Document:

exv10w4

 

Exhibit 10.4

[MINDSPEED TECHNOLOGIES, INC. LETTERHEAD]

(Date)

(Name)

(Address)

Global ID Number: XXX-XX-ACCT

Dear (Name):

We are pleased to notify you that the Board of Directors of Mindspeed Technologies, Inc. (the
“Company”) has granted you the following Stock Option Award.

	 	 	 	 	 	 	 	 	 
	Grant Date	 	Granted from Mindspeed Plan	 	Option Type	 	Option Price	 	Number of Options
	(Date)

	 	2003 Long-Term Incentives Plan
	 	(Incentive Stock

Option or

Non-Qualified)
	 	(Price)
	 	(Options)

This Stock Option Award (this “Award”) has been granted pursuant to, and is controlled by: (i) the
Mindspeed Technologies, Inc. 2003 Long-Term Incentives Plan (the “Plan”); (ii) the Stock Option
Terms and Conditions (the “Plan Terms”); and (iii) this Award. This Award may be exercised only
upon the terms and conditions of the Plan and the Plan Terms. The Plan and the Plan Terms are
incorporated into this Award as if fully set forth herein.

The options may be exercised, in whole or in part (but only for a whole number of shares) and at
one time or from time to time per the vesting schedule below. All exercises must take place at
least one day prior to the expiration of the Option. The number of shares you may purchase as of
any date cannot exceed the total number of shares vested by that date, less any shares you have
previously acquired by exercising this Option.

	 	 	 	 	 
	 

	 	Vesting Schedule	 	 
	 

	 	(monthly, quarterly, semi-annually, annual, specified dates or cliff vesting based upon continued employment)	 	 

All documents relating to this Award are available for viewing and printing on the Human Resources
Department Website. To access this information, please go to Mindspeed MyNet, select Directory,
Site Directory, Human Resources, Stock Administration. The documents available for viewing and
printing at this website location are the Plan, the Plan Terms, the most recent Plan Prospectus,
the Company’s most recent Annual Report on Form 10-K and the Company’s Insider Trading Policy. If
you choose not to download these documents, if you do not have access to Mindspeed MyNet or if you
encounter problems accessing this site, please contact Stock Administration at (949) 579-4525 or
stock.admin@mindspeed.com to receive paper copies of these documents at no cost. Please read all
documents carefully.

If you have any questions regarding this grant, please contact Stock Administration at (949)
579-4525 or via email at stock.admin@mindspeed.com.

	 	 	 
	 

	 	MINDSPEED TECHNOLOGIES, INC.<PAGE>

                                                                    EXHIBIT 10.5

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                          MINDSPEED TECHNOLOGIES, INC.
                         2003 LONG-TERM INCENTIVES PLAN
                       AWARD AGREEMENT FOR U.S. EMPLOYEES
                        STOCK OPTION TERMS AND CONDITIONS

1.    Definitions

      Capitalized terms used and not defined herein shall have the respective
      meanings assigned to such terms in the Plan. As used in these Stock Option
      Terms and Conditions, the following words and phrases shall have the
      respective meanings ascribed to them below unless the context in which any
      of them is used clearly indicates a contrary meaning:

      (a)   AWARD AGREEMENT: These Stock Option Terms and Conditions together
            with the Grant Letter.

      (b)   CAUSE: (i) A felony conviction of a Participant; (ii) the commission
            by a Participant of an act of fraud or embezzlement against the
            Company and/or a Subsidiary; (iii) willful misconduct or gross
            negligence materially detrimental to the Company and/or a
            Subsidiary; (iv) the Participant's continued failure to implement
            reasonable requests or directions received in the course of his or
            her employment; (v) the Participant's wrongful dissemination or use
            of confidential or proprietary information; or (vi) the intentional
            and habitual neglect by the Participant of his or her duties to the
            Company and/or a Subsidiary.

      (c)   DISABILITY: Permanent and total disability within the meaning of the
            Company's long-term disability plan, as it may be amended from time
            to time, or, if there is no such plan, as determined by the
            Committee.

      (d)   FAST: Fidelity's automated service telephone system that is used to
            facilitate stock option transactions.

      (e)   FIDELITY: Fidelity Stock Plan Services, the stock option
            administrator whom the Company has engaged to administer and process
            all stock option exercises.

      (f)   GRANT LETTER: The letter from the Company granting the stock option
            or stock options to the Employee or Non-Employee.

      (g)   MINDSPEED: Mindspeed Technologies, Inc., a Delaware corporation.

