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Richardson ElectronicsTable of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549 Form 10-K ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended June 30, 2018or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-4224Avnet, Inc.(Exact name of registrant as specified in its charter) New York(State or other jurisdiction of incorporation or organization) 11-1890605(I.R.S. Employer Identification No.) 2211 South 47th Street,Phoenix, Arizona(Address of principal executive offices) 85034(Zip Code) Registrant’s telephone number, including area code (480) 643-2000Securities registered pursuant to Section 12(b) of the Act: Title of Each Class Name of Each Exchange on Which RegisteredCommon Stock The Nasdaq Global Select Market Securities registered pursuant to Section 12(g) of the Act:NoneIndicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☑ No ☐Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☑Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 duringthe preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for thepast 90 days. Yes ☑ No ☐Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to besubmitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit andpost such files). Yes ☑ No ☐Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best ofregistrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or anemerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” inRule 12b-2 of the Exchange Act. Large accelerated filer ☑ Accelerated filer ☐ Non-accelerated filer ☐(Do not checkif a smaller reporting company) Smaller reporting company ☐ Emerging growth company ☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new orrevised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑The aggregate market value (approximate) of the registrant’s common equity held by non-affiliates based on the closing price of a share of the registrant’scommon stock for New York Stock Exchange composite transactions on December 29, 2017 (the last business day of the registrant’s most recently completed secondfiscal quarter) was $4,696,819,462.As of July 27, 2018, the total number of shares outstanding of the registrant’s Common Stock was 115,761,361 shares, net of treasury shares.DOCUMENTS INCORPORATED BY REFERENCEPortions of the registrant’s definitive proxy statement (to be filed pursuant to Reg. 14A) relating to the Annual Meeting of Shareholders anticipated to be held onNovember 16, 2018, are incorporated herein by reference in Part III of this Report. Table of ContentsTABLE OF CONTENTS PagePART I Item 1. Business 3 Item 1A. Risk Factors 7 Item 1B. Unresolved Staff Comments 15 Item 2. Properties 15 Item 3. Legal Proceedings 15 Item 4. Mine Safety Disclosures 16 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of EquitySecurities 16 Item 6. Selected Financial Data 20 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 22 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 37 Item 8. Financial Statements and Supplementary Data 38 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 38 Item 9A. Controls and Procedures 38 Item 9B. Other Information 39 PART III Item 10. Directors, Executive Officers and Corporate Governance 40 Item 11. Executive Compensation 40 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 40 Item 13. Certain Relationships and Related Transactions, and Director Independence 40 Item 14. Principal Accounting Fees and Services 40 PART IV Item 15. Exhibits and Financial Statement Schedules 41 2 Table of Contents PART I Item 1. BusinessAvnet, Inc. (the “Company” or “Avnet”), is a global technology solutions company with an extensive ecosystemdelivering design, product, marketing and supply chain expertise for customers at every stage of the product lifecycle. Avnettransforms ideas into intelligent solutions, reducing the time, cost and complexities of bringing products to market aroundthe world. Founded in 1921 and incorporated in New York in 1955, the Company works with over 1,400 technologysuppliers to serve 2.1 million customers in more than 140 countries.For nearly a century, Avnet has helped its customers and suppliers realize the transformative possibilities of technologywhile continuously expanding the breadth and depth of its capabilities. Today, as technologies like the Internet of Things(“IoT”) continue to increase the complexity in product development, Avnet is once again redefining itself by offeringeverything customers need to bring their product to life through one partner. Most recently Avnet significantly enhanced itsexpertise in design, supply chain and logistics by acquiring the capabilities to better serve customers in the earlier stages ofproduct development—encompassing research, prototyping and manufacturing—through the purchase of Premier Farnell(fiscal 2017), Hackster.io (fiscal 2017) and Dragon Innovation (fiscal 2018). Avnet’s ecosystem is designed to match itscustomers’ needs along their entire product development journey, providing both end-to-end and à la carte support options,as well as digital tools, to meet varying needs and buying preferences.The Company operates in 125 locations spanning the Americas, Europe, Middle East and Africa (“EMEA”) andAsia/Pacific (“Asia”) regions. Because Avnet supports every stage of the product lifecycle, it serves a wide range ofcustomers: from startups and mid-sized businesses to enterprise-level original equipment manufacturers (“OEMs”), electronicmanufacturing services (“EMS”) providers and original design manufacturers (“ODMs”). Avnet works with customers ofevery size, in every corner of the world, to guide today’s ideas into tomorrow’s technology.Organizational StructureAvnet has two primary operating groups — Electronic Components (“EC”) and Premier Farnell (“PF”). Both operatinggroups have operations in each of the three major economic regions of the world: the Americas, EMEA and Asia. Eachoperating group has its own management team that includes senior executives and leadership both at the global and regionallevels, who manage various functions within such businesses. Each operating group also has distinct financial reporting thatis evaluated at the executive level on which operating decisions and strategic planning and resource allocation for theCompany as a whole are made. Divisions (“business units”) exist within each operating group that serve primarily as salesand marketing units to further streamline the sales efforts within each operating group and enhance each operating group’sability to work with its customers and suppliers, generally along more specific product lines or geographies. However, eachbusiness unit relies heavily on the support services provided by the operating groups as well as centralized support at thecorporate level.A description of each operating group is presented below. Further financial information by operating group is providedin Note 17 “Segment information” to the consolidated financial statements appearing in Item 15 of this Annual Report onForm 10-K.Avnet’s foreign operations are subject to a variety of risks. These risks are discussed further under Risk Factors inItem 1A and under Quantitative and Qualitative Disclosures About Market Risk in Item 7A of this Report. Additionally, thespecific translation impacts of foreign currency fluctuations, most notably the Euro and the British Pound, on the Company’sconsolidated financial statements are further discussed in Management’s Discussion and Analysis of Financial Conditionand Results of Operations in Item 7 of this Report.3 Table of ContentsElectronic ComponentsAvnet’s EC operating group primarily supports high-volume customers. It markets, sells and provides value-addeddesign and supply chain capabilities for semiconductors, electronic components (including interconnect, passive andelectromechanical, or “IP&E,” devices) and other integrated components from the world’s leading electronic componentmanufacturers.EC serves a variety of markets ranging from automotive to medical to defense and aerospace. It offers an array ofcustomer support options throughout the entire product lifecycle, including both turnkey and customized design, newproduct introduction, production, supply chain, logistics and post-sales services.Design Chain SolutionsEC offers design chain support that provides engineers with a host of technical design solutions, which help make iteconomically viable for EC’s suppliers to reach a customer segment that seeks complex products and technologies. Withaccess to a suite of design tools and engineering support from any point in the design cycle, customers can get productspecifications along with evaluation kits and reference designs that enable a broad range of applications from conceptthrough detailed design including new product introduction. EC also offers engineering and technical resources deployedglobally to support product design, bill of materials development, and technical education and training. By utilizing EC’sdesign chain support, customers can optimize their component selection and accelerate their time to market. EC’s extensiveproduct line card provides customers access to a diverse range of products from a complete spectrum of electronic componentmanufacturers.Supply Chain SolutionsEC’s supply chain solutions provide support and logistical services to OEMs, EMS providers and electroniccomponent manufacturers, enabling them to optimize supply chains on a local, regional or global basis. By combininginternal competencies in global warehousing and logistics, finance, information technology and asset management with itsglobal footprint and extensive partner relationships, EC’s supply chain solutions provide for a deeper level of engagementwith its customers. These customers can manage their supply chains to meet the demands of a competitive globalenvironment without a commensurate investment in physical assets, systems and personnel. With supply chain planningtools and a variety of inventory management solutions, EC provides solutions that meet a customer’s just-in-timerequirements and minimize risk in a variety of scenarios including lean manufacturing, demand flow and outsourcing.Avnet IntegratedEC provides integrated solutions including technical design, integration and assembly of embedded products, systemsand solutions primarily for industrial applications. EC also provides integrated solutions for intelligent embedded andinnovative display solutions, including touch and passive displays. In addition, EC develops and produces standard boardand industrial subsystems and application-specific devices that enable it to produce specialized systems tailored to specificcustomer requirements. EC serves OEMs that require embedded systems and solutions, including engineering, productprototyping, integration and other value-added services in the medical, telecommunications, industrial and digital editingmarkets.Premier FarnellAvnet’s Premier Farnell (“PF”) operating group supports primarily low-volume customers that need electroniccomponents quickly to develop, prototype and test their products. It distributes a comprehensive portfolio of kits, tools,4 Table of Contentselectronic components and industrial automation components to both engineers and entrepreneurs. PF brings the latestproducts, services and development trends all together in element14, an industry-leading online community where engineerscollaborate to solve one another’s design challenges. In element14, members get consolidated information on newtechnologies as well as access to experts and products. Members can see what other engineers are working on, learn fromonline training and get the help they need to optimize their own designs.AcquisitionsAvnet has historically pursued business acquisitions to further its strategic objectives and support key businessinitiatives, completing 100 acquisitions since 1991. This acquisition program was a significant factor in Avnet becomingone of the largest value-added distributors of electronic components including integrated products and solutions. Avnetexpects to continue to pursue strategic acquisitions to expand its ecosystem, market presence, increase its scale and scope,and extend its product and service offerings throughout all stages of the technology product lifecycle.Discontinued OperationsIn fiscal 2017, the Company sold the Technology Solutions (“TS”) business, which was historically a reportableoperating segment. With the sale of the TS business, the Company is focused on providing design and supply chain solutionsspecific to the electronic components industry.See Note 3 to the Company’s consolidated financial statements included in Item 15 of this Annual Report on Form 10-K for further discussion on the sale of the TS business.Major ProductsOne of Avnet’s competitive strengths is the breadth and quality of the suppliers whose products it distributes. TexasInstruments products accounted for approximately 11% of the Company’s consolidated sales from continuing operationsduring fiscal 2018, 2017 and 2016, and was the only supplier from which sales of its products exceeded 10% of consolidatedsales. Listed in the table below are the major product categories and the Company’s approximate sales of each during the pastthree fiscal years. Fiscal 2016 contained 53 weeks compared to 52 weeks in the other fiscal years presented. Years Ended June 30, July 1, July 2, 2018 2017 2016 (Millions) Semiconductors $14,890.9 $13,537.9 $13,978.0 Interconnect, passive & electromechanical (IP&E) 3,468.4 2,909.2 2,098.7 Computers 461.9 504.2 222.7 Other 215.7 488.7 441.2 Sales $19,036.9 $17,440.0 $16,740.6 Competition & MarketsThe electronic components industry continues to be extremely competitive. The Company’s major competitorsinclude: Arrow Electronics, Inc., Future Electronics, World Peace Group, Mouser Electronics and Digi-Key Electronics. Thereare also certain smaller, specialized competitors who generally focus on narrower regions, markets, products or particularsectors. As a result of these factors, Avnet must remain competitive in its pricing of products.5 Table of ContentsA key competitive factor in the electronic component distribution industry is the need to carry a sufficient amount ofinventory to meet customers’ rapid delivery requirements. To minimize its exposure related to inventory on hand, themajority of the Company’s products are purchased pursuant to non-exclusive distributor agreements, which typically providecertain protections for product obsolescence and price erosion. These agreements are generally cancelable upon 30 to180 days’ notice and, in most cases, provide for or require inventory return privileges upon cancellation. In fiscal 2017,certain suppliers terminated their distribution agreements with the Company, which did not result in any significantinventory write-downs as a result of such terminations. In addition, the Company enhances its competitive position byoffering a variety of value-added services, which entail the performance of services and/or customer support tailored toindividual customer specifications and business needs, such as point of use replenishment, testing, assembly, supply chainmanagement and materials management.A competitive advantage is the breadth of the Company’s supplier product line card. Because of the number of Avnet’ssuppliers, many customers can simplify their procurement process and make all of their required purchases from Avnet, ratherthan purchasing from several different distributors or other vendors.SeasonalityHistorically, Avnet’s business and continuing operations has not been materially impacted by seasonality, with theexception of an impact on consolidated results from shifts in regional sales trends from Asia in the first half of a fiscal year tothe Americas and EMEA regions in the second half of a fiscal year. Number of EmployeesAt June 30, 2018, Avnet had approximately 15,400 employees compared to 15,700 employees at July 1, 2017, and17,700 at July 2, 2016.Available InformationThe Company files its annual report on Form 10-K, quarterly reports on Form 10-Q, Current Reports on Form 8-K,proxy statements and other documents with the U.S. Securities and Exchange Commission (“SEC”) under the SecuritiesExchange Act of 1934. A copy of any document the Company files with the SEC is available for review at the SEC’s publicreference room, 100 F Street, N.E., Washington, D.C. 20549. The public may obtain information on the public reference roomby calling the SEC at 1-800-SEC-0330. The Company’s SEC filings are also available to the public on the SEC’s website athttp://www.sec.gov and through The Nasdaq Global Select Market (“Nasdaq”), 165 Broadway, New York, New York 10006,on which the Company’s common stock is listed.A copy of any of the Company’s filings with the SEC, or any of the agreements or other documents that constituteexhibits to those filings, can be obtained by request directed to the Company at the following address and telephone number:Avnet, Inc.2211 South 47 StreetPhoenix, Arizona 85034(480) 643-2000Attention: Corporate SecretaryThe Company also makes these filings available, free of charge, through its website (see “Avnet Website” below).6 th Table of ContentsAvnet WebsiteIn addition to the information about the Company contained in this Report, extensive information about the Companycan be found at http://www.avnet.com, including information about its management team, products and services andcorporate governance practices.The corporate governance information on the Company website includes the Company’s Corporate GovernanceGuidelines, the Code of Conduct and the charters for each of the committees of its Board of Directors. In addition,amendments to the Code of Conduct, committee charters and waivers granted to directors and executive officers under theCode of Conduct, if any, will be posted in this area of the website. These documents can be accessed at http://www.avnet.comunder the “Company — Investor Relations — Documents & Charters” caption. Printed versions of the Corporate GovernanceGuidelines, Code of Conduct and charters of the Board committees can be obtained, free of charge, by writing to theCompany at the address listed above in “Available Information.”In addition, the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports, if any, filed or furnished pursuant to Section 13(a) or 15(d) of Securities Exchange Act of1934, as well as Section 16 filings made by any of the Company’s executive officers or directors with respect to theCompany’s common stock, are available on the Company’s website (http://www.avnet.com under the “Company — InvestorRelations — SEC Filings” caption) as soon as reasonably practicable after the report is electronically filed with, or furnishedto, the Securities and Exchange Commission.These details about the Company’s website and its content are only for information. The contents of the Company’swebsite are not, nor shall they be deemed to be, incorporated by reference in this Report. Item 1A. Risk FactorsForward-Looking Statements and Risk FactorsThis Report contains forward-looking statements with respect to the financial condition, results of operations andbusiness of Avnet. These statements are generally identified by words like “believes,” “plans,” “expects,” “anticipates,”“should,” “will,” “may,” “estimates” or similar expressions. Forward-looking statements are subject to numerousassumptions, risks and uncertainties. Except as required by law, Avnet does not undertake any obligation to update anyforward-looking statements, whether as a result of new information, future events or otherwise. Factors that may cause actualresults to differ materially from those contained in the forward-looking statements include those discussed below.The factors discussed below make the Company’s operating results for future periods difficult to predict and, therefore,prior results are not necessarily indicative of results to be expected in future periods. Any of the below factors, or any otherfactors discussed elsewhere in this Report, may have an adverse effect on the Company’s financial results, operations,prospects and liquidity. The Company’s operating results have fluctuated in the past and likely will continue to do so. If theCompany’s operating results fall below its forecasts and the expectations of public market analysts and investors, the tradingprice of the Company’s common stock will likely decrease.Economic weakness and geopolitical uncertainty could adversely affect the Company’s results and prospects.The Company’s financial results, operations and prospects depend significantly on worldwide economic andgeopolitical conditions, the demand for its products and services, and the financial condition of its customers and suppliers.Economic weakness and geopolitical uncertainty have in the past resulted, and may result in the future, in decreased sales,margins and earnings. Economic weakness and geopolitical uncertainty may also lead the Company to impair assets,including goodwill, intangible assets and other long-lived assets, take restructuring actions and reduce expenses in response7 Table of Contentsto decreased sales or margins. The Company may not be able to adequately adjust its cost structure in a timely fashion, whichmay adversely impact its profitability. Uncertainty about economic conditions may increase foreign currency volatility inmarkets in which the Company transacts business, which may negatively impact the Company’s results. Economic weaknessand geopolitical uncertainty also make it more difficult for the Company to manage inventory levels and/or collect customerreceivables, which may result in provisions to create reserves, write-offs, reduced access to liquidity and higher financingcosts.The Company experiences significant competitive pressure, which may negatively impact its results.The market for the Company’s products and services is very competitive and subject to rapid technological advances,new market entrants, non-traditional competitors, changes in industry standards and changes in customer needs andconsumption models. Not only does the Company compete with other global distributors, it also competes for customers withregional distributors and some of the Company’s own suppliers that maintain direct sales efforts. In addition, as the Companyexpands its offerings and geographies, the Company may encounter increased competition from current or new competitors.The Company’s failure to maintain and enhance its competitive position could adversely affect its business and prospects.Furthermore, the Company’s efforts to compete in the marketplace could cause deterioration of gross profit margins and, thus,overall profitability.The size of the Company’s competitors vary across market sectors, as do the resources the Company has allocated to thesectors and geographic areas in which it does business. Therefore, some competitors may have greater resources or a moreextensive customer or supplier base than the Company has in one or more of its market sectors and geographic areas, whichmay result in the Company not being able to effectively compete in certain markets which could impact the Company’sprofitability and prospects.Changes in customer needs and consumption models could significantly affect the Company’s operating results.Changes in customer needs and consumption models may cause a decline in the Company’s billings, which wouldhave a negative impact on the Company’s financial results. While the Company attempts to identify changes in marketconditions as soon as possible, the dynamics of these industries make prediction of, and timely reaction to such changesdifficult. Future downturns in the semiconductor and embedded solutions industries could adversely affect the Company’soperating results and negatively impact the Company’s ability to maintain its current profitability levels. In addition, thesemiconductor industry has historically experienced periodic fluctuations in product supply and demand, often associatedwith changes in economic conditions, technology and manufacturing capacity. During fiscal years 2018, 2017, and 2016,sales of semiconductors represented approximately 78%, 78%, and 83% of the Company's consolidated sales, respectively,and the Company’s sales closely follow the strength or weakness of the semiconductor industry.Due to the Company’s increased online sales, system interruptions and delays that make its websites and servicesunavailable or slow to respond may reduce the attractiveness of its products and services to its customers. If the Company isunable to continually improve the efficiency of its systems, it could cause systems interruptions or delays and adverselyaffect the Company’s operating results.Failure to maintain or develop new relationships with key suppliers could adversely affect the Company’s sales.One of the Company’s competitive strengths is the breadth and quality of the suppliers whose products the Companydistributes. However, billings of products and services from one of the Company’s suppliers, Texas Instruments (“TI”),accounted for approximately 11% of the Company’s consolidated billings in fiscal 2018. Management expects TI’s productsand services to continue to account for roughly a similar percentage of the Company’s consolidated billings in fiscal 2019.The Company’s contracts with its suppliers vary in duration and are generally terminable by either party at will upon notice.To the extent any primary suppliers terminate or significantly reduce their volume of business with the8 Table of ContentsCompany in the future, because of a product shortage, an unwillingness to do business with the Company, changes instrategy or otherwise, the Company’s business and relationships with its customers could be negatively affected because itscustomers depend on the Company’s distribution of technology hardware and software from the industry’s leading suppliers.In addition, suppliers’ strategy shifts or performance issues may negatively affect the Company’s financial results. Thecompetitive landscape has also experienced a consolidation among suppliers, which could negatively impact the Company’sprofitability and customer base. Further, to the extent that any of the Company’s key suppliers modify the terms of theircontracts including, without limitation, the terms regarding price protection, rights of return, rebates or other terms thatprotect or enhance the Company’s gross margins, it could negatively affect the Company’s results of operations, financialcondition or liquidity.The Company’s non-U.S. locations represent a significant portion of its sales and, consequently, the Company is exposed torisks associated with operating internationally that could adversely affect the Company’s operating results.During fiscal 2018, 2017 and 2016 approximately 76%, 72% and 73%, respectively, of the Company’s sales came fromits operations outside the United States. As a result of the Company’s international operations, in particular those inemerging and developing economies, the Company’s operations are subject to a variety of risks that are specific tointernational operations, including, but not limited to, the following:·potential restrictions on the Company’s ability to repatriate funds from its foreign subsidiaries;·foreign currency and interest rate fluctuations and the impact on the Company’s results of operations;·compliance with foreign and domestic import and export regulations, data privacy regulations, business licensingrequirements, environmental regulations and anti-corruption laws, the failure of which could result in severepenalties including monetary fines, criminal proceedings and suspension of import or export privileges;·adoption or expansion of trade restrictions, including new and higher duties, tariffs, surcharges, or otherimport/export controls, unilaterally or bilaterally;·complex and changing tax laws and regulations;·regulatory requirements and prohibitions that differ between jurisdictions;·economic and political instability (including the uncertainty caused by the United Kingdom’s exit from theEuropean Union), terrorism and potential military conflicts or civilian unrest;·fluctuations in freight costs, limitations on shipping and receiving capacity, and other disruptions in thetransportation and shipping infrastructure;·natural disasters and health concerns;·differing environmental regulations and employment practices and labor issues; and·the risk of non-compliance with local laws.In addition to the cost of compliance, the potential criminal penalties for violations of import or export regulations andanti-corruption laws by the Company or its third-party agents create heightened risks for the Company’s internationaloperations. In the event that a governing regulatory body determines that the Company has violated applicable import orexport regulations or anti-corruption laws, the Company could be fined significant sums, incur sizable legal defense costsand/or its import or export capabilities could be restricted, which could have a material and adverse effect on the Company’sbusiness. Additionally, allegations that the Company has violated a governmental regulation may negatively impact theCompany’s reputation, which may result in customers or suppliers being unwilling to do business with the Company. While9 Table of Contentsthe Company has adopted measures and controls designed to ensure compliance with these laws, the Company cannot beassured that such measures will be adequate or that its business will not be materially and adversely impacted in the event ofan alleged violation.The Company transacts sales, pays expenses, owns assets and incurs liabilities in countries using currencies other thanthe U.S. Dollar. Because the Company’s consolidated financial statements are presented in U.S. Dollars, the Company musttranslate sales, income and expenses, as well as assets and liabilities, into U.S. Dollars at exchange rates in effect during eachreporting period. Therefore, increases or decreases in the exchange rates between the U.S. Dollar and other currencies affectthe Company’s reported amounts of sales, operating income, assets and liabilities denominated in foreign currencies. Inaddition, unexpected and dramatic changes in foreign currency exchange rates may negatively affect the Company’searnings from those markets. While the Company may use derivative financial instruments to further reduce its net exposureto foreign currency exchange rate fluctuations, there can be no assurance that fluctuations in foreign currency exchange rateswill not materially affect the Company’s financial results. Further, foreign currency instability and disruptions in the creditand capital markets may increase credit risks for some of the Company’s customers and may impair its customers’ ability torepay existing obligations.Recently, the U.S. government imposed new or higher tariffs on certain products imported into the U.S., which haveincreased the costs of procuring certain products the Company purchases from its suppliers. The higher tariffs, along with anyadditional tariffs or trade restrictions that may be implemented by the U.S. or by other countries on U.S. goods in the future,may result in further increased costs and other related expenses. While the Company intends to reflect such increased costsin its selling prices, such price increases may impact the Company’s sales and customer demand for certain products. Inaddition, increased operational expenses incurred in minimizing the number of products subject to the tariffs could adverselyaffect the operating profits for certain of its business units. Neither such U.S. tariffs nor any retaliatory tariffs imposed byother countries on U.S. goods have yet had a significant impact, but there can be no assurance that future actions orescalations that affect trade relations will not occur or will not materially affect the Company’s sales and results ofoperations. To the extent that Company sales or profitability are negatively affected by any such tariffs or other trade actions,the Company’s business and results of operations may be materially adversely affected.If the Company’s internal information systems fail to function properly, or if the Company is unsuccessful in theimplementation, integration or upgrade of information systems, its business operations could suffer.The Company is dependent on its information systems to facilitate the day-to-day operations of the business and toproduce timely, accurate and reliable information on financial and operational results. Currently, the Company’s globaloperations are tracked with multiple information systems, some of which are subject to ongoing IT projects designed tostreamline or optimize the Company’s global information systems. These IT projects are extremely complex, in part, becauseof a wide range of processes, the multiple legacy systems used and the Company’s business operations. There is no guaranteethat the Company will be successful at all times in these efforts or that there will not be implementation or integrationdifficulties that will adversely affect the Company’s ability to complete business transactions and ensure accurate recordingand reporting of financial data. In addition, the Company may be unable to achieve the expected efficiencies and costsavings as a result of the IT projects, thus negatively impacting the Company’s financial results. A failure of any of theseinformation systems in a way described above or material difficulties in upgrading these information systems could have anadverse effect on the Company’s business, internal controls and reporting obligations under federal securities laws.The Company’s acquisition strategy may not produce the expected benefits, which may adversely affect the Company’sresults of operations.Avnet has made, and expects to continue to make, strategic acquisitions or investments in companies around the worldto further its strategic objectives and support key business initiatives. Acquisitions and investments involve risks10 Table of Contentsand uncertainties, some of which may differ from those associated with Avnet’s historical operations. The risks relating tosuch acquisitions and investments include, but are not limited to, risks relating to expanding into emerging markets andbusiness areas, adding additional product lines and services, impacting existing customer and supplier relationships,incurring costs or liabilities associated with the companies acquired, incurring potential impairment charges on acquiredgoodwill and other intangible assets and diverting management’s attention from existing business operations. As a result, theCompany’s profitability may be negatively impacted. In addition, the Company may not be successful in integrating theacquired businesses or the integration may be more difficult, costly or time-consuming than anticipated. Further, anylitigation relating to a potential acquisition will result in an increase in the expenses associated with the acquisition or causea delay in completing the acquisition, thereby impacting the Company’s profitability. The Company may experiencedisruptions that could, depending on the size of the acquisition, have an adverse effect on its business, especially where anacquisition target may have pre-existing compliance issues or pre-existing deficiencies or material weaknesses in internalcontrols over financial reporting. Furthermore, the Company may not realize all of the anticipated benefits from itsacquisitions, which could adversely affect the Company’s financial performance.Major disruptions to the Company’s logistics capability could have an adverse impact on the Company’s operations.The Company’s global logistics services are operated through specialized, centralized or outsourced distributioncenters around the globe. The Company also depends almost entirely on third-party transportation service providers for thedelivery of products to its customers. A major interruption or disruption in service at one or more of its distribution centersfor any reason (such as information technology upgrades and operating issues, warehouse modernization and relocationefforts, natural disasters, pandemics, or significant disruptions of services from the Company’s third-party transportationproviders) could cause cancellations or delays in a significant number of shipments to customers and, as a result, could havean adverse impact on the Company’s business partners, and on the Company’s business, operations and financialperformance.If the Company sustains cyber-attacks or other privacy or data security incidents that result in security breaches, it couldsuffer a loss of sales and increased costs, exposure to significant liability, reputational harm and other negativeconsequences.The Company’s information technology may be subject to cyber-attacks, security breaches or computer hacking.Experienced computer programmers and hackers may be able to penetrate the Company’s security controls andmisappropriate or compromise sensitive personal, proprietary or confidential information, create system disruptions or causeshutdowns. They also may be able to develop and deploy malicious software programs that attack the Company’s systems orotherwise exploit any security vulnerabilities. The Company’s systems and the data stored on those systems may also bevulnerable to security incidents or security attacks, acts of vandalism or theft, coordinated attacks by activist entities,misplaced or lost data, human errors, or other similar events that could negatively affect the Company’s systems and its data,as well as the data of the Company’s business partners. Further, third parties, such as hosted solution providers, that provideservices to the Company, could also be a source of security risk in the event of a failure of their own security systems andinfrastructure.The costs to eliminate or address the foregoing security threats and vulnerabilities before or after a cyber-incident couldbe significant. The Company’s remediation efforts may not be successful and could result in interruptions, delays orcessation of service, and loss of existing or potential suppliers or customers. In addition, breaches of the Company’s securitymeasures and the unauthorized dissemination of sensitive personal, proprietary or confidential information about theCompany, its business partners or other third parties could expose the Company to significant potential liability andreputational harm. As threats related to cyber-attacks develop and grow, the Company may also find it necessary to makefurther investments to protect its data and infrastructure, which may impact the Company’s profitability. Although theCompany has insurance coverage for protecting against cyber-attacks, it may not be sufficient to cover all possible claims,11 Table of Contentsand the Company may suffer losses that could have a material adverse effect on its business. As a global enterprise, theCompany could also be negatively impacted by existing and proposed laws and regulations, as well as government policiesand practices related to cybersecurity, data privacy, data localization and data protection.Declines in the value of the Company’s inventory or unexpected order cancellations by the Company’s customers couldadversely affect its business, results of operations, financial condition and liquidity.The electronic components and integrated products industries are subject to rapid technological change, new andenhanced products, changes in customer needs and changes in industry standards and regulatory requirements, which cancontribute to a decline in value or obsolescence of inventory. Regardless of the general economic environment, it is possiblethat prices will decline due to a decrease in demand or an oversupply of products and, as a result of the price declines, theremay be greater risk of declines in inventory value. Although it is the policy of many of the Company’s suppliers to offercertain protections from the loss in value of inventory (such as price protection and limited rights of return), the Companycannot be assured that such policies will fully compensate for the loss in value, or that the suppliers will choose to, or be ableto, honor such agreements, some of which are not documented and, therefore, subject to the discretion of the supplier. Inaddition, the majority of the Company’s sales are made pursuant to individual purchase orders, rather than through long-termsales contracts. Where there is a contract, such contract is generally terminable at will upon notice. The Company cannot beassured that unforeseen new product developments, declines in the value of the Company’s inventory or unforeseen ordercancellations by its customers will not adversely affect the Company’s business, results of operations, financial condition orliquidity.Substantial defaults by the Company’s customers or suppliers on its accounts receivable or the loss of significant customerscould have a significant negative impact on the Company’s business, results of operations, financial condition or liquidity.A significant portion of the Company’s working capital consists of accounts receivable. If entities responsible for asignificant amount of accounts receivable were to cease doing business, direct their business elsewhere, become insolvent orunable to pay the amount they owe the Company, or were to become unwilling or unable to make such payments in a timelymanner, the Company’s business, results of operations, financial condition or liquidity could be adversely affected. Aneconomic or industry downturn could adversely affect the collectability of these accounts receivable, which could result inlonger payment cycles, increased collection costs and defaults in excess of management’s expectations. A significantdeterioration in the Company’s ability to collect on accounts receivable in the United States could also impact the cost oravailability of financing under its accounts receivable securitization program.The Company may not have adequate or cost-effective liquidity or capital resources which could adversely affect theCompany’s operations.The Company’s ability to satisfy its cash needs and implement its capital allocation strategy depends on its ability togenerate cash from operations and to access the financial markets, both of which are subject to general economic, financial,competitive, legislative, regulatory and other factors that are beyond the Company’s control.The Company may need to satisfy its cash needs through external financing. However, external financing may not beavailable on acceptable terms or at all. As of June 30, 2018, Avnet had total debt outstanding of approximately $1.65 billionunder various notes, secured borrowings and committed and uncommitted lines of credit with financial institutions. TheCompany needs cash to make interest payments on, and to repay, this indebtedness and for general corporate purposes, suchas funding its ongoing working capital and capital expenditure needs. Under the terms of any external financing, theCompany may incur higher than expected financing expenses and become subject to additional restrictions and covenants.Any material increase in the Company’s financing costs could have an adverse effect on its profitability.12 Table of ContentsUnder certain of its credit facilities, the Company is required to maintain certain specified financial ratios and passcertain financial tests. If the Company fails to meet these financial ratios and/or pass these tests, it may be unable to continueto utilize these facilities. If the Company is unable to utilize these facilities, it may not have sufficient cash available to makeinterest payments, to repay indebtedness or for general corporate needs. General economic or business conditions, domesticand foreign, may be less favorable than management expects and could adversely impact the Company’s sales or its ability tocollect receivables from its customers, which may impact access to the Company’s accounts receivable securitizationprogram.In order to be successful, the Company must attract, retain, train, motivate and develop key employees, and failure to do socould adversely impact the Company’s results and strategic initiatives.Identifying, developing internally or hiring externally, training and retaining qualified employees are critical to theCompany’s future, and competition for experienced employees in the Company’s industry can be intense. Changingdemographics and labor work force trends may result in a loss of knowledge and skills as experienced workers leave theCompany. In addition, as global opportunities and industry demand shifts, and as the Company expands its offerings,realignment, training and hiring of skilled personnel may not be sufficiently rapid. From time to time the Company haseffected restructurings, which eliminate a number of positions. Even if such personnel are not directly affected by therestructuring effort, such terminations can have a negative impact on morale and the Company’s ability to attract and hirenew qualified personnel in the future. If the Company loses existing qualified personnel or is unable to hire new qualifiedpersonnel, as needed, the Company’s business, financial condition and results of operations could be seriously harmed.The agreements governing some of the Company’s financings contain various covenants and restrictions that limitmanagement’s discretion in operating the business and could prevent management from engaging in some activities thatmay be beneficial to the Company’s business.The agreements governing the Company’s financing, including its credit facility, accounts receivable securitizationprogram and the indentures governing the Company’s outstanding notes, contain various covenants and restrictions that, incertain circumstances, limit the Company’s ability, and the ability of certain subsidiaries, to:·grant liens on assets;·make restricted payments (including, under certain circumstances, paying dividends on common stock orredeeming or repurchasing common stock);·make certain investments;·merge, consolidate or transfer all or substantially all of the Company’s assets;·incur additional debt; or·engage in certain transactions with affiliates.As a result of these covenants and restrictions, the Company may be limited in the future in how it conducts its businessand may be unable to raise additional debt, repurchase common stock, pay a dividend, compete effectively or make furtherinvestments.The Company may become involved in legal proceedings that could cause it to incur substantial costs, divertmanagement’s efforts or require it to pay substantial damages or licensing fees.From time to time, the Company may become involved in legal proceedings, including government investigations, thatarise out of the ordinary conduct of the Company’s business, including matters involving intellectual property rights,commercial matters, merger-related matters and other actions. Legal proceedings could result in substantial costs and13 Table of Contentsdiversion of management’s efforts and other resources and could have an adverse effect on the Company’s operations.Further, the Company may be obligated to indemnify and defend its customers if the products or services the Company sellsare alleged to infringe any third party’s intellectual property rights. While the Company may be able to seek indemnificationfrom its suppliers for itself and its customers against such claims, there is no assurance that it will be successful in realizingsuch indemnification or that the Company will be fully protected against such claims. In addition, the Company is exposedto potential liability for technology that it develops for which it has no indemnification protections. If an infringement claimagainst the Company is successful, the Company may be required to pay damages or seek royalty or license arrangements,which may not be available on commercially reasonable terms. The Company may have to stop selling certain products orservices, which could affect its ability to compete effectively.Changes in tax rules and regulations, changes in interpretation of tax rules and regulations, changes in businessperformance or unfavorable assessments from tax audits could adversely affect the Company’s effective tax rates, deferredtaxes, financial condition and results of operations.As a multinational corporation, the Company is subject to the tax laws and regulations of the United States and manyforeign jurisdictions. From time to time, regulations may be enacted that could adversely affect the Company’s tax positions.There can be no assurance that the Company’s cash flow, and in some cases the effective tax rate, will not be adverselyaffected by these potential changes in regulations or by changes in the interpretation of existing tax law and regulations.On December 22, 2017, the U.S. federal government enacted tax legislation (the “Tax Cuts and Jobs Act” or the “Act”)which includes provisions to lower the corporate income tax rate, impose new taxes on certain foreign earnings, limitdeductibility of certain U.S. costs and levy a one-time deemed repatriation tax on accumulated offshore earnings, amongothers. The Act is subject to interpretation and implementation guidance by both federal and state tax authorities, as well asamendments and technical corrections. Any or all of these could impact the Company unfavorably. Many countries are adopting provisions to align their international tax rules with the Base Erosion and Profit ShiftingProject, led by the Organisation for Economic Co-operation and Development, to standardize and modernize globalcorporate tax policy. These provisions, individually or as a whole, may negatively impact taxation of international business.The tax laws and regulations of the various countries where the Company has operations are extremely complex andsubject to varying interpretations. Although the Company believes that its historical tax positions are sound and consistentwith applicable laws, regulations and existing precedent, there can be no assurance that these tax positions will not bechallenged by relevant tax authorities or that the Company would be successful in defending against any such challenge.The Company’s future income tax expense could also be favorably or adversely affected by changes in the mix ofearnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities andchanges to its operating structure.If the Company fails to maintain effective internal controls, it may not be able to report its financial results accurately ortimely, or prevent or detect fraud, which could have an adverse effect on the Company’s business or the market price of theCompany’s securities.Effective internal controls over financial reporting are necessary for the Company to provide reliable financial reportsand to effectively prevent or detect fraud. If the Company cannot provide reliable financial reports and effectively prevent ordetect fraud, its brand and operating results could be harmed. Internal controls over financial reporting may not prevent ordetect misstatements because such controls are inherently limited; such limitations include the possibility of human error,the circumvention or overriding of controls, or fraud. Therefore, even effective internal controls cannot provide absoluteassurance with respect to the preparation and fair presentation of financial statements. In addition, if not properly maintainedand updated, internal controls over financial reporting may become inadequate. If the Company fails14 Table of Contentsto maintain the adequacy of its internal controls, including any failure to implement required new or improved internalcontrols, or if the Company experiences difficulties in their implementation, the Company’s business and operating resultscould be harmed. Additionally, the Company may be subject to sanctions or investigations by regulatory authorities, and theCompany could fail to meet its reporting obligations, all of which could have an adverse effect on its business or the marketprice of the Company’s securities.Failure to comply with the requirements of environmental regulations could adversely affect the Company’s business.The Company is subject to various federal, state, local and foreign laws and regulations addressing environmental andother impacts from product disposal, use of hazardous materials in products, recycling of products at the end of their usefullife and other related matters. While the Company strives to ensure it is in full compliance with all applicable regulations,certain of these regulations impose liability without fault. Additionally, the Company may be held responsible for the prioractivities of an entity it acquired. Failure to comply with these regulations could result in substantial costs, fines and civil orcriminal sanctions, as well as third-party claims for property damage or personal injury. Further, environmental laws maybecome more stringent over time, imposing greater compliance costs and increasing risks and penalties associated withviolations. Item 1B. Unresolved Staff CommentsNot applicable. Item 2. PropertiesThe Company owns and leases approximately 2.6 million and 4.6 million square feet of space, respectively, of whichapproximately 25% is located in the United States. The following table summarizes certain of the Company’s key facilities: Approximate Leased Square or Location Footage Owned Primary Use Poing, Germany 570,000 Owned EC warehousing, value-added operations and offices Chandler, Arizona 400,000 Owned EC warehousing and value-added operations Tongeren, Belgium 390,000 Owned EC warehousing and value-added operations Leeds, United Kingdom 330,000 Owned PF warehousing and headquarters Chandler, Arizona 230,000 Leased EC warehousing, integration and value-added operations Gaffney, South Carolina 220,000 Owned PF warehousing Hong Kong, China 180,000 Leased EC warehousing Phoenix, Arizona 180,000 Leased Corporate and EC Americas headquarters Item 3. Legal ProceedingsAs a result primarily of certain former manufacturing operations, Avnet has incurred and may have future liability undervarious federal, state and local environmental laws and regulations, including those governing pollution and exposure to,and the handling, storage and disposal of, hazardous substances. For example, under the Comprehensive EnvironmentalResponse, Compensation and Liability Act of 1980, as amended (“CERCLA”) and similar state laws, Avnet is and may beliable for the costs of cleaning up environmental contamination on or from certain of its current or former properties, and atoff-site locations where the Company disposed of wastes in the past. Such laws may impose joint and several liability.Typically, however, the costs for clean up at such sites are allocated among potentially responsible parties based upon eachparty’s relative contribution to the contamination, and other factors.Pursuant to SEC regulations, including but not limited to Item 103 of Regulation S-K, the Company regularly assessesthe status of and developments in pending environmental and other compliance related legal proceedings to determinewhether any such proceedings should be identified specifically in this discussion of legal proceedings, and has15 Table of Contentsconcluded that no particular pending legal proceeding requires public disclosure. Based on the information known to date,management believes that the Company has appropriately accrued in its consolidated financial statements for its share of theestimable costs of environmental and other compliance related matters.The Company is also currently subject to various pending and potential legal matters and investigations relating tocompliance with governmental laws and regulations, including import/export and environmental matters. The Companycurrently believes that the resolution of such matters will not have a material adverse effect on the Company’s financialposition or liquidity, but could possibly be material to its results of operations in any one reporting period. Item 4. Mine Safety DisclosuresNot applicable. PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity SecuritiesMarket Price Per Share and Dividend HistoryOn May 7, 2018, the Company received approval from the Nasdaq Stock Market to transfer the Company’s commonstock listing from the New York Stock Exchange to the Nasdaq Global Select Market effective May 8, 2018. The Company’scommon stock is currently listed on the Nasdaq Global Select Market under the symbol AVT. Quarterly high and low stockclosing prices (as reported on the Nasdaq Global Select Market or the New York Stock Exchange as applicable) anddividends declared for the last two fiscal years were: 2018 2017 Dividends Dividends Fiscal Quarters High Low Declared High Low Declared 1 $39.93 $35.93 $0.18 $42.06 $38.80 $0.17 2 41.72 38.67 0.18 48.84 40.50 0.17 3 44.71 39.62 0.19 47.61 44.01 0.18 4 43.52 38.12 0.19 44.96 35.96 0.18 The declaration and payment of future dividends will be at the discretion of the Board of Directors and will bedependent upon the Company’s financial condition, results of operations, capital requirements, and other factors the Boardof Directors considers relevant. In addition, certain of the Company’s debt facilities may restrict the declaration and paymentof dividends, depending upon the Company’s then current compliance with certain covenants.Record HoldersAs of July 27, 2018, there were 1,837 registered holders of record of Avnet’s common stock.16 stndrdth Table of ContentsEquity Compensation Plan InformationThe table below sets forth certain equity compensation plan information as of June 30, 2018: Number of Securities Number of to be Issued Weighted- Securities Upon Average Remaining Exercise of Exercise Price of Available for Outstanding Outstanding Future Issuance Options, Options, Under Equity Warrants and Warrants and Compensation Plan Category Rights Rights Plans Equity compensation plans approved by security holders 3,798,274$40.93 5,451,892(1)Includes 2,321,787 shares subject to options outstanding, 1,036,160 restricted stock units and 440,327 performanceshare units awarded but not yet vested as of the end of the fiscal year.(2)Does not include 97,487 shares available for future issuance under the Employee Stock Purchase Plan, which is a non-compensatory plan.17 (1) (2) Table of ContentsStock Performance Graphs and Cumulative Total ReturnsThe graph below matches the cumulative 5-year total return of holders of Avnet’s common stock with the cumulativetotal returns of the Nasdaq Composite index and a customized peer group of seven companies that includes: Agilysys Inc.,Anixter International Inc., Arrow Electronics Inc., Insight Enterprises Inc., Scansource Inc., Synnex Corp and Tech Data Corp.The graph assumes that the value of the investment in Avnet’s common stock, in each index, and in the peer group(including reinvestment of dividends) was $100 on 6/30/2013 and tracks it through 6/30/2018. 6/30/2013 6/30/2014 6/30/2015 6/30/2016 6/30/2017 6/30/2018 Avnet, Inc. $100 $133.79 $125.92 $126.10 $123.05 $138.25 Nasdaq Composite 100 132.45 151.00 148.88 189.66 233.12 Peer Group 100 147.46 131.11 143.85 189.07 171.46 The stock price performance included in this graph is not necessarily indicative of future stock price performance.18 Table of ContentsIssuer Purchases of Equity SecuritiesIn November 2017, the Company’s Board of Directors amended the Company’s existing share repurchase program toauthorize the repurchase of up to $1.95 billion of common stock in the open market or through privately negotiatedtransactions. The timing and actual number of shares repurchased will depend on a variety of factors such as share price,corporate and regulatory requirements, and prevailing market conditions. The following table includes the Company’smonthly purchases of Avnet’s common stock during the fourth fiscal quarter ended June 30, 2018, under the share repurchaseprogram, which is part of a publicly announced plan: Total Number of Approximate Dollar Total Average Shares Purchased Value of Shares That Number Price as Part of Publicly May Yet Be of Shares Paid per Announced Plans Purchased under the Period Purchased Share or Programs Plans or Programs April 1,182,070 $40.94 1,182,070 $341,206,000 May 1,350,410 $39.67 1,350,410 $287,634,000 June 364,905 $42.51 364,905 $272,121,000 19 Table of Contents Item 6. Selected Financial Data The following selected financial data has been derived from the Company’s consolidated financial statements. The dataset forth below should be read in conjunction with Management’s Discussion and Analysis of Financial Condition andResults of Operations and the consolidated financial statements and notes thereto. Years Ended June 30, July 1, July 2, June 27, June 28, 2018 2017 2016 2015 2014 (Millions, except for per share and ratio data) Consolidated Statement of Operations: Sales $19,036.9 $17,440.0 $16,740.6 $17,655.3 $16,804.9 Gross profit 2,527.2 2,369.4 2,077.9 2,210.1 2,199.6 Operating income 230.5 461.4 572.9 653.1 599.6 Income tax expense 288.0 47.1 87.1 86.1 84.6 (Loss) income from continuing operations (142.9) 263.4 390.9 485.4 445.4 (Loss) income from discontinued operations (13.5) 261.9 115.6 86.5 100.2 Net (loss) income (156.4) 525.3 506.5 571.9 545.6 Per Share: Earnings - diluted: (Loss) earnings from continuing operations (1.19) 2.05 2.93 3.50 3.18 (Loss) earnings from discontinued operations (0.11) 2.03 0.87 0.62 0.71 (Loss) earnings per share - diluted (1.30) 4.08 3.80 4.12 3.89 Cash dividends declared 0.74 0.70 0.68 0.64 0.60 Book value per diluted share 39.07 40.28 35.23 33.80 34.90 Consolidated Balance Sheets: Working capital 4,641.1 5,080.0 4,061.5 4,312.6 3,907.6 Total assets 9,596.8 9,699.6 11,239.8 10,800.0 11,250.7 Long-term debt 1,489.2 1,729.2 1,339.2 1,646.5 1,209.0 Shareholders’ equity 4,685.1 5,182.1 4,691.3 4,685.0 4,890.2 Ratios: Operating income as a percentage of sales 1.2% 2.6% 3.4% 3.7% 3.6% Net (loss) income as a percentage of sales (0.8)% 3.0% 3.0% 3.2% 3.2% Quick ratio 1.4:1 1.8:1 0.8:1 0.9:1 0.8:1 Current ratio 2.6:1 3.1:1 1.8:1 2.0:1 1.8:1 Total debt to capital ratio 26.1% 25.6% 34.7% 29.7% 29.8% (a)In February 2017, the Company completed the sale of its TS business and as such, the results of that business areclassified as discontinued operations in all periods presented.(b)Fiscal 2016 contained 53 weeks compared to 52 weeks in the other fiscal years presented.(c)All fiscal years presented include restructuring, integration and other expenses, which totaled $145.1 million in fiscal2018, $137.4 million in fiscal 2017, $44.8 million in fiscal 2016, $41.8 million in fiscal 2015, and $66.8 million infiscal 2014.(d)All fiscal years presented include amortization of acquired intangible assets and other, which totaled $91.9 million infiscal 2018, $54.5 million in fiscal 2017, $9.8 million in fiscal 2016, $18.1 million in fiscal 2015, and $17.7 million infiscal 2014.20 (a)(b)(c)(d)(e)(f) Table of Contents(e)Certain fiscal years presented were impacted by expense or income amounts that impact the comparability betweenyears including a goodwill impairment expense of $181.4 million and a one-time mandatory deemed repatriation taxliability of $230.0 million in fiscal 2018, a gain on disposal of the TS business of $222.4 million after tax in fiscal2017, and a gain on legal settlement of $13.5 million after tax in fiscal 2014.(f)This calculation of working capital is defined as current assets less current liabilities. See the “Liquidity”section contained in Item 7 of this Annual Report on Form 10-K for further discussion on liquidity.Summary of quarterly results: First Second Third Fourth Fiscal Quarter Quarter Quarter Quarter Year (Millions, except per share amounts) 2018 Sales $4,660.9 $4,521.6 $4,795.1 $5,059.2 $19,036.9 Gross profit 612.6 602.5 653.5 658.6 2,527.2 Net income (loss) 58.3 46.7 (320.1) 58.6 (156.4) Diluted earnings (loss) per share 0.47 0.39 (2.68) 0.50 (1.30) 2017 Sales $4,118.1 $4,273.6 $4,441.9 $4,606.4 $17,440.0 Gross profit 522.6 586.2 630.0 630.6 2,369.4 Net income 68.9 103.2 271.8 81.4 525.3 Diluted earnings per share 0.53 0.79 2.10 0.65 4.08 (a)Quarters may not total to the fiscal year due to rounding.(b)First quarter of fiscal 2018 net income was impacted by restructuring, integration and other expenses of $29.6 millionafter tax, foreign currency gain and other expense of $6.5 million after tax and a discrete income tax benefit of $6.9million. Second quarter results were impacted by restructuring, integration and other expenses of $27.8 million after taxand a discrete income tax benefit of $8.0 million. Third quarter results were impacted by restructuring, integration andother expenses of $19.4 million after tax, a goodwill impairment of $181.4 million and a discrete income tax expense of$218.8 million. Fourth quarter results were impacted by restructuring, integration and other expenses of $26.9 millionafter tax and a discrete income tax expense of $14.5 million. (c)First quarter of fiscal 2017 net income was impacted by restructuring, integration and other expenses of $20.2 millionafter tax and a discrete income tax benefit of $1.4 million. Second quarter results were impacted by restructuring,integration and other expenses of $23.0 million after tax and a discrete income tax expense of $9.4 million. Thirdquarter results were impacted by restructuring, integration and other expenses of $23.1 million after tax, the gain on saleof the TS business of $217.1 million after tax, a gain on marketable securities of $8.4 million after tax and a discreteincome tax benefit of $7.7 million. Fourth quarter results were impacted by restructuring, integration and other expensesof $25.7 million after tax, a loss on a marketable securities hedge of $7.8 million after tax, and a discrete income taxbenefit of $15.0 million. 21 (a)(b)(c) Table of Contents Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsFor an understanding of Avnet and the significant factors that influenced the Company’s performance during the pastthree fiscal years, the following discussion should be read in conjunction with the description of the business appearing inItem 1 of this Report and the consolidated financial statements, including the related notes and schedule, and otherinformation appearing in Item 15 of this Report. The Company operates on a “52/53 week” fiscal year. Fiscal 2018 and 2017both contained 52 weeks, and fiscal 2016 contained 53 weeks. The extra week impacts the year-over-year analysis of fiscal2016 compared to fiscal 2018 and fiscal 2017 in this MD&A.There are references to the impact of foreign currency translation in the discussion of the Company’s results ofoperations. When the U.S. Dollar strengthens and the stronger exchange rates of the current year are used to translate theresults of operations of Avnet’s subsidiaries denominated in foreign currencies, the resulting impact is a decrease in U.S.Dollars of reported results. Conversely, when the U.S. Dollar weakens and the weaker exchange rates of the current year areused to translate the results of operations of Avnet’s subsidiaries denominated in foreign currencies, the resulting impact is anincrease in U.S. Dollars of reported results. In the discussion that follows, results excluding this impact, primarily forsubsidiaries in EMEA and Asia, are referred to as “constant currency.”In addition to disclosing financial results that are determined in accordance with generally accepted accountingprinciples in the U.S. (“GAAP”), the Company also discloses certain non-GAAP financial information, including:·Sales adjusted for certain items that impact the year-over-year analysis, which includes the impact of certainacquisitions by adjusting Avnet’s prior periods to include the sales of acquired businesses, as if the acquisitionshad occurred at the beginning of the earliest period presented. In addition, the prior year sales are adjusted fordivestitures by adjusting Avnet’s prior periods to exclude the sales of divested businesses as if the divestitures hadoccurred at the beginning of the earliest period presented. Fiscal 2016 sales are adjusted for the estimated impact ofthe extra week of sales in fiscal 2016 as discussed above. Sales taking into account these adjustments are referred toas “organic sales.”