##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 
  þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended December 31, 2006
 OR
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 Commission File No. 001-31353
 EMULEX CORPORATION
 (Exact name of registrant as specified in its charter)
 Delaware
    
    51-0300558(State or other jurisdiction
    
    (I.R.S Employerof incorporation or organization)
    
    Identification No.)3333 Susan StreetCosta Mesa, California
    
    92626(Address of principal executive offices)
    
    (Zip Code)
 (714) 662-5600  Registrants telephone number, including area code
 
 þ o
  þ o o
 o þ




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##### 



PAGEPart I FINANCIAL INFORMATIONItem 1 Financial Statements (unaudited)Condensed Consolidated Balance Sheets
December 31, 2006, and July 2, 2006
    
    
    2Condensed Consolidated Statements of Operations
Three and Six months ended December 31, 2006, and
January 1, 2006
    
    
    3Condensed Consolidated Statements of Cash Flows
Six months ended December 31, 2006, and January 1, 2006
    
    
    4Notes to Condensed Consolidated Financial Statements
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    16Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    30Item 4. Controls and Procedures
    
    
    30Part II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    30Item 1A. Risk Factors
    
    
    31Item 4. Submission of Matters to a Vote of Security Holders
    
    
    43Item 6. Exhibits
    
    
    44Signatures
    
    
    45EXHIBIT 10.3EXHIBIT 10.7EXHIBIT 10.8EXHIBIT 31.AEXHIBIT 31.BEXHIBIT 32
  1




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
  
 
 December 31,
    
    
    July 2,2006
    
    
    2006AssetsCurrent assets:Cash and cash equivalents
    
    $
    114,360
    
    
    $
    224,292Investments
    
    
    142,741
    
    
    
    367,054Accounts and other receivables, net of allowance for doubtful accounts of
$1,903 and $1,908 as of December 31, 2006 and July 2, 2006, respectively
    
    
    64,022
    
    
    
    61,362Inventories, net
    
    
    25,251
    
    
    
    22,414Prepaid expenses and other assets
    
    
    4,614
    
    
    
    4,618Deferred income taxes
    
    
    28,357
    
    
    
    27,814Total current assets
    
    
    379,345
    
    
    
    707,554Property and equipment, net
    
    
    65,657
    
    
    
    66,951Investments
    
    
    12,061
    
    
    
    7,103Goodwill
    
    
    60,604
    
    
    
    Intangible assets, net
    
    
    129,634
    
    
    
    77,765Deferred income taxes
    
    
    
    
    
    
    352Other assets
    
    
    24,961
    
    
    
    432Total assets
    
    $
    672,262
    
    
    $
    860,157Liabilities and Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    26,359
    
    
    $
    17,847Accrued liabilities
    
    
    26,822
    
    
    
    21,910Income taxes payable
    
    
    17,088
    
    
    
    27,630Convertible subordinated notes
    
    
    
    
    
    
    235,177Total current liabilities
    
    
    70,269
    
    
    
    302,564Other liabilities
    
    
    638
    
    
    
    680Deferred income taxes
    
    
    8,068
    
    
    
    Total liabilities
    
    
    78,975
    
    
    
    303,244Commitments and contingencies (note 7)Stockholders equity:Preferred stock, $0.01 par value; 1,000,000 shares authorized (150,000
shares designated as Series A Junior Participating Preferred Stock);
none issued and outstanding
    
    
    
    
    
    
    Common stock, $0.10 par value; 240,000,000 shares authorized; 85,528,860
and 84,455,809 issued and outstanding at December 31, 2006 and July 2,
2006, respectively
    
    
    8,553
    
    
    
    8,446Additional paid-in capital
    
    
    1,011,263
    
    
    
    979,893Accumulated deficit
    
    
    (426,530
    )
    
    
    (431,416
    )Accumulated other comprehensive income (loss)
    
    
    1
    
    
    
    (10
    )Total stockholders equity
    
    
    593,287
    
    
    
    556,913Total liabilities and stockholders equity
    
    $
    672,262
    
    
    $
    860,157
  2




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Three Months Ended
    
    
    Six Months EndedDecember 31,
    
    
    January 1,
    
    
    December 31,
    
    
    January 1,2006
    
    
    2006
    
    
    2006
    
    
    2006Net revenues
    
    $
    121,390
    
    
    $
    110,268
    
    
    $
    223,708
    
    
    $
    214,647Cost of sales
    
    
    55,608
    
    
    
    45,359
    
    
    
    96,727
    
    
    
    87,161Gross profit
    
    
    65,782
    
    
    
    64,909
    
    
    
    126,981
    
    
    
    127,486Operating expenses:Engineering and development
    
    
    29,566
    
    
    
    22,335
    
    
    
    54,877
    
    
    
    44,190Selling and marketing
    
    
    11,944
    
    
    
    9,254
    
    
    
    22,136
    
    
    
    17,211General and administrative
    
    
    7,858
    
    
    
    5,904
    
    
    
    14,018
    
    
    
    11,848Amortization of other intangible assets
    
    
    4,135
    
    
    
    2,726
    
    
    
    6,988
    
    
    
    5,457In-process research and development
    
    
    21,589
    
    
    
    
    
    
    
    20,639
    
    
    
    Total operating expenses
    
    
    75,092
    
    
    
    40,219
    
    
    
    118,658
    
    
    
    78,706Operating (loss) income
    
    
    (9,310
    )
    
    
    24,690
    
    
    
    8,323
    
    
    
    48,780Nonoperating income, net:Interest income
    
    
    5,435
    
    
    
    4,792
    
    
    
    12,873
    
    
    
    8,538Interest expense
    
    
    (520
    )
    
    
    (622
    )
    
    
    (1,144
    )
    
    
    (1,246
    )Other income (expense), net
    
    
    182
    
    
    
    (18
    )
    
    
    995
    
    
    
    (20
    )Total nonoperating income, net
    
    
    5,097
    
    
    
    4,152
    
    
    
    12,724
    
    
    
    7,272(Loss) income before income taxes
    
    
    (4,213
    )
    
    
    28,842
    
    
    
    21,047
    
    
    
    56,052Income tax provision
    
    
    5,863
    
    
    
    11,633
    
    
    
    16,161
    
    
    
    22,407Net (loss) income
    
    $
    (10,076
    )
    
    $
    17,209
    
    
    $
    4,886
    
    
    $
    33,645Net (loss) income per share:Basic
    
    $
    (0.12
    )
    
    $
    0.21
    
    
    $
    0.06
    
    
    $
    0.40Diluted
    
    $
    (0.12
    )
    
