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AVNET INC
FORM 10-K
(Annual Report)
Filed 08/08/14 for the Period Ending 06/28/14
Address 2211 SOUTH 47TH STREET
PHOENIX, AZ 85034
Telephone 4806432000
CIK 0000008858
Symbol AVT
SIC Code
5065 - Electronic Parts and Equipment, Not Elsewhere Classified
Industry Electronic Instr. & Controls
Sector Technology
Fiscal Year 06/28
http://www.edgar-online.com
© Copyright 2014, EDGAR Online, Inc. All Rights Reserved.
Distribution and use of this document restricted under EDGAR Online, Inc. Terms of Use.

Table of contents

  • Page 1
    ... (Annual Report) Filed 08/08/14 for the Period Ending 06/28/14 Address Telephone CIK Symbol SIC Code Industry Sector Fiscal Year 2211 SOUTH 47TH STREET PHOENIX, AZ 85034 4806432000 0000008858 AVT 5065 - Electronic Parts and Equipment, Not Elsewhere Classified Electronic Instr. & Controls Technology...

  • Page 2
    ...in its charter) New York 11-1890605 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 2211 South 47th Street, 85034 Phoenix, Arizona (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (480) 643-2000...

  • Page 3
    ... 4. Mine Safety Disclosures PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Item 6. Selected Financial Data Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations Item 7A. Quantitative...

  • Page 4

  • Page 5
    ... management and logistics services, system integration and configuration and supply chain services customized to meet specific requirements of customers and suppliers. Organizational Structure Avnet has two primary operating groups - Electronics Marketing ("EM") and Technology Solutions ("TS...

  • Page 6
    ...within China, South Asia, Australia, New Zealand and Taiwan. EM Japan has sales and marketing business units to serve Japanese OEMs in Japan, Southeast Asia and China. All regions within EM provide the design chain services and supply chain services described above. Technology Solutions As a leading...

  • Page 7
    ... its market presence, increase its scale and scope, and increase its product or service offerings. During fiscal 2014 , the Company completed three acquisitions with aggregate annualized sales of approximately $492.0 million . See Item 7. Management's Discussion and Analysis of Financial Condition...

  • Page 8
    ...testing, assembly, supply chain management and materials management. For the year ended June 28, 2014 , service sales constituted less than 10% of the Company's total sales. A competitive advantage is the size of the Company's supplier base. Because of the number of Avnet's suppliers, many customers...

  • Page 9
    ... available on the Company's website ( www.avnet.com under the "Investor Relations - SEC Filings" caption) as soon as reasonably practicable after the report is electronically filed with, or furnished to, the Securities and Exchange Commission. These details about Avnet's website and its content are...

  • Page 10
    ..., its revenues, gross profit margins and prospects may decline. 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. Not...

  • Page 11
    ... to such acquisitions and investments include, but are not limited to, risks relating to expanding into emerging markets and business areas, adding additional product lines and services, incurring costs or liabilities associated with the companies acquired and diverting management's attention from...

  • Page 12
    ... the Company's inventory or unexpected order cancellations by the Company's customers could adversely affect its business, results of operations, financial condition and liquidity. The electronic components and computer products industries are subject to rapid technological change, new and enhanced...

  • Page 13
    ... efforts of management or require it to pay substantial damages or licensing fees. From time to time, the Company receives notifications alleging infringements of intellectual property rights allegedly held by others relating to the Company's business or the products or services it sells. Litigation...

  • Page 14
    ... Leased Location Groveport, Ohio Chandler, Arizona Tongeren, Belgium Poing, Germany Poing, Germany Chandler, Arizona Nettetal, Germany Hong Kong, China Duluth, Georgia Phoenix, Arizona Tempe, Arizona Item 3. Legal Proceedings Primary Use TS warehousing, integration and value-added operations EM...

  • Page 15
    .... Based on the information known to date, management believes that the Company has appropriately accrued in its consolidated financial statements for its share of the estimated costs of environmental matters. The Company is also party to various other lawsuits, claims, investigations and other legal...

