Document:

exv10w1

Exhibit 10.1

AGREEMENT

This Agreement (the “Agreement”) is made by and between David A. Dull (“Employee”) and Broadcom
Corporation, a California corporation (“Company”), effective January 30, 2009.

RECITALS

A. Employee is currently employed by the Company as Senior Advisor and formerly served as Senior
Vice President, Business Affairs, General Counsel and Secretary of the Company.

B. Employee’s position with the Company is being eliminated as part of the Company’s current
restructuring of its business organization and management structure, and the Company desires to
offer Employee a separation package in recognition of the contribution Employee has made to the
Company during his years of service to the Company.

C. Employee understands that the separation package is conditioned upon his compliance with the
terms and provisions of this Agreement, including his delivery to the Company of an effective
general release in the form of Appendix B of certain claims against the Company and its affiliates
and his adherence to the covenants imposed upon him pursuant to the provisions of this Agreement.

AGREEMENT

Based on the foregoing and in consideration of the mutual covenants set forth in this Agreement,
Employee and the Company (for its benefit and the benefit of the other Company Parties as defined
below) hereby agree as follows:

     1. Termination of Employment. Employee’s employment with the Company shall terminate
on February 28, 2009 (the “Termination Date”), and Employee shall thereupon cease to hold the
position of Senior Advisor or any other officer or employee position with the Company. Following
the Termination Date, Employee shall not be required to render any further services to the Company,
whether as an employee, consultant or independent contractor, except for such limited periods of
consulting services (if any), in no event to exceed ten (10) hours per month, as may be agreed upon
by the Company and Employee from time to time hereafter, and Employee shall accordingly incur a
Separation from Service (as defined in Section 6 below) on the Termination Date.

     2. Cessation of Employee Benefits. Except as otherwise required by law or by the
express terms of the plan in which Employee participates, Employee shall cease to be entitled to
any further employee benefits or perquisites from the Company effective as of the Termination Date,
and Employee shall, as of such Termination Date, cease participation in all employee plans of the
Company, including (without limitation): (i) participation in the Company’s 1998 Employee Stock
Purchase Plan, as amended and restated, (ii) eligibility for participant contributions or
Company-matching contributions under the Company’s 401(k) plan and (iii) participation in the
Company’s group health care, life insurance and disability insurance plans, except for any
post-employment coverage under the Company’s group health care plan to which he is entitled
pursuant to his statutory COBRA coverage rights and post-employment coverage

 

 

pursuant to the
applicable portability, conversion, or other post-employment coverage rights under the Company’s
various insurance programs, provided that all such post-employment coverage shall be at Employee’s
expense (except for the Lump Sum Health Care Payment described in Section 5.C of this Agreement).
In addition, Employee shall not accrue any other benefits, including (without limitation) vacation,
flexible spending, leave entitlement, severance or other compensation after the Termination Date.
However, Employee shall be entitled to receive the full value of any benefits accrued under the
Company’s employee benefit plans through the Termination Date and to the additional benefits
provided pursuant to the express terms of this Agreement following the Termination Date.

     3. Return of Company Property. Employee represents and warrants that on or before the
Termination Date, he will deliver to the Company all tangible property of the Company in his
possession, custody or control, including (without limitation) his Company-owned laptop computer
and peripheral devices, his Company-owned cellular phone and personal digital assistant, all
originals and copies of all documents and materials, of whatever nature, relating to the Company,
its products and/or its services, and/or Employee’s employment with the Company, including (without
limitation) all datasheets, files, memoranda, emails, records, software, disks, instructional
manuals and other physical or personal property that Employee received, prepared or helped prepare
in connection with his employment with the Company. Employee further agrees that except for
documents or materials in the public domain, he will not keep any paper or electronic copies or
excerpts of any of the above items and that he has no property or other interest in such documents
and materials.

     The Company agrees to permit Employee and his attorneys to have (a) reasonable access to his
Company email and paper files and (b) electronic and/or paper copies of any personal emails, files,
documents or other information that has been stored on any Company-issued computer, personal
digital assistant or cell phone, including but not limited to addresses, phone numbers, other
contact information, and calendar entries maintained on Employee’s Microsoft Outlook account, and
(c) his own originals and copies of documents related to his employment with the Company. The
Company, at its discretion, may comply with this provision by providing any such access pursuant to
a common interest or confidentiality agreement.

     4. Severance Benefit Requirements. The Company shall make the payments and provide
the benefits described in Subsections 5.A through 5.D below, provided Employee satisfies the
following requirements (the “Severance Benefit Requirements”), to the extent applicable to the
specific payment or benefit provided under Section 5:

     A. Employee delivers to the Company on the Termination Date the general release
and waiver in the form set forth in Appendix B to this Agreement (the “Release”) and
the Release becomes effective in accordance with applicable law following the
expiration of the applicable revocation period under Subsection C of the Release;

     B. Employee complies in all material respects with each of the restrictive
covenants set forth in Sections 7 and 9 of this Agreement (the “Restrictive
Covenants”); and

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     C. Employee complies in all material respects with his affirmative obligations
under Section 10 of this Agreement (the “Section 10 Obligations”).

     5. Severance Benefits. The payments and benefits to which Employee will become
entitled if the applicable Severance Benefits Requirements are satisfied are as follows:

     A. Cash Severance. The Company will pay Employee cash severance (“Cash
Severance”) in an amount equal to his Three Hundred Twenty-Five Thousand Dollar
($325,000.00) current annual rate of base salary. The Cash Severance amount will be paid to
Employee in a lump sum on or before March 17, 2009, provided that the Release becomes
effective in accordance with applicable law following the expiration of the applicable
revocation period under Subsection C of the Release, subject to the Company’s collection of
all applicable withholding taxes. However, the amount of Cash Severance to which Employee
may be entitled pursuant to the foregoing provisions of this Subsection 5.A shall be subject
to the provisions of Section 7 below in the event Employee breaches his Restrictive
Covenants or Section 10 Obligations.

     B. Options and Other Equity Awards. Notwithstanding any less favorable terms
of any stock option or other equity award agreement or plan, any options to purchase shares
of the Company’s Class A common stock or any restricted stock units that the Company has
granted Employee and that are outstanding on the Termination Date shall continue to remain
outstanding even if not vested and exercisable as of the Termination Date and be subject to
the following provisions:

          (i) On the date the Release becomes effective following the expiration of the
revocation period set forth in Subsection C of the Release (the “Release Condition”),
Employee will receive an additional twelve (12) months of service vesting credit under each
of his outstanding stock options and restricted stock unit awards as if he had remained
employed by the Company for the period of twelve (12) months following the Termination Date
(i.e., vesting that would have occurred through February 28, 2010). Any stock option and
restricted stock unit awards that remain unvested after such vesting credit shall be
forfeited on the Termination Date.

          (ii) The limited post-Termination Date exercise period currently in effect for
Employee’s outstanding stock options shall not be subject to the Severance Benefit
Requirements, and those options may during such period be exercised for any or all of the
shares of the Company’s Class A common stock for which those options are vested and
exercisable on the Termination Date without the vesting credit provided under Subsection
5.(B)(i). However, subject to the Release becoming effective, Employee’s continued
compliance with his Restrictive Covenants and Section 10 Obligations, for each outstanding
stock option the post-Termination Date exercise period shall be extended, as to any shares
for which that option is vested at the time after giving effect to the vesting credit
provided under Subsection 5(B)(i), until the earlier of (a) the end of the twelve (12)-month
period measured from the Termination Date or (b) the applicable expiration date of the
maximum ten (10)-year or shorter term (the “New Post-Termination Expiration Date”) of that
respective option. The period between the date that the Employee’s post-Termination Date
exercise period would expire but for this

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Agreement, and the New Post-Termination Expiration
Date is referred to in this Agreement as the “Extended Post-Termination Exercise Period.”
The Extended Post-Termination Exercise Period shall also continue in effect should Employee
die or become permanently disabled (as defined under the Company’s 1998 Stock Incentive
Plan, as amended and restated) on or before the New Post-Termination Expiration Date without
any prior breach of his Restrictive Covenants or Section 10 Obligations.

