions

   10

C.

  

In Kind Distributions

   10

D.

  

Method of Payment

   10

E.

  

Certain Distributions

   10

F.

  

IRS Determination

   10

G.

  

Specified Employees

   11 ARTICLE IX    WITHDRAWALS    11

A.

  

Unforeseeable Financial Emergency

   11

B.

  

Domestic Relations Orders

   11 ARTICLE X    CLAIMS PROCEDURE    12

A.

  

Right to File Claim

   12

B.

  

Denial of Claim

   12

C.

  

Claim Review Procedure

   12 ARTICLE XI    MISCELLANEOUS    13

A.

  

Unsecured General Creditor

   13

B.

  

Restriction Against Assignment

   13

C.

  

Withholding

   13

D.

  

Legal Representation

   13

E.

  

Amendment, Modification, Suspension or Termination

   13

F.

  

Governing Law

   14

G.

  

Receipt or Release

   14

H.

  

Payments on Behalf of Persons under Incapacity

   14

I.

  

No Employment Rights

   14

J.

  

Headings Not Part of Agreement

   14

K.

  

Successorship

   14

 

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ALTERA CORPORATION

NONQUALIFIED DEFERRED COMPENSATION PLAN

(As Amended and Restated Effective November 6, 2008)

The Altera Corporation Nonqualified Deferred Compensation Plan, originally
effective as of February 1, 1994, restated effective as of January 1, 1998, and
amended and restated effective as of January 1, 2002, January 1, 2004, and
January 1, 2005, is hereby further amended and restated by Altera Corporation
(the “Company”), effective as of November 6, 2008 on behalf of itself and any
designated subsidiaries.

The terms of this Altera Corporation Nonqualified Deferred Compensation Plan, as
amended and restated on November 6, 2008 (the “Plan”), shall govern all benefits
for which amounts were deferred or earned on or after January 1, 2005. With
respect to Altera Corporation Nonqualified Deferred Compensation benefits that
were deferred compensation to which a participant had a legally binding right
that was not subject to a substantial risk of forfeiture on or before
December 31, 2004, the terms of the Altera Corporation Nonqualified Deferred
Compensation Plan as amended and restated on January 1, 2005 shall apply.

Throughout, the term “Company” shall include, wherever relevant, any entity that
is directly or indirectly controlled by the Company or any entity in which the
Company has a significant equity or investment interest, or any subsidiary of
the Company, as determined by the Company.

RECITALS:

1. The Company maintains the Plan for the benefit of a select group of
management or highly compensated employees designated by the Company.

2. Under the Plan, the Company is obligated to pay vested accrued benefits from
the Company’s general assets.

3. The Company has entered into an agreement (the “Trust Agreement”) with
certain financial institutions (each referred to as “Trustee”) under irrevocable
trusts (each referred to as the “Trust”) to be used in connection with the Plan.

4. The Company intends to make contributions to the Trust so that such
contributions will be held by the Trustee and invested, reinvested and
distributed, all in accordance with the provisions of this Plan and the Trust
Agreement.

5. The Company intends that amounts contributed to the Trust and the earnings
thereon shall be used by the Trustee to satisfy the liabilities of the Company
under the Plan with respect to each Participant for whom an Account has been
established and such utilization shall be in accordance with the procedures set
forth herein.

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6. The Company intends that the assets of the Trust shall at all times be
subject to the claims of the general creditors of the Company as provided in the
Trust Agreement.

7. The Company intends that the Trust be a “grantor trust” with the principal
and income of the Trust treated as assets and income of the Company for federal
and state income tax purposes.

8. The Company intends that the existence of the Trust shall not alter the
characterization of the Plan as “unfunded” for purposes of ERISA (as defined
below), and shall not be construed to provide income to the Plan Beneficiaries
under the Plan prior to actual payment of the vested accrued benefits
thereunder.

NOW THEREFORE, the Company does hereby restate the Plan as follows and does also
hereby agree that the Plan and Trust shall be structured, held and disposed of
as follows:

ARTICLE I

DEFINITIONS

“Account” means an account established on the books of the Company for the
purpose of recording amounts credited on behalf of a Participant and any income,
expenses, gains or losses included thereon.

“Beneficiary” means the person or persons entitled under Article III to receive
benefits under the Plan upon the death of a Participant.

