Document:

Amended and Restated By-Laws of the Registrant

 Exhibit 4.2 
 AMENDED AND RESTATED 
 BY-LAWS 
 OF 
 NEW SALLY HOLDINGS, INC. 
 November 16, 2006 
 ARTICLE I 
 STOCKHOLDERS 
 Section 1.01. Annual Meeting. An annual meeting of
the stockholders of the Corporation, for the election of directors to succeed those whose terms expire and for the transaction of such other business as may properly come before the meeting, shall be held at such place, on such date, and at such
time as the Board of Directors shall each year fix. 
 Section 1.02. Special Meeting. Special meetings of the stockholders of the
Corporation, for any purpose or purposes prescribed in the notice of the meeting, may be called only by the Board of Directors or the Chairman of the Board, Chief Executive Officer or President and shall be held at such place, on such date, and at
such time as they or he or she shall fix. 
 Section 1.03. Notice of Meetings, Adjournment. Written notice of the place, date,
and time of all meetings of the stockholders shall be given in accordance with this Section 1.03 and Section 7.01, not less than 10 nor more than 60 days before the date on which the meeting is to be held, to each stockholder entitled to
vote at such meeting, except as otherwise required by law. 
 When a meeting is adjourned to another place, date or time, written notice need
not be given of the adjourned meeting if the place, date and time thereof are announced at the meeting at which the adjournment is taken; provided, however, that if the date of any adjourned meeting is more than 30 days after the date
for which the meeting was originally noticed, or if a new record date is fixed for the adjourned meeting, written notice of the place, date, and time of the adjourned meeting shall be given in accordance with this Section 1.03 and
Section 7.01. At any adjourned meeting, any business may be transacted which might have been transacted at the original meeting. 
 An
affidavit of the mailing or other means of giving any notice of any stockholders’ meeting, executed by the Secretary, Assistant Secretary or any transfer agent of the Corporation giving the notice, shall be prima facie evidence of the giving of
such notice. 

 Section 1.04. Quorum. At all meetings of the stockholders of the Corporation, the holders of
stock issued and outstanding and entitled to cast a majority of the votes entitled to be cast thereat, present in person or by proxy, shall constitute a quorum for the transaction of any business, except to the extent that the presence of a larger
percentage may be required by these By-Laws, by law or by the Amended and Restated Certificate of Incorporation. If such majority (or such larger percentage) shall not be present or represented at any meeting of the stockholders, the Chairman of the
meeting or stockholders entitled to cast a majority of the votes entitled to be cast thereat, present in person or by proxy, shall have power to adjourn the meeting to another place, date or time. 
 Section 1.05. Stockholders Entitled to Vote; Record Date. In order that the Corporation may determine the stockholders entitled to notice of
or to vote at any meeting of stockholders or any adjournment thereof, or to receive payment of any dividend or other distribution or allotment of any rights or to exercise any rights in respect of any change, conversion or exchange of stock or for
the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date on which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not
be more than 60 nor less than 10 days before the date of any meeting of stockholders, nor more than 60 days prior to the time for such other action as hereinbefore described; provided, however, that if no record date is fixed by the
Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the next day preceding the day on which notice is given or, if notice is waived, at
the close of business on the day next preceding the day on which the meeting is held. 
 A determination of stockholders of record entitled
to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting. 
 Section 1.06. Order of Business at Annual Meetings and Special Meetings. At any annual meeting or special meeting, such business (including
nominations for election of directors) shall be conducted only if brought before such meeting by or at the direction of the Board of Directors or by any stockholder who complies with the procedures set forth in this Section 1.06. 
 For business to be properly brought before an annual or special meeting by a stockholder, the business must be a proper subject for action by
stockholders and the stockholder must give written notice to the Secretary in accordance with this Section 1.06. The stockholder’s notice must be received by the Secretary at the principal executive offices of the Corporation (a) in
the event of an annual meeting of stockholders (other than the 2007 annual meeting of the stockholders), not more than 120 days and not less than 90 days in advance of the anniversary date of the immediately preceding annual meeting provided,
however, that in the event that the annual meeting is called for a date 
  

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 that is not within 30 days before or after such anniversary date, notice by the stockholder in order to be timely must be
so received not later than the close of business on the 15th day following the day on which notice of the date of the annual meeting was mailed or public disclosure of the date of the annual meeting was made, whichever first occurs; (b) in the
event of a special meeting of stockholders, not later than the close of business on the 15th day following the day on which notice of the meeting is first mailed to stockholders or public disclosure of the date of the special meeting was made,
whichever first occurs or (c) in the case of proposals required to be included in the Corporation’s Proxy Statement pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, in accordance with that rule. Except for
stockholders’ proposals required to be included in the Corporation’s Proxy Statement pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, to be in proper written form, a stockholder’s notice to the Secretary shall set
forth as to each matter the stockholder proposes to bring before the meeting the following: (i) a description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and the complete
text of any resolutions to be presented at the meeting; (ii) the stockholder’s name and address, as it appears on the Corporation’s books; (iii) a representation that the stockholder is a holder of the Corporation’s voting
stock and the class or series and number of shares of stock of the Corporation which are beneficially owned by the stockholder; and (iv) any material interest of the stockholder in such business. In the case of nomination(s) for election as a
director, the stockholder’s notice must comply with the previous two sentences and shall also include (A) the name, age, business address and residence address of the nominee(s), (B) the principal occupation or employment of the
nominee(s), (C) the class or series and number of shares of stock of the Corporation which are owned beneficially or of record by the nominee(s), (D) a description of all arrangements or understandings among the stockholder and the
nominee(s), pursuant to which the nomination(s) are to be made by the stockholder and (E) any other information relating to the nominee(s) that would be required to be disclosed in a proxy statement or other filings required to be made in
connection with solicitations of proxies for election of directors pursuant to Section 14 of the Securities Exchange Act of 1934. All notices of intent to make a nomination for election as a director shall be accompanied by the written consent
of each nominee to serve as director of the Corporation if so elected. The Chairman of the meeting shall, if the facts warrant, determine and declare that business (including any nominations for election as a director) not properly brought before
the meeting in accordance with the provisions of this Section 1.06 shall not be transacted at the meeting. 
 At all meetings of the
stockholders, the Chairman of the Board of Directors, or, in the Chairman’s absence, any Vice-Chairman of the Board of Directors, the Chief Executive Officer, the President, or, in the absence of all of the foregoing officers, the most senior
Vice-President, shall act as Chairman of the meeting. The Chairman of the meeting shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts and things as are necessary or desirable for the proper
conduct of the meeting, including, without limitation, the establishment of 
  