  • Page 16
    ... dividends) from June 27, 2009 to June 28, 2014 . The companies comprising the peer group that Avnet has historically used are: Agilysys, Inc., Anixter International, Inc., Arrow Electronics, Inc., Ingram Micro, Inc., Insight Enterprises, Inc., Scansource, Inc., Synnex Corp. and Tech Data Corp. 14

  • Page 17
    ... Company's monthly purchases of Avnet's common stock during the fourth quarter ended June 28, 2014 , under the share repurchase program, which is part of a publicly announced plan, and purchases made on the open market to obtain shares for the Company's Employee Stock Purchase Plan ("ESPP"), which...

  • Page 18
    ...Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs June 28, 2014 Income: Sales Gross profit Operating income (a) Income tax expense (b) Net income (c) Financial Position: Working capital (d) Total assets Long-term debt Shareholders' equity Per Share: Basic earnings Diluted...

  • Page 19
    ... basis, a gain on bargain purchase of $31.3 million before and after tax and $0.22 per share on a diluted basis related to the acquisition of Internix, Inc., and an income tax benefit of $12.2 million primarily related to a favorable settlement of an income tax audit. Second quarter results were...

  • Page 20
    ... (ii) the transfer of a portion of Avnet's reverse logistics operations and a regional computing components operation at the beginning of fiscal 2014 from the Electronics Marketing ("EM") operating group to the Technology Solutions ("TS") operating group. Sales taking into account the combination of...

  • Page 21
    ....3 7,408.9 6,799.3 25,707.5 Percent Change 2014 to 2013 to 2013 2012 June 28, 2014 Sales by Operating Group: $ EM Americas EM EMEA EM Asia Total EM TS Americas TS EMEA TS Asia Total TS Total Avnet, Inc. $ Sales by Geographic Area: $ Americas EMEA Asia/Pacific $ Sales % of Total % of Total 4,844...

  • Page 22
    ... Pinnacle Data Systems Canvas Systems Unidux Electronics Limited (Singapore) Round2 Technologies DE2 SAS JC Tally Trading Co. & Shanghai FR International Trading Prospect Technology Amosdec SAS Total fiscal 2012 TS Americas & TS EMEA TS Americas EM Americas TS Americas TS Americas & TS EMEA EM Asia...

  • Page 23
    ... on fiscal 2014 EM gross profit margin and operating expense margin. TS sales of $10.96 billion for fiscal 2014 increased 5.7% from fiscal 2013 sales of $10.36 billion . Organic sales remained flat year over year in constant dollars. In the Americas region, year-over-year organic sales increased...

  • Page 24
    ... profit margin declined 52 basis points year over year primarily related to declines in gross margins in the EMEA region and a higher mix of sales from the Asia region. The decline in EMEA gross margin was primarily due to the effects of market pressures associated with relatively short product lead...

  • Page 25
    ....3 million related to EM, $23.1 million related to TS and $1.3 million related to corporate business support functions. During the fourth quarter of fiscal 2014, the Company incurred restructuring expenses related to certain actions intended to achieve planned synergies from recent acquisitions and...

  • Page 26
    ... , or 3.8% of sales, in fiscal 2012. EM operating income of $635.6 million was down 16.3% year over year and operating income margin decreased 88 basis points year over year to 4.2% . The decline in EM operating income margin was primarily due to lower gross profit margin as previously mentioned...

  • Page 27
    compared to fiscal 2012. Included in other expense for fiscal 2013 is a realized gain on the sale of marketable securities partially offset by foreign currency losses due to the devaluation of the Venezuelan currency during fiscal 2013. 25

  • Page 28
    ... share on a diluted basis as a result of the divestiture of a small business in the TS Asia region. During fiscal 2012, the Company recognized a gain on bargain purchase related to the acquisition of Unidux of $4.3 million before and after tax and $0.03 per share on a diluted basis. In addition, the...

  • Page 29
    .... During fiscal 2013 , the Company used $262.3 million of cash for acquisitions, net of cash acquired, and $97.4 million for capital expenditures primarily related to information system development costs and computer hardware and software purchases. During fiscal 2012 , the Company used $313...

  • Page 30
    ....0 $ The Company also has several small lines of credit and other forms of bank debt in various foreign locations to fund the short-term working capital, foreign exchange, overdraft and letter of credit needs of its wholly owned subsidiaries in EMEA, Asia, Latin America and Canada. Avnet generally...

