NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Overview, Basis of Presentation and Significant Accounting Policies

Overview

Broadcom Limited, a company organized under the laws of the Republic of Singapore, is the successor to Avago Technologies Limited, or Avago. On February 1, 2016, pursuant to an Agreement and Plan of Merger dated as of May 28, 2015, or the Broadcom Agreement, Broadcom Limited, Avago, Broadcom Corporation, or BRCM, and various other parties consummated a scheme of arrangement and certain merger transactions, as a result of which Avago and BRCM became indirect subsidiaries of Broadcom Limited, or the Broadcom Transaction. Pursuant to the scheme of arrangement under Singapore law, or the Avago Scheme, all issued ordinary shares of Avago were exchanged on a one -for-one basis for newly issued ordinary shares of Broadcom. Immediately following the consummation of the Avago Scheme, two subsidiaries of Broadcom Limited merged with and into BRCM with BRCM as the surviving corporation of each such merger, or the Broadcom Merger.

The Avago Scheme will be accounted for in all periods presented using a carryover basis, similar to a pooling-of-interests, as the transaction was premised on a non-substantive exchange in order to facilitate the acquisition of BRCM, resulting in the retention of the historical basis of accounting. Under this method of accounting, Broadcom Limited and Avago will be treated as if they had always been combined for accounting and financial reporting purposes. The Broadcom Transaction is discussed in further detail in Note 12. "Subsequent Events".

References to "Broadcom," "the Company," "we," "our," and "us" are to Broadcom Limited and its consolidated subsidiaries, from and after the effective date of the Broadcom Transaction and, prior to that time, to our predecessor, Avago, unless otherwise specified or the context otherwise requires.

We are a leading designer, developer and global supplier of a broad range of analog and digital semiconductor connectivity solutions with a focus on analog III-V based products and complex digital and mixed signal complementary metal oxide semiconductor based devices. We have a history of innovation and offer thousands of products that are used in end products such as data center networking, home connectivity, broadband access, telecommunications equipment, smartphones and base stations, data center servers and storage, factory automation, power generation and alternative energy systems, and displays. We have four reportable segments: enterprise storage, wireless communications, wired infrastructure and industrial & other, which align with our principal target markets.

Basis of Presentation

This is the first Quarterly Report on Form 10-Q, or Form 10-Q, following the Broadcom Transaction. However, as the first fiscal quarter of 2016 ended prior to the completion of the Broadcom Transaction, financial information and results of operations presented in this Form 10-Q are related to the predecessor, Avago.

We operate on a 52- or 53-week fiscal year ending on the Sunday closest to October 31. Our fiscal year ending October 30, 2016 , or fiscal year 2016 , is a 52-week fiscal year. The first quarter of our fiscal year 2016 ended on January 31, 2016, the second quarter ends on May 1, 2016 and the third quarter ends on July 31, 2016. Our fiscal year ended November 1, 2015 , or fiscal year 2015 , was also a 52-week fiscal year.

The accompanying unaudited condensed consolidated financial statements include the accounts of Avago and its wholly-owned subsidiaries and have been prepared by us in accordance with generally accepted accounting principles in the United States, or GAAP, for interim financial information. This financial information reflects all adjustments which are, in the opinion of our management, of a normal recurring nature and necessary for a fair statement of the results for the periods presented. The November 1, 2015 condensed consolidated balance sheet data were derived from Avago's audited consolidated financial statements included in Avago's Annual Report on Form 10-K for fiscal year 2015 , or 2015 Annual Report on Form 10-K, as filed with the Securities and Exchange Commission, or SEC, but do not include all disclosures required by GAAP. Intercompany transactions and balances have been eliminated in consolidation.

The operating results for the fiscal quarter ended January 31, 2016 are not necessarily indicative of the results that may be expected for fiscal year 2016 , or for any other future period.

Significant Accounting Policies

Use of estimates. The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates.

Concentrations of credit risk and significant customers. Our cash, cash equivalents and accounts receivable are potentially subject to concentration of credit risk. Cash and cash equivalents may be redeemable upon demand and are maintained with several financial institutions that management believes are of high credit quality and therefore bear minimal credit risk. We seek to mitigate our credit risks by spreading such risks across multiple counterparties and monitoring the risk profile of these counterparties. Our accounts receivable are derived from revenue earned from customers located around the world. We seek to mitigate collection risks from our customers by performing regular credit evaluations of our customers' financial condition, and requiring collateral, such as letters of credit and bank guarantees, in certain circumstances.

We sell our products primarily through our direct sales force, distributors and manufacturers' representatives. Two direct customers accounted for 17% and 13% of our net accounts receivable balance at January 31, 2016 . One direct customer accounted for 33% of our net accounts receivable balance at November 1, 2015 . For the fiscal quarter ended January 31, 2016 , two direct customers represented 15% and 10% of our net revenue. For the fiscal quarter ended February 1, 2015 , one direct customer represented 27% of our net revenue. The majority of the revenue from these customers was included in our wireless communications segment.

