8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): September 5, 2008

EMULEX CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	001-31353	51-0300558
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

3333 Susan Street
Costa Mesa, California 92626
(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (714) 662-5600

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

EXHIBIT 10.1

EXHIBIT 10.2

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) Amendment to Executive Bonus Plan

On September 5, 2008, the Compensation Committee of the Board of Directors of Emulex Corporation (the “Company”) approved certain amendments to the Emulex Corporation Executive Bonus Plan (as amended, the “Bonus Plan”) and established the Bonus Plan participants for fiscal 2009. The Bonus Plan is intended to provide incentives to corporate officers, executive officers, operating officers, senior vice presidents, vice presidents and senior directors in the form of quarterly cash bonus payments based on Company performance against net revenue and net operating income targets established periodically and, in certain circumstances, other specified business goals. Actual goals for measurement purposes are the Company’s fiscal annual operating plan that is approved by the Board of Directors. In addition, a discretionary bonus for recognition of extraordinary contributions to the success of the company may be recommended by the Chief Executive Officer. All bonus recommendations are subject to the approval of the Compensation Committee.

     Each participant in the Bonus Plan has a quarterly target award opportunity expressed as a percentage of quarterly gross base salary at the end of the quarter in question. The quarterly target award opportunity for participants range from 10% to 90% of quarterly base salary (the “target award percentage”). Target award percentages for executive officers generally range from 50% to 90%.

     Each participant’s quarterly bonus is weighted based upon achieving a combination of corporate performance goals. For example, 45% of an executive officers bonus may be based upon achievement of net revenue performance goals with the remaining 55% of the bonus based on achievement of net operating income performance. Targeted quarterly bonuses are further adjusted by application of an accelerator formula pursuant to which bonuses are increased to reward for over-achievement of targets and decreased to minimize bonus payments for performance below targeted levels. For example, if quarterly net revenue is 10% more than targeted net revenue, the bonus attributable to achievement of net revenue targets for such quarter will generally be 15 percent above the targeted bonus amount. Similarly, if quarterly revenue is 10% less than targeted net revenue, the bonus attributable to achievement of net revenue targets for such quarter will be decreased by 15% percent from the targeted bonus amount.

     Net revenue and net operating income bonuses are treated separately regardless of the award formula. However, no net revenue bonus or net operating income bonus will be paid for a given quarter unless at least 80% of the corresponding net revenue or net operating income goal, as the case may be, is achieved. In addition, no bonus payout of any kind shall be made if net operating income is less than 50% of the applicable net operating income goal.

     In addition to the components based on net revenue and net operating income, a participant’s cash award may be adjusted by a Performance Contribution Factor (PCF) which represents the level of the employee’s contribution to the company’s results for the quarter based on the objectives set forth for that participant at the beginning of the quarter. The payment made to the participant will be the bonus amount multiplied by the PCF. The PCF can range from 0.9 to 1.1 but PCF’s other than 1.0 will generally only be applied as an exception.

     A participant must be an employee for the entire quarter to be eligible for a quarterly bonus. Quarterly bonuses are generally paid 30 days following the end of each quarter. Award formulas under the Bonus Plan are established for a fiscal year and may be modified, extended, or canceled annually at the discretion of the Compensation Committee.

Correction of Summary of Executive Compensation Arrangements.

     As previously disclosed in the Company’s Current Report on Form 8-K filed on August 28, 2008 (the “Prior Form 8-K”), the Compensation Committee of the Board of Directors of the Company increased the annual base salaries of its named executive officers and eliminated certain benefits for such officers. The Prior Form 8-K contained certain incorrect information regarding base salaries and eliminated benefits. Attached as Exhibit 10.2 to this Form 8-K and incorporated herein by this reference is a corrected summary of the amended compensation of the named executive officers that reflects the modification necessary to correct the information contained in the Prior Form 8-K: (i) the base salary of Marshall Lee is now correctly listed as $328,520, (ii) the base salary of Michael Rockenbach is now correctly listed as $366,978, (iii) the $2,500 per year tax preparation reimbursement is now correctly reflected as an eliminated benefit, and (iv) the $5,000 per year out of pocket health care expense reimbursement is now correctly reflected as a continuing benefit. The attached Exhibit 10.2 replaces Exhibit 10.1 to the Prior Form 8-K.