“Change of Control” shall be deemed to have occurred (i) if any person
(including a “Group” as such term is used in Section 13(d)(3) of the Securities
Exchange Act of 1934) acquires (x) shares of the Company having fifty percent
(50%) or more of the total voting power or total fair market value of the stock
of the Company, or (y) assets of the corporation having a total gross fair
market value equal to or more than forty percent (40%) of all of the assets of
the Company immediately before such acquisition or acquisitions or (ii) if a
majority of the members of the Company’s board of directors (“Board”) is
replaced in any 12 month period by directors whose appointment is not endorsed
by a majority of the members of the Company’s Board before the date of the
appointment or election. Provided, however, that as to any Account under this
Plan that is subject to Code Section 409A, no “Change in Control” shall be
deemed to have occurred unless such event constitutes an event specified in Code
Section 409A(a)(2)(A)(v) and the Treasury Regulations and other guidance
thereunder; provided further, that no Change of Control shall be deemed to occur
in the event of a merger, consolidation or reorganization of the Company where
the shareholders of the Company are substantially the same as before such
merger, consolidation or reorganization.

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

“Code Section 409A” means Section 409A of the Code and all applicable
regulations and other guidance issued under or related to Section 409A of the
Code.

“Committee” shall mean the Retirement Plans Committee of the Company.

 

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“Compensation” shall mean cash compensation payable to the Participant in
connection with the Participant’s services to the Company, including all amounts
that a Participant elects to have the Company contribute on his behalf as a
deferral contribution to this Plan.

“Deferred Compensation Agreement” shall mean the written, irrevocable agreement
to be completed by each Eligible Participant before the end of his or her
Election Period in which he or she agrees to participate in the Plan and agrees
to comply with Plan terms, to defer Compensation, and to specify the time and
form of receipt of such payment in order to participate in the Plan.

“Disability” means a disability that entitles a Participant to benefits under
the Company’s long-term disability insurance plan or program, provided that the
Participant also must meet one of the following conditions:

(1) the Participant is unable to engage in any substantial gainful activity by
reason of a medically determinable physical or mental impairment that can be
expected to result in death or which can be expected to last for a continuous
period of not less than 12 months; or

(2) the Participant is, by reason of any medically determinable physical or
mental impairment that can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than three months under an
accident and health plan covering employees of the Participant’s employing
company.

“Distribution Event” means the event or date, selected by the Participant
according to the rules set forth herein, that triggers payment of Participant’s
Account according to Participant’s Method of Payment.

“Eligible Participants” shall mean the following categories of individuals who
provide services to the Company: (i) any Company employee with a job title of
“Director” or higher, and (ii) any other employees who are designated as
eligible to participate by the Committee.

“Election Period” shall be defined as (i) for newly Eligible Participants, the
period of time that is within thirty (30) days from the date that the newly
Eligible Participant is hired or promoted into a “Director” title or above
position, or approved for participation by the Committee; and (ii) for all other
Eligible Participants, no later than the due date for the enrollment forms
during the annual open enrollment period which shall be prior to the beginning
of the calendar year in which the services are to be performed and for which the
election is effective.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended.

“Participant” shall mean any Eligible Participant who has executed a Deferred
Compensation Agreement and who has commenced participation in the Plan.

“Related Employer” means any employer other than the Company named herein, if
the Company and such other employer are members of a controlled group of
corporations (as defined in Section 414(b) of the Code) or an affiliated service
group (as defined in Section 414(m)), or are trades or businesses (whether or
not incorporated) which are under common control (as defined in Section 414(c)),
or such other employer is required to be aggregated with the Company pursuant to
regulations issued under Code Section 414(o).

 

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“Separation from Service” means a termination of services by a Participant with
the Company or his or her Related Employer, whether voluntarily or
involuntarily, as determined in accordance with Treasury Regulation §
1.409A-1(h). In determining whether a Participant has incurred a Separation from
Service, the following provisions shall apply:

(1) Except as otherwise provided in this definition, a Separation from Service
will occur when the Participant has experienced a termination of employment with
the Company or a Related Employer. A Participant will be considered to have
experienced a termination of employment when the facts and circumstances
indicate that the Participant and the Company or his or her Related Employer
reasonably anticipate that either (i) no further services will be performed for
the Company or Related Employer after a certain date, or (ii) that the level of
bona fide services the Participant will perform for the Company or Related
Employer after such date (whether as an employee or as an independent
contractor) will permanently decrease to no more than twenty percent (20%) of
the average level of bona fide services performed by the Participant (whether as
an employee or an independent contractor) over the immediately preceding
36-month period (or the full period of services to the Company or Related
Employer if the Participant has been providing services to the Company or
Related Employer less than 36 months).