  • Page 31
    ... plans to repurchase stock from time to time at the discretion of management, subject to strategic considerations, market conditions and other factors. The Company may terminate or limit the share repurchase program at any time without prior notice. The timing and actual number of shares purchased...

  • Page 32
    ... 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...

  • Page 33
    ... changing, cyclical and competitive markets wherein such inventories may be subject to declines in market value or technological obsolescence. The Company regularly evaluates inventories for excess, obsolescence or other factors that may render inventories less marketable. Writedowns are recorded...

  • Page 34
    ... market conditions or should the structure of the Company's reporting units change based upon changes in business strategy, the Company may be required to perform an interim impairment test which may result in a goodwill impairment charge. During fiscal 2014 , 2013 and 2012 , the Company performed...

  • Page 35
    ... Floating rate debt $ 717.4 $ 717.4 $ 485.2 $ 485.2 Average interest rate 1.1% 1.1% _____ (1) Excludes discounts on long-term notes. Fair value was estimated primarily based upon quoted market prices for the Company's long-term notes. Many of the Company's subsidiaries purchase and sell products in...

  • Page 36
    ...forward foreign exchange contracts, which would generally be offset by an opposite effect on the underlying exposure being economically hedged. Item 8. Financial Statements and Supplementary Data The financial statements and supplementary data are listed under Item 15 of this Report. Item 9. Changes...

  • Page 37
    ... States of America. Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Management conducted...

  • Page 38
    ... called for by Item 13 is incorporated in this Report by reference to the Company's definitive proxy statement relating to the Annual Meeting of Shareholders anticipated to be held on November 6, 2014 . Item 14. Principal Accounting Fees and Services The information called for by Item 14 is...

  • Page 39
    ... Statements: Report of Independent Registered Public Accounting Firm Avnet, Inc. and Subsidiaries Consolidated Financial Statements: Consolidated Balance Sheets at June 28, 2014 and June 29, 2013 Consolidated Statements of Operations for the years ended June 28, 2014, June 29, 2013 and June 30, 2012...

  • Page 40
    ... Officer and Director KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby authorizes and appoints each of Richard Hamada and Kevin Moriarty 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...

  • Page 41

  • Page 42
    ... have audited the Company's internal control over financial reporting as of June 28, 2014 , based on the criteria established in Internal Control Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible...

  • Page 43
    AVNET, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS June 28, June 29, 2014 2013 (Thousands, except share amounts) ASSETS Current assets: Cash and cash equivalents Receivables, less allowances of $96,382 and $95,656, respectively Inventories Prepaid and other current assets Total current assets ...

  • Page 44
    ... Cost of sales Gross profit Selling, general and administrative expenses Restructuring, integration and other expenses Operating income Other (expense) income, net Interest expense Gain on legal settlement, bargain purchase and other (Notes 2 and 13) Income before income taxes Income tax expense Net...

  • Page 45
    AVNET, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Years Ended June 29, 2013 (Thousands) $ 450,073 44,597 30,130 524,800 June 28, 2014 Net income Other comprehensive income (loss), net of tax: Foreign currency translation adjustments and other Pension adjustments, net ...

  • Page 46
    ...June 30, 2012 Net income Translation adjustments Pension liability adjustments, net of tax of $19,062 Repurchases of common stock (Note 4) Stock-based compensation, including related tax benefits of $4,110 Acquisition of non-controlling interest (Note 2) Balance, June 29, 2013 Net income Translation...

  • Page 47
    ..., 2014 Cash flows from operating activities: Net income Non-cash and other reconciling items: Depreciation Amortization Deferred income taxes Stock-based compensation Gain on bargain purchase and other (Note 2) Other, net Changes in (net of effects from businesses acquired): Receivables Inventories...

  • Page 48
    ...venture to determine if it is other-thantemporarily impaired. During fiscal 2014, 2013 and 2012 the Company did not have any material investments in ventures. Depreciation , amortization and useful lives - The Company reports property, plant and equipment at cost, less accumulated depreciation. Cost...