Item 9.01 Financial Statements and Exhibits

     (c) Exhibits

Exhibit Number	Exhibit Title or Description
10.1	Executive Bonus Plan of Emulex Corporation, as amended
10.2	Amended Description of Compensation Arrangements for Certain Executive Officers

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	EMULEX CORPORATION
	(Registrant)
Date: September 10, 2008	By:	/s/ James M. McCluney
	James M. McCluney,
	Chief Executive Officer and President

EXHIBIT INDEX

Exhibit Number	Exhibit Title or Description
10.1	Executive Bonus Plan of Emulex Corporation, as amended
10.2	Amended Description of Compensation Arrangements for Certain Executive Officers

EX-10.1

Exhibit 10.1

EMULEX CORPORATION
EXECUTIVE BONUS PLAN

Plan Purpose

To focus members of the management team on the achievement of specific Company and individual accomplishments that contribute to the creation of shareholder value.

To assist in attracting and retaining top quality management.

General Plan Description

This Executive Bonus Plan (“Plan”) provides for a quarterly cash award based upon Company performance against net revenue and net operating income plan goals and specified business goals. In addition, a discretionary bonus for recognition of extraordinary contributions to the success of the company may be recommended. All bonus recommendations are subject to the approval of the Compensation Committee.

Eligibility

Corporate officers, executive officers, operating officers, senior vice presidents, vice presidents, and senior directors, excluding those eligible for sales commission (unless otherwise indicated within this Plan), are eligible for selection to participate in this Plan. A participant must be an active regular full-time employee throughout the quarter for which the bonus is paid, and no proration will be made of any payment for employment during portions of a quarter. Participants whose employment is terminated for “cause” (as defined below) are not eligible for any bonus payments even if the termination occurs following the end of a quarter for which a bonus otherwise would be paid.

Participation and Term

Actual Executive Bonus Plan participants will normally be selected from among those eligible annually, prior to the start of each fiscal year, by the Chief Executive Officer and approved by the Compensation Committee. The Plan is based on a fiscal year and may be modified, extended, or canceled annually at the discretion of the Compensation Committee.

Target Bonus Opportunity

Each eligible participant will be assigned a Target Award Opportunity expressed as a percentage of their actual gross quarterly base salary in effect at the end of the respective quarter. The Target Award Opportunity for:

[Category 1] is 90%
[Category 2] is 70%
[Category 3] is 60%
[Category 4] is 50%
[Category 5] is 45%
[Category 6] is 35%
[Category 7] is 10%

Bonus Award Criteria

Bonus award criteria will be based upon achieving a combination of corporate performance goals.

The weighting factors are:

	Category 1, 2, 4, 5, 6, 7, and 8			Category 3
Net revenue		45	%		50	%
Net operating income		55	%		50	%

The actual goals for measurement purposes will be the Company’s fiscal Annual Operating Plan (AOP) as approved by the Board of Directors. Corporate bonus components will be calculated according to the following procedure:

1. The Target Award Opportunity times the participant’s quarterly gross base salary equals the Target Award.

Example : 35% x $25,000 (quarterly salary) = $8,750 Target Award

2. The weighting factors for net revenue, net operating income, and subjective as stated above times the Target Award give the bonus target for each weighting factor.

Example :	45% x $8,750 = $3,938.00 (net revenue target)
	55% x $8,750 = $4,812.00 (net operating income target)

3. An accelerator formula of 1.5 x % of performance less 50% will be used for each part of the quantitative bonus award calculation to reinforce over-achievement opportunity as well as to minimize any bonus payments for performance below fiscal AOP planned levels.

     Using the Example if the first quarter performance is 105% of net revenue and 110% of net income:

(105% x 1.50) less 50% = 157.5% — 50% = 107.5% of net revenue target:

107.5% x $3,938.00 = $4,233.35 net revenue bonus component

(110% x 1.50) less 50% = 165% — 50% = 115% of net operating income target:

115% x $4,812.00 = $5,533.80 net operating income bonus component

               total first quarter bonus components = $9,767.15.

Using the Example if the second quarter performance is 90% of net revenue and 80% of net
operating income:

(90% x 1.50) less 50% = 135% — 50% = 85% of net revenue target:

85% x $3,938.00= $3,347.30 net revenue bonus component

(80% x 1.50) less 50% = 120% — 50% = 70% of net operating income target:

70% x $4,812.00 = $3,368.40 net operating income bonus component

               total second quarter bonus components = $6,715.70

4. Net revenue and net operating income will be treated as separate components independent of one another regardless of the award formula, and will be added to compute the cash award. However, a minimum threshold of 80% of the Board of Directors’ approved AOP for net revenue must be achieved for a net revenue bonus component to be included in the cash award. Likewise, a minimum threshold of 80% of the Board of Directors’ approved AOP for net operating income must be achieved for a net operating income component to be included in the cash award. No cash award of any kind shall be made if net operating income falls below 50% of the AOP approved plan.

