EXHIBIT 10.9
MINDSPEED TECHNOLOGIES, INC.
RETIREMENT SAVINGS PLAN
(Amended and restated effective as of August 1, 2005)
TABLE OF CONTENTS
Page
PREAMBLE.................................................................................................. 1
ARTICLE I: DEFINITIONS.................................................................................... 2
1.010 Accounts.................................................................................. 2
1.020 Actual Contribution Percentage............................................................ 2
1.030 Actual Contribution Percentage Limit...................................................... 2
1.040 Actual Deferral Percentage................................................................ 3
1.050 Actual Deferral Percentage Limit.......................................................... 3
1.060 Administrative Committee.................................................................. 4
1.070 Affiliated Company........................................................................ 5
1.080 Base Compensation......................................................................... 5
1.090 Basic Post-Tax Contributions.............................................................. 5
1.100 Basic Pre-Tax Contributions............................................................... 5
1.110 Beneficiary............................................................................... 5
1.120 Board of Directors........................................................................ 6
1.130 Catch-Up Pre-Tax Contributions............................................................ 6
1.140 Catch-Up Pre-Tax Contribution Account..................................................... 6
1.150 Code...................................................................................... 6
1.160 Company................................................................................... 6
1.170 Company Matching Contributions............................................................ 6
1.180 Company Matching Contribution Account..................................................... 6
1.190 Company Profit Sharing Contributions...................................................... 6
1.200 Company Profit Sharing Contribution Account............................................... 7
1.210 Compensation.............................................................................. 7
1.220 Effective Date............................................................................ 7
1.230 Eligible Employee......................................................................... 7
1.240 Eligible Retirement Plan.................................................................. 7
1.250 Employee.................................................................................. 8
1.260 ERISA..................................................................................... 8
1.270 Hardship.................................................................................. 8
1.280 Highly Compensated Employee............................................................... 9
1.290 Highly Compensated Employee Group......................................................... 9
1.300 Investment Fund(s)........................................................................ 10
1.310 Layoff.................................................................................... 10
1.320 Leased Employee........................................................................... 10
1.330 Mindspeed................................................................................. 10
1.340 Mindspeed Stock Fund...................................................................... 10
1.350 Named Fiduciary........................................................................... 10
1.360 Non-Highly Compensated Employee........................................................... 10
1.370 Non-Highly Compensated Employee Group..................................................... 11
1.380 Participant............................................................................... 11
1.390 Participant Contributions................................................................. 11
1.400 Plan...................................................................................... 11
1.410 Plan Administrator........................................................................ 11
1.420 Plan Committee............................................................................ 11
1.430 Plan Year................................................................................. 11
1.440 Post-Tax Contributions.................................................................... 11
1.450 Post-Tax Contribution Account............................................................. 11
1.460 Pre-Tax Contributions..................................................................... 11
1.470 Pre-Tax Contribution Account.............................................................. 11
1.480 Rollover Contributions.................................................................... 11
1.490 Rollover Contributions Account............................................................ 12
1.500 Supplemental Post-Tax Contributions....................................................... 12
1.510 Supplemental Pre-Tax Contributions........................................................ 12
1.520 Transfer Contributions.................................................................... 12
1.530 Trust Agreement........................................................................... 12
1.540 Trust Fund................................................................................ 12
1.550 Trustee................................................................................... 12
1.560 Valuation Date............................................................................ 12
ARTICLE II: PARTICIPATION AND CONTRIBUTIONS............................................................... 12
2.010 Participation............................................................................. 12
2.020 Basic Contributions....................................................................... 12
2.030 Supplemental Contributions................................................................ 13
2.040 Changes Between Pre-Tax and Post-Tax Contributions........................................ 13
2.050 Catch-Up Pre-Tax Contributions............................................................ 13
2.060 Company Matching Contributions............................................................ 14
2.070 Company Profit Sharing Contributions...................................................... 15
2.080 Transfer Contributions and Rollover Contributions......................................... 15
ARTICLE III: CONTRIBUTION LIMITATIONS..................................................................... 17
3.010 Limitations on Employee Contributions..................................................... 17
ARTICLE IV: PLAN INVESTMENTS.............................................................................. 22
4.010 Investment Elections...................................................................... 22
4.020 Fund Transfers - Participant Contributions, Company Matching Contributions,
Company Profit Sharing Contributions, Rollover Contributions and Transfer
Contributions............................................................................. 23
4.030 Participant's Accounts.................................................................... 24
4.040 Valuation and Participant Statements...................................................... 24
ARTICLE V: EMPLOYMENT TERMINATION BENEFITS................................................................ 24
5.010 Vesting................................................................................... 24
5.020 Retirement, Death, Layoff, Etc............................................................ 25
5.030 Form of Distributions to Retiring Participants............................................ 30
5.040 Termination of Employment or Severance From Employment.................................... 30
5.050 Cash-Out and Automatic Rollover Rules..................................................... 31
5.060 Transfer of Distribution Directly to Eligible Retirement Plan............................. 32
ii
ARTICLE VI: WITHDRAWALS AND LOANS......................................................................... 32
6.010 Withdrawals from Accounts by Participants under Age 59-1/2................................ 32
6.020 Withdrawals from Accounts by Participants over Age 59-1/2................................. 33
6.030 Hardship Withdrawals from Pre-Tax Contribution Accounts................................... 34
6.040 Allocation of Withdrawals Among Investment Funds.......................................... 35
6.050 Loans..................................................................................... 35
6.060 Transfers to Certain Affiliated Company Plans............................................. 35
6.070 Transfer of Distribution or Withdrawal to Eligible Retirement Plan........................ 36
ARTICLE VII: DEATH BENEFITS............................................................................... 36
7.010 Designation of a Beneficiary.............................................................. 36
7.020 Payment to a Beneficiary.................................................................. 37
ARTICLE VIII: TRUST AGREEMENT............................................................................. 37
8.010 Establishment of Trust Fund............................................................... 37
8.020 Investment Funds of the Trust............................................................. 37
8.030 Trustee's Powers and Authority............................................................ 37
8.040 Statutory Limits.......................................................................... 37
8.050 Duty of Trustee as to Common Stock in the Mindspeed Stock Fund............................ 38
8.060 Rights in the Trust Fund.................................................................. 39
8.070 Taxes, Fees and Expenses of the Trustee................................................... 39
ARTICLE IX: ADMINISTRATION................................................................................ 40
9.010 General Administration.................................................................... 40
9.020 Plan Committee............................................................................ 40
9.030 Plan Committee Records.................................................................... 41
9.040 Funding Policy............................................................................ 41
9.050 Allocation and Delegation of Duties Under the Plan........................................ 41
9.060 Plan Committee Powers..................................................................... 41
9.070 Plan Administrator........................................................................ 42
9.080 Reliance Upon Documents and Opinions...................................................... 42
9.090 Requirement of Proof...................................................................... 42
9.100 Limitation on Liability and Indemnification............................................... 43
9.110 Mailing and Lapse of Payments............................................................. 43
9.120 Non-Alienation............................................................................ 43
9.130 Notices and Communications................................................................ 44
9.140 Company Rights............................................................................ 44
9.150 Payments on Behalf of Incompetent Participants or Beneficiaries........................... 44
ARTICLE X: PARTICIPANT CLAIMS............................................................................. 45
10.010 Requirement to File Claim................................................................. 45
10.020 Appeal of Denied Claim.................................................................... 45
ARTICLE XI: AMENDMENT, MERGERS, TERMINATION, ETC.......................................................... 45
11.010 Amendment................................................................................. 45
11.020 Transfer of Assets and Liabilities........................................................ 45
iii
11.030 Merger Restriction........................................................................ 46
11.040 Suspension of Contributions............................................................... 46
11.050 Discontinuance of Contributions........................................................... 46
11.060 Termination............................................................................... 46
ARTICLE XII: STATUTORY LIMITATIONS........................................................................ 47
12.010 Annual Limits of Participant's Account Increases.......................................... 47
12.020 Combining Similar Plans................................................................... 47
12.030 Correcting Contributions in Excess of Annual Limits....................................... 47
ARTICLE XIII: TOP HEAVY PROVISIONS........................................................................ 49
13.010 Definitions............................................................................... 49
13.020 Application of this Article............................................................... 51
ARTICLE XIV: MISCELLANEOUS................................................................................ 51
14.010 Benefits Payable only from Trust Fund..................................................... 51
14.020 Requirement for Release................................................................... 51
14.030 Transfers of Stock........................................................................ 51
14.040 Qualification of the Plan................................................................. 51
14.050 Interpretation............................................................................ 52
14.060 Military Service.......................................................................... 52
Appendix A................................................................................................ A-1
Appendix B................................................................................................ B-1
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PREAMBLE
The Plan is established effective as of July 1, 2003. The Plan was amended,
effective as of July 1, 2003, to include procedures to address any contributions
which are in excess of Internal Revenue Code Section 415(c) limitations based on
model language issued by the Internal Revenue Service. The Plan was amended
effective as of March 28, 2005 to provide that, in the absence of an election by
the participant to the contrary, the account balances of a participant who has
separated from service will be automatically rolled over from the Plan to an
individual retirement account in the name of such participant if such account
balances equal more than $1,000 but not more than $5,000. Appendix B to the Plan
was amended effective as of April 26, 2005 to reflect the addition of four new
Fidelity Freedom investment funds. The Plan was amended and restated effective
as of August 1, 2005 to incorporate all amendments adopted through such date.
ARTICLE I: DEFINITIONS
1.010 ACCOUNTS means a Participant's Pre-Tax Contribution Account, Post-Tax
Contribution Account, Company Matching Contribution Account, Company Profit
Sharing Contribution Account, Rollover Contributions Account and Catch-Up
Pre-Tax Contribution Account.
1.020 ACTUAL CONTRIBUTION PERCENTAGE means, for each of the Highly Compensated
Employee Group and the Non-Highly Compensated Employee Group, the average of
each such Group's percentages, calculated separately for each Participant in
such Group, which is obtained by dividing the sum of amount of Company Matching
Contributions determined under Section 2.060 plus the amount of Post-Tax
Contributions each Participant has elected for the relevant Plan Year pursuant
to Sections 2.020(b) and 2.030(b) by the Participant's Compensation for that
Plan Year. The Actual Contribution Percentage will be calculated to the nearest
..01%.
1.030 ACTUAL CONTRIBUTION PERCENTAGE LIMIT means the maximum Actual Contribution
Percentage permitted for each Plan Year for Highly Compensated Employee Group
Participants and will be that percentage amount which does not exceed the
greater of:
(a) the Actual Contribution Percentage for the Non-Highly Compensated Employee
Group, multiplied by one and twenty-five hundredths (1.25); or
(b) the lesser of:
(1) an amount which does not exceed the Actual Contribution Percentage
for the Non-Highly Compensated Employee Group by more than two (2)
percentage points; or
(2) the Actual Contribution Percentage for the Non-Highly Compensated
Employee Group, multiplied by two (2).
If a Participant who is a member of the Highly Compensated Employee Group is a
participant in any other plan established or maintained by an Affiliated Company
pursuant to which elective deferrals under a cash-or-deferred arrangement or
matching contributions, both as defined in Section 401(m)(4) of the Code, or
employee contributions, are made, such other plan will be deemed to be part of
this Plan for the purpose of determining the Actual Contribution Percentage
Limit with respect to that Participant.
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The Plan will take into account the Actual Contribution Percentage of all
Eligible Employees for purposes of the Actual Contribution Percentage Limit. For
this purpose, an Eligible Employee is any Employee who is, directly or
indirectly, eligible to receive Company Matching Contributions or to make
Post-Tax Contributions, including an Employee who would be eligible for Company
Matching Contributions but for his or her failure to make required Pre-Tax
Contributions and an Employee whose right to receive Company Matching
Contributions or to make Post-Tax Contributions has been suspended because of an
election not to participate. In the case of an Eligible Employee who does not
receive Company Matching Contributions or who did not make Post-Tax
Contributions, the Actual Contribution Percentage that is to be included in
determining the Actual Contribution Percentage Limit is zero.
A Post-Tax Contribution or a Company Matching Contribution will be taken into
account under the Actual Contribution Percentage Limit for a Plan Year only if
it is made on account of the Eligible Employee's receipt of a Company Matching
Contribution or deferral of Post-Tax Contributions for the Plan Year and is
contributed to the Trust before the last day of the twelve-month period
immediately following the Plan Year to which the Company Matching Contributions
or Post-Tax Contributions relate and is allocated within the Plan Year to which
the Company Matching Contributions or Post-Tax Contributions relate. Qualified
Matching Contributions (as defined in Section 3.010(c)(1)(ii)) which are used to
meet the requirements of Section 401(k)(3)(A) of the Code are not taken into
account under the Actual Contribution Percentage Limit. The Actual Contribution
Percentage Limit will be calculated to the nearest .01%.
1.040 ACTUAL DEFERRAL PERCENTAGE means, for the Highly Compensated Employee
Group and the Non-Highly Compensated Employee Group, the average of each such
Group's percentages, calculated separately for each Participant in such Group,
which is obtained by dividing the amount of Pre-Tax Contributions each
Participant has elected for the relevant Plan Year pursuant to Sections 2.020(a)
and 2.030(a) by the Participant's Compensation for that Plan Year. Catch-Up
Pre-Tax Contributions deferred in accordance with Section 2.050 of the Plan are
not included in the calculation of the Actual Deferral Percentage. The Actual
Deferral Percentage will be calculated to the nearest .01%.
1.050 ACTUAL DEFERRAL PERCENTAGE LIMIT means the maximum Actual Deferral
Percentage permitted for each Plan Year for Highly Compensated Employee Group
Participants and will be that percentage amount which does not exceed the
greater of:
(a) the Actual Deferral Percentage for the Non-Highly Compensated Employee
Group, multiplied by one and twenty-five hundredths (1.25); or
(b) the lesser of:
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(1) an amount which does not exceed the Actual Deferral Percentage for
the Non-Highly Compensated Employee Group by more than two (2)
percentage points; or
(2) the Actual Deferral Percentage for the Non-Highly Compensated
Employee Group, multiplied by two (2).
If a Participant who is a member of the Highly Compensated Employee Group is a
participant in any other plan established or maintained by an Affiliated Company
pursuant to which elective deferrals under a cash-or-deferred arrangement or
matching contributions, both as defined in Section 401(m)(4) of the Code, or
employee contributions, are made, such other plan will be deemed to be part of
this Plan for the purpose of determining the Actual Deferral Percentage Limit
with respect to that Participant.
The Plan will take into account the Actual Deferral Percentage of all Eligible
Employees for purposes of calculating the Actual Deferral Percentage Limit. For
this purpose, an Eligible Employee is any Employee who is, directly or
indirectly, eligible to make Pre-Tax Contributions, including an Employee whose
right to make Pre-Tax Contributions has been suspended because of an election
not to participate. In the case of an Eligible Employee who does not make
Pre-Tax Contributions, the Actual Deferral Percentage that is to be included in
determining the Actual Deferral Percentage Limit is zero.
A Pre-Tax Contribution deferred under Sections 2.020(a) and 2.030(a) of the Plan
will be taken into account under the Actual Deferral Percentage Limit only if
such contribution is related to Compensation that either would have been
received by the Employee in the Plan Year (but for the deferral election under
Sections 2.020(a) and 2.030(a) of the Plan) or is attributable to services
performed by the Employee in the Plan Year and would have been received by the
Employee within 2 -1/2 months after the close of the Plan Year (but for the
deferral election).
A Pre-Tax Contribution deferred under Sections 2.020(a) and 2.030(a) of the Plan
will be taken into account under the Actual Deferral Percentage Limit for a Plan
Year only if it is contributed to the Trust Fund before the last day of the
twelve-month period immediately following the Plan Year to which the
contribution relates. A Pre-Tax Contribution is considered allocated as of a
date within the Plan Year if such allocation is not contingent on participation
or performance after such date. The Actual Deferral Percentage Limit will be
calculated to the nearest .01%.
1.060 ADMINISTRATIVE COMMITTEE means the committee appointed by the Plan
Committee and assigned responsibility under Section 6.030.