·Operating income excluding (i) restructuring, integration and other expenses (see Restructuring, Integration andOther Expenses in this MD&A), (ii) goodwill impairment expense and (iii) amortization of acquired intangibleassets and other is referred to as “adjusted operating income.” Adjusted operating income excludes the TS business,which is reported within discontinued operations for all periods presented.The reconciliation of operating income to adjusted operating income is presented in the following table: Years Ended June 30, July 1, July 2, 2018 2017 2016 (Thousands) Operating income $230,516 $461,400 $572,912 Restructuring, integration and other expenses 145,125 137,415 44,761 Goodwill impairment expense 181,440 — — Amortization of acquired intangible assets and other 91,923 54,526 9,784 Adjusted operating income $649,004 $653,341 $627,457 22 Table of ContentsManagement believes that providing this additional information is useful to readers to better assess and understandoperating performance, especially when comparing results with prior periods or forecasting performance for future periods,primarily because management typically monitors the business both including and excluding these adjustments to GAAPresults. Management also uses these non-GAAP measures to establish operational goals and, in many cases, for measuringperformance for compensation purposes. However, any analysis of results on a non-GAAP basis should be used as acomplement to, and in conjunction with, results presented in accordance with GAAP. Results of OperationsExecutive SummarySales for fiscal 2018 were $19.04 billion, an increase of 9.2% from fiscal 2017 sales of $17.44 billion primarily due tothe acquisition of PF and the impact of foreign currency exchange rates, partially offset by certain supplier channel andprogram changes. EC sales in fiscal 2018 were $17.5 billion, representing a 6.5% increase over fiscal 2017 as sales growth inthe EMEA and Asia regions offset declines in the Americas region. Organic sales in constant currency increased 3.6% yearover year with both the EC and PF operating groups contributing to this increase.Gross profit in fiscal 2018 was $2.53 billion, an increase of $157.7 million, or 6.7%, compared to fiscal 2017. Thisincrease was primarily due to the acquisition of PF and the impact of changes in foreign currency exchange rates, partiallyoffset by certain supplier channel and program changes. Operating income margin was 1.2% in fiscal 2018 and 2.6% in fiscal 2017. Both periods included amortization andrestructuring, integration and other expenses. Fiscal 2018 also includes goodwill impairment expense. Excluding theseexpenses, adjusted operating income margin was 3.4% and 3.7% in fiscal 2018 and fiscal 2017, respectively. SalesThree-Year Analysis of Sales: By Operating Group and GeographyThe table below provides a year-over-year summary of sales for the Company and its operating groups. Years Ended Percent Change June 30, % of July 1, % of July 2, % of 2018 to 2017 to 2018 Total 2017 Total 2016 Total 2017 2016 (Dollars in millions) Sales by Operating Group: EC $17,543.6 92.2% $16,474.1 94.5% $16,740.6 100.0% 6.5% (1.6)% PF (acquired Q2 fiscal 2017) 1,493.3 7.8 965.9 5.5 — 54.6 — $19,036.9 $17,440.0 $16,740.6 Sales by Geographic Region: Americas $5,011.4 26.3% $5,163.9 29.6% $4,801.3 28.7% (3.0)% 7.6%EMEA 6,790.9 35.7 5,912.9 33.9 5,103.0 30.5 14.8 15.9 Asia/Pacific 7,234.6 38.0 6,363.2 36.5 6,836.3 40.8 13.7 (6.9) Total Avnet $19,036.9 $17,440.0 $16,740.6 23 Table of ContentsFiscal 2018 Comparison to Fiscal 2017During October of fiscal 2017, the Company acquired PF. The table below provides a comparison of reported andorganic sales for fiscal 2018 to fiscal 2017 sales to allow readers to better assess and understand the Company’s salesperformance by operating group on a more comparable basis. Organic Sales Sales as Reported Sales Organic Organic Year-Year% and Organic as Reported Sales Sales Change in Fiscal Fiscal Fiscal Year-Year Constant 2018 2017 Acquisitions 2017 % Change Currency (Dollars in millions) Avnet $19,036.9 $17,440.0 $378.3 $17,818.3 6.8% 3.6%Avnet by region Americas $5,011.4 $5,163.9 $154.4 $5,318.3 (5.8)% (5.8)%EMEA 6,790.9 5,912.9 178.9 6,091.8 11.5 2.5 Asia 7,234.6 6,363.2 45.0 6,408.2 12.9 12.7 Avnet by segment EC $17,543.6 $16,474.1 $ — $16,474.1 6.5% 3.4%PF 1,493.3 965.9 378.3 1,344.2 11.1 6.5 (1)Includes PF acquired on October 17, 2016, which has operations in each Avnet region.Avnet’s sales for fiscal 2018 were $19.04 billion, up $1.6 billion, or 9.2%, from fiscal 2017 sales of $17.44 billion. Thesales growth was primarily driven by the acquisition of PF and the impact of changes in foreign currency exchange rates asapproximately $575 million of the increase in sales was attributable to the translation impact of changes in foreign currencyexchange rates, primarily in EMEA. These increases in sales were partially offset by the impact of supplier channel andprogram changes, which occurred during fiscal 2017 into the first half of fiscal 2018. On an organic basis and in constantcurrency, consolidated sales increased 3.6% with both operating groups contributing to the increase. EC sales in fiscal 2018 were $17.5 billion, representing a 6.5% increase over fiscal 2017 sales. On an organic basis inconstant currency, EC sales increased 3.4% year-over-year as sales growth in the EMEA and Asia regions offset a 6.7%decline in the Americas region resulting primarily from supplier channel and program changes. Sales in the EMEA and Asiaregions increased in constant currency 2.0% and 12.5%, respectively, which was primarily driven by strong demand acrossmany product verticals, partially offset by declines from supplier channel and program changes. PF sales in fiscal 2018 increased on an organic basis 11.1% and 6.5% in constant currency with all three geographicregions contributing to the increase. The organic increase in each of the three regions is primarily due to the expansion of thePF line-card and an investment in inventory to achieve a broader portfolio of products. 24 (1) Table of ContentsFiscal 2017 Comparison to Fiscal 2016The table below provides the comparison of reported and organic fiscal 2017 sales to fiscal 2016 sales to allow readersto better assess and understand the Company’s sales performance. Organic Sales Organic Sales Sales from Organic Organic Year-Year % Sales as Reported Acquisitions/ Sales Sales Change in Fiscal Fiscal Estimated Fiscal Year-Year Constant 2017 2016 Extra Week 2016 % Change Currency (Dollars in millions) Avnet $17,818.3 $16,740.6 $1,061.4 $17,802.0 0.1% 1.0%Avnet by region Americas $5,318.3 $4,801.3 $477.9 $5,279.2 0.7% 0.7%EMEA 6,091.8 5,103.0 560.9 5,663.9 7.6 10.7 Asia 6,408.2 6,836.3 22.6 6,858.9 (6.6) (6.9) Avnet by segment EC $16,474.1 $16,740.6 $(300.0) $16,440.6 0.2% 0.8%PF 1,344.2 — 1,361.4 1,361.4 (1.3) 2.7 (1)Includes Premier Farnell acquired on October 17, 2016, which has operations in each Avnet regionSales for fiscal 2017 were $17.44 billion, an increase of 4.2%, or $699.4 million, from fiscal 2016 sales of $16.74billion. Organic sales were flat year over year and increased 1.0% in constant currency. The organic sales increase in constantcurrency was primarily due to organic growth in the EC EMEA region and organic growth in the PF business, offset bydeclines in the EC Asia region.Gross Profit and Gross Profit MarginsGross profit in fiscal 2018 was $2.53 billion, an increase of $157.7 million, or 6.7%, compared to fiscal 2017. Thisincrease was due to the acquisition of PF and the impact of changes in foreign currency exchange rates, partially offset bydeclines from supplier channel and program changes. Gross profit margin of 13.3% in fiscal 2018 decreased 31 basis pointsfrom the prior year primarily due to supplier channel and program changes and due to a higher mix of sales coming from thelower gross profit margin EC Asia region, partially offset by fiscal 2018 including a full fiscal year of PF sales.Gross profit in fiscal 2017 was $2.37 billion, an increase of $291.5 million, or 14.0%, from fiscal 2016 primarily due tothe acquisition of PF. Gross profit margin of 13.6% increased 117 basis points year over year primarily due to the acquisitionof PF and from the impact of deselecting lower margin high volume supply chain engagements in EC Asia, partially offset bydeclines in the EC western regions primarily due to the Americas region.Selling, General and Administrative ExpensesSelling, general and administrative expenses (“SG&A expenses”) in fiscal 2018 were $1.97 billion, an increase of$199.5 million, or 11.3%, compared to fiscal 2017. The year-over-year increase in SG&A expenses was primarily due to theacquisition of PF in October of fiscal 2017 and the impact of changes in foreign currency exchange rates, partially offset byrestructuring and integration actions taken in fiscal 2018. Metrics that management monitors with respect to its operating expenses are SG&A expenses as a percentage of salesand as a percentage of gross profit. In fiscal 2018, SG&A expenses as a percentage of sales were 10.3% and as a25 (1) Table of Contentspercentage of gross profit were 78.0%, as compared with 10.2% and 74.7%, respectively, in fiscal 2017. The increase inSG&A expenses as a percentage of gross profit is due primarily to the decline in gross profit margin year over year.SG&A expenses were $1.77 billion in fiscal 2017, an increase of $310.4 million, or 21.3%, from fiscal 2016. The year-over-year increase in SG&A expenses was primarily due to the acquisition of PF including the impact of additionalamortization of intangible asset expense, partially offset by the impact of prior restructuring actions and favorable changes inforeign currency exchange rates between years. In fiscal 2017, SG&A expenses as a percentage of sales were 10.2% and as apercentage of gross profit were 74.7%, as compared with 8.7% and 70.3%, respectively, in fiscal 2016. SG&A expenses as apercentage of gross profit increased over 400 basis points year over year due primarily to the impact of the PF acquisition.Goodwill Impairment ExpensesThe Company impaired goodwill in the Americas region of the EC operating group and recorded $181.4 million ofgoodwill impairment expense in the third quarter of fiscal 2018.See Note 7, “Goodwill and intangible assets” to the Company’s consolidated financial statements included in Item 15of this Annual Report on Form 10-K for additional information related to goodwill impairment expenses.Restructuring, Integration and Other ExpensesDuring fiscal 2018, the Company continued to take certain actions in an effort to reduce future operating expenses inresponse to current market and Company specific conditions. These actions included restructuring and integration actionsrelated to the acquisition of PF and the integration of certain regional and global businesses after the TS business divestiture.Additionally, the Company incurred accelerated depreciation related to the incremental depreciation expense incurredrelated to the shortening of the estimated useful life of the Company’s ERP system in the Americas compared to depreciationexpense based on the original useful life of such ERP system, and other costs related to incremental amounts incurred by theCompany as a result of the Act and other restructuring and integration related activities.The Company recorded $60.6 million for restructuring costs in fiscal 2018, and expects to realize approximately $84.3million in incremental annualized operating costs savings as a result of such restructuring actions. Restructuring expensesconsisted of $56.8 million for severance, $1.0 million for facility exit costs, $2.6 million for asset impairments, and $0.2million for other restructuring expenses. Integration, accelerated depreciation and other costs were $20.9 million, $52.9million and $12.0 million, respectively. The Company also recorded a net benefit of $1.3 million for changes in estimates forrestructuring liabilities established in prior fiscal years. The after tax impact of restructuring, integration and other expenseswere $103.7 million and $0.86 per share on a diluted basis.During fiscal 2017, the Company took certain actions in an effort to reduce future operating expenses in response tocurrent market and Company specific conditions, including restructuring actions related to the acquisition of PF. In addition,the Company incurred integration, acquisition/divestiture, accelerated depreciation and other costs. Integration costs areprimarily related to costs incurred to integrate acquired businesses, the integration of certain regional and global businessesincluding Avnet after the TS divestiture, and incremental costs incurred as part of the consolidation, relocation, and closureof warehouse and office facilities. Acquisition/divestiture costs consist primarily of professional fees and other costs incurredrelated to the acquisition, divestiture and closure of businesses including the acquisition of PF and the divestiture of TS.Other costs consist primarily of any ongoing facilities’ operating costs associated with the consolidation, relocation andclosure of facilities once such facilities have been vacated or substantially vacated, and other miscellaneous costs that relateto restructuring, integration and other expenses.26 Table of ContentsDuring fiscal 2017, the Company recorded restructuring, integration and other expenses of $137.4 million. TheCompany recorded $41.7 million for restructuring costs, and expects to realize approximately $45.0 million in incrementalannualized operating costs savings as a result of such restructuring actions. Restructuring expenses consisted of $36.1million for severance, $0.6 million for facility exit costs, $3.5 million for asset impairments, and $1.5 million for otherrestructuring expenses. Integration, accelerated depreciation and other costs including acquisition/divestiture costs were$37.9 million, $16.0 million and $44.9 million, respectively. The Company also recorded a net benefit of $3.1 million forchanges in estimates for restructuring liabilities established in prior fiscal years. The after tax impact of restructuring,integration and other expenses were $92.0 million and $0.73 per share on a diluted basis.During fiscal 2016, the Company incurred restructuring expenses related to certain actions intended to reduce futureoperating expenses. In addition, the Company incurred integration and other costs primarily associated with the integrationof acquired businesses, the integration of certain global and regional businesses, the integration of significant informationtechnology systems and other costs associated with the acquisition of and the closure or divestiture of certain businesses. Asa result, during fiscal 2016 the Company recorded restructuring, integration and other expenses of $44.8 million. TheCompany recorded $31.5 million for restructuring costs, and expects to realize approximately $24.0 million in incrementalannualized operating cost savings as a result of such restructuring actions. Restructuring expenses consisted of $29.4 millionfor severance, $1.6 million for facility exit costs, $0.1 million for asset impairments, and $0.4 million for other restructuringexpenses. Integration and other costs including acquisition costs were $6.8 million and $7.9 million, respectively. TheCompany also recorded a net benefit of $1.4 million for changes in estimates for restructuring liabilities established in priorfiscal years. The after tax impact of restructuring, integration and other expenses were $29.3 million and $0.22 per share on adiluted basis.See Note 18, “Restructuring expenses” to the Company’s consolidated financial statements included in Item 15 of thisAnnual Report on Form 10-K for additional information related to restructuring expenses. Operating IncomeDuring fiscal 2018, the Company had operating income of $230.5 million, representing a 50.0% decrease as comparedwith fiscal 2017 operating income of $461.4 million. The year over year decrease in operating income was primarily drivenby goodwill impairment expense, partially offset by improvements at PF. Operating income margin was 1.2% in fiscal 2018compared to 2.6% in fiscal 2017. Both years included restructuring, integration and other expenses and the amortization ofacquired intangible assets. Fiscal 2018 also includes goodwill impairment expense. Excluding these amounts, adjustedoperating income was $649.0 million, or 3.4% of sales, in fiscal 2018 as compared with $653.3 million, or 3.7% of sales, infiscal 2017.During fiscal 2017, the Company had operating income of $461.4 million, representing a 19.5% decrease as comparedwith fiscal 2016 operating income of $572.9 million. Operating income margin was 2.6% in fiscal 2017 compared to 3.4% infiscal 2016. Both years included restructuring, integration and other expenses and the amortization of acquired intangibleassets. Excluding these amounts from both years, adjusted operating income was $653.3 million, or 3.7% of sales, in fiscal2017 as compared with $627.5 million, or 3.7% of sales, in fiscal 2016. Although operating income margin was flat year overyear, there was an increase as a result of the acquisition of PF, substantially offset by a reduction at EC primarily in theAmericas region. Interest ExpenseInterest expense for fiscal 2018 was $102.5 million, a decrease of $4.2 million, or 3.9%, compared with interest expenseof $106.7 million in fiscal 2017. The decrease in interest expense in fiscal 2018 compared to fiscal 2017 was27 Table of Contentsprimarily related to the impact of the Company’s repayment of its outstanding term loans and borrowings on its revolvingcredit facilities in the second half of fiscal 2017, which were used to help fund the PF acquisition.Interest expense for fiscal 2017 was $106.7 million, an increase of $14.8 million, or 16.0%, compared with fiscal 2016.The increase in interest expense was primarily related to new debt outstanding during portions of fiscal 2017 including debtincurred to finance the acquisition of PF.Other Income (Expense), netDuring fiscal 2018, the Company had $17.1 million of other income as compared with $44.3 million of other expensein fiscal 2017. In fiscal 2018, the Company had foreign currency gains primarily related to the strengthening of both the Euroand British Pound compared to the U.S. Dollar. In fiscal 2017, other expenses related to foreign currency hedging and othercosts associated with the Company’s acquisition of PF.During fiscal 2017, the Company incurred $44.3 million of other expense as compared with $3.0 million in fiscal 2016.As described above, the increase in other expense in fiscal 2017 is primarily attributable to the foreign currency hedging andother costs associated with the PF acquisition.Income Tax ExpenseAvnet’s effective tax rate on its income from continuing operations before income taxes was 198.5% in fiscal 2018 ascompared with an effective tax rate of 15.2% in fiscal 2017. The fiscal 2018 effective tax rate is higher than the fiscal 2017effective tax rate due primarily to (i) the provisional transition tax expense recorded under the requirements of the Act and(ii) the goodwill impairment, which was not tax deductible, partially offset primarily by the mix of income in lower taxjurisdictions.Avnet’s effective tax rate on income before income taxes from continuing operations was 15.2% in fiscal 2017 ascompared with an effective tax rate of 18.2% in fiscal 2016. The fiscal 2017 effective tax rate is lower than the fiscal 2016effective tax rate due primarily to a favorable mix of income in lower tax jurisdictions, partially offset by tax expense fromthe establishment of valuation allowances and contingency reserves in fiscal 2017 as compared with a tax benefit fromvaluation allowances released in fiscal 2016.Avnet’s effective tax rate is primarily a function of the tax rates in the numerous jurisdictions in which it does businessapplied to the mix of income before taxes. The effective tax rate may vary year over year as a result of changes in taxrequirements in these jurisdictions, management’s evaluation of its ability to recognize its net deferred tax assets and theestablishment of liabilities for unfavorable outcomes of tax positions taken on certain matters that are common tomultinational enterprises and the actual outcome of those matters.See Note 10, “Income taxes” to the Company’s consolidated financial statements included in Item 15 of this AnnualReport on Form 10-K for additional information related to income taxes.Income (Loss) from Discontinued OperationsLoss from discontinued operations was $13.5 million in fiscal 2018 compared to $261.9 million of income fromdiscontinued operations in fiscal 2017. The loss was primarily as a result of settlement losses associated with the Company’spension plan due to former TS business employees requesting and receiving distributions from the Company’s pension planduring fiscal 2018. The income from discontinued operations in fiscal 2017 was primarily the result of the28 Table of Contentsrecognition of the gain on sale and to a lesser extent the operating profits of the TS business in fiscal 2017 prior to theclosing of the sale at the end of February 2017.Income from discontinued operations increased $146.3 million to $261.9 million in fiscal 2017 compared to $115.6million in fiscal 2016. Excluding the gain on sale of $222.4 million net of tax, income from discontinued operationsdecreased $76.1 million in fiscal 2017, which only contained 34 weeks as a result of the sale of TS being completed at theend of February 2017.See Note 3, “Discontinued operations” to the Company’s consolidated financial statements included in Item 15 of thisAnnual Report on Form 10-K for additional information and detail on the financial results of discontinued operations.Net Income (Loss)As a result of the factors described in the preceding sections of this MD&A, the Company’s net loss in fiscal 2018 was$156.4 million, or $1.30 per share on a diluted basis, compared with net income of $525.3 million, or $4.08 per share on adiluted basis, in fiscal 2017 and $506.5 million, or $3.80 per share on a diluted basis, in fiscal 2016. Liquidity and Capital ResourcesCash FlowsCash Flows from Operating ActivitiesThe Company generated $253.5 million of cash from its operating activities in fiscal 2018 as compared to $221.0million in fiscal 2017. These operating cash flows from continuing operations are comprised of: (i) cash flows generated fromnet income from continuing operations, adjusted for the impact of non-cash and other items, which includes depreciation andamortization expense, goodwill impairment expense, deferred income taxes, stock-based compensation expense and othernon-cash items (including provisions for doubtful accounts and net periodic pension costs), and (ii) cash flows used for, orgenerated from, working capital and other, excluding cash and cash equivalents. Cash used for working capital and other was$6.2 million during fiscal 2018, including increases in accounts receivable of $296.2 million and inventories of $308.7million. The Company utilized cash to invest in inventory levels primarily as a result of a strong book to bill andlengthening product lead times. The increase in cash used for inventories and accounts receivable was partially offset byincreases in accounts payable of $409.6 million and accrued expenses and other of $189.1 million. During fiscal 2017, the Company generated $221.0 million of cash from its operating activities for continuingoperations in fiscal 2017 as compared to a cash usage of $48.9 million in fiscal 2016. Cash used for working capital andother was $256.7 million during fiscal 2017, including an increase in accounts receivable of $371.8 million primarily due tothe increase in fourth quarter sales year over year and a decrease in accrued expenses and other of $132.9 million, partiallyoffset by a decrease in inventories of $84.4 million and an increase in accounts payable of $163.6 million primarily due toimproved working capital management year over year in the EC Asia region.Cash used for operating activities of discontinued operations was $589.7 million in fiscal 2017 compared to a cashgeneration of $273.2 million in fiscal 2016. The decrease was primarily the result of the sale of the TS business beingcompleted in February 2017, prior to such business completing the cash conversion cycle from its second fiscal quartercompared to fiscal 2016, which reflected a full fiscal year of operations and cash flows for the TS business. Included in thecash used for discontinued operations in fiscal 2017 was the income tax payment associated with the gain on sale.29 Table of ContentsCash Flows from Financing ActivitiesDuring fiscal 2018, the Company made net repayments of $37.0 million under the Company’s accounts receivablesecuritization program and $98.0 million from borrowings of various bank credit facilities. During fiscal 2018, the Companyreceived net proceeds of $8.9 million under the Company’s Credit Facility. In addition, during fiscal 2018, the Companypaid quarterly dividends on common stock of $88.3 million and repurchased $323.5 million of common stock under theCompany’s share repurchase program.During fiscal 2017, the Company received net proceeds of $296.4 million as a result of the issuance of $300.0 millionof 3.75% Notes due December 2021. Additionally, the Company received net proceeds of $530.8 million under a term loanand $27.9 million from borrowings of bank credit facilities and other debt. During fiscal 2017, the Company repaid $530.8million of notes and acquired debt, $511.4 million from borrowings under a term loan, $50.0 million under the Company’ssenior unsecured credit facility and made net repayments of $588.0 million under the Company’s accounts receivablesecuritization program. In addition, during fiscal 2017, the Company used $88.7 million and $275.9 million of cash to payquarterly cash dividends on common stock and to repurchase common stock under the Company’s share repurchase program,respectively. During fiscal 2016, the Company received net proceeds of $541.5 million as a result of the issuance of $550.0 millionof 4.625% Notes due April 2026, $18.7 million from borrowings of bank credit facilities and other debt, $101.2 millionunder the Company’s senior unsecured credit facility and $80.0 million under the Company’s accounts receivablesecuritization program. During fiscal 2016, the Company repaid upon maturity the $250.0 million of 6.00% Notes dueSeptember 2015. In addition, during fiscal 2016, the Company used $88.6 million and $380.9 million of cash to payquarterly cash dividends on common stock and to repurchase common stock under the Company’s share repurchase program,respectively. Cash Flows from Investing ActivitiesDuring fiscal 2018, the Company used $155.9 million for capital expenditures primarily related to information systemdevelopment costs, computer hardware and software purchases and facilities costs. Additionally, the Company used $15.3million of cash for acquisitions, which is net of the cash acquired. During fiscal 2018, the Company realized $236.2 millionof cash from investing activities of discontinued operations, substantially all of which related to the sale of the marketablesecurities obtained as a component of the proceeds from the sale of the TS business.During fiscal 2017, the Company used $802.7 million of cash for acquisitions, which is net of cash acquired, and used$120.4 million for capital expenditures primarily related to information system development costs, computer hardware andsoftware purchases and facilities costs. During fiscal 2017, with the sale of the TS business, the Company received $2.24billion of cash proceeds from the sale of TS, net of cash divested, which is reflected as an investing activity fromdiscontinued operations.During fiscal 2016, the Company used $137.4 million for capital expenditures primarily related to information systemdevelopment costs, computer hardware and software purchases and facilities costs. Additionally, the Company used $30.7million for investing activities related to discontinued operations primarily related to acquisitions and capital expendituresfor the TS business. Financing TransactionsThe Company uses a variety of financing arrangements, both short-term and long-term, to fund its operations inaddition to cash generated from operating activities. The Company also uses several sources of funding so that it does not30 Table of Contentsbecome overly dependent on one source and to achieve a lower cost of funding through these different alternatives. Thesefinancing arrangements include public debt, short-term and long-term bank loans, a revolving credit facility (the “CreditFacility”) and an accounts receivable securitization program (the “Program”).The Company has various lines of credit and other forms of bank debt in the U.S. and various foreign locations to fundthe short-term working capital, foreign exchange, overdraft and letter of credit needs of its wholly owned subsidiaries. Avnetgenerally guarantees its subsidiaries’ obligations under such debt facilities. Outstanding borrowings under such forms of debtat the end of fiscal 2018 was $0.8 million.See Note 8, “Debt” to the Company’s consolidated financial statements included in Item 15 of this Annual Report onForm 10-K for additional information on financing transactions including the Credit Facility, the Program and theoutstanding Notes as of June 30, 2018.Covenants and ConditionsThe Program requires the Company to maintain certain minimum interest coverage and leverage ratios in order tocontinue utilizing the Program. The Program also contains certain covenants relating to the quality of the receivables sold. Ifthese conditions are not met, the Company may not be able to borrow any additional funds and the financial institutions mayconsider this an amortization event, as defined in the Program agreements, which would permit the financial institutions toliquidate the accounts receivables sold to cover any outstanding borrowings. Circumstances that could affect the Company’sability to meet the required covenants and conditions of the Program include the Company’s ongoing profitability andvarious other economic, market and industry factors. Management does not believe that the covenants under the Programlimit the Company’s ability to pursue its intended business strategy or its future financing needs. The Company was incompliance with all covenants of the Program as of June 30, 2018.The Credit Facility contains certain covenants with various limitations on debt incurrence, share repurchases,dividends, investments and capital expenditures and also includes financial covenants requiring the Company to maintainminimum interest coverage and leverage ratios. Management does not believe that the covenants in the Credit Facility limitthe Company’s ability to pursue its intended business strategy or its future financing needs. The Company was in compliancewith all covenants of the Credit Facility as of June 30, 2018.See Liquidity below for further discussion of the Company’s availability under these various facilities.LiquidityThe Company had cash and cash equivalents of $621.1 million as of June 30, 2018, of which $545.3 million was heldoutside the United States. As of July 1, 2017, the Company had cash and cash equivalents of $836.4 million, of which $619.5million was held outside of the United States.As of June 30, 2018, there were no borrowings outstanding and $2.0 million in letters of credit issued under the CreditFacility and $105.0 million outstanding under the Program. During fiscal 2018, the Company had an average daily balanceoutstanding under the Credit Facility of approximately $10.9 million and $206.0 million under the Program. During fiscal2017, the Company had an average daily balance outstanding under the Credit Facility of approximately $475.4 million and$504.0 million under the Program. In August 2018, subsequent to the end of fiscal 2018, the Company amended andextended the Program for an additional two years. As of June 30, 2018, the combined availability under the Credit Facilityand the Program was $1.50 billion.31 Table of ContentsDuring periods of weakening demand in the electronic components industry, the Company typically generates cashfrom operating activities. Conversely, the Company is more likely to use operating cash flows for working capitalrequirements during periods of higher growth. During fiscal 2018, the Company generated $253.5 million from operatingactivities from continuing operations.Liquidity is subject to many factors, such as normal business operations as well as general economic, financial,competitive, legislative, and regulatory factors that are beyond the Company’s control. As a result of tax law changes createdfrom the Act, which created a regulatory environment more favorable to repatriation, the Company repatriated approximately$248.3 million of foreign cash to the United States in fiscal 2018, which was used to repay outstanding revolving debtfacilities. To the extent the cash balances held in foreign locations cannot be remitted back to the U.S. in a tax efficientmanner, those cash balances are generally used for ongoing working capital, capital expenditure needs and to supportacquisitions, and are currently expected to be permanently reinvested outside the United States. The Company is stillevaluating the impact of repatriating any additional foreign cash as a result of the Act. In addition, local governmentregulations may restrict the Company’s ability to move funds among various locations under certain circumstances.Management does not believe such restrictions would limit the Company’s ability to pursue its intended business strategy.Management believes that Avnet’s available borrowing capacity, its current cash on hand, the remaining proceeds receivedfrom the sale of the TS business in the first quarter of fiscal 2019 and the Company’s expected ability to generate operatingcash flows in the future will be sufficient to meet its future liquidity needs. The Company also may issue debt or equitysecurities in the future and management believes the Company will have adequate access to the capital markets, if needed.Historically the Company has made, and expects to continue to make, strategic investments through acquisitionactivity to the extent the investments strengthen Avnet’s competitive position, further its business strategies and meetmanagement’s return on capital thresholds. The Company also expects to make capital expenditures, including expendituresfor ERP systems. Additionally, as the Company integrates PF and pursues ways to become more efficient and cost effective,the Company expects to use cash for restructuring, integration and other expenses.In addition to continuing to make investments in acquisitions, as of June 30, 2018, the Company may repurchase up toan aggregate of $272.1 million of the Company’s common stock through a $1.95 billion share repurchase program approvedby the Board of Directors. The Company plans to repurchase stock from time to time at the discretion of management, subjectto available free cash flow, strategic considerations, market conditions and other factors. The Company may terminate orlimit the share repurchase program at any time without prior notice. The timing and actual number of shares repurchased willdepend on a variety of factors such as share price, corporate and regulatory requirements, and prevailing market conditions.Additionally, the Company currently expects to pay quarterly cash dividends on shares of its common stock, subject toapproval of the Board of Directors. During fiscal 2018, the Company paid cash dividends of $88.3 million on its commonstock or approximately $0.19 per share on a quarterly basis. The Company also expects to make capital expenditures primarily related to distribution centers and facilities andinvestments in IT systems, technologies and tools.See Item 6, Selected Financial Data in Part II of this Annual Report on Form 10-K for additional information on theCompany’s liquidity and related ratios.32 Table of ContentsLong-Term Contractual ObligationsThe Company has the following contractual obligations outstanding as of June 30, 2018 (in millions): Payments due by period Lessthan Morethan Contractual Obligations Total 1 year 1-3 years 3-5 years 5 years Long-term debt obligations $1,665.8 $165.4 $300.4 $650.0 $550.0 Interest expense on long-term debt obligations 351.2 75.9 124.6 79.7 71.0 Operating lease obligations 317.1 73.7 98.4 62.9 82.1 (1)Excludes unamortized discount and issuance costs on debt.(2)Represents interest expense due on debt by using fixed interest rates for fixed rate debt and assuming the same interestrate at the end of fiscal 2018 for variable rate debt.At June 30, 2018, the Company had an estimated liability for income tax contingencies of $106.6 million, which is notincluded in the above table. Cash payments associated with the settlement of these liabilities that are expected to be paidwithin the next 12 months is $9.9 million. The settlement period for the remaining amount of the unrecognized tax benefits,including related accrued interest and penalties, cannot be determined and therefore was not included in the table.The Company does not currently have any material long-term commitments for purchases of inventories from suppliersor for capital expenditures.Critical Accounting PoliciesThe Company’s consolidated financial statements have been prepared in accordance with GAAP. The preparation ofthese consolidated financial statements requires the Company to make estimates and assumptions that affect the reportedamounts of assets, liabilities, sales and expenses. These estimates and assumptions are based upon the Company’s continuousevaluation of available information including historical results and anticipated future events. Actual results may differmaterially from these estimates.The Securities and Exchange Commission defines critical accounting policies as those that are, in management’s view,most important to the portrayal of the Company’s financial condition and results of operations and that require significantjudgments and estimates. Management believes the Company’s most critical accounting policies at the end of fiscal 2018relate to:Valuation of InventoriesInventories are recorded at the lower of cost or estimated net realizable value. The Company’s inventories includeelectronic components sold into changing, cyclical and competitive markets wherein such inventories may be subject todeclines in market value or obsolescence.The Company regularly evaluates inventories for expected customer demand, obsolescence, current market prices andother factors that may render inventories less marketable. Write-downs are recorded so that inventories reflect theapproximate net realizable value and take into account the Company’s contractual provisions with its suppliers, which mayprovide certain protections to the Company for product obsolescence and price erosion in the form of rights of return, stockrotation rights, obsolescence allowances and price protections. Because of the large number of products and suppliers and thecomplexity of managing the process around price protections and stock rotations, estimates are made regarding33 (1)(2) Table of Contentsthe realizable value of inventories. Additionally, assumptions about future demand, market conditions and decisions todiscontinue certain product lines impact the evaluation of whether to write-down inventories. If assumptions about futuredemand change or actual market conditions are less favorable than those assumed by management, management wouldevaluate whether additional write-downs of inventories are required. In any case, actual net realizable values could bedifferent from those currently estimated.Accounting for Income TaxesManagement’s judgment is required in determining income tax expense, unrecognized tax benefits and in measuringdeferred tax assets and liabilities and the valuation allowances recorded against net deferred tax assets. The recoverability ofthe Company’s net deferred tax assets is dependent upon its ability to generate sufficient future taxable income in certainjurisdictions. In addition, the Company considers historic levels and types of income, expectations and risk associated withestimates of future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need forvaluation allowances. Should the Company determine that it is not able to realize all or part of its deferred tax assets in thefuture, additional valuation allowances may be recorded against the deferred tax assets with a corresponding increase toincome tax expense in the period such determination is made. Similarly, should the Company determine that it is able torealize all or part of its deferred tax assets that have an associated valuation allowance established, the Company may releasea valuation allowance with a corresponding benefit to income tax expense in the period such determination is made.The Company establishes contingent liabilities for potentially unfavorable outcomes of positions taken on certain taxmatters. These liabilities are based on management’s assessment of whether a tax benefit is more likely than not to besustained upon examination by tax authorities. There may be differences between the anticipated and actual outcomes ofthese matters that may result in changes in estimates to such liabilities. To the extent such changes in estimates are necessary,the Company’s effective tax rate may potentially fluctuate as a result. In accordance with the Company’s accounting policy,accrued interest and penalties related to unrecognized tax benefits are recorded as a component of income tax expense.In determining the Company’s income tax expense, management considers current tax regulations in the numerousjurisdictions in which it operates including the impact in the United States of the Act. The Company exercises judgment forinterpretation and application of such current tax regulations. Changes to such tax regulations or disagreements with theCompany’s interpretation or application by tax authorities in any of the Company’s major jurisdictions may have asignificant impact on the Company’s income tax expense.See Note 1 and Note 10 to the Company’s consolidated financial statements included in Item 15 of this Annual Reporton Form 10-K for further discussion on income tax expense, valuation allowances and unrecognized tax benefits.Goodwill and Long-lived Asset ImpairmentThe Company has a significant amount of goodwill and long-lived assets, which are subject to the risk of impairment.In assessing goodwill for impairment, the Company is required to make significant judgments related to the fair valueof its reporting units including assumptions about the future operating performance of such reporting units. The Company isalso required to make judgments regarding the evaluation of changes in events or circumstances that would more likely thannot reduce the fair value of any of its reporting units below their carrying value, the results of which would determinewhether an interim goodwill impairment test must be performed. Should these assumptions or judgments change in the futurebased upon market conditions or should the structure of the Company’s reporting units change based upon changes inbusiness strategy or structure, the Company may be required to perform an interim impairment test which may result ingoodwill impairment expense.34 Table of ContentsIn order to estimate the fair value of its reporting units, the Company uses a combination of an income approach,specifically a discounted cash flow methodology, and a market approach. The discounted cash flow methodology includesmarket participant assumptions for, among other factors, forecasted sales, gross profit margins, operating expenses, cashflows, perpetual growth rates and long-term discount rates, all of which require judgments and estimates by managementwhich are inherently uncertain. The market approach methodology requires significant assumptions related to comparabletransactions, market multiples, capital structure and control premiums. These assumptions, judgments and estimates maychange in the future based upon market conditions or other events and could result in goodwill impairment expense.Long-lived assets, including property, plant and equipment and intangible assets, are reviewed for impairmentwhenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable,which requires the Company to use judgment. For purposes of recognition and measurement of an impairment loss, long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largelyindependent of the cash flows of other assets and liabilities (“asset group”). An impairment is recognized when the estimatedundiscounted future cash flows expected by management from the use of an asset group including its eventual disposition isless than its carrying amount. An impairment is measured as the amount by which an asset group’s net book value exceeds itsestimated fair value. The determination of fair value requires the Company to make certain judgments and assumptions. TheCompany considers a long-lived asset to be abandoned when it has ceased use of such abandoned asset and if the Companyhas no intent to use or repurpose the asset in the future. The Company continually evaluates the carrying value and theremaining economic useful life of all long-lived assets and will adjust the carrying value and remaining useful life if andwhen appropriate.See Note 1 and Note 7 to the Company’s consolidated financial statements included in Item 15 of this Annual Reporton Form 10-K for further discussion on the goodwill and long-lived asset impairment test evaluations. Recently Issued Accounting PronouncementsIn May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2014-09,Revenue from Contracts with Customers, as amended (“ASU 2014-09”), to supersede nearly all existing revenue recognitionguidance under GAAP. The core principles of ASU 2014-09 are to recognize revenue when promised goods or services aretransferred to customers in an amount that reflects the consideration that is expected to be received for those goods orservices. Application of the guidance in ASU 2014-09 requires more judgment and estimates within the revenue recognitionprocess compared to existing GAAP. ASU 2014-09 is required to be adopted by the Company in the first quarter of fiscal2019.The Company expects to adopt the requirements of ASU 2014-09 using modified retrospective adoption to each priorreporting period presented. The company has established an implementation team inclusive of external advisors engaged toassist in evaluating potential differences compared to existing GAAP. The Company has identified its revenue streams and iscurrently assessing each stream for potential impacts from the adoption of ASU 2014-09. For the revenue streams assessed todate, the Company does not anticipate a material impact to the timing or amount of revenue recognized compared to existingGAAP.The Company’s analysis and evaluation of the new standard will continue into the first quarter of fiscal 2019 and asubstantial amount of work remains to be completed due to the complexity of the new standard, the application of judgmentand the requirement for the use of estimates in applying the new standard, as well as the significant number of revenuestreams that must be reviewed under the new standard. The Company does not currently expect significant changes inrevenue recognition practices for continuing operations compared to existing GAAP, which is consistent with the disclosedimpact by other companies within the Company’s industry.35 Table of ContentsIn February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (“ASU 2016-02”) and issuedsubsequent amendments to the initial guidance in September 2017 within ASU 2017-13 (collectively, Topic 842). Topic 842requires companies to generally recognize operating and financing lease liabilities on the balance sheet and correspondingright-of-use assets created by those leases with lease terms of more than 12 months. The Company intends to adopt Topic 842when it becomes effective in the first quarter of fiscal 2020 using a modified retrospective approach. The Company iscurrently evaluating the impact of its pending adoption of Topic 842 on its consolidated financial statements and expectsthat most of its operating lease commitments related to the Company’s real estate portfolio will be subject to the newstandard and recognized as operating lease liabilities and right-of-use assets upon adoption, which will materially increasetotal assets and total liabilities relative to such amounts prior to adoption. In October 2016, the FASB issued Accounting Standards Update No. 2016-16, Income Taxes (Topic 740): Intra-EntityTransfers of Assets Other Than Inventory (“ASU 2016-16”). The update addresses the recognition of current and deferredincome taxes resulting from an intra-entity transfer of any asset other than inventory and requires companies to recognize theincome tax consequences in the period in which they occur. ASU 2016-16 is effective for fiscal years, and interim periodswithin those fiscal years, beginning after December 15, 2017 and is applied on a modified retrospective basis through acumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The Company plansto adopt this update in its first quarter of fiscal 2019. The Company is finalizing its evaluation of the impact of the adoptionon its consolidated financial statements and expects to recognize its previously deferred tax related intra-equity transfers toretained earnings and an overall decrease in total assets, primarily other assets. While the Company is continuing to assessthe potential effects of adoption of this update, future intra-entity transfers of assets between its legal entities occurring afterthe adoption of the updated standard could have a material impact on the Company’s income tax expense in the period thatthe transfer occurs.In March 2017, the FASB issued Accounting Standards Update 2017-07, Compensation–Retirement Benefits (Topic715) - Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (“ASU 2017-07”). The new guidance requires the service cost component of net periodic benefit cost to be presented in the same incomestatement line item as other employee compensation costs arising from services rendered during the period, and allows onlythe service cost component to be eligible for capitalization in assets. Other components of the net periodic benefit cost are tobe presented separately from the line item that includes the service cost and outside of any subtotal of operating income, andthe line item must be appropriately described. If a separate line item is not used, the line item used in the income statement topresent the other components of net benefit cost must be disclosed. The Company will adopt ASU 2017-07 when it becomeseffective in its first quarter of fiscal 2019. The amendment is to be applied retrospectively. The new guidance primarilyimpacts the income statement presentation of net periodic benefit cost and the Company does not believe adoption of thisstandard will have a material impact on its consolidated financial statements including income before income taxes, but thereported amount of operating income will decrease compared to historical measurements of operating income. See Note 11 tothe Company’s consolidated financial statements included in Item 15 of this Annual Report on Form 10-K for furtherinformation on the components of net periodic benefit cost.In August 2017, the FASB issued Accounting Standards Update 2017-12, Derivatives and Hedging (Topic 815) -Targeted Improvements to Accounting for Hedging Activities (“ASU 2017-12”), which improves the financial reporting ofhedging relationships to better portray the economic results of an entity’s risk management activities in its financialstatements and makes certain targeted improvements to simplify the qualification and application of the hedge accountingcompared to current GAAP. This update is effective for fiscal years beginning after December 15, 2018, with early adoptionpermitted. The Company is currently evaluating the impact of the adoption of ASU 2017-12 on its consolidated financialstatements.36 Table of ContentsIn February 2018, the FASB issued Accounting Standards Update 2018-02, Income Statement–ReportingComprehensive Income (Topic 220):-Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income(“ASU 2018-02”), which allows entities to reclassify accumulated other comprehensive income to retained earnings forstranded tax effects resulting from the Act. This update is effective for interim and annual reporting periods beginning afterDecember 15, 2018, with early adoption permitted. The update should be applied either in the period of adoption orretrospectively to each period (or periods) in which the effect of the income tax rate change resulting from the Act isrecognized. The Company is currently evaluating the impact of the adoption of ASU 2018-02 on its consolidated financialstatements. Item 7A. Quantitative and Qualitative Disclosures About Market RiskThe Company seeks to reduce earnings and cash flow volatility associated with changes in interest rates and foreigncurrency exchange rates by entering into financial arrangements, from time to time, which are intended to provide aneconomic hedge against all or a portion of the risks associated with such volatility. The Company continues to haveexposure to such risks to the extent they are not economically hedged.The following table sets forth the scheduled maturities of the Company’s debt outstanding at June 30, 2018 (dollars inmillions): Fiscal Year 2019 2020 2021 2022 2023 Thereafter Total Liabilities: Fixed rate debt $0.4 $300.3 $0.1 $300.0 $350.0 $550.0 $1,500.8 Floating rate debt $165.0 $ — $ — $ — $ — $ — $165.0 (1)Excludes unamortized discounts and issuance costs.The following table sets forth the carrying value and fair value of the Company’s debt and the average interest rates atJune 30, 2018, and July 1, 2017 (dollars in millions): Carrying Value Fair Value at Carrying Value Fair Value at at June 30, 2018 at June 30, 2018 at July 1, 2017 July 1, 2017 Liabilities: Fixed rate debt $1,500.8 $1,520.4 $1,501.1 $1,576.5 Average interest rate 4.8% 4.8% Floating rate debt $165.0 $165.0 $291.6 $291.6 Average interest rate 2.7% 2.1% (1)Excludes unamortized discounts and issuance costs. Fair value was estimated primarily based upon quoted market pricesfor the Company’s public long-term notes.Many of the Company’s subsidiaries purchase and sell products in currencies other than their functional currencies.This subjects the Company to the risks associated with fluctuations in foreign currency exchange rates. The Companyreduces this risk by utilizing natural hedging (i.e., offsetting receivables and payables) as well as by creating offsettingpositions through the use of derivative financial instruments, primarily forward foreign currency exchange contractstypically with maturities of less than sixty days (“economic hedges”), but not greater than one year. The Company continuesto have exposure to foreign currency risks to the extent they are not hedged. The Company adjusts any economic hedges tofair value through the consolidated statements of operations primarily within “other (income) expense, net.” Therefore, thechanges in valuation of the underlying items being economically hedged are offset by the changes in fair37 (1)(1) Table of Contentsvalue of the forward foreign currency exchange contracts. A hypothetical 10% change in foreign currency exchange ratesunder the forward foreign currency exchange contracts outstanding at June 30, 2018 would result in an increase or decreaseof approximately $60.0 million to the fair value of the forward foreign currency exchange contracts, which would generallybe offset by an opposite effect on the underlying exposure being economically hedged. See Note 4 to the Company’sconsolidated financial statements included in Item 15 of this Annual Report on Form 10-K for further discussion onderivative financial instruments. Item 8. Financial Statements and Supplementary DataThe financial statements and supplementary data are listed under Item 15 of this Report. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial DisclosureNone. Item 9A. Controls and ProceduresDisclosure Controls and ProceduresThe Company’s management, including its Chief Executive Officer and Chief Financial Officer, have evaluated theeffectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e)under the Securities Exchange Act of 1934 (the “Exchange Act”)) as of the end of the reporting period covered by this reporton Form 10-K. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as ofthe end of the period covered by this report on Form 10-K, the Company’s disclosure controls and procedures are effectivesuch that material information required to be disclosed by the Company in the reports that it files or submits under theExchange Act is recorded, processed, summarized and reported, within the time periods specified by the Securities andExchange Commission’s rules and forms and is accumulated and communicated to management, including the Company’sprincipal executive officer and principal financial officer, as appropriate to allow timely decisions regarding requireddisclosure.Management’s Report on Internal Control Over Financial ReportingThe Company’s management, including its Chief Executive Officer and Chief Financial Officer, is responsible forestablishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15(d)-15(f)under the Exchange Act. The Company’s internal control over financial reporting is designed to provide reasonableassurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes inaccordance with generally accepted accounting principles in the United States of America. Because of inherent limitations,internal control over financial reporting may not prevent or detect misstatements. Also, controls may become inadequatebecause of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Managementconducted an evaluation of the effectiveness of the Company’s internal control over financial reporting as of June 30, 2018.In making this assessment, management used the 2013 framework established in Internal Control — Integrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission and concluded that the Companymaintained effective internal control over financial reporting as of June 30, 2018. The Company’s independent registered public accounting firm, KPMG LLP, has audited the effectiveness of theCompany’s internal controls over financial reporting as of June 30, 2018, as stated in its audit report which is includedherein.38 Table of ContentsChanges in Internal Control Over Financial ReportingDuring the fourth quarter of fiscal 2018, there were no changes to the Company’s internal control over financialreporting (as defined in Rule 13a-15(f) of the Exchange Act) that have materially affected, or are reasonably likely tomaterially affect, the Company’s internal control over financial reporting. Item 9B. Other InformationNot applicable.39 Table of Contents PART III Item 10. Directors, Executive Officers and Corporate GovernanceThe information called for by Item 10 is incorporated in this Report by reference to the Company’s definitive proxystatement relating to the Annual Meeting of Stockholders anticipated to be held on November 16, 2018. Item 11. Executive CompensationThe information called for by Item 11 is incorporated in this Report by reference to the Company’s definitive proxystatement relating to the Annual Meeting of Stockholders anticipated to be held on November 16, 2018. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder MattersThe information called for by Item 12 is incorporated in this Report by reference to the Company’s definitive proxystatement relating to the Annual Meeting of Stockholders anticipated to be held on November 16, 2018. Item 13. Certain Relationships and Related Transactions, and Director IndependenceThe information called for by Item 13 is incorporated in this Report by reference to the Company’s definitive proxystatement relating to the Annual Meeting of Shareholders anticipated to be held on November 16, 2018. Item 14. Principal Accounting Fees and ServicesThe information called for by Item 14 is incorporated in this Report by reference to the Company’s definitive proxystatement relating to the Annual Meeting of Stockholders anticipated to be held on November 16, 2018.40 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedulesa. The following documents are filed as part of this Report: Page 1. Consolidated Financial Statements: Report of Independent Registered Public Accounting Firm 43 Avnet, Inc. and Subsidiaries Consolidated Financial Statements: Consolidated Balance Sheets at June 30, 2018 and July 1, 2017 44 Consolidated Statements of Operations for the years ended June 30, 2018, July 1, 2017 and July 2, 2016 45 Consolidated Statements of Comprehensive Income for the years ended June 30, 2018, July 1, 2017 andJuly 2, 2016 46 Consolidated Statements of Shareholders’ Equity for the years ended June 30, 2018, July 1, 2017, andJuly 2, 2016 47 Consolidated Statements of Cash Flows for the years ended June 30, 2018, July 1, 2017 and July 2, 2016 48 Notes to Consolidated Financial Statements 49 2. Financial Statement Schedule: Schedule II (Valuation and Qualifying Accounts) for the years ended June 30, 2018, July 1, 2017 andJuly 2, 2016 79 Schedules other than that above have been omitted because they are not applicable or the requiredinformation is shown in the financial statements or notes thereto 3. Exhibits 80 41 Table of Contents SIGNATURESPursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has dulycaused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. AVNET, INC. Date: August 17, 2018By:/s/ WILLIAM J. AMELIO William J. Amelio Chief Executive Officer and Director KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby authorizes andappoints each of William J. Amelio and Thomas Liguori his or her attorneys-in-fact, for him or her in any and all capacities,to sign any amendments to this Report, and to file the same, with exhibits thereto, and other documents in connectiontherewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that said attorneys-in-fact, ortheir substitute, may do or cause to be done by virtue hereof.Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by thefollowing persons on behalf of the Registrant and in the capacities indicated on August 17, 2018. Signature Title /s/ WILLIAM J. AMELIOWilliam J. Amelio Chief Executive Officer and Director(Principal Executive Officer) /s/ WILLIAM H. SCHUMANN, IIIWilliam H. Schumann, III Chairman of the Board and Director /s/ RODNEY C. ADKINSRodney C. Adkins Director /s/ J. VERONICA BIGGINSJ. Veronica Biggins Director /s/ MICHAEL A. BRADLEYMichael A. Bradley Director /s/ R. KERRY CLARKR. Kerry Clark Director /s/ OLEG KHAYKINOleg Khaykin Director /s/ JAMES A. LAWRENCEJames A. Lawrence Director /s/ AVID MODJTABAIAvid Modjtabai Director /s/ THOMAS LIGUORIThomas Liguori Chief Financial Officer(Principal Financial Officer) /s/ KENNETH JACOBSONKenneth Jacobson Controller(Principal Accounting Officer) 42 Table of ContentsReport of Independent Registered Public Accounting FirmThe Board of Directors and ShareholdersAvnet, Inc.:Opinions on the Consolidated Financial Statements and Internal Control Over Financial ReportingWe have audited the accompanying consolidated balance sheets of Avnet, Inc. and subsidiaries (the “Company”) as of June 30, 2018 and July 1, 2017, the relatedconsolidated statements of operations, comprehensive income, shareholders’ equity, and cash flows for each of the years in the three-year period ended June 30,2018, and the related notes and financial statement schedule, (collectively, the “consolidated financial statements”). We also have audited the Company’s internalcontrol over financial reporting as of June 30, 2018, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee ofSponsoring Organizations of the Treadway Commission. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of June 30,2018 and July 1, 2017, and the results of its operations and its cash flows for each of the years in the three-year period ended June 30, 2018, in conformity withU.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financialreporting as of June 30, 2018, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of SponsoringOrganizations of the Treadway Commission.Basis for OpinionThe Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for itsassessment of the effectiveness of internal control over financial reporting, included in the accompanying Management Report on Internal Control Over FinancialReporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control overfinancial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States)(“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules andregulations of the Securities and Exchange Commission and the PCAOB.We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonableassurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal controlover financial reporting was maintained in all material respects.Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financialstatements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidenceregarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significantestimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financialreporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing andevaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as weconsidered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.Definition and Limitations of Internal Control Over Financial ReportingA company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financialreporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactionsand dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorizedacquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation ofeffectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with thepolicies or procedures may deteriorate.. /s/ KPMG LLP We have served as the Company’s auditor since 2002.Phoenix, ArizonaAugust 17, 201843 Table of Contents AVNET, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS June 30, July 1, 2018 2017 (Thousands, except share amounts) ASSETS Current assets: Cash and cash equivalents $621,125 $836,384 Marketable securities — 281,326 Receivables, less allowances of $48,959 and $47,272, respectively 3,641,139 3,337,624 Inventories 3,141,822 2,824,709 Prepaid and other current assets 206,513 253,765 Total current assets 7,610,599 7,533,808 Property, plant and equipment, net 522,909 519,575 Goodwill 980,872 1,148,347 Intangible assets, net 219,913 277,291 Other assets 262,552 220,568 Total assets $9,596,845 $9,699,589 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Short-term debt $165,380 $50,113 Accounts payable 2,269,478 1,861,635 Accrued expenses and other 534,603 542,023 Total current liabilities 2,969,461 2,453,771 Long-term debt 1,489,219 1,729,212 Other liabilities 453,084 334,538 Total liabilities 4,911,764 4,517,521 Commitments and contingencies (Note 14) Shareholders’ equity: Common stock $1.00 par; authorized 300,000,000 shares; issued 115,825,062 sharesand 123,080,952 shares, respectively 115,825 123,081 Additional paid-in capital 1,528,713 1,503,490 Retained earnings 3,235,894 3,799,363 Accumulated other comprehensive (loss) income (195,351) (243,866) Total shareholders’ equity 4,685,081 5,182,068 Total liabilities and shareholders’ equity $9,596,845 $9,699,589 See notes to consolidated financial statements.44 Table of Contents AVNET, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS Years Ended June 30, July 1, July 2, 2018 2017 2016 (Thousands, except per share amounts) Sales $19,036,892 $17,439,963 $16,740,597 Cost of sales 16,509,708 15,070,521 14,662,651 Gross profit 2,527,184 2,369,442 2,077,946 Selling, general and administrative expenses 1,970,103 1,770,627 1,460,273 Goodwill impairment expense (Note 7) 181,440 — — Restructuring, integration and other expenses 145,125 137,415 44,761 Operating income 230,516 461,400 572,912 Other income (expense), net 17,086 (44,305) (2,963) Interest expense (102,525) (106,691) (91,936) Income from continuing operations before taxes 145,077 310,404 478,013 Income tax expense 287,966 47,053 87,104 Income (loss) from continuing operations, net of tax (142,889) 263,351 390,909 Income (loss) from discontinued operations, net of tax (13,535) 261,927 115,622 Net (loss) income $(156,424) $525,278 $506,531 Earnings (loss) per share - basic: Continuing operations $(1.19) $2.07 $2.99 Discontinued operations (0.11) 2.06 0.88 Net (loss) income per share basic $(1.30) $4.13 $3.87 Earnings (loss) per share - diluted: Continuing operations $(1.19) $2.05 $2.93 Discontinued operations (0.11) 2.03 0.87 Net (loss) income per share diluted $(1.30) $4.08 $3.80 Shares used to compute earnings per share: Basic 119,909 127,032 130,858 Diluted 119,909 128,651 133,173 Cash dividends paid per common share $0.74 $0.70 $0.68 See notes to consolidated financial statements. 