Net income per share . Basic net income per share is computed using the weighted-average number of Avago ordinary shares outstanding during the period. Diluted net income per share is computed using the weighted-average number of Avago ordinary shares and potentially dilutive share equivalents outstanding during the period. Diluted shares outstanding include the dilutive effect of in-the-money share options, restricted share units, or RSUs, employee share purchase rights under the Amended and Restated Broadcom Limited Employee Share Purchase Plan, or ESPP, (together referred to as equity awards) and, for the fiscal quarter ended February 1, 2015, the 2.0% Convertible Senior Notes due 2021 issued by Avago, or the Convertible Notes. The dilutive effect of equity awards is calculated based on the average share price for each fiscal period, using the treasury stock method. Under the treasury stock method, the amount the employee must pay for exercising share options and to purchase shares under the ESPP, the amount of compensation cost for future service that we have not yet recognized, and the amount of tax benefits that would be recognized when equity awards become deductible for income tax purposes are collectively assumed to be used to repurchase ordinary shares.

The dilutive effect of the Convertible Notes was calculated using the treasury stock method based on our assumption that the Convertible Notes would be settled in cash. The treasury stock method assumed that the carrying value of the Convertible Notes represented proceeds, since settlement of the Convertible Notes tendered for conversion could be settled with cash, Avago ordinary shares or a combination of both at Avago's option.

During the third fiscal quarter of fiscal year 2015, the Convertible Notes were converted in full and settled with a combination of cash and the issuance of 13.8 million of Avago ordinary shares. The incremental Avago ordinary shares attributable to the conversion were a component of diluted shares for the period prior to settlement and a component of basic weighted-average Avago shares outstanding subsequent to the conversion.

There were no material antidilutive equity awards for the fiscal quarter ended January 31, 2016 or February 1, 2015 .

The following is a reconciliation of the numerators and denominators of the basic and diluted net income per share computations for the periods presented (in millions, except per share data):

	Fiscal Quarter Ended
	January 31, 2016				February 1, 2015
Net income (Numerator):
Income from continuing operations	$	377			$	338
Income from discontinued operations, net of income taxes	—				13
Net income	$	377			$	351
Shares (Denominator):
Basic weighted-average ordinary shares outstanding	277				255
Add incremental shares for:
Dilutive effect of share options, RSUs and ESPP rights	12				12
Dilutive effect of Convertible Notes	—				11
Shares used in diluted computation	289				278
Basic income per share:
Income per share from continuing operations	$	1.36			$	1.33
Income per share from discontinued operations, net of income taxes	$	—			$	0.05
Net income per share	$	1.36			$	1.38
Diluted income per share:
Income per share from continuing operations	$	1.30			$	1.22
Income per share from discontinued operations, net of income taxes	$	—			$	0.04
Net income per share	$	1.30			$	1.26

Supplemental cash flow disclosures. At January 31, 2016 and November 1, 2015 , we had $52 million and $78 million , respectively, of unpaid purchases of property, plant and equipment included in accounts payable. Amounts reported as unpaid purchases are presented as cash outflows from investing activities for purchases of property, plant and equipment in the condensed consolidated statements of cash flows in the period in which they are paid.

Reclassifications. Certain reclassifications have been made to the prior period condensed consolidated statement of cash flows. These reclassifications have no impact on previously reported net cash activities.

Recently Adopted Accounting Guidance

In November 2015, the Financial Accounting Standards Board, or FASB, issued authoritative guidance that simplifies the presentation of deferred tax assets and liabilities in a classified balance sheet. This guidance eliminates the current requirement to present deferred tax assets and liabilities as current and non-current in a classified balance sheet. Instead, all deferred tax assets and liabilities are classified as non-current. We adopted this guidance during the first fiscal quarter ended January 31, 2016 on a prospective basis. The adoption resulted in $116 million of net current deferred tax assets being reclassified from other current assets to other long-term assets on our condensed consolidated balance sheet.

Recent Accounting Guidance Not Yet Adopted

In February 2016, the FASB issued authoritative guidance related to the accounting for leases, which among other things, requires a lessee to recognize lease assets and lease liabilities on the balance sheet for operating leases. This guidance will become effective for the first quarter of our fiscal year 2020. The new guidance is required to be applied using a modified retrospective approach. We are currently evaluating the impact that this guidance will have on our consolidated financial statements.

In August 2015, the FASB deferred the effective date of the authoritative guidance that outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. This guidance will become effective for the first quarter of our fiscal year 2019. Early adoption is permitted, but not before the first quarter of our fiscal year 2018. The new guidance is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date

of initial application. We have not yet selected a transition method and are currently evaluating the impact of this guidance on our consolidated financial statements.

In April 2015, the FASB issued an amendment to the accounting guidance related to the financial statement presentation of debt issuance costs. The new guidance is required to be applied retrospectively to each prior reporting period presented. The guidance requires certain debt issuance costs to be presented on the balance sheet as a direct reduction to the carrying amount of debt, consistent with debt discounts or premiums. In August 2015, the FASB further clarified that entities are permitted to defer and present debt issuance costs related to line-of-credit arrangements as assets. This guidance will be effective for the first quarter of our fiscal year 2017, with early application permitted. The adoption of this guidance is not expected to have a material effect on our consolidated balance sheet presentation.

2. Supplemental Financial Information

Inventory

Inventory consists of the following (in millions):

Assets held-for-sale

The following table summarizes components of assets held-for-sale (in millions):

During the fiscal quarter ended January 31, 2016 , we completed the sale of certain fiber optics subsystem manufacturing and related assets. We recognized a $16 million loss related to the disposal of these assets in restructuring and disposal charges in our condensed consolidated statements of operations.

