Emulex Board Continues to Recommend Against Broadcom's Offer: Page 2 of 7

Broadcom's Tactics Underscore Emulex's Early Lead in the Converged
Networking Space and Broadcom's Inability to Compete Effectively.

Converged networking is widely recognized as a critical emerging technology for the data center, and Emulex has beaten Broadcom to provide the complete solution required to address this market. In our view, Broadcom is well aware that it does not have the technology to compete due to its lack of Fibre Channel capability -- an integral component to the technological offering. In addition, Broadcom would have you believe that this is merely a build versus buy opportunity.
Even if Broadcom could develop a Fibre Channel stack, we do not believe Broadcom could compete effectively through a build strategy as it would take a minimum of three years for a company to build and qualify its first generation products, while in the same time frame we expect the Original Equipment Manufacturer (OEM) customers that we have already won will be shipping our third generation solutions which are already in development. Thus, we believe Broadcom would be too late to the market to compete effectively against an established incumbent. We believe Broadcom's hostile attempt to acquire Emulex underscores the significant impact our successes are having on the current and future prospects of Broadcom's core Ethernet business.

"In the future, it is the emerging Fibre Channel over Ethernet (FCoE) that will carry the storage traffic" "...it is a lot easier for Emulex or QLogic or Brocade to build FCoE products, than for Broadcom, Marvell or Juniper to build FCoE products..." "In other words, Ethernet vendors should be desperately seeking a credible and established FC provider."
(Wedbush Morgan, April 28, 2009)

"Recent checks confirm Emulex claims of Broadcom design win losses"
"After the close Friday, industry sources disclosed to us indications that Broadcom is losing 10GbE design wins to Emulex... for CNA design wins slated for 2H10 ramp." (JMP Securities, May 4, 2009)

With its unique converged networking offerings, Emulex is rapidly becoming a leader in this market. As a result of our early leadership in this emerging market, the Company expects to double its addressable market to nearly $1.5 billion by calendar 2013. Over the past several months alone, Emulex has achieved 12 new design wins with tier-one OEMs, which prior to the Broadcom proposal were unannounced and non-public. We anticipate these 12 design wins will support the vast majority of our projected $150 million in converged networking revenues in fiscal year 2012, increasing Emulex's total revenue to $600 million in the same time period. Broadcom was uniquely aware of these multi-million dollar wins at the time it launched its unsolicited and grossly inadequate tender offer as we competed directly against Broadcom for almost half of them, and won -- wins that we believe are now threatening Broadcom's long dominant Ethernet networking market position.