      (h)   NASDAQ: The Nasdaq National Market.

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      (i)   OPTIONS: The stock option or stock options listed in the first
            paragraph of the Grant Letter and which together with these Stock
            Option Terms and Conditions constitutes the Award Agreement.

      (j)   OPTION SHARES: The shares of Mindspeed Common Stock issuable or
            transferable on exercise of the Options.

      (k)   PLAN: Mindspeed's 2003 Long-Term Incentives Plan, as such Plan may
            be amended and in effect at the relevant time.

      (l)   RETIREMENT: Retirement at or after age sixty two (62) or, with the
            advance consent of the Committee, before age sixty two (62) but at
            or after age fifty five (55).

      (m)   WEB: Fidelity's website that is used to facilitate stock option
            transactions and is accessible through Mindspeed MyNet.

2.    When Options May be Exercised

      The Options are vested and may be exercised in accordance with the
      schedule included in the Grant Letter, provided that:

      (a)   if you die while an employee of Mindspeed, your estate, or any
            person who acquires the Options by bequest or inheritance, may
            exercise all the Options not theretofore exercised, within (and only
            within) the period beginning on your date of death (even if you die
            before you have become entitled to exercise all or any part of the
            Options) and ending three (3) years thereafter;

      (b)   if your employment by Mindspeed terminates other than by death,
            then:

            (i)   if your employment by Mindspeed is terminated for Cause, the
                  Options shall expire forthwith upon your termination and may
                  not be exercised thereafter; and

            (ii)  if your employment by Mindspeed terminates for any reason
                  (including Retirement or Disability) not specified in
                  subparagraph (a) or in clause (i) of this subparagraph (b),
                  you (or if you die after your termination date, your estate or
                  any person who acquires the Options by bequest or inheritance)
                  may thereafter exercise the Options within (and only within)
                  the period ending three (3) months after your termination
                  date, but only to the extent they were exercisable on your
                  termination date, it being understood that neither (i) your
                  transfer from Mindspeed to a Subsidiary or affiliate of

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                  Mindspeed, whether or not incorporated, or vice versa, or from
                  one Subsidiary or affiliate of Mindspeed to another, nor (ii)
                  a leave of absence duly authorized in writing by Mindspeed,
                  shall be deemed a termination of employment; and

      (c)   the beginning exercise date of any unexercisable Options will be
            delayed for the length of time during which you are on an unpaid
            leave of absence duly authorized in writing by Mindspeed that
            exceeds six (6) months.

      The Committee may, in its discretion, extend the period during which
      Options may be exercised beyond the period set forth in subparagraphs (a)
      and (b)(ii) above, but in no event shall the provisions of the foregoing
      subparagraphs (a) or (b)(ii) extend to a date more than eight (8) years
      after the date of the grant, the period during which the Options may be
      exercised.

3.    Exercise Procedure

      (a)   To exercise all or any part of the Options, you (or after your
            death, your estate or any person who has acquired the Options by
            bequest or inheritance) must:

            (i)   contact the administrator, Fidelity, by using the FAST or Web
                  system or by speaking to a Fidelity customer service
                  representative and follow the instructions provided;

            (ii)  confirm the Option transaction by receiving a confirmation
                  number through the FAST or Web system or by speaking to a
                  Fidelity customer service representative;

            (iii) submit full payment of the exercise price for the Option
                  Shares to be purchased on exercise of the Options:

                  -     by check or cash; or

                  -     in shares of Stock; or

                  -     in a combination of check or cash and shares of Stock;
                        and

            (iv)  provide, in the case of any person other than you seeking to
                  exercise the Options, such documents as Fidelity or the
                  Secretary of Mindspeed shall require to establish to their
                  satisfaction that the person seeking to exercise the Options
                  is entitled to do so.

      (b)   An exercise of the whole or any part of the Options shall be
            effective:

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            (i)   if you elect (or after your death, the person entitled to
                  exercise the Options elects) to pay the exercise price for the
                  Option Shares entirely by check or cash, (1) upon confirmation
                  of your transaction by using the FAST or Web system or by
                  speaking to a Fidelity customer service representative and
                  full payment of the exercise price and withholding taxes (if
                  applicable) being received by Fidelity within three (3)
                  business days following the confirmation; and (2) receipt of
                  any documents required pursuant to Section 3(a)(iv); and

            (ii)  if you elect (or after your death, the person entitled to
                  exercise the Options elects) to pay the exercise price of the
                  Option Shares in shares of Stock or in a combination of shares
                  of Stock and check or cash, (1) upon confirmation of your
                  transaction by using the FAST or Web system or by speaking to
                  a Fidelity customer service representative and full payment of
                  the exercise price (as defined in Section 3(d)(i)) and
                  withholding taxes (if applicable) being received by Fidelity
                  within three (3) business days following the confirmation; and
                  (2) receipt of any documents required pursuant to Section
                  3(a)(iv).