The net carrying amount of the fiber optics subsystem assets adjusted to fair value less costs to sell were presented in assets held-for-sale on our condensed consolidated balance sheet as of November 1, 2015.

3. Goodwill and Intangible Assets

Goodwill

The following table summarizes changes in goodwill by segment (in millions):

During the fiscal quarter ended January 31, 2016 , we wrote off $6 million of in-process research and development related to our enterprise storage segment which was abandoned as a result of the Broadcom Transaction. This amount is included in restructuring and disposal charges in the condensed consolidated statements of operations.

Based on the amount of intangible assets subject to amortization at January 31, 2016 , the expected amortization expense for each of the next five fiscal years and thereafter is as follows (in millions):

The weighted-average amortization periods remaining by intangible asset category were as follows (in years):

4. Retirement Plans

The following table summarizes the components of the net periodic benefit income for our defined benefit pension plans for the periods presented (in millions):

During the fiscal quarter ended January 31, 2016 , we contributed $4 million to our defined benefit pension plans. We currently expect to contribute an additional $27 million to our defined benefit pension plans during the remainder of fiscal year 2016 .

5. Borrowings

2014 Term Loans and Revolving Credit Facility

In connection with the acquisition of LSI Corporation, or LSI, on May 6, 2014, certain of Avago's subsidiaries entered into a collateralized credit agreement with the lenders named therein, or the 2014 Credit Agreement. The 2014 Credit Agreement provided for a term loan facility of $4,600 million , or the 2014 Term Loans, and a revolving credit facility, or the 2014 Revolving Credit Facility, which permitted certain of Avago's subsidiaries to borrow up to $500 million . Additionally, it provided for swingline loans of up to $75 million and the issuance of letters of credit of up to $100 million , both of which reduced the available borrowing capacity under the 2014 Revolving Credit Facility. We were in compliance with the covenants described in the 2014 Credit Agreement as of January 31, 2016 .

The 2014 Term Loans had a stated term of seven years and as of January 31, 2016 , had an effective interest rate of 4.15% . As of January 31, 2016 and November 1, 2015 , the outstanding principal balance of 2014 Term Loans was $3,938 million and $3,949 million , respectively. The 2014 Revolving Credit Facility had a stated term of five years. As of January 31, 2016 and November 1, 2015 , there were no borrowings outstanding under the 2014 Revolving Credit Facility and letters of credit outstanding were not material.

Unamortized debt issuance costs associated with the 2014 Term Loans and 2014 Revolving Credit Facility as of January 31, 2016 and November 1, 2015 , were $82 million and $86 million , respectively, and are included in other current assets and other long-term assets on the condensed consolidated balance sheets. Amortization of debt issuance costs related to the 2014 Term Loans and 2014 Revolving Credit Facility was $4 million in each of the fiscal quarters ended January 31, 2016 and February 1, 2015 and was included in interest expense in the condensed consolidated statements of operations.

In connection with the completion of the Broadcom Transaction and subsequent to our first fiscal quarter of 2016, certain of Broadcom's subsidiaries entered into a new collateralized credit agreement, or the 2016 Credit Agreement, with a syndicate of banks. Simultaneously with entering into the 2016 Credit Agreement, the 2014 Credit Agreement was repaid in full and terminated. The 2016 Credit Agreement is discussed in further detail in Note 12. "Subsequent Events".

Principal Payments of Long-term Debt

The future scheduled principal payments for the outstanding 2014 Term Loans as at January 31, 2016, including the current portion, were as follows (in millions):

6. Shareholders’ Equity

Dividends

We paid cash dividends of $0.44 and $0.35 per ordinary share, or $122 million and $89 million , during the fiscal quarters ended January 31, 2016 and February 1, 2015 , respectively.

Share-Based Compensation Expense

The following table summarizes share-based compensation expense reported in continuing operations related to share-based awards granted to employees and directors for the periods presented (in millions):

The fair values of our time-based share options and ESPP purchase rights were estimated using the Black-Scholes option pricing model. The fair value of time-based RSUs was estimated using the closing market price of Avago ordinary shares on the date of grant, reduced by the present value of dividends expected to be paid on Avago ordinary shares prior to vesting. The fair value of market-based awards was estimated using Monte Carlo simulation techniques. No time-based share options or market-based awards were granted during the fiscal quarter ended January 31, 2016 .

The total unrecognized compensation cost of time and market-based share options granted but not yet vested as of January 31, 2016 was $109 million , which is expected to be recognized over the remaining weighted-average service period of 2.1  years. Total unrecognized compensation cost related to unvested time and market-based RSUs as of January 31, 2016 was $353 million , which is expected to be recognized over the remaining weighted-average service period of 3.0  years.

Equity Incentive Award Plans

A summary of share option activity related to our equity incentive award plans is as follows (in millions, except years and per share amounts):

The total intrinsic values of options exercised during the fiscal quarters ended January 31, 2016 and February 1, 2015 were $167 million and $132 million , respectively.

RSU activity was not material for the fiscal quarter ended January 31, 2016.