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 procedures for the dismissal of business not a proper matter for stockholder action or not properly presented, the
maintenance of order and safety, limitations on the time allotted to questions or comments on the affairs of the Corporation, restrictions on entry to such meeting after the time prescribed for the commencement thereof, the opening and closing of
the voting polls and the adjournment of the meeting. 
 Section 1.07. Proxies. Every stockholder may authorize another Person or
Persons to act for him or her by proxy in all matters in which a stockholder is entitled to participate, including waiving any notice of any meeting, voting or participating at a meeting, or expressing consent or dissent without a meeting. No proxy
shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. A duly executed proxy shall be irrevocable if it states that it is irrevocable, and if and only so long as it is coupled with an interest
sufficient in law to support an irrevocable power. 
 Section 1.08. Voting by Fiduciaries and Pledgors. Persons holding stock in
a fiduciary capacity shall be entitled to vote the shares so held, and Persons whose stock is pledged shall be entitled to vote such shares, unless in the transfer by the pledgor on the books of the Corporation he or she has expressly empowered the
pledgee to vote such shares, in which case only the pledgee or his or her proxy may represent said stock and vote thereon. 
 Section 1.09. Method of Voting. The vote at any election or upon any question at any meeting of stockholders need not be by written ballot, except as required by law. Directors shall be elected by a plurality of the votes cast.
All other matters shall be determined by a majority of the votes entitled to be cast by the shares of stock present in person or by proxy at the meeting and entitled to vote thereon, unless a greater vote or percentage is required by law or the
Amended and Restated Certificate of Incorporation for the action proposed. 
 Section 1.10. Stockholders List. A complete list of
stockholders entitled to vote at any meeting of stockholders, arranged in alphabetical order for each class or series of stock and showing the address of each such stockholder and the number of shares registered in his or her name, shall be open to
the examination of any such stockholder, for any purpose germane to the meeting, during ordinary business hours for a period of at least 10 days prior to the meeting, either at a place within the city where the meeting is to be held, which place
shall be specified in the notice of the meeting, or if not so specified, at the place where the meeting is to be held. 
 The stockholders
list shall also be kept at the place of the meeting during the whole time of the meeting and shall be open to the examination of any such stockholder who is present. This list shall presumptively determine the identity of the stockholders entitled
to vote at the meeting and the number of shares held by each of them. 
  

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 Section 1.11. Stockholder Action. No corporate action of stockholders of the Corporation may
be taken without a meeting and vote of stockholders. 
 ARTICLE II 
 BOARD OF DIRECTORS 
 Section 2.01. Management of Business;
Qualifications of Directors. The business of the Corporation shall be managed by a Board of Directors. Directors need not be stockholders. 
 Section 2.02. Number and Election. The number of directors which shall constitute the whole Board of Directors shall be 11 persons. 
 (a) Classified Board of Directors. Except as provided by the Amended and Restated Certificate of Incorporation, the directors shall be classified with respect to the time for which they severally hold office,
into three classes, as nearly equal in number as possible: one class (“Class I”) whose term expires at the 2007 annual meeting of stockholders, another class (“Class II”) whose term expires at the 2008 annual
meeting of stockholders, and another class (“Class III”) whose term expires at the 2009 annual meeting of stockholders, with each class to hold office until its successors are elected and qualified. If the number of directors is
changed, any increase or decrease shall be apportioned among the classes so as to maintain the number of directors in each class as nearly equal as possible, and any additional director of any class elected to fill a vacancy resulting from an
increase in such class shall hold office for a term that shall coincide with the remaining term of that class, but in no case will a decrease in the number of directors shorten the term of any incumbent director. 
 (b) How Constituted. As of the date hereof, subject to Section 6.2(a) of the Investment Agreement, dated as of June 19,
2006, among Alberto-Culver Company, New Aristotle Company, Sally Holdings, Inc., the Corporation and CDRS Acquisition LLC (as may be amended or modified from time to time in accordance with its terms, the “Investment Agreement”),
the Board of Directors shall consist of five directors designated by CDRS Acquisition LLC, at least two of whom qualify as Independent Directors (“CDR Investor”, such directors and any replacements of such directors nominated or
designated by CDR Investor or the directors nominated or designated by CDR Investor, the “CDR Designees”) and six directors, one of whom shall be the individual identified pursuant to Section 6.2(a) of the Investment Agreement
and five additional directors designated by Alberto-Culver Company, at least four of whom qualify as Independent Directors (such designees and any persons elected as directors to replace such designees or to replace any CDR Designees who resign
pursuant to Section 2.02(c) hereof, the “Non-CDR Designees”). As of the date hereof, 
  

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 subject to Section 6.2(a) of the Investment Agreement, each of Class I and Class II shall consist of
two CDR Designees and two Non-CDR Designees and Class III shall consist of one CDR Designee and two Non-CDR Designees. 
 (c)
Nominating Rights to the Board of Directors. Following the 2007 annual meeting of stockholders: (i) so long as the CDR Percentage Interest equals or exceeds 45%, CDR Investor shall have the right to nominate five directors;
(ii) if the CDR Percentage Interest is less than 45% but equals or exceeds 35%, CDR Investor shall have the right to nominate four directors; (iii) if the CDR Percentage Interest is less than 35% but equals or exceeds 25%,
CDR Investor shall have the right to nominate three directors; (iv) if the CDR Percentage Interest is less than 25% but equals or exceeds 15%, CDR Investor shall have the right to nominate two directors; and (v) if the CDR
Percentage Interest is less than 15% but equals or exceeds 5%, CDR Investor shall have the right to nominate one director. The provisions in these By-Laws setting forth special nomination or other rights for CDR Investor will terminate at the tenth
anniversary of the date hereof. Following the 2007 annual meeting of the Corporation, the remaining directors of the Board shall be nominated in accordance with these By-Laws. 
 (d) Election of Directors. At the 2007 annual meeting of stockholders and each annual meeting of stockholders thereafter, the date
of which will be fixed pursuant to Section 1.01 hereof, the successors of the class of directors whose term expires at that meeting shall be elected to hold office for a term expiring at the annual meeting of stockholders held in the third year
following the year of their election. 
 (e) Definitions. 
 (i) “Affiliate” means, with respect to any Person, (i) any Person directly or indirectly Controlling,
Controlled by or under common Control with such Person or (ii) any officer, director, general partner or trustee of any of the foregoing. 
 (ii) “Beneficially Own” with respect to any securities shall mean having “beneficial ownership” of such securities (as determined pursuant to Rule 13d-3 under the Exchange Act), including
pursuant to any agreement, arrangement or understanding, whether or not in writing. 
 (iii) “CDR Percentage
Interest” means the percentage of Total Voting Power, determined on the basis of the number of Voting Shares actually outstanding, that is controlled directly or indirectly by CDR Investor and its Affiliates, including as Beneficially
Owned. For purposes of determining the CDR Percentage Interest, (a) any options, rights, warrants and similar securities that entitle the holder thereof to acquire 
  