If a Participant is on military leave, sick leave, or other bona fide leave of
absence, the employment relationship between the Participant and the Company or
Related Employer will be treated as continuing, provided that the period of the
leave of absence does not exceed 6 months, or if longer, so long as the
Participant has a right to reemployment with the Company or Related Employer
under an applicable statute or by contract. If the period of a military leave,
sick leave, or other bona fide leave of absence exceeds 6 months and the
Participant does not have a right to reemployment under an applicable statute or
by contract, the employment relationship will be considered to be terminated for
purposes of this Plan as of the first day immediately following the end of such
6-month period. In applying the provisions of this paragraph, a leave of absence
will be considered a bona fide leave of absence only if there is a reasonable
expectation that the Participant will return to perform services for the Company
or Related Employer.

(2) For a Participant who provides services to the Company and/or a Related
Employer both as an employee and as an independent contractor, a Separation from
Service generally will not occur until the Participant has ceased providing
services for the Company and Related Employer both as an employee and as an
independent contractor. Except as otherwise provided herein, in the case of an
independent contractor a Separation from Service will occur upon the expiration
of the contract (or in the case of more than one contract, all contracts) under
which services are performed for the Company or Related Employer, provided that
the expiration of such contract or contracts is determined by the Company to
constitute a good-faith and complete termination of the contractual relationship
between the Participant and the Company and Related Employer. If a Participant
ceases providing services for the Company or Related Employer as an employee and
begins providing services for the Company or a Related Employer as an
independent contractor, the Participant will not be considered to have
experienced a Separation from Service until the Participant has ceased providing
services for the Company or Related Employer in both capacities, as determined
in accordance with the applicable provisions set forth in subparagraphs (1) and
(2) of this definition.

 

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Notwithstanding the foregoing provisions in this subparagraph, if a Participant
provides services for an Employer as both an employee and as a member of the
Board of the Company or a Related Employer, to the extent permitted by Treasury
Regulation § 1.409A-1(h)(5), the services provided by the Participant as a
director will not be taken into account in determining whether the Participant
has experienced a Separation from Service as an employee.

(3) In addition, notwithstanding the provisions of this definition, where as
part of a sale or other disposition of substantial assets by the Company or a
Related Employer to an unrelated buyer, a Participant would otherwise experience
a Separation from Service as defined above, the Company and the buyer shall
retain the discretion to specify, and may specify, that a Participant performing
services for the Company or a Related Employer immediately before the asset
purchase transaction and providing services to the buyer after and in connection
with the asset purchase transaction shall not experience a Separation from
Service for purposes of this Plan and the Participant shall be bound by same,
provided that such transaction and the specification meet the requirements of
Code Section 409A.

“Specified Employee” means any Participant who is determined to be a “key
employee” (as defined under Code Section 416(i) without regard to paragraph
(5) thereof) for the applicable period, as determined by the Company in
accordance with Treasury Regulation § 1.409A-1(i).

“Unforeseeable Financial Emergency” means a severe financial hardship to the
Participant resulting from (i) a sudden and unexpected illness or accident of
the Participant, the Participant’s beneficiary, spouse, or the Participant’s
dependent (as defined in Code Section 152 without regard to paragraphs (b)(1),
(b)(2) and (d)(1)(B) thereof), (ii) a loss of the Participant’s property due to
casualty, or (iii) such other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the
Participant, all as determined in the sole discretion of the Committee.

ARTICLE II

PLAN ADMINISTRATION

A. Committee. The Plan shall be administered by the Committee. Subject to the
provisions in the Plan and to the specific duties delegated by the Board to such
Committee, the Committee shall be responsible for the general administration and
interpretation of the Plan and for carrying out its provisions.

B. Powers of the Committee. The Committee shall have such powers as may be
necessary to discharge its duties hereunder, including, but not by way of
limitation, the following powers and duties:

(1) full discretionary authority to construe and interpret the terms of the
Plan, and to determine eligibility and the amount, manner and time of payment of
any benefits hereunder;

 

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(2) to prescribe procedures to be followed by Participants for purposes of Plan
participation and distribution of benefits; and

(3) to take such other action as may be necessary and appropriate for the proper
administration of the Plan.

