Amended Tender Offer Statement by Third Party (sc To-t/a)

UNITED STATES SECURITIES AND EXCHANGE

COMMISSION

Washington, D.C. 20549

SCHEDULE TO

(RULE 14d-100)

TENDER OFFER STATEMENT UNDER SECTION 14(d)(1) OR 13(e)(1)

OF THE SECURITIES EXCHANGE ACT OF 1934

Amendment No. 3

VITESSE SEMICONDUCTOR CORPORATION

(Name of Subject Company (Issuer))

LLIU100 ACQUISITION CORP.

(Offeror)

A Wholly Owned Subsidiary of

MICROSEMI CORPORATION

(Parent of Offeror)

(Names of Filing Persons (identifying status as offeror, issuer or other person))

COMMON STOCK, PAR VALUE $0.01 PER SHARE

(Title of Class of Securities)

928497304

(CUSIP Number of Class of Securities)

David Goren, Esq.

Senior Vice President and Chief Legal and Compliance Officer

Microsemi Corporation

One Enterprise

Aliso Viejo, California 92656

(949) 380-6100

(Name, address, and telephone numbers of person authorized to receive notices and communications on behalf of filing persons)

Copies to:

Warren T. Lazarow, Esq.

O’Melveny & Myers LLP

2765 Sand Hill Road

Menlo Park, CA 94025-7019

(650) 473-2600

CALCULATION OF FILING FEE


Transaction Valuation(1)		Amount of Filing Fee(2)
$401,238,831.84		$46,623.95

(1)

Estimated for purposes of calculating the amount of the filing fee only. The transaction valuation was calculated by adding the sum of (i) 69,285,528 shares of common stock, par value $0.01 per share, of Vitesse Semiconductor Corporation (the “Company”) issued and outstanding multiplied by the offer price of $5.28 per share as of March 27, 2015; (ii) 3,043,024 shares of common stock of the Company potentially issuable upon conversion of outstanding in-the-money stock options as of March 27, 2015 multiplied by the offer price of $5.28 per share less the weighted average exercise price for such options of $3.34 per share, (iii) 3,233,651 shares of common stock of the Company subject to outstanding restricted stock units as of March 27, 2015, multiplied by the offer price of $5.28 per share, and (iv) up to 430,000 shares of common stock of the Company which constitutes the maximum number of shares that may be issued prior to the expiration of the Offer under the Amended and Restated 2011 Employee Stock Purchase Plan of the Company multiplied by the offer price of $5.28 per share. The calculation of the filing fee is based on information provided by the Company of March 27, 2015.

(2)	The filing fee was calculated in accordance with Rule 0-11 under the Securities Exchange Act of 1934, as amended, and Fee Rate Advisory No. 1 for Fiscal Year 2015, issued August 29, 2014, by multiplying the Transaction Valuation by 0.0001162.

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

Amount Previously Paid: $46,623.95

Filing Party: LLIU100 Acquisition

Corp. and Microsemi Corporation

Form of Registration No.: Schedule TO

Date Filed: March 31, 2015

¨	Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.

Check the appropriate boxes below to designate any transactions to which the statement relates:


x Third-party tender offer subject to Rule 14d-1.		¨ Issuer tender offer subject to Rule 13e-4.
¨ Going-private transaction subject to Rule 13e-3.		¨ Amendment to Schedule 13D under Rule 13d-2.

Check the following box if the filing is a final amendment reporting the results of the tender offer. ¨

*If applicable, check the appropriate box(es) below to designate the appropriate rule provision(s) relied upon:

¨	Rule 13e-4(i) (cross-border issuer tender offer).

¨	Rule 14d-1(d) (cross-border third-party tender offer).

This Amendment No. 3 (this “Amendment No. 3”) amends and supplements the Tender Offer Statement on Schedule TO originally filed with the Securities and Exchange Commission on March 31, 2015 (together with any amendments and supplements thereto, including that certain Amendment No. 1 filed on April 1, 2015 and that certain Amendment No. 2 filed on April 8, 2015, the “Schedule TO”), by (i) LLIU100 Acquisition Corp., a Delaware corporation (“Purchaser”) and wholly owned subsidiary of Microsemi Corporation, a Delaware corporation (“Parent”), and (ii) Parent. The Schedule TO relates to the offer (the “Offer”) by the Purchaser to purchase all of the outstanding shares of common stock, par value $0.01 per share (the “Company Shares”), of Vitesse Semiconductor Corporation, a Delaware corporation (the “Company”), at a purchase price of $5.28 per Company Share, net to the tendering stockholder in cash, without interest and less any required withholding taxes, upon the terms and subject to the conditions set forth in the Offer to Purchase dated March 31, 2015 (together with any amendments and supplements thereto, the “Offer to Purchase”) and in the related Letter of Transmittal, copies of which are attached as Exhibits (a)(1)(A) and (a)(1)(B), respectively, to the Schedule TO. Capitalized terms used in this Amendment No. 3 but not defined herein shall have the respective meaning given to such terms in the Schedule TO.