45 Table of ContentsAVNET, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Years Ended June 30, July 1, July 2, 2018 2017 2016 (Thousands) Net (loss) income $(156,424) $525,278 $506,531 Other comprehensive (loss) income, net of tax: Foreign currency translation and other 7,799 94,116 (45,355) Impact of TS business divestiture (Note 3) — 181,465 — Pension adjustments, net 40,716 1,328 (34,382) Total comprehensive (loss) income $(107,909) $802,187 $426,794 See notes to consolidated financial statements.46 Table of ContentsAVNET, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITYYears Ended June 30, 2018, July 1, 2017 and July 2, 2016 Accumulated Common Common Additional Other Total Stock- Stock- Paid-In Retained Comprehensive Shareholders’ Shares Amount Capital Earnings (Loss) Income Equity (Thousands) Balance, June 27, 2015 135,496 $135,496 $1,407,964 $3,582,599 $(441,038) $4,685,021 Net income — — — 506,531 — 506,531 Translation adjustments — — — — (45,355) (45,355) Pension liability adjustments, net of tax of$21,356 — — — — (34,382) (34,382) Cash dividends — — — (88,594) — (88,594) Repurchases of common stock (9,270) (9,270) — (368,265) — (377,535) Stock-based compensation 1,151 1,151 44,449 — — 45,600 Balance, July 2, 2016 127,377 127,377 1,452,413 3,632,271 (520,775) 4,691,286 Net income — — — 525,278 — 525,278 Translation adjustments and other — — — — 275,581 275,581 Pension liability adjustments, net of tax of$1,181 — — — — 1,328 1,328 Cash dividends — — — (88,657) — (88,657) Repurchases of common stock (6,355) (6,355) — (269,529) — (275,884) Stock-based compensation 2,059 2,059 51,077 — — 53,136 Balance, July 1, 2017 123,081 123,081 1,503,490 3,799,363 (243,866) 5,182,068 Net (loss) income — — — (156,424) — (156,424) Translation adjustments — — — — 7,799 7,799 Pension liability adjustments, net of tax of$18,187 — — — — 40,716 40,716 Cash dividends — — — (88,255) — (88,255) Repurchases of common stock (8,151) (8,151) — (318,790) — (326,941) Stock-based compensation 895 895 25,223 — — 26,118 Balance, June 30, 2018 115,825 $115,825 $1,528,713 $3,235,894 $(195,351) $4,685,081 See notes to consolidated financial statements. 47 Table of ContentsAVNET, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended June 30, July 1, July 2, 2018 2017 2016 (Thousands) Cash flows from operating activities: Net (loss) income $(156,424) $525,278 $506,531 Less: Income (loss) from discontinued operations, net of tax (13,535) 261,927 115,622 Income (loss) from continuing operations (142,889) 263,351 390,909 Non-cash and other reconciling items: Depreciation 143,397 101,407 70,344 Amortization 91,475 53,953 9,246 Deferred income taxes (87,141) (17,705) 107,598 Stock-based compensation 23,990 47,686 56,908 Goodwill impairment expense 181,440 — Other, net 49,383 29,104 29,379 Changes in (net of effects from businesses acquired and divested): Receivables (296,175) (371,820) 191,209 Inventories (308,663) 84,408 (416,644) Accounts payable 409,608 163,604 (326,217) Accrued expenses and other, net 189,060 (132,941) (161,607) Net cash flows provided (used) by operating activities - continuing operations 253,485 221,047 (48,875) Net cash flows (used) provided by operating activities - discontinued operations — (589,738) 273,190 Net cash flows provided (used) by operating activities 253,485 (368,691) 224,315 Cash flows from financing activities: Issuance of notes, net of issuance costs — 296,374 541,500 Repayment of notes — (530,800) (250,000) Borrowings (repayments) under accounts receivable securitization, net (37,000) (588,000) 79,996 Borrowings (repayments) under senior unsecured credit facility, net 8,850 (50,029) 101,200 Borrowings (repayments) under bank credit facilities and other debt, net (97,954) 27,877 18,695 Borrowings of term loans — 530,756 — Repayments of term loans — (511,358) — Repurchases of common stock (323,516) (275,884) (380,943) Dividends paid on common stock (88,255) (88,657) (88,594) Other, net (4,018) (1,870) (11,448) Net cash flows (used) provided by financing activities - continuing operations (541,893) (1,191,591) 10,406 Net cash flows provided by financing activities - discontinued operations — 3,447 22,949 Net cash flows (used) provided by financing activities (541,893) (1,188,144) 33,355 Cash flows from investing activities: Purchases of property, plant and equipment (155,873) (120,397) (137,375) Acquisitions of businesses, net of cash acquired (Note 2) (15,254) (802,744) — Other, net 6,653 18,656 15,574 Net cash flows used for investing activities - continuing operations (164,474) (904,485) (121,801) Net cash flows provided (used) by investing activities - discontinued operations 236,205 2,242,959 (30,712) Net cash flows provided (used) by investing activities 71,731 1,338,474 (152,513) Effect of currency exchange rate changes on cash and cash equivalents 1,418 23,267 (6,232) Cash and cash equivalents: — (decrease) increase (215,259) (195,094) 98,925 — at beginning of period 836,384 1,031,478 932,553 — at end of period $621,125 $836,384 $1,031,478 Additional cash flow information (Note 16) See notes to consolidated financial statements. 48 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. Summary of significant accounting policiesBasis of presentation — The accompanying consolidated financial statements include the accounts of Avnet, Inc. andall of its majority-owned and controlled subsidiaries (the “Company” or “Avnet”). All intercompany and intracompanyaccounts and transactions have been eliminated. Unless indicated otherwise, the information in the Notes to the consolidatedfinancial statements relates to the Company's continuing operations and does not include the results of discontinuedoperations.Reclassifications — Certain prior period amounts have been reclassified to conform to the current period presentationincluding the presentation of discontinued operations.Fiscal year — The Company operates on a “52/53 week” fiscal year, which ends on the Saturday closest to June 30th.Fiscal 2018 and 2017 contain 52 weeks compared to 53 weeks in fiscal 2016. Unless otherwise noted, all references to“fiscal” or any other “year” shall mean the Company’s fiscal year.Management estimates — The preparation of financial statements in conformity with generally accepted accountingprinciples in the United States of America (“GAAP”) requires management to make estimates and assumptions that affectcertain reported amounts of assets and liabilities, reported amounts of sales and expenses and the disclosure of contingentassets and liabilities at the date of the consolidated financial statements. Actual results could differ materially from thoseestimates.Cash and cash equivalents — The Company considers all highly liquid investments with an original maturity of threemonths or less including money market funds to be cash equivalents.Inventories — Inventories, comprised principally of finished goods, are stated at the lower of cost or net realizablevalue, whichever is lower. The Company regularly reviews the cost of inventory against its estimated net realizable value,considering historical experience and any contractual rights of return, stock rotations, obsolescence allowances or priceprotections provided by the Company’s suppliers, and records a lower of cost or net realizable value write-down if anyinventories have a cost in excess of their estimated net realizable value. The Company does not incorporate any non-contractual protections when estimating the net realizable value of its inventories.Depreciation, amortization and useful lives — The Company reports property, plant and equipment at cost, lessaccumulated depreciation. Cost includes the price paid to acquire or construct the assets, required installation costs, interestcapitalized during the construction period, and any expenditure that substantially adds to the value of or substantiallyextends the useful life of an existing asset. Additionally, the Company capitalizes qualified costs related to software obtainedor developed for internal use as a component of property, plant and equipment. Software obtained for internal use hasgenerally been enterprise-level business operations, logistics and finance software that is customized to meet the Company’sspecific operational requirements. The Company begins depreciation and amortization (“depreciation”) for property, plantand equipment when an asset is both in the location and condition for its intended use.Property, plant, and equipment is depreciated using the straight-line method over its estimated useful lives. Theestimated useful lives for property, plant, and equipment are typically as follows: buildings — 30 years; machinery, fixturesand equipment — 2-10 years; information technology hardware and software — 2-10 years; and leasehold improvements —over the applicable minimum lease term or economic useful life if shorter.49 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) The Company amortizes intangible assets acquired in business combinations using the straight-line method over theestimated economic useful lives of the intangible assets from the date of acquisition, which is generally between 5-10 years.Long-lived assets impairment — Long-lived assets, including property, plant and equipment and intangible assets, arereviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset groupmay not be recoverable. For purposes of recognition and measurement of an impairment loss, long-lived assets are groupedwith other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flowsof other assets and liabilities (“asset group”). An impairment is recognized when the estimated undiscounted cash flowsexpected to result from the use of the asset group and its eventual disposition is less than its carrying amount. An impairmentis measured as the amount by which an asset group’s carrying value exceeds its estimated fair value. The Company considersa long-lived asset to be abandoned when it has ceased use of such abandoned asset and if the Company has no intent to useor repurpose the asset in the future. The Company continually evaluates the carrying value and the remaining economicuseful life of long-lived assets and will adjust the carrying value and remaining useful life if and when appropriate.Goodwill — Goodwill represents the excess of the purchase price of acquired businesses over the estimated fair valueassigned to the individual assets acquired and liabilities assumed. The Company does not amortize goodwill, but insteadtests goodwill for impairment at least annually in the fourth quarter and, if necessary, records any impairment resulting fromsuch goodwill impairment testing as a component of operating expenses. Impairment testing is performed at the reportingunit level, which is defined as the same, or one level below, an operating segment. The Company will perform an interimimpairment test between required annual tests if facts and circumstances indicate that it is more likely than not that the fairvalue of a reporting unit that has goodwill is less than its carrying value.In performing goodwill impairment testing, the Company may first make a qualitative assessment of whether it is more-likely-than-not that a reporting unit’s fair value is less than its carrying value. If the qualitative assessment indicates it ismore-likely-than-not that a reporting unit’s fair value is not greater than its carrying value, the Company must perform aquantitative impairment test. The Company defines the fair value of a reporting unit as the price that would be received tosell the reporting unit as a whole in an orderly transaction between market participants as of the impairment test date. Todetermine the fair value of a reporting unit, the Company primarily uses the income approach methodology of valuation,which includes the discounted cash flow method, and the market approach methodology of valuation, which considersvalues of comparable businesses to estimate the fair value of the Company’s reporting units.Significant management judgment is required when estimating the fair value of the Company’s reporting units from amarket participant perspective including the forecasting of future operating results, the discount rates and expected futuregrowth rates used in the discounted cash flow method of valuation, and in the selection of comparable businesses and relatedmarket multiples that are used in the market approach. If the estimated fair value of a reporting unit exceeds the carryingvalue assigned to that reporting unit, goodwill is not impaired. If the estimated fair value of a reporting unit is less than thecarrying value assigned to that reporting unit, then a goodwill impairment loss is measured based on such difference.50 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) Foreign currency translation — The assets and liabilities of foreign operations are translated into U.S. Dollars at theexchange rates in effect at the balance sheet date, with the related translation adjustments reported as a separate componentof shareholders’ equity and comprehensive income (loss). Results of operations are translated using the average exchangerates prevailing throughout the period. Transactions denominated in currencies other than the functional currency of theAvnet subsidiaries that are party to the transactions are remeasured at exchange rates in effect at the balance sheet date orupon settlement of the transaction. Gains and losses from such remeasurements are recorded in the consolidated statements ofoperations as a component of “other income (expense), net.”Income taxes — The Company follows the asset and liability method of accounting for income taxes. Deferred incometax assets and liabilities are recognized for the estimated future tax impact of differences between the consolidated financialstatement carrying amounts of assets and liabilities and their respective tax bases. Deferred income tax assets and liabilitiesare measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recoveredor settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized within income taxexpense in the period in which the new rate is enacted. Based upon historical and estimated levels of future taxable incomeand analysis of other key factors, the Company may increase or decrease a valuation allowance against its deferred tax assets,as deemed necessary, to state such assets at their estimated net realizable value.The Company establishes contingent liabilities for potentially unfavorable outcomes of positions taken on certain taxmatters. These liabilities are based on management’s assessment of whether a tax benefit is more likely than not to besustained upon examination by the relevant tax authorities. There may be differences between the estimated and actualoutcomes of these matters that may result in future changes in estimates to such unrecognized tax benefits. To the extent suchchanges in estimates are required, the Company’s effective tax rate may potentially fluctuate as a result. In accordance withthe Company’s accounting policies, accrued interest and penalties related to unrecognized tax benefits are recorded as acomponent of income tax expense.Self-insurance — In the U.S., the Company is primarily self-insured for medical, workers’ compensation, and general,product and automobile liability costs; however, the Company also has stop-loss insurance policies in place to limit theCompany’s exposure to individual and aggregate claims made. Liabilities for these programs are estimated based uponoutstanding claims and claims estimated to be incurred but not yet reported based upon historical loss experience. Theseestimates are subject to variability due to changes in trends of losses for outstanding claims and incurred but not reportedclaims, including external factors such as the number of and cost of claims, benefit level changes and claim settlementpatterns.Revenue recognition — Revenue from the sale of products or services is recognized when persuasive evidence of anarrangement exists, delivery has occurred or services have been rendered, the sales price is fixed or determinable andcollectability is reasonably assured. Generally, these criteria are met upon either shipment or delivery to customers,depending upon the sales terms.In addition, the Company has certain contractual relationships with its customers and suppliers whereby Avnet assumesan agency relationship in the sales transaction primarily related to the performance of fulfillment logistics services to deliverproduct for which the Company is not the primary obligor. In such agency arrangements, the Company recognizes the net feeassociated with serving as an agent within sales with no associated cost of sales.51 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) Revenues are recorded net of discounts, customer rebates and estimated returns. Provisions are made for discounts andcustomer rebates, which are primarily timing or volume specific, and are estimated based on historical trends and anticipatedcustomer buying patterns. Provisions for returns and other sales adjustments are estimated based on historical sales returnsexperience, credit memo experience and other known factors.Vendor allowances and consideration — Consideration received from suppliers for price protection, product rebates,marketing/promotional activities, or any other programs are recorded when earned under the terms and conditions of suchsupplier programs as adjustments to product costs or selling, general and administrative expenses depending upon the natureand contractual requirements related to the consideration received. Some of these supplier programs require management tomake estimates and may extend over one or more reporting periods.Comprehensive income (loss) — Comprehensive income (loss) represents net income for the year adjusted for certainchanges in shareholders’ equity. Accumulated comprehensive income (loss) items impacting comprehensive income (loss)includes foreign currency translation and the impact of the Company’s pension liability adjustments, net of tax.Stock-based compensation — The Company measures stock-based payments at fair value and generally recognizes theassociated operating expense in the consolidated statements of operations over the requisite service period (see Note 13). Astock-based payment is considered vested for accounting expense attribution purposes when the employee’s retention of theaward is no longer contingent on providing continued service. Accordingly, the Company recognizes all stock-basedcompensation expense for awards granted to retirement eligible employees over the period from the grant date to the dateretirement eligibility is achieved, if less than the stated requisite service period. The expense attribution approach forretirement eligible employees does not affect the overall amount of compensation expense recognized, but insteadaccelerates the recognition of such expense.Restructuring and exit activities — The determination of when the Company accrues for involuntary terminationbenefits under restructuring plans depends on whether the termination benefits are provided under an on-going benefitarrangement or under a one-time benefit arrangement. The Company accounts for on-going benefit arrangements inaccordance with Accounting Standards Codification 712 (“ASC 712”) Nonretirement Postemployment Benefits and accountsfor one-time benefit arrangements in accordance with ASC 420 Exit or Disposal Cost Obligations. If applicable, theCompany records such costs into operating expense over the terminated employee’s future service period beyond anyminimum retention period. Other costs associated with restructuring or exit activities may include contract termination costsincluding operating leases and impairments of long-lived assets, which are expensed in accordance with ASC 420 Exit orDisposal Cost Obligations and ASC 360 Property, Plant and Equipment, respectively.Business combinations — The Company accounts for business acquisitions using the acquisition method ofaccounting and records any identifiable definite-lived intangible assets separate from goodwill. Intangible assets arerecorded at their fair value based on estimates as of the date of acquisition. Goodwill is recorded as the residual amount of thepurchase price consideration less the fair value assigned to the individual identifiable assets acquired and liabilities assumedas of the date of acquisition. Contingent consideration, which represents an obligation of the Company to transfer additionalassets or equity interests to the former owner as part of the purchase price if specified future events occur or conditions aremet, is accounted for at the acquisition date fair value either as a liability or as equity depending on the terms of theacquisition agreement.52 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) Concentration of credit risk — Financial instruments that potentially subject the Company to a concentration of creditrisk principally consist of cash and cash equivalents, marketable securities and trade accounts receivable. The Companyinvests its excess cash primarily in overnight time deposits and institutional money market funds with highly rated financialinstitutions. To reduce credit risk, management performs ongoing credit evaluations of its customers’ financial conditionand, in some instances, has obtained credit insurance coverage to reduce such risk. The Company maintains reserves forpotential credit losses from customers, but has not historically experienced material losses related to individual customers orgroups of customers in any particular end market or geographic area.Fair value — The Company measures financial assets and liabilities at fair value based upon an exit price, representingthe amount that would be received from the sale of an asset or paid to transfer a liability, in an orderly transaction betweenmarket participants. ASC 820, Fair Value Measurements, requires inputs used in valuation techniques for measuring fairvalue on a recurring or non-recurring basis be assigned to a hierarchical level as follows: Level 1 are observable inputs thatreflect quoted prices for identical assets or liabilities in active markets, Level 2 are observable market-based inputs orunobservable inputs that are corroborated by market data and Level 3 are unobservable inputs that are not corroborated bymarket data. During fiscal 2018, 2017, and 2016, there were no transfers of assets measured at fair value between the threelevels of the fair value hierarchy. The carrying amounts of the Company’s financial instruments, including cash and cashequivalents, receivables and accounts payable approximate their fair values at June 30, 2018 due to the short-term nature ofthese assets and liabilities. At June 30, 2018, and July 1, 2017, the Company had $6.1 million and $208.3 million,respectively, of cash equivalents that were measured at fair value based upon Level 1 criteria. The Company’s investments inmarketable securities were also measured at fair value based upon Level 1 criteria. See Note 4 for discussion of the fair valueof the Company’s derivative financial instruments, Note 8 for discussion of the fair value of the Company’s long-term debtand Note 11 for a discussion of the fair value of the Company’s pension plan assets. Derivative financial instruments — See Note 4 for discussion of the Company’s accounting policies related toderivative financial instruments.Marketable securities — The Company determines the classification of investments in marketable securities at the timeof acquisition and reevaluates such designation at each reporting period. The Company has classified its investment inmarketable securities as trading with any realized or unrealized changes in fair value being classified within other (expense)income, net in the consolidated statements of operations. See Note 3 for further discussion about marketable securities.Accounts receivable securitization — The Company has an accounts receivable securitization program whereby theCompany sells certain receivables and retains a subordinated interest and servicing rights to those receivables. Thesecuritization program does not qualify for off-balance sheet sales accounting and is accounted for as a secured financing asdiscussed further in Note 8.Recently adopted accounting pronouncements — In May 2017, the FASB issued ASU 2017-09, "Compensation-StockCompensation (Topic 718): Scope of Modification Accounting" (ASU 2017-09), which provides guidance about whichchanges to the terms or conditions of a share-based payment award require an entity to apply modification accounting inTopic 718. ASU 2017-09 is effective for annual periods beginning after December 15, 2017, with early adoption permitted,including adoption in any interim period for which financial statements have not yet been issued. The Company adopted thisstandard in its fourth quarter of fiscal 2018, which did not have an impact on its consolidated financial statements as therewere no changes to terms and conditions of previously granted share-based payment awards53 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) in the period of adoption. 2. AcquisitionsDragon InnovationIn August 2017, the Company acquired Dragon Innovation, Inc. (“Dragon”), a provider of manufacturing logisticsservices. The impact of this acquisition was not material to the Company’s consolidated balance sheets or consolidatedstatements of operations. 3. Discontinued operationsIn February 2017, the Company completed the sale of its Technology Solutions (“TS”) business to Tech DataCorporation (the “Buyer”). Included in the gain on sale recorded upon completion of the sale in fiscal 2017 were estimatesfor additional cash consideration due from the Buyer related to a closing date net working capital sales price adjustment (the“closing date adjustment”) and income taxes owed by the Company on the gain. The income taxes payable associated withthe gain are impacted by the final geographic allocation of the sales price, which must be agreed to with the Buyer afterdetermination of the closing date adjustment. During the fourth quarter of fiscal 2018, the Company made changes to theestimated closing date adjustment based upon the expected outcome of a negotiated settlement with the Buyer beingprobable of occurring as of June 30, 2018. The Company also made a change in estimate to the income taxes payable on thegain. These changes in estimates in the fourth quarter of fiscal 2018 were not material and are classified within income (loss)from discontinued operations as such changes in estimates impact the gain on the sale of the TS business. In August 2018, subsequent to the end of fiscal 2018, the Company executed a final settlement agreement with theBuyer, the terms of which were consistent with the estimates made as of June 30, 2018, resulting in a final closing dateadjustment of $120.0 million and a final geographic allocation of the TS business sales price for tax reporting purposes. Theincremental consideration received from the sale of the TS business will be classified as cash flow from discontinuedoperations investing activities in the first quarter of fiscal 2019.The Company received 2.8 million shares of the Buyer’s common stock at closing (the “Shares”), which were recordedwithin “Marketable securities” on the Company’s Consolidated Balance Sheets. Unrealized and realized gains or losses dueto changes in fair value based upon Level 1 quoted active market prices of the Shares are recorded in “Other income(expense), net” on the Consolidated Statements of Operations. During fiscal 2017, the Company recorded $34.1 million ofunrealized gains on the shares due to changes in fair value between the closing date and July 1, 2017. The sales agreementincluded time based contractual restrictions related to the Company’s sale of the Shares and as such, the Company enteredinto economic hedges to reduce the Company’s exposure to price fluctuations of the Shares during the restricted period,which fixes the net amount that the Company will realize upon the sale of the Shares. The Company records changes in fairvalue related to the economic share price hedges within “Other income (expense), net”, offsetting the changes in fair value ofthe underlying Shares. During fiscal 2018, the Company sold all of the 2.8 million Shares and the net proceeds of $247.4million have been included in “Cash flows from investing activities – discontinued operations.”In connection with the sale of the TS business, the Company entered into a Transition Services Agreement (“TSA”),pursuant to which the Buyer will pay the Company to provide certain information technology, distribution, facilities, financeand human resources related services for various periods of time depending upon the services not to exceed approximatelytwo years from the closing date. Expenses incurred by the Company to provide such services under the54 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) TSA are classified within selling, general and administrative expenses and amounts billed to the Buyer to provide suchservices are classified as a reduction of such expenses. As of end of fiscal 2018, the Buyer has formally terminatedsubstantially all TSA services outside of certain minor information technology services and all remaining TSA services areexpected to be terminated by the first half of fiscal 2019.Financial results of the TS business for fiscal 2017 and fiscal 2016 including the gain on sale are presented as “Income(loss) from discontinued operations, net of tax” on the Consolidated Statements of Operations and are summarized as follows: Years Ended July 1, July 2, 2017 2016 (Thousands)Sales $5,432,140 $9,478,682Cost of sales 4,883,945 8,519,117Gross profit 548,195 959,565Selling, general and administrative expenses 430,003 710,251Restructuring, integration and other expenses 7,280 34,557Operating income 110,912 214,757Interest and other expense, net (24,291) (22,261)Income from discontinued operations before income taxes 86,621 192,496Income tax expense 47,050 76,874Income from discontinued operations, net of taxes 39,571 115,622Gain on sales of discontinued operations, net of tax 222,356 —Net income from discontinued operations, net of taxes $261,927 $115,622Included within the estimated gain on sale of $222.4 million, net of tax, recorded in fiscal 2017, was $181.5 million ofexpense reclassified out of accumulated comprehensive income primarily related to TS business cumulative translationadjustments.Included within selling, general and administrative expenses of discontinued operations was $34.9 million and $47.3million of corporate expenses specific to or benefiting the TS business for fiscal 2017 and fiscal 2016, respectively.During fiscal 2018, the Company recorded $13.5 million of losses from discontinued operations, net of tax, of which$14.9 million related to pension settlement expenses associated with former TS employee pension withdrawals discussedfurther in Note 11. 4. Derivative financial instrumentsMany of the Company’s subsidiaries purchase and sell products in currencies other than their functional currencies.This subjects the Company to the risks associated with fluctuations in foreign currency exchange rates. The Companyreduces this risk by utilizing natural hedging (e.g., offsetting receivables and payables in the same foreign currency) as wellas by creating offsetting positions through the use of derivative financial instruments, primarily forward foreign exchangecontracts typically with maturities of less than 60 days (“economic hedges”), but no longer than one year. The Companycontinues to have exposure to foreign currency risks to the extent they are not economically hedged. The Company adjustsany economic hedges to fair value through the consolidated statements of operations primarily within55 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) “other income (expense), net.” The fair value of forward foreign exchange contracts, which are based upon Level 2 criteriaunder the ASC 820 fair value hierarchy, are classified in the captions “Prepaid and other current assets” or “accrued expensesand other,” as applicable, in the accompanying consolidated balance sheets as of June 30, 2018, and July 1, 2017. TheCompany’s master netting and other similar arrangements with various financial institutions related to derivative financialinstruments allow for the right of offset. The Company’s policy is to present derivative financial instruments with the samecounterparty as either a net asset or liability when the right of offset exists.The Company generally does not hedge its investments in its foreign operations. The Company does not enter intoderivative financial instruments for trading or speculative purposes and monitors the financial stability and credit standing ofits counterparties.The Company’s foreign currency exposure relates primarily to international transactions where the currency collectedfrom customers can be different from the currency used to purchase from suppliers. The Company’s foreign operationstransactions are denominated primarily in the following currencies: U.S. Dollar, Euro, British Pound, Canadian Dollar,Japanese Yen, Chinese Yuan, Taiwan Dollar and Mexican Peso. The Company also, to a lesser extent, has foreign operationstransactions primarily in other European and Asia/Pacific foreign currencies.The fair values of derivative financial instruments in the Company’s consolidated balance sheets are as follows: June 30, July 1, 2018 2017 (Thousands) Forward foreign currency exchange contracts not receiving hedge accountingtreatment recorded in: Other current assets $2,259 $7,297 Accrued expenses 7,083 4,142 In addition to amounts included in the above table, there was $34.0 million of accrued expenses as of July 1, 2017,related to a derivative financial instrument used to economically hedge the fair value changes in marketable securitiesdiscussed further in Note 3.The amount recorded to other income (expense), net related to derivative financial instruments are as follows: Years Ended June 30, July 1, July 2, 2018 2017 2016 (Thousands) Net derivative financial instrument gain (loss) $2,735 $(8,624) $274 The table above excludes approximately $35.0 million of loss for fiscal 2017, of derivative financial instrument lossesin other income (expenses), net, associated with foreign currency derivative financial instruments purchased to economicallyhedge the British Pound purchase price of the Premier Farnell acquisition and approximately $34.0 million of derivativefinancial instrument losses that economically hedge the unrealized gain from marketable securities, which is also classifiedwithin other income (expenses), net, as discussed further in Note 3.56 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) Under the Company’s economic hedging policies, gains and losses on the derivative financial instruments areclassified within the same line item in the consolidated statements of operations as the remeasurement of the underlyingassets or liabilities being economically hedged. 5. Shareholders’ equityAccumulated comprehensive (loss) incomeThe following table includes the balances within accumulated other comprehensive (loss) income:June 30,July 1,July 2,201820172016(Thousands)Accumulated translation adjustments and other$(78,848)$(86,647)$(362,228)Accumulated pension liability adjustments, net of income taxes(116,503)(157,219)(158,547)Total accumulated other comprehensive (loss) income$(195,351)$(243,866)$(520,775)Amounts reclassified out of accumulated comprehensive (loss) income, net of tax, to operating expenses anddiscontinued operations during fiscal 2018, 2017 and 2016 substantially all related to net periodic pension costs asdiscussed further in Note 11 and cumulative translation adjustment from the sale of the TS business discussed further in Note3.Share repurchase programIn November 2017, the Company’s Board of Directors amended the Company’s existing share repurchase program toauthorize the repurchase of up to $1.95 billion of common stock in the open market or through privately negotiatedtransactions. The timing and actual number of shares repurchased will depend on a variety of factors such as share price,corporate and regulatory requirements, and prevailing market conditions. During fiscal 2018, the Company repurchased 8.2million shares under this program at an average market price of $40.11 per share for a total cost of $326.9 million.Repurchased shares were retired. Since the beginning of the repurchase program through the end of fiscal 2018, the Companyhas repurchased 45.9 million shares at an aggregate cost of $1.68 billion, and $272.1 million remains available for futurerepurchases under the share repurchase program.Common stock dividendDuring fiscal 2018, the Company paid dividends of $0.74 per common share and $88.3 million in total. 57 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) 6. Property, plant and equipment, netProperty, plant and equipment are recorded at cost and consist of the following: June 30, 2018 July 1, 2017 (Thousands) Buildings $132,511 $136,846 Machinery, fixtures and equipment 200,231 215,155 Information technology hardware and software 677,179 630,352 Leasehold improvements 106,242 99,208 Depreciable property, plant and equipment, gross 1,116,163 1,081,561 Accumulated depreciation (758,041) (667,700) Depreciable property, plant and equipment, net 358,122 413,861 Land 41,984 41,627 Construction in progress 122,803 64,087 Property, plant and equipment, net $522,909 $519,575 Depreciation expense including accelerated depreciation related to property, plant and equipment was $143.4 million,$101.4 million and $70.3 million in fiscal 2018, 2017 and 2016, respectively. Interest expense capitalized during fiscal2018, 2017 and 2016 was not material.Included as a component of restructuring, integration and other expenses was $52.9 million and $16.0 million ofaccelerated depreciation expense for fiscal 2018 and 2017, respectively, associated with the changes in estimates of theuseful life of the Company’s existing ERP system in the Americas. 7. Goodwill and intangible assetsThe following table presents the change in goodwill balances by reportable segment for fiscal year 2018. Electronic Premier Components Farnell Total (Thousands)Carrying value at July 1, 2017 $635,048 $513,299 $1,148,347Additions from acquisitions 24,435 — 24,435Impairment of goodwill (181,440) — (181,440)Foreign currency translation 936 3,202 4,138Measurement period adjustments 720 (15,328) (14,608)Carrying value at June 30, 2018 $479,699 $501,173 $980,872(1) Includes accumulated impairment of $1,045.1 million from fiscal 2009(2) Includes accumulated impairment of $1,045.1 million from fiscal 2009 and $181.4 million from fiscal 2018In the third quarter of fiscal 2018, in conjunction with the commencement of the Company’s annual long-termplanning process, it became apparent that lower cash flows are expected from the EC Americas core reporting unit (the“Americas”) over such planning horizon compared to prior year long-term cash flow expectations. As a result of the lowerexpected cash flows as well as certain other factors, the Company concluded that an interim quantitative goodwillimpairment test for the Americas was necessary in the third quarter of fiscal 2018. 58 (1)(2) Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) In assessing the Americas goodwill for impairment in the third quarter of fiscal 2018, the Company was required tomake significant judgments related to the fair value of the Americas. The Company used a combination of an incomeapproach, specifically a discounted cash flow methodology, and a market approach to estimate the fair value of the Americas.The discounted cash flow methodology includes market participant assumptions for, among other factors, forecasted sales,gross profit margins, operating expenses, cash flows, perpetual growth rates and long-term discount rates, all of whichrequired judgments and estimates by management which are inherently uncertain. The market approach methodologyrequired significant assumptions related to comparable transactions, market multiples, capital structure and controlpremiums.As a result of the impairment testing and related fair value estimate of the Americas in the third quarter of fiscal 2018,the Company impaired goodwill in the Americas region of the EC operating group and recorded $181.4 million of goodwillimpairment expense, which is classified within goodwill impairment expense in the Consolidated Statements of Operations.The $181.4 million of goodwill for the Americas primarily represented goodwill allocated from the acquisitions of BellMicro, G2 and Round2, all of which occurred prior to fiscal 2011.During the fourth quarter of fiscal 2018, the Company performed annual goodwill impairment testing for its remainingreporting units that have goodwill using a combination of qualitative and quantitative impairment testing and concludedthat there was no impairment of goodwill. There was no impairment of goodwill in fiscal 2017 and fiscal 2016 based uponthe Company’s annual impairment tests performed in the fourth quarters of fiscal 2017 and 2016.During the first quarter of fiscal 2018, the Company finalized its estimated acquisition date fair values for assetsacquired and liabilities assumed related to the Premier Farnell acquisition, which occurred in October of fiscal 2017. Theimpact of these measurement period adjustments resulted in a decrease to goodwill of $15.3 million, a net increase inintangible assets of $24.9 million, and an increase in other long-term liabilities of $9.6 million.The following table presents the Company’s acquired identifiable intangible assets: June 30, 2018 July 1, 2017 Acquired Accumulated Net Book Acquired Accumulated Net Book Amount Amortization Value Amount Amortization Value (Thousands) Customer related $300,126 $(148,416) $151,710 $277,865 $(79,578) $198,287 Trade name 54,391 (16,711) 37,680 46,915 (6,720) 40,195 Technology and other 52,793 (22,270) 30,523 50,369 (11,560) 38,809 $407,310 $(187,397) $219,913 $375,149 $(97,858) $277,291 Intangible asset amortization expense was $91.5 million, $54.0 million and $9.2 million for fiscal 2018, 2017 and2016, respectively. Intangible assets have a weighted average remaining useful life of approximately 3 years as of June 30,2018.59 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) The following table presents the estimated future amortization expense for the next five fiscal years and thereafter (inthousands): Fiscal Year 2019 $83,4122020 81,2012021 39,1372022 12,3362023 3,595Thereafter 232Total $219,913 8. DebtShort-term debt consists of the following (in thousands): June 30, 2018 July 1, 2017 June 30, 2018 July 1, 2017 Interest Rate Carrying Balance Bank credit facilities and other 2.91% 2.27% $60,380 $50,113 Accounts receivable securitization program 2.63% — 105,000 — Short-term debt $165,380 $50,113 Bank credit facilities and other consist of various committed and uncommitted lines of credit and other forms of bankdebt with financial institutions utilized primarily to support the working capital requirements of the Company including itsforeign operations.The Company has an accounts receivable securitization program (the “Program”) in the United States with a group offinancial institutions to allow the Company to transfer, on an ongoing revolving basis, an undivided interest in a designatedpool of trade accounts receivable, to provide security or collateral for borrowings up to a maximum of $400.0 million. TheProgram does not qualify for off-balance sheet accounting treatment and any borrowings under the Program are recorded asdebt in the consolidated balance sheets. Under the Program, the Company legally sells and isolates certain U.S. tradeaccounts receivable into a wholly owned and consolidated bankruptcy remote special purpose entity. Such receivables,which are recorded within “Receivables” in the consolidated balance sheets, totaled $790.5 million and $807.5 million atJune 30, 2018, and July 1, 2017, respectively. The Program contains certain covenants relating to the quality of thereceivables sold. The Program also requires the Company to maintain certain minimum interest coverage and leverage ratios,which the Company was in compliance with as of June 30, 2018. The Program expires in August 2018 and as a result theCompany has classified outstanding balances as short-term debt as of June 30, 2018. There were $105.0 million inborrowings outstanding under the Program as of June 30, 2018, and $142.0 million as of July 1, 2017. Interest on borrowingsis calculated using a base rate or a commercial paper rate plus a spread of 0.40%. The facility fee is 0.40%.In August 2018, subsequent to the end of fiscal 2018, the Company amended and extended the Program for a two-yearterm that expires in August 2020. The maximum borrowings of the Program increased to $500.0 million with interest onborrowings being calculated using a one-month LIBOR rate plus a spread of 0.75%. The facility fee on the unused balance ofthe facility is up to 0.35%. The Program continues to require the same historical financial covenants related to minimuminterest coverage and leverage ratios.60 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) Long-term debt consists of the following (in thousands): June 30, 2018 July 1, 2017 June 30, 2018 July 1, 2017 Interest Rate Carrying Balance Revolving credit facilities: Accounts receivable securitization program — 1.53% $ — $142,000 Credit Facility — 2.77% — 99,970 Public notes due: June 2020 5.88% 5.88% 300,000 300,000 December 2021 3.75% 3.75% 300,000 300,000 December 2022 4.88% 4.88% 350,000 350,000 April 2026 4.63% 4.63% 550,000 550,000 Other long-term debt 1.26% 1.36% 383 642 Long-term debt before discount and debt issuancecosts 1,500,383 1,742,612 Discount and debt issuance costs – unamortized (11,164) (13,400) Long-term debt $1,489,219 $1,729,212 In June 2018, the Company amended the five-year $1.25 billion senior unsecured revolving credit facility (the “CreditFacility”) with a syndicate of banks, consisting of revolving credit facilities and the issuance of up to $200.0 million ofletters of credit and up to $300.0 million of loans in certain approved currencies, which expires in June 2023. Subject tocertain conditions, the Credit Facility may be increased up to $1.50 billion. Under the Credit Facility, the Company mayselect from various interest rate options, currencies and maturities. The Credit Facility contains certain covenants includingvarious limitations on debt incurrence, share repurchases, dividends, investments and capital expenditures. The CreditFacility also includes financial covenants requiring the Company to maintain minimum interest coverage and leverageratios, which the Company was in compliance with as of June 30, 2018. At June 30, 2018 and July 1, 2017 there were $2.0million and $3.1 million, respectively, in letters of credit issued under the Credit Facility.Aggregate debt maturities for the next five fiscal years and thereafter are as follows (in thousands):2019 $165,380 2020 300,241 2021 102 2022 300,027 2023 350,013 Thereafter 550,000 Subtotal 1,665,763 Discount and debt issuance costs – unamortized (11,164) Total debt $1,654,599 At June 30, 2018, the carrying value and fair value of the Company’s debt was $1.65 billion and $1.67 billion,respectively. At July 1, 2017, the carrying value and fair value of the Company’s debt was $1.78 billion and $1.85 billion,respectively. Fair value for the public notes was estimated based upon quoted market prices and for other debt instrumentsfair value approximates carrying value due to the market based variable nature of the interest rates on those debt facilities. 61 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) 9. Accrued expenses and otherAccrued expenses and other consist of the following: June 30, 2018 July 1, 2017 (Thousands) Accrued salaries and benefits $220,245 $205,979 Accrued operating costs 98,801 104,747 Accrued interest and banking costs 16,505 47,481 Accrued restructuring costs 29,225 16,996 Accrued income taxes 108,386 61,552 Accrued property, plant and equipment 23,400 6,491 Accrued other 38,041 98,777 Total accrued expenses and other $534,603 $542,023 10. Income taxesThe components of income tax expense (“tax provision”) are included in the table below. The tax provision fordeferred income taxes results from temporary differences arising primarily from net operating losses, inventories valuation,receivables valuation, certain accrued amounts and depreciation and amortization, net of any changes to valuationallowances. Years Ended June 30, 2018 July 1, 2017 July 2, 2016 (Thousands) Current: Federal $255,810 $(45,351) $(16,934) State and local (3,174) 4,209 (33) Foreign 104,156 106,441 92,033 Total current taxes 356,792 65,299 75,066 Deferred: Federal (70,172) (30,025) 5,573 State and local (10,551) (3,934) 1,351 Foreign 11,897 15,713 5,114 Total deferred taxes (68,826) (18,246) 12,038 Income tax expense $287,966 $47,053 $87,104 The tax provision is computed based upon income from continuing operations before income taxes from both U.S. andforeign operations. U.S. income (loss) from continuing operations before income taxes was $(385.1) million, $(174.3) millionand $(2.7) million, in fiscal 2018, 2017 and 2016, respectively, and foreign income from continuing operations beforeincome taxes was $530.2 million, $484.7 million and $480.7 million in fiscal 2018, 2017 and 2016, respectively.See further discussion related to income tax expense for discontinued operations in Note 3.On December 22, 2017 the U.S. federal government enacted tax legislation (the “Act”) which includes provisions tolower the corporate income tax rate from 35% to 21%, impose new taxes on certain foreign earnings, limit deductibility ofcertain U.S. costs and levy a one-time deemed repatriation tax on accumulated offshore earnings, among other provisions.The law is subject to interpretation and implementation guidance by both federal and state tax authorities, as well asamendments and technical corrections. 62 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) As a fiscal year-end taxpayer, certain provisions of the Act began to impact the Company in the second quarter of fiscal2018, while other provisions will impact the Company beginning in fiscal 2019. The corporate tax rate reduction is effectiveas of January 1, 2018, resulting in a 2018 federal statutory rate of 28.0% for the Company’s fiscal 2018.During the third quarter of fiscal 2018, the Company recorded a provisional amount for the one-time mandatorydeemed repatriation tax liability (the “transition tax”) of $230.0 million of which $22.0 million is classified as a currentincome tax liability. The Company will continue to refine the provisional amount under Staff Accounting Bulletin 118(“SAB 118”) during the measurement period due to substantiation of foreign-based earnings and profits and foreign taxcredits and the utilization of those foreign tax credits. Additionally, new guidance from regulators, interpretation of the law,and refinement of the Company’s estimates from ongoing analysis of tax positions may change the provisional amountsrecorded. Any changes in the provisional amount recorded will be reflected in income tax expense in the period they areidentified, and may be material.During the second quarter of fiscal year 2018, the Company recorded a provisional amount related to theremeasurement of deferred taxes at the new expected tax rates. In the fourth quarter of fiscal 2018, the Company revised theestimated impact to $6.0 million. This estimate is provisional as the Company continues to analyze the impacts of the Act,including state income tax conformity considerations.The Company continues to evaluate the impact of the Act including the Company’s historical assertion related to ASC740 Income Taxes unremitted earnings. The Company has not changed its historical assertion as of June 30, 2018 that itsASC 740 unremitted earnings are permanently reinvested. The Company believes any unrecorded liabilities related to thisassertion are not material.Reconciliations of the federal statutory tax rate to the effective tax rates are as follows: Years Ended June 30, 2018 July 1, 2017 July 2, 2016 U.S. federal statutory rate 28.0% 35.0% 35.0% State and local income taxes, net of federal benefit (6.1) (1.7) 0.3 Foreign tax rates, net of valuation allowances (23.5) (23.5) (12.7) Establishment/(release) of valuation allowance, net of U.S. tax expense (0.1) 1.3 (1.7) Change in contingency reserves (7.4) 3.6 (2.5) Tax audit settlements 4.5 0.1 (0.7) Impact of the Act - transition tax 158.5 — — Impact of the Act - deferred tax effects 4.2 — — Goodwill impairment 35.1 — — Other, net 5.3 0.4 0.5 Effective tax rate - continuing operations 198.5% 15.2% 18.2% Foreign tax rates represents the impact of the difference between foreign rates and U.S. federal statutory rates applied toforeign income or loss and also includes the impact of valuation allowances established against the Company’s otherwiserealizable foreign deferred tax assets, which are primarily net operating loss carry-forwards.63 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) Avnet’s effective tax rate on income before income taxes from continuing operations was 198.5% in fiscal 2018 ascompared with an effective tax rate of 15.2% in fiscal 2017. Included in the fiscal 2018 effective tax rate is a net tax benefitof $34.1 million related to the mix of income in lower tax jurisdictions. The fiscal 2018 effective tax rate is higher than thefiscal 2017 effective tax rate due to the favorable mix of income, offset by tax expense from the transition tax and thegoodwill impairment which was not tax deductible.The Company applies the guidance in ASC 740 Income Taxes, which requires management to use its judgment to theappropriate weighting of all available evidence when assessing the need for the establishment or the release of valuationallowances. As part of this analysis, the Company examines all available evidence on a jurisdiction by jurisdiction basis andweighs the positive and negative evidence when determining the need for full or partial valuation allowances. The evidenceconsidered for each jurisdiction includes, among other items: (i) the historic levels and types of income or losses over a rangeof time periods, which may extend beyond the most recent three fiscal years depending upon the historical volatility ofincome in an individual jurisdiction; (ii) expectations and risk associated with underlying estimates of future taxableincome, including considering the historical trend of down-cycles in the Company’s served industries; (iii) jurisdictionalspecific limitations on the utilization of deferred tax assets including when such assets expire; and (iv) prudent and feasibletax planning strategies.The significant components of deferred tax assets and liabilities, included in “other assets” and “other liabilities” onthe consolidated balance sheets, are as follows: June 30, July 1, 2018 2017 (Thousands) Deferred tax assets: Federal, state and foreign net operating loss carry-forwards $296,282 $269,576 Inventories valuation 26,125 30,330 Receivables valuation 8,332 9,209 Various accrued liabilities and other 39,419 46,922 370,158 356,037 Less — valuation allowances (239,483) (241,687) 130,675 114,350 Deferred tax liabilities: Depreciation and amortization of property, plant and equipment (84,250) (152,101) Net deferred tax assets (liabilities) $46,425 $(37,751) In addition to net deferred tax assets (liabilities), the Company also has $70.1 million and $90.4 million of income taxrelated deferred charges included as a component of “other assets” in the consolidated balance sheets as of June 30, 2018,and July 1, 2017, respectively. The change in valuation allowances in fiscal 2018 from fiscal 2017 was primarily due to the expiration of $4.0 millionof losses with a related valuation allowance.64 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) As of June 30, 2018, the Company had net operating and capital loss carry-forwards of approximately $1.23 billion, ofwhich $40.0 million will expire during fiscal 2019 and fiscal 2020, substantially all of which have full valuation allowances,$87.2 million have expiration dates ranging from fiscal 2021 to fiscal 2038, and the remaining $1.10 billion have noexpiration date. The carrying value of the Company’s net operating and capital loss carry-forwards is dependent upon theCompany’s ability to generate sufficient future taxable income in certain foreign tax jurisdictions. In addition, the Companyconsiders historic levels and types of income or losses, expectations and risk associated with estimates of future taxableincome and ongoing prudent and feasible tax planning strategies in assessing the need for valuation allowances.Estimated liabilities for unrecognized tax benefits are included in “accrued expenses and other” and “other liabilities”on the consolidated balance sheets. These contingent liabilities relate to various tax matters that result from uncertainties inthe application of complex income tax regulations in the numerous jurisdictions in which the Company operates. As of June30, 2018, unrecognized tax benefits were $106.6 million. The estimated liability for unrecognized tax benefits includedaccrued interest expense and penalties of $22.2 million and $15.3 million, net of applicable state tax benefits, as of the endof fiscal 2018 and 2017, respectively.Reconciliations of the beginning and ending liability balances for unrecognized tax benefits are as follows: June 30, 2018 July 1, 2017 (Thousands) Balance at beginning of year $106,786 $58,830 Additions for tax positions taken in prior periods, including interest 22,362 10,476 Reductions for tax positions taken in prior periods, including interest (18,753) (5,656) Additions for tax positions taken in current period 13,476 13,659 Reductions related to settlements with taxing authorities (6,674) (203) Reductions related to the lapse of applicable statutes of limitations (14,355) (5,790) Adjustments related to foreign currency translation 673 2,772 Activity of discontinued operations — 10,864 Additions from acquisitions 3,089 21,834 Balance at end of year $106,604 $106,786 The evaluation of income tax positions requires management to estimate the ability of the Company to sustain itsposition and estimate the final benefit to the Company. To the extent that these estimates do not reflect the actual outcomethere could be an impact on the consolidated financial statements in the period in which the position is settled, theapplicable statutes of limitations expire or new information becomes available as the impact of these events are recognized inthe period in which they occur. It is difficult to estimate the period in which the amount of a tax position will change assettlement may include administrative and legal proceedings whose timing the Company cannot control. The effects ofsettling tax positions with tax authorities and statute expirations may significantly impact the estimate for unrecognized taxbenefits. Within the next twelve months, the Company estimates that approximately $35.8 million of these liabilities forunrecognized tax benefits will be settled by the expiration of the statutes of limitations or through agreement with the taxauthorities for tax positions related to valuation matters and positions related to acquired entities. The expected cashpayment related to the settlement of these contingencies is approximately $9.9 million.65 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) The Company conducts business globally and consequently files income tax returns in numerous jurisdictionsincluding those listed in the following table. It is also routinely subject to audit in these and other countries. The Company isno longer subject to audit in its major jurisdictions for periods prior to fiscal 2008. The years remaining subject to audit, bymajor jurisdiction, are as follows:Jurisdiction Fiscal Year United States (Federal and state) 2014 - 2018 Taiwan 2013 - 2018 Hong Kong 2012 - 2018 Germany 2010 - 2018 Singapore 2008 - 2018 Belgium 2015 - 2018 United Kingdom 2016 - 2018 Canada 2011 - 2018 In connection with the sale of the TS business during fiscal 2017, several legal entities were sold to the Buyer and post-closing tax obligations are the responsibility of the Buyer. Under the terms of the sale agreement, the Company stillmaintains responsibility for certain pre-closing taxes including any amounts that arise from audits or other judgmentsreceived from tax authorities. The Company believes that its current estimates related to tax reserves and unrecognized taxbenefits related to the TS business are reasonable, but future changes in facts and circumstances could results in significantchanges in estimates that impact tax expense from discontinued operations in the period of change. 11. Pension and retirement plansPension PlanThe Company’s principal defined benefit plan is a noncontributory defined benefit pension plan covering substantiallyall U.S. Employees (the “Plan”). In connection with the Company’s acquisition of Premier Farnell (“PF”) in fiscal 2017, theCompany assumed all of PF’s defined benefit obligations and related plan assets, including a closed noncontributory definedbenefit pension plan in the U.S., which was merged with the Plan in January 2018.The Company’s Plan meets the definition of a defined benefit plan and as a result, the Company applies ASC 715pension accounting to the Plan. The Plan is a cash balance plan that is similar in nature to a defined contribution plan in thata participant’s benefit is defined in terms of stated account balances. The cash balance plan provides the Company with thebenefit of applying any earnings on the Plan’s investments beyond the fixed return provided to participants, toward theCompany’s future cash funding obligations. Employees are eligible to participate in the Plan following the first year ofservice during which they worked at least 1,000 hours.The Plan provides defined benefits pursuant to a cash balance feature whereby a participant accumulates a benefitbased upon a percentage of current salary, which varies with age, and interest credits. The Company uses its fiscal year end asthe measurement date for determining pension expense and benefit obligations for each fiscal year.66 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) The following table outlines changes in benefit obligations, plan assets and the funded status of the Plan as of the endof fiscal 2018 and 2017: June 30, July 1, 2018 2017 (Thousands) Changes in benefit obligations: Benefit obligations at beginning of year $772,068 $588,511 Acquired benefit obligations — 165,046 Service cost 15,834 29,623 Interest cost 23,732 19,323 Actuarial (gain) loss (35,560) 15,686 Benefits paid (23,499) (46,121) Settlements paid (67,415) — Benefit obligations at end of year $685,160 $772,068 Changes in plan assets: Fair value of plan assets at beginning of year $699,365 $516,089 Acquired plan assets — 144,238 Actual return on plan assets 34,587 51,409 Benefits paid (23,499) (46,121) Settlements paid (67,415) — Contributions 16,000 33,750 Fair value of plan assets at end of year $659,038 $699,365 Funded status of the plan recognized as a non-current liability $(26,122) $(72,703) Amounts recognized in accumulated other comprehensive income: Unrecognized net actuarial losses $182,633 $234,863 Unamortized prior service cost (credit) 857 (691) $183,490 $234,172 Other changes in plan assets and benefit obligations recognized in other comprehensiveincome: Net actuarial (gain) loss $(15,461) $9,744 Amortization of net actuarial losses (14,404) (14,440) Amortization of prior service credits 1,573 1,573 Settlement expenses (22,365) — Curtailment recognition of prior service credit — 614 $(50,657) $(2,509) Included in accumulated other comprehensive (loss) income at June 30, 2018 is a before tax expense of $182.6 millionof net actuarial losses that have not yet been recognized in net periodic pension cost, of which $10.0 million is expected tobe recognized as a component of net periodic pension cost during fiscal 2019. Also included is a before tax net cost of $0.9million of prior service credits that have not yet been recognized in net periodic pension costs, of which $1.6 million isexpected to be recognized as a component of net periodic pension costs during fiscal 2019.In connection with the sale of the TS business, a significant number of former employees became terminated vestedemployees under the Plan. During fiscal 2018, the aggregate amount of former employee withdrawals from the Plan exceededthe pension accounting settlement threshold for fiscal 2018, which required a settlement expense under ASC 71567 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) pension accounting. As a result, the Company recognized a $22.4 million of pension settlement expenses before taxes and$14.9 million after taxes in fiscal 2018, respectively, classified within income (loss) from discontinued operations.Assumptions used to calculate actuarial present values of benefit obligations are as follows: 2018 2017 Discount rate 4.2% 3.8% The discount rate selected by the Company for the Plan reflects the current rate at which the underlying liability couldbe settled at the measurement date as of June 30, 2018. The estimated discount rate in fiscal 2018 and fiscal 2017 was basedon the spot yield curve approach, which applies the individual spot rates from a highly rated bond yield curve to each futureyear’s estimated cash flows.Assumptions used to determine net benefit costs are as follows: 2018 2017 Discount rate 3.4%3.3%Expected return on plan assets 8.0%8.0%Components of net periodic pension cost from continuing and discontinued operations during the last three fiscal yearsare as follows: Years Ended June 30, July 1, July 2, 2018 2017 2016 (Thousands) Service cost $15,834 $29,623 $39,740 Interest cost 23,732 19,323 21,310 Expected return on plan assets (54,686) (49,279) (40,285) Amortization of prior service credits (1,573) (1,573) (1,573) Recognized net actuarial loss 14,404 14,440 12,731 Curtailment recognition of prior service credit — (614) — Pension settlement charge 22,365 — — Net periodic pension cost $20,076 $11,920 $31,923 (1)Includes discontinued operationsThe Company made $16.0 million and $33.8 million of contributions in fiscal 2018 and fiscal 2017, respectively, andexpects to make approximately $16.0 million of contributions in fiscal 2019.68 (1)(1) Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) Benefit payments are expected to be paid to Plan participants as follows for the next five fiscal years and the aggregatefor the five years thereafter (in thousands):2019$42,457 2020 37,292 2021 40,034 2022 44,000 2023 46,160 2024 through 2028 256,003 The Plan’s assets are held in trust and were allocated as follows as of the measurement date at the end of fiscal 2018 and2017: 2018 2017 Equity securities 60% 50% Fixed income debt securities 39% 50% Cash and cash equivalents 1% —% The general investment objectives of the Plan are to maximize returns through a diversified investment portfolio inorder to earn annualized returns that meet the long-term cost of funding the Plan’s pension obligations while maintainingreasonable and prudent levels of risk. The target rate of return on the Plan’s assets is currently 8.0%, which represents theaverage rate of earnings expected on the funds invested or to be invested to provide for the benefits included in the benefitobligation based upon the targeted investment allocations. This assumption has been determined by combining expectationsregarding future rates of return for the investment portfolio along with the historical and expected distribution of investmentsby asset class and the historical rates of return for each of those asset classes. The mix of equity securities is typicallydiversified to obtain a blend of domestic and international investments covering multiple industries. The Plan’s assets do notinclude any material investments in Avnet common stock. The Plan’s investments in debt securities are also diversifiedacross both public and private fixed income securities with varying maturities. As of June 30, 2018, the Company’s targetallocation for the Plan’s investment portfolio is for equity securities, both domestic and international, to representapproximately 60% of the portfolio. The majority of the remaining portfolio of investments is to be invested in fixed incomedebt securities with various maturities.The following table sets forth the fair value of the Plan’s investments as of June 30, 2018: Level 1 Level 2 Level 3 Total (Thousands) Cash and cash equivalents $7,291 $ — $ — $7,291 Equities: U.S. common stocks — 262,066 — 262,066 International common stocks — 133,564 — 133,564 Fixed Income: U.S. government agencies — 96,414 — 96,414 U.S. and international corporate bonds — 133,645 — 133,645 Other — 26,058 — 26,058 Total $7,291 $651,747 $ — $659,038 69 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) The following table sets forth the fair value of the Plan’s investments as of July 1, 2017: Level 1 Level 2 Level 3 Total (Thousands) Cash and cash equivalents $1,481 $ — $ — $1,481 Equities: U.S. common stocks — 221,003 — 221,003 International common stocks — 117,392 — 117,392 Fixed Income: U.S. government agencies — 105,227 — 105,227 International government agencies — 14,366 — 14,366 U.S. corporate bonds — 214,024 — 214,024 Other — 25,872 — 25,872 Total $1,481 $697,884 $ — $699,365 The fair value of the Plan’s investments in equity and fixed income investments are stated at unit value, or theequivalent of net asset value, which is a practical expedient for estimating the fair values of those investments. Each of theseinvestments may be redeemed daily without notice and there were no material unfunded commitments as of June 30, 2018. 