  • Page 49
    ... is performed at the reporting unit level, and the Company has identified six reporting units, defined as each of the three regions (Americas, EMEA, and Asia Pacific) within the Company's two reportable segments. The Company will perform an impairment test between scheduled annual tests if facts and...

  • Page 50
    ... upon the sales terms. Most of the Company's product sales come from products Avnet purchases from a supplier and holds in inventory. A portion of the Company's sales are products shipped directly from its suppliers to its customers ("drop-ship"). In such drop-ship arrangements, Avnet negotiates the...

  • Page 51
    ... discussion of the fair value of the Company's long-term debt and Note 10 for a discussion of the fair value of the Company's pension plan assets. Derivative financial instruments - Many of the Company's subsidiaries purchase and sell products in currencies other than their functional currencies...

  • Page 52
    ... Standards Update No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"), to supersede nearly all existing revenue recognition guidance under GAAP. The core principles of ASU 2014-09 are to recognize revenues when promised goods or services are transferred to customers in an amount that...

  • Page 53
    ... long-term liabilities Total identifiable liabilities assumed Net identifiable assets acquired Goodwill Net assets acquired $ $ Goodwill of $52.0 million was assigned to the Electronics Marketing ("EM") reportable segment and goodwill of $10.6 million was assigned to the Technology Solutions ("TS...

  • Page 54
    ... that time. During fiscal 2013, the Company recognized a gain on bargain purchase related to Internix of $32.7 million before and after tax and $0.23 per share on a diluted basis. In addition to the acquisitions described above, during fiscal 2013, the Company acquired the remaining non-controlling...

  • Page 55
    Table of Contents AVNET, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) 2012 Acquisitions During fiscal 2012 , the Company acquired 11 businesses with aggregate annualized sales of approximately $912.0 million for total consideration of $413.6 million , which ...

  • Page 56
    ... to determine the amount of sales and earnings of each business subsequent to their respective acquisition dates as each business has been integrated into the Company. Unidux Electronic Limited, a Singapore publicly traded company, was acquired in January 2012 through a tender offer. After assessing...

  • Page 57
    ... in the open market or through privately negotiated transactions. The timing and actual number of shares repurchased will depend on a variety of factors such as price, corporate and regulatory requirements, and prevailing market conditions. During fiscal 2014 , the Company repurchased 0.2 million...

  • Page 58
    ...fiscal 2009. Electronics Marketing Gross goodwill Accumulated impairment Carrying value at June 29, 2013 Additions Adjustments Foreign currency translation Carrying value at June 28, 2014 Gross goodwill Accumulated impairment Carrying value at June 28, 2014 $ $ Technology Solutions (Thousands) 1,646...

  • Page 59
    ... program (Note 3) Current portion of long-term debt Short-term debt Bank credit facilities consist of various committed and uncommitted lines of credit and other forms of bank debt with financial institutions utilized primarily to support the working capital requirements of foreign operations...

  • Page 60
    ...053) 2,078,902 $ At June 28, 2014 , the carrying value and fair value of the Company's debt was $2.08 billion and $2.19 billion , respectively. Fair value was estimated primarily based upon quoted market prices for the Company's long-term notes. At June 29, 2013, the carrying value and fair value...

  • Page 61
    ...and (ii) a net tax benefit of $7.0 million resulting from losses related to an investment in a foreign subsidiary. The fiscal 2014 effective tax rate is higher than the fiscal 2013 effective tax rate primarily due to a lower amount of tax benefits from audit settlements in fiscal 2014 as compared to...

  • Page 62
    ... industries; and (iii) prudent and feasible tax planning strategies. As of the end of fiscal 2014, the Company had a partial valuation allowance against significant net operating loss carry-forward deferred tax assets related to a legal entity in EMEA due to, among several other factors, a history...

  • Page 63
    ...(federal and state) Belgium Germany, Taiwan and United Kingdom Netherlands, Singapore and Hong Kong 10. Pension and retirement plans Pension Plan The Company's noncontributory defined benefit pension plan (the "Plan") covers substantially all domestic employees. Employees are eligible to participate...

  • Page 64
    Table of Contents AVNET, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) percentage of current salary, which varies with age, and interest credits. The Company uses its fiscal year end as the measurement date for determining pension expense and benefit obligations for...