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1.070 AFFILIATED COMPANY means Mindspeed Technologies, Inc. and:
(a) any corporation incorporated under the laws of one of the states of the
United States of America of which Mindspeed owns, directly or indirectly,
eighty percent (80%) or more of the combined voting power of all classes
of stock or eighty percent (80%) or more of the total value of the shares
of all classes of stock (all within the meaning of Section 1563 of the
Code);
(b) any partnership or other business entity organized under such laws, of
which Mindspeed owns, directly or indirectly, eighty percent (80%) or more
of the voting power or eighty percent (80%) or more of the total value
(all within the meaning of Section 414(c) of the Code); and
(c) any other company deemed to be an Affiliated Company by Mindspeed's Board
of Directors.
1.080 BASE COMPENSATION means a Participant's Compensation during any Plan Year,
not in excess of Two Hundred Thousand Dollars ($200,000) (or such other amount
as may be established pursuant to Section 401(a)(17) of the Code for any
calendar year and effective for the first Plan Year which begins with or within
such calendar year) including lump sum merit awards and any amount which would
be paid to the Participant absent elections under Sections 2.020(a) and 2.030(a)
of the Plan or an election to make elective employer contributions pursuant to a
qualified cash or deferred arrangement under a cafeteria plan meeting the
requirements of Section 125 of the Code. Base Compensation will not include
compensation for overtime, extended workweek compensation, night work or other
premium pay, bonuses, any form of extra, contingent or supplementary
compensation (including, but not limited to lump sum payments for unused
vacation) or compensation on the hourly payroll.
1.090 BASIC POST-TAX CONTRIBUTIONS means the amounts contributed by a
Participant to the Plan through payroll deductions pursuant to the Participant's
elections under Sections 2.020(b) and 2.030(b).
1.100 BASIC PRE-TAX CONTRIBUTIONS means the amounts contributed to the Plan on
behalf of a Participant pursuant to the Participant's elections under Sections
2.020(a) and 2.030(a).
1.110 BENEFICIARY means one or more persons or trusts designated by a
Participant pursuant to Article VII; provided, however, that, in the case of a
Participant who has been married for a one (1) year period and who dies prior to
complete distribution of his or her Accounts, the Beneficiary of such person
will be deemed to be the Participant's spouse regardless of any contrary
designation, unless the Participant has filed with the Plan
Page 5
Administrator a written designation of a person or persons other than such
spouse as Beneficiary or Beneficiaries. Such written designation must be
accompanied by a written consent of the Participant's spouse or it is
established to the satisfaction of the Plan Administrator that such consent
cannot be obtained because there is no spouse or the spouse cannot be located or
on account of other circumstances permitted under Section 417(a)(2) of the Code.
Such written consent (the execution of which must be witnessed by a notary
public who is not an Employee) will be on a form furnished to the Participant by
the Plan Administrator and will acknowledge the effect of such consent. In the
event the Participant has a new spouse to whom he or she has been married for at
least a one (1) year period, the designation of the prior spouse will be void
and the new spouse will be deemed to be the Participant's Beneficiary, unless
the Participant makes a written designation of a person or persons other than
the new spouse.
1.120 BOARD OF DIRECTORS means the Board of Directors of Mindspeed; provided,
however, that any action or determination under Sections 1.070, 1.160, 1.230,
2.060, 2.070, 11.010, and 11.060 may be taken by any officer of the Company who
is authorized to do so by the Board of Directors.
1.130 CATCH-UP PRE-TAX CONTRIBUTIONS means an amount contributed to the Plan on
behalf of a Participant pursuant to the Participant's elections under Section
2.050.
1.140 CATCH-UP PRE-TAX CONTRIBUTION ACCOUNT means a Plan Account with respect to
a Participant which is comprised of his or her Catch-Up Pre-Tax Contributions,
as adjusted for gains or losses related thereto.
1.150 CODE means the Internal Revenue Code of 1986, as from time to time
amended.
1.160 COMPANY means Mindspeed Technologies, Inc., a Delaware corporation, and
any other entity to which the Board of Directors has extended this Plan.
1.170 COMPANY MATCHING CONTRIBUTIONS means the contributions made to the Trust
Fund by Mindspeed or an Affiliated Company pursuant to the provisions of Section
2.060.
1.180 COMPANY MATCHING CONTRIBUTION ACCOUNT means a Plan Account with respect to
a Participant which is comprised of his or her Company Matching Contributions,
as adjusted for gains or losses related thereto.
1.190 COMPANY PROFIT SHARING CONTRIBUTIONS means the contributions made to the
Trust Fund by Mindspeed or an Affiliated Company pursuant to the provisions of
Section 2.070.
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1.200 COMPANY PROFIT SHARING CONTRIBUTION ACCOUNT means a Plan Account with
respect to a Participant which is comprised of his or her Company Profit Sharing
Contributions, as adjusted for gains or losses related thereto.
1.210 COMPENSATION means the compensation of a Participant as defined in Section
414(s) of the Code.
1.220 EFFECTIVE DATE means July 1, 2003.
1.230 ELIGIBLE EMPLOYEE means any Employee (including any officer) employed on a
salary or weekly payroll of an Affiliated Company, or on the salary or weekly
payroll of a division, plant, office or location of an Affiliated Company, to
which the benefits of the Plan have been extended by the Board of Directors who
was hired (and advised he or she was hired) directly by the Company as a regular
employee and who performs regular employment services directly for the Company.
Eligible Employee will not include any director of the Company not otherwise so
employed, nor any person not otherwise so employed who is compensated by special
fees or pursuant to a special contract or arrangement, or on a commission basis,
nor any person covered by a collective bargaining agreement which does not
provide for participation in the Plan. The terms "Eligible Employee" and
"Eligible Employees" as used in this Plan will not include any individuals who
work, or who were hired to work, or who were advised that they work:
(a) as independent contractors or employees of independent contractors;
(b) as temporary employees, regardless of the length of time that they work at
the Company;
(c) through a temporary placement agency, job placement agency, or other third
party; or
(d) as part of an employee leasing arrangement between the Company and any
third party.
For the purposes of this Plan, the exclusions described above will remain in
effect even if a court or administrative agency determines that such individuals
are common law employees and not independent contractors. Such individuals will
not be retroactively permitted to participate in the Plan.
1.240 ELIGIBLE RETIREMENT PLAN means:
(a) an individual retirement account described in Section 408(a) of the Code;
(b) an individual retirement annuity described in Section 408(b) of the Code;
Page 7
(c) an annuity contract described in Section 403(a) of the Code;
(d) an eligible plan described in Section 457(b) of the Code which is
maintained by a state, political subdivision of a state or any agency or
instrumentality of a state or political subdivision of a state; or
(e) a qualified plan (which is a defined contribution plan) described in
Section 401(a) of the Code,
which agrees to accept an individual's eligible rollover distributions and which
agrees to separately account for amounts transferred into such plan from the
Plan. The definition of Eligible Retirement Plan will apply in the case of a
distribution to a surviving spouse, or to a spouse or former spouse who is the
alternate payee under a qualified domestic relations order, as defined in
Section 414(p) of the Code to all types of Eligible Retirement Plans described
in (a)-(e) above.
With respect to that portion of the distribution from the Plan which is not
includible in gross income, such portion of the distribution may be transferred
only to an eligible retirement plan under subsections (a), (b) or (e) above that
agrees to separately account for amounts so transferred, including separate
accounting for the portion of such distribution which is includible in gross
income and the portion of such distribution which is not so includible.
1.250 EMPLOYEE means any employee of the Company or of any Affiliated Company or
other employer required to be aggregated with the Company under Section 414(b),
Section 414(c), Section 414(m) or Section 414(o) of the Code. "Employee" will,
to the extent permitted by Section 406 of the Code, be deemed to include any
United States citizen regularly employed by a foreign subsidiary or affiliate of
the Company. The term Employee will also include any Leased Employee deemed to
be an Employee of any employer described in the previous sentence as provided in
Section 414(n) or Section 414(o) of the Code.
1.260 ERISA means the Employee Retirement Income Security Act of 1974, as it may
be amended from time to time.
1.270 HARDSHIP means an immediate and heavy financial need of an Employee for
which the amount required is not reasonably available to such Employee from
other sources and which arises for one of the following reasons:
(a) the purchase (excluding mortgage payments) or construction of a principal
residence for the Employee, or to prevent eviction from, or foreclosure on
the mortgage on, the Employee's principal residence;
Page 8
(b) the incurring of obligations for:
(1) tuition, related educational fees and room and board expenses for
post-secondary education for the Employee, his or her spouse or one
or more of his or her children or other dependents (as defined in
Section 152 of the Code) to be incurred during the twelve (12) month
period immediately following the date of his or her request for
distribution; or
(2) expenses not covered by insurance which either have been previously
incurred by the Employee for, or are necessary in order for the
Employee to obtain, medical care (as described in Section 213(d) of
the Code) for himself, his or her spouse or one or more of his or
her dependents (as defined in Section 152 of the Code);
(c) any other reason which is permitted under Section 401(k)(2)(B)(i)(IV) of
the Code and which is approved by the Administrative Committee.
1.280 HIGHLY COMPENSATED EMPLOYEE means any Employee who (a) was a five percent
(5%) owner (as defined in Section 416(i)(1) of the Code) of the Company at any
time during the current or preceding Plan Year, or (b) for the preceding Plan
Year, (1) had compensation from the Company in excess of Ninety Thousand Dollars
($90,000) (as adjusted pursuant to Section 415(d) of the Code), and (2) if the
Company elects the application of this clause for such preceding Plan Year, was
in the top-paid group of Employees for such preceding Plan Year.
For this purpose, an Employee is in the top-paid group of Employees for any year
if such Employee is in the group consisting of the top twenty percent (20%) of
the Employees when ranked on the basis of compensation paid during such year. A
former employee will be treated as a Highly Compensated Employee if (x) such
Employee was a Highly Compensated Employee when such Employee separated from
service from the Company, or (y) such Employee was a Highly Compensated Employee
at any time after attaining age 55.
The determination of who is a Highly Compensated Employee, including the
determinations of the number and identity of Employees in the top-paid group,
will be made in accordance with Section 414(q) of the Code and the regulations
thereunder.
For purposes of this subsection, the term "compensation" means compensation
within the meaning of Section 415(c)(3) of the Code.
1.290 HIGHLY COMPENSATED EMPLOYEE GROUP means all Eligible Employees who are
Highly Compensated Employees.
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1.300 INVESTMENT FUND(S) means one or more of the investment vehicles available
to Participants as such investment vehicles are described in Appendix B to this
Plan, including the Mindspeed Stock Fund.
1.310 LAYOFF means an involuntary severance of employment, other than a
discharge for cause.
1.320 LEASED EMPLOYEE means any person (other than an Employee of the Company)
who, pursuant to an agreement between the Company and any other person ("leasing
organization"), has performed services for the Company (or for the Company and
related persons determined in accordance with Section 414(n)(6) of the Code) on
a substantially full-time basis for a period of at least one year, and such
services are performed under the primary direction or control of the Company.
Contributions or benefits provided to a Leased Employee by the leasing
organization which are attributable to services performed for the Company will
be treated as if provided by the Company.
A Leased Employee will not be considered an Employee of the Company if: (a) such
Leased Employee is covered by a money purchase pension plan providing: (1) a
nonintegrated employer contribution rate of at least 10 percent (10%) of
compensation, as defined in Section 415(c)(3) of the Code, but including amounts
contributed pursuant to a salary reduction agreement which are excludable from
the Leased Employee's gross income under Section 125, Section 402(e)(3), Section
402(h)(1)(B) or Section 403(b) of the Code; (2) immediate participation; and (3)
full and immediate vesting; and (b) Leased Employees do not constitute more than
twenty percent (20%) of the Company's non-highly compensated work force.
1.330 MINDSPEED means Mindspeed Technologies, Inc., a Delaware corporation, and
its affiliates and successors.
1.340 MINDSPEED STOCK FUND means the fund established by the Trustee for receipt
and holding of Company Matching Contributions and Company Profit Sharing
Contributions. The Mindspeed Stock Fund is also an Investment Fund established
by the Trustee and described in Appendix B to the Plan.
1.350 NAMED FIDUCIARY means the Plan Committee, the Plan Administrator, the
Administrative Committee and the Trustee.
1.360 NON-HIGHLY COMPENSATED EMPLOYEE means any Eligible Employee who does not
satisfy the definition of a Highly Compensated Employee.
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1.370 NON-HIGHLY COMPENSATED EMPLOYEE GROUP means all Eligible Employees who are
Non-Highly Compensated Employees.
1.380 PARTICIPANT means a person who has elected to participate in the Plan in
accordance with Article II; provided, however, that such term will include a
person who no longer has an effective election under Article II only so long as
he or she retains an Account under the Plan.
1.390 PARTICIPANT CONTRIBUTIONS means a Participant's Basic Pre-Tax and Basic
Post-Tax Contributions, his or her Supplemental Pre-Tax and Supplemental
Post-Tax Contributions and his or her Catch-Up Pre-Tax Contributions.
1.400 PLAN means this Mindspeed Technologies, Inc. Retirement Savings Plan, as
from time to time amended.
1.410 PLAN ADMINISTRATOR means the person designated as such from time to time
by name or corporate office by the Board of Directors.
1.420 PLAN COMMITTEE means the Mindspeed Employee Benefit Plan Committee.
1.430 PLAN YEAR means each twelve-month period ending on the last day of
December. Notwithstanding the preceding, the first plan year shall be a short
plan year beginning July 1, 2003 and ending December 31, 2003.
1.440 POST-TAX CONTRIBUTIONS means contributions made to the Plan on an
after-tax basis by Participants pursuant to an election under Sections 2.020(b)
and 2.030(b) of the Plan.
1.450 POST-TAX CONTRIBUTION ACCOUNT means a Plan Account with respect to a
Participant which is comprised of his or her Basic and Supplemental Post-Tax
Contributions, as adjusted for gains or losses related thereto.
1.460 PRE-TAX CONTRIBUTIONS means contributions made to the Plan on a pre-tax
basis by Participants pursuant to an election under Sections 2.020(a) and
2.030(a) of the Plan and pursuant to an election under Section 2.050 of the
Plan.
1.470 PRE-TAX CONTRIBUTION ACCOUNT means a Plan Account with respect to a
Participant which is comprised of Pre-Tax Contributions, as adjusted for gains
or losses related thereto.
1.480 ROLLOVER CONTRIBUTIONS means the amounts described in Section 2.080 which
are transferred to a Participant's Rollover Contributions Account pursuant to
the terms of subsection (b) of said Section.
Page 11
1.490 ROLLOVER CONTRIBUTIONS ACCOUNT means a Plan Account described in Section
2.080(c) which has as its purpose the holding of amounts received by the Plan on
a Participant's behalf as a Rollover Contribution or a Transfer Contribution.
1.500 SUPPLEMENTAL POST-TAX CONTRIBUTIONS means the amounts contributed by a
Participant to the Plan through payroll deductions pursuant to Section 2.030(b).
1.510 SUPPLEMENTAL PRE-TAX CONTRIBUTIONS means the amounts contributed to the
Plan on behalf of a Participant pursuant to the Participant's election under
Section 2.030(a).
1.520 TRANSFER CONTRIBUTIONS means the amounts described in Section 2.080 which
are transferred to a Participant's Account pursuant to the terms of subsection
(a) of the said Section.
1.530 TRUST AGREEMENT means the trust agreement entered into pursuant to Article
VIII of this Plan.
1.540 TRUST FUND means the fund, including the earnings thereon, held by the
Trustee for all contributions made under this Plan by Participants and the
Company.
1.550 TRUSTEE means the trustee or trustees of the trust described in Article IX
of this Plan.
1.560 VALUATION DATE means any American Stock Exchange trading day.
ARTICLE II: PARTICIPATION AND CONTRIBUTIONS
2.010 PARTICIPATION. An Eligible Employee will be permitted to elect to
participate in the Plan as soon as is practicable following his or her
commencement of service with the Company or an Affiliated Company. To the extent
administratively feasible, an Eligible Employee's election to participate and
contribute to the Plan will become effective on the first payroll payment date
following his or her commencement of service as an Eligible Employee and will
remain in effect so long as he or she continues as an Employee, unless he or she
elects otherwise.