12. Operating leasesThe Company leases many of its operating facilities and is also committed under lease agreements for transportationand operating equipment. Rent expense charged to operating expenses during the last three fiscal years is as follows: Years Ended June 30, July 1, July 2, 2018 2017 2016 (Thousands) Rent expense under operating leases $75,006 $71,814 $66,702 The aggregate future minimum operating lease commitments, principally for office and warehouse space, in fiscal 2019through 2023 and thereafter, are as follows (in thousands): 2019 $73,667 2020 56,182 2021 42,211 2022 34,688 2023 28,196 Thereafter 82,174 Total $317,118 70 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) 13. Stock-based compensationThe Company measures all stock-based payments at fair value and recognizes related expense within operatingexpenses in the consolidated statements of operations over the requisite service period (generally the vesting period). Duringfiscal 2018, 2017, and 2016, the Company recorded stock-based compensation expense of $24.0 million, $53.9 million, and$56.9 million, respectively, for all forms of stock-based compensation awards. Included in the fiscal 2017 expense was $6.2million of stock-based compensation related to discontinued operations and the divestiture of the TS business discussedfurther in Note 3.Stock planAt June 30, 2018, the Company had 9.3 million shares of common stock reserved for stock-based payments, whichconsisted of 2.3 million shares for unvested or unexercised stock options, 5.4 million shares available for stock-based awardsunder plans approved by shareholders, 1.5 million shares for restricted stock units and performance share units granted butnot yet vested, and 0.1 million shares available for future purchases under the Company’s Employee Stock Purchase Plan.Stock optionsService based stock option grants have a contractual life of ten years, vest in 25% increments on each anniversary ofthe grant date, commencing with the first anniversary, and require an exercise price of 100% of the fair market value ofcommon stock at the date of grant. Stock-based compensation expense associated with all stock options during fiscal 2018,2017 and 2016 was $(0.2) million, $5.8 million and $4.2 million, respectively.The fair value of stock options is estimated as of the date of grant using the Black-Scholes model based on theassumptions in the following table. The assumption for the expected term is based on evaluations of historical and expectedfuture employee exercise behavior. The risk-free interest rate is based on U.S. Treasury rates as of the date of grant withmaturity dates approximately equal to the expected term at the grant date. The historical volatility of Avnet’s common stockis used as the basis for the volatility assumption. The Company estimates dividend yield based upon expectations of futuredividends compared to the market value of the Company’s stock as of the grant date. Years Ended June 30, July 1, July 2, 2018 2017 2016 Expected term (years) 6.0 6.0 6.0 Risk-free interest rate 2.0% 1.9% 1.7% Weighted average volatility 26.3% 27.9% 29.7% Dividend yield 2.0% 1.5% 1.9% 71 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) The following is a summary of the changes in outstanding options for fiscal 2018: Weighted Weighted Average Average Remaining Shares Exercise Price Contractual Life Outstanding at July 1, 2017 2,714,506 $40.51 82 Months Granted 303,792 37.02 110 Months Exercised (405,737) 33.23 27 Months Forfeited or expired (290,774) 43.62 95 Months Outstanding at June 30, 2018 2,321,787 $40.93 79 Months Exercisable at June 30, 2018 866,553 $35.62 49 Months The weighted-average grant-date fair values of stock options granted during fiscal 2018, 2017 and 2016 were$8.33, $9.46 and $10.69, respectively.At June 30, 2018, the aggregate intrinsic value of all outstanding stock option awards was $8.4 million and allexercisable stock option awards was $6.4 million. The following is a summary of the changes in non-vested stock options for the fiscal year 2018: Weighted Average Grant-Date Shares Fair Value Non-vested stock options at July 1, 2017 1,678,763 $11.56 Granted 303,792 8.33 Vested (288,461) 12.32 Forfeited (238,860) 9.66 Non-vested stock options at June 30, 2018 1,455,234 $11.05 As of June 30, 2018, there was $2.1 million of total unrecognized compensation cost related to stock options, which isexpected to be recognized over a weighted-average period of 1.6 years. The total fair value of stock options vested, as of thevesting dates, during fiscal 2018, 2017 and 2016 were $3.6 million, $3.3 million and $4.6 million, respectively.Cash received from stock option exercises during fiscal 2018, 2017, and 2016 totaled $9.2 million, $25.2 million, and$0.8 million, respectively. The impact of these cash receipts is included in “Other, net” within financing activities in theaccompanying consolidated statements of cash flows.Restricted stock unitsDelivery of restricted stock units, and the associated compensation expense, is recognized over the vesting period andis generally subject to the employee’s continued service to the Company, except for employees who are retirement eligibleunder the terms of the restricted stock units. As of June 30, 2018, 1.0 million shares previously awarded have not yet vested.Stock-based compensation expense associated with restricted stock units was $23.0 million, $42.4 million and $43.9 millionfor fiscal years 2018, 2017 and 2016, respectively.72 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) The following is a summary of the changes in non-vested restricted stock units during fiscal 2018: Weighted Average Grant-Date Shares Fair Value Non-vested restricted stock units at July 1, 2017 1,016,028 $40.93 Granted 800,448 35.97 Vested (662,222) 39.29 Forfeited (118,094) 37.91 Non-vested restricted stock units at June 30, 2018 1,036,160 $38.48 As of June 30, 2018, there was $21.5 million of total unrecognized compensation expense related to non-vestedrestricted stock units, which is expected to be recognized over a weighted-average period of 2.2 years. The total fair value ofrestricted stock units vested during fiscal 2018, 2017 and 2016 was $26.0 million, $54.6 million and $42.5 million,respectively.Performance share unitsCertain eligible employees, including Avnet’s executive officers, may receive a portion of their long-term stock-basedcompensation through the performance share program, which allows for the vesting of shares based upon achievement ofcertain market and performance-based criteria (“Performance Share Program”). The Performance Share Program provides forthe vesting to each grantee of a number of shares of Avnet’s common stock at the end of a three-year performance periodbased upon the Company’s achievement of certain performance goals established by the Compensation Committee of theBoard of Directors for each Performance Share Program three-year performance period. The performance goals consist of acombination of measures including economic profit, return on capital employed and total shareholder return.During each of fiscal 2018, 2017 and 2016, the Company granted 0.2 million performance share units. The actualamount of performance share units vested at the end of each three-year period is measured based upon the actual level ofachievement of the defined performance goals and can range from 0% to 200% of the award grant. During fiscal 2018, 2017and 2016, the Company recognized stock-based compensation expense associated with the Performance Share Program of$0.2 million, $4.6 million and $7.6 million, respectively. 73 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) 14. Commitments and contingenciesFrom time to time, the Company may become a party to, or be otherwise involved in various lawsuits, claims,investigations and other legal proceedings arising in the ordinary course of conducting its business. While litigation issubject to inherent uncertainties, management does not anticipate that any such matters will have a material adverse effect onthe Company’s financial condition, liquidity or results of operations.The Company is also currently subject to various pending and potential legal matters and investigations relating tocompliance with governmental laws and regulations, including import/export and environmental matters. For certain of thesematters it is not possible to determine the ultimate outcome, and the Company cannot reasonably estimate the maximumpotential exposure or the range of possible loss for such matters due primarily to being in the early stages of the relatedproceedings and investigations. The Company currently believes that the resolution of such matters will not have a materialadverse effect on the Company’s financial position or liquidity, but could possibly be material to its results of operations inany one reporting period. As of June 30, 2018 and July 1, 2017, the Company had aggregate estimated liabilities of $14.2 million, classifiedwithin accrued expenses and other for such compliance-related matters that were reasonably estimable as of such dates. 15. Earnings per share Years Ended June 30, July 1, July 2, 2018 2017 2016 (Thousands, except per share data) Numerator: Income (loss) from continuing operations $(142,889) $263,351 $390,909 Income (loss) from discontinued operations (13,535) 261,927 115,622 Net (loss) income $(156,424) $525,278 $506,531 Denominator: Weighted average common shares for basic earnings per share 119,909 127,032 130,858 Net effect of dilutive stock based compensation awards — 1,619 2,315 Weighted average common shares for diluted earnings per share 119,909 128,651 133,173 Basic earnings (loss) per share - continuing operations $(1.19) $2.07 $2.99 Basic earnings (loss) per share - discontinued operations (0.11) 2.06 0.88 Basic earnings (loss) per share $(1.30) $4.13 $3.87 Diluted earnings (loss) per share - continuing operations $(1.19) $2.05 $2.93 Diluted earnings (loss) per share - discontinued operations (0.11) 2.03 0.87 Diluted earnings (loss) per share $(1.30) $4.08 $3.80 Stock options excluded from earnings per share calculation due to anti-dilutive effect 1,495 1,038 378 For the fiscal year ended June 30, 2018, the diluted net loss per share is the same as the basis net loss per share as theeffect of 1,125,877 potential common shares would be anti-dilutive.74 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) 16. Additional cash flow informationThe “Other, net” component of non-cash and other reconciling items within operating activities in the consolidatedstatements of cash flows consisted of the following during the last three fiscal years: June 30, July 1, July 2, 2018 2017 2016 (Thousands) Provision for doubtful accounts receivable $6,033 $10,741 $7,776 Periodic pension cost 26,057 10,071 23,386 Other, net 17,293 8,292 (1,783) Total $49,383 $29,104 $29,379 Non-cash investing and financing activities and supplemental cash flow information were as follows: Years Ended June 30, July 1, July 2, 2018 2017 2016 (Thousands) Non-cash Investing Activities: Capital expenditures incurred but not paid $23,400 $6,490 $12,801 Non-cash Financing Activities: Unsettled share repurchases $3,425 $ — $ — Supplemental Cash Flow Information: Interest $99,929 $116,085 $112,557 Income taxes 113,130 404,497 48,093 The Company includes book overdrafts as part of accounts payable on its consolidated balance sheets and reflectschanges in such balances as part of cash flows from operating activities in its consolidated statements of cash flows. 17. Segment informationElectronic Components (“EC”) and Premier Farnell (“PF”) are the Company’s reportable segments (“operatinggroups”). EC markets and sells semiconductors and interconnect, passive and electromechanical devices and integratedcomponents to a diverse customer base serving many end-markets. PF was acquired in fiscal 2017 and distributes electroniccomponents and related products to the electronic system design community utilizing multi-channel sales and marketingresources.75 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) Years Ended June 30, July 1, July 2, 2018 2017 2016 (Millions) Sales: Electronic Components $17,543.6 $16,474.1 $16,740.6 Premier Farnell 1,493.3 965.9 — $19,036.9 $17,440.0 $16,740.6 Operating income (loss): Electronic Components $587.3 $661.0 $728.7 Premier Farnell 160.8 99.8 — 748.1 760.8 728.7 Corporate (99.2) (107.5) (101.2) Restructuring, integration and other expenses (145.1) (137.4) (44.8) Goodwill impairment (181.4) — — Amortization of acquired intangible assets and other (91.9) (54.5) (9.8) $230.5 $461.4 $572.9 Assets: Electronic Components $7,510.1 $7,126.0 $7,163.1 Premier Farnell 1,598.7 1,489.6 — Corporate 488.0 1,084.0 608.8 Discontinued operations — — 3,467.9 $9,596.8 $9,699.6 $11,239.8 Capital expenditures: Electronic Components $127.5 $81.6 $100.9 Premier Farnell 19.1 15.7 — Corporate 9.3 23.1 36.5 $155.9 $120.4 $137.4 Depreciation & amortization expense: Electronic Components $133.3 $64.4 $44.9 Premier Farnell 94.5 53.7 — Corporate 7.1 37.3 34.7 $234.9 $155.4 $79.6 Sales, by geographic area: Americas $5,011.4 $5,163.9 $4,801.3 EMEA 6,790.9 5,912.9 5,103.0 Asia/Pacific 7,234.6 6,363.2 6,836.3 $19,036.9 $17,440.0 $16,740.6 Property, plant and equipment, net, by geographic area: Americas $276.2 $296.1 $303.3 EMEA 204.8 186.1 129.6 Asia/Pacific 41.9 37.4 20.3 $522.9 $519.6 $453.2 (1)Corporate is not a reportable segment and represents certain centrally incurred overhead expenses and assets that are notincluded in the EC and PF measures of profitability or assets. Corporate amounts represent a reconciling item betweensegment measures of profitability and total Avnet amounts reported in the consolidated financial statements.76 (1)(1)(1)(1)(2)(3)(4)(5)(6) Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (2)Includes sales in the United States of $4.64 billion, $4.80 billion and $4.48 billion for fiscal 2018, 2017 and 2016,respectively.(3)Includes sales in Germany and Belgium of $2.66 billion and $1.08 billion, respectively, for fiscal 2018. Includes sales inGermany and Belgium of $2.29 billion and $930.3 million, respectively, for fiscal 2017. Includes sales in Germany andBelgium of $2.13 billion and $740.6 million, respectively, for fiscal 2016.(4)Includes sales of $2.71 billion, $2.63 billion and $949.5 million in Taiwan, China (including Hong Kong) andSingapore, respectively, for fiscal 2018. Includes sales of $2.18 billion, $2.45 billion and $928.4 million in Taiwan,China (including Hong Kong) and Singapore, respectively, for fiscal 2017. Includes sales of $2.86 billion, $2.44 billionand $903.0 million in Taiwan, China (including Hong Kong) and Singapore, respectively, for fiscal 2016.(5)Includes property, plant and equipment, net, of $271.4 million, $289.1 million and $297.1 million in the United Statesfor fiscal 2018, 2017 and 2016, respectively.(6)Includes property, plant and equipment, net, of $99.4 million, $52.5 million and $43.4 million in Germany, the UK andBelgium, respectively, for fiscal 2018. Fiscal 2017 includes property, plant and equipment, net, of $85.6 million, $52.1million and $39.8 million in Germany, the UK and Belgium, respectively. Fiscal 2016 includes property, plant andequipment, net, of $72.5 million in Germany and $40.0 million in Belgium.Listed in the table below are the Company’s major product categories and the related sales for each of the past threefiscal years: Years Ended June 30, July 1, July 2, 2018 2017 2016 (Millions) Semiconductors $14,890.9 $13,537.9 $13,978.0 Interconnect, passive & electromechanical (IP&E) 3,468.4 2,909.2 2,098.7 Computers 461.9 504.2 222.7 Other 215.7 488.7 441.2 $19,036.9 $17,440.0 $16,740.6 77 Table of ContentsAVNET, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) 18. Restructuring expensesFiscal 2018During fiscal 2018, the Company executed certain restructuring actions in an effort to integrate acquisitions and reducefuture operating expenses. Restructuring expenses are included as a component of restructuring, integration and otherexpenses in the Consolidated Statements of Operations. The activity related to the restructuring liabilities established duringfiscal 2018 is presented in the following table: Facility and Contract Asset Severance Exit Costs Impairments Other Total (Thousands) Fiscal 2018 restructuring expenses $56,812 $1,146 $2,496 $164 $60,618 Cash payments (32,513) (26) — (165) (32,704) Non-cash amounts — — (2,080) — (2,080) Other, principally foreign currency translation 176 3 — 1 180 Balance at June 30, 2018 $24,475 $1,123 $416 $ — $26,014 Severance expense recorded in fiscal 2018 related to the reduction, or planned reduction, of over 900 employees,primarily in executive management, operations, warehouse, sales and business support functions. Facility and contract exitcosts primarily consist of liabilities for remaining lease obligations for exited facilities and for contractual termination costs.Asset impairments relate to the impairment of property, plant and equipment as a result of the underlying restructuringactivities. Other restructuring costs related primarily to other miscellaneous restructuring and exit costs. Of the $60.6 millionin restructuring expenses recorded during fiscal 2018, $47.1 million related to EC, $10.6 million related to PF and $2.9million related to Corporate executive and business support functions. The Company expects the majority of the remainingamounts to be paid by the end of fiscal 2019.Fiscal 2017 and priorDuring fiscal 2017 and prior, the Company incurred restructuring expenses related to various restructuring actionsintended to reduce future operating expenses. The fiscal 2018 activity related to the restructuring liabilities from continuingoperations established during fiscal 2017 and prior is presented in the following table: Facility Severance Exit Costs Total (Thousands)Balance at July 1, 2017 $14,853 $2,142 $16,995Cash payments (12,327) (376) (12,703)Changes in estimates, net (1,313) (11) (1,324)Other, principally foreign currency translation 230 12 242Balance at June 30, 2018 $1,443 $1,767 $3,210As of June 30, 2018, management expects the majority of the remaining severance, and facility exit liabilities related tofiscal 2017 and prior restructuring actions to be paid by the end of fiscal 2019. 78 Table of Contents SCHEDULE IIAVNET, INC. AND SUBSIDIARIESVALUATION AND QUALIFYING ACCOUNTSYears Ended June 30, 2018, July 1, 2017, and July 2, 2016 Balance at Charged to Charged to Balance at Beginning of Expense Other End of Account Description Period (Income) Accounts Deductions Period (Thousands) Fiscal 2018 Allowance for doubtful accounts $47,272 $6,033 $ — $(4,346)(a)$48,959 Valuation allowance on tax loss carry-forwards 241,687 (4,704)(b) 2,500(c) — 239,483 Fiscal 2017 Allowance for doubtful accounts 27,448 10,741 14,361(d) (5,278)(a) 47,272 Valuation allowance on tax loss carry-forwards 63,694 4,477(e) 173,516(f) — 241,687 Fiscal 2016 Allowance for doubtful accounts 35,629 7,776 — (15,957)(a) 27,448 Valuation allowance on tax loss carry-forwards 60,834 (412)(g) 3,272(h) — 63,694 (a)Uncollectible receivables written off.(b)Primarily represents a reduction due to the release of a valuation allowance.(c)Primarily related to impact of current year activities and foreign currency exchange on valuation allowances previouslyestablished in various foreign jurisdictions.(d)Amount relates to increases to the allowance for doubtful accounts from acquisition and divestiture activity and suchamounts were not charged to other accounts.(e)Primarily related to an increase of $8.8 million due to the establishment of valuation allowances and a reduction of $4.0million due to a release in valuation allowances.(f)Primarily related to the acquisition of PF and other tax attributes recorded for which the Company does not expect torealize a benefit.(g)Represents a reduction primarily due to the release of a valuation allowance. (h)Primarily related to impact of foreign currency exchange rates on valuation allowances previously established in variousforeign jurisdictions.79 Table of Contents INDEX TO EXHIBITS ExhibitNumber Exhibit 2.1 Interest Purchase Agreement, dated as of September 19, 2016, by and among Avnet, Inc. and Tech Data Corporation(incorporated herein by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on September 20,2016). 2.2 First Amendment to Interest Purchase Agreement, dated as of February 27, 2017, by and between Avnet, Inc. and TechData Corporation (incorporated herein by reference to Exhibit 2.2 to the Company’s Current Report on Form 8-K filed onMarch 3, 2017). 3.1 Restated Certificate of Incorporation of the Company (incorporated herein by reference to Exhibit 3(i) to the Company’sCurrent Report on Form 8-K filed on February 12, 2001). 3.2 By-laws of the Company, effective May 9, 2014 (incorporated herein by reference to Exhibit 3.1 to the Company’s CurrentReport on Form 8-K filed on May 12, 2014). 4.1 Indenture dated as of March 5, 2004, by and between the Company and JP Morgan Trust Company, National Association(incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on March 8, 2004). 4.2 Officers’ Certificate dated September 12, 2006, establishing the terms of the 6.625% Notes due 2016 (incorporated hereinby reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on September 12, 2006). 4.3 Indenture dated as of June 22, 2010, between the Company and Wells Fargo Bank, National Association, as Trustee,providing for the issuance of Debt Securities in one or more series (incorporated herein by reference to Exhibit 4.1 to theCompany’s Current Report on Form 8-K filed on June 22, 2010). 4.4 Officers’ Certificate establishing the terms of the 5.875% Notes due 2020 (incorporated herein by reference to Exhibit 4.2 tothe Company’s Current Report on Form 8-K filed on June 22, 2010). 4.5 Form of Officers’ Certificate establishing the terms of the 4.875% Notes due 2022 (incorporated herein by reference toExhibit 4.1 to the Company’s Current Report on Form 8-K filed on November 21, 2012). 4.6 Form of Officers’ Certificate establishing the terms of the 4.625% Notes due 2026 (incorporated herein by reference toExhibit 4.1 to the Company’s Current Report on Form 8-K filed on March 22, 2016). 4.7 Form of Officers’ Certificate setting forth the terms of the 3.750% Notes due 2021 (incorporated herein by reference toExhibit 4.1 to the Company’s Current Report on Form 8-K filed on December 1, 2016). Note: The total amount of securities authorized under any other instrument that defines the rights of holders of theCompany’s long-term debt does not exceed 10% of the total assets of the Company and its subsidiaries on a consolidatedbasis. Therefore, these instruments are not required to be filed as exhibits to this Report. The Company agrees to furnishcopies of such instruments to the Commission upon request. Executive Compensation Plans and Arrangements 10.1 Form of Letter Agreement between the Company and William Amelio, Peter Bartolotta, and Michael O’Neill (incorporatedherein by reference to Exhibit 10.2 to the Company’s Annual Report on Form 10-K filed on August 17, 2017). 10.2 Form of Employment Agreement between the Company and MaryAnn Miller (incorporated herein by reference to Exhibit10.3 to the Company’s Annual Report on Form 10-K filed on August 9, 2013). 10.3 Employment Agreement between the Company and Kevin Moriarty (incorporated herein by reference to Exhibit 10.1 to theCompany’s Current Report on Form 8-K filed on September 3, 2013).80 Table of Contents 10.4 Form of Change of Control Agreement between the Company and William Amelio, MaryAnn Miller, Kevin Moriarty, PeterBartolotta and Michael O’Neill (incorporated herein by reference to Exhibit 10.3 to the Company’s Current Report on Form8-K filed on February 15, 2011). 10.5*Avnet, Inc. Deferred Compensation Plan for Outside Directors (Amended and Restated Effective as of May 8, 2018). 10.6 Avnet Supplemental Executive Officers’ Retirement Plan (2013 Restatement) (incorporated herein by reference to Exhibit10.13 to the Company’s Annual Report on Form 10-K filed on August 9, 2013). 10.7 Avnet Restoration Plan (2013 Restatement) (incorporated herein by reference to Exhibit 10.14 to the Company’s AnnualReport on Form 10-K filed on August 9, 2013). 10.8*Avnet, Inc. 2010 Stock Compensation Plan (Amended and Restated Effective as of May 8, 2018). 10.9 Avnet, Inc. 2010 Stock Compensation Plan:(a) Form of non-qualified stock option term sheet(b) Form of incentive stock option term sheet(c) Form of performance stock unit term sheet(d) Form of restricted stock unit term sheet (incorporated herein by reference to Exhibit 10.1 to the Company’s CurrentReport on Form 8-K filed on August 10, 2012). 10.10*Avnet, Inc. 2013 Stock Compensation and Incentive Plan (Amended and Restated Effective as of May 8, 2018). 10.11 Avnet, Inc. 2013 Stock Compensation and Incentive Plan:(a) Form of restricted stock unit term sheet(b) Form of nonqualified stock option term sheet(c) Form of performance-based stock option term sheet(d) Form of performance stock unit term sheet(incorporated herein by reference to Exhibit 10.15 to the Company’s Annual Report on Form 10-K filed on August 17,2017). 10.12*Avnet, Inc. 2016 Stock Compensation and Incentive Plan (Amended and Restated Effective as of May 8, 2018). Refer toExhibit 10.11, above, for the form of awards under the 2016 Stock Compensation and Incentive Plan. 10.13*Avnet Deferred Compensation Plan (Amended and Restated Effective as of May 8, 2018). 10.14 Form of Indemnity Agreement between the Company and its directors and officers (incorporated herein by reference toExhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on May 8, 2006). Bank Agreements 10.15 Securitization Program (a) Amended and Restated Receivables Sale Agreement, dated February 27, 2017, between Avnet, Inc. and AvnetReceivables Corporation (incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-Kfiled on March 3, 2017). (b) Third Amended and Restated Receivables Purchase Agreement, dated February 27, 2017, among Avnet, Inc., AvnetReceivables Corporation, the companies and financial institutions party thereto and JPMorgan Chase Bank, N.A., as agent(incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on March 3, 2017). 10.16 (a) Credit Agreement dated as of July 9, 2014, among Avnet, Inc., each subsidiary of the Company party thereto, Bank ofAmerica, N.A., as administrative agent, and each lender party thereto (incorporated herein by reference to Exhibit 10.1 to theCompany’s Current Report on Form 8-K filed on July 10, 2014). 81 Table of Contents (b) Amendment No. 1 to Credit Agreement, dated as of September 14, 2016, between Avnet, Inc., each subsidiary of theCompany party thereto, Bank of America, N.A., as administrative agent , and each lender party thereto (incorporated hereinby reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on September 15, 2016). 10.17 (a) Senior Unsecured Bridge Credit Agreement, dated as of July 27, 2016, between Avnet, Inc., the lenders party thereto andBank of America N.A., as administrative agent (incorporated herein by reference to Exhibit 10.1 to the Company’s CurrentReport on Form 8-K filed on July 28, 2016). (b) Amendment No. 1 to Senior Unsecured Bridge Credit Agreement, dated as of September 13, 2016, between Avnet, Inc.,the lenders party thereto and Bank of America N.A., as administrative agent (incorporated herein by reference to Exhibit10.2 to the Company’s Current Report on Form 8-K filed on September 15, 2016). (c) Amendment No. 2 and Waiver to Senior Unsecured Bridge Credit Agreement, dated as of October 24, 2016, betweenAvnet, Inc., the lenders party thereto and Bank of America N.A., as administrative agent (incorporated herein by reference toExhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 24, 2016). 10.18 Senior Unsecured Term Loan Credit Agreement, dated as of September 14, 2016, between Avnet, Inc., Avnet HoldingEurope BVBA, Tenva Group Holdings Limited, the lenders party thereto and Bank of America N.A., as administrativeagent (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on September15, 2016). 10.19 Restated and Amended Credit Agreement dated as of June 28, 2018 among Avnet, Inc., each subsidiary of the Companyparty thereto, Bank of America, N.A., as administrative agent, and each lender party thereto (incorporated herein byreference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on July 2, 2018). 12.1*Ratio of Earnings to Fixed Charges. 21*List of subsidiaries of the Company as of June 30, 2018. 23.1*Consent of KPMG LLP. 24.1*Power of Attorney (incorporated by reference to the signature page of this Annual Report on Form 10-K). 31.1*Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2*Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1**Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2**Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 101.INS*XBRL Instance Document. 101.SCH*XBRL Taxonomy Extension Schema Document. 101.CAL*XBRL Taxonomy Extension Calculation Linkbase Document. 101.LAB*XBRL Taxonomy Extension Label Linkbase Document. 101.PRE*XBRL Taxonomy Extension Presentation Linkbase Document. 101.DEF*XBRL Taxonomy Extension Definition Linkbase Document. *Filed herewith. **Furnished herewith. 82 Exhibit 10.10AVNET, INC.2013 STOCK COMPENSATION AND INCENTIVE PLAN (As Amended and Restated Effective as of May 8, 2018)ARTICLE 1PURPOSE OF THE PLAN The Avnet, Inc. 2013 Stock Compensation and Incentive Plan, as amended and restated, is intended toadvance the interests of the Company by helping Avnet and its Subsidiaries to attract, retain, andappropriately motivate high caliber persons to serve as Eligible Employees and Non-Employee Directors,and by providing incentives to Eligible Employees and Non-Employee Directors that are consistent withthe shareholders’ interest in maximizing the value of Avnet’s Stock.ARTICLE 2DEFINITIONS The following terms, when used in capitalized form, shall have the meanings set forth below: 2.1 “Administrator” means—(a) with respect to each Award granted to an Eligible Employee, the Committee; and(b) with respect to each Award granted to a Non-Employee Director, the Independent Directors.2.2. “Agreement” means the document that evidences an Award granted hereunder and sets forth thematerial terms thereof, including any addendum to an Option Agreement relating to Stock AppreciationRights. Each Agreement shall be in such form as prescribed or approved by the Administrator.2.3. “Avnet” means Avnet, Inc.2.4. “Award” means a grant under the Plan of an Option, Stock Appreciation Right, Restricted Stock,Restricted Stock Unit, Performance Share Unit, Other Stock Unit Award, or Executive IncentivePerformance Award, as evidenced by an Agreement.2.5. “Board of Directors” and “Director” shall mean, respectively, the Board of Directors of Avnet andany member thereof.2.6. “Change in Control” means the happening of any of the following:(a) the acquisition, by any individual, entity or group (within the meaning of Section 13(d)(3) or14(d)(2) of the Exchange Act (a “Person”)), of beneficial ownership (within the meaning of Rule 13d-3)of 50% or more of either (A) the then outstanding shares of Stock or (B) the combined voting power ofthe then outstanding voting securities of Avnet entitled to vote generally in the election of Directors;provided, however, that none of the following acquisitions shall constitute a Change in Control underthis subsection (a): (i) an acquisition directly from Avnet (excluding an acquisition by virtue of theexercise of a conversion privilege), (ii) an acquisition by Avnet or an entity controlled by Avnet, or (iii)an acquisition by any employee benefit plan (or related trust) sponsored or maintained by Avnet or anyentity controlled by Avnet; or(b) individuals who, as of the date of the 2013 annual meeting of Avnet’s stockholders (the“Determination Date”), constitute the Board of Directors (the “Incumbent Board”) cease for any reasonto constitute at least a majority of the Board of Directors; provided, however, that an individual whobecomes a Director after the Determination Date shall be treated as a member of the Incumbent Board if(i) his election, or nomination for election by Avnet’s stockholders, was approved by a vote of at least amajority of the Directors then comprising the Incumbent Board, and (ii) his initial assumption of officedoes not occur as a result of an actual or threatened solicitation of proxies or consents by or on behalf ofa Person other than the Board; or(c) a complete liquidation or dissolution of Avnet or the sale or other disposition of all orsubstantially all of the assets of Avnet; provided, however, that a liquidation, dissolution, sale, or otherdisposition shall not constitute a Change in Control if the assets are transferred to a wholly ownedsubsidiary of Avnet.2.7. “CEO” means the Chief Executive Officer of Avnet.2.8. “Code” means the Internal Revenue Code of 1986, as amended.2.9. “Committee” means the Compensation Committee of the Board of Directors, which shall consist ofthree or more Non-Employee Directors appointed by the Board of Directors. No individual who is not botha “non-employee director” within the meaning of Rule 16b-3 and an “outside director” within the meaningof Section 162(m) of the Code shall serve as a member of the Committee.2.10. “Company” means Avnet and all its Subsidiaries.2.11. “Covered Participant” means a Participant who is a “covered employee” under Section 162(m) ofthe Code.2.12. “Eligible Employee” means an employee of Avnet or of any of its Subsidiaries. The term “EligibleEmployee” shall also include an individual retained by Avnet or any of its Subsidiaries to render servicesas a consultant or advisor other than services in connection with the offer or sale of securities in a capital-raising transaction or services that directly or indirectly promote or maintain a market for Avnet’ssecurities.2.13. “Exchange Act” means the Securities Exchange Act of 1934, as amended.2.14. “Executive Incentive Performance Award” or “EIP Award” means a performance-based cashaward granted pursuant to Article 11.2.15. “Executive Officer” means an employee designated by Avnet as an executive officer under Rule16b-3.2.16. “Fair Market Value” means, with respect to any date, the closing price (as reported for the NasdaqComposite Index) at which shares of Stock have been sold on such date (or, if such date is a date for whichno trading is so reported, on the next preceding date for which trading is so reported).2.17. “Grant Date” means, with respect to granting an Award or modification of an outstanding Award,the date on which the material terms of the Award (including the number of shares covered by the Award,the conditions for vesting, lapse of the Period of Restriction, and exercise, and the purchase price, if any)are established and all action constituting the making or modification of such Award is completed, withoutregard to (a) the date on which the applicable Agreement is executed or (b) whether such Award ormodification is subject to future shareholder approval or other conditions. The Grant Date for any Awardshall not occur before the recipient of the Award becomes an Eligible Employee or Non-EmployeeDirector, as applicable.2.18. “Incentive Stock Option” or “ISO” means an Option intended to qualify as an “incentive stock option” under Section 422 of the Code.2.19. “Independent Directors” means members of the Board of Directors acting as a group, each ofwhom satisfies Avnet’s “Director Independence Standards.”2.20. “Non-Employee Director” means a Director who is not an Eligible Employee.2.21. “Option” means an Award granted pursuant to Article 5 that gives the recipient the right topurchase a specified number of shares at a specified price during a specified term, subject to the terms andconditions of the applicable Agreement.2.22. “Optionee” means a person who, at the time in question, holds an Option that then remainsunexercised in whole or in part, has not been surrendered, and has not expired or terminated. The term“Optionee” also includes any Successor Optionee.2.23. “Other Stock Unit Award” means an Award granted pursuant to Article 10.2.24. “Participant” means an Eligible Employee or Non-Employee Director who has been granted anAward hereunder.2.25. “Performance Criteria” means any of the following criteria as related to Avnet, any Subsidiary, orany division or other area of Avnet or a Subsidiary:(i) Economic profit; economic value added; price of Stock; total stockholder return; revenues; sales;sales productivity; sales growth; net income; operating income; earnings per share; return on equity;return on investment; return on capital employed; cash flow; operating margin; gross margin; operatingunit contribution; achievement of annual operating profit plans; debt level; market share; net worth; orother similar financial performance measures as may be determined by the Committee; or(ii) Strategic business criteria consisting of one or more objectives based on meeting specified marketpenetration or market share; geographic business expansion; objective customer satisfaction goals;objective goals relating to divestitures, joint ventures, mergers, acquisitions, and similar transactions;implementation or completion of specified projects or processes strategic or critical to the Company’sbusiness operations; individual business objectives; objective measures of brand recognition/acceptance;performance achievements on designated projects or objectives; objective measures of regulatorycompliance; successful completion of internal or external audits; successful integration of business units;successful hiring, retention of talent, or other succession planning; or objective measures of employeeengagement and satisfaction.In addition, for any Participant who is not a Covered Participant, Performance Criteria may include anyother criteria selected by the Committee.2.26. “Performance Objectives” means, for any Award that is contingent in whole or in part onachievement of performance objectives, the objectives or other performance levels with respect to specifiedPerformance Criteria that are measured over a Performance Period for the purpose of determining theamount of such Award and/or whether such Award is granted or vested.2.27. “Performance Period” means a period over which achievement of Performance Objectives ismeasured, as set forth in the applicable Agreement.2.28. “Performance Share Unit” means an Award granted pursuant to Article 9 that gives the recipient acontractual right to receive a target number of shares of Stock or cash upon the attainment of specified Performance Objectives.2.29. “Period of Restriction” means the period during which the transfer of shares of Restricted Stock isrestricted, pursuant to Article 7.2.30. “Person” means “person” as defined in Section 3(a)(9) of the Exchange Act and as used inSections 13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) of the Exchange Act, butexcluding Avnet, any Subsidiary, and any employee benefit plan sponsored or maintained by Avnet or anySubsidiary (including any trustee of such plan acting as trustee).2.31. “Plan” means the Avnet, Inc. 2013 Stock Compensation and Incentive Plan, as set forth herein andas amended from time to time.2.32. “Restricted Stock” means an Award of Stock granted pursuant to Article 7.2.33. “Restricted Stock Unit” means an Award granted pursuant to Article 8 that gives the recipient acontractual right to receive cash or shares of Stock upon the attainment of specified vesting conditions.2.34. “Rule 16b-3” means SEC Rule 16b-3 promulgated under the Exchange Act.2.35. “Securities Act” means the Securities Act of 1933, as amended.2.36. “Stock” means, subject to the adjustment provisions set forth in Article 13, Avnet’s $1.00 parvalue common stock.2.37. “Stock Appreciation Right” or “SAR” means an Award granted pursuant to Article 6 that gives therecipient the right to receive, upon exercise of the Award, an amount equal to the excess of the Fair MarketValue of the shares of Stock with respect to which the SAR is being exercised (determined as of theexercise date) over the exercise price set forth in the Agreement.2.38. “Subsidiary” means a corporation in which Avnet directly or indirectly owns more than 50% ofthe total combined voting power of all classes of capital stock.2.39. “Successor Optionee” means any person who, under the provisions of Article 5, has acquired froman Optionee the right to exercise an Option, for so long as such Option remains unexercised in whole or inpart, and has not been surrendered, exercised, or terminated.ARTICLE 3SHARES RESERVED FOR THE PLAN 3.1. General Limitations. Subject to the adjustment provisions set forth in Article 13, the maximumnumber of shares of Stock that may be delivered pursuant to the exercise of Awards granted under the Planshall be 5,000,000. At no time shall there be outstanding Awards under the Plan covering more than suchmaximum number of shares less the aggregate of the shares of Stock previously delivered pursuant to theexercise of Options (including the shares of Stock previously covered by Options surrendered inconnection with the exercise of SARs), the shares of Stock with respect to which stock-settled SARs havebeen exercised (without regard to the number of shares of Stock issued upon settlement of such SARs), andthe shares of Stock previously delivered pursuant to the vesting of Restricted Stock, Restricted Stock Units,Performance Share Units, and Other Stock Unit Awards. The shares of Stock authorized hereunder shall bein addition to the shares of Stock authorized for grant under the 2010 Avnet, Inc. Stock Compensation Plan(the “2010 Plan”), which shall continue to be available for grant under the 2010 Plan. Shares of Stocksubject to Awards may consist of authorized but unissued shares of Stock and/or shares of Stock held inAvnet’s treasury. 3.2. Individual Limitations. No individual may be granted (a) Options or SARs for more than 500,000shares of Stock in any calendar year or (b) Awards in any calendar year for more than 1,000,000 shares inthe aggregate (including Options, SARs, and full-value awards). In addition, no Non-Employee Directormay be granted Awards for more than 30,000 shares of Stock, or a value of more than $1 million at thetime of grant, in any calendar year; provided, however, that up to 60,000 shares of Stock (or a value up to$2 million) may be subject to Awards granted to a Non-Employee Director during the calendar year inwhich the Non-Employee Director first joins the Board of Directors or is first designated as Chairman of theBoard of Directors or Lead Director.3.3. Termination and Expiration of Awards. If an Award is surrendered, terminates, or expires, whetherin whole or in part, the number of shares of Stock covered by such Award immediately before suchsurrender, termination, or expiration shall thereupon be added back to the number of shares of Stockotherwise available for further grants of Awards hereunder; provided, however, that the followingtransactions involving shares of Stock shall not result in shares of Stock becoming available for subsequentAwards: (a) Stock tendered or withheld in payment of the exercise price of an Option; (b) Stock tendered orwithheld for taxes; (c) Stock that was subject to a stock-settled SAR or an Option that was related to a SARand was not issued upon the settlement or exercise of such SAR; and (d) Stock repurchased by theCompany with the proceeds of an Option exercise.ARTICLE 4ADMINISTRATION OF THE PLAN 4.1. Plan Administration. This Plan shall be administered by the Administrator. The Administrator shallhave full and exclusive power to: (a) construe and interpret the Plan; (b) establish and amend rules andregulations for the administration of the Plan; (c) correct any defect, remedy any omission, and reconcileany ambiguity or inconsistency in the Plan or any Award in the manner and to the extent it deemsnecessary or desirable to carry out the intent of the Plan and such Award; and (d) certify the level as towhich each Performance Objective was attained. Subject to Section 4.6, the Administrator may delegatesome or all of its authority under the Plan (including powers not referenced in this Section 4.1) to one ormore Company officers, to the extent permitted by and not inconsistent with any requirements ofapplicable law.4.2. Committee’s Authority to Grant Awards. In addition to the powers enumerated in Section 4.1 (andwithout limiting the generality thereof), the Committee shall have plenary authority and discretion todetermine the time or times at which Awards shall be granted to Eligible Employees, the EligibleEmployees to whom Awards shall be granted, the number of shares of Stock (or for Awards denominatedin cash, the dollar amount) to be covered by each such Award, and the terms and conditions upon whicheach such Award may be exercised (in each case, to the extent not inconsistent with the provisions of thisPlan). Subject to the requirements of the Plan, the terms and conditions prescribed or approved for anyAward granted by the Committee (as reflected in the applicable Agreement) shall be entirely within thediscretion of the Committee.4.3. Independent Directors’ Authority to Grant Awards. In addition to the powers enumerated in Section4.1 (and without limiting the generality thereof), the Independent Directors shall have plenary authority anddiscretion to determine the time or times at which Awards shall be granted to Non-Employee Directors, theNon-Employee Directors to whom Awards shall be granted, the number of shares of Stock (or for Awardsdenominated in cash, the dollar amount) to be covered by each such Award, and the terms and conditionsupon which each such Award may be exercised (in each case, to the extent not inconsistent with theprovisions of this Plan); provided that (a) no Director shall participate in any action taken with respect to anAward granted or to be granted to such Director, unless the same action is contemplated for all similarlysituated Directors, and (b) no Award shall be granted to a Non-Employee Director unless such grant isapproved by a majority of the Non-Employee Directors. Subject to the requirements of the Plan, the termsand conditions prescribed or approved for any Award granted by the Independent Directors (as reflected inthe applicable Agreement) shall be entirely within the discretion of the Independent Directors. 4.4. Actions of the Committee. A majority of the members of the Committee (but not less than two) shallconstitute a quorum, and all acts, decisions or determinations of the Committee shall be by majority vote ofsuch of its members as shall be present at a meeting duly held at which a quorum is so present. Any act,decision, or determination of the Committee reduced to writing and signed by a majority of its members(but not less than two) shall be fully effective as if it had been made, taken or done by vote of suchmajority at a meeting duly called and held.4.5. Reporting. The Committee shall file reports and make information available as may from time totime be prescribed by the Board of Directors.4.6. CEO Authority to Grant Awards. The CEO shall have authority to make Awards to EligibleEmployees who are not Executive Officers or Covered Participants, including Eligible Employees who arepromoted to Executive Officer positions; provided that, except to the extent that the Committee delegatesadditional authority, the Awards granted by the CEO in any fiscal year shall not have an aggregate value ofmore than $500,000 (where value for each Award is determined on the Grant Date). The Committee maydelegate to the CEO the authority to make additional Awards (in excess of the limit set forth in theimmediately preceding sentence); provided that (a) the additional Awards shall be subject to a maximumaggregate Award amount, and (b) only the Committee shall be authorized to grant awards to ExecutiveOfficers and Covered Participants. The CEO shall have plenary authority and discretion to determine thetime or times at which Awards that the CEO is authorized to grant shall be granted, the Eligible Employeesto whom such Awards shall be granted, the number of shares of Stock (or for Awards denominated in cash,the dollar amount) to be covered by each such Award (subject to the maximum aggregate and individuallimitations described above), and the terms and conditions upon which each such Award may be exercised(in each case, to the extent not inconsistent with the provisions of this Plan).4.7. Determining Amount Payable. With respect to any Award that is conditioned in whole or in part onthe achievement of Performance Objectives, the Administrator shall determine the extent to which theapplicable Performance Objectives were achieved and shall have discretion to reduce the amount thatbecomes vested or payable upon achievement of such Performance Objectives.4.8. Decisions of the Administrator. All determinations and decisions made by the Administratorpursuant to the provisions of the Plan shall be final, conclusive, and binding upon all Persons and theCompany, except to the extent that the terms of any sale or award of shares of Stock or any grant of rightsor Options under the Plan are required by law or by the Articles of Incorporation or By-laws of Avnet to beapproved by the Board of Directors or shareholders.4.9. Law Compliance. Notwithstanding any other provision of the Plan, the Administrator may imposesuch conditions on any Award, and the Board may amend the Plan in any such respects, as theAdministrator or the Board determines is necessary or desirable to avoid adverse consequences under Rule16b-3, Section 162(m) of the Code, Section 409A of the Code, Section 280G of the Code, or any otherapplicable law.ARTICLE 5OPTIONS 5.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant Options toEligible Employees, and the Independent Directors may grant Options to Non-Employee Directors.5.2. Exercise Price. The price per share at which Stock subject to an Option may be purchased shall beset forth in the Agreement. In no event shall such exercise price be less than 100% of the Fair MarketValue of the Stock on the Grant Date.5.3. Term. The term of each Option granted under the Plan shall be set forth in the Agreement; provided,however, that in no event shall an Option be exercisable after the day before the tenth anniversary of the Grant Date. Unless sooner forfeited or otherwise terminated pursuant to the terms hereof or of theAgreement, each Option granted under the Plan shall expire at the end of its term, and the term may not beextended. No Option may be exercised after the expiration of its term.5.4. Exercisability (Vesting). Each Option granted under the Plan shall be subject to the vestingconditions set forth in the Agreement; provided, however, that the exercisability of any Option may beaccelerated in whole or in part, at any time, by the Administrator (or its designee). Subject to the provisionsof the Agreement, each Option granted under the Plan that has become exercisable pursuant to thepreceding sentence shall remain exercisable thereafter until the expiration of its term as described inSection 5.3.5.5. Exercise. To the extent that an Option has become exercisable in accordance with Section 5.4, suchOption may be exercised by notice to Avnet, in a form approved by Avnet, stating the number of shares ofStock with respect to which such Award is being exercised, accompanied by payment in full therefor asdescribed below. After receipt of such notice and payment, subject to Section 12.6 (Registration of Shares),Avnet shall record the stock transfer on its book and records without the need to issue a physical certificate.The payment due upon exercise of an Option may be made in any form permitted by the Administrator.The permitted forms of payment may (but are not required to) include (i) check (certified, if so required byAvnet); (ii) shares of Stock with a fair market value, at the date of receipt by Avnet, equal to the aggregateexercise price (plus withholding, if applicable); (iii) a combination of check and shares of Stock; (iv)having Avnet retain from the Stock otherwise issuable upon exercise of the Option a number of shares ofStock having a fair market value equal to the exercise price of the Option (plus withholding, if applicable);(v) to the extent permitted by applicable law, by delivering a properly executed exercise notice, togetherwith irrevocable instructions to a broker to promptly deliver to Avnet the exercise price and to deliver tothe Participant the net amount of shares received upon exercise (after subtracting the exercise price,withholding, and any broker fee); or (vi) any other manner acceptable to the Administrator.5.6. General Modification Rules. The Administrator may, for such consideration (if any) as it may deemadequate and with the prior consent of the Optionee, modify the terms of any outstanding Option;provided, however, that except to the extent permitted by Section 5.7, no Option may be repriced,replaced, or regranted through cancellation, or by lowering the exercise price of such Option, and noOption with an exercise price that exceeds the Fair Market Value of a share of Stock shall be exchanged fora cash payment, without shareholder approval.5.7. Special Modification in the Event of a Corporate Transaction. In the event of a corporatetransaction (within the meaning of Treas. Reg. § 1.424-1(a)(3)), the Administrator may provide for theassumption or substitution of outstanding Options, provided that the requirements of Treas. Reg. § 1.424-1(a) are satisfied with respect to Incentive Stock Options, and the requirements of Treas. Reg. § 1.409A-1(b)(v)(D) are satisfied with respect to all other Options.5.8. Special Rules for Incentive Stock Options (“ISOs”). ISOs shall be subject to the requirements ofSection 422 of the Code, including the following (all of which shall be interpreted consistent with the intentto comply with the requirements of Section 422 of the Code and not to impose any restrictions that are notrequired by Section 422):(a) Shares Available for ISO Grants. All shares of Stock authorized for Awards under Article 3 areavailable to be issued through ISOs; provided, however, that to the extent required by Section 422 of theCode, canceled Awards shall continue to be counted against the number of shares available.(b) Optionee Must Be an Employee. No ISO shall be granted to any individual who is not anemployee of Avnet or a Subsidiary at the time of grant.(c) Special Rules for 10% Owners. An Incentive Stock Option shall not be granted to an individualwho, immediately before the time the Option is granted, owns shares of Stock possessing more than 10 percent of the total combined voting power of all classes of stock of Avnet, unless the Agreement forsuch Incentive Stock Option provides that (i) the exercise price is no less than 110 percent (110%) of theFair Market Value of the Stock on the Grant Date (determined in accordance with Treas. Reg. § 1.422-2(f)(1)), and (ii) the Option expires no later than the fifth anniversary of the Grant Date.ARTICLE 6STOCK APPRECIATION RIGHTS (“SARs”) 6.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant SARs toEligible Employees, and the Independent Directors may grant SARs to Non-Employee Directors. Each SARmay be free-standing or related to all or part of an Option. In the discretion of the Administrator, a SARrelated to an Option may be granted at any time before the related Option is exercised, expires, isterminated, or is surrendered, and may be modified when the related Option is modified.6.2. Exercise Price. The exercise price per share for each free-standing SAR granted under the Plan shallbe set forth in the Agreement. In no event shall the exercise price be less than 100% of the Fair MarketValue of the Stock on the Grant Date.6.3. Term. The term of each SAR granted under the Plan shall be set forth in the Agreement; provided,however that in no event shall a SAR be exercisable after the day before the tenth anniversary of the GrantDate. Unless sooner forfeited or otherwise terminated pursuant to the terms hereof or of the Agreement,each SAR granted under the Plan shall expire at the end of its term, and the term may not be extended. NoSAR may be exercised after the expiration of its term.6.4. Exercisability (Vesting). Each SAR granted under the Plan shall be subject to the vesting conditionsset forth in the Agreement; provided, however, that (a) the exercisability of any SAR may be accelerated inwhole or in part, at any time, by the Administrator (or its designee), and (b) if a SAR relates to all or part ofan Option, such SAR shall be exercisable only to the extent that the related Option is exercisable. Subject tothe provisions of the Agreement, each SAR that is exercisable pursuant to the preceding sentence shallremain exercisable thereafter until the expiration of its term as described in Section 6.3.6.5. Exercise. To the extent that a SAR has become exercisable in accordance with Section 6.4, suchSAR may be exercised in accordance with the procedures set forth in Section 5.5 (Exercise), but withoutthe requirement to make a payment therefor. If the SAR is related to all or part of an Option, the Optioneemust provide with the exercise notice an instrument effecting the surrender of the related portion of theOption. Each SAR may be settled in shares of Stock, cash, or a combination of cash and shares (providedthat shares of Stock underlying any SAR that is settled in cash shall not be available to be issued in a futureAward). No fractional shares shall be issued; any amount that would have been payable in fractional sharesshall be paid in cash.6.6. Other Conditions. The Administrator (or its designee) may impose any other conditions upon theexercise of SARs. Such conditions may govern the right to exercise SARs granted before the adoption oramendment of such conditions as well as SARs granted thereafter.6.7. Modification Rules. The modification rules and restrictions set forth in Sections 5.6 (GeneralModification Rules) and 5.7 (Special Modification in the Event of a Corporate Transaction) shall also applywith respect to SARs.ARTICLE 7RESTRICTED STOCK 7.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant RestrictedStock to Eligible Employees, and the Independent Directors may grant Restricted Stock to Non-Employee Directors. The number of shares granted pursuant to any Restricted Stock Award shall be set forth in theAgreement.7.2. Restrictions. During the Period of Restriction set forth in the applicable Agreement, shares ofRestricted Stock shall not be sold, transferred, pledged, assigned, exchanged, encumbered, alienated,hypothecated, or otherwise disposed of. Except as otherwise provided in the Agreement, if a Participant‘semployment or other service with the Company terminates before the end of the Period of Restriction forany shares of Restricted Stock, all such restricted shares shall be forfeited, and all rights of the Participantwith respect to such shares of Stock shall immediately terminate without any payment or otherconsideration therefor. Any forfeited shares of Restricted Stock that had been delivered to, or held incustody for, a Participant shall be returned to Avnet, accompanied by any instrument of transfer requestedby Avnet.7.3. Lapse of Period of Restriction (Vesting). The Period of Restriction for each Award of RestrictedStock shall lapse only upon satisfaction of conditions set forth in the Agreement. Such conditions may bebased on (a) continued service to Avnet or a Subsidiary for a specified period, (b) achievement ofPerformance Objectives, or (c) a combination of (a) and (b). Except as provided in Section 12.2(Acceleration of Vesting), the Period of Restriction for any Award of Restricted Stock that is notconditioned on achievement of Performance Objectives shall lapse no faster than pro rata over the three (3)year period that starts on the Grant Date.7.4. Settlement of Restricted Stock. Shares of Restricted Stock shall become freely transferableimmediately following the last day of the Period of Restriction. As soon as practicable after the Period ofRestriction lapses, Avnet shall record the stock transfer on its book and records without the need to issue aphysical certificate.7.5. Voting Rights. During the Period of Restriction, Participants in whose name Restricted Stock isgranted under the Plan may exercise full voting rights with respect to those shares.7.6. Dividend Rights. During the Period of Restriction, Participants in whose name Restricted Stock isgranted shall be entitled to receive all dividends and other distributions paid with respect to such RestrictedStock Awards, as set forth in this Section 7.6. Dividends paid in cash shall be automatically reinvested inadditional shares of Restricted Stock at a purchase price per share equal to the Fair Market Value of a shareof Stock on the date such dividend is paid; provided, however, that fractional shares shall not be issued.Any amount that would have been invested in a fractional share shall be payable to the Participant in cashwhen the Period of Restriction for the underlying shares lapses. All additional shares of Stock received by aParticipant in respect of a dividend or other distribution on Restricted Stock, whether through reinvestmentor through a dividend or other distribution paid in shares of Stock, shall be subject to the same restrictions(for the same Period of Restriction) as the Restricted Stock with respect to which they were received; andthe right to receive cash with respect to any fractional share shall be subject to forfeiture until the Period ofRestriction for the underlying shares lapses.7.7. Foreign Laws. Notwithstanding any other provision of the Plan, if Restricted Stock is to be awardedto a Participant who is subject to the laws, including the tax laws, of any country other than the UnitedStates, the Committee may, in its discretion, direct Avnet to sell, assign, or otherwise transfer the RestrictedStock to a trust or other entity or arrangement, rather than grant the Restricted Stock directly to theParticipant.ARTICLE 8RESTRICTED STOCK UNITS 8.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant RestrictedStock Units to Eligible Employees, and the Independent Directors may grant Restricted Stock Units to Non-Employee Directors. The number of shares of Stock underlying any Restricted Stock Unit Award shall beset forth in the Agreement. 8.2. Vesting. An Award of Restricted Stock Units shall be subject to vesting conditions set forth in theapplicable Agreement. Such vesting conditions may be based on (a) continued service to Avnet or aSubsidiary for a specified period, (b) achievement of Performance Objectives, or (c) a combination of (a)and (b). Except as provided in Section 12.2 (Acceleration of Vesting), if vesting of a Restricted Stock UnitAward is not conditioned on achievement of Performance Objectives, the Award shall become vested nofaster than pro rata over the three (3) year period that starts on the Grant Date.8.3. Settlement of Restricted Stock Units. Subject to Section 12.6 (Registration of Shares), as soon aspracticable after any Restricted Stock Unit becomes vested, Avnet shall transfer to the Participant one shareof Stock for each such vested Restricted Stock Unit, cash in lieu of shares of Stock, or a combination ofcash and shares of Stock. No fractional shares shall be issued with respect to vesting of Restricted StockUnits.8.4. Dividend Rights. Participants in whose name Restricted Stock Units are granted shall not be entitledto receive dividends or other distributions with respect to shares of Stock underlying such Restricted StockUnit, unless the Agreement provides otherwise. Any right to receive dividends or other distributions shallbe subject to the same vesting conditions and risk of forfeiture as the Restricted Stock Units with respect towhich such right is granted, and all dividends and distributions shall be paid when the applicable RestrictedStock Units are settled.ARTICLE 9PERFORMANCE SHARE UNITS 9.