UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-K/AAmendment No. 2ANNUAL REPORT

(Mark One)ý

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended September 30, 2008ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period
from                                to


Commission file number 0-19654

VITESSE SEMICONDUCTOR CORPORATION(Exact name of registrant as specified in its charter)

Delaware

77-0138960(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)741 Calle Plano
Camarillo, California

93012(Address of principal executive offices)

(Zip Code)


Registrant's
telephone number, including area code:(805) 388-3700

Securities
registered pursuant to Section 12(b) of the Act: NONE

Securities
registered pursuant to Section 12(g) of the Act: Common Stock, Par Value $0.01

Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. YES o    NO ý

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act. YES o    NO ý

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days. YES ý    NO o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this
chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of
"accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o

Accelerated filer ý

Non-accelerated filer o (Do not check if a smaller reporting company)

Smaller reporting company o


Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). YES o    NO ý

As of March 31, 2008, the aggregate market value of the voting and non-voting common equity held by non-affiliates was $110,615,635,
based on the closing price on that date. As of January 26, 2009 there were 230,905,580 shares of the registrant's $0.01 par value common stock outstanding.



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EXPLANATORY NOTE

The purpose of this Amendment No. 2 on Form 10-K/A (this "Amendment") of Vitesse Semiconductor Corporation
("we," "our," "us," or the "Company") is to amend and restate Part III, Items 10 through 14 of the previously filed Annual Report on Form 10-K for the year ended
September 30, 2008, filed with the Securities and Exchange Commission on December 31, 2008 (the "Original Form 10-K"), to include information previously omitted in
reliance on General Instruction G to Form 10-K, which provides that registrants may incorporate by reference certain information from a definitive proxy statement prepared in
connection with the election of directors. The Company has determined to include such Part III information by amendment of the Original Form 10-K rather than by incorporation
by reference to the proxy statement. Accordingly, Part III and Part IV of the Original Form 10-K is hereby amended and restated as set forth below.

Except
as described above, no other changes have been made to the Original Filing. The Original Filing continues to speak as of the date of the Original Filing, and we have not updated
the disclosures contained therein to reflect any events which occurred at a date subsequent to the filing of the Original Filing. Accordingly, this Amendment should be read in conjunction with our
filings with the Securities and Exchange Commission subsequent to the filing of the Original Filing.

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PART III

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Directors

The authorized number of directors under our bylaws is a minimum of five and a maximum of nine. The Board of Directors has set the
number of directors at seven. Currently, the Board of Directors is comprised of seven members: Guy W. Adams, Vincent Chan, Ph.D, Christopher R. Gardner, Steven P. Hanson, Robert A. Lundy, Edward
Rogas, Jr., and Willow B. Shire. There are no family relationships among any of our directors or executive officers. Additional information regarding each of our directors is set forth below.

Guy W. Adams,age 57, has been a director since October 25, 2007. Mr. Adams is the managing member of GWA Investments, LLC and
GWA Capital Partners, LLC, where he has served since 2002. GWA Investments is an investment fund investing in publicly-traded securities managed by GWA Capital Partners, LLC, a
registered investment advisor. Prior to 2002, Mr. Adams was the President of GWA Capital, which he founded in 1996 to invest his own capital in public and private equity transactions.
Mr. Adams is currently a member of the Board of Trustees of Mercer International Inc., where he has served since August 2003. Mr. Adams earned an MBA from Harvard Business School
and a BS in Petroleum Engineering from Louisiana State University. Mr. Adams was previously an independent director of Exar Corporation (resigned August 2007) and Lone Star Steakhouse (resigned
May 2002).

Vincent Chan, Ph.D, age 59, has been a director since April 18, 2000. Dr. Chan is serving on the Massachusetts Institute of
Technology's faculty as the Joan and Irwin Jacobs Professor of Electrical Engineering and Computer Science and as a member of the Claude E. Shannon Communication and Network Group, Research Laboratory
of Electronics. From 1995 to 1998, he was the Head of the Communications and Information Technology Division of MIT Lincoln Laboratory. He is a member of The Corporation of The Charles Stark Draper
Laboratory, Inc. and a Fellow of IEEE and the Optical Society of America. Dr. Chan has over 35 years experience leading the development of advanced communication systems and
networks. Dr. Chan is a Member of the Corporation of Draper Laboratory, a private company, since 2000.

Christopher R. Gardner, age 48, has been a director since October 26, 2006. Mr. Gardner has been our Chief Executive Officer
since May 15, 2006, and was Acting Chief Executive Officer from April 18, 2006 to May 15, 2006. Mr. Gardner joined our company in 1986. He served as Vice President and
Chief Operating Officer from November 2000 to June 2002. From June 2002 until he was appointed Acting Chief Executive Officer on April 18, 2006, he served as Vice President and General Manager
of the Network Products Division. Mr. Gardner also served as a member of the Technical Staff at Bell Laboratories from 1982 to 1986. Mr. Gardner received his BSEE from Cornell University
and his MSEE from the University of California at Berkeley.

