exv10w1



 





EXHIBIT 10.1




Mindspeed Technologies, Inc.




Directors Stock Plan




as amended and restated




 







	1.	 	PURPOSE OF THE PLAN.
	 
	 	 	The purpose of the Directors Stock Plan (as amended and restated, the Plan) is to link the
compensation of non-employee directors of Mindspeed Technologies, Inc. (Mindspeed) directly
with the interests of the Mindspeed shareholders.
	 
	2.	 	PARTICIPANTS.
	 
	 	 	Participants in the Plan shall consist of directors of Mindspeed who are not employees of
Mindspeed or any of its subsidiaries (Non-Employee Director). The term “subsidiary” as used
in the Plan means a corporation more than 50% of the voting stock of which, or an
unincorporated business entity more than 50% of the equity interest in which, shall at the
time be owned directly or indirectly by Mindspeed.
	 
	3.	 	SHARES RESERVED UNDER THE PLAN.
	 
	 	 	Subject to the provisions of Section 11 of the Plan, there shall be reserved for delivery
under the Plan, from the date of inception of the Plan, an aggregate of 1,440,000 shares of
common stock, par value $.01 per share, of Mindspeed (Shares). Shares to be delivered under
the Plan may be authorized and unissued Shares, Shares held in treasury or any combination
thereof. Shares delivered under the Plan which are forfeited or otherwise terminated shall
be available for subsequent grant under the Plan.




 









 






	4.	 	ADMINISTRATION OF THE PLAN.
	 
	 	 	The Plan shall be administered by the Compensation and Management Development Committee (the
Committee) of the Board, subject to the right of the Board, in its sole discretion, to
exercise or authorize another committee or person to exercise some or all of the
responsibilities, powers and authority vested in the Committee under the Plan. The Committee
(or the Board or any other committee or person authorized by the Board) shall have authority
to interpret the Plan, and to prescribe, amend and rescind rules and regulations relating to
the administration of the Plan, and all such interpretations, rules and regulations shall be
conclusive and binding on all persons.
	 
	5.	 	EFFECTIVE DATE OF THE PLAN.
	 
	 	 	The Plan has been approved by the Board and shall be submitted to Conexant Systems, Inc.
(Conexant), the sole shareholder of Mindspeed, for approval and, if approved, shall become
effective on the date on which Conexant completes the pro rata distribution of all
outstanding Shares to Conexant’s shareowners (the Distribution).
	 
	6.	 	STOCK OPTIONS.
	 
	 	 	Each Non-Employee Director in office at the time of the Distribution shall be granted, on the
first trading day following the Distribution or on such later date within 60 days thereafter
as the Board may designate, an option to purchase 40,000 Shares. Each other Non-Employee
Director shall be granted an option to purchase 40,000 Shares at the meeting of the Board at
which, or following the Annual Meeting of Shareholders at which, the Non-Employee Director is
first elected a director of Mindspeed. Following the Annual Meeting of Shareholders held in
the year 2004 and each Annual Meeting of Shareholders




2









 






	 	 	thereafter, each Non-Employee Director who is elected a director at, or who was previously
elected and continues as a director after, that Annual Meeting shall be granted an option to
purchase 20,000 Shares, provided that the Board may, by action taken on or before the day
following the date of any such Annual Meeting, defer the option grants in respect of such
Annual Meeting for up to 60 days following such Annual Meeting to a date coinciding with the
date of grant of options or other incentive compensation by Mindspeed to some or all of the
officers of Mindspeed.
	 
	 	 	The exercise price per share for each option granted under the Plan shall be the closing
price per share (the Fair Market Value) of Shares on the date of grant as reported on the
Nasdaq Stock Market or such other national securities exchange or automated inter-dealer
quotation system on which the Shares have been duly listed and approved for quotation and
trading (or on the next preceding day such stock was traded if it was not traded on the date
of grant). The purchase price of the Shares with respect to which an option or portion
thereof is exercised shall be payable in full in cash, Shares valued at their Fair Market
Value on the date of exercise, or a combination thereof. Each option may be exercised in
whole or in part at any time after it becomes exercisable; and each option shall become
exercisable in four approximately equal installments on each of the first, second, third and
fourth anniversaries of the date the option is granted. No option shall be exercisable prior
to one year nor after ten years from the date of the grant thereof; provided, however, that
if the holder of an option dies, the option may be exercised from and after the date of the
optionee’s death for a period of three years (or until the expiration date specified in the
option if earlier) even if it was not exercisable at the date of death. Moreover, if an
optionee retires after attaining age 55 and completing at least five years service as a




3









 






	 	 	director, all options then held by such optionee shall be exercisable even if they were not
exercisable at such retirement date; provided, however, that each such option shall expire at
the earlier of five years from the date of the optionee’s retirement or the expiration date
specified in the option.
	 