2.020 BASIC CONTRIBUTIONS. An Eligible Employee who notifies the Company of his
or her election to become a Participant will also take either or both of the
actions described in subsections (a) and (b) below:
(a) elect to defer receipt of an amount equal to 1% through 4% of his or her
regular Base Compensation (such deferral to be elected in whole
percentages), which
Page 12
amount will be paid to the Plan as a Basic Pre-Tax Contribution to his or
her Pre-Tax Contribution Account;
(b) authorize having deducted from his or her regular Base Compensation 1%
through 4% (such deduction to be authorized in whole percentages) and then
have the amount of such deduction (as adjusted for all applicable taxes
due on that amount) paid to the Plan as a Basic Post-Tax Contribution to
his or her Post-Tax Contribution Account;
provided, however, that the percentages elected to be deferred or deducted and
then made as Basic Pre-Tax and Basic Post-Tax Contributions will together not
exceed 4% of the Participant's Base Compensation.
2.030 SUPPLEMENTAL CONTRIBUTIONS. If a Participant has made the elections and/or
authorizations described in Section 2.010, he or she will be permitted to take
either or both of the actions described in subsections (a) and (b) below:
(a) elect to defer receipt of an amount equal to 5% through 17% of his or her
regular Base Compensation (such deferral to be elected in whole
percentages), which amount will be paid to the Plan as a Supplemental
Pre-Tax Contribution to his or her Pre-Tax Contribution Account;
(b) authorize having an amount equal to 5% through 17% deducted from his or
her regular Base Compensation (such deduction to be authorized in whole
percentages) and then have the amount of such deduction (as adjusted for
all applicable taxes due on that amount) paid to the Plan as a
Supplemental Post-Tax Contribution to his or her Post-Tax Contribution
Account;
provided, however, that the percentages elected to be deferred or deducted and
then made as Supplemental Pre-Tax and Supplemental Post-Tax Contributions will
together not exceed 17% of the Participant's Base Compensation.
2.040 CHANGES BETWEEN PRE-TAX AND POST-TAX CONTRIBUTIONS. A Participant will be
permitted to elect to increase or decrease at any time (and as often as he or
she wishes) the rate of his or her Pre-Tax and Post-Tax Contributions under
Sections 2.020 and 2.030. Any such increase or decrease of the rate of the
Participant's Pre-Tax and Post-Tax Contributions will be effective as soon as is
reasonably possible after receipt by the Plan Administrator of the Participant's
election.
2.050 CATCH-UP PRE-TAX CONTRIBUTIONS. An Eligible Employee who attained age
fifty (50) before the close of the Plan Year may notify the Company of his or
her election to defer receipt of a percentage of his or her Base Compensation in
excess of the amount
Page 13
elected under Sections 2.020(a) and 2.030(a) of the Plan (as limited by, among
other sections, Sections 3.010(a) and 12.010 of the Plan and as limited by the
Code) which amount will be contributed as a Catch-Up Pre-Tax Contribution to his
or her Catch-Up Pre-Tax Contribution Account. The Plan will not be treated as
failing to satisfy the provisions of the Plan implementing the requirements of
Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b) or 416 of the Code, as
applicable, by reason of the making of such Catch-Up Pre-Tax Contribution.
Notwithstanding the preceding, the maximum amount which an Eligible Employee may
elect to defer under this Section as a Catch-Up Pre-Tax Contribution will be
limited as follows:
YEAR AMOUNT
- ---- ------
2003 $2,000
2004 $3,000
2005 $4,000
2006 $5,000
For the Plan Years beginning on or after January 1, 2007, the maximum amount of
Catch-Up Pre-Tax Contributions which may be deferred will be increased in
accordance with Section 414(v)(2)(C) of the Code.
2.060 COMPANY MATCHING CONTRIBUTIONS. The Company will contribute to the Plan on
behalf of each Participant and out of its current or accumulated profits Company
Matching Contributions in such amounts and on such basis and in such forms as
are set forth below:
(a) The Company Matching Contribution may be credited to the Account of each
Participant in an amount between zero percent (0%) and one hundred percent
(100%) of the Participant's Basic Pre-Tax and Basic Post-Tax
Contributions, the exact percentage to be determined from time to time by
the Plan Committee.
(b) Company Matching Contributions will be in the form of the common stock of
Mindspeed Technologies, Inc., but may, in the discretion of the Board of
Directors, be in cash or in any combination of cash and the common stock
of Mindspeed Technologies, Inc. The Company's common stock will be valued
at the American Stock Exchange closing price on the Valuation Date
immediately preceding the date on which the contribution is made. The
Company Matching Contributions made hereunder, whether made in the form of
Mindspeed common stock or cash,
Page 14
will initially be directed to the Mindspeed Stock Fund, but may be
reinvested to any other Investment Fund at any time.
(c) No Company Matching Contributions will be made with respect to Transfer
Contributions or Rollover Contributions. No Company Matching Contributions
will be made with respect to Catch-Up Pre-Tax Contributions.
2.070 COMPANY PROFIT SHARING CONTRIBUTIONS.
(a) On behalf of each Participant who is employed on the last day of the Plan
Year, the Company may contribute to the Plan Company Profit Sharing
Contributions, the exact amount to be determined by the Plan Committee and
deposited into the Trust Fund by the Company within a reasonable time
after the end of the Plan Year, but not later than the time prescribed by
law for filing the Company's annual tax return with the Internal Revenue
Service, in the ratio that each Participant's Compensation bears to the
total Compensation of all Participants.
(b) Company Profit Sharing Contributions will be in the form of the common
stock of Mindspeed Technologies, Inc., but may, in the discretion of the
Board of Directors, be in cash or in any combination of cash and the
common stock of Mindspeed Technologies, Inc. The Company's common stock
will be valued at the American Stock Exchange closing price on the
Valuation Date immediately preceding the date on which the contribution is
made. The Company Profit Sharing Contributions will initially be directed
to the Mindspeed Stock Fund, but may be reinvested to any other Investment
Fund at any time.
2.080 TRANSFER CONTRIBUTIONS AND ROLLOVER CONTRIBUTIONS. Transfers to this Plan
of a Participant's interest in another individual account plan will be permitted
in the situations and pursuant to the requirements set forth below:
(a) A Participant who is presently an Eligible Employee, but who formerly
though an Employee was not an Eligible Employee, may cause his or her
account balances in any other individual account of the Company to be
transferred to this Plan. Such transferred account balances (which will be
entirely in cash or, if such balances consist in whole or in part of
participant loans from the transferring plan, in cash and in kind) will
constitute Transfer Contributions.
(b) A Participant who is an Eligible Employee may elect (by providing the Plan
Administrator with notice thereof) to have the entire amount credited to
his or her account in a qualified individual account plan of a former
employer transferred from such plan to this Plan as a Rollover
Contribution, subject to the following:
Page 15
(1) The Plan will accept a direct rollover or an Eligible Employee
contribution of an eligible rollover distribution as defined in
Section 402(c)(4) of the Code from:
(i) a qualified plan described in Section 401(a) or 403(a) of the
Code, including after-tax or post-tax employee contributions;
(ii) an annuity contract described in Section 403(b) of the Code,
including after-tax or post-tax employee contributions;
(iii) an eligible plan described in Section 457(b) of the Code which
is maintained by a state, political subdivision of a state, or
any agency or instrumentality of a state or political
subdivision of a state; or
(iv) an individual retirement account or annuity described in
Section 408(a) or 408(b) of the Code.
(2) No portion of such Rollover Contributions may be derived from a
transfer from a qualified plan under Section 401(a) of the Code
which at any time had permitted benefit payments in the form of a
life annuity.
(c) Transfer Contributions and Rollover Contributions will be credited to the
Participant's Account as follows:
(1) that portion of such balance attributable to employee contributions
made pursuant to deferral elections under Section 401(k) of the Code
will be credited to the Participant's Pre-Tax Contribution Account;
(2) that portion of such balance attributable to employee contributions
other than those described in paragraph (1) above will be credited
to the Participant's Pre-Tax Contribution Account, but the
Participant's tax basis under the Code in such contributions will be
the same as his or her tax basis under the prior individual account
plan; and
(3) that portion of such balance attributable to employee contributions
made on an after-tax basis will be credited to the Participant's
Post-Tax Contribution Account.
No Company Matching Contributions will be made under Section 2.060 with respect
to the Transfer Contributions and Rollover Contributions described in this
Section.
Page 16
ARTICLE III: CONTRIBUTION LIMITATIONS
3.010 LIMITATIONS ON EMPLOYEE CONTRIBUTIONS.
(a) (1) The aggregate amount in any calendar year of all of a Participant's:
(i) Basic Pre-Tax and Supplemental Pre-Tax Contributions to this
Plan;
(ii) elective deferrals under any other cash-or-deferred
arrangement (as defined in Section 402(g) of the Code); and
(iii) elective employer contributions to any simplified employee
pension (as defined in and pursuant to Section 408(k)(1) and
(6), respectively, of the Code)
may not exceed Twelve Thousand Dollars ($12,000) or such larger sum as may be in
effect under Section 402(g) of the Code. For the years 2004 through 2006 the
limits will be increased as follows:
YEAR AMOUNT
- ---- -------
2004 $13,000
2005 $14,000
2006 $15,000
For the Plan Years beginning on or after January 1, 2007, the aggregate amount
will be increased in accordance with Section 402(g)(5) of the Code.
Notwithstanding the preceding, Catch-Up Pre-Tax Contributions deferred under
Section 2.050 of the Plan and Section 414(v) of the Code will not be counted
against the aggregate amount described herein in this Section 3.010(a)(1) of the
Plan.
(2) Notwithstanding any other provision of the Plan, Excess Elective
Deferrals ("Elective Deferrals" and "Excess Elective Deferrals" as
defined below), as adjusted for income or losses thereon, will be
distributed to Participants who request a distribution in accordance
with the following:
(i) For purposes of this Section, the following definitions will
have the following meanings:
Page 17
(A) "Elective Deferrals," for a taxable year, means the sum
of Company contributions made on behalf of a Participant
pursuant to an election to defer under any qualified
cash-or-deferred arrangement as described in Section
401(k) of the Code, any simplified employee pension
cash-or-deferred arrangement as described in Section
402(h)(1)(B) of the Code, any plan as described under
Section 501(c)(18) of the Code, and any Company
contributions made on behalf of a Participant for the
purchase of an annuity contract under Section 403(b) of
the Code pursuant to a salary reduction agreement.
However, Catch-Up Pre-Tax Contributions are excluded
from the term "Elective Deferrals" for these purposes.
(B) "Excess Elective Deferrals" means those Elective
Deferrals that are includible in a Participant's gross
income under Section 402(g) of the Code because they
exceed the dollar limit specified in (a)(1) above.
Excess Elective Deferrals are included in the annual
limits under Section 12.010 of the Plan.
(ii) A Participant may assign to the Plan any Excess Elective
Deferrals made during the calendar year by such Participant by
filing a claim in writing with the Plan Administrator no later
than March 1 following the year in which the Excess Elective
Deferral was made. The claim will specify the Participant's
Excess Elective Deferral amount for the preceding calendar
year and will be accompanied by the Participant's written
statement that if such amounts are not distributed, such
Excess Elective Deferral amount, when added to amounts
deferred under other plans or arrangements described in
Section 401(k), Section 408(k), Section 457, Section
501(c)(18) or Section 403(b) of the Code, will exceed the
Section 402(g) of the Code dollar limit for the year in which
the deferral occurred. A Participant will be deemed to have
given notification described above if the Excess Elective
Deferral results from Elective Deferrals to the Plan or other
plans of the Company or an Affiliated Company.
(iii) A Participant who has an Excess Elective Deferral during a
taxable year may receive a corrective distribution during the
same year. Such a corrective distribution will be made if:
(A) the Participant designates the distribution as an Excess
Elective Deferral or is deemed to make the designation
under part (ii) above;
Page 18
(B) the corrective distribution is made after the date on
which the Plan received the Excess Elective Deferral;
and
(C) the Plan Administrator designates the distribution as a
distribution of an Excess Elective Deferral.
(iv) The Excess Elective Deferral distributed to a Participant with
respect to a calendar year will be adjusted to reflect income
or loss in the Participant's Pre-Tax Contribution Account for
the taxable year allocable thereto. The income or loss
allocable to such Excess Elective Deferral amount will be
determined by the method generally used under the Plan to
allocate income or loss to a Participant's account.
(v) Excess Elective Deferral amounts, as adjusted for income and
losses, will be distributed to a Participant no later than
April 15 of the year following the calendar year in which such
Excess Elective Deferral was made.
(b) (1) As soon as practicable after the end of the Plan Year, the Plan
Administrator will cause the test under Section 1.050 of the Plan to
be conducted on Pre-Tax Contribution elections under Sections
2.020(a) and 2.030(a), in order to determine whether the Actual
Deferral Percentage for the Highly Compensated Employee Group
exceeds the Actual Deferral Percentage Limit under subsection (a) or
(b) of Section 1.050 of the Plan. If the Actual Deferral Percentage
of the Highly Compensated Employee Group exceeds the Actual Deferral
Percentage Limit, the Company may elect either of the following:
(i) to reduce the allowable Pre-Tax Contributions for Highly
Compensated Employees as provided in Sections 3.010(b)(3) and
3.010(b)(5); or
(ii) to make additional contributions, hereinafter called Qualified
Non-Elective Contributions (subject to the requirements of
Section 3.010(b)(6)), for all or a portion of the Non-Highly
Compensated Employee Group eligible to make Pre-Tax
Contributions in a level dollar amount or a uniform percentage
of Compensation, as the Company will elect, within the time
period required by any applicable law or regulation.
(2) The amounts of Post-Tax Contributions and Company Matching
Contributions for a Highly Compensated Employee in excess of those
permitted under Section 1.050 will be considered Excess
Contributions.
Page 19
(3) Excess Contributions that must be distributed in accordance with
Section 3.010(b)(5) will be reduced by Excess Elective Deferrals
previously distributed in accordance with Section 3.010(a)(2).
(4) Failure to correct Excess Contributions by the close of the Plan
Year following the Plan Year for which they were made will cause the
cash-or-deferred arrangement to fail to satisfy the requirements of
Section 401(k)(3) of the Code for the Plan Year for which Excess
Contributions were made and for all subsequent years they remain in
the Trust Fund. In addition, the Company will be liable for a 10%
excise tax on the amount of Excess Contributions (unless corrected
by distribution or recharacterization of Excess Contributions)
within 2-1/2 months after the close of the Plan Year for which they
were made.
(5) Excess Contributions will be distributed to Participants on whose
behalf such Excess Contributions were made no later than the last
day of the twelve-month period immediately following the Plan Year
for which they were made. Excess Contributions will be distributed
first to the Participant who is the Highly Compensated Employee
electing the highest amount of Pre-Tax Contributions until the
nondiscrimination test set forth in Section 1.050 of the Plan is
met, or until such Pre-Tax Contribution election is reduced to the
same dollar amount as the Participant who is the Highly Compensated
Employee electing the second highest amount of Pre-Tax
Contributions. If further distributions are required, such
Participants' elections will be reduced to the same dollar amount of
Pre-Tax Contributions as the Participant who is the Highly
Compensated Employee electing the next highest amount of Pre-Tax
Contributions and such further distributions will continue in the
same manner until the nondiscrimination test is satisfied. Excess
Contributions will be adjusted to reflect income earned and losses
incurred on the Participant's Pre-Tax Contributions Account for the
Plan Year.
(6) Qualified Non-Elective Contributions and/or Company Matching
Contributions can be used to satisfy the requirements of the Actual
Deferral Percentage Limit test only if such contributions are
nonforfeitable when made and are subject to the same distribution
restrictions that apply to Pre-Tax Contributions. Additional
Qualified Non-Elective Contributions and/or Company Matching
Contributions which may be treated as Pre-Tax Contributions must
satisfy these requirements without regard to whether they are
actually taken into account as Pre-Tax Contributions for purposes of
satisfying the Actual Deferral Percentage Limit test. Additional
Qualified Non-Elective Contributions and/or Company Matching
Contributions may be treated as Pre-Tax Contributions only if the
conditions described in
Page 20
Section 1.401(k)-1(b)(5) of the Department of the Treasury
Regulations are satisfied.