Steven P. Hanson, age 60, has been a director since August 16, 2007. Mr. Hanson has been a senior partner at Southwest Value
Acquisitions, a private equity firm, since 2004. He also serves as the Chairman of InPlay Technologies Inc., a high-technology firm delivering leadership human input device
technologies and products. From 1999 to 2003, Mr. Hanson was President and Chief Executive Officer of ON Semiconductor. He has served for more than 32 years in senior executive roles at
technology companies, including 28 years at Motorola in various engineering management and leadership positions. Mr. Hanson has served Arizona State University as a member of the Dean's
Advisory Council, W.P. Carey School of Business and the Dean's Advisory Council for the Ira A. Fulton School of Engineering. Mr. Hanson holds a BSEE from the College of Engineering at Arizona
State University.

Robert A. Lundy, age 60, has been a director since May 2, 2008. Mr. Lundy currently serves as President and CEO of
Glimmerglass, a high-technology company that develops and markets Intelligent

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Optical
Systems for the telecommunications industry, data centers, and defense. Mr. Lundy has been a member of the Board of Glimmerglass since 2002. Mr. Lundy has been a founder and CEO
of several early stage ventures, including Wavetrace, Xtera, and Opthos. From 1985 to 1994, he held executive positions at ROLM, IBM, and HP. Mr. Lundy holds a BS from the U.S. Military Academy
at West Point, a MSEE from Stanford University and an MBA from the Stanford Graduate School of Business. He is also a graduate of the U.S. Army Command and General Staff College.

Edward Rogas, Jr., age 68, has been a director since January 24, 2006 and the Chairman of the Board of Directors since December
2006. Mr. Rogas currently is retired and served as a Senior Vice President at Teradyne, Inc., an automated test equipment manufacturer, from 2000 to December 31, 2005. From 1976
to 2000, he held various management positions in the semiconductor ATE portion of Teradyne's business, including Vice President from 1984 to 2000. Prior to that, from 1973 to 1976, he served as a Vice
President at American Research and Development. Mr. Rogas is currently on the Board of Vignani Technologies Pvt Ltd. (a private Indian company). Mr. Rogas holds an MBA (with
distinction) from Harvard Business School and a BS from the United States Naval Academy.

Willow B. Shire, age 60, has been a director since June 26, 2007. Ms. Shire has been an executive consultant with Orchard
Consulting Group since 1994, specializing in leadership development and strategic problem-solving. Previously, she was Chairperson for the Computer Systems Public Policy Project within the National
Academy of Science. She also held various positions at Digital Equipment Corporation, a computer hardware manufacturer, for 18 years, including Vice President and Officer, Health Industries
Business Unit. Ms. Shire is currently on the Board of The TJX Companies, Inc. (a NYSE listed-company). Ms. Shire holds a BS from Boston University's School of Education and a MAT
from Harvard University School of Education.

All
of our directors, with the exception of Mr. Gardner who is our President and CEO, meet the NASDAQ Marketplace Rules criteria for independence.

Executive Officers

Set forth below is information regarding our executive officers, other than Christopher R. Gardner, our President and Chief Executive
Officer, which information is set forth above under "Directors."

Richard C. Yonker, age 61, was appointed our Chief Financial Officer on December 14, 2006. Mr. Yonker was the Chief
Financial Officer of Capella Photonics, a telecommunications company, from October 2005 to November 2006. He also served as Chief Financial Officer of Avanex Corporation, an optical telecommunications
company, from April 2005 to September 2005, Actelis Networks, a telecommunications company, from May 2004 to April 2005, Bermai, a WiFi semiconductor company, from November 2003 to April 2004, Gluon
Networks, a telecommunications switch company, from February 2003 to October 2003 and Agility Communications, a telecommunications company, from November 2000 to January 2003. He currently is a
director of Logic Vision, a semiconductor company providing built-in-self-test and diagnostic solutions. Mr. Yonker holds a BS in industrial engineering from
the General Motors Institute and an MS in finance management from the Massachusetts Institute of Technology.

Michael B. Green, age 63, was appointed our Vice President, General Counsel and Secretary on January 25, 2007. Mr. Green was
an independent consultant in 2006 and from 1999 through 2005 was the Vice President, General Counsel and Secretary of Worldwide Restaurant Concepts, Inc., an international restaurant company.
Prior to that, he was a counsel and senior attorney for Atlantic Richfield Company and Montgomery Ward & Co., Inc., respectively. Mr. Green has also worked in private
practice and as a trial attorney for the Antitrust Division of the United States Department of Justice in Washington D.C. Mr. Green holds a BS from Brooklyn College of the City University of
New York and a JD from New York University School of Law.

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Dr. Martin Nuss, age 51, was appointed our Vice President of Technology and Strategy on November 16, 2007. Dr. Nuss
was most recently Chief Technology Officer of Ciena's Optical Ethernet group. Prior to Ciena's acquisition of the company, he was founder and Chief Technology Officer of Internet Photonics. He also
served 15 years at Bell Labs in various technical and management roles including Director of the Optical Data Networks Research Department. He is a Fellow of the Optical Society of America and
a member of IEEE. Dr. Nuss holds a doctorate in applied physics from the Technical University in Munich, Germany.

Section 16(a) Beneficial Ownership Reporting Requirements

Section 16(a) of the Exchange Act requires our executive officers, directors, and persons who own beneficially more than 10% of
a registered class of our equity securities to file reports of ownership and changes in ownership within specified periods with the SEC. To our knowledge, based solely on our review of the copies of
Section 16(a) forms required to be furnished to us with respect to fiscal year 2008 and any written representations that no other reports were required,
the Section 16(a) reporting requirements for reports required to be filed during fiscal year 2008 were met.

