Document:

Severance and Change in Control Agreement - Richard Hegberg

  
 Exhibit 10.4

 SEVERANCE AND CHANGE IN CONTROL AGREEMENT 
 Richard Hegberg 
 Address on File 
 Dear Rick: 
 This Severance and Change in Control Agreement (this
“Agreement”) amends the employment letter agreement dated June 5, 2010 (the “Prior Agreement”), by and between Atheros Communications, Inc. (the “Company”) and you. This Agreement supersedes any written or verbal
relating to severance payments and benefits, including payments and benefits upon termination in the event of a change in control of the Company. 
 Severance. If the Company terminates your employment other than for Cause (as defined below) prior to a Change of Control (as defined below) or more than 12 months following a Change of Control,
and provided that you sign and do not revoke within the time period specified by the Company a standard release of claims in a form mutually acceptable to the Company and you, then you will receive the following: (a) a lump sum severance
payment within 30 days following your termination equal to six months of your base salary at the highest rate in effect during your employment with the Company, and (b) if you properly elect to continue the Company’s group health plan
coverage under COBRA, the continuation of your health coverage for you and your enrolled dependents at no cost to you for six months following the effective date of termination. You will be able to continue your health benefits beyond six months at
your own expense as allowed under the Company’s health plans. 
 Change In Control: In the event of a Change of
Control (as defined below), if your employment is terminated without Cause (as defined below) or you terminate your employment for Good Reason (as defined below), in either case within 12 months following the Change of Control, and provided that you
sign and do not revoke within the time period specified by the Company (or its successor) a standard release of claims in a form mutually acceptable to the Company (or its successor) and you, then you shall receive the following: (a) a lump sum
severance payment within 30 days following your termination equal to 12 months of your base salary at the highest rate in effect during your employment with the Company; (b) if you properly elect to continue the Company’s group health plan
coverage under COBRA, continuation by the Company (or its successor) of your health coverage for you and your enrolled dependents at no cost to you for 12 months following the effective date of termination (you will be able to continue your health
benefits beyond 12 months at your own expense as allowed under the Company’s health plans); (c) if not already paid to you at the time of termination, your earned cash incentive bonus under the Company’s bonus plan in effect for the
calendar year immediately prior to the termination, as determined by the Board of Directors, payable at the time of termination or the time at which the Board of Directors has determined the amount of the bonus, whichever is later; (d) your
baseline target annual cash incentive bonus under the Company’s bonus plan in effect during the calendar year of the termination, pro rated for the portion of the then current calendar year prior to the date of termination, payable within 30
days after the date of your termination; and (e) all of your unvested stock options and restricted stock units granted by the Company to you prior to the Change of Control and that have been assumed or substituted by the acquiring company,
shall become fully vested as of the date of termination, and (f) the period in which vested stock options may be exercised will be extended to the earlier of one year following your termination date or the original expiration date of the option
grant. 

  
 “Change of
Control” means: (a) any merger, acquisition or similar transaction or series of related transactions in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the jurisdiction in
which the Company is incorporated, (b) the sale, transfer or other disposition of all or substantially all of the assets of the Company, or (c) any reverse merger or acquisition in which the Company is the surviving entity but in which
more than fifty percent (50%) of the Company’s outstanding voting stock is transferred to holders different from those who held the stock immediately prior to such merger. 

“Cause” means (a) intentional and material dishonesty in the performance of your duties for the Company; (b) conduct
(including conviction of or plea of nolo contendere to a felony) which has a direct and material adverse effect on the Company or its reputation; (c) failure to materially perform your reasonable duties or comply with your obligations under
this Agreement or the Company’s Confidential Information and Invention Assignment Agreement after receipt of written notice specifying the failure, if you do not remedy that failure within 10 business days of receipt of written notice from the
Company, which notice will state that failure to remedy such conduct may result in termination for Cause; or (d) an incurable material breach of the Company’s Confidential Information and Invention Assignment Agreement, including, without
limitation, theft or other misappropriation of the Company’s proprietary information. 
 “Good Reason” means
(a) any material reduction in your authorities, duties or responsibilities not approved in writing by you; provided, however, that any reduction in your authorities, duties or responsibilities occurring in connection with a Change in Control of
the Company shall not constitute either Good Reason or a constructive termination of your employment; (b) any material reduction in your then current base salary plus target bonus opportunity compensation; or (c) any requirement that your
principal place of work for the Company be relocated more than 50 miles from its then current location. Notwithstanding the foregoing, a termination shall not be considered to be for “Good Reason” unless you notify the Company of the
existence of the condition constituting Good Reason within 90 days following the initial existence thereof, the Company fails to remedy the condition within 30 days following the receipt of such notice, and you terminate employment within 120 days
following the initial existence of such condition. 
 All payments and benefits under this Agreement shall be subject to
applicable withholding taxes. 
 Section 409A: 