(7) The amounts of the additional Qualified Non-Elective Contributions
and/or Company Matching Contributions for Non-Highly Compensated
Employees or the reduction in the amounts of allowable Pre-Tax
Contributions for Highly Compensated Employees under subsection
(b)(5) above will be such that at least one of the tests contained
in Section 1.050 of the Plan is satisfied.
(8) Any Company Matching Contributions made on account of an Excess
Contribution or Excess Elective Deferral will be forfeited and will
be used to reduce Company Matching Contributions for the year of
forfeiture.
(c) (1) As soon as practicable after the end of the Plan Year, the Plan
Administrator will cause the test under Section 1.030 of the Plan to
be conducted on Post-Tax Contributions under Sections 2.020(b) and
2.030(b) of the Plan and on Company Matching Contributions under
Section 2.060 of the Plan, in order to determine whether the Actual
Contribution Percentage for the Highly Compensated Employee Group
exceeds the Actual Contribution Percentage Limit under subsection
(a) or (b) of Section 1.030 of the Plan. If the Actual Contribution
Percentage of the Highly Compensated Employee Group exceeds the
Actual Contribution Percentage Limit, this excess is called the
"Excess Aggregate Contribution" and the Company may elect either of
the following:
(i) to reduce the allowable Post-Tax Contributions and Company
Matching Contributions for Highly Compensated Employees as
provided in Section 3.010(c)(3) of the Plan; or
(ii) to make additional contributions, hereinafter called Qualified
Matching Contributions (subject to the requirements of Section
3.010(c)(4) of the Plan), for all or a portion of the
Non-Highly Compensated Employees eligible to make Post-Tax
Contributions and to receive Company Matching Contributions in
a level dollar amount or a uniform percentage of Compensation,
as the Company will elect, within the time period required by
any applicable law or regulation.
(2) The amount of Post-Tax Contributions and Company Matching
Contributions for a Highly Compensated Employee in excess of that
permitted under Section 1.030 will be considered Excess Aggregate
Contributions.
Page 21
(3) Excess Aggregate Contributions will be distributed to Participants
on whose behalf such Excess Aggregate Contributions were made no
later than the last day of the twelve-month period immediately
following the Plan Year for which they were made. Excess Aggregate
Contributions will be distributed first to the Participant who is
the Highly Compensated Employee electing the greatest amount of
Post-Tax Contributions and/or receiving the greatest amount of
Company Matching Contributions until the nondiscrimination test set
forth in Section 1.040 is met, or until such Participant's total
amount of Post-Tax Contributions and/or Company Matching
Contributions is reduced to the second greatest amount of Post-Tax
Contributions and/or Company Matching Contributions of a Highly
Compensated Employee. If further distributions are required, such
Participants' Post-Tax Contribution elections and/or receipt of
Company Matching Contributions will be reduced to the same dollar
amount of Post-Tax Contributions and/or Company Matching
Contributions as the Participant who is the Highly Compensated
Employee receiving the second highest amount of Post-Tax
Contributions and/or Company Matching Contributions and such further
distributions will continue in the same manner until the
nondiscrimination test is satisfied. Excess Aggregate Contributions
will be adjusted to reflect income earned and losses incurred for
the Plan Year on the Participant's Post-Tax Contribution Account and
Company Matching Contribution Account.
(4) Qualified Matching Contributions can be used to satisfy the
requirements of the Actual Contribution Percentage Limit only if
such contributions are nonforfeitable when made. Additional
Qualified Matching Contributions must satisfy the requirements of
Section 401(m)-1(b)(5) of the Department of the Treasury
Regulations.
(5) Amounts forfeited by Highly Compensated Employees under Section
3.010(c)(3) will be treated as an Annual Addition (as defined under
Section 415 of the Code) under the Plan and will be applied to
reduce future Company Matching Contributions. No forfeiture arising
under this Section will be allocated to the Account of any Highly
Compensated Employee.
ARTICLE IV: PLAN INVESTMENTS
4.010 INVESTMENT ELECTIONS. In addition to the elections and authorizations set
forth in Article II, a Participant will elect in which Investment Funds
(including the Mindspeed Stock Fund) his or her Participant Contributions,
Rollover Contributions and Transfer Contributions will be invested. Such
investments will be elected by the Participant among the Investment Funds in
increments of five percent (5%), with the total of the
Page 22
elected percentage increments equaling one hundred percent (100%). The
Participant will be permitted to change on a daily basis any previous Investment
Fund election or elections he or she has made with regard to his or her
Participant Contributions, Rollover Contributions or Transfer Contributions
pursuant to this Section 4.010. The elections and changes to such elections
which a Participant makes pursuant to this Section will be made by means of any
method (including whatever telephonic or electronic means are available and
acceptable to the Plan Administrator at the time the election or change is made
by the Participant), may be made at any time and will be effective as of the
American Stock Exchange closing date immediately following the making of that
election or change.
4.020 FUND TRANSFERS - PARTICIPANT CONTRIBUTIONS, COMPANY MATCHING
CONTRIBUTIONS, COMPANY PROFIT SHARING CONTRIBUTIONS, ROLLOVER CONTRIBUTIONS AND
TRANSFER CONTRIBUTIONS. A Participant will be permitted to have the whole or
portions of the value of his or her interest in the Plan's Investment Funds
(including the Mindspeed Stock Fund), which are attributable to his or her own
Participant Contributions, Company Matching Contributions, Company Profit
Sharing Contributions, Rollover Contributions and Transfer Contributions,
transferred into one or more of the Investment Funds in accordance with the
following:
(a) Such transfers will be effected in dollars or in increments of five
percent (5%) of the value of the Participant's interest in a transferring
Investment Fund, but in no event will such transfers be in amounts less
than Two Hundred Fifty Dollars ($250), except as follows:
(1) If the balance of a Participant's interest in an Investment Fund is
in an amount which is less than Two Hundred Fifty Dollars ($250),
the Participant may elect to have the entire balance of his or her
interest in such Investment Fund transferred.
(2) The general percentage and dollar limitations set forth in this
Section which would otherwise be applicable will not be applicable
if the transfer elected by the Participant is comprised of all or a
portion of his or her interest in the Mindspeed Stock Fund.
(b) Any transfer described in this Section will be effective as of the
American Stock Exchange closing date immediately following the
Participant's election to make such a transfer.
(c) All elections under this Section will be irrevocable and will not affect
the Participant's right to exercise any other election provided by the
Plan.
Page 23
(d) Upon making a transfer election under this Section, the Participant will
also either confirm or change his or her election under Section 4.010 with
respect to future Pre-Tax Contributions and Post-Tax Contributions.
4.030 PARTICIPANT'S ACCOUNTS. Separate Participant Contribution, Rollover
Contribution (if applicable), Transfer Contribution (if applicable), Company
Matching Contribution and Company Profit Sharing Contribution Accounts will be
established and maintained by the Trustee to represent all amounts, adjusted for
gains or losses thereon, which have been contributed by or on behalf of a
Participant as Participant Contributions, Rollover Contributions, Transfer
Contributions, Company Matching Contributions and Company Profit Sharing
Contributions. Such separate Accounts will contain sufficient information to
permit a determination of the dollar balance of such Participant's Accounts at
any time and to permit, with respect to the Mindspeed Stock Fund, a
determination of the number of equivalent shares of Mindspeed common stock held
on the Participant's behalf in such Fund. Each contribution on behalf of a
Participant to an Investment Fund and each payment made to a Participant from an
Investment Fund will result in a credit or charge to the Account representing
such Participant's interest in such Fund. In addition, dividend proceeds on
Mindspeed common stock held in the Mindspeed Stock Fund will be used for the
purchase, when possible, of additional shares of Mindspeed common stock for the
Mindspeed Stock Fund and, therefore, will result in appropriate adjustments to
the balances in the Mindspeed Stock Fund, as the case may be, and to the value
of the Participant's interest in the said Fund.
4.040 VALUATION AND PARTICIPANT STATEMENTS. As of each Valuation Date, an amount
equal to the fair market value of the Investment Funds (other than dividends
received which are attributable to whole shares of Mindspeed common stock which
were or are to be transferred to Participant Accounts subsequent to the record
date for such dividend in accordance with Section 4.030) will be determined by
the Trustee in such manner and on such basis as it will deem appropriate. After
the end of each calendar year or more frequently as the Plan Administrator will
determine, the Trustee will forward by mail to each Participant a statement, in
such form as the Plan Administrator deems appropriate, setting forth pertinent
information relative to each Participant's Accounts. Such statement will, for
all purposes, be deemed to have been accepted as correct unless the Plan
Administrator (or the Trustee, as the case may be) is notified to the contrary
by the Participant mail within sixty (60) days of the mailing thereof to the
Participant.
ARTICLE V: EMPLOYMENT TERMINATION BENEFITS
5.010 VESTING. Every Participant will at all times be fully vested and have a
nonforfeitable interest in all of his or her Plan Accounts.
Page 24
5.020 RETIREMENT, DEATH, LAYOFF, ETC. Subject to the provisions of Section
5.050, as soon as practicable after the occurrence of a Participant's
retirement, death, layoff, disability of at least six (6) months duration or
termination of employment, but not later than sixty (60) days after the end of
the Plan Year in which the event has occurred, a Participant or his or her
Beneficiary (in the case of the Participant's death) will receive all amounts
described in subsections (e)(1) and (2) below. In the case, however, of
retirement, a Participant who would otherwise receive a distribution pursuant to
the preceding sentence may nevertheless elect at any time prior to the effective
date of retirement to remain in the Plan without any further contributions and
may elect to defer the retirement distribution to a later date, as herein
described in subsections (a)-(d). All distributions required under this Section
5.020 will be determined and made in accordance with the Treasury Regulations
under Section 401(a)(9) of the Code.
(a) Time and Manner of Distribution.
(1) The Participant's entire interest will be distributed, or begin to
be distributed, to the Participant no later than the Participant's
Required Beginning Date.
(2) If the Participant dies before distributions begin, the
Participant's entire interest will be distributed, or begin to be
distributed, no later than as follows:
(i) If the Participant's surviving spouse is the Participant's
sole Designated Beneficiary, then distributions to the
surviving spouse will begin by December 31 of the calendar
year immediately following the calendar year in which the
Participant died, or by December 31 of the calendar year in
which the Participant would have attained age 70-1/2, if
later.
(ii) If the Participant's surviving spouse is not the Participant's
sole Designated Beneficiary, then distributions to the
Designated Beneficiary will begin by December 31 of the
calendar year immediately following the calendar year in which
the Participant died.
(iii) If there is no Designated Beneficiary as of September 30 of
the year following the year of the Participant's death, the
Participant's entire interest will be distributed by December
31 of the calendar year containing the fifth anniversary of
the Participant's death.
(iv) If the Participant's surviving spouse is the Participant's
sole Designated Beneficiary and the surviving spouse dies
after the Participant but before distributions to the
surviving spouse begin, this subsection (a)(2), other than
subsection (a)(2)(i), will apply as if the surviving spouse
were the Participant.
Page 25
For purposes of this subsection (a)(2) and subsection (c),
unless subsection (a)(2)(iv) applies, distributions are
considered to begin on the Participant's Required Beginning
Date. If subsection (a)(2)(iv) applies, distributions are
considered to begin on the date distributions are required to
begin to the surviving spouse under subsection (a)(2)(i).
(3) Unless the Participant's interest is distributed in a single sum on
or before the Required Beginning Date, as of the first Distribution
Calendar Year distributions will be made in accordance with
subsections (b) and (c) of this Section 5.020. If the Participant's
interest is distributed in the form of an annuity purchased from an
insurance company, distributions thereunder will be made in
accordance with the requirements of Section 401(a)(9) of the Code
and the Treasury Regulations.
(b) Required Minimum Distributions During Participant's Lifetime.
(1) During the Participant's lifetime, the minimum amount that will be
distributed for each Distribution Calendar Year is the lesser of:
(i) the quotient obtained by dividing the Participant's Account
Balance by the distribution period in the Uniform Lifetime
Table set forth in Section 1.401(a)(9)-9 of the Treasury
Regulations, using the Participant's age as of the
Participant's birthday in the Distribution Calendar Year; or
(ii) if the Participant's sole Designated Beneficiary for the
Distribution Calendar Year is the Participant's spouse, the
quotient obtained by dividing the Participant's Account
Balance by the number in the Joint and Last Survivor Table set
forth in Section 1.401(a)(9)-9 of the Treasury Regulations,
using the Participant's and spouse's attained ages as of the
Participant's and spouse's birthdays in the Distribution
Calendar Year.
(2) Required minimum distributions will be determined under this
subsection (b) beginning with the first Distribution Calendar Year
and up to and including the Distribution Calendar Year that includes
the Participant's date of death.
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(c) Required Minimum Distributions After Participant's Death.
(1) Death On or After Date Distributions Begin.
(i) If the Participant dies on or after the date distributions
begin and there is a Designated Beneficiary, the minimum
amount that will be distributed for each Distribution Calendar
Year after the year of the Participant's death is the quotient
obtained by dividing the Participant's Account Balance by the
longer of the remaining Life Expectancy of the Participant or
the remaining Life Expectancy of the Participant's Designated
Beneficiary, determined as follows:
(A) The Participant's remaining Life Expectancy is
calculated using the age of the Participant in the year
of death, reduced by one for each subsequent year.
(B) If the Participant's surviving spouse is the
Participant's sole Designated Beneficiary, the remaining
Life Expectancy of the surviving spouse is calculated
for each Distribution Calendar Year after the year of
the Participant's death using the surviving spouse's age
as of the spouse's birthday in that year. For
Distribution Calendar Years after the year of the
surviving spouse's death, the remaining Life Expectancy
of the surviving spouse is calculated using the age of
the surviving spouse as of the spouse's birthday in the
calendar year of the spouse's death, reduced by one for
each subsequent calendar year.
(C) If the Participant's surviving spouse is not the
Participant's sole Designated Beneficiary, the
Designated Beneficiary's remaining Life Expectancy is
calculated using the age of the Beneficiary in the year
following the year of the Participant's death, reduced
by one for each subsequent year.
(ii) If the Participant dies on or after the date distributions
begin and there is no Designated Beneficiary as of September
30 of the year after the year of the Participant's death, the
minimum amount that will be distributed for each Distribution
Calendar Year after the year of the Participant's death is the
quotient obtained by dividing the Participant's Account
Balance by the Participant's remaining Life Expectancy
calculated using the age of the Participant in the year of
death, reduced by one for each subsequent year.
Page 27
(2) Death Before Date Distributions Begin.
(i) If the Participant dies before the date distributions begin
and there is a Designated Beneficiary, the minimum amount that
will be distributed for each Distribution Calendar Year after
the year of the Participant's death is the quotient obtained
by dividing the Participant's Account Balance by the remaining
Life Expectancy of the Participant's Designated Beneficiary,
determined as provided in subsection (c)(1).
(ii) If the Participant dies before the date distributions begin
and there is no Designated Beneficiary as of September 30 of
the year following the year of the Participant's death,
distribution of the Participant's entire interest will be
completed by December 31 of the calendar year containing the
fifth anniversary of the Participant's death.
(iii) If the Participant dies before the date distributions begin,
the Participant's surviving spouse is the Participant's sole
Designated Beneficiary, and the surviving spouse dies before
distributions are required to begin to the surviving spouse
under subsection (a)(2)(i), this subsection (c)(2) will apply
as if the surviving spouse were the Participant.
(d) Definitions.
(1) "DESIGNATED BENEFICIARY" means the individual who is designated as
the Beneficiary under Article VII of the Plan and is the designated
beneficiary under Section 401(a)(9) of Code and Section
1.401(a)(9)-1, Q&A-4, of the Treasury Regulations.