    $
    0.19
    
    
    $
    0.06
    
    
    $
    0.38Number of shares used in per share computations:Basic
    
    
    85,215
    
    
    
    83,821
    
    
    
    84,861
    
    
    
    83,609Diluted
    
    
    85,215
    
    
    
    91,266
    
    
    
    91,676
    
    
    
    91,115
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Six Months EndedDecember 31,
    
    
    January 1,2006
    
    
    2006Cash flows from operating activities:Net income
    
    $
    4,886
    
    
    $
    33,645Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization of property and equipment
    
    
    8,801
    
    
    
    8,159Amortization of discount on convertible subordinated notes
    
    
    823
    
    
    
    898Share-based compensation expense
    
    
    13,543
    
    
    
    10,637Amortization of other intangible assets
    
    
    18,205
    
    
    
    12,758In-process research and development
    
    
    20,639
    
    
    
    Gain on disposal of property and equipment
    
    
    25
    
    
    
    62Deferred income taxes
    
    
    1,253
    
    
    
    237Excess tax benefit from share-based compensation
    
    
    (4,066
    )
    
    
    Changes in assets and liabilities:Accounts and other receivables
    
    
    (94
    )
    
    
    (21,076
    )Inventories
    
    
    1,461
    
    
    
    11,857Prepaid expenses and other assets
    
    
    120
    
    
    
    112Accounts payable, accrued liabilities, and other liabilities
    
    
    6,210
    
    
    
    (5,873
    )Income taxes payable
    
    
    (10,542
    )
    
    
    11,184Net cash provided by operating activities
    
    
    61,264
    
    
    
    62,600Cash flows from investing activities:Net proceeds from sale of property and equipment
    
    
    3
    
    
    
    3Additions to property and equipment
    
    
    (5,647
    )
    
    
    (5,834
    )Purchases of investments
    
    
    (1,296,647
    )
    
    
    (1,059,040
    )Maturities of investments
    
    
    1,520,977
    
    
    
    1,013,062Investment in privately-held company
    
    
    (4,975
    )
    
    
    Payments for purchase of Sierra Logic, Inc., net of cash acquired
    
    
    (134,381
    )
    
    
    Restricted cash placed in escrow related to Sierra Logic, Inc. acquisition
    
    
    (24,307
    )
    
    
    Net cash provided by (used in) investing activities
    
    
    55,023
    
    
    
    (51,809
    )Cash flows from financing activities:Retirement of convertible subordinated notes
    
    
    (236,000
    )
    
    
    Retirement of debt assumed in conjunction with Sierra Logic, Inc. acquisition
    
    
    (3,425
    )
    
    
    Proceeds from issuance of common stock under stock plans
    
    
    9,133
    
    
    
    8,609Excess tax benefit from share-based compensation expense
    
    
    4,066
    
    
    
    2,476Net cash (used in) provided by financing activities
    
    
    (226,226
    )
    
    
    11,085Effect of exchange rates on cash and cash equivalents
    
    
    7
    
    
    
    Net (decrease) increase in cash and cash equivalents
    
    
    (109,932
    )
    
    
    21,876Cash and cash equivalents at beginning of period
    
    
    224,292
    
    
    
    120,317Cash and cash equivalents at end of period
    
    $
    114,360
    
    
    $
    142,193Supplemental disclosures:Cash paid during the period for:Interest
    
    $
    301
    
    
    $
    297Income taxes
    
    
    25,667
    
    
    
    8,771Non-cash investing and financing activities:Purchases of property and equipment not paid during the period included in the
accounts payable balance on the Companys condensed consolidated balance sheet
    
    
    806
    
    
    
    
  4




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##### Table of Contents



1.
    
    Basis of Presentation
   Recently Issued Accounting Standards
    2.
    
    Business Combinations
 Sierra Logic, Inc.
  5




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##### Table of Contents



(in thousands)Current and other assets
    
    $
    13,569Property and equipment
    
    
    1,159Acquired IPR&D
    
    
    22,400Intangible assets
    
    
    71,300Goodwill
    
    
    60,727Total assets acquired
    
    
    169,155Current liabilities
    
    
    (10,801
    )Noncurrent deferred tax liability
    
    
    (13,640
    )Total liabilities assumed
    
    
    (24,441
    )Net assets acquired
    
    $
    144,714
     6




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##### Table of Contents



Developed technology
    
    5 yearsCustomer relationships
    
    5 yearsBacklog
    
    3 monthsWeighted-average amortization period
    
    5 years
      7




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Three Months Ended
    
    
    Six Months EndedDecember 31,
    
    
    January 1,
    
    
    December 31,
    
    
    January 1,2006
    
    
    2006
    
    
    2006
    
    
    2006(in thousands, except per share data)Net revenues
    
    $
    121,390
    
    
    $
    117,528
    
    
    $
    231,141
    
    
    $
    225,293Net (loss) income
    
    $
    (10,076
    )
    
    $
    12,827
    
    
    $
    1,384
    
    
    $
    24,467Net (loss) income per
basic share
    
    $
    (0.12
    )
    
    $
    0.15
    
    
    $
    0.02
    
    
    $
    0.29Net (loss) income per
diluted share
    
    $
    (0.12
    )
    
    $
    0.14
    
    
    $
    0.02
    
    
    $
    0.27
 Aarohi Communications, Inc.
    3.
    
    Inventories, net
  December 31,
    
    July 2,2006
    
    2006(in thousands)Raw materials
    
    $
    2,517
    
    
    $
    5,038Finished goods
    
    
    22,734
    
    
    
    17,376$
    25,251
    
    
    $
    22,414
 4.
    
    Goodwill and Intangible assets, net
 Goodwill
 8




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##### Table of Contents



CarryingAmount(in thousands)Goodwill, as
of July 2, 2006
    
    $
    Sierra
Logic, Inc. acquisition goodwill, net
    
    
    60,604Goodwill, as of December 31, 2006
    
    $
    60,604
  December 31,
    
    July 2,2006
    
    2006(in thousands)Intangible assets subject to amortization:Core technology and patents
    
    $
    98,062
    
    
    $
    99,070Accumulated amortization, core technology and patents
    
    
    (60,238
    )
    
    
    (53,440
    )Developed technology
    
    
    83,019
    
    
    
    14,405Accumulated amortization, developed technology
    
    
    (11,283
    )
    
    
    (6,223
    )Customer relationships
    
    
    40,696
    
    
    
    40,264Accumulated amortization, customer relationships
    
    
    (23,697
    )
    
    
    (19,828
    )Tradename
    
    
    4,926
    
    
    
    4,941Accumulated amortization, tradename
    
    
    (2,202
    )
    
    
    (1,856
    )Covenants not-to-compete
    
    
    3,617
    
    
    
    3,064Accumulated amortization, covenants not-to-compete
    
    
    (3,266
    )
    
    
    (2,632
    )Backlog
    
    
    1,300
    
    
    
    Accumulated amortization, backlog
    
    
    (1,300
    )
    
    
    $
    129,634
    
    
    $
    77,765
    2007 (remaining 6 months)
    
    $
    19,8382008
    
    
    36,1652009
    
    
    26,9702010
    
    
    23,6442011
    
    
    18,931Thereafter
    
    
    4,086$
    129,634
 9




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##### Table of Contents



5.
    