C. Committee Action. The Committee may adopt such rules, regulations and bylaws
and may make such decisions as it deems necessary or desirable for the proper
administration of the Plan. Any rule or decision shall be conclusive and binding
upon all persons affected by it, and there shall be no appeal from any ruling by
the Committee that is within its authority, except as otherwise provided herein.

D. Committee Duties. The Committee shall provide the Trustee with a copy of any
future amendment to this Plan promptly upon its adoption. The Committee may from
time to time hire outside consultants, accountants, actuaries, legal counsel or
record keepers to perform such tasks as the Committee may from time to time
determine.

ARTICLE III

ELIGIBILITY, PARTICIPATION AND BENEFICIARY DESIGNATION

A. Eligible Participants. The Committee shall determine and reserves the right
to modify the definition of Eligible Participants at any time.

B. Participation. Each Participant must elect to commence participation in the
Plan by completing a Deferred Compensation Agreement no later than the last day
of his or her Election Period.

C. Beneficiary Designation. Each Participant, prior to entering the Plan, shall
designate a Beneficiary to receive the remainder of any interest of the
Participant under the Plan. A Participant may change his or her Beneficiary
designation at any time by written notice. Each Beneficiary designation shall be
in a form prescribed by the Committee and will be effective only when filed with
the appropriate representative of the Human Resources department during the
Participant’s lifetime. Each Beneficiary designation filed with Human Resources
will cancel all previously filed Beneficiary designations. In the absence of a
valid designation, or if no designated Beneficiary survives the Participant, the
Participant’s interest shall be distributed to the Participant’s estate.

ARTICLE IV

PLAN CONTRIBUTIONS AND ALLOCATIONS

A. Participant Deferrals. Each Eligible Participant shall execute a Deferred
Compensation Agreement authorizing the Company to withhold a specific dollar
amount or a percentage of the Participant’s future Compensation that would
otherwise be paid to the Participant with respect to services rendered. The
deferral percentage is applied to Compensation after all other applicable
payroll deductions other than 401(k) contributions have been applied. The
Committee may, in its discretion, establish in the Deferred Compensation
Agreement minimum and maximum levels of

 

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bonus and non- bonus compensation that may be deferred pursuant to the Plan. The
Committee shall have the authority to designate certain types of compensation
(e.g., certain bonuses) as includable or not includable as Compensation for
purposes of deferrals under the Plan. Compensation deferrals made by a
Participant under this Plan shall be held as an asset of the Company.

B. Change in Election. Effective as of January 1, 2009, a Participant may change
the Distribution Event or Method of Payment (i.e., lump sum or installment
payments in accordance with Article VIII.D) in favor of an alternative
Distribution Event or Method of Payment provided that (i) such change shall not
be effective until one (1) year after the date on which the change is made;
(ii) for either type of change, Participant must move his or her Distribution
Event five (5) or more years into the future (other than payments on account of
death, Disability, or Unforeseeable Financial Emergency), and (iii) if the
change modifies an election relating to a payment to be made at a specified time
or pursuant to a fixed payment schedule, the change must be made at least twelve
(12) months before the date of the Distribution Event triggering the first
scheduled payment. Any change in election shall be applicable to the
Participant’s entire account balance.

C. Committee Authority. The Committee has the power to establish rules and from
time to time to modify or change such rules governing the manner and method by
which Compensation deferral contributions shall be made, as well as the manner
and method by which a Compensation deferral contribution may be changed or
discontinued temporarily or permanently. All Compensation deferral contributions
shall be authorized by the Participant in writing, made by payroll deduction and
deducted from the Participant’s Compensation without reduction for any taxes or
withholding (except to the extent required by law or regulation).
Notwithstanding the foregoing, each Participant shall remain liable for any and
all employment taxes owing with respect to such Participant’s Compensation
deferral contributions.

D. Cessation of Eligible Status. In the event a Participant ceases to be an
Eligible Participant while also a Participant in the Plan, such Participant may
continue to make Compensation deferral contributions under the Plan through the
end of the payroll period in which the Participant ceases to be an Eligible
Participant. Thereafter, such Participant shall not make any further
Compensation deferral contributions to the Plan unless or until he or she again
meets the eligibility requirements of Article III above.

E. Company Matching Contributions. On or prior to the last day of each calendar
year or such earlier time or times as the Committee may determine, the Company
may make a matching contribution to the Trust in such amount as the Board shall
specify.

