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UNITED STATES


SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.          )

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.     )
Filed by the Registrantýx

Filed by a Party other than the Registranto

Check the appropriate box:

o
 
Preliminary Proxy Statement

o
 
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

ý
 
Definitive Proxy Statement

o
 
Definitive Additional Materials

o
 
Soliciting Material underPursuant to §240.14a-12


Vitesse Semiconductor CorporationVITESSE SEMICONDUCTOR CORPORATION
(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

ý
 
No fee required.

o
 
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
  (1)(1) Title of each class of securities to which transaction applies:
  (2)(2) Aggregate number of securities to which transaction applies:
  (3)(3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
  (4)(4) Proposed maximum aggregate value of transaction:
  (5)(5) Total fee paid:

o
 
Fee paid previously with preliminary materials.

o
 
Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.



(1)

Amount Previously Paid:
  (2)(1)Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
  (3)(3) Filing Party:
  (4)(4) Date Filed:


LOGO




741 Calle Plano Drive
Camarillo, California 93012
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
May 11, 2010
To Be Held Thursday,

TO OUR STOCKHOLDERS:

        NOTICE IS HEREBY GIVEN that theMarch 7, 2013

To Our Stockholders:
The 2013 Annual Meeting of Stockholders of VITESSE SEMICONDUCTOR CORPORATION, a Delaware corporation,Vitesse Semiconductor Corporation will be held on May 11, 2010March 7, 2013, at 99:00 a.m. local time, at the Hyatt Westlake Plaza in Thousand Oaks, 880 S. Westlake Blvd.,Boulevard, Westlake Village, California 91361, for the following purposes:

    1.
    To elect five directors to serve for the ensuing year and until their successors are duly elected (Proposal One);

    2.
    To approve the 2010 Vitesse Semiconductor Corporation Incentive Plan (Proposal Two);

    3.
    To ratify the appointment of BDO Seidman, LLP as the Company's independent registered public accounting firm for the fiscal year ending September 30, 2010 (Proposal Three); and

    4.
    To transact such other business as may properly be brought before the meeting and any adjournment(s) thereof.

1.To elect seven directors to hold office for the ensuing year and until their successors are duly elected;
2.To approve the Vitesse Semiconductor Corporation 2013 Incentive Plan;
3.To hold an advisory vote on executive compensation;
4.To ratify the selection of BDO USA, LLP as our independent registered public accounting firm for the fiscal year ending September 30, 2013; and
5.To transact such other business as may properly be brought before the meeting and any adjournment(s) thereof.
The foregoing items of business are more fully described in the Proxy Statementproxy statement accompanying this Notice.

Stockholders of record at the close of business on March 26, 2010January 11, 2013 are entitled to notice of, and to vote at, the meeting.

Annual Meeting.

All stockholders are cordially invited to attend the meeting. However,This year, we are using the Internet as our primary means of furnishing proxy materials to assureour stockholders. Accordingly, most stockholders will not receive paper copies of our proxy materials. We will instead send our stockholders a notice with instructions for accessing the proxy materials and voting electronically over the Internet or by telephone. The notice also provides information on how stockholders may request paper copies of our proxy materials. You may access the proxy statement and our annual report on the Internet, both of which are available at “www.edocumentview.com/VTSS.”
Your vote is important. Whether or not you plan to attend the Annual Meeting, it is important that your shares be represented and voted at the meeting and we urge you to vote as soon as possible. As an alternative to voting in person at the Annual Meeting, you may vote electronically over the Internet or by telephone, or if you receive a proxy card or voting instruction form in the mail, by mailing the completed proxy card or voting instruction form. Timely voting by any of these methods will ensure your representation at the meeting, you are urged to mark, sign, date and return the enclosed proxy card as promptly as possible in the postage-prepaid envelope enclosed for that purpose. Any stockholder of record attending the meeting may vote in person even if he or she has returned a proxy. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote at the meeting, you must obtain a proxy issued in your name from that record holder.

Annual Meeting.

 Sincerely,By Order of the Board of Directors,

 
Camarillo, California
GRAPHIC

Christopher R. Gardner
January 15, 2013President and Chief Executive Officer

Camarillo, California
March 31, 2010



IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS

FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 11, 2010

        The proxy statement and annual report to stockholders are available atwww.vitesse.com/2010-annual-proxy.


YOUR VOTE IS IMPORTANT

In order to assure your representation at the meeting, you are requested to complete, sign and date the enclosed proxy card as promptly as possible and return it in the enclosed envelope. Any stockholder attending the Annual Meeting may vote in person even if he or she returned a proxy card.

VITESSE SEMICONDUCTOR CORPORATION
741 Calle Plano Drive
Camarillo, California 93012


(805) 388-3700
PROXY STATEMENT



INFORMATION CONCERNING SOLICITATION AND VOTING

General
General

The enclosed Proxyproxy is solicited on behalf of the Board of Directors (the "Board"“Board”) of Vitesse Semiconductor Corporation ("Vitesse"(“Vitesse” or the "Company"“Company”, “us”, “we”, or “our”) for use at the 2013 Annual Meeting of Stockholders (the "Annual Meeting"“Annual Meeting”) to be held atthe Hyatt Westlake Plaza in Thousand Oaks, 880 S. Westlake Blvd.,Boulevard, Westlake Village, California 91361, on May 11, 2010Thursday, March 7, 2013, at 9:00 a.m., local time and at any adjournment(s) thereof, for the purposes set forth herein and in the accompanying Notice of Annual Meeting of Stockholders. Our telephone numberThis Proxy Statement is (805) 388-3700. These proxy solicitation materials were first mailed on or about April 1, 2010being made available to all stockholders entitled to vote at the Annual Meeting.

Meeting on or about January 24, 2013.

Record Date and Share Ownership

Shares Outstanding

Stockholders of record at the close of business on March 26, 2010January 11, 2013 (the "Record Date"“Record Date”) are entitled to notice of and to vote at the meetingAnnual Meeting and at any adjournment(s) thereof. On the Record Date, 404,841,80236,869,855 shares of our common stock, $0.01 par value, were issued and outstanding.

Revocability of Proxies

Any proxy given pursuant to this solicitation may be revoked by the person giving it at any time before its use (i) by delivering to us at our principal offices (Attention: Tracy Kern, Corporate Controller)Secretary) a written notice of revocation or a duly executed proxy bearing a later date, or (ii) by attending the meetingAnnual Meeting and voting in person. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote in person at the meeting,Annual Meeting, you must obtain a proxy issued in your name from that record holder, and you will need to provide a copy of such proxy at the meeting.

Annual Meeting.


Attendance at the Annual Meeting

All stockholders of record as of the Record Date may attend the Annual Meeting. Please note that cameras, recording devices and other electronic devices will not be permitted at the Annual Meeting. No items will be allowed into the Annual Meeting that might pose a concern for the safety of those attending. Additionally, to attend the meeting you will need to bring identification and proof sufficient to us that you were a stockholder of record as of the Record Date or that you are a representative of a stockholder of record as of the Record Date for a stockholder of record that is not a natural person.
For directions to attend the Annual Meeting, please visit the Hyatt Westlake Plaza'sPlaza in Thousand Oaks, 880 S. Westlake Boulevard, Westlake Village, California 91361 website athttp://westlake.hyatt.com/ www.westlake.hyatt.com/hyatt/hotels/services/maps/index.jspmaps or contact the hotel via telephone at (805) 557-1234.

Voting and Costs of Solicitation

        On all matters, other than the election

Shares Directly Held-Stockholder of directors, each share has one vote.

Record. If you are a stockholder of record as of“registered holder,” that is your shares are registered in your name through our transfer agent, and you are viewing this proxy over the Record Date,Internet you may vote electronically over the Internet. For those stockholders who receive a paper proxy in person at the Annual Meetingmail, you may also vote electronically over the Internet or by telephone or by completing and mailing the proxy card provided. The website identified in our Notice of Internet Availability of Proxy Materials provides specific instructions on how to vote electronically over the Internet. Those stockholders who receive a paper proxy by proxy using the enclosed proxy card.Whether or not you plan to attend the Annual Meeting, we urge youmail, and who elect to vote by mail, should complete and return the mailed proxy to ensure your vote is counted. As stated above, youcard in the prepaid and addressed envelope that was enclosed with the proxy materials. You may still attendrequest a ballot at the Annual Meeting and vote in person if you have already voted by proxy.


    •
    To vote in person: Come to the Annual Meeting and we will give you a ballot at the time of voting. If you have previously turned in a proxy card, please notify us at the Annual Meeting that you intend to cancel the proxy and vote by ballot.

    •
    To vote using the proxy card: Simply complete, sign and date the enclosed proxy card and return it promptly in the envelope provided. If you return your signed proxy card to us before the Annual Meeting, the designated proxies will vote your shares as you direct. If you are a stockholder of record, you willnot be able to cast your vote over the Internet or by telephone. If you hold your shares in "street name," the broker, nominee, fiduciary or other custodian through which you hold your shares will instruct you as to how your shares may be voted by proxy.person.

        If you return a signed and dated proxy card without marking any voting directions, your shares will be voted:

    •



"For" the election of all five (5) nominees for director set forth herein as described in Proposal One;Shares Indirectly Held-Beneficial Owner

•
"For" the approval of the 2010 Vitesse Semiconductor Corporation Incentive Plan (the "2010 Incentive Plan") as described in Proposal Two;

•
"For" the ratification of the appointment of BDO Seidman, LLP as our independent registered public accounting firm for the fiscal year ending September 30, 2010 as described in Proposal Three;

        If any other matter is properly presented at the Annual Meeting, your proxy holders (one of the individuals named on your proxy card) will vote your shares in their discretion.

. If your shares are held in "street name," meaning that they are registered in the name of a broker, nominee, fiduciarystock brokerage account or by a bank or other custodian, then generally only thatnominee, you are considered the beneficial owner of shares held in “street name,” and these proxy materials are being forwarded to you by your broker or nominee fiduciary or other custodian may execute a proxy andwho is considered the stockholder of record with respect to those shares. We urge you to direct your broker on how to vote your shares. Beneficial owners may attend the Annual Meeting, but may not vote in person unless you obtain a signed proxy from the stockholder of record giving you the right to vote the shares in person at the Annual Meeting. Your broker nominee, fiduciary or other custodiannominee should provide you with a voting instruction formcard for youryou to use to provide them with instructions as toin directing the broker or nominee regarding how to vote your shares. If you did not receive a voting instruction card, please contact the institution holding your shares. We recommend that you vote your shares atin advance as described above, so that your vote will be counted if you later decide not to attend the Annual Meeting. If your shares are held of record

Only proxy cards and voting instruction forms that have been signed, dated and timely returned, and only proxies that have been timely voted electronically or by telephone will be counted in "street name"the quorum and voted. The Internet and telephone voting facilities will close at 11:59 p.m. Eastern Time, Wednesday, March 6, 2013. Stockholders who vote over the Internet or by telephone need not return a broker, nominee, fiduciary or other custodian and you wish to vote in person at the Annual Meeting, you must obtain from the record holder a "legal proxy" issued in your name.

        Stockholders that receive more than one proxy card or voting instruction form have shares registered in different forms or in more than one account. Stockholders that receive more than oneby mail.

We will bear the entire cost of the solicitation of proxies for the Annual Meeting, including the preparation, assembly, printing and mailing of the Notice of Internet Availability of Proxy Materials, this proxy statement, the proxy card, are requestedand any additional solicitation materials furnished to please sign, date and return all proxy cards and provide instructions for all voting instruction forms received to ensure that all of your shares are voted.

        The cost of this solicitation will be borne by us. Georgeson Inc. will distribute proxy materials to beneficial owners, may solicit proxies by personal interview, mail, telephone, and electronic communications, and will request brokerage houses and other custodians, nominees, and fiduciaries to forward soliciting material to the beneficial owners of the common stock held on the record date by such persons. The Company will pay Georgeson Inc. $7,500 for its proxy solicitation services and will reimburse Georgeson Inc. for payments made to brokers and other nominees for their expenses in forwarding solicitation materials.stockholders. Solicitations also may be made by personal interview, telephone and electronic communications by directors, officers and other employees of the CompanyVitesse without additional compensation. We may reimburse brokerage firms and other persons representing beneficial owners of shares for their expenses in forwarding solicitation material to such beneficial owners.

Quorum; Abstentions; No additional compensation will be paid to those individuals for any such services.

If your proxy is properly submitted, the shares represented thereby will be voted at the Annual Meeting in accordance with your instructions. If you are a registered holder and you do not specify how the shares represented thereby are to be voted, your shares will be voted as follows:
“For” election of all seven nominees for director as described in Proposal One;
“For” approval of the Vitesse Semiconductor Corporation 2013 Incentive Plan as described in Proposal Two;
“For” approval of the advisory vote on executive compensation as described in Proposal Three; and
“For” ratification of the appointment of BDO USA, LLP as our independent registered public accounting firm as described in Proposal Four.
If any other matters are properly presented for consideration at the Annual Meeting, including, among other things, consideration of a motion to adjourn the meeting to another time or place in order to solicit additional proxies in favor of the nominees of our Board of Directors, the persons named as proxies and acting thereunder will have discretion to vote on these matters according to their best judgment to the same extent as the person delivering the proxy would be entitled to vote. At the date this proxy statement went to press, we did not know of any other matter to be raised at the Annual Meeting.
Some stockholders receive more than one Notice of Internet Availability of Proxy Materials, proxy card or voting instruction form because their shares are held in multiple accounts or registered in different names or addresses. Please vote your shares held in each account to ensure that all of your shares will be voted.
Quorum, Abstentions, Broker Non-Votes;Non-Votes, Required Votes

Our Bylawsbylaws provide that stockholders holding a majority of the shares of common stockCommon Stock issued and outstanding and entitled to vote on the Record Date constitute a quorum at meetings of stockholders. Therefore, at the Annual Meeting, the presence, in person or by proxy, of the holders of at least 202,420,90218,434,929 shares of Common Stock will be required to establish a quorum. Each outstanding share of



our Common Stock is entitled to one vote on each proposal at the Annual Meeting. Both abstentions and broker non-votes are counted as present for the purpose of determining the presence of a quorum. Broker non-votes, however, are not counted as shares present and entitled to be voted with respect to the matter on which the broker has expressly not voted. Thus, broker non-votes will not affect the outcome of any of the matters being voted on at the Annual Meeting. Generally, broker non-votes occur when shares held by a broker for a beneficial owner are not voted with respect to a particular proposal because (1) the broker has not received voting instructions from the beneficial owner and (2) the broker lacks discretionary voting power to vote such shares because the matter is not considered a routine matter. The only routine matter that is being submitted to stockholders at the Annual Meeting is Proposal Four, ratification of the appointment of our independent registered public accounting firm.




In the election of the seven directors (Proposal One), you may vote “For” all of the nominees or your vote may be “Withheld” with respect to one or more of the nominees. For all other proposals, you may vote “For,” “Against” or “Abstain.” If you “Abstain,” it has the same effect as a vote “Against.”
If a quorum is present at the Annual Meeting, a plurality of the shares voting will be sufficient to elect the director nominees (Proposal One). This means that the seven nominees for election as directors who receive the most votes “for” election will be elected. Approval of the proposals requires the following votes: The five director nominees receiving the highest number of "For" votes will be elected as directorsVitesse Semiconductor Corporation 2013 Incentive Plan (Proposal Two), approval of the Companyadvisory vote on executive compensation (Proposal Three) and ratification of the appointment of our independent registered public accounting firm (Proposal Four), each of Proposals 2 and 3 requires thewill require an affirmative vote of athe majority of the shares of Common Stock present or represented at the Annual Meeting. Votes will be countedMeeting with respect to such proposal. If by the inspectordate of election appointed for the Annual Meeting who will separately count "For" and (with respectwe do not receive proxies representing sufficient shares to proposalsconstitute a quorum, the Chairman of the Meeting, or the stockholders entitled to vote thereat, shall have power to adjourn the meeting, without notice other than announcement at the election of directors) "Against" votes, abstentions and broker non-votes. Because directors are elected by a plurality vote, abstentions in the election of directors will have no impact oncemeeting, until a quorum exists. Abstentions willis present or represented. At such adjourned meeting at which a quorum is present, any business may be counted towardstransacted that might have been transacted at the vote total for each proposal, other than the election of directors, will have the same effectmeeting as "Against" votes with respect to the proposals to approve the 2010 Vitesse Semiconductor Corporation Incentive Plan and to ratify the appointment of BDO Seidman, LLP as our independent registered public accounting firm for the fiscal year ending September 30, 2010. A "broker non-vote" occurs when a nominee holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power with respect to that proposal and has not received instructions with respect to that proposal from the beneficial owner. Broker non-votes represented by submitted proxies will not be taken into account in determining the outcome of the election of directors or the proposals to approve the 2010 Vitesse Semiconductor Corporation Incentive Plan and to ratify the appointment of BDO Seidman, LLP as our independent registered public accounting firm for the fiscal year ending September 30, 2010.

        If you hold shares in your name, and you sign and return a proxy card without giving specific voting instructions, your shares will be voted as recommended by our Board on all matters and as the proxy holders may determine in their discretion with respect to any other matters that properly come before the meeting.

originally noticed.

Effect of Not Casting Your Vote

If you hold your shares in street name it is critical that you cast your vote if you want it to count in the election of directors (Proposal One of this proxy statement)One). In the past, if you held your shares in street name, and you did not indicate how you wanted your shares voted in the election of directors, your bank or broker was allowed to vote those shares on your behalf in the election of directors as they feltit deemed appropriate.

        Recent changes in regulations were made to take away the ability of your

Your bank or broker no longer has the discretion to vote your uninstructed shares in the election of directorsdirectors. Similarly, your bank or broker does not have ability to vote your uninstructed shares on any other matters being submitted to the stockholders for a discretionary basis.vote at the Annual Meeting other than ratification of the appointment of our independent registered public accounting firm (Proposal Four). Thus, if you hold your shares in street name and you do not instruct your bank or broker how to vote inat the election of directors, no voteAnnual Meeting, your shares will not be castvoted on your behalf. Your bankProposals One, Two or broker does not have discretion to vote any uninstructed shares in favor of the approval of the 2010 Incentive Plan (Proposal Two of this proxy statement), however your bank or broker will continue to have discretion to vote any uninstructed shares on the ratification of the appointment of the Company's independent registered public accounting firm (Proposal Three of this proxy statement).

Three.

Deadline for Receipt of Stockholder Proposals

        Proposals of stockholders that are intended

In order for a stockholder proposal to be presented by such stockholders atconsidered for inclusion in our proxy statement for our 2014 Annual Meeting of Stockholders, the annual meeting of stockholders for the 2010 fiscal yearwritten proposal must be received by us no later than September 26, 2013, and should contain the close of business on the 45th day, nor earlier than the close of business on the 75th day, prior to the one year anniversary of the date these proxy materials were first mailed by us unless the annual meeting of stockholders is held prior to April 11, 2011 or after July 10, 2011, in which case, the proposal must be received by us not earlier than the 120th day prior to the annual meeting and not later than the later of the 90th day prior to the annual meeting and the tenth day following public announcement of the date the annual meeting will be held and must otherwise be in compliance with applicable laws and regulations in order to be considered for inclusion in the proxy statement and form of proxy relating to that meeting. Under the federal securities laws, for such a matter to be included in the proxy materials



for the annual meeting of stockholders for the 2010 fiscal year, timely notice must be delivered to us atinformation required under our principal executive offices to the attention of Tracy Kern, our Corporate Controller, not less than 120 days beforebylaws. If the date of next year's annual meeting is moved more than 30 days before or after March 7, 2014, the first anniversary date of this year's Annual Meeting, the deadline for inclusion of proposals in our proxy statement releasedis instead a reasonable time before we begin to stockholders in connection with the previousprint and mail our proxy materials for next year's annual meeting, or December 2, 2010. Stockholdermeeting. Any proposals must otherwisewill also need to comply with the requirements of Rule 14a-8 of the rules and regulations promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"“Exchange Act”). , regarding the inclusion of stockholder proposals in company sponsored proxy materials. Proposals should be addressed to our Corporate Secretary, at our principal executive offices.

If a stockholder who has notified us of his or her intentionyou intend to present a proposal at an annualour 2014 Annual Meeting of Stockholders and the proposal is not intended to be included in our proxy statement relating to that meeting, you must give us advance notice of the proposal in accordance with our bylaws. Pursuant to our bylaws, in order for a stockholder proposal to be deemed properly presented in these circumstances, a stockholder must deliver notice of the proposal to our Corporate Secretary, at our principal executive offices after the close of business on December 7, 2013 and before the close of business on January 6, 2014. However, if the date of our 2014 Annual Meeting of Stockholders is more than 30 days before or after March 7, 2014, the first anniversary of this year's Annual Meeting, stockholders must give us notice of any stockholder proposals within a reasonable time before the mailing date of the proxy statement for next year's Annual Meeting. If a stockholder does not appearprovide us with notice of a stockholder proposal in accordance with the deadlines described above, the stockholder will not be permitted to present his or her proposal at such meeting, we need not present the proposal to the stockholders for a vote at suchthe meeting.

        However,

The proxies to be solicited by us through our Board of Directors for our 2014 Annual Meeting of Stockholders will confer discretionary authority on the proxy holders to vote on any stockholder proposal properly presented at the 2014 Annual Meeting of Stockholders if we fail to receive notice of the stockholder's proposal for the meeting by September 26, 2013.
If a stockholder wishesdesires only to recommend a candidate for consideration by the GovernanceNominating and NominatingCorporate Governance Committee as a potential nominee for the Company'sour Board, see the procedures discussed in "Proposal One—Election“Proposal One-Election of Directors—ProcessDirectors-Process for Recommending Candidates for Election to theour Board of Directors."

        The attached proxy card grants to the proxyholders discretionary authority to vote on any matter raised at the Annual Meeting.

Delivery of Voting Materials to Stockholders Sharing an Address

        To reduce the expense of delivering duplicate voting materials to our stockholders who may hold shares of Vitesse common stock in more than one stock account, we are delivering only one set of the proxy solicitation materials to certain stockholders who share an address, unless otherwise requested. A separate proxy card is included in the voting materials for each of these stockholders. We will promptly deliver, upon written or oral request, a separate copy of the annual report or this proxy statement to a stockholder at a shared address to which a single copy of the documents was delivered. To obtain an additional copy, you may write us at 741 Calle Plano Drive, Camarillo, California 93012, Attn: Investor Relations, or contact us by telephone at (805) 388-3700 and request to be connected to our Investor Relations department. Similarly, if you share an address with another stockholder and have received multiple copies of our proxy materials, you may contact us at the address or telephone number specified above to request that only a single copy of these materials be delivered to your address in the future. Stockholders sharing a single address may revoke their consent to receive a single copy of our proxy materials in the future at any time by contacting our distribution agent, Broadridge, either by calling toll-free at 1-800-542-1061, or by writing to Broadridge, Householding Department, 51 Mercedes Way, Edgewood, NY 11717. Broadridge will remove such stockholder from the householding program within 30 days of receipt of such written notice, after which each such stockholder will receive an individual copy of our proxy materials.

”





Further Information

We will provide without charge to each stockholder solicited by these proxy solicitation materials a copy of Vitesse's annual report on Form 10-K for the fiscal year ended September 30, 20092012, without exhibits, and any amendments, thereto on Form 10-K/A upon request of such stockholder made in writing to Vitesse Semiconductor Corporation, 741 Calle Plano Drive, Camarillo, California 93012, Attn: Investor Relations. We will also furnish any exhibit to the annual report on Form 10-K, if specifically requested in writing. You can also access our Securities and Exchange Commission ("SEC"(“SEC”) filings, including our annual reports on Form 10-K, and all amendments thereto filed on Form 10 K/A, on the SEC website at www.sec.gov.


IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 11, 2010

The proxy statement and annual report to stockholders are available at www.vitesse.com/2010-annual-proxy.




PROPOSAL ONE

ELECTION OF DIRECTORS

Nominees

        Five (5)

Our bylaws provide that the authorized number of directors is a minimum of five and a maximum of nine, with the exact number set by our Board. Currently, the authorized number of directors of the Company is seven, and seven members of our Board are to be elected at the Annual Meeting. Unless otherwise instructed, the proxy holders will vote the proxies received by them for the nominees named below. Each nominee has consented to be named a nominee in thethis proxy statement and to continue to serve as a director if elected. If any nominee becomes unable or declines to serve as a director, if additional persons are nominated at the meeting, or if stockholders are entitled to cumulate votes, the proxy holders intend to vote all proxies received by them in such a manner (in accordance with cumulative voting) as will ensure the election of as many of the nominees listed below as possible, and the specific nominees to be voted for will be determined by the proxy holders.

We are not aware of any reason that any nominee will be unable or will decline to serve as a director. The term of office of each person elected as a director will continue until the next Annual Meeting of Stockholders, or until a successor has been elected and qualified, or until his or her earlier resignation or removal. There are no family relationships among any of our directors or executive officers. Except as described below under “Proposal One-Election of Directors-Board Election Arrangement,” there are no arrangements or understandings between any director or executive officer and any other person pursuant to which he or she is or was to be selected as a director or officer.

Existing Board members G. William LaRosa, who has served as a director since August 2010, and G. Grant Lyon, who has served as a director since October 2009, will not stand for re-election at the Annual Meeting.
The names of the nominees all of whom are currently directors standing for re-election, and certain information about them as of March 26, 2010January 11, 2013, are set forth below. All of the nominees have been recommended for nominationnominated by a majority of theour Board acting on the recommendation of the GovernanceNominating and NominatingCorporate Governance Committee of theour Board, which was approved by a majority vote of the members of such committee. The committee consists solely of independent members of theour Board. There are no family relationships among directors or executive officers of Vitesse.

Name
 Age Director
Since		 Principal Occupation

Christopher R. Gardner

  49  2006 President and Chief Executive Officer

Steven P. Hanson(1)(2)

  61  2007 Senior Partner at Southwest Value Acquisitions LLC

James H. Hugar(1)(2)

  63  2009 Retired Partner at Deloitte & Touche, LLP

G. Grant Lyon(3)

  46  2009 President of Odyssey Capital Group, LLC

Edward Rogas, Jr.(1)(3)

  69  2006 Chairman of the Board of Vitesse, Retired Senior Vice President at Teradyne, Inc.
(1)
Member of the Audit Committee.

(2)
Member of the NominatingExisting Board members G. William LaRosa, who has served as a director since August 2010, and Corporate Governance Committee.

(3)
Member of the Compensation Committee.

        ExceptG. Grant Lyon, who has served as set forth below, each of our directors has been engaged in his principal occupation set forth above during the past five years.

Christopher R. Gardner, age 49, has been a director since October 26, 2006.2009, will not stand for re-election at the Annual Meeting.

The Board recommends that stockholders vote “For” the election of each of the following nominees.
Nominee Age Director
Since		 Principal Occupation
Mathew Frey 43 -- Chief Executive Officer of Optimum Energy, LLC
Christopher R. Gardner 52 2006 President and Chief Executive Officer of Vitesse
Steven P. Hanson(1)(2)(4) 64 2007 Retired President and CEO of ON Semiconductor
James H. Hugar (1)(2)(4) 66 2009 Retired Partner of Deloitte & Touche, LLP
Scot B. Jarvis (1)(4) 52 2012 Co-founder of Cedar Grove Partners, LLC
Edward Rogas, Jr. (1)(3)(4) 72 2006 Chairman of the Board of Vitesse, Retired Senior Vice President of Teradyne, Inc.
Kenneth H. Traub 51 -- President and CEO of Ethos Management, LLC
(1)Member of the Audit Committee
(2)Member of the Nominating and Corporate Governance Committee
(3)Member of the Compensation Committee
(4)Member of the Strategic Advisory Committee
Vote Required
If a quorum is present, the seven nominees receiving the highest number of votes will be elected to our Board. See “Information Concerning Solicitation and Voting-Quorum, Abstentions, Broker Non-Votes, Required Votes.”




Nominees' Principal Occupation, Business Experience and Qualifications
Matthew Frey is the Chief Executive Officer of Optimum Energy, LLC, a cloud based SaaS provider of energy management applications for complex buildings, data centers, campuses, hospitals and manufacturing facilities, a position he has held since November 2010. For more than 16 years, Mr. GardnerFrey has beenserved in senior executive and advisory roles at technology companies, including Data Base, Inc., Payroll Online, World Wide Packets and Optimum Energy. Prior to his current position at Optimum Energy, from January 2004 until its sale to Ciena Corporation in March of 2008, Mr. Frey served as President and Chief Operating Officer of World Wide Packets, a leading provider of Carrier Ethernet solutions. Subsequent to the sale, Mr. Frey served as Ciena's Sr. Vice President of Business Development until January 2009. Mr. Frey brings operational, strategic, industry, and software development expertise to the Board. Mr. Frey holds a BS degree in accounting from Santa Clara University and worked as an auditor at Price Waterhouse in Silicon Valley early in his career.
Christopher R. Gardner has served as a director and our Chief Executive Officer since 2006. He served as Vice President and Chief Operating Officer from 2000 to 2002. From 2002 until he was appointed Chief Executive Officer in 2006, he served as our Vice President and General Manager of the Network Products Division.Division, and from 2000 to 2002, he served as our Vice President and Chief Operating Officer. Prior to joining Vitesse in 1986, Mr. Gardner served as a member of the Technical Staff at Bell Laboratories from 1982 to 1986.Laboratories. Mr. Gardner's extensive career in the semiconductor industry, combined with his broad knowledge and understanding of our Company, the industry and the markets in which we operate, and the issues facing the Company, make Mr. Gardner a valuable member of our Board. Mr. Gardner received his BSEE degree from Cornell University and his MSEE degree from the University of California at Berkeley.

Steven P. Hanson, age 61, has beenserved as a director since August 16, 2007. For more than 32 years, Mr. Hanson has served in senior executive roles at technology companies, including 28 years at Motorola in various engineering management and leadership positions. Mr. Hanson served as the President and Chief Executive Officer of ON Semiconductor from 1999 to 2003. Mr. Hanson has been a senior partner at Southwest Value Acquisitions LLC, a private equity firm, since 2004. In addition Mr. Hanson serves on the Board of Deca Technologies Inc., a chip scale packaging company and subsidiary of



Cypress Semiconductor Corp. From 2007 to 2009, heHe served as the Chairman of InPlay Technologies, Inc., a high-technology firm delivering leadership human input device technologies and products. From 1999products from 2005 to 2003, Mr. Hanson was President and Chief Executive Officer of ON Semiconductor. He has served for more than 32 years in senior executive roles at technology companies, including 28 years at Motorola in various engineering management and leadership positions.2007. Mr. Hanson has served Arizona State University as a member of the Dean's Advisory Council, W.P. Carey School of Business and the Dean's Advisory Council for the Ira A. Fulton School of Engineering. As a former senior executive at technology companies including ON Semiconductor and the General Manager of Europe, Middle East and Africa Semiconductor Group of Motorola, Mr. Hanson brings operational, strategic and industry expertise to our Board. Mr. Hanson holds a BSEE degree from the College of Engineering at Arizona State University.

James H. Hugar, age 63, was appointed to the Board of Directors on has served as a director since October 30, 2009. Mr. Hugar recently retired from Deloitte & Touche, LLP, a public accounting firm, where he was an audit partner from 1982 to 2008, specializing in the financial services industry. Prior to his retirement, he also served as the partner-in-charge of the Southern California Investment Companies Industry and Broker/Dealer Practice Unit. Mr. Hugar currently expectsserves on the Board of Advisors of American Relocation & Logistics, Inc., a privately-held company. With over 35 years of experience in public accounting, including participation at hundreds of audit committee meetings and serving as a director/advisor for both privately and publicly held companies, Mr. Hugar brings public company financial expertise to join the board of directors of Imperial Capital Group, Inc. in connection with the closing of Imperial Capital Group, Inc.'s initial public offering.our Board. Mr. Hugar holds a bachelor'sBS degree in Accounting (cum laude) from Pennsylvania State University and an MSBA degree from the University of California, Los Angeles, and is a Certified Public Accountant.

G. Grant LyonScot B. Jarvis, age 46, was appointed to the Board of Directors on October 30, 2009. Mr. Lyon is the president of Odyssey Capital Group, LLC, a financial advisory and management consulting firm, which he founded in 1998. In 2005, he served as interim Chief Financial Officer of Hypercom Corporation. Before 2005, Mr. Lyon held positions as managing director at Ernst & Young Corporate Finance, LLC, a managing member of Golf Equity, LLC, vice president, Capital Markets at Evans Withycombe Residential, Inc. He began his career at Arthur Andersen LLP, where he worked from 1987 to 1997. Mr. Lyon has been involved in corporate initiatives that have included capital acquisition, business and securities valuation, acquisitions and mergers, and bankruptcy reorganizations. Mr. Lyon is a director of Fairfield Residential LLC and Chairman of the Board of Three Five Systems, Inc. He has also served as a director since May 2012. Mr. Jarvis co-founded Cedar Grove Partners, LLC, an investment and consulting/advisory partnership with a focus on wireless communication investments in 1997, and currently is its managing member. While at Cedar Grove, he has invested in several successful early-stage companies in the telecommunications area and has served on a number of Tickets.com,public and private boards. Prior to co-founding Cedar Grove, Mr. Jarvis served as a senior executive of Eagle River, Inc., a Craig McCaw investment firm. While at Eagle River, he founded Nextlink Communications on behalf of McCaw and served on its board of directors. He also served on the board of directors of Nextel Communications, NextG Networks, Inc., Wavelink Communications Inc., NextWeb, Inc., and Cantata Technologies, Inc. From 1985 to 1994, Mr. Lyon holds a bachelor's degree (magna cum laude)Jarvis served in several executive capacities at McCaw Cellular Communications up until it was sold to AT&T. Mr. Jarvis currently serves on the board of Kratos Defense & Security Solutions and an MBA degree (with high distinction) from Brigham Young University.Airspan Networks, both publicly traded companies. In addition, Mr. Jarvis currently serves on the board of directors of Good Technology, Inc., Root Wireless, Inc. and Slingshot Sports, LLC, all three of which are private companies. He is a Certified Public Accountantventure partner with Oak Investment Partners, a venture capital firm. Mr. Jarvis brings to our Board extensive experience in the technology industry and public company board experience. Mr. Jarvis holds a published author and speaker.BA degree in business administration from the University of Washington.