  • Page 65
    ...measurement date at the end of fiscal 2014 and 2013 : 2014 Equity securities Fixed income debt securities Cash and cash equivalents 75% 24% 1% 2013 75% 24% 1% The general investment objectives of the Plan are to maximize returns through a diversified investment portfolio in order to earn annualized...

  • Page 66
    ...invested in fixed income debt securities. The following table sets forth the fair value of the Plan's investments as of June 28, 2014 : Level 1 Cash and cash equivalents Equities: U.S. common stocks International common stocks Fixed Income: U.S. government agencies U.S. corporate bonds Total $ 3,025...

  • Page 67
    ...-based payments at fair value and recognizes related expense within operating expenses in the consolidated statements of operations over the requisite service period (generally the vesting period). During fiscal 2014 , 2013 , and 2012 , the Company recorded stock-based compensation expense of $45...

  • Page 68
    ..., is spread equally over the vesting period and is generally subject to the employee's continued service and employment by the Company, except for employees who are retirement eligible. As of June 28, 2014 , 2.0 million shares previously awarded have not yet vested. Stock-based compensation expense...

  • Page 69
    ... date. During fiscal 2014 , 2013 and 2012 , compensation expense associated with the outside director stock-based compensation plan was $1.0 million , $1.0 million and $1.1 million , respectively. Employee stock purchase plan The Company has an Employee Stock Purchase Plan ("ESPP") under the terms...

  • Page 70
    ... at this time. LCD Class Action Settlement The Company filed a proof of claim in the settlement of a class action proceeding that sought damages from certain manufacturers of LCD flat panel displays. A settlement was reached in the proceedings and in the first quarter of fiscal 2014 the federal...

  • Page 71
    ... services that help customers evaluate, design-in and procure electronic components throughout the lifecycle of their technology products and systems. By working with EM, customers and suppliers can accelerate their time to market and realize cost efficiencies in both the design and manufacturing...

  • Page 72
    ... Contents AVNET, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) At the beginning of fiscal 2014, a portion of the Company's reverse logistics operations, which was previously included in the EM operating group, was combined within the TS operating group. The Company...

  • Page 73
    ... Solutions Corporate Depreciation & amortization expense: Electronics Marketing Technology Solutions Corporate Sales, by geographic area: Americas (1) EMEA (2) Asia/Pacific (3) Property, plant and equipment, net, by geographic area: Americas (4) EMEA (5) Asia/Pacific _____ (1) (2) $ June 30, 2012...

  • Page 74
    Table of Contents AVNET, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) (3) Includes sales of $2.63 billion , $2.93 billion and $1.19 billion in Taiwan, China (including Hong Kong) and Singapore, respectively, for fiscal 2014 . Includes sales of $2.28 billion , $2.44...

  • Page 75
    ...recorded in fiscal 2014 related to the reduction, or planned reduction, of over 1,100 employees, primarily in operations, sales and business support functions, in connection with cost reduction actions taken in both operating groups, including reductions in recently acquired or integrated businesses...

  • Page 76
    ... in restructuring expenses recorded during fiscal 2013, $68.9 million related to EM, $48.0 million related to TS and $3.1 million related to corporate business support functions. As of June 28, 2014 , management expects the majority of the remaining severance, facility exit and other liabilities to...

  • Page 77
    ... of Contents AVNET, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) As of June 29, 2013, there was $4.7 million of restructuring liabilities remaining related to restructuring actions taken in fiscal years 2012 and prior, the majority of which relates to facility exit...

  • Page 78
    SCHEDULE II AVNET, INC. AND SUBSIDIARIES VALUATION AND QUALIFYING ACCOUNTS Years Ended June 28, 2014 , June 29, 2013 and June 30, 2012 Balance at Beginning of Period Charged to Expense (Income) Charged to Other Accounts (Thousands) $ - 4,021 (c) - 28,300 (e) - (35,894) (f) $ Balance at End of Period...

  • Page 79
    ... required to be filed as exhibits to this Report. The Company agrees to furnish copies of such instruments to the Commission upon request. Executive Compensation Plans and Arrangements 10.1 2011 Amended and Restated Employment Agreement between the Company and Richard Hamada (incorporated herein by...