Codes of Business Conduct and Ethics

We have adopted a Code of Business Conduct and Ethics for members of the Board of Directors, a Code of Business Conduct and Ethics for
all officers and employees of the Company and its consolidated subsidiaries, and a Code of Ethics for the Chief Executive Officer and Senior Financial Officers that applies to our Chief Executive
Officer, Chief Financial Officer, Chief Accounting Officer/Controller and persons performing similar functions. Copies of these Codes are posted on our website, http://www.vitesse.com, under
"InvestorsCorporate Governance." We intend to disclose any amendment to, or waiver from, the provisions of
these Codes on our website under "InvestorsCorporate Governance."

Procedure for Nominating Directors

Our Board of Directors launched a process to reconstitute its membership. As part of this process, our Board initiated searches for
new, highly-qualified directors who are independent of management. To date, this process has resulted in the appointments of Guy W. Adams, Steven P. Hanson, Robert A. Lundy, and Willow B. Shire as
directors.

As
part of this process, the Nominating and Corporate Governance Committee continues to solicit recommendations from shareholders to identify highly-qualified, independent candidates for
new directors. The Committee has engaged the recruiting firm of Russell Reynolds Associates to assist with the process of identifying and selecting candidates.

In
connection with the settlement of the outstanding derivative actions against us as described under "Legal Proceedings," we have agreed to establish a procedure, in consultation with
The Corporate Library, corporate governance experts selected by the lead counsel in the derivative action, to identify and nominate a person to become a director. That procedure provides that each
individual or entity known to us or The Corporate Library to have continuously held at least 1% of our common stock for at least one year will be contacted for the purpose of requesting that such
shareholder provide the name or names of candidates for our Board. An appropriate review of any candidates submitted will be conducted jointly by the Nominating and Corporate Governance Committee and
The Corporate Library. If a qualified candidate is identified, he or she will be recommended to the Board for appointment or for nomination for election by the shareholders.

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Audit Committee

Our Board of Directors has an Audit Committee, the members of which are Chairman Edward Rogas, Jr., Guy W. Adams and Steven P. Hanson.
All of the members of the Audit Committee meet the independence, financial literacy, and other applicable requirements of the Exchange Act, the rules and regulations of the SEC and the requirements of
the NASDAQ Marketplace Rules. Mr. Hanson has been designated our "audit committee financial expert," as defined in Item 407 of Regulation S-K promulgated by the SEC.

The
Audit Committee assists our Board of Directors in its oversight of the integrity of our financial statements, the qualifications and independence of our independent audits, the
performance of our internal audit function, compliance with legal and regulatory requirements, our disclosure controls, and system of internal controls.

ITEM 11.    EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Overview

The Compensation Committee determines the overall executive compensation practices for our named executive officers. Executive
compensation for our named executive officers consists of three components:



Compensation Philosophy and Objectives

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

Compensation Practices

Each year, the Compensation Committee determines the amounts of each named executive officer's base salary, annual cash bonus, and
stock option grants. The Compensation Committee reviews industry data to gain an understanding of compensation levels within the industry for each named executive officer.

The
Compensation Committee previously reviewed the Radford Executive Survey to obtain industry data. Starting in fiscal year 2008, the Compensation Committee commenced reviewing
additional industry surveys and consulting with other independent compensation consultants to assess its competitors' executive compensation levels for base salary, annual cash bonus, and to a limited
extent, stock option grants.

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The
Compensation Committee considers industry compensation data because it wishes to provide compensation packages that are neither at the low or high ends of the range of comparable
companies but, instead, are targeted toward the mid-point of the range of comparable companies. However, the Compensation Committee's determinations regarding individual compensation
elements are based on several factors beyond industry data, including, but not limited to, the criticality of the position, individual performance and company performance. After reviewing industry
data and assessing the role and performance of each named executive officer, the Compensation Committee uses its discretion to set compensation levels for each of the three components for the named
executive officers.

Consideration of Competitors' Compensation

Historically, the Compensation Committee selected the Radford Executive Survey as the source for its peer group compensation data
because it is a reliable and neutral vendor of pay data regarding semiconductor companies, including the majority of our competitors. In 2008, the Radford Executive Survey contained data from the
following 26 semiconductor companies, which were selected because their annual revenues were within the same range as ours ($100.0 million to $499.9 million):

Actel

Omnivision TechnologiesAMCC

PMC-SierraAnadigics

RambusAsyst Technologies

SemtechAtheros Communications

SigmatelCirrus Logic

Silicon ImageCREE

Silicon LaboratoriesEmulex

Silicon Storage TechnologiesGenesis Microchip

SIRF TechnologyLattice Semiconductor

SMSCMicrel Semiconductor

Triquint SemiconductorMicrosemi

Ultraclean TechnologyMindspeed Technologies

Zoran


In
fiscal year 2008, the Compensation Committee sought to re-evaluate the companies included in its peer group and decided to also evaluate other compensation consultants,
including DolmatConnell and F.W. Cook, who could provide additional services including a broader comparative group, an evaluation of long-term incentives, a review of internal pay equity,
and various structures for aligning compensation with company performance.

The Role of Management in Setting Executive Compensation

Compensation for our named executive officers, other than our CEO, Christopher R. Gardner, is established by the Compensation Committee
upon the recommendation of Mr. Gardner. With regard to our named executive officers other than the CEO, Mr. Gardner recommends individual goals and conducts formal performance
evaluations that he presents to the Compensation Committee in executive sessions. After consideration of Mr. Gardner's presentation, the ultimate decision as to compensation to be paid to those
named executive officers is made by the Compensation Committee.