 

	 	•	 	 If, as of the date of your “separation from service” from the Company, you are a “specified employee” (each, for purposes of this
Agreement, within the meaning of Section 409A of the Internal Revenue Code of 1986 (the “Code”) and the guidance issued thereunder (“Section 409A”)), then each payment under this Agreement that would otherwise be paid within
the six-month period following your “separation from service” shall not be paid until the date that is six months and one day after such separation from service (or, if earlier, the date of your death), with any such payment that is
required to be delayed being accumulated during the six-month period and paid in a lump sum on the date that is six months and one day following your separation from service and subsequent payments, if any, being paid in accordance with the dates
and terms set forth herein; provided, however, that the preceding provisions of this sentence shall not apply to any payments if and to the maximum extent that such payments are excluded from the definition of nonqualified

  
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deferred compensation subject to Section 409A, or can otherwise be paid during such six-month period without violating the requirements of Section 409A(a)(2) under applicable guidance
under Section 409A. Such payments shall bear interest at an annual rate equal to the prime rate as set forth in the Eastern edition of the Wall Street Journal on the date of termination, from the date of termination to the date of payment.

  

	 	•	 	 Your date of termination for purposes of determining the date that any payment that is treated as nonqualified deferred compensation under
Section 409A is to be paid or provided (or in determining whether an exemption to such treatment applies), shall be the date on which you have incurred a “separation from service” within the meaning of applicable Treasury Department
or Internal Revenue Service guidance under Section 409A. 

 Section 280G: 

In the event that any benefits payable to you pursuant to this Agreement (“Termination Benefits”) (i) constitute
“parachute payments” within the meaning of the Code, and (ii) but for this paragraph would be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then your Termination Benefits shall be
reduced to such lesser amount which would result in no portion of such benefits being subject to the Excise Tax. Unless the Company and you otherwise agree in writing, any determination required under this paragraph shall be made in writing in good
faith by a nationally recognized accounting firm selected by the Company (the “Accountants”). In the event of a reduction of benefits hereunder, benefits shall be reduced in the order which results in the greatest economic benefit to you.
For purposes of making the calculations required by this paragraph, the Accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of
the Code, and other applicable legal authority. The Company and you shall furnish to the Accountants such information and documents as the Accountants may reasonably request in order to make a determination under this paragraph. The Company shall
bear the cost of all fees the Accountants charge in connection with any calculations contemplated by this paragraph. 
 Nothing
in this Agreement shall alter the at-will nature of your employment or provide an obligation express or implied for the payment of severance except as expressly provided herein. 

Except as amended hereby, all other terms and conditions of the Prior Agreement shall remain in full force and effect. This Agreement and
the Prior Agreement constitute the complete and entire agreement among the parties relating to the subject matter thereof, and there are no prior or contemporaneous oral or written representations, promises or agreements not expressly set forth
therein. This Agreement may not be modified in any respect except by a writing dated and signed by the parties hereto. 

  
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 In order to confirm
your agreement with and acceptance of the foregoing provisions of this Agreement, please sign one copy of this letter and return it to Sharon Thompson. The other copy is for your records. 

 

			
	Very truly yours,
	
	ATHEROS COMMUNICATIONS, INC.
		
	By:	 	     /s/ Craig H. Barratt

	Title:	 	President and Chief Executive Officer

 The
undersigned agrees to the amendment of the Prior Agreement set forth in this Severance and Change in Control Agreement. 
  