Edward Rogas, Jr., age 69, has beenserved as a director since January 24, 2006 and the Chairman of theour Board of Directors since December 2006. Mr. Rogas is currently retired.a director and consultant to companies in the technology industry. He served as a Senior Vice President at Teradyne, Inc., an automated test equipment manufacturer, from 2000 throughto 2005. From 1976 to 2000, he held various management positions in the semiconductor ATE portion of Teradyne's business,Teradyne, Inc., including Vice President from 1984 to 2000. Prior to that, fromFrom 1973 to 1976, he served as a Vice President at American Research and Development. Mr. Rogas is currentlyserves on the Board of FormFactor, Inc., a manufacturing test-technology




company, and Vignani Technologies, PvtPvt. Ltd. (a private Indian company). Mr. Rogas previously served on the board of directors of Photon Dynamics, Inc., a provider of digital imaging technology. Mr. Rogas brings to our Board extensive experience in engineering development and operations in the technology industry, financial sophistication and public company board experience. Mr. Rogas holds a bachelor'sBS degree from the United States Naval Academy and an MBA (with distinction)degree from Harvard Business School.
Kenneth H. Traub

        The authorized numberis the President and Chief Executive Officer of directorsEthos Management LLC, which specializes in investing in and advising undervalued companies to execute strategies to build and unlock stockholder value, a position he has held since January 2009. From 1999 until its acquisition by JDS Uniphase Corp. (“JDSU”) in February 2008, he served as President and Chief Executive Officer of American Bank Note Holographics, Inc. (“ABNH”), a leading global supplier of optical security devices. Mr. Traub managed the turnaround, growth and sale of ABNH, and under our bylaws ishis leadership, ABNH's stockholders achieved a minimumgain exceeding 1000 percent. Following the sale of fiveABNH, he served as Vice President of JDSU, a global leader in optical technologies and telecommunications, through September 2008. In 1994, Mr. Traub co-founded Voxware, Inc., a maximumpioneer in Voice Over Internet Protocol (“VoIP”) communication technologies, and served as its Executive Vice President and Chief Financial Officer through 1998. From 1988 to 1994, he served as Vice President of nine, withTrans-Resources, Inc., a multinational holding company and investment manager. Mr. Traub currently serves on the exact number set by the Board. Currently the authorized numberboards of directors of the Companyfollowing SEC reporting companies: (i) MRV Communications, Inc. (OTCQB: MRVC), a leading provider of Carrier Ethernet, wavelength division multiplexing optical transport, infrastructure management equipment and solutions, as well as network integration and managed services (Mr. Traub is five.

        Ascurrently Chairman of the Board), (ii) iPass, Inc. (NASDAQ: IPAS), a conditionleading global provider of mobility services for Enterprises and Carriers, (iii) MIPS Technologies, Inc. (NASDAQ: MIPS), a leading provider of industry standard processor architectures and cores, (iv) DSP Group, Inc. (NASDAQ: DSPG), a leading global provider of wireless chipset solutions for converged communications, and (v) Athersys, Inc. (NASDAQ: ATHX), a biotechnology company engaged in the discovery and development of therapeutic product candidates designed to extend and enhance the closingquality of our recently announced debt restructuring transaction,human life. Mr. Traub also serves as Chairman of the Company was obligated to appoint two qualified new directors prior toBoard of Omnego, Inc., a privately-held supplier of digital cards, tickets and coupons on mobile devices. He previously served on the Board of Directors of Phoenix Technologies, Inc. (NASDAQ: PTEC), a supplier of the basic input output system for the personal computer industry, from November 2, 2009 from a listuntil its sale in November 2010. He also served as the Chairman of at least four persons identified by the holdersBoard of our convertible debentures. The Companythe New Jersey chapter of the Young Presidents Organization in 2010 and 2011. He received a listBA degree from Emory College, and an MBA from Harvard Business School. Mr. Traub has over 20 years of eightsenior management, corporate governance, turnaround and transactional experience with various public and private companies. His wealth of board experience and corporate governance awareness from his current and past service as a director candidates fromwould allow him to provide valuable advice and guidance to our Board.

Board Election Arrangement
On November 20, 2012, Raging Capital Fund, LP (the “Fund”), a stockholder of ours, notified us that the holders ofFund intended to nominate Paul K. McWilliams and Kenneth H. Traub for election to our Board at the convertible debentures, including James H. Hugar and G. Grant Lyon. MembersAnnual Meeting. To provide us greater time to discuss with the Fund the appropriate composition of our Board, we rescheduled the date of the Annual Meeting from January 29, 2013 to March 7, 2013. Following a series of discussions that took place between representatives of the Fund and us, we expanded the potential nominees to also include Matthew Frey. Our Nominating and Corporate Governance Committee then reviewed the background and qualifications of each nominee, and of the eight candidatesthree nominees being considered deemed Messrs. Traub and conducted interviews with fourFrey the most qualified for service on our Board. The Board considered the Nominating and Corporate Governance Committee's assessment and decided to nominate Messrs. Traub and Frey for election to our Board at the Annual Meeting, and to keep the size of the candidates. As perBoard at seven with Messrs. LaRosa and Lyon not standing for re-election at the Annual Meeting. With the nominations of Messrs. Traub and Frey, the Fund has advised us that it will not nominate any other person for election to our independent directors selection process announced on July 17, 2007, these four candidates were also vetted by an independent executive search firm, McDermott & Bull. McDermott & Bull provided an assessment of each


Board at the Annual Meeting.

candidate's experience as compared to the qualifications criteria and Independence Standards as documented in the Company's Corporate Governance Guidelines. This document is available on the Company's website,http://www.vitesse.com, under "Investors—Corporate Governance." McDermott & Bull also conducted a comprehensive and confidential background investigation of the final candidates.

        The resignation of three of our former directors and the appointment of James H. Hugar and G. Grant Lyon to the Board to fill two of the resulting vacancies became effective on October 30, 2009, upon the closing of our debt restructuring transaction on October 30, 2009.

Director Independence

The Board has determined that with the exception of Mr. Gardner, all of its current members and the nominees for election at the Annual Meeting, other than Mr. Gardner, meet the criteria for independence set forth in the NASDAQ Listing Rules and the Company's Corporate Governance Guidelines. Mr. Gardner does not qualify as independent because he is a Vitesse employee. Our Corporate Governance Guidelines are posted on our websitehttp:// at www.vitesse.com, under "Investors—“Investors - Corporate Governance."

”

In making its determination, our Board Meetingsconsidered the objective tests and the subjective tests for determining who is an “independent director” under the NASDAQ Listing Rules. The subjective test states that an independent director must be a person who lacks a relationship that, in the opinion of our Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In assessing independence under the subjective test, our Board took into account the standards in the objective tests, and reviewed and discussed additional information provided by the directors and the Company with regard to each director's business and personal activities as they may relate to us and our management for the



three year period preceding the date of determination, including the circumstances leading to Messrs. Frey and Traub's nominations for election to the Board as well as the Fund's compensation of Mr. Traub for his service on the Board as disclosed in the Fund's filings with the SEC. Based on all of the foregoing, as required by NASDAQ rules, our Board made a subjective determination as to each independent director that no relationships exist which, in the opinion of our Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.
The Board and Board Committees

Board of Directors
The Board held a total of forty-four (44)nine meetings during fiscal year 2009. During fiscal year 2009, the Board had three standing committees: the Audit Committee; the Compensation Committee; and the Nominating and Corporate Governance Committee. In addition, in fiscal year 2009, the Board had one additional committee: the Strategic Development Committee. The Strategic Development Committee was dissolved effective as of October 30, 2009. Three of the members of that Committee, Guy Adams, Willow Shire and Robert Lundy, resigned from the Board effective as of October 30, 2009.2012. Each of our incumbent directors attended at least 75%75 percent of the aggregate of all meetings of theour Board and the committees of theour Board upon which such director served in fiscal year 2009.2012. Under our Corporate Governance Guidelines, theour Board is required to hold an executive session at each meeting of theour Board at which employee directors are not present.

Our Board has been chaired by Mr. Rogas since December 2006. As chairman of our Board, Mr. Rogas also serves as our Lead Director. The Board has elected to maintain a leadership structure with an independent director chairman, elected by vote of the independent directors, because we believe that, at this time, our Company and its stockholders are best served by having an independent chairman convene, establish, after consultation with management, set agenda items for and preside over meetings of our Board and executive sessions of the independent directors. We further believe that our corporate governance principles and policies ensure that strong and independent directors will continue to effectively oversee our management and key issues related to long-range business plans, strategic issues, risks and integrity.
During fiscal year 2012, our Board had three standing committees: the Audit Committee,

the Compensation Committee, and the Nominating and Corporate Governance Committee. Our Board also formed a Strategic Advisory Committee as an ad hoc committee of our Board with an indefinite term.

Audit Committee
The Audit Committee, which consists of Messrs. Hugar, Hanson, Jarvis, and Rogas, has been established in accordance with Section 3(a)(58)(A) of the Exchange Act, consists of directors Hugar, Hanson and Rogas.chaired by Mr. Hugar was appointed to the Committee as its Chairman onsince December 9, 2009. The Audit Committee held sixteen (16) meetings during fiscal year 2009. All of the members of the Audit Committee are "independent"“independent” as defined under rules promulgated by the SEC and meet the NASDAQ Listing Rules criteria for independence. TheOur Board has determined that Mr. Hugar is an "audit“audit committee financial expert"expert” as that term is defined in Item 407(d)(5) of Regulation S-K. Among other things, the Audit Committee assists our Board of Directors in its oversight of the integrity of our financial statements, the qualifications and independence of our independent audits,auditors, the performance of our internal audit function, compliance with legal and regulatory requirements, our disclosure controls, and systemour systems of internal controls. The Audit Committee held seven meetings during fiscal year 2012. A copy of the Audit Committee charter including any updates thereto, is available on our website at www.vitesse.com.

    www.vitesse.com under “Investors - Corporate Governance.”

Compensation Committee

The Compensation Committee, of the Boardwhich consists of directorsMessrs. Lyon, LaRosa and Rogas, both of whom were appointed to this Committee onhas been chaired by Mr. Lyon since December 9, 2009 following the resignation of directors Adams, Lundy and Shire from the Board effective as of October 30, 2009. The Compensation Committee held twelve (12) meetings during fiscal year 2009. The Compensation Committee, among other things, reviews and approves our executive compensation policies and programs, and grants stock options and other equity awards to our employees, including officers, pursuant to our stock optionincentive plans. See "Executive Officers and Executive Compensation—Compensation“Compensation Discussion and Analysis"Analysis” and "Director Compensation"


“Proposal One-Election of Directors-Director Compensation” below for a description of our processes and procedures for the consideration and determination of executive and director compensation. The Compensation Committee held seven meetings during fiscal year 2012. A copy of the Compensation Committee charter including any updates thereto, is available on our website at www.vitesse.com.

    www.vitesse.com under “Investors - Corporate Governance.”

Nominating and Corporate Governance Committee

The Nominating and Corporate Governance Committee, which consists of directorsMessrs. Hanson, Hugar and Hugar. During fiscal year 2009, the Governance and Nominating Committee consisted of directors Shire,LaRosa, has been chaired by Mr. Hanson and Lundy. Mr. Hugar was appointed to the Committee on December 9, 2009. The Nominating and Corporate Governance Committee held six (6) meetings during fiscal yearsince June 29, 2009. The Nominating and Corporate Governance Committee, among other things, assists theour Board by making recommendations to theour Board on matters concerning director nominations and elections, board committees and corporate governance. The Nominating and Corporate Governance Committee held six meetings during fiscal year 2012. A copy of the Nominating and Corporate Governance Committee charter including any updates thereto, is available on our website at www.vitesse.com.

    www.vitesse.com under “Investors - Corporate Governance.”

Strategic Advisory Committee



The Board forms ad hoc committees from time to time to assist our Board in fulfilling its responsibilities with respect to matters that are the subject of the ad hoc committee's mandate. During fiscal year 2012, the Board maintained a Strategic Advisory Committee to assist our Board by making recommendations on transactions and initiatives that the committee believes are reasonably likely to maximize stockholder value. The Strategic Advisory Committee has been chaired by Mr. Rogas since its formation, and currently consists of Messrs. Hanson, Hugar, Jarvis, LaRosa, Lyon and Rogas.
Corporate Governance Guidelines

The Company maintains a set of Corporate Governance Guidelines, which can also be found on our website at www.vitesse.com under "Investors—“Investors - Corporate Governance."” The Corporate Governance Guidelines cover a range of governance-relatedgovernance related matters, including requirements that theour Board of Directors maintain an independent Chairman of the Board, and that three-fourthsat least three fourths of our Board as well as the BoardAudit Committee, Compensation Committee and Nominating and Corporate Governance Committee consist of independent members.

    Codes The Corporate Governance Guidelines also provide that no director may serve on the board of more than three other public companies while serving on Vitesse's Board. Our Board waived this guideline with respect to Mr. Traub, who presently serves on the board of four public companies, to allow for his election to the Board at the Annual Meeting.

Code of Business Conduct and Ethics

We have adopted a Code of Business Conduct and Ethics for members of theour Board, of Directors, a Code of Business Conductour Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer and Ethics forController and persons performing similar functions, and all other officers and employees of the Company and its consolidated subsidiaries, and asubsidiaries. A copy of this Code of Ethics for the Chief Executive Officer and Senior Financial Officers that applies to our Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer/Controller and persons performing similar functions. Copies of these Codes areis posted on our websitehttp:// at www.vitesse.com, under "Investors—“Investors - Corporate Governance."” We intend to disclose any amendment to, or waiver from, the provisions of these Codesthis Code on our website at www.vitesse.com under "Investors—“Investors - Corporate Governance."

”

Board's Role in Risk Oversight
Our management team is responsible for identifying, assessing and managing the material risks facing our Company. Our Board's role in risk oversight includes receiving regular updates from management on areas of material risks and key strategies and initiatives. Our Board also participates in a review of the Company's annual operating plan, which includes the identification of the most significant risks facing our business and evaluation of how the Company's corporate strategies align to manage those risks. While our Board is ultimately responsible for risk oversight, each committee assists our Board in fulfilling its oversight responsibilities. The Audit Committee oversees management of financial risks. The Compensation Committee provides oversight of the Company's compensation policies and practices including risks associated with executive compensation. The Nominating and Corporate Governance Committee manages risks associated with corporate governance, including the independence of Board members, Board composition, and policies and procedures such as our Code of Business Conduct and Ethics and Corporate Governance Guidelines, used to promote ethical conduct and compliance with law.
The full Board has evaluated Vitesse's overall compensation policies and practices for its employees to determine whether such policies and practices create incentives that can affect Vitesse's risk and management of that risk, and has further assessed whether any risks arising from these policies and practices are reasonably likely to have a material adverse effect on us. Our Board has concluded that the risks arising from our policies and practices are not reasonably likely to have a material adverse effect on us.
The Compensation Committee and our Board, in connection with their assessment of performance criteria for fiscal year 2012, concluded that while the criteria or targets reward prudent risk-taking in support of our objectives, they do not encourage or promote inappropriate risk-taking by the participants.
Attendance at Annual Meeting of Stockholders by Directors

It is the policy of the Company that, absent extraordinary circumstances, each member of theour Board of Directors shall attend our annual meetingAnnual Meeting of stockholders.

Stockholders. All of our Board members attended the last year's Annual Meeting of Stockholders.

Compensation Committee Interlocks and Insider Participation
During fiscal year 2012, G. Grant Lyon, G. William LaRosa and Edward Rogas, Jr. served on the Compensation Committee. None of the committee members has ever served as an officer of Vitesse. None of the committee members served as an employee of Vitesse during fiscal year 2012 or had any relationship requiring disclosure by us under Item 404 of Regulation S-



K. During fiscal year 2012, none of our executive officers served on the compensation committee (or equivalent), or the board of directors, of another entity whose executive officer(s) served on our Compensation Committee or Board of Directors.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our executive officers, directors, and persons who own beneficially more than 10 percent of a registered class of our equity securities to file reports of ownership and changes in ownership within specified periods with the SEC. To our knowledge, based solely on our review of the copies of Section 16(a) forms required to be furnished to us with respect to fiscal year 2012 and written representations that no other reports were required, we believe that our executive officers, directors, and greater than 10 percent stockholders complied with the Section 16(a) reporting requirements during fiscal year 2012.
Process for Recommending Candidates for Election to theour Board of Directors

The Nominating and Corporate Governance Committee will consider nominees recommended by stockholders. A stockholder that desires to recommend a candidate for election to theour Board must direct the recommendation in writing to us at our principal offices (Attention: Tracy Kern, Corporate Controller)Secretary) and must include the candidate's name, age, home and business contact information, principal occupation or employment, the number of shares beneficially owned by the nominee, whether any hedging transactions have been entered into by the nominee or on his or her behalf, information regarding any arrangements or understandings between the nominee and the stockholder nominating the nominee or any other persons relating to the nomination, a written statement by the nominee acknowledging that the nominee will owe a fiduciary duty to the Company, if elected, and any other information required to be disclosed about the nominee if proxies were to be solicited to elect the nominee as a director. For a stockholder recommendation to be considered by the Nominating and Corporate Governance Committee as a potential candidate at an annual meeting,Annual Meeting, nominations must be received on or before the deadline for receipt of stockholder proposals for such meeting. In the event a



stockholder decides to nominate a candidate for director and solicits proxies for such candidate, the stockholder will need to follow the rules set forth by the SEC and in our bylaws. See "Information“Information Concerning Solicitation and Voting—Voting − Deadline for Receipt of Stockholder Proposals."

”

The Nominating and Corporate Governance Committee's criteria and process for evaluating and identifying the candidates that it approves as director nominees are as follows:

    •
The Nominating and Corporate Governance Committeecommittee regularly reviews the current composition and size of theour Board.

•
The Nominating and Corporate Governance Committeecommittee reviews the qualifications of any candidates who have been properly recommended by a stockholder, as well as those candidates who have been identified by management, individual members of theour Board or, if the Nominating and Corporate Governance Committeecommittee determines, a search firm. Such review may, in the Nominating and Corporate Governance Committee'scommittee's discretion, include a review solely of information provided to the Nominating and Corporate Governance Committeecommittee or may also include discussions with persons familiar with the candidate, an interview with the candidate or other actions that the Nominating and Corporate Governance Committeecommittee deems proper.

•
The Nominating and Corporate Governance Committeecommittee evaluates the performance of theour Board as a whole and evaluates the performance and qualifications of individual members of theour Board eligible for re-election at the annual meetingan Annual Meeting of stockholders.

•
Stockholders.
The Nominating and Corporate Governance Committeecommittee considers the suitability of each candidate, including the current members of theour Board, in light of the current size and composition of theour Board.  Except as may be required by rules promulgated by the NASDAQ Stock Market or the SEC, it is the currentcommittee’s belief of the Nominating and Corporate Governance Committee that there are no specific minimum qualifications that must be met by any candidate for theour Board, nor are there specific qualities or skills that are necessary for one or more of the members of theour Board to possess.  In selecting new directors of the Company, consideration will be given to each individual director'sdirector’s (i) personal qualities, experiences, and abilities; (ii) the collective skills of all of the directors, taking into account the responsibilities of theour Board; and (iii) qualifications imposed by law and regulation.  As stated in the Company'sCompany’s Corporate Governance Guidelines, the Company has the following expectations of its directors and director candidates:

•
Directors should possess the highest personal and professional ethics, integrity and values, and be committed to representing the long-term interests of the shareowners.

•
stockholders;
Directors must also have an inquisitive and objective perspective, practical wisdom and mature judgment.

•
The Company's directorsjudgment;
Directors should represent diverse experiences at a strategy/policy setting level, and should be people who have high-level managerial experience, and who are accustomed to dealing with complex problems.problems;


•

Directors must be willing to devote sufficient time to carrying out their duties and responsibilities effectively, and should be committed to serve on theour Board for an extended period of time.

•
time;
Directors should also possess a willingness to challenge and stimulate management and demonstrate the ability to work as part of a team in an environment of trust.

•
trust; and
Directors should offer their resignation in the event of any significant change in their personal circumstances, including a change in their principal job responsibilities.

The Nominating and Corporate Governance Committeecommittee may, from time to time,time-to-time, establish additional qualifications for directors as it shall deemdeems appropriate.


After such review and consideration, the Nominating and Corporate Governance Committeecommittee recommends the slate of directorDirector nominees to the full Board for its approval.

The Nominating and Corporate Governance Committee will endeavor to notify, or cause to be notified, all directorDirector candidates, including those recommended by a stockholder, of its decision as to whether to nominate such individual for election to theour Board.

Stockholder Communication with theour Board of Directors

        We believe that management speaks for Vitesse.

Any stockholder may contact any of our directorsDirectors by writing to them by mail, c/o our Corporate Secretary, at our principal executive offices, the address of which appears on the cover of this proxy statement.

Any stockholder may report to us any complaints regarding accounting, internal accounting controls or auditing matters. Any stockholder who wishes to so contact us should send such complaintscomments to the Audit Committee, c/o James H. Hugar, at our principal executive offices, the address of which appears on the cover of this proxy statement.

Any stockholder communications that thesent to our Board is to receive will first go to our Corporate Secretary, who will log the date of receipt of the communication as well as the identity and contact information of the correspondent in our stockholder communications log. After logging the communication, our Corporate Secretary will forward the communication to the Chairman of theour Board (in the case of communications directed to the whole Board) or to the applicable individual director(s)Director(s) addressed in the correspondence.

In the case of any complaints, the appropriate committee of theour Board will review and, if appropriate, investigate the complaint in a timely manner. In the case of accounting or auditing related matters, a member of the Audit Committee, or the Audit Committee as a whole, will review the summary of the communication, the results of the investigation, if any, and, if appropriate, the draft response. The summary and response will be in the form of a memo, which will become part of the stockholder communications log that the Corporate Secretary maintains with respect to all stockholder communications.


Director Compensation
The general policy of our Board is that compensation for non-employee directors should be a mix of cash and equity-based compensation. We do not pay management Directors for Board service in addition to their regular employee compensation. The Compensation Committee, which consists solely of Directors

        Effective April 1, 2010, after consultation with itsindependent directors, has the primary responsibility for reviewing and considering any revisions to director compensation. Our Board reviews the Compensation Committee's recommendations and determines the amount and type of director compensation.

The Compensation Committee can engage the services of outside advisers, experts and others to assist the committee. During fiscal year 2012, the Compensation Committee engaged independent compensation consultant, DolmatConnell & Partners,Radford, an Aon Hewitt Company, to review director compensation and make recommendations to the BoardCompensation Committee for changes in director compensation for fiscal year 2013. No changes in director compensation were made for fiscal year 2012.
Fiscal Year 2012 Compensation



For fiscal year 2012, non-employee director compensation consisted of Directors adopted the following compensation package for directors:

              (i)  directors receive an annualelements:

Annual retainer of $30,000, paid monthly;

         (ii)  the $30,000;

Chairperson of the Board (or Independent Lead Director if− additional retainer fee of $20,000;
Committee chairpersons − additional retainer fees of $20,000 for the Audit Committee, $12,000 for the Compensation Committee, and $8,000 for the Nominating and Corporate Governance Committee;
Committee membership (excluding chairpersons) − additional retainer fees of $8,000 for the Audit Committee, $6,000 for the Compensation Committee, and $4,000 for the Nominating and Corporate Governance Committee;
Board meeting fees − $1,500 for attendance at each in-person Board meeting and $750 for attendance at each scheduled conference call Board meeting;
Committee meeting fees −$1,000 for attendance at each in-person committee meeting and $500 for attendance at each scheduled conference call committee meeting; and
Annual equity compensation of $55,000 in the form of restricted stock units (RSUs), which RSUs are automatically granted on the second Monday in January of the applicable year and vest fully on the first anniversary of the grant date.
A non-employee director also was entitled to receive, upon initial election or appointment to our Board, a one-time award of equity compensation of $100,000 in the form of RSUs to be granted on the date of the Director's appointment or election to our Board and to vest in three annual installments of 33% on the first three anniversaries of the grant date.
Fiscal Year 2013 Compensation
Effective October 1, 2012, on the recommendation of the Compensation Committee, our Board of Directors modified non-employee director compensation to provide for a fixed amount of cash compensation for service on our Board and on each of our Board's standing committees, and to provide for grants of initial and annual RSU awards to be for a fixed number of shares. Prior to these changes, non-employee director compensation included a mix of fixed annual cash retainers and variable per meeting cash fees, and initial and annual equity awards determined based on a fixed dollar amount that resulted in the issuance of RSUs for a number of shares determined based on Vitesse's stock price at the time of the award.
Our Board may continue to provide for payment of per meeting cash fees for service on ad hoc committees of our Board established from time-to-time, and determined to pay such fees for service on the Strategic Advisory Committee. Our Board also authorized an additional grant of RSUs for service on the Strategic Advisory Committee.
For fiscal year 2013, non-employee director compensation consists of the following elements:
Annual retainer of $40,000;
Chairperson of the Board is an executive− additional retainer fee of the Company) receives an$25,000;
Committee chairpersons − additional annual retainer fees of $20,000;

        (iii)  the Chairperson of$20,000 for the Audit Committee, receives an$15,000 for the Compensation Committee, and $10,000 for the Nominating and Corporate Governance Committee;

Committee membership (excluding chairpersons) − additional annual retainer fees of $20,000 and each other member of$10,000 for the Audit Committee, receives an additional annual retainer of $8,000;

        (iv)  the Chairperson of$8,000 for the Compensation Committee, receives an additional annual retainerand $5,000 for the Nominating and Corporate Governance Committee;

Annual equity compensation of $12,000 and each other member9,500 restricted stock units (RSUs), which RSUs are automatically granted on the second Monday in January of the Compensationapplicable year and vest fully on the first anniversary of the grant date; and
Strategic Advisory Committee receivesmembership fees − $1,000 for attendance at each in-person meeting and $500 for attendance at each scheduled conference call meeting, and 4,000 RSUs to be automatically granted on the second Monday in January of the applicable year and vest fully on the first anniversary of the grant date.



A non-employee director also is entitled to receive, upon initial election or appointment to our Board, a one-time award of equity compensation of 14,000 RSUs to be granted on the date of the Director's appointment or election to our Board and to vest in three annual installments of 33% on the first three anniversaries of the grant date.
If a non-employee Director is appointed to our Board in between Annual Meetings of Stockholders, the annual cash compensation payable to that Director is pro-rated for the remaining portion of the term in which the director is appointed to our Board, and the first award of annual equity compensation to be automatically granted to the director on the second Monday in January of the year following the Director's appointment is pro-rated based on the length of the Director's service on our Board since the date of the previous year's annual award of equity compensation.
The following table details the total compensation earned by our non-employee Directors in fiscal year 2012. 
Director Summary Compensation
Director 
Fees Earned
or Paid in
Cash
 
Stock
Awards(1)(2)
 Total
Steven P. Hanson (3)(9) $67,000
 $55,000
 $122,000
James H. Hugar (4)(9) 74,250
 55,000
 129,250
Scot B. Jarvis (5)(9) 19,333
 100,000
 119,333
G. William LaRosa (6)(9) 60,500
 55,000
 115,500
G. Grant Lyon (7)(9) 56,000
 55,000
 111,000
Edward Rogas, Jr. (8)(9) 85,000
 55,000
 140,000
  $362,083
 $375,000
 $737,083
(1)    Represents awards of restricted stock units, each of which entitles the Director to receive one share of our Common Stock at the time of vesting, without the payment of an additionalexercise price or other cash consideration.
(2)    These amounts represent the grant date fair value of the stock awards granted in fiscal year 2012 determined in accordance with ASC Topic 718.  These amounts may not correspond to the actual value eventually realized by the Director, which depends in part on the market value of our Common Stock in future periods.  Assumptions used in calculating these amounts are set forth in the Notes to Consolidated Financial Statements included in our annual retainer of $6,000;

         (v)report on Form 10-K for the Chairpersonyear ended September 30, 2012.

(3)    Mr. Hanson served as Chairman of the Nominating and Corporate Governance Committee receives an additional annual retainerand a member of $8,000the Audit Committee and each otherStrategic Advisory Committee during fiscal year 2012.
(4)    Mr. Hugar served as Chairman of the Audit Committee and a member of the Nominating and Corporate Governance Committee receives an additional annual retainer of $4,000;

        (vi)  directors receive an additional $1,500 for each in-personduring fiscal year 2012.

(5)    Mr. Jarvis joined our Board meetingon May 9, 2012 and $750 for each scheduled conference call Board meeting that they attend and eachserved as member of the Audit Committee and Strategic Advisory Committee during fiscal year 2012.
(6)    Mr. LaRosa served as a member of the Compensation Committee and the Nominating and Governance Committee during fiscal year 2012.
(7)    Mr. Lyon served as Chairman of the Compensation Committee and a member of the Strategic Advisory Committee during fiscal year 2012.
(8)    Mr. Rogas served as Chairman of our Board and Chairman of the Strategic Advisory Committee receives $1,000and as a member of the Audit Committee and the Compensation Committee during fiscal year 2012.
(9)    On January 9, 2012, each of Messrs. Hanson, Hugar, LaRosa, Lyon, and Rogas received an RSU award for each in-person Committee meeting19,784 shares of Common Stock. Each RSU will vest in full on January 9, 2013. On May 9, 2012, Mr. Jarvis received an initial RSU award for 35,087 shares of Common Stock, which vests in three equal installments on the first, second and $500third anniversaries of the date of grant.
Stock Ownership Guidelines for each scheduled conference call Committee meeting that they attend; and

       (vii)  new directors appointed or elected to theNon-Employee Directors




The Board of Directors after April 1, 2010 will receivehas established stock ownership guidelines for non-employee directors. Each non-employee director is expected to own Vitesse Common Stock-based holdings equal in value to at least three times such director's annual cash retainer for service on our Board, excluding retainers and other amounts paid for service as Chairperson, Lead Director or on committees of our Board. Non-employee directors may count toward these guidelines the value of (i) shares they or their immediate family members own directly or in trust, including the vested portion of shares issued as restricted stock units onawards, and (ii) the date of their appointment or election to the Board of Directors with a value of $100,000 while continuing directors will receive an annual grantvested portion of restricted stock units withheld by them and for which shares of Common Stock have not been issued, including shares that have not been issued due to a valuerecipient's election to defer the settlement date for such vested restricted stock units. Each non-employee director is expected to achieve this level of $55,000 onownership by the second Monday in January.

        In October 2008,later of August 9, 2015 or the Boardthird anniversary of Directors formed the Strategic Development Committee. This Committee initially consisted of Edward Rogas, Jr., Steven Hanson and former director Guy Adams. The function of this Committee washis or her election to seek and evaluate various alternatives to refinancing the 2024 Debentures. The Strategic Development Committee received a monthly retainer of $10,000. In July 2009, the Board of Directors made the decision to expand the Strategic Development Committee to include directors Robert Lundy and Willow Shire. The Strategic Development Committee was dissolved upon the successful completion of the debt restructuring on October 30, 2009.

Director Compensation Table for Fiscal Year 2009

        The following table presents information regarding the compensation earned during fiscal year 2009 by members of our Board of Directors who were not alsoDirectors.

The share ownership of the non-employee directors is reported below, and is based on the closing market price of our employees (referred to as "Non-Employee Directors"Common Stock (which was $2.24 on January 11, 2013):
DirectorCurrent Ownership Guideline as a Multiple of Annual Cash Retainer Fee Ownership as a Multiple of Annual Cash Retainer Fee as of January 11, 2013
Steven P. Hanson3 3
James H. Hugar3 3
Scot B. Jarvis3 2
G. William LaRosa3 3
G. Grant Lyon3 4
Edward Rogas, Jr.3 3




PROPOSAL TWO

APPROVAL OF 2013 INCENTIVE PLAN

Proposal Two is approval of the Vitesse Semiconductor Corporation 2013 Incentive Plan (the “2013 Incentive Plan”). The compensation paidproposal to Mr. Gardner, who is employed by us, is presented below inapprove the Summary Compensation Table and2013 Incentive Plan requires the related explanatory tables. Directors who



are also officers or employeesaffirmative vote of a majority of the Companyshares of Common Stock present or its subsidiaries receive no additional compensation for their services as directors.

represented and entitled to vote at the Annual Meeting with respect to such proposal.
Name
 Fees Earned or
Paid in Cash		 Option
Awards(1)		 Total 

Guy W. Adams(2)

 $175,337 $18,410 $193,747 

Vincent Chan, Ph.D(3)

  
28,771		  
18,749		  
47,520		 

Steven P. Hanson(4)

  
165,254		  
19,180		  
184,434		 

Robert A. Lundy(5)

  
93,754		  
14,230		  
107,984		 

Edward Rogas, Jr.(6)

  
185,750		  
25,473		  
211,223		 

Willow B. Shire(7)

  
112,504		  
19,149		  
131,653		 
(1)
Amounts shown do not reflect compensation actually received by the directors. Instead, the amounts shown are the stock option related compensation costs recognized in fiscal year 2009 for financial statement reporting purposes as determined pursuant to ASC 718. The assumptions used in the calculation of values of option awards are set forth under our Forms 10-K for the years ended September 30, 2009 and prior.

(2)
Mr. Adams became a director on October 25, 2007 and resigned as a director effective October 30, 2009. Option awards amount reflects compensation costs recognized in fiscal year 2009 for stock option grants with the following fair values as of the grant date: 75,000 options granted on October 25, 2007 with a grant date fair value of $46,500 and 40,000 options granted on January 1, 2009 with a grant date fair value of $9,796. As of September 30, 2009, Mr. Adams had 115,000 options outstanding.

(3)
Dr. Chan resigned as a director on July 7, 2009. Option awards amount reflects compensation costs recognized in fiscal year 2009 for stock option grants with the following fair values as of the grant date: 40,000 options granted on January 1, 2004 with a fair value of $179,851, 40,000 options granted on January 1, 2005 with a fair value of $86,583, and 40,000 options granted on January 1, 2006 with a fair value of $57,531. As of September 30, 2009, Dr. Chan had 100,000 options outstanding.

(4)
Mr. Hanson became a director on August 16, 2007. Option awards amount reflects compensation costs recognized in fiscal year 2009 for 75,000 options granted on August 16, 2007 with a grant date fair value of $49,655 and 40,000 options granted on January 1, 2009 with a grant date fair value of $9,796. As of September 30, 2009, Mr. Hanson had 115,000 options outstanding.

(5)
Mr. Lundy became a director on May 2, 2008 and resigned as a director effective October 30, 2009. Option awards amount reflects compensation costs recognized in fiscal year 2009 for a stock option grant of 75,000 options granted on May 2, 2008 with a grant date fair value of $29,250 and 40,000 options granted on January 1, 2009 with a grant date fair value of $9,796. As of September 30, 2009, Mr. Lundy had 115,000 options outstanding.