          (iii) All of the Employee options are non-statutory options under the federal income
tax laws, and the Company shall collect the applicable federal, state and local income and
employment withholding taxes on each exercise of those options.

          (iv) The shares of the Company’s Class A common stock underlying any restricted stock
unit award that vests in accordance with Subsection 5.B(i) shall be issued as soon as
administratively practicable following the date on which the Release becomes effective in
accordance with applicable law following the expiration of the applicable revocation period
under Subsection 11.C, but in no event later than May 5, 2009.

     C. Lump Sum Benefit Payment. Provided Employee and his spouse and eligible
dependents elect to continue medical care coverage under the Company’s group health care
plans pursuant to their COBRA rights, the Company will make a lump sum cash payment (the
“Lump Sum Health Care Payment”) to the Employee in the amount of Three Hundred Fifty
Thousand ($350,000.00) to assist Employee in paying the amounts necessary to obtain COBRA
continuation coverage for himself, his spouse and eligible dependents under the Company’s
employee group health plan for the applicable COBRA coverage period plus an additional
forty-two (42) months of post-COBRA individual medical care coverage for himself and his
spouse and eligible dependents through private insurance coverage procured pursuant to their
HIPPA rights. The Company shall pay the Lump Sum Health Care Payment to Employee, subject to
the Company’s collection of the applicable withholding taxes, concurrently with the payment
of the Cash Severance amount under Subsection 5.A; provided, however, that the Lump Sum
Health Care Payment shall be subject to the provisions of Section 7 below in the event
Employee breaches his Restrictive Covenants or Section 10 Obligations.

     D. 2008 Fiscal Year Bonus Payment. The Company shall pay Employee any cash
bonus for the 2008 fiscal year that was not vested on the Termination Date because the
requirement of continued employment has not been satisfied by Employee, but with respect to
which the applicable performance goal or goals have been fully attained as of the
Termination Date. The Company has determined the amount of such cash bonus to be
$198,656.00 based on (i) the level at which the applicable performance goals for that fiscal
year were attained and (ii) Employee’s status as Senior Vice President for a portion of that
fiscal year and credit at the “appointed officer” level for the balance of such fiscal year.
The bonus amount to which Employee becomes entitled under this Subsection 5.D shall be paid
to Employee on the date the Cash Severance payment is made to him under Subsection 5.A,
subject to the Company’s collection of the applicable withholding taxes.

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     The amounts set forth in Subsections 5.E and 5.F below shall be referred to
collectively as the “Accrued Obligations” and shall not be subject to the satisfaction of
the Severance Benefit Requirements.

     E. Accrued Salary, Expenses and Vacation Pay. On the Termination Date, the
Company shall pay Employee (i) any earned but unpaid base salary through that date that is
not otherwise deferred compensation subject to Subsection 5.F below, (ii) any unreimbursed
business expenses incurred by Employee for which timely documentation has been submitted and
(iii) an amount equal to his accrued but unpaid vacation pay (based on his current rate of
base salary).

     F. Deferred Compensation. Any vested amounts deferred by Employee under one or
more of the Company’s non-qualified deferred compensation programs or arrangements subject
to Section 409A of the Internal Revenue Code of 1986, as amended (“Code”), that remain
unpaid on the Termination Date shall be paid at such time and in such form of payment as set
forth in each applicable plan or agreement governing the payment of those deferred amounts,
subject, however, to the deferred payment provisions of Section 6 below.

     6. Delayed Payment. The following special provisions shall govern the commencement
date of certain payments and benefits to which Employee may become entitled under this Agreement:

     A. Notwithstanding any provision in this Agreement to the contrary, no payment or
benefit under this Agreement that constitutes an item of deferred compensation under Code
Section 409A will be made to Employee prior to the earlier of (i) the first day of the
seventh (7th) month following the date of his Separation from Service or (ii) the date of
his death. Upon the expiration of the applicable deferral period, all payments and benefits
deferred pursuant to this Subsection 6.A (whether they would have otherwise been payable in
a single sum or in installments in the absence of such deferral) shall be paid or provided
to Employee in a lump sum, on the first day of the seventh (7th) month after the date of the
Employee’s Separation from Service or, if earlier, the first day of the month immediately
following the date the Company receives proof of Employee’s death. Any remaining payments
due Employee under this Agreement will be paid in accordance with the normal payment dates
specified herein.

     B. For purposes of this Agreement, “Separation from Service” means the cessation of
Employee’s status as an Employee and shall be deemed to occur at such time as the level of
the bona fide services Employee is to perform in Employee status (or as a consultant or other
independent contractor) permanently decreases to a level that is not more than twenty percent
(20%) of the average level of services Employee rendered in Employee status during the
immediately preceding thirty-six (36) months. Any such determination as to Separation from
Service, however, shall be made in accordance with the applicable standards of the Treasury
Regulations issued under Section 409A. For purposes of determining whether a Separation from
Service has occurred, Employee will be deemed to continue in “Employee” status for so long as
he remains in the employ of one or more members of the Employer Group, subject to the control
and direction of the

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employer entity as to both the work to be performed and the manner and
method of performance. “Employer Group” means the Company and any other corporation or
business controlled by, controlling or under common control with, the Company, as determined
in accordance with Sections 414(b) and (c) of the Code and the Treasury Regulations
thereunder, except that in applying Sections 1563(1), (2) and (3) of the Code for purposes of
determining the controlled group of corporations under Section 414(b), the phrase “at least
50 percent” shall be used instead of “at least 80 percent” each place the latter phrase
appears in such sections, and in applying Section 1.414(c)-2 of the Treasury Regulations for
purposes of determining trades or businesses that are under common control for purposes of
Section 414(c), the phrase “at least 50 percent” shall be used instead of “at least 80
percent” each place the latter phrase appears in Section 1.4.14(c)-2 of the Treasury
Regulations.

     C. In addition, it is the intent of the parties that the provisions of this Agreement
comply with all applicable requirements of Code Section 409A. Accordingly, to the extent
there is any ambiguity as to whether one or more provisions of this Agreement would
otherwise contravene the applicable requirements or limitations of Code Section 409A, then
those provisions shall be interpreted and applied in a manner that does not result in a
violation of the applicable requirements or limitations of Code Section 409A and the
applicable Treasury Regulations thereunder.

     7. Restrictive Covenants. Employee hereby acknowledges that his right and entitlement
to the severance benefit specified in Subsection 5.B(ii) of this Agreement are, in addition to his
satisfaction of the Release Condition, also subject to Employee’s compliance with each of the
following covenants during the twenty-four (24) month period measured from the Termination Date,
and that, subject to the provisions of this Section 7, the particular severance benefit will
immediately cease should Employee materially breach any of those covenants. In addition, Employee
shall cease to be entitled to any amount under Subsections 5.A, 5.B(i) and 5.C that remain unpaid
at the time of such breach:

     A. Employee shall not directly or indirectly encourage or solicit any employee,
consultant or independent contractor to leave the employ or service of the Company (or any
affiliated company) for any reason or materially interfere in any other manner with any
employment or service relationships at the time existing between the Company (or any
affiliated company) and its employees, consultants and independent contractors.

     B. Employee shall not directly or indirectly solicit or otherwise induce any vendor,
supplier, licensor, licensee or other business affiliate of the Company (or any affiliated
company) to terminate its existing business relationship with the Company (or affiliated
company) or materially interfere in any other manner with any existing business relationship
between the Company (or any affiliated company) and any such vendor, supplier, licensor,
licensee or other business affiliate).