Items 4 and 11

Items 4 and 11 of the Schedule TO are hereby amended and supplemented as follows:

Section 16—“Certain Legal Matters; Regulatory Approvals.” of the Offer to Purchase is hereby amended by deleting the subsection entitled “Legal Proceedings.” in its entirety and replacing it with the following paragraphs:

Legal Proceedings. On March 23, 2015, members of the Company Board, Purchaser, and Parent were named as defendants in an alleged class action lawsuit brought by a purported Company stockholder challenging the proposed transaction, which was filed in the Court of Chancery of the State of Delaware Court, and captioned Jefferson Mattox v. Christopher Gardner. et al., Case Number 10828 (which we refer to as the “Mattox Action”). The Mattox Action purports to be brought individually and as a class action on behalf of the Company’s stockholders and generally alleges that, among other things, (i) each member of the Company Board breached his fiduciary duties in connection with the transactions contemplated by the Merger Agreement, (ii) Purchaser and Parent allegedly aided and abetted those breaches, and (iii) the proposed compensation payable to plaintiff and the class in the Transaction is unfair and inadequate. The Mattox Action seeks, among other relief, to enjoin the defendants from consummating the transactions contemplated by the Merger Agreement, rescission or rescissory damages to the extent such transactions are consummated and attorneys’ fees and costs.

On March 27, 2015, the Company, members of the Company Board, Purchaser, and Parent were named as defendants in an alleged class action lawsuit brought by a purported Company stockholder challenging the proposed transaction, which was filed in the Court of Chancery of the State of Delaware, and captioned George Gowan v. Vitesse Semiconductor Corp. et al., Case Number 10841 (the “Gowan Action”). The Gowan Action purports to be brought individually and as a class action on behalf of the Company’s stockholders and generally alleges that, among other things, (i) each member of the Company Board breached his fiduciary duties in connection with the transactions contemplated by the Merger Agreement, including by agreeing to unreasonable deal protection measures, (ii) the Company, Purchaser and Parent aided and abetted those breaches, and (iii) the proposed compensation payable to plaintiff and the class in the transactions contemplated by the Merger Agreement is unfair and inadequate. The Gowan Action seeks, among other relief, to enjoin defendants from consummating the transactions contemplated by the Merger Agreement, rescission and rescissory damages to the extent the transactions are consummated, damages and attorneys’ fees and costs.

On March 30, 2015, members of the Company Board, Purchaser, and Parent were named as defendants in an alleged class action lawsuit brought by a purported Company stockholder challenging the proposed transaction, which was filed in the Court of Chancery of the State of Delaware, and captioned Bernard McGoey v. Christopher Gardner et al., Case Number 10853 (the “McGoey Action”). The McGoey Action purports to be brought individually and as a class action on behalf of the Company’s stockholders and generally alleges that, among other things, (i) each member of the Company Board breached his fiduciary duties in connection with the transactions contemplated by the Merger Agreement, (ii) Purchaser and Parent aided and abetted those breaches, and (iii) the proposed compensation payable to plaintiff and the class in the transactions contemplated by the Merger Agreement is unfair and inadequate. The McGoey Action seeks, among other relief, to enjoin defendants from consummating the transactions contemplated by the Merger Agreement, rescission and rescissory damages to the extent the transactions are consummated, damages and attorneys’ fees and costs.

