EXHIBIT 10.1

Ixia

2012 Executive Officer Bonus Plan

Ixia (“Ixia” or the “Company”) believes that a portion of each executive
officer’s annual compensation should be “at risk” and directly linked to the
Company’s financial performance, and that with respect to certain of the
Company’s executive officers, a portion of their compensation should be directly
related to such officers’ achievement of individual objectives. The 2012
Executive Officer Bonus Plan (the “2012 Bonus Plan” or the “Plan”) is designed
to motivate Ixia’s executive officers and to reward them for their continuing
contributions to the Company’s business if, in 2012, the Company achieves
certain financial results and/or such officers achieve their individual
objectives. The Company believes that the achievement of these results and
objectives is essential for the Company’s success. The effective date of the
2012 Bonus Plan is May 11, 2012 (the “Effective Date”).

Except as otherwise set forth herein, the Compensation Committee of the
Company’s Board of Directors (the “Committee”) will administer and have final
authority on all matters relating to the Plan. The Committee may interpret and
construe the Plan, decide any and all matters arising under or in connection
with the Plan, and correct any defect, supply any omission, or reconcile any
inconsistency in the Plan. Additionally, the Committee may amend, suspend,
revoke, or terminate the Plan at any time. All bonus payouts under the Plan are
subject to the prior approval of the Committee. All decisions by the Committee
regarding the Plan will be made in the Committee’s sole discretion and will be
final and binding on all persons having or claiming any interest in the Plan.

2012 Bonus Plan Components

Annual Bonus. Each Eligible Officer (as identified by title below), by virtue of
his/her continuing employment with Ixia, will be eligible to receive an annual
bonus (“Annual Bonus”) based on the Company’s financial performance in 2012 as
measured by the degree to which the Company achieves two pre-set financial
targets for 2012 approved by the Committee.

Individual Bonus. Each Eligible Officer (other than the Company’s President and
Chief Executive Officer and the Chief Innovation Officer) will be eligible to
receive an individual bonus (“Individual Bonus”) based on his/her achievement in
2012 of individual business or strategic objectives approved by the Committee
(upon the recommendation of the Company’s Chief Executive Officer).

An Eligible Officer will not be entitled to receive, and the Company will not be
obligated to pay, either an Annual Bonus or an Individual Bonus if the Company’s
2012 Operating Income (as defined herein) is less than the minimum operating
income threshold for 2012. Except as otherwise provided below, the Annual Bonus
and the Individual Bonus payable to an Eligible Officer will be calculated, in
part, as a percentage of such Eligible Officer’s annual base salary of record in
effect at December 31, 2012 (his/her “Annual Base Salary”). In determining an
Eligible Officer’s Annual Base Salary, certain compensation and payments (e.g.,
reimbursement for moving expenses, bonus payments received under this Plan or
otherwise, stock option or other equity incentive compensation, discretionary
bonuses, disability benefits, sign-on bonuses, 401(k) Plan matching
contributions, vacation/PTO cash outs, on call pay, and similar payments) will
be excluded.

If an executive officer commences his/her employment as an Eligible Officer
after January 1, 2012, or if there is a period in 2012 when an executive officer
does not serve as an Eligible Officer, then, for purposes of determining the
amount payable as an Annual Bonus or an Individual Bonus, that

 

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individual’s Annual Base Salary will be prorated based on the ratio of (i) the
number of days that he/she serves as an Eligible Officer during 2012 to
(ii) 365. Notwithstanding the foregoing, an executive officer who commences
his/her employment as an Eligible Officer during the fourth calendar quarter of
2012 will not be eligible to receive either an Annual Bonus or an Individual
Bonus under the Plan. An Eligible Officer who is on an approved leave of absence
from the Company at any time during 2012 will, for purposes of determining
eligibility under the 2012 Bonus Plan, be treated as being employed by the
Company as an Eligible Officer during such leave of absence.