The
Compensation Committee solely is responsible for setting compensation for the CEO, including establishing and conducting performance evaluations relating to individual goals.
Mr. Gardner does not participate in any Compensation Committee decisions regarding his own compensation.

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Fiscal Year 2008 Compensation Practices

In fiscal year 2008, the Compensation Committee implemented changes to the Company's executive compensation practices. The Compensation
Committee adopted the Fiscal Year 2008 Executive Bonus Plan to provide an opportunity for eligible participants, including the named executive officers, to earn cash incentive bonuses based upon the
Company's attainment of specified financial performance objectives and the executive's achievement of designated personal goals that are aligned with corporate performance. This change was implemented
to encourage individual and team performance.

Under
the Executive Bonus Plan, eligible participants were able to earn a maximum bonus of 60% of base salary, subject to at least partial attainment of the Company's financial
performance objectives and personal goals and objectives for each participant as set by the CEO. This means that even if all personal goals were 100% satisfied, the executive would be unable to earn
any bonus if the Company did not at least substantially meet or exceed the established financial performance objectives. The Company's financial performance objectives were set by the Compensation
Committee in consultation with management and were linked to earnings before interest, taxes, depreciation and amortization. The designated personal goals for the named executive officers, other than
the CEO, were recommended by the CEO and approved by the Compensation Committee.

Bonus
payments, if any, are to be made in two equal installments on or before the end of the second fiscal quarter of 2009 and on or after the end of the fourth fiscal quarter of 2009.
All bonus payments to the named executive officers under the Plan, other than the CEO, are to be made upon the recommendation of the CEO, with approval by the Compensation Committee.

The
bonus paid to the CEO for fiscal year 2008 was made at the discretion of the Compensation Committee after reviewing Mr. Gardner's attainment of his personal goals and
objectives, assessing the Company's financial performance and considering the progress made during the year to resolve accounting problems relating to historical option grant practices, satisfying
SEC-reporting obligations, and regaining eligibility to relist on the NASDAQ National Market.

At
the end of fiscal year 2008, formal performance evaluations were prepared by the CEO for the other named executive officers and by the Compensation Committee for the CEO, based on
goal achievement and feedback from subordinates, peers, and managers through the Company's annual 360 degree assessment.

For
fiscal year 2008, the Compensation Committee determined:



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Other Compensation

The named executive officers enjoy the same benefits as all other employees of the Company, including medical, dental, vision,
accidental death and dismemberment, group term life insurance in the amount of two times annual compensation (up to $280,000), business travel insurance, and a 401(k) plan in which the Company matches
$0.50 for each dollar of an employee's contribution up to 6% of the employee's base salary. Paid leave benefits include vacation, sick leave, holidays and a sabbatical after 10 years of
employment. The Company offers education assistance and a health/fitness benefit of $100 per year for health club membership or health/fitness classes. The Company also offers monetary rewards for
patent ideas, application notes for Company products, and published engineering articles and technical papers.

Fiscal Year 2009 Compensation Actions

On January 26, 2009, the Company reduced the base salaries of its named executive officers, effective February 1, 2009,
as follows: (i) Mr. Gardner20% reduction; (ii) Mr. Yonker10% reduction; (iii) Mr. Green10% reduction; and
(iv) Mr. Nuss10% reduction. Also effective February 1, 2009, the Company suspended all matching contributions for its named executive officers in connection with the
Company's 401(k) plan. These actions shall remain effective through the end of the Company's 2009 fiscal year.

Summary Compensation Table

The following table sets forth the compensation earned by our executive officers for services rendered in all capacities during the
fiscal years ended September 30, 2008, 2007 and 2006:

Name and
Principal Position

Year(1)

Salary

Bonus

Option
Awards(2)

Non-Equity
Incentive Plan

Total(3)Christopher R. Gardner


2008

$
350,000

$
$262,500

$
316,679




$
929,179Chief Executive Officer(5)


2007


328,462


175,000


320,540





824,0022006


253,019





301,323





554,342Richard C. Yonker


2008


275,000





41,098


74,250
(4)

390,348Chief Financial Officer(6)


2007


223,438


25,000


30,939


80,000


359,377Michael B. Green


2008


205,000








53,300
(4)

258,300Vice President, General Counsel and Secretary(7)


2007


153,750


20,000





41,000


214,750Martin C. Nuss


2008


193,991





23,672


66,000
(4)

283,663Vice President, Technology and Strategy(8)


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Mr. Gardner's compensation was established by his employment agreement, initially dated June 26, 2006. Under that
agreement, Mr. Gardner had a base salary of $310,000 per year and was entitled to participate in the employee benefit plans offered to senior executives from
time-to-time. The term of the agreement was two years. If Mr. Gardner's employment was terminated for Good Reason (as defined below) or other than For Cause (as defined
below), Death, Disability (as defined below), Mr. Gardner would be entitled to twelve months of his base salary as severance and he would be engaged as a consultant to the Company at $3,000 per
month until the earlier of (i) three years after the termination of his employment and (ii) the date the Company has an effective registration statement under the Securities Act with
respect to the shares to be issued upon exercise of options granted to him.