(2) "DISTRIBUTION CALENDAR YEAR" means the calendar year for which a
minimum distribution is required. For distributions beginning before
the Participant's death, the first Distribution Calendar Year is the
calendar year immediately preceding the calendar year which contains
the Participant's Required Beginning Date. For distributions
beginning after the Participant's death, the first Distribution
Calendar Year is the calendar year in which distributions are
required to begin under subsection (a)(2). The required minimum
distribution for the Participant's first Distribution Calendar Year
will be made on or before the Participant's Required Beginning Date.
The required minimum distribution for other Distribution Calendar
Years, including the required minimum distribution for the
Distribution Calendar Year in which the Participant's Required
Beginning Date occurs, will be made on or before December 31 of that
distribution calendar year.
Page 28
(3) "LIFE EXPECTANCY" means the life expectancy as computed by use of
the Single Life Table in Section 1.401(a)(9)-9 of the Treasury
Regulations.
(4) "PARTICIPANT'S ACCOUNT BALANCE" means the account balance as of the
last valuation date in the calendar year immediately preceding the
Distribution Calendar Year (valuation calendar year) increased by
the amount of any contributions made and allocated or forfeitures
allocated to the account balance as of dates in the valuation
calendar year after the valuation date and decreased by
distributions made in the valuation calendar year after the
valuation date. The account balance for the valuation calendar year
includes any amounts rolled over or transferred to the Plan either
in the valuation calendar year or in the distribution calendar year
if distributed or transferred in the valuation calendar year.
(5) "REQUIRED BEGINNING DATE" means the date not later than April 1 of
the calendar year following the calendar year in which the
Participant attains age seventy and one-half (70-1/2).
(e) Distributions to such Participants will be made pursuant to the terms of
this Section 5.020 and Section 5.030.
(1) With respect to the Investment Funds other than the Mindspeed Stock
Fund (which will be subject to the Participant election set forth in
subsection (2)), the Participant will receive the full dollar
balance of his or her Accounts in such Funds. Such balance will be
determined in the manner provided in Section 5.030, by reference to
the value of such Participant's interest on the date of the
Participant's retirement, layoff or termination of employment, or,
in the case of the Participant's death or disability, on the date
all documentation necessary to effect distribution has been received
by the Plan Administrator or his or her delegate.
(2) With respect to the Mindspeed Stock Fund, the Participant will, if
he or she should so elect, receive the full dollar balance of his or
her Accounts in such Fund in the manner described in the preceding
subsection or in shares of Mindspeed common stock equal in number to
the maximum number of whole shares of common stock which could be
purchased at the closing price of Mindspeed common stock on the
American Stock Exchange on that date (or, in the event such date
falls on a day on which for any reason there are no trades of such
stock reflected on such listing, the last trading day preceding that
date). In addition, the Participant will be paid in cash the value
of any partial shares of Mindspeed common stock plus the amount of
any cash
Page 29
dividends received since that date which is attributable to the
number of whole shares of common stock distributed to him or her.
5.030 FORM OF DISTRIBUTIONS TO RETIRING PARTICIPANTS. Any Participant who is
eligible for and wishes to receive a distribution under Section 5.020 on account
of his or her retirement will make an election concerning the form of
distribution and will provide such election to the Plan Administrator or the
Plan Administrator's delegate prior to retirement. The form of distribution such
a Participant may elect will be in the form of either:
(a) a lump sum payment in cash or stock; or
(b) if the value of the Participant's Accounts at the time of the
distributions is at least Ten Thousand Dollars ($10,000), ten (10) or
fewer annual installment payments, such installment payments to be equal
to the value of the Participant's Accounts as of the Valuation Date
immediately preceding distribution, divided by the number of installments
remaining at the time of each payment. The initial installment payment
will be made as soon as is practicable after the effective date of the
Participant's election, with subsequent payments during the elected
installment payment period to be made as of the annual anniversary date of
the initial installment payment.
If a Participant who had previously retired and commenced receipt of installment
payments pursuant to subsection (b) returns to employment with the Company or an
Affiliated Company, such installment payments will be suspended until the
Participant's subsequent retirement, at which time he or she would be permitted
again to make the election described therein. In the event that no election
concerning the form of retirement distribution has been made by a retired
Participant by the end of the calendar year in which he or she has attained age
seventy and one-half (70-1/2), the distribution will be made in a lump sum.
5.040 TERMINATION OF EMPLOYMENT OR SEVERANCE FROM EMPLOYMENT.
(a) Subject to Section 5.050, distributions from this Plan to Participants for
reasons other than the Participant's retirement or, in the case of a
Participant's death, distributions to a Participant's Beneficiary on
account of a termination of employment or a severance from employment will
in all cases be made in a lump sum payment in cash or stock in accordance
with an election under Section 5.040(b) by the Participant and will be
paid as soon as is practicable. If the Participant is reemployed as an
Employee, the Participant will not have any further right to receive a
distribution of benefits as a result of his or her prior termination of
employment or severance from employment.
Page 30
(b) With respect to the Mindspeed Stock Fund, the Participant will, if he or
she should so elect, receive the full dollar balance of his or her
Accounts in such Fund in a lump sum cash payment or in shares of Mindspeed
common stock equal in number to the maximum number of whole shares of
common stock which could be purchased at the closing price of Mindspeed
common stock on the American Stock Exchange on that date (or, in the event
such date falls on a day on which for any reason there are no trades of
such stock reflected on such listing, the last trading day preceding that
date). In addition, the Participant will be paid in cash the value of any
partial shares of Mindspeed common stock plus the amount of any cash
dividends received since that date which is attributable to the number of
whole shares of common stock distributed to him or her.
5.050 CASH-OUT AND AUTOMATIC ROLLOVER RULES.
(a) Notwithstanding any other provision of the Plan to the contrary, if a
Participant separates from service and the aggregate value of the
Participant's Accounts exceeds Five Thousand Dollars ($5,000) (determined
without regard to the value of the Participant's Rollover Contributions
Account), no distribution of benefits under the Plan will be made, unless
the Plan Administrator or his or her delegate will first have obtained the
Participant's consent thereto. In the event such consent is not so
obtained, the Participant's Accounts will be retained by the Plan and will
be maintained and valued in accordance with Article IV. Distribution of
the Participant's Accounts pursuant to this Section will be made following
the date on which the Participant's consent to such distribution is
obtained in the same manner as if the Participant had separated from
service on such date.
(b) Effective for distributions on and after March 28, 2005, if: (1) a
Participant separates from service and the aggregate value of the
Participant's Accounts exceeds One Thousand Dollars ($1,000) (determined
with regard to the value of the Participant's Rollover Contributions
Account) but does not exceed Five Thousand Dollars ($5,000) (determined
without regard to the value of the Participant's Rollover Contributions
Account) at the time of the Participant's separation from service,
Participant's Rollover Contributions Account, and (2) such Participant
does not elect to have such distribution paid directly to an Eligible
Retirement Plan specified by the Participant in a direct rollover under
Section 5.060 or to receive the distribution directly in accordance with
Article V, then the Plan Administrator will pay the distribution of the
Participant's Accounts in a direct rollover to an individual retirement
account in designated by the Plan Administrator and in the name of such
Participant.
(c) Effective for distributions on and after March 28, 2005, if a Participant
separates from service and the aggregate value of the Participant's
Accounts is no more than
Page 31
One Thousand Dollars ($1,000) (determined with regard to the value of the
Participant's Rollover Contributions Account), at the time of the
Participant's separation from service, subject to Section 5.060, then the
Participant will receive a distribution of the value of the Participant's
Accounts in a lump sum payment in cash.
5.060 TRANSFER OF DISTRIBUTION DIRECTLY TO ELIGIBLE RETIREMENT PLAN. If a
Participant, a Participant's spouse entitled to distribution as his or her
Beneficiary pursuant to Article VII or a former spouse entitled to distribution
pursuant to Section 9.120(b) requests in writing, the Plan Administrator will
cause all or a portion of the amounts (including shares of Mindspeed common
stock) to be transferred from the Trustee directly to the custodian of an
Eligible Retirement Plan specified by the Participant. Such request will be
made, in the case of a Participant, at the time his or her consent to such
distribution will be given to the Plan Administrator pursuant to Section 5.050,
or at such later date as the Plan Administrator will permit, or, in the case of
the Participant's spouse or former spouse, at such time as the Plan
Administrator will determine. Prior to effecting such a transfer, the Plan
Administrator will have the authority to require evidence reasonably
satisfactory to him or her that the entity to which such transfer is to be made
is in fact an Eligible Retirement Plan and that such Eligible Retirement Plan
may receive the distribution in the forms required under this Article.
ARTICLE VI: WITHDRAWALS AND LOANS
6.010 WITHDRAWALS FROM ACCOUNTS BY PARTICIPANTS UNDER AGE 59-1/2.
(a) A Participant who has not yet attained age fifty-nine and one-half
(59-1/2) may elect while still employed with the Company to withdraw
certain amounts from his or her Accounts. As soon as practicable after the
Company's receipt of such an election, there will be paid or transferred
to such Participant cash and, if applicable, stock from his or her
Accounts in the following order:
(1) first, from that portion of his or her Post-Tax Contribution Account
which is attributable to his or her Supplemental Post-Tax
Contributions;
(2) second, from that portion of his or her Post-Tax Contribution
Account which is attributable to his or her Basic Post-Tax
Contributions; and
(3) third, from his or her Rollover Contributions Account(s).
Withdrawals from a Participant's Pre-Tax Contribution Account prior to his or
her attainment of age fifty-nine and one-half (59-1/2) will only be permitted
upon the
Page 32
occurrence of a Hardship and will be administered pursuant to Section 6.030. In
addition, withdrawals from the Participant's Company Matching Contribution
Account and Company Profit Sharing Contribution Account prior to his or her
attainment of age fifty-nine and one-half (59-1/2) will not be permitted.
(b) Withdrawals pursuant to subsection (a) may be made by a Participant at any
time and with no minimum amount required, but will be limited to one
withdrawal every six (6) months.
6.020 WITHDRAWALS FROM ACCOUNTS BY PARTICIPANTS OVER AGE 59-1/2.
(a) A Participant who has attained age fifty-nine and one-half (59-1/2) while
still employed by the Company may elect to withdraw any or all of the
amounts in his or her Accounts. A Participant making such an election will
receive the amount of cash or, if applicable, stock to be withdrawn from
his or her Accounts in the following order:
(1) first, from that portion of his or her Post-Tax Contribution Account
which is attributable to his or her Supplemental Post-Tax
Contributions;
(2) second, from that portion of his or her Post-Tax Contribution
Account which is attributable to his or her Basic Post-Tax
Contributions;
(3) third, from his or her Rollover Contributions Account(s);
(4) fourth, from that portion of his or her Pre-Tax Contribution Account
which is attributable to his or her Supplemental Pre-Tax
Contributions and from his or her Catch-Up Pre-Tax Contributions;
(5) fifth, from that portion of his or her Pre-Tax Contribution Account
which is attributable to his or her Basic Pre-Tax Contributions;
(6) sixth, from that portion of his or her Company Matching Contribution
Account which is attributable to his or her Company Matching
Contributions associated with his or her Basic Post-Tax
Contributions and his or her Supplemental Post-Tax Contributions;
(7) seventh, from that portion of his or her Company Matching
Contribution Account which is attributable to his or her Company
Matching Contributions associated with his or her Basic Pre-Tax
Contributions and his or her Supplemental Pre-Tax Contributions; and
(8) eighth, from his or her Company Profit Sharing Contribution Account.
Page 33
(b) Withdrawals pursuant to subsection (a) may be made by a Participant at any
time and with no minimum amount required, but will be limited to one
withdrawal every six (6) months.
6.030 HARDSHIP WITHDRAWALS FROM PRE-TAX CONTRIBUTION ACCOUNTS. Subject to any
restrictions the Plan Administrator may establish pursuant to Section 6.050, the
following provisions may apply in the event of the occurrence of a Hardship:
(a) An Employee who has not attained age fifty-nine and one-half (59-1/2) may
request approval of the Administrative Committee to withdraw some or all
of the balance of his or her Pre-Tax Contribution Accounts (including his
or her Catch-up Pre-Tax Contribution Account), if the Employee
demonstrates that the withdrawal is required as a result of a Hardship
(including payment of any federal, state or local income taxes and
penalties reasonably anticipated to result from such Hardship withdrawal).
(b) Any determination of the existence of a Hardship, the reasonable
availability to the Employee of funds from other sources and the amount
necessary to be withdrawn on account of such Hardship will be made by the
Administrative Committee on the basis of all relevant facts and
circumstances and in accordance with the provisions of this Section and
Section 1.270, as applied in a uniform and nondiscriminatory manner. In
making such determination, the Administrative Committee may, if it is
reasonable to do so in light of all relevant and known facts and
circumstances, rely on the Employee's representation that the Hardship
cannot be relieved:
(1) by reimbursement or compensation by insurance or otherwise;
(2) by reasonable liquidation of the Employee's assets, to the extent
that such liquidation would not itself cause an immediate and heavy
financial need;
(3) by suspension of Participant Contributions to the Plan; or
(4) by other distributions (other than Hardship distributions) or loans
(which meet the requirements of Section 72(p) of the Code) from the
Plan and any other plan maintained by an Affiliated Company or by
any former employer or by borrowing from commercial sources at
reasonable commercial rates.
(c) An individual who receives a Hardship distribution pursuant to this
Section prior to his or her attainment of age fifty-nine and one-half
(59-1/2) will not be permitted to make any Participant Contributions to
the Plan during the six (6) months immediately following his or her
receipt of the said Hardship distribution. In
Page 34
addition, such Hardship distributions will only be available to
Participants hereunder once every six (6) months.
6.040 ALLOCATION OF WITHDRAWALS AMONG INVESTMENT FUNDS. Withdrawals made
pursuant to the three preceding sections will be taken from the Employee's
Accounts in the Investment Funds in a pro rata fashion, based upon the relative
size of such Accounts; provided, however, that a Participant will be permitted,
if he or she so desires, to designate the Investment Funds from which such
withdrawals will be taken.
6.050 LOANS. The Plan Administrator will establish, and may from time to time
modify, procedures pursuant to which any Employee or other "party in interest"
(as defined in ERISA Section 3(14)) may apply for and receive a loan from the
Plan, in an amount not exceeding the least of (a), (b), (c) or (d):
(a) the aggregate of the balances (including amounts attributable to Rollover
and Transfer Contributions) in the borrower's Pre-Tax Contribution and
Post-Tax Contribution Accounts;
(b) an amount which, when combined with all outstanding loans to the borrower
from all other plans of all Affiliated Companies, equals Fifty Thousand
Dollars ($50,000), reduced by the excess, if any, of:
(1) the highest outstanding and unpaid balances of all prior loans to
the borrower from the Plan and such other plans during the twelve
(12)-month period immediately preceding the date on which such loan
is made; over
(2) the outstanding balance of any loan to the borrower from the Plan or
such other plans on the date on which the loan is made;
(c) one-half (1/2) of the aggregate of the balances of the borrower's
Accounts; or
(d) such amount, not exceeding the amounts described in (a) through (c) above,
as the Plan Administrator will determine.
All such loans will be made available to all Eligible Employees and other
parties in interest on a reasonably equivalent and non-discriminatory basis and
will be governed by the provisions of Appendix A, as such Appendix is from time
to time constituted, pursuant to the determination of the Plan Administrator.
6.060 TRANSFERS TO CERTAIN AFFILIATED COMPANY PLANS. A Participant who though
remaining an Employee is no longer an Eligible Employee may elect, if his or her
continuing employment is with an Affiliated Company, to have the entire amount
credited to his or her Accounts in this Plan transferred to any qualified
individual account
Page 35
plan of the said Affiliated Company; provided, however, that such transferred
amount will consist of and be limited to:
(a) cash, in the case of amounts attributable to the Participant's interest in
Investment Funds other than the Mindspeed Stock Fund;
(b) Mindspeed common stock, in the case of amounts attributable to the
Participant's interest, if any, in the Mindspeed Stock Fund; and
(c) in the case of a Participant to whom a loan has been made pursuant to
Section 6.050, the Participant's loan.