(6)
Mr. Rogas became a director on January 24, 2006. Option awards amount reflects compensation costs recognized in fiscal year 2009 for 40,000 options granted on January 24, 2006 with a grant date fair value of $75,732 and 40,000 options granted on January 1, 2009 with a grant date fair value of $9,796. As of September 30, 2009, Mr. Rogas had 80,000 options outstanding.

(7)
Ms. Shire became a director on June 26, 2007 and resigned as a director effective October 30, 2009. Option awards amount reflects compensation costs recognized in fiscal year 2009 for stock option grants with the following fair values as of the grant date: 40,000 options granted on June 26, 2007 with a grant date fair value of $29,179, 35,000 options granted on July 27, 2007 with a grant date fair value of $25,172, and 40,000 options granted on January 1, 2009 with a grant date fair value of $9,796. As of September 30, 2009, Ms. Shire had 115,000 options outstanding.

Vote Required

        If a quorum is present, the five (5) nominees receiving the highest number of votes will be elected to the Board. See "Information Concerning Solicitation and Voting—Quorum; Abstentions; Broker Non-Votes."

THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE FIVE NOMINEES
PRESENTED HEREIN.



PROPOSAL TWO

APPROVAL OF THE VITESSE SEMICONDUCTOR CORPORATION 2010 INCENTIVE PLAN

Our board of directorsBoard believes that the effective usecontinued growth of stock-based, long-term incentive compensation is vital to ourVitesse depends, in large part, upon its ability to achieve continued strong performance in the future by providing a direct link between executive compensationattract and long-term stockholder value creation.motivate key employees and directors, and that equity incentive awards are an important means of attracting, retaining and motivating talented employees and directors. Accordingly, we are seeking stockholder approval of the Vitesse Semiconductor Corporation 20102013 Incentive Plan, or the "2010 Incentive Plan." The Our board adopted the 20102013 Incentive Plan, upon recommendation of its Compensation Committee, subject to stockholder approval at the Annual Meeting.

If the 20102013 Incentive Plan is approved by stockholders, it will replace the 2010 Vitesse Semiconductor Corporation 2001 Stock Incentive Plan, which we refer to in this proposal as the "Current“Current Incentive Plan" and in the text of the 2010 Incentive Plan as the "Prior Plan."” If stockholders approve the 20102013 Incentive Plan, no new awards will be granted under the Current Incentive Plan. If stockholders do not approve the 20102013 Incentive Plan, the Current Incentive Plan will remain available for new grants until it expires on October 17, 2010.

May 11, 2020.

The 20102013 Incentive Plan authorizes the issuance of 50,000,0006,700,000 shares of our common stock.Common Stock. In addition to the new shares authorized for issuance under the 2013 Incentive Plan, the 2013 Incentive Plan also provides that shares subject to awards outstanding under the Current Incentive Plan and the Vitesse Semiconductor Corporation 2001 Stock Incentive Plan (the “2001 Incentive Plan”) also may become available for issuance under the 2013 Incentive Plan to the extent that these shares cease to be subject to the awards (such as by expiration, cancellation or forfeiture of the awards). In the text of the 2013 Incentive Plan, we refer to the Current Incentive Plan and the 2001 Incentive Plan as the “Prior Plans.” As of March 26, 2010, 4,957,794January 11, 2013, 838,525 shares were available for issuance under the Current Incentive Plan, and these shares will be cancelled if the stockholders approve the 20102013 Incentive Plan. TheOur Board believes that these additional reserved shares are required in order for us to have an appropriate reserve of equity incentives to recruit, hire and retain the top talent that we will require to successfully execute our business strategy.

As of March 26, 2009,January 11, 2013, we had outstanding 404,841,80236,869,855 shares of our common stock. The newCommon Stock. If the 2013 Incentive Plan is approved by stockholders, the shares authorizedeligible for issuancegrant under the 20102013 Incentive Plan will represent approximately 11.1%18% of our shares of common stockCommon Stock currently outstanding. We anticipate granting awards for up to approximately 3.7% of the outstanding shares per year, as compared to the average run rate of 3% to 4% for our industry group. We anticipate that with the additional shares for which we are seeking stockholder approval, we will have sufficient shares reserved for our equity compensation program through fiscal year 2012, and that we will need to seek stockholder approval for additional shares at our 2012 annual stockholders meeting.

        While authorizing these additional shares for issuance under the 2010 Incentive Plan will increase the potential dilution represented by equity compensation awards, the potential dilution represented by our current outstanding equity compensation awards is very small relative to our peer group companies. The primary reason for this is that we have granted equity compensation awards with respect to relatively few shares over the past three years. In addition, a significant number of our outstanding stock options are "underwater" (the exercise prices are above the current market price of our common stock), which means that these stock options are unlikely to be exercised before they expire.

In addition to the new shares authorized for issuance under the 20102013 Incentive Plan, up to 40,577,825 shares subject to awards outstanding under the Current Incentive PlanPrior Plans (of which there were 2,833,602 shares as of January 11, 2013) may become available for issuance under the 20102013 Incentive Plan to the extent that these shares on or after the date of stockholder approval of the 20102013 Incentive Plan, cease to be subject to the awards (such as by expiration, cancellation or forfeiture of the awards).

        Although currently our common stock is not listed on any stock exchange, we are voluntarily soliciting stockholder approval of the 2010 Incentive Plan to provide the Compensation Committee with the flexibility to grant incentive stock options to employees under the 2010 Incentive Plan and certain awards that qualify as performance-based compensation under Section 162(m) of the Internal Revenue Code. See "U.S. Federal Income Tax Information."


The principal features of the 20102013 Incentive Plan are summarized below. This summary does not contain all information about the 20102013 Incentive Plan. A copy of the complete text of the 20102013 Incentive Plan is included as AppendixAnnex A to this proxy statement, and the following description is qualified in its entirety by reference to the text of the 20102013 Incentive Plan.





DESCRIPTION OF THE 20102013 INCENTIVE PLAN

Purpose

The purpose of the 20102013 Incentive Plan is to attract, retain and motivate our employees, officers and directors by providing them with the opportunity to acquire a proprietary interest in the Company and to align their interests and efforts to the long-term interests of our stockholders. The 20102013 Incentive Plan would also allowallows us to provide the same opportunity to consultants, agents, advisors and independent contractors.

Administration

The Compensation Committee of our Board of Directors will administeradministers the 20102013 Incentive Plan, except that our board administers the board will administer the 20102013 Incentive Plan with respect to our non-employee directors. TheOur Board or the Committeecommittee may delegate administration of the 20102013 Incentive Plan in accordance with its terms. References to the "Committee"“committee” in this Proposal Two are, as applicable, to the Compensation Committee, theour Board or other delegate, including an officer of the Company authorized by the boardour Board or Compensation Committee to make grants to certain eligible employees of the Company.

Eligibility

Awards may be granted under the 20102013 Incentive Plan to employees, officers, directors, consultants, agents, advisors and independent contractors of the Company and its subsidiaries and affiliates. As of March 26, 2009,January 11, 2013, approximately 439205 employees 3 executive officers, and 4six non-employee directors were eligible to receive awards under the 20102013 Incentive Plan.

Number of Shares

        The number

A total of 6,700,000 shares of common stockCommon Stock shall be authorized for issuance pursuant to awards granted under the 20102013 Incentive Plan is 50,000,000.Plan. In addition, any shares subject to outstandingawards granted under the Prior Plans may again become available for awards under the Current2013 Incentive PlanPlan.
Any shares that are subject to appreciation awards (such as stock options and stock appreciation rights) shall be counted against the plan share limit on a 1-for-1 basis for every such share subject to appreciation awards. Any shares that are subject to full value awards (such as awards of stock, restricted stock and restricted stock units) shall be counted against the dateplan share limit at a ratio of stockholder approval of1.5 shares for every share subject to the 2010 Incentive Planfull value award. Shares that cease to be subject to these awards (other than from exercise or settlement ofunder the 2013 Incentive Plan and the Prior Plans, to the extent such shares again become available for awards in shares)under the 2013 Incentive Plan, will automatically becomeincrease the shares available for issuance under the 20102013 Incentive Plan upat a ratio of 1.5 shares for every share subject to a full value award and on a 1-for-1 basis for every share subject to an aggregate maximum of up to 40,577,825 shares. The maximum number of shares of common stock that may be issued pursuant to the exercise of incentive stock options is the same as the total number of shares authorized under the 2010 Incentive Plan.

appreciation award.

The following shares will be available again for issuance under the 20102013 Incentive Plan:

subject to awards that lapse, expire, terminatethe discussion in the bullet immediately below, if any award granted under the 2013 Incentive Plan or are canceled prior to issuancethe Prior Plans expires or is terminated, surrendered or cancelled without having been fully exercised, is forfeited in whole or in part (including as a result of the underlying shares;

•
shares subject to awards that are subsequently forfeited to or otherwise reacquired by us;

•
shares related to an award thatCompany's contractual repurchase right), is settled in cash or otherwise results in another manner where someany shares being forfeited or all ofnot being issued, the unused shares covered by thesuch award are added back into the reserve of shares available for future awards under the 2013 Incentive Plan;
shares withheld or tendered in connection with the exercise of a full value award (but not issued; and

•
shares subjectan appreciation award) or to an award that are tendered or withheld in payment of purchase price orsatisfy tax withholding obligations.
obligations of a full value award (but not an appreciation award) may be added back into the share reserve; and

        Awardsawards granted in assumption of or substitution for previously granted awards in acquisition transactions will not reduce the number of shares authorized for issuance under the 20102013 Incentive Plan.

The maximum number of shares of Common Stock that may be issued pursuant to the exercise of incentive stock options is the same as the total number of shares authorized under the 2013 Incentive Plan.
If any change in our stock occurs by reason of any stock dividend, stock split, spin-off, recapitalization, merger, consolidation, combination or exchange of shares, distribution to stockholders other than a normal cash dividend or other change in our corporate or capital structure, the Committeecommittee will make proportional adjustments to the maximum number and kind of securities (a) available for issuance under the 20102013 Incentive Plan, (b) issuable as incentive stock options, (c) issuable to certain




individuals subject to Code Section 162(m), and (d) subject to any outstanding award, including the per share price of such securities.

Types of Awards

The 20102013 Incentive Plan permits the grant of any or all of the following types of awards.

Stock Options. The Committeecommittee may grant either incentive stock options, which must comply with Code Section 422, or nonqualified stock options. The committee sets option exercise prices and terms, except that the exercise price of stock options granted under the 20102013 Incentive Plan must be at least 100% of the fair market value of the common stockCommon Stock on the date of grant, except in the case of options granted in connection with assuming or substituting options in acquisition transactions. At the time of grant, the Committeecommittee determines when stock options are exercisable and when they expire, except that the term of a stock option cannot exceed ten10 years. Unless the committee otherwise determines, fair market value means, as of a given date, the closing price of our common stock.Common Stock on that date.

Stock Appreciation Rights (SARs). The committee may grant SARs as a right in tandem with the number of shares underlying stock options granted under the 20102013 Incentive Plan or on a stand-alone basis. SARs are the right to receive payment per share of an exercised SAR in stock or cash, or a combination of stock and cash, equal to the excess of the share's fair market value on the date of exercise over its fair market value on the date the SAR was granted. Exercise of an SAR issued in tandem with stock options will result in the reduction of the number of shares underlying the related SAR to the extent of the SAR exercised. The term of a stand-alone SAR cannot be more than ten10 years, and the term of a tandem SAR will not exceed the term of the related option.

Stock Awards, Restricted Stock and Stock Units. The Committeecommittee may grant awards of shares of common stock,Common Stock, or awards designated in units of common stock,Common Stock, under the 20102013 Incentive Plan. These awards may be made subject to repurchase or forfeiture restrictions at the Committee'scommittee's discretion. The restrictions may be based on continuous service with us or the achievement of specified performance criteria, as determined by the Committee.committee.

Performance Awards. The Committeecommittee may grant performance awards in the form of performance shares or performance units. Performance shares are units valued by reference to a designated number of shares of common stock,Common Stock, and performance units are units valued by reference to a designated amount of cash. Either may be payable in stock or cash, or a combination of stock and cash, upon the attainment of performance criteria and other terms and conditions as established by the committee.

Other Stock or Cash-Based Awards. The Committeecommittee may grant other incentives payable in cash or in shares of common stock,Common Stock, subject to the terms of the 20102013 Incentive Plan and any other terms and conditions determined by the Committee.committee.

Repricing

The 20102013 Incentive Plan prohibits the Committee,committee, without stockholder approval, from lowering the price of an option after it is granted, except in connection with adjustments provided under the 2010



2013 Incentive Plan, taking any other action that is treated as a repricing under generally accepted accounting principles, or canceling an option at a time when its strike price exceeds the fair market value of the underlying stock, in exchange for another option, restricted stock or units, or other equity, unless the cancellation and exchange occurs in connection with a merger, acquisition, spin-off or other similar corporate transaction.

Performance-Based Compensation under Code Section 162(m)

Performance Goals and Criteria. If the Committeecommittee intends to qualify an award under the 20102013 Incentive Plan as "qualified“qualified performance-based compensation"compensation” under Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code"“Code”), the performance goals selected by the Committeecommittee may be based on the attainment of specified levels of one, or any combination, of the following performance criteria for the Company as a whole or any business unit, as reported or calculated by the Company: cash flows (including, but not limited to, operating cash flow, free cash flow or cash flow return on capital); working capital; earnings per share; book value per share; operating income (including or excluding depreciation, amortization, extraordinary items, restructuring charges or other expenses); revenues; operating margins; return on assets; return on equity; debt; debt plus equity; market or economic value added; stock price appreciation; total stockholder return; cost control; strategic initiatives; market share; net income; return on invested capital; improvements in capital structure; or customer satisfaction, employee satisfaction, services performance, subscriber, cash management or asset management metrics.





The performance goals also may be based on the achievement of specified levels of performance for the Company as a whole or any business unit or applicable affiliate under one or more of the performance goals described above relative to the performance of other corporations.

The Committeecommittee may provide in any award that any evaluation of performance may include or exclude any of the following events that occur during a performance period: asset write-downs, litigation or claim judgments or settlements, the effect of changes in tax laws, accounting principles, or other laws or provisions affecting reported results, any reorganization and restructuring programs, extraordinary nonrecurring items as described in Accounting Principles Board Opinion No. 30 and/or in Management's Discussion and Analysis of Financial Condition and Results of Operations appearing in the Company's annual report to stockholders for the applicable year, acquisitions or divestitures, foreign exchange gains and losses, and gains and losses on asset sales.

Adjustments and Certification. The Committeecommittee may adjust the amount payable pursuant to an award under the 20102013 Incentive Plan that is intended to qualify as "performance-based compensation"“performance-based compensation” under Section 162(m) downward, but not upward. The Committeecommittee may not waive the achievement of performance goals related to an award except in the case of a participant's death or disability. Section 162(m) requires that the Committeecommittee certify that performance goals were achieved before the payment of the "performance-based“performance-based compensation."”

Limitations. Subject to certain adjustments, participants who are granted awards intended to qualify as "performance-based compensation"“performance-based compensation” under Section 162(m) may not be granted awards, other than performance units, for more than 5,000,000600,000 shares of common stockCommon Stock in any calendar year, except that additional awards for up to 5,000,000600,000 shares may be granted to newly hired or promoted individuals in any calendar year. The maximum dollar value payable to any participant with respect to performance units or other awards payable in cash that are intended to qualify as "performance-based compensation"“performance-based compensation” cannot exceed $3,000,000 in any calendar year.


Change of Control

Under the 20102013 Incentive Plan, unless otherwise provided in the instrument evidencing an award or in a written employment, services or other agreement between the participant and us, in the event of a change of control:

Upon certain changes of control, such as specified reorganizations, mergers or consolidations, the awards will become fully and immediately exercisable, and all applicable deferral and restriction limitations or forfeiture provisions will lapse, only if and to the extent the awards are not converted, assumed or replaced by a successor company. Except for such specified types of changes of control, all outstanding awards, other than performance shares and performance units, will become fully and immediately exercisable and all applicable deferral and restriction limitations or forfeiture provisions will lapse, immediately prior to the change of control and the awards will terminate at the effective time of the change of control.

•
All performance shares and performance units will be payable based on targeted performance being attained as of the effective date of the change of control and will be paid in accordance with the payout schedule for the award.

•
In the event of certain reorganizations, mergers or consolidations, the Committeecommittee may, in its discretion, instead provide that a participant's outstanding awards will be cashed out.

Definition of Change of Control. Unless the committee determines otherwise with respect to an award at the time it is granted or unless otherwise defined for purposes of an award in a written employment, services or other agreement between a participant and us, a change of control of the Company generally means the occurrence of any of the following events:

an acquisition by any individual, entity or group of beneficial ownership of 40% or more of either (a) the then outstanding shares of common stockCommon Stock or (b) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (excluding generally any acquisition directly from the Company, any acquisition by the Company, any acquisition by any employee benefit plan of the Company or an affiliate, or the completion of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company pursuant to which specific requirements are met);

•
a change in the composition of the board of directors in any two-year period with the result that the incumbent board members cease to constitute at least a majority of the board (not including directors whose election, or nomination for election by stockholders, was approved by a majority of the incumbent board); or


•


completion of specified reorganizations, mergers or consolidations or other disposition of all or substantially all of the assets of the Company.

Amendment and Termination

The Board of Directors or the committee may amend the 20102013 Incentive Plan, except that if any applicable statute, rule or regulation requires stockholder approval for an amendment to the 20102013 Incentive Plan, then to the extent so required, stockholder approval will be obtained. TheOur Board or the Committeecommittee may also suspend or terminate all or any portion of the 20102013 Incentive Plan at any time, but any suspension or termination may not, without a participant's consent, materially adversely affect any rights under any outstanding award. Unless sooner terminated by theour Board or Committee,committee, the 20102013 Incentive Plan will terminate ten years after the date of stockholder approval of the 2010 Incentive Plan.

on January 14, 2023.

U.S. Federal Income Tax Information

The following is a brief summary of the U.S. federal income tax consequences of the 20102013 Incentive Plan generally applicable to us and to participants in the 20102013 Incentive Plan who are subject to U.S. federal taxes. The summary is based on the Code, applicable Treasury Regulations and administrative and judicial interpretations thereof, each as in effect on the date of this proxy statement and is, therefore, subject to future changes in the law, possibly with retroactive effect. The summary is general in nature and does not purport to be legal or tax advice. Furthermore, the summary does not address issues relating to any U.S. gift or estate tax consequences or the consequences of any state, local or foreign tax laws.

Nonqualified Stock Options. A participant generally will not recognize income upon the grant or vesting of a nonqualified stock option with an exercise price at least equal to the fair market value of our common stockCommon Stock on the date of grant and no additional deferral feature. When a nonqualified stock option is exercised, a participant generally will recognize compensation taxable as ordinary income in an amount equal to the difference between the fair market value of the shares underlying the option on the date of exercise and the option exercise price. When a participant sells the shares, the participant will have short-term or long-term capital gain or loss, as the case may be, equal to the difference between the amount the participant received from the sale and the tax basis of the shares sold. The tax basis of the shares generally will be equal to the greater of the fair market value of the shares on the exercise date or the option exercise price.

Incentive Stock Options.A participant generally will not recognize income upon the grant of an incentive stock option. If a participant exercises an incentive stock option during employment as an employee or within three months after his or her employment ends (12 months in the case of permanent and total disability), the participant will not recognize income at the time of exercise for regular U.S. federal income tax purposes (although the participant generally will recognize income for alternative minimum tax purposes at that time as if the option were a nonqualified stock option). If a participant sells or otherwise disposes of the shares acquired upon exercise of an incentive stock option after the later of (a) one year from the date the participant exercised the option and (b) two years from the grant date of the option, the participant generally will recognize long-term capital gain or loss equal to the difference between the amount the participant received in the disposition and the option exercise price. If a participant sells or otherwise disposes of shares acquired upon exercise of an incentive stock option before these holding period requirements are satisfied, the disposition will constitute a "disqualifying“disqualifying disposition,"” and the participant generally will recognize taxable ordinary income in the year of disposition equal to the excess of the fair market value of the shares on the date of exercise over the option exercise price (or, if less, the excess of the amount realized on the disposition of the shares over the option exercise price). The balance of the participant's gain on a disqualifying disposition, if any, will be taxed as short-term or long-term capital gain, as the case may be.

With respect to both nonqualified stock options and incentive stock options, special rules apply if a participant uses shares of common stockCommon Stock already held by the participant to pay the exercise price.

Stock Appreciation Rights. A participant generally will not recognize income upon the grant or vesting of an SAR with a grant price at least equal to the fair market value of our common stockCommon Stock on the date of grant and no additional deferral feature. Upon the exercise of an SAR, a participant generally will recognize compensation taxable as ordinary income in an amount equal to the difference between the fair market value of the shares underlying the SAR on the date of exercise and the grant price of the SAR.

Unrestricted Stock Awards. Upon receipt of an unrestricted stock award, a participant generally will recognize compensation taxable as ordinary income in an amount equal to the excess of the fair



market value of the shares at such time over the amount, if any, paid by the participant with respect to the shares.





Restricted Stock Awards. Upon receipt of a restricted stock award, a participant generally will recognize compensation taxable as ordinary income when the shares cease to be subject to restrictions in an amount equal to the excess of the fair market value of the shares at such time over the amount, if any, paid for the shares. Instead of postponing the federal income tax consequences of a restricted stock award until the restrictions lapse, a participant may elect to recognize compensation taxable as ordinary income in the year of the award in an amount equal to the fair market value of the shares at the time of receipt. This election is made under Section 83(b) of the Code. In general, a Section 83(b) election is made by filing a written notice with the Internal Revenue Service within 30 days of the date of grant of the restricted stock award for which the election is made and must meet certain technical requirements.

The tax treatment of a subsequent disposition of restricted stock will depend upon whether a participant has made a timely and proper Section 83(b) election. If a participant makes a timely and proper Section 83(b) election, when the participant sells the restricted shares, the participant generally will recognize short-term or long-term capital gain or loss, as the case may be, equal to the difference between the amount the participant receives from the sale and the tax basis of the shares sold. If no Section 83(b) election is made, any disposition after the restriction lapses generally will result in short-term or long-term capital gain or loss, as the case may be, equal to the difference between the amount the participant received from the sale and the tax basis of the shares sold. The tax basis of the shares generally will be equal to the amount, if any, the participant paid for the shares plus the amount of taxable ordinary income recognized either at the time the restrictions lapsed or at the time of the Section 83(b) election, if an election was made. If a participant has to forfeit the shares to us (e.g., upon the participant's termination prior to expiration of the restriction period), the participant may not claim a deduction for the amount of compensation income recognized as a result of making the Section 83(b) election, and the participant generally will have a capital loss equal to the amount, if any, paid for the shares.

Restricted Stock Units. A participant generally will not recognize income at the time a stock unit is granted. When any part of a stock unit is issued or paid, the participant generally will recognize compensation taxable as ordinary income at the time of such issuance or payment in an amount equal to the then fair market value of any shares, cash or property the participant receives.

Performance Shares and Performance Units. A participant generally will not recognize income upon the grant of performance shares or performance units. Upon the distribution of cash, shares or other property to the participant pursuant to the terms of the performance shares or units, the participant generally will recognize compensation taxable as ordinary income equal to the excess of the amount of cash or the fair market value of any property transferred to the participant over any amount paid by the participant with respect to the performance shares or units.

Tax Consequences to the Company. In the foregoing cases, we generally will be entitled to a deduction at the same time and in the same amount as a participant recognizes ordinary income, subject to certain limitations imposed under the Code.

Code Section 409A.409A. We intend that awards granted under the 20102013 Incentive Plan comply with, or otherwise be exempt from, Code Section 409A, but make no representation or warranty to that effect.

Code Section 162(m). Under Code Section 162(m), we are generally prohibited from deducting compensation paid to "covered employees"“covered employees” in excess of $1,000,000 per person in any year. "Covered employees"“Covered employees” are defined as the principal executive officer and any one of the three highest paid executive officers (other than the principal executive officer or the principal financial officer) as of the



close of the applicable taxable year. Compensation that qualifies as "performance-based"“performance-based” is excluded for purposes of calculating the amount of compensation subject to the $1,000,000 limit. In general, one of the requirements that must be satisfied to qualify as performance-based compensation under Code Section 162(m) is that the material terms of the performance goals under which the compensation may be paid must be disclosed to and approved by a majority vote of our stockholders. Accordingly, stockholder approval of the 20102013 Incentive Plan is necessary to ensure that we have the ability to exclude taxable compensation attributable to stock options, stock appreciation rights and performance-based awards under the 20102013 Incentive Plan that are intended to qualify as "qualified“qualified performance-based compensation"compensation” under Code Section 162(m) from the limits on tax deductibility imposed by Section 162(m).

Tax Withholding. We are authorized to deduct or withhold from any award granted or payment due under the 20102013 Incentive Plan, or require a participant to remit to us, the amount of any withholding taxes due in respect of the award or payment and to take such other action as may be necessary to satisfy all obligations for the payment of applicable withholding taxes. We are not required to issue any shares of common stockCommon Stock or otherwise settle an award under the 20102013 Incentive Plan until all tax withholding obligations are satisfied.





Plan Benefits
We have adopted a program that provides for the automatic grant of RSUs to non-employee directors of Vitesse under the Current Incentive Plan. If approved, we will continue this program for the 2013 Incentive Plan.
Initial Awards.

        All Upon a non-employee director's initial election or appointment to our Board, the director is automatically granted an RSU for 14,000 shares of our Common Stock on the date of grant, which vests in three equal annual installments so long as the director is providing continuous service on our Board.

Annual Awards. Each year on the second Monday in January, each non-employee director who is then serving on our Board is automatically granted an RSU for 9,500 shares of our Common Stock, which RSU vests in full on the first anniversary of the date of grant; provided, however, that if a director initially becomes a non-employee director after the date of the previous year's annual grant, such director shall receive a pro-rated annual award based on the portion of the immediately preceding year during which he or she served as a non-employee director. The next scheduled annual award of RSUs to our non-employees directors (currently Messrs. Hanson, Hugar, Jarvis, LaRosa, Lyon and Rogas) will be made on Monday, January 14, 2013.
In addition, each non-employee director who is serving on the Strategic Advisory Committee on the second Monday in January also will be automatically granted an RSU for 4,000 shares of our Common Stock, which RSU vests in full on the first anniversary of the date of grant. The last scheduled annual award of RSUs to our non-employees directors serving on the Strategic Advisory Committee (currently Messrs. Hanson, Hugar, Jarvis, and Rogas) occurred on Monday, January 14, 2013.
With the exception of automatic awards to non-employee directors, all awards to employees, officers, directors and consultants under the 2010 Incentive Plan arewill be made at the discretion of the Compensation Committee.committee. Therefore, the benefits and amounts that will be received or allocated under the 20102013 Incentive Plan are not determinable at this time. However, please refer to the description of grants made to our named executive officers in the last fiscal year described in the "Grants“Grants of Plan-Based Awards in Fiscal Year 2009"2012” table. Grants made to our non-employee directors in the last fiscal year are described in the "Director Compensation"“Director Compensation” section. The closing price of our common stock,Common Stock, as reported on the Pink SheetsNASDAQ Global Market on March 26, 2010,September 30, 2012, was $0.349$2.44 per share.



EQUITY COMPENSATION PLAN INFORMATION

Equity Compensation Plan Information Table

The following table provides information as of September 30, 20092012 concerning securities authorized for issuance under our equity compensation plans of the Company.

plans:

 
 A B C 
Plan Category
 Number of
Securities to be
Issued upon
Exercise of
Outstanding
Options,
Warrants and
Rights		 Weighted
Average Exercise
Price of
Outstanding
Options,
Warrants and
Rights		 Number of
Securities
Remaining
Available for
Future Issuance
Under Equity
Compensation
Plans (Excluding
Securities
Reflected in
Column A)		 

Equity Compensation Plans approved by Shareholders(1)

  21,939,222(2)$4.56(3) 25,394,347 

Equity Compensation Plans not approved by Shareholders(4)

  2,696,743  6.05  560,215 
        
 

Total(5)

  24,635,965 $4.72  25,954,562 
        

 A
B C
Plan Category  Number of Securities
to be Issued upon
Exercise of
Outstanding Options,
Warrants or Rights
Weighted Average Exercise Price of Outstanding Options (3) Number of Shares Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Shares Reflected in Column A)
Equity compensation plans approved by security holders (1) 4,024,617
(2)$9.20
 605,805
(4)
Equity compensation plans not approved by security holders (5) 80,998

60.10
 —
 
Total 4,105,615

$10.38
 605,805
 
(1)Consists of the Current Incentive Plan and the 2001 Stock Incentive Plan. No additional awards are being made under the 2001 Stock Incentive Plan.
(2)Includes 1,685,564 RSUs, which do not have an exercise price.
(3)Consists of the weighted average exercise price for stock options only.
(4)Consists of shares of our Common Stock reserved for issuance under the Current Incentive Plan.  Shares available for issuance under the Current Incentive Plan can be granted pursuant to stock options, stock appreciation rights, restricted stock or units, performance units, performance shares and any other stock based award selected by the Compensation Committee.


(1)
Consists of the 2001 Stock Incentive Plan, the 1991 Stock Option Plan, the 1991 Directors' Stock Option Plan and the 1991 Employee Stock Purchase Plan. No additional awards are being made under the 1991 Stock Option Plan or the 1991 Directors' Stock Option Plan. The 1991 Employee Stock Purchase Plan was suspended in July 2006.


(2)
Includes 3,443,253 RSUs, which do not have an exercise price.

(3)
Includes weighted average exercise price for stock options only.

(4)
Consists of the Vitesse International Inc. 1999 International Stock Option Plan, which was adopted in 1999 to provide for the grant to international employees of incentive stock options and the assumption of options under plans of foreign subsidiaries. The Vitesse International Inc. 1999 International Stock Option Plan expired on October 31, 2009.

(5)
The table does not include information for equity compensation plans assumed by the Company in connection with acquisitions of the companies that originally established those plans. As of September 30, 2009, a total of 56,971 shares of the Company's common stock were issuable upon exercise of outstanding options under those assumed plans. The weighted average exercise price of those options outstanding is $19.55 per share. No additional options may be granted under those assumed plans.

(5)Consists of the Vitesse International Inc. 1999 International Stock Option Plan, which was adopted in 1999 to provide for the grant to international employees of incentive stock options and the assumption of options under plans of foreign subsidiaries. The Vitesse International Inc. 1999 International Stock Option Plan expired on October 31, 2009.  No additional options may be granted under the 1999 International Stock Option Plan. 

Vote Required

        If a quorum is present, the

The approval of the 2010Amendment of the 2013 Incentive Plan will require the affirmative vote of a majority of the shares votingof Common Stock present or represented and entitled to vote at the Annual Meeting.Meeting with respect to such proposal. See "Information“Information Concerning Solicitation and Voting—Quorum;Voting-Quorum; Abstentions; Broker Non-Votes."

”

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOUA VOTE "FOR"
“FOR” APPROVAL OF THE VITESSE SEMICONDUCTOR CORPORATION 20102013 INCENTIVE PLAN.






PROPOSAL THREE
ADVISORY VOTE ON EXECUTIVE COMPENSATION
 Under the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”), we are required to include in this proxy statement and present at the Annual Meeting a non-binding stockholder vote to approve the compensation of our executives, as described in this proxy statement, pursuant to the compensation disclosure rules of the SEC. This proposal, commonly known as a “say on pay” vote, gives stockholders the opportunity to endorse or not endorse the compensation of our executives as disclosed in this proxy statement. This proposal will be presented at the Annual Meeting as a resolution in substantially the following form:
RESOLVED, that the stockholders approve the compensation of the Company's executives, as disclosed in the Compensation Discussion and Analysis, the compensation tables and related narrative disclosure in the Company's proxy statement for the Annual Meeting.
This vote will not be binding on our Board of Directors and may not be construed as overruling a decision by our Board or creating or implying any change to the fiduciary duties of our Board. The vote will not affect any compensation previously paid or awarded to any executive. The Compensation Committee and the Board may, however, take into account the outcome of the vote when considering future executive compensation arrangements.
The purpose of our compensation programs is to attract and retain experienced, highly-qualified executives critical to our long-term success and enhancement of stockholder value.
Required Vote
Endorsement of the compensation of our executive officers will require the affirmative vote of a majority of the shares of Common Stock present or represented and entitled to vote at the Annual Meeting with respect to such proposal. See “Information Concerning Solicitation and Voting-Quorum, Abstentions, Broker Non-Votes, Required Votes.”
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” ENDORSEMENT OF THE COMPENSATION OF OUR EXECUTIVE OFFICERS.





PROPOSAL FOUR
RATIFICATION OF APPOINTMENTSELECTION OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee of the Board has selected BDO Seidman,USA, LLP, an independent registered public accounting firm, to audit our financial statements for the fiscal year ending September 30, 2010,2013, and recommends that stockholders vote for ratification of such appointment. BDO Seidman,USA, LLP has audited our financial statements since the fiscal year ended September 30, 2008. Although ratification by stockholders is not required by law, the Audit Committee has determined that it is desirable to request ratification of this selection by the stockholders as a matter of good corporate practice. Notwithstanding its selection, the Audit Committee, in its discretion, may appoint a new independent registered public accounting firm at any time during the fiscal year if the Audit Committee believes that such a change would be in the best interest of Vitesse and its stockholders. If the stockholders do not ratify the appointment of BDO Seidman,USA, LLP, the Audit Committee may reconsider its selection. The Audit Committee selected BDO Seidman, LLP to audit our financial statements for the fiscal year ended September 30, 2009.

Representatives of BDO Seidman,USA, LLP are expected to be present at the meeting and will be afforded the opportunity to make a statement if they desire to do so. The representatives of BDO Seidman,USA, LLP are also expected to be available to respond to appropriate questions.