      (c)   If you choose (or after your death, the person entitled to exercise
            the Options chooses) to pay the exercise price for the Option Shares
            to be purchased on exercise of any of the Options entirely by check
            or cash, payment must be made by:

                  -     delivering to Fidelity a check or cash in the full
                        amount of the exercise price for those Option Shares; or

                  -     arranging with a stockbroker, bank or other financial
                        institution to deliver to Fidelity full payment, by
                        check, cash or (if prior arrangements are made with
                        Fidelity) by wire transfer, of the exercise price of
                        those Option Shares.

            In either event, in accordance with Section 3(e), full payment of
            the exercise price for the Option Shares purchased must be made
            within three (3) business days after the exercise has been conducted
            and confirmed through the FAST or Web system or by speaking to a
            Fidelity customer service representative.

      (d)   (i)   If you choose (or after your death, the person entitled to
                  exercise the Options chooses) to use already-owned Stock to
                  pay all or part of the exercise price for the Option Shares to
                  be purchased on exercise of any of the Options, you (or after
                  your death, the person entitled to exercise the Options) must
                  deliver to Fidelity one or more certificates (and executed
                  stock powers), or authorize the book-entry transfer to
                  Mindspeed of shares of Stock, representing:

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                  -     at least the number of shares of Stock whose value,
                        based on the closing price of the Stock reported on
                        NASDAQ on the day you exercised your Options through the
                        FAST or Web system or by speaking to a Fidelity customer
                        service representative, equals the exercise price for
                        those Option Shares; or

                  -     any lesser number of shares of Stock you desire (or
                        after your death, the person entitled to exercise the
                        Options desires) to use to pay the exercise price for
                        those Option Shares and a check or cash in the amount of
                        such exercise price less the value of the Stock
                        delivered, based on the closing price of the Stock
                        reported on NASDAQ on the day you exercised your Options
                        through the FAST or Web system or by speaking to a
                        Fidelity customer service representative.

                  In the event you are using shares of Stock acquired from a
                  Mindspeed benefit plan, including but not limited to a stock
                  option plan, restricted stock plan, performance share plan and
                  employee stock purchase plan, these shares of Stock must have
                  been held for a minimum of six (6) months from the date of
                  acquisition. You will be required to provide proper
                  documentation attesting to the fact that the shares of Stock
                  used to pay all or part of the exercise price for the Option
                  Shares are mature shares of Stock. In the event you are using
                  shares of Stock purchased on the open market, there is no
                  required holding period.

            (ii)  Fidelity will advise you (or any other person who, being
                  entitled to do so, exercises the Options) of the exact number
                  of shares of Stock, valued in accordance with Section 4 of the
                  Plan at the closing price reported on NASDAQ on the effective
                  date of exercise under Section 3(a)(ii), and any funds
                  required to pay in full the exercise price for the Option
                  Shares purchased. In accordance with Section 3(e), you (or
                  such other person) must pay, by check or cash, in shares of
                  Stock or in a combination of check or cash and shares of
                  Stock, any balance required to pay in full the exercise price
                  of the Option Shares purchased within three (3) business days
                  following the confirmation of such exercise of the Options
                  under Section 3(a)(ii).

            (iii) Notwithstanding any other provision of the Award Agreement,
                  the Secretary of Mindspeed may limit the number, frequency or
                  volume of successive exercises of any of the Options in which
                  payment is made, in whole or in part, by delivery of shares of
                  Stock pursuant to this subparagraph (d) to prevent
                  unreasonable pyramiding of such exercises.