F. Company Discretionary Contributions. The Company may, in its sole discretion,
make discretionary contributions to the Accounts of one or more Participants at
such times and in such amounts as the Board shall determine.

G. Allocations. The Compensation deferral contributions and any Company
contributions made under the Plan on behalf of a Participant shall be credited
to the Participant’s Account. The Committee shall establish and maintain
separate subaccounts as it determines to be necessary and appropriate for the
proper administration of the Plan. Each Participant’s Account consists of the
aggregate interest of the Participant under the Plan (and in the Trust), as
reflected in the records maintained by the Company for such purposes.

 

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ARTICLE V

VESTING

A. Compensation Deferral Contributions. The value of a Participant’s Account
attributable to the Participant’s Compensation deferral contributions shall
always be fully vested and nonforfeitable.

B. Company Contributions. The value of a Participant’s Account attributable to
any Company contributions pursuant to Article IV.E and F shall vest as
determined by the Committee. In the absence of a specific vesting determination,
any such contribution shall vest in its entirety five (5) years from December 31
of the year in which such contributions were made, provided that the Participant
has remained in the continuous service of the Company throughout such period. If
the Participant’s employment with the Company terminates for any reason prior to
the expiration of such period, unless determined otherwise by the Board, no
portion of the Participant’s Account attributable to Company contributions
pursuant to Article IV.E and F occurring within the period shall be considered
vested for purposes of this Plan. Upon a Participant’s Separation from Service
with the Company for any reason, any portion of the Participant’s Account that
is not then vested (including allocable earnings, as determined by the
Committee), shall be forfeited.

ARTICLE VI

GENERAL DUTIES

A. Trustee Duties. The Trustee shall manage, invest and reinvest the Trust Fund
as provided in the Trust Agreement. The Trustee shall collect the income on the
Trust Fund, and make distributions therefrom, as provided in this Plan and in
the Trust Agreement.

B. Participant Contributions. While the Plan remains in effect, and prior to a
Change in Control, contributions to the Trust Fund shall be made on a regular
basis. At the close of each calendar year, the Company shall make an additional
contribution to the Trust Fund to the extent that previous contributions to the
Trust Fund for the current calendar year are not equal to the total of the
Compensation deferrals made by each Participant plus Company matching
contributions and discretionary contributions, if any, accrued as of the close
of the current calendar year. The Trustee shall not be liable for any failure by
the Company to provide contributions sufficient to pay all accrued benefits
under the Plan in full in accordance with the terms of this Plan.

C. Department of Labor Determination. In the event that any Participants are
found to be ineligible, that is, not members of a select group of management or
highly compensated employees, according to a determination made by the
Department of Labor, the Committee shall take whatever steps it deems necessary,
in its sole discretion, to equitably protect the interests of the affected
Participants.

 

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ARTICLE VII

PARTICIPANTS’ ACCOUNTS

A. Separate Accounts. The Committee shall open and maintain a separate Account
for each Participant. Each Participant’s Account shall reflect the amounts
allocated thereto and distributed therefrom and such other information as
affects the value of such Account pursuant to this Plan. The Committee may
maintain records of Accounts to the nearest whole dollar.

B. Statement of Accounts. As soon as practicable after the end of each calendar
year the Committee shall furnish to each Participant a statement of his or her
Account, determined as of the end of such calendar year. Upon the discovery of
any error or miscalculation in an Account, the Committee shall correct it, to
the extent correction is practically feasible; provided, however, that any such
statement of Account shall be considered to reflect accurately the status of the
Participant’s Account for all purposes under the Plan unless, subject to any
longer period required by ERISA, the Participant reports a discrepancy to the
Committee within six (6) months after receipt of the statement. The Committee
shall have no obligation to make adjustments to a Participant’s Account for any
discrepancy reported to the Committee more than six (6) months after receipt of
the statement, or for a discrepancy caused by the Participant’s error.
Statements to Participants are for reporting purposes only, and no allocation,
valuation or statement shall vest any right or title in any part of the Trust
Fund, nor require any segregation of Trust assets, except as is specifically
provided in this Plan.

C. Valuation Dates. The Trust Fund, any separate investment funds, and any
Participant Account shall be valued as of the last day of each calendar year and
as of any other date the Company directs the Trustee to value the Trust Fund.

D. Investment of Accounts. In furtherance of the foregoing, the Committee, in
its sole discretion, may specify the investments that are allowed under the Plan
and adopt (and may modify from time to time) such rules and procedures as it
deems necessary or appropriate to implement the investment of the Participants’
Accounts.