     C. Employee shall not disparage the Company or any past or present (as of the time any
statement is made) officer, director or employee of the Company or otherwise make statements
 — whether or not such statements are thought to be (or are) true, and whether or not such
statements are made publicly, privately, subject to

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confidentiality obligations or otherwise
 — which could tend to harm or injure the personal or business reputation or business, of the
Company or of any past or present officer, director or employee of the Company, and whether
or not such statements are made to any present or former employee or director of the Company
or to someone outside of the Company; provided, however, that such covenant shall not apply
to any litigation between the parties or arising out of this Agreement or to any
information, statement, or testimony Employee provides in connection with any action, suit
or proceeding, whether civil, criminal, administrative, or investigative, concerning matters
related to Employee’s employment with the Company.

     D. Employee shall not materially breach any of his obligations under Section 9 of this
Agreement.

     E. Employee shall not materially breach any of his obligations under Section 10 of this
Agreement.

     Should the Company’s Board of Directors (the “Board”) determine that Employee has breached any
of the restrictive covenants set forth in this Section 7 or his covenants under Section 9 or
Section 10, below after providing Employee with written notice describing the specific covenant
that has been breached, and a reasonable opportunity to cure such breach (to the extent such breach
is susceptible of cure), then Employee shall immediately cease to be entitled to any amounts under
Subsections 5.A, 5.B(i) or 5.C that remain unpaid at the time of the Board’s determination. In
addition, any of the Employee’s outstanding stock options that are at the time of such
determination exercisable only by virtue of the existence of the extended Post-Termination Exercise
Period shall immediately terminate and cease to be outstanding or exercisable. The Company shall
also be entitled to recover at law any monetary damages for any additional economic loss caused by
Employee’s breach and may, to the maximum extent allowable under applicable law, seek equitable
relief in the form of an injunction precluding Employee from continuing such breach.

     Employee acknowledges that this Agreement is entirely voluntary, and that he has signed this
Agreement of his own volition. Employee understands that the benefits described at Subsections 5.A,
5.B(i) and 5.C and the Extended Post-Termination Exercise Period for stock options described in
Subsection 5.B(ii), are provided as an advance that is subject to compliance with the requirements
of Sections 7, 9 and 10. As a condition of this Agreement, and for all purposes of this Agreement,
Employee specifically agrees that in the event that the Board determines that Employee has breached
any of the covenants of Sections 7, 9 or 10, after providing Employee with written notice
describing the specific covenant that has been breached, and a reasonable opportunity to cure such
breach (to the extent such breach is susceptible of cure), payment of any amounts otherwise payable
under Subsections 5.A, 5.B(i) and 5.C shall cease, and stock options that are at the time of such
determination exercisable only by virtue of the existence of the extended Post-Termination Exercise
Period shall immediately terminate and cease to be outstanding or exercisable.

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     8. Repayment of Options and Restricted Stock Units.

     A. In the event that there is a nonappealable final order or determination in any
judicial or administrative proceeding that Employee engaged in any Misconduct (as defined
below) relating to any stock options or other forms of equity compensation awards granted by
the Company, whether granted to Employee or to any other individual (the “Repayment Trigger
Event”), then the Board of Directors of the Company may determine, in its reasonable
discretion, that:

          (i) any stock options outstanding at the time of such final determination that are
exercisable only by virtue of the existence of the extended Post-Termination Exercise
Period, and any stock options that have become vested on account of the provisions of
Subsection 5.B(i) shall terminate and cease to be outstanding and exercisable; and

          (ii) the Company shall rescind (a) each exercise of any stock options during the
Extended Post-Termination Exercise Period and (b) each exercise, whenever effected, of any
stock options that have become vested on account of the provisions of Subsection 5.B(i), and
(c) the vesting of the restricted stock units pursuant to Subsection 5.B(i), provided that
the rescission shall be effective only if the Company notifies the Employee of the
rescission no later than sixty (60) days after the final determination that the Employee
engaged in such Misconduct. In the event of any such rescission, the Employee shall pay to
the Company the amount of any gain realized upon the exercise of the rescinded option
(determined as of the time of exercise) or the vesting rescission of the vesting of the
restricted stock units pursuant to Subsection 5.B(i) (with such gain to be determined at the
time of such rescission or, if the shares subject to those restricted stock units have been
sold, then at the time of such sale), in such manner and on such terms and conditions as may
be required by the Company, provided that the Company shall be entitled to set-off against
the amount of any such gain any amount owed to the Employee by the Company. Employee shall
retain the benefit of tax withholdings made by the Company in connection with any option
exercise or issuance of shares that is later rescinded pursuant to this Section 8, provided
that the amount repaid to the Company pursuant to this Section is the pre-tax gain or
amount.

     B. The Board of Directors of the Company may reduce the amount to be recouped under the
foregoing provisions of this Section 8 based on such factors as the Board determines to be
relevant.

     C. For purposes of this Section 8, the term “Misconduct” means (a) any act or omission
by Employee that constitutes fraud upon the Company under federal or state law; or (b)
conduct that constitutes a breach of Employee’s fiduciary duty to the Company under
applicable federal or state law.

     D. For purposes of this Section 8, the term “nonappealable final order or
determination” means a final judicial or administrative order or determination from which
there is no right of appeal and excludes, without limitation, any settlement, consent

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decree, or administrative order to which Employee consents and in which there is no
admission of liability or guilt.

     E. Employee acknowledges that this Agreement is entirely voluntary, and that he has
signed this Agreement of his own volition. Employee understands that any amounts paid to
Employee upon the exercise of any stock options that are exercised during the Extended
Post-Termination Exercise Period, or upon the exercise at any time of any stock options that
have become vested on account of the provisions of Subsection 5.B(i) or upon the vesting of
his restricted stock units pursuant to Section 5.B(i) are provided as an advance that is
subject to the provisions and conditions of this Section 8. As a condition of this
Agreement, and for all purposes of this Agreement, Employee specifically agrees that should
a Repayment Trigger Event occur, the Board of Directors of the Company may cancel, rescind,
suspend, withhold or otherwise limit or restrict the stock options that have been extended
beyond the limited post-Termination Date exercise period in effect for those options prior
to the Termination Date, or that have become vested on account of the provisions of Section
5B(i) or the restricted stock units (or underlying shares) that vested pursuant to
Subsection 5.B(i). In the event that amounts have been paid to Employee pursuant to the
exercise of such stock options or the vesting of such restricted stock units and the Board
of Directors of the Company determines that Employee must repay an amount to the Company as
a result of the Company’s cancellation, rescission, suspension, withholding or other
limitation or restriction of rights pursuant to this Section 8.E, Employee agrees, as a
condition of being awarded such rights, to make such repayments.

     9. Confidentiality Agreement and Disclosure by Company.

     A. Employee agrees to continue to abide by the terms and provisions of the
Confidentiality and Invention Assignment Agreement with the Company dated March 27, 1998
(the “Confidentiality Agreement”), a copy of which is attached as Appendix A to this
Agreement, that survive the termination of Employee’s employment with the Company. Nothing
in this Agreement shall affect the scope, enforceability, term or any other provision of the
Confidentiality Agreement, except that the provisions of Sections 7.A and 7.B shall
supersede any comparable or conflicting provision in the Confidentiality Agreement.

     B. The Company and Employee agree that the Company may disclose the existence, terms or
provisions of, or any other information concerning, this Agreement to the extent the Company
determines in its sole judgment that disclosure is required by law or is or otherwise
appropriate.

     10. Cooperation in Pending Matters. Except for any disputes that arise between
Employee and any Company Party (as defined in Subsection A of the Release ), Employee shall provide
reasonable cooperation with the Company in connection with any currently pending or future or
potential litigation matter or governmental investigation to which the Company is subject and which
arises out of acts or omissions that occurred on or before the Termination Date, including (without
limitation) providing information within Employee’s knowledge to the Company and by making himself
reasonably available to testify in any action as reasonably

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requested by the Company. Without
limiting the generality of the foregoing covenant, Employee’s obligation to cooperate with the
Company shall extend to the Company’s defense in (A) the ongoing federal and state “options
derivative actions” and “options class actions”, each as detailed in the Company’s quarterly report
on Form 10-Q filed with the Securities and Exchange Commission on October 22, 2008 and (B) any
similar actions that have been filed or may be filed in the future (collectively, the matters in
(A) and (B) are referred to herein as the “Options Cases”).