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      (e)   An exercise conducted and confirmed through the FAST or Web system
            or by speaking to a Fidelity customer service representative,
            whether or not full payment of the exercise price for the Option
            Shares is received by Fidelity, shall constitute a binding
            contractual obligation by you (or the other person entitled to
            exercise the Options) to proceed with and complete that exercise of
            the Options (but only so long as you continue, or the other person
            entitled to exercise the Options continues, to be entitled to
            exercise the Options on that date). By your acceptance of this Award
            Agreement, you agree (for yourself and on behalf of any other person
            who becomes entitled to exercise the Options) to deliver or cause to
            be delivered to Fidelity any balance of the exercise price for the
            Option Shares to be purchased upon the exercise pursuant to the
            transaction conducted through the FAST or Web system or by speaking
            to a Fidelity customer service representative required to pay in
            full the exercise price for those Option Shares, that payment being
            by check, cash, wire transfer, in shares of Stock or in a
            combination of check or cash and shares of Stock, on or before the
            third (3rd) business day after the date on which you confirm the
            transaction through the FAST or Web system or by speaking to a
            Fidelity customer service representative. If such payment is not
            made, you (for yourself and on behalf of any other person who
            becomes entitled to exercise the Options) authorize Mindspeed, in
            its discretion, to set off against salary payments or other amounts
            due or which may become due you (or the other person entitled to
            exercise the Options) any balance of the exercise price for those
            Option Shares remaining unpaid thereafter.

      (f)   A book-entry statement representing the number of Option Shares
            purchased will be issued as soon as practicable (i) after Fidelity
            has received full payment therefor or (ii) at Mindspeed's or
            Fidelity's election in their sole discretion, after Mindspeed or
            Fidelity has received (x) full payment of the exercise price of
            those Option Shares and (y) any reimbursement in respect of
            withholding taxes due pursuant to Section 5.

4.    Transferability

      No Options or portion thereof shall be transferable by you otherwise than
      (i) by will or by laws of descent and distribution, (ii) by gift to
      members of your immediate family, (iii) to a trust established for the
      benefit of your immediate family members only, (iv) to a partnership in
      which your immediate family members are the only partners or (v) as
      otherwise determined by the Committee. For purposes of the Plan,
      "immediate family" shall mean your spouse and natural, adopted or
      step-children and grandchildren. Notwithstanding any transfer of an Option
      or portion thereof, the transferred Option shall continue to be subject to
      the Plan and Award Agreement as were applicable to you immediately prior
      to the transfer, as if the Option had not been transferred.

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5.    Withholding

      Mindspeed or Fidelity shall have the right, in connection with the
      exercise of the Options in whole or in part, to deduct from any payment to
      be made by Mindspeed or Fidelity under the Plan an amount equal to the
      taxes required to be withheld by law with respect to such exercise or to
      require you (or any other person entitled to exercise the Options) to pay
      to it an amount sufficient to provide for any such taxes so required to be
      withheld. By your acceptance of this Award Agreement, you agree (for
      yourself and on behalf of any other person who becomes entitled to
      exercise the Options) that if Mindspeed or Fidelity elects to require you
      (or such other person) to remit an amount sufficient to pay such
      withholding taxes, you (or such other person) must remit that amount
      within three (3) business days after the confirmation of the Option
      exercise (Section 3(a)(ii)). If such payment is not made, Mindspeed, in
      its discretion, shall have the same right of set-off with respect to
      payment of the withholding taxes in connection with the exercise of the
      Option as provided under Section 3(e) with respect to payment of the
      exercise price.

6.    Rights as Shareholder

      You will not have any rights as a shareholder with respect to any Option
      Shares unless and until you become the holder of such Option Shares on the
      books and records of Mindspeed.

7.    Headings

      The section headings contained in these Stock Option Terms and Conditions
      are solely for the purpose of reference, are not part of the agreement of
      the parties and shall in no way affect the meaning or interpretation of
      this Award Agreement.

8.    References

      All references in these Stock Option Terms and Conditions to sections,
      paragraphs, subparagraphs or clauses shall be deemed to be references to
      sections, paragraphs, subparagraphs and clauses of these Stock Option
      Terms and Conditions unless otherwise specifically provided.

9.    Amendment and Termination

      I understand that Mindspeed has reserved the right to amend or terminate
      the Plan at any time, and that the grant of an Option in one year or at
      one time does not in any way obligate Mindspeed or its affiliates to make
      a grant in any future year or in any given amount. I acknowledge and
      understand that the grant is wholly discretionary in nature and is not to
      be considered part of any normal or expected compensation that is or would
      be subject to

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      severance, resignation, redundancy or similar pay, other than to the
      extent required by local law.

10.   Entire Agreement

      This Award Agreement and the Plan embody the entire agreement and
      understanding between Mindspeed and you with respect to the Options, and
      there are no representations, promises, covenants, agreements or
      understandings with respect to the Options other than those expressly set
      forth in this Award Agreement and the Plan.

11.   Applicable Laws and Regulations

      This Award Agreement and Mindspeed's obligation to issue Option Shares
      hereunder are governed by the laws of the State of Delaware, without
      regard to its conflicts of laws principles, and the Federal law of the
      United States.

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