ARTICLE VIII

PAYMENTS TO A PLAN PARTICIPANT OR BENEFICIARY

A. General. Payments of vested accrued benefits to Plan Beneficiaries from the
Trust shall be made in accordance with the Distribution Event and Method of
Payment specified by the Participant in the Deferred Compensation Agreement
between the Company and the Participant. Except as otherwise expressly provided
in the Participant’s Deferred Compensation Agreement and as set forth in Article
IX below, no distribution shall be made or commenced prior to the Participant’s
Distribution Event or a Change of Control, whichever occurs earlier.
Notwithstanding the foregoing, the Committee, in its discretion, may accelerate
payments under this Plan pursuant to and in accordance with the provisions of
Treasury Regulation Section 1.409A-3(j)(4), and, subject to the provisions of
Code Section 409A, upon termination of the Plan. The Trustee shall have no
responsibility to determine whether a Change in Control has occurred and shall
be advised of such event by the Company.

 

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B. Cash Distributions. Where the distribution of all or any portion of a
Participant’s Account is to be distributed in the form of cash, the balance of
his or her Account, if any, shall continue to be held and invested in the Trust
subject to revaluation as provided in the Trust Agreement.

C. In Kind Distributions. In kind distributions shall be (i) made only in the
Committee’s discretion; (ii) made only in a form of investment that was held on
behalf of the Participant as a segregated investment in a separate investment
fund immediately preceding the date of distribution in accordance with the Trust
Agreement; (iii) limited to the amount of such investment so held; and
(iv) based on the fair market value of the distributable property, as determined
by the Trustee at the time of distribution.

D. Method of Payment. Payment to any Plan Participant or Beneficiary shall be
made pursuant to the Deferred Compensation Agreement executed by the
Participant. A Participant may specify in his or her Deferred Compensation
Agreement whether such distribution shall be made:

(1) In a lump sum, in cash and/or, in kind, provided that, any lump sum payments
will be paid on or about the later of (i) April 15 of the year following the
Distribution Event but in no event later than December 31 of such calendar year
or (ii) six months and one day after the Separation from Service (as described
in Article VIII (G) below) ;

(2) In annual installments over a period not to exceed ten (10) years equal to
1/n of the Participant’s vested accrued benefit, where “n” is the number of
installments remaining to be paid, subject to such reasonable procedures and
guidelines as the Committee may establish and beginning on or about April 15 of
the year following the Distribution Event (but in no event later than
December 31 of such calendar year) or such later date if required by Article
VIII (G) below ; or

(3) In annual installments over a period not to exceed ten (10) years, based on
percentages specified by the Participant, subject to an annual minimum
percentage of five percent (5%) and such other limitations as the Committee may
establish and beginning on or about April 15 of the year following the
Distribution Event (but in no event later than December 31 of such calendar
year) or such later date if required by Article VIII (G) below.

E. Certain Distributions. In case of any distribution to a minor or to a legally
incompetent person, the Committee may (1) direct the Trustee to make the
distribution to his or her legal representative, to a designated relative, or
directly to such person for his or her benefit; or (2) instruct the Trustee to
use the distribution directly for his or her support, maintenance, or education.
The Trustee shall not be required to oversee the application, by any third
party, of any distributions made pursuant to this Article.

F. IRS Determination. Notwithstanding any other provisions of this Plan, if any
amounts held in trust under the Plan terms are found in a “determination”
(within the meaning of Section 1313(a) of the Internal Revenue Code of 1986, as
amended (the “Code”)), to have been includible in the gross income of any Plan
Participant or Beneficiary prior to payment of such amounts from the Trust, the
Trustee shall, as soon as practicable pay such amounts to the Plan Participant
or Beneficiary, as directed by the Company. For purposes of this Section, the
Trustee shall be entitled to written notice from the Committee that a
determination described in the preceding sentence has occurred and to receive a
copy of such notice. The Trustee shall have no responsibility until so advised
by the Committee.

 

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G. Specified Employees. Any provision of the Plan to the contrary
notwithstanding, if any payment in respect of a Participant’s Account provides
for a deferral of compensation under Code Section 409A and the Participant is a
Specified Employee as of the date of his or her Separation from Service, no
payment on account of the Participant’s Separation from Service may be made with
respect to such Participant before the date that is six months after the
Participant’s Separation from Service (or, if earlier than the end of the
six-month period, the date of the Participant’s death). In such case, any
payment that would have been made within such six-month period will be
accumulated and paid in a single lump sum on the earliest business day following
the day that is six months after the Participant’s Separation from Service
provided that such date complies with the requirements of Code Section 409A.