					
	   /s/ Richard Hegberg
	  		  	    10/12/2010
	Richard Hegberg	  		  	Date

  
 4Stipulation and Consent to the Issuance of a Consent Order

 Exhibit 10.1 
 UNITED STATES OF AMERICA 
 FEDERAL HOUSING FINANCE AGENCY 

					
	  
	    	
		  	)	    	
		  	)	    	
	In the Matter of:	  	)	    	 Stipulation and Consent No. 2010-01

	The Federal Home Loan Bank of Seattle	  	)	    	
		  	)	    	
	 )
	    	

 STIPULATION AND CONSENT TO THE 

ISSUANCE OF A CONSENT ORDER  
 WHEREAS, the Federal Housing Finance Agency (“Agency”) is charged with the supervision and oversight of the Federal Home Loan Banks pursuant to sections 1311 and 1313 of the Federal
Housing Enterprises Financial Safety and Soundness Act of 1992 (“1992 Act”), 12 U.S.C. §§ 4511 and 4513, as amended by the Housing and Economic Recovery Act of 2008 (“HERA”), PL 110-289, Titles I-III, 122 Stat. 2654
(July 30, 2008); 
 WHEREAS, the Federal Home Loan Bank of Seattle (“Bank”) is a Federal Home Loan Bank that
has been established pursuant to section 3 of the Federal Home Loan Bank Act (“Bank Act”), 12 U.S.C. § 1423, and operates pursuant to the Bank Act and the 1992 Act as such acts have been amended by HERA; 

WHEREAS, the Bank, as a Federal Home Loan Bank, is subject to the supervisory, regulatory and enforcement authority conferred on
the Agency by the 1992 Act and the Bank Act, as amended; 
 WHEREAS, the Bank recognizes its responsibilities to assure
that sufficient resources are available to meet its obligations on all of the Bank’s debt obligations, even under various scenarios evaluated by the Bank and the Agency; 

 WHEREAS, the Bank is organized as a member-owned cooperative and the investment of
the member-owners in the Bank protects the Bank’s debt holders; 
 WHEREAS, as a member-owned cooperative, the Bank
must treat member-owners consistently and the five year stock redemption waiting period, contained in section 6(a)(4) of the Bank Act, 12 U.S.C. § 1426(a)(4), provides for sufficient time for potential losses from activities undertaken at a
point in time to emerge and be the responsibility of all the shareholders rather than rewarding the first to leave and imposing any realized losses on the remaining members; 
 WHEREAS, the Bank has sought to restore its ability to return capital at par to its member-owners and to do so would require, for the current time, a continued suspension on any and all return of
capital for a Stabilization Period, commencing on this date and ending on the date of the filing of the Bank’s June 30, 2011 financial statements with the Securities and Exchange Commission; 

WHEREAS, if certain minimum financial and operational metrics are satisfied after the Stabilization Period, capital may begin to
be returned to members at par on a pro-rata basis; 
 WHEREAS, at such time as the Bank has returned to a safe and sound
condition as determined by FHFA, redemption requests will be satisfied at par in the order the request was received for members that will have already satisfied the five year redemption notice period; 

WHEREAS, the Bank and the Agency wish to resolve matters related to the Bank’s capital and stock and other supervisory
concerns, including matters relating to improvement of its asset base, capital adequacy and retained earnings, risk management, senior management, information technology, compensation practices and remediation of examination findings; 

  
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 WHEREAS, to that end, the Agency has determined that it is necessary for the Bank to
take certain actions to remedy the unsafe and unsound practices and its supervisory concerns; and, 
 WHEREAS, the Bank,
desiring to cooperate with the Agency without the need for administrative or enforcement actions by the Agency and for the purpose of resolving this matter and in the interest of addressing immediately any matters that could adversely affect the
interests of members of the Bank, hereby consents to the issuance of the accompanying Consent Order (“Order”). 