    Accrued Liabilities
  December 31,
    
    
    July 2,2006
    
    
    2006(in thousands)Payroll and related costs
    
    $
    10,911
    
    
    $
    8,546Warranty reserves
    
    
    3,855
    
    
    
    2,949Deferred revenue, sales returns and allowances
    
    
    5,904
    
    
    
    4,478Accrued advertising and promotions
    
    
    1,339
    
    
    
    1,463Accrued property, sales, and franchise taxes
    
    
    1,470
    
    
    
    1,336Other
    
    
    3,343
    
    
    
    3,138$
    26,822
    
    
    $
    21,910
  Three Months Ended
    
    Six Months EndedDecember 31,
    
    January 1,
    
    December 31,
    
    January 1,2006
    
    2006
    
    2006
    
    2006(in thousands)
    
    (in thousands)Balance at beginning of period
    
    $
    3,379
    
    
    $
    3,606
    
    
    $
    2,949
    
    
    $
    4,085Accrual for
warranties issued
    
    
    1,114
    
    
    
    553
    
    
    
    2,373
    
    
    
    1,252Changes to
pre-existing warranties (including changes in estimates)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Settlements
made (in cash or in kind)
    
    
    (638
    )
    
    
    (913
    )
    
    
    (1,467
    )
    
    
    (2,091
    )Balance at end of period
    
    $
    3,855
    
    
    $
    3,246
    
    
    $
    3,855
    
    
    $
    3,246
 6.
    
    Convertible Subordinated Notes
    10




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7.
    
    Commitments and Contingencies
 Litigation
     Other Commitments and Contingencies
   11




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8.
    
    Stock-Based Compensation
        12




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Three Months
    
    
    Three MonthsEnded
    
    
    Ended
    
    
    Six Months Ended
    
    
    Six Months EndedDecember 31,
    
    
    January 1,
    
    
    December 31,
    
    
    January 1,2006
    
    
    2006
    
    
    2006
    
    
    2006(in thousands)Total cost of
stock-based payment
plans during the period
    
    $
    7,631
    
    
    $
    5,780
    
    
    $
    13,618

    
    
    $
    10,765Amounts capitalized in
inventory during the
period
    
    
    (210
    )
    
    
    (128
    )
    
    
    (331
    )
    
    
    (282
    )Amounts recognized in
income for amounts
previously
capitalized in inventory
    
    
    121
    
    
    
    154
    
    
    
    256
    
    
    
    154Amounts charged against
income, before income
tax benefit
    
    $
    7,542
    
    
    $
    5,806
    
    
    $
    13,543
    
    
    $
    10,637Amount of related
income tax benefit
recognized in income
    
    $
    2,621
    
    
    $
    1,216
    
    
    $
    3,614
    
    
    $
    2,204
   All Other Plans
    
    Purchase Plan3 Months
    
    6 Months
    
    3 Months
    
    6 MonthsExpected volatility
    
    
    34
    %
    

34%
 38
    %

    
    
    31
    %
    
    
    31
    %Weighted average expected volatility
    
    34%  36
    %
    
    34%  36
    %

    
    
    31
    %
    
    
    31
    %Expected dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Expected term (in years)
    
    2.4  4.4
    
    
    1.4  4.4
    

    
    
    0.5
    
    
    
    0.5Weighted average expected term (in years)
    
    
    3.25
    
    
    
    3.25
    
    
    
    0.50
    
    
    
    0.50Risk-free rate
    
    4.65%  5.10
    %
    
    4.56%-5.10
    %

    
    
    5.01
    %
    
    
    5.01
    %
 13




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WeightedAverage
    
    
    AggregateWeighted
    
    
    Remaining
    
    
    IntrinsicAverage
    
    
    Contractual
    
    
    ValueOptions
    
    
    Exercise Price
    
    
    Term (years)
    
    
    (in millions)Balance, July 2, 2006
    
    
    14,612,882
    
    
    $
    22.06Granted
    
    
    1,292,841
    
    
    
    11.45Exercised
    
    
    962,139
    
    
    
    7.84Canceled
    
    
    682,346
    
    
    
    48.69Forfeited
    
    
    109,840
    
    
    
    16.52Balance, December 31, 2006
    
    
    14,151,398
    
    
    $
    20.82
    
    
    
    5.35
    
    
    $
    44.0Exercisable, December 31, 2006
    
    
    10,294,838
    
    
    $
    22.34
    
    
    
    5.01
    
    
    $
    30.7
  WeightedAverage GrantNumber of
    
    Date FairShares
    
    ValueOutstanding and unvested at July 2, 2006
    
    
    305,000
    
    
    
    17.98Granted
    
    
    1,130,226
    
    
    
    18.27Vested
    
    
    
    
    
    
    Canceled
    
    
    (22,100
    )
    
    
    18.34Outstanding and unvested at December 31, 2006
    
    
    1,413,126
    
    
    
    18.21
     9.
    