ARTICLE IX

WITHDRAWALS

A. Unforeseeable Financial Emergency. At the request of a Participant, the
Committee shall authorize a withdrawal at any time of the accrued benefit
attributable to the Participant’s Compensation deferrals and gains or losses
thereon under the Participant’s Account, provided that authorization for such
withdrawal and the amount thereof shall be given only on account of an
Unforeseeable Financial Emergency. The circumstances that will constitute an
Unforeseeable Financial Emergency will depend upon the facts of each case, but
in any case, payment may not be made to the extent that such hardship is or may
be relieved:

(1) through reimbursement or compensation by insurance or otherwise;

(2) by liquidation of the Participant’s assets, to the extent the liquidation of
such assets would not itself cause severe financial hardship; or

(3) by cessation of deferrals under the Plan.

The Committee shall establish reasonable procedures and guidelines, uniformly
applied, to determine whether an Unforeseeable Financial Emergency exists;
provided, however, that no withdrawal request shall be granted if to do so could
result in the inclusion of Trust Fund amounts in the gross income of Plan
Beneficiaries prior to payment of such amounts from the Trust Fund because
approval of such request would be inconsistent with any applicable statute,
regulation, notice, ruling or other pronouncement of the Internal Revenue
Service interpreting this or similar provisions.

B. Domestic Relations Orders. Subject to the provisions of Code Section 409A,
any claim for benefits under this Plan for child support, spousal maintenance,
alimony, property division or other matrimonial or dependent obligations shall
be paid in a single lump sum payment in cash as soon as administratively
practicable after the Committee (or its delegate) approves such payment. Except
as provided in this section, any such claims under the Plan shall be subject to
the Plan’s claims procedures, provisions, and restrictions.

 

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ARTICLE X

CLAIMS PROCEDURE

A. Right to File Claim. Every Participant or Beneficiary shall be entitled to
file with the Committee a written claim for benefits under the Plan.

B. Denial of Claim. If the claim is denied by the Committee, in whole or in
part, the claimant shall be furnished within ninety (90) days after the
Committee’s receipt of the claim (or within one hundred eighty (180) days after
such receipt if special circumstances require an extension of time) a written
notice of denial of such claim containing the following:

(1) specific reason or reasons for denial;

(2) specific reference to pertinent Plan provisions on which the denial is
based;

(3) a description of any additional material or information necessary for the
claimant to perfect the claim, and an explanation of why the material or
information is necessary; and

(4) an explanation of the claims review procedure.

If written notice of the denial of such claim is not furnished within the time
period prescribed under paragraph (1) above, then the claim shall be deemed
denied.

C. Claim Review Procedure. Review may be requested at any time within sixty
(60) days following the date the claimant received written notice of the denial
of his or her claim. For purposes of this Section, any action required or
authorized to be taken by the claimant may be taken by a representative
authorized in writing by the claimant to act on his or her behalf. The Committee
shall afford the claimant a full and fair review of the decision denying the
claim and, if so requested, shall:

(1) permit the claimant to review any documents that are pertinent to the claim;
and

(2) permit the claimant to submit to the Committee issues and comments in
writing.

The decision on review by the Committee shall be in writing and shall be issued
within sixty (60) days following receipt of the request for review. The period
for decision may, however, be extended up to one hundred twenty (120) days after
such receipt if the Committee determines that special circumstances require
extension. The decision on review shall include specific reasons for the
decision and specific references to the pertinent Plan provisions on which the
decision of the Committee is based.

 

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If the decision on review by the Committee is not furnished within the time
period prescribed under paragraph (2) above, then the claim shall be deemed
denied on review.

ARTICLE XI

MISCELLANEOUS

A. Unsecured General Creditor. Participants and their Beneficiaries, heirs,
successors, and assigns shall have no legal or equitable rights, claims, or
interests in any specific property or assets of the Company. No assets of the
Company shall be held in any way as collateral security for the fulfilling of
the obligations of the Company under this Plan. Any and all of the assets of the
Company shall be, and remain, the general unpledged, unrestricted assets of the
Company. The obligation of the Company under the Plan shall be merely that of an
unfunded and unsecured promise to pay money in the future, and the rights of the
Participants and Beneficiaries shall be no greater than those of unsecured
general creditors.