7. Income Taxes

For the fiscal quarter ended January 31, 2016 , our income tax provision was $17 million compared to an income tax provision of $13 million for the fiscal quarter ended February 1, 2015 . The increase in income tax provision was due to the increase in profit before tax and a decrease in discrete benefits.

The income tax provision for the fiscal quarter ended January 31, 2016 included a benefit from the net recognition of previously unrecognized tax benefits as a result of the expiration of the statute of limitations for certain audit periods of $4 million , compared to $5 million for the fiscal quarter ended  February 1, 2015 . The income tax provision for the fiscal quarter ended January 31, 2016 also included a discrete benefit of $13 million from the retroactive reinstatement of the U.S. Federal Research and Development tax credit from January 1, 2015 to November 1, 2015 compared to $15 million for the fiscal quarter

ended February 1, 2015, from the retroactive reinstatement of the U.S. Federal Research and Development tax credit from January 1, 2014 to November 2, 2014.

Unrecognized Tax Benefits

We are subject to Singapore income tax examinations for the years ended October 31, 2011 and later, and in major jurisdictions outside Singapore for the years ended November 2, 2008 and later. We believe it is possible that we may recognize up to $3 million of our existing unrecognized tax benefits within the next 12 months as a result of lapses of the statute of limitations for certain audit periods.

8. Segment Information

Reportable Segments

We have four reportable segments: enterprise storage, wireless communications, wired infrastructure and industrial & other. These segments align with our principal target markets. The segments represent components of the Company for which separate financial information is available that is utilized on a regular basis by the Chief Executive Officer, who has been identified as the Chief Operating Decision Maker, or CODM, as defined by authoritative guidance on segment reporting, in determining how to allocate resources and evaluate performance. The segments are determined based on several factors, including client base, homogeneity of products, technology, delivery channels and similar economic characteristics.

Our CODM assesses the performance of each segment and allocates resources to those segments based on net revenue and operating income (loss) and does not evaluate operating segments using discrete asset information. Operating income (loss) by segment includes items that are directly attributable to each segment. Operating income (loss) by segment also includes shared expenses such as global operations, including manufacturing support, logistics and quality control, which are allocated primarily based on headcount, expenses associated with our globally integrated support organizations, such as sales and corporate marketing functions, as well as finance, information technology, human resources, legal and related corporate infrastructure costs, along with certain benefit related expenses, which are allocated primarily based on a percentage of revenue, and facilities allocated based on square footage.

Unallocated Expenses

Unallocated expenses include amortization of intangible assets, share-based compensation expense, restructuring and disposal charges, acquisition-related costs and other costs, which are not used in evaluating the results of, or in allocating resources to, our segments. Acquisition-related costs include transaction costs and any costs directly related to the acquisition and integration of acquired businesses.

Depreciation expense directly attributable to each reportable segment is included in operating income (loss) for each segment. However, the CODM does not evaluate depreciation expense by operating segment and, therefore, it is not separately presented. There was no inter-segment revenue. The accounting policies of the segments are the same as those described in the summary of significant accounting policies.

The following tables present our net revenue and operating income (loss) by reportable segment for the periods presented (in millions):

9. Related Party Transactions

2.0% Convertible Senior Notes

In May 2014, Avago completed a private placement of its Convertible Notes to two entities affiliated with Silver Lake Partners, or the Purchasers, of which Kenneth Hao, one of our directors, is a Managing Partner and Managing Director. During fiscal year 2015, the Purchasers converted all of the Convertible Notes that they held in exchange for cash and Avago ordinary shares.

Silicon Manufacturing Partners Pte. Ltd.

We hold a 51% equity interest in Silicon Manufacturing Partners Pte. Ltd., or SMP, a joint venture with GlobalFoundries. We have a take-or-pay agreement with SMP under which we have agreed to purchase 51% of the managed wafer capacity from SMP’s integrated circuit, or IC, manufacturing facility and GlobalFoundries has agreed to purchase the remaining managed wafer capacity. SMP determines its managed wafer capacity each year based on forecasts provided by us and GlobalFoundries. If we fail to purchase our required commitments, we will be required to pay SMP for the fixed costs associated with the unpurchased wafers. GlobalFoundries is similarly obligated with respect to the wafers allotted to it. The agreement may be terminated by either party upon two years written notice. The agreement may also be terminated for material breach, bankruptcy or insolvency. We purchased $10 million and $15 million of inventory from SMP for the fiscal quarters ended January 31, 2016 and February 1, 2015 , respectively. As of January 31, 2016 and November 1, 2015 , the amount payable to SMP was $5 million and $4 million , respectively.

Other

During the fiscal quarters ended January 31, 2016 and February 1, 2015 , in the ordinary course of business, the Company purchased from, or sold to, several entities of which one of the Company's directors also serves or served as a director, or which entities are otherwise affiliated with one of the Company's directors.

The following tables summarize the transactions and balances with our related parties for the indicated periods (for the portion of such period that they were considered related) (in millions):

10. Commitments and Contingencies

Commitments

The following table summarizes contractual obligations and commitments as of January 31, 2016 , that have materially changed from the end of fiscal year 2015 (in millions):

Debt Principal, Interest and Fees. Represents principal, interest and commitment fees payable on borrowings and credit facilities under the 2014 Credit Agreement.