     The Company agrees that Employee’s exercise of his Constitutional rights in connection with
any currently pending or future or potential litigation matter or governmental investigation shall
not constitute lack of cooperation under this Section 10. Employee may also comply with this
Section 10 by providing any requested information pursuant to a common interest agreement.

     11. No Admissions. It is understood and agreed to by the Parties that nothing
contained in this Agreement shall be construed as evidence or an admission of any alleged
wrongdoing or liability by any Party to this Agreement.

     12. Withholding Taxes. The Company shall withhold from all amounts payable to
Employee under this Agreement all Federal, state, local or foreign taxes required to be withheld
pursuant to any applicable law or regulation, and Employee shall only receive the net amount
remaining after such taxes have been withheld.

     13.  Mandatory Arbitration. ANY AND ALL DISPUTES OR CONTROVERSIES BETWEEN THE
COMPANY AND EMPLOYEE ARISING OUT OF, RELATING TO OR OTHERWISE CONNECTED WITH THIS AGREEMENT OR THE
BENEFITS PROVIDED HEREUNDER OR THE VALIDITY, CONSTRUCTION, PERFORMANCE OR TERMINATION OF THIS
AGREEMENT OR RELATING TO EMPLOYEE’S EMPLOYMENT WITH THE COMPANY OR THE TERMINATION OF HIS
EMPLOYMENT SHALL BE SETTLED EXCLUSIVELY BY BINDING ARBITRATION UNDER THE AUSPICES OF THE JUDICIAL
ARBITRATION AND MEDIATION SERVICES (JAMS) TO BE HELD IN ORANGE COUNTY, CALIFORNIA. THE ARBITRATION
PROCEEDINGS SHALL BE GOVERNED BY (i) THE THEN MOST APPLICABLE RULES OF JAMS AND (ii) THE FEDERAL
ARBITRATION ACT. ANY DEMAND FOR ARBITRATION BY EITHER PARTY MUST BE FILED WITHIN THE STATUTE OF
LIMITATIONS THAT IS APPLICABLE TO THE CLAIMS RELATING TO THE DISPUTE UPON WHICH ARBITRATION IS
SOUGHT. THE ARBITRATOR SHALL HAVE THE SAME, BUT NO GREATER, REMEDIAL AUTHORITY AS WOULD A COURT
HEARING THE SAME DISPUTE. THE DECISION OF THE ARBITRATOR SHALL BE FINAL, CONCLUSIVE AND BINDING ON
THE PARTIES TO THE ARBITRATION AND SHALL BE IN LIEU OF THE RIGHTS THOSE PARTIES MAY OTHERWISE HAVE
TO A JURY TRIAL; PROVIDED, HOWEVER, THAT SUCH DECISION SHALL BE SUBJECT TO CORRECTION, CONFIRMATION
OR VACATION IN ACCORDANCE WITH THE PROVISIONS AND STANDARDS OF APPLICABLE LAW GOVERNING THE
JUDICIAL REVIEW OF ARBITRATION AWARDS. WITH RESPECT TO ANY DISPUTE FOR BREACH OF THIS AGREEMENT OR
REGARDING THE VALIDITY, CONSTRUCTION, PERFORMANCE OR TERMINATION OF THIS AGREEMENT, THE PREVAILING
PARTY IN SUCH

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ARBITRATION, AS DETERMINED BY THE ARBITRATOR, AND IN ANY ENFORCEMENT OR OTHER COURT
PROCEEDINGS, SHALL BE ENTITLED, TO THE EXTENT PERMITTED BY LAW, TO REIMBURSEMENT FROM THE OTHER
PARTY FOR ALL OF THE PREVAILING PARTY’S COSTS, INCLUDING (WITHOUT LIMITATION) EXPENSES AND
REASONABLE ATTORNEY’S FEES. HOWEVER, THE ARBITRATOR’S COMPENSATION AND OTHER FEES AND COSTS UNIQUE
TO ARBITRATION SHALL IN ALL EVENTS BE PAID BY THE COMPANY. JUDGMENT SHALL BE ENTERED ON THE
ARBITRATOR’S DECISION IN ANY COURT HAVING JURISDICTION OVER THE SUBJECT MATTER OF SUCH DISPUTE OR
CONTROVERSY. NOTWITHSTANDING THE FOREGOING, EITHER PARTY MAY IN AN APPROPRIATE MATTER APPLY
TO A COURT PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 1281.8, OR ANY COMPARABLE
STATUTORY PROVISION OR COMMON LAW PRINCIPLE, FOR PROVISIONAL RELIEF, INCLUDING A TEMPORARY
RESTRAINING ORDER OR A PRELIMINARY INJUNCTION. TO THE EXTENT PERMITTED BY LAW, THE PROCEEDINGS AND
RESULTS, INCLUDING THE ARBITRATOR’S DECISION, SHALL BE KEPT CONFIDENTIAL.

     14. Severability. If any provision of this Agreement as applied to any party or to
any circumstance should be adjudged by a court of competent jurisdiction or determined by an
arbitrator to be void or unenforceable for any reason, the invalidity of that provision shall in no
way affect (to the maximum extent permissible by law) the application of such provision under
circumstances different from those adjudicated by the court or determined by the arbitrator, the
application of any other provision of this Agreement or the enforceability or invalidity of this
Agreement as a whole. Should any provision of this Agreement become or be deemed invalid, illegal
or unenforceable in any jurisdiction by reason of the scope, extent or duration of its coverage,
then such provision shall be deemed amended to the extent necessary to conform to applicable law so
as to be valid and enforceable or, if such provision cannot be so amended without materially
altering the intention of the parties, then such provision will be stricken, and the remainder of
this Agreement, as the case may be, shall continue in full force and effect.

     15. Miscellaneous Provisions.

          A. Additional Documents. The parties will execute all such further and additional
documents and undertake all such other actions as shall be reasonable, convenient, necessary or
desirable to carry out the provisions of this Agreement.

          B. Notices. Written notices required or permitted to be given pursuant to this
Agreement shall be given as follows:

               If to Employee: At the most recent address of Employee as shown on the Company’s payroll
records.

	 	 	 
	 

	 	If to the Company:
	 
	 	 
	 

	 	Broadcom Corporation

5300 California Avenue

Irvine, CA 92617

11

 

	 	 	 
	 

	 	Attn: General Counsel

Facsimile No.: (949) 926-9244

               Such notice shall be deemed to have been duly given: (i) when delivered by hand, if personally
delivered; (ii) three business days after being deposited in the U.S. Mail, postage prepaid, if
mailed certified mail, return receipt requested; (iii) one business day after being timely
delivered to a nationally-recognized next-day air courier guaranteeing overnight delivery; (iv) the
date of transmission if sent via confirmed facsimile transmission to the facsimile number as set
forth in this Subsection 15.B or the signature page hereof prior to 6:00 p.m. in the recipient’s
time zone on a business day, or (v) the business day next following the date of transmission if
sent via confirmed facsimile transmission to a facsimile number set forth in this Subsection 15.B
or on the signature page hereof after 6:00 p.m. in the recipient’s time zone or on a date that is
not a business day. Change of a party’s address or facsimile number may be designated hereunder by
giving notice to all of the other parties hereto in accordance with this Subsection 15.B.

          C. Integration. This Agreement constitutes a single, integrated written contract
expressing the entire Agreement of the parties concerning the subject matter referred to in this
Agreement. No covenants, agreements, representations, or warranties of any kind whatsoever,
whether express or implied in law or fact, have been made by any party to this Agreement, except as
specifically set forth in this Agreement. All prior and contemporaneous discussions, negotiations,
and agreements have been and are merged and integrated into, and are superseded by, this Agreement;
provided, however, that the Confidentiality Agreement (as modified by the provisions of this
Agreement) and the Indemnification Agreement (as defined in Appendix B) and all agreements
evidencing the Employee’s outstanding stock options, restricted stock units or other equity awards
from the Company shall remain in full force and effect in accordance with their respective terms.