    Net Income (Loss) per Share
  14




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Three Months Ended
    
    Six Months EndedDecember 31

    January 1,

    December 31,

    January 1,2006

    2006

    2006
    2006(in thousands except per share data)
    
    (in thousands except per share data)Numerator:Net (loss) income
    
    $
    (10,076
    )
    
    $
    17,209
    
    
    $
    4,886
    
    
    $
    33,645Adjustment for interest expense on convertible
subordinated notes, net of tax
    
    
    
    
    
    
    371
    
    
    
    515
    
    
    
    747Numerator for diluted net (loss) income per share
    
    $
    (10,076
    )
    
    $
    17,580
    
    
    $
    5,401
    
    
    $
    34,392Denominator:Denominator for basic net (loss) income per share
weighted average shares
outstanding
    
    
    85,215
    
    
    
    83,821
    
    
    
    84,861
    
    
    
    83,609Effect of dilutive securities:Dilutive options outstanding and restricted stock
    
    
    
    
    
    
    1,982
    
    
    
    1,762
    
    
    
    2,043Dilutive common shares from assumed conversion
of convertible subordinated
notes
    
    
    
    
    
    
    5,463
    
    
    
    5,053
    
    
    
    5,463Denominator for diluted net (loss) income per
share  adjusted weighted average shares
outstanding
    
    
    85,215
    
    
    
    91,266
    
    
    
    91,676
    
    
    
    91,115Basic net (loss) income per share
    
    $
    (0.12
    )
    
    $
    0.21
    
    
    $
    0.06
    
    
    $
    0.40Diluted net (loss) income per share
    
    $
    (0.12
    )
    
    $
    0.19
    
    
    $
    0.06
    
    
    $
    0.38Antidilutive options excluded from the computations
    
    
    14,151
    
    
    
    8,927
    
    
    
    9,435
    
    
    
    8,695Average market price of common stock
    
    $
    19.85
    
    
    $
    19.54
    
    
    $
    18.01
    
    
    $
    19.71
  15




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations
 Forward-Looking Statements
   16




---



##### Table of Contents



Executive Overview
    www.emulex.com
 Business Combination
  17




---



##### Table of Contents



Convertible Subordinated Notes Offering
    18




---



##### Table of Contents



Results of Operations
  Percentage of Net Revenues

    Percentage of Net RevenuesThree months ended
    
    Six months endedDecember 31,
    
    January 1,
    
    December 31,
    
    January 1,2006
    
    2006
    
    2006
    
    2006Net revenues
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of sales
    
    
    45.8
    
    
    
    41.1
    
    
    
    43.2
    
    
    
    40.6Gross profit
    
    
    54.2
    
    
    
    58.9
    
    
    
    56.8
    
    
    
    59.4Operating expenses:Engineering and development
    
    
    24.4
    
    
    
    20.3
    
    
    
    24.5
    
    
    
    20.6Selling and marketing
    
    
    9.8
    
    
    
    8.4
    
    
    
    9.9
    
    
    
    8.0General and administrative
    
    
    6.5
    
    
    
    5.3
    
    
    
    6.3
    
    
    
    5.6Amortization of other intangible assets
    
    
    3.4
    
    
    
    2.5
    
    
    
    3.1
    
    
    
    2.5In-process research and development
    
    
    17.8
    
    
    
    
    
    
    
    9.3
    
    
    
    Total operating expenses
    
    
    61.9
    
    
    
    36.5
    
    
    
    53.1
    
    
    
    36.7Operating (loss) income
    
    
    (7.7
    )
    
    
    22.4
    
    
    
    3.7
    
    
    
    22.7Nonoperating income, net:Interest income
    
    
    4.5
    
    
    
    4.4
    
    
    
    5.8
    
    
    
    4.0Interest expense
    
    
    (0.4
    )
    
    
    (0.6
    )
    
    
    (0.5
    )
    
    
    (0.6
    )Other income (expense), net
    
    
    0.1
    
    
    
    
    
    
    
    0.4
    
    
    
    Total nonoperating income, net
    
    
    4.2
    
    
    
    3.8
    
    
    
    5.7
    
    
    
    3.4(Loss) income before income taxes
    
    
    (3.5
    )
    
    
    26.2
    
    
    
    9.4
    
    
    
    26.1Income tax provision (benefit)
    
    
    4.8
    
    
    
    10.6
    
    
    
    7.2
    
    
    
    10.4Net (loss) income
    
    
    (8.3
    %)
    
    
    15.6
    %
    
    
    2.2
    %
    
    
    15.7
    %
 Three months ended December 31, 2006, compared to three months ended January 1, 2006
 Net Revenues.
  Net Revenues by Product LineThree Months
    
    
    
    
    
    Three MonthsEnded
    
    Percentage
    
    Ended
    
    PercentageDecember 31,
    
    of Net
    
    January 1,
    
    of Net
    
    Increase/
    
    Percentage(in thousands)
    
    2006
    
    Revenues
    
    2006
    
    Revenues
    
    (Decrease)
    
    ChangeHost Server Products
    
    $
    90,528
    
    
    
    75
    %
    
    $
    94,631
    
    
    
    86
    %
    
    $
    (4,103
    )
    
    
    (4
    %)Embedded Storage Products
    
    
    30,400
    
    
    
    25
    %
    
    
    14,930
    
    
    
    13
    %
    
    
    15,470
    
    
    
    104
    %Intelligent
Network Products
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    462
    
    
    
    
    
    
    
    707
    
    
    
    1
    %
    
    
    (245
    )
    
    
    (35
    %)Total net revenues
    
    $
    121,390
    
    
    
    100
    %
    
    $
    110,268
    
    
    
    100
    %
    
    $
    11,122
    
    
    
    10
    %
  19




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##### Table of Contents



Net Revenues by Major CustomersDirect Revenues
    
    Total Direct and Indirect Revenues (2)Three Months
    
    Three Months
    
    Three Months
    
    Three MonthsEnded
    
    Ended
    
    Ended
    
    EndedDecember 31, 2006
    
    January 1, 2006
    
    December 31, 2006
    
    January 1, 2006Net revenue percentage (1) :OEM:EMC
    
    
    
    
    
    
    
    
    
    
    15
    %
    
    
    24
    %Hewlett-Packard
    
    
    14
    %
    
    
    10
    %
    
    
    14
    %
    
    
    10
    %IBM
    
    
    23
    %
    
    
    32
    %
    
    
    24
    %
    
    
    32
    %Other:Info X
    
    
    13
    %
    
    
    22
    %
    
    
    
    
    
    
    
 
 (1)
    
    Amounts less than 10% are not presented.(2)
    
    Customer-specific models purchased or marketed indirectly through distributors, resellers,
and other third parties are included with the OEMs revenues in these columns rather than as
revenue for the distributors, resellers or other third parties.   Net Revenues by Sales ChannelThree MonthsEnded
    
    Percentage
    
    Three Months Ended
    
    PercentageDecember 31,
    
    of Net
    
    January 1,
    
    of Net
    
    Increase/
    
    Percentage(in thousands)
    
    2006
    
    Revenues
    
    2006
    
    Revenues
    
    (Decrease)
    
    ChangeOEM
    
    $
    90,666
    
    
    
    75
    %
    
    $
    71,611
    
    
    
    65
    %
    
    $
    19,055
    
    
    
    27
    %Distribution
    
    
    30,752
    
    
    