On April 2, 2015, the Company, members of the Company Board, Purchaser, and Parent were named as defendants in an alleged class action lawsuit brought by a purported Company stockholder challenging the proposed transaction, which was filed in the Court of Chancery of the State of Delaware, and captioned Patricia Mroz v. Vitesse Semiconductor et al., Case Number 10867 (the “Mroz Action”). The Mroz Action purports to be brought individually and as a class action on behalf of the Company’s stockholders and generally alleges that, among other things, (i) each member of the Company Board breached his fiduciary duties in connection with the transactions contemplated by the Merger Agreement, (ii) the Company and Parent aided and abetted those breaches, and (iii) the proposed compensation payable to plaintiff and the class in the transactions contemplated by the Merger Agreement is unfair and inadequate. The Mroz Action seeks, among other relief, to enjoin defendants from consummating the transactions contemplated by the Merger Agreement, rescission and rescissory damages to the extent the transactions are consummated, damages and attorneys’ fees and costs.

On April 7, 2015, the Company, members of the Company Board, Purchaser, and Parent were named as defendants in an alleged class action lawsuit brought by a purported Company stockholder challenging the proposed transaction, which was filed in the Court of Chancery of the State of Delaware, and captioned Debbie Koenig v. Vitesse Semiconductor et al., Case Number 10881 (the “Koenig Action”). The Koenig Action purports to be brought individually and as a class action on behalf of the Company’s stockholders and generally alleges that, among other things, (i) each member of the Company Board breached his fiduciary duties in connection with the transactions contemplated by the Merger Agreement, (ii) Purchaser and Parent aided and abetted those breaches, and (iii) the proposed compensation payable to plaintiff and the class in the transactions contemplated by the Merger Agreement is unfair and inadequate. The Koenig Action seeks, among other relief, to enjoin defendants from consummating the transactions contemplated by the Merger Agreement, rescission and rescissory damages to the extent the transactions are consummated, damages and attorneys’ fees and costs.

On April 8, 2015, members of the Company Board, Purchaser, and Parent were named as defendants in an alleged class action lawsuit brought by a purported Company stockholder challenging the proposed transaction, which was filed in the Court of Chancery of the State of Delaware, and captioned Mark Durbin v. Christopher Gardner et al., Case Number 10891 (the “Durbin Action”). The Durbin Action purports to be brought individually and as a class action on behalf of the Company’s stockholders and generally alleges that, among other things, (i) each member of the Company Board breached his fiduciary duties in connection with the transactions contemplated by the Merger Agreement, including by making inadequate and misleading disclosures to the Company stockholders relating to the Offer and the Merger, (ii) Purchaser and Parent aided and abetted those breaches, and (iii) the proposed compensation payable to plaintiff and the class in the transactions contemplated by the Merger Agreement is unfair and inadequate in light of the Company’s prospects. The Durbin Action seeks, among other relief, to enjoin defendants from consummating the transactions contemplated by the Merger Agreement, rescission and rescissory damages to the extent the transactions are consummated, damages and attorneys’ fees and costs.

On April 10, 2015, the Company, members of the Company Board, Purchaser, and Parent were named as defendants in an alleged class action lawsuit brought by a purported Company stockholder challenging the proposed transaction, which was filed in the Court of Chancery of the State of Delaware, and captioned Merrill Davidoff v. Vitesse Semiconductor et al., Case Number 10901 (the “Davidoff Action” and, collectively with the Mattox Action, the Gowan Action, the McGoey Action, the Mroz Action, the Koenig Action and the Durbin Action, the “Lawsuits”). The Davidoff Action purports to be brought individually and as a class action on behalf of the Company’s stockholders and generally alleges that, among other things, (i) each member of the Company Board breached his fiduciary duties in connection with the transactions contemplated by the Merger Agreement, including by making inadequate and misleading disclosures to the Company stockholders relating to the Offer and the Merger, (ii) the Company, Purchaser and Parent aided and abetted those breaches, and (iii) the proposed compensation payable to plaintiff and the class in the transactions contemplated by the Merger Agreement is unfair and inadequate. The Davidoff Action seeks, among other relief, to enjoin defendants from consummating the transactions contemplated by the Merger Agreement, rescission and rescissory damages to the extent the transactions are consummated, damages and attorneys’ fees and costs.

Parent believes that the claims asserted in the Lawsuits are without merit and intends to defend its position. However, a negative outcome in any Lawsuit could have a material adverse effect on the Parent if it results in preliminary or permanent injunctive relief or rescission of the Merger Agreement. In addition, although the Company has directors and officers liability insurance, the Company anticipates that it will incur significant expense within its self-insured retention under that insurance. Parent is not currently able to predict the outcome of any of the Lawsuits with any certainty. Additional lawsuits arising out of or relating to the Merger Agreement or the Transaction may be filed in the future. If additional similar complaints are filed, absent new or different allegations that are material, the Parent will not necessarily announce such additional filings.