          D. Modifications. No modification, amendment, or waiver of any of the provisions
contained in this Agreement, or any future representation, promise, or condition in connection with
the subject matter of this Agreement, shall be binding upon any party to this Agreement unless made
in writing and signed by each of Employee and the Company.

          E. Non-Reliance on Other Parties. Except for statements expressly set forth in this
Agreement, no party has made any statement or representation to any other party regarding a fact
relied on by the other party in entering into this Agreement, and no party has relied on any
statement, representation, or promise of any other party, or of any representative or attorney for
any other party, in executing this Agreement or in making the settlement provided for in this
Agreement.

          F. Construction. Whenever the context so requires, the singular number shall include
the plural number and vice versa, and the masculine gender shall include the feminine (or neuter)
gender and vice versa.

          G. Headings. The descriptive headings and sub-headings of the several section(s)
contained in this Agreement are inserted for convenience only and shall not control or affect the
meaning or construction of any of the provisions hereof.

12

 

          H. Successors and Assigns. This Agreement shall inure to the benefit of and shall be
binding upon the Employee and the personal representatives of his estate and the successors and
assigns of the Company. In the case of the Company, this Agreement is intended to release and
inure to the benefit of any affiliated corporations, parent corporations, brother-sister
corporations, subsidiaries (whether or not wholly owned), divisions, shareholders, officers,
directors, agents, representatives, principals, employees, and any and all other related
individuals and entities.

          I. Applicable Law. This Agreement shall be construed in accordance with, and governed
by, the laws of the State of California without taking into account conflict of law principles.

          J. Counterparts. This Agreement maybe executed and delivered in any number of
counterparts or copies (“Counterparts”) by the parties to this Agreement. When each party has
signed and delivered at least one Counterpart to the other party to this Agreement, each
Counterpart shall be deemed an original and, taken together, shall constitute one and the same
Agreement, which shall be binding and effective as to the parties to this Agreement. Such delivery
may be made by confirmed facsimile transmission.

          K. Independent Advice from Counsel. Employee has received prior independent legal
advice from legal counsel of his choice with respect to the advisability of making the settlement
provided for in this Agreement and with respect to the advisability of executing this Agreement.
Employee has also obtained his own legal counsel with respect to the tax implications of the
payments and benefits to be provided to him under this Agreement, including (without limitation)
the applicability of Code Section 409A to such payments and benefits, and Employee shall be solely
responsible for the payment of any federal, state, local or foreign taxes that he may incur, in
excess of the amounts withheld pursuant to Section 13, as a result of those payments and benefits.

          L. Knowing and Voluntary Agreement. Each party acknowledges that he or it is entering
into this Agreement knowingly and voluntarily after having had an opportunity to negotiate with
regard to the terms of this Agreement, to receive advice with regard to it, to carefully read and
consider its terms, and to make such investigation of the facts pertaining to the settlement and
this Agreement and of all matters pertaining to this Agreement as such party deems necessary or
desirable.

Remainder of Page Intentionally Left Blank

13

 

     IN WITNESS WHEREOF, the parties hereto and their respective attorneys of record have approved
and executed this Agreement on the dates specified below.

	 	 	 	 	 	 	 
	 	 	THE COMPANY:	 	 
	 
	 	 	 	 	 	 
	 	 	BROADCOM CORPORATION,	 	 
	 	 	a California corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Scott A. McGregor	 	 
	 

	 	 	 	Scott A. McGregor	 	 
	 

	 	 	 	President and Chief Executive Officer	 	 

	 	 	 	 	 
	 

	 	Dated:
	 	January 30, 2009
	 
	 	 	 	 
	 	 	EMPLOYEE:
	 
	 	 	 	 
	 	 	/s/ David A. Dull
	 	 	                David A. Dull
	 
	 	 	 	 
	 

	 	Dated:
	 	January 30, 2009

Broadcom Corporation agrees to furnish supplementally a copy of any of the appendices to the SEC
upon request.

14

 

RELEASE AND WAIVER (“Release”)

          A. Release of Company Parties. Except for the obligations of Broadcom Corporation, a
California Corporation (“Company”), expressly set forth in the agreement entered into between the
Company and David A. Dull (“Employee”) effective January 30, 2009 (“Agreement”), the
Indemnification Agreement (as hereinafter defined), and all agreements evidencing the Employee’s
outstanding stock options, restricted stock units or other equity awards from the Company (to the
extent that those stock options, restricted stock units or equity awards remain outstanding
pursuant to the terms of the Agreement), Employee does hereby, on behalf of himself and his
successors, heirs, assigns, related individuals and entities (if any), fully and forever release
and discharge the Company and any of its parent corporations, subsidiaries (whether or not
wholly-owned), brother-sister corporations, and all other affiliated, related, predecessor or
successor corporations and entities, and each of their respective present and former officers,
directors, employees, representatives, administrators, accountants, attorneys, investigators,
partners, associates, successors and assigns, in any and all capacities (including but not limited
to the fiduciary, representative or individual capacity of any released person or entity), and any
entity owned by or affiliated with any of the foregoing (each a “Company Party” and together, the
“Company Parties”) from, and covenants not to sue or otherwise institute or cause to be instituted
any legal or administrative proceedings against the Company or the Company Parties with respect
to, any matter arising out of or relating to Employee’s employment with Company or the termination
of such employment or any acts of the Company or any Company Party, including (without limitation)
any claims and causes of action against the Company or any Company Party that relate to conduct
relating to Employee’s employment occurring before and up to the date of the Release. Moreover,
Employee releases, acquits and discharges the Company and the Company Parties from any and all
rights, actions, claims, demands, costs and expenses (including, without limitation, attorneys
fees), contracts, allegations, liabilities, obligations, debts, damages and causes of action,
whether known, suspected or unknown, fixed or contingent, apparent or concealed, which Employee
had or now has or may claim to have had by reason of any matter or thing at any time up to and
including the date Employee executes the Release. The foregoing notwithstanding, this Release
shall not extend to existing or future claims for indemnification permitted under statutory or
common law, the Company’s Bylaws or Articles of Incorporation or the Indemnification Agreement
dated March 27, 1998 between Employee and the Company (the “Indemnification Agreement”), provided,
however, that Employee shall notify the Company in writing within the requisite time period (as
set forth in the Indemnification Agreement) after receipt of notice of any claim subject to such
indemnification. Employee hereby acknowledges the Company’s rights pursuant to the Company’s
Bylaws and Section 317 of the California Corporations Code (set forth in the letter agreement
between the Company and Employee dated November 19, 2006) under certain circumstances to seek
repayment of any advance payments that have been or may be made in connection with any pending or
future litigation. In addition, this Release shall not extend to any existing or future claim for
contribution or indemnity that Employee may have against any Company Party (excluding the
Company), in any civil action or proceeding brought against Employee, including but not limited to
the options related matters described in the Company’s quarterly report on Form 10-Q filed with
the Securities and Exchange Commission on October 22, 2008. Employee further acknowledges that
this Release does not impair or affect any claims that have been or may be asserted by the Company
or on

 

 

the Company’s behalf against Employee, either through the Special Litigation Committee of the
Board of Directors or otherwise (including, but not limited to, claims for breach of fiduciary
duty, contribution, and violations of any state statutes or federal statutes, rules or
regulations).