    25
    %
    
    
    38,563
    
    
    
    35
    %
    
    
    (7,811
    )
    
    
    (20
    %)Other
    
    
    (28
    )
    
    
    
    
    
    
    94
    
    
    
    
    
    
    
    (122
    )
    
    
    (130
    %)Total net revenues
    
    $
    121,390
    
    
    
    100
    %
    
    $
    110,268
    
    
    
    100
    %
    
    $
    11,122
    
    
    
    10
    %
  20




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##### Table of Contents



Net Domestic and International RevenuesThree Months
    
    
    
    
    
    Three MonthsEnded
    
    Percentage
    
    Ended
    
    PercentageDecember 31,
    
    of Net
    
    January 1,
    
    of Net
    
    Increase/
    
    Percentage(in thousands)
    
    2006
    
    Revenues
    
    2006
    
    Revenues
    
    (Decrease)
    
    ChangeDomestic
    
    $
    51,061
    
    
    
    42
    %
    
    $
    58,816
    
    
    
    53
    %
    
    $
    (7,755
    )
    
    
    (13
    %)Pacific Rim
    
    
    19,352
    
    
    
    16
    %
    
    
    12,865
    
    
    
    12
    %
    
    
    6,487
    
    
    
    50
    %Europe and rest of
the world
    
    
    50,977
    
    
    
    42
    %
    
    
    38,587
    
    
    
    35
    %
    
    
    12,390
    
    
    
    32
    %Total net revenues
    
    $
    121,390
    
    
    
    100
    %
    
    $
    110,268
    
    
    
    100
    %
    
    $
    11,122
    
    
    
    10
    %
  Gross Profit.
 Engineering and Development.
 Selling and Marketing.
 21




---



##### Table of Contents



General and Administrative.
 Amortization of Intangible Assets.
 In-Process Research and Development.
 Nonoperating
Income, net.
 Income Taxes
 Six months ended December 31, 2006, compared to six months ended January 1, 2006
 Net Revenues.
 22




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##### Table of Contents



Net Revenues by Product LineSix Months
    
    
    
    
    
    Six MonthsEnded
    
    Percentage
    
    Ended
    
    PercentageDecember 31,
    
    of Net
    
    January 1,
    
    of Net
    
    Increase/
    
    Percentage(in thousands)
    
    2006
    
    Revenues
    
    2006
    
    Revenues
    
    (Decrease)
    
    ChangeHost Server Products
    
    $
    176,762
    
    
    
    79
    %
    
    $
    183,393
    
    
    
    85
    %
    
    $
    (6,631
    )
    
    
    (4
    %)Embedded Storage Products
    
    
    46,096
    
    
    
    21
    %
    
    
    29,533
    
    
    
    14
    %
    
    
    16,563
    
    
    
    56
    %Intelligent
Network Products
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    850
    
    
    
    
    
    
    
    1,721
    
    
    
    1
    %
    
    
    (871
    )
    
    
    (51
    %)Total net revenues
    
    $
    223,708
    
    
    
    100
    %
    
    $
    214,647
    
    
    
    100
    %
    
    $
    9,061
    
    
    
    4
    %
     Net Revenues by Major CustomersDirect Revenues
    
    Total Direct and Indirect Revenues (2)Six Months
    
    Six Months
    
    Six Months
    
    Six MonthsEnded
    
    Ended
    
    Ended
    
    EndedDecember 31, 2006
    
    January 1, 2006
    
    December 31, 2006
    
    January 1, 2006Net revenue percentage (1) :OEM:EMC
    
    
    
    
    
    
    
    
    
    
    18
    %
    
    
    25
    %Hewlett-Packard
    
    
    13
    %
    
    
    10
    %
    
    
    13
    %
    
    
    10
    %IBM
    
    
    24
    %
    
    
    29
    %
    
    
    25
    %
    
    
    29
    %Other:Info X
    
    
    17
    %
    
    
    23
    %
    
    
    
    
    
    
    
 
 (1)
    
    Amounts less than 10% are not presented.(2)
    
    Customer-specific models purchased or marketed indirectly through distributors, resellers,
and other third parties are included with the OEMs revenues in these columns rather than as
revenue for the distributors, resellers or other third parties. 23




---



##### Table of Contents



Net Revenues by Sales ChannelSix MonthsEnded
    
    Percentage
    
    Six Months Ended
    
    PercentageDecember 31,
    
    of Net
    
    January 1,
    
    of Net
    
    Increase/
    
    Percentage(in thousands)
    
    2006
    
    Revenues
    
    2006
    
    Revenues
    
    (Decrease)
    
    ChangeOEM
    
    $
    158,243
    
    
    
    71
    %
    
    $
    133,363
    
    
    
    62
    %
    
    $
    24,880
    
    
    
    19
    %Distribution
    
    
    65,362
    
    
    
    29
    %
    
    
    81,181
    
    
    
    38
    %
    
    
    (15,819
    )
    
    
    (19
    %)Other
    
    
    103
    
    
    
    
    
    
    
    103
    
    
    
    
    
    
    
    
    
    
    
    Total net revenues
    
    $
    223,708
    
    
    
    100
    %
    
    $
    214,647
    
    
    
    100
    %
    
    $
    9,061
    
    
    
    4
    %
  Net Domestic and International RevenuesSix Months
    
    
    
    
    
    Six MonthsEnded
    
    Percentage
    
    Ended
    
    PercentageDecember 31,
    
    of Net
    
    January 1,
    
    of Net
    
    Increase/
    
    Percentage(in thousands)
    
    2006
    
    Revenues
    
    2006
    
    Revenues
    
    (Decrease)
    
    ChangeDomestic
    
    $
    104,800
    
    
    
    47
    %
    
    $
    116,143
    
    
    
    54
    %
    
    $
    (11,343
    )
    
    
    (10
    %)Pacific Rim
    
    
    32,592
    
    
    
    14
    %
    
    
    28,957
    
    
    
    14
    %
    
    
    3,635
    
    
    
    13
    %Europe and rest of the world
    
    
    86,316
    
    
    
    39
    %
    
    
    69,547
    
    
    
    32
    %
    
    
    16,769
    
    
    
    24
    %Total net revenues
    
    $
    223,708
    
    
    
    100
    %
    
    $
    214,647
    
    
    
    100
    %
    
    $
    9,061
    
    
    
    4
    %
 24




---



##### Table of Contents



Gross Profit.
 Engineering and Development.
 Selling and Marketing.
 25




---



##### Table of Contents



General and Administrative.
 Amortization of Intangible Assets.
 In-Process Research and Development.
 Nonoperating Income, net.
 Income Taxes
 Critical Accounting Policies
  26




