1441634--12/15/2010--Avago_Technologies

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The recent economic downturn and financial crisis has negatively affected our business and continuing poor economic conditions may negatively affect our future business, results of operations, and financial condition. If we do not adapt to technological changes in the semiconductor industry, we could lose customers or market share. Dependence on contract manufacturing and outsourcing other portions of our supply chain may adversely affect our ability to bring products to market and damage our reputation. A prolonged disruption of our manufacturing facilities could have a material adverse effect on our business, financial condition and results of operations. Unless we and our suppliers continuously improve manufacturing efficiency and quality, our financial performance could be adversely affected. Winning business is subject to lengthy, competitive selection processes that require us to incur significant expense. Even if we begin a product design, a customer may decide to cancel or change its product plans, which could cause us to generate no revenues from a product and adversely affect our results of operations. We may be subject to claims of infringement of third-party intellectual property rights or demands that we license third-party technology, which could result in significant expense and loss of our intellectual property rights. We utilize a significant amount of intellectual property in our business. If we are unable to protect our intellectual property, our business could be adversely affected. Competition in our industry could prevent us from growing our revenue and from raising prices to offset increases in costs. We may be unable to make the substantial and productive research and development investments which are required to remain competitive in our business. Our business would be adversely affected by the departure of existing members of our senior management team or if our senior management team is unable to effectively implement our strategy. If we are unable to attract, train and retain qualified personnel, especially our design and technical personnel, we may not be able to execute our business strategy effectively. We are subject to warranty claims, product recalls and product liability. The complexity of our products could result in unforeseen delays or expenses or undetected defects or bugs, which could adversely affect the market acceptance of new products, damage our reputation with current or prospective customers, and materially and adversely affect our operating costs. Failure to adjust our supply chain volume due to changing market conditions or failure to accurately estimate our customers demand could adversely affect our results of operations. We are subject to currency exchange risks that could adversely affect our operations. Our operating results and financial condition could be harmed if the markets into which we sell our products decline. The demands or loss of one or more of our significant customers may adversely affect our business. We generally do not have any long-term supply contracts with our contract manufacturers or materials suppliers and may not be able to obtain the products or raw materials required for our business, which could have a material adverse affect on our business. We rely on third parties to provide corporate infrastructure services necessary for the operation of our business. Any failure of one or more of our vendors to provide these services could have a material adverse effect on our business. Our gross margin is dependent on a number of factors, including our product mix and level of capacity utilization. Our business, financial condition and results of operations could be adversely affected by the political and economic conditions of the countries in which we conduct business and other factors related to our international operations. If we suffer loss or significant damage to our factories, facilities or distribution system due to catastrophe, our operations could be seriously harmed. If the tax incentive or tax holiday arrangements we have negotiated in Singapore and other jurisdictions change or cease to be in effect or applicable, or if our assumptions and interpretations regarding tax laws and incentive or holiday arrangements prove to be incorrect, the amount of corporate income taxes we have to pay could significantly increase. The enactment of legislation implementing changes in U.S. taxation of international business activities or the adoption of other tax reform policies could materially impact our financial position and results of operations. We may pursue acquisitions, dispositions, investments and joint ventures, which could affect our results of operations. Our business is subject to various governmental regulations, and compliance with these regulations may cause us to incur significant expenses. If we fail to maintain compliance with applicable regulations, we may be forced to recall products and cease their manufacture and distribution, and we could be subject to civil or criminal penalties. We are subject to environmental, health and safety laws, which could increase our costs, restrict our operations and require expenditures that could have a material adverse affect on our results of operations and financial condition. We have taken significant restructuring charges in the past and may need to take material restructuring charges in the future. We are subject to risks associated with our distributors product inventories and product sell-through. We rely on third-party distributors and manufacturers representatives, as well as our employee sales representatives, and the failure of these representatives to perform as expected could reduce our future sales. The average selling prices of products in our markets have historically decreased rapidly and will likely do so in the future, which could harm our revenues and gross profits. We are required to assess our internal control over financial reporting on an annual basis and any adverse findings from such assessment could result in a loss of investor confidence in our financial reports, significant expenses to remediate any internal control deficiencies and ultimately have an adverse effect on our share price. Our indebtedness could adversely affect our financial health and our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry and prevent us from fulfilling our obligations under our indebtedness. Our senior credit agreement imposes significant restrictions on our business. Risks Relating to Investments in Singapore Companies It may be difficult to enforce a judgment of U.S. courts for civil liabilities under U.S. federal securities laws against us, our directors or officers in Singapore. We are incorporated in Singapore and our shareholders may have more difficulty in protecting their interest than they would as shareholders of a corporation incorporated in the United States. For a limited period of time, our directors have general authority to allot and issue new ordinary shares on terms and conditions as may be determined by our board of directors in its sole discretion. Risks Relating to Owning Our Ordinary Shares Control by principal shareholders could adversely affect our other shareholders. At times, our share price has been volatile and it may fluctuate substantially in the future, which could result in substantial losses for our investors. If securities or industry analysts do not publish research or reports about our business, or publish negative reports about our business, our share price and trading volume could decline. Future sales of our ordinary shares in the public market could cause our share price to fall. There can be no assurance that we will continue to declare cash dividends or declare them in any particular amounts. The requirements of being a public company may strain our resources, divert management s attention and affect our ability to attract and retain qualified board members.

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1441634--12/15/2010--Avago_Technologies_LTD