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant PerformanceShare Units to Eligible Employees, and the Independent Directors may grant Performance Share Units toNon-Employee Directors. The target and maximum number of Shares deliverable upon achievement of theapplicable Performance Objectives shall be set forth in the Agreement.9.2. Vesting. Vesting of Performance Share Units shall be conditioned upon the achievement of specifiedPerformance Objectives over a specified Performance Period, and such other conditions as are set forth inthe Agreement.9.3. Settlement of Performance Shares. After Performance Share Units become vested, Avnet shalltransfer to the Participant shares of Stock or cash, or a combination of cash and shares of Stock,corresponding to the vested amount (determined after taking into account the Administrator’s discretion toreduce the amount payable upon achievement of Performance Objectives). No fractional shares shall beissued with respect to vesting of Performance Share Units.9.4. Dividend Rights. Participants in whose name Performance Share Units are granted shall not beentitled to receive dividends or other distributions with respect to shares of Stock underlying suchPerformance Share Units, unless the Agreement provides otherwise. Any right to receive dividends or otherdistributions shall be subject to the same vesting conditions and risk of forfeiture as the Performance ShareUnits with respect to which such right is granted, and all dividends and distributions shall be paid when theapplicable Performance Share Units are settled.ARTICLE 10 OTHER STOCK UNIT AWARDS 10.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant Other StockUnit Awards to Eligible Employees, and the Independent Directors may grant Other Stock Unit Awards toNon-Employee Directors. Each Other Stock Unit Award may be granted as a stand-alone Award or inconnection with another Award made under the Plan, and may be in the form of Stock or other securities.The number of shares of Stock or other securities underlying any Other Stock Unit Award shall be set forthin the Agreement. 10.2. Amount of Award. The value of each Other Stock Unit Award shall be based, in whole or in part,on the value of the underlying Stock or other securities. The Agreement may provide that an Other StockUnit Award may provide to the Participant (a) dividends or dividend equivalents and (b) cash payments inlieu of or in addition to an Award.10.3. General Rules for Other Stock Unit Awards. Subject to the requirements of the Plan, including thisSection 10.3, the terms, restrictions, conditions, vesting requirements, and payment rules of an Other StockUnit Award (collectively, the “Rules”) shall be set forth in the Agreement. Each Other Stock Unit Awardneed not be subject to comparable Rules.(a) An Other Stock Unit Award shall be subject to vesting conditions set forth in the applicableAgreement. Such vesting conditions may be based on any criterion permitted by Section 8.2 (Vesting);provided that, except as provided in Section 12.2 (Acceleration of Vesting), the minimum vesting periodrequired by Section 8.2 shall also apply for Other Stock Unit Awards.(b) An Other Stock Unit Award may be contingent on the payment of cash consideration by theParticipant upon receipt of the Award or provide that the Award, and any Stock or other securities issuedin conjunction with the Award, be delivered without the payment of cash consideration.(c) An Other Stock Unit Award may be subject to a deferred payment schedule, if so set forth in theAgreement.(d) The Administrator, in its sole and complete discretion, as a result of certain circumstances,including the assumption of, or substitution of stock unit awards of a company with which Avnet or aSubsidiary participates in an acquisition, separation, or similar corporate transaction, may waive orotherwise remove, in whole or in part, any restriction or condition imposed on an Other Stock UnitAward at the time of grant.ARTICLE 11EXECUTIVE INCENTIVE PERFORMANCE AWARDS 11.1. EIP Awards. The Committee (and the CEO to the extent permitted by Section 4.6) may issue EIPAwards to Eligible Employees who are Executive Officers or members of senior management of Avnet orof any of its Subsidiaries. Neither this Article 11 nor any other provision of the Plan shall limit in any waythe authority of the CEO and other Company officers to issue incentive pay and cash bonuses to EligibleEmployees who are not Executive Officers.11.2. Determination of EIP Amount. The amount of an EIP Award shall be determined by the Committee(or the CEO to the extent permitted by Section 4.6) and shall be contingent upon the achievement ofPerformance Objectives specified by the Committee, as set forth in the Agreement.11.3. Payment of Awards. EIP Awards shall be paid in cash after the Performance Period has ended andthe Committee has certified that the specified Performance Objectives were achieved. Except as otherwiseexpressly provided in an Agreement, payment shall be made no later than the end of the “applicable 2-1/2month period” described in Treas. Reg. § 1.409A-1(b)(4)(i)(A).11.4. Individual Limitation. The maximum individual EIP Award permitted for a 12-month PerformancePeriod, is $5,000,000. If the Performance Period is not twelve (12) months, the $5,000,000 limitation shallbe adjusted on a pro-rata basis (downward if the Performance Period is less than 12 months and upward ifthe Performance Period is more than 12 months) to reflect the length of the Performance Period. ARTICLE 12ADDITIONAL TERMS AND PROVISIONS 12.1. Agreements. Promptly after the granting of any Award or the modification of any outstandingAward, the Administrator shall cause such Participant to be notified of such action and shall cause Avnet todeliver to such Participant an Agreement (which Agreement shall be signed on behalf of Avnet by anofficer of Avnet with appropriate authorization therefor) evidencing the Award so granted or modified andthe terms and conditions thereof and including (when appropriate) an addendum evidencing the SAR sogranted or modified and the terms and conditions thereof.12.2. Acceleration of Vesting. The Administrator, in its sole discretion, may accelerate the vesting of anyAward (including the lapsing of the Period of Restriction for Restricted Stock), or remove conditions forvesting (or lapsing of the Period of Restriction) upon a Change in Control or the Participant’s death,retirement, layoff, separation from service in connection with a Change in Control, or other separation fromservice where the Administrator determines that such treatment is appropriate and in the Company’s bestinterests, as well as upon assumption of, or in substitution for equity awards of a company with whichAvnet or a Subsidiary participates in an acquisition, separation, merger, or similar corporate transaction;provided, however, that with respect to an Award to a Covered Participant that is intended to qualify as“other performance-based compensation,” waiver of performance conditions shall be permitted only to theextent permitted by Revenue Ruling 2008-13 or any successor thereto. In addition, the Administrator maygrant awards of Restricted Stock, Restricted Stock Units, and Other Stock Unit Awards that do not satisfythe minimum vesting periods and Periods of Restriction prescribed by Sections 7.3, 8.2, and 10.3(a);provided, however, that the total number of shares of Stock underlying Awards that do not satisfy suchminimum vesting periods and Periods of Restriction shall not exceed five percent (5%) of the total numberof shares available for grant under the Plan.12.3. Tax Withholding. The Company shall have the right to deduct from all amounts paid to aParticipant or beneficiary any taxes that it determines are required by law to be withheld in respect ofAwards under the Plan. In the case of an Award settled in shares of Stock, no shares of Stock shall beissued, and no election under Section 83(b) of the Code shall be accepted, unless and until arrangementssatisfactory to the Company have been made to satisfy any applicable withholding tax obligations. Withoutlimiting the generality of the foregoing and subject to such terms and conditions as the Committee mayimpose, the Company shall have the right to (a) retain shares of Stock or (b) subject to such terms andconditions as the Committee may establish from time to time, allow Participants or beneficiaries to (i)tender shares of Stock (including shares of Stock issuable in respect of an Award) to satisfy, in whole or inpart, the amount required to be withheld, or (ii) pay the required tax withholding amount to Avnet in cash;and the fair market value of shares of Stock withheld may exceed the minimum statutory withholdingrequirements. For purposes of determining the number of shares of Stock required to satisfy a taxwithholding obligation, the fair market value shall be calculated as of the date that the amount to bewithheld is determined. A Participant or beneficiary shall pay Avnet cash for any fractional share thatwould otherwise be required to be withheld. Regardless of the amount withheld, each Participant andbeneficiary shall be responsible at all times for paying all federal, state, and local income and employmenttaxes allocable to such Participant or beneficiary with respect to any Award (including taxes due withrespect to imputed income), and the Company shall not be responsible for any interest or penalty that aParticipant incurs by failing to make timely payments of tax.12.4. No Right to Employment; No Right to Award. The Plan shall not confer upon any Participant orother individual any right with respect to continuance of employment by the Company, or continuance ofmembership on the Board of Directors, nor shall it interfere in any way with his right, or the Company’sright, to terminate his employment or Board membership at any time. No provision of the Plan shall beconstrued to give any Eligible Employee or Non-Employee Director a right to receive an Award.12.5. Shareholder Rights. Except as provided in Article 7 with respect to Restricted Stock, no Participantshall acquire or have any rights as a shareholder of Avnet by virtue of any Award until the shares of Stock issued pursuant to the Award or the exercise thereof are recorded in the book and records of Avnet inaccordance with the terms of the Plan. Subsequent to such recordation in the book and records of Avnet,the recipient of shares of Stock shall have the full rights of a holder of such Stock.12.6. Registration of Shares. It is Avnet’s present intention to register the shares of Stock issuedpursuant to the Plan under the Securities Act as necessary. Avnet shall not be obligated to sell or deliverany shares of Stock pursuant to the granting, vesting, or exercise of any Award unless and until—(a) either (i) Avnet has received from its counsel an opinion concluding that such shares need not beregistered under the Securities Act, or (ii) (A) such shares have been registered under the Securities Act,(B) no stop order suspending the effectiveness of such registration statement has been issued and noproceedings therefor have been instituted or threatened under the Securities Act, and (C) there isavailable at the time of such grant, vesting event, or exercise (as applicable) a prospectus containingcertified financial statements and other information meeting the requirements of Section 10(a)(3) of theSecurities Act;(b) such shares are (or upon official notice of issuance will be) listed on each national securitiesexchange on which the class of Stock is then listed;(c) if necessary, the prior approval of such delivery has been obtained from any State regulatorybody having jurisdiction (but nothing herein contained shall be deemed to require Avnet to register orqualify as a foreign corporation in any State nor, except as to any matter or transaction relating to thesale or delivery of such shares, to consent in service of process in any State); and(d) if the Committee so requires, Avnet has received an opinion from its counsel with respect tocompliance with the matters set forth in subsections (a), (b), and/or (c) of this Section 12.6.In addition, the making of any Award or determination, the delivery or recording of a stock transfer, andpayment of any amount due to a Participant may be postponed for such period as Avnet may require, in theexercise of reasonable diligence, to comply with the requirements of any applicable law.12.7. Document Requirements. The Committee may require, as a condition of any payment or shareissuance, that certain agreements, undertakings, representations, certificates, and/or information, as theCommittee may deem necessary or advisable, be executed or provided to the Company to assurecompliance with all applicable laws.12.8. Deferrals. The Administrator may allow a Participant to elect to defer receipt of any payment ofcash or any delivery of shares of Stock that would otherwise be due to such Participant by virtue of theexercise, earn-out, or settlement of any Award made under the Plan, other than Options or StockAppreciation Rights. If such election is permitted, the Committee shall establish rules and procedures forsuch deferrals, including provisions that the Committee or the Participant determines are necessary oradvisable to comply with, or avoid being subject to, the requirements of Section 409A of the Code, andprovisions for the payment or crediting of dividend equivalents in respect of deferrals credited in units ofStock.12.9. Recoupment. Each Award shall be subject to the terms and conditions of Avnet’s compensationrecoupment or clawback policy, as in effect and amended from time to time, including disgorgement orrepayment to the extent required by such policy (taking into account changes to such policy that are madeafter the date hereof and after the date of the applicable Agreement).12.10. Nontransferability. Except as otherwise provided in Section 7.7 (Foreign Laws), this Section12.10, or the applicable Agreement, no Award granted under the Plan, and no interests therein, may besold, transferred, pledged, assigned, exchanged, encumbered or otherwise alienated or hypothecated; andeach Award shall be exercisable during the Participant’s lifetime only by the Participant or his legal guardian orrepresentative.(a) An Award may be transferred by testamentary disposition or the laws of descent and distribution.(b) The Committee shall have sole discretion to approve, and to establish terms and conditions for, atransfer of an Option other than an Incentive Stock Option to (i) the child, step-child, grandchild, parent,stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law,son-in-law, daughter-in-law, brother-in-law, sister-in-law, including adoptive relationships, and anyperson sharing the Participant’s household (other than a tenant or employee) of the Participant (an“Immediate Family Member”); (ii) a trust in which Immediate Family Members have more than 50% ofthe beneficial interest; (iii) a foundation in which Immediate Family Members or the Employee controlthe management of the assets; or (iv) any other entity in which Immediate Family Members or theEmployee own more than 50% of the voting interests (each (i) — (iv), a “Permitted Transferee”);provided, however, that, without the prior approval of the Committee, no Permitted Transferee shallfurther transfer an Award, either directly or indirectly, other than by testamentary disposition or the lawsof descent and distribution. For example, without prior approval of the Committee, a PermittedTransferee may not transfer an Award by reason of the dissolution of, or a change in the beneficiaries of,a Permitted Transferee that is a trust; the sale, merger, consolidation, dissolution, or liquidation of aPermitted Transferee that is a partnership (or the sale of all or any portion of the partnership intereststherein); or the sale, merger, consolidation, dissolution or liquidation of a Permitted Transferee that is acorporation (or the sale of all or any portion of the stock thereof).(c) The Committee shall have discretion to authorize a transfer pursuant to a domestic relations order;provided, however, that the Committee shall not be required under any circumstance to accept orapprove a transfer pursuant to a domestic relations order.(d) An Award may be forfeited or transferred to the extent required to satisfy a tax levy or judgmentunder the Mandatory Victims Restitution Act or similar federal or state law.12.11. Applicable Law and Severability. The Plan, and its rules, rights, agreements and regulations, shallbe governed, construed, interpreted and administered solely in accordance with the laws of the state ofNew York, without regard to any conflicts or choice of law rule or principle that might otherwise referconstruction or interpretation of the Plan to the substantive law of another jurisdiction. If any provision ofthe Plan is held invalid, illegal, or unenforceable, in whole or in part, for any reason, such determinationshall not affect the validity, legality or enforceability of any remaining provision, portion of provision orthe Plan overall, which shall remain in full force and effect as if such invalid, illegal or unenforceableprovision (or portion thereof) had never been included in the Plan.12.12. Special Incentive Compensation. No shares of Stock or other remuneration provided pursuant toan Award, other than an EIP Award, shall be included in compensation for purposes of determining theamount payable to any individual under any pension, savings, retirement, life insurance, or other employeebenefits arrangement of the Company, unless otherwise determined by the Company. Remunerationprovided pursuant to an EIP Award shall be included in compensation to the extent (and only to the extent)required by the applicable employee benefits arrangement.12.13. Section 16(b) of the Exchange Act. All Agreements for Participants subject to Section 16(b) of theExchange Act shall be deemed to include any such additional terms, conditions, limitations and provisionsas Rule 16b-3 requires, unless the Committee in its discretion determines that any such Award should notbe governed by Rule 16b-3. In addition, with respect to persons subject to Section 16(b) of the ExchangeAct, transactions under the Plan are intended to comply with all applicable conditions of Rule 16b-3. To theextent that any provision of the Plan or any action by the Administrator fails to comply with Rule 16b-3, itshall be deemed null and void, to the extent permitted by law and deemed advisable by the Committee. 12.14. Section 162(m) of the Code. Each Award to a Covered Participant that is contingent upon theachievement of Performance Objectives shall be deemed to include any such additional terms, conditions,limitations, and other provisions as are necessary for such Award to qualify as “other performance-basedcompensation” within the meaning of Section 162(m)(4)(C) of the Code, unless the Committee in itsdiscretion determines that such Award is not intended to qualify as “other performance-basedcompensation.” Performance Objectives for each Award granted to a Covered Employee shall be measuredover a stated Performance Period, on an absolute basis or relative to a pre-established target, as specified bythe Committee and reflected in the Agreement. The Performance Objectives for each Award that isintended to qualify as “other performance-based compensation” shall be set forth in writing, at a time whenachievement of the Performance Objectives is substantially uncertain, no later than the earlier of (a) 90days after commencement of the period of service (within the meaning of Treas. Reg. § 1.162-27(e)(2)(i))to which the Performance Objectives relate, or (b) before 25 percent (25%) of such period of service haselapsed. To the extent permitted by Section 162(m)(4)(C) of the Code, the Committee may adjustperformance results to take into account extraordinary, unusual, non-recurring, or non-comparable items,and shall have discretion to reduce (but not to increase) the amount due upon achievement of anyPerformance Objective. No amount shall be paid to a Covered Employee pursuant to an Award that iscontingent upon the achievement of Performance Objectives unless and until the Committee has certifiedthat the Performance Objectives have been satisfied. To the extent required by Section 162(m) of the Code,canceled Awards shall continue to be counted against the limit set forth in Section 3.2 (IndividualLimitations) on shares of Stock available for Awards.12.15. Section 409A of the Code. The Plan, any Award granted under the Plan, and all Agreementsevidencing such Awards, shall be interpreted, administered, and construed consistent with the intent that (a)all options, SARs, and comparable awards shall be exempt from Section 409A of the Code by reason of theexemption for certain stock rights set forth in Treas. Reg. § 1.409A-1(b)(5); (b) all Awards of RestrictedStock shall be exempt from Section 409A of the Code by reason of the exemption for restricted propertygoverned by Section 83 of the Code set forth in Treas. Reg. § 1.409A-1(b)(6); and (c) except to the extentthat the applicable Agreement clearly sets forth an intent to provide for nonqualified deferred compensationthat is subject to the requirements of Section 409A, all Restricted Stock Unit Awards, Performance ShareUnit Awards, Other Stock Unit Awards, and EIP Awards shall be exempt from Section 409A of the Codeby reason of the “short-term deferral rule” set forth in Treas. Reg. § 1.409A-1(b)(4).12.16. Application of Proceeds. The proceeds received by the Company from the sale of Stock under thePlan shall be used for general corporate purposes.12.17. Rules of Construction. Whenever used in the Plan, (a) words in the masculine gender shall bedeemed to refer to females as well as to males; (b) words in the singular shall be deemed to refer also to theplural; (c) the word “include” shall mean “including but not limited to”; (d) references to a statute orregulation or statutory or regulatory provision shall refer to that provision (or to a successor provision ofsimilar import) as currently in effect, as amended, or as reenacted, and to any regulations and other formalguidance of general applicability issued thereunder; and (e) references to a law shall include any statute,regulation, rule, court case, or other requirement established by an exchange or a governmental authorityor agency, and applicable law shall include any tax law that imposes requirements in order to avoidadverse tax consequences.12.18. Headings and Captions. The headings and captions in this Plan document are provided forreference and convenience only, shall not be considered part of the Plan, and shall not be employed in theconstruction of the Plan.12.19. Effective Date. The Plan shall become effective on the date the Plan is approved by Avnet’sshareholders. ARTICLE 13ADJUSTMENTS UPON CHANGES IN CAPITALIZATION 13.1. Share Adjustments. If the Stock is split, divided, or otherwise reclassified into or exchanged for agreater or lesser number of shares of Stock or into shares of Stock and/or any other securities of Avnet byreason of recapitalization, reclassification, stock split or reverse split, combination of shares or otherreorganization, the term “Stock” as used herein shall thereafter mean the number and kind of shares orother securities into which the Stock shall have been so split, divided or otherwise reclassified or for whichthe Stock shall have been so exchanged; and the remaining number of shares of Stock which may, in theaggregate, thereafter be delivered pursuant to the grant or exercise of an Award and the remaining numberof shares of Stock which may thereafter be delivered pursuant to the exercise of any Options and/or StockAppreciation Rights then outstanding, shall be correspondingly adjusted. If a dividend payable in shares ofStock is paid to the holders of outstanding shares of Stock, the remaining number of shares of Stock whichmay, in the aggregate, thereafter be delivered pursuant to the exercise or grant of Awards, and theremaining number of shares of Stock that may thereafter be delivered pursuant to the exercise of anyAwards then outstanding shall be increased by the percentage that the number of shares of Stock so paid asa dividend bears to the total number of shares of Stock outstanding immediately before the payment ofsuch dividend. If an extraordinary cash dividend is paid to the holders of outstanding shares of Stock, theremaining number of shares of Stock that may, in the aggregate, thereafter be delivered pursuant to theexercise or grant of Awards and the remaining number of shares of Stock that may thereafter be deliveredpursuant to the exercise of any Awards then outstanding, shall be equitably adjusted by the Committee.13.2. Exercise Price Adjustments. If the Stock is split, divided or otherwise reclassified or exchanged, orthat any dividend payable in shares or Stock or extraordinary cash dividend is paid to the holders ofoutstanding shares of Stock, in each case, as provided in the preceding paragraph, the purchase price pershare of Stock upon exercise of outstanding Options, and the aggregate number of shares of Stock withrespect to which Awards may be granted to any Participant in any calendar year, shall be correspondinglyadjusted.13.3. Fractional Shares. Notwithstanding any other provision of this Article 13, if upon any adjustmentmade in accordance with Section 13.1 above, the remaining number of shares of Stock which maythereafter be delivered pursuant to the exercise of any Award then outstanding shall include a fractionalshare of Stock, such fractional share of Stock shall be disregarded for all purposes of the Plan and theOptionee holding such Award shall become entitled neither to purchase the same nor to receive cash orother property in payment therefor or in lieu thereof.ARTICLE 14AMENDMENT OR TERMINATION OF THE PLAN 14.1. The Plan shall automatically terminate on November 30, 2023, unless it is sooner terminatedpursuant to Section 14.2, below. No Award shall be granted after the Plan terminates. All Awards grantedbefore the Plan terminates shall continue in effect thereafter in accordance with the terms of the applicableAgreements and the Plan.14.2. Reservation of Rights. The Board of Directors may amend or terminate the Plan at any time as theBoard may deem advisable and in the best interests of Avnet; provided, however, that—(i) the terms of an outstanding Award shall not be changed without written consent of the Participantand,(ii) the affirmative vote of a majority of the votes cast at a meeting of the shareholders of Avnet dulycalled and held for that purpose, shall be required for any change that (a) affects the composition orfunctioning of the Committee; (b) materially increases the aggregate number of shares of Stock that may be delivered pursuant to the exercise of Awards; (c) materially increases the aggregate number of sharesof Stock with respect to which Options or other Awards may be granted to any Participant during anycalendar year; (d) materially decreases the minimum purchase price per share of Stock (in relation to theFair Market Value thereof at the respective dates of grant) upon the exercise of Options; (e) extends theten-year maximum period within which an Award is exercisable or the termination date of the Plan; or(f) otherwise triggers a shareholder approval requirement under an applicable law or listing standard. Exhibit 10.12AVNET, INC.2016 STOCK COMPENSATION AND INCENTIVE PLAN(As Amended and Restated Effective as of May 8, 2018)ARTICLE 1PURPOSE OF THE PLANThe Avnet, Inc. 2016 Stock Compensation and Incentive Plan, as amended and restated, is intended to advance theinterests of the Company by helping Avnet and its Subsidiaries to attract, retain, and appropriately motivate high caliberpersons to serve as Eligible Employees and Non-Employee Directors, and by providing incentives to Eligible Employeesand Non-Employee Directors that are consistent with the shareholders’ interest in maximizing the value of Avnet’s Stock.ARTICLE 2DEFINITIONSThe following terms, when used in capitalized form, shall have the meanings set forth below:2.1. “Administrator” means—(a) with respect to each Award granted to an Eligible Employee, the Committee; and(b) with respect to each Award granted to a Non-Employee Director, the Independent Directors.2.2. “Agreement” means the document (written or electronic) that evidences an Award granted hereunder and sets forththe material terms thereof, including any addendum thereto. Each Agreement shall be in such form as prescribed orapproved by the Administrator.2.3. “Avnet” means Avnet, Inc.2.4. “Award” means a grant under the Plan of an Option, Stock Appreciation Right, Restricted Stock, Restricted StockUnit, Performance Share Unit, Other Stock Unit Award, or Executive Incentive Performance Award, as evidenced by anAgreement.2.5. “Board of Directors” and “Director” shall mean, respectively, the Board of Directors of Avnet and any memberthereof.2.6. “Change in Control” means the happening of any of the following:(a) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of theExchange Act (a “Person”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under theExchange Act) of more than 50% of either: (A) the then outstanding shares of Stock or (B) the combined votingpower of the then outstanding voting securities of Avnet entitled to vote generally in the election of Directors;provided, however, that the following transactions shall not constitute a Change in Control under this subsection(a): (i) any acquisition directly from Avnet (excluding an acquisition by virtue of the exercise of a conversion privilege), (ii) anyacquisition by Avnet or an entity controlled by Avnet, or (iii) an acquisition by any employee benefit plan (orrelated trust) sponsored or maintained by Avnet or any entity controlled by Avnet; or(b) the individuals who, as of the date of the 2016 annual meeting of Avnet’s stockholders (the “DeterminationDate”) constitute the Board of Directors (the “Incumbent Board”) cease for any reason to constitute at least amajority of the Board of Directors; provided, however, that an individual who becomes a Director subsequent tothe Determination Date shall be treated as a member of the Incumbent Board if (i) his election, or nomination forelection by Avnet’s stockholders, was approved by a vote of at least a majority of the Directors then comprisingthe Incumbent Board, and (ii) his initial assumption of office does not occur as a result of an actual or threatenedsolicitation of proxies or consents by or on behalf of a Person other than a majority of the then Incumbent Board;or(c) a complete liquidation or dissolution of Avnet, or the sale or other disposition of all or substantially all of theassets of Avnet (in one or more transactions).2.7. “CEO” means the Chief Executive Officer of Avnet.2.8. “Code” means the Internal Revenue Code of 1986, as amended.2.9. “Committee” means the Compensation Committee of the Board of Directors, which shall consist of three or moreNon-Employee Directors appointed by the Board of Directors. No individual who is not both a “non-employee director”within the meaning of Rule 16b-3 and an “outside director” within the meaning of Section 162(m) of the Code shall serveas a member of the Committee.2.10. “Company” means Avnet and all its Subsidiaries.2.11. “Covered Participant” means a Participant who is a “covered employee” under Section 162(m) of the Code.2.12. “Eligible Employee” means an employee of Avnet or of any of its Subsidiaries. The term “Eligible Employee” shallalso include an individual retained by Avnet or any of its Subsidiaries to render services as a consultant or advisor otherthan services in connection with the offer or sale of securities in a capital-raising transaction or services that directly orindirectly promote or maintain a market for Avnet’s securities.2.13. “Exchange Act” means the Securities Exchange Act of 1934, as amended.2.14. “Executive Incentive Performance Award” or “EIP Award” means a performance-based cash award grantedpursuant to Article 11.2.15. “Executive Officer” means an employee designated by Avnet as an executive officer under Rule 16b-3.2.16. “Fair Market Value” means, with respect to any date, the closing price (as reported for the Nasdaq CompositeIndex) at which shares of Stock have been sold on such date (or, if such date is a date for which no trading is so reported,on the next preceding date for which trading is so reported), or such other price as determined by the Committee inaccordance with applicable law.2.17. “Grant Date” means, with respect to granting an Award or modification of an outstanding Award, the date onwhich the material terms of the Award (including the number of shares covered by the Award, the conditions for vesting,lapse of the Period of Restriction, and exercise, and the purchase price, if any) are established and all action constitutingthe making or modification of such Award is completed, without regard to (a) the date on which the applicableAgreement is executed or (b) whether such Award or modification is subject to future shareholder approval or otherconditions. The Grant Date for any Award shall not occur before the recipient of the Award becomes an EligibleEmployee or Non-Employee Director, as applicable. 2.18. “Incentive Stock Option” or “ISO” means an Option intended to qualify as an “incentive stock option” underSection 422 of the Code.2.19. “Independent Directors” means members of the Board of Directors acting as a group, each of whom satisfiesAvnet’s “Director Independence Standards.”2.20. “Non-Employee Director” means a Director who is not an Eligible Employee.2.21. “Option” means an Award granted pursuant to Article 5. In general, an Option gives the recipient the right topurchase a specified number of shares, which may be vested shares or Restricted Stock, at a specified price during aspecified term, subject to the terms and conditions of the applicable Agreement.2.22. “Optionee” means a person who, at the time in question, holds an Option that then remains unexercised in whole orin part, has not been surrendered, and has not expired or terminated. The term “Optionee” also includes any SuccessorOptionee.2.23. “Other Stock Unit Award” means a full value Award (i.e., not an Option, SAR, or other appreciation award) grantedpursuant to Article 10.2.24. “Participant” means an Eligible Employee or Non-Employee Director who has been granted an Award hereunder.2.25. “Performance Criteria” means any of the following criteria as related to Avnet, any Subsidiary, or any division orother area of Avnet or a Subsidiary:(i) Economic profit; economic value added; price of Stock; total stockholder return; revenues; sales; salesproductivity; sales growth; net income; operating income; gross profit; earnings per share; return on equity; returnon investment; return on capital employed; cash flow; operating margin; gross margin; operating unitcontribution; achievement of annual operating profit plans; debt level; market share; net worth; or other similarfinancial performance measures as may be determined by the Committee; or(ii) Strategic business criteria consisting of one or more objectives based on meeting specified market penetrationor market share; geographic business expansion; objective customer satisfaction goals; objective goals relating todivestitures, joint ventures, mergers, acquisitions, and similar transactions; implementation or completion ofspecified projects or processes strategic or critical to the Company’s business operations; individual businessobjectives; objective measures of brand recognition/acceptance; performance achievements on designatedprojects or objectives; objective measures of regulatory compliance; successful completion of internal or externalaudits; successful integration of business units; successful hiring, retention of talent, or other succession planning;or objective measures of employee engagement and satisfaction.In addition, for any Participant who is not a Covered Participant, Performance Criteria may include any other criteriaselected by the Committee.2.26. “Performance Objectives” means, for any Award that is contingent in whole or in part on achievement ofperformance objectives, the objectives or other performance levels with respect to specified Performance Criteria that aremeasured over a Performance Period for the purpose of determining the amount of such Award and/or whether suchAward is granted or vested.2.27. “Performance Period” means a period over which achievement of Performance Objectives is measured, as set forthin the applicable Agreement.2.28. "Performance Share Unit” means an Award granted pursuant to Article 9. In general, a Performance Share Unitgives the recipient a contractual right to receive a target number of shares of Stock or cash upon the attainment ofspecified Performance Objectives.2.29. “Period of Restriction” means the period during which the transfer of shares of Restricted Stock is restricted,pursuant to Article 7. 2.30. “Plan” means the Avnet, Inc. 2016 Stock Compensation and Incentive Plan, as set forth herein and as amendedfrom time to time.2.31. “Restricted Stock” means an Award of Stock granted pursuant to Article 7. In general, Restricted Stock is Stockthat, during a Period of Restriction, is subject to a substantial risk of forfeiture and restrictions against sale or othertransfer.2.32. “Restricted Stock Unit” means an Award granted pursuant to Article 8. In general, a Restricted Stock Unit givesthe recipient a contractual right to receive cash or shares of Stock upon the attainment of specified vesting conditions.2.33. “Rule 16b-3” means SEC Rule 16b-3 promulgated under the Exchange Act.2.34. “Securities Act” means the Securities Act of 1933, as amended.2.35. “Stock” means, subject to the adjustment provisions set forth in Article 13, Avnet’s $1.00 par value commonstock.2.36. “Stock Appreciation Right” or “SAR” means an Award granted pursuant to Article 6. In general, a StockAppreciation Right gives the recipient the right to receive, upon exercise of the Award, an amount equal to the excess ofthe Fair Market Value of the shares of Stock with respect to which the SAR is being exercised (determined as of theexercise date) over the exercise price set forth in the Agreement.2.37. “Subsidiary” means a corporation in which Avnet directly or indirectly owns more than 50% of the total combinedvoting power of all classes of capital stock.2.38. “Successor Optionee” means any person who, under the provisions of Article 5, has acquired from an Optioneethe right to exercise an Option, for so long as such Option remains unexercised in whole or in part, and has not beensurrendered, exercised, or terminated.ARTICLE 3SHARES RESERVED FOR THE PLAN3.1. General Limitations. Subject to the adjustment provisions set forth in Article 13, the maximum number of shares ofStock that may be delivered pursuant to the exercise of Awards granted under the Plan shall be 5,000,000. All suchshares shall be available for any type of Award, including Incentive Stock Options. At no time shall there be outstandingAwards under the Plan covering more than such maximum number of shares less the aggregate of the shares of Stockpreviously delivered pursuant to the exercise of Options (including the shares of Stock previously covered by Optionssurrendered in connection with the exercise of SARs), the shares of Stock with respect to which stock-settled SARs havebeen exercised (without regard to the number of shares of Stock issued upon settlement of such SARs), and the shares ofStock previously delivered pursuant to the vesting of Restricted Stock, Restricted Stock Units, Performance Share Units,and Other Stock Unit Awards. The shares of Stock authorized hereunder shall be in addition to the shares of Stockauthorized for grant under the Avnet, Inc. 2013 Stock Compensation Plan (the “2013 Plan”), which shall continue to beavailable for grant under the 2013 Plan. Shares of Stock subject to Awards may consist of authorized but unissued sharesof Stock and/or shares of Stock held in Avnet’s treasury.3.2. Individual Limitations. No individual may be granted Awards in any calendar year for more than 1,000,000 shares inthe aggregate (including Options, SARs, Restricted Stock, Restricted Stock Units, Performance Share Units, and otherequity-based awards). Awards granted to an individual in a calendar year may consist of a single type (e.g., Options) or amix of types, as long as the aggregate share limit for the year is not exceeded. In addition, no Non-Employee Directormay be granted Awards covering shares with a value at the time of grant of more than $1 million in any calendar year;provided, however, that Awards covering shares with a value of up to $2 million may be granted to a Non-EmployeeDirector during the calendar year in which the Non-Employee Director first joins the Board of Directors or is firstdesignated as Chairman of the Board of Directors or Lead Director. 3.3. Termination and Expiration of Awards. If an Award is canceled, forfeited, expired or otherwise terminates or issettled without delivery of shares of Stock, whether in whole or in part, the number of shares of Stock covered by suchAward immediately before such cancellation, forfeiture, expiration, termination, or settlement shall thereupon be addedback to the number of shares of Stock otherwise available for further grants of Awards hereunder; provided, however,that the following transactions involving shares of Stock shall not result in shares of Stock becoming available forsubsequent Awards: (a) Stock tendered or withheld in payment of the exercise price of an Option; (b) Stock tendered orwithheld for taxes; (c) Stock that was subject to a stock-settled SAR or an Option that was related to a SAR and was notissued upon the settlement or exercise of such SAR; and (d) Stock repurchased by the Company with the proceeds of anOption exercise.ARTICLE 4ADMINISTRATION OF THE PLAN4.1. Plan Administration. This Plan shall be administered by the Administrator. The Administrator shall have full andexclusive power to: (a) construe and interpret the Plan; (b) establish and amend rules and regulations for theadministration of the Plan; (c) correct any defect, remedy any omission, and reconcile any ambiguity or inconsistency inthe Plan or any Award in the manner and to the extent it deems necessary or desirable to carry out the intent of the Planand such Award; and (d) certify the level as to which each Performance Objective was attained. Subject to Section 4.6, the Administrator may delegate some or all of its authority under the Plan (including powers not referenced in thisSection 4.1) to one or more Company officers, to the extent permitted by and not inconsistent with any requirements ofapplicable law.4.2. Committee’s Authority to Grant Awards. In addition to the powers enumerated in Section 4.1 (and without limitingthe generality thereof), the Committee shall have plenary authority and discretion to determine the time or times at whichAwards shall be granted to Eligible Employees, the Eligible Employees to whom Awards shall be granted, the number ofshares of Stock (or for Awards denominated in cash, the dollar amount) to be covered by each such Award, and the termsand conditions upon which each such Award may be exercised (in each case, to the extent not inconsistent with theprovisions of this Plan). Subject to the requirements of the Plan, the terms and conditions prescribed or approved for anyAward granted by the Committee (as reflected in the applicable Agreement) shall be entirely within the discretion of theCommittee.4.3. Independent Directors’ Authority to Grant Awards. In addition to the powers enumerated in Section 4.1 (andwithout limiting the generality thereof), the Independent Directors shall have plenary authority and discretion todetermine the time or times at which Awards shall be granted to Non-Employee Directors, the Non-Employee Directorsto whom Awards shall be granted, the number of shares of Stock (or for Awards denominated in cash, the dollar amount)to be covered by each such Award, and the terms and conditions upon which each such Award may be exercised (ineach case, to the extent not inconsistent with the provisions of this Plan); provided that (a) no Director shall participate inany action taken with respect to an Award granted or to be granted to such Director, unless the same action iscontemplated for all similarly situated Directors, and (b) no Award shall be granted to a Non-Employee Director unlesssuch grant is approved by a majority of the Independent Directors. Subject to the requirements of the Plan, the terms andconditions prescribed or approved for any Award granted by the Independent Directors (as reflected in the applicableAgreement) shall be entirely within the discretion of the Independent Directors.4.4. Actions of the Committee. A majority of the members of the Committee (but not less than two) shall constitute aquorum, and all acts, decisions or determinations of the Committee shall be by majority vote of such of its members asshall be present at a meeting duly held at which a quorum is so present. Any act, decision, or determination of theCommittee reduced to writing and signed by a majority of its members (but not less than two) shall be fully effective as ifit had been made, taken or done by vote of such majority at a meeting duly called and held.4.5. Reporting. The Committee shall provide reports as may from time to time be prescribed by the Board of Directors.4.6. CEO Authority to Grant Awards. The CEO shall have authority to make Awards to Eligible Employees who are notExecutive Officers or Covered Participants, including Eligible Employees who are promoted to Executive Officerpositions, subject to such limits, if any, as the Committee may impose. The CEO shall have plenary authority anddiscretion to determine the time or times at which Awards that the CEO is authorized to grant shall be granted, theEligible Employees to whom such Awards shall be granted, the number of shares of Stock (or for Awards denominated incash, the dollar amount) to be covered by each such Award, and the terms and conditions upon which each such Awardmay be exercised (in each case, to the extent not inconsistent with the provisions of this Plan). 4.7. Determining Amount Payable. With respect to any Award that is conditioned in whole or in part on the achievementof Performance Objectives, the Administrator shall determine the extent to which the applicable Performance Objectiveswere achieved and shall have discretion to reduce the amount that becomes vested or payable upon achievement of suchPerformance Objectives.4.8. Decisions of the Administrator. All determinations and decisions made by the Administrator pursuant to theprovisions of the Plan shall be final, conclusive, and binding upon all persons and the Company, except to the extent thatthe terms of any sale or award of shares of Stock, or any grant of rights or Options under the Plan, are required by law orby the Articles of Incorporation or By-laws of Avnet to be approved by the Board of Directors or shareholders.4.9. Law Compliance. Notwithstanding any other provision of the Plan, the Administrator may impose such conditions onany Award, and the Board of Directors may amend the Plan in any such respects, as the Administrator or the Board ofDirectors determines is necessary or desirable to avoid adverse consequences under Rule 16b-3, Section 162(m) of theCode, Section 409A of the Code, Section 280G of the Code, or any other applicable law; and the Plan shall be construedconsistently with the intent to avoid adverse consequences under applicable law.ARTICLE 5OPTIONS5.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant Options to EligibleEmployees, and the Independent Directors may grant Options to Non-Employee Directors.5.2. Exercise Price. The price per share at which Stock subject to an Option may be purchased shall be set forth in theAgreement. In no event shall such exercise price be less than 100% of the Fair Market Value of the Stock on the GrantDate.5.3. Term. The term of each Option granted under the Plan shall be set forth in the Agreement; provided, however, that inno event shall an Option be exercisable after the day before the tenth anniversary of the Grant Date. Unless soonerforfeited or otherwise terminated pursuant to the terms hereof or of the Agreement, each Option granted under the Planshall expire at the end of its term, and the term may not be extended. No Option may be exercised after the expiration ofits term.5.4. Exercisability (Vesting). Each Option granted under the Plan shall be subject to the vesting conditions set forth in theAgreement; provided, however, that the exercisability of any Option may be accelerated to the extent permitted bySection 12.2 (Acceleration of Vesting). Subject to Section 12.2, an Option shall become vested no faster than pro rataover the three (3) year period that starts on the Grant Date. Subject to the provisions of the Agreement, each Optiongranted under the Plan that has become exercisable pursuant to this Section 5.4 shall remain exercisable thereafter untilthe expiration of its term as described in Section 5.3.5.5. Exercise. To the extent that an Option has become exercisable in accordance with Section 5.4, such Option may beexercised by notice to Avnet, in a form approved by Avnet, stating the number of shares of Stock with respect to whichsuch Award is being exercised, accompanied by payment in full therefor as described below. After receipt of such noticeand payment, subject to Section 12.6 (Registration of Shares), Avnet shall record the stock transfer on its books andrecords without the need to issue a physical certificate. The payment due upon exercise of an Option may be made inany form permitted by the Administrator. The permitted forms of payment may (but are not required to) include (i) check(certified, if so required by Avnet); (ii) shares of Stock with a fair market value, at the date of receipt by Avnet, equal tothe aggregate exercise price (plus withholding, if applicable); (iii) a combination of check and shares of Stock; (iv)having Avnet retain from the Stock otherwise issuable upon exercise of the Option a number of shares of Stock having afair market value equal to the exercise price of the Option (plus withholding, if applicable); (v) to the extent permitted byapplicable law, by delivering a properly executed exercise notice, together with irrevocable instructions to a broker topromptly deliver to Avnet the exercise price and to deliver to the Participant the net amount of shares received uponexercise (after subtracting the exercise price, withholding, and any broker fee); or (vi) any other manner acceptable to theAdministrator.5.6. General Modification Rules. The Administrator may, for such consideration (if any) as it may deem adequate andwith the prior consent of the Optionee, modify the terms of any outstanding Option; provided, however, that except to theextent permitted by Section 5.8, no Option may be repriced, replaced, or regranted through cancellation, or by loweringthe exercise price of such Option, and no Option with an exercise price that exceeds the Fair Market Value of a share ofStock shall be exchanged for a cash payment, without shareholder approval. 5.7. Dividend Rights. Participants in whose name Options are granted shall not be entitled to receive dividends or otherdistributions with respect to shares of Stock underlying such Options.5.8. Special Modification in the Event of a Corporate Transaction. In the event of a corporate transaction (within themeaning of Treas. Reg. § 1.424-1(a)(3)), the Administrator may provide for the assumption or substitution of outstandingOptions, provided that the requirements of Treas. Reg. § 1.424-1(a) are satisfied with respect to Incentive Stock Options,and the requirements of Treas. Reg. § 1.409A-1(b)(v)(D) are satisfied with respect to all other Options.5.9. Special Rules for Incentive Stock Options (“ISOs”). ISOs shall be subject to the requirements of Section 422 of theCode, including the following (all of which shall be interpreted consistent with the intent to comply with the requirementsof Section 422 of the Code and not to impose any restrictions that are not required by Section 422):(a) Shares Available for ISO Grants. All shares of Stock authorized for Awards under Article 3 are available to be issuedthrough ISOs; provided, however, that to the extent required by Section 422 of the Code, canceled Awards shallcontinue to be counted against the number of shares available.(b) Optionee Must Be an Employee. No ISO shall be granted to any individual who is not an employee of Avnet or aSubsidiary.(c) Special Rules for 10% Owners. An Incentive Stock Option shall not be granted to an individual who, immediatelybefore the time the Option is granted, owns shares of Stock possessing more than 10 percent of the total combined votingpower of all classes of stock of Avnet, unless the Agreement for such Incentive Stock Option provides that (i) theexercise price is no less than 110 percent (110%) of the Fair Market Value of the Stock on the Grant Date (determined inaccordance with Treas. Reg. § 1.422-2(f)(1)), and (ii) the Option expires no later than the fifth anniversary of the GrantDate.ARTICLE 6STOCK APPRECIATION RIGHTS (“SARs”)6.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant SARs to Eligible Employees, and the Independent Directors may grant SARs to Non-Employee Directors. Each SAR may be free-standing or relatedto all or part of an Option. In the discretion of the Administrator, a SAR related to an Option may be granted at any timebefore the related Option is exercised, expires, is terminated, or is surrendered, and may be modified when the relatedOption is modified.6.2. Exercise Price. The exercise price per share for each free-standing SAR granted under the Plan shall be set forth inthe Agreement. In no event shall the exercise price be less than 100% of the Fair Market Value of the Stock on the GrantDate.6.3. Term. The term of each SAR granted under the Plan shall be set forth in the Agreement; provided, however that in noevent shall a SAR be exercisable after the day before the tenth anniversary of the Grant Date. Unless sooner forfeited orotherwise terminated pursuant to the terms hereof or of the Agreement, each SAR granted under the Plan shall expire atthe end of its term, and the term may not be extended. No SAR may be exercised after the expiration of its term.6.4. Exercisability (Vesting). Each SAR granted under the Plan shall be subject to the vesting conditions set forth in theAgreement; provided, however, that (a) the exercisability of any SAR may be accelerated to the extent permitted bySection 12.2 (Acceleration of Vesting), and (b) if a SAR relates to all or part of an Option, such SAR shall be exercisableonly to the extent that the related Option is exercisable. Subject to Section 12.2, a SAR shall become vested no fasterthan pro rata over the three (3) year period that starts on the Grant Date. Subject to the provisions of the Agreement,each SAR that is exercisable pursuant to this Section 6.4 shall remain exercisable thereafter until the expiration of its termas described in Section 6.3.6.5. Exercise. To the extent that a SAR has become exercisable in accordance with Section 6.4, such SAR may beexercised in accordance with the procedures set forth in Section 5.5 (Exercise), but without the requirement to make apayment therefor. If the SAR is related to all or part of an Option, the Optionee must provide with the exercise notice aninstrument effecting the surrender of the related portion of the Option. Each SAR may be settled in shares of Stock, cash, or a combination of cash and shares (providedthat shares of Stock underlying any SAR that is settled in cash shall not be available to be issued in a future Award). Nofractional shares shall be issued; any amount that would have been payable in fractional shares shall be paid in cash.6.6. Other Conditions. The Administrator (or its designee) may impose any other conditions upon the exercise of SARs.Such conditions may govern the right to exercise SARs granted before the adoption or amendment of such conditions aswell as SARs granted thereafter.6.7. Dividend Rights. Participants in whose name SARs are granted shall not be entitled to receive dividends or otherdistributions with respect to shares of Stock underlying such SARs.6.8. Modification and Cancellation Rules. The modification and cancellation rules and restrictions set forth in Sections5.6 (General Modification Rules) and 5.8 (Special Modification in the Event of a Corporate Transaction) shall alsoapply with respect to SARs.ARTICLE 7RESTRICTED STOCK7.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant Restricted Stock to EligibleEmployees, and the Independent Directors may grant Restricted Stock to Non-Employee Directors. The number of sharesgranted pursuant to any Restricted Stock Award, and the purchase price (if any), shall be set forth in the Agreement.7.2. Restrictions. During the Period of Restriction set forth in the applicable Agreement, shares of Restricted Stock shallnot be sold, transferred, pledged, assigned, exchanged, encumbered, alienated, hypothecated, or otherwise disposed of.Except as otherwise provided in the Agreement, if a Participant‘s employment or other service with the Companyterminates before the end of the Period of Restriction for any shares of Restricted Stock, all such restricted shares shall beforfeited, and all rights of the Participant with respect to such shares of Stock shall immediately terminate without anypayment or other consideration therefor; provided that if the Participant paid for any of the forfeited shares, the Companyshall refund the purchase price (without interest or any other earnings). Any forfeited shares of Restricted Stock that hadbeen delivered to, or held in custody for, a Participant shall be returned to Avnet, accompanied by any instrument oftransfer requested by Avnet.7.3. Lapse of Period of Restriction (Vesting). The Period of Restriction for each Award of Restricted Stock shall lapseonly upon satisfaction of conditions set forth in the Agreement. Such conditions may be based on (a) continued service toAvnet or a Subsidiary for a specified period,(b) achievement of Performance Objectives, or (c) a combination of (a) and (b). Subject to Section 12.2, the Period ofRestriction for any Award of Restricted Stock shall lapse no faster than pro rata over the three (3) year period that startson the Grant Date.7.4. Settlement of Restricted Stock. Shares of Restricted Stock shall become freely transferable immediately following thelast day of the Period of Restriction. As soon as practicable after the Period of Restriction lapses, Avnet shall record thestock transfer on its books and records without the need to issue a physical certificate.7.5. Voting Rights. During the Period of Restriction, Participants in whose name Restricted Stock is granted under thePlan may exercise full voting rights with respect to those shares.7.6. Dividend Rights. During the Period of Restriction, Participants in whose name Restricted Stock is granted shall beentitled to receive all dividends and other distributions paid with respect to such Restricted Stock Awards, as set forth inthis Section 7.6. Dividends paid in cash shall be automatically reinvested in additional shares of Restricted Stock at apurchase price per share equal to the Fair Market Value of a share of Stock on the date such dividend is paid; provided,however, that fractional shares shall not be issued. Any amount that would have been invested in a fractional share shallbe payable to the Participant in cash when the Period of Restriction for the underlying shares lapses. All additional sharesof Stock received by a Participant in respect of a dividend or other distribution on Restricted Stock, whether throughreinvestment or through a dividend or other distribution paid in shares of Stock, shall be subject to the same restrictions(for the same Period of Restriction) as the Restricted Stock with respect to which they were received; and the right to receive cash with respect to any fractionalshare shall be subject to forfeiture until the Period of Restriction for the underlying shares lapses.7.7. Foreign Laws. Notwithstanding any other provision of the Plan, if Restricted Stock is to be awarded to a Participantwho is subject to the laws, including the tax laws, of any country other than the United States, the Committee may, in itsdiscretion, direct Avnet to sell, assign, or otherwise transfer the Restricted Stock to a trust or other entity or arrangement,rather than grant the Restricted Stock directly to the Participant.ARTICLE 8RESTRICTED STOCK UNITS8.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant Restricted Stock Units toEligible Employees, and the Independent Directors may grant Restricted Stock Units to Non-Employee Directors. Thenumber of shares of Stock underlying any Restricted Stock Unit Award shall be set forth in the Agreement.8.2. Vesting. An Award of Restricted Stock Units shall be subject to vesting conditions set forth in the applicableAgreement. Such vesting conditions may be based on (a) continued service to Avnet or a Subsidiary for a specifiedperiod, (b) achievement of Performance Objectives, or (c) a combination of (a) and (b). Subject to Section 12.2, aRestricted Stock Unit Award shall become vested no faster than pro rata over the three (3) year period that starts on theGrant Date.8.3. Settlement of Restricted Stock Units. Subject to Section 12.6 (Registration of Shares), as soon as practicable afterany Restricted Stock Unit becomes vested, Avnet shall transfer to the Participant one share of Stock for each such vestedRestricted Stock Unit, cash in lieu of shares of Stock, or a combination of cash and shares of Stock. No fractional sharesshall be issued with respect to vesting of Restricted Stock Units.8.4. Dividend Rights. Participants in whose name Restricted Stock Units are granted shall not be entitled to receivedividends or other distributions with respect to shares of Stock underlying such Restricted Stock Unit, unless theAgreement provides otherwise. Any right to receive dividends or other distributions shall be subject to the same vestingconditions and risk of forfeiture as the Restricted Stock Units with respect to which such right is granted, and alldividends and distributions shall be paid when the applicable Restricted Stock Units are settled.ARTICLE 9PERFORMANCE SHARE UNITS9.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant Performance Share Units toEligible Employees, and the Independent Directors may grant Performance Share Units to Non-Employee Directors. Thetarget and maximum number of Shares deliverable upon achievement of the applicable Performance Objectives shall beset forth in the Agreement.9.2. Vesting. Vesting of Performance Share Units shall be conditioned upon the achievement of specified PerformanceObjectives over a specified Performance Period, and such other conditions as are set forth in the Agreement. Subject toSection 12.2, Awards of Performance Share Units shall become vested no faster than pro rata over the three (3) yearperiod that starts on the Grant Date.9.3. Settlement of Performance Shares. After Performance Share Units become vested, Avnet shall transfer to theParticipant shares of Stock or cash, or a combination of cash and shares of Stock, corresponding to the vested amount(determined after taking into account the Administrator’s discretion to reduce the amount payable upon achievement ofPerformance Objectives). No fractional shares shall be issued with respect to vesting of Performance Share Units. 9.4. Dividend Rights. Participants in whose name Performance Share Units are granted shall not be entitled to receivedividends or other distributions with respect to shares of Stock underlying such Performance Share Units, unless theAgreement provides otherwise. Any right to receive dividends or other distributions shall be subject to the same vestingconditions and risk of forfeiture as the Performance Share Units with respect to which such right is granted, and alldividends and distributions shall be paid when the applicable Performance Share Units are settled.ARTICLE 10OTHER STOCK UNIT AWARDS10.1. Grant. The Committee (and the CEO to the extent permitted by Section 4.6) may grant Other Stock Unit Awards toEligible Employees, and the Independent Directors may grant Other Stock Unit Awards to Non-Employee Directors.Each Other Stock Unit Award may be granted as a stand-alone Award or in connection with another Award made underthe Plan, and may be in the form of Stock or other securities. The number of shares of Stock or other securitiesunderlying any Other Stock Unit Award shall be set forth in the Agreement.10.2. Amount of Award. The value of each Other Stock Unit Award shall be based, in whole or in part, on the value of theunderlying Stock or other securities. The Agreement may provide that an Other Stock Unit Award may provide to theParticipant (a) dividends or dividend equivalents and (b) cash payments in lieu of or in addition to an Award.10.3. General Rules for Other Stock Unit Awards. Subject to the requirements of the Plan, including this Section 10.3, the terms, restrictions, conditions, vesting requirements, and payment rules of an Other Stock Unit Award(collectively, the “Rules”) shall be set forth in the Agreement. The Rules for each Other Stock Unit Award need not beconsistent from one Other Stock Unit Award to another.(a) An Other Stock Unit Award shall be subject to vesting conditions set forth in the applicable Agreement, whichmay be based on any criterion permitted by Section 8.2 (Vesting). Subject to Section 12.2, the minimum vestingperiod required by Section 8.2 shall also apply for Other Stock Unit Awards; provided that the minimum vestingperiod shall not apply for full value awards granted to Non-Employee Directors.(b) An Other Stock Unit Award may be contingent on the payment of cash consideration by the Participant ormay provide for delivery of the Award, and any Stock or other securities issued in conjunction with the Award,without any payment of cash consideration.(c) An Other Stock Unit Award may be subject to a deferred payment schedule, if so set forth in the Agreement.(d) The Administrator, in its sole and complete discretion, as a result of certain circumstances, including theassumption of, or substitution of stock unit awards of a company with which Avnet or a Subsidiary participates inan acquisition, separation, or similar corporate transaction, may waive or otherwise remove, in whole or in part,any restriction or condition imposed on an Other Stock Unit Award at the time of grant.ARTICLE 11EXECUTIVE INCENTIVE PERFORMANCE AWARDS11.1. EIP Awards. The Committee (and the CEO to the extent permitted by Section 4.6) may issue EIP Awards toEligible Employees who are Executive Officers or members of senior management of Avnet or of any of its Subsidiaries.Neither this Article 11 nor any other provision of the Plan shall limit in any way the authority of the CEO and otherCompany officers to issue incentive pay and cash bonuses to Eligible Employees who are not Executive Officers.11.2. Determination of EIP Amount. The amount of an EIP Award shall be determined by the Committee (or the CEO tothe extent permitted by Section 4.6) and shall be contingent upon the achievement of Performance Objectives specifiedby the Committee, as set forth in the Agreement. 