---



##### Table of Contents



Revenue Recognition.
   Warranty.
 Allowance for Doubtful Accounts
 Intangible assets and Other Long-Lived Assets .
 27




---



##### Table of Contents



Inventories .
 Income Taxes
 Stock-Based Compensation
 Goodwill
  28




---



##### Table of Contents



Liquidity and Capital Resources
        Payments Due by Period(in thousands)RemainingTotal
    
    
    2007
    
    
    2008
    
    
    2009
    
    
    2010
    
    
    2011
    
    
    ThereafterLeases
    
    $
    12,602
    
    
    $
    1,646
    
    
    $
    2,656
    
    
    $
    2,509
    
    
    $
    2,417
    
    
    $
    2,436
    
    
    $
    938Inventory purchase commitments
    
    
    41,797
    
    
    
    41,797
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other commitments
    
    
    1,344
    
    
    
    1,344
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    $
    55,743
    
    
    $
    44,787
    
    
    $
    2,656
    
    
    $
    2,509
    
    
    $
    2,417
    
    
    $
    2,436
    
    
    $
    938
 29




---



##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures about Market Risk
 Interest Rate Sensitivity
  
 Item 4. Controls and Procedures
   
 PART II: OTHER INFORMATION
 
 Item 1. Legal Proceedings
 Litigation
   30




---



##### Table of Contents



Item 1A. Risk Factors
  Our acquisition of Aarohi Communications, Inc. on May 1, 2006, as well as our recent acquisition of
Sierra Logic, Inc. on October 2, 2006, involve numerous risks which may have a material adverse
effect on our business and operating results.
  
    
    difficulties and expenses in assimilating and retaining employees, including
integrating teams that have not previously worked together;
    
    difficulties in creating and maintaining uniform standards, controls, procedures, and
policies;
    
    different geographic locations of the principal operations of Emulex, Aarohi and Sierra
Logic and difficulties relating to management of the former Aarohi operations and personnel
in India;
    
    currency conversion exposure for payroll and other expenses of Aarohis principal
product development facility in Bengaluru, India;
    
    difficulties in attaining cost efficiencies in Aarohis product development facility in Bengaluru, India;
    
    potential adverse reactions of existing customers and strategic relationship partners; and
    
    difficulties with integrating acquired technology into our existing technology in a
timely and efficient manner that would allow us to fully realize the benefits of this
acquisition.
  31




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##### Table of Contents



A downturn in information technology spending in general, or spending on computer and storage
systems in particular, could adversely affect our revenues and results of operations.
  A significant portion of our business depends upon the continued growth of the storage networking
market, and our business will be adversely affected if such growth does not occur or occurs more
slowly than we anticipate.
  Because a significant portion of our revenues are generated from sales to a limited number of
customers, none of which are the subject of exclusive or long-term contracts, the loss of one or
more of these customers, or our customers failure to make timely payments to us, could adversely
affect our business.
  32




---



##### Table of Contents



Our markets are highly competitive and our business and results of operations may be adversely
affected by entry of new competitors into the markets, aggressive pricing, and the introduction or
expansion of competitive products and technologies.
   Our operating results are difficult to forecast and could be adversely affected by many factors,
and our stock price may decline if our results fail to meet expectations.
  
    
    changes in the size, mix, timing and terms of OEM and other customer orders;
    
    changes in the sales and deployment cycles for our products and/or desired inventory
levels for our products;
    
    acquisitions or strategic investments by our customers, competitors or the Company;
    
    timing and market acceptance of new or enhanced product introductions by us, our OEM
customers and/or competitors;
 33




---



##### Table of Contents




    
    market share losses or difficulty in gaining incremental market share growth;
    
    fluctuations in product development, procurement, resource utilization and other operating expenses;
    
    component shortages;
    
    reduced demand from our customers if there is a shortage of, or difficulties in
acquiring, components or other products, such as Fibre Channel or SATA disk drives and
optical modules, used in conjunction with our products in the deployment of systems;
    
    inability of our electronics manufacturing service providers to produce and distribute
our products in a timely fashion;
    
    difficulties with updates, changes or additions to our information technology systems;
    
    breaches of our network security, including viruses;
    
    changes in general social and economic conditions, including but not limited to natural
disasters, terrorism, public health and slower than expected market growth, with resulting
changes in customer technology budgeting and spending;
    
    changes in technology, industry standards or consumer preferences;
    
    seasonality; and
    
    changes in our accounting or other policies resulting from the adoption of new laws,
regulations or pronouncements.
  Our relatively small backlog of unfilled orders, possible customer delays or deferrals and our
tendency to generate a large percentage of our quarterly sales near the end of the quarter
contribute to possible fluctuations in our operating results that could have an adverse impact on
our results of operations and stock price.
  Our industry is subject to rapid technological change and we must keep pace with the changes to
successfully compete.
  34




---



##### Table of Contents



We have experienced losses in our history and may experience losses in our future that may
adversely affect our stock price and financial condition.
  The migration of our customers toward newer product platforms may have a significant adverse
effect.
  Any failure of our OEM customers to keep up with rapid technological change and successfully market
and sell systems that incorporate new technologies could adversely affect our business.
  Rapid changes in the evolution of technology, including the unexpected extent or timing of the
transition from HBA solutions or embedded switch box solutions to lower priced ASIC solutions,
could adversely affect our business.
  If customers elect to utilize lower end HBAs in higher end environments or applications, our
business could be negatively affected.
  35




---



##### Table of Contents



Advancement of storage disk capacity technology may not allow for additional revenue growth.
  A decrease in the average unit selling prices and/or an increase in the manufactured cost of our
products could adversely affect our revenue, gross margins and financial performance.
  Delays in product development could adversely affect our business.
  
    
    difficulties in hiring and retaining necessary employees and independent contractors;
    
    difficulties in reallocating engineering resources and other resource limitations;
    
    unanticipated engineering or manufacturing complexity, including from third party
suppliers of intellectual property such as foundries of our ASICs;
    
    undetected errors or failures in software, firmware, and hardware;
    
    changing OEM product specifications;
    
    delays in the acceptance or shipment of products by OEM customers; and
    
    changing market or competitive product requirements.
  Our joint development activities may result in products that are not commercially successful or
that are not available in a timely fashion.
  36




---



##### Table of Contents



® TM
 A change in our business relationships with our third party suppliers or our electronics
manufacturing service providers could adversely affect our business.
  