6.070 TRANSFER OF DISTRIBUTION OR WITHDRAWAL TO ELIGIBLE RETIREMENT PLAN. If a
Participant entitled to a distribution under Article V or an in-service
withdrawal, other than an in-service withdrawal described in Section 6.030,
under this Article VI, requests in writing at the time his or her election to
receive such distribution or withdrawal is made or at such later date as the
Plan Administrator may permit, the Plan Administrator will cause all or a
portion of the amounts (including shares of common stock) to be transferred from
the Trustee directly to the custodian of an Eligible Retirement Plan specified
by the Participant. Prior to effecting such transfer, the Plan Administrator
will require evidence reasonably satisfactory to him or her that the entity to
which such transfer is to be made is in fact an Eligible Retirement Plan and
that such Eligible Retirement Plan may receive the distribution in the forms
required under this Article VI.
ARTICLE VII: DEATH BENEFITS
7.010 DESIGNATION OF A BENEFICIARY. Subject to the provisions of Section 1.110:
(a) If a Participant dies, payment of the benefits provided under this Plan
will be made to such person or persons as he or she has designated as his
or her Beneficiary to receive such benefits in the event of his or her
death.
(b) A Participant may change his or her designation of Beneficiary at any time
by filing with the Plan Administrator (or such other person as is
designated by the Plan Administrator) a request for such change. Such
change will become effective only upon receipt of the request by the Plan
Administrator (or the Plan Administrator's delegate), but upon such
receipt, the change will relate back to and be effective as of the date
the Participant signed such request; provided, however, that the Plan
Administrator, the other named fiduciaries and the Trust Fund will not be
liable in any way or to any degree for any payment made to the Beneficiary
designated before receipt of such request.
Page 36
(c) If no designation is effective pursuant to this Article or if the Plan
Administrator or Trustee has any doubt as to the right of any Beneficiary
or if the Beneficiary predeceases the Participant, the amount of such
benefits may be paid to the estate of the Participant, in which event the
Plan Administrator, such other named fiduciaries and the Trust Fund will
not be liable in any manner and to any degree with respect to such
payment.
7.020 PAYMENT TO A BENEFICIARY. Upon receipt by the Plan Administrator (or
another person designated by him) of evidence satisfactory to such person of the
death of a Participant and of the identity and existence at the time of such
death of the Beneficiary, the Plan Administrator will direct the Trustee to pay
the Participant's Accounts to such Beneficiary.
ARTICLE VIII: TRUST AGREEMENT
8.010 ESTABLISHMENT OF TRUST FUND. The property resulting from contributions
made on behalf of all Participants, including contributions made by the Company,
will be held in a Trust Fund by a Trustee selected by the Plan Committee
pursuant to a Trust Agreement entered into between such Trustee and the Plan
Committee.
8.020 INVESTMENT FUNDS OF THE TRUST. The Trustee will establish and maintain as
parts of the Trust Fund individual Investment Funds (which may be mutual funds
or collective funds, accounts or other similar investment vehicles), each of
which will consist of and be identical to the individual Plan Investment Funds
described in Appendix B, as the said Appendix will be from time to time
constituted. The said Investment Funds, as from time to time established and
maintained (including the investment objectives and general descriptions of the
forms of securities or other property held in such Funds), will be as set forth
in the said Appendix B.
8.030 TRUSTEE'S POWERS AND AUTHORITY. Subject to the provisions of Section 8.050
concerning certain power and authority connected with Mindspeed common stock
which will be held in the Mindspeed Stock Fund, the Trustee will have full
authority and discretion with respect to management of the assets of the Trust
Fund, including management of the assets of the individual Investment Funds held
thereunder.
8.040 STATUTORY LIMITS. In making all investments pursuant to this Plan, the
Trustee will:
(a) be subject to applicable provisions of ERISA governing the exercise of its
fiduciary responsibilities on behalf of the Trust Fund and this Plan, as
well as to all applicable securities laws governing the investments of the
Trust Fund (including
Page 37
any investment companies or mutual funds therein), but will not be bound
by any law or any court doctrine of any state or jurisdiction limiting
trust investments, except as otherwise provided or permitted by ERISA;
(b) at all times give consideration to the cash requirements of the Plan; and
(c) not cause the Plan to engage in any transaction constituting a prohibited
transaction under Section 406 of ERISA.
8.050 DUTY OF TRUSTEE AS TO COMMON STOCK IN THE MINDSPEED STOCK FUND. Except as
is otherwise provided in this Section:
(a) The duty with respect to the voting, retention, and tendering of Mindspeed
common stock held in the Mindspeed Stock Fund will be solely that of the
Trustee, to be exercised solely in the Trustee's discretion.
(b) With respect to any matter as to which a vote of the outstanding shares of
Mindspeed common stock is solicited:
(1) The Trustee will solicit the direction in writing of each
Participant as to the manner in which voting rights of shares of
Mindspeed common stock held in or credited to the Mindspeed Stock
Fund with respect to such Participant as of the record date fixed
for determining the holders entitled to vote on such matter are to
be exercised, and the Trustee will exercise the voting rights of
such shares with respect to such matter in accordance with the last
dated timely written direction, if any, of such Participant.
(2) The Trustee will exercise voting rights of shares of Mindspeed
common stock held in the Mindspeed Stock Fund as to which no timely
direction has been received pursuant to paragraph (1) in the same
proportion as it votes those shares for which it has received timely
written directions from Participants pursuant to subsection (1).
(c) In the event of any tender offer involving Mindspeed common stock:
(1) The Trustee will solicit the direction in writing of each
Participant, as to the tendering or depositing of any shares of
Mindspeed common stock held in the Mindspeed Stock Fund with respect
to such Participant and, except as limited by subsection (d) hereof,
will tender or deposit such shares pursuant to any such tender offer
in accordance with the last dated timely written direction, if any,
of such Participant.
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(2) The Trustee will not tender or deposit shares of Mindspeed common
stock held in the Mindspeed Stock Fund as to which no timely written
direction has been received pursuant to subsection (1).
(d) Shares of Mindspeed common stock held in the Mindspeed Stock Fund will not
be tendered or deposited by the Trustee pursuant to any such tender offer
until the earlier of:
(1) immediately preceding the scheduled expiration of the tender offer
pursuant to which such shares are to be tendered or deposited;
(2) immediately preceding the expiration of the period during which such
shares of Mindspeed common stock will be taken up and paid for on a
pro rata basis pursuant to such tender offer; or
(3) the expiration of thirty (30) days from the date of the Trustee's
solicitation of Participants' written direction pursuant to
subsection (c)(1).
(e) With respect to the withdrawal of, or other exercise of any right to
withdraw, shares of common stock which have been tendered or deposited in
accordance with a timely written direction of a Participant pursuant to
subsection (c), a Participant may direct the Trustee to withdraw some or
all of the shares tendered or deposited, and the Trustee will withdraw the
directed number of shares from the tender offer, prior to the tender offer
withdrawal deadline. As used herein, the term "Tender Date" means the date
on which the Trustee tenders or deposits any shares of Mindspeed common
stock representing the interest of such Participant in the Mindspeed Stock
Fund.
8.060 RIGHTS IN THE TRUST FUND. Nothing in the Plan or in the Trust Agreement
will be deemed to confer any legal or equitable right or interest in the Trust
Fund in favor of any Participant, Beneficiary or other person, except to the
extent expressly provided in the Plan.
8.070 TAXES, FEES AND EXPENSES OF THE TRUSTEE.
(a) The reasonable fees and expenses of the Trustee (including the reasonable
expenses of the Trustee's counsel) will be paid from the Trust Fund and
will constitute a charge on the Trust Fund until so paid; provided,
however, that in no event will the Trust Fund or the Company (unless the
Company is specifically so directed by resolution of the Company's Board
of Directors) pay any such Trustee fees or expenses:
Page 39
(1) for preparation or prosecution of any action against the Company,
the Plan, any member of the Plan Committee or the Plan
Administrator; or
(2) for the defense or settlement of, or the satisfaction of a judgment
related to, any proceeding arising either out of any alleged
misfeasance or nonfeasance in any person's performance of duties
with respect to the Plan or out of any alleged wrongful act against
the Plan.
There will be included in the reasonable expenses payable from the Trust Fund
any direct internal costs (which may include reimbursement of compensation of
Company Employees) associated with Plan operations and administration, the
payment of which will be in conformity with the requirements of Title I of
ERISA. Neither the Plan Administrator nor the members of the Plan Committee will
be compensated from the Plan but may be compensated by the Company for services
rendered on behalf of the Plan.
(b) Brokerage fees, commissions, stock transfer taxes and other charges and
expenses incurred in connection with transactions relating to the
acquisition or disposition of property for or of the Trust Fund, or
distributions therefrom, will be paid from the Trust Fund. Taxes, if any,
payable by the Trustee on the assets at any time held in the Trust Fund or
on the income thereof will be paid from the Trust Fund.
ARTICLE IX: ADMINISTRATION
9.010 GENERAL ADMINISTRATION. Authority to control and manage the operation and
administration of the Plan will be vested in the Plan Committee except to the
extent that:
(a) the Plan Administrator or the Administrative Committee is allocated any
such authority under the Plan;
(b) the Trustee may, pursuant to Article VIII, be granted exclusive authority
and discretion to manage and control all or any portion of the assets of
the Plan; and
(c) the Plan Committee, the Plan Administrator, the Administrative Committee
and the Trustee will constitute ERISA named fiduciaries of the Plan.
9.020 PLAN COMMITTEE. The Board of Directors will, from time to time, determine
the size of the Plan Committee and appoint its individual members. The Plan
Committee will act, with or without a meeting, in a manner consistent with the
rules and regulations adopted pursuant to Section 9.060(d).
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9.030 PLAN COMMITTEE RECORDS. The Plan Committee will keep such records and data
as it will deem appropriate and it will from time to time file with the Board of
Directors such reports as the latter may request. It will be a function of the
Plan Committee to keep records of the assets of the Trust Fund, based upon
reports furnished by the Trustee, and the evaluations placed thereon by the
Committee will be final and conclusive.
9.040 FUNDING POLICY. The Plan Committee will be responsible for determining a
funding policy of the Plan and will from time to time advise the Trustee of such
policy.
9.050 ALLOCATION AND DELEGATION OF DUTIES UNDER THE PLAN. The Plan Committee,
the Plan Administrator and the Administrative Committee will each have the
following powers and authorities:
(a) to designate agents to carry out responsibilities relating to the Plan,
other than fiduciary responsibilities; and
(b) to employ such legal, consultant, medical, accounting, clerical and other
assistance as it may deem appropriate in carrying out the provisions of
this Plan, including one or more persons to render advice with regard to
any responsibility any fiduciary may have under the Plan.
9.060 PLAN COMMITTEE POWERS. In addition to any powers and authority conferred
on the Plan Committee elsewhere in the Plan or by law, the Plan Committee will
have the following powers and authority:
(a) to allocate fiduciary responsibilities, other than trustee
responsibilities (responsibilities under the Trust Agreement to manage or
control the Plan assets) to one or more members of the Plan Committee or
to the Plan Administrator and to designate one or more persons (other than
the Trustee) to carry out such fiduciary responsibilities;
(b) to determine the manner in which the assets of this Plan, or any part
thereof, will be disbursed by the Trustee, except as relates to the making
and retention of investments; and
(c) to establish rules and regulations from time to time for the conduct of
the Plan Committee's business and for the administration and effectuation
of its responsibilities under the Plan.
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9.070 PLAN ADMINISTRATOR. In addition to any powers and authority conferred on
the Plan Administrator elsewhere in the Plan, the Plan Administrator will have
the following powers and authority:
(a) to administer, interpret, construe and apply this Plan and to decide all
questions which may arise or which may be raised by any Employee,
Participant, Beneficiary, or other person whatsoever, and the actions or
decisions of the Plan Administrator in regard thereto, or in regard to
anything or any matter otherwise within his or her discretion, will be
conclusive and binding on all Employees, Participants, Beneficiaries, and
other persons whatsoever;
(b) to designate one or more persons, other than the Trustee, to carry out
fiduciary responsibilities (other than trustee responsibilities); and
(c) to establish rules and regulations from time to time for the
administration and effectuation of his or her responsibilities under the
Plan.
The Plan Administrator will have such other responsibility as is designated by
ERISA as the responsibility of the administrator of the Plan and will have such
other power and authority as is necessary to fulfill his or her responsibilities
under ERISA or under the Plan.
9.080 RELIANCE UPON DOCUMENTS AND OPINIONS. The members of the Plan Committee
and the Administrative Committee, the Plan Administrator, the Board of Directors
and the Company will be entitled to rely upon any tables, valuations,
computations, estimates, certificates and reports furnished by any consultants
or consulting firms, opinions furnished by legal counsel and reports furnished
by the Trustee. The members of the Plan Committee, the Plan Administrator, the
Board of Directors and the Company will be fully protected and will not be
liable in any manner whatsoever, except as otherwise specifically provided by
law, for anything done or any action taken or suffered in reliance upon any such
consultant, Trustee or counsel. Any and all such things done or such actions
taken or suffered by the Plan Committee, the Plan Administrator, the Board of
Directors and the Company will be conclusive and binding on all Employees,
Participants, Beneficiaries, and other persons whatsoever except as otherwise
specifically provided by law. The Plan Committee and the Plan Administrator may,
but are not required to, rely upon all records of the Company with respect to
any matter or thing whatsoever, and to the extent they rely thereon, such
records will be conclusive with respect to all Employees, Participants, and
Beneficiaries.
9.090 REQUIREMENT OF PROOF. The Plan Committee, the Plan Administrator, the
Administrative Committee, the Board of Directors or the Company may require
satisfactory proof of any matter under this Plan from or with respect to any
Employee,
Page 42
Participant or Beneficiary, and no such person will acquire any rights or be
entitled to receive any benefits under this Plan until such proof will be
furnished as so required.
9.100 LIMITATION ON LIABILITY AND INDEMNIFICATION. Except as provided in Part 4
of Title I of ERISA, no person will be subject to any liability with respect to
his or her duties under the Plan, unless he or she acts fraudulently or in bad
faith. No person will be liable for any breach of fiduciary responsibility
resulting from the act or omission of any other fiduciary or any person to whom
fiduciary responsibilities have been allocated or delegated, except as provided
in ERISA Section 405(a) and Section 405(c)(2)(A) or (B). No action or
responsibility will be deemed to be a fiduciary action or responsibility except
to the extent required by ERISA. To the extent permitted by law, the Company
will indemnify the Board of Directors, the Plan Administrator, each member of
the Plan Committee, each member of the Administrative Committee and any other
employee of the Company with duties under the Plan against expenses (including
any amount paid in settlement) reasonably incurred by him or her in connection
with any claims against him or her by reason of his or her conduct (except for
his or her willful misconduct) in the performance of his or her duties under the
Plan.
9.110 MAILING AND LAPSE OF PAYMENTS. All payments under the Plan will be
delivered in person or mailed to the last address of the Participant (or, in the
case of the death of the Participant, to the last address of any other person
entitled to such payments under the terms of the Plan) furnished pursuant to
Section 9.150 below. If the Plan Administrator cannot, by making a reasonably
diligent attempt by mail, locate either the Participant or his or her
Beneficiary, as the case may be, for a period of seven (7) years, such
Participant or Beneficiary will be presumed dead. If payment cannot be made
alternatively to the estate of either and no surviving spouse, child,
grandchild, parent, brother or sister of the Participant or his or her
Beneficiary are known to the Plan Administrator or the Trustee or, if known,
cannot with reasonable diligence be located, the amount payable will be retained
by the Trustee until the amount can be distributed pursuant to the provisions of
this Plan or of applicable law.
9.120 NON-ALIENATION. No right or benefit provided for in the Plan will be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance (including garnishment, attachment, execution or levy of any
kind or charge) and any attempt to anticipate, alienate, sell, transfer, assign,
pledge, encumber or charge the same will be void; provided, however, that the
foregoing will not apply to the creation, assignment or recognition of a right
to any benefit payable with respect to a Participant pursuant to:
(a) a levy for federal income tax issued against the Participant by the
Internal Revenue Service;
Page 43
(b) a domestic relations order, which the Plan Administrator determines is a
qualified domestic relations order under Section 414(p) of the Code and
which requires that the order's alternate payee (as defined in the said
Code section) will be paid in a lump sum as soon as is practicable
following the order's issuance; or
(c) an offset of a Participant's benefit for a criminal conviction relating to
the Plan or for a civil judgment for breach of fiduciary duty with respect
to the Plan in accordance with an order, judgment or settlement by the
Plan against the Participant in accordance with Section 401(a)(13)(C) of
the Code.