5. In addition to the components based on net revenue and net operating income, a participant’s cash award may be adjusted by a Performance Contribution Factor (PCF) which represents the level of the employee’s contribution to the company’s results for the quarter, and the payment made to the participant shall be the cash award multiplied by the PCF. The PCF will be determined by the Company, and can range from 0.9 to 1.1, and a PCF other than 1.0 should be applied on an exception basis. The PCF for a participant will be based on the objectives set for that participant at the beginning of the quarter, and the participant’s progress against those objectives as discussed with his or her manager. If a participant receives a PCF of 0.9, he or she should also be on a performance improvement plan.

Discretionary Bonuses

Occasionally, an individual makes an extraordinary contribution to the success of the company, a contribution that deserves special recognition and financial reward. It is the intention of this “Discretionary Bonus” provision to provide the CEO with the latitude to recommend unusual bonus payments to be made to such contributors when they occur. Such bonus recommendations are not subject to the guidelines of the Plan described above, but are subject to the review and prior approval of the Compensation Committee.

Payment of Awards

Any proposed awards by the CEO must be reviewed and approved by the Compensation Committee.

Awards will be paid approximately 30 days following the end of each quarter. All legally required deductions will be withheld.

Plan Administration

The Plan will be administered under the direction of the CEO of Emulex Corporation upon approval by the Emulex Compensation Committee. The administrator’s authority will include, but not be limited to:

Final approval of Plan participants, corporate performance goals, award opportunity and award payment.

Interpretation of all rules pertaining to the Plan.

Changes to the Plan or termination of the Plan, provided such changes or termination do not adversely affect the award opportunity or difficulty of earning awards following the beginning of the fiscal year.

Treatment of special events in calculating performance versus plan, such as a major acquisition or changes in accounting regulations.

Plan Term

This Plan will become effective on the first day of the fiscal year and end on the last day of the fiscal year.

Foreign Currency Considerations

All Plan participants whose gross base salary is not denominated in U.S. dollars will be paid in the same currency as their gross base salary. All bonus calculations will be made using the equivalent base salary in US currency as indicated in the most recent payroll information.

Definitions

Active Regular Full-time Employee: An employee working 40 hours per week.

Gross Base Salary: An employee’s base salary, and does not include payments for overtime, bonus payments of any type, or other income such as relocation allowances, employee referral payments, etc.

Net Revenue: Net revenue as presented in the Company’s consolidated financial statements.

Net Operating Income: Operating income as presented in the Company’s consolidated financial statements, excluding amortization, impairment of intangibles, bonus payments, profit sharing payments, retirement savings plan payments, share based compensation, severance payments, and worker’s compensation payments.

Termination for Cause: Termination of employment as a result of violation of one or more written or unwritten Company policies, procedures, principles or rules regarding employee conduct and behavior. If an employee is terminated for cause prior to payment of a quarterly bonus, the employee will not be eligible for the payment. Nothing in this Plan shall alter the at-will employment relationship between the Company and its employees. Either the Company or the employee may terminate the employment relationship at any time, for any reason or no reason, with or without any cause.

Approved by Compensation Committee:

Bruce C. Edwards	Date
Don M. Lyle	Date
Approved by CEO:
James McCluney	Date

EX-10.2

Exhibit 10.2

EMULEX CORPORATION

Amended Description of Compensation Arrangements for Certain Executive Officers
(September 1, 2008)

          The following is a description of the compensation arrangements for each of the Company’s named executive officers listed in the Company’s Proxy Statement for the 2007 Annual Meeting of Stockholders of Emulex Corporation, excepting for Mr. Michael E. Smith, who ceased to be an employee of the Company on July 18, 2008. The compensation for these executive officers consists of base salary and perquisites, long-term incentive compensation and annual cash bonus compensation. Effective September 1, 2008, the following are the base salaries (on an annual basis) of the Company’s named executive officers (as well as of Jeffrey W. Benck, the Company’s current Executive V.P. and Chief Operating Officer, who does not currently meet the definition of a named executive officer due to the fact that his employment with the Company did not commence until May 2008):