11.3. Payment of Awards. EIP Awards shall be paid in cash after the Performance Period has ended and the Committeehas certified that the specified Performance Objectives were achieved. Except as otherwise expressly provided in anAgreement, payment shall be made no later than the end of the “applicable 2-½ month period” described in Treas. Reg. §1.409A-1(b)(4)(i)(A).11.4. Individual Limitation. The maximum individual EIP Award permitted for a 12-month Performance Period, is$5,000,000. If the Performance Period is not twelve (12) months, the $5,000,000 limitation shall be adjusted on a pro-rata basis (downward if the Performance Period is less than 12 months and upward if the Performance Period is more than12 months) to reflect the length of the Performance Period.ARTICLE 12ADDITIONAL TERMS AND PROVISIONS12.1. Agreements. Promptly after the granting of any Award or the modification of any outstanding Award, theAdministrator shall cause such Participant to be notified of such action and shall cause Avnet to deliver to suchParticipant an Agreement (which Agreement shall be signed on behalf of Avnet by an officer of Avnet with appropriateauthorization therefor) evidencing the Award so granted or modified and the terms and conditions thereof and including(when appropriate) an addendum evidencing the Award so granted or modified and the terms and conditions thereof.12.2. Acceleration of Vesting and Cancellation of Options and SARs. The Administrator, in its sole discretion, mayaccelerate the vesting of any Award (including the lapsing of the Period of Restriction for Restricted Stock), or removeconditions for vesting (or lapsing of the Period of Restriction) upon a Change in Control or the Participant’s death,retirement, layoff, separation from service in connection with a Change in Control, or other separation from servicewhere the Administrator determines that such treatment is appropriate and in the Company’s best interests, as well asupon assumption of, or in substitution for equity awards of a company with which Avnet or a Subsidiary participates inan acquisition, separation, merger, or similar corporate transaction; provided, however, that with respect to an Award to aCovered Participant that is intended to qualify as “other performance-based compensation,” waiver of performanceconditions shall be permitted only to the extent permitted by Revenue Ruling 2008-13 or any successor thereto. Inaddition, the Administrator may grant awards of Options, SARs, Restricted Stock, Restricted Stock Units, PerformanceShare Units and Other Stock Unit Awards that do not satisfy the minimum vesting periods and Periods of Restrictionprescribed by Sections 5.4, 6.4, 7.3, 8.2, 9.2, and 10.3(a), provided that the total number of shares of Stock underlyingAwards that do not satisfy such minimum vesting periods and Periods of Restriction shall not exceed five percent (5%) ofthe total number of shares available for grant under the Plan. In connection with a Change in Control, any Options orSARs may be canceled in exchange for the right (to the extent vested) to receive, at a time determined by theAdministrator, a cash payment equal to the excess, if any, of the fair market value of the Stock subject to the Option orSAR over the exercise price. For the avoidance of doubt, no payment shall be required with respect to any Option or SARfor which the exercise price exceeds the fair market value of the Stock at the time of the cancellation (i.e., an “underwater” option or SAR).12.3. Tax Withholding. The Company shall have the right to deduct from all amounts paid to a Participant or beneficiaryany taxes that it determines are required by law to be withheld in respect of Awards under the Plan. In the case of anAward settled in shares of Stock, no shares of Stock shall be issued, and no election under Section 83(b) of the Codeshall be accepted, unless and until arrangements satisfactory to the Company have been made to satisfy any applicablewithholding tax obligations. Without limiting the generality of the foregoing and subject to such terms and conditions asthe Committee may impose, the Company shall have the right to (a) retain shares of Stock or (b) subject to such termsand conditions as the Committee may establish from time to time, allow Participants or beneficiaries to (i) tender shares ofStock (including shares of Stock issuable in respect of an Award) to satisfy, in whole or in part, the amount required to bewithheld, or (ii) pay the required tax withholding amount to Avnet in cash; and the fair market value of shares of Stockwithheld may exceed the minimum statutory withholding requirements. For purposes of determining the number ofshares of Stock required to satisfy a tax withholding obligation, the fair market value shall be calculated as of the datethat the amount to be withheld is determined. Unless a Participant or beneficiary, as applicable, requests to pay Avnetcash for any fractional share that would otherwise be required to be withheld to satisfy a tax withholding obligation, thenumber of shares of Stock withheld by Avnet shall be rounded up to the nearest whole number. Regardless of the amountwithheld, each Participant and beneficiary shall be responsible at all times for paying all federal, state, and local incomeand employment taxes allocable to such Participant or beneficiary with respect to any Award (including taxes due withrespect to imputed income), and the Company shall not be responsible for any interest or penalty that a Participant incursby failing to make timely payments of tax. 12.4. No Right to Employment; No Right to Award. The Plan shall not confer upon any Participant or other individual anyright with respect to continuance of employment by the Company, or continuance of membership on the Board ofDirectors, nor shall it interfere in any way with his right, or the Company’s right, to terminate his employment or Boardmembership at any time. No provision of the Plan shall be construed to give any Eligible Employee or Non-EmployeeDirector a right to receive an Award.12.5. Shareholder Rights. Except as provided in Article 7 with respect to Restricted Stock, no Participant shall acquireor have any rights as a shareholder of Avnet by virtue of any Award until the shares of Stock issued pursuant to theAward or the exercise thereof are recorded in the books and records of Avnet in accordance with the terms of the Plan.Subsequent to such recordation in the books and records of Avnet, the recipient of shares of Stock shall have the fullrights of a holder of such Stock.12.6. Registration of Shares. It is Avnet’s present intention to register the shares of Stock issued pursuant to the Planunder the Securities Act as necessary. Avnet shall not be obligated to sell or deliver any shares of Stock pursuant to thegranting, vesting, or exercise of any Award unless and until—(a) either (i) Avnet has received from its counsel an opinion concluding that such shares need not be registeredunder the Securities Act, or (ii) (A) such shares have been registered under the Securities Act, (B) no stop ordersuspending the effectiveness of such registration statement has been issued and no proceedings therefor havebeen instituted or threatened under the Securities Act, and (C) there is available at the time of such grant, vestingevent, or exercise (as applicable) a prospectus containing certified financial statements and other informationmeeting the requirements of Section 10(a)(3) of the Securities Act;(b) such shares are (or upon official notice of issuance will be) listed on each national securities exchange onwhich the class of Stock is then listed;(c) if necessary, the prior approval of such delivery has been obtained from any State regulatory body havingjurisdiction (but nothing herein contained shall be deemed to require Avnet to register or qualify as a foreigncorporation in any State nor, except as to any matter or transaction relating to the sale or delivery of such shares,to consent to service of process in any State); and(d) if the Committee so requires, Avnet has received an opinion from its counsel with respect to compliance withthe matters set forth in subsections (a), (b), and/or (c) of this Section 12.6.In addition, the making of any Award or determination, the delivery or recording of a stock transfer, and payment of anyamount due to a Participant may be postponed for such period as Avnet may require, in the exercise of reasonablediligence, to comply with the requirements of any applicable law.12.7. Document Requirements. The Committee may require, as a condition of any payment or share issuance, that certainagreements, undertakings, representations, certificates, and/or information, as the Committee may deem necessary oradvisable, be executed or provided to the Company to assure compliance with all applicable laws.12.8. Deferrals. The Administrator may allow a Participant to elect to defer receipt of any payment of cash or anydelivery of shares of Stock that would otherwise be due to such Participant by virtue of the exercise, earn-out, orsettlement of any Award made under the Plan, other than Options or Stock Appreciation Rights. If such election ispermitted, the Committee shall establish rules and procedures for such deferrals, including provisions that the Committeeor the Participant determines are necessary or advisable to comply with, or avoid being subject to, the requirements ofSection 409A of the Code, and provisions for the payment or crediting of dividend equivalents in respect of deferralscredited in units of Stock.12.9. Recoupment. Each Award shall be subject to the terms and conditions of Avnet’s compensation recoupment orclawback policy, as in effect and amended from time to time, including disgorgement or repayment to the extent requiredby such policy (taking into account changes to such policy that are made after the date hereof and after the date of theapplicable Agreement). 12.10. Nontransferability. Except as otherwise provided in Section 7.7 (Foreign Laws), this Section 12.10, or theapplicable Agreement, no Award granted under the Plan, and no interests therein, may be sold, transferred, pledged,assigned, exchanged, encumbered or otherwise alienated or hypothecated; and each Award shall be exercisable duringthe Participant’s lifetime only by the Participant or his legal guardian or representative.(a) An Award may be transferred by testamentary disposition or the laws of descent and distribution.(b) The Committee shall have sole discretion to approve, and to establish terms and conditions for, a transfer ofan Option other than an Incentive Stock Option to (i) the child, step-child, grandchild, parent, stepparent,grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, sister-in-law, including adoptive relationships, and any person sharing the Participant’shousehold (other than a tenant or employee) of the Participant (an “Immediate Family Member”); (ii) a trust inwhich Immediate Family Members have more than 50% of the beneficial interest; (iii) a foundation in whichImmediate Family Members or the Participant control the management of the assets; or (iv) any other entity inwhich Immediate Family Members or the Participant own more than 50% of the voting interests (each (i) - (iv), a“Permitted Transferee”); provided, however, that, without the prior approval of the Committee, no PermittedTransferee shall further transfer an Award, either directly or indirectly, other than by testamentary disposition orthe laws of descent and distribution. For example, without prior approval of the Committee, a PermittedTransferee may not transfer an Award by reason of the dissolution of, or a change in the beneficiaries of, aPermitted Transferee that is a trust; the sale, merger, consolidation, dissolution, or liquidation of a PermittedTransferee that is a partnership (or the sale of all or any portion of the partnership interests therein); or the sale,merger, consolidation, dissolution or liquidation of a Permitted Transferee that is a corporation (or the sale of allor any portion of the stock thereof).(c) The Committee shall have discretion to authorize a transfer pursuant to a domestic relations order; provided,however, that the Committee shall not be required under any circumstance to accept or approve a transferpursuant to a domestic relations order.(d) An Award may be forfeited or transferred to the extent required to satisfy a tax levy or judgment under theMandatory Victims Restitution Act or similar federal or state law.12.11. Applicable Law and Severability. The Plan, and its rules, rights, agreements and regulations, shall be governed,construed, interpreted and administered solely in accordance with the laws of the state of New York, without regard toany conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of the Plan to thesubstantive law of another jurisdiction. If any provision of the Plan is held invalid, illegal, or unenforceable, in whole orin part, for any reason, such determination shall not affect the validity, legality or enforceability of any remainingprovision, portion of provision or the Plan overall, which shall remain in full force and effect as if such invalid, illegal orunenforceable provision (or portion thereof) had never been included in the Plan.12.12. Special Incentive Compensation. No shares of Stock or other remuneration provided pursuant to an Award, otherthan an EIP Award, shall be included in compensation for purposes of determining the amount payable to any individualunder any pension, savings, retirement, life insurance, or other employee benefits arrangement of the Company, unlessotherwise determined by the Company. Remuneration provided pursuant to an EIP Award shall be included incompensation to the extent (and only to the extent) required by the applicable employee benefits arrangement.12.13. Section 16(b) of the Exchange Act. All Agreements for Participants subject to Section 16(b) of the Exchange Actshall be deemed to include any such additional terms, conditions, limitations and provisions as Rule 16b-3 requires,unless the Committee in its discretion determines that any such Award should not be governed by Rule 16b-3. Inaddition, with respect to persons subject to Section 16(b) of the Exchange Act, transactions under the Plan are intended tocomply with all applicable conditions of Rule 16b-3. To the extent that any provision of the Plan or any action by theAdministrator fails to comply with Rule 16b-3, it shall be deemed null and void, to the extent permitted by law anddeemed advisable by the Committee.12.14. Section 162(m) of the Code. Each Award to a Covered Participant that is contingent upon the achievement ofPerformance Objectives shall be deemed to include any such additional terms, conditions, limitations, and otherprovisions as are necessary for such Award to qualify as “other performance-based compensation” within the meaning ofSection 162(m)(4)(C) of the Code, unless the Committee in its discretion determines that such Award is not intended toqualify as “other performance-based compensation.” Performance Objectives for each Award granted to a CoveredParticipant shall be measured over a stated Performance Period, on an absolute basis or relative to a pre-establishedtarget, as specified by the Committee and reflected in the Agreement. The Performance Objectives for each Award that isintended to qualify as “other performance-based compensation” shall be set forth in writing, at a time when achievementof the Performance Objectives is substantially uncertain, no later than the earlier of (a) 90 days after commencement of the period of service (within the meaning of Treas. Reg. §1.162-27(e)(2)(i)) to which the Performance Objectives relate, or (b) before 25 percent (25%) of such period of servicehas elapsed. To the extent permitted by Section 162(m)(4)(C) of the Code, the Committee may adjust performance resultsto take into account extraordinary, unusual, infrequently occurring, or non-comparable items, and shall have discretion toreduce (but not to increase) the amount due upon achievement of any Performance Objective. No amount shall be paid toa Covered Participant pursuant to an Award that is contingent upon the achievement of Performance Objectives unlessand until the Committee has certified that the Performance Objectives have been satisfied. To the extent required bySection 162(m) of the Code, canceled Awards shall continue to be counted against the limit set forth in Section 3.2 (Individual Limitations) on shares of Stock available for Awards.12.15. Section 409A of the Code. The Plan, any Award granted under the Plan, and all Agreements evidencing suchAwards, shall be interpreted, administered, and construed consistent with the intent that (a) all Options, SARs, andcomparable awards shall be exempt from Section 409A of the Code by reason of the exemption for certain stock rightsset forth in Treas. Reg. § 1.409A-1(b)(5); (b) all Awards of Restricted Stock shall be exempt from Section 409A of theCode by reason of the exemption for restricted property governed by Section 83 of the Code set forth in Treas. Reg. §1.409A-1(b)(6); and (c) except to the extent that the applicable Agreement reflects an intent to provide for nonqualifieddeferred compensation that is subject to and complies with the requirements of Section 409A of the Code, all RestrictedStock Unit Awards, Performance Share Unit Awards, Other Stock Unit Awards, and EIP Awards shall be exempt fromSection 409A of the Code by reason of the “short-term deferral rule” set forth in Treas. Reg. § 1.409A-1(b)(4).12.16. Application of Proceeds. The proceeds received by the Company from the sale of Stock under the Plan shall beused for general corporate purposes.12.17. Rules of Construction. Whenever used in the Plan, (a) words in the masculine gender shall be deemed to refer tofemales as well as to males; (b) words in the singular shall be deemed to refer also to the plural; (c) the word “include”shall mean “including but not limited to”; (d) references to a statute or regulation or statutory or regulatory provision shallrefer to that provision (or to a successor provision of similar import) as currently in effect, as amended, or as reenacted,and to any regulations and other formal guidance of general applicability issued thereunder; and (e) references to a lawshall include any statute, regulation, rule, court case, or other requirement established by an exchange or a governmentalauthority or agency, and applicable law shall include any tax law that imposes requirements in order to avoid adverse taxconsequences.12.18. Headings and Captions. The headings and captions in this Plan document are provided for reference andconvenience only, shall not be considered part of the Plan, and shall not be employed in the construction of the Plan.12.19. Effective Date. The Plan shall become effective on the date the Plan is approved by Avnet’s shareholders.ARTICLE 13ADJUSTMENTS UPON CHANGES IN CAPITALIZATION13.1. Share Adjustments. If the Stock is split, divided, or otherwise reclassified into or exchanged for a greater or lessernumber of shares of Stock or into shares of Stock and/or any other securities of Avnet by reason of recapitalization,reclassification, stock split or reverse split, combination of shares or other reorganization, the term “Stock” as used hereinshall thereafter mean the number and kind of shares or other securities into which the Stock shall have been so split,divided or otherwise reclassified or for which the Stock shall have been so exchanged; and the remaining number ofshares of Stock which may, in the aggregate, thereafter be delivered pursuant to the grant or exercise of an Award andthe remaining number of shares of Stock which may thereafter be delivered pursuant to the exercise of any Optionsand/or SARs then outstanding, shall be correspondingly adjusted. If a dividend payable in shares of Stock is paid to theholders of outstanding shares of Stock, the remaining number of shares of Stock which may, in the aggregate, thereafterbe delivered pursuant to the exercise or grant of Awards, and the remaining number of shares of Stock that maythereafter be delivered pursuant to the exercise of any Awards then outstanding shall be increased by the percentage thatthe number of shares of Stock so paid as a dividend bears to the total number of shares of Stock outstanding immediatelybefore the payment of such dividend. If an extraordinary cash dividend is paid to the holders of outstanding shares ofStock, the remaining number of shares of Stock that may, in the aggregate, thereafter be delivered pursuant to theexercise or grant of Awards and the remaining number of shares of Stock that may thereafter be delivered pursuant to theexercise of any Awards then outstanding, shall be equitably adjusted by the Committee. 13.2. Exercise Price Adjustments. If the Stock is split, divided or otherwise reclassified or exchanged, or if any dividendpayable in shares of Stock or extraordinary cash dividend is paid to the holders of outstanding shares of Stock, in eachcase, as provided in the preceding paragraph, the purchase price per share of Stock upon exercise of outstandingOptions, and the aggregate number of shares of Stock with respect to which Awards may be granted to any Participant inany calendar year, shall be correspondingly adjusted.13.3. Fractional Shares. Notwithstanding any other provision of this Article 13, if upon any adjustment made inaccordance with Section 13.1 above, the remaining number of shares of Stock which may thereafter be deliveredpursuant to the exercise of any Award then outstanding shall include a fractional share of Stock, such fractional share ofStock shall be disregarded for all purposes of the Plan and the Optionee holding such Award shall become entitledneither to purchase the same nor to receive cash or other property in payment therefor or in lieu thereof.ARTICLE 14AMENDMENT OR TERMINATION OF THE PLAN14.1. The Plan shall automatically terminate on November 30, 2026, unless it is sooner terminated pursuant to Section14.2, below. No Award shall be granted after the Plan terminates. All Awards granted before the Plan terminates shallcontinue in effect thereafter in accordance with the terms of the applicable Agreements and the Plan.14.2. Reservation of Rights. The Board of Directors may amend or terminate the Plan and/or any Award thereunder atany time as the Board of Directors may deem advisable and in the best interests of Avnet; provided, however, that—(i) a Participant’s written consent shall be required for any amendment to an outstanding Award that wouldadversely affect in a material manner the rights of such Participant under such Award, unless the Committeedetermines in its discretion that there have occurred or are about to occur significant changes in the Participant’sposition, duties or responsibilities, or significant changes in economic, legislative, regulatory, tax, accounting orcost/benefit conditions that the Committee determines in its sole discretion make Participant consent inappropriateunder the circumstances; and(ii) the affirmative vote of a majority of the votes cast at a meeting of the shareholders of Avnet duly called andheld for that purpose, shall be required for any change that (a) affects the composition or functioning of theCommittee; (b) materially increases the aggregate number of shares of Stock that may be delivered pursuant tothe exercise of Awards; (c) materially increases the aggregate number of shares of Stock with respect to whichOptions or other Awards may be granted to any Participant during any calendar year; (d) materially decreases theminimum purchase price per share of Stock (in relation to the Fair Market Value thereof at the respective dates ofgrant) upon the exercise of Options; (e) extends the ten-year maximum period within which an Award isexercisable or the termination date of the Plan; or (f) otherwise triggers a shareholder approval requirement underan applicable law or listing standard. Exhibit 10.13AVNET DEFERRED COMPENSATION PLAN(As Amended and Restated Effective as of May 8, 2018) TABLE OF CONTENTS Page ARTICLE 1 DEFINITIONS 2 1.1 “Account” or “Accounts” 2 1.2 “Active Participant” 2 1.3 “Affiliate” 2 1.4 “Beneficiary” or “Beneficiaries” 2 1.5 “Board of Directors” or “Board” 3 1.6 “Bonus” 3 1.7 “Business Day” 3 1.8 “Code” 3 1.9 “Committee” 3 1.10 “Company” 3 1.11 “Compensation” 3 1.12 “Compensation Deferral Election” 3 1.13 “Effective Date” 4 1.14 “Election Period” 4 1.15 “Eligible Employee” 4 1.16 “Employer” 4 1.17 “Final Section 409A Effective Date” 4 1.18 “Financial Hardship” 4 1.19 “Fund” or “Funds” 5 1.20 “Incentive Compensation” 5 1.21 “Interest Rate” 5 1.22 “Interim Section 409A Effective Date” 5 1.23 “Participant” 5 1.24 “Payment Eligibility Date” 5 1.25 “Plan” 6 1.26 “Plan Year” 6 1.27 “Salary” 6 1.28 “Section 409A Covered Benefits” 6 1.29 “Section 409A Disability” 6 1.30 “Section 409A Rules” 6 1.31 “Six Month Payment Delay Rule” 7 1.32 “Specified Employee” 7 1.33 “Target Compensation” 7 1.34 “Trust” 7 ARTICLE 2 PARTICIPATION 8 2.1 Participation 8 ARTICLE 3 DEFERRAL ELECTIONS 9 3.1 Elections to Defer Compensation 9 3.2 Investment Elections 10 ARTICLE 4 ACCOUNTS 12 4.1 Deferral Account 12 ARTICLE 5 VESTING 13 5.1 Deferral Account 13 ARTICLE 6 DISTRIBUTIONS 14 6.1 Distribution of Deferred Compensation 14 6.2 Financial Hardship Withdrawals 15 6.3 Unscheduled In-Service Withdrawal 16 6.4 Scheduled Early Distributions 16 6.5 Inability to Locate Participant 17 6.6 Trust 17 ARTICLE 7 ADMINISTRATION 18 7.1 Committee 18 7.2 Committee Action 18 7.3 Powers and Duties of the Committee 19 7.4 Construction and Interpretation 19 7.5 Information 20 7.6 Compensation, Expenses and Indemnity 20 7.7 Quarterly Statements 20 7.8 Disputes 20 ARTICLE 8 MISCELLANEOUS 23 8.1 Unsecured General Creditor 23 8.2 Restriction Against Assignment 23 8.3 Withholding 23 8.4 Amendment, Modification, Suspension or Termination 23 8.5 Governing Law 24 8.6 Receipt or Release 24 8.7 Notices 24 8.8 Headings and Gender 24 8.9 Plan Not A Contract of Employment 24 8.10 Construed as a Whole 24 8.11 Severability 25 AVNET DEFERRED COMPENSATION PLAN(As Amended and Restated Effective as of May 8, 2018) PREAMBLE Avnet, Inc., a New York corporation (the “Company”), previously adopted the Avnet DeferredCompensation Plan (the “Original Plan”) originally effective February 1, 1997 (the “Original Effective Date”).The Original Plan was last amended and restated effective as of January 1, 2001 into the Avnet DeferredCompensation Plan (As Amended and Restated Effective as of January 1, 2001) and thereafter amendedthrough the Third Amendment adopted on November 10, 2005 (the “Prior Plan”). The Company then amendedand restated the Prior Plan, effective generally as of January 1, 2009, to implement various design changes tothe Prior Plan and primarily to comply with Section 409A of the Code (as defined below). Accordingly, thePrior Plan became known as the Avnet Deferred Compensation Plan (As Amended and Restated EffectiveGenerally as of January 1, 2009) (the “Plan”). The Plan was further amended by the First Amendment, as filedwith the Securities and Exchange Commission on August 12, 2011. The Plan is further amended and restated asset forth herein. The Plan is intended to be a nonqualified deferred compensation plan under the Code that provides deferralof income to, and at the election of, a select group of management or highly compensated employees of anEmployer (as defined below). Accordingly, the Company intends that the Plan will not be a qualified retirementplan under Code Section 401(a), and that the Plan and Trust (as defined below) will be exempt from therequirements of parts 2, 3 and 4 of Title I of ERISA. Moreover, the Company intends that the terms of this Plandocument and the administration of the Plan and the Prior Plan shall be in compliance with the applicablerequirements under Code Section 409A. At no time during, or after, the Interim 409A Period (as defined below)were benefits deferred under the Prior Plan before the Interim 409A Period changed in such a manner as tocause a material modification of such benefits within the meaning of the Section 409A Rules. Moreover, allbenefits deferred under the Prior Plan were at all times fully vested. Accordingly, the Company intends that benefits which were deferred underthe Prior Plan before the Interim 409A Period and the earnings attributable thereto, are not subject to Codesection 409A.The Plan (and to the extent necessary the Prior Plan) shall be interpreted and construed so that benefitsdeferred under the Prior Plan or this Plan on and after the Interim 409A Period comply with the Section 409ARules. The Plan shall also be interpreted and construed so that benefits deferred under the Prior Plan before theInterim 409A Period are not subject to the Section 409A Rules. Any provision of the Plan that is found to beinconsistent with the foregoing shall be deemed to be severable from the terms of the Plan and shall have noforce or effect.ARTICLE 1 DEFINITIONS 1.1 “Account” or “Accounts” means a Participant’s Deferral Account and any subaccounts created underSection 4.1.1.2 “Active Participant” means a Participant who, for a particular Plan Year, has a Compensation DeferralElection in effect for the Plan Year.1.3 “Affiliate” means the Company and any other entity that is, or would be, aggregated and treated as asingle employer with the Company under Code sections 414(b) (controlled group of corporations) or 414(c) (agroup of trades or businesses, whether or not incorporated, under common control); provided, however, that anownership threshold of at least 50% shall be used hereunder instead of the 80% minimum ownership thresholdthat would otherwise apply under such Code sections.1.4 “Beneficiary” or “Beneficiaries” means the designated person(s) or entity(ies) to receive benefits in theevent of death of the Participant in accordance with procedures established by the Committee to receive thebenefits specified hereunder. No Beneficiary designation shall become effective until it is filed in accordancewith procedures approved by the Committee. If there is no such designation or if there is no survivingdesignated Beneficiary, then the Participant’s surviving spouse shall be the Beneficiary. If there is no survivingspouse to receive any benefits payable in accordance with the preceding sentence, the duly appointed andcurrently acting personal representative of the Participant’s estate (which shall include either the Participant’sprobate estate or living trust) shall be the Beneficiary. In any case where there is no such personalrepresentative of the Participant’s estate duly appointed and acting in that capacity within 90 days after theParticipant’s death (or such extended period as the Committee determines is reasonably necessary to allow suchpersonal representative to be appointed, but not to exceed 180 days after the Participant’s death), thenBeneficiary shall mean the person or persons who can verify by affidavit or court order to the satisfaction of theCommittee that they are legally entitled to receive the benefits specified hereunder. In the event any amount ispayable under the Plan to a minor, payment shall not be made to the minor, but instead be paid (a) to thatperson’s living parent(s) to act as custodian, (b) if that person’s parents are then divorced, and one parent is thesole or primary custodial parent, to such custodial parent, or (c) if no parent of that person is then living, to acustodian selected by the Committee to hold the funds for the minor under the Uniform Gifts to Minors Act orsimilar statute in effect in the jurisdiction in which the minor resides. If no parent is living and the Committeedecides not to select another custodian to hold the funds for the minor, then payment shall be made to the dulyappointed and currently acting guardian of the estate for the minor or, if no guardian of the estate for the minoris duly appointed and currently acting within 60 days after the date the amount becomes payable, payment shallbe deposited with the court having jurisdiction over the estate of the minor.1.5 “Board of Directors” or “Board” means the Board of Directors of the Company.1.6 “Bonus” means any amount of cash Compensation attributable to the Participant during a Plan Yearwhich is designated by the Company as a bonus payment and payable by the Company or an Employer. TheCommittee, in its discretion, shall determine whether any particular type or item of Compensation shall bedeemed a “Bonus” for purposes of the Plan or another type of Compensation; provided, however, that suchdiscretion may only be exercised during an Election Period preceding a Plan Year when a Bonus is earned.1.7 “Business Day” means a day during which The Nasdaq Global Select Market is open for trading.1.8 “Code” means the Internal Revenue Code of 1986, as amended.1.9 “Committee” means the Committee appointed by the Board to administer the Plan in accordance withArticle 7.1.10 “Company” means Avnet, Inc., a New York corporation, and any successor corporation or entity.1.11 “Compensation” means a Participant’s Incentive Compensation and/or Salary and/or Bonus; provided,however, that, effective with the 2008 Plan Year, Compensation shall not include payments made to aParticipant by an Employer in that are in the nature of severance payments.1.12 “Compensation Deferral Election” means a written or electronic election completed by the Participantto defer the payment of Compensation, subject to the terms and conditions of the Plan and such other rules,procedures and approvals that the Committee shall determine in its sole discretion. Except as otherwisespecifically allowed under the Section 409A Rules (as defined below), a Participant’s Compensation DeferralElection shall be irrevocable for the corresponding Plan Year and shall automatically carry-forward to futurePlan Years unless it is revoked or changed by a Participant during a corresponding Election Period. If aParticipant who has a Compensation Deferral Election in effect for the 2008 Plan Year does not have projectedCompensation of at least $150,000 for calendar year 2009, then such election shall cease as of December 31,2008 with respect to Salary and as of February 28, 2009 with respect to Incentive Compensation. Consistentwith the Section 409A Rules, if a Participant receives an unscheduled distribution of Section 409A CoveredBenefits due to a Financial Hardship, his or her Compensation Deferral Election shall be cancelled for theremainder of the Plan Year and such a Participant will be precluded from making another CompensationDeferral Election during the Election Period corresponding to the following Plan Year. Thereafter, theParticipant’s previous Deferral Election shall not apply and the Participant must make a new Deferral Electionduring the Election Period corresponding to the Plan Year when or she is again eligible to defer Compensationunder the Plan.1.13 “Effective Date” of this Plan generally means January 1, 2009, except as otherwise provided herein.Where a particular Plan provision has an effective date prior to January 1, 2009, the terms of the Prior Plan shallbe deemed to be amended accordingly.1.14 “Election Period” for an Eligible Employee means, with respect to a particular Plan Year, the openenrollment period designated by the Committee that ends no later than the last day of the calendar year (i.e., theDecember 31st) before the next Plan Year starts.1.15 “Eligible Employee” means any domestic U.S. domicile employee of an Employer who is part of aselect group of management or highly compensated employees that the Committee has determined to beeligible to become a Participant in the Plan and to whom the Plan is extended by the Committee, but excludingany person designated by the Company or an Affiliate as an independent contractor or a leased employee. Inaddition, effective for Salary earned after December 31, 2008 and Incentive Compensation earned afterFebruary 28, 2009, a person is any Eligible Employee only if he or she is projected to earn Compensation of atleast $150,000 from an Employer during a calendar year. Effective for Plan Years starting after December 31,2011No individual shall qualify as an Eligible Employee for a Plan Year unless the individual’s projectedCompensation for such Plan Year is no less than the following amount:(a) Effective for Plan Years ending before March 1, 2012, for Salary earned after December 31, 2008 and IncentiveCompensation earned after February 28, 2009, $150,000. (b) Effective for Plan Years starting after December 31, 2011, the limit prescribed by section 401(a)(17) of the Code forthe calendar year that ends during the Plan Year.1.16 “Employer” means the Company and any Affiliate that has adopted the Plan with the consent of theBoard or the Committee.1.17 “Final Section 409A Effective Date” means the date when a rule or requirement under the finalregulations issued by the Secretary of the Treasury became effective under Code Section 409A, and shallgenerally refer to January 1, 2009.1.18 “Financial Hardship” means an unforeseeable, severe financial emergency resulting from (1) a suddenand unexpected illness or accident of the Participant or his or her dependent (as defined in Section 152(a) of theCode); (2) loss of the Participant’s property due to casualty; or (3) other similar extraordinary and unforeseeablecircumstances arising out of an event beyond the control of the Participant, which may not be relieved throughother available resources of the Participants, as determined by the Committee in its sole discretion.Notwithstanding the foregoing, for distributions attributable to Section 409A Covered Benefits, a FinancialHardship must qualify as an “unforeseeable emergency” under the Section 409A Rules relating to theParticipant or his or her dependent or designated Beneficiary under the Plan.1.19 “Fund” or “Funds” means one or more of the investment funds selected by the Committee pursuant toSection 3.2(a) in which a Participant’s Account shall be deemed to be invested.1.20 “Incentive Compensation” means any cash incentive compensation payable to a Participant by theCompany or an Employer in addition to the Participant’s Salary and Bonus prior to reduction for any salarydeferral contributions to a plan described under Section 125 or Section 401(k) of the Code.1.21 “Interest Rate” means, for each Fund, an amount equal to the net rate of gain or loss on the assets ofsuch Fund as of the close of each Business Day, as determined by the Fund (this amount may be a negativenumber); provided, however, that the Interest Rate for that portion of a Participant’s Account scheduled for adistribution shall mean, for each Fund, an amount equal to the net rate of gain or loss on the assets of such Fundas of the close of the last Business Day of the calendar month before the scheduled distribution date and, if onlya partial distribution is being made, the remaining balance of the Participant’s Account shall be adjusted for theInterest Rate effective as of the first Business Day of the following month.1.22 “Interim Section 409A Effective Date” means mean the date when a particular provision or rulepromulgated under Code Section 409A became effective, and shall generally mean January 1, 2005. The term“Interim Section 409A Period” means the period beginning on or after the Interim Section 409A Effective Dateand ending immediately before the Final Section 409A Effective Date.1.23 “Participant” means any Eligible Employee who becomes a Participant in accordance with Section 2.1. 1.24 “Payment Eligibility Date” means a date as soon as administratively practical during the periodbeginning on the first Business Day of the month following the date when a Participant incurs a distributionevent under the Plan and ending on a date that does not exceed 90 days thereafter (as determined by theCommittee). Notwithstanding the foregoing, for distributions of Section 409A Covered Benefits to Participantswho are Specified Employees (as defined below) subject to the Six Month Payment Delay Rule (as definedbelow), the term Payment Eligibility Date means a date as soon as administratively practical during the periodbeginning on the first Business Day of the seventh full month following the Participant’s separation fromservice (under the Section 409A Rules) and ending on a date that does not exceed 90 days thereafter (asdetermined by the Committee). (For the avoidance of doubt, if the 90 day period covers two calendar years, theParticipant may not designate the calendar year of the payment).1.25 “Plan” means this Avnet Deferred Compensation Plan (As Amended and Restated Effective Generallyas of January 1, 2009) set forth herein, now in effect, or as amended from time to time.1.26 “Plan Year” means: (i) prior to January 1, 2008, the calendar year; (ii) effective January 1, 2008, the14 month period beginning January 1, 2008 and ending on February 28, 2009; and (iii) thereafter, the 12month period beginning each March 1st and ending on the last day of the February in the following year.1.27 “Salary” means the Participant’s base salary payable by the Company or an Employer to a Participantin cash prior to reduction for any salary deferral contributions to a plan qualified under Section 125 or Section401(k) of the Code. The term “Salary” shall exclude any Bonuses (or other extraordinary compensation-relatedpayments), reimbursements of business, moving and other expenses, any income resulting from stock optionexercises, any Incentive Compensation and any distributions from the Plan and/or any other qualified or non-qualified deferred compensation plan. The Committee, in its discretion, shall determine whether any particulartype or item of compensation not specifically referred to above shall be deemed “Salary” for purposes of thePlan; provided, however, that such discretion may only be exercised during an Election Period preceding a PlanYear when the Salary is earned..1.28 “Section 409A Covered Benefits” means that portion of a Participant’s Account attributable to deferralsmade on or after the Interim Section 409A Period as adjusted for any earnings or losses attributable thereto and,if applicable, amounts that are deferred before the Interim Section 409A Effective Date that were materiallymodified within the meaning of the Section 409A Rules.1.29 “Section 409A Disability” means, with respect to Section 409A Covered Benefits, that a Participant isunable to engage in any substantial gainful activity due to a medically determinable physical or mentalimpairment that can be expected to result in death or last for a continuous period of not less than 12 months, asdetermined in accordance with the Section 409A Rules.1.30 “Section 409A Rules” means the terms and provisions of Section 409A of the Code and the generalrules and regulations issued thereunder by the Secretary of the Treasury, the Commissioner of the InternalRevenue Service and their respect delegates.1.31 “Six Month Payment Delay Rule” means the requirement under Code Section 409A that a SpecifiedEmployee must delay his or her distribution of Section 409A Covered Benefits from a “nonqualified deferredcompensation plan” (within the meaning of the Section 409A Rules) for six (6) months after Separation FromService, but subject to applicable exceptions under the Section 409A Rules for distributions due to death or aSection 409A Disability.1.32 “Specified Employee” means a Participant who is considered to be a “key employee” under CodeSection 416(i) determined in accordance with procedures consistent with the Section 409A Rules. Withoutlimiting the generality of the foregoing, a Participant’s status as a key employee shall be based on each calendaryear, beginning with the calendar year preceding the Interim Section 409A Effective Date and, if the Participantis then a key employee, the Participant shall be considered to be a Specified Employee for the 12-month periodbeginning on the April 1st following the end of the calendar year when he or she was determined to be a keyemployee.1.33 “Target Compensation” means, for a Plan Year, a Participant’s Incentive Compensation and Salary.1.34 “Trust” means the Avnet Deferred Compensation Rabbi Trust, as amended from time to time.ARTICLE 2 PARTICIPATION 2.1 Participation. Each person who was a “Participant” under the Prior Plan immediately prior to theEffective Date shall continue to be a Participant in the Plan, but subject to the terms and conditions of the Plan.Any other person who is an Eligible Employee shall become a Participant in the Plan by (A) electing to defer aportion of his or her Compensation in accordance with Section 3.1, and/or (B) completing such other forms oragreements that the Committee, in its sole discretion, may require.If an employee ceases to be an Eligible Employee, then he or she shall no longer be an Active Participanteligible to have a valid Compensation Deferral Election on file with the Committee for future Plan Years untilhe or she becomes an Eligible Employee again and subsequently reenrolls in the Plan during an Election Period.ARTICLE 3 DEFERRAL ELECTIONS 3.1 Elections to Defer Compensation. (a) Election Period. Subject to Section 2.1, each Eligible Employee may elect to defer Compensation byfiling with the Committee (or a third party designated by the Committee) a Compensation Deferral Election nolater than the last day of the Election Period for the corresponding Plan Year; provided, however, that anEligible Employee may elect to change his or her Compensation Deferral Election for the 2005 Plan Year byMarch 15, 2005, but only for Compensation that has not yet been paid as of that date.(b) General Rule. The amount of Compensation which an Active Participant may elect to defer is asfollows:(1) Any amount of Salary that is at least 5%, and does not exceed 50%, of his or her Salary; and/or(2) Any amount of Incentive Compensation that is at least 10%, and does not exceed 100%, of his orher Incentive Compensation; and/or(3) Any amount of Bonus that is at least 10%, and does not exceed 100%, of Bonus provided,however, that no election shall be effective to reduce Compensation that:(i) an Eligible Employee has actually or constructively received; or(ii) would cause an Eligible Employee’s Compensation for a calendar year to be an amount whichis less than the Social Security taxable wage base for such calendar year.(c) Coordination With Deferrals to Avnet 401(k) Plan. An Active Participant who makes a validCompensation deferral election under paragraph (b) above for a Plan Year may also elect, during his or herapplicable Election Period, to have certain amounts attributable to pre-tax contributions that would, absentcertain limitations under the Code, otherwise be made to the Avnet 401(k) Plan be made or transferred to thisPlan. These amounts include refunds attributable to the nondiscrimination tests under Code sections 401(k) or401(m). Any amounts deferred under the Plan pursuant to this paragraph (c) shall be treated as deferral ofSalary for all other purposes of the Plan. Notwithstanding the foregoing, an Active Participant’s ability to defercontributions to the Plan attributable to such refunds from the Avnet 401(k) Plan after December 31, 2004 shallbe subject to the Section 409A Rules.(d) Effect of Election. The Compensation Deferral Election shall be effective with respect toCompensation payable during or after the first pay period beginning with the Plan Year following the ElectionPeriod. (e) Duration of Compensation Deferral Election. Any Compensation Deferral Election shall remain ineffect, notwithstanding any change in the Participant’s Compensation, until changed or terminated inaccordance with the terms of paragraph (f). Subject to the preceding requirements, a Participant may increase,decrease or terminate his or her Compensation Deferral Election, effective for Compensation payable duringpay periods beginning in the Plan Year beginning after the corresponding Election Period during which the newCompensation Deferral Election is filed with the Committee.(f) Revocation of Compensation Deferral Election. Except to the extent specifically permitted under theSection 409A Rules, a Participant’s Compensation Deferral Election made during an Election Period isirrevocable once that Election Period ends and may not be changed until the following Election Period. Exceptas otherwise required under the Section 409A Rules, a Participant who is rehired during a Plan Year afterincurring a termination of employment with the Company during that Plan Year shall remain subject to theterms of his or her Compensation Deferral Election in place (if any) for that Plan Year. Notwithstanding theforegoing, a Participant who receives a Financial Hardship Withdrawal during a Plan Year pursuant to Section6.2 shall be deemed to have his or her Compensation Deferral Election revoked for the duration of such PlanYear and shall not be eligible to file a new Compensation Deferral Election with the Committee for the nextPlan Year.(g) Elections other than Elections During the Election Period. A Participant may only file aCompensation Deferral Election during an Election Period. If an individual becomes an Eligible Employeeduring a Plan Year after the corresponding Election Period has expired, he or she will not be eligible to becomea Participant, and accordingly will not be eligible to file a Compensation Deferral Election, until the nextfollowing Election Period (with such election to be effective as of the next following Plan Year).3.2 Investment Elections. (a) At the time of making the deferral elections described in Section 3.1, the Participant shall designate,in such manner as prescribed by the Committee, the type(s) of investment funds the Participant’s Account willbe deemed to be invested in for purposes of determining the amount of earnings to be credited to that Account.These investment funds shall be selected by the Committee from time to time, and the Committee may modify,replace or discontinue a particular type or category of investment fund in its sole discretion.(b) In making the designation pursuant to this Section 3.2, the Participant may specify that all or anywhole percentage of his Accounts (of at least 1%) be deemed to be invested in one or more of the types ofinvestment funds available under the Plan from time to time. A Participant may change the designation madeunder this Section 3.2 by filing a change of election in such manner as specified by the Committee. The changewill be effective on the first Business Day following the Business Day when the Participant submits his or herchange of investment election (or as soon as practicable thereafter). Notwithstanding the foregoing, no newinvestment election may be made with respect to amounts in a Participants Account scheduled for distributionafter the second to last Business Day of the month preceding the month in which such distribution is scheduledto be made. If a Participant fails to elect a type of fund under this Section 3.2, he or she shall be deemed to haveelected an investment fund that is similar to a money market fund.(c) The Interest Rate of each such commercially available investment fund or contract shall be used todetermine the amount of earnings or losses to be credited to Participants’ Accounts under Article 4.ARTICLE 4 ACCOUNTS 4.1 Deferral Account. The Committee shall establish and maintain a Deferral Account for each Participantunder the Plan. Each Participant’s Deferral Account shall be further divided into separate subaccounts (“FundSubaccounts”), each of which corresponds to a investment fund(s) elected by the Participant pursuant to Section3.2(a). Without limiting the generality of the foregoing, separate Fund Subaccounts shall be maintained for all Participants attributable to their Compensation deferrals made prior to January 1, 2005 (including those madeunder the Memec, LLC Executive Deferred Compensation Plan (the “Memec Plan”)) and, for those Participantswhose benefits were merged into this Plan from the Memec Plan, for amounts deferred under the Memec Planduring the 2005 calendar year. A Participant’s Deferral Account shall be credited as follows:(a) As soon as practicable after the date that Salary being deferred hereunder would otherwise bepayable to the Participant, the Committee shall credit the Fund Subaccounts of the Participant’s DeferralAccount with an amount equal to Salary deferred by the Participant during each pay period in accordance withthe Participant’s election under Section 3.2(a); that is, the portion of the Participant’s deferred Salary that theParticipant has elected to be deemed to be invested in a certain type of investment fund shall be credited to theFund Subaccount corresponding to such fund;(b) As soon as practicable after the date that Incentive Compensation being deferred hereunder wouldotherwise be payable to the Participant, the Committee shall credit the Fund Subaccounts of the Participant’sDeferral Account with an amount equal to the portion of the Incentive Compensation deferred by theParticipant’s election under Section 3.2(a); that is, the portion of the Participant’s deferred IncentiveCompensation that the Participant has elected to be deemed to be invested in a particular type of investmentfund shall be credited to the Fund Subaccount corresponding to such fund;(c) As soon as practicable after the date that Bonus being deferred hereunder would otherwise bepayable to the Participant, the Committee shall credit the Fund Subaccounts of the Participant’s DeferralAccount with an amount equal to the portion of the Bonus money deferred by the Participant’s election underSection 3.2(a); that is, the portion of the Participant’s deferred Bonus money that the Participant has elected tobe deemed to be invested in a particular type of investment fund shall be credited to the Fund Subaccountcorresponding to such fund; and(d) As of the end of each Business Day, each Fund Subaccount of a Participant’s Deferral Account shallbe credited with earnings or losses in an amount equal to that determined by multiplying the balance credited tosuch Fund Subaccount as of the end of the preceding Business Day by the Interest Rate for the correspondinginvestment fund selected by the Committee pursuant to Section 3.2(b). ARTICLE 5 VESTING 5.1 Deferral Account. Except as provided in Sections 6.4 and 6.5, a Participant’s Deferral Account shall be100% vested at all times.ARTICLE 6 DISTRIBUTIONS 6.1 Distribution of Deferred Compensation. (a) General Distribution Rules. In the case of a Participant who is no longer employed by the Companyor an Affiliate and who either (i) terminates employment as a result of a long-term disability (as defined in theCompany’s long-term disability plan), or (ii) who has at least five (5) years of service with the Company or anAffiliate, the Participant’s Account shall be paid to the Participant in the form of substantially equal annualperiodic payments over 15 years beginning on his or her Payment Eligibility Date. However, except asindicated below with respect to Section 409A Covered Benefits, a Participant described in the precedingsentence may elect one of the following optional forms of distribution provided, that, if the distribution relatesto clause (ii) above, his or her election is filed with the Committee at least one year prior to his or hertermination of employment: (1) a cash lump sum payable on the Participant’s Payment Eligibility Date, and(2) substantially equal annual periodic payments over five or ten years beginning on the Participant’sPayment Eligibility Date.Distributions attributable to a Participant’s Fund Subaccount relating to the merger of the Memec Planinto this Plan shall be based on the distribution form or forms applicable to such Participant under the MemecPlan prior to such merger.(b) Plan Year Distribution Elections for Section 409A Covered Benefits. Notwithstanding the foregoing,for distributions attributable to Section 409A Covered Benefits, a Participant’s ability to select a distributionoption under clauses (1) or (2) above shall be determined in accordance with Section 409A Rules. Withoutlimiting the generality of the foregoing, a Participant could select a distribution option under (1) or (2) aboveduring an Election Period for deferrals (and earnings) made during the corresponding Plan Years beginning onor after the Interim Section 409A Effective Date and such distribution election shall apply to deferrals made infuture Plan Years unless and until the Participant makes a new, prospective distribution election for deferralsmade in future Plan Years during the corresponding Election Period.(c) Changing Distribution Elections for Section 409A Covered Benefits. If a Participant wants to changea distribution election for Section 409A Covered Benefits, the change will only be effective if it is made at least12 months in advance of the scheduled payment date, the change to such distribution election option does nottake effect until at least 12 months after the date on which the election is made, the first payment with respect towhich such election is made is deferred for at least five years from the date the payment would otherwise havebeen made and, except as allowed under the Section 409A Rules, the distribution election change does notpermit the acceleration of the time or schedule of any payment under the Plan. However, the foregoingrestrictions shall not apply to any distribution election change for Section 409A Covered Benefits if: (i) theParticipant submits a new distribution election by December 1, 2008 and (ii) any such distribution electionchange does not result in a distribution being postponed for the calendar year in which the distribution changeis filed. A Participant may change a distribution election made for Section 409A Covered Benefits only onceafter December 1, 2008.(d) Mandatory Lump Sum Distributions. Notwithstanding the foregoing provisions of this Article 6 orthe terms of a Participant’s distribution election: (i) if the Participant’s Account is $50,000 or less at his or hertermination of employment (or, with respect to Section 409A Covered Benefits payable by reason of a Section409A Disability, at his or her Payment Eligibility Date, as defined in subsection (g), below), the Participant’sAccount shall automatically be distributed in the form of a cash lump sum on the Participant’s PaymentEligibility Date; (ii) all payments made to a Beneficiary shall be in the form of a cash lump sum payment that ismade no later than the 90 days after the Participant’s date of death (as determined by the Committee and, for theavoidance of doubt, if the 90 day period covers two calendar years, the Beneficiary may not designate thecalendar year of the payment) even if periodic payments began before the Participant’s death; and (iii) subjectto the disability provisions of Section 6.1(a) and (g), if a Participant terminates employment prior to completingat least five (5) years of service with the Company or an Affiliate, the Participant’s distribution shall be in theform of a cash lump sum on the Participant’s Payment Eligibility Date.(e) Installment Distributions and Fund Accounts. Distributions made in installment payments will bedeemed to be made on a pro rata basis from each Fund Subaccount in which a Participant’s Account is deemedto be invested in pursuant to Section 3.2. The Participant’s Account shall continue to be adjusted for Interest inaccordance with the applicable provision of Article 4 of the Plan up until the last Business Day of the monthpreceding each installment distribution.(f) Termination of Employment. For all purposes under this Plan, a Participant shall not be consideredterminated from employment if the Participant remains employed by the Company or an Affiliate, even ifemployees of such Affiliate are not Eligible Employees. However, if the Participant is employed by theCompany or an Affiliate and ceases to be such as a result of a sale or other corporate reorganization, such saleor reorganization shall be treated as termination of employment unless immediately following such event andwithout any break in employment the Participant remains employed by Company or another Affiliate or theformer Affiliate assumes all liability for the Participant’s benefits under the Plan. Notwithstanding the foregoing,for distributions attributable to Section 409A Covered Benefits, the determination of whether a Participant hasterminated employment shall be consistent with the concept of “separation from service,” as that term is usedunder Section 409A Rules.(g) Disability. With respect to Section 409A Covered Benefits, the provisions of Section 6.1(a) that relateto a “long-term disability” apply only in the event of a Section 409A Disability. The Payment Eligibility Datefor a Participant who is “no longer employed” because he “terminates employment as a result of a long-termdisability,” within the meaning of clause (i) of Section 6.1(a), is the first anniversary of the Participant’scommencement of short-term disability benefits by reason of a Section 409A Disability, without regard towhether or when the Participant’s employment with the Company and Affiliates terminates. In the event of aSection 409A Disability, subject to subsection (d) (Mandatory Lump Sum Distributions), above, theParticipant’s Section 409A Covered Benefit shall be paid in the form elected by the Participant under Section6.1(b) (or, if the Participant has not made an election under Section 6.1(b), in annual installments over 15years). In accordance with Section 6.1(a), if a Participant’s Account is distributed because of a Section 409ADisability, the Participant is not required to satisfy the five (5) years of service condition to receive hisdistribution in installments.6.2 Financial Hardship Withdrawals. Participant shall be permitted to elect to withdraw amounts from theirAccounts prior to termination of employment with the Company or an Affiliate due to a Financial Hardshipsubject to the following restrictions:(a) The election to take a Financial Hardship distribution shall be made by filing an application with, andin such manner as approved by, the Committee prior to the end of any calendar month.(b) The Committee determines, in its sole discretion, that the Participant has incurred a FinancialHardship.(c) The amount of the Financial Hardship distribution shall, in all cases, not exceed the amountnecessary to satisfy the Financial Hardship (after taking into account the extent to which such hardship is ormay be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of theParticipant’s assets unless any such liquidation would itself cause a Financial Hardship) plus any taxesreasonably anticipated as a result of such distribution.(d) The amount described in subsection (c) above shall be paid in a single cash lump sum as soon aspracticable after the end of the calendar month in which the Committee approves the Financial Hardshipdistribution application.(e) To the extent permissible under Section 409A of the Code and the rules and regulations issuedthereunder, if a Participant receives a Financial Hardship Distribution, his or her Compensation deferrals shallbe cancelled for the balance of that Plan Year and one full Plan Year or such other period as may be requiredunder the Section 409A Rules.6.3 Unscheduled In-Service Withdrawal. Notwithstanding anything in this Plan to the contrary, for amountsattributable to deferrals made under the Plan prior to the Interim Section 409A Effective Date that are notSection 409A Covered Benefits, a Participant may request to withdrawal of all or a portion of the balance of hisAccount (other than any Section 409A Covered Benefits) by filing a request with, and in such manner asapproved by, the Committee. The withdrawal will be deemed to be made from the deferrals for the year or yearswhose deferred distribution date is closest to the date of the withdrawal and the Committee, in its solediscretion, shall determine which of the Fund Subaccounts will be charged for the withdrawal. This request maybe granted, solely in the absolute discretion of the Committee; provided, however, if the Committee grants awithdrawal request, the Participant will not be able to make Compensation deferrals during the next full PlanYear. The amount of the withdrawal under this section will be subject to a ten percent (10%) forfeiture. Such amount will be forfeited tothe Company.6.4 Scheduled Early Distributions. Participants may elect to receive payments of Compensation deferredduring a given Plan Year to be made on a future designated payment date while still employed by filing awritten election with the Committee during the Election Period corresponding to such Plan Year, provided thepayment date is at least three plan years from the date that the Compensation Deferral Election applicable tosuch Plan Year is received by the Committee. A Participant may change his or her payment date consistent withthe rules in Section 6.1(a) and (c) (as applicable) and, after December 1, 2008, many make only one irrevocableelection to postpone such payment date (and may only make one election to postpone such a payment.Payment under this Section will be made in a lump sum. This election shall apply to the Compensation deferredfor the Plan Year specified by the Participant on his or her payment election and the earnings credited theretountil the payment date. A distribution pursuant to this Section 6.4 of less than the Participant’s entire interest inthe Plan shall be made pro rata from his or her Fund Subaccounts according to the balances in suchSubaccounts. Notwithstanding the foregoing, if a Participant terminates employment with the Company for anyreason prior to the date on which a payment is scheduled to be made pursuant to this Section 6.4, theParticipant’s entire Account balance will be paid pursuant to the provisions of Section 6.1. 6.5 Inability to Locate Participant. In the event that the Committee is unable to locate a Participant orBeneficiary within two years following the Participant’s Payment Eligibility Date, the amount allocated to theParticipant’s Deferral Account and Company Contribution Amounts shall be forfeited. If, after such forfeiture,the Participant or Beneficiary later claims such benefit prior to the expiration of a ten year period, such benefitshall be reinstated without interest or earnings.6.6 Trust. (a) The Company may cause the payment of benefits under this Plan to be made in whole or in part bythe Trustee of the Trust (the “Trustee”) in accordance with the provisions of this Section 6.6. The Companyshall contribute to the Trust for each Participant an amount equal to the amount deferred by the Participant forthe Plan Year except to the extent that the Company determines that the Trust otherwise has sufficient assets toprovide allocations to Participants’ Accounts. Contributions required shall be made no less frequently than on amonthly basis.(b) The Committee shall direct the Trustee to pay the Participant or his Beneficiary at the time and in theamount described in Article 6. In the event the amounts held under the Trust are not sufficient to provide thefull amount payable to the Participant, the Company shall pay for the remainder of such amount at the time setforth in Article 6. In the event that the Company makes a distribution to a Participant from Company assets, theCompany may, in its discretion, cause the Trust to reimburse the Company.