9.130 NOTICES AND COMMUNICATIONS. Each Participant will be responsible for
furnishing the Plan Administrator with his or her current address and the
correct current name and address of his or her Beneficiary. All communications
from Participants will be in the manner from time to time prescribed by the Plan
Administrator and will be addressed or communicated (including telephonic
communications) to such entity or Company office as may be designated by the
Plan Administrator, and will be deemed to have been given to the Company when
received by such entity or Company office. Each communication directed to a
Participant or Beneficiary will be in writing and may be delivered in person or
by mail, in which latter event it will be deemed to have been delivered and
received by him or her when so deposited in the United States mail with postage
prepaid addressed to the Participant or Beneficiary at his or her last address
of record with the office designated by the Plan Administrator.
9.140 COMPANY RIGHTS. The Company's rights to discipline or discharge Employees
or to exercise its rights as to incidents and tenure of employment will not be
affected in any manner by reason of the existence of the Trust Agreement or the
Plan, or any action taken under them.
9.150 PAYMENTS ON BEHALF OF INCOMPETENT PARTICIPANTS OR BENEFICIARIES. In the
event that the Plan Administrator or his or her designee will find that any
Participant or Beneficiary to whom a benefit is payable under the terms of this
Plan is unable to care for his or her affairs because of illness or accident or
is otherwise mentally or physically incompetent, or unable to give a valid
receipt, the Plan Administrator may cause the payment becoming due to such
Participant or Beneficiary to be paid to another person for his or her benefit
without responsibility on the part of the Plan Administrator, the Plan
Committee, the Administrative Committee, the Company or the Trustee to follow
the application of such payment. Any such payment will be a payment for the
account of the Participant or Beneficiary and will operate as a complete
discharge of all liability therefor under this Plan of the Trustee, the Company,
the Plan Administrator, the Administrative Committee and the Plan Committee.
Page 44
ARTICLE X: PARTICIPANT CLAIMS
10.010 REQUIREMENT TO FILE CLAIM. A Participant wishing a distribution or
withdrawal from the Plan must present a claim, in such manner and pursuant to
such procedure established by the Plan Administrator, with the person or entity
designated by the Plan Administrator. A claimant who fails to comply with the
manner and procedure designated by the Plan Administrator will be deemed not to
have made such claim. The person or entity designated by the Plan Administrator
will approve or deny in writing within thirty (30) days any claim which has been
so presented.
10.020 APPEAL OF DENIED CLAIM. A Participant whose claim has been denied as set
forth in Section 10.010 may appeal the denial to the Plan Administrator by
filing a written appeal within sixty (60) days of the date of the denial. The
Participant or his or her representative will, for the purpose of preparation of
such appeal, have the right to inspect any document (including computerized
records) relied upon by the Plan Administrator's representative in denying the
claim. The Plan Administrator or his or her delegate will make a final, full and
fair review of any such decision which is appealed. A decision which is not
appealed within the time herein provided will be final and conclusive as to any
matter which was presented to the person making such decision.
ARTICLE XI: AMENDMENT, MERGERS, TERMINATION, ETC.
11.010 AMENDMENT. The Board of Directors may, at any time and from time to time,
amend this Plan in whole or in part. However, except as provided in Section
14.040 below, no amendment will be made the effect of which would be:
(a) to cause any contributions paid to the Trustee to be used for or diverted
to purposes other than providing benefits to the Participants and their
Beneficiaries, and defraying reasonable expenses of administering the
Plan, prior to satisfaction of all liabilities with respect to
Participants and their Beneficiaries;
(b) to have any retroactive effect so as to deprive any Participant or
Beneficiary of any benefit to which he or she would be entitled under this
Plan if his or her employment were terminated immediately before such
amendment; or
(c) to increase the responsibilities or liabilities of the Trustee without its
written consent.
11.020 TRANSFER OF ASSETS AND LIABILITIES. The Plan Committee at any time may,
in its sole discretion without the consent of the Participant or his or her
representative, cause the Trustee to segregate part of the assets of the Trust
Fund into one or more separate
Page 45
trust funds and designate a group of Participants whose benefits will be
provided solely from each such segregated fund. The Board of Directors may, in
its sole discretion without the consent of any Participant or his or her
representative, establish a separate plan to cover any such group of
Participants. The initial terms and conditions of any such plan will be
identical to the extent such terms and conditions affect the rights of
Participants under the Plan. Amendment to the Plan will not be necessary to
carry out the provisions of this Section.
11.030 MERGER RESTRICTION. Notwithstanding any other provision in this Plan, the
Plan will not in whole or in part merge or consolidate with, or transfer its
assets or liabilities to any other plan unless each affected Participant in this
Plan would (if the Plan then terminated) receive a benefit immediately after the
merger, consolidation, or transfer which is equal to or greater than the benefit
he or she would have been entitled to receive immediately before the merger,
consolidation, or transfer (if the Plan had then terminated).
11.040 SUSPENSION OF CONTRIBUTIONS. The Company may, without amendment of the
Plan and without the consent of any Participant or representative of any
Participant, suspend contributions to the Plan as to all or certain Participants
by action of the Board of Directors. In any event, the Company will suspend
contributions at any time when the amount of any contribution by it would be in
excess of the earnings, including retained earnings, of the Company. Upon a
suspension, the Plan Committee may, in its sole discretion, permit the Trust
Fund to continue to be held by the Trustee, or may segregate one or more parts
of the Trust Fund, as provided in Section 11.020.
11.050 DISCONTINUANCE OF CONTRIBUTIONS. The Company may, by action of the Board
of Directors, without amendment of the Plan and without the consent of any
Participant or representative of any Participant, discontinue such contributions
to the Plan as to all or certain Participants.
11.060 TERMINATION. The Company, by action of its Board of Directors, may
terminate or partially terminate the Plan at any time. Upon such termination or
partial termination of the Plan, or upon a complete discontinuance of
contributions pursuant to Section 11.050, the Accounts of each affected
Participant will remain fully vested and nonforfeitable. In the event of
termination or partial termination the Plan Committee may, without the consent
of any Participant or other person, permit the Trustee to retain all or part of
the Trust Fund or distribute all or part of the Trust Fund to the Participants
or their spouses or Beneficiaries.
Page 46
ARTICLE XII: STATUTORY LIMITATIONS
12.010 ANNUAL LIMITS OF PARTICIPANT'S ACCOUNT INCREASES. This Article is
intended to conform the Plan to the requirements of Section 415 of the Code, and
the regulations issued thereunder, and will be administered and interpreted in
accordance with such requirements and regulations; and notwithstanding any
provision of this Plan to the contrary, no amount will be credited to any
Participant's Account which is in excess of the limitation imposed by said
Section 415, as from time to time amended or replaced. Except to the extent
permitted by Section 2.050 of the Plan, and Section 414(v) of the Code, if
applicable, the amount allocated in each Limitation Year to any Participant
under the combination of defined contribution plans of all Affiliated Companies
cannot exceed the lesser of Forty Thousand Dollars ($40,000) (or such larger
amount as may be established under Section 415(d)(1)(B) of the Code to reflect
an increase in the cost of living for the Plan Year which ends in the year in
which the increase occurs) or one hundred percent (100%) of the Participant's
Compensation. The percentage limit described above will not apply to any
contribution for medical benefits after separation from service (within the
meaning of Section 401(h) or Section 419A(f)(2) of the Code) which is otherwise
treated as an annual limit under this Section 12.010 of the Plan.
For purposes of this Article XII, Limitation Year means the Plan Year and
Compensation means wages as defined in Section 3401(a) of the Code for purposes
of income tax withholding at the source, but determined without regard to any
rules that limit the remuneration included in wages based on the nature or
location of the employment or the services performed and including amounts
described in Section 415(c)(3)(D) of the Code. For purposes of this limitation,
the amount allocated will be deemed to be comprised of Company Matching
Contributions, Company Profit Sharing Contributions, the Participant's Pre-Tax
Contributions (excluding Catch-Up Pre-Tax Contributions described in Section
2.050 of the Plan) and the Participant's Post-Tax Contributions.
12.020 COMBINING SIMILAR PLANS. For purposes of this Article, all defined
contribution plans which are required to be aggregated under Section 414(b) of
the Code will be so aggregated and the limitation set forth herein will be
applied to the total amounts allocated under all such plans.
12.030 CORRECTING CONTRIBUTIONS IN EXCESS OF ANNUAL LIMITS. If it is determined
that the provisions of Section 12.010 and 12.020 have not be satisfied for any
Limitation Year and a Participant received an amount in excess of the
limitations provided in Code Section 415(c), the excess will be disposed of as
follows:
(a) First, any Supplemental Post-Tax Contributions (plus attributable
earnings), to the extent they would reduce the excess amount, will be
distributed to the Participant.
Page 47
(b) Second, if after the application of paragraph (a) an excess amount still
exists, any Basic Post-Tax Contributions (plus attributable earnings), to
the extent they will reduce the excess amount, will be distributed to the
Participant. In addition, any Company Matching Contributions related to
such Basic Post-Tax Contributions (plus attributable earnings) will be
forfeited.
(c) Third, if after application of paragraph (b) an excess amount still
exists, any Supplemental Pre-Tax Contributions and Catch-Up Contributions,
if any (plus attributable earnings, in each case), to the extent they
would reduce the excess amount, will be distributed to the Participant.
(d) Fourth, if after application of paragraph (c) an excess amount still
exists, any Basic Pre-Tax Contributions (plus attributable earnings), to
the extent they would reduce the excess amount, will be distributed to the
Participant. In addition, any Company Matching Contributions related to
such Basic Pre-Tax Contributions (plus attributable earnings) will be
forfeited.
(e) Fifth:
(1) if after the application of paragraph (d) an excess amount still
exists and the Participant is covered by the Plan at the end of a
Limitation Year, the excess amount in the Participant's Account will
be used to reduce Company Matching Contributions and/or Company
Profit Sharing Contributions for such Participant in the next
Limitation Year, and each succeeding Limitation Year, if necessary.
(2) if after the application of paragraph (d) above an excess amount
still exists and the Participant is not covered by the Plan at the
end of a Limitation Year, the excess amount will be held unallocated
in a suspense account. The suspense account will be applied to
reduce future Company Matching Contributions and/or Company Profit
Sharing Contributions for all remaining Participants in the
Limitation Year, and each succeeding Limitation Year, if necessary.
(f) If a suspense account is in existence at any time during a Limitation Year
pursuant to this Section 12.030, the suspense account will not participate
in the allocation of investment gains and losses. If a suspense account is
in existence at any time during a particular Limitation Year, all amounts
in the suspense account must be allocated and reallocated to Participants'
Accounts before any Company Matching Contributions and/or Company Profit
Sharing Contributions or any Participant Contributions may be made to the
Plan for that Limitation Year. Excess amounts may not be distributed to
Participants or former Participants.
Page 48
ARTICLE XIII: TOP HEAVY PROVISIONS
13.010 DEFINITIONS. Solely for purposes of this Article, the following special
definitions will apply:
(a) "TOP HEAVY PLAN" means a qualified retirement plan, including this Plan if
applicable, which is included in, or which constitutes, an Aggregation
Group under which, as of the Determination Date, the sum of the present
values of accrued benefits for all Key Employees under all defined benefit
plans in the Aggregation Group and the aggregate of all accounts of Key
Employees under all defined contribution plans in the Aggregation Group
exceeds sixty percent (60%) of the sum of the present values of accrued
benefits under all such defined benefit plans and of all accounts under
all such defined contribution plans for all participants under such plans.
The present value of accrued benefits and the amounts of Account balances
of an Employee or Former Employee as of the Determination Date will be
increased by the distributions made with respect to an Employee or Former
Employee under the Plan and plan aggregated with the Plan under Section
416(g)(2) of the Code during the one (1)-year period ending on the
Determination Date. The preceding sentence will also apply to a terminated
plan which, had it not been terminated, would have been aggregated with
the Plan under Section 416(g)(2)(A)(i) of the Code. In the case of a
distribution made for a reason other than separation from service, death,
or disability, this provision will be applied by substituting "5-year
period" for "1-year period". The accrued benefits and accounts of any
individual who has not performed services for an Affiliated Company during
the one (1)-year period ending on the Determination Date will not be taken
into account.
(b) "KEY EMPLOYEE" means each Employee or former Employee (including any
deceased Employee or Former Employee) who has, at any time during the plan
year that includes the Determination Date, performed services for an
Affiliated Company and who is, at any time during the plan year ending on
the Determination Date, any one or more of the following:
(1) an officer of the Affiliated Company having annual compensation
greater than One Hundred Thirty Thousand Dollars ($130,000) (as
adjusted Section 416(i)(1) of the Code for Plan Years beginning
after December 31, 2002);
(2) any person owning (or considered as owning within the meaning of
Section 318 of the Code, as modified by Section 416(I)(B)(iii) of
the Code more than five percent (5%) of the outstanding stock of the
Company (or
Page 49
stock having more than five percent (5%) of the total combined
voting power of all stock of the Company) (a "5 Percent Owner"); or
(3) any person who has annual compensation of more than One Hundred
Fifty Thousand Dollars ($150,000) and would be described in
subparagraph (b)(2) above, if "one percent (1%)" was substituted for
"five percent (5%)."
For purposes of determining whether a person is an officer in paragraph
(i) above, in no event will more than fifty (50) Employees or, if less
than fifty (50) Employees, the greater of three (3) Employees or ten
percent (10%) of all Employees, be considered Key Employees solely by
reason of officer status. In addition, persons who are merely nominal
officers will not be treated as officers solely by reason of their titles.
For purposes of determining whether a person has sufficient annual
compensation under paragraphs (1) and (3) above, annual compensation means
compensation within the meaning of Section 415(c)(3) of the Code. The
determination of who is a Key Employee will be made in accordance with
Section 416(i)(1) of the Code and the applicable regulations and other
guidance of general applicability issued thereunder.
(c) "DETERMINATION DATE" means the last day of the immediately preceding plan
year or, in the case of the first plan year of any plan, the last day of
such plan year.
(d) "EMPLOYEE" means not only an Employee as defined in Article I, but also
includes any beneficiary of such Employee.
(e) "AGGREGATION GROUP" means a group of plans (including this Plan)
maintained by one or more Affiliated Companies in which a Key Employee is
a participant or which is combined with this Plan in order to meet the
coverage and nondiscrimination requirements of Code Section 410 and
Section 401(a)(4). The Aggregation Group also includes those plans other
than this Plan which need not be aggregated with this Plan to meet Code
Requirements, but which are selected by the Company to be part of a
selective Aggregation Group which includes this Plan if the Aggregation
Group would continue to meet the requirements of Code Section 401(a)(4)
and Section 410 with such plans being taken into account.
(f) "NON-KEY EMPLOYEE" means any employee who is not a Key Employee. Non-Key
Employee also means an employee who is a former Key Employee.
Page 50
(g) "COMPENSATION" means compensation as described in Section 415(c)(3) of the
Code, including employer contributions made pursuant to any salary
reduction arrangement.
13.020 APPLICATION OF THIS ARTICLE. In the event that this Plan is or becomes a
Top Heavy Plan, the Plan, where aggregated with each other defined contribution
plan in the Aggregation Group in which a Key Employee is a participant, will
provide a minimum allocation to the account of each Participant who is not a Key
Employee for each plan year to which these rules apply equal to three percent
(3%) of such Participant's Compensation. Company Matching Contributions will be
taken into account for purposes of satisfying the minimum contribution
requirements of Section 416(c)(2) of the Code and this Article. Company Matching
Contributions that are used to satisfy the minimum contribution requirements
will be treated as matching contributions for purposes of the Actual
Contribution Percentage Limit and other requirements of Section 401(m) of the
Code.