          B. Acknowledgement and Waiver. Employee understands and agrees that, except for
obligations and claims excluded from the release set forth in Subsection A above, and with respect
to any claims arising out of the Agreement or arising out of acts or omissions that occur after the
Termination Date (as defined in the Agreement), he is waiving any rights he may have had, now has,
or in the future may have, to pursue any and all remedies available to him individually or on
behalf of others to those claims released pursuant to Subsection A above, including but not limited
to any claims based on, arising out of, or related to Employee’s employment with, the Company or
the termination of that employment, including (without limitation) any claims arising from rights
under federal, state and local laws relating to the regulation of federal or state tax payments or
accounting; federal, state or local laws that prohibit harassment or discrimination on the basis of
race, national origin, religion, sex, gender, age, marital status, bankruptcy status, disability,
perceived disability, ancestry, sexual orientation, family and medical leave, or any other form of
harassment or discrimination or related cause of action (including, without limitation, the failure
to maintain an environment free from harassment and retaliation); laws such as workers’
compensation laws, which provide rights and remedies for injuries sustained in the workplace;
statutory or common law claims of any kind, including but not limited to, contract, tort, and
property rights, unfair business practices, breach of contract, breach of implied-in-fact contract,
breach of the implied covenant of good faith and fair dealing, tortious interference with contract
or current or prospective economic advantage, fraud, deceit, invasion of privacy, unfair
competition, misrepresentation, defamation, wrongful termination, tortious infliction of emotional
distress (whether intentional or negligent), breach of fiduciary duty, violation of public policy,
or any other common law claim of any kind whatsoever; any claims (other than with respect to the
Company’s express obligations under this Agreement) for severance pay, sick leave, family leave,
liability pay, overtime pay, vacation, life insurance, health insurance, continuation of health
benefits, disability or medical insurance or any other fringe benefit or compensation, including
stock options, restricted stock units and other equity awards; any and all rights or claims arising
under Title VII of the 1964 Civil Rights Act, as amended, the California Fair Employment and
Housing Act, and any other state or federal statutes relating to securities, discrimination or
wrongful termination of employment or employment related claims, the Equal Pay Act of 1963, the
Americans with Disabilities Act, California Labor Code Section 1197.5, the Age Discrimination in
Employment Act of 1967, as amended, the Civil Rights Act of 1866, the California Business and
Professions Code Section 17200 et seq., the Employee Retirement Income Security Act of 1976, as
amended (“ERISA”), and any other laws and regulations relating to employment or the Employee’s
receipt of wages, stock, stock options, restricted stock units, other equity awards or other
compensation or benefits. Employee represents and warrants that as of the date this Release is
executed by him, he has not suffered any work related injuries or illnesses.

          C. ADEA Waiver. Employee expressly acknowledges and agrees that by executing this
Release, he is waiving any and all rights or claims that he may have arising under the Age
Discrimination Employment Act of 1967, as amended (“ADEA”), which have arisen on or before the date
of execution of this Release. Employee further expressly acknowledges that in return and agrees
that: (i) in return for this Release and the consideration provided under the

2

 

Agreement, he will receive consideration beyond that which he was already entitled to receive
before entering into this Release and the Agreement; (ii) he is hereby advised in writing by this
Release to consult with an attorney before signing this Release; (iii) he was given a copy of this
Release and the Agreement on January 30, 2009 and informed that he had twenty-one (21) days within
which to consider the Release and that if he wished to execute this Release prior to expiration of
such twenty-one (21)-day period, he should execute the Acknowledgement and Waiver attached to as
the Agreement as Appendix C; (iv) nothing in this Agreement prevents or precludes Employee
from challenging or seeking a determination in good faith of the validity of this waiver under the
ADEA, nor does it impose any condition precedent, penalties or costs from doing so, unless
specifically authorized by federal law; and (v) he was informed that he has seven (7) days
following the date of execution of this Release in which to revoke this Release, and this Release
will become null and void if Employee elects revocation during that time. Any revocation must be
in writing and must be received by the Company during the seven (7)-day revocation period. In the
event Employee exercises his right of revocation, neither the Company nor Employee will have any
obligations under the Agreement.

          D. General Release. In furtherance of Employee’s intention, and except for obligations
and claims excluded from the release set forth in Subsection A above, Employee waives any and all
rights or benefits which he or it may have under the provisions of California Civil Code Section
1542, which provides as follows:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR [EMPLOYEE]
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY
AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR [COMPANY].”

          E. Mistakes in Fact/Voluntary Consent. Employee expressly and knowingly acknowledges
that, after the execution of this Release, he may discover facts different from or in addition to
those that he now knows or believes to be true with respect to the claims released in this
Release. Nonetheless, Employee agrees that this Release shall be and remain in full force and
effect in all respects, notwithstanding such different or additional facts. It is the intention of
Employee to fully, finally, and forever settle and release any and all claims he may have against
the Company and the Company Parties. In furtherance of such intention, the Release given shall be
and remain in effect as a full and complete release of such claims, notwithstanding the discovery
and existence of any additional or different claims or facts. This Release is intended to be final
and binding between and among the parties to the Agreement, regardless of any allegations of
misrepresentations, or promises made without the intention of performance, or concealments of
facts, or mistake of fact or law, or of any other circumstances whatsoever.

          F. Non-Assignment and Absence of Claims. Employee hereby represents and warrants that
he has not assigned or transferred any portion of any claim that he has or may have to any other
person, firm, corporation or any other entity, and that no other person, firm, corporation, or
other entity has any lien or interest in any such claim. Employee represents that except for
claims under the Indemnification Agreement, he has not filed any claims, charges,

3

 

complaints or actions against the Company or any Company Parties, or assigned to anyone any
charges, complaints, claims or actions against the Company or any Company Parties. Employee also
agrees that if any claim is prosecuted in his name against the Company or any Company Party, except
for any claims excluded from the release set forth in Subsection A above, before any court or
administrative agency that he waives and agrees not to take any award or other damages from such
suit. This provision, however, shall apply only to the extent permissible under applicable law.

     IN WITNESS WHEREOF, Employee has executed this Release on the date specified below.

	 	 	 	 	 
	 

	 	/s/ David A. Dull
	 	 
	 

	 	David A. Dull	 	 
	 
	 	 	 	 
	 

	 	Dated: February 28, 2009	 	 

4

 

 ACKNOWLEDGMENT AND WAIVER

     I, David A. Dull, do hereby acknowledge that I was given twenty-one (21) days to consider the
foregoing Release and voluntarily chose to sign such Agreement prior to the expiration of that
21-day period.

     I declare under penalty of perjury under the laws of the State of California that the
foregoing is true and correct.

     EXECUTED this 28th day of February 2009, at Orange County, California.

	 	 	 	 	 
	 

	 	/s/ David A. Dull
 

           David A. Dull
	 	 

5exv10w2

Exhibit 10.2

BROADCOM CORPORATION

PERFORMANCE BONUS PLAN

(as amended and restated March 11, 2009)

     I. PURPOSES OF THE PLAN

          A. The Broadcom Corporation Performance Bonus Plan (the “Plan”) is intended to promote the
interests of Broadcom Corporation (the “Company”) and its shareholders by establishing a
compensation program to provide key employees with incentive awards tied to the achievement of
goals relating to the performance of the Company and/or the achievement of individual performance
goals.

          B. The Plan shall be in effect for the year ending December 31, 2007 and for each of the next
four (4) years through the year ending December 31, 2011. Each year for which the Plan is in
effect shall be designated a “Plan Year,” and bonuses may be earned under the Plan on the basis of
the Company’s performance for each Plan Year.

     II. PLAN ADMINISTRATION

          A. The Plan shall be administered by the Compensation Committee of the Company’s Board of
Directors. The Compensation Committee in its capacity as administrator of the Plan (the “Plan
Administrator”) shall have full power and authority (subject to the express provisions of the Plan)
to:

          (i) establish the specific performance objectives that must be attained for each Plan
Year at one or more designated levels (e.g. threshold, above-threshold, target and
above-target);

          (ii) establish the maximum bonus pool to be paid in total under the Plan for each Plan
Year.

          (iii) set the bonus potential for each eligible participant at each designated level of
performance; and

          (iv) approve the actual bonus (if any) to be paid to each participant.

          B. The Plan Administrator shall also have full power and authority to interpret and construe
the provisions of the Plan and adopt rules and regulations for the administration of the Plan.

          C. Decisions of the Plan Administrator shall be final and binding upon all parties who may
have an interest in the Plan or any bonus amount payable under the Plan.