Purchase Commitments.  Represents unconditional purchase obligations that include agreements to purchase goods or services, primarily inventory, that are enforceable and legally binding on us and that specify all significant terms, including fixed or minimum quantities to be purchased, fixed, minimum or variable price provisions, and the approximate timing of the transaction. Purchase obligations exclude agreements that are cancelable without penalty.

We also make capital expenditures in connection with the expansion of our Fort Collins, Colorado, internal fabrication facility. These purchases are typically conducted on a purchase order basis and the amount shown in the table includes $77 million of cancelable and non-cancelable outstanding purchase obligations under such purchase orders as of January 31, 2016 .

Under our take-or-pay agreement with SMP, we have agreed to purchase 51% of the managed wafer capacity from SMP’s IC manufacturing facility. If we fail to purchase our required commitments, we will be required to pay SMP for the fixed costs associated with the unpurchased wafers.

Due to the inherent uncertainty with respect to the timing of future cash outflows associated with our unrecognized tax benefits at  January 31, 2016 , we are unable to reliably estimate the timing of cash settlement with the respective taxing authority. Therefore,  $318 million of unrecognized tax benefits and accrued interest classified within other long-term liabilities on our condensed consolidated balance sheet as of  January 31, 2016  have been excluded from the contractual obligations table above. In addition, the table above does not reflect increased debt obligations or interest expense associated with the debt incurred subsequent to January 31, 2016 in connection with the completion of the Broadcom Transaction.

There were no other substantial changes to our contractual commitments during the first quarter of fiscal year 2016 from those disclosed in Avago's 2015 Annual Report on Form 10-K.

Contingencies

From time to time, we are involved in litigation that we believe is of the type common to companies engaged in our line of business, including commercial disputes, employment issues and disputes involving claims by third parties that our activities infringe their patent, copyright, trademark or other intellectual property rights. Legal proceedings are often complex, may require the expenditure of significant funds and other resources, and the outcome of litigation is inherently uncertain, with material adverse outcomes possible. Intellectual property claims generally involve the demand by a third-party that we cease the manufacture, use or sale of the allegedly infringing products, processes or technologies and/or pay substantial damages or royalties for past, present and future use of the allegedly infringing intellectual property. Claims that our products or processes infringe or misappropriate any third-party intellectual property rights (including claims arising through our contractual indemnification of our customers) often involve highly complex, technical issues, the outcome of which is inherently uncertain. Moreover, from time to time we pursue litigation to assert our intellectual property rights. Regardless of the merit or resolution of any such litigation, complex intellectual property litigation is generally costly and diverts the efforts and attention of our management and technical personnel.

Lawsuits Relating to the Acquisition of BRCM

Since the announcement of the Broadcom Transaction, 11 putative class action complaints have been filed by and purportedly on behalf of alleged BRCM shareholders. Two putative class action complaints were filed in the United States District Court for the Central District of California, captioned: Wytas, et al. v. McGregor, et al., Case No. 8:15-cv-00979, filed on June 18, 2015; and Yassian, et al. v. McGregor, et al., Case No. 8:15-cv-01303, filed on August 15, 2015, or the Federal Actions. On September 2, 2015, plaintiffs in the Wytas, et al. v. McGregor, et al. matter filed an amended complaint adding claims under the U.S. federal securities laws.  One putative class action complaint was filed in the Superior Court of the State of California, County of Santa Clara, captioned Jew v. Broadcom Corp., et al., Case No. 1-15-CV-281353, filed June 2, 2015.  Eight putative class action complaints were filed in the Superior Court of the State of California, County of Orange, captioned: Xu v. Broadcom Corp., et al., Case No. 30-2015-00790689-CU-SL-CXC, filed June 1, 2015; Freed v. Broadcom Corp., et al., Case No. 30-2015-00790699-CU-SL-CXC, filed June 1, 2015; N.J. Building Laborers Statewide Pension Fund v. Samueli, et al., Case No. 30-2015-00791484-CU-SL-CXC, filed June 4, 2015; Yiu v. Broadcom Corp., et al., Case No. 30-2015-00791490-CU-SL-CXC, filed June 4, 2015; Yiu, et al. v. Broadcom Corp., et al., Case No. 30-2015-00791762-CU-BT-CXC, filed June 5, 2015; Yassian, et al. v. McGregor, et al., Case No. 30-2015-00793360-CU-SL-CXC, filed June 15, 2015; Seafarers’ Pension Plan v. Samueli, et al., Case No. 30-2015-00794492-CU-SL-CXC, filed June 19, 2015; and Engel v. Broadcom Corp., et al., Case No. 30-2015-00797343-CU-SL-CXC, filed on July 2, 2015 (together with Jew v. Broadcom Corp., et al., the State Actions). The Federal Actions and State Actions name as defendants, among other parties, BRCM, members of BRCM’s board of directors and Avago, and allege, among other things, breaches of fiduciary duties and aiding and abetting those alleged breaches. Additionally, the Federal Actions allege violations of Sections 14(a) and 20(a) of the Exchange Act and SEC Rule 14-a9.

On August 14, 2015, the Superior Court of the State of California, County of Orange, issued an order coordinating and consolidating the State Actions, captioned Broadcom Shareholder Cases, JCCP 4834. On September 18, 2015, the United States District Court for the Central District of California consolidated the Federal Actions under the caption In re Broadcom Corporation Stockholder Litigation, Case No. 8:15-cv-00979. On September 25, 2015, the Superior Court of the State of California, County of Orange, stayed the State Actions pending the outcome of the Federal Actions.