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 shares of any class of capital stock of the Corporation, whether voting or non-voting, shall be treated
as exercised, (b) any debt security that is convertible into shares of any class of capital stock of the Corporation, whether voting or non-voting, shall be treated as converted, and (c) any equity security that is
convertible into shares of any class of capital stock of the Corporation, whether voting or non-voting, shall be treated as converted, but in each case only to the extent that such exercise or conversion would result in the CDR Percentage Interest
being greater than such interest would be if such conversion had not been deemed to occur. 
 (iv) “Control”
means the power to direct the affairs of a Person by reason of ownership of Voting Shares, by contract or otherwise. 
 (v)
“Independent Director” means an individual who, as a member of the Board of Directors, following the date hereof, would be independent of the Corporation under the rules of the New York Stock Exchange, Inc. 
 (vi) “Person” means an individual, a partnership, a joint venture, a corporation, a limited liability company, a trust,
an unincorporated organization or a government or department or agency thereof. 
 (vii) “Total Voting Power”
at any time shall mean the total combined voting power in the general election of directors of all the Voting Shares then outstanding. 
 (viii) “Voting Shares” means, at any time, shares of any class of stock of the Corporation, which are then entitled to vote generally in the election of directors. 
 Section 2.03. Chairman of the Board. The directors shall elect from among the members of the Board of Directors a Chairman of the Board, who
as of the date hereof shall be a CDR Designee. The Chairman of the Board shall be deemed an officer of the Corporation and shall have such duties and powers as set forth in these By-Laws or as shall otherwise be conferred upon the Chairman of the
Board from time to time by the Board of Directors. The Chairman of the Board shall, if present, preside over all meetings of the stockholders of the Corporation and of the Board of Directors. The Board of Directors shall by resolution establish a
procedure to provide for an acting Chairman of the Board in the event the current Chairman of the Board is unable to serve or act in that capacity. 
 Section 2.04. Removal of Directors. Except as provided by the Amended and Restated Certificate of Incorporation, any director may be removed at any time, but only for cause, upon the affirmative vote of the holders of a majority
of the combined voting 
  

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 power of the Voting Shares then outstanding. Any vacancy in the Board of Directors caused by any such removal may be
filled only in the manner provided in Section 2.05 of these By-Laws. 
 Section 2.05. Vacancies and Increases. Subject to
Section 2.02(c) hereof, and except as provided by the Amended and Restated Certificate of Incorporation, any vacancies occurring in the Board of Directors and any newly-created directorships resulting from an increase in the authorized number
of directors may only be filled by a majority of the remaining directors (though less than a quorum of the Board of Directors), and any director so chosen shall hold office until (i) the next election of the class for which he or she was chosen
and until his or her successor is duly elected and qualified or (ii) his or her earlier resignation or removal, provided that the CDR Designees who are members of the Nominating and Corporate Governance Committee (or if none remain in
office, the remaining CDR Designees) shall have the right to designate any replacement for a CDR Designee upon the death, resignation, retirement, disqualification or removal from office of such director (except for a director removed for cause by
the stockholders ). 
 Section 2.06. Powers. In addition to the powers and authority expressly conferred upon the Board of
Directors by law, and except as may otherwise be provided by the Amended and Restated Certificate of Incorporation or by these By-Laws, the Board of Directors may exercise all the powers of the Corporation and do all such lawful acts and things as
may be done by the Corporation which are not in violation of law, or required to be exercised or done by the stockholders. 
 Section 2.07. Meeting of Newly Elected Board of Directors. The newly elected Board of Directors may meet at the place of the meeting at which such newly elected Board of Directors was elected, for the purpose of organization or
otherwise, and no notice of such meeting to the newly elected directors shall be necessary in order to validly constitute the meeting, provided a quorum shall be present, or they may meet at such time and place as may be fixed by the consent in
writing of all of the newly elected directors, or upon notice as provided in Section 2.10 hereof, or without notice as provided in Section 7.02 hereof. 
 Section 2.08. Meetings. Regular meetings of the Board of Directors may be held at such times as shall from time to time be determined by the Board of Directors. Special meetings shall be held only when
called by the Chief Executive Officer, President, the Secretary or any two directors. 
 Section 2.09. Place of Meetings. Except
as otherwise provided in Section 2.06 hereof, meetings of the Board of Directors may be held at such place within or without the State of Delaware as shall be stated in the notice of meeting or waiver thereof. 
 Section 2.10. Quorum. At all meetings of the Board of Directors, a majority of the total number of directors shall be necessary and
sufficient to constitute a quorum for 
  

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 the transaction of business, and the act of a majority of the directors present at any meeting at which there is a quorum
shall be the act of the Board of Directors unless a greater number is required by the Amended and Restated Certificate of Incorporation. If, at any meeting of the Board of Directors there shall be less than a quorum present, a majority of those
present may adjourn the meeting from time to time until a quorum is obtained. 
 Any member or members of the Board of Directors or of any
Committee of the Board of Directors established in accordance with Section 3.01 may participate in a meeting of the Board of Directors, or any such Committee, as the case may be, by means of a conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear each other and such participation shall constitute presence in person at such meeting. 
 Section 2.11. Board of Directors’ Notices. At least twenty-four hours’ notice of each regular or special meeting of the Board of Directors, stating the time and place for the meeting, shall be
given to each director, by hand delivery to the recipient thereof, by depositing such notice in the mail, postage paid, by courier such as Federal Express or Airborne Express, by telegram, mailgram, telex, telecopy, facsimile transmission,
electronic mail or other similar means of transmission or by personal communication either over the telephone or otherwise, except as otherwise provided in Section 7.02. Any such notice shall be addressed, where applicable, to such director at
his or her last known address as the same appears on the books of the Corporation. Notice of a meeting of the Board of Directors need not state the purpose or purposes thereof and shall be deemed given (i) when received by the director in the
case of hand delivery or personal communication over the telephone or otherwise, (ii) three business days after depositing such notice in the mail in the case of delivery by mail, (iii) one business day after depositing such notice with a
courier such as Federal Express or Airborne Express (specifying next business day delivery) or (iv) when sent in the case of delivery by telegram, mailgram, telex, telecopy, facsimile transmission, electronic mail or other similar means of
transmission. 
 Section 2.12. Compensation. Directors shall receive such fixed sums and expenses or such compensation for
attendance at each meeting of the Board of Directors, or any Committee established in accordance with Section 3.01 as may be determined from time to time by the Board of Directors, provided that nothing herein contained shall be
construed to preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. 
 Section 2.13. Director Action Without a Meeting. Any action required or permitted to be taken at any meeting of the Board of Directors or of any Committee thereof may be taken without a meeting, if a written consent thereto is
signed by all members of the Board of Directors or of such Committee, as the case may be, and such written consent is filed with the minutes of proceedings of the Board of Directors or the Committee. 
  