On
July 27, 2007, the employment agreement with Mr. Gardner was amended. Under the amended agreement, his base salary was increased to $350,000 per year, effective
April 1, 2007, which remained in effect through the fiscal year ended September 30, 2008. Further, if Mr. Gardner's employment is terminated for Good Reason, or other than For
Cause, death, or Disability, Mr. Gardner would be entitled to receive two years of his base salary plus two times the average of the maximum target bonus for the two most recent fiscal years
prior to his termination, and he would be engaged as a consultant until the earlier of: (i) three years after the termination of his employment and (ii) one year after the date the
Company has an effective registration statement under the Securities Act with respect to the shares to be issued upon exercise of options granted to him. In addition, Mr. Gardner's stock
options outstanding on the date of his termination would continue to vest normally during his service as a consultant and those options would be exercisable until the earlier of:
(i) 90 days following his termination as a consultant and (ii) the normal expiration dates of those options.

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



"Disability"
is defined as a physical or mental impairment of the executive as certified in a written statement from a licensed physician selected or approved by our Board of Directors
that renders the executive unable to perform his duties under his employment agreement (after reasonable accommodation, if necessary, by the Company that does not impose an undue hardship on the
Company) for 150 consecutive days or for at least 210 days (regardless of whether such days are consecutive) during any period of 365 days.

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"Good Reason" is defined as the occurrence, without the executive's written consent, of any of the following actions unless the action is fully corrected (if possible) within
15 days after the Company receives written notice of the action from the executive: (i) a reduction in the executive's base salary; (ii) the Company's failure to pay the executive
any amount that is expressly required to be paid under his employment agreement; (iii) the Company's material and adverse reduction of the nature of the executive's duties and responsibilities,
disregarding mere changes in title; (iv) the Company's requirement that the executive perform his principal employment duties at an office that is more than 20 miles from Camarillo, California;
or (v) a Change of Control of the Company. For this purpose, "Change of Control" means each occurrence of any of the following:



Mr. Gardner
also received a stock option grant of 400,000 shares upon his appointment as Acting CEO and prior to his Employment Agreement.



Mr. Yonker's compensation was established by his employment agreement, dated November 16, 2006, and was amended on
June 26, 2007. Under his agreement, Mr. Yonker received a base salary of $275,000, which remained in effect through the fiscal year ended September 30, 2008.

If
Mr. Yonker's employment is terminated for Good Reason (defined in a manner substantially the same as in Mr. Gardner's employment agreement) or other than For Cause
(defined in a manner substantially the same as in Mr. Gardner's employment agreement), Death, or Disability (defined in a manner substantially the same as in Mr. Gardner's employment
agreement), he will receive severance pay equal to 12 months of his then base salary. In the event of a Change of Control (defined in a manner substantially the same as in Mr. Gardner's
employment agreement) of the Company (or its successor) and any involuntary termination other than For Cause or Constructive Termination of Mr. Yonker's employment within one year of such a
Change of Control, then the shares underlying all of Mr. Yonker's outstanding options would be accelerated and immediately become vested as though all options were vesting over four years in 48
equal monthly amounts, and as though Mr. Yonker had completed an additional two years of service with the Company, and those options would be exercisable for an additional 90 days.



Mr. Green received an employment letter, dated January 2, 2007, from the Company pursuant to which the Company agreed,
among other things, that Mr. Green will receive an annual base salary of $205,000, which remained in effect through the fiscal year ended September 30, 2008. Upon a Change

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of
Control (defined in a manner substantially the same as in Mr. Gardner's employment agreement), severance in the amount equal to six months salary is payable in one lump sum on the date of
his termination. If Mr. Green voluntarily terminates his employment prior to completing two full years of service ending on January 4, 2009, he will reimburse the Company for the signing
bonus. The Company also agreed to recommend to the Board of Directors that Mr. Green receive an option to acquire 50,000 shares of the Company's common stock at the time it begins offering
options to its employees generally. On October 13, 2008, the Company granted 80,000 options to Mr. Green.



On November 16, 2007, the Board of Directors appointed Dr. Martin Nuss as Vice President Technology and Strategy.
Dr. Nuss received an employment letter from the Company pursuant to which the Company agreed that he is entitled to receive $220,000 as an annual base salary and is eligible to participate in
the Executive Bonus Plan, under which the Company has guaranteed a bonus to Dr. Nuss for fiscal year 2008 equal to at least 30% of his annual base salary. Dr. Nuss is also entitled to
employee benefits provided to other senior executives. In the event that his employment is terminated within nine months after a Change-in-Control (defined in a manner
substantially the same as in Mr. Gardner's employment agreement) or during that time period there is a material change in his position, responsibilities, or compensation, Dr. Nuss will
be entitled to a lump sum payment equal to 12 months of his then base salary. Dr. Nuss was also granted an option to purchase 200,000 shares of the Company's common stock at an exercise
price of $0.99 per share.