Principal Accounting

Fees Paid to BDO USA, LLP and Services

BDO USA, LLP International Firms

The following table shows the approximatesets forth fees billedfor services paid to us by BDO Seidman,USA, LLP, our independent registered public accounting firm:

firm and BDO USA, LLP International firms, for the fiscal years ended September 30, 2012 and 2011:

 
 2009 2008 

Audit Fees

 $2,694,422 $2,376,850 

Audit-Related Fees

  
140,958		  
—		 

Tax Fees

  
309,892		  
120,450		 

All Other Fees

  
—		  
—		 
      

Total

 
$
3,145,272		 
$
2,497,300		 
      
  2012 2011
Audit Fees (1) $589,270
 $542,016
Audit-Related Fees (2) —
 13,288
Tax Fees (3) 9,744
 282,834
All Other Fees —
 —
Total $599,014
 $838,138

Audit Fees

        This category includes the audit of our annual financial statements, review of financial statements included in our Form 10-Q quarterly reports, and services that are normally provided in connection with statutory and regulatory filings or engagements for those fiscal years. This category also includes advice on accounting matters that arose during, or as a result of, the audit or the review of interim financial statements, statutory audits required by non-U.S. jurisdictions and the preparation of an annual "management letter" on internal control matters.

Audit-Related Fees

        This category consists of professional services rendered primarily in connection with our debt restructuring activities. These professional services continued through consummation of the debt restructuring on October 30, 2009, as discussed in our annual report on Form 10-K for the year ended September 30, 2009.


(1)Audit fees include the audit of our annual financial statements and consent for SEC filings, the audit of management's assessment of our internal control over financial reporting and BDO USA, LLP's audit of our internal control over financial reporting, review of financial statements included in our Form 10-Q quarterly reports, and services that are normally provided by the independent registered public accounting firm in connection with statutory and regulatory filings or engagements for those fiscal years. This category also includes advice on accounting matters that arose during, or as a result of, the audit or the review of interim financial statements and the preparation of an annual “management letter” on internal control matters.
(2)Audit related fees consist of fees paid in fiscal year 2011 for a 401(k) plan audit.
(3)Tax fees consist of fees paid in fiscal years 2012 and 2011 to a BDO USA LLP International firm for tax compliance services in Japan. Tax fees in fiscal year 2011 also consist of fees paid to BDO USA LLP for tax compliance and tax preparation plus tax services relating to our global restructuring project which was completed in May 2011.

Tax Fees

        This category consists of professional services rendered primarily in connection with computation of our tax provision as well as tax compliance activities, including the preparation of tax returns in certain overseas jurisdictions and technical tax advice related to the preparation of tax returns.

Pre-Approval Policies and

Approval Procedures

The Audit Committee, inat its sole discretion, pre-approved and reviewed audit and non-audit services performed by our independent registered public accounting firm, as well as the fees charged for such services. Requests for approval are considered at each regularly scheduled Audit Committee meeting or, if necessary, are approved by the unanimous consent of all members of the Audit Committee. In its pre-approval and review of non-audit service fees, the Audit Committee considers, among other factors, the possible effect of the performance of such services on the auditors' independence. The Audit Committee considered and pre-approved all services rendered during fiscal years 20092012 and 2008.

2011.





Vote Required

        If a quorum is present, the

The approval of the ratification of the appointment of BDO Seidman,USA, LLP as our independent registered public accounting firm for the fiscal year ending September 30, 20102013, will require the affirmative vote of a majority of the shares votingof Common Stock present or represented and entitled to vote at the Annual Meeting.Meeting with respect to such proposal.  See "Information“Information Concerning Solicitation and Voting—Quorum; Abstentions;Quorum, Abstentions, Broker Non-Votes."

Non-Votes, Required Votes.”

THE AUDIT COMMITTEEBOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERSA VOTE "FOR" THE“FOR” RATIFICATION OF THE APPOINTMENTSELECTION OF BDO SEIDMAN,USA, LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 2010.

FIRM.




SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Security Ownership of Certain Beneficial Owners and Management

The following table sets forth certainpresents information regarding the beneficial ownership of shares of our common stock based on 404,841,802 shares of common stock outstanding as of March 26, 2010 by: (i) all thoseCommon Stock with respect to:
Each person who is known byto us to be the beneficial ownersowner of more than five percent of the outstanding shares(5%) of our common stock; (ii) eachoutstanding Common Stock;
Each of our executive officers named in the Summary Compensation Table; (iii) eachdirectors and nominees;
Each of our current directors;named executive officers; and (iv) all
All of our currentdirectors and executive officers and directors as a group. Five percent or greater shareholder
This information is basedas of January 11, 2013, except for information on information containedgreater than five percent (5%) stockholders.  Amounts reported under “Number of Shares of Common Stock Beneficially Owned” include the number of shares subject to stock options and RSUs that become exercisable or vest, and the number of shares that can be acquired upon conversion of Series B convertible preferred stock and debentures, within 60 days of January 11, 2013 (which shares are shown in Schedule 13D/13G filings.the columns to the right).  Unless otherwise indicated, the persons named in this table have sole voting and sole investment power with respect to all shares shown as beneficially owned, subject to community property laws where applicable. Unless otherwise indicated, the address of each of the beneficial ownersperson listed in this table is:is c/o Vitesse Semiconductor Corporation, 741 Calle Plano, Camarillo, California 93012.

Name of Individuals or Identity of Group
 Shares
Beneficially
Owned		 Shares
Exercisable
Within 60
Days of
March 26,
2010		 Total Shares
Beneficially
Owned Plus
Exercisable
Within 60
Days of
March 26,
2010		 Additional
Shares
Exercisable
Within 60 Days
of March 26,
2010 and upon
the Company's
Listing on an
Exchange		 Percent of
Total
Shares
Outstanding		 

AQR Capital Management, LLC; AQR

  33,677,288(1) 7,329,630  41,006,918  —  9.9%
 

Absolute Return Master Account L.P.

                
 

Two Greenwich Plaza, 3rd Floor

                
 

Greenwich, CT 06830

                

CNH CA Master Account, L.P. 

  
39,980,338
(2)		 
403,798		  
40,384,136		  
—		  
9.9
%
 

Two Greenwich Plaza, 3rd Floor

                
 

Greenwich, CT 06830

                

Linden Capital, L.P. 

  
12,471,723
(3)		 
30,934,598		  
43,406,321		  
—		  
9.9
%
 

c/o Wakefield Quin

                
 

Victoria Place

                
 

31 Victoria Street

                
 

Hamilton HM10, Bermuda

                

Whitebox Advisors, LLC

  
40,712,026
(4)		    
40,712,026		  
—		  
9.9
%
 

3033 Excelsior Boulevard, Suite 300

                
 

Minneapolis, MN 55416

                

Aristeia Master, L.P. 

  
30,811.017
(5)		 
—		  
30,811,017		  
—		  
7.6
%
 

136 Madison Avenue, 3rd Floor

                
 

New York, NY 10016

                

ABN AMRO Bank N.V.,

  
26,726,116
(6)		 
—		  
26,726,116		  
—		  
6.6
%
 

London Branch

                
 

c/o RBS Global Banking & Markets

                
 

600 Washington Boulevard

                
 

Stamford, CT 06901

                

Kopp Investment Advisors, LLC

  
21,138,676
(7)		 
—		  
21,138,676		  
—		  
5.2
%
 

7701 France Avenue South,

                
 

Suite 500

                
 

Edina, MN 55435

                

Lake Union Capital Fund, L.P. 

  
20,210,000
(8)		    
20,210000		     
5.0
%
 

600 University Street, Suite 1520

                
 

Seattle, WA 98101

                

Christopher R. Gardner

  
399,316		  
1,677,885		  
2,077,021		  
300,000
(9)		 
*		 

Richard C. Yonker

  
—		  
225,000		  
225,000		  
150,000
(10)		 
*		 

Dr. Martin C. Nuss

  
—		  
100,000		  
100,000		  
75,000
(11)		 
*		 

Steven P. Hanson

  
—		  
49,500		  
49,500		  
40,000
(12)		 
*		 
  
Number of Shares
of Common Stock
Beneficially
Owned (1)
 
Percent
of Class
 
Number of
Shares Subject
to Options
Exercisable
Within 60 Days
 
Number of
Shares Subject
to RSUs That
Vest Within
60 Days
 
Number of Shares
Subject to Series B
Preferred Stock and
Debentures Convertible
Within 60 Days (2)
Directors, Nominees and Named Executive Officers:          
Mathew Frey —
 *
 —
 —
 —
Christopher R. Gardner 403,564
 1.1% 196,800
 30,000
 —
Steven P. Hanson 58,214
 *
 7,750
 —
 —
James H. Hugar 66,400
 *
 5,750
 —
 —
Scot B. Jarvis 28,571
 *
 —
 —
 —
G. William LaRosa 57,552
 *
 —
 —
 —
G. Grant Lyon 72,400
 *
 5,750
 —
 —
Martin S. McDermut 117,916
 *
 52,083
 4,167
 —
Dr. Martin C. Nuss 93,339
 *
 47,400
 6,666
 —
Edward Rogas, Jr. 65,650
 *
 6,000
 —
 —
Kenneth H. Traub —
 *
 —
 —
 —
Directors and officers as a Group (11 persons) 963,606
 2.6% 321,533
 40,833
 —
Greater Than 5% Stockholders:          
CNH CA Master Account, L.P.(3) 2,476,333
 6.3% —
 —
 2,476,333
Whitebox Advisors, LLC (4) 2,690,690
 6.9% —
 —
 1,887,234
Kopp Investment Advisors, LLC (5) 2,567,418
 7.0% —
 —
 —
AQR Capital Management, LLC (6) 2,315,899
 6.0% —
 —
 2,018,999
Columbia Pacific Opportunity Fund, L.P. (7) 2,744,128
 7.4% —
 —
 —
Raging Capital Master Fund, Ltd. (8) 6,491,127
 17.6% —
 —
 —

Name of Individuals or Identity of Group
 Shares
Beneficially
Owned		 Shares
Exercisable
Within 60
Days of
March 26,
2010		 Total Shares
Beneficially
Owned Plus
Exercisable
Within 60
Days of
March 26,
2010		 Additional
Shares
Exercisable
Within 60 Days
of March 26,
2010 and upon
the Company's
Listing on an
Exchange		 Percent of
Total
Shares
Outstanding		 

Edward Rogas, Jr. 

  —  40,000  40,000  40,000(12) * 

G. Grant Lyon

  
—		  
—		  
—		  
—		  
*		 

James H. Hugar

  
—		  
—		  
—		  
—		  
*		 

All executive officers and Directors as a group (7 persons)

  
399,316		  
2,092,385		  
2,491,701		  
605,000		  
*		 

Former Executive Officers:

                

Michael B. Green(13)

  
—		  
—		  
—		  
—		  
—		 
*
Less than 1% of the outstanding Common Stock..
(1)Beneficial ownership is determined in accordance with the rules of the SEC that deem shares to be beneficially owned by any person who has or shares voting or investment power with respect to such shares. Shares of Common Stock that presently, or within 60 days of the date of this information, may be acquired by a holder upon exercise of warrants or options or conversion of preferred stock or convertible debt, or that vest under restricted stock units, are deemed outstanding for purposes of computing the percentage ownership of the person holding such securities, but are not deemed outstanding for computing the percentage ownership of any other person. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person's actual ownership or voting power with respect to the number of shares of Common Stock actually outstanding at January 11, 2013.
(2)Pursuant to the terms of Series B convertible preferred stock and convertible debentures held by certain of our stockholders, the maximum number of shares that may be acquired by any such stockholder upon conversion of the Series B convertible preferred stock or convertible debentures is limited to the extent necessary to ensure that, following such exercise, the total number of shares of Common Stock then beneficially owned by such stockholder and its affiliates and any other persons whose beneficial ownership of Common Stock would be aggregated with the stockholder for purposes of Section 13(d) of the Exchange Act, does not exceed 9.99% of the total number of issued and outstanding shares of Common Stock then outstanding. The shares of Common Stock and percentage ownership listed in this table reflect these contractual limitations on a stockholder's ability to acquire shares of Common Stock upon conversion of its Series B convertible preferred stock or convertible debentures.


(1)
A Schedule 13G/A was filed on February 11, 2010 by AQR Capital Management, LLC and its affiliates which together beneficially own an aggregate of 33,677,288 shares of common stock and debt securities that are convertible into 7,329,630 shares of common stock.

(2)
CNH CA Master Account, L.P. and its affiliates beneficially own an aggregate of 134,718.93 shares of Series B Preferred Stock that are convertible into an aggregate of 13,471,893 shares of common stock and $10,689,000 aggregate principal amount of debt securities that are convertible into an aggregate of 47,506,666 shares of common stock. The shares of Series B Preferred Stock and the Debt securities are convertible into shares of common stock but only to the extent that conversion would not cause the holder to become a beneficial owner of more than 9.99% of the shares of common stock outstanding.

(3)
A Schedule 13G/A was filed by Linden Capital, L.P. ("Linden Capital"), Linden GP LLC ("Linden GP") and Siu Min Wong with the SEC on January 15, 2010. Linden GP is the general partner of Linden Capital and Mr. Wong is the managing member of Linden GP. Therefore, Linden GP and Mr. Wong may each be deemed to beneficially own the shares of common stock owned by Linden Capital. Linden Capital, Linden GP and Mr. Wong have shared power to vote or direct the vote and to dispose or direct the disposition of the shares held by Linden Capital. The shares exercisable within 60 days include shares of common stock issuable upon conversion of the 187,503.01 shares of Series B Preferred Stock and $6,150,000 principal amount of debt securities held by Linden Capital. The shares of Series B Preferred Stock and the debt securities are convertible into shares of common stock but only to the extent that conversion would not cause the holder to become a beneficial owner of more than 9.99% of the shares of common stock outstanding.

(4)
A Schedule 13G/A was filed on February 16, 2010 by Whitebox Advisors, LLC and its affiliates who, as of such date, together beneficially owned (i) an aggregate of 448,563.71 shares of Series B Preferred Stock that were convertible into an aggregate of 44,856,371 shares of common stock and (ii) $16,963,000 aggregate principal amount of debt securities that are convertible into an aggregate of 75,391,110 shares of common stock. The shares of Series B Preferred Stock and the debt securities are convertible into shares of common stock but only to the extent that conversion would not cause the holder to become a beneficial owner of more than 9.99% of the shares of common stock outstanding. The Schedule 13G/A does not identify the number of outstanding shares of common stock owned beneficially by Whitebox Advisors and its affiliates.

(5)
On February 16, 2010, a Schedule 13G was filed by Aristeia Capital LLC ("ACLLC") as the investment manager for the 30,810,017 shares held by Aristeria Master L.P., Aristeia International Limited and Aristeia Partners, L.P. (the "Aristeia Funds") for which it has shared voting and investment control. ACLLC and its affiliates disclaim beneficial ownership of the shares held by the Funds except to the extent of their respective economic interests in each Fund.

(6)
ABN AMRO Bank N.V., London Branch beneficially owns $5,345,000 aggregate principal amount of debt securities that are convertible into an aggregate of 23,755,556 shares of common stock. The debt securities are convertible into shares of common stock but only to the extent that conversion would not cause the holder to become a beneficial owner of more than 9.99% of the shares of common stock outstanding.

(7)
On January 22, 2010, a Schedule 13D/A was filed by Kopp Investment Advisors, LLC ("KIA"), Kopp Holding Company, LLC ("KHCLLC"), and LeRoy C. Kopp with the SEC. With respect to the shares reported on the Schedule 13D/A, KIA is an investment advisor managing discretionary accounts owned by numerous third-party clients, KHCLLC is a holding company, and the parent company of KIA, engaged in the investment industry, and Mr. Kopp is serving as the sole governor, chairman and chief investment officer of KIA and KHCLLC. As reported in the Schedule 13D/A, KIA has sole voting power with respect to 21,074,776 shares and shared dispositive power with respect to

(8)
On March 5, 2010, a Schedule 13G/A was filed by Lake Union Capital Fund, LP ("LULP"), Lake Union Capital Management, LLC ("LULLC"), and Michael Self with the SEC. As reported in the Schedule 13G, LULP, LULLC and Mr. Self have shared voting and dispositive power with respect to all 20,210,000 shares.


(9)
Represents vested restricted stock units and options as of March 26, 2010 or that will become vested within 60 days of March 26, 2010. Each restricted stock unit represents a right to receive one share of common stock. Of 200,000 restricted stock units granted on October 13, 2008, 50% vested on October 14, 2009, with the remainder vesting in two annual installments of 25% each on October 13, 2010 and October 13, 2011, respectively. Such vested options are not exercisable nor are the shares underlying restricted stock units deliverable until the Company's common stock is listed on a national security exchange.
(3)
As of January 11, 2013, CNH CA Master Account, L.P. and its affiliates beneficially own an aggregate of 20,200 shares of Series B Preferred Stock that are convertible into an aggregate of 101,000 shares of Common Stock and debt securities that are convertible into 2,375,333 shares of Common Stock. The mailing address for CNH CA Master Account, L.P. is Two Greenwich Plaza, 3rd Floor, Greenwich, CT 06830.
(4)As of January 11, 2013, based on information set forth in a Schedule 13G/A filed with the SEC on February 14, 2012, Whitebox Advisors, LLC beneficially owns 803,456 shares of our Common Stock, and own debt securities that are convertible into an aggregate of 1,887,234 shares of our Common Stock that are owned by clients for which Whitebox Advisors, LLC serves as investment adviser. The mailing address for Whitebox Advisors, LLC is 3033 Excelsior Boulevard, Suite 300, Minneapolis, MN 55416.
(5)As of January 11, 2013, based on information set forth in a Schedule 13D/A filed with the SEC on December 21, 2012 by Kopp Investment Advisors, LLC (“KIA”), Kopp Holding Company, LLC (“KHCLLC”), and LeRoy C. Kopp. KIA is an investment advisor managing discretionary accounts owned by numerous third-party clients, KHCLLC is a holding company, and the parent company of KIA, engaged in the investment industry, and Mr. Kopp is serving as the sole governor, chairman and chief investment officer of KIA and KHCLLC. As reported in the Schedule 13F, KIA beneficially owns 2,567,418 shares. The mailing address for Kopp Investment Advisors, LLC is 8400 Normandale Lake Blvd., Suite 1450, Bloomington, MN 55437.
(6)As of January 11, 2013, based on information set forth in a Schedule 13G/A filed with the SEC on February 8, 2012, AQR Capital Management, LLC, and AQR Absolute Return Master Account LP, collectively, beneficially own and report shared voting and dispositive power over 296,990 shares of our Common Stock, and own debt securities that are convertible into an aggregate of 2,018,909 shares of our Common Stock. The mailing address for AQR Capital Management, LLC and AQR Absolute Return Master Account L.P. is Two Greenwich Plaza, 3rd Floor Greenwich, CT 06830.
(7)As of January 11, 2013, based on information set forth in a Schedule 13G/A filed with the SEC on February 15, 2012, Columbia Pacific Opportunity Fund, L.P., Columbia Pacific Advisors, LLC (“CPA”), Alexander B. Washburn, Daniel R. Baty, Stanley L. Baty, and Brandon D. Baty, collectively, beneficially own and report sole voting and dispositive power over 2,744,128 shares of our Common Stock. The mailing address for Columbia Pacific Opportunity Fund, L.P. is 1910 Fairview Avenue East, Suite 500, Seattle, WA 98102.
(8)As of January 11, 2013, based on information set forth in a Schedule 13D/A filed with the SEC on January 4, 2013, Raging Capital Master Fund, Ltd, Raging Capital Management, LLC, and William C. Martin, collectively, beneficially own and report shared voting and dispositive power over 6,491,127 shares of our Common Stock, and own debt securities that are convertible into an aggregate of 1,442,666 shares of our Common Stock. The mailing address for Raging Capital Fund is Ten Princeton Avenue, Rocky Hill, NJ 08553.


(10)
Represents vested restricted stock units and options as of March 26, 2010 or that will become vested within 60 days of March 26, 2010. Each restricted stock unit represents a right to receive one share of common stock. Of 100,000 restricted stock units granted on October 13, 2008, 50% vested on October 14, 2009, with the remainder vesting in two annual installments of 25% each on October 13, 2010 and October 13, 2011, respectively. Such vested options are not exercisable nor are the shares underlying restricted stock units deliverable until the Company's common stock is listed on a national security exchange.

(11)
Represents vested restricted stock units and options as of March 26, 2010 or that will become vested within 60 days of March 26, 2010. Each restricted stock unit represents a right to receive one share of common stock. Of 50,000 restricted stock units granted on October 13, 2008, 50% vested on October 14, 2009, with the remainder vesting in two annual installments of 25% each on October 13, 2010 and October 13, 2011, respectively. Such vested options are not exercisable nor are the shares underlying restricted stock units deliverable until the Company's common stock is listed on a national security exchange.

(12)
Represents options vested as of March 26, 2010 or that become vested within 60 days of March 26, 2010. Such vested options are not exercisable nor are the shares underlying restricted stock units deliverable until the Company's common stock is listed on a national security exchange.

(13)
Mr. Green resigned from the Company effective as of February 5, 2010.

Section 16(a) Beneficial Ownership Reporting Compliance

        Section 16(a) of the Exchange Act requires our executive officers, directors, and persons who own beneficially more than 10 percent of a registered class of our equity securities to file reports of ownership and changes in ownership within specified periods with the SEC. To our knowledge, based solely on our review of the copies of Section 16(a) forms required to be furnished to us with respect to fiscal year 2009 and any written representations that no other reports were required, the Section 16(a) reporting requirements for reports required to be filed for fiscal year 2009 were met.



EXECUTIVE OFFICERS AND EXECUTIVE COMPENSATION

Executive Officers

Set forth below is information regarding our executive officers, other than Christopher R. Gardner, our President and Chief Executive Officer, for whom information is set forth above in Proposal One under "Nominees."

“Nominees' Principal Occupation, Business Experience and Qualifications.”

Richard C. YonkerMartin S. McDermut, age 62,61, was appointed our Chief Financial Officer on December 14, 2006.July 27, 2011. Prior to joining Vitesse, Mr. YonkerMcDermut provided chief financial officer and interim management advisory services since 2007. From January 2009 to July 2011, Mr. McDermut served as Managing Director of Avant Advisory Group, a financial advisory and management consulting firm to entrepreneurial and middle market companies. From May to November 2010, Mr. McDermut was the Interim Chief Financial Officer of Capella Photonics,IRIS International, Inc., a telecommunications company,publicly traded diagnostic medical equipment manufacturer. Prior to joining Avant Advisory Group, from October 20052007 to November 2006.December 2008, Mr. McDermut provided financial and management consulting services to various clients as principal of his own financial consulting firm. Prior to this role, his career included chief financial officer positions at publicly traded, entrepreneurial and early-stage companies. Mr. McDermut also worked for the certified public accounting and consulting firm Coopers & Lybrand L.L.P. (now known as PricewaterhouseCoopers LLP) where he was a partner and the practice leader of the firm's Los Angeles Entrepreneurial Advisory Services Group. Mr. McDermut is a Certified Public Accountant, Certified Merger & Acquisitions Advisor, Certified Insolvency and Restructuring Advisor, and Certified Fraud Specialist. He also served as Chief Financial Officer of Avanex Corporation, an optical telecommunications company, from April 2005 to September 2005; Actelis Networks, a telecommunications company, from May 2004 to April 2005; Bermai, a WiFi semiconductor company, from November 2003 to April 2004; Gluon Networks, a telecommunications switch company, from February 2003 to October 2003; and Agility Communications, a telecommunications company, from November 2000 to January 2003. Mr. Yonker served as a director of LogicVision, a semiconductor company providing built-in-self-test and diagnostic solutions, from January 2005 until the company merged with Mentor Graphics in August 2009. Mr. Yonker holds a bachelor'sBA degree in industrial engineeringeconomics from the General Motors InstituteUniversity of Southern California and a master'san MBA degree in finance managementand accounting from the Massachusetts InstituteUniversity of Technology.Chicago.


Dr. Martin C. Nuss, age 53,55, was appointed our Vice President of Technology and Strategy onin November 16, 2007. Prior to joining Vitesse, Dr. Nuss was most recentlyserved as Vice President and Chief Technology Officer of Ciena'sthe Optical Ethernet group.Group of Ciena provides leadingCorporation, a network infrastructure solutions and intelligent software. Prior to Ciena's acquisition of the companysoftware provider. Dr. Nuss founded Internet Photonics in 2004, he was founder2000, and served as its Chief Technology Officer of Internet Photonics since 2000. Heuntil the company was acquired by Ciena in 2004. Dr. Nuss also served 15 years at Bell Labs in various technical and management roles including Director of the Optical Data Networks Research Department. He is a Fellow of the Optical Society of America and a member of IEEE. Dr. Nuss holds a doctorate in applied physics from the Technical University in Munich, Germany.

Compensation Discussion and Analysis

Overview

        The Compensation Committee of the Board of Directors determines the overall executive compensation practices for our named executive officers. For fiscal year 2009, our named executive officers were: Christopher R. Gardner, Chief Executive Officer; Richard C. Yonker, Chief Financial Officer; Dr. Martin C. Nuss, Vice President, Technology and Strategy; and Michael B. Green, Vice President, General Counsel and Secretary. Mr. Green resigned from the Company effective as February 5, 2010.

        Executive compensation for our named executive officers consists of three components:


COMPENSATION DISCUSSION AND ANALYSIS
Compensation Philosophy and Objectives

        The basic

Vitesse's compensation philosophy of the Compensation Committee is to pay our executive officers a reasonable and competitive base salary, and to reward named executive officers fortheir achievements during the previous fiscal year, and to incentivize their performance in future years. ItsOur overall compensation goal is to establish and administer an executive compensation program that effectively attracts and retains highly skilledhighly-skilled executive officers, enhances shareholderstockholder value, motivates technological innovation, and rewards executive officers who contribute to the Company's long-term success.

We attempt to achieve these objectives by offering a compensation program comprised of base salary, annual cash incentive awards and equity-based compensation. We use all three components of compensation in an effort to create a balanced compensation package that provides adequate incentives for outstanding performance without creating undue incentives for excessive risk taking by our executives.
Our executive compensation strategy is to provide compensation opportunities at the 50th to 75th percentiles of market, depending on the compensation component and assuming acceptable levels of performance achievement. Specifically, we:
•
Target base salary levels at the market 50th percentile in aggregate;
•
Provide target bonus opportunities to earn between the market 50th and 60th percentiles of total cash compensation (base salary plus annual cash bonus) for achieving key business objectives and results; and
•
Grant long-term incentives annually such that total direct compensation (total cash plus long-term incentive) is positioned at the market 50th percentile if performance objectives are achieved.
As part of our compensation strategy, we monitor our compensation mix relative to market. We generally design our compensation program with the intent of providing a compensation mix (i.e., distribution between elements) similar to the market.
Over the past several years, the compensation for our executive officers has been between the 25th and 50th percentiles of market, well below our objective of providing opportunities at the 50th to 75th percentiles of market. While we have focused on decreasing expenses to improve profitability, we have held base salaries constant at levels that now are generally near the 25th percentile of market, and have targeted bonus opportunities for many executive officers to more closely approximate between the 25th and 50th percentiles of market with the exception of the CEO whose target bonus opportunity is at the 75th percentile. While our overall compensation philosophy has not changed, the actual compensation opportunities for our executive officers has not kept pace with our market objectives. For fiscal year 2013, we expect this trend will continue with respect to target base salaries, which for the majority of our executive officers will remain around the 25th percentile of market, but that target bonus opportunities and total direct compensation will increase as we more heavily weight executive compensation on the achievement of performance objectives.
2012 “Say on Pay” Proposal Voting Results
We are required to hold an advisory vote on compensation practices for executive officers (commonly referred to as a “say on pay” proposal). Our stockholders voted on a “say on pay” proposal at our 2012 Annual Meeting of Stockholders, and we have included a “say on pay” proposal in this proxy statement (Proposal Three) for action at this year's Annual Meeting. Our Compensation Practices

        EachCommittee will consider the results of voting on our “say on pay” proposal as part of its evaluation of whether to make changes to our compensation programs to the extent necessary to align the programs with our compensation objectives and to address market-wide or company-specific concerns about our executive compensation program. Our stockholders overwhelmingly supported our executive compensation practices at the 2012 Annual Meeting of Stockholders, with 88.2% of the shares voting on the proposal voting in favor of the compensation of our executive officers.

Determining Executive Compensation
The Compensation Committee of our Board of Directors is primarily responsible for determining the annual salaries and other compensation of executive officers. The Compensation Committee has adopted a general approach of compensating executives with cash salaries commensurate with the experience and expertise of the executive and competitive with median salaries paid to executives at comparable companies. To reward executives for their contributions to the achievement of Company-wide performance goals, incentive target bonus awards are established at a level designed to ensure that when such payouts are added to the executive's base salary, the target total compensation for meeting performance expectations will be near the median at comparable companies (with above-median compensation opportunities for exceeding performance goals).



In addition, to align our executives' compensation with our business strategies, values and management initiatives, both short- and long-term, executive officers are provided with long-term performance incentives.
We also consider the compensation levels of executive officers at other publicly traded companies. We have collected information regarding compensation levels at other companies over the last several years from a variety of sources, including proxy statements, compensation reports and surveys published or prepared by compensation consulting firms. Using this information, we generally establish compensation levels (including salary, cash bonus and equity-based compensation) comparable to the median compensation levels of our counterparts at comparable companies.
The Chief Executive Officer makes compensation recommendations for named executive officers (other than the Chief Executive Officer) and other senior executives. He actively participates in the annual executive compensation assessment (other than for the Chief Executive Officer position). In developing his recommendations, the Chief Executive Officer takes into account a number of factors, including individual performance and contribution level, current compensation relative to market, past awards, compensation level relative to internal peer positions, and internal compensation expense budgets. The Chief Executive Officer does not attend executive sessions of our Board or meetings where his own compensation is being determined.
The independent directors of our Board conduct a formal performance review of the named executive officers, including the Chief Executive Officer, which includes an assessment of financial and non-financial accomplishments. At the beginning of each fiscal year, the Chief Executive Officer develops management performance objectives for the named executive officers (other than the Chief Executive Officer) and assigns weights to each objective which vary differently from year-to-year depending on our priorities. These objectives are then submitted to the independent directors of our Board for review. At the conclusion of each fiscal year, the Chief Executive Office and the independent directors then evaluate the named executive officers' (other than the Chief Executive Officer) actual performance against the pre-established objectives to determine compensation awards for the named executive officers.
Should a restatement of earnings occur upon which incentive compensation awards were based, the Compensation Committee has the discretion to take necessary actions to protect the interests of stockholders, including actions to recover such awards. Additionally, each of Messrs. Gardner's and McDermut's employment agreement requires such executive to return to us any bonus payments if we are required to prepare an accounting restatement to correct an accounting error on an interim or annual financial statement due to material noncompliance with any financial reporting requirement under the federal securities laws, if our Board determines that misconduct by the executive occurred and caused such restatement. The executive would be required to disgorge any bonus or other incentive-based or equity-based compensation he received from us during the 12-month period following the first public issuance or filing with the SEC (whichever first occurs) of the financial document embodying such error, and any net profits realized by the executive from the sale of our stock during that 12-month period.
The Compensation Committee has the authority to engage the services of one or more independent compensation consultants to provide advice on executive compensation matters. The Compensation Committee has the discretion to hire and fire the compensation consultant, as described in the Compensation Committee's charter. The Compensation Committee determines the amountsscope of each named executive officer's base salary, annual cash bonus,the consultant's engagement and equity grants.compensation for the consultant's services. The compensation consultant may not provide any services to Vitesse other than advice on compensation matters, and works with management only at the request and subject to the oversight of the Compensation CommitteeCommittee. Management reviews industry data as described below to gain an understandingconsultant invoices, and approves and remits payment in accordance with the terms of compensation levels within the industry for each executive position.

        The Compensation Committee previously reviewed the Radford Executive Survey to obtain industry data. Starting inengagement.

During fiscal year 2009,2012, the Compensation Committee contracted with DolmatConnell,engaged independent compensation consultants,consultant Radford, an Aon Hewitt Company, to assess its competitors'conduct a detailed assessment of our compensation programs for executive officers, including our Chief Executive Officer. Radford compared the compensation levels for base salary, annual cash bonus and equity awards.


of our executive officers to a peer group of publicly traded companies. The Compensation Committee considers industry compensation data because it wishespeer group selection criteria used by Radford consisted of firms that have similar products and/or services to provide compensation packages that are neitherours with revenues between approximately one-half to two times Vitesse's revenues at the low nor high endstime they were selected and market capitalizations of less than $300 million. Of the nineteen peer group companies ultimately selected, all of the range of comparable companies but, instead, are targeted toward the mid-pointmet at least one of the rangerevenue and market capitalization selection criteria, and fourteen companies met both criteria. For those companies that did not meet both criteria, we nevertheless concluded that each company was a reasonable comparable in terms of comparable companies. Overall, the Company's compensationbusiness model and because we compete with it for fiscal year 2009 for its named executive officers is competitive with the market. While base salaries slightly lagged the market by approximately fivetalent in some of our business markets.

Based on these objective criteria and other subjective considerations, which were intended to 15 percent, bonus targets bring total cash compensationrecognize pay practices related to the 50th percentile for comparable companies. Equity or long-term incentive compensation for fiscal year 2009 for named executives is in line with or slightly below the 50th percentile for comparable companies. The Compensation Committee's determinations regarding individual compensation elements are based on several factors beyondboth Vitesse's industry data, including, but not limited to, the criticality of the position, individual performance and company performance. After reviewing industry data and assessing the role and performance of each named executive officer,size, the Compensation Committee uses its discretion to set compensation levels for each ofselected the three components for the named executive officers.

Consideration of Competitors' Compensation

        The Compensation Committee selected independent compensation consultants, DolmatConnell, to conduct afollowing nineteen peer group compensation survey. DolmatConnell provides pay data of semiconductor companies includingtaking into account input from management and the majority of our competitors.

        DolmatConnell's October 28, 2008 study benchmarked Vitesse's executive compensation and long-term incentives against 19 peer firms:

recommendation from Radford:




Actel CorporationMagma Design Automation, Inc.
Anadigics, Inc.Mindspeed Technologies, Inc.
Applied Digital Solutions, Inc.MIPS Technologies, Inc.
Applied Micro Circuits CorporationNanometrics,Mindspeed Technologies, Inc.
Cirrus Logic,Cascade Microtech, Inc.MIPS Technologies, Inc.
EMCORE CorporationOplink Communications, Inc.
DSP Group, Inc.Exar CorporationPericom Semiconductor Corporation
Emcore CorporationFormFactor, Inc.PLX Technology, Inc.
GSI Technology, Inc.Sigma Designs, Inc.
Entropic Communications, Inc.Silicon Image, Inc.
Ikanos Communications, Inc.Sirf Technology Holdings,Supertex, Inc.
IXYSIntegrated Silicon Solution, Inc.Symmetricom, Inc.
LTX-Credence CorporationTranSwitch Corporation
Mattson Technology, Inc. 