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 Section 2.14. Resignation and Vacancies. Any director may resign effective on giving written
notice to the Chairman of the Board, the Chief Executive Officer, the President, the Secretary or the Board of Directors, unless the notice specifies a later time for the resignation to become effective. If the resignation of a director is effective
at a future time, the Board of Directors may elect a successor to take office when the resignation becomes effective pursuant to Section 2.04 hereof. 
 ARTICLE III 
 COMMITTEES 
 Section 3.01. How Constituted. The Board of Directors shall have an Audit Committee, a Compensation Committee, a Nominating and Corporate Governance Committee, a Finance Committee and an Executive
Committee (each, a “Committee”). Each Committee shall consist of 4 members, of which 2 shall be CDR Designees and 2 shall be Non-CDR Designees. The members of the Audit Committee, the Compensation Committee and the Nominating and
Corporate Governance Committee shall be Independent Directors. The members of any other Committees shall not be required to be Independent Directors. 
 Except as may otherwise be provided in the Amended and Restated Certificate of Incorporation, each Committee shall have the powers and duties delegated to it by the Board of Directors, subject to the limitations set
forth in the applicable provisions of the General Corporation Law of the State of Delaware (the “DGCL”). The Board of Directors may elect one or more of its members as alternate members of any Committee who may take the place of any absent
or disqualified member or members at any meeting of a Committee, upon request of the Chairman of the Board or the Chairman of such Committee, provided that the CDR Designees shall have the right to designate any alternate member for a CDR
Designee who is a member of a Committee upon the absence or disqualification of such member from any meeting. 
 Section 3.02.
Chairmen of such Committees. CDR Designees shall designate the chairpersons of the Nominating and Corporate Governance Committee, the Compensation Committee and the Finance Committee, and Non-CDR Designees may designate the chairpersons for
any other Committees. 
 Section 3.03. Powers. Each Committee, except as otherwise provided in this section, shall have and may
exercise such powers of the Board of Directors as may be provided by resolution or resolutions of the Board of Directors. No Committee shall have the power or authority (a) to approve or adopt, or recommend to the stockholders, any action or
matter expressly required by the DGCL to be submitted to the stockholders for approval or (b) to adopt, amend or repeal the By–Laws of the Corporation. 
  

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 Section 3.04. Proceedings. Each Committee may fix its own rules of procedure and may meet at
such place (within or without the State of Delaware), at such time and upon such notice, if any, as it shall determine from time to time. Each Committee shall keep minutes of its proceedings and shall report such proceedings to the Board of
Directors at the meeting of the Board of Directors next following any such proceedings. 
 Section 3.05. Quorum and Manner of
Acting. Except as may otherwise be provided in the resolution creating a Committee, at all meetings of any Committee, the presence of members (or alternate members) constituting a majority of the total authorized membership of such Committee
shall constitute a quorum for the transaction of business. The act of the majority of the members present at any meeting at which a quorum is present shall be the act of such Committee. Any action required or permitted to be taken at any meeting of
any Committee may be taken without a meeting, if all members of such Committee shall consent to such action in writing or by electronic transmission and such writing, writings or electronic transmission or transmissions are filed with the minutes of
the proceedings of the Committee. Such filing shall be in paper form if the minutes are in paper form and shall be in electronic form if the minutes are maintained in electronic form. The members of any Committee shall act only as a Committee, and
the individual members of a Committee shall have no power in their individual capacities unless expressly authorized by the Board of Directors. 
 Section 3.06. Action by Telephonic Communications. Unless otherwise provided by the Board of Directors, members of any Committee may participate in a meeting of such Committee by means of conference telephone or other
communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this provision shall constitute presence in person at such meeting. 
 Section 3.07. Resignations. Any member (and any alternate member) of any Committee may resign at any time by delivering a notice of
resignation by such member to the Board of Directors or the Chairman of the Board. Unless otherwise specified therein, such resignation shall take effect upon delivery. 
 Section 3.08. Removal. Any member (and any alternate member) of any Committee may be removed at any time, either for or without cause, by resolution adopted by a majority of the entire Board of Directors.

 Section 3.09. Vacancies. If any vacancy shall occur in any Committee, by reason of disqualification, death, resignation,
removal or otherwise, the remaining members (and any alternate members) shall continue to act, and any such vacancy may be filled by the Board of Directors, provided that the CDR Designees shall have the right to designate any replacement for
a CDR Designee who is a member of a Committee upon the death, resignation, retirement, disqualification or removal from office of such member. 
  