Name and Principal Position	New Base Salary
Paul F. Folino, Executive Chairman	$	603,827
James M. McCluney Chief Executive Officer and President	$	585,750
Jeffrey W. Benck Executive V.P. and Chief Operating Officer	$	412,110
Michael J. Rockenbach Executive V.P. and Chief Financial Officer	$	366,978
Marshall D. Lee Executive V.P. Engineering	$	328,520

         Perquisites for each of the named executive officers include an out of pocket health care expense reimbursement of up to $5,000 per year. Effective on September 1, 2008, the Company eliminated reimbursement of tax preparation expenses of up to $2,500 per year for each of the named executive officers. In addition, reimbursement for the following other compensation amounts were eliminated: (a) for Mr. Folino, an automobile allowance of $10,800 per year; (b) for Mr. McCluney, an automobile allowance of $ 10,800 per year; (c) for Mr. Benck, an automobile allowance of $9,600 per year; (d) for Mr. Rockenbach, an automobile allowance of $9,600 per year; and (e) for Mr. Lee, an automobile allowance of $9,600 per year.

          The Company does not have employment agreements with any of its executive officers but has executed key employee retention agreements with each of its named executive officers and certain other officers and key employees of the Company. The Company’s agreement with

Mr. Folino entitles him to receive the following payments and benefits in the event of termination of his employment by the Company without cause or by Mr. Folino because of a demotion (as defined in such agreement) within 2 years after a change in control of the Company: (i) a severance payment equal to the present value of 2 times the sum of Mr. Folino’s annual salary plus the highest annual average of any 2 of his last 3 annual bonuses; (ii) continuation for 2 years following termination of employment of his health and life insurance, and disability income (reduced to the extent similar benefits are received by him from another employer); and (iii) acceleration of his right to exercise his stock options and vesting of any restricted stock awards based on the length of his continued employment following the grant of the option by one year upon the change in control of the Company and full acceleration of such option exercise right and vesting of restricted stock awards in the event of termination of his employment without cause or because of a demotion (as defined in such agreement) within two years after the change in control.

          Mr. McCluney’s key employee retention agreement is substantially the same as Mr. Folino’s agreement described above. Additionally, in the event that Mr. McCluney is terminated without cause (regardless of whether a change in control has occurred), he will be entitled to severance in the amount of one year’s base salary at the rate then in effect, any deferred incentive bonuses, reimbursement of COBRA premiums, if any, for one year, and continued vesting of his stock options for one year.

          The above descriptions are qualified in their entirety by the forms of Key Employee Retention Agreements for Mr. Folino and Mr. McCluney which are incorporated herein by reference to Exhibits 10.2 and 10.1, respectively, to the Company’s Current Report on Form 8-K filed on September 6, 2006.

          The Company also has entered into similar agreements with each of the other named executive officers (as well as Mr. Benck) which provide for benefits similar to those described above, except that the severance payment is equal to the present value of one times the sum of the employee’s annual salary plus the highest annual average of any 2 of the employee’s last 3 annual bonuses; and continuation for one year following termination of employment of the employee’s health and life insurance, disability income and tax assistance (reduced to the extent similar benefits are received by the employee from another employer). The form of key employee retention agreement for each of the other named executive officers is filed as Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2006.

          Additionally, the Company’s executive officers are entitled to participate in health and welfare and retirement plans, perquisite, fringe benefit and other arrangements generally available to other salaried employees. In addition, each officer is entitled to participate in the Emulex Corporation Retirement Savings Plan, and receives group term life insurance premiums and health care reimbursement paid with respect to the named executive.

          The Company’s executive officers are eligible for annual performance-based cash bonuses under the Company’s Executive Bonus Plan. A description of the Executive Bonus Plan is contained in Item 5.02 of the Company’s Current Report on Form 8-K of which this Exhibit 10.2

is a part. Such description is qualified in its entirety by the Executive Bonus Plan which is filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K of which this Exhibit 10.2 is a part.

          Long term incentives are provided to the Company’s executives in accordance with the Company’s 2005 Equity Incentive Plan which is attached as Appendix A to the Company’s Definitive Proxy Statement for the Annual Meeting of Stockholders held on November 15, 2007, as such plan may be amended from time to time. In addition, the Company’s executive officers have previously received options pursuant to option or other equity plans maintained by the Company prior to the adoption of the 2005 Equity Incentive Plan in 2005.