  • Page 80
    ... the Company Richard Hamada, Gerry Fay, Erin Lewin, Kevin Moriarty and Steve Phillips (incorporated herein by reference to the Company's Current Report on Form 8-K dated February 14, 2011, Exhibit 10.3). Form of Change of Control Agreement between the Company and each of Harley Feldberg, Phillip...

  • Page 81
    ...Effective Generally as of January 1, 2009) (incorporated herein by reference to the Company's Current Report on Form 8-K dated August 13, 2010, Exhibit 10.2). Avnet Supplemental Executive Officers' Retirement Plan (2013 Restatement) (incorporated herein by reference to the Registrant's Form 10-K for...

  • Page 82
    (b) Form of incentive stock option agreement (c) Form of performance stock unit term sheet (d) Form of restricted stock unit term sheet 77

  • Page 83
    Exhibit Number Exhibit (incorporated herein by reference to the Company's Current Report on Form 8-K dated August 10, 2012, Exhibit 10.1). Avnet, Inc. 2013 Stock Compensation and Incentive Plan (incorporated herein by reference to the Registrant's Current Report on Form 8-K dated November 8, 2013, ...

  • Page 84
    78

  • Page 85
    ... dated as of August 22, 2013 to the Second Amended and Restated Receivables Purchase Agreement (incorporated herein by reference to the Company's Current Report on Form 8-K dated August 22, 2013, Exhibit 10.1). 10.29 Credit Agreement dated as of November 18, 2011 among Avnet, Inc., Bank of America...

  • Page 86
    101.LAB 101.PRE 101.DEF * ** ** ** ** XBRL Taxonomy Extension Label Linkbase Document. XBRL Taxonomy Extension Presentation Linkbase Document. XBRL Taxonomy Extension Definition Linkbase Document. Filed herewith. Furnished herewith. 79

  • Page 87
    ... forth in this Term Sheet, the Avnet, Inc. 2013 Stock Compensation and Incentive Plan (the "Plan"), and the Standard Terms and Conditions for Incentive Stock Options (the "Standard Terms and Conditions") attached to this Term Sheet. Name of Participant: Employee Number: Grant Date: Number of Shares...

  • Page 88

  • Page 89
    ... in the Term Sheet, these Standard Terms and Conditions, and the Plan. For purposes of these Standard Terms and Conditions and the Term Sheet, the "Company" refers to Avnet and its Subsidiaries. The Option is intended to be an incentive stock option under Section 422 of the Internal Revenue Code of...

  • Page 90
    ... expire and cease to be exercisable as of the Expiration Date set forth in the Term Sheet. A. If the Participant ceases to be employed by the Company prior to a Change in Control for any reason other than death, disability, or Retirement (as defined below), the Option shall immediately expire and...

  • Page 91
    ... conditions, and limitations as it determines appropriate as to the timing and manner of any resales by the Participant or other subsequent transfers by the Participant of any shares of Stock issued as a result of the exercise of the Option, including (a) restrictions under an insider trading policy...

  • Page 92
    ... Regulation T simultaneous exercise and sale. No provision of the Plan, the Term Sheet, or these Standard Terms and Conditions shall be construed to transfer to the Company or any of its affiliates any responsibility to pay any income, employment, excise, or other taxes attributable to the grant or...

  • Page 93
    ... Plan, the Term Sheet, these Standard Terms and Conditions, or any other instrument executed pursuant to the Plan shall confer upon the Participant any right to continue in the Company's employ or service or limit in any way the Company's right to terminate the Participant's employment at any time...

  • Page 94
    .... The Participant acknowledges that a copy of the Plan, the Plan prospectus, and Avnet's most recent annual report to its shareholders has been delivered to the Participant. The Plan, the Term Sheet, and these Standard Terms and Conditions shall be governed, construed, interpreted, and administered...

  • Page 95
    ... in this Term Sheet, the Avnet, Inc. 2013 Stock Compensation and Incentive Plan (the "Plan"), and the Standard Terms and Conditions for Nonqualified Stock Options (the "Standard Terms and Conditions") attached to this Term Sheet. Name of Participant: Employee Number: Grant Date: Number of Shares...