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 ARTICLE IV 
 OFFICERS 
 Section 4.01. General. The officers of the Corporation shall consist of a
President, a Secretary and a Treasurer, and, if deemed necessary, expedient, or desirable by the Board of Directors, a Chairman of the Board, one or more Vice-Chairmen of the Board, a Chief Executive Officer, a Chief Financial Officer, one or more
Executive Vice-Presidents, one or more Group Vice-Presidents, one or more Senior Vice-Presidents or other Vice-Presidents, a Controller, a General Counsel, one or more Assistant Secretaries, one or more Assistant Treasurers and such other officers
with such titles as the resolution of the Board of Directors choosing them shall designate. Except as may otherwise be provided in the resolution of the Board of Directors, no officer other than the Chairman or a Vice-Chairman of the Board, if any,
need be a director. Any number of offices may be held by the same person, as the directors may determine. 
 Section 4.02. Term.
Unless otherwise provided in these By-Laws or in the resolution choosing him or her, each officer shall be chosen for a term which shall continue until the meeting of the Board of Directors following the next annual meeting of stockholders or until
his or her successor shall have been chosen and qualified. 
 Section 4.03. Duties. All officers of the Corporation shall have
such authority and perform such duties in the management and operation of the Corporation as shall be prescribed in the resolutions of the Board of Directors and shall have such additional authority and duties as are assigned to them from time to
time by the Chairman of the Board, Chief Executive Officer or President or are incident to their office, except to the extent that the authority and duties may be inconsistent with such resolutions. The Secretary or an Assistant Secretary of the
Corporation, or any director or officer of the Corporation acting, at the request of the Board of Directors or a Committee thereof, as secretary of such meeting, shall record all of the proceedings of all meetings and actions in writing of the
stockholders, Board of Directors, and Committees of the Board of Directors, and shall exercise such additional authority and perform such additional duties as the Board of Directors shall assign to him or her. 
 Section 4.04. Removal. Any officer may be removed, with or without cause, by the Board of Directors. Any vacancy in any office may be filled
by the Board of Directors. 
 Section 4.05. Action with Respect to Securities of Other Corporations. Unless otherwise directed by
the Board of Directors, the Chairman of the Board, the Chief Executive Officer, the President, any Vice-Chairman, or any Vice-President, or any other 
  

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 officer of the Corporation authorized by the Chairman of the Board, the Chief Executive Officer or President, shall have
power to vote and otherwise act on behalf of the Corporation, in person or by proxy, at any meeting of stockholders or equity holders or with respect to any action of stockholders or equity holders of any other corporation or entity in which the
Corporation may hold securities, and otherwise to exercise any and all rights and powers which the Corporation may possess by reason of its ownership of securities in such other corporation or entity, and to dispose of such securities. 

ARTICLE V 
 BOOKS, DOCUMENTS AND
ACCOUNTS 
 Section 5.01. Inspection of Books. The Board of Directors shall have power to keep the books, documents and
accounts of the Corporation outside of the State of Delaware, except as otherwise expressly provided by law. Except as authorized by the Board of Directors, or provided by law, no stockholder shall have any right to inspect any books, document or
account of the Corporation, and the Board of Directors may determine whether and to what extent and at what times and places and under what conditions and regulations the books, documents and accounts of the Corporation (other than the original
stock ledger), or any of them, shall be open to the inspection of stockholders. 
 ARTICLE VI 
 STOCK 
 Section 6.01. Stock
Certificates. Every holder of stock in the Corporation shall be entitled to have a certificate signed by, or in the name of the Corporation, by the Chairman of the Board, the President, a Vice-Chairman, or a Vice-President and the Treasurer or
an Assistant Treasurer, or the Secretary or an Assistant Secretary of the Corporation, certifying the number of shares owned by him or her in the Corporation. All signatures on any such certificate may be facsimiles. In case any officer or officers,
transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar, whether because of death, resignation or otherwise, before such
certificate is issued, such certificate or certificates may nevertheless be issued and delivered by the Corporation with the same effect as if the person or persons who signed such certificate or certificates or whose facsimile signature or
signatures have been used thereon had not ceased to be such officer, transfer agent, or registrar. 
 Section 6.02. Transfers.
Stock of the Corporation shall be transferable in the manner prescribed by law, unless otherwise restricted by agreement between any of the stockholders or any of the stockholders and the Corporation. 
  

 13 

 Section 6.03. Registered Holders. Except as otherwise restricted by agreement between any of
the stockholders or any of the stockholders and the Corporation, the Corporation shall be entitled to treat the Person in whose name any share of stock or any warrant, right or option is registered as the owner thereof for all purposes and shall not
be bound to recognize any equitable or other claim to, or interest in, such share, warrant, right or option on the part of any other Person, whether or not the Corporation shall have notice thereof, save as may be expressly provided otherwise by
law. Transfers of stock shall be made only upon the transfer books of the Corporation kept at an office of the Corporation or by a transfer agent or agents designated to transfer shares of the stock of the Corporation. 
 Section 6.04. New Certificates. The Corporation may issue a new certificate of stock in the place of any certificate theretofore issued by
it, alleged to have been lost or destroyed, and the Board of Directors or the President may, in their discretion, require the owner of the lost or destroyed certificate, or his or her legal representatives, to give the Corporation a bond sufficient
(in the sole judgment of the Board of Directors or the President, as the case may be) to indemnify the Corporation against any claim that may be made against it on account of the alleged loss of any such certificate or the issuance of such new
certificate. 
 ARTICLE VII 
 NOTICES 
 Section 7.01. Notices. Except as otherwise specifically provided herein or required by law, all
notices required to be given by the Corporation to any stockholder, officer, employee or agent shall be in writing and may in every instance be effectively given by hand delivery to the recipient thereof, by depositing such notice in the mail,
postage paid, or by sending such notice by prepaid telegram, courier such as Federal Express or Airborne Express, mailgram, telex, telecopy or facsimile transmission. Any such notice shall be addressed to such stockholder, officer, employee or agent
at his or her last known address as the same appears on the books of the Corporation. The time when such notice is received, if hand delivered or delivered by telegram, courier, mailgram, telex, telecopy or facsimile transmission shall be the time
of the giving of the notice. If mailed, such notice shall be deemed to be given when deposited in United States mail in a sealed envelope addressed to such Person at his or her address as it appears on the records of the Corporation with postage
paid thereon. Notices to directors shall be given in accordance with Section 2.10. 
 Section 7.02. Waivers. A written
waiver of any notice, signed by a stockholder, director, officer, employee or agent, whether before or after the time of the event for which notice is to be given, shall be deemed equivalent to the notice required to be given to such stockholder,
director, officer, employee or agent. Neither the business nor the purpose of any meeting need be specified in such a waiver. 
  