B. Restriction Against Assignment. The Company shall pay all amounts payable
hereunder only to the person or persons designated by the Plan and not to any
other person or corporation. No part of a Participant’s Account shall be liable
for the debts, contracts, or engagements of any Participant, his or her
Beneficiary, or successors in interest, nor shall a Participant’s Account be
subject to execution by levy, attachment, or garnishment or by any other legal
or equitable proceeding, nor shall any such person have any right to alienate,
anticipate, commute, pledge, encumber, or assign any benefits or payments
hereunder in any manner whatsoever. If any Participant, Beneficiary or successor
in interest is adjudicated bankrupt or purports to anticipate, alienate, sell,
transfer, assign, pledge, encumber or charge any distribution or payment from
the Plan, voluntarily or involuntarily, the Committee, in its sole and absolute
discretion, may cancel such distribution or payment (or any part thereof) to or
for the benefit of such Participant, Beneficiary or successor in interest in
such manner as the Committee shall direct.

C. Withholding. There shall be deducted from each payment made under the Plan,
all taxes that are required to be withheld by the Company, as applicable, in
respect to such payment. The Company shall have the right to reduce any payment
by the amount of cash sufficient to provide the amount of said taxes.

D. Legal Representation. The Company will reimburse all reasonable legal fees
and expenses incurred by a Plan Participant or Beneficiary in seeking to obtain
or enforce any right or benefit provided by the Plan. This reimbursement right
applies only to claims made after a Change of Control and only for fees and
expenses incurred after the Plan Participant or Beneficiary has exhausted the
claims and appeals procedure specified in Article X. No reimbursement shall be
made if the request is found to be frivolous by a court of competent
jurisdiction.

E. Amendment, Modification, Suspension or Termination. The Committee may amend,
modify, suspend or terminate the Plan in whole or in part, except that no
amendment, modification, suspension or termination shall have any retroactive
effect to reduce any amounts allocated to a Participant’s Account, provided that
a termination or suspension of the Plan or any Plan amendment or modification
that will significantly increase costs to the Company shall be approved by the
Board. In the event that this Plan is terminated, the timing of the disposition
of the amounts credited to a Participant’s Account shall occur in accordance
with Article VIII.

 

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F. Governing Law. This Plan shall be construed, governed and administered in
accordance with the internal substantive laws of the State of California (other
than the choice of law principles).

G. Receipt or Release. Any payment to a Plan Participant or Beneficiary in
accordance with the provisions of the Plan shall, to the extent thereof, be in
full satisfaction of all claims against the Committee and the Company. The
Committee may require such Plan Participant or Beneficiary, as a condition
precedent to such payment, to execute a receipt and release to such effect.

H. Payments on Behalf of Persons under Incapacity. In the event that any amount
becomes payable under the Plan to a person who, in the sole judgment of the
Committee, is considered by reason of physical or mental condition to be unable
to give a valid receipt therefore, the Committee may direct that such payment be
made to any person found by the Committee, in its sole judgment, to have assumed
the care of such person. Any payment made pursuant to such determination shall
constitute a full release and discharge of the Committee and the Company.

I. No Employment Rights. Participation in this Plan shall not confer upon any
person any right to be employed by the Company or any other right not expressly
provided hereunder.

J. Headings Not Part of Agreement. Headings and subheadings in this Plan are
inserted for convenience of reference only and are not to be considered in the
construction of the provisions hereof.

K. Successorship. This Plan shall be binding upon and inure to the benefit of
any successor to the Company or its business as the result of merger,
consolidation, reorganization, transfer of assets or otherwise, and any
subsequent successor thereto; and any such successor shall be deemed to be the
“Company” under this Plan. In the event of any such merger, consolidation,
reorganization, transfer of assets or other similar transaction, the successor
to the Company or its business or any subsequent successor thereto shall
promptly notify the Trustee in writing of its successorship and furnish the
Trustee with the name or names of any person or persons authorized to act for
the Company. In no event shall any such transaction described herein suspend or
delay the rights of Plan Beneficiaries to receive their vested accrued benefits
hereunder.

IN WITNESS WHEREOF, the Company has caused this Plan to be executed by its duly
authorized officer as of the day and year first above written.

 

ALTERA CORPORATION By:     Title:     Date:    

 

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