  • Page 96

  • Page 97
    ... Terms and Conditions, and the Plan. For purposes of these Standard Terms and Conditions and the Term Sheet, the "Company" refers to Avnet and its Subsidiaries. 2. NON-QUALIFIED STOCK OPTION The Option is not intended to be an incentive stock option under Section 422 of the Internal Revenue Code...

  • Page 98
    ...and cease to be exercisable as of the Expiration Date set forth in the Term Sheet. A. If the Participant's employment or service with the Company terminates prior to a Change in Control for any reason other than death, disability, or Retirement (as defined below), the Option shall immediately expire...

  • Page 99

  • Page 100
    ...(a) restrictions under an insider trading policy, (b) restrictions designed to delay and/or coordinate the timing and manner of sales by the Participant and other optionholders, (c) requiring that you acknowledge and accept these Standard Terms and Conditions and the Term Sheet, and (d) restrictions...

  • Page 101
    ... Term Sheet, these Standard Terms and Conditions, or any other instrument executed pursuant to the Plan shall confer upon the Participant any right to continue in the Company's employ or service or limit in any way the Company's right to terminate the Participant's employment or service at any time...

  • Page 102

  • Page 103
    .... The Participant acknowledges that a copy of the Plan, the Plan prospectus, and Avnet's most recent annual report to its shareholders has been delivered to the Participant. The Plan, the Term Sheet, and these Standard Terms and Conditions shall be governed, construed, interpreted, and administered...

  • Page 104
    ..., the Participant acknowledges that he or she has received and read, and agrees that these PSUs shall be subject to, the terms of the Plan, this Term Sheet and the attached Standard Terms and Conditions. AVNET, INC. By: _____ Kevin Moriarty Title: Senior Vice President & Chief Financial Officer

  • Page 105
    ... "PSUs"), subject to the conditions set forth in the Term Sheet, these Standard Terms and Conditions, and the Plan. For purposes of these Standard Terms and Conditions and the Term Sheet, the "Company" refers to Avnet and its subsidiaries. 2. VESTING AND PERFORMANCE The number of PSUs that become...

  • Page 106

  • Page 107
    ...before and including the end day of the applicable period. Performance Goals . The number of PSUs that become vested under this award (subject to satisfying the service conditions) shall equal the sum of (i) the Annual Relative EP portion, plus (ii) the Relative TSR portion, each as described below...

  • Page 108
    ... accordance with the terms of the Plan and these Standard Terms and Conditions. 3. TERMINATION OF EMPLOYMENT OR SERVICE Except as provided below with respect to death, disability, Retirement, or Change in Control, if the Participant ceases to be employed by or in the service of the Company for any...

  • Page 109

  • Page 110
    ... countries are subject to the laws of the appropriate tax jurisdiction. These Standard Terms and Conditions shall be interpreted consistent with the intent to comply with, or be exempt from, the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, such that there are no...

  • Page 111
    ... under an insider trading policy, (b) restrictions designed to delay and/or coordinate the timing and manner of sales by the Participant and other holders of awards granted under the Plan, (c) requiring that you acknowledge and accept these Standard Terms and Conditions and the Term Sheet and...

  • Page 112
    ...annual report to its shareholders has been delivered to the Participant. Nothing in the Plan, the Term Sheet, these Standard Terms and Conditions, or any other instrument executed pursuant to the Plan shall confer upon the Participant any right to continue in the Company's employ or service or limit...

  • Page 113
    • • SYNNEX Corporation Tech Data Corporation Note that the companies that make up this index may be revised prior to vesting of the PSUs depending upon, among other items, mergers, acquisitions and failure to publicly provide financial information.

  • Page 114
    ...the number of shares of its common stock (the "Stock") set forth in the award letter, subject to the conditions set forth in these Standard Terms and Conditions, and the Plan. For purposes of these Standard Terms and Conditions and the award letter, the "Company" refers to Avnet and its subsidiaries...

  • Page 115
    ...the Participant's age plus years of service is no less than 65; and (b) the Participant has signed a non-competition agreement in a form acceptable to the Company. 6. CHANGE IN CONTROL In the event of a Change in Control (as such term is defined in the Plan), the Incentive Stock Units shall become...