Item 12. Exhibits

Item 12 of the Schedule TO is amended and supplemented by adding the following exhibits:


Exhibit		Exhibit Name

(a)(5)(I)		Complaint filed by Patricia Mroz on behalf of himself and all others similarly situated, on April 2, 2015, in the Court of Chancery of the State of Delaware.

(a)(5)(J)		Complaint filed by Debbie Koenig on behalf of himself and all others similarly situated, on April 7, 2015, in the Court of Chancery of the State of Delaware.

(a)(5)(K)		Complaint filed by Mark Durbin on behalf of himself and all others similarly situated, on April 8, 2015, in the Court of Chancery of the State of Delaware.

(a)(5)(L)		Complaint filed by Merrill Davidoff on behalf of himself and all others similarly situated, on April 10, 2015, in the Court of Chancery of the State of Delaware.

SIGNATURE

After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.


Date: April 13, 2015	LLIU100 Acquisition Corp.

	By:	/s/ JOHN W. HOHENER
	Name:	John W. Hohener
	Title:	Chief Financial Officer and Secretary

Date: April 13, 2015	Microsemi Corporation

	By:	/s/ JOHN W. HOHENER
	Name:	John W. Hohener
	Title:	Executive Vice President,
		Chief Financial Officer, Secretary and Treasurer

EXHIBIT INDEX


Exhibit		Exhibit Name
(a)(1)(A)		Offer to Purchase dated March 31, 2015.+

(a)(1)(B)		Letter of Transmittal (including IRS Form W-9).+

(a)(1)(C)		Notice of Guaranteed Delivery.+

(a)(1)(D)		Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.+

(a)(1)(E)		Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.+

(a)(5)(A)		Joint press release issued by Microsemi Corporation and Vitesse Semiconductor Corporation on March 18, 2015 (incorporated by reference to Exhibit 99.2 of the Current Report on Form 8-K (File No.000-08866) filed by Microsemi Corporation on March 18, 2015).

(a)(5)(B)		Summary Newspaper Advertisement as published in The New York Times on March 31, 2015.+

(a)(5)(C)		Transcript of Microsemi Corporation Analyst/Investor Day, March 18, 2015 (incorporated by reference to Exhibit 99.1 to the Schedule TO-C filed by Microsemi on March 19, 2015).

(a)(5)(D)		Microsemi Corporation Analyst Day presentation, dated March 18, 2015 (incorporated by reference to Exhibit 99.1 of the Current Report on Form 8-K (File No.000-08866) filed by Microsemi Corporation on March 18, 2015).

(a)(5)(E)		Complaint filed by Jefferson Mattox on behalf of himself and all others similarly situated, on March 23, 2015, in the Court of Chancery of the State of Delaware.+

(a)(5)(F)		Complaint filed by George Gowan on behalf of himself and all others similarly situated, on March 27, 2015, in the Court of Chancery of the State of Delaware.+

(a)(5)(G)		Complaint filed by Bernard McGoey on behalf of himself and all others similarly situated, on March 30, 2015, in the Court of Chancery of the State of Delaware.+

(a)(5)(H)		Press Release issued by Microsemi Corporation on April 8, 2015+

(a)(5)(I)		Complaint filed by Patricia Mroz on behalf of himself and all others similarly situated, on April 2, 2015, in the Court of Chancery of the State of Delaware.

(a)(5)(J)		Complaint filed by Debbie Koenig on behalf of himself and all others similarly situated, on April 7, 2015, in the Court of Chancery of the State of Delaware.

(a)(5)(K)		Complaint filed by Mark Durbin on behalf of himself and all others similarly situated, on April 8, 2015, in the Court of Chancery of the State of Delaware.

(a)(5)(L)		Complaint filed by Merrill Davidoff on behalf of himself and all others similarly situated, on April 10, 2015, in the Court of Chancery of the State of Delaware.

(b)(1)		Commitment Letter, dated March 17, 2015, with Bank of America, N.A. and Merrill Lynch, Pierce, Fenner & Smith Incorporated (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K (File No.000-08866) filed by Microsemi Corporation on March 18, 2015).