Eligible Officers

The following executive officers have been designated by the Committee as
Eligible Officers for purposes of the 2012 Bonus Plan and will be eligible to
participate in the 2012 Bonus Plan (all titles are positions with Ixia unless
otherwise specified):

Chief Executive Officer and President

Chief Innovation Officer

Chief Financial Officer

Senior Vice President, Corporate Affairs and General Counsel

Senior Vice President, Worldwide Sales

Vice President, Global Customer Delight

Vice President, Human Resources

Vice President, Operations

A person appointed as an executive officer after the Effective Date will be
eligible to participate in the 2012 Bonus Plan if he/she is expressly designated
as an Eligible Officer under the 2012 Bonus Plan pursuant to a duly adopted
resolution by the Committee or the Company’s Board of Directors.

An Eligible Officer whose title changes after the Effective Date will be
entitled to continue to participate in the 2012 Bonus Plan on the same terms and
conditions as applied immediately prior to such title change unless either
(i) the terms of such Eligible Officer’s participation in the 2012 Bonus Plan
are changed pursuant to a duly adopted Committee resolution; or (ii) the
Committee amends the Plan to add the new title as an Eligible Officer in the
Eligible Officer table above, in which case such individual will participate at
the bonus participation level corresponding to his/her new title.

In order to earn and be eligible to receive bonuses payable under the 2012 Bonus
Plan, an Eligible Officer must be employed by Ixia or one of its subsidiaries as
an Eligible Officer on the date on which such bonuses are paid, unless such
requirement is waived by the Committee pursuant to a duly adopted Committee
resolution. An Eligible Officer who is on an approved leave of absence from the
Company on the date on which such bonuses are paid and thereafter returns to
active status as an Eligible Officer upon the end of such leave of absence will
be paid the bonus to which he/she is otherwise entitled within 30 days following
his/her return to active status as an Eligible Officer. An Eligible Officer who
is on an approved leave of absence from the Company on the date on which such
bonuses are paid and thereafter fails to return to active status as an Eligible
Officer upon the end of such leave of absence will not be eligible to receive
any such bonus.

Annual Bonuses

The Company’s consolidated revenues and Operating Income (as defined herein) for
2012 will be the two financial measures used for calculating the amount of
Annual Bonuses payable under the 2012 Bonus Plan. For purposes of the 2012 Bonus
Plan, “Operating Income” means the

 

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Company’s operating income from continuing operations calculated on a
consolidated basis for the year ending December 31, 2012 after any bonuses
payable under the 2012 Bonus Plan and the Company’s 2012 employee bonus plan (as
adjusted to exclude the effects of equity incentive compensation expense,
restructuring charges, officer severance compensation, impairment charges,
acquisition-related amortization and other M&A-related charges or income, and
similar charges or income). If, prior to January 1, 2013, any of the Company’s
existing business units become a discontinued operation or the Company acquires
another company or business (e.g., through a merger or acquisition of stock or
assets), then the consolidated revenue and/or Operating Income targets under the
Plan may be amended by the Committee in its sole discretion.

The amount of an Eligible Officer’s Annual Bonus will be calculated by
multiplying (i) the product of such Eligible Officer’s Annual Base Salary
(prorated, if applicable) and the applicable Annual Bonus Percentage listed
opposite such Eligible Officer’s title in the Bonus Participation Table below by
(ii) the applicable Bonus Factor (as defined herein). The Bonus Factor will be
equal to the average of the Revenue Bonus Factor and the Operating Income Bonus
Factor as determined in accordance with Schedule A. Stated mathematically, the
amount of an Annual Bonus payable to an Eligible Officer equals (AxBxC), where A
= an Eligible Officer’s Annual Base Salary (prorated, if applicable); B = the
applicable Annual Bonus Percentage for such Eligible Officer; and C = the
applicable Bonus Factor.

The amounts of the Company’s 2012 consolidated revenues and Operating Income
will determine the applicable Bonus Factor. As indicated on Schedule A, the
Revenue Bonus Factor will be 0% if the Company’s consolidated revenues are at or
below the minimum revenue target, while revenues exceeding the minimum revenue
target will result in higher Revenue Bonus Factors as set forth in Schedule A,
up to a maximum Revenue Bonus Factor of 180%. As also indicated on Schedule A,
the Operating Income Bonus Factor will be 0% if the Company’s 2012 Operating
Income is at or below the minimum Operating Income target, while higher
Operating Income will result in higher Operating Income Bonus Factors as set
forth in Schedule A, up to a maximum Operating Income Bonus Factor of 180%. The
percentage amount of the Revenue Bonus Factor will be determined by linear
interpolation if the dollar amount of 2012 consolidated revenues falls between
any two of the listed amounts. Similarly, the percentage amount of the Operating
Income Bonus Factor will be determined by linear interpolation if the dollar
amount of 2012 Operating Income falls between any two of the listed amounts.