	 	 	Options granted under the Plan are not transferable other than (i) by will or by the laws of
descent and distribution; or (ii) by gift to the grantee’s spouse or natural, adopted or
step- children or grandchildren (Immediate Family Members) or to a trust for the benefit of
one or more of the grantee’s Immediate Family Members or to a family charitable trust
established by the grantee or a member of the grantee’s family. If an optionee ceases to be
a director while holding unexercised options, such options are then void, except in the case
of (i) death, (ii) disability, (iii) retirement after attaining age 55 and completing at
least five years service as a director, or (iv) resignation from the Board for reasons of the
antitrust laws, compliance with Mindspeed’s conflict of interest policies or other
circumstances that the Committee may determine as serving the best interests of Mindspeed.
	 
	7.	 	RESTRICTED STOCK UNITS.
	 
	 	 	Following the Annual Meeting of Shareholders held in the year 2008 and each Annual Meeting of
Shareholders thereafter, each Non-Employee Director who is elected a director at, or who was
previously elected and continues as a director after, that Annual Meeting shall be granted
restricted stock units (Restricted Stock Units) in an amount equal to the lesser of (a)
15,000 Restricted Stock Units or (b) the number of Restricted Stock Units (rounded to the
nearest whole unit) equaling $45,000 divided by the closing price of Shares on the date of
grant as reported on the Nasdaq Stock Market or such other national




4









 






	 	 	securities exchange or automated inter-dealer quotation system on which the Shares have been
duly listed and approved for quotation and trading (or on the next preceding day such stock
was traded if it was not traded on the date of grant). For the purpose of the calculation in
the previous sentence, one Restricted Stock Unit shall equal one Share.
	 
	 	 	The recipient shall not have the rights of a shareholder until such time as the Shares
underlying the Restricted Stock Units are settled by the issuance of such Shares to the
Non-Employee Director. However, the recipient will receive dividends in respect of the
Shares underlying the Restricted Stock Units, which will be paid if and when such dividends
are normally paid to Mindspeed shareholders. Upon receipt of the Shares underlying the
Restricted Stock Units, the recipient shall have the right to vote the Shares. One Share
shall be issuable for each Restricted Stock Unit awarded.
	 
	 	 	Restricted Stock Units issued under this Section 7 shall not be settled, and such Shares
shall not be issued, until ten days after (i) the recipient retires from the Board after
attaining age 55 and completing at least five years service as a director or (ii) the
recipient resigns from the Board or ceases to be a director by reason of the antitrust laws,
compliance with Mindspeed’s conflict of interest policies, death, disability or other
circumstances, and the Board has not determined (prior to the expiration of such ten day
period) that such resignation or cessation of service as a director is adverse to the best
interests of Mindspeed.
	 
	 	 	The settlement of the Restricted Stock Units as described above shall be delayed in the event
Mindspeed reasonably determines that the issuance of the Shares would constitute a violation
of federal securities laws or other applicable law. If the settlement of the




5









 






	 	 	Restricted Stock Units is delayed by the provisions of this paragraph, the settlement of the
Restricted Stock Units shall occur at the earliest date at which Mindspeed reasonably
determines that issuing the Shares will not cause a violation of federal securities laws or
other applicable law. For purposes of this paragraph, the issuance of Shares that would
cause inclusion in gross income or the application of any penalty provision or other
provision of the Internal Revenue Code of 1986, as amended (the Code), is not considered a
violation of applicable law.
	 
	8.	 	SHARES OR RESTRICTED STOCK UNITS IN LIEU OF CASH COMPENSATION.
	 
	 	 	Each Non-Employee Director may elect each year, not later than December 31 of the year
preceding the year as to which an election is to be applicable, to receive all or any portion
of the cash retainer to be paid for board, committee or other service in the following
calendar year through the issuance or transfer of Shares, valued at the closing price as
reported on the Nasdaq Stock Market or such other national securities exchange or automated
inter-dealer quotation system on which the Shares have been duly listed and approved for
quotation and trading, on the date when each payment of such retainer amount would otherwise
be made in cash (or on the next preceding day such stock was traded if it was not traded on
that date). Each Non-Employee Director making such an election may also elect at the same
time to receive the value of those Shares in the form of Restricted Stock Units. The
recipient shall not have the rights of a shareholder until such time as the Shares underlying
the Restricted Stock Units are settled by the issuance of such Shares to the Non-Employee
Director. However, the recipient will receive dividends in respect of the Shares underlying
the Restricted Stock Units, which will be paid if and when such dividends are normally paid
to Mindspeed shareholders. Upon receipt of the Shares




6









 






	 	 	underlying the Restricted Stock Units, the recipient shall have the right to vote the Shares.
One Share shall be issuable for each Restricted Stock Unit awarded.
	 