NOW THEREFORE, in consideration of the above, the Agency and the Bank, through the Chairman of the Board of Directors acting upon
resolution of the Board of Directors, hereby stipulate and agree to the following: 
 Article I 

Jurisdiction 
 (a) The Bank is a Federal Home Loan Bank as defined in section 2 of the Bank Act, 12 U.S.C. § 1422 and as such is subject to the regulation and oversight of the Agency pursuant to sections 1311 and
1313 of the 1992 Act, 12 U.S.C. §§ 4511 and 4513. 
 (b) The Agency has authority pursuant to the Bank Act and the
1992 Act, as amended by the Housing and Economic Recovery Act of 2008, to initiate and maintain an administrative proceeding against a Bank pursuant to 12 U.S.C. § 4631. 
 (c) The Bank, without admitting or denying that grounds exist to initiate an administrative enforcement proceeding against the Bank, and in accordance with section 1371(f) of the 1992 Act, 12 U.S.C §
4631 (f), hereby consents and agrees to the issuance of the Order by the Agency. 

  
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 (d) The Bank further agrees that the Order shall be “an order issued upon
consent,” as that phrase is used in Section 1371(f) of the 1992 Act, 12 U.S.C. § 4631(f), as amended by HERA, and shall be effective upon issuance by the Agency. 

(e) Upon issuance, the Order shall be fully enforceable by the Agency in accordance with the authority and procedures set forth in
Subtitle C of the 1992 Act, 12 U.S.C. §§ 4631-4642, as amended by HERA and with any other supervisory powers afforded the Agency under the Bank Act, the 1992 Act or any other applicable statute. 

Article II 

Waivers 

In entering into this Stipulation and Consent to the Issuance of an Order, the Bank expressly waives each of the following: 

(a) the right to the issuance and service of a Notice of Charges pursuant to section 1371 (a) of the 1992 Act, 12 U.S.C.
§ 4631(a), as amended by HERA, and 12 C.F.R. § 908.4(a); 
 (b) all rights to a hearing on the record or a
final agency decision pursuant to Section 1371 (c) and 1373 of the 1992 Act, 12 U.S.C. § 1431(c) and 4633, as amended by HERA, and 12 C.F.R. §§ 908.4(b)(1) and 908.9; 

(c) any and all procedural rights available in connection with the issuance of the Order; 

(d) the right to seek judicial review of the Order pursuant to 12 U.S.C. § 4634 and 12 C.F.R. § 908.10, or otherwise
to challenge the validity of the Order; and, 

  
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 (e) any and all claims
against the Agency, including its employees and agents, and any other governmental entity for the award of fees, costs or expenses related to the Order, whether arising under common law, federal statutes or otherwise. 

Article III 

Miscellaneous 
 (a) The Bank agrees that the provisions of this Stipulation and the Order shall not inhibit, estop, bar or otherwise prevent the Agency from taking any other action affecting the Bank if, at any time, the
Agency deems it appropriate to do so in order to fulfill its statutory supervisory responsibilities and that the Agency will transmit such guidance as it deems appropriate to provide direction to the Bank in meeting the obligations of the Order.

 (b) The Bank agrees that, except as may be specifically set forth in the Order or in any future amendment thereto, the
Bank’s consent to issuance of the Order does not release it from any obligations that may have been, or may be, imposed on it by any rule, regulation, or order issued by the Agency or by any condition imposed in writing for any approval granted
by the Federal Housing Finance Board. 
 (c) The Bank further agrees that, notwithstanding the absence of mutuality of
obligation or of consideration or of a contract, the Agency may enforce any of the commitments or obligations herein under its supervisory and enforcement powers conferred by 12 U.S.C. § 4511, 4513 and 4631-4642 and 12 C.F.R.
§ 908.11, and not as a matter of contract law. 
 (d) The laws of the United States of America shall govern the
construction and validity of this Stipulation and of the Order. 

  
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 (e) All references to the Agency in this Stipulation and the Order shall also mean any of
the Agency’s predecessors, successors or assigns. 
 (f) This Stipulation and the Order shall remain in effect until
terminated, modified or suspended in writing by the Agency. 
 IN TESTIMONY TO THIS STIPULATION AND CONSENT TO ISSUANCE OF A
CONSENT ORDER, the undersigned, authorized by the Agency and by Board of Directors of the Bank as its representative, have hereunto set their hand, this 25th day of October 2010. 

 

					
	 /s/ EDWARD J. DEMARCO
	 		 	 /s/ WILLIAM V. HUMPHREYS

	Edward J. DeMarco	 		 	William V. Humphreys
	Acting Director	 		 	Chairman, Board of Directors
	Federal Housing Finance Agency	 		 	Federal Home Loan Bank of Seattle

  
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