        DolmatConnell reviewed

While the potentialfirms included in our peer landscape by assessing direct product competitors listed in Hoover's database, companies that listed Vitesse in their peer groups, local labor market companies and firms in Vitesse's related industries as referenced in Hoover's database. The resulting peer group of 19 companies was then selected using the following criteria:

        The peer group used in the compensation survey is representative of the market for executive talent in which Vitesse competes, although some of these firms may not be in direct competition with Vitesse. Vitesse, we believe that our peer group is representative of our market for executive talent. Compensation benchmarking for our executive officers included information published in the peer group's most recent proxy statements and the 2012 Radford Global Technology Survey data.

The list also differspeer group selected by the Compensation Committee is different from the previous Radford Executive Survey, as methodologypeer group selected by the Compensation Committee in fiscal year 2010, when the committee last selected a peer group of companies for compensation benchmarking. The differences were to remove seven companies due to acquisition and criteria were altered to reflect company sizecurrent revenues and market capitalization.


capitalizations falling outside of our objective criteria. Ten companies were added to the group based on meeting the objective industry and size criteria and for other subjective considerations.

Compensation Elements
Our compensation package for executive officers consists of base salary, annual cash incentive (bonus) awards and long-term equity-based compensation. The Roleexecutive officers are also eligible to participate in all of Managementour employee benefit plans.
Base Salaries. We provide competitive base salaries to pay for day-to-day service in Setting Executive Compensationposition that reflect an individual's duties and responsibilities, experience, expertise, and individual performance. The salaries are generally set to approximate the 50

        Compensationth percentile market levels for the positions at each level, although there may be variations by individual to recognize the importance of the position or the experience of the individual.

Individual salary levels are determined based on assessments of:
Internal job responsibilities;
Experience in role; and
Market levels for comparable positions.
Salary increases are determined based on an assessment of individual performance in the role and relative to individual objectives established for the year.
We did not increase base salaries for our named executive officers during fiscal years 2011 or 2012. In November 2012, the Compensation Committee evaluated the base salaries of our named executive officers and compared them against our targeted philosophy of base salaries at the market 50th percentile. The Compensation Committee determined that Mr. Gardner's base salary was below the market 25th percentile, Mr. McDermut's base salary was at the market 50th percentile, and Dr. Nuss's base salary was near the market 25th percentile. With respect to Mr. Gardner, the Compensation Committee decided to consider any increase in base salary as part of the negotiation of a new employment agreement with Mr. Gardner, whose existing employment agreement expires in February 2013. With respect to all other than ournamed executive officers, the Compensation Committee decided not to increase base salaries in favor of providing these officers with a greater cash bonus opportunity for fiscal year 2013. Annual base salaries for fiscal years 2010, 2011 and 2012 for the named executive officers are as follows:



  Fiscal Year 2010 Fiscal Year 2011 Fiscal Year 2012
Executive Annual Base Salary Annual Base Salary Annual Base Salary
Christopher R. Gardner $366,667
 $375,000
 $375,000
Martin S. McDermut (1)  —
 285,000
 285,000
Martin C. Nuss 226,250
 235,000
 235,000
Steve Perna (2) 235,000
 235,000
 235,000

(1)Mr. McDermut’s employment with Vitesse commenced in July 2011.
(2)Mr. Perna’s employment with Vitesse terminated in May 2012.
Annual Cash Bonus. We provide eligible employees, including the Chief Executive Officer Christopher R. Gardner, is established byand other named executive officers, the Compensation Committeeopportunity to earn annual cash awards upon the recommendation of Mr. Gardner. With regard toachieving pre-determined performance goals and objectives and, for our named executive officers other than the Chief Executive Officer, Mr. Gardner recommends individualVitesse achieving a minimum level of financial performance for the fiscal year, typically determined by reference to the Company's Adjusted EBITDA for the year. The purpose is to reward attainment of Company financial goals and presents toindividual performance objectives, with threshold, target and maximum award opportunities expressed as a percentage of base salary. Target bonuses generally vary by executive level and are set at levels that, when combined with base salaries, will deliver market 50th percentile levels of total cash compensation if financial and performance objectives are met and above the Compensation Committee his subjective evaluation50th percentile levels if targets are exceeded.
The following are our fiscal year 2012 threshold, target and maximum annual cash bonus opportunities as a percentage of the otherbase salary for our named executive officers in executive sessions. After considerationassuming 100% of Mr. Gardner's presentation, the ultimate decision astheir individual performance objectives are achieved:
Executive Threshold Target Maximum
Christopher R. Gardner 50% 100% 150%
Martin S. McDermut 30% 40% 60%
Martin C. Nuss 20% 30% 50%
Steve Perna 20% 30% 50%
We select different financial performance metrics and individual performance objectives to compensationreward performance and to be paid to those named executive officers is mademotivate desired behaviors. Performance weightings vary by the Compensation Committee.

        The Compensation Committee is solely responsible for setting compensationexecutive. For fiscal year 2012, weightings for the Chief Executive Officer including establishingwere 80% on achieving specific Company-wide financial metrics and 20% on execution of strategic goals for Vitesse. For the Chief Financial Officer, the fiscal year 2012 performance objectives were 60% on achieving company-wide financial metrics and 40% on goals specific to the finance department and Vitesse's financial liquidity and capital resources. For other named executive officers, the performance objectives are generally weighted 40% to 80% on goals related to new products and revenue growth and 20% to 60% on goals specific to the executive's department or principal responsibilities.

The rationale for the mix of financial and strategic objectives is to recognize that Vitesse must improve its short-term financial performance while at the same time invests in new products and organizational improvements that will lead to long-term revenue growth and financial stability. Vitesse considers both revenue and gross margins in the portion of the bonus plan that is focused on financial performance because Vitesse believes top line growth and profitable operations are both equally necessary to support and increase the stock price for investors. Additionally, Vitesse includes cash in the bonus plan for our Chief Executive Officer and Chief Financial Officer in recognition of the need to build cash balances to pay down our substantial indebtedness that matures in 2014. At the conclusion of each fiscal year, the Compensation Committee evaluates the named executive officers' actual performance against the pre-established objectives to determine compensation awards for the named executive officers. If minimum thresholds are not achieved, no cash incentive is paid under the plan.
The bonus payments, if any, for a fiscal year are paid by the end of the first quarter of the following fiscal year, or as soon as practicable after determination and certification of the actual financial performance levels for the year and grant of approval by the Compensation Committee in a duly held meeting, but, in no event, later than March 15 of the following fiscal year.
Chief Executive Officer. The bonus payment to our Chief Executive Officer is determined at the discretion of the Compensation Committee after assessing Vitesse's financial performance and reviewing Mr. Gardner's achievement of individual performance objectives. Mr. Gardner's fiscal year 2012 financial goals and evaluating performance.individual performance objectives, as well as the portion of Mr. Gardner's potential bonus payment related to each performance metric, were determined in December



2011 and are summarized in the following table. Mr. Gardner does not participate in anyis able to achieve between zero percent and 150% of each financial goal and individual performance metric, with achievement below a minimum threshold of 50% assigned a zero percent. Based on the Compensation Committee decisions regardingCommittee's evaluation of Mr. Gardner's performance relative to his own compensation.

Fiscal Year 2009 Compensation Practices

        Thefinancial and individual performance metrics, the Compensation Committee determined bonusesthat Mr. Gardner achieved an overall bonus payment percentage of 80% of his potential bonus payment for executivesfiscal year 2012, as follows:

Performance Metric 
Weighting of Each
Metric as a
Percentage of
Total Potential
Bonus Payment
 
Percentage
Achievement of
Performance
Metric (Between
0% and 150%)
 
Bonus Payment
as a Percentage
of Potential
Bonus Payment
Financial Performance Metrics:  
  
  
Revenue from Operations 20% 0% 0%
Gross Margin 20% 150% 30%
Operating expenses 20% 150% 30%
Cash 10% 100% 10%
EBITDA 10% 0% 0%
Execution of Board Approved Goals 20% 50% 10%
Total: 100%  
 80%
The substantial majority of Mr. Gardner's individual performance objectives were defined in advance by reference to quantified goals and specific achievement dates, and thus, the Compensation Committee was able to evaluate Mr. Gardner's actual performance against objectives without substantial subjective analysis. Mr. Gardner did not achieve his financial performance objective for revenue from operations and EBITDA, as these metrics were below minimum thresholds. Mr. Gardner did exceed the maximum achievement criteria for gross margin and operating expenses, earning him 150% of these objectives' bonus weightings, and the target achievement for the Company's cash position, earning him 100% of this objective's bonus weighting. With respect to Board approved goals, they were strategic projects that supported our fiscal year based on 1)2012 annual plan.
While Mr. Gardner achieved an overall bonus goals percentage of 80%, Vitesse did not achieve the Company's attainmentminimum level of specific financial performance objectivesAdjusted EBITDA for the fiscal year and 2)2012 that was a condition to the executive's achievementpayout of personal goals, including the successful restructuring of the Company's debt inany bonus to our Chief Executive Officer. Accordingly, Mr. Gardner did not receive a cash bonus for fiscal year 2009.

        For2012. The named executive officers, including Mr. Gardner, did receive a discretionary bonus for fiscal year 2012, as discussed in greater detail below.

Other Named Executive Officers. Named executive officers other than Mr. Gardner theparticipate in our Executive Bonus Plan, under which their bonus amount ispayments are based partially on Vitesse's Adjusted EBITDA and partially on achievement of personal goals, according to the Company achieving a minimum Adjusted EBITDA. following formula:
Total
Bonus
=
Base
Salary
X
% of Total Bonus with 100% of Goals Achieved
for the respective Adjusted EBITDA
X
% of Personal
Goals Achieved
Adjusted EBITDA is calculated as net income before interest, expenses for taxes, depreciation, amortization, deferred stock compensation, gain or loss on the embedded derivative , and non-recurring professional fees, with the possibility of adjustment for certain unusual or non-recurring events. The Company under-performed itstable below shows the fiscal year 2012 Adjusted EBITDA goals (expressed as a percentage of our target Adjusted EBITDA for the fiscal year) and minimum, target and maximum bonus payments for each level of Adjusted EBITDA assuming achievement of all personal performance goals (expressed as a percentage of annual base salary).



 Adjusted EBITDA 
Total Bonus with
100% of Goals
Achieved for
CFO
 
Total Bonus with
100% of Goals
Achieved for Other
Named Executive
Officers (other than
the CEO and CFO)
Below MinimumLess than 62.5% of Target 0% 0%
Minimum62.5% of Target 30% 20.0%
Target100% of Target 40% 30.0%
 More than 112.5% of Target 50% 40.0%
MaximumMore than 125% of Target 60% 50.0%
For fiscal year 2012, Vitesse achieved an Adjusted EBITDA that was below the minimum level of Adjusted EBITDA for the payment of bonuses under the plan. As a result, none of the named executive officers participating in the Executive Bonus Plan received a cash bonus for fiscal year 2009 and thus this element was rated with zero weight for these officers in 2009. The Company requested, and2012 under the SEC granted, confidential treatment of the EBITDA goals in the Company's 2009 Executive Bonus Plan, irrespective of the percentage of personal goals achieved by the named executive officer. Mr. Perna was not employed by us at fiscal year-end, and thus not eligible for an annual bonus for 2012. The named executive officers did receive a discretionary bonus for fiscal year 2012, as discussed in greater detail below.
The individual performance goals for each of the named executive officers other than our Chief Executive Officer for the fiscal year 2012 Executive Bonus Plan were initially established by Mr. Gardner at the beginning of fiscal year 2012. Following fiscal year-end 2012, Mr. Gardner made both qualitative and subjective determination regarding the extent to which Messrs. McDermut and Nuss met their individual performance goals. Mr. Gardner did not evaluate Mr. Perna's performance, as he was not employed at fiscal year-end.
The financial goals and individual performance objectives for each of Messrs. McDermut, Nuss and Perna, as well as the portion of each named executive officer's potential bonus payment related to each performance metric are summarized in the following tables. Additionally, for Messrs. McDermut and Nuss, the CEO's determination to what extent each metric was achieved is also presented. Each named executive officer is able to achieve between zero percent and 100% of each individual performance metric, with achievement below a minimum threshold of 50% assigned a zero percent.
Martin S. McDermut
Performance MetricWeighting of Each Metric as a Percentage of Total Potential Bonus Payment Percentage Achievement of Performance Metric (Between 0% and 100%) Bonus Payment as a Percentage of Potential Bonus Payment
Financial Performance Metrics:     
Cash20% 100% 20%
Gross Margin20% 100% 20%
Operating expenses20% 100% 20%
Provide Accurate Budgets10% 100% 10%
Improve Financial Report10% 100% 10%
Refinance Debt20% 0% 0%
Total:100%   80%
The majority of Mr. McDermut's individual performance objectives (80%) were defined in advance by reference to quantified goals and specific achievement dates, and thus, Mr. Gardner and the Compensation Committee were able to evaluate Mr. McDermut's actual performance against objectives without substantial subjective analysis. Mr. McDermut achieved his maximum achievement percentage for all three of his financial performance metrics (cash, gross margin and operating expenses), earning him 100% of these objectives' bonus weightings. Mr. McDermut also achieved his maximum achievement percentage for improving the organization's internal financial reporting, which was more comprehensive and timely during fiscal year 2012 than in prior years, and for improving the accuracy of the Company's internal budgets. We did not resolve the first phase of debt resolution in 2012, and thus Mr. McDermut did not achieve this performance objective. For fiscal year 2012, Vitesse achieved an Adjusted EBITDA that was below the minimum level of Adjusted EBITDA for the payment of bonuses under the plan. As a result, Mr. McDermut did not receive a cash bonus for fiscal year 2012 under the Executive Bonus Plan.



Martin C. Nuss
Performance MetricWeighting of Each Metric as a Percentage of Total Potential Bonus Payment Percentage Achievement of Performance Metric (Between 0% and 100%) Bonus Payment as a Percentage of Potential Bonus Payment
Customer Penetration20% 75% 15%
IP Edge Design Wins20% 50% 10%
Establish Leadership in Network Timing20% 75% 15%
Exploit Changes in Network Architecture20% 100% 20%
Strengthening the Organization20% 75% 15%
Total:100%   75%
The substantial majority of Dr. Nuss' individual performance objectives were defined in advance by reference to quantified goals and specific achievement dates, and thus, Mr. Gardner and the Compensation Committee were able to evaluate Dr. Nuss' actual performance against objectives using both qualitative and subjective analysis. Dr. Nuss achieved his target achievement for customer penetration, where his efforts were focused on increasing business with our top customers and prospects specifically within the IP Edge market. He also realized his target achievement for establishing Vitesse's leadership in network timing, with the success of VeriTime™, and in strengthening the organization by aligning efforts within multiple departments to determine next-generation roadmaps and technologies. Dr. Nuss achieved the maximum achievement criteria for exploiting disruptions in network architecture to identify new product opportunities. Dr. Nuss achieved the minimum criteria for IP Edge design wins, which was measured by the total number of design wins that he served an instrumental role in securing during fiscal year 2012. For fiscal year 2012, Vitesse achieved an Adjusted EBITDA that was below the minimum level of Adjusted EBITDA for the payment of bonuses under the plan. As a result, Mr. Nuss did not receive a cash bonus for fiscal year 2012 under the Executive Bonus Plan.

Steve Perna
Performance MetricWeighting of Each Metric as a Percentage of Total Potential Bonus Payment
Revenue in Asia15%
Revenue from New Products15%
Revenue from IP Licensing10%
Execution of Mobile Access Strategy15%
Increasing Market Share for Select Products15%
Strengthening the Marketing Department15%
Improving Marketing Processes15%
Total:100%
Mr. Perna's employment with Vitesse terminated in May 2012, and consequently he was not eligible for a fiscal year 2012 annual bonus.
Fiscal Year 2012 Discretionary Bonus
The Compensation Committee awarded each of our named executive officers a discretionary bonus for fiscal year 2012, in recognition of the executives' service to Vitesse during a very difficult year for communications semiconductor companies. We have conditioned the payment of annual cash bonuses to our named executive officers on Vitesse's achievement of a minimum level of Adjusted EBITDA for the applicable fiscal year, in recognition of the importance of Vitesse delivering a minimum level of financial performance for our stockholders before rewarding management with cash bonuses, irrespective of the manager's individual performance for the year. The minimum level of financial performance, which for fiscal year 2012 was measured based on potential competitive injury toAdjusted EBITDA, is fixed at the Company if such information were disclosed.beginning of the fiscal year based on our Board-approved annual operating plan. The EBITDA goals were established at multiple tiers of difficulty, with lower payouts at moderate 'plan' performance levelsannual operating plan includes assumptions made by management and higher payouts at higher 'stretch' performance levels. EBITDA goals were also usedour Board about Vitesse's company-specific operations, as well as assumptions about Vitesse's customers and the semiconductor industry as a financial measurewhole. For fiscal year 2012,



the annual operating plan assumed improvements in the semiconductor industry and growth in spending on products that include the Company's component products, which did not materialize. Rather, the industry experienced further declines over what was already poor market the prior year. Consequently, the Compensation Committee concluded that the Company's failure to achieve the minimum level of Adjusted EBITDA for fiscal year 2012 was substantially outside of management's control, and the Committee determined to award the named executive officers discretionary bonuses based on an evaluation of the Company's performance in fiscal year 2008.

        Because2012 as compared to the minimum Adjusted EBITDA goal wasperformance of similarly situated semiconductor companies.

In deciding to award discretionary bonuses, the Compensation Committee also considered that the Company had not met,awarded cash bonuses to the maximum bonus under the formal 2009 Executive Bonus Plan for personal performance was 15% for each of Mr. Greennamed executive officers since fiscal year 2010, and Dr. Nuss and 25% for Mr. Yonker.that Mr. Gardner madehad declined to accept a cash bonus of $187,500 that he had earned for fiscal year 2011. The absence of cash bonuses, when coupled with base salaries for named executive officers being below the market 25th percentile (and well below the target market 50th percentile), resulted in actual total cash compensation paid to our named executive officers being below our compensation philosophy target of delivering total cash compensation (base salary plus annual cash bonus) of between the market 50th and 60th percentiles for achieving key business objectives and results. The Committee also considered the effect of the discretionary bonuses on retention and motivation of the named executive officers.
The 2012 discretionary bonuses awarded to our named executive officers who were serving as executive officers at the end of fiscal year 2012 are as follows:
Executive
Discretionary
Bonus
Christopher R. Gardner (1)
$75,000
Martin S. McDermut (2)
$28,500
Martin C. Nuss (3)
$26,438

(1)Mr. Gardner's bonus was determined by multiplying a maximum bonus opportunity of 25% of his base salary by his individual overall bonus payment percentage of 80%.
(2)Mr. McDermut's bonus was fixed at 10% of his base salary.
(3)Dr. Nuss' bonus was determined by multiplying a maximum bonus opportunity of 15% of his base salary by his 2012 individual overall bonus payment percentage of 75%.
Long-term (Equity) Incentives. Annual awards of equity compensation vary by executive level and are generally set to approximate the market 50th percentile levels, with a desire of achieving target total direct compensation between the median and 75th percentile. Officer awards are granted based on their performance in the previous year, the importance of their role in the current year, and a subjective assessment of the other named executive officers' performance, including his viewdifficulty in achieving Vitesse's corporate goals.
We deliver the long-term incentive value through a mix of Mr. Yonker'sstock options and Mr. Green's performance with respectrestricted stock units to the Company's legalour employees. The percentage mix and financial reporting, Mr. Green'snumber of stock options and Dr. Nuss' achievement of intellectual propertyrestricted stock units varies by year and patent sales, Dr. Nuss' contribution to the development of the Company's strategic directions and plan, and Mr. Yonker's contribution towards the Company's financial performance measures such as gross margin and cash. Based on this assessment,by level. For the named executive officers, earned 55%the long-term incentive compensation awards in fiscal year 2012 were paid 25% in stock options and 75% in RSUs, calculated as a percentage of shares underlying such awards.
From 2006 until March 2011, we were limited in our ability to 70%grant equity compensation awards to our named executive officers. With respect to equity awards granted after fiscal year 2007, such awards could not vest until Vitesse's Common Stock was once again listed on the NASDAQ Global Market, which occurred on March 2, 2011. As a consequence of the personal goalslimitations on our ability to effectively use long-term equity incentives as a component of their incentive compensation.

        Becauseexecutive compensation, we believe that our Chief Executive Officer and certain of our other named executive officers hold fewer long-term equity awards than similarly situated executives within our peer group creating a potential disadvantage in terms of employee retention.

Commencing in fiscal year 2010, the Compensation Committee considered the debt restructuring as an important Company objective, the Compensation Committee also included in this year's bonus program a componentresolved to reward thegrant larger equity awards to our named executive officers forover a three year period that approximate the extra time andmarket 75th percentile level in an effort required during fiscal year 2009to close the gap in negotiating and supporting the debt restructuring that was successfully completed on October 30, 2009. Such component was awarded based on the named executive officer's contribution to such successful debt restructuring. Because Mr. Yonker and Mr. Green contributed a substantial portion of the effort on the debt restructuring, they earned the larger portion of this component resulting in a 25% incremental incentive payment based on this goal. Dr Nuss, who had a less substantial role in the debt restructuring, received an incremental 8.3% incentive payment. The total incentive based on personal performance as described in this and the prior paragraph is set forth for theequity ownership by our named executive officers in the Summary Compensation Table.


relative to their peers. The bonus payment to the Chief Executive Officer for fiscal year 2009 was determined at the discretion of the Compensation Committee after assessing the Company's financial performance and reviewing Mr. Gardner's achievement in the following three areas: strategic execution (strategic plan, product execution), financial performance (revenue, gross margin, cash) and market position (growth, customer position) with strategic execution and financial performance weighted twice as heavily as market position. Based on achieved financial performance of the Company and a subjective evaluation of Mr. Gardner's performance, the Compensation Committee determined Mr. Gardner's incentive compensation to be 75% of his base salary, as reflected in the Summary Compensation Table.

        In prior years, bonus payments were made in two equal installments, one before the end of the second quarter of the following fiscal year and one before the end of the fourth quarter of the following fiscal year. The bonus payments for 2009 are to be made in a lump sum in the second quarter of fiscal year 2010 or as soon as practicable after determination by the Compensation Committee, but in no event later than March 15, 2010, in order to comply with Section 409A of the IRS tax code.

        In October 2008, the Compensation Committee determined that it was appropriate to grant equity awards to its named executive officers. Such grants were weighted in such a way to achieve short termshort-term retention by granting restricted stock awardsRSUs and with a focus towards long termlong-term incentive and retention by granting stock options. The number of grants of each type of award made to executive officers was determined at the discretion of the Compensation Committee after consultation with DolmatConnell and taking into consideration market data and each officer's total percent of stock ownership. The grants were considered by DolmatConnell to be within the low- to mid-end of ranges of equity grants based on peer group market data.

        The Compensation Committee determined that these grants should have afinal awards under this three rather than four year vesting schedule to promote retention. The Compensation Committee may consider a fourplan occurred in fiscal year vesting schedule for future grants. As part of the terms of the awards,2012, and the Compensation Committee determinednow expects that regardless offuture long-term equity incentives will more closely approximate the vesting schedule no options would be exercisable, nor would any restricted stock units be converted to shares of common stock until the shares of the Company were listed on a national exchange.

market 50Fiscal Year 2009 Actionsth

        On January 26, 2009, pursuant to an interim and temporary plan designed to protect the immediate operating performance and cash position of the Company, we reduced the base salaries of our percentile level.




The named executive officers, effective February 1, 2009 through the end of theofficers’ long-term incentive awards for fiscal year as follows: (i) Mr. Gardner—20% reduction; (ii) Mr. Yonker—10% reduction; (iii) Dr. Nuss—10% reduction; and (iv) Mr. Green—10% reduction. Also effective February 1, 2009, the Company suspended all matching contributions for its named executive officers in connection with the Company's 401(k) plan. In addition, there were reduced wages and benefits to substantially all other employees of the Company. These actions remained in effect through the end of the Company's 2009 fiscal year. These temporary salary reductions were not intended to reduce potential payments upon termination or change in control. Earned bonuses pursuant to the fiscal year 2009 Executive Bonus Plan were calculated based upon the officers' full salaries before the temporary salary reduction.

        The Compensation Committee thought it appropriate to offer its named executive officers Change in Control Agreements in response to uncertainties surrounding the Company's imminent debt restructuring. Details of these agreements for Mr. Yonker and Mr. Green2012 are set forth below under Employment Agreements. The Compensation Committee also agreed during the year to amend and restate Mr. Gardner's agreement to address certain tax issues as well as to incorporate an obligation to disgorge to the Company certain bonus payments and profits if the Company is required to prepare an accounting restatement to correct an accounting error on an interim or annual financial statement

reported below.


included in a report on Form 10-Q or Form 10-K due to material noncompliance with any financial reporting requirement under the federal securities laws, and the Company's board of directors determines that misconduct by Mr. Gardner has occurred and caused such restatement. The Compensation Committee also later agreed to extend the term of Mr. Gardner's agreement until January 27, 2010. Mr. Gardner's agreement terminated by its terms on January 27, 2010. On February 12, 2010 the Company entered into a new Employment Agreement with Mr. Gardner (see "Employment Agreements" below for a discussion of its terms).

 2012 Awards
OfficerRSUs
(#)		 Options
(#)
Christopher R. Gardner165,000
 55,000
Martin S. McDermut75,000
 25,000
Martin C. Nuss45,000
 15,000
Steve Perna37,500
 12,500
Other Compensation

. The named executive officers enjoy the same benefits as all other employees of the Company,Vitesse, including medical, dental, vision, accidental death and dismemberment, group term life insurance in the amount of two times annual compensation (up to $280,000), business travel insurance, and a 401(k) plan.plan, and long-term disability pay of up to 60% of salary (with a salary cap of $10,000 per month) with an option to buy up to 67% of salary (with a salary cap of $15,000 per month). Paid leave benefits include vacation, sick leave, holidays and a sabbatical after 10 years of employment. The CompanyVitesse offers education assistance and a health/fitness benefit of $100 per year for health club membership or health/fitness classes.

Chief Executive Officer Compensation
The Company also offers monetary rewards for patents.

total compensation paid to Mr. Gardner was 19.5% lower in fiscal year 2012 compared to fiscal year 2011, as shown in the table below.

  CEO Compensation
  2011 2012
Base Salary (1) $377,644
 $375,000
Annual Bonus —
 75,000
Long-term Incentives (2) 875,688
 558,800
All Other Compensation —
 —
Total $1,253,332
 $1,008,800
Percent Change  
 (19.5)%

(1)The difference in the salary amount in fiscal year 2011 compared to fiscal year 2012 reflects the change in December 2010 from a bi-weekly payroll period to a semi-monthly payroll period.
(2)Long-term incentives include value of stock and option awards.
Report of Compensation Committee
The Compensation Committee Report

of our Board of Directors is primarily responsible for determining the annual salaries and other compensation of executive officers and administering our stock incentive and stock purchase plans. The following Compensation Committee Report does not constitute soliciting materials and shall not be deemed filed or incorporated by reference into any other filings by us under the Securities Act of 1933 or the Exchange Act, except to the extent we specifically incorporate this Compensation Committee Report by reference therein.

        The Board's Compensation Committee has submitted the following report for inclusion in this Amendment:

        We have reviewed and discussed the Compensation Discussion and Analysis contained insection of this Amendment with management. Based on our review of and the discussionsproxy statement with management with respect to the Compensation Discussion and Analysis, the Compensation Committeebased on such review and discussion has recommended to theour Board of Directors that the Compensation Discussion and Analysis section be included in Vitesse's 2012 Annual Report on Form 10-K and in this Amendment.

        The foregoing report is provided by the following directors, who constitute the Compensation Committee:

Compensation Committee
G. Grant Lyon
Edward Rogas, Jr.
G. William LaRosa

Edward Rogas, Jr., member

Compensation Committee Interlocks and Insider Participation

        The Compensation Committee currently consists of G. Grant Lyon, Chairperson, and Edward Rogas, Jr. Former directors Guy W. Adams, Vincent Chan, Robert A. Lundy, and Willow B. Shire served as members of the Compensation Committee during fiscal year 2009. No director who served on the Compensation Committee of our Board during fiscal year 2009 currently is, or during fiscal year 2009, was an officer or employee of the Company or had any relationship requiring disclosure by us under Item 404 of Regulation S-K. In addition, no member of our Compensation Committee is, or during fiscal year 2009 was, employed by a company whose Board of Directors includes or included any members of our management.




Fiscal Year 2009 EXECUTIVE COMPENSATION
Summary Compensation Table


The following table sets forth theinformation concerning all compensation earned bypaid to our named executive officers for services renderedto us in all capacities to the Company during the fiscal years ended September 30, 2009, 20082012, 2011 and 2007:

Name and Principal Position
 Year Salary(1) Bonus(2) Stock
Awards(3)		 Option
Awards(3)		 Non-Equity
Incentive Plan
Compensation(4)		 All Other
Compensation(5)		 Total(6) 

Christopher R. Gardner

  2009 $303,333 $— $23,788 $273,218 $262,500 $1,212 $864,051 
 

Chief Executive Officer

  2008  350,000  262,500  —  316,679  —  6,926  936,105 

  2007  328,462  175,000  —  320,540  —  5,723  829,725 

Richard C. Yonker

  
2009		  
256,667		  
—		  
11,894		  
54,457		  
116,875		  
2,689		  
442,582		 
 

Chief Financial Officer

  2008  275,000  —  —  41,098  74,250  7,734  398,082 

  2007  223,438  25,000  —  30,939  80,000  6,029  365,406 

Dr. Martin C. Nuss

  
2009		  
205,333		  
—		  
5,947		  
7,246		  
38,133		  
2,539		  
259,198		 
 

Vice President, Technology

  2008  193,991  —  —  23,672  66,000  5,312  288,975 
 

and Strategy

                         

Michael B. Green(7)

  
2009		  
205,333		  
—		  
5,947		  
5,797		  
73,150		  
2,400		  
292,627		 
 

Vice President, General

  2008  205,000  —  —  —  53,300  6,150  264,450 
 

Counsel and Secretary

  2007  153,750  20,000  —  —  41,000  4,021  218,771 
(1)
Salary amounts reflect the actual base salary payments made to the2010. For fiscal year 2012, our named executive officers in fiscal years 2009, 2008were: Christopher R. Gardner, Chief Executive Officer; Martin S. McDermut, Chief Financial Officer; Dr. Martin C. Nuss, Vice President, Technology and 2007.

(2)
Bonus amounts for fiscal years 2009, 2008Strategy; and 2007 reflect non-incentive plan based cash payments.

(3)
Amounts reflected for stock and option awards are the dollar amounts recognized for financial reporting purposes in fiscal years 2009, 2008 and 2007 in accordance with ASC 718. The dollar amount recognized is computed under ASC 718, applying the same valuation model and assumptions used for financial reporting purposes, disregarding the estimate of forfeitures related to service-based vesting conditions. See our Form 10-K for the years ended September 30, 2009 and prior for the weighted-average assumptions used in calculating the ASC 718 grant date fair values of all awards and options.

(4)
Non-equity incentive plan compensation represents incentive bonuses earned for services rendered during fiscal years 2009, 2008 and 2007. The bonus payments for 2009 are to be made in a lump sum by the end of the second quarter of fiscal year 2010 or as soon as practicable after determination by the Compensation Committee, but in no event later than March 15, 2010.

(5)
Represents matching contributions to the Company's 401(k) plan from October 1, 2008 through January 31, 2009, and for fiscal years 2008 and 2007. Effective February 1, 2009, the Company suspended all matching contributions to the Company's 401(k) plan for its named executive officers.

(6)
Compensation reflected in the table does not include perquisites, personal benefits and other compensation amounts that do not, in the aggregate for each named individual for each year, exceed $10,000.

(7)
Steve Perna, Vice President, Product Marketing. Mr. GreenPerna resigned from the Company effective as February 5, 2010.
in May 2012.
Name and
Principal Position		Year Salary (1) Bonus (2) Stock
Awards (3)		 Option
Awards (3)		 Non-Equity
Incentive Plan
Compensation (4)		 All Other
Compensation
  
 Total
Christopher R. Gardner2012 $375,000
 $75,000
 $419,100
 $139,700
 $—
 $—
  $1,008,800
Chief Executive Officer2011 377,644
   642,664
 233,024
 —
 —
  
 1,253,332
 2010 367,404
   468,000
 347,760
 206,250
 —
  
 1,389,414
Martin S. McDermut (5)2012 285,000
 28,500
 190,500
 63,500
 —
 —
  567,500
Chief Financial Officer2011 53,529
   166,500
 117,815
 —
 —
  
 337,844
 2010 —
   —
 —
 —
 —
  
 —
Dr. Martin C. Nuss2012 235,000
 26,438
 114,300
 38,100
 —
 —
  413,838
Vice President, Technology and Strategy2011 249,311
   175,272
 63,552
 —
 —
  
 488,135
2010 225,769
   104,000
 77,240
 28,200
 —
  
 435,209
Steve Perna (6)2012 149,587
   95,250
 31,750
   7,231
(7) 
 283,818
Vice President, Product Marketing2011 240,273
   58,424
 21,184
 —
 75,000
(8) 
 394,881
 2010 36,154
   95,750
 70,203
 —
 75,000
(8) 
 277,107

(1)Salary amounts reflect the actual base salary payments, as of the end of the respective fiscal year, to the named executive officers.
(2)These amounts reflect discretionary cash bonuses awarded to the named executive officers.
(3)These amounts represent the grant date fair value of the stock and stock option awards determined in accordance with ASC Topic 718.  These amounts may not correspond to the actual value eventually realized by the officer, which depends in part on the market value of our Common Stock in future periods.  Assumptions used in calculating these amounts are set forth in the Notes to Consolidated Financial Statements included in our annual report on Form 10-K for the year ended September 30, 2012.
(4)Non-equity incentive plan compensation represents incentive bonuses earned pursuant to awards granted under a cash bonus plan.
(5)Mr. McDermut's employment with Vitesse commenced on July 27, 2011.
(6)Mr. Perna's employment with Vitesse commenced on August 2, 2010 and terminated on May 18, 2012.
(7)Consists of severance pay.
(8)Consists of a relocation allowance of $150,000, paid out in two installments in fiscal year 2011 and 2010.