On October 28, 2015, BRCM supplemented its disclosures, and filed additional proxy materials with the SEC. On November 10, 2015, BRCM shareholders voted to approve the Broadcom Transaction.

On November 16, 2015, the United States District Court for the Central District of California appointed lead plaintiffs and lead counsel in the Federal Actions.

On January 15, 2016, lead plaintiffs in the Federal Actions filed a Second Amended Consolidated Class Action Complaint, or the Federal Consolidated Compliant, which names as defendants, among other parties, members of BRCM's board of

directors and Avago, and alleges breaches of fiduciary duties and aiding and abetting those alleged breaches, as well as violation of Sections 14(a) and 20(a) of the Exchange Act and SEC Rule 14-a9.

On February 1, 2016, we completed the acquisition of BRCM. On February 16, 2016, defendants filed a motion to dismiss the Federal Consolidated Complaint.

Lawsuits Relating to the Acquisition of Emulex

On March 3, 2015, two putative shareholder class action complaints were filed in the Court of Chancery of the State of Delaware against Emulex Corporation, or Emulex, its directors, Avago Technologies Wireless (U.S.A.) Manufacturing Inc., or AT Wireless, and Emerald Merger Sub, Inc., or Merger Sub, captioned as follows: James Tullman v. Emulex Corporation, et al., Case No. 10743-VCL (Del. Ch.); Moshe Silver ACF/Yehudit Silver U/NY/UTMA v. Emulex Corporation, et al., Case No. 10744-VCL (Del. Ch.). On March 11, 2015, a third complaint was filed in the Delaware Court of Chancery, captioned Hoai Vu v. Emulex Corporation, et al., Case No. 10776-VCL (Del. Ch.). The complaints alleged, among other things, that Emulex’s directors breached their fiduciary duties by approving the Agreement and Plan of Merger, dated February 25, 2015, by and among AT Wireless, Merger Sub and Emulex, or the Merger Agreement, and that AT Wireless and Merger Sub aided and abetted these alleged breaches of fiduciary duty. The complaints sought, among other things, either to enjoin the transaction or to rescind it following its completion, as well as damages, including attorneys’ and experts’ fees. The Delaware Court of Chancery has entered an order consolidating the three Delaware actions under the caption In re Emulex Corporation Stockholder Litigation, Consolidated C.A. No. 10743-VCL. On May 5, 2015, we completed our acquisition of Emulex. On June 5, 2015, the Court of Chancery dismissed the consolidated action without prejudice.

On April 8, 2015, a putative class action complaint was filed in the United States District Court for the Central District of California, entitled Gary Varjabedian, et al. v. Emulex Corporation, et al., No. 8:15-cv-554-CJC-JCG. The complaint names as defendants Emulex, its directors, AT Wireless and Merger Sub, and purported to assert claims under Sections 14(d), 14(e) and 20(a) of the Exchange Act. The complaint alleged, among other things, that the board of directors of Emulex failed to provide material information and/or omitted material information from the Solicitation/Recommendation Statement on Schedule 14D-9 filed with the SEC on April 7, 2015 by Emulex, together with the exhibits and annexes thereto. The complaint sought to enjoin the tender offer to purchase all of the outstanding shares of Emulex common stock, as well as certain other equitable relief and attorneys’ fees and costs. On July 28, 2015, the court issued an order appointing the lead plaintiff and approving lead counsel for the putative class. On September 9, 2015, plaintiff filed a first amended complaint seeking rescission of the merger, unspecified money damages, other equitable relief and attorneys’ fees and costs. On October 13, 2015, defendants moved to dismiss the first amended complaint, which the court granted with prejudice on January 13, 2016. Plaintiff filed a notice of appeal to the United States Court of Appeals for the Ninth Circuit on January 15, 2016. The appeal is captioned Gary Varjabedian, et al. v. Emulex Corporation, et al., No. 16-55088.

Lawsuits Relating to the Acquisition of PLX

In June and July 2014, four lawsuits were filed in the Superior Court for the State of California, County of Santa Clara challenging our acquisition of PLX. On July 22, 2014, the court consolidated these California actions under the caption In re PLX Technology, Inc. S’holder Litig., Lead Case No. 1-14-CV-267079 (Cal. Super. Ct., Santa Clara) and appointed lead counsel. That same day, the court also stayed the consolidated action, pending resolution of related actions filed in the Delaware Court of Chancery, described below.

Also in June and July 2014, five similar lawsuits were filed in the Delaware Court of Chancery. On July 21, 2014, the court consolidated these Delaware actions under the caption In re PLX Technology, Inc. Stockholders Litigation, Consol. C.A. No. 9880-VCL (Del. Ch.), appointed lead plaintiffs and lead counsel, and designated an operative complaint for the consolidated action. On July 31, 2014, counsel for lead plaintiffs in Delaware informed the court that they would not seek a preliminary injunction, but intend to seek damages and pursue monetary remedies through post-closing litigation. Our acquisition of PLX closed on August 12, 2014.