(b)(2)		Amendment No. 6 to Credit Agreement, dated as of March 31, 2015, by and among Microsemi Corporation, Bank of America, N.A., as administrative agent and collateral agent, the other agents party thereto and the lenders referred to therein (incorporated herein by reference to Exhibit 10.1 of the Current Report on Form 8-K (File No. 000-08866) filed by Microsemi Corporation on April 1, 2015).



(d)(1)		Agreement and Plan of Merger, by and among Microsemi Corporation, LLIU100 Acquisition Corp. and Vitesse Semiconductor Corporation, dated March 17, 2015 (incorporated by reference to Exhibit 2.1 of the Current Report on Form 8-K (File No.000-08866) filed by Microsemi Corporation on March 18, 2015).*

(d)(2)		Tender and Support Agreement, dated March 17, 2015, by and among Microsemi Corporation and certain stockholders of Vitesse Semiconductor Corporation listed on Annex I thereto (incorporated by reference to Exhibit 10.2 of the Current Report on Form 8-K (File No.000-08866) filed by Microsemi Corporation on March 18, 2015).

(d)(3)		Confidentiality Agreement between Microsemi Corporation and Vitesse Semiconductor Corporation, dated March 13, 2013.+

(d)(4)		Amendment to Confidentiality Agreement between Microsemi Corporation and Vitesse Semiconductor Corporation, dated February 4, 2015.+

(d)(5)		Letter Agreement, dated February 23, 2015 between Microsemi Corporation and Vitesse Semiconductor Corporation.+

(d)(6)		Letter Agreement, dated March 11, 2015 between Microsemi Corporation and Vitesse Semiconductor Corporation.+

(g)		Not applicable.

(h)		Not applicable.

*Certain schedules have been omitted and Microsemi Corporation agrees to furnish supplementally to the Securities and Exchange Commission a copy of any omitted schedules upon request.

+ Previously filed.

Exhibit (a)(5)(I)

EFiled: Apr 02 2015 10:42AM EDT

Transaction ID 57010169

Case No. 10867-

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE


PATRICIA MROZ, On Behalf of	)
Herself and All Others Similarly	)
Situated,	)
	)
Plaintiff,	)
	)
v.	)	Civil Action No.
	)
VITESSE SEMICONDUCTOR	)
CORPORATION, CHRISTOPHER R.	)
GARDNER, EDWARD ROGAS, JR.,	)
MATTHEW B. FREY, STEVEN P.	)
HANSON, JAMES H. HUGAR, SCOT	)
B. JARVIS, WILLIAM C. MARTIN,	)
KENNETH H. TRAUB, MICROSEMI	)
CORPORATION, and LLIU100	)
ACQUISITION CORP.,	)
	)
Defendants.	)

VERIFIED CLASS ACTION COMPLAINT

Plaintiff, by her undersigned attorneys, for this Verified Class Action Complaint against defendants, alleges upon personal knowledge with respect to herself, and upon information and belief based upon, inter alia, the investigation of counsel as to all other allegations herein, as follows:

NATURE OF THE ACTION

1. This is a class action brought on behalf of the public stockholders of Vitesse Semiconductor Corporation (“Vitesse” or the “Company”) against Vitesse and its Board of Directors (the “Board” or the “Individual Defendants”), to enjoin

a proposed transaction announced on March 18, 2015 (the “Proposed Transaction”), pursuant to which Vitesse will be acquired by Microsemi Corporation (“Parent”), and Parent’s wholly-owned subsidiary, LLIU100 Acquisition Corp. (“Purchaser” and together with Parent, “Microsemi”).

2. On March 17, 2015, the Board caused Vitesse to enter into an agreement and plan of merger (the “Merger Agreement”). Pursuant to the terms of the Merger Agreement, Purchaser will commence a tender offer (the “Tender Offer”) to purchase all of the outstanding shares of Vitesse’s common stock for only $5.28 per share in cash. Following the successful completion of the Tender Offer, Purchaser will be merged with and into the Company, with the Company surviving as a wholly-owned subsidiary of Parent.

3. The Proposed Transaction is the product of a flawed process and deprives Vitesse’s public stockholders of the ability to participate in the Company’s long-term prospects. Furthermore, in approving the Merger Agreement, the Individual Defendants breached their fiduciary duties to plaintiff and the Class (defined herein). Moreover, as alleged herein, Vitesse and Microsemi aided and abetted the Individual Defendants’ breaches of fiduciary duties.

4. Plaintiff seeks enjoinment of the Proposed Transaction or, alternatively, rescission of the Proposed Transaction in the event defendants are able to consummate it.