Grants of Plan-Based Awards in Fiscal Year 2009

2012

The following table sets forth information relating to plan-based awards granted to our named executive officers in fiscal year 2009:

2012: 


  
  
  
  
 All Other
Stock
Awards:
Number of
Shares of
Stock or
Units		 All Other
Option
Awards:
Number of
Securities
Underlying
Options		  
  
 

 Estimate Future
Payouts Under Non-Equity
Incentive Plan Awards(1)		  
  
 Grant Date
Fair Value
of Stock
and Option
Awards(2)		 

  
All Other
Stock
Awards:
Number of
Shares of
Stock or
Units		 All Other
Option
Awards:
Number of
Securities
Underlying
Options
Name
 Threshold Target Maximum Grant Date Estimate Future Payouts Under Non-Equity Incentive Plan Awards (1) Grant Date All Other
Stock Awards:
Number of Stock Units		 All Other
Option
Awards:
Number of
Securities
Underlying Options		 Exercise Price
of Options (Per Share) (2)		 Grant Date
Fair Value of
Stock and Option Awards (3)
 Threshold Target Maximum        

Christopher R. Gardner

 $— $350,000 $525,000         $—
 $375,000
 $562,500
    
  
  
  

       10/13/2008   400,000 $0.37 $90,160   
  
  
 12/9/2011 165,000
  
  
 $419,100

       10/13/2008 200,000     74,000   
  
  
 12/9/2011  
 55,000
 $2.54
 139,700

Richard C. Yonker

 
—		 
110,000		 
165,000		           
Martin S. McDermut —
 114,000
 171,000
    
  
  
  

       10/13/2008   200,000 0.37 45,080   
  
  
 12/9/2011 75,000
  
  
 190,500

       10/13/2008 100,000     37,000   
  
  
 12/9/2011  
 25,000
 2.54
 63,500

Dr. Martin C. Nuss

 
—		 
66,000		 
88,000		            —
 70,500
 117,500
    
  
  
  

       10/13/2008   100,000 0.37 22,540   
  
  
 12/9/2011 45,000
  
  
 114,300

       10/13/2008 50,000     18,500   
  
  
 12/9/2011  
 15,000
 2.54
 38,100

Michael B. Green(3)

 
—		 
66,000		 
88,000		           
Steve Perna —
 70,500
 117,500
        

       10/13/2008   80,000 0.37 18,032        12/9/2011 37,500
     95,250

       10/13/2008 50,000     18,500        12/9/2011   12,500
 2.54
 31,750
(1)
Represents possible payouts for fiscal year 2009

(1)Represents possible payouts for fiscal year 2012 for the named executive officers under their respective bonus plans. Amounts actually earned are displayed in the Summary Compensation Table.
(2)The exercise price of all stock options is equal to the closing price of our Common Stock on the grant date.
(3)The grant date fair value of the stock and stock option awards is determined in accordance with ASC Topic 718, but disregarding the estimate of forfeitures related to service-based vesting conditions. Assumptions used in calculating these amounts are set forth in the Notes to Consolidated Financial Statements included in our annual report on Form 10-K for the year ended September 30, 2012.

Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table
Salary amounts reported in the Summary Compensation Table.

(2)
The grant date fair value of option awards has been calculated in accordance with ASC 718. In contrastTable reflect the actual base salary payments made to how we present amountsthe named executive officer in the "Summaryrespective fiscal year. Non-equity incentive plan compensation amounts reported in the summary compensation table reflect non-incentive plan based cash payments. Non-equity incentive plan compensation represents incentive bonuses earned for services rendered during the respective fiscal year. The non-equity incentive plan compensation payments for fiscal year 2012 are paid in a lump sum by the end of the first quarter of the fiscal year following the year in which the bonus is earned, or as soon as practicable after determination and certification of the actual financial performance levels for the year and approval by the Compensation Table," we report the amountsCommittee but, in this column without apportioning the amount over the applicable service or vesting period.no event, later than March 15, 2013.


(3)
Mr. Green resigned from the Company effective as of February 5, 2010.



Outstanding Equity Awards at Fiscal Year-End 2009

2012

The following table provides information regarding the holdings of equity awards by our named executive officers at September 30, 2009:

2012:


 Option Awards Stock Awards    Option Awards Stock Awards
Name
 Number of
Securities
Underlying
Unexercised
Options
Exercisable		 Number of
Securities
Underlying
Unexercised
Options
Unexercisable		 Option
Exercise
Price per
Share		 Option
Expiration
Date		 Number of
Shares or Units
of Stock That
Have Not
Vested		 Market Value of
Shares or Units of
Stock That Have
Not Vested(a)		  Grant Date Number of
Securities
Underlying
Unexercised
Options
Exercisable		   Number of
Securities
Underlying
Unexercised
Options
Unexercisable		   Option
Exercise
Price per
Share		 Option
Expiration
Date		 Number of
Shares or
Units of
Stock That
Have Not
Vested		   Market Value
of Shares or
Units of
Stock That
Have Not
Vested (A)

Christopher R. Gardner

 120,000(1) — $35.91 10/19/2009 200,000(b)$74,000     
    
    
   264,300
 
(16) 
 $644,892

 200,000(2) — 17.44 4/6/2011      10/17/2002 11,250
 
(1) 
  
   16.52
 10/17/2012  
    

 120,000(3) — 7.27 10/2/2011      10/20/2004 5,000
 
(2) 
  
   139.40
 10/20/2013  
    

 20,000(4) — 7.27 10/2/2011      10/27/2004 3,750
 
(3) 
  
   51.60
 10/27/2014  
    

 2,885(5) — 7.27 10/2/2011      10/27/2004 3,750
 
(4) 
  
   51.60
 10/27/2014  
    

 270,600(6) — 7.27 10/2/2011      10/27/2004 5,625
 
(5) 
  
   51.60
 10/27/2014  
    

 29,400(7) — 7.27 10/2/2011      10/27/2004 1,875
 
(6) 
  
   51.60
 10/27/2014  
    

 225,000(8) — 0.83 10/17/2012      12/2/2005 5,500
 
(7) 
  
   48.00
 12/2/2015  
    

 100,000(9) — 6.97 10/20/2013      6/21/2006 20,000
 
(8) 
  
   30.60
 6/21/2016  
    

 75,000(10) — 2.58 10/27/2014      10/13/2008 20,000
 
(9) 
  
   7.40
 10/13/2018  
    

 75,000(11) — 2.58 10/27/2014      2/12/2010 45,000
 
(10) 
 45,000
 
(10) 
 5.20
 2/12/2020  
    

 112,500(12) — 2.58 10/27/2014      12/9/2010 18,150
 
(11) 
 54,450
 
(11) 
 4.36
 12/9/2020  
    

 — 37,500(13) 2.58 10/27/2014      12/9/2011 13,750
 
(12) 
 41,250
 
(12) 
 2.54
 12/9/2021  
    
Martin McDermut    
 
  
  
 
  
  
    
    
 8/10/2011 27,083
 
(13) 
 22,917
 
(13) 
 3.33
 8/10/2021 79,167
 
(17) 
 193,167
 12/9/2011 6,250
 
(12) 
 18,750
 
(12) 
 2.54
 12/9/2021    
Dr. Martin C. Nuss    
 
  
  
 
  
  
    
 
  
  

 82,500(14) 27,500(14) 2.40 12/2/2015      11/16/2007 10,000
 
(14) 
   19.80
 11/16/2017 70,566
 
(18) 
 172,181

 300,000(15) 100,000(15) 1.53 6/21/2016      10/13/2008 5,000
 
(9) 
   7.40
 10/13/2018  
 
  
  

 — 400,000(16) 0.37 10/13/2018      2/25/2010 10,000
 
(15) 
 10,000
 
(15) 
 5.20
 2/25/2020  
 
  
  

Richard C. Yonker

 
150,000
(17)		 
150,000
(17)		 
0.86		 
12/11/2016		 
100,000
(b)		 
37,000		 

 — 200,000(16) 0.37 10/13/2018      12/9/2010 4,950
 
(11) 
 14,850
 
(11) 
 4.36
 12/9/2020  
 
  
  

Dr. Martin C. Nuss

 
50,000
(18)		 
150,000
(18)		 
0.99		 
11/16/2017		 
50,000
(b)		 
18,500		 

 — 100,000(16) 0.37 10/13/2018      12/9/2011 3,750
 
(12) 
 11,250
 
(12) 
 2.54
 12/9/2021    

Michael B. Green

 
—		 
80,000
(16)		 
0.37		 
10/13/2018		 
50,000
(b)		 
18,500		 
(1)
Annual Grant: Vested 20% on 10/1/00, 20% on 10/1/01, 20% on 10/1/02, 20% on 10/1/03, and 20% on 10/1/
(A)
The market value of the stock awards is based on the closing price per share of Vitesse’s stock on September 30, 2012, which was $2.44 per share.
(1)Annual Grant: Vested 20% on 10/17/02, 20% on 4/17/03, 20% on 10/17/03, 20% on 4/17/04, and 20% on 10/17/04
(2)Annual Grant: Vested 25% on 10/20/04, 25% on 10/20/05, 25% on 10/20/06, and 25% on 10/20/07
(3)Annual Grant: Vested 50% on 10/27/07 and 50% on 10/27/08
(4)Annual Grant: Vested 50% on 10/27/05 and 50% on 10/27/06
(5) Annual Grant: Vested 33% on 10/27/06, 33% on 10/27/07, and 33% on 10/27/08
(6)Annual Grant: Vested 100% on 10/27/09
(7)Annual Grant: Vested 25% on 12/2/06, 25% on 12/2/07, 25% on 12/2/08, and 25% on 12/2/09
(8)Retention Grant: Vested 25% on 6/21/07, 25% on 6/21/08, and 25% on 6/21/09 and vests 25% on 6/21/10
(9) Annual Grant: Vested 50% on 10/14/09 and vested 25% on 10/13/10, 25% on 10/13/2011
(10)Employment Agreement Grant: Vested 25% on 2/12/11, 25% on 2/12/12, and 25% on 2/12/13 and vests 25% on 2/12/14
(11) Annual Grant: Vested 25% on 12/10/11 and vests 25% on 12/10/12, 25% on 12/10/13, and 25% on 12/10/14
(12)Annual Grant: Vested 25% on 2/1/12, vests 25% on 12/9/12, 25% on 12/9/13 and 25% on 12/9/14
(13)Employment Agreement Grant:Vests monthly for 24 months  
(14)Employment Agreement Grant: Vested 25% on 11/16/08, 25% on 11/16/09, 25% on 11/16/10 and 25% on 11/16/11
(15)Employment Agreement Grant: Vested 33% on 2/25/11 and 33% on 2/25/12 and vests 33% on 2/25/13
(16)Annual Grant-10,000: Vested 50% on 10/14/09 and vested 25% on 10/13/10 and 25% on 10/13/11; Employment Agreement Grant-90,000: Vested 33% on 2/12/11 and 33% on 2/12/12 and vests 33% on 2/12/13; Annual Grant - 147,400: Vested 25% on 12/9/11 and vests 25% on 12/9/12 and 25% on 12/9/13 and 25% on 12/9/14; and Annual Grant - 165,000: Vests 25% on 2/1/12, 25% on 12/9/12, 25% on 12/9/13 and 25% on 12/9/14                   
(17)Employment Agreement Grant-50,000: Vests monthly for 24 months; Annual Grant - 75,000: Vests 25% on 2/1/12, 25% on 12/9/12, 25% on 12/9/13 and 25% on 12/9/14
(18)Annual Grant-2,500: Vested 50% on 10/14/09 and vests 25% on 10/13/10 and 25% on 10/13/11; Employment Agreement Grant-20,000: Vested 33% on 2/25/11 and 33% on 2/25/12 and vests 33% on 2/25/13; Annual Grant - 40,200: Vested 25% on 12/9/11 and vests 25% on 12/9/12, 25% on 12/9/13 and 25% on 12/9/14; and Annual Grant - 45,000: Vests 25% on 2/1/12, 25% on 12/9/12, 25% on 12/9/13 and 25% on 12/9/14


(2)
Annual Grant: Vested 20% on 1/1/02, 20% on 1/1/03, 20% on 1/1/04, 20% on 1/1/05, and 20% on 1/1/06

(3)
Special Grant: Vested 25% on 10/1/01, 25% on 10/1/02, 25% on 10/1/03, and 25% on 10/1/04

(4)
Special Grant: Vested 20% on 1/1/02, 20% on 1/1/03, 20% on 1/1/04, 20% on 1/1/05, and 20% on 1/1/06

(5)
Special Grant: Vested 100% on 12/31/02

(6)
Annual Grant: Vested 22% on 10/1/02, 22% on 10/1/03, 22% on 10/1/04, 17% on 10/1/05, and 17% on 10/1/06

(7)
Annual Grant: Vested 1% on 10/1/02, 1% on 10/1/03, 4% on 10/1/04, 47% on 10/1/05, and 47% on 10/1/06

(8)
Annual Grant: Vested 20% on 10/17/02, 20% on 4/17/03, 20% on 10/17/03, 20% on 4/17/04, and 20% on 10/17/04

(9)
Annual Grant: Vested 25% on 10/20/04, 25% on 10/20/05, 25% on 10/20/06, and 25% on 10/20/07

(10)
Annual Grant: Vested 50% on 10/27/07 and 50% on 10/27/08

(11)
Annual Grant: Vested 50% on 10/27/05 and 50% on 10/27/06

(12)
Annual Grant: Vested 33% on 10/27/06, 33% on 10/27/07, and 34% on 10/27/08

(13)
Annual Grant: Vested 100% on 10/27/09

(14)
Annual Grant:


Option Exercises and Stock Vested 25%in Fiscal Year 2012
The following table provides information on 12/2/06, 25% on 12/2/07, 25% on 12/2/08,RSU vesting and 25% on 12/2/09

(15)
Retention Grant: Vested 25% on 6/21/07, 25% on 6/21/08, and 25% on 6/21/09 and vests 25% on 6/21/10

(16)
Annual Grant: Vested 50% on 10/14/09 and vests 25% on 10/13/10 and 25% on 10/13/11. Mr. Green resigned from the Company effective as February 5, 2010.

(17)
Employment Agreement Grant: Vested 25% on 12/11/07, 25% on 12/11/08, and 25% on 12/11/09 and vests 25% on 12/11/10

(18)
Employment Agreement Grant: Vested 25% on 11/16/08 and 25% on 11/16/09 and vests 25% on 11/16/10 and 25% on 11/16/11

(a)
The market value of the stock awards is based on the closing price per share of Vitesse's stock on September 30, 2009, which was $0.37.

(b)
Annual Grant: Vested 50% on 10/14/09 and vests 25% on 10/13/10 and 25% on 10/13/11

Stock Option Exercises

        There were no stock options exercised by our named executive officers or vestingfor each of restricted stock awards held by ourthe named executive officers during fiscal year 2009.

Pension Benefits and Nonqualified Deferred Compensation for Fiscal Year 2009

        We do not have any plans that provide pension benefits to our named executive officers, nor do we have any nonqualified deferred compensation plans that provide for deferred compensation to our named executive officers.

2012. 

  Option Awards Stock Awards
Name Number of Shares
Acquired on Exercise		 Value Realized on Exercise Number of Shares
Acquired on Vesting		 Value Realized on Vesting
Christopher R. Gardner —
 $—
 110,600
 $341,112
Martin S. McDermut —
 —
 43,750
 131,396
Martin C. Nuss —
 —
 28,592
 88,003
Steve Perna 3,125
 8,032
 12,725
 38,978
Employment Agreements

Christopher R. Gardner Employment Agreement

        Mr. Gardner's compensation was established by his employment agreement, initially dated June 26, 2006.

On July 27, 2007, theFebruary 12, 2010, we entered into a two year employment agreement with Mr.Christopher Gardner, was amended. Under the amended agreement, his base salary was increased to $350,000 per year, effective April 1, 2007. On February 23, 2009, hisour President and Chief Executive Officer, which agreement was amended and restated (as amended, the "Prior Gardner Agreement") with no change in salary to address certain tax issues and provide for a return of bonuses paid under certain circumstances described below. During 2009, the Company implemented several measures to reduce expenses, including reductions in executive salaries. Effective February 1, 2009, Mr. Gardner's base salary was reduced by 20%, which reduction remained in effect through September 30, 2009. On July 8, 2009, his contract was amended2012 to extend the term of the contract to January 27, 2010.

        Onuntil February 12, 2010, the Company entered into a new Employment Agreement with2013. Pursuant to his employment agreement, Mr. Gardner (the "2010 Employment Agreement"). Pursuant to the terms of the 2010 Employment Agreement, Mr. Gardner will receive areceives an annual base salary of $375,000 and is eligible to receiveparticipate in a cash incentive plan for which provides him with the opportunity to earn a target bonus of 100% of his base salary and a maximum bonus of 150% of his base salary. Thesalary, with the amount of any suchhis bonus is subject todetermined at the discretion of the Company's Compensation Committee. In connection with entering into the 2010 Employment Agreement,Mr. Gardner is eligible to receive equity awards under the Company's Compensation Committee grantedstock incentive plans. Mr. Gardner 1,800,000 restricted stock units ("RSUs") and stock optionsis entitled to purchase 1,800,000 shares. The RSUs and stock options were granted pursuant to the termsfive weeks of the Company's amended and restated 2001 Stock Incentive Plan. The stock options have an exercise price of $0.26 per share and vest 25%vacation per year, over four years. The RSUs vest over three years, with one-third of the RSU grant vesting on each one-year anniversary of the date of grant.

and is entitled to all other employee benefits provided to other senior executives.

If Mr. Gardner's employment is terminated by him for Good Reasongood reason or by Vitesse other than For Cause,for cause, Mr. Gardner would beis entitled to receive a lump sum payment equal to (a) two years of his



base salary, plus (b) two times his maximum target bonus, plus (c) a pro ratapro-rata portion (based upon the portion of the fiscal year prior to his termination date) of either (i) his target bonus or (ii) inbonus. In the case of a termination for such reasons within 24 months following a Changechange of Control Event, a pro rata portioncontrol of Vitesse, Mr. Gardner receives the compensation noted above for items (a) and (b), plus the greater of his target bonus in the fiscal year in which termination occurs or the amount of his bonus in the prior fiscal year, whichever is greater. year.

If Mr. Gardner's employment is terminated by Vitesse other than For Causefor cause during the one-year period prior to a Changechange of Control Eventcontrol of Vitesse and Mr. Gardner can demonstrate that his termination arose in connection with or in anticipation of such Changechange of Control Event (including as a result of the request of a third party which had taken steps reasonably calculated to effect such Change of Control Event),control, then all RSUs which are subject solely to time-based vesting and were outstanding immediately prior to Mr. Gardner's final day of employment will become fully vested and, to the extent such Changechange of Control Eventcontrol occurs during the six-month period following the termination date of Mr. Gardner's employment, all of his outstanding options which are subject solely to time-based vesting shall become fully vested asat the time of the Changechange of Control Event.control. If
Mr. Gardner's employment is terminated by him for Good Reasongood reason or by the Company other than For Causefor cause during the 24-month period following a Changechange of Control Event,control, then all outstanding stock options and RSUs which are subject solely to time-based vesting shall become fully vested.

        "Change of Control Event" means (i) a consolidation or merger ofvested and his stock options shall remain exercisable for an additional 90 days following the Company with or into any other entity or entities or the effectuation by the Company of a transaction or series of related transactions in which more than 50% of the voting power of the Company is disposed of or (ii) a sale, conveyance or disposition of all or substantially all the assets of the Company.

        "For Cause" is defined as termination by reason of: (i) the executive's conviction of a felony or plea of guilty or nolo contendere to a felony; (ii) the executive's intentional failure or refusal to perform his employment duties and responsibilities; (iii) the executive's intentional misconduct that injures the Company's business; (iv) the executive's intentional violation of any other material provisiondate of his employment agreement or the Company's Codetermination of Business Conduct and Ethics; or (v) as otherwise provided for in Section 8 of the employment agreement. Section 8 of employment.

Mr. Gardner's employment agreement is titled"Compliance with Vitesse Policies and Procedures" and states:

        "Good Reason" is defined as the occurrence, without the executive's written consent, of any of the following actions unless the action is fully corrected (if possible) within 15 days after the Company receives written notice of the action from the executive: (i) a material reduction in the executive's base salary; (ii) the Company's failure to pay the executive any material amount that is expressly required to be paid under his employment agreement; (iii) the Company's material and adverse reduction of the nature of the executive's duties and responsibilities, disregarding mere changes in title; or (iv) the Company's requirement that the executive perform his principal employment duties at an office that is more than 35 miles from Camarillo, California.

        The 2010 Employment Agreement contains a provision that would require Mr. Gardnerhim to return to Vitesse any bonus payments earnedhe received if the Company were required to prepare an accounting restatement to correct an accounting error on an interim or annual financial statement included in a report on Form 10-Q or Form 10-K, due to material noncompliance with any financial reporting requirement under the federal securities laws, and the Company'sour Board of Directors determines that misconduct by Mr. Gardner occurred and caused such restatement.

        The 2010 Employment Agreement terminates on February 12, 2012.


Martin S. McDermut

        Mr. Yonker's compensation was established by

Effective July 27, 2011, we entered into a two year employment agreement with Martin McDermut, our Chief Financial Officer. Pursuant to his employment agreement, dated November 16, 2006, and was amended on June 26, 2007. An employment agreement dated February 20, 2009 superseded the prior Agreement and Amendment. Under his current agreement, Mr. YonkerMcDermut receives aan annual base salary of $275,000 per year. During 2009,$285,000 and is eligible to participate in the Company implemented several measuresCompany's cash incentive plan for senior executives which provides him with the opportunity to reduce expenses, including reductions in executive salaries. Effective February 1, 2009, Mr. Yonker'searn a target bonus of 40% of his base salary was reduced by 10%, which reduction remained in effect through September 30, 2009.and a maximum bonus of 60% of his base salary, with the amount of his bonus determined at the discretion of the Compensation Committee. Mr. Yonker's employment agreement terminates on February 20, 2011, but automatically renews for an additional 24 months if no prior written noticeMcDermut is eligible to receive equity awards under the Company's stock incentive plans. Mr. McDermut is entitled to three weeks of terminationvacation per year, and is provided.

entitled to all other employee benefits provided to other senior executives.




If Mr. Yonker'sMcDermut's employment is terminated by him for Good Reasongood reason or by Vitesse other than For Cause (defined infor cause, Mr. McDermut is entitled to a manner substantially the same as in Mr. Gardner's employment agreement), death, or Disability (defined in a manner substantially the same as in Mr. Gardner's employment agreement), he will receive severance paylump sum payment equal to 12 months of his then base salary and beremains eligible for his earned bonus, prorated using the maximum potential annual bonus amount through his date of termination. In addition, if such termination of employment occurs within the 12 months following a change in control, (defined in a manner substantially the same as in Mr. Gardner's employment agreement), Mr. YonkerMcDermut would be entitled to (a) an additional bonuspayment equal to the amount of his maximum potential annual bonus for the fiscal year. If suchyear in which his termination occurred, (b) immediate vesting of employment does not occur within 12 months following a change in control, Mr. Yonker would be eligible for an additional bonus equal to a full year bonus based on his performance. In the event of a Change in Control (defined in a manner substantially the same as in Mr. Gardner's employment agreement) of the Company (or its successor) and any involuntary termination other than For Cause or Mr. Yonker's resignation for Good Reason within one year of such a Change in Control, then any equity compensation awards granted priorwith respect to the Change in Controlnumber of shares that would be accelerated and immediately becomehave vested as though the equity awards were vesting over four years in 48 equal monthly amounts, and as thoughif Mr. YonkerMcDermut had completed an additional two years of continuous service with the Company, and thosehis stock options would beshall remain exercisable for an additional 90 days following the date of his termination of employment.

        "Good Reason" is defined as the occurrence, without the executive's written consent, of anyemployment, and (c) payment of the following actions unless the action is fully corrected (if possible) within 15 days after the Company receives written noticecost of the action from the executive: (i)continuation of group medical and dental benefits for a material reduction in the executive's base salary; (ii) the Company's failure to pay the executive any material amount that is expressly required to be paid under hisperiod of 24 months.

Mr. McDermut's employment agreement; (iii) the Company's material and adverse reduction of the nature of the executive's duties and responsibilities, disregarding mere changes in title; (iv) the Company's requirement that the executive perform his principal employment duties at an office that is more than 35 miles from Camarillo, California or (v) the Company's failure to renew the agreement.

        Mr. Yonker is bound by a non-solicitation clause for the duration of his employment pursuant to his agreement and for two years thereafter. This clause precludes him from directly or indirectly soliciting any person who is currently employed or has been employed by the Company within the prior six months. During the term of his agreement, Mr. Yonker is also precluded from influencing customers, vendors, and other partners of the Company in a way that would divert business away from the Company or otherwise materially interfere with any business relationship of the Company.

        Mr. Yonker's agreement contains a provision that would require him to return to Vitesse any bonus payments earnedhe received if the Company were required to prepare an accounting restatement to correct an accounting error on an interim or annual financial statement included in a report on Form 10-Q or Form 10-K, due to material noncompliance with any financial reporting requirement under the federal securities laws, and theour Board determines that misconduct by Mr. YonkerMcDermut occurred and caused such restatement. Mr. Yonker is also eligibleMcDermut would be required to participate indisgorge (i) any bonus or other incentive-based or equity-based compensation he received from the Executive Bonus Plan.

Company during the 12-month period following the first public issuance or filing with the SEC (whichever first occurs) of the financial document embodying such error, and (ii) any net profits realized by Mr. McDermut from the sale of the Company's stock during that 12-month period.

        On November 16, 2007, the Board of Directors appointed

Dr. Martin Nuss serves as our Vice President Technology and Strategy. Dr. Nuss receivedStrategy pursuant to an employment letter fromagreement with us, dated October 26, 2007, as amended and restated effective November 30, 2011. The term of the Company pursuantagreement will continue until terminated by either party. Pursuant to which the Company agreed that he is entitled to receive $220,000 ashis employment letter agreement, Dr. Nuss receives an annual base salary. During 2009, the Company implemented several measures to reduce expenses, including reductions in executive salaries. Effective February 1, 2009, Dr. Nuss' base salary, was reduced by 10%, which reduction remained in effect through September 30, 2009.

        Dr. Nusspresently is $235,000, and is eligible to participate in the Executive Bonus PlanCompany's cash incentive plan for senior executives which presently provides him with the opportunity to earn a target bonus of 30% of his base salary and hea maximum bonus of 50% of his base salary, with the amount of his bonus determined at the discretion of the Compensation Committee. Dr. Nuss is also entitled to all other employee benefits provided to other senior executives. In the event that his

If Dr. Nuss' employment is terminated at any time by the Companyhim for good reason or by Vitesse other than for cause, or he terminates his employment within nine months after a Change in Control resulting in a material change in his position, responsibilities, or compensation, Dr. Nuss will beis entitled to a lump sum payment equal to 12 months of his then base salary. For this purpose, "for cause" is definedsalary, unless termination occurs within 12 months following a change in control.  If such termination of employment occurs within the 12 months following a manner substantiallychange in control, Dr. Nuss would be entitled to (a) 9 months of his then base salary, (b) an additional payment equal to one week of base salary for every 12 months Dr. Nuss has been employed by Vitesse, (c) his earned bonus for the same asfiscal year in Mr. Gardner's employment agreement withwhich the addition of failuretermination occurred pro-rated based on termination date and subject to effectively perform his job dutiesother terms and responsibilities and "Change in Control" means the occurrence of anyconditions of the following:

Potential Payments upon Termination or Change-in-Control

        Under the terms of the Prior Gardner Agreement, if Mr. Gardner's employment were to have been terminated on September 30, 2009, for Good Reason or for reasons other than For Cause, death or disability, he would have received a lump sum severance payment of $1,575,000 and he would be engaged as a consultant at $3,000 per month until the earlier of: (i) three years after thehis termination occurred, (e) immediate vesting of his employment; and (ii) one year after the date we have an effective registration statement under the Securities Actequity compensation awards with respect to the number of shares to be issued upon exercise of options granted to him. In addition, Mr. Gardner's stock options outstanding on the date of his termination would continue to vest normally during his service as a consultant and those options would be exercisable until the earlier of 90 days following his termination as a consultant and the normal expiration dates of those options. As of September 30, 2009, all of Mr. Gardner's outstanding stock option awards were out-of-the-money.

        If Mr. Yonker's employment were to have been terminated on September 30, 2009, for Good Reason or for reasons other than For Cause, death or Disability, hethat would have received a lump sum payment of his annual base salary of $275,000 plus $233,750 (twice his earned bonus of $116,875). If a Change in Control had occurred within the 12 months prior to September 30, 2009, Mr. Yonker would have received his annual base salary of $275,000 plus $281,875 (his earned bonus of $116,875 and an additional $165,000 upon such termination, representing his maximum bonus for the year). In addition,



the shares underlying all of Mr. Yonker's outstanding stock options and restricted stock unit awards would be accelerated and immediately become vested as though equity awards were vesting over four years in 48 equal monthly amounts, and heif Dr. Nuss had completed an additional 24 monthstwo years of continuous service with the Company. Thoseand his stock options would beshall remain exercisable for an additional 90 days after termination. following the date of his termination of employment, and (f) payment of the cost of COBRA medical and dental benefits for a period of 12 months.

Steve Perna
On May 18, 2012, we entered into a resignation and separation agreement and general release of claims with Steve Perna, in connection with his resignation as our Vice President, Product Marketing. Pursuant to the agreement, we paid Mr. Perna severance in the amount of $7,230.72 and allowed him to retain a computer and cellular telephone, and Mr. Perna provided us with a general release of claims and agreed to cooperate with and assist the Company with respect to any pending or future litigation, disputed claims or other matters.

Potential Payments upon Termination or Change-in-Control
As described above, our employment agreements with each of our named executive officers who were employed by Vitesse at September 30, 2009,2012 provide for severance benefits in the event that the executive's employment is terminated without cause or for good reason. These severance benefits generally increase if any such termination occurs in connection with a change in control of Vitesse. We do not have any agreements or other arrangements that provide for payments solely upon a change in control of Vitesse without the termination of employment.



Without Change in Control
The following table sets forth severance payments and benefits that we would have been obligated to pay to the named executive officers who were employed by us at September 30, 2012, assuming a triggering event had occurred under each of their respective agreements as of September 30, 2012 that did not also involve a change in control of Vitesse:
  Termination Without Change in Control
  Base Salary
Payment		 Bonus
Payment		 Continuation
of Benefits(4)		 Total
Payout
Christopher R. Gardner (1) $750,000
 $1,500,000
 $15,636
 $2,265,636
Martin S. McDermut (2) 285,000
 171,000
 —
 456,000
Martin C. Nuss (3) 235,000
 —
 —
 235,000
(1)  Base salary payment represents cash severance payments based on the executive’s salary at September 30, 2012, in an amount equal to two years of his base salary.  Bonus payment represents the sum of (i) two times his maximum bonus opportunity for fiscal year 2012 and (ii) one times his target bonus opportunity for fiscal year 2012.
(2)  Base salary payment represents cash severance payments based on the executive’s salary at September 30, 2012, in an amount equal to one year of his base salary.  Bonus payment represents the prorated sum of (i) one times his maximum bonus opportunity for fiscal year 2012 and (ii) one times his target bonus opportunity for fiscal year 2012.
(3)  Base salary payment represents cash severance payments based on the executive’s salary at September 30, 2012, in an amount equal to one year of this base salary.
(4)  Represents the aggregate amount of all premiums payable for the continuing of Mr. Yonker's outstandingthe executive’s health benefits for the applicable severance period, based on the amounts of such premiums at September 30, 2012.
With Change in Control
The following table sets forth severance payments and benefits that we would have been obligated to pay to the named executive officers who were employed by us at September 30, 2012, assuming a triggering event had occurred under each of their respective agreements as of September 30, 2012 in connection with a change in control of Vitesse:
  Termination With Change in Control
  Base Salary
Payment		 Bonus
Payment		 Continuation
of Benefits(4)		 Acceleration of
Vesting of Equity
Awards(5)		 Total
Payout
Christopher R. Gardner (1) $750,000
 $1,500,000
 $15,636
 $644,892
 $2,910,528
Martin S. McDermut (2) 285,000
 342,000
 36,168
 193,167
 856,335
Martin C. Nuss (3) 194,327
 176,250
 19,332
 172,181
 562,090
(1)  Base salary payment represents cash severance payments based on the executive’s salary at September 30, 2012, in an amount equal to two years of his base salary.  Bonus payment represents the sum of (i) two times his maximum bonus opportunity for fiscal year 2011 and (ii) one times his target bonus opportunity for fiscal year 2011.
(2)  Base salary payment represents cash severance payments based on the executive’s salary at September 30, 2012, in an amount equal to one year of his base salary.  Bonus payment represents the prorated sum of (i) one times his maximum bonus opportunity for fiscal year 2011 and (ii) one times his target bonus opportunity for fiscal year 2011.
(3)  Base salary payment represents cash severance payments based on the executive’s salary at September 30, 2012, in an amount equal to one year of this base salary.
(4)  Represents the aggregate amount of all premiums payable for the continuing of the executive’s health benefits for the applicable severance period, based on the amounts of such premiums at September 30, 2012.
(5)  Represents the value of accelerated “in the money” stock option awards were out-of-the-money. The vesting of 72,917 of Mr. Yonker'soptions and restricted stock units would be accelerated. Based onawards using the closing price of our Common Stock on September 30, 2012 of $2.44per shareshare.




Risk Assessment Regarding Compensation Policies and Practices
Our compensation program for employees does not create incentives for excessive risk taking by our employees or involve risks that are reasonably likely to have a material adverse effect on Vitesse. Our base salary component of compensation does not encourage risk-taking because it is a fixed amount. Our executive bonus plan for senior executives and our equity compensation awards have the following risk-limiting characteristics:
Cash awards to each executive officer are set in a market range and are limited by the terms of the Company'sexecutive bonus plan for senior executives to a fixed maximum specified in the plan;

Cash awards are made based on a review of a variety of indicators of performance, thus diversifying the risk associated with any single indicator of performance;

Neither cash nor equity awards are not tied to formulas that could focus executives on specific short-term outcomes;

Members of the Compensation Committee approve the final cash incentive awards made under the executive bonus plan for senior executives in their discretion, after the review of executive and corporate performance;

Members of the Compensation Committee approve all equity awards for senior executives in their discretion;

An equity award's value is delivered in the form of stock on September 30, 2009and options that vest over multiple years, which aligns the interests of $0.37,executive officers to long-term shareholder interests; and

Equity and cash awards, as well as profits realized upon the valuesale of such restricted stock units subject to accelerated vesting was $26,979.