Grants of Plan-Based Awards

The following table sets forth information relating to plan-based awards granted to our named executive officers in fiscal
years 2008, 2007 and 2006:

Name

Grant
Date

All Other
Option Awards:
Number of
Securities
Underlying
Options

Exercise Price
of Options
(Per Share)

Grant Date Fair
Value of Stock
and Option
Awards(1)Christopher R. Gardner


6/21/2006


400,000

$
1.53

$
424,82112/2/2005


110,000


2.40


214,672Richard C. Yonker


1/25/2007


300,000


0.86


160,834Martin Nuss


11/16/2007


200,000


0.99


112,000


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Outstanding Equity Awards at Fiscal Year-End

The following table provides information regarding the holdings of stock options by our named executive officers at
September 30, 2008:

Name

Number of
Securities
Underlying
Unexercised
Options
Exercisable

Number of
Securities
Underlying
Unexercised
Options
Unexercisable

Option
Exercise
Price

Option
Expiration
DateChristopher R. Gardner


80,000





9.03


10/5/2008120,000





35.91


10/19/2009200,000





17.44


4/6/2011442,885





7.27


10/2/2011225,000





0.83


10/17/2012100,000





6.97


10/20/2013187,500


112,500


2.58


10/27/201455,000


55,000


2.40


12/2/2015200,000


200,000


1.53


6/21/2016Richard C. Yonker


75,000


225,000


0.86


12/11/2016Martin Nuss





200,000


0.99


11/16/2017


On
December 29, 2006, Christopher R. Gardner, agreed to amend all of his respective existing unexercised stock option awards that vested after December 31, 2004, or will
vest after December 31, 2004, and that are subject to an exercise price that is less than the Fair Market Value of a share of the our common stock at the time of grant, to have an exercise
price equal to the Fair Market Value of a share of our common stock on the actual date of grant.

Stock Option Exercises

There were no stock options exercised by our named executive officers during fiscal year 2008.

Pension Benefits

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

Potential Payments Upon Termination or Change-in-Control

If Mr. Gardner's employment were to have been terminated on September 30, 2008, for Good Reason or for reasons other than
For Cause, Death or Disability, he would have received a lump sum severance payment of $1,050,000 and he would be engaged as a consultant at $3,000 per month until the earlier of: (i) three
years after the termination of his employment; and (ii) one year after the date we have an effective registration statement under the Securities Act with respect to the shares to be issued upon
exercise of options granted to him. In addition, Mr. Gardner's stock options outstanding on the date of his termination would continue to vest normally during his service as a consultant and
those options would be exercisable until the earlier of 90 days following his termination as a consultant and the normal expiration dates of those options.

If
Mr. Yonker's employment were to have been terminated on September 30, 2008, for Good Reason or for reasons other than For Cause, Death or Disability, he would have
received a lump sum payment of $275,000. In addition, the shares underlying all of Mr. Yonker's outstanding stock options would be accelerated and immediately become vested as though all
options were vesting over four years

13

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in
48 equal monthly amounts, and as though Mr. Yonker had completed an additional two years of service with the Company, and those options would be exercisable for an additional 90 days.

If
Mr. Green's employment were to have been terminated on September 30, 2008, as a result of a Change of Control, he would have received a lump sum payment of $102,500.

If
Dr. Nuss' employment were to have been terminated on September 30, 2008, as a result of a Change of Control or during that time period there was a material change in his
position, responsibilities, or compensation, he would have received a lump sum payment of $220,000.

Compensation of Directors

Effective July 27, 2007, after consultation with compensation consultants, the Board of Directors adopted the following
compensation package for directors:



Director Compensation Table for Fiscal 2008

The following table presents information regarding the compensation paid during fiscal year 2008 to members of our Board of Directors
who are not also our employees (referred to as "Non-Employee Directors"). The compensation paid to Mr. Gardner, who is also employed by us, is presented above on page 8 in
the Summary Compensation Table and the related explanatory tables. Directors who are also

14

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officers
or employees of the Company or its subsidiaries receive no additional compensation for their services as directors.

Name

Fees Earned in
Cash

Option
Awards(1)

TotalGuy W. Adams(2)

$
44,416

$
10,428

$
54,844Vincent Chan Ph.D(3)


40,000


52,324


92,324Alex Daly(4)





3,238


3,238Steven P. Hanson(5)


48,500


11,933


60,433Robert Lundy(6)


15,417


3,253


18,670Edward Rogas, Jr.(7)


74,500


18,243


92,743Willow B. Shire(8)


64,000


11,901


75,901


---

15

---



Compensation Committee Interlocks and Insider Participation

No director who served on the Compensation Committee of our Board during fiscal year 2008 currently is, or during fiscal 2008 was, an
officer or employee of the Company or had any relationship requiring disclosure by us under Item 404 of Regulation S-K. In addition, no member of our Compensation Committee
is, or during fiscal year 2008 was, employed by a company whose Board of Directors includes or included any members of our management.

Compensation Committee Report

The following Compensation Committee Report does not constitute soliciting materials and shall not be deemed
filed or incorporated by reference into any other filings by us under the Securities Act of 1933 or the Exchange Act, except to the extent we specifically incorporate this Compensation Committee
Report by reference therein.

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

We
have reviewed and discussed the Compensation Discussion and Analysis contained in this Report with management. Based on our review of and the discussions with management with respect
to the Compensation Discussion and Analysis, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Annual Report.