 

 

     III. ELIGIBILITY AND PARTICIPATION

          A. The individuals eligible to participate in the Plan shall be limited to (i) all employees
of the Company (or its subsidiaries) at the level of Director or above and (ii) any other employees
of the Company (or its subsidiaries) identified by management as key contributors to the Company’s
growth and financial success and selected for participation in the Plan, subject to the approval
the Company’s Chief Executive Officer and the Plan Administrator. All Section 16 Officers shall be
eligible to participate in this Plan for the 2008 Plan Year and for each subsequent Plan Year
thereafter. However, if a Section 16 Officer is selected for participation in the Executive
Officer Bonus Plan for any given Plan Year, then that Section 16 officer shall not be eligible to
participate in this Plan for that same Plan Year.

          B. An individual selected for participation in the Plan shall cease to be a participant and
shall not be entitled to any bonus payment under the Plan for a given Plan Year if that participant
ceases Employee status for any reason prior to the date that bonuses for that Plan Year are paid
under the Plan (the “Distribution Date”); provided, however, that the following participants may,
in the Plan Administrator’s sole discretion, receive all or a portion of the bonus to which they
would otherwise be entitled pursuant to the provisions of Articles IV and V below for that Plan
Year had they continued in Employee status through such Distribution Date:

          (i) any participant who ceases Employee status prior to the Distribution Date by reason
of death or Disability; provided, however, that such individual shall at a minimum be paid
on the Distribution Date a pro-rated portion of the individual bonus he or she would have
otherwise become entitled pursuant to Articles IV and V on the basis of the bonus pool
established in accordance herewith for the Plan Year within the Plan Period in which such
death or Disability occurs, with such pro-ration to be in accordance with such individual’s
period of active service within such Plan Period; and

          (ii) any participant whose Employee status terminates under special circumstances that
warrant, in the Plan Administrator’s sole discretion, a full or pro-rated bonus award under
the Plan for the applicable Plan Period.

               In addition, a full or pro-rated bonus shall be paid to any participant whose Employee status
terminates under circumstances that entitle that individual to such a full or pro-rata bonus for
the applicable Plan Period pursuant to the express terms of any agreement or arrangement to which
that individual and the Company are parties.

          C. For purposes of this Article III, the following definitions shall be in effect:

          (i) A participant shall be deemed to continue in “Employee” status for so long as that
individual remains in the employ of the Company or any subsidiary of the Company.

2

 

          (ii) A participant shall be deemed to have ceased Employee status by reason of a
“Disability” if such cessation of Employee status is occasioned by his or her inability to
engage in any substantial gainful activity by reason of any medically determinable physical
or mental impairment which is expected to result in death or has lasted or can be expected
to last for a continuous period of twelve (12) months or longer.

          (iii) The “Plan Period” shall mean the period beginning with the first day of the Plan
Year and ending with the Distribution Date for the bonuses payable with respect to that
Plan Year.

          (iv) A “Section 16 Officer” shall mean any executive officer of the Company who is
subject to the short-swing profit liability provisions of Section 16 of the Securities
Exchange Act of 1934, as amended.

          (v) Each corporation (other than the Company) in an unbroken chain of corporations
beginning with the Company shall be considered to be a “subsidiary” of the Company, provided
that each such corporation (other than the last corporation in the unbroken chain) owns, at
the time of determination, stock possessing more than fifty percent (50%) of the total
combined voting power of all classes of stock in one of the other corporations in such
chain.

          D. A participant who is absent from active Employee status for a portion of a Plan Period by
reason of an authorized leave of absence shall not be deemed to have ceased Employee status during
the period of that leave. However, any bonus to which such participant may otherwise become
entitled under the Plan for that Plan Year may be pro-rated based on the portion of the Plan Period
during which that individual is in active working status and not on such leave of absence, unless
the Plan Administrator otherwise deems it appropriate under the circumstances to provide that
individual with a full bonus for the Plan Period.

     IV. DETERMINATION OF PERFORMANCE GOALS AND POTENTIAL BONUS POOL AMOUNTS

          A. Participants will be eligible to receive cash awards under the Plan for each Plan Year for
which one or more performance objectives established for that Plan Year by the Plan Administrator
are attained. The Plan Administrator shall, as soon as practicable at the beginning of each Plan
Year, establish the specific performance objectives for that Plan Year. In no event may a
performance objective be established at a time when there exists no substantial uncertainty as to
its attainment.

          B. For the Plan Year ended December 31, 2007, the applicable performance objectives were set
on the basis of the following measures: (i) net revenue, (ii) non-GAAP gross margin, (iii)
non-GAAP operating margin, (iv) non-GAAP earnings per share and (v) non-GAAP free cash flow. In
determining whether the non-GAAP measures under clauses (ii), (iii), (iv) and (v) were attained,
the Plan Administrator applied the dollar amounts that the Company reported for those items in
accordance with U.S. generally accepted accounting principles (“GAAP”), as adjusted for certain
non-cash, non-recurring, extraordinary and other items set forth in Paragraph IV.D.

3

 

          C. For the Plan Year ended December 31, 2008, the Plan Administrator set the applicable
performance objectives on the basis of the following measures: (i) net revenue; (ii) non-GAAP
earnings per share and (iii) working capital, as measured by days sales outstanding and inventory
turns. In determining whether the non-GAAP measures under clauses (ii) and (iii) were attained, the
Plan Administrator applied the dollar amounts that the Company reported for those items in
accordance with GAAP as adjusted for certain non-cash, non-recurring, extraordinary and other items
set forth in Paragraph IV.E. Each of the three performance objectives for the 2008 Plan Year was
measured separately in terms of actual level of attainment and weighted as follows in determining
the actual dollar amount of the total bonus pool: (i) the net revenue objective at 0.4, (ii)
non-GAAP earnings per share objective at 0.4 and (iii) working capital objective at 0.2.

          D. For the Plan Year ending December 31, 2009, the Plan Administrator shall set the applicable
performance objectives on the basis of the following measures: (i) revenue growth (excluding
extraordinary items at the discretion of the Plan Administrator) as measured in relation to the
revenue growth of one or more peer companies or identified industry segments, (ii) net cash
provided by operations (excluding extraordinary items at the discretion of the Plan Administrator)
and (iii) corporate and individual performance and achievements, as measured and assessed in such
terms and objectives as the Plan Administrator may determine in its sole discretion. Each of the
performance objectives for the 2009 Plan Year shall be measured separately in terms of actual level
of attainment and shall be weighted as follows in determining the actual dollar amount of the total
bonus pool: (i) relative revenue growth at forty percent (40%), (ii) net cash provided by
operations at forty percent (40%) and (iii) corporate and individual performance and achievements
as measured and assessed by the Plan Administrator at twenty percent (20%).

          E. For each subsequent Plan Year during the term of the Plan, the performance objectives may
include one or more of the measures used as the 2007, 2008 or 2009 Plan Year performance objectives
as well as one or more of the following: (i) return on total shareholder equity; (ii) net income
or operating income; (iii) earnings before interest, taxes, deprecation, amortization and
stock-based compensation costs, or operating income before depreciation and amortization; (iv)
return on assets, capital or investment; (v) market share in one or more markets; (vi) cost
reduction goals; (vii) budget comparisons; (viii) implementation or completion of projects or
processes strategic or critical to the Company’s business operations; (ix) measures of customer
satisfaction; (x) the formation of joint ventures, research and development collaborations,
marketing or customer service collaborations, or the completion of other corporate transactions
intended to enhance the Company’s revenue or profitability or expand its customer base; (xi)
completion of project milestones; and (xii) any combination of, or a specified increase in, any of
the foregoing provided, however, that for purposes of items (ii) and (vi) above (as well as items
(ii), (iii), (iv) and (v) of Paragraph IV.B and items (ii) and (iii) of Paragraph IV.C above), the
Plan Administrator may, at the time the performance objects are established, specify certain
adjustments to such items as reported in accordance with GAAP, which will exclude from the
calculation of those performance objectives one or more of the following: certain charges related
to acquisitions, stock-based compensation, employer payroll tax expense on certain stock option
exercises, settlement costs, restructuring costs, gains or

4

 

losses on strategic investments, non-operating gains, certain other non-cash charges,
valuation allowance on deferred tax assets, and the related income tax effects, purchases of
property and equipment, and any extraordinary non-recurring items as described in Accounting
Principles Board Opinion No. 30. In addition, such performance objectives may be based upon the
attainment of specified levels of the Company’s performance under one or more of the measures
described above relative to the performance of other entities and may also be based on the
performance of any of the Company’s business groups or division thereof or any parent or
subsidiary.