        If Dr. Nuss' employmentour securities, may be recovered by us should a restatement of earnings occur upon which incentive compensation awards were to have been terminated on September 30, 2009based, or in the event of certain other wrong-doing by the Company other thanrecipient.


Cash awards are made based on a review of a variety of indicators of performance, thus diversifying the risk associated with any single indicator of performance;
Neither cash nor equity awards are not tied to formulas that could focus executives on specific short-term outcomes;
Members of the Compensation Committee approve the final cash incentive awards made under the executive bonus plan for cause or by Dr. Nuss within nine monthssenior executives in their discretion, after a Changethe review of executive and corporate performance;
Members of the Compensation Committee approve all equity awards for senior executives in Control resultingtheir discretion;
An equity awards value is delivered in a material change in his position, responsibilities, or compensation, he would have received a lump sum paymentthe form of $220,000.

        Upon termination, all namedstock and options that vest over multiple years, which aligns the interests of executive officers would also receive any vacation accruedto long-term shareholder interests; and unpaid

Equity and cash awards, as well as profits realized upon the sale of our securities, may be recovered by us should a restatement of earnings occur upon which incentive compensation awards were based, or in the dateevent of termination.

certain other wrong-doing by the recipient.


CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS

Review, Approval or Ratification of

Certain Relationships and Related Person Transactions

In accordance with the charter for the Audit Committee of theour Board, the members of the Audit Committee, all of whom are independent directors, review and approve in advance any proposed related person transactions. Additionally, from time to time thetime-to-time our Board may directly consider these transactions. We will report all such material related person transactions under applicable accounting rules and SEC rules and regulations. For purposes of these procedures, the individuals and entities that are considered "related persons"“related persons” include:

Any of our directors, nominees for director and executive officers;

•
Any person known to be the beneficial owner of five percent or more of our common stockCommon Stock (a "5% Stockholder"“5% Stockholder”); and

•
Any immediate family member, as defined in Item 404(a) of Regulation S-K, of a director, nominee for director, executive officer and 5% Stockholder. We will report all such material related person transactions under applicable accounting rules, federal securities laws and SEC rules and regulations.

Related Person Transactions

Certain Transactions with Related Persons

        We are currently a party to a consulting agreement with Lynn Jones, who shares a household with Mr. Gardner, our Chief Executive Officer and a director. Ms. Jones was previously employed with the Company as a paralegal from September 2000 until July 2006. She was asked to assist the Company in fiscal year 2009 because of her experience and her knowledge of the Company, as well as the increasing demands placed on the Company's legal resources as a result of the imminent debt restructuring that was completed on October 30, 2009. From October 1, 2008 through December 31, 2009, we paid Ms. Jones an aggregate of $137,086 in cash compensation, at a rate of $80.00 per hour, pursuant to the consulting agreement for her services as a legal consultant. Ms. Jones' consulting relationship was approved by the Board of Directors which received full disclosure of Mr. Gardner's relationship to Ms. Jones.




The charter of our Board's Audit Committee provides that the Audit Committee is responsible for reviewing, in consultation with our General Counsel,counsel, reports and disclosures of insider and affiliated party transactions and compliance with our policy and procedures with respect to related party transactions. Our policies and procedures regarding related party transactions are evidenced in writing



by our Code of Business Conduct and Ethics, which we refer to as our Employees' Code, and our Code of Business Conduct and Ethics for Members of the Board of Directors, which we refer to as our Directors' Code.Ethics. The Employees' Code requires all directors, officers and employees to discharge their responsibilities solely on the basis of the Company's best interests, independent of personal interests, considerations or relationships. This codeThe Code also requires anyone who personally becomes involved in a situation that gives rise to an actual or potential conflict of interest to immediately notify our General Counsel.Human Resources department. The Directors' Code requires members of our Board to take all reasonable steps to avoid conflicts of interest with the Company. Additionally, the Directors' Code requires members of our Board to promptly disclose to the Chairperson of our Nominating and Corporate Governance Committee any situation that involves, or may reasonably be expected to involve, a conflict of interest with the Company. The charter of our Board's Nominating and Corporate Governance Committee provides that this committee will review potential conflicts of interest involving members of our Board and will determine whether such director or directors may vote on any issue as to which there may be a conflict.

Directors' Independence

        Except for Christopher R. Gardner, our President, Chief Executive Officer,

Reportable Related Person Transactions
Since October 1, 2011, there has not been, nor is there currently proposed, any transaction or series of similar transactions to which we were or will be a party, in which the amount involved exceeds $120,000 and in which any related person had or will have a director, all of our directors meet the independence requirements set forth in the NASDAQ Listing Rules and our Corporate Governance Guidelines. The members of our Audit Committee also meet the additional independence requirements set forth in the NASDAQ Listing Rules and the SEC rules for Audit Committee members.

direct or indirect material interest.





REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

The Audit Committee is responsible for overseeing our accountingReport does not constitute soliciting materials and financial reporting processes and auditsshall not be deemed filed or incorporated by reference into any other filings by us under the Securities Act of our financial statements. As set forth in its charter,1933 or the Exchange Act, except to the extent we specifically incorporate this Audit Committee acts only in an oversight capacity and relies on the work and assurances of both management, which has primary responsibilities for our financial statements and reports, as well as the independent registered public accounting firm that is responsible for expressing an opinion on the conformity of our audited financial statements to generally accepted accounting principles.

Report by reference therein.

The Audit Committee met sixteen (16) times either in person or by telephone during fiscal year 2009. In the course of these meetings, the Audit Committee met with management and our independent auditors and reviewed the results of the audit examinations, evaluations of our internal controls and the overall quality of our financial reporting.

        The Audit Committee believes that a candid, substantive and focused dialogue with the independent registered public accounting firm is fundamental to the Audit Committee's oversight responsibilities. To support this belief, the Audit Committee periodically meets separately with the independent auditors, without management present. In the course of its discussions in these meetings, the Audit Committee asked a number of questions intended to bring to light any areas of potential concern related to our financial reporting and internal controls. These questions include:

        The Audit Committee approved the engagement of BDO Seidman, LLPhereby reports as our independent registered public accounting firm for fiscal year 2009 and reviewed with the independent registered public accounting firm their respective overall audit scope and plans. In approving BDO Seidman, LLP, the Audit Committee considered the qualifications of BDO Seidman, LLP and discussed with BDO Seidman, LLP their independence, including a review of the audit and non-audit services provided by them to us. The Audit Committee also discussed with BDO Seidman, LLP the matters required to be discussed by Statement on Auditing Standards No. 61, as amended, (AICPA,Professional Standards, Vol. 1 AU section 380), as adopted by the Public Company Accounting Oversight Board in Rule 3200T, and it received the written disclosures and the letter from BDO Seidman, LLP required by the applicable requirements of the Public Company Accounting Oversight Board regarding BDO Seidman, LLP's communications with Audit Committee concerning independence and has discussed BDO Seidman, LLP's independence with BDO Seidman, LLP.

        Management has reviewed the audited financial statements for fiscal year 2009 with the Audit Committee, including a discussion of the quality and acceptability of the financial reporting, the reasonableness of significant accounting judgments and estimates and the clarity of disclosures in the financial statements. In connection with this review and discussion, the Audit Committee asked a number of follow-up questions of management and the independent registered public accounting firm to help give the Audit Committee comfort in connection with its review.

follows:
1.
Management has primary responsibility for the accuracy and fairness of the Company's consolidated financial statements as well as the processes employed to prepare the financial statements, and the system of internal control over financial reporting.

        In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board (and the Board has approved) that the audited financial statements be included in the annual report on Form 10-K for the fiscal year ended September 30, 2009, for filing with the SEC.

2.The Audit Committee represents the Board of Directors in discharging its responsibilities relating to the Company's accounting, financial reporting, financial practices, and system of internal controls. As part of its oversight role, the Audit Committee has reviewed and discussed with Company's management the Company's audited consolidated financial statements included in its Annual Report on Form 10-K for the fiscal year ended September 30, 2012.


3.
The Audit Committee has discussed with the Company's independent registered public accounting firm, BDO USA, LLP, the overall scope of and plans for their audit. The Audit Committee has met with and without management present, to discuss the Company's financial reporting processes and system of internal control over financial reporting in addition to those matters required to be discussed by Statement on Auditing Standards No. 61 as amended (AICPA, Professional Standards, Vol. I AU section 380), as adopted by the Public Company Accounting Oversight Board (“PCAOB”) in Rule 3200T.

4.The Audit Committee has received the written disclosures and the letter from BDO USA, LLP required by applicable requirements of the PCAOB regarding the independent accountant's communications with the Audit Committee concerning independence, and has discussed with BDO USA, LLP their independence.

5.Based on the review and discussions referred to in paragraphs (1) through (4) above, the Audit Committee recommended to the Board of Directors and the Board of Directors has approved the inclusion of the audited financial statements in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2012, for filing with SEC.



Respectfully submitted by
 Respectively submitted by
THE AUDIT COMMITTEE

 
 

James H. Hugar, Chair
SteveChairman
Steven P. Hanson
Scot B. Jarvis
Edward Rogas, Jr.




OTHER MATTERS

We know of no other matters to be submitted to the meeting. If any other matters properly come before the meeting, it is the intention of the persons named in the enclosed form Proxyproxy to vote the shares they represent as the Board may recommend.



By Order of the Board of Directors,
  BY ORDER OF THE BOARD OF DIRECTORS

Dated: March 31, 2010Camarillo, California

GRAPHIC

Christopher R. Gardner
January 15, 2013President and Chief Executive Officer



APPENDIX

ANNEX A

VITESSE SEMICONDUCTOR CORPORATION


2010
2013 INCENTIVE PLAN


SECTION 1. PURPOSE

The purpose of the Vitesse Semiconductor Corporation 20102013 Incentive Plan is to attract, retain and motivate employees, officers, directors, consultants, agents, advisors and independent contractors of the Company and its Related Companies by providing them the opportunity to acquire a proprietary interest in the Company and to align their interests and efforts to the long-term interests of the Company's stockholders.


SECTION 2. DEFINITIONS

Certain capitalized terms used in the Plan have the meanings set forth in Appendix A.


SECTION 3. ADMINISTRATION

3.1Administration of the Plan

(a)    The Plan shall be administered by the Board or the Compensation Committee, which shall be composed of two or more directors, each of whom is a "non-employee director"“non-employee director” within the meaning of Rule 16b-3(b)(3) promulgated under the Exchange Act, or any successor definition adopted by the Securities and Exchange Commission, , and an "outside director"“outside director” within the meaning of Section 162(m) of the Code, or any successor provision thereto.

(b)    Notwithstanding the foregoing, the Board may delegate concurrent responsibility for administering the Plan, including with respect to designated classes of Eligible Persons, to different committees consisting of one or more members of the Board, subject to such limitations as the Board deems appropriate, except with respect to Awards to Participants who are subject to Section 16 of the Exchange Act or Awards granted pursuant to Section 16 of the Plan. Members of any committee shall serve for such term as the Board may determine, subject to removal by the Board at any time. To the extent consistent with applicable law, the Board or the Compensation Committee may authorize one or more officers of the Company to grant Awards to designated classes of Eligible Persons, within limits specifically prescribed by the Board or the Compensation Committee; provided, however, that no such officer shall have or obtain authority to grant Awards to himself or herself or to any person subject to Section 16 of the Exchange Act.

(c)    All references in the Plan to the "Committee"“Committee” shall be, as applicable, to the Board, the Compensation Committee or any other committee or any officer to whom authority has been delegated to administer the Plan.

3.2Administration and Interpretation by Committee

(a)    Except for the terms and conditions explicitly set forth in the Plan and to the extent permitted by applicable law, the Committee shall have full power and exclusive authority, subject to such orders or resolutions not inconsistent with the provisions of the Plan as may from time to time be adopted by the Board or a Committee composed of members of the Board, to (i) select the Eligible Persons to whom Awards may from time to time be granted under the Plan; (ii) determine the type or types of Award to be granted to each Participant under the Plan; (iii) determine the number of shares of Common Stock to be covered by each Award granted under the Plan; (iv) determine the terms and conditions of any Award granted under the Plan; (v) approve the forms of notice or agreement for use under the Plan; (vi) determine whether, to what extent and under what circumstances Awards may be settled in cash, shares of Common Stock or other property or canceled or suspended; (vii) interpret



and administer the Plan and any instrument evidencing an Award, notice or agreement executed or entered into under the Plan; (viii) establish such rules and regulations as it shall deem appropriate for the proper administration of the Plan; (ix) delegate ministerial duties to such of the Company's employees as it so determines; and (x) make any other determination and take any other action that the Committee deems necessary or desirable for administration of the Plan.

(b)    In no event, however, shall the Committee have the right, without stockholder approval, to (i) lower the price of an option after it is granted, except in connection with adjustments provided in Section 15.1;15.1; (ii) take any other action that is treated as a repricing under generally accepted accounting principles; or (iii) cancel an option at a time when its strike price exceeds the fair market value of the underlying stock, in exchange for another option, restricted stock, or other equity, unless the cancellation and exchange occurs in connection with a merger, acquisition, spin-off or other similar corporate transaction.



(c)    The effect on the vesting of an Award of a Company-approved leave of absence or a Participant's reduction in hours of employment or service shall be determined by the Company's chief human resources officer or other person performing that function or, with respect to directors or executive officers, by the Compensation Committee, whose determination shall be final.

(d)    Decisions of the Committee shall be final, conclusive and binding on all persons, including the Company, any Participant, any stockholder and any Eligible Person. A majority of the members of the Committee may determine its actions.


SECTION 4. SHARES SUBJECT TO THE PLAN

4.1Authorized Number of Shares

and Share Usage

(a)    50,000,000 shares; plus

        (b)   up to 40,457,825 shares subject to outstanding awards under the Company's 2001 Stock Incentive Plan (the "Prior Plan") on the Effective Date that cease to be subject to such awards (other than by reason of exercise or settlement of the awards to the extent they are exercised for or settled in shares) subjectSubject to adjustment from time to time as provided in this Section 4.1 and in Section 15.1 which shares shall cease, as, a total of such date, to be available for grant and issuance under the Prior Plan and shall instead be available for issuance under the Plan.

        (c)   Shares issued under the Plan shall be drawn from authorized and unissued shares or shares now held or subsequently acquired by the Company as treasury shares.

4.2    Share Usage

        (a)   Shares of Common Stock covered by an Award shall not be counted as used unless and until they are actually issued and delivered to a Participant. If any Award lapses, expires, terminates or is canceled prior to the issuance of shares thereunder or if6,700,000 shares of Common Stock are issuedshall be authorized for issuance pursuant to Awards granted under the Plan. No further grants may be made under the Prior Plans after the Effective Date, but shares subject to awards granted under the Prior Plans may become again available for Awards under the Plan, in addition to the number of shares specified immediately above, pursuant to Section 4.1(c) below. Any shares that are subject to Awards of Options or Stock Appreciation Rights shall be counted against the Plan's share limit as one (1) share for every one (1) share granted. Any shares that are subject to Awards other than Options or Stock Appreciation Rights shall be counted against the Plan's share limit as one and five-tenths (1.5) shares for every one (1) share granted. Any shares that are subject to Awards granted under the Plan, and any shares that are subject to awards granted under the Prior Plans, that again become available for the grant of Awards under the Plan as provided in Section 4.1(c) below, shall increase the Plan's share limit as follows: (i) any such shares that are subject to Awards of Options or Stock Appreciation Rights, and any such shares that are subject to awards of options or stock appreciation rights granted under the Prior Plans, shall increase the Plan's share limit on a Participantone (1) for one (1) basis; and thereafter(ii) any such shares that are subject to Awards other than Options or Stock Appreciation Rights, and any such shares that are subject to awards other than options or stock appreciation rights granted under the Prior Plans, shall increase the Plan's share limit on a one and five-tenths (1.5) for one (1) basis.

(b)    Notwithstanding the other provisions in this Section 4 to the contrary, the maximum number of shares that may be issued upon the exercise of Incentive Stock Options shall equal the aggregate share number stated in Section 4.1(a), subject to adjustment as provided in Section 15.1.
(c)    If any Award granted under the Plan or any award granted under the Prior Plans expires or is terminated, surrendered or canceled without having been fully exercised, is forfeited toin whole or otherwise reacquired by the Company, thein part (including as a result of shares subject to such Awards andAward or award under the forfeitedPrior Plans being repurchased by the Company at the original issuance price pursuant to a contractual repurchase right), is settled in cash or reacquiredotherwise results in any shares not being issued, the unused shares covered by such Award or award under the Prior Plans shall again be available for issuancethe grant of Awards under the Plan. AnyPlan, and shall be added back to the Plan's share limit in the manner provided in Section 4.1(a); provided, however, that (i) shares of Common Stock (i) tendereddelivered (either by actual delivery or attestation) to the Company by a Participant to satisfy any applicable tax withholding obligation with respect to Awards other than Options, Stock Appreciation Rights and options and stock appreciation rights granted under the Prior Plans (including shares retained from such Award or award under the Prior Plans creating the tax obligation) shall be added to the number of shares available for the grant of Awards under the Plan; (ii) shares delivered (either by actual delivery, attestation or net exercise) to the Company by a Participant to exercise an Option, Stock Appreciation Right or option or stock appreciation right granted under the Prior Plans or to satisfy any applicable tax withholding obligation on an Option, Stock Appreciation Right or option or stock appreciation right granted under the Prior Plans (including shares retained from the Option, Stock Appreciation Right or option or stock appreciation right granted under the Prior Plans creating the tax obligation) shall not be so added to the number of shares available for the grant of Awards under the Plan; and (iii) shares repurchased by the Company as full or partial payment toon the Company foropen market using the purchase priceproceeds from the exercise of an Award or to satisfy tax withholding obligations in connection with an Award, or (ii) covered by an Award that is settled in cash, or in a manner such that some or allaward granted under the Prior Plans shall not increase the number of the shares of Common Stock covered by the Award are not issued, shall be available for Awards under the Plan.future grant of Awards. The number of shares of Common Stock available for issuance under the Plan shall not be reduced to reflect any dividends or dividend equivalents that are reinvested into additional shares of Common Stock or credited as additional shares of Common Stock subject or paid with respect to an Award.

Award or an award under the Prior Plans.

        (b)   The Committee(d)    In the case of freestanding Stock Appreciation Rights (as defined in Section 9.1), the full number of shares subject to such Stock Appreciation Right, if settled in stock, shall also, without limitation, havebe counted against the authorityshares available under the Plan in proportion to grant Awards as an alternative to or as the form of payment for grants or rights earned or due under other compensation plans or arrangementsportion of the Company.

        (c)   Notwithstanding any other provisionfreestanding Stock Appreciation Right exercised, regardless of the Plannumber of shares actually used to the contrary, the Committee may grantsettle such freestanding Stock Appreciation Right upon exercise.

(e)    Substitute Awards may be granted under the Plan. Substitute AwardsPlan and any such grants shall not reduce the number of shares authorized for issuancegrant under the Plan.Plan or authorized for grant to a Participant in any calendar year. In the event that an Acquired Entity has shares available for awards or grants under one or more preexisting plans not adopted in contemplation of such acquisition or combination, then, to the extent determined by the Board or the Compensation Committee, the shares available for grant pursuant to the terms of such preexisting plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or


formula used in such acquisition or combination to determine the consideration payable to holders of common stock of the entities that are parties to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the number of shares of Common Stock authorized for issuance under the Plan; provided, however, that Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of such preexisting plans, absent the acquisition or combination, and shall only be made to individuals who were not employees or directors of the Company or a Related Company prior to such acquisition or combination. In the event that a written agreement between the Company and an Acquired Entity pursuant to which a merger or consolidation is completed is approved by the Board and that agreement sets forth the terms and conditions of the substitution for or assumption of outstanding awards of the Acquired Entity, those terms and conditions shall be deemed to be the action of the Committee without any further action by the Committee, except as may be required for compliance with Rule 16b-3 under the Exchange Act, and the persons holding such awards shall be deemed to be Participants.

        (d)   Notwithstanding

(f)    The Committee shall also, without limitation, have the authority to grant Awards as an alternative to or as the form of payment for grants or rights earned or due under other provisions in this Section 4.2 tocompensation plans or arrangements of the contrary,Company.
(g)    Shares issued under the maximum number ofPlan shall be drawn from authorized and unissued shares that may be issued uponor shares now held or subsequently acquired by the exercise of Incentive Stock Options shall equal the aggregate share number stated in Section 4.1, subject to adjustmentCompany as provided in Section 15.1.


treasury shares.

SECTION 5. ELIGIBILITY

An Award may be granted to any employee, officer or director of the Company or a Related Company whom the Committee from time to time selects. An Award may also be granted to any consultant, agent, advisor or independent contractor for bona fide services rendered to the Company or any Related Company that (a) are not in connection with the offer and sale of the Company's securities in a capital-raising transaction and (b) do not directly or indirectly promote or maintain a market for the Company's securities.


SECTION 6. AWARDS

6.1Form, Grant and Settlement of Awards

The Committee shall have the authority, in its sole discretion, to determine the type or types of Awards to be granted under the Plan. Such Awards may be granted either alone or in addition to or in tandem with any other type of Award. Any Award settlement may be subject to such conditions, restrictions and contingencies as the Committee shall determine.

6.2Evidence of Awards

Awards granted under the Plan shall be evidenced by a written, including an electronic, instrument that shall contain such terms, conditions, limitations and restrictions as the Committee shall deem advisable and that are not inconsistent with the Plan.


6.3Dividends and Distributions

Participants may, if the Committee so determines, be credited with dividends paid with respect to shares of Common Stock underlying an Award in a manner determined by the Committee in its sole discretion. The Committee may apply any restrictions to the dividends or dividend equivalents that the Committee deems appropriate. The Committee, in its sole discretion, may determine the form of payment of dividends or dividend equivalents, including cash, shares of Common Stock, Restricted Stock or Stock Units. Notwithstanding the foregoing, the right to any dividends or dividend equivalents declared and paid on the number of shares underlying an Option or a Stock Appreciation Right may not be contingent, directly or indirectly on the exercise of the Option or Stock Appreciation Right, and must comply with or qualify for an exemption under Section 409A. Also notwithstanding the foregoing, the right to any dividends or dividend equivalents declared and paid on Restricted Stock must (i) be paid at the same time they are paid to other shareholders and (ii) comply with or qualify for an exemption under Section 409A.


SECTION 7. OPTIONS

7.1Grant of Options

The Committee may grant Options designated as Incentive Stock Options or Nonqualified Stock Options.

7.2Option Exercise Price

Options shall be granted with an exercise price per share not less than 100% of the Fair Market Value of the Common Stock on the Grant Date (and shall not be less than the minimum exercise price required by Section 422 of the Code with respect to Incentive Stock Options), except in the case of Substitute Awards.

7.3Term of Options

Subject to earlier termination in accordance with the terms of the Plan and the instrument evidencing the Option, the maximum term of an Option shall be ten years from the Grant Date. For Incentive Stock Options, the maximum term of such an Option Term shall be as specifiedcomply in all respects with Section 8.4.

422 of the Code, or any successor provision, and any applicable regulations thereunder.



7.4Exercise of Options

(a)    The Committee shall establish and set forth in each instrument that evidences an Option the time at which, or the installments in which, the Option shall vest and become exercisable, any of which provisions may be waived or modified by the Committee at any time.

(b)    To the extent an Option has vested and become exercisable, the Option may be exercised in whole or from time to time in part by delivery to or as directed or approved by the Company of a properly executed stock option exercise agreement or notice, in a form and in accordance with procedures established by the Committee, setting forth the number of shares with respect to which the Option is being exercised, the restrictions imposed on the shares purchased under such exercise agreement or notice, if any, and such representations and agreements as may be required by the Committee, accompanied by payment in full as described in Sections 7.5.Section 7.5. An Option may be exercised only for whole shares and may not be exercised for less than a reasonable number of shares at any one time, as determined by the Committee.

7.5Payment of Exercise Price

The exercise price for shares purchased under an Option shall be paid in full to the Company by delivery of consideration equal to the product of the Option exercise price and the number of shares



purchased. Such consideration must be paid before the Company will issue the shares being purchased and must be in a form or a combination of forms acceptable to the Committee for that purchase, which forms may include:

(a)    cash;

(b)    check or wire transfer;

(c)    having the Company withhold shares of Common Stock that would otherwise be issued on exercise of the Option that have an aggregate Fair Market Value equal to the aggregate exercise price of the shares being purchased under the Option;

(d)    tendering (either actually or, so long as the Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act, by attestation) shares of Common Stock owned by the Participant that have an aggregate Fair Market Value equal to the aggregate exercise price of the shares being purchased under the Option;

(e)    so long as the Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act, and to the extent permitted by law, delivery of a properly executed exercise agreement or notice, together with irrevocable instructions to a brokerage firm designated or approved by the Company to deliver promptly to the Company the aggregate amount of proceeds to pay the Option exercise price and any withholding tax obligations that may arise in connection with the exercise, all in accordance with the regulations of the Federal Reserve Board; or

(f)    such other consideration as the Committee may permit.

7.6Effect of Termination of Service

(a)    The Committee shall establish and set forth in each instrument that evidences an Option whether the Option shall continue to be exercisable, and the terms and conditions of such exercise, after a Termination of Service, any of which provisions may be waived or modified by the Committee at any time.

(b)    If the exercise of the Option following a Participant's Termination of Service, but while the Option is otherwise exercisable, would be prohibited solely because the issuance of Common Stock would violate the registration requirements under the Securities Act or similar requirements under the laws of any state or foreign jurisdiction, then the Option shall remain exercisable until the earlier of (a)the Option Expiration Date and (b) the expiration of a period of three months (or such longer period of time as determined by the Committee in its sole discretion) after the Participant's Termination of Service during which the exercise of the Option would not be in violation of such Securities Act or other requirements.


SECTION 8. INCENTIVE STOCK OPTION LIMITATIONS

Notwithstanding any other provision of the Plan to the contrary, the terms and conditions of any Incentive Stock Options shall in addition comply in all respects with Section 422 of the Code, or any successor provision, and any applicable regulations thereunder.


SECTION 9. STOCK APPRECIATION RIGHTS

9.1Grant of Stock Appreciation Rights

The Committee may grant Stock Appreciation Rights to Participants at any time on such terms and conditions as the Committee shall determine in its sole discretion. An SAR may be granted in tandem with an Option or alone ("freestanding"(“freestanding”). The grant price of a tandem SAR shall be equal to the exercise price of the related Option. The grant price of a freestanding SAR shall be established in



accordance with procedures for Options set forth in Section 7.2.7.2. An SAR may be exercised upon such terms and conditions and for the term as the Committee determines in its sole discretion; provided, however, that, subject to earlier termination in accordance with the terms of the Plan and the instrument evidencing the SAR, the maximum term of a freestanding SAR shall be ten years, and in the case of a tandem SAR, (a) the term shall not exceed the term of the related Option and (b) the tandem SAR may be



exercised for all or part of the shares subject to the related Option upon the surrender of the right to exercise the equivalent portion of the related Option, except that the tandem SAR may be exercised only with respect to the shares for which its related Option is then exercisable.

9.2Payment of SAR Amount

Upon the exercise of an SAR, a Participant shall be entitled to receive payment in an amount determined by multiplying: (a) the difference between the Fair Market Value of the Common Stock on the date of exercise over the grant price of the SAR by (b) the number of shares with respect to which the SAR is exercised. At the discretion of the Committee as set forth in the instrument evidencing the Award, the payment upon exercise of an SAR may be in cash, in shares, in some combination thereof or in any other manner approved by the Committee in its sole discretion.

9.3Waiver of Restrictions

The Committee, in its sole discretion, may waive any other terms, conditions or restrictions on any SAR under such circumstances and subject to such terms and conditions as the Committee shall deem appropriate.


SECTION 10. STOCK AWARDS,
RESTRICTED STOCK AND STOCK UNITS

10.1Grant of Stock Awards, Restricted Stock and Stock Units

The Committee may grant Stock Awards, Restricted Stock and Stock Units on such terms and conditions and subject to such repurchase or forfeiture restrictions, if any, which may be based on continuous service with the Company or a Related Company or the achievement of any performance goals, as the Committee shall determine in its sole discretion, which terms, conditions and restrictions shall be set forth in the instrument evidencing the Award.

10.2Vesting of Restricted Stock and Stock Units

Upon the satisfaction of any terms, conditions and restrictions prescribed with respect to Restricted Stock or Stock Units, or upon a Participant's release from any terms, conditions and restrictions of Restricted Stock or Stock Units, as determined by the Committee (a) the shares of Restricted Stock covered by each Award of Restricted Stock shall become freely transferable by the Participant, and (b) Stock Units shall be paid in shares of Common Stock or, if set forth in the instrument evidencing the Awards, in cash or a combination of cash and shares of Common Stock. Any fractional shares subject to such Awards shall be paid to the Participant in cash.

10.3Waiver of Restrictions

The Committee, in its sole discretion, may waive the repurchase or forfeiture period and any other terms, conditions or restrictions on any Restricted Stock or Stock Unit under such circumstances and subject to such terms and conditions as the Committee shall deem appropriate.



SECTION 11. PERFORMANCE AWARDS

11.1Performance Shares

The Committee may grant Awards of Performance Shares, designate the Participants to whom Performance Shares are to be awarded and determine the number of Performance Shares and the terms and conditions of each such Award. Performance Shares shall consist of a unit valued by reference to a designated number of shares of Common Stock, the value of which may be paid to the Participant by delivery of shares of Common Stock or, if set forth in the instrument evidencing the Award, of such property as the Committee shall determine, including, without limitation, cash, shares of Common Stock, other property, or any combination thereof, upon the attainment of performance goals, as established by the Committee, and other terms and conditions specified by the Committee. The amount to be paid under an Award of Performance Shares may be adjusted on the basis of such further consideration as the Committee shall determine in its sole discretion.

11.2Performance Units

The Committee may grant Awards of Performance Units, designate the Participants to whom Performance Units are to be awarded and determine the number of Performance Units and the terms and conditions of each such Award. Performance Units shall consist of a unit valued by reference to a designated amount of property other than shares of Common Stock, which value may be paid to the Participant by delivery of such property as the Committee shall determine, including, without limitation, cash, shares of Common Stock, other property, or any combination thereof, upon the attainment of performance goals, as established by the Committee, and other terms and conditions specified by the Committee. The amount to be paid under an Award of Performance Units may be adjusted on the basis of such further consideration as the Committee shall determine in its sole discretion.





SECTION 12. OTHER STOCK OR CASH-BASED AWARDS

Subject to the terms of the Plan and such other terms and conditions as the Committee deems appropriate, the Committee may grant other incentives payable in cash or in shares of Common Stock under the Plan.


SECTION 13. WITHHOLDING

13.1Payment of Tax Withholding and Other Obligations

The Company may require the Participant to pay to the Company the amount of (a) any taxes that the Company is required by applicable federal, state, local or foreign law to withhold with respect to the grant, vesting or exercise of an Award ("(“tax withholding obligations"obligations”) and (b) any amounts due from the Participant to the Company or to any Related Company ("(“other obligations"obligations”). Notwithstanding any other provision of the Plan to the contrary, the Company shall not be required to issue any shares of Common Stock or otherwise settle an Award under the Plan until such tax withholding obligations and other obligations are satisfied.

13.2Payment Methods

The Committee, in its sole discretion, may permit or require a Participant to satisfy all or part of the Participant's tax withholding obligations and other obligations by (a) paying cash to the Company, (b) having the Company withhold an amount from any cash amounts otherwise due or to become due from the Company to the Participant, (c) having the Company withhold a number of shares of Common Stock that would otherwise be issued to the Participant (or become vested, in the case of Restricted Stock) having a Fair Market Value equal to the tax withholding obligations and other obligations, (d) surrendering a number of shares of Common Stock the Participant already owns having



a value equal to the tax withholding obligations and other obligations, (e) selling shares of Common Stock issued under an Award on the open market or to the Company, or (f) taking such other action as may be necessary in the opinion of the Committee to satisfy any applicable tax withholding obligations. The value of the shares so withheld or tendered may not exceed the employer's applicable minimum required tax withholding rate or such other applicable rate as is necessary to avoid adverse treatment for financial accounting purposes, as determined by the Committee in its sole discretion.


SECTION 14. ASSIGNABILITY

No Award or interest in an Award may be sold, assigned, pledged (as collateral for a loan or as security for the performance of an obligation or for any other purpose) or transferred by a Participant or made subject to attachment or similar proceedings otherwise than by will or by the applicable laws of descent and distribution, except to the extent the Participant designates one or more beneficiaries on a Company-approved form who may exercise the Award or receive payment under the Award after the Participant's death. During a Participant's lifetime, an Award may be exercised only by the Participant. Notwithstanding the foregoing and to the extent permitted by Section 422 of the Code, the Committee, in its sole discretion, may permit a Participant to assign or transfer an Award subject to such terms and conditions as the Committee shall specify.


SECTION 15. ADJUSTMENTS

15.1Adjustment of Shares

(a)    In the event, at any time or from time to time, a stock dividend, stock split, spin-off, combination or exchange of shares, recapitalization, merger, consolidation, distribution to stockholders other than a normal cash dividend, or other change in the Company's corporate or capital structure results in (a) the outstanding shares of Common Stock, or any securities exchanged therefor or received in their place, being exchanged for a different number or kind of securities of the Company or (b) new, different or additional securities of the Company or any other company being received by the holders of shares of Common Stock, then the Committee shall make proportional adjustments in (i) the maximum number and kind of securities available for issuance under the Plan; (ii) the maximum number and kind of securities issuable as Incentive Stock Options as set forth in Section 4.2;4.1; (iii) the maximum number and kind of securities set forth in Section 4.3; (iv) the maximum numbers and kind of securities set forth in Section 16.3;16.3; and (v)(iv) the number and kind of securities that are subject to any outstanding Award and the per share price of such securities, without any change in the aggregate price to be paid therefor. The determination by the Committee, as to the terms of any of the foregoing adjustments shall be conclusive and binding.