 14 

 Attendance at a meeting of stockholders, Board of Directors, or such Committees as may from time to time
be established, shall constitute a waiver of notice of such meeting, except when the stockholder, director or member of such Committee attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of
any business because the meeting is not lawfully called or convened. 
 ARTICLE VIII 
 INDEMNIFICATION 
 Section 8.01. Right to Indemnification. Each
Person who was or is made a party or is threatened to be made a party to or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “proceeding”), by reason of
the fact that he or she is or was a director or an officer of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to an employee benefit plan (hereinafter an “indemnitee”), whether the basis of such proceedings is alleged action in an official capacity as a director, officer, employee or agent or in
any other capacity while serving, at the request of the Corporation, as a director, officer, employee or agent, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the DGCL, as the same exists or may
hereafter be amended, against all expense, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such indemnitee in connection
therewith; provided, however, that, except as provided in Section 8.03 with respect to proceedings to enforce rights to indemnification, the Corporation shall indemnify any such indemnitee in connection with a proceeding initiated
by such indemnitee only if such proceeding was authorized by the Board of Directors of the Corporation. 
 Section 8.02. Right to
Advancement of Expenses. An indemnitee under Section 8.01 shall also have the right to be paid by the Corporation for expenses incurred in defending any such proceeding in advance of its final disposition (hereinafter an
“advancement of expenses”); provided, however, that, if the DGCL requires, an advancement of expenses incurred by an indemnitee in his or her capacity as a director or officer shall be made only upon delivery to the
Corporation of an undertaking (hereinafter an “undertaking”), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right
to appeal (hereinafter a “final adjudication”) that such indemnitee is not entitled to be indemnified for such expenses under this Article VIII or otherwise. 
 The rights to indemnification and to the advancement of expenses conferred in this Article VIII shall be contract rights and such rights shall continue
as to an indemnitee who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the indemnitee’s heirs, executors and administrators. 
  

 15 

 Section 8.03. Right of Indemnitee to Bring Suit. If a claim under this Article VIII is not
paid in full by the Corporation within 60 days after a written claim has been received by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be 20 days, the indemnitee may at any
time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. If successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of
an undertaking, the indemnitee shall be entitled to be paid also the expense of prosecuting or defending such suit. In any suit brought by the indemnitee to enforce a right to indemnification hereunder (but not in a suit brought by the indemnitee to
enforce a right to an advancement of expenses) it shall be a defense that the indemnitee has not met any applicable standard for indemnification set forth in the DGCL. Further, in any suit brought by the Corporation to recover an advancement of
expenses pursuant to the terms of an undertaking by a director or officer, the Corporation shall be entitled to recover such expenses upon a final adjudication that the indemnitee has not met any applicable standard for indemnification set forth in
the DGCL. Neither the failure of the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such suit that indemnification of the indemnitee has met
the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) shall create a presumption that the indemnitee has not met
the applicable standard of conduct or, in the case of such a suit brought by the indemnitee, be a defense to such suit. In any suit brought by the indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or
brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the burden of proving that the indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this Article VIII or
otherwise shall be on the Corporation. 
 Section 8.04. Non-Exclusivity of Rights. The rights to indemnification and to the
advancement of expenses conferred in this Article VIII shall not be exclusive of any other right which any Person may have or hereafter acquire under any statute, the Corporation’s Amended and Restated Certificate of Incorporation or By-Laws,
any agreement, any vote of stockholders or disinterested directors or otherwise. 
 Section 8.05. Insurance. The Corporation may
maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or
not the Corporation would have the power to indemnify such Person against such expense, liability or loss under the DGCL or otherwise. 
  

 16 

 Section 8.06. Indemnification of Employees and Agents of the Corporation. The Corporation
may, to the extent authorized from time to time by the Board of Directors, grant rights to indemnification and to the advancement of expenses to any employee or agent of the Corporation to the fullest extent of the provisions of this Article VIII
with respect to the indemnification and advancement of expenses of directors and officers of the Corporation. 
 Section 8.07.
Settlement of Claims. The Corporation shall not be liable to indemnify any indemnitee under this Article VIII (a) for any amounts paid in settlement of any action or claim effected without the Corporation’s written consent, which
consent shall not be unreasonably withheld or delayed; or (b) for any judicial award if the Corporation was not given a reasonably timely opportunity to participate, at its expense, in the defense of such action, but only to the extent that the
failure to give such notice prejudiced the Corporation’s ability to defend such action. 
 Section 8.08. Subrogation. In the
event of payment under this Article VIII, the Corporation shall be subrogated to the extent of such payment to all of the rights of recovery of the indemnitee, who shall execute all papers required and shall do everything that may be reasonably
necessary to secure such rights, including the execution of such documents reasonably necessary to enable the Corporation effectively to bring suit to enforce such rights. 
 Section 8.09. No Duplication of Payments. The Corporation shall not be liable under this Article VIII to make any payment in connection with
any claim made against the indemnitee to the extent the indemnitee has otherwise actually received payment (under any insurance policy, agreement, or otherwise) of the amounts otherwise indemnifiable hereunder. 
 ARTICLE IX 
 MISCELLANEOUS 

Section 9.01. Offices. The principal office or place of business of the Corporation in the State of Delaware will be in the City of
Wilmington, Delaware. The Corporation may also have offices at other places within and/or without the State of Delaware. 
 Section 9.02. Seal. The corporate seal shall have inscribed thereon the name of the Corporation, the year of its incorporation and the words “Corporate Seal Delaware.” 
 Section 9.03. Fiscal Year. The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors. 
  

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 Section 9.04. Dividends. Subject to any applicable provisions of law and the Amended and
Restated Certificate of Incorporation, dividends upon the shares of the Corporation may be declared by the Board of Directors and any such dividend may be paid in cash, property, or shares of the Corporation’s capital stock. 
 A member of the Board of Directors, or a member of any Committee designated by the Board of Directors shall be fully protected in relying in good faith
upon the records of the Corporation and upon such information, opinions, reports or statements presented to the Corporation by any of its officers or employees, or Committees of the Board of Directors, or by any other Person as to matters the
Director reasonably believes are within such other Person’s professional or expert competence and who has been selected with reasonable care by or on behalf of the Corporation, as to the value and amount of the assets, liabilities and/or net
profits of the Corporation, or any other facts pertinent to the existence and amount of surplus or other funds from which dividends might properly be declared and paid. 
 Section 9.05. Reserves. There may be set aside out of any funds of the Corporation available for dividends such sum or sums as the Board of Directors from time to time, in its absolute discretion, thinks
proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the Corporation or for such other purpose as the Board of Directors shall think conducive to the interest of the
Corporation, and the Board of Directors may similarly modify or abolish any such reserve. 
 Section 9.06. Execution of
Instruments. The Board of Directors may authorize, or provide for the authorization of, officers, employees or agents to enter into any contract or execute and deliver any instrument in the name and on behalf of the Corporation. Any such
authorization may be general or limited to specific contracts or instruments; and unless so authorized by the Board of Directors or by these By-Laws, no officer, agent, or employee shall have any power or authority to bind the Corporation by any
contract or engagement or to pledge its credit or to render it liable for any purpose or in any amount. 
 Section 9.07. Corporate
Indebtedness. No loan shall be contracted on behalf of the Corporation, and no evidence of indebtedness shall be issued in its name, unless authorized by the Board of Directors. Such authorization may be general or confined to specific
instances. Loans so authorized may be effected at any time for the Corporation from any bank, trust company or other institution, or from any firm, corporation or individual. All bonds, debentures, notes and other obligations or evidences of
indebtedness of the Corporation issued for such loans shall be made, executed and delivered as the Board of Directors shall authorize. When so authorized, any part of or all the properties, including contract rights, assets, business or good will of
the Corporation, whether then owned or thereafter acquired, may be mortgaged, pledged, hypothecated or conveyed or assigned in trust as security for the payment of such bonds, 
  