On October 31, 2014, lead plaintiffs filed a consolidated amended complaint. This complaint alleges, among other things, that PLX’s directors breached their fiduciary duties to PLX’s stockholders by seeking to sell PLX for an inadequate price, pursuant to an unfair process, and by agreeing to preclusive deal protections in the merger agreement. Plaintiffs also allege that Potomac Capital Partners II, L.P., Deutsche Bank Securities, AT Wireless, and Pluto Merger Sub, Inc., the acquisition subsidiary, aided and abetted the alleged fiduciary breaches. Plaintiffs also allege that PLX’s Solicitation/Recommendation statement on Schedule 14D-9, as filed with the SEC, contained false and misleading statements and/or omitted material information necessary to inform the shareholder vote. The plaintiffs seek, among other things, monetary damages and attorneys’ fees and costs. On September 3, 2015, the court granted motions to dismiss filed by AT Wireless, the acquisition subsidiary and two PLX directors, and denied motions to dismiss filed by several other PLX directors, Potomac Capital Partners II, L.P. and Deutsche Bank Securities.

The Delaware class litigation is on-going.

Other Matters

In addition to the matters discussed above, we are currently engaged in a number of legal actions in the ordinary course of our business.

We do not believe, based on currently available facts and circumstances, that the final outcome of any pending legal proceedings, taken individually or as a whole, will have a material adverse effect on our financial condition, results of operations or cash flows. However, lawsuits may involve complex questions of fact and law and may require the expenditure of significant funds and other resources to defend. The results of litigation are inherently uncertain, and material adverse outcomes are possible. From time to time, we may enter into confidential discussions regarding the potential settlement of such lawsuits. Any settlement of pending litigation could require us to incur substantial costs and other ongoing expenses, such as future royalty payments in the case of an intellectual property dispute.

During the periods presented, no material amounts have been accrued or disclosed in the accompanying condensed consolidated financial statements with respect to loss contingencies associated with any legal proceedings, as potential losses for such matters are not considered probable and ranges of losses are not reasonably estimable. These matters are subject to many uncertainties and the ultimate outcomes are not predictable. There can be no assurances that the actual amounts required to satisfy any liabilities arising from the matters described above will not have a material adverse effect on our results of operations, financial position or cash flows.

Other Indemnifications

As is customary in our industry and as provided for in local law in the United States and other jurisdictions, many of our standard contracts provide remedies to our customers and others with whom we enter into contracts, such as defense, settlement, or payment of judgment for intellectual property claims related to the use of our products. From time to time, we indemnify customers, as well as our suppliers, contractors, lessors, lessees, companies that purchase our businesses or assets and others with whom we enter into contracts, against combinations of loss, expense, or liability arising from various triggering events related to the sale and the use of our products, the use of their goods and services, the use of facilities and state of our owned facilities, the state of the assets and businesses that we sell and other matters covered by such contracts, usually up to a specified maximum amount. In addition, from time to time we also provide protection to these parties against claims related to undiscovered liabilities, additional product liability or environmental obligations. In our experience, claims made under such indemnifications are rare and the associated estimated fair value of the liability is not material.

11. Restructuring and Disposal Charges

During each of the fiscal quarters ended January 31, 2016 and February 1, 2015 , we recognized $16 million of restructuring costs primarily related to employee termination costs associated with completed and pending acquisitions. Restructuring costs for the fiscal quarter ended January 31, 2016 included a $6 million write-off of in-process research and development which was abandoned as a result of the Broadcom Transaction. These costs are principally reflected in operating expenses in the condensed consolidated statements of operations.

During the fiscal quarter ended January 31, 2016 , we sold certain fiber optics subsystem manufacturing and related assets and recognized a $16 million loss related to the disposal of these assets.

The following table summarizes the significant activities within, and components of, the restructuring liabilities during the fiscal quarter ended January 31, 2016 (in millions):

(a) The majority of the employee termination costs balance is expected to be paid by the second quarter of fiscal year 2017 . The leases and other exit costs balance is expected to be paid during the remaining terms of the leases, which extend through fiscal year 2019 .

12. Subsequent Events

Acquisition of Broadcom Corporation

On February 1, 2016, the Broadcom Transaction closed. Pursuant to the terms of the Broadcom Agreement, each share of BRCM common stock, or BRCM Share, issued and outstanding immediately prior to the effective time of the Broadcom Merger, was converted into the right to receive: (i) $54.50 in cash, subject to proration as set forth in the Broadcom Agreement,

(ii)  0.4378 of our ordinary shares, subject to proration as set forth in the Broadcom Agreement or (iii)  0.4378 exchangeable limited partnership units in the Partnership, or the Restricted Exchangeable Units.

Based on the elections made by BRCM shareholders, the election to receive cash, or Cash Electing Shares, was oversubscribed. Therefore, the consideration received by cash electing shareholders was prorated in accordance with the Broadcom Agreement, and those shareholders received approximately $51.4829 in cash and 0.0242 of our ordinary shares for each Cash Electing Share. Elections by BRCM shareholders to receive our ordinary shares or the Restricted Exchangeable Units in exchange for their BRCM Shares were not subject to proration.

We funded the cash portion of the Broadcom Transaction with net proceeds from the issuance of the 2016 Term Loans, as defined below, as well as cash on hand of the combined companies.