Except as otherwise provided herein, an Annual Bonus will be payable in one lump
sum (subject to applicable withholding taxes and other deductions) on or before
March 15, 2013, on a date determined by the Compensation Committee in its sole
discretion. In the event the Company’s consolidated financial statements for
2012 are restated, or the Company announces that such statements will be
restated, to reflect a less favorable financial condition or less favorable
results of operations than previously determined and/or reported, the Committee
has the absolute right in its discretion not to pay, to delay the payment of, or
to recover all or a portion of any bonus awarded to any Eligible Officer
pursuant to the terms of the 2012 Bonus Plan.

Individual Bonuses

The percentage degree (0% to 100%) to which an Eligible Officer achieves his/her
objectives for 2012 will be the measure for his/her 2012 Individual Bonus. The
determination of the percentage degree to which an Eligible Officer achieves
his/her objectives will be made by the Committee not later than March 1, 2013.

The amount of a bonus payable as an Individual Bonus will be calculated by
multiplying (i) the product of an Eligible Officer’s Annual Base Salary
(prorated, if applicable) and the Individual

 

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Bonus Percentage listed opposite such Officer’s title in the Bonus Participation
Table below by (ii) the percentage degree to which it is determined that such
Eligible Officer has achieved his/her objectives for 2012.

Except as otherwise provided herein, an Individual Bonus will be payable in one
lump sum (subject to applicable withholding taxes and other deductions) on or
before March 15, 2013, on a date determined by the Compensation Committee in its
sole discretion.

Bonus Participation Levels

For purposes of determining an Eligible Officer’s Annual Bonus or Individual
Bonus under the 2012 Bonus Plan, the 2012 Bonus Opportunity, Annual Bonus
Percentage, and Individual Bonus Percentage for each of the Eligible Officers
identified below will be as follows:

Bonus Participation Table (% of Base Salary)

 

Title    2012 Bonus    
Opportunity        

Annual    

Bonus    
Percentage    

  

Individual    

Bonus    
Percentage    

Chief Executive Officer and President

   100%            100%                0%         

Chief Innovation Officer

   70             70                 0            

Chief Financial Officer

   60             45               15            

Senior Vice President, Corporate Affairs

  and General Counsel

   60             45               15            

Senior Vice President, Worldwide Sales

   60             45               15            

Vice President, Global Customer Delight

   60             45               15            

Vice President, Human Resources

   60             45               15            

Vice President, Operations

   60             45               15            

Additional Bonuses

In addition to bonuses payable under the 2012 Bonus Plan, additional bonuses may
be paid by the Company, but only upon the express approval of the independent
members of the Company’s Board of Directors in their sole discretion.

*    *    *    *

 

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Schedule A

 

2012 Revenue Bonus Factor Matrix

 

     

Revenue  Targets(1)

(in thousands)

  

Revenue

Bonus Factor(1)

Maximum

   (2)    180%      (2)    140   

Target

   (2)    100         (2)    60       (2)    20 

Minimum

   (2)     0

 

 

2012 Operating Income Bonus Factor Matrix

 

     

Operating Income  Targets(1)

(in thousands)

  

Operating Income

Bonus Factor(1)

Maximum

   (2)    180%      (2)    140   

Target

   (2)    100         (2)    60       (2)    20 

Minimum

   (2)     0

 

 

(1) 

For performance between two Revenue or Operating Income Targets, the Revenue
Bonus Factor and the Operating Income Bonus Factor will be interpolated
linearly.

(2) 

The Compensation Committee has supplementally established levels of Revenue and
Operating Income for purposes of this Schedule A.

 

A-1