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



16

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ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Equity Compensation Plan Information

A

B

CPlan Category

Number of
Securities to be
Issued upon
Exercise of
Outstanding
Options

Weighted Average
Exercise Price of
Outstanding
Options

Number of
Securities
Remaining
Available for
Future Issuance
Under Equity
Compensation
Plans (Excluding
Securities Reflected
in Column A)Equity Compensation Plans approved by Shareholders(1)


15,462,647
(2)
$
7.22


63,086,051
(3)Equity Compensation Plans not approved by Shareholders(4)


2,752,614

$
6.52


504,344Total(5)


18,215,261

$
7.11


63,590,395


---

17

---





Security Ownership of Certain Beneficial Owners and Management

The following table sets forth certain information regarding the beneficial ownership of shares of our common stock as of
January 21, 2009 by: (i) each of our current directors; (ii) each of our executive officers named in the Summary Compensation Table; (iii) all of our current executive
officers and directors as a group; and (iv) all those known by us to be beneficial owners of more than five percent of the outstanding shares of our common stock. Five percent or greater
shareholder information is based on information contained in Schedule 13D/13G filings. Unless otherwise indicated, the address of each of the beneficial owners listed in this table is: c/o
Vitesse Semiconductor Corporation, 741 Calle Plano, Camarillo, California 93012.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Name of Individuals or Identity of Group

Shares
Beneficially
Owned

Shares
Exercisable
Within 60
Days of
January 21,
2009

Total Shares
Beneficailly
Owned Plus
Exercisable
Within 60
Days of
January 21,
2009

Percent of Total
Shares
OutstandingRonald Gutfleish, c/o Elm Ridge Capital Mgmt


17,086,571
(1)




17,086,571


7.4
%3 West Main Street, 3rd FloorIrvington, NY 10533Whitebox Advisors, LLC


14,100,551
(2)




14,100,551


6.1
%3033 Excelsior Boulevard, Suite 300Minneapolis, MN 55416Kopp Investment Advisors, LLC


14,092,050
(3)




14,092,050


6.1
%7701 France Avenue South, Suite 500Edina, MN 55435Steelhead Navigator Master, L.P.


12,614,800
(4)




12,614,800


5.5
%1301 First Avenue, Suite 201Seattle, WA 98101Christopher R. Gardner


393,734
(5)

1,632,885


2,026,619


*Guy W. Adams


300,000
(6)

25,500


325,500


*Vincent Chan, Ph. D


30,000


290,592


320,592


*Richard C. Yonker


100,000
(7)

150,000


250,000


*Edward Rogas, Jr.





30,400


30,400


*Willow B. Shire





30,800


30,800


*Steven P. Hanson





28,500


28,500


*Robert A. Lundy





15,000


15,000


*Michael B. Green


50,000
(8)




50,000


*Martin C. Nuss


50,000
(9)

50,000


100,000


*All executive officers and Directors as a group (10 persons)


923,734


2,253,677


3,177,411


1.4
%


---

18

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19

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ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Certain Transactions with Related Persons

We are not currently a party to any related person transactions. However, in the event such a transaction is proposed or exists, the
Audit Committee of our Board of Directors is responsible for reviewing such transactions initially and on an ongoing basis and approving (if appropriate) all such transactions before their
commencement or continuation. The Audit Committee may, in its discretion, approve or deny any related person transactions and may require the cessation of such a transaction at any time. Approval of
related person transactions may be conditioned upon the related person and us following certain procedures set out by the Audit Committee. The Audit Committee will analyze certain factors in
determining whether to approve a related person transaction, which factors may include, but not be limited to the following:

whether
the terms of the transaction are fair to us;

benefits
us;

the
availability of other sources for comparable products or services;

the
impact, if any, on a director's independence;

whether
the transaction is material to us; and

the
terms available to unrelated third-parties or to employees generally.

Directors' Independence

Except for Christopher R. Gardner, our President, Chief Executive Officer and a director, all of our directors meet the independence
requirements set forth in the NASDAQ Marketplace Rules and the members of our Audit Committee also meet the additional independence requirements set forth in the NASDAQ Marketplace Rules and the SEC
for Audit Committee members.

ITEM 14.    PRINCIPAL ACCOUNTING FEES AND SERVICES

Fees Paid to Principal Accountants

The following table shows the approximate fees billed to us by BDO Seidman, LLP, our independent registered public accounting
firm:

2008

2007Audit Fees

$
2,376,850

$
5,718,794Audit-Related Fees





Tax Fees


120,450


170,000All Other Fees





Total

$
2,497,300

$
5,888,794


20

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Audit Fees

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

Tax Fees

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

Pre-Approval Policies and Procedures

The Audit Committee, in its sole discretion, pre-approved and reviewed audit and non-audit services performed
by our independent registered public accounting firm, as well as the fees charged for such services. Requests for approval are considered at each regularly scheduled Audit Committee meeting or, if
necessary, are approved by the unanimous consent of all members of the Audit Committee. In its pre-approval and
review of non-audit service fees, the Audit Committee considers, among other factors, the possible affect of the performance of such services on the auditors' independence. The Audit
Committee considered and pre-approved all services rendered during fiscal years 2008 and 2007.

21

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PART IV

ITEM 15.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES



See
the financial statements and financial statement schedules listed in Item 8. Financial Statements and Supplementary Data.



No.