	 	 	Restricted Stock Units issued under this Section 8 shall not be settled, and such Shares
shall not be issued, until ten days after (i) the recipient retires from the Board after
attaining age 55 and completing at least five years service as a director or (ii) the
recipient resigns from the Board or ceases to be a director by reason of the antitrust laws,
compliance with Mindspeed’s conflict of interest policies, death, disability or other
circumstances, and the Board has not determined (prior to the expiration of such ten day
period) that such resignation or cessation of service as a director is adverse to the best
interests of Mindspeed.
	 
	 	 	The settlement of the Restricted Stock Units as described above shall be delayed in the event
Mindspeed reasonably determines that the issuance of the Shares would constitute a violation
of federal securities laws or other applicable law. If the settlement of the Restricted
Stock Units is delayed by the provisions of this paragraph, the settlement of the Restricted
Stock Units shall occur at the earliest date at which Mindspeed reasonably determines that
issuing the Shares will not cause a violation of federal securities laws or other applicable
law. For purposes of this paragraph, the issuance of Shares that would cause inclusion in
gross income or the application of any penalty provision or other provision of the Code is
not considered a violation of applicable law.
	 
	9.	 	RESTRICTED STOCK.
	 
	 	 	The Board or the Committee may, from time to time, as and when either thereof deems it
appropriate, provide one or more Non-Employee Directors with a grant of Restricted




7









 






	 	 	Stock, subject to the terms, conditions and restrictions established by the Board or the
Committee at the time of grant.
	 
	10.	 	ADDITIONAL COMPENSATION.
	 
	 	 	The Board or the Committee may, from time to time, as and when either thereof deems it
appropriate, provide one or more Non-Employee Directors with additional compensation under
the Plan. Such additional compensation may be in the form of a grant of Shares, Restricted
Stock, Restricted Stock Units, options to purchase Shares or a combination thereof, subject
to the terms, conditions and restrictions established by the Board or the Committee at the
time of grant.
	 
	11.	 	ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.
	 
	 	 	If there shall be any change in or affecting Shares on account of any merger, consolidation,
reorganization, recapitalization, reclassification, stock dividend, stock split or
combination, or other distribution to holders of Shares (other than a cash dividend), there
shall be made or taken such amendments to the Plan and such adjustments and actions
thereunder as the Board may deem appropriate under the circumstances.
	 
	12.	 	GOVERNMENT AND OTHER REGULATIONS.
	 
	 	 	The obligations of Mindspeed to deliver Shares upon exercise of options granted under Section
6 of the Plan, upon vesting and settlement of Restricted Stock Units pursuant to Section 7 or
an election made under Section 8 or the delivery of Shares pursuant to an election made under
Section 8 of the Plan or grants made under Section 9 or Section 10 of the Plan, shall be
subject to (i) all applicable laws, rules and regulations and such approvals by any
governmental agencies as may be required, including, without limitation,




8









 






	 	 	compliance with the Securities Act of 1933, as amended, and (ii) the condition that such
Shares shall have been duly listed and approved for quotation and trading on the Nasdaq Stock
Market, or such other national securities exchange or automated inter-dealer quotation system
as shall be approved by the Board.
	 
	13.	 	AMENDMENT AND TERMINATION OF THE PLAN.
	 
	 	 	The Plan may be amended by the Board in any respect, provided that, without shareholder
approval, no amendment shall (i) materially increase the maximum number of Shares available
for delivery under the Plan (other than adjustments pursuant to Section 11 hereof), (ii)
materially increase the benefits accruing to participants under the Plan, or (iii) materially
modify the requirements as to eligibility for participation in the Plan. The Plan may also
be terminated at any time by the Board.
	 
	14.	 	MISCELLANEOUS.
	 
		 	(a) If a Change of Control as defined in Article III, Section 14(I)(1) of Mindspeed’s Bylaws
shall occur, all options then outstanding pursuant to the Plan shall forthwith become fully
exercisable whether or not then exercisable, all Restricted Stock Units shall become fully
vested and settled by the issuance of Shares, and the restrictions on all Shares granted as
Restricted Stock under the Plan shall forthwith lapse; provided, however, that each such
option shall expire at the earlier of five years from the date of the Change of Control or
the expiration date specified in the option.
	 
		 	(b) Nothing contained in the Plan shall be deemed to confer upon any person any right to
continue as a director of or to be associated in any other way with Mindspeed.
	 
		 	(c) To the extent that Federal laws do not otherwise control, the Plan and all determinations
made and actions taken pursuant hereto shall be governed by the law of the State of Delaware.






9