  • Page 116

  • Page 117
    ... restrictions under an insider trading policy, (b) restrictions designed to delay and/or coordinate the timing and manner of sales by the Participant and other holders of awards granted under the Plan, requiring that you acknowledge and accept these Standard Terms and Conditions and (c) restrictions...

  • Page 118
    ..., these Standard Terms and Conditions, or any other instrument executed pursuant to the Plan shall confer upon the Participant any right to continue in the Company's employ or service or limit in any way the Company's right to terminate the Participant's employment or service at any time and for any...

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    Exhibit 12.1 Avnet, Inc. Computation of Ratios of Earnings to Fixed Charges June 28, 2014 June 29, 2013 June 30, 2012 (in thousands) Earnings: Income from continuing operations before tax Add fixed charges Total Earnings Fixed charges: Interest on indebtedness including amortization of debt expense...

  • Page 121
    Exhibit 21 Avnet, Inc. Foreign and Domestic Subsidiaries Company Name "Gleichmann & Co" Electronics GmbH Abacus Group Limited Alpha 3 Manufacturing Ltd Ascendant Software Technology (India) Private Limited Ascendant Technology d.o.o. Beograd Ascendant Technology Do Brasil Serviços Em Tecnologia ...

  • Page 122
    ...Avnet Nortec AS Avnet Nortec Oy 2 Brazil Switzerland Austria France Germany Italy United Kingdom Germany Belgium Netherlands Hong Kong France Indiana Turkey Netherlands Belgium Germany South Africa Australia United Kingdom United Kingdom Delaware Spain India Singapore New York Canada Delaware Japan...

  • Page 123
    ...Mexico Philippines Delaware Italy Czech Republic Singapore Malaysia Poland Hong Kong Thailand Taiwan Hong Kong Singapore Australia China India Malaysia Singapore Thailand China Vietnam Denmark Argentina Netherlands Brazil Chile Colombia Ecuador Germany Austria Hungary United Kingdom Romania Slovakia...

  • Page 124
    ...Thailand) Company Limited Avnet Verwaltungs GmbH Beijing Vanda Yunda IT Services Co., Ltd Bell Microproducts Brazil Holdings, LLC Bell Microproducts Mexico Shareholder, LLC BFI-IBEXSA International LLC CAMP Marketing-Service GmbH Canvas Systems B.V. Canvas Systems UK Limited Client Solutions Limited...

  • Page 125
    ... Internix Hong Kong Limited Kent One Corporation M S C - Vertriebs - SK s. r. o. Magirus Aktiengesellschaft Magirus France Magirus Systems Integration Magirus UK Ltd Memec (Asia Pacific) Limited Memec Group Holdings Limited Memec Group Limited Memec Holdings Limited Memec Pty Limited Mexico Holdings...

  • Page 126
    ... Systems Management Limited WBT Systems Limited WBT Systems, Inc. YEL Electronics (China) Limited YEL Electronics (Shanghai) Limited YEL Electronics (Shenzhen) Ltd YEL Electronics Hong Kong Limited YEL Electronics Pte Ltd YEL Electronics Sdn Bhd ZWEITE TENVA Property GmbH Im Technologiepark Belgium...

  • Page 127
    ... three-year period ended June 28, 2014, the related financial statement schedule, and the effectiveness of internal control over financial reporting as of June 28, 2014, which report appears in the June 28, 2014, annual report on Form 10-K of Avnet, Inc. /s/ KPMG LLP Phoenix, Arizona August 8, 2014

  • Page 128
    ... and report financial information; and any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. b. Date: August 8, 2014 /s/ RICHARD HAMADA Richard Hamada Chief Executive Officer

  • Page 129
    ... and report financial information; and any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. b. Date: August 8, 2014 /s/ KEVIN MORIARTY Kevin Moriarty Chief Financial Officer

  • Page 130
    ... 15(d), as applicable, of the Securities Exchange Act of 1934; and The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. 2. Date: August 8, 2014 /s/ RICHARD HAMADA Richard Hamada Chief Executive Officer

  • Page 131
    ...the Sarbanes-Oxley Act of 2002) In connection with the Annual Report on Form 10-K for the year ended June 28, 2014 (the "Report"), I, Kevin Moriarty, 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...