PARTIES

5. Plaintiff is, and has been continuously throughout all times relevant hereto, the owner of Vitesse common stock.

6. Defendant Vitesse is a Delaware corporation and maintains its principal executive offices at 4721 Calle Carga, Camarillo, California 93012. The Company is a fabless supplier of high-performance integrated circuits, application software and integrated turnkey systems solutions used primarily in Carrier, Enterprise and industrial Internet of Things network applications. Vitesse’s common stock is traded on the NASDAQ Global Market under the ticker symbol “VTSS.”

7. Defendant Christopher R. Gardner (“Gardner”) has served as a director of Vitesse since October 2006. Gardner has served as the Company’s Chief Executive Officer (“CEO”) since May 2006.

8. Defendant Edward Rogas, Jr. (“Rogas”) has served as a director and Chairman of the Board of Vitesse since 2006. Rogas is a member of the Audit Committee and the Nominating and Governance Committee.

9. Defendant Matthew B. Frey (“Frey”) has served as a director of Vitesse since March 2013. Frey is a member of the Nominating and Governance Committee.

10. Defendant Steven P. Hanson (“Hanson”) has served as a director of Vitesse since August 2007. Hanson is Chair of the Nominating and Governance Committee.

11. Defendant James H. Hugar (“Hugar”) has served as a director of Vitesse since October 2009. Hugar is Chair of the Audit Committee and is a member of the Compensation Committee.

12. Defendant Scot P. Jarvis (“Jarvis”) has served as a director of Vitesse since May 2012. Jarvis is Chair of the Compensation Committee and is a member of the Audit Committee.

13. Defendant William C. Martin (“Martin”) has served as a director of Vitesse since August 2014. Martin is Chair of the Nominating and Governance Committee.

14. Defendant Kenneth H. Traub (“Traub”) has served as a director of Vitesse since March 2013. Traub is a member of the Compensation Committee.

15. The defendants identified in paragraphs seven through fourteen are collectively referred to herein as the “Individual Defendants.” By virtue of their positions as directors and/or officers of Vitesse, the Individual Defendants are in a fiduciary relationship with plaintiff and the other public stockholders of Vitesse.

16. Each of the Individual Defendants at all relevant times had the power to control and direct Vitesse to engage in the misconduct alleged herein. The Individual Defendants’ fiduciary obligations required them to act in the best interest of plaintiff and all Vitesse stockholders.

17. Each of the Individual Defendants owes fiduciary duties of loyalty, good faith, due care, and full and fair disclosure to plaintiff and the other members of the Class. The Individual Defendants are acting in concert with one another in violating their fiduciary duties as alleged herein, and, specifically, in connection with the Proposed Transaction.

18. The Company’s public stockholders must receive the maximum value for their shares through the Proposed Transaction. Plaintiff alleges herein that the Individual Defendants, separately and together, in connection with the Proposed Transaction, violated, and are continuing to violate, the fiduciary duties they owe to plaintiff and the Company’s other public stockholders, due to the fact that they have engaged in all or part of the unlawful acts, plans, schemes, or transactions complained of herein.

19. Defendant Parent is a Delaware corporation with its corporate headquarters located at One Enterprise, Aliso Viejo, California, 92656. Parent is a leading designer, manufacturer, and marketer of high-performance analog and mixed-signal semiconductor solutions differentiated by power, security, reliability and performance. Parent’s common stock is traded on the NASDAQ Global Select Market under the ticker symbol “MSCC.”

20. Defendant Purchaser is a Delaware corporation and a wholly-owned subsidiary of Parent.

CLASS ACTION ALLEGATIONS

21. Plaintiff brings this action as a class action, pursuant to Court of Chancery Rule 23, on behalf of herself and the other public stockholders of Vitesse (the “Class”). Excluded from the Class are defendants herein and any person, firm, trust, corporation, or other entity related to or affiliated with any defendant.

22. This action is properly maintainable as a class action.

23. The Class is so numerous that joinder of all members is impracticable. As of March 13, 2015, there were approximately 69,210,370 shares of Vitesse common stock outstanding, held by hundreds, if not thousands, of individuals and entities scattered throughout the country.

24. Questions of law and fact are common to the Class, including, among others: (i) whether defendants have breached their fiduciary duties owed to plaintiff and the Class; and (ii) whether defendants will irreparably harm plaintiff and the other members of the Class if defendants