(c) Solely with respect to assets transferred to, or reserved under, the Trust after August 17, 2006 (the“Restriction Period Assets”) for a Participant who is also is an Applicable Covered Employee (as definedbelow), the Company may direct that Compensation deferred hereunder will not be held in the Trust by makinga good faith determination that a Restriction Period (as defined below) is reasonably expected to occur at anytime during the next nine months following the date when it provides at least 15 days advanced written noticeto the Participant of such determination. The Company may direct the Trustee to transfer any Restriction PeriodAssets in the Trust back to the Company within 15 days following the end of the Company’s 15 day advancednotification period. Thereafter, the payment obligations to the Participant hereunder attributable to theRestriction Period Assets shall no longer be an obligation of the Trust, but shall remain an obligation of theCompany which shall assume all of the duties and responsibilities of the Trust hereunder with respect to suchassets. As determined in accordance with section 409A(b)(3) of the Code and applicable Treasury regulations, aRestriction Period means, with respect to any single-employer defined benefit pension plan maintained by anEmployer, one of the following: (1) Any period during which such a plan is in at-risk status under section 430(i) of the Code;(2) Any period during which an Employer that is a plan sponsor of such a plan is a debtor in a caseunder Title 11 of the United States Code, or similar Federal or state law; or(3) The 12-month period beginning on the date which is six months before the termination date ofsuch a plan if, as of the termination date, the plan’s assets are not sufficient to cover all of the plan’s benefitliabilities (as determined under section 4041 of the ERISA .As determined under section 409(A)(b)(3)(D) and applicable Treasury regulations, a Participant is anApplicable Covered Employee if he or she is an employee of an Employer described in section 162(m)(3) ofthe Code or subject to the requirements of section 16(a) of the Exchange Act or was such an employee at thetime of termination of employment with an Employer.ARTICLE 7 ADMINISTRATION 7.1 Committee. A Committee shall be appointed by, and serve at the pleasure of, the Board of Directors.The number of members comprising the Committee shall be determined by the Board which may, from time totime, vary the number of members. A member of the Committee may resign by delivering a written notice ofresignation to the Board. The Board may remove any member by delivering a certified copy of its resolution ofremoval to such member. Upon his or her termination of employment with the Company, a person shallautomatically cease being a Committee member. Vacancies in the membership of the Committee shall be filledpromptly by the Board.7.2 Committee Action. The Committee shall act at meetings by affirmative vote of a majority of themembers of the Committee. Any action permitted to be taken at a meeting may be taken without a meeting if,prior to such action, a written consent to the action is signed by all members of the Committee and such writtenconsent is filed with the minutes of the proceedings of the Committee. A member of the Committee shall notvote or act upon any matter which relates solely to himself or herself as a Participant. The Chairman or anyother member or members of the Committee designated by the Chairman may execute any certificate or otherwritten direction on behalf of the Committee. Notwithstanding the foregoing, the Committee may delegatespecific functions or duties to a specific Committee member or members.7.3 Powers and Duties of the Committee. (a) The Committee shall enforce the Plan in accordance with its terms, shall be charged with the generaladministration of the Plan, and shall have all powers necessary to accomplish its purposes, including, but not byway of limitation, the following:(1) To select the funds or contracts to be the Funds in accordance with Section 3.2; (2) To construe and interpret the terms and provisions of this Plan and to remedy any ambiguities,omissions or inconsistencies contained therein;(3) To compute and certify to the amount and kind of benefits payable to Participants and theirBeneficiaries;(4) To maintain all records that may be necessary for the administration of the Plan;(5) To provide for the disclosure of all information and the filing or provision of all reports and statements to Participants, Beneficiaries or governmental agencies as shall be required by law;(6) To promulgate, administer and enforce such rules for the regulation of the Plan and proceduresfor the administration of the Plan as are not inconsistent with the terms hereof;(7) To appoint a plan administrator or any other agent, and to delegate to them such powers andduties in connection with the administration of the Plan as the Committee may from time to time prescribe;and(8) To take all actions set forth in the Trust agreement, including determining whether to hold ordiscontinue the Policies.7.4 Construction and Interpretation. The Committee shall have full discretion to construe and interpret theterms and provisions of this Plan, which interpretation or construction shall be final and binding on all parties,including, but not limited to, an Affiliate or any Participant or Beneficiary. The Committee shall administer suchterms and provisions of the Plan in accordance with any and all laws applicable to the Plan.7.5 Information. To enable the Committee to perform its functions, the Company shall supply full andtimely information to the Committee on all matters relating to the Compensation of all Participants, their deathor other cause of termination, and such other pertinent facts as the Committee may require.7.6 Compensation, Expenses and Indemnity. (a) The members of the Committee shall serve without compensation for their services hereunder.(b) The Committee is authorized at the expense of the Company to employ such legal counsel as it maydeem advisable to assist in the performance of its duties hereunder. Expenses and fees in connection with theadministration of the Plan shall be paid by the Company, to the extent that the Committee does not authorizepayment from the Trust.(c) To the extent permitted by applicable law, the Company shall indemnify and save harmless theCommittee and each member thereof, the Board of Directors and any delegate of the Committee who is anemployee of the Company against any and all expenses, liabilities and claims, including legal fees to defendagainst such liabilities and claims arising out of their discharge in good faith of responsibilities under or incidentto the Plan, other than expenses and liabilities arising out of willful misconduct. This indemnity shall notpreclude such further indemnities as may be available under insurance purchased by the Company or providedby the Company under any bylaw, agreement or otherwise, as such indemnities are permitted under applicablelaw.7.7 Quarterly Statements. Under procedures established by the Committee, a Participant shall have onlineaccess to a statement summarizing such Participant’s Accounts on a quarterly basis as soon as practicable aftereach March 31, June 30, September 30 and December 31 of each year.7.8 Disputes. (a) Claim. A person who believes that he or she is being denied a benefit to which he or she is entitledunder this Agreement (hereinafter referred to as “Claimant”) may file a written request for such benefit with theCommittee, setting forth his or her claim.(b) Claim Decision. Upon receipt of a claim, the Committee shall advise the Claimant that a reply will beforthcoming within ninety (90) days and shall, in fact, deliver such reply within such period. The Committeemay, however, extend the reply period for an additional ninety (90) days for special circumstances.If the claim is denied in whole or in part, the Committee shall inform the Claimant in writing, using language calculated to be understood by the Claimant, setting forth: (1) the specified reason or reasons for suchdenial; (2) the specific reference to pertinent provisions of the Plan or Plan rules on which such denial is based;(3) a description of any additional material or information necessary for the Claimant to perfect his or her claimand an explanation why such material or such information is necessary; (4) appropriate information as to thesteps to be taken if the Claimant wishes to submit the claim for review; and (5) the time limits for requesting areview under subsection (c).(c) Request for Review. Within sixty (60) days after the receipt by the Claimant of the written opiniondescribed above, the Claimant may request in writing that the Company review the determination of theCommittee. Such request must be addressed to the Secretary of the Company, at its then principal place ofbusiness. The Claimant or his or her duly authorized representative may, but need not, review the pertinentdocuments and submit issues and comments in writing for consideration by the Company. If the Claimant doesnot request a review within such sixty (60) day period, he or she shall be barred and estopped from challengingthe Company’s determination.(d) Review of Decision. Within sixty (60) days after the Company’s receipt of a request for review, afterconsidering all materials presented by the Claimant, the Company will inform the Participant in writing, in amanner calculated to be understood by the Claimant, of its decision setting forth the specific reasons for thedecision and containing specific references to the pertinent provisions of the Plan or Plan rules on which thedecision is based. If special circumstances require that the sixty (60) day time period be extended, the Companywill so notify the Claimant and will render the decision as soon as possible, but no later than one hundredtwenty (120) days after receipt of the request for review.(e) Limitation on Bringing a Legal Action. A legal action relating to a claim or right to benefits under thePlan may be brought by, or on behalf of, a Participant, Beneficiary or other person claiming benefits under thePlan only during a certain period. This period begins after the appeal process has ended under Section 3(c)above and ends 120 days thereafter. However, in no event may a legal action be brought later than one (1) yearafter the earlier of the date when the Participant, Beneficiary or other person: (i) knows (or should have known)of the existence of, or the underlying facts allegedly supporting the claim or right which is the basis of his orher claim or assertion for benefits or payments under, or relating to, the Plan or (ii) receives a lump sumdistribution under the Plan; provided, however, that, if the formal claim or appeal is pending under paragraph(b) or (c) above at the end of the one (1) year period, then such 120-day limitation rule shall apply.Notwithstanding the foregoing, if a Claimant files a claim within 90 days after the latest date on which apayment could be made to him or her under the Plan and the Section 409A Rules, and the claim or appeal hasnot been resolved favorable to the Claimant by the 160th day after such latest date, the Claimant may takefurther enforcement measures to collect payments which the Claimant asserts are owed to him or her under thePlan; provided, however, that, if such action is not taken within 180 days after such latest date, the Claimant’saction will not be presumed to be prompt under the Section 409A Rules and this paragraph shall not apply.ARTICLE 8 MISCELLANEOUS 8.1 Unsecured General Creditor. Participants and their Beneficiaries, heirs, successors, and assigns shallhave no legal or equitable rights, claims, or interest in any specific property or assets of the Company. No assetsof the Company shall be held under any trust (other than the Trust), or held in any way as collateral security forthe fulfilling of the obligations of the Company under this Plan. Except as provided in the Trust, any and all ofthe Company’s assets relating to the Plan shall be, and remain, the general unpledged, unrestricted assets of theCompany. The Company’s obligation under the Plan shall be merely that of an unfunded and unsecuredpromise of the Company to pay money in the future, and the rights of the Participants and Beneficiaries shall beno greater than those of unsecured general creditors. It is the intention of the Company that this Plan (and theTrust) be unfunded for purposes of the Code and for purposes of Title I of ERISA. 8.2 Restriction Against Assignment. The Company or the Trustee shall pay all amounts payable hereunderonly to the person or persons designated by the Plan and not to any other person or corporation. No part of aParticipant’s Accounts shall be liable for the debts, contracts, or engagements of any Participant, his or herBeneficiary, or successors in interest. Except as may be required by a valid qualified domestic relations orderunder ERISA, a Participant’s Accounts shall not be subject to execution by levy, attachment, or garnishment orby any other legal or equitable proceeding. A Participant or Beneficiary shall not have any right to alienate,anticipate, sell, transfer, commute, pledge, encumber, or assign any benefits or payments hereunder in anymanner whatsoever. If any Participant, Beneficiary or successor in interest is adjudicated bankrupt or purportsto anticipate, alienate, sell, transfer, commute, assign, pledge, encumber or charge any distribution or paymentfrom the Plan, voluntarily or involuntarily, the Committee, in its discretion, may cancel such distribution orpayment (or any part thereof) to or for the benefit of such Participant, Beneficiary or successor in interest insuch manner as is consistent with applicable law provided, however, that payments of a Participant’s Section409A Covered Benefits shall not cease if the Participant or Beneficiary has already incurred a PaymentEligibility Date.8.3 Withholding. There shall be deducted from each payment made under the Plan or Trust or any otherCompensation payable to the Participant (or Beneficiary) all taxes which are required to be withheld by theCompany in respect to such payment or this Plan. The Company shall have the right to reduce any payment (orCompensation) by the amount of cash sufficient to provide the amount of said taxes.8.4 Amendment, Modification, Suspension or Termination. The Board of Directors may amend, modify,suspend or terminate the Plan in whole or in part by adopting a written instrument, except that no amendment,modification, suspension or termination shall have any retroactive effect to reduce any amounts allocated to aParticipant’s Deferral Account (the Policies themselves shall not be treated as allocated to Deferral Accounts).In addition, the Committee has the right to amend Sections 3.2 and any other Plan provision (subject to thelimitation in the preceding sentence) as long as any such amendment does not have a material increase in thecosts incurred by the Company in connection with the Plan. In the event that this Plan is terminated, theamounts allocated to a Participant’s Accounts (regardless of whether such amounts had become vested) shall bedistributed to the Participant or, in the event of his or her death, his or her Beneficiary in a lump sum as soon aspracticable following the date of termination; provided, however, that the foregoing shall apply to only to theextent permissible under the Section 409A Rules for Section 409A Covered Benefits.8.5 Governing Law. This Plan shall be construed, governed and administered in accordance with the laws ofthe State of Arizona, without regard to its conflict of law provisions and except to the extent that its laws arepreempted by the laws of the United States of America and the Section 409A Rules.8.6 Receipt or Release. Any payment to a Participant or the Participant’s Beneficiary in accordance with theprovisions of the Plan shall, to the extent thereof, be in full satisfaction of all claims against the Committee andthe Company. The Committee may require such Participant or Beneficiary, as a condition precedent to suchpayment, to execute a receipt and release to such effect.8.7 Notices. All notices or other communications by a Participant to the Company in connection with thePlan shall be deemed to have been duly given when received by the Secretary of the Company or by any otherperson designated by the Company for the receipt of such notices or other communications, in the manner andat the location specified by the Company.8.8 Headings and Gender. The headings to sections in the Plan have been included for convenience ofreference only. The masculine pronoun shall include the feminine and the singular the plural, wheneverappropriate. Except as otherwise expressly indicated, all references to sections in the Plan shall be to sections ofthe Plan.8.9 Plan Not A Contract of Employment. The Plan does not constitute a contract of employment andparticipation in the Plan does not give any Eligible Employee or Participant the right to be retained in theemploy of the Company or an Affiliate nor give any person a right or claim to any benefit under the Plan,unless such right or claim has specifically accrued under the terms of the Plan.8.10 Construed as a Whole. The provisions of the Plan shall be construed as a whole in such manner as tocarry out the provisions thereof and shall not be construed separately without relation to the context.8.11 Severability. If any provision of this Plan unrelated to its status under Title I of ERISA as an unfundedplan maintained for a select group of management or highly compensated employees is held to be invalid orunenforceable by a court of competent jurisdiction, such holding shall not impact the validity or enforceabilityof the remaining provisions of the Plan. Exhibit 10.5AVNET, INC. DEFERREDCOMPENSATION PLAN FOR OUTSIDE DIRECTORS(As Amended and Restated Effective as of May 8, 2018)1. Purpose, History and Effective Date12. Definitions13. Deferral Elections34. Accounts35. Conversion to PSUs46. Crediting of Earnings47. Adjustment of PSUs48. Payment of Account Balances49. Designation and Change of Beneficiary810. Payments to Persons Other Than Participants811. Rights of Participants812. Administration813. Amendment or Termination914. Successor Corporation915. Construction916. Indemnification for Section 409A Taxes and Penalties917. Governing Law10 AVNET, INC. DEFERREDCOMPENSATION PLAN FOR OUTSIDE DIRECTORS(As Amended and Restated Effective as of May 8, 2018)1. Purpose, History and Effective DateThe purpose of this Plan is to provide Eligible Directors of Avnet, Inc., a New York corporation (the “Corporation”), with anopportunity to defer payment of certain portions of their Compensation (as defined herein), at their election, in accordance withthe provisions hereof, as may be amended from time to time. This version of the Plan, as amended and restated, amends andrestates prior versions of the Plan document known as the Avnet, Inc. Deferred Compensation Plan for Outside Directors,Amended and Restated as of January 1, 2004 (the Prior Plan) and Amended and Restated as of January 1, 2009, which wasintended to comply with final regulations issued under Code section 409A effective as of January 1, 2009 (the “Final 409AEffective Date”).The Plan is not (and the Prior Plan was not) extended to any Employee (as defined herein). If an Employee becomes anEligible Director, then only benefits attributable to his or her service as an Eligible Director shall be covered by the Plan. Nobenefits attributable to an individual’s service as an Employee shall be provided under the Plan. Accordingly, no Participant (asdefined herein) will be a Specified Employee under the Section 409A Rules (as defined here) and, therefore, the six monthpayment delay that applies to Specified Employees under the Section 409A Rules shall not apply under the Plan.From the period beginning January 1, 2005 through the December 31, 2008 (the “Interim 409A Period”), the Plan wasoperated in accordance with a good-faith interpretation of Code section 409A. At no time during, or after, the Interim 409APeriod were benefits deferred under the Prior Plan before the Interim 409A Period changed in such a manner as to cause a materialmodification of such benefits within the meaning of the Section 409A Rules. Moreover, all benefits deferred under the Prior Planwere at all times fully vested. Accordingly, benefits which were deferred under the Prior Plan before the Interim 409A Period andthe earnings attributable thereto, are not subject to Code section 409A.The Plan (and to the extent necessary the Prior Plan) shall be interpreted and construed so that benefits deferred under thePrior Plan or this Plan on and after the Interim 409A Period comply with the Section 409A Rules. The Plan shall also beinterpreted and construed so that benefits deferred under the Prior Plan before the Interim 409A Period are not subject to theSection 409A Rules. Any provision of the Plan that is found to be inconsistent with the foregoing shall be deemed to be severablefrom the terms of the Plan and shall have no force or effect.2. DefinitionsAs used herein, the following terms shall have the following meanings:(a) “Account” shall mean the Account (and sub-accounts) established for a Participant pursuant to Section 4.(b) “Average Market Value” shall mean, with respect to one share of Common Stock on any date, the average of the meanbetween the daily per-share high and low sale prices for shares of Common Stock on The Nasdaq Global Select Market(“Nasdaq”) for the period of five trading days ending on such date, or for the period of five trading days immediately precedingsuch date if the Nasdaq is closed on such date.(c) “Beneficiary” shall mean the person or persons designated by a Participant in accordance with Section 9 to receive anyamount, or any shares of Common Stock, payable under the Plan by reason of his or her death.(d) “Board of Directors” shall mean the Board of Directors of the Corporation.(e) “Code” shall mean the Internal Revenue Code of 1986, as amended.(f) “Committee” shall mean the persons appointed by the Board of Directors to administer the Plan in accordance withSection 12.(g) “Common Stock” shall mean shares of common stock of the Corporation; provided, however, that, if there is either a Pre-Section 409A Change in Control or a Post-Section 409A Change in Control (both as defined in Section 8 hereof)1 resulting in shareholders of the Corporation receiving equity securities issued by another corporation or entity, the term“Common Stock” shall mean such securities.(h) “Compensation” shall mean, with respect to any Eligible Director for any Plan Year beginning on or after January l, 2004,all fees payable to such Director during such Plan Year by way of retainer for service as a member of the Board of Directors or anycommittees thereof, including any such fees otherwise payable in the form of Common Stock (including restricted shares ofCommon Stock), but shall not include meeting fees (regardless of the form of payment). The Plan does not provide for the deferralof any payments to an Eligible Director that constitutes “performanced based compensation” under the Section 409A Rules.(i) “Corporation” shall mean Avnet, Inc., a New York corporation and its successor and assigns.(j) “Director” shall mean a member of the Board of Directors.(k) “Eligible Director” shall mean, for any Plan Year, any Director who is not an Employee at the beginning of the Plan Year.(l) “Employee” shall mean any person who is a common law employee of an Employer under the Section 409A Rules, butdoes not mean any person who is an Eligible Director or classified by the Corporation as an independent contractor.(m) “Employer” means the Corporation and any other entity that is, or would be, aggregated and treated as a singleemployer with the Corporation under Code sections 414(b) (controlled group of corporations) or 414(c) (a group of trades orbusinesses, whether or not incorporated, under common control); provided, however, that an ownership threshold of at least 50%shall be used hereunder instead of the 80% minimum ownership threshold that would otherwise apply under such Code sections.(n) “Final 409A Effective Date” shall have the meaning given to it in Section 1 hereof.(o) “Interim 409A Period” ” shall have the meaning given to it in Section 1 hereof.(p) “Participant” shall mean any Eligible Director who has made an election under Section 3 to defer any portion of his orher Compensation for any Plan Year.(q) “Phantom Share Unit” or “PSU” shall mean a unit of measurement equivalent to one share of Common Stock, with noneof the attendant rights of a holder of such share, including, without limitation, the right to vote such share and the right to receivedividends thereon, except to the extent otherwise specifically provided herein.(r) “Plan” shall mean this Avnet, Inc. Deferred Compensation Plan for Outside Directors (As Amended and Restated EffectiveGenerally as of January 1, 2009), as set forth herein and as amended from time to time.(s) “Plan Year” shall mean the calendar year.(t) “Prior Plan” shall have the meaning given to it in Section 1 hereof.(u) “Section 409A Rules” shall mean the provisions of Code section 409A and any interpretive or regulatory guidance ofgeneral application issued thereunder by the Secretary of the Treasury, the Commissioner of the Internal Revenue Service or theirdelegates.(v) “Separation From Service” shall mean that a Participant has ceased performing services for the Employers both as aDirector and an independent contractor in a manner, and to the extent, consistent with the Section 409A Rules. If a Participant isalso, or subsequently becomes, an Employee of the Corporation, his or her service as an Employee shall be excluded for purposesof determining whether the Participant has incurred a Separation From Service under this Plan as a Director to the extent providedunder the Section 409A Rules.(w) “Unforeseeable Emergency” shall mean a severe financial hardship of the Participant resulting from (i) an illness oraccident of the Participant, the Participant’s spouse, the Participant’s Beneficiary or the Participant’s dependent (as defined inCode Section 152 without regard to paragraphs (b)(1), (b)(2) and (d)(1)(b) thereof), (ii) a loss of the Participant’s property due tocasualty, or (iii) such other similar extraordinary and unforeseeable circumstances arising as a result of events beyond2 the control of the Participant, all as determined by the Committee based on the relevant facts and circumstances and consistentwith the Section 409A Rules.3. Deferral ElectionsWith respect to each Plan Year, an Eligible Director may elect to have payment of any part or all of his or her Compensationfor such year deferred, and to have payment of such portion made under the terms of the Plan. Any such election shall be made inaccordance with the following rules:(a) Written Form; Specified Percentages. A deferral election shall be made in writing, on a form provided by the Committeefor such purpose. In the election form, the Eligible Director (i) shall specify, by percentage (which must be an even multiple of10%), the portion of his or her Compensation the Eligible Director wishes to defer hereunder (amounts so deferred are hereinafterreferred to as the “Deferred Amounts”), and (ii) shall specify, by percentage (which must be an even multiple of 10%), the portionsof the Eligible Director’s Deferred Amounts that he or she wishes to have allocated, respectively, to the PSU Portion (as definedherein) and to the Cash Portion (as defined herein) of the Account established for the Eligible Director pursuant to Section 4.(b) Filing Deadline. An Eligible Director’s election to defer Compensation for any Plan Year shall be filed in writing with theCommittee no later than November 30 of the preceding Plan Year when the Eligible Director’s Compensation subject to thedeferral election is earned; provided, however, that the Committee may, in its discretion, extend this filing period to a date that isno later than the last business day in December of such preceding Plan Year.(c) Special Procedure for First Time Eligible Director. Notwithstanding the provisions of paragraph (b) above, an individualwho first becomes an Eligible Director during a Plan Year may make a deferral election hereunder with respect to his or herCompensation for such Plan Year by filing his or her election form with the Committee no later than 30 days after the date onwhich he or she first became an Eligible Director. Any deferral election so made shall be effective only with respect toCompensation earned for services performed after the date on which such election has been filed with the Committee. Forpurposes of this paragraph (c), when an individual first becomes an Eligible Director shall be determined under the planaggregation rules under the Section 409A Rules. For the avoidance of doubt, an individual who participated in a deferredcompensation plan or arrangement with an Employer as an independent contractor in the same year when he or she first becomesan Eligible Director is not eligible for the special 30 day enrollment provision under this paragraph (c) if such other plan orarrangement would be combined with this Plan under the plan aggregation rules pursuant to the Section 409A Rules.(d) Irrevocable Status of Election; Carry-Forward to Next Plan Year. Any deferral election made by an Eligible Director withrespect to his or her Compensation for a Plan Year, and any election made hereunder as to the allocation of the Deferred Amountsfor such year to the PSU Portion and the Cash Portion of his or her Account, shall be irrevocable for the Plan Year except to theextent specifically permitted under the Section 409A Rules. A Participant’s election made under this Section 3 for a Plan Yearshall automatically carry-forward to the next Plan Year unless it is changed or revoked by the Participant prior to the beginning ofthe next Plan Year.(e) Allocations of Deferred Amounts Relating to Common Stock. Except as otherwise specifically provided under the Plan,any Compensation otherwise payable in the form of Common Stock (including shares of restricted Common Stock) and deferredhereunder as Deferred Amounts shall be allocated solely to the PSU Portion of the Participant’s Account, and shall not be eligiblefor the Cash Portion of such Eligible Director’s Account.4. AccountsFor each Participant, there shall be established on the books and records of the Corporation, for bookkeeping purposes only,a separate Account to reflect the Participant’s interest under the Plan. The Account so established shall be maintained inaccordance with the following provisions:(a) Accounts and Sub-accounts. The Account established for each Participant shall consist of two sub-accounts referred toherein, respectively, as the “PSU Portion” and the “Cash Portion”. Each of such sub-account shall be further divided intoadditional sub-accounts reflecting Deferred Amounts under the Plan before, and on and after, the Interim 409A Period.(b) Crediting of Accounts. The PSU Portion and the Cash Portion of each Participant’s Account shall be credited withamounts equal to the portions of the Participant’s Deferred Amounts for each Plan Year that the Participant has elected under3 Section 3 hereof to have allocated to such Portions. Such amounts shall be so credited as of the date on which the amounts inquestion would have been paid to the Participant had the Participant not elected to have payment of such amounts deferred.(c) Adjustments to Accounts. The PSU Portion and the Cash Portion of a Participant’s Account shall be adjusted from time totime to reflect all additional PSUs and interest to be credited to such Portions pursuant to Section 6, and all payments made withrespect to such Portions pursuant to Section 8.(d) Impact of Certain Change in Control Events on PSU Portion. If there is a Pre-Section 409A Change in Control or a Post-Section 409A Change in Control resulting in all (or substantially all shareholders) of the Corporation receiving cash payments fortheir Common Stock, then a Participant’s PSU Portion shall automatically be converted to a Cash Portion based on the number ofPSUs standing to the Participant’s credit on the cash payment date to shareholders multiplied by the per share price paid (in cashand/or other consideration other than equity securities) to shareholders generally for each share of Common Stock.(e) Accounts are Fully Vested. A Participant’s interest in his or her Account shall be fully vested and nonforfeitable at alltimes.5. Conversion to PSUsAmounts credited to the PSU Portion of a Participant’s Account pursuant to paragraph (c) of Section 4 shall be converted into(and after such conversion shall be reflected in such Portion as) a number of Phantom Share Units. Such number shall bedetermined by dividing the amount so credited by the Average Market Value of one share of Common Stock on the date as ofwhich the amount is so credited.6. Crediting of EarningsUntil payment with respect to a Participant’s Account has been made in full in accordance with Section 8, the PSU Portion ofa Participant’s Account shall be credited with additional PSUs and the Cash Portion of the Participant’s Account shall be creditedwith interest, in accordance with the following provisions:(a) Crediting Earnings to PSU Portion. As of each date on which the Corporation pays a dividend on its Common Stock(“Dividend Payment Date”), the PSU Portion of each Participant’s Account shall be credited with additional PSUs, the number ofwhich shall be determined by: (i) first multiplying the number of PSUs standing to the Participant’s credit on the record date forsuch dividend by the per-share amount of the dividend so paid, and (ii) second dividing the resulting amount by the AverageMarket Value of one share of Common Stock on the Dividend Payment Date.(b) Crediting Earnings to Cash Portion. As of the last day of each calendar month, the balance of the Cash Portion of aParticipant’s Account shall be credited with an amount determined by multiplying such balance by a percentage correspondingto the rate of interest on U.S. Treasury 10-year Notes on the first day of such calendar month.7. Adjustment of PSUsIn the event of any change in the Common Stock occurring by reason of any stock dividend, recapitalization, reorganization,merger, consolidation, split-up, combination or exchange of shares, or any rights offering to purchase such shares at a pricesubstantially below fair market value, or any similar change affecting the Common Stock, the number and kind of sharesrepresented by Phantom Share Units shall be appropriately adjusted consistent with such change in such manner as theCommittee, in its sole discretion, may deem equitable to prevent substantial dilution or enlargement of the rights granted to, oravailable for, the Participants hereunder. The Committee shall give notice to each Participant of any adjustment made pursuant tothis Section 7 and, upon such notice, such adjustment shall be effective and binding for all purposes of the Plan.8. Payment of Account BalancesPayment with respect to a Participant’s Account shall be made in accordance with the following provisions:(a) General Distribution Procedures. The balances of the PSU Portion and the Cash Portion of a Participant’s Account shallbecome payable upon the Participant’s ceasing to be a member of the Board of Directors for any reason; provided, however, thatdistributions attributable to Deferred Amounts made on or after the Interim Section 409A Period shall be4 postponed until after the date when the Participant has incurred a Separation From Service. Except as otherwise provided inparagraph (b) below, payment with respect to a Participant’s Account shall be made in the form of a series of 10 annualinstallments.(b) Optional Distribution Elections. In lieu of the payment form specified in paragraph (a) above, a Participant may elect tohave the balances of the PSU Portion and the Cash Portion of his or her Account paid in the form of a single lump-sum payment,or in such number of annual installments, not to exceed 10, as the Participant specifies in such election in accordance with theprovisions of this paragraph (b). Any such election shall be made in writing, on a form that has been furnished by the Committeeto the Participant for such purpose and that is filed by the Participant with the Committee. For purposes of the Section 409ARules, the annual installment payment option shall be treated as a single payment.(i) Payment Elections for Deferred Amounts Made Prior to the Interim 409A Period. For Deferred Amountsattributable to Compensation earned before the Interim 409A Period only, any such election shall be effective only if it hasbeen filed with the Committee at least 24 months prior to the date on which the Participant ceases to be a Director. AParticipant may revoke any election so made, and make a new election hereunder, provided that such revocation or newelection is filed with the Committee at least 24 months prior to the date on which the Participant ceases to be a Director. Anysuch revocation or new election shall be made in writing, on a form furnished by the Committee to the Participant for suchpurpose.(ii) Payment Elections for Deferred Amounts Made on and After the Interim 409A Period. For Deferred Amountsattributable to Compensation earned on or after the Interim 409A Period, any such election shall, except as provided below,be effective only if it has been filed with the Committee no later than the last day of the Plan Year before the Plan Year whenthe Compensation corresponding to the Deferred Amounts is earned. A Participant may file separate distribution elections foreach Plan Year’s Deferred Amounts made on or after the Interim 409A Period. Payment elections for Deferred Amountssubject to this subparagraph (ii) may only be changed (by a Participant or, if applicable, a Beneficiary) in accordance with thefollowing rules: (A) the change must be submitted in writing to the Committee at least 12 months prior to the previouslyscheduled payment date corresponding to the requested change; (B) the change may not take effect for at least 12 months, (C)the change must result in a postponed distribution for at least five years from the previously scheduled payment date exceptin the case of distributions due to death, Disability (as defined under the Section 409A Rules) or an UnforeseeableEmergency (as defined under the Section 409A Rules) and (D) the change may only result in an acceleration of a distributionto the extent permitted under the Section 409A Rules.(c) Timing of Installment Payments. If payment with respect to a Participant’s Account is to be made in the form of annualinstallments, the first such installment payment shall be made on or as soon as practicable after the first business day of the PlanYear following the Plan Year in which the Participant becomes entitled to receive a distribution under paragraph (a) above and nolater than the end of that calendar year quarter, and the remaining installment payments shall be made within the same timeframefor each succeeding Plan Year.(d) Amount of Installment Payments. Each installment payment to be made with respect to the Cash Portion of a Participant’sAccount shall be made in cash, in an amount determined by dividing (i) the balance of the Cash Portion determined as of the lastday of the Plan Year preceding the year in which such payment is to be made, by (ii) the number of installment paymentsremaining to be made.(e) Form of Installment Payments. Each installment payment to be made with respect to the PSU Portion of a Participant’sAccount shall be made partly in shares of Common Stock and partly in cash. The number of shares to be included in each suchinstallment payment shall be equal to the number of whole PSUs included in the quotient resulting from dividing (i) the totalnumber of PSUs included in the balance of the PSU Portion of the Participant’s Account as of the last day of the Plan Yearpreceding the year in which such payment is to be made, by (ii) the number of installment payments remaining to be made; andthe amount of cash to be included in each such installment payment shall be determined by multiplying (iii) the fractional part ofa PSU included in the aforementioned quotient by (iv) the Average Market Value of one share of Common Stock on the lastbusiness day preceding the date on which such installment payment is to be made.(f) Form of Lump Sum Payments. If payment with respect to all or a portion of a Participant’s Account is to be made in theform of a single lump sum payment, such payment shall be made on or as soon as practicable after the first business day of thePlan Year following the Plan Year in which the Participant becomes entitled to receive a distribution under paragraph (a) aboveand no later than the end of that calendar year quarter. Such payment shall be made (i) in cash, with respect to the balance of theCash Portion of the Participant’s Account and with respect to any fractional PSUs included in the balance of the PSU Portion ofthe Participant’s Account (with the cash amount payable for such fractional PSUs calculated on the basis of the Average MarketValue of a share of Common Stock on the last business day preceding the date of payment), and (ii) in5 shares of Common Stock, with respect to the number of whole PSUs included in the balance of the PSU Portion of theParticipant’s Account.(g) Payments to Beneficiaries. If a Participant should die before receiving all payments required to be made hereunder withrespect to his or her Account, any payments remaining to be made at the date of the Participant’s death shall be made to theParticipant’s Beneficiary. Payments to the Beneficiary shall be made in the same form, and at the same times, as the paymentswould have been made to the Participant had he or she not died; provided, however, that a Beneficiary may change a paymentform for Deferred Amounts made on and after the Interim 409A Period only in a manner consistent with subparagraph (b)(ii)above.(h) Early Distributions for Unforeseeable Emergencies. Notwithstanding any other provision in this Section 8 to the contrarypayment with respect to any part or all of the Participant’s Account balances may be made to the Participant on any date earlierthan the date on which such payment is to be made pursuant to such other provisions of this Section 8 if (i) the Participantrequests such early payment and (ii) the Committee, in its sole discretion, determines that such early payment is necessary to helpthe Participant meet an “unforeseeable emergency” within the meaning of Treasury Regulation §1.457-6(c)(2) with respect toDeferred Amounts not subject to Code section 409A or based on the Unforeseeable Emergency standard for Deferred Amountsmade on or after the Interim 409A Period. In either case, the amount that may be so paid may not exceed the amount necessary tomeet such emergency and such amount shall be reduced by any amount available to relieve the emergency throughreimbursement or compensation from insurance or otherwise, by liquidation of the Participant’s assets (if such liquidation wouldnot cause severe financial hardship) or by the cessation of deferrals under the Plan.(i) Early Distributions for Section 409A Tax Liability. Notwithstanding any provision of this Section 8 to the contrary, if anyportion of a Participant’s Account under this Plan is required to be included in income by the Participant prior to receipt due to afailure of this Plan to comply with the requirements of Code section 409A and the Section 409A Rules, the Committee maydetermine that such Participant shall receive a distribution from the Plan in an amount equal to the lesser of (A) the portion of hisor her Account required to be included in income as a result of the failure of the Plan to comply with the requirements of Codesection 409A and the Section 409A Rules or (B) the unpaid vested Account balance.(j) Distribution Upon Change in Control Events. Notwithstanding any other provision in this Section 8 to the contrary, theentire unpaid balance of a Participant’s Account attributable to Deferred Amounts: (i) made before the Interim Section 409APeriod shall become immediately due and payable upon the occurrence of a Pre-Section 409A Change in Control, as hereinafterdefined and (ii) made on or after the Interim Section 409A Period shall become immediately due and payable upon the occurrenceof a Post-Section 409A Change in Control. In either case, payment with respect to such balance shall be made in the form of asingle lump-sum payment. Payment shall be made as soon as practicable after the occurrence of the applicable change in controland no later than 90 days thereafter. Payment shall be made (A) in cash, with respect to the payable balance of the Cash Portion ofthe Participant’s Account and with respect to any fractional PSUs included in the payable balance of the PSU Portion of theParticipant’s Account (with the cash amount payable for such fractional PSUs calculated on the basis of the Average MarketValue of a share of Common Stock on the last business day preceding the date of payment), and (B) subject to Section 4(d), inshares of Common Stock, with respect to the number of whole PSUs then included in the balance of the PSU Portion of theParticipant’s Account.For purposes of the foregoing:(A) a “Pre-Section 409A Change in Control” shall be deemed to have occurred (i) when any entity, person (within themeaning of Section 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or group (withinthe meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) other than the Corporation or any of its subsidiaries,or any savings, pension or other plan for the benefit of employees of the Corporation or any of its subsidiaries), whichtheretofore was beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of less than 20% of the thenoutstanding Common Stock either (a) acquires shares of Common Stock in a transaction or series of transactions thatresults in such entity, person or group directly or indirectly owning beneficially 20% or more of the outstandingCommon Stock, or (b) acquires by proxy or otherwise the right to vote for the election of directors, for any merger,combination or consolidation of the Corporation or any of its subsidiaries, or for any other matter or question more than20% of the then outstanding voting securities of the Corporation (except where such acquisition is made by a person orpersons appointed by at least a majority of the Board of Directors to act as proxy for any purpose); or (ii) upon theelection or appointment, within a twelve-month period, of persons to the Board of Directors who were not directors ofthe Corporation at the beginning of such twelve-month period, and whose election or appointment was not approvedby a majority of those persons who were directors at the6 beginning of such period, where such newly-elected or appointed directors constitute 20% or more of the members ofthe Board of Directors; and(B) A “Post-Section 409A Change in Control” shall mean the occurrence of a: (1) “change in the ownership,” (2) “change inthe effective control” or (3) “change in the ownership of a substantial portion of the assets” of the Corporation or, ifrequired under the Section 409A Rules, another Employer. In order for an event described below to constitute a Post-Section 409A Change in Control with respect to a Participant, except as otherwise specifically provided below, theapplicable event must relate to the Employer entity for which the Participant is providing services, the Employer entitythat is liable for payment of the Participant’s benefit hereunder (or all Employer entities liable for payment if more thanone), as determined in accordance with Treas. Reg. §1.409A-3(i)(5)(ii)(A)(2), or such other corporation identified by theCommittee in accordance with Treas. Reg. §1.409A-3(i)(5)(ii)(A)(3). In determining whether an event shall beconsidered a “change in the ownership,” a “change in the effective control” or a “change in the ownership of asubstantial portion of the assets” of the Corporation (or, if applicable, other Employer), the following provisions shallapply:1. A “change in the ownership” shall occur on the date on which any one person, or more than one person acting as agroup, acquires ownership of stock of the Corporation (or, if applicable, other Employer) that, together with stockheld by such person or group, constitutes more than 50% of the total fair market value or total voting power of theCorporation’s (or, if applicable other Employer’s) stock, as determined in accordance with Treas. Reg. §1.409A-3(i)(5)(v). If a person or group is considered either to own more than 50% of the total fair market value or total votingpower of its stock, or to have effective control of the Corporation (or, if applicable, other Employer) within themeaning of subparagraph (2) below, and such person or group acquires additional stock of the Corporation (orother Employer), the acquisition of additional stock by such person or group shall not be considered to cause a“change in the ownership” of the Corporation (or, if applicable, other Employer).2. A “change in the effective control” of the Corporation (or, if applicable, other Employer) shall occur on either ofthe following dates:a. The date on which any one person, or more than one person acting as a group, acquires (or has acquired duringthe 12-month period ending on the date of the most recent acquisition by such person or persons) ownership ofstock of the Corporation (or, if applicable, other Employer) possessing 30% or more of the total voting powerof its stock of the Corporation (or, if applicable, other Employer), as determined in accordance with Treas. Reg.§1.409A-3(i)(5)(vi). If a person or group is considered to possess 30% or more of the total voting power of itsstock of the Corporation (or, if applicable, other Employer), and such person or group acquires additional stockof the Corporation (or, if applicable, other Employer), the acquisition of additional stock by such person orgroup shall not be considered to cause a “change in the effective control” of the Corporation (or, if applicable,other Employer); orb. The date on which a majority of the Board of Directors is replaced during any 12-month period by directorswhose appointment or election are not endorsed by a majority of the members of the Board of Directors beforethe date of the appointment or election, as determined in accordance with Treas. Reg. §1.409A-3(i)(5)(vi). Indetermining whether the event described in the preceding sentence has occurred, the Corporation shall, ifnecessary, be replaced with another Employer identified in accordance with Treas. Reg. §1.409A-3(i)(5)(ii) forwhich no other corporation is a majority shareholder for purposes of the preceding sentence.3. A “change in the ownership of a substantial portion of the assets” of the Corporation (or, if applicable, otherEmployer) shall occur on the date on which any one person, or more than one person acting as a group, acquires (orhas acquired during the 12-month period ending on the date of the most recent acquisition by such person orpersons) assets from the Corporation (or, if applicable, other Employer) that have a total gross fair market valueequal to or more than 40% of the total gross fair market value of all of the assets of the Corporation (or, ifapplicable, other Employer) immediately before such acquisition or acquisitions, as determined in accordance withTreas. Reg. §1.409A-3(i)(5)(vii). A transfer of assets shall not be treated as a “change in the ownership of asubstantial portion of the assets” when such transfer is made to an entity that is controlled by the shareholders ofthe Corporation, (or, if applicable, other Employer) as determined in accordance with Treas. Reg. §1.409A-3(i)(5)(vii)(B).7 (k) Income Tax Withholding. There shall be deducted from the amount of any payment otherwise required to be made underthe Plan all federal, state and local taxes required by law to be withheld with respect to such payment.9. Designation and Change of BeneficiaryEach Participant shall file with the Committee a written designation of one or more persons as the Beneficiary who shall beentitled to receive any amount, or any shares of Common Stock, payable under the Plan by reason of his or her death. AParticipant may, from time to time, revoke or change his or her Beneficiary designation without the consent of any previously-designated Beneficiary by filing a new designation with the Committee. The last such designation received by the Committeeshall be controlling; provided, however, that no designation, or change or revocation thereof, shall be effective unless receivedby the Committee prior to the Participant’s death, and in no event shall it be effective as of a date prior to such receipt. If at thedate of a Participant’s death, there is no designation of a Beneficiary in effect for the Participant pursuant to the provisions of thisSection 9, or if no Beneficiary designated by the Participant in accordance with the provisions hereof survives to receive anyamount payable under the Plan by reason of the Participant’s death, the Participant’s estate shall be treated as the Participant’sBeneficiary for purposes of the Plan.10. Payments to Persons Other Than ParticipantsIf the Committee shall find that any Participant or Beneficiary to whom any amount, or any shares of Common Stock, ispayable under the Plan is unable to care for his or her affairs because of illness, accident or legal incapacity, then, if theCommittee so directs, such amount, or such shares, may be paid to such Participant’s or Beneficiary’s spouse, child or otherrelative, an institution maintaining or having custody of such person, or any person deemed by the Committee to be a properrecipient on behalf of such Participant or Beneficiary, unless a prior claim therefor has been made by a duly-appointed legalrepresentative of the Participant or Beneficiary.Any payment made under this Section 10 shall be a complete discharge of the liability of the Corporation with respect tosuch payment.11. Rights of ParticipantsA Participant’s rights and interests under the Plan shall be subject to the following provisions:(a) Unsecured Creditor Status of Participants. A Participant shall have the status of a general unsecured creditor of theCorporation with respect to his or her right to receive any payment under the Plan. The Plan shall constitute a mere promise bythe Corporation to make payments in the future of the benefits provided for herein. It is intended that the arrangements reflectedin this Plan be treated as unfunded for tax purposes.(b) Establishment of Trust. The Corporation may, but shall not be required to, establish a trust to assist it in funding any of itspayment obligations under the Plan. If any such trust is established, all of the assets of the trust shall, at all times prior to paymentto Participants, remain subject to the claims of the Corporation’s general creditors; and no Participant or Beneficiary shall haveany preferred claim on, or any beneficial ownership interest in, any assets of the trust. Any trust so established shall also containsuch other terms and provisions as will permit the trust to be treated as a “grantor trust”, of which the Corporation is the grantor,within the meaning of subpart E, part I, subchapter J, chapter 1, subtitle A of the Code. If any such trust is established, theCorporation shall be relieved of its obligation hereunder to pay any amounts or shares of Common Stock to any Participant orBeneficiary, to the extent that such amounts or shares are paid to the Participant or Beneficiary from such trust.(c) Prohibition on Alienation of Benefits. A Participant’s rights to payments under the Plan shall not be subject in any mannerto anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors of theParticipant or his or her Beneficiary.12. AdministrationThe Plan shall be administered by the Corporate Governance Committee of the Board of Directors (or such other committeeas designated by the Board of Directors) (the “Committee”) or its designees. All decisions, actions or interpretations of theCommittee under the Plan shall be final, conclusive and binding upon all parties. The Committee shall have full discretion andauthority to construe and interpret the terms and provisions of this Plan, which interpretation or construction shall be final andbinding on all parties, including, but not limited to, an Employer, any Participant or8 beneficiary. Without limiting the generality of the foregoing, the Committee shall have the authority to: (a) construe and interpretthe terms and provisions of this Plan and to remedy any ambiguities, omissions or inconsistencies contained therein; (b) computeand certify to the amount and kind of benefits payable to Participants and their Beneficiaries; (c) maintain all records that may benecessary for the administration of the Plan; (d) promulgate, administer and enforce such rules for the regulation of the Plan andprocedures for the administration of the Plan as are not inconsistent with the terms hereof; and (e) appoint a plan administrator orany other agent, and to delegate to them such powers and duties in connection with the administration of the Plan as theCommittee may from time to time prescribe.No member of the Committee shall be personally liable by reason of any contract or other instrument executed by suchmember or on his or her behalf in his or her capacity as a member of the Committee nor for any mistake of judgment made in goodfaith, and the Corporation shall indemnify and hold harmless each member of the Committee, and each employee, officer, ordirector of the Corporation or any of its subsidiaries to whom any duty or power relating to the administration or interpretation ofthe Plan may be delegated, against any cost or expense (including counsel fees) or liability (including any sum paid in settlementof a claim with the approval of the Board of Directors) arising out of any act or omission to act in connection with the Plan unlessarising out of such person’s own fraud or bad faith.13. Amendment or TerminationThe Board of Directors may, with prospective or retroactive effect, amend, suspend or terminate the Plan or any portionthereof at any time; provided, however, that no amendment of the Plan shall deprive any Participant of any rights to receivepayment of any amounts or shares of Common Stock due him or her under the terms of the Plan as in effect prior to suchamendment without his or her written consent. Notwithstanding the preceding sentence, to the extent permitted by the Section409A Rules, the Corporation may provide that upon termination of the Plan, all Account balances of the Participants shall bedistributed, subject to and in accordance with any rules established by the Corporation deemed necessary to comply with theapplicable requirements and limitations under the Section 409A Rules.Any amendment that the Board of Directors would be permitted to make pursuant to the preceding paragraph may also bemade by the Committee where appropriate to facilitate the administration of the Plan or to comply with applicable law or anyapplicable rules and regulations of governing authorities, provided that the cost of the Plan to the Corporation is not materiallyincreased by such amendment.14. Successor CorporationThe obligations of the Corporation under the Plan shall be binding upon any successor corporation or organization resultingfrom the merger, consolidation or other reorganization of the Corporation, or upon any successor corporation or organizationsucceeding to substantially all of the assets and business of the Corporation. The Corporation agrees that it will make appropriateprovision for the preservation of Participants’ rights under the Plan in any agreement or plan which it may enter into or adopt toeffect any such merger, consolidation, reorganization or transfer of assets.15. ConstructionIf any provision of this Plan shall be held by a court of competent jurisdiction to be invalid or unenforceable, the rest of theprovisions of this Plan shall nevertheless remain in full force and effect. A Participant’s election form for a Plan Year may beexecuted in one or more counterparts (including by facsimile and e-mail), each of which shall be deemed to be an original, but allof which when taken together shall constitute one and the same instrument. Whenever any words are used herein in themasculine, they shall be construed as though they were in the feminine in all cases where they would so apply; and whenever anywords are used herein in the singular or in the plural, they shall be construed as though they were used in the plural or thesingular, as the case may be, in all cases where they would so apply. The captions of the sections and paragraphs of this Plan arefor convenience only and shall not control or affect the meaning or construction of any of its provisions.Any reference to a particular provision of the Code or a regulation issued under the Code shall be deemed to automaticallyinclude any successor provision.16. Indemnification for Section 409A Taxes and PenaltiesIf any payment or distribution by, or on behalf of, the Corporation to or for the benefit of a Participant (or Beneficiary) issubject to, or the Participant (or Beneficiary) is notified by the Internal Revenue Service that he or she is or will be subject to,9 a penalty taxes imposed by Section 409A of the Code or if any interest or penalties are incurred by the Participant (orBeneficiary) with respect to such penalty taxes (such penalty taxes together with any such interest and penalties, are hereinaftercollectively referred to as the “Section 409A Tax”), then the Participant (or Beneficiary) shall be entitled to receive an additionalpayment (a “Section 409A Gross-Up Payment”) in an amount such that after payment by Participant (or Beneficiary) of allSection 409A Tax and all income taxes (and any interest and penalties imposed with respect thereto) imposed upon the Section409A Gross-Up Payment, the Participant (or Beneficiary) retains an amount of the 409A Gross-Up Payment equal to the Section409A Tax imposed upon the Payment; provided, however, that the Corporation shall only be responsible to make a Section 409AGross-Up Payment with respect to the Section 409A Tax if the Section 409A Tax relates to or results from (i) the Corporation’sfailure to operate a “nonqualified deferred compensation plan” (as such term is defined in the Section 409A Rules) (a “NQDC”) incompliance with the Section 409A Rules on and after January 1, 2005; or (ii) the lack of compliance of any Corporation NQDCdocument or documentation with the Section 409A Rules; or (iii) the payment or distribution by the Corporation (or by anyCorporation NQDC) of any NQDC amount if such payment or distribution is not in compliance with the Section 409A Rules. Forthe avoidance of doubt, the Corporation shall not be responsible to make any Section 409A Gross-Up Payment if, (1) after atimely notice or request by the Corporation to the Participant (or Beneficiary), the Participant (or Beneficiary) refuses or fails tomake a timely election to alter the timing of payment or distribution or (2) the Participant, in his or her capacity as a Director,causes the Corporation to take any action, or causes the Corporation to fail to take any action, which causes the Participant (orBeneficiary) to be subject to a Section 409A Tax.Determinations required to be made on the amount of the Section 409A Gross-Up Payment and the assumptions to be utilizedin arriving at such determination, shall be made by a certified public accounting firm selected by the Corporation (the“Accounting Firm”) which shall provide detailed supporting calculations both to the Corporation and the Participant (orBeneficiary) within thirty (30) business days of the receipt of notice from the Participant (or Beneficiary) that he or she is subjectto a Section 409A Tax, or such earlier time as is reasonably requested by the Corporation. All fees and expenses of theAccounting Firm shall be borne solely by the Corporation. Any Section 409A Gross-Up Payment, as determined pursuant to thisSection, shall be paid by the Corporation to the Participant (or Beneficiary) within thirty (30) days of the receipt of theAccounting Firm’s determination, but in no event later than the last day of the year following the year in which the Participant (orBeneficiary) remits the related taxes. Any determination by the Accounting Firm shall be binding upon the Corporation and theParticipant (or Beneficiary).17. Governing LawThe provisions of the Plan shall be governed by and construed in accordance with the internal laws of the State of New York,and without regard to its conflict of laws provisions. Notwithstanding the foregoing, the Plan shall be governed and construed ina manner consistent with the Section 409A Rules which shall take precedent over any laws of the State of New York which areinconsistent with the Section 409A Rules.10 Exhibit 10.8AVNET, INC.2010 STOCK COMPENSATION PLAN (As Amended and Restated Effective as of May 8, 2018)ARTICLE 1PURPOSE OF THE PLAN The Avnet, Inc. 2010 Stock Compensation Plan, as amended and restated, is intended to advance the interests of the Companyby helping Avnet and its Subsidiaries to attract, retain, and appropriately motivate high caliber persons to serve as EligibleEmployees and Non-Employee Directors, and by providing incentives to Eligible Employees and Non-Employee Directors thatare consistent with the shareholders’ interest in maximizing the value of Avnet’s Common Stock.ARTICLE 2DEFINITIONS Unless the context indicates otherwise, the following terms, when used in capitalized form, shall have the meanings set forthbelow:2.1. “Administrator” means—(a) with respect to each Award granted to an Eligible Employee, the Committee; and(b) with respect to each Award granted to a Non-Employee Director, the Independent Directors.2.2. “Avnet” means Avnet, Inc.2.3. “Agreement” means the agreement evidencing an Award granted hereunder, including any addendum to an OptionAgreement relating to Stock Appreciation Rights. Each Agreement shall be in such form as prescribed or approved by theAdministrator.2.4. “Award” means a grant under the Plan of an Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, orOther Stock Unit Award, as evidenced by an Agreement.2.5. “Board of Directors” and “Director” shall mean, respectively, the Board of Directors of Avnet and any member thereof.2.6. “Change in Control” means the happening of any of the following:(a) the acquisition, by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the ExchangeAct (a “Person”)), of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50%or more of either (A) the then outstanding shares of Stock or (B) the combined voting power of the then outstanding votingsecurities of Avnet entitled to vote generally in the election of Directors; provided, however, that none of the followingacquisitions shall constitute a Change in Control under this subsection (a): (i) an acquisition directly from Avnet (excludingan acquisition by virtue of the exercise of a conversion privilege), (iii) an acquisition by Avnet, or (iv) an acquisition by anyemployee benefit plan (or related trust) sponsored or maintained by Avnet or any entity controlled by Avnet; or(b) individuals who, as of the date of the 2010 annual meeting of Avnet’s stockholders (the “Determination Date”), constitutethe Board of Directors (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board of Directors;provided, however, that an individual who becomes a Director after the Determination Date shall be treated as a member ofthe Incumbent Board if (i) his election, or nomination for election by Avnet’s stockholders, was approved by a vote of at leasta majority of the Directors then comprising the Incumbent Board, and (ii) his initial assumption of office does not occur as aresult of an actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or(c) A complete liquidation or dissolution of Avnet or the sale or other disposition of all or substantially all of the assets ofAvnet.2.7. “Code” means the Internal Revenue Code of 1986, as amended.2.8. “Committee” means the Compensation Committee of the Board of Directors, which shall consist of three or more Non-Employee Directors appointed by the Board of Directors; provided, however, that no individual who is not both a “non-employeedirector” within the meaning of Rule 16b-3 and an “outside director” within the meaning of Section 162(m) of the Code shallserve as a member of the Committee unless there are fewer than two Non-Employee Directors who satisfy such conditions.2.9. “Company” means Avnet and all its Subsidiaries.2.10. “Covered Participant” means a Participant who is a “covered employee” under Code Section 162(m).2.11. “Eligible Employee” means a regular full-time employee of Avnet or of any of its Subsidiaries (including any Director whois also a regular full-time employee of Avnet or a Subsidiary). The term “Eligible Employee” shall also include an individualretained by Avnet or any of its Subsidiaries to render services as a consultant or advisor other than services in connection with theoffer or sale of securities in a capital-raising transaction or services that directly or indirectly promote or maintain a market forAvnet’s securities.2.12. “Exchange Act” means the Securities Exchange Act of 1934, as amended.2.13. “Executive Officer” means an employee designated by Avnet as an executive officer under Rule 16b-3.2.14. “Fair Market Value” means, with respect to any date, the closing price (as reported for the Nasdaq Composite Index) atwhich shares of Stock have been sold on such date (or, if such date is a date for which no trading is so reported, on the nextpreceding date for which trading is so reported.2.15. “Grant Date” means, with respect to granting an Award or modification of an outstanding Award, the date on which thematerial terms of the Award (including the number of shares covered by the Award, the conditions for vesting, lapse of the Periodof Restriction, and exercise, and the purchase price, if any) are established and the Administrator’s action constituting the makingor modification of such Award is completed, without regard to (a) the date on which the applicable Agreement is executed or (b)whether such Award or modification is subject to future shareholder approval or other conditions. The Grant Date for any Awardshall not occur before the recipient of the Award becomes an Eligible Employee or Non-Employee Director, as applicable.2.16. “Incentive Stock Option” or “ISO” means an Option intended to qualify as an “incentive stock option” under Section 422 ofthe Code.2.17. “Independent Directors” means members of the Board of Directors acting as a group, each of whom satisfies Avnet’s“Director Independence Standards,” which are consistent with the director independence requirements established from time totime by The Nasdaq Global Select Market.2.18. “Non-Employee Director” means a Director who is not an Eligible Employee.2.19. “Option” means an Award granted pursuant to Article 5 that gives the recipient the right to purchase a specified number ofshares at a specified price during a specified term, subject to the terms and conditions of the applicable Agreement.2.20. “Optionee” means a person who, at the time in question, holds an Option that then remains unexercised in whole or in part,has not been surrendered, and has not expired or terminated. The term “Optionee” also includes any Successor Optionee.2.21. “Other Stock Unit Award” means an Award granted pursuant to Article 9.2.22. “Participant” means an Eligible Employee or Non-Employee Director who has been granted an Award hereunder.2.23. “Period of Restriction” means the period during which the transfer of shares of Restricted Stock is restricted, pursuant toArticle 7.2.24. “Person” means “person” as defined in Section 3(a)(9) of the Exchange Act and as used in Sections 13(d) and 14(d) thereof,including a “group” as defined in Section 13(d) of the Exchange Act, but excluding Avnet, any Subsidiary, and any employeebenefit plan sponsored or maintained by Avnet or any Subsidiary (including any trustee of such plan acting as trustee).2.25. “Performance Criteria” means any of the following criteria as related to Avnet, any Subsidiary, or any division or other areaof Avnet or a Subsidiary: economic profit, total stockholder return, revenues, sales, net income, earnings per share, return onequity, cash flow, operating margin, or net worth. In addition, for any Participant who is not a Covered Participant, PerformanceCriteria may include any other criteria selected by the Committee.2.26. “Performance Objectives” means, for any Award that is contingent in whole or in part on achievement of performanceobjectives, the objectives or other performance levels with respect to specified Performance Criteria that are measured over acalendar year or other specified period for the purpose of determining the amount of such Award and/or whether such Award isgranted or vested.2.27. “Plan” means the Avnet, Inc. 2010 Stock Compensation Plan, as set forth herein and as amended from time to time.2.28. “Restricted Stock” means an Award of Stock granted pursuant to Article 7. 