    
    discontinued production by a supplier;
    
    required long-term purchase commitments;
    
    undetected errors, failures or production quality issues, including projected failures
that may exceed epidemic failure rates specified in agreements with our customers or that
may require us to make concessions or accommodations for continuing customer relationships;
    
    timeliness of product delivery;
    
    sole sourcing and components made by a small number of suppliers, including the
inability to obtain components and finished goods at reasonable cost from such sources and
suppliers;
    
    financial stability and viability of our suppliers and EMS providers;
    
    changes in business strategies of our suppliers and EMS providers;
    
    increases in manufacturing costs due to lower volumes or more complex manufacturing
process than anticipated;
    
    disruption in shipping channels;
    
    natural disasters;
    
    inability or unwillingness of our suppliers or EMS providers to continue their business with us;
    
    environmental, tax or legislative changes in the location where our products are
produced or delivered, including implementation of European Union Directives 2002/95/EC
(RoHS) and 2002/96/EC (WEEE), with the RoHS directive limiting the concentration of certain
materials (lead, chromium, etc.) that may be contained in electronic products placed on the
European market after July 1, 2006, and the WEEE directive requiring certain recycling
markings and recycling procedures for electronic products placed on the European market
after August 13, 2005;
    
    difficulties associated with foreign operations; and
    
    market shortages.
  37




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##### Table of Contents



If our intellectual property protections are inadequate, it could adversely affect our business.
      Third party claims of intellectual property infringement could adversely affect our business.
  38




---



##### Table of Contents



The inability or increased cost of attracting, motivating, or retaining key managerial and
technical personnel could adversely affect our business.
  Our international business activities subject us to risks that could adversely affect our business.
  
    
    imposition of or changes in governmental controls, taxes, tariffs, trade restrictions,
and regulatory requirements;
    
    costs and risks of localizing products for foreign countries;
    
    longer accounts receivable payment cycles;
    
    changes in the value of local currencies relative to our functional currency;
    
    import and export restrictions;
    
    loss of tax benefits, or increases in tax expenses, due to international production;
    
    general economic and social conditions within foreign countries;
    
    taxation in multiple jurisdictions; and
    
    political instability, war or terrorism.
  39




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##### Table of Contents



Potential acquisitions or strategic investments may be more costly or less profitable than
anticipated and may adversely affect the price of our company stock.
  
    
    difficulties in the assimilation of the operations, technologies, products, and
personnel of the acquired company;
    
    purchased technology that is not adopted by customers in the way or the time frame we anticipated;
    
    diversion of managements attention from other business concerns;
    
    risks of entering markets in which we have limited or no prior experience;
    
    risks associated with assuming the legal obligations of the acquired company;
    
    minority interest in a company, resulting from a strategic investment, that could have
an impact on our results;
    
    risks related to the effect that the acquired companys internal control processes
might have on our financial reporting and managements report on our internal controls over
financial reporting;
    
    potential loss of key employees of the company we invested in or acquired;
    
    there may exist unknown defects of an acquired companys products or assets that may
not be identified due to the inherent limitations involved in the due diligence process of
an acquisition; and
    
    changes in generally accepted accounting principles regarding the accounting treatment
for acquisitions to less favorable treatment than is currently allowed.
  Our stock price is volatile, which has and may result in lawsuits against us and our officers and
directors.
  
    
    quarterly variations in customer demand and operating results;
    
    announcements of new products by us or our competitors;
    
    the gain or loss of significant customers or design wins;
    
    changes in analysts earnings estimates;
 40




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##### Table of Contents




    
    changes in analyst recommendations, price targets, or other parameters that may not be
related to earnings estimates;
    
    rumors or dissemination of false information;
    
    pricing pressures;
    
    short selling of our common stock;
    
    general conditions in the computer, storage, or communications markets; and
    
    events affecting other companies that investors deem to be comparable to us.
  Terrorist activities and resulting military and other actions could adversely affect our business.
  Our corporate offices and principal product development facilities are located in regions that are
subject to earthquakes and other natural disasters.
   Our shareholder rights plan, certificate of incorporation and Delaware law could adversely affect
the performance of our stock.
  41




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##### Table of Contents



Our system of internal controls may be inadequate.
  Changes in laws, regulations, and financial accounting standards may affect our reported results of
operations.
  The final determination of our income tax liability may be materially different from our income tax
provisions and accruals.
  We may need additional capital in the future and such additional financing may not be available on
favorable terms.
  
    
    take advantage of unanticipated opportunities, including more rapid international
expansion or acquisitions of complementary businesses or technologies;
    
    develop new products or services;
    
    repay outstanding indebtedness; and
    
    respond to unanticipated competitive pressures.
  42




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##### Table of Contents



Item 4. Submission of Matters to a Vote of Security Holders
  Nominee
    
    In Favor
    
    WithheldFred B. Cox
    
    
    75,944,190
    
    
    
    3,137,057Michael P. Downey
    
    
    74,667,703
    
    
    
    4,413,544Bruce C. Edwards
    
    
    77,423,452
    
    
    
    1,657,795Paul F. Folino
    
    
    75,941,636
    
    
    
    3,139,611Robert H.Goon
    
    
    75,897,241
    
    
    
    3,184,006Don M. Lyle
    
    
    75,654,922
    
    
    
    3,426,325James M. McCluney
    
    
    75,952,110
    
    
    
    3,129,137Dean A Yoost
    
    
    77,611,449
    
    
    
    1,469,798
  For
    
    
    47,572,860Against
    
    
    14,417,270Abstain
    
    
    97,971
  For
    
    
    48,578,332Against
    
    
    13,394,725Abstain
    
    
    115,044
  For
    
    
    78,301,635Against
    
    
    703,615Abstain
    
    
    75,996
 43




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##### Table of Contents



Item 6. Exhibits
 Exhibit 3.1
    
    Certificate of Incorporation, as amended (incorporated by reference to Exhibit 3.1
to the Companys 1997 Annual Report on Form 10-K).Exhibit 3.2
    
    Certificate of Amendment of Certificate of Incorporation of the Company
(incorporated by reference to Exhibit 3.4 to the Companys Quarterly Report on Form 10-Q
for the quarterly period ended December 31, 2000).Exhibit 3.3
    
    Amended and restated Bylaws of the Company (incorporated by reference to Exhibit
3.1 to the Companys Current Report on Form 8-K filed on August 30, 2005).Exhibit 3.4
    