          F. For each performance objective, the Plan Administrator may establish up to four (4)
designated levels of attainment: threshold, above-threshold, target and above-target levels of
attainment.

          G. The Plan Administrator shall also establish the maximum bonus pool to be paid in total
under the Plan for each designated level of performance for a Plan Year.

               - For the Plan Year ended December 31, 2007, the maximum bonus pool payable at each designated
level of performance was as follows: for performance of each objective at the threshold level, the
pool was set at $0; for performance of each objective at the above-threshold level, the pool was
set at $7,550,000; for performance of each objective at the target level, the pool was set at
$15,100,000; and for performance of each objective at the above-target level the pool was set at
$22,650,000.

               - For the Plan Year ended December 31, 2008, the maximum bonus pool payable at each designated
level of performance was as follows: for performance of each objective at threshold level, the
pool was set $0; for performance of each objective at the target level, the pool was set at
$24,000,000; and for performance of each objective at the above-target level the pool was set at
$45,600,000.

               - For the Plan Year ending December 31, 2009, the bonus pool payable at each designated level
of performance shall be as follows: for performance at the threshold level, the pool shall be $0;
if each of the two financial objectives is attained at the target level, then the pool with the 20%
discretionary component shall be $40,000,000; and if each of the two financial objectives is
attained the at the above-target level, then the pool with the 20% discretionary component shall
be $80,000,000.

          H. The actual bonus pool for each Plan Year shall be determined by the Plan Administrator in
whole or in part on the basis of the Company’s actual performance relative to each of the
performance objectives established for that Plan Year; provided, however, that the Plan
Administrator shall have the full power and authority to increase or decrease the total actual
bonus pool as so determined for any Plan Year as it deems appropriate or advisable. Accordingly,
for any Plan Year the actual bonus pool may, in the Plan Administrator’s discretion, be funded in
an amount that exceeds the maximum bonus pool that would otherwise result solely on the basis of
the attained level of the applicable performance objectives for that Plan Year. Each performance
objective shall be measured separately in terms of actual level of attainment and shall be
weighted, equally or in such other proportion as the Plan Administrator shall determine at the time
such performance objectives are established, in determining the actual

5

 

total bonus pool. For example, if five (5) performance objectives are established and weighted
equally, then each of those objectives attained at target level will contribute to the total bonus
pool for the Plan Year in an amount equal to twenty percent (20%) of the total bonus pool payable
at target level for that Plan Year, and each objective attained at above-target level will
contribute to the total bonus pool for that Plan Year in an amount equal to twenty percent (20%) of
the total bonus pool at above-target level. If the actual level of attainment for any performance
objective is between two specified levels, then the bonus amount attributable to that performance
objective shall be interpolated on a straight-line basis or on such other basis as determined by
the Plan Administrator prior to the start of that Plan Year. The dollar amount of the actual bonus
pool shall be determined by the Plan Administrator as soon as administratively practicable
following the completion of the audit of the Company’s financial statements for the applicable Plan
Year by the Company’s independent registered public accounting firm.

     V. INDIVIDUAL BONUS AWARDS

          A. The actual bonus award to be made to each participant who is a Section 16 Officer shall be
determined at the sole discretion of the Plan Administrator, and the actual bonus award made to
each participant who is not a Section 16 Officer shall be approved by the Plan Administrator, based
upon the recommendation of the Company’s management. The amount of the actual bonus awarded to
each participant shall be determined at the sole discretion of the Plan Administrator, and the
amount of the actual bonus recommended for each participant who is not a Section 16 Officer shall
be at the sole discretion of the Company’s management. Accordingly, the actual bonus award for
each participant may be more or less than the individual bonus pool allocation that would otherwise
be established for that participant based solely on the attained level of the performance
objectives in effect for the Plan Year to which that bonus relates.

          B. Except as otherwise provided in Paragraph III.B, no participant shall accrue any right to
receive a bonus award under the Plan unless and until that participant remains in Employee status
through the Distribution Date. Accordingly, no bonus payment shall be made to any participant who
ceases Employee status prior to the Distribution Date, provided, however, that the provisions of
Paragraph III.B shall govern the bonus entitlement of participants whose Employee status terminates
under the various circumstances set forth in those provisions.

          C. The Distribution Date for the individual bonus amount payable to each participant for a
particular Plan Year shall occur as soon as practicable following the completion of that Plan Year
and the Plan Administrator’s determination of the actual performance levels for that Plan Year, but
in no event shall such Distribution Date occur at any time prior to the date the Company’s
independent registered public accounting firm completes its audit of the Company’s financial
statements for that Plan Year or at any time after the last day of the calendar year immediately
succeeding such Plan Year

          D. All bonus payments shall be made in cash, subject to the Company’s collection of all
applicable federal, state and local income and employment withholding taxes.

6

 

     VI. GENERAL PROVISIONS

          A. The Plan and all rights hereunder shall be construed, administered and governed in all
respects in accordance with the laws of the State of California without resort to its
conflict-of-laws provisions. If any provision of the Plan shall be held by a court of competent
jurisdiction to be invalid or unenforceable, the remaining provisions of the Plan shall continue in
full force and effect.

          B. The Plan Administrator may at any time amend, suspend or terminate the Plan, provided such
action does not adversely affect the rights and interests of participants accrued to date under the
Plan or otherwise impair their ability to earn a bonus award based upon the performance objectives
established by the Plan Administrator for the Plan Year.

          C. Neither the action of the Company in establishing or maintaining the Plan, nor any action
taken under the Plan by the Plan Administrator, nor any provision of the Plan itself shall be
construed to grant any person the right to remain in Employee status for any period of specific
duration, and each participant shall at all times remain an Employee at-will and may accordingly be
discharged at any time, with or without cause and with or without advance notice of such discharge.

          D. Should a participant die before payment is made of the actual bonus to which he or she has
become entitled under the Plan, then that bonus shall be paid to the executor or other legal
representative of his or her estate.

          E. No participant shall have the right to transfer, alienate, pledge or encumber his or her
interest in the Plan, and such interest shall not (to the maximum permitted by law) be subject to
the claims of the participant’s creditors or to attachment, execution or other process of law.

          F. The terms and conditions of the Plan, together with the obligations and liabilities of the
Company that accrue hereunder, shall be binding upon any successor to the Company, whether by way
of merger, consolidation, reorganization or other change in ownership or control of the Company.

          G. No amounts accrued or earned under the Plan shall actually be funded, set aside or to
otherwise segregated prior to actual payment. The obligation to pay the bonuses that actually
become due and payable under the Plan shall at all times be an unfunded and unsecured obligation of
the Company. Participants shall have the status of general creditors and shall look solely and
exclusively to the general assets of the Company for payment.

          H. Any disputes between the Company and a participant arising out of or relating to the Plan,
his or her entitlement to any bonus award hereunder or the amount or method of payment of such
award shall be settled exclusively by binding arbitration to be held in the county in which the
participant is (or has most recently been) employed by the Company (or any subsidiary) at the time
of such arbitration. The arbitration proceedings shall be governed by (i) the national rules of the
American Arbitration Association then in effect for the resolution of employment disputes and (ii)
the Federal Arbitration Act. The decision of the arbitrator shall be

7

 

final and binding on the parties to the arbitration and shall be in lieu of the rights those
parties may otherwise have to a jury trial.

8

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