The aggregate consideration for the Broadcom Transaction was approximately $28,731 million , net of cash acquired, consisting of the following (in millions):

We have not finalized the purchase price allocation. Accordingly, the preliminary purchase price allocation shown below could change materially as we finalize the fair values of the tangible and intangible assets acquired and liabilities assumed.

Our preliminary allocation of the total purchase price, net of cash acquired, is as follows (in millions):

Goodwill is primarily attributable to the assembled workforce, anticipated company-specific synergies and economies of scale expected from the operations of the combined company. The synergies include certain cost savings, operating efficiencies, and other strategic benefits projected to be achieved as a result of the Broadcom Merger. The assignment of goodwill to our reportable segments has not yet been completed. Goodwill is not expected to be deductible for tax purposes.

Unaudited Pro Forma Information

The following unaudited pro forma financial information presents combined results of operations for each of the periods presented, as if BRCM had been acquired as of the beginning of fiscal year 2015. The unaudited pro forma financial information for the three months ended January 31, 2016 combined the historical results of Avago for the fiscal quarter ended January 31, 2016, and the historical results of BRCM for the three months ended December 31, 2015, representing BRCM's previous reporting period prior to the date of acquisition. The pro forma information includes adjustments to amortization and depreciation for intangible assets and property, plant and equipment acquired, adjustments to share-based compensation expense, the purchase accounting effect on inventory acquired, interest expense for the additional indebtedness incurred to complete the acquisition, restructuring charges in connection with the acquisition and acquisition costs. The pro forma data are for informational purposes only and are not necessarily indicative of the consolidated results of operations of the combined business had the merger actually occurred at the beginning of fiscal year 2015 or of the results of future operations of the combined business. Consequently, actual results will differ from the unaudited pro forma information presented below (in millions):

	Fiscal Quarter Ended
	January 31, 2016				February 1, 2015
Pro forma net revenue	$	3,822			$	3,776
Pro forma net income (loss)	$	407			$	(599	)
Pro forma income (loss) per share - basic	$	1.05			$	(1.63	)
Pro forma income (loss) per share - diluted	$	1.01			$	(1.63	)

2016 Term Loans and Revolving Credit Facility

In connection with the completion of the Broadcom Transaction, on February 1, 2016, three of Broadcom's subsidiaries, specifically Avago Technologies Cayman Holdings Ltd., or Intermediate Holdco, Avago Technologies Cayman Finance Limited, or Finance Holdco, and BC Luxembourg S.à r.l., or collectively, the Borrowers, together with a group of lenders, including Bank of America, N.A., as the administrative agent and collateral agent, entered into the 2016 Credit Agreement. The 2016 Credit Agreement provides for a Term A loan facility in the aggregate principal amount of $4,400 million , or Term A Loan, a Term B-1 dollar loan facility in the aggregate principal amount of $9,750 million , or Term B-1 Loan, a Term B-1 euro loan facility in the aggregate principal amount of €900 million , which was the equivalent to $978 million using the exchange rate of $1.0865 EUR/USD, or Term B-1 Euro Loan, a Term B-2 loan facility in the aggregate principal amount of $500 million , or Term B-2 Loan, together with the Term A Loan, Term B-1 Loan, Term B-1 Euro Loan, or the 2016 Term Loans, and a revolving credit facility, or the 2016 Revolving Credit Facility, that permits the Borrowers, to borrow loans from time to time in an aggregate principal amount of up to $500 million for working capital and other corporate purposes, including swingline loans of up to $150 million in the aggregate and for the issuance of letters of credit of up to $100 million in the aggregate, which, in the case of swingline loans and letters of credit, reduce the available borrowing capacity under the 2016 Revolving Credit Facility on a dollar for dollar basis. The Borrowers’ obligations under the 2016 Credit Agreement are guaranteed by Intermediate Holdco and certain of its subsidiaries, or the Guarantors, and are collateralized, subject to certain exceptions, by substantially all of the assets of Intermediate Holdco, each Borrower, and each Guarantor. The Term A Loan has a term of five

years, the Term B-1 Loan and Term B-1 Euro Loan each have a term of seven years, the Term B-2 Loan has a term of one year and the 2016 Revolving Credit Facility has a term of five years. The 2016 Term Loans were fully drawn at the time of, and the proceeds used to fund, in part, the completion of the Broadcom Transaction.

The 2016 Term Loans under the 2016 Credit Agreement will bear interest at floating rates. The Term A Loan has an initial interest rate of 2.17% , the Term B-1 Loan and Term B-1 Euro Loan have an initial interest rate of 4.25% and the Term B-2 Loan has an initial interest rate of 2.17% . The 2016 Credit Agreement includes financial covenants, customary restrictive covenants, customary events of default, and customary representations and warranties. In addition, subject to certain conditions, we have the ability to increase the aggregate 2016 Term Loans and/or 2016 Revolving Credit Facility. The Borrowers have agreed to pay the lenders a commitment fee at a rate that varies based on the public corporate credit rating of Finance Holdco.

We expect to incur approximately $141 million of debt modification fees and a loss on extinguishment of debt related to entering into the 2016 Credit Agreement.

Cash Dividends Declared

On March 2, 2016 , the Board declared an interim cash dividend of $0.49 per ordinary share, payable on March 31, 2016 to shareholders of record at the close of business (Eastern Time) on March 18, 2016 .