 18 

 debentures, notes and other obligations or evidences of indebtedness of the Corporation, and of the interest thereon, by
instruments executed and delivered in the name of the Corporation. 
 Section 9.08. Deposits. Any funds of the Corporation may be
deposited from time to time in such banks, trust companies or other depositaries as may be determined by the Board of Directors, the Chairman of the Board or the Chief Executive Officer, or by such officers or agents as may be authorized by the
Board of Directors, the Chairman of the Board or the Chief Executive Officer to make such determination. 
 Section 9.09. Checks.
All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such agent or agents of the Corporation, and in such manner, as the Board of Directors, the Chairman of the Board or the Chief Executive
Officer from time to time may determine. 
 Section 9.10. Sale, Transfer, etc. of Securities. To the extent authorized by the
Board of Directors, the Chairman of the Board or by the Chief Executive Officer, the President, any Vice President, the Secretary or the Treasurer or any other officers designated by the Board of Directors, the Chairman of the Board or the Chief
Executive Officer may sell, transfer, endorse, and assign any shares of stock, bonds or other securities owned by or held in the name of the Corporation, and may make, execute and deliver in the name of the Corporation, under its corporate seal, any
instruments that may be appropriate to effect any such sale, transfer, endorsement or assignment. 
 Section 9.11. Amendment of
By-Laws. Subject to the provisions of the Amended and Restated Certificate of Incorporation, these By-Laws may be altered, amended or repealed at any meeting of the stockholders (provided such matter is properly brought before the meeting
in accordance with Section 1.06) or by the Board of Directors. 
 Section 9.12. Section Headings. The headings of the
Articles and Sections of these By-Laws are inserted for convenience or reference only and shall not be deemed to be a part thereof or used in the construction or interpretation thereof. 
  

 19Employment Agreement

 Exhibit 10.1 
 PMC-SIERRA, INC. 
 EMPLOYMENT AGREEMENT 
 This Employment Agreement (“Agreement”) is made by and between PMC-Sierra, Inc. (“Company”) and Alan Krock (jointly referred to as
the “Parties”). 
 WHEREAS, Employee entered into an Invention Assignment Agreement with the Company on November 11, 2002 (the
“Invention Assignment Agreement”); 
 WHEREAS, Employee entered into a Conflict of Interest Agreement with the Company on
November 11, 2002 (the “Conflict of Interest Agreement”); 
 WHEREAS, the Company and Employee entered into a Stock Option
Agreement granting Employee the option to purchase shares of the Company’s common stock (the “Option”) subject to the terms and conditions of the Company’s 1994 Incentive Stock Plan and the Stock Option Agreement (jointly the
“Stock Option Agreements”); 
 WHEREAS, The Company and Employee entered into an Indemnification Agreement on November 11,
2002 (the Indemnification Agreement); and 
 WHEREAS, the Company and Employee have agreed to change the terms of Employee’s employment
and to terminate Employee’s employment no later than twelve months after the Company designates another employee as Chief Financial Officer or Interim Chief Financial Officer. 
 NOW THEREFORE, in consideration of the promises made herein, the Parties hereby agree as follows: 
 COVENANTS 
 1. Continuing
Employment. 
 (a) Initial Terms. 
 i. Position and Duties. Upon the Effective Date of this Agreement, Employee will continue to serve as the Company’s Chief
Financial Officer. Employee shall report to the Company’s Chief Executive Officer. Employee shall perform those duties and responsibilities assigned to him by the Chief Executive Officer. Employee shall devote his attention to the business and
affairs of the Company and shall use his best efforts to perform his responsibilities faithfully and efficiently. Employee is permitted to accept other employment arrangements, Board of Director assignments and consulting assignments in addition to
employment with the Company. 
 ii. Compensation and Benefits. The Company shall continue to pay Employee a base salary
at the annual rate of $265,000, less applicable withholdings, in accordance with the 

 Company’s regular payroll practices. Employee shall continue to be eligible to participate in the
Company’s health insurance plans and to accrue vacation on the same terms, schedule and conditions as previously. Employee shall be eligible to participate in the Company’s Short Term Incentive Plan (“STIP”) and Evergreen Stock
Option Grants (Evergreen), to receive other bonuses and additional stock option grants, and to participate in all other benefits or incidents of employment. As additional consideration for Employee agreeing to continue to serve as Chief Financial
Officer, for any quarter or partial quarter in which Employee holds that title, Employee shall be entitled to receive payment for the full quarter of not less than the average STIP award provided to the other current non-CEO Section 16
executive officers of the Company for that quarter. Subject to the above, Company and Employee agree that Employee will be entitled to no less then a minimum quarterly bonus of Forty Thousand Dollars ($40,000) for Q4 2006 and Q1 2007, provided that
Employee is still employed by the Company in the capacity of Chief Financial Officer during any portion of the respective quarter. 
 iii. Compliance with Agreements and Policies. Employee shall continue to comply with his Conflict of Interest Agreement and Invention Assignment Agreement with the Company, as well as other relevant Company policies, throughout his
employment with the Company and thereafter as provided in the relevant Agreements and policies. The Company shall comply with the Indemnification Agreement. 
 (b) Change in Terms Upon Appointment of New or Interim CFO. 
 i. Duration of Chief Financial Officer Position. The Company and Employee hereby agree that Employee will cease serving in the
capacity of Chief Financial Officer to the Company upon the earlier of: (i) the appointment of a new Chief Financial Officer or Interim Chief Financial Officer (the “Successor CFO”); (ii) the filing of the 2006 10K; or
(iii) March 15, 2007 (collectively the “Change of Position Events”). 
 ii. Position and Duties.
The Parties hereby acknowledge and agree that the Employee’s duties as Chief Financial Officer will include signing and certifying the Company’s 2006 10-K. Immediately following a Change of Position Event, the Parties agree that Employee
will transition into the position of Vice President Corporate Affairs. In the position of Vice President Corporate Affairs, Employee will assist in the transition of the Successor CFO. Employee’s duties as Vice President Corporate Affairs will
include the performance of duties consistent with those of a senior financial manager. During Employee’s employment as Vice President Corporate Affairs, the Parties agree that the Company will retain the right to change employee’s
reporting structure and duties, provided that they are consistent with his role as a senior financial manager and in accordance with the Company’s business needs. To the extent that Employee remains employed by the Company following the
appointment of a new Chief Financial Officer or Interim Chief Financial Officer, Employee shall work from his home office. 
 iii. Compensation and Benefits. Upon the appointment of a new Chief Financial Officer or Interim Chief Financial Officer, Employee shall no longer be eligible to participate in the STIP or Evergreen Stock Option Grants, or to receive
any other bonuses or additional 
  