ARTICLE XIV: MISCELLANEOUS
14.010 BENEFITS PAYABLE ONLY FROM TRUST FUND. All benefits payable hereunder
will be provided solely from the Trust, and the Company assumes no
responsibility for the acts of the Trustee, except as provided in the Trust
Agreement.
14.020 REQUIREMENT FOR RELEASE. Any payment to any Participant or a
Participant's present, future or former spouse or Beneficiary in accordance with
the provisions of this Plan will, to the extent thereof, be in full satisfaction
of all claims against the Trustee and the Company, and the Trustee may require
such Participant or Beneficiary, as a condition precedent to such payment, to
execute a receipt and release to such effect.
14.030 TRANSFERS OF STOCK. Transfers of Mindspeed common stock from the Trustee
pursuant to Article V or VI will be made as soon as practicable, but none of the
Company, any Named Fiduciary, or the Trustee will have any responsibility for
any decrease in the value of such common stock between the Valuation Date used
for determination of the number of shares to which the Participant is entitled
and the date of transfer by the transfer agent, nor, except as provided in
Articles V and VI, will the Participant receive any dividends, rights, options
or warrants on such stock other than those payable to stockholders of record as
of a date on or after the date of transfer.
14.040 QUALIFICATION OF THE PLAN. The Company intends for the Plan to be
qualified and approved by the Internal Revenue Service under Section 401(a) of
the Code and for Company Matching Contributions to be deductible by the Company
for federal income tax purposes. Continuation of the Plan is contingent upon and
subject to retaining such
Page 51
qualification and approval. Any modification or amendment of the Plan or the
Trust Agreement may be made retroactively by the Company, if necessary or
appropriate, to qualify or maintain the Plan and the Trust as a plan and trust
meeting the requirements of applicable sections of the Code and of other federal
and state laws, as are now, or in the future may be, in effect. No contribution
made by the Company may revert to the Company, unless such contribution was the
result of a good faith mistake of fact, in which case such contribution may be
returned to the Company within one (1) year to the extent permitted by all
applicable laws.
14.050 INTERPRETATION. The masculine gender will include the feminine and the
singular will include the plural unless the context clearly indicates otherwise.
14.060 MILITARY SERVICE. Notwithstanding any provision of the Plan to the
contrary, contributions, benefits and service credit with respect to qualified
military service will be provided in accordance with Section 414(u) of the Code.
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IN WITNESS WHEREOF, this amended and restated plan document is
executed effective as of August 1, 2005.
MINDSPEED TECHNOLOGIES, INC.
BY:
/s/ Bradley W. Yates
- -------------------------------------------------------
Bradley W. Yates,
Senior Vice President and Chief Administrative Officer
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APPENDIX A
PROCEDURES, TERMS AND CONDITIONS OF LOANS
ELIGIBILITY FOR LOANS. The individuals eligible to obtain loans from the Plan
("Borrowers") are limited to:
(1) Employees; and
(2) non-Employees who are "parties in interest" (as defined in Section
3(14) of ERISA),
who have Plan Account balances. An Employee who wishes to obtain a loan must be
employed on an active payroll of an Affiliated Company at the time of the loan
application. A party in interest who is not an Employee will be eligible to
obtain a loan only if an agreement can be provided by the party's current
employer to deduct and remit the required loan repayments to the Savings Plan.
LIMITATION ON NUMBER AND MINIMUM AMOUNT OF LOANS. Two (2) loans per Borrower
will be permitted to be outstanding from all Company-sponsored savings plans at
any one time. Each loan must be for a minimum of One Thousand Dollars ($1,000).
MAXIMUM AMOUNT OF LOAN. The amount which a Borrower will be permitted to borrow
from the Plan is based on the aggregate value of the Borrower's Accounts,
determined in accordance with the Plan, and may not exceed the least of the
amounts described in Section 6.050 of the Plan. The maximum amount of any loan
will be further limited to ensure that, after applying the appropriate interest
rate and taking into account all applicable deductions, the resulting periodic
repayments will not exceed the Borrower's net earnings. The deductions referred
to in the preceding sentence include statutory withholdings, deductions for
employee benefits and all pre-tax contributions to the Plan, but exclude credit
union, savings bond, charitable contributions and other similar deductions.
LOAN APPLICATIONS. Loan applications by prospective Borrowers will be made via
telephone to the Plan Administrator or such third party administrator as may be
designated by the Plan Administrator (either of whom is hereafter referred to as
the "Loan Administrator"). The Loan Administrator will then review the
telephonic application and determine eligibility for the loan. If the loan is
approved, the Loan Administrator will prepare and forward to the Borrower a
letter notifying the Borrower of the approval, together with a Truth in Lending
Statement and a check for the loan amount, all in form approved by the Plan
Administrator. The Borrower's endorsement of the loan check will be considered
to be the Borrower's agreement to the terms of the loan.
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Failure by the Borrower to endorse the check within thirty (30) days after the
date of the check will be deemed to be a withdrawal by the Borrower of the loan
application.
SOURCE OF LOAN FUNDS. Each loan will be funded by withdrawing the required
amounts from the Plan Account(s) of the Borrower in the following order:
First -- from amounts in the Borrower's Post-Tax Contribution Account
attributable to his or her Basic Post-Tax Contributions;
Second -- from amounts in the Borrower's Post-Tax Contribution Account
attributable to his or her Supplemental Post-Tax
Contributions;
Third -- from amounts in the Borrower's Contribution Accounts
attributable to his or her Rollover andTransfer Contributions;
Fourth -- from amounts in the Borrower's Pre-Tax Contribution Account
attributable to his or her Basic Pre-Tax Contributions;
Fifth -- from amounts in the Borrower's Pre-Tax Contribution Account
attributable to his or her Supplemental Pre-Tax Contributions
and attributable to his or her Catch-Up Pre-Tax Contributions.
Subject to the provisions of the following paragraph, the loan amount will be
funded by the Borrower's Investment Funds in the applicable Accounts on a pro
rata basis, based upon the relative size of the balance of each such Fund in his
or her Accounts.
DETERMINATION OF LOAN INTEREST RATE. The interest rate to be charged for loans
will be one percent (1%) over the prime rate stated by The Wall Street Journal
published on the last business day of each calendar quarter.
TERM OF LOANS. Loans will be permitted for terms of 12, 24, 36, 48 or 60 months
for loans other than those for the purpose of purchasing a primary residence,
which will be permitted for terms up to 120 months.
REPAYMENTS. Loan repayments by Employees will be deducted from the Employee's
pay check each pay period. If a pay check is insufficient to cover the full
amount of the loan repayment, no deduction will be made, and the repayment will
be deducted from the Employee's next pay check. Loan repayment schedules for
Borrowers who are not Employees will be developed on an individual basis, but
will parallel as closely as possible the loan repayment schedules for Employees.
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PREPAYMENTS. The full unpaid balance of a loan may be prepaid at any time by a
Borrower. Partial prepayments in excess of scheduled payroll deductions will not
be accepted.
MISSED PAYMENTS. If any payment is not made, interest will continue to accrue on
such missed payment and subsequent payments will be applied first to accrued and
unpaid interest on the missed payment and then to principal. A notice will be
mailed to the last known address of the Borrower stating that if three (3)
consecutive months of payments are missed, the loan will be considered to be in
default.
TERMINATION OF EMPLOYMENT. If a Borrower who is an Employee terminates
employment or is on an unpaid leave of absence, or if a Borrower who is not an
Employee is no longer able to repay a loan through payroll deductions, the
Borrower may continue to make loan repayments, subject to restrictions imposed
by the Company on payment methods. Such repayments to the Plan will be made
through the Loan Administrator at an address to be provided to the Borrower by
the Loan Administrator.
DEFAULT. A loan will be considered to be in default after three (3) consecutive
months of payments have been missed during the term of the loan or when a
Borrower revokes a payroll deduction authorization. In the event of such a
default, a distribution of the loan amount, including both unpaid principal and
accrued but unpaid interest, will be deemed to have occurred (as described in
Section 1.401(k)-1(d)(6)(ii) of the Department of the Treasury regulations) and
an information return reflecting the tax consequences, if any, to the Borrower
will be issued. Upon the occurrence of an event permitting actual distribution
of the Borrower's Account pursuant to the provisions of Code Section 401(k)
(whether distribution of the Borrower's entire Plan Account will actually be
made or will be deferred pursuant to applicable provisions of the Plan), the
unpaid balance of a defaulted loan will be charged off against the Borrower's
Account. If no distribution event has occurred which would otherwise permit
payment to the Borrower under Code Section 401(k), the unpaid balance of the
loan will be retained in the Account until such time as payment would be
permitted under that Code section, at which time the unpaid balance of the loan,
including any accrued and unpaid interest, will be charged off against the
Borrower's Account.
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APPENDIX B
INVESTMENT FUNDS
The Investment Funds listed alphabetically below will consist of the types of
assets as are set forth in the description set forth herein and will be more
fully described in the prospectus or Fund description associated with that Fund
(copies of which will at all times be available to Plan Participants):
- - ARIEL FUND Normally invests in equity securities of
(Ariel Fund) widely-ignored, misunderstood or under-
followed companies with market
capitalizations under $2.5 billion.
- - ASSET ALLOCATION FUND A 20% in Fidelity stock mutual funds, 40%
(Fidelity Freedom Income Fund) in Fidelity bond mutual funds and 40% in
Fidelity money market mutual funds
(percentages are approximate).
- - ASSET ALLOCATION FUND B 39% in Fidelity stock mutual funds, 39%
(Fidelity Freedom 2000 Fund) in Fidelity bond mutual funds and 22% in
Fidelity money market mutual funds
(percentages are approximate).
Percentage mix will gradually become
more conservative over time.
- - ASSET ALLOCATION FUND B-1 45% in Fidelity stock mutual funds, 45%
(Fidelity Freedom 2005 Fund) in Fidelity bond mutual funds and 10% in
Fidelity money market mutual funds
(percentages are approximate).
Percentage mix will gradually become
more conservative over time.
- - ASSET ALLOCATION FUND C 45% in Fidelity stock mutual funds, 45%
(Fidelity Freedom 2010 Fund) in Fidelity bond mutual funds and 10% in
Fidelity money market mutual funds
(percentages are approximate).
Percentage mix will gradually become
more conservative over time.
B-1
- - ASSET ALLOCATION FUND C-1 55% in Fidelity stock mutual funds, 39%
(Fidelity Freedom 2015 Fund) in Fidelity bond mutual funds and 6% in
Fidelity money market mutual funds
(percentages are approximate).
Percentage mix will gradually become
more conservative over time.
- - ASSET ALLOCATION FUND D 69% in Fidelity stock mutual funds and
(Fidelity Freedom 2020 Fund) 31% in Fidelity bond mutual funds
(percentages are approximate).
Percentage mix will gradually become
more conservative over time.
- - ASSET ALLOCATION FUND D-1 75% in Fidelity stock mutual funds and
(Fidelity Freedom 2025 Fund) 25% in Fidelity bond mutual funds
(percentages are approximate).
Percentage mix will gradually become
more conservative over time.
- - ASSET ALLOCATION FUND E 82% in Fidelity stock mutual funds and
(Fidelity Freedom 2030 Fund) 18% in Fidelity bond mutual funds
(percentages are approximate).
Percentage mix will gradually become
more conservative over time.
- - ASSET ALLOCATION FUND E-1 84% in Fidelity stock mutual funds and
(Fidelity Freedom 2035 Fund) 16% in Fidelity bond mutual funds
(percentages are approximate).
Percentage mix will gradually become
more conservative over time.
- - ASSET ALLOCATION FUND F 87% in Fidelity stock mutual funds and
(Fidelity Freedom 2040 Fund) 13% in Fidelity bond mutual
funds (percentages are approximate).
Percentage mix will gradually become
more conservative over time.
B-2
- - BARON GROWTH FUND Normally invests in small cap companies
(Baron Growth Fund) with market values under $1.5 billion.
The Fund's size gives it the opportunity
to invest in smaller companies that may
have a significant impact on the Fund's
performance.
- - BOND INDEX FUND 80% of total assets in bonds included
(Fidelity U.S. Bond Index Fund) in the Lehman Brothers Aggregate Bond
Index.
- - DIVIDEND GROWTH FUND 80% of total assets in companies that
(Fidelity Dividend Growth Fund) Fidelity Management & Research Company
believes have the potential for
dividend growth by either increasing
dividends or by commencing dividends, if
none are current paid.
- - EQUITY INDEX FUND 80% of assets in common stocks included
(Spartan(C) U.S. Equity Index Fund) in the S&P 500, which broadly represents
the performance of common stocks
publicly traded in the U.S.
- - GOVERNMENTAL INCOME FUND Normally invests at least 80% of total
(Fidelity Intermediate Governmental assets in U.S government securities
Income Fund) and repurchase agreements for those
securities, maintaining a dollar-
weighted average maturity of three to
ten years. The fund is managed to have
similar overall interest rate risk to
the Lehman Brothers Intermediate
Government Bond Index.
- - GROWTH COMPANY FUND Normally invests in common stocks of
(Fidelity Growth Company Fund) domestic and foreign issuers with
potential for above-average growth.
- - GROWTH FUND Normally invests in common stock. May
(Fidelity Fund) invest in bonds including lower quality
debt securities.
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- - INTERNATIONAL FUND Normally invests in stocks of larger
(Fidelity Diversified International companies which are located outside the
Fund) United States and which are viewed as
being undervalued.
- - LOW-PRICED STOCK FUND 80% of its total assets in low-priced
(Fidelity Low-Priced Stock Fund) stocks (those priced at or below $35 per
share), which can lead to investments in
small and medium-sized companies.
Potentially investing in stocks not
considered low-priced. Investing in
domestic and foreign issuers. Investing
in either 'growth' or 'value' stocks or
both.
- - MID-CAP STOCK FUND 80% of total assets in common stock of
(Fidelity Mid-Cap Stock Fund) companies with medium market
capitalizations (those with market caps
similar to companies in the S&P MidCap
400 Index).
- - MINDSPEED STOCK FUND Mindspeed Technologies, Inc. common
(Employee Stock Fund) stock, cash and the proceeds and income
on such cash and common stock.
Initially, Company Matching
Contributions and Company Profit Sharing
Contributions will be invested in the
Mindspeed Stock Fund.
- - THE OAKMARK SELECT FUND - CLASS I Normally seeks capital appreciation by
(The Oakmark Select Fund - Class I) investing in a concentrated portfolio
(typically 15 to 20 companies). The Fund
generally invests in mid- and large-cap
companies based in the U.S. The Fund
is non-diversified, so it may
concentrate its assets in fewer
individual securities than a diversified
fund. Therefore Fund's share price may
fluctuate more than that of a comparable
diversified fund.
- - OTC PORTFOLIO FUND Normally invests at least 80% of total
(Fidelity OTC Portfolio Fund) assets in securities traded on Nasdaq or
another over-the-counter (OTC) market,
which has
B-4
more small- and medium-size companies
than other markets.
- - T. ROWE PRICE EMERGING MARKETS Normally invests in securities of
STOCK FUND - CLASS A companies located in emerging markets.
(T. Rowe Price Emerging Markets The Fund seeks long-term capital growth.
Stock Fund - Class A)
- - VAN KAMPEN GROWTH AND INCOME Normally invests in income-producing
FUND - CLASS A equities and may also purchase
(Van Kampen Growth and Income investment- grade debt.
Fund - Class A)
- - MANAGED INCOME PORTFOLIO Normally invests in investment contracts
(a stable value fund - not a providing a stated rate of interest
mutual fund) which are offered by major insurance
companies, with some investment in
certain types of fixed income securities
to provide daily liquidity.
In the event a Participant fails to make an investment election for Participant
Contributions, the Participant's Account will be invested in the Managed Income
Portfolio. The Company Matching Contributions and Company Profit Sharing
Contributions that are contributed by the Company in the form of cash, Mindspeed
common stock, or any combination thereof, will remain in the Mindspeed Stock
Fund until such Company Matching Contributions or Company Profit Sharing
Contributions are transferred.
B-5