2.29. “Restricted Stock Unit” means an Award granted pursuant to Article 8 that gives the recipient a contractual right to receivecash or shares of Stock upon the attainment of specified vesting conditions.2.30. “Rule 16b-3” means SEC Rule 16b-3 promulgated under the Exchange Act.2.31. “Securities Act” means the Securities Act of 1933, as amended.2.32. “Stock” means, subject to the adjustment provisions set forth in Article 11, Avnet’s $1.00 par value common stock.2.33. “Stock Appreciation Right” or “SAR” means an Award granted pursuant to Article 6 that gives the recipient the right toreceive, upon exercise of the Award, an amount equal to the excess of the Fair Market Value of the shares of Stock with respect towhich the SAR is being exercised (determined as of the exercise date) over the exercise price set forth in the Agreement. Theamount payable upon exercise of a SAR may be paid in cash, shares of Stock, or a combination of cash and shares of Stock withan aggregate Fair Market Value (determined as of the exercise date) equal to the amount described in the immediately precedingsentence.2.34. “Subsidiary” means a corporation in which Avnet directly or indirectly owns more than 50% of the total combined votingpower of all classes of capital stock. The term Subsidiary includes any corporation in which a Subsidiary described in theimmediately preceding sentence owns more than 50% of the total combined voting power of all classes of capital stock.2.35. “Successor Optionee” means any person who, under the provisions of Article 5, has acquired from an Optionee the right toexercise an Option, for so long as such Option remains unexercised in whole or in part, and has not been surrendered, exercised, orterminated.ARTICLE 3SHARES RESERVED FOR THE PLAN 3.1. General Limitations. Subject to the adjustment provisions set forth in Article 11, the maximum number of shares of Stock thatmay be delivered pursuant to the exercise of Awards granted under the Plan shall be 7,000,000. At no time shall there beoutstanding Awards under the Plan covering more than such maximum number of shares less the aggregate of the shares of Stockpreviously delivered pursuant to the exercise of Options (including the shares of Stock previously covered by Optionssurrendered in connection with the exercise of SARs), the shares of Stock with respect to which stock-settled SARs have beenexercised (without regard to the number of shares of Stock issued upon settlement of such SARs), and the shares of Stockpreviously delivered pursuant to the vesting of Restricted Stock, Restricted Stock Units and Other Stock Unit Awards. The sharesof Stock authorized hereunder shall be in addition to the shares of Stock authorized for grant under the 2006 Avnet, Inc. StockCompensation Plan (the “2006 Plan”), which shall continue to be available for grant under the 2006 Plan. Shares of Stock subjectto Awards may consist of authorized but unissued shares of Stock and/or shares of Stock held in Avnet’s treasury.3.2. Individual Limitations. No Covered Participant may be granted Awards for more than 1,000,000 shares of Stock in anycalendar year, and no individual may be granted Options for more than 500,000 shares of Stock in any calendar year. In addition,no Non-Employee Director may be granted Awards for more than 30,000 shares of Stock in any calendar year; provided, however,that up to 60,000 shares of Stock may be subject to Awards granted to a Non-Employee Director during the calendar year inwhich he first joins the Board of Directors or is first designated as Chairman of the Board of Directors or Lead Director.3.3. Termination and Expiration of Awards. If an Award is surrendered, terminates, or expires, whether in whole or in part, thenumber of shares of Stock covered by such Award immediately before such surrender, termination, or expiration shall thereuponbe added back to the number of shares of Stock otherwise available for further grants of Awards hereunder; provided, however,that the following transactions involving shares of Stock shall not result in shares of Stock becoming available for subsequentAwards: (a) Stock tendered or withheld in payment of the exercise price of an Option; (b) Stock tendered or withheld for taxes; (c)Stock that was subject to a stock-settled SAR or an Option that was related to a SAR and was not issued upon the net settlement ornet exercise of such SAR; and (d) Stock repurchased on the open market with the proceeds of an Option exercise.ARTICLE 4ADMINISTRATION OF THE PLAN 4.1. Plan Administration. This Plan shall be administered by the Administrator. The Administrator shall have full and exclusivepower to: (a) construe and interpret the Plan; (b) establish and amend rules and regulations for the administration of the Plan; and(c) correct any defect, remedy any omission, and reconcile any ambiguity or inconsistency in the Plan or any Award in the mannerand to the extent it deems necessary or desirable to carry out the intent of the Plan and such Award. Subject to Section 4.6, theAdministrator may delegate its authority hereunder to one or more Company officers to the extent permitted by and not inconsistent with any requirements of applicable law.4.2. Committee’s Authority to Grant Awards. In addition to the powers enumerated in Section 4.1 (and without limiting thegenerality thereof), the Committee shall have plenary authority and discretion to determine the time or times at which Awardsshall be granted to Eligible Employees, the Eligible Employees to whom Awards shall be granted, the number of shares of Stockto be covered by each such Award, and (to the extent not inconsistent with the provisions of this Plan) the terms and conditionsupon which each such Award may be exercised. Subject to the requirements of the Plan, the terms and conditions prescribed orapproved for any Agreement with an Eligible Employee shall be entirely within the discretion of the Committee; and nothing inthis Plan shall be deemed to give any Eligible Employee any right to receive Awards.4.3. Independent Directors’ Authority to Grant Awards. In addition to the powers enumerated in Section 4.1 (and withoutlimiting the generality thereof), the Independent Directors shall have plenary authority and discretion to determine the time ortimes at which Awards shall be granted to Non-Employee Directors, the Non-Employee Directors to whom Awards shall begranted, the number of shares of Stock to be covered by each such Award, and (to the extent not inconsistent with the provisionsof this Plan) the terms and conditions upon which each such Award may be exercised; provided that (a) the members of theCommittee shall abstain from participating in any action taken by the Independent Directors with respect to Awards granted or tobe granted to any such members, and (b) no Award shall be granted to a Non-Employee Director unless such grant is approved bya majority of the Non-Employee Directors. Subject to the requirements of the Plan, the terms and conditions prescribed orapproved for any Agreement with a Non-Employee Director shall be entirely within the discretion of the Independent Directors;and nothing in this Plan shall be deemed to give any Non-Employee Director any right to receive Awards.4.4. Actions of the Committee. A majority of the members of the Committee (but not less than two) shall constitute a quorum, andall acts, decisions or determinations of the Committee shall be by majority vote of such of its members as shall be present at ameeting duly held at which a quorum is so present. Any act, decision, or determination of the Committee reduced to writing andsigned by a majority of its members (but not less than two) shall be fully effective as if it had been made, taken or done by vote ofsuch majority at a meeting duly called and held.4.5. Reporting. The Committee shall deliver a report to the Board of Directors with reasonable promptness following the taking ofany action(s) in the administration of this Plan, which report shall set forth in full the action(s) so taken. The Committee shall alsofile such other reports and make such other information available as may from time to time be prescribed by the Board ofDirectors.4.6. CEO Input on Award Determinations. The Committee may request recommendations for individual Awards from the ChiefExecutive Officer of Avnet and, to the extent permitted by applicable law, may delegate to the Chief Executive Officer of Avnetthe authority to make Awards to Participants who are not Executive Officers or Covered Participants, subject to a maximumaggregate Award amount for such a group and a maximum individual Award amount for any one Participant, as determined by theCommittee. However, only the Committee is authorized to grant Awards to Executive Officers and Covered Participants, and theCommittee may not delegate such authority.4.7. Decisions of the Administrator. All determinations and decisions made by the Administrator pursuant to the provisions of thePlan shall be final, conclusive, and binding upon all Persons and the Company, except to the extent that the terms of any sale oraward of shares of Stock or any grant of rights or Options under the Plan are required by law or by the Articles of Incorporation orBylaws of Avnet to be approved by the Board of Directors or shareholders.4.8. Law Compliance. Notwithstanding any other provision of the Plan, the Administrator may impose such conditions on anyAward, and the Board may amend the Plan in any such respects, as the Administrator or the Board determines is necessary ordesirable to avoid adverse consequences under Rule 16b-3, Section 162(m) of the Code, Section 409A of the Code. Section 280Gof the Code, or any other applicable law.ARTICLE 5OPTIONS 5.1. Grant. The Committee may grant Options to Eligible Employees, and the Independent Directors may grant Options to Non-Employee Directors.5.2. Exercise Price. The price per share at which Stock subject to an Option may be purchased shall be determined by theAdministrator, and shall be set forth in the Agreement. In no event shall such exercise price be less than 100% of the Fair MarketValue of the Stock on the Grant Date.5.3. Term. The term of each Option granted under the Plan shall be such period of time as the Administrator shall determine, andshall be set forth in the Agreement; provided, however that, in no event shall an Option be exercisable after the day before thetenth anniversary of the Grant Date. Unless sooner forfeited or otherwise terminated pursuant to the terms hereof or of the Agreement, each Option granted under the Plan shall expire at the end of its term, and the term may not be extended. NoOption granted hereunder may be exercised after the expiration of its term.5.4. Exercisability (Vesting). Each Option granted under the Plan shall become vested and exercisable, in whole or in part, at suchtime or times during its term as set forth in the Agreement; provided, however, that the exercisability of any Option may beaccelerated in whole or in part, at any time, by the Administrator. Subject to the provisions of the Agreement, each Option grantedunder the Plan that has become exercisable pursuant to the preceding sentence shall remain exercisable thereafter until theexpiration of its term as described in Section 5.3.5.5. Exercise. To the extent that an Option has become exercisable in accordance with Section 5.4, such Option may be exercisedby written notice to Avnet stating the number of shares of Stock with respect to which such Award is being exercised,accompanied by payment in full therefor as prescribed below. After receipt of such notice and payment, subject to Section 10.6,Avnet shall either (a) deliver to the Optionee, at the principal office of Avnet or such other place as Avnet may designate, acertificate or certificates representing the shares of Stock acquired upon such exercise, or (b) record the stock transfer on its bookand records without the need to issue a physical certificate. In the discretion of the Administrator, the payment due upon exerciseof an Option may be made (i) by check (certified, if so required by Avnet); (ii) in the form of certificates representing shares ofStock (duly endorsed or accompanied by appropriate stock powers, in either case with signature guaranteed if so required byAvnet) with a Fair Market Value, at the date of receipt by Avnet of such certificates and the notice above mentioned, equal to theaggregate exercise price; (iii) by a combination of check and certificates for shares of Stock; or (iv) in any other manner(including cashless exercise) acceptable to the Administrator.5.6. General Modification Rules. The Administrator may, for such consideration (if any) as it may deem adequate and with theprior consent of the Optionee, modify the terms of any outstanding Option; provided, however, that except to the extentpermitted by Section 5.7, no Option may be repriced, replaced, or regranted through cancellation, or by lowering the exerciseprice of such Option, without shareholder approval.5.7. Special Modification in the Event of a Corporate Transaction. In the event of a corporate transaction (within the meaning ofTreas. Reg. 1.424-1(a)(3)), the Administrator may provide for the assumption or substitution of outstanding Options, providedthat the requirements of Treas. Reg. § 1.424-1(a) are satisfied with respect to Incentive Stock Options, and the requirements ofTreas. Reg. § 1.409A-1(b)(v)(D) are satisfied with respect to all other Options.5.8. Special Rules for Incentive Stock Options (“ISOs”). ISOs shall be subject to the requirements of Section 422 of the Code,including the following (all of which shall be interpreted consistent with the intent to comply with the requirements of Section422 of the Code and not to impose any restrictions that are not required by Section 422):(a) Shares Available for ISO Grants. All shares of Stock authorized for Awards under Article 3 are available to be issuedthrough ISOs; provided, however, that to the extent required by Section 422 of the Code, canceled Awards shall continue to becounted against the number of shares available.(b) Optionee Must Be an Employee. No ISO shall be granted to any individual who is not an employee of Avnet or a Subsidiaryat the time of grant.(c) Special Rules for 10% Owners. An Incentive Stock Option shall not be granted to an individual who, immediately beforethe time the Option is granted, owns shares of Stock possessing more than 10 percent of the total combined voting power of allclasses of stock of Avnet, unless the Agreement for such Incentive Stock Option provides that (i) the exercise price is no lessthan 110 percent (110%) of the Fair Market Value of the Stock on the Grant Date (determined in accordance with Treas. Reg. §1.422-2(f)(1)), and (ii) the Option expires no later than the fifth anniversary of the Grant Date.ARTICLE 6STOCK APPRECIATION RIGHTS (“SARs”) 6.1. Grant. The Committee may grant SARs to Eligible Employees, and the Independent Directors may grant SARs to Non-Employee Directors. Each SAR may be free-standing or related to all or part of an Option. In the discretion of the Administrator, aSAR related to an Option may be granted at any time before the related Option is exercised, expires, is terminated, or issurrendered, and may be modified when the related Option is modified.6.2. Exercise Price. The exercise price per share for each free-standing SAR granted under the Plan shall be determined by theAdministrator, and shall be set forth in the Agreement. In no event shall the exercise price be less than 100% of the Fair MarketValue of the Stock on the Grant Date.6.3. Term. The term of each SAR granted under the Plan shall be such period of time as the Administrator shall determine, andshall be set forth in the Agreement; provided, however that in no event shall a SAR be exercisable after the day before the tenthanniversary of the Grant Date. Unless sooner forfeited or otherwise terminated pursuant to the terms hereof or of the Agreement, each SAR granted under the Plan shall expire at the end of its term, and the term may not be extended. No SARgranted hereunder may be exercised after the expiration of its term.6.4. Exercisability (Vesting). Each SAR shall become vested and exercisable, in whole or in part, at such time or times during itsterm as set forth in the Agreement; provided, however, that (a) the exercisability of any SAR may be accelerated in whole or inpart, at any time, by the Administrator, and (b) if a SAR relates to all or part of an Option, such SAR shall be exercisable only tothe extent that the related Option is exercisable. Subject to the provisions of the Agreement, each SAR that is exercisablepursuant to the preceding sentence shall remain exercisable thereafter until the expiration of its term as described in Section 6.3.6.5. Exercise. To the extent that a SAR has become exercisable in accordance with Section 6.4, such SAR may be exercised inaccordance with the procedures set forth in Section 5.5 (Exercise of Options), but without the requirement to make a paymenttherefor. If the SAR is related to all or part of an Option, the Optionee must provide with the exercise notice an instrumenteffecting the surrender of the related portion of the Option. Each SAR may be settled in shares of Stock, cash, or a combination ofcash and shares. No fractional shares shall be issued; any amount that would have been payable in fractional shares shall be paidin cash.6.6. Other Conditions. The Administrator may impose any other conditions upon the exercise of Stock Appreciation Rights. Suchconditions may govern the right to exercise SARs granted before the adoption or amendment of such conditions as well as SARsgranted thereafter.6.7. Modification Rules. The modification rules and restrictions set forth in Sections 5.6 and 5.7 shall also apply with respect toSARs.ARTICLE 7RESTRICTED STOCK 7.1. Grant. The Committee may grant Restricted Stock to Eligible Employees, and the Independent Directors may grantRestricted Stock to Non-Employee Directors. The number of shares granted pursuant to any Award shall be determined by theAdministrator and set forth in the Agreement.7.2. Restrictions. During the Period of Restriction established by the Administrator and set forth in the applicable Agreement,shares of Restricted Stock shall not be sold, transferred, pledged, assigned, exchanged, encumbered, alienated, hypothecated, orotherwise disposed of. In addition, if a Participant ‘s employment with the Company terminates before the end of the Period ofRestriction for any shares of Restricted Stock, all such restricted shares shall be forfeited, and all rights of the Participant withrespect to such shares of Stock shall immediately terminate without any payment or other consideration therefor. Any forfeitedshares of Restricted Stock that had been delivered to, or held in custody for, a Participant shall be returned to Avnet, accompaniedby any instrument of transfer requested by Avnet.7.3. Lapse of Period of Restriction (Vesting). The Period of Restriction for each Award of Restricted Stock shall lapse uponsatisfaction of conditions established by the Administrator and set forth in the Agreement. Such conditions may be based on (a)continued service to Avnet or a Subsidiary for a specified period, (b) achievement of Performance Objectives, or (c) a combinationof (a) and (b). Except as provided in Section 10.2 (Acceleration of Vesting), the Period of Restriction for any Award that isconditioned (all or in part) on achievement of Performance Objectives shall be no less than one (1) year from the Grant Date, andthe Period of Restriction for any Award that is not conditioned on achievement of Performance Objectives shall lapse no fasterthan pro rata on an annual basis over the three (3) year period that starts on the Grant Date.7.4. Settlement of Restricted Stock. Shares of Restricted Stock shall become freely transferable immediately following the last dayof the Period of Restriction. As soon as practicable after the Period of Restriction lapses, certificates for any shares of RestrictedStock that have not already been delivered to the Participant shall be so delivered, at the principal office of Avnet (or such otherplace as Avnet may designate), or Avnet may record the stock transfer on its book and records without the need to issue a physicalcertificate.7.5. Voting Rights. During the Period of Restriction, Participants in whose name Restricted Stock is granted under the Plan mayexercise full voting rights with respect to those shares.7.6. Dividend Rights. During the Period of Restriction, Participants in whose name Restricted Stock is granted shall be entitled toreceive all dividends and other distributions paid with respect to such Awards, as set forth in this Section 7.6. Dividends paid incash shall be automatically reinvested in additional shares of Restricted Stock at a purchase price per share equal to Fair MarketValue of a share of Stock on the date of such dividend is paid; provided, however fractional shares shall not be issued. Anyamount that would have been invested in a fractional share shall be payable to the Participant in cash when the Period ofRestriction for the underlying shares lapses. All additional shares of Stock received by a Participant in respect of a dividend orother distribution on Restricted Stock, whether through reinvestment or through a dividend or other distribution paid in shares of Stock, shall be subject to the same restrictions (for the same Period of Restriction) as the RestrictedStock with respect to which they were received; and the right to receive cash with respect to any fractional share shall be subjectto forfeiture until the Period of Restriction for the underlying shares lapses.7.7. Foreign Laws. Notwithstanding any other provision of the Plan, if Restricted Stock is to be awarded to a Participant who issubject to the laws, including the tax laws, of any country other than the United States, the Committee may, in its discretion,direct Avnet to sell, assign, or otherwise transfer the Restricted Stock to a trust or other entity or arrangement, rather than grant theRestricted Stock directly to the Participant.ARTICLE 8RESTRICTED STOCK UNITS 8.1. Grant. The Committee may grant Restricted Stock Units to Eligible Employees, and the Independent Directors may grantRestricted Stock Units to Non-Employee Directors. The number of shares of Stock underlying any Restricted Stock Unit Awardshall be determined by the Administrator and set forth in the Agreement.8.2. Vesting. An Award of Restricted Stock Units shall be subject to vesting conditions established by the Administrator and setforth in the applicable Agreement. Such vesting conditions may be based on (a) continued service to Avnet or a Subsidiary for aspecified period, (b) achievement of Performance Objectives, or (c) a combination of (a) and (b). Except as provided in Section10.2 (Acceleration of Vesting), (i) if vesting of the Award is conditioned (all or in part) on achievement of PerformanceObjectives, the Award shall not become vested before the first anniversary of the Grant Date, and (ii) if vesting of the Award is notconditioned on achievement of Performance Objectives, the Award shall become vested no faster than pro rata on an annual basisover the three (3) year period that starts on the Grant Date. If a Participant’s employment with the Company terminates before hisAward becomes fully vested, the unvested portion of such Award shall be forfeited.8.3. Settlement of Restricted Stock Units. Subject to Section 10.6, as soon as practicable after any Restricted Stock Unit becomesvested, Avnet shall transfer to the Participant one share of Stock for each such vested Restricted Stock Unit, cash in lieu of sharesof Stock, or a combination of cash and shares of Stock. No fractional shares shall be issued with respect to vesting of RestrictedStock Units.8.4. Dividend Rights. Participants in whose name Restricted Stock Units are granted shall not be entitled to receive dividends orother distributions with respect to shares of Stock underlying such Restricted Stock Unit, unless the Agreement providesotherwise. Any right to receive dividends or other distributions shall be subject to the same vesting conditions and risk offorfeiture as the Restricted Stock Units with respect to which such right is granted, and all dividends and distributions shall bepaid when the applicable Restricted Stock Units are settled.ARTICLE 9OTHER STOCK UNIT AWARDS 9.1. Grant. The Committee may grant Other Stock Unit Awards to Eligible Employees, and the Independent Directors may grantOther Stock Unit Awards to Non-Employee Directors. Each Other Stock Unit Award may be granted as a stand-alone Award or inconnection with another Award made under the Plan, and may be in the form of Stock or other securities. The number of shares ofStock or other securities underlying any Other Stock Unit Award shall be determined by the Administrator and set forth in theAgreement.9.2. Amount of Award. The value of each Other Stock Unit Award shall be based, in whole or in part, on the value of theunderlying Stock or other securities. The Administrator, in its sole and complete discretion, may determine that an Other StockUnit Award may provide to the Participant (a) dividends or dividend equivalents (to the extent provided in the applicableAgreement) and (b) cash payments in lieu of or in addition to an Award.9.3. General Rules for Other Stock Unit Awards. Subject to the requirements of the Plan, including this Section 9.3, theAdministrator shall have sole and complete discretion to determine the terms, restrictions, conditions, vesting requirements, andpayment rules of an Other Stock Unit Award (collectively, the “Rules”). The Rules for each Other Stock Unit Award shall be setforth in the Award Agreement. Each Other Stock Unit Award need not be subject to identical Rules.(a) An Other Stock Unit Award shall be subject to vesting conditions established by the Administrator and set forth in theapplicable Agreement. Such vesting conditions may be based on any criterion permitted by Section 8.2; provided that, exceptas provided in Section 10.2 (Acceleration of Vesting), the minimum vesting period required by Section 8.2 shall also apply forOther Stock Unit Awards.(b) An Other Stock Unit Award may be contingent on the payment of cash consideration by the Participant upon receipt of theAward or provide that the Award, and any Stock or other securities issued in conjunction with the Award, be delivered withoutthe payment of cash consideration. (c) An Other Stock Unit Award may be subject to a deferred payment schedule, if so set forth in the Agreement.(d) The Administrator, in its sole and complete discretion, as a result of certain circumstances, including the assumption of, orsubstitution of stock unit awards of a company with which Avnet or a Subsidiary participates in an acquisition, separation, orsimilar corporate transaction, may waive or otherwise remove, in whole or in part, any restriction or condition imposed on anOther Stock Unit Award at the time of grant.ARTICLE 10ADDITIONAL TERMS AND PROVISIONS 10.1. Agreements. Promptly after the granting of any Award or the modification of any outstanding Award, the Administrator shallcause such Participant to be notified of such action and shall cause Avnet to deliver to such Participant an Agreement (whichAgreement shall be signed on behalf of Avnet by an officer of Avnet with appropriate authorization therefor) evidencing theAward so granted or modified and the terms and conditions thereof and including (when appropriate) an addendum evidencingthe SAR so granted or modified and the terms and conditions thereof.10.2. Acceleration of Vesting. The Administrator, in its sole discretion, may accelerate the vesting of any Award (including thelapsing of the Period of Restriction for Restricted Stock), or remove conditions for vesting (or lapsing of the Period of Restriction)upon a Change in Control or the Participant’s death, retirement, layoff, separation from service in connection with a Change inControl, or other separation from service where the Administrator determines that such treatment is appropriate and in theCompany’s best interests, as well as upon assumption of, or in substitution for equity awards of a company with which Avnet or aSubsidiary participates in an acquisition, separation, merger, or similar corporate transaction; provided, however, that with respectto an Award to a Covered Participant that is intended to qualify as “other performance-based compensation,” waiver ofperformance conditions shall be permitted only to the extent permitted by Revenue Ruling 2008-13 or any successor thereto. Inaddition, the Administrator may grant awards of Restricted Stock, Restricted Stock Units, and Other Stock Unit Awards that donot satisfy the minimum vesting periods and Periods of Restriction prescribed by Sections 7.3, 8.2, and 9.3(a); provided, however,that the total number of shares of Stock underlying Awards that do not satisfy such minimum vesting periods and Periods ofRestriction shall not exceed five percent (5%) of the total number of shares available for grant under the Plan.10.3. Tax Withholding. The Company shall have the right to deduct from all amounts paid to a Participant or beneficiary anytaxes required by law to be withheld in respect of Awards under the Plan. In the case of an Award settled in shares of Stock, noshares of Stock shall be issued, and no election under Section 83(b) of the Code shall be accepted, unless and until arrangementssatisfactory to the Company have been made to satisfy any applicable withholding tax obligations. Without limiting thegenerality of the foregoing and subject to such terms and conditions as the Committee may impose, the Company shall have theright to (a) retain shares of Stock or (b) subject to such terms and conditions as the Committee may establish from time to time,allow Participants or beneficiaries to (i) tender shares of Stock (including shares of Stock issuable in respect of an Award) tosatisfy, in whole or in part, the amount required to be withheld, or (ii) pay the required withholding amount to Avnet in cash. Forpurposes of determining the number of shares of Stock required to satisfy a withholding obligation, the Fair Market Value shallbe calculated as of the date that the amount to be withheld is determined. A Participant or beneficiary shall pay Avnet cash forany fractional share that would otherwise be required to be withheld. Regardless of the amount withheld, each Participant andbeneficiary shall be responsible at all times for paying all federal, state, and local income and employment taxes due with respectto any Award (including taxes due with respect to imputed income), and the Company shall not be responsible for any interest orpenalty that a Participant incurs by failing to make timely payments of tax.10.4. No Right to Employment. The Plan shall not confer upon any Participant or other individual any right with respect tocontinuance of employment by the Company or continuance of membership on the Board of Directors, nor shall it interfere in anyway with his right, or the Company’s right, to terminate his employment or Board membership at any time.10.5. Shareholder Rights. Except provided in Article 7 with respect to Restricted Stock, no Participant shall acquire or have anyrights as a shareholder of Avnet by virtue of any Award until the certificates representing shares of Stock issued pursuant to theAward or the exercise thereof are delivered to such Participant or otherwise recorded in the books and records of Avnet inaccordance with the terms of the Plan. Subsequent to such delivery of Stock certificates or recordation in the books and records ofAvnet, the recipient of shares of Stock shall have the full rights of a holder of such Stock.10.6. Registration of Shares. It is Avnet’s present intention to register under the Securities Act. Avnet shall not be obligated tosell or deliver any shares of Stock pursuant to the granting or exercise of any Award unless and until—(a) either (i) Avnet has received from its counsel an opinion concluding that such shares need not be registered under theExchange Act, or (ii) (A) Such shares have been registered under the Securities Act, (B) no stop order suspending theeffectiveness of such registration statement has been issued and no proceedings therefor have been instituted or threatened under said Act, and (C) there is available at the time of such grant and/or exercise a prospectus containing certified financialstatements and other information meeting the requirements of Section 10(a)(3) of said Act;(b) such shares are (or upon official notice of issuance will be) listed on each national securities exchange on which the Stock isthen listed;(c) the prior approval of such delivery has been obtained from any State regulatory body having jurisdiction (but nothingherein contained shall be deemed to require Avnet to register or qualify as a foreign corporation in any State nor, except as toany matter or transaction relating to the sale or delivery of such shares, to consent in service of process in any State); and(d) if the Committee so requires, Avnet has received an opinion from its counsel with respect to compliance with the matters setforth in subsections (a), (b), and/or (c) of this Section 10.6. In addition, the making of any Award or determination, the deliveryor recording of a stock transfer, and payment of any amount due to a Participant may be postponed for such period as Avnetmay require, in the exercise of reasonable diligence, to comply with the requirements of any applicable law.10.7. Document Requirements. The Committee may require, as a condition of any payment or share issuance, that certainagreements, undertakings, representations, certificates, and/or information, as the Committee may deem necessary or advisable, beexecuted or provided to the Company to assure compliance with all applicable laws. Any certificates for shares of Stock deliveredunder the Plan may be subject to such stock-transfer orders and other restrictions as the Committee may deem advisable under therules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Stockis then listed, and any applicable federal or state securities law.10.8. Deferrals. The Administrator may allow a Participant to elect to defer receipt of any payment of cash or any delivery ofshares of Stock that would otherwise be due to such Participant by virtue of the exercise, earn-out, or settlement of any Awardmade under the Plan, other than Options or Stock Appreciation Rights. If such election is permitted, the Committee shall establishrules and procedures for such deferrals, including provisions that the Committee or the Participant determines are necessary oradvisable to comply with, or avoid being subject to, the requirements of Section 409A of the Code, and provisions for thepayment or crediting of dividend equivalents in respect of deferrals credited in units of Stock.10.9. Nontransferability. Except as otherwise provided in Section 7.7, this Section 10.9, or the applicable Agreement, no Awardgranted under the Plan, and no interests therein, may be sold, transferred, pledged, assigned, exchanged, encumbered or otherwisealienated or hypothecated; and each Award shall be exercisable during the Participant’s lifetime only by the Participant or hislegal guardian or representative.(a) An Award may be transferred by testamentary disposition or the laws of descent and distribution.(b) The Committee shall have sole discretion to approve, and to establish terms and conditions for, a transfer of an Option otherthan an Incentive Stock Option to (i) the child, step-child, grandchild, parent, stepparent, grandparent, spouse, former spouse,sibling, niece, nephew, mother-in-law, son-in-law, daughter-in-law, brother-in-law, sister-in-law, including adoptiverelationships, and any person sharing the Participant’s household (other than a tenant or employee) of the Participant (an“Immediate Family Member”); (ii) a trust in which Immediate Family Members have more than fifty percent of the beneficialinterest; (iii) a foundation in which Immediate Family Members or the Employee control the management of the assets; or (iv)any other entity in which Immediate Family Members or the Employee own more than 50% of the voting interests; provided,however, that, without the prior approval of the Committee, no Permitted Transferee shall further transfer an Award, eitherdirectly or indirectly, other than by testamentary disposition or the laws of descent and distribution. For example, without priorapproval of the Committee, a Permitted Transferee may not transfer an Award by reason of the dissolution of, or a change in thebeneficiaries of, a Permitted Transferee that is a trust; the sale, merger, consolidation, dissolution, or liquidation of a PermittedTransferee that is a partnership (or the sale of all or any portion of the partnership interests therein); or the sale, merger,consolidation, dissolution or liquidation of a Permitted Transferee that is a corporation (or the sale of all or any portion of thestock thereof).(c) The Committee shall have discretion to authorize a transfer pursuant to a domestic relations order; provided, however, thatthe Committee shall not be required under any circumstance to accept or approve a transfer pursuant to a domestic relationsorder.10.10. Applicable Law and Severability. The Plan, and its rules, rights, agreements and regulations, shall be governed, construed,interpreted and administered solely in accordance with the laws of the state of New York, without regard to any conflicts orchoice of law rule or principle that might otherwise refer construction or interpretation of the Plan to the substantive law ofanother jurisdiction. If any provision of the Plan is held invalid, illegal, or unenforceable, in whole or in part, for any reason, suchdetermination shall not affect the validity, legality or enforceability of any remaining provision, portion of provision or the Planoverall, which shall remain in full force and effect as if such invalid, illegal or unenforceable provision (or portion thereof) hadnever been included in the Plan. 10.11. Special Incentive Compensation. No shares of Stock or other remuneration provided pursuant to an Award shall beincluded in compensation for purposes of determining the amount payable to any individual under any pension, savings,retirement, life insurance, or other employee benefits arrangement of the Company, unless otherwise determined by the Company.10.12. Legends. In its sole and complete discretion, the Committee may elect to legend certificates representing shares of Stocksold or awarded under the Plan, to make appropriate references to the restrictions imposed on such shares.10.13. Section 16(b) of the Exchange Act. All Agreements for Participants subject to Section 16(b) of the Exchange Act shall bedeemed to include any such additional terms, conditions, limitations and provisions as Rule 16b-3 requires, unless theCommittee in its discretion determines that any such Award should not be governed by Rule 16b-3. In addition, with respect topersons subject to Section 16(b) of the Exchange Act, transactions under the Plan are intended to comply with all applicableconditions of Rule 16b-3. To the extent that any provision of the Plan or any action by the Administrators fails to comply withRule 16b-3, it shall be deemed null and void, to the extent permitted by law and deemed advisable by the Committee.10.14. Section 162(m) of the Code. Each Award to a Covered Participant that is contingent upon the achievement of PerformanceObjectives shall be deemed to include any such additional terms, conditions, limitations, and other provisions as are necessary forsuch Award to qualify as “other performance-based compensation” within the meaning of Section 162(m)(4)(C) of the Code,unless the Committee in its discretion determines that such Award is not intended to qualify as “other performance-basedcompensation.” Performance Objectives for each Award granted to a Covered Employee shall be measured either annually orcumulatively over a period of years, on an absolute basis or relative to a pre-established target, as specified by the Committee inthe Agreement. The Performance Objectives for each Award that is intended to qualify as “other performance-basedcompensation” shall be set forth in writing no later than 90 days after commencement of the period of service (within the meaningof Treas. Reg. §1.162-27(e)(2)(i)) to which the Performance Objectives relate (or, if sooner, before 25 percent (25%) of such periodof service has elapsed), at a time when achievement of the Performance Objectives is substantially uncertain. To the extentpermitted by Section 162(m)(4)(C) of the Code, the Committee may adjust performance results to take into account extraordinary,unusual, non-recurring, or non-comparable items, and shall have discretion to reduce the amount due upon attainment of anyPerformance Objective. No amount shall be paid to a Covered Employee pursuant to an Award that is contingent upon theachievement of Performance Objectives unless and until the Committee has certified that the Performance Objectives have beensatisfied. To the extent required by Section 162(m) of the Code, canceled Awards shall continue to be counted against the limitset forth in Section 3.2 on shares of Stock available for Awards.10.15. Section 409A of the Code. The Plan, any Award granted under the Plan, and all Agreements evidencing such Awards, shallbe interpreted, administered, and construed consistent with the intent that (a) all options, SARs, and comparable awards shall beexempt from Section 409A of the Code by reason of the exemption for certain stock rights set forth in Treas. Reg. § 1.409A-1(b)(5); (b) all Awards of Restricted Stock shall be exempt from Section 409A of the Code by reason of the exemption for restrictedproperty governed by Section 83 of the Code set forth in Treas. Reg. § 1.409A-1(b)(6); (c) all Restricted Stock Unit Awards shallbe exempt from Section 409A of the Code by reason of the “short-term deferral rule” set forth in Treas. Reg. § 1.409A-1(b)(4); and(d) and all Other Stock Unit Awards shall be exempt from Section 409A of the Code by reason of one of the provisions referencedin clause (a), (b), or (c), except (with respect to each type of Award) to the extent that the applicable Agreement clearly sets forthan intent to provide for nonqualified deferred compensation that is subject to the requirements of Section 409A.10.16. Application of Proceeds. The proceeds received by the Company from the sale of Shares under the Plan shall be used forgeneral corporate purposes.10.17. Rules of Construction. Whenever used in the Plan, (a) words in the masculine gender shall be deemed to refer to females aswell as to males; (b) words in the singular shall be deemed to refer also to the plural; (c) the word “include” shall mean “includingbut not limited to”; (d) references to a statute or regulation or statutory or regulatory provision shall refer to that provision (or to asuccessor provision of similar import) as currently in effect, as amended, or as reenacted, and to any regulations and other formalguidance of general applicability issued thereunder; and (e) references to a law shall include any statute, regulation, rule, courtcase, or other requirement established by an exchange or a governmental authority or agency, and applicable law shall includeany tax law that imposes requirements in order to avoid adverse tax consequences.10.18. Headings and Captions. The headings and captions in this Plan document are provided for reference and convenienceonly, shall not be considered part of the Plan, and shall not be employed in the construction of the Plan.10.19. Effective Date. The Plan shall become effective on the date the Plan is approved by Avnet’s shareholders. ARTICLE 11ADJUSTMENTS UPON CHANGES IN CAPITALIZATION 11.1. Share Adjustments. If the Stock is split, divided, or otherwise reclassified into or exchanged for a greater or lesser number ofshares of Stock or into shares of Stock and/or any other securities of Avnet by reason of recapitalization, reclassification, stocksplit or reverse split, combination of shares or other reorganization, the term “Stock” as used herein shall thereafter mean thenumber and kind of shares or other securities into which the Stock shall have been so split, divided or otherwise reclassified or forwhich the Stock shall have been so exchanged; and the remaining number of shares of Stock which may, in the aggregate,thereafter be delivered pursuant to the grant or exercise of an Award and the remaining number of shares of Stock which maythereafter be delivered pursuant to the exercise of any Options and/or Stock Appreciation Rights then outstanding, shall becorrespondingly adjusted. If a dividend payable in shares of Stock is paid to the holders of outstanding shares of Stock, theremaining number of shares of Stock which may, in the aggregate, thereafter be delivered pursuant to the exercise or grant ofAwards, and the remaining number of shares of Stock that may thereafter be delivered pursuant to the exercise of any Awards thenoutstanding shall be increased by the percentage that the number of shares of Stock so paid as a dividend bears to the totalnumber of shares of Stock outstanding immediately before the payment of such dividend. If an extraordinary cash dividend ispaid to the holders of outstanding shares of Stock, the remaining number of shares of Stock that may, in the aggregate, thereafterbe delivered pursuant to the exercise or grant of Awards and the remaining number of shares of Stock that may thereafter bedelivered pursuant to the exercise of any Awards then outstanding, shall be equitably adjusted by the Committee.11.2. Exercise Price Adjustments. If the Stock is split, divided or otherwise reclassified or exchanged, or that any dividendpayable in shares or Stock or extraordinary cash dividend is paid to the holders of outstanding shares of Stock, in each case, asprovided in the preceding paragraph, the purchase price per share of Stock upon exercise of outstanding Options, and theaggregate number of shares of Stock with respect to which Awards may be granted to any Participant in any calendar year, shallbe correspondingly adjusted.11.3. Fractional Shares. Notwithstanding any other provision of this Article 11, if upon any adjustment made in accordance withSection 11.1 above, the remaining number of shares of Stock which may thereafter be delivered pursuant to the exercise of anyAward then outstanding shall include a fractional share of Stock, such fractional share of Stock shall be disregarded for allpurposes of the Plan and the Optionee holding such Award shall become entitled neither to purchase the same nor to receive cashor scrip in payment therefor or in lieu thereof.ARTICLE 12AMENDMENT OR TERMINATION OF THE PLAN 12.1. The Plan shall automatically terminate on November 4, 2020, unless it is sooner terminated pursuant to Section 12.2, below.No Award shall be granted after the Plan terminates. All Awards granted before the Plan terminates shall continue in effectthereafter in accordance with the terms of the applicable Agreements and the Plan.12.2. Reservation of Rights. The Board of Directors may amend or terminate the Plan at any time as the Board may deemadvisable and in the best interests of Avnet; provided, however, that the terms of an outstanding Award shall not be changedwithout written consent of the Participant and, unless approved by the affirmative vote of a majority of the votes cast at a meetingof the shareholders of Avnet duly called and held for that purpose, no amendment to the Plan shall be adopted which shall (a)affect the composition or functioning of the Committee; (b) increase the aggregate number of shares of Stock that may bedelivered pursuant to the exercise of Awards; (c) increase the aggregate number of shares of Stock with respect to which Optionsor other Awards may be granted to any Participant during any calendar year; (d) decrease the minimum purchase price per share ofStock (in relation to the Fair Market Value thereof at the respective dates of grant) upon the exercise of Options; or (e) extend theten-year maximum period within which an Award is exercisable or the termination date of the Plan. Exhibit 12.1 Avnet, Inc.Computation of Ratios of Earnings to Fixed Charges Fiscal Years Ended June 30, July 1, July 2, June 27, June 28, 2018 2017 2016 2015 2014 (in thousands) Earnings: Income from continuing Operations before tax 145,077 310,404 478,013 571,511 529,952 Add fixed charges 127,527 130,629 114,170 111,318 117,970 Total Earnings 272,604 441,033 592,183 682,829 647,922 Fixed charges: Interest on indebtedness including amortization of debt expense 102,525 106,691 91,936 87,080 91,206 Interest component of rent expense 25,002 23,938 22,234 24,238 26,764 Total fixed charges 127,527 130,629 114,170 111,318 117,970 2.1 3.4 5.2 6.1 5.5 Exhibit 21Avnet, Inc. Foreign and Domestic SubsidiariesCompany NameCountryAbacus Group LimitedUnited KingdomAlpha 3 Manufacturing LtdUnited KingdomAVID Technologies, Inc.United StatesAvnet (Asia Pacific Holdings) LimitedHong KongAvnet (Holdings) LtdUnited KingdomAvnet (NZ)New ZealandAvnet (Shanghai) LimitedChinaAvnet Abacus LimitedHong KongAvnet Asia Pte LtdSingaporeAvnet ASIC Israel LtdIsraelAvnet B.V.NetherlandsAvnet Bidco LimitedUnited KingdomAvnet Components Israel LimitedIsraelAvnet Delaware Holdings, Inc.United StatesAvnet Delaware LLCUnited StatesAvnet do Brasil Ltda.BrazilAvnet Electronics Marketing (Australia) Pty LtdAustraliaAvnet Electronics Technology (China) LimitedChinaAvnet Electronics Technology (Shenzhen) LimitedChinaAvnet Electronics Turkey İthalat İhracat Sanayi ve Ticaret Limited ŞirketiTurkeyAvnet EMRussian FederationAvnet EM Holdings (Japan) Kabushiki KaishaJapanAvnet EM Sp. z.o.o.PolandAvnet EMG AGSwitzerlandAvnet EMG Elektronische Bauelemente GmbHAustriaAvnet EMG FranceFranceAvnet EMG GmbHGermanyAvnet EMG Italy S.r.l.ItalyAvnet EMG LtdUnited KingdomAvnet Erste Verwaltungs GmbHGermanyAvnet Europe Comm. VABelgiumAvnet Europe Executive BVBABelgiumAvnet Finance B.V.NetherlandsAvnet Finance International S.à r.l.LuxembourgAvnet Finance S.à r.l.LuxembourgAvnet Financial Services Asia LimitedHong KongAvnet France S.A.S.FranceAvnet Group Holdings LimitedUnited KingdomAvnet Holding Europe BVBABelgiumAvnet Holding Germany GmbHGermany Avnet Holding South Africa (Pty) LimitedSouth AfricaAvnet Holdings UK LimitedUnited KingdomAvnet Holdings, LLCUnited StatesAvnet Iberia S.A.SpainAvnet India Private LimitedIndiaAvnet International Holdings 1 BVBABelgiumAvnet International (Canada) Ltd.CanadaAvnet International Holdings 2 BVBABelgiumAvnet International Holdings UK LimitedUnited KingdomAvnet International, LLCUnited StatesAvnet Japan (Asia) LimitedSingaporeAvnet Japan (Thailand) Co., Ltd.ThailandAvnet Kabushiki KaishaJapanAvnet Korea, Inc.Korea, Republic ofAvnet LimitedIrelandAvnet Logistics B.V.B.A.BelgiumAvnet Logistics GmbHGermanyAvnet Logistics LimitedUnited KingdomAvnet Logistics Stutensee GmbHGermanyAvnet Malaysia Sdn BhdMalaysiaAvnet Nortec A/SDenmarkAvnet Nortec ABSwedenAvnet Nortec ASNorwayAvnet Nortec OyFinlandAvnet Philippines Pty Ltd., Inc.PhilippinesAvnet Receivables CorporationUnited StatesAvnet Schweiz GmbHSwitzerlandAvnet SellCo B.V.NetherlandsAvnet South Africa (Pty) LimitedSouth AfricaAvnet Sunrise LimitedHong KongAvnet Technology (Thailand) Ltd.ThailandAvnet Technology Electronics Marketing (Taiwan) Co., Ltd.TaiwanAvnet Technology Hong Kong LimitedHong KongAvnet Technology Solutions (China) LtdChinaAvnet Technology Solutions (Tianjin) LtdChinaAvnet Technology Solutions B.V. (Sold 02/27/2017)NetherlandsAvnet, Inc.United StatesAVT Holdings LLCUnited StatesBeijing Vanda Yunda IT Services Co., LtdChinaBell Microproducts Brazil Holdings, LLCUnited StatesBell Microproducts Mexico Shareholder, LLCUnited StatesCELDIS LIMITEDUnited KingdomCM Satellite Systems, Inc.United StatesCOMBINED PRECISION COMPONENTS LIMITEDUnited KingdomDragon Innovation (HK) LimitedHong KongDragon Innovation Consulting (Shenzhen) Company LimitedChinaEBV Beteiligungs-Verwaltungs GmbHGermanyEBV Elektronik ApSDenmark EBV Elektronik d.o.o.SerbiaEBV Elektronik EOODBulgariaEBV Elektronik GmbH & Co. KGGermanyEBV Elektronik International GmbHGermanyEBV Elektronik KftHungaryEBV Elektronik LimitedHong KongEBV Elektronik MRussian FederationEBV Elektronik Maatschap (Dissolved 04/15/2013)BelgiumEBV Elektronik OÜEstoniaEBV Elektronik S.r.l.ItalyEBV Elektronik S.R.L.RomaniaEBV Elektronik s.r.o.SlovakiaEBV Elektronik SASFranceEBV Elektronik sp. z o.o.PolandEBV Elektronik Spain S.L.SpainEBV Elektronik spol. s r.o.Czech RepublicEBV Elektronik Ticaret Limited SirketiTurkeyEBV Elektronik TOVUkraineEBV Elektronik, Druzba Za Posredovanje D.O.O.SloveniaEBV Elektronik, Unipessoal Lda,PortugalEBV Erste Holding GmbH & Co. KGGermanyEBV Management GmbHGermanyEBV Zweite Holding GmbH & Co. KGGermanyEBV-Elektronik GmbHAustriaElectrolink (PTY) LtdSouth AfricaElectron House (Overseas) LimitedUnited Kingdomelement 14 LimitedUnited Kingdomelement 14 sp. zooPolandelement14 Asia Pte. Ltd.Singaporeelement14 Co., Ltd.ThailandElement14 de Mexico, S. de R.L de C.VMexicoelement14 Electronics LimitedIrelandElement14 Finance UK LimitedUnited Kingdomelement14 Holding BVNetherlandselement14 India Pvt LimitedIndiaelement14 LimitedHong Kongelement14 LimitedNew Zealandelement14 Ltd.Korea, Republic ofelement14 Pte. Ltd.Singaporeelement14 Pty LtdAustraliaelement14 SDN. BHD.MalaysiaElement14 US Holdings Inc.United StatesElement14 US Holdings LLCUnited StatesELEMENT14. S. de R.L. de C.VMexicoeluomeng Electronics (China) Co. LtdChinaELUOMENG LIMITEDHong KongELUOMENG LIMITED COMPANYTaiwanErste TENVA Property GmbH Gruber StraßeGermany FARNELL (BELGIUM) N.V.BelgiumFARNELL (FRANCE) SASFranceFARNELL (NETHERLANDS) B.V.NetherlandsFARNELL AGSwitzerlandFARNELL COMPONENTS (IRELAND) LIMITEDIrelandFARNELL COMPONENTS (ISRAEL) LTDIsraelFARNELL COMPONENTS ABSwedenFARNELL COMPONENTS SLSpainFARNELL DANMARK A/SDenmarkFARNELL ELECTRONIC COMPONENTS LIMITEDUnited KingdomFARNELL GMBHGermanyFARNELL HOLDING LIMITEDUnited KingdomFARNELL ITALIA SRLItalyFARNELL OVERSEASUnited KingdomICATI Beteiligungs-Verwaltungs GmbHGermanyICATI Verwaltungs GmbHGermanyImport Holdings LLCUnited StatesINONE HOLDINGS LIMITEDUnited KingdomKent One CorporationUnited StatesMCM ELECTRONICS, INC.United StatesMemec (NZ) LimitedNew ZealandMemec Group Holdings LimitedUnited KingdomMemec Group LimitedUnited KingdomMemec Holdings LimitedUnited KingdomMemec Pty LimitedAustraliaMexico Holdings LLCUnited StatesMicrocomputers Systems Components Nederland B.V.NetherlandsMSC (Malta) LimitedMaltaMSC Technologies GmbHGermanyMSC Technologies Systems GmbHGermanyNEWARK CORPORATIONUnited StatesNEWARK ELECTRONICS CORPORATIONUnited StatesOY FARNELL (FINLAND) ABFinlandPREMIER FARNELL (SCOTLAND) LIMITEDUnited KingdomPREMIER FARNELL CANADA LIMITEDCanadaPREMIER FARNELL CORP.United StatesPREMIER FARNELL FINANCE LIMITEDIrelandPREMIER FARNELL HOLDING INC.United StatesPREMIER FARNELL LIMITEDUnited KingdomPREMIER FARNELL PENSION FUNDING SCOTTISH LIMITED PARTNERSHIPUnited KingdomPREMIER FARNELL PENSION TRUSTEES LIMITEDUnited KingdomPREMIER FARNELL PROPERTIES INC.United StatesPREMIER FARNELL UK LIMITEDUnited KingdomPREMIER INDUSTRIAL HOLLAND B.V.NetherlandsPride Well LimitedVirgin Islands, BritishRTI Holdings LimitedHong KongSEC International Holding Company II, L.L.C.United StatesShanghai FR International Trading Co., Ltd.China SHENZHEN EMBEST TECHNOLOGY CO., LTD.ChinaSociété Civile Immobilière du 22 rue de DamesFranceSource Electronics (HK) LimitedHong KongSource Electronics (Shanghai) LimitedChinaSource Electronics Asia LimitedHong KongTekdata Interconnections LimitedUnited KingdomTelmil Electronics, Inc.United StatesTenva Belgium Comm. VABelgiumTenva Financial Management B.V.B.A.BelgiumTenva Group Holdings Europe LimitedUnited KingdomTenva Properties BVBABelgiumThomas Kaubisch GmbHGermanyVanda Computer System Integration (Shanghai) Company LimitedChinaVenezuelan Partner B.V.NetherlandsYEL Electronics (China) LimitedHong KongYEL Electronics (Shanghai) LimitedChinaYEL Electronics (Shenzhen) LtdChinaYEL Electronics Hong Kong LimitedHong KongZWEITE TENVA Property GmbH Im TechnologieparkGermany Exhibit 23.1 Consent of Independent Registered Public Accounting Firm The Board of DirectorsAvnet, Inc.: We consent to the incorporation by reference in the registration statement Nos. 333-45267, 333-112062, 333-140903, 333-171291, 333-177787, 333-192289, 333-214887, and 333-220133 on Form S-8 and 333-208009 on Form S-3 of Avnet, Inc.of our report dated August 17, 2018, with respect to the consolidated balance sheets of Avnet, Inc. and subsidiaries as of June30, 2018 and July 1, 2017, and the related consolidated statements of operations, comprehensive income, shareholders’equity, and cash flows for each of the years in the three-year period ended June 30, 2018, and the related notes and financialstatement schedule (collectively, the “consolidated financial statements”), and the effectiveness of internal control overfinancial reporting as of June 30, 2018, which report appears in the June 30, 2018 annual report on Form 10-K of Avnet, Inc. /s/ KPMG LLP Phoenix, ArizonaAugust 17, 2018 Exhibit 31.1 CERTIFICATION OF CHIEF EXECUTIVE OFFICER I, William J. Amelio, certify that: 1.I have reviewed this annual report on Form 10-K of Avnet, Inc.; 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state amaterial fact necessary to make the statements made, in light of the circumstances under which such statements weremade, not misleading with respect to the period covered by this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairlypresent in all material respects the financial condition, results of operations and cash flows of the registrant as of, andfor, the periods presented in this report; 4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controlsand procedures (as such term is defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control overfinancial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: a.designed such disclosure controls and procedures, or caused such disclosure controls and procedures to bedesigned under our supervision, to ensure that material information relating to the registrant, including itsconsolidated subsidiaries, is made known to us by others within those entities, particularly during the periodin which this report is being prepared; b.designed such internal control over financial reporting, or caused such internal control over financialreporting to be designed under our supervision, to provide reasonable assurance regarding the reliability offinancial reporting and the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles; c.evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this reportour conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the periodcovered by this report based on such evaluation; and d.disclosed in this report any change in the registrant's internal control over financial reporting that occurredduring the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annualreport) that has materially affected, or is reasonably likely to materially affect, the registrant's internalcontrol over financial reporting; and 5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internalcontrol over financial reporting, to the registrant's auditors and the audit committee of the registrant's board ofdirectors (or persons performing equivalent functions): a.all significant deficiencies and material weaknesses in the design or operation of internal control overfinancial reporting which are reasonably likely to adversely affect the registrant's ability to record, process,summarize and report financial information; and b.any fraud, whether or not material, that involves management or other employees who have a significantrole in the registrant's internal control over financial reporting. Date: August 17, 2018 /s/ WILLIAM J. AMELIO William J. Amelio Chief Executive Officer Exhibit 31.2 CERTIFICATION OF CHIEF FINANCIAL OFFICER I, Thomas Liguori, certify that: 1.I have reviewed this annual report on Form 10-K of Avnet, Inc.; 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state amaterial fact necessary to make the statements made, in light of the circumstances under which such statements weremade, not misleading with respect to the period covered by this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairlypresent in all material respects the financial condition, results of operations and cash flows of the registrant as of, andfor, the periods presented in this report; 4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controlsand procedures (as such term is defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control overfinancial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: a.designed such disclosure controls and procedures, or caused such disclosure controls and procedures to bedesigned under our supervision, to ensure that material information relating to the registrant, including itsconsolidated subsidiaries, is made known to us by others within those entities, particularly during theperiod in which this report is being prepared; b.designed such internal control over financial reporting, or caused such internal control over financialreporting to be designed under our supervision, to provide reasonable assurance regarding the reliability offinancial reporting and the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles; c.evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in thisreport our conclusions about the effectiveness of the disclosure controls and procedures, as of the end ofthe period covered by this report based on such evaluation; and d.disclosed in this report any change in the registrant's internal control over financial reporting that occurredduring the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annualreport) that has materially affected, or is reasonably likely to materially affect, the registrant's internalcontrol over financial reporting; and 5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internalcontrol over financial reporting, to the registrant's auditors and the audit committee of the registrant's board ofdirectors (or persons performing equivalent functions): a.all significant deficiencies and material weaknesses in the design or operation of internal control overfinancial reporting which are reasonably likely to adversely affect the registrant's ability to record, process,summarize and report financial information; and b.any fraud, whether or not material, that involves management or other employees who have a significantrole in the registrant's internal control over financial reporting. Date: August 17, 2018 /s/ THOMAS LIGUORI Thomas Liguori Chief Financial Officer Exhibit 32.1 Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350(as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002) In connection with the Annual Report on Form 10-K for the year ended June 30, 2018 (the “Report”), I, William J. Amelio,Chief Executive Officer of Avnet, Inc. (the “Company”) hereby certify that: 1.The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the SecuritiesExchange Act of 1934; and 2.The information contained in the Report fairly presents, in all material respects, the financial condition andresults of operations of the Company. Date: August 17, 2018/s/ WILLIAM J. AMELIOWilliam J. AmelioChief Executive Officer Exhibit 32.2 Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350(as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002) In connection with the Annual Report on Form 10-K for the year ended June 30, 2018 (the “Report”), I, Thomas Liguori,Chief Financial Officer of Avnet, Inc. (the “Company”) hereby certify that: 1.The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the SecuritiesExchange Act of 1934; and 2.The information contained in the Report fairly presents, in all material respects, the financial condition andresults of operations of the Company. Date: August 17, 2018 /s/ THOMAS LIGUORI Thomas Liguori Chief Financial Officer
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