(b)    Notwithstanding the foregoing, the issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, for cash or property, or for labor or services rendered, either upon direct sale or upon the exercise of rights or warrants to subscribe therefor, or upon conversion of shares or obligations of the Company convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, outstanding Awards. Also notwithstanding the foregoing, a dissolution or liquidation of the Company or a Company Transaction shall not be governed by this Section 15.1 but shall be governed by Sections 15.2 and 15.3, respectively.

15.2 and 15.3, respectively.

15.2Dissolution or Liquidation

To the extent not previously exercised or settled, and unless otherwise determined by the Committee in its sole discretion, Awards shall terminate immediately prior to the dissolution or liquidation of the Company. To the extent a vesting condition, forfeiture provision or repurchase right



applicable to an Award has not been waived by the Committee, the Award shall be forfeited immediately prior to the consummation of the dissolution or liquidation.





15.3Change in Control

Notwithstanding any other provision of the Plan to the contrary, unless the Committee shall determine otherwise in the instrument evidencing the Award or in a written employment, services or other agreement between the Participant and the Company or a Related Company, in the event of a Change in Control:

(a)    All outstanding Awards, other than Performance Shares and Performance Units, shall become fully and immediately exercisable, and all applicable restrictions or forfeiture provisions shall lapse, immediately prior to the Change in Control and shall terminate at the effective time of the Change in Control; provided, however, that with respect to a Change in Control that is a Company Transaction in which such Awards could be converted, assumed or replaced by the Successor Company, such Awards shall become fully and immediately exercisable, and all applicable restrictions or forfeiture provisions shall lapse, only if and to the extent such Awards are not converted, assumed or replaced by the Successor Company.

For the purposes of this Section 15.3(a), an Award shall be considered converted, assumed or replaced by the Successor Company if following the Company Transaction the option or right confers the right to purchase or receive, for each share of Common Stock subject to the Award immediately prior to the Company Transaction, the consideration (whether stock, cash or other securities or property) received in the Company Transaction by holders of Common Stock for each share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares); provided, however, that if such consideration received in the Company Transaction is not solely common stock of the Successor Company, the Committee may, with the consent of the Successor Company, provide for the consideration to be received pursuant to the Award, for each share of Common Stock subject thereto, to be solely common stock of the Successor Company substantially equal in fair market value to the per share consideration received by holders of Common Stock in the Company Transaction. The determination of such substantial equality of value of consideration shall be made by the Committee, and its determination shall be conclusive and binding.

(b)    All Performance Shares or Performance Units earned and outstanding as of the date the Change in Control is determined to have occurred and for which the payout level has been determined shall be payable in full in accordance with the payout schedule pursuant to the instrument evidencing the Award. Any remaining Performance Shares or Performance Units (including any applicable performance period) for which the payout level has not been determined shall be prorated at the target payout level up to and including the date of such Change in Control and shall be payable in accordance with the payout schedule pursuant to the instrument evidencing the Award. Any existing deferrals or other restrictions not waived by the Committee in its sole discretion shall remain in effect.

(c)    Notwithstanding the foregoing, the Committee, in its sole discretion, may instead provide in the event of a Change in Control that is a Company Transaction that a Participant's outstanding Awards shall terminate upon or immediately prior to such Company Transaction and that such Participant shall receive, in exchange therefor, a cash payment equal to the amount (if any) by which (x) the value of the per share consideration received by holders of Common Stock in the Company Transaction, or, in the event the Company Transaction is one of the transactions listed under subsection (c) in the definition of Company Transaction or otherwise does not result in direct receipt of consideration by holders of Common Stock, the value of the deemed per share consideration received, in each case as determined by the Committee in its sole discretion, multiplied by the number of shares of Common Stock subject to such outstanding Awards (whether or not then vested and exercisable) exceeds (y) if applicable, the respective aggregate exercise price or grant price for such Awards.


15.4Further Adjustment of Awards

Subject to Sections 15.2 and 15.3, the Committee shall have the discretion, exercisable at any time before a sale, merger, consolidation, reorganization, liquidation, dissolution or change of control of the Company, as defined by the Committee, to take such further action as it determines to be necessary or advisable with respect to Awards. Such authorized action may include (but shall not be limited to) establishing, amending or waiving the type, terms, conditions or duration of, or restrictions on, Awards so as to provide for earlier, later, extended or additional time for exercise, lifting restrictions and other modifications, and the Committee may take such actions with respect to all Participants, to certain categories of Participants or only to individual Participants. The Committee may take such action before or after granting Awards to which the action relates and before or after any public announcement with respect to such sale, merger, consolidation, reorganization, liquidation, dissolution or change of control that is the reason for such action.

15.5No Limitations

The grant of Awards shall in no way affect the Company's right to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.




15.6Fractional Shares

In the event of any adjustment in the number of shares covered by any Award, each such Award shall cover only the number of full shares resulting from such adjustment.

15.7Section 409A

Notwithstanding any other provision of the Plan to the contrary, (a) any adjustments made pursuant to this Section 15 to Awards that are considered "deferred compensation"“deferred compensation” within the meaning of Section 409A shall be made in compliance with the requirements of Section 409A and (b) any adjustments made pursuant to this Section 15 to Awards that are not considered "deferred compensation"“deferred compensation” subject to Section 409A shall be made in such a manner as to ensure that after such adjustment the Awards either (i) continue not to be subject to Section 409A or (ii) comply with the requirements of Section 409A.


SECTION 16. CODE SECTION 162(m) PROVISIONS

Notwithstanding any other provision of the Plan to the contrary, if the Committee determines, at the time Awards are granted to a Participant who is, or is likely to be as of the end of the tax year in which the Company would claim a tax deduction in connection with such Award, a Covered Employee, then the Committee may provide that this Section 16 is applicable to such Award.

16.1Performance Criteria

(a)    If an Award is subject to this Section 16, then the lapsing of restrictions thereon and the distribution of cash, shares of Common Stock or other property pursuant thereto, as applicable, shall be subject to the achievement of one or more objective performance goals established by the Committee, which shall be based on the attainment of specified levels of one of or any combination of the following "performance criteria"“performance criteria” for the Company as a whole or any business unit of the Company, as reported or calculated by the Company: cash flows (including, but not limited to, operating cash flow, free cash flow or cash flow return on capital); working capital; earnings per share; book value per share; operating income (including or excluding depreciation, amortization, extraordinary items, restructuring charges or other expenses); revenues; operating margins; return on assets; return on equity; debt; debt plus equity; market or economic value added; stock price appreciation; total



stockholder return; cost control; strategic initiatives; market share; net income; return on invested capital; improvements in capital structure; or customer satisfaction, employee satisfaction, services performance, subscriber, cash management or asset management metrics (together, the"“Performance Criteria"Criteria”).

(b)    Such performance goals also may be based on the achievement of specified levels of Company performance (or performance of an applicable affiliate or business unit of the Company) under one or more of the Performance Criteria described above relative to the performance of other corporations. Such performance goals shall be set by the Committee within the time period prescribed by, and shall otherwise comply with the requirements of, Section 162(m) of the Code, or any successor provision thereto, and the regulations thereunder.

(c)    The Committee may provide in any such Award that any evaluation of performance may include or exclude any of the following events that occurs during a performance period: (i) asset write-downs, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax laws, accounting principles, or other laws or provisions affecting reported results, (iv) any reorganization and restructuring programs, (v) extraordinary nonrecurring items as described in Accounting Principles Board Opinion No. 30 and/or in Management's Discussion and Analysis of Financial Condition and Results of Operations appearing in the Company's annual report to stockholders for the applicable year, (vi) acquisitions or divestitures, (vii) foreign exchange gains and losses, and (viii) gains and losses on asset sales. To the extent such inclusions or exclusions affect Awards to Covered Employees, they shall be prescribed in a form that satisfies the requirements for "performance-based compensation"“performance-based compensation” within the meaning of Section 162(m)(4)(C) of the Code, or any successor provision thereto.

16.2Compensation Committee Certification; Adjustment of Awards

(a)    After the completion of each performance period, the Compensation Committee shall certify the extent to which any performance goal established under this Section 16 has been satisfied, and the amount payable as a result thereof, prior to payment, settlement or vesting, as applicable, of any Award subject to this Section 16.

16.

(b)    Notwithstanding any provision of the Plan other than Section 15, with respect to any Award that is subject to this Section 16, the Committee may adjust downwards, but not upwards, the amount payable pursuant to such Award, and the Committee may not waive the achievement of the applicable performance goals except in the case of the death or disability of the Covered Employee.

16.3Limitations

(a)    Subject to adjustment from time to time as provided in Section 15.1, no Covered Employee may be granted Awards other than Performance Units subject to this Section 16 in any calendar year period with respect to more than 5,000,000600,000 shares of Common Stock for such Awards, except that the Company may make additional onetime grants of such Awards for up to 5,000,000600,000 shares to newly hired or newly promoted individuals, and the maximum dollar value payable with respect to Performance


Units or other awards payable in cash subject to this Section 16 granted to any Covered Employee in any one calendar year is $3,000,000.

(b)    The Committee shall have the power to impose such other restrictions on Awards subject to this Section 16 as it may deem necessary or appropriate to ensure that such Awards satisfy all requirements for "performance-based compensation"“performance-based compensation” within the meaning of Section 162(m)(4)(C) of the Code, or any successor provision thereto.



SECTION 17. AMENDMENT AND TERMINATION

17.1Amendment, Suspension or Termination

The Board or the Compensation Committee may amend, suspend or terminate the Plan or any portion of the Plan at any time and in such respects as it shall deem advisable; provided, however, that, to the extent required by applicable law, regulation or stock exchange rule, stockholder approval shall be required for any amendment to the Plan; and provided, further, that any amendment that requires stockholder approval may be made only by the Board. Subject to Section 17.3, the Committee may amend the terms of any outstanding Award, prospectively or retroactively.

17.2Term of the Plan

Unless sooner terminated as provided herein, the Plan shall terminate ten years from the Effective Date. After the Plan is terminated, no future Awards may be granted, but Awards previously granted shall remain outstanding in accordance with their applicable terms and conditions and the Plan's terms and conditions. Notwithstanding the foregoing, no Incentive Stock Options may be granted more than ten years after the later of (a) the adoption of the Plan by the Board and (b) the adoption by the Board of any amendment to the Plan that constitutes the adoption of a new plan for purposes of Section 422 of the Code.

17.3Consent of Participant

The amendment, suspension or termination of the Plan or a portion thereof or the amendment of an outstanding Award shall not, without the Participant's consent, materially adversely affect any rights under any Award theretofore granted to the Participant under the Plan. Any change or adjustment to an outstanding Incentive Stock Option shall not, without the consent of the Participant, be made in a manner so as to constitute a "modification"“modification” that would cause such Incentive Stock Option to fail to continue to qualify as an Incentive Stock Option. Notwithstanding the foregoing, any adjustments made pursuant to Section 15 shall not be subject to these restrictions.


SECTION 18. GENERAL

18.1No Individual Rights

No individual or Participant shall have any claim to be granted any Award under the Plan, and the Company has no obligation for uniformity of treatment of Participants under the Plan. Furthermore, nothing in the Plan or any Award granted under the Plan shall be deemed to constitute an employment contract or confer or be deemed to confer on any Participant any right to continue in the employ of, or to continue any other relationship with, the Company or any Related Company or limit in any way the right of the Company or any Related Company to terminate a Participant's employment or other relationship at any time, with or without cause.

18.2Issuance of Shares

(a)    Notwithstanding any other provision of the Plan, the Company shall have no obligation to issue or deliver any shares of Common Stock under the Plan or make any other distribution of benefits under the Plan unless, in the opinion of the Company's counsel, such issuance, delivery or distribution would comply with all applicable laws (including, without limitation, the requirements of the Securities Act or the laws of any state or foreign jurisdiction) and the applicable requirements of any securities exchange or similar entity.

(b)    The Company shall be under no obligation to any Participant to register for offering or resale or to qualify for exemption under the Securities Act, or to register or qualify under the laws of any state or foreign jurisdiction, any shares of Common Stock, security or interest in a security paid or



issued under, or created by, the Plan, or to continue in effect any such registrations or qualifications if made.

(c)    As a condition to the exercise of an Option or any other receipt of Common Stock pursuant to an Award under the Plan, the Company may require (a) the Participant to represent and warrant at the time of any such exercise or receipt that such shares are being purchased or received only for the Participant's own account and without any present intention to sell or distribute such shares and (b) such other action or agreement by the Participant as may from time to time be necessary to comply with the federal, state and foreign securities laws. At the option of the Company, a stop-transfer order against any such shares may be placed on the official stock books and records of the Company, and a legend indicating that such shares may not be pledged, sold or otherwise transferred, unless an opinion of counsel is provided (concurred in by counsel for the Company) stating that such transfer is not in violation of any applicable law or regulation, may be stamped on stock certificates to ensure exemption from registration.


The Committee may also require the Participant to execute and deliver to the Company a purchase agreement or such other agreement as may be in use by the Company at such time that describes certain terms and conditions applicable to the shares.

(d)    To the extent the Plan or any instrument evidencing an Award provides for issuance of stock certificates to reflect the issuance of shares of Common Stock, the issuance may be effected on a noncertificated basis, to the extent not prohibited by applicable law or the applicable rules of any stock exchange.


18.3Indemnification

(a)    Each person who is or shall have been a member of the Board, or a committee appointed by the Board, or an officer of the Company to whom authority was delegated in accordance with Section 3, shall be indemnified and held harmless by the Company against and from any loss, cost, liability or expense that may be imposed upon or reasonably incurred by such person in connection with or resulting from any claim, action, suit or proceeding to which such person may be a party or in which such person may be involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by such person in settlement thereof, with the Company's approval, or paid by such person in satisfaction of any judgment in any such claim, action, suit or proceeding against such person; provided, however, that such person shall give the Company an opportunity, at its own expense, to handle and defend the same before such person undertakes to handle and defend it on such person's own behalf, unless such loss, cost, liability or expense is a result of such person's own willful misconduct or except as expressly provided by statute.

(b)    The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such person may be entitled under the Company's certificate of incorporation or bylaws, as a matter of law, or otherwise, or of any power that the Company may have to indemnify or hold harmless.

18.4No Rights as a Stockholder

Unless otherwise provided by the Committee or in the instrument evidencing the Award or in a written employment, services or other agreement, no Award, other than a Stock Award or Restricted Stock Award, shall entitle the Participant to any cash dividend, voting or other right of a stockholder unless and until the date of issuance under the Plan of the shares that are the subject of such Award.

18.5Compliance with Laws and Regulations

(a)    In interpreting and applying the provisions of the Plan, any Option granted as an Incentive Stock Option pursuant to the Plan shall, to the extent permitted by law, be construed as an "incentive“incentive stock option"option” within the meaning of Section 422 of the Code.


(b)    The Plan and Awards granted under the Plan are intended to be exempt from the requirements of Section 409A to the maximum extent possible, whether pursuant to the short-term deferral exception described in Treasury Regulation Section 1.409A-1(b)(4), the exclusion applicable to stock options, stock appreciation rights and certain other equity-based compensation under Treasury Regulation Section 1.409A-1(b)(5), or otherwise. To the extent Section 409A is applicable to the Plan or any Award granted under the Plan, it is intended that the Plan and any Awards granted under the Plan comply with the deferral, payout and other limitations and restrictions imposed under Section 409A. Notwithstanding any other provision of the Plan or any Award granted under the Plan to the contrary, the Plan and any Award granted under the Plan shall be interpreted, operated and administered in a manner consistent with such intentions. Without limiting the generality of the foregoing, and notwithstanding any other provision of the Plan or any Award granted under the Plan to the contrary, with respect to any payments and benefits under the Plan or any Award granted under the Plan to which Section 409A applies, all references in the Plan or any Award granted under the Plan to the termination of the Participant's employment or service are intended to mean the Participant's "separation“separation from service,"” within the meaning of Section 409A(a)(2)(A)(i). In addition, if the Participant is a "specified“specified employee,"” within the meaning of Section 409, then to the extent necessary to avoid subjecting the Participant to the imposition of any additional tax under Section 409A, amounts that would otherwise be payable under the Plan or any Award granted under the Plan during the six-month period immediately following the Participant's "separation“separation from service,"” within the meaning of Section 409A(a)(2)(A)(i), shall not be paid to the Participant during such period, but shall instead be accumulated and paid to the Participant (or, in the event of the Participant's death, the Participant's estate) in a lump sum on the first business day after the earlier of the date that is six months following the Participant's separation from service or the Participant's death. Notwithstanding any other provision of the Plan to the contrary, the Committee, to the extent it deems necessary or advisable in its sole discretion, reserves the right, but shall not be required, to unilaterally amend or modify the Plan and any Award granted under the Plan so that the Award qualifies for exemption from or complies with Section 409A; provided, however, that the Committee makes no representations that Awards granted under the Plan shall be exempt from or comply with Section 409A and makes no undertaking to preclude Section 409A from applying to Awards granted under the Plan.





18.6Participants in Other Countries or Jurisdictions

Without amending the Plan, the Committee may grant Awards to Eligible Persons who are foreign nationals on such terms and conditions different from those specified in the Plan as may, in the judgment of the Committee, be necessary or desirable to foster and promote achievement of the purposes of the Plan and shall have the authority to adopt such modifications, procedures, subplans and the like as may be necessary or desirable to comply with provisions of the laws or regulations of other countries or jurisdictions in which the Company or any Related Company may operate or have employees to ensure the viability of the benefits from Awards granted to Participants employed in such countries or jurisdictions, meet the requirements that permit the Plan to operate in a qualified or tax-efficient manner, comply with applicable foreign laws or regulations and meet the objectives of the Plan.

18.7No Trust or Fund

The Plan is intended to constitute an "unfunded"“unfunded” plan. Nothing contained herein shall require the Company to segregate any monies or other property, or shares of Common Stock, or to create any trusts, or to make any special deposits for any immediate or deferred amounts payable to any Participant, and no Participant shall have any rights that are greater than those of a general unsecured creditor of the Company.


18.8Successors

All obligations of the Company under the Plan with respect to Awards shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all the business and/or assets of the Company.

18.9Severability

If any provision of the Plan or any Award is determined to be invalid, illegal or unenforceable in any jurisdiction, or as to any person, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to applicable laws, or, if it cannot be so construed or deemed amended without, in the Committee's determination, materially altering the intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction, person or Award, and the remainder of the Plan and any such Award shall remain in full force and effect.

18.10Choice of Law and Venue

The Plan, all Awards granted thereunder and all determinations made and actions taken pursuant hereto, to the extent not otherwise governed by the laws of the United States, shall be governed by the laws of the State of Delaware without giving effect to principles of conflicts of law. Participants irrevocably consent to the nonexclusive jurisdiction and venue of the state and federal courts located in the State of Delaware.

18.11Legal Requirements

The granting of Awards and the issuance of shares of Common Stock under the Plan are subject to all applicable laws, rules and regulations and to such approvals by any governmental agencies or national securities exchanges as may be required.


SECTION 19. EFFECTIVE DATE

The effective date (the "“Effective Date"”) is the date on which the Plan is adopted by the Board. If the stockholders of the Company do not approve the Plan within 12 months after the Board's adoption of the Plan, any Incentive Stock Options granted under the Plan will be treated as Nonqualified Stock Options.



APPENDIX A


APPENDIX A

DEFINITIONS

As used in the Plan,

        "“Acquired Entity"” means any entity acquired by the Company or a Related Company or with which the Company or a Related Company merges or combines.

        "“Award"” means any Option, Stock Appreciation Right, Stock Award, Restricted Stock, Stock Unit, Performance Share, Performance Unit, cash-based award or other incentive payable in cash or in shares of Common Stock as may be designated by the Committee from time to time.

        "“Board"” means the Board of Directors of the Company.

        "“Cause,"” unless otherwise defined in the instrument evidencing an Award or in a written employment, services or other agreement between the Participant and the Company or a Related Company, means dishonesty, fraud, serious or willful misconduct, unauthorized use or disclosure of confidential information or trade secrets, or conduct prohibited by law (except minor violations), in each case as determined by the Company's chief human resources officer or other person performing that function or, in the case of directors and executive officers, the Compensation Committee, whose determination shall be conclusive and binding.

        "“Change in Control,"” unless the Committee determines otherwise with respect to an Award at the time the Award is granted or unless otherwise defined for purposes of an Award in a written employment, services or other agreement between the Participant and the Company or a Related Company, means the occurrence of any of the following events:

(a)    an acquisition by any Entity of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 40% or more of either (1) the then outstanding shares of Common Stock of the Company (the "“Outstanding Company Common Stock"”) or (2) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the "“Outstanding Company Voting Securities"”), provided, however, that the following acquisitions shall not constitute a Change in Control: (i) any acquisition directly from the Company, other than an acquisition by virtue of the exercise of a conversion privilege where the security being so converted was not acquired directly from the Company by the party exercising the conversion privilege, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any Related Company, or (iv) an acquisition by any Entity pursuant to a transaction that meets the conditions of clauses (i), (ii) and (iii) set forth in the definition of Company Transaction;

(b)    a change in the composition of the Board during any two-year period such that the individuals who, as of the beginning of such two-year period, constitute the Board (the "“Incumbent Board"”) cease for any reason to constitute at least a majority of the Board; provided, however, that for purposes of this definition, any individual who becomes a member of the Board subsequent to the beginning of the two-year period, whose election, or nomination for election by the Company's stockholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso) shall be considered as though such individual were a member of the Incumbent Board; and provided further, however, that any such individual whose initial assumption of office occurs as a result of or in connection with an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of an Entity other than the Board shall not be considered a member of the Incumbent Board; or

(c)    the consummation of a Company Transaction.


        "“Code"” means the Internal Revenue Code of 1986, as amended from time to time.

        "“Committee"” has the meaning set forth in Section 3.1.

        "3.1.

“Common Stock"” means the common stock, no par value, of the Company.

        "“Company"” means Vitesse Semiconductor Corporation, a Delaware corporation.

        "“Company Transaction,"” unless the Committee determines otherwise with respect to an Award at the time the Award is granted or unless otherwise defined for purposes of an Award in a written employment, services or other agreement between the Participant and the Company or a Related Company, means consummation of:

(a)    a merger or consolidation of the Company with or into any other company;

(b)    a sale in one transaction or a series of transactions undertaken with a common purpose of all of the Company's outstanding voting securities; or

(c)    a sale, lease, exchange or other transfer in one transaction or a series of related transactions undertaken with a common purpose of all or substantially all of the Company's assets,



excluding, however, in each case, a transaction pursuant to which

(i)    the Entities who are the beneficial owners of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Company Transaction will beneficially own, directly or indirectly, at least 50% of the outstanding shares of common stock, and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, of the Successor Company in substantially the same proportions as their ownership, immediately prior to such Company Transaction, of the Outstanding Company Common Stock and Outstanding Company Voting Securities;

(ii)    no Entity (other than the Company, any employee benefit plan (or related trust) of the Company, a Related Company or a Successor Company) will beneficially own, directly or indirectly, 50% or more of, respectively, the outstanding shares of common stock of the Successor Company or the combined voting power of the outstanding voting securities of the Successor Company entitled to vote generally in the election of directors unless such ownership resulted solely from ownership of securities of the Company prior to the Company Transaction; and

(iii)    individuals who were members of the Incumbent Board will immediately after the consummation of the Company Transaction constitute at least a majority of the members of the board of directors of the Successor Company.

Where a series of transactions undertaken with a common purpose is deemed to be a Company Transaction, the date of such Company Transaction shall be the date on which the last of such transactions is consummated.

        "“Compensation Committee"” means the Compensation Committee of the Board.

        "“Covered Employee"” means a "covered employee"“covered employee” as that term is defined for purposes of Section 162(m)(3) of the Code or any successor provision.

        "“Disability,"” unless otherwise defined by the Committee for purposes of the Plan in the instrument evidencing an Award or in a written employment, services or other agreement between the Participant and the Company or a Related Company, means a mental or physical impairment of the Participant that is expected to result in death or that has lasted or is expected to last for a continuous period of 12 months or more and that causes the Participant to be unable to perform his or her material duties for the Company or a Related Company and to be engaged in any substantial gainful activity, in each case as determined by the Company's chief human resources officer or other person performing that



function or, in the case of directors and executive officers, the Compensation Committee, whose determination shall be conclusive and binding.

        "“Effective Date"” has the meaning set forth in Section 19.

        "19.

“Eligible Person"” means any person eligible to receive an Award as set forth in Section 5.

        "5Entity.

“"Entity” means any individual, entity or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act).

        "“Exchange Act"” means the Securities Exchange Act of 1934, as amended from time to time.

        "“Fair Market Value"” means the closing price for the Common Stock on any given date during regular trading, or if not trading on that date, such price on the last preceding date on which the Common Stock was traded, unless determined otherwise by the Committee using such methods or procedures as it may establish.

        "“Grant Date"” means the later of (a) the date on which the Committee completes the corporate action authorizing the grant of an Award or such later date specified by the Committee and (b) the date on which all conditions precedent to an Award have been satisfied, provided that conditions to the exercisability or vesting of Awards shall not defer the Grant Date.

        "“Incentive Stock Option"” means an Option granted with the intention that it qualify as an "incentive“incentive stock option"option” as that term is defined for purposes of Section 422 of the Code or any successor provision.

        "“Nonqualified Stock Option"” means an Option other than an Incentive Stock Option.

        "“Option"” means a right to purchase Common Stock granted under Section 7.

        "7.

“Option Expiration Date"” means the last day of the maximum term of an Option.

        "“Outstanding Company Common Stock"” has the meaning set forth in the definition of "Change“Change in Control."”

        "“Outstanding Company Voting Securities"” has the meaning set forth in the definition of "Change“Change in Control."”

        "“Parent Company"” means a company or other entity which as a result of a Company Transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries.

        "“Participant"” means any Eligible Person to whom an Award is granted.

        "“Performance Award"” means an Award of Performance Shares or Performance Units granted under Section 11.

        "11.

“Performance Criteria"” has the meaning set forth in Section 16.1.

        "16.1.

“Performance Share"” means an Award of units denominated in shares of Common Stock granted under Section 11.1.

        "11.1.



“Performance Unit"” means an Award of units denominated in cash or property other than shares of Common Stock granted under Section 11.2.

        "11.2Plan.

“"Plan” means the Vitesse Semiconductor Corporation 2013 Incentive Plan.
“Prior Plans” means the Vitesse Semiconductor Corporation 2010 Incentive Plan and the Vitesse Semiconductor Corporation 2001 Stock Incentive Plan.

        "“Related Company"” means any entity that is directly or indirectly controlled by, in control of or under common control with the Company.


        "“Restricted Stock"” means an Award of shares of Common Stock granted under Section 10, the rights of ownership of which are subject to restrictions prescribed by the Committee.

        "“Retirement,"” unless otherwise defined in the instrument evidencing the Award or in a written employment, services or other agreement between the Participant and the Company or a Related Company, means "Retirement"“Retirement” as defined for purposes of the Plan by the Committee or the Company's chief human resources officer or other person performing that function or, if not so defined, means Termination of Service on or after the date the Participant reaches "normal“normal retirement age,"” as that term is defined in Section 411(a)(8) of the Code.

        "“Securities Act"” means the Securities Act of 1933, as amended from time to time.

        "“Section 409A"” means Section 409A of the Code.

        "“Stock Appreciation Right"” or "“SAR"” means a right granted under Section 9.1 to receive the excess of the Fair Market Value of a specified number of shares of Common Stock over the grant price.

        "“Stock Award"” means an Award of shares of Common Stock granted under Section 10, the rights of ownership of which are not subject to restrictions prescribed by the Committee.

        "“Stock Unit"” means an Award denominated in units of Common Stock granted under Section 10.

        "10.

“Substitute Awards"” means Awards granted or shares of Common Stock issued by the Company in substitution or exchange for awards previously granted by an Acquired Entity.

        "“Successor Company"” means the surviving company, the successor company or Parent Company, as applicable, in connection with a Company Transaction.

        "“Termination of Service"” means a termination of employment or service relationship with the Company or a Related Company for any reason, whether voluntary or involuntary, including by reason of death, Disability or Retirement. Any question as to whether and when there has been a Termination of Service for the purposes of an Award and the cause of such Termination of Service shall be determined by the Company's chief human resources officer or other person performing that function or, with respect to directors and executive officers, by the Compensation Committee, whose determination shall be conclusive and binding. Transfer of a Participant's employment or service relationship between the Company and any Related Company shall not be considered a Termination of Service for purposes of an Award. Unless the Compensation Committee determines otherwise, a Termination of Service shall be deemed to occur if the Participant's employment or service relationship is with an entity that has ceased to be a Related Company. A Participant's change in status from an employee of the Company or a Related Company to a nonemployee director, consultant, advisor, or independent contractor of the Company or a Related Company or a change in status from a nonemployee director, consultant, advisor or independent contractor of the Company or a Related Company to an employee of the Company or a Related Company, shall not be considered a Termination of Service.

        "“Vesting Commencement Date"” means the Grant Date or such other date selected by the Committee as the date from which an Award begins to vest.



Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas. X 0163AD 5 2 D V +   PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.   Annual Meeting Proxy Card . Authorized Signatures — This section must be completed for your vote to be counted — Date and Sign Below C Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box. Date (mm/dd/yyyy) — Please print date below. + Change of Address — Please print your new address below. Comments — Please print your comments below. B Non-Voting Items A Proposals — The Board of Directors recommends a vote FOR all the nominees listed and FOR Proposals 2 and 3. For Against Abstain 2. To approve the Vitesse Semiconductor Corporation 2010 Incentive Plan. For Against Abstain 3. To ratify the appointment of BDO Seidman, LLP as our independent registered public accounting firm for the fiscal year ending September 30, 2010. Meeting Attendance Mark the box to the right if you plan to attend the Annual Meeting. 01 - Christopher R. Gardner 04 - G. Grant Lyon 02 - Steve P. Hanson 05 - Edward Rogas, Jr. 03 - James H. Hugar 1. Election of Directors: For Withhold For Withhold For Withhold 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000004 MR A SAMPLE DESIGNATION (IF ANY) ADD 1 ADD 2 ADD 3 ADD 4 ADD 5 ADD 6 0 2 5 2 7 1 1 MR A SAMPLE (THIS AREA IS SET UP TO ACCOMMODATE 140 CHARACTERS) MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND C 1234567890 J N T C123456789 Admission Ticket




PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.  Notice of 2010 Annual Meeting of Stockholders Proxy Solicited by Board of Directors for Annual Meeting — May 11, 2010 The undersigned, stockholder of Vitesse Semiconductor Corporation, a Delaware corporation, hereby acknowledges receipt of the Notice of Annual Meeting of Stockholders and Proxy Statement, each dated March 31, 2010, and hereby appoints Christopher R. Gardner and Richard C. Yonker, and each of them, proxies and attorneys-in-fact, with full power to each of substitution, on behalf and in the name of the undersigned, to represent the undersigned at the Annual Meeting of Stockholders of Vitesse Semiconductor Corporation to be held on May 11, 2010 at 9:00 a.m., local time, at the Hyatt Westlake Plaza in Thousand Oaks, 880 S. Westlake Blvd., Westlake Village, California 91361, and at any adjournment(s) thereof and to vote all shares of common stock which the undersigned would be entitled to vote if then and there personally present, on all the matters set forth on the reverse side. THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO CONTRARY DIRECTION IS INDICATED, WILL BE VOTED (1) TO ENSURE AS MANY OF THE NOMINEES FOR THE ELECTION OF DIRECTORS SET FORTH IN PROPOSAL ONE ARE ELECTED AS DIRECTORS, (2) FOR THE APPROVAL OF THE VITESSE SEMICONDUCTOR CORPORATION 2010 INCENTIVE PLAN AS SET FORTH IN PROPOSAL TWO, (3) FOR THE RATIFICATION OF THE APPOINTMENT OF OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AS SET FORTH IN PROPOSAL THREE, AND AS SAID PROXIES DEEM ADVISABLE ON SUCH OTHER MATTERS AS MAY COME BEFORE THE MEETING AND ANY ADJOURNMENT(S) THEREOF. Proxy — VITESSE SEMICONDUCTOR CORPORATION 2010 Annual Meeting Admission Ticket 2010 Annual Meeting of VITESSE SEMICONDUCTOR CORPORATION May 11, 2010 9:00 a.m. Local Time Hyatt Westlake Plaza Thousand Oaks 880 S. Westlake Blvd. Westlake Village, California 91361 Upon arrival, please present this admission ticket and photo identification at the registration desk. Directions From Los Angeles Int’l Airport: Take Century Blvd. to 405 San Diego Freeway North to 101 West/Ventura Fwy.-North. Exit at Westlake Blvd., turn left. Pass over freeway to first signal and turn left. Hotel is on right. From Burbank Airport: Exit to Hollywood Way South. Turn left onto Alameda Ave. Follow signs to 134 Ventura Fwy.-West. Hwy 134 converts to 101 Ventura Fwy.-North. Exit at Westlake Blvd., turn left. Pass over freeway to first signal and turn left. Hotel is on right.



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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS May 11, 2010



IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 11, 2010

YOUR VOTE IS IMPORTANT


INFORMATION CONCERNING SOLICITATION AND VOTING
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 11, 2010

PROPOSAL ONE ELECTION OF DIRECTORS

PROPOSAL TWO
DESCRIPTION OF THE 2010 INCENTIVE PLAN
EQUITY COMPENSATION PLAN INFORMATION
PROPOSAL THREE RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
EXECUTIVE OFFICERS AND EXECUTIVE COMPENSATION
CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
OTHER MATTERS
VITESSE SEMICONDUCTOR CORPORATION 2010 INCENTIVE PLAN SECTION 1. PURPOSE
SECTION 2. DEFINITIONS
SECTION 3. ADMINISTRATION
SECTION 4. SHARES SUBJECT TO THE PLAN
SECTION 5. ELIGIBILITY
SECTION 6. AWARDS
SECTION 7. OPTIONS
SECTION 8. INCENTIVE STOCK OPTION LIMITATIONS
SECTION 9. STOCK APPRECIATION RIGHTS
SECTION 10. STOCK AWARDS, RESTRICTED STOCK AND STOCK UNITS
SECTION 11. PERFORMANCE AWARDS
SECTION 12. OTHER STOCK OR CASH-BASED AWARDS
SECTION 13. WITHHOLDING
SECTION 14. ASSIGNABILITY
SECTION 15. ADJUSTMENTS
SECTION 16. CODE SECTION 162(m) PROVISIONS
SECTION 17. AMENDMENT AND TERMINATION
SECTION 18. GENERAL
SECTION 19. EFFECTIVE DATE
APPENDIX A DEFINITIONS