    Certificate of Designations of Series A Junior Participating Preferred Stock
(incorporated by reference to Exhibit 4 to the Companys Current Report on Form 8-K filed
February 2, 1989).Exhibit 4.1
    
    Rights Agreement dated January 19, 1989, as amended (incorporated by reference to
Exhibit 4 to the Companys Current Report on Form 8-K filed February 2, 1989).Exhibit 4.2
    
    Certificate regarding extension of Final Expiration Date of Rights Agreement dated
January 18, 1999 (incorporated by reference to Exhibit 4.2 of Amendment No. 2 to the
Registration Statement on Form S-3, filed on May 17, 1999).Exhibit 10.1
    
    Emulex Corporation 2005 Equity Incentive Plan (incorporated by reference
to Appendix A to the Companys Proxy Statement on Schedule 14A for its 2006 annual
meeting of stockholders filed on October 30, 2006)Exhibit 10.2
    
    Emulex Corporation 1997 Stock Award Plan for Non-Employee Directors (incorporated
by reference to Appendix B to the Companys Proxy Statement on Schedule 14A for its 2006
annual meeting of stockholders filed on October 30, 2006)Exhibit 10.3
    
    Key Employee Retention Agreement for James M. McCluney, as amendedExhibit 10.4
    
    Sierra Logic, Inc. 2001 Stock Option Plan (incorporated by reference to Exhibit
99.1 to the Companys Registration Statement on Form S-8 filed on October 5, 2006)Exhibit 10.5
    
    Form of Sierra Logic, Inc. Stock Option Agreement and Notice of Grant of Stock
Option (incorporated by reference to Exhibit 99.2 to the Companys Registration Statement
on Form S-8 filed on October 5, 2006)Exhibit 10.6
    
    Form of Emulex Corporation Stock Option Assumption Documents for holders of
options granted under the Sierra Logic, Inc. 2001 Stock Option Plan (incorporated by
reference to Exhibit 99.3 to the Companys Registration Statement on Form S-8 filed on
October 5, 2006)Exhibit 10.7
    
    Form of Key Employee Retention Agreement for executive officers of Emulex
Corporation or its subsidiariesExhibit 10.8
    
    Standard Form Business Center Lease dated March 18, 2003,
and its Amendment No. One, Addendum Two, and Addendum Three by and
between Eureka Development Company LLC and Sierra Logic, Inc.Exhibit 31A
    
    Certification of the Principal Executive Officer Pursuant to 17 CFR 240.13a-14(a),
as Adopted Pursuant to § 302 of the Sarbanes-Oxley Act of 2002.Exhibit 31B
    
    Certification of the Principal Financial Officer Pursuant to 17 CFR 240.13a-14(a),
as Adopted Pursuant to § 302 of the Sarbanes-Oxley Act of 2002.Exhibit 32
    
    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to § 906 of
the Sarbanes-Oxley Act of 2002.
 
 *
    
    Indicates a management contract or compensation plan or arrangement. 
 44




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##### Table of Contents



SIGNATURES
   EMULEX CORPORATIONBy:
    /s/ James M. McCluneyJames M. McCluneyChief Executive Officer and PresidentBy:
    /s/ Michael J. RockenbachMichael J. RockenbachExecutive Vice President and Chief Financial

Officer (Principal Financial and Chief Accounting Officer) 45




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##### Table of Contents



Exhibit 3.1
    
    Certificate of Incorporation, as amended (incorporated by reference to Exhibit 3.1 to the Companys 1997 Annual
Report on Form 10-K).Exhibit 3.2
    
    Certificate of Amendment of Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.4
to the Companys Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2000).Exhibit 3.3
    
    Amended and restated Bylaws of the Company (incorporated by reference to Exhibit 3.1 to the Companys Current
Report on Form 8-K filed on August 30, 2005).Exhibit 3.4
    
    Certificate of Designations of Series A Junior Participating Preferred Stock (incorporated by reference to Exhibit
4 to the Companys Current Report on Form 8-K filed February 2, 1989).Exhibit 4.1
    
    Rights Agreement dated January 19, 1989, as amended (incorporated by reference to Exhibit 4 to the Companys
Current Report on Form 8-K filed February 2, 1989).Exhibit 4.2
    
    Certificate regarding extension of Final Expiration Date of Rights Agreement dated January 18, 1999 (incorporated
by reference to Exhibit 4.2 of Amendment No. 2 to the Registration Statement on Form S-3, filed on May 17, 1999).Exhibit 10.1
    
    Emulex Corporation 2005 Equity Incentive Plan (incorporated by reference to Appendix A to the Companys Proxy
Statement on Schedule 14A for its 2006 annual meeting of stockholders filed on October 30, 2006)Exhibit 10.2
    
    Emulex Corporation 1997 Stock Award Plan for Non-Employee Directors (incorporated by reference to Appendix B to
the Companys Proxy Statement on Schedule 14A for its 2006 annual meeting of stockholders filed on October 30,
2006)Exhibit 10.3
    
    Key Employee Retention Agreement for James M. McCluney, as amendedExhibit 10.4
    
    Sierra Logic, Inc. 2001 Stock Option Plan (incorporated by reference to Exhibit 99.1 to the Companys Registration
Statement on Form S-8 filed on October 5, 2006)Exhibit 10.5
    
    Form of Sierra Logic, Inc. Stock Option Agreement and Notice of Grant of Stock Option (incorporated by reference
to Exhibit 99.2 to the Companys Registration Statement on Form S-8 filed on October 5, 2006)Exhibit 10.6
    
    Form of Emulex Corporation Stock Option Assumption Documents for holders of options granted under the Sierra
Logic, Inc. 2001 Stock Option Plan (incorporated by reference to Exhibit 99.3 to the Companys Registration
Statement on Form S-8 filed on October 5, 2006)Exhibit 10.7
    
    Form of Key Employee Retention Agreement for executive officers of Emulex Corporation or its subsidiariesExhibit 10.8
    
    Standard Form Business Center Lease
dated March 18, 2003 and its Amendment No. One, Addendum Two, and
Addendum Three by and between Eureka Development Company LLC and Sierra Logic, Inc.Exhibit 31A
    
    Certification of the Principal Executive Officer Pursuant to 17 CFR 240.13a-14(a), as Adopted Pursuant to § 302 of
the Sarbanes-Oxley Act of 2002.Exhibit 31B
    
    Certification of the Principal Financial Officer Pursuant to 17 CFR 240.13a-14(a), as Adopted Pursuant to § 302 of
the Sarbanes-Oxley Act of 2002.Exhibit 32
    
    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to § 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Indicates a management contract or compensation plan or arrangement. 46