Description3.1

Amended and Restated Certificate of Incorporation. (Incorporated by reference to Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for the period ended March 31, 2000 filed May 5,
2000).3.2

Bylaws. (Incorporated by reference to Exhibit 3.2 to the Company's current report on Form 8-K filed on December 2, 2004).4.1

Specimen of Registrant's Common Stock Certificate. (Incorporated by reference to the Company's Registration Statement on Form S-1 (File no. 33-43548), effective December 10, 1991 filed October 25,
1991).4.2

Rights Agreement dated as of March 3, 2003 between Vitesse Semiconductor Corporation and EquiServe Trust Company, N.A., as Rights Agent. (Incorporated by reference to Exhibit 1 to the Form 8-A12(g) filed
March 5, 2003.)4.3***

Vitesse Semiconductor Corporation Fiscal Year 2008 Executive Bonus Plan, dated as of January 24, 2008 (portions of this exhibit have been omitted pursuant to a request for confidential treatment).10.1

Second Amended and Restated Loan and Security Agreement between the Company and Silicon Valley Bank, as amended March 2, 2006 (Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed
May 18, 2006).10.2

Third Amended and Restated Loan and Security Agreement between the Company and Special Value Expansion Fund & Obsidian, as amended June 7, 2006 (Incorporated by reference to Exhibit 10.1 to the
Company's Form 8-K filed June 12, 2006).10.3

Security Agreement between the Company and Obsidian, dated as of June 7, 2006. (Incorporated by reference to Exhibit 10.2 to the Company's Form 8-K filed June 12, 2006).10.4

Fourth Amended and Restated Loan Security Agreement between the Company and Special Value Expansion Fund & Obsidian, as amended June 20, 2006. (Incorporated by reference to Exhibit 10.1 to the Company's
Form 8-K filed June 26, 2006).10.5

First Supplemental Indenture, dated November 3, 2006 between the Company and U.S. Bank National Assoc. as Trustee. (Incorporated by reference to Exhibit 99 to the Company's Form 8-K filed November 9,
2006).10.6

Employment Agreement between the Company and Michael Green dated January 2, 2007. (Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed January 31, 2007).10.7

Warrant Registration Rights Agreement, dated January 25, 2007. (Incorporated by reference to Exhibit 10.2 to the Company's Form 8-K filed January 31, 2007).10.8

Amended and Restated Employment Agreement between the Company and Richard Yonker dated June 26, 2007. (Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed June 29,
2007).


22

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No.

Description10.9

Amended and Restated Employment Agreement between the Company and Christopher Gardner dated July 27, 2007. (Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed August 2,
2007).10.10

2001 Stock Incentive Plan, Amended and Restated as of July 27, 2007. (Incorporated by reference to Exhibit 10.2 to the Company's Form 8-K filed August 2, 2007)10.11

Form of Indemnity Agreement between the directors and the Company. (Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed August 22, 2007).10.12

Purchase and Sale Letter Agreement, dated August 22, 2007 between the Company and Maxim Integrated Products, Inc. (Incorporated by reference to Exhibit 10.2 to the Company's Form 8-K filed
August 29, 2007).10.13

Loan Agreement, dated August 23, 2007 between the Company and Whitebox VSC, Ltd. (Incorporated by reference to Exhibit 10.3 to the Company's Form 8-K filed August 29, 2007).10.14

Senior Unsecured Convertible Note Purchase Agreement, dated August 23, 2007 between the Company and Whitebox VSC, Ltd. (Incorporated by reference to Exhibit 10.4 to the Company's Form 8-K filed
August 29, 2007).10.15

Second Supplemental Indenture, dated September 24, 2007 between the Company and U.S. Bank National Association. (Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed September 27,
2007).10.16

Term Note, dated October 29, 2007 between the Company and Whitebox VSC, Ltd. for $30 million. (Incorporated by reference to Exhibit 4.1 to the Company's Form 8-K filed October 31,
2007).10.17

Intellectual Property, Assignment and License Agreement, dated October 29, 2007 between the Company and Maxim Integrated Products, Inc. (Incorporated by reference to Exhibit 10.1 to the Company's
Form 8-K filed October 31, 2007).10.18

Letter Agreement, dated October 26, 2007 between the Company and Dr. Martin C. Nuss (Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed November 20, 2007).10.19

Indenture between Vitesse Semiconductor Corporation and U.S. Bank National Association, as Trustee (including form of 1.50% Convertible Subordinated Debentures due 2024), dated as of September 22, 2004. (Incorporated
by reference to Exhibit 10.1 to the Company's Form 8-K filed September 23, 2004).21.1*

Subsidiaries of Vitesse Semiconductor, Inc.23.1**

Consent of BDO Seidman, LLP31.1***

Rule13a-14(a) / 302 SOX Certification of Chief Executive Officer.31.2***

Rule13a-14(a) / 302 SOX Certification of Chief Financial Officer.32.1***

Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer.


---

23

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.

VITESSE SEMICONDUCTOR CORPORATION
(Registrant)Dated: January 28, 2009

By:

/s/ CHRISTOPHER R. GARDNER Chief Executive Officer


Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on
the date indicated.

Dated: January 28, 2009

By:

/s/ CHRISTOPHER R. GARDNER Director and Chief Executive OfficerDated: January 28, 2009

By:

/s/ RICHARD C. YONKER Chief Financial Officer
(Principal Financial and Accounting Officer)Dated: January 28, 2009

By:

/s/ GUY W. ADAMS DirectorDated: January 28, 2009

By:

/s/ VINCENT CHAN, PH.D DirectorDated: January 28, 2009

By:

/s/ STEVEN P. HANSON DirectorDated: January 28, 2009

By:

/s/ ROBERT A. LUNDY DirectorDated: January 28, 2009

By:

/s/ EDWARD ROGAS, JR. DirectorDated: January 28, 2009

By:

/s/ WILLOW B. SHIRE Director


24

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