 -2- 

 stock option grants, except to the extent that Employee remains in the Chief Financial Officer position
and is eligible for a STIP award as provided in section 1(a)(iii), above. To the extent that Employee continues his employment with the Company after the appointment of a new Chief Financial Officer or Interim Chief Financial Officer, he shall
continue to vest in the shares subject to the Option on the same terms, conditions, and schedule as previously, and he will remain eligible to participate in the Company’s health insurance plans and to accrue vacation on the same terms,
schedule and conditions as previously. The shares subject to the Option shall continue to be subject to and governed by the Stock Option Agreements. 
 (c) Reduction in Base Salary upon Acceptance of Other Employment. The Company shall continue to pay Employee a base salary at the annual rate of $265,000, less applicable withholdings, in accordance with the
Company’s regular payroll practices, until Employee accepts full-time employment elsewhere, at which time the Company shall reduce Employee’s base salary to the annual rate of $53,000, less applicable withholdings. The Company shall pay
Employee his base salary, either at the initial rate or at the reduced rate, as applicable, until the first of the following events occurs: (i) the twelve-month anniversary of any of the Change of Position Events (as defined in this Agreement);
(ii) Employee resigns from his employment with the Company; or (iii) the Company terminates Employee’s employment for “Cause”, as that term is defined below. 
 2. Termination. If, prior to the twelve-month anniversary of the appointment of the new Chief Financial Officer or Interim Chief Financial
Officer, Employee resigns, or the Company terminates Employee’s employment for Cause, as that term is defined herein, then Employee shall be entitled only to the wages he has earned as of the date of the termination of his employment, including
compensation for any accrued vacation, and authorized business expenses incurred to date, and he shall not be entitled to any further compensation or benefits or any severance from the Company. For purposes of this Agreement, Cause is defined as any
of the following: (i) Employee’s conviction of or plea of nolo contendre to a felony; (ii) Employee’s death; (iii) Employee’s inability to perform the essential functions of his position with or without
reasonable accommodation; (iv) willful misconduct by Employee; (v) Employee’s failure to perform his duties as assigned by the Company’s Chief Executive Officer, which is not cured by Employee to the Company’s Chief
Executive Officer’s satisfaction within 30 days of receiving written notice from him or her of any deficiency; or (vi) Employee’s breach of any provision of this Agreement, the Invention Assignment Agreement, or the Conflict of
Interest Agreement. 
 3. Preserving Confidential Information and Returning Company Property. Employee shall continue to comply with
the terms of the Invention Assignment Agreement and shall maintain the confidentiality of all of the Company’s confidential and proprietary information. Employee also shall return to the Company all of the Company’s property, including all
Company-issued equipment, all confidential and proprietary information belonging to the Company, and all documents and information that Employee obtained in connection with his employment with the Company, on the last day of his employment with the
Company. 
 4. No Representations. Each party represents that it has consulted with an attorney, and has carefully read and
understands the scope and effect of the provisions of this Agreement. Neither party has relied upon any representations or statements made by the other party hereto which are not specifically set forth in this Agreement. 
  

 -3- 

 5. Attorneys’ Fees. In the event that either Party brings an action to enforce or effect its
rights under this Agreement, the prevailing party shall be entitled to recover its costs and expenses, including the costs of mediation, arbitration, litigation, court fees, plus reasonable attorneys’ fees, incurred in connection with such an
action. 
 6. Severability. In the event that any provision hereof becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement will continue in full force and effect without said provision. 
 7. No Oral
Modification. This Agreement may only be amended in writing signed by Employee and the Chief Executive Officer of the Company. 
 8.
Costs. The Parties shall each bear their own costs, expert fees, attorneys’ fees and other fees incurred in connection with the preparation of this Agreement. 
 9. Integration. This Agreement, together with the Stock Option Agreements, the Invention Assignment Agreement, the Conflict of Interest Agreement, and the Indemnity Agreement represents the entire agreement and
understanding between the Parties concerning Employee’s employment with and termination from the Company and supersedes all prior and contemporaneous agreements, whether written or oral. 
 10. Governing Law. This Agreement shall be deemed to have been executed and delivered within the State of California, and it shall be construed,
interpreted, governed, and enforced in accordance with the laws of the State of California, without regard to choice of law principles. 
 11. Effective Date. This Agreement is effective when it has been signed by both Parties (the “Effective Date”). 
 12. Counterparts. This Agreement may be executed in counterparts, and each counterpart shall have the same force and effect as an original and shall constitute an effective, binding agreement on the part of each of the undersigned.

 13. Voluntary Execution of Agreement. This Agreement is executed voluntarily and without any duress or undue influence on the part
or behalf of the Parties hereto, with the full intent of releasing all claims. The Parties acknowledge that: 
 (a) They have read this
Agreement; 
 (b) They have been represented in the preparation, negotiation, and execution of this Agreement by legal counsel of their own
choice or that they have voluntarily declined to seek such counsel; 
 (c) They understand the terms and consequences of this Agreement and
of the releases it contains; and 
  

 -4- 

 (d) They are fully aware of the legal and binding effect of this Agreement. 
 IN WITNESS WHEREOF, each of the Parties has executed this Agreement, in the case of the Company by their duly authorized officers, as of the day and year
first above written. 
  

									
	COMPANY:	 		 		 	
				
	PMC-Sierra, Inc.	 		 		 	
					
	By:	 	  
	 		 	Date:	 	  

				
	Bob Bailey, Chairman & CEO	 		 		 	
				
	EMPLOYEE:	 		 		 	
				
	  
	 		 	Date:	 	  

	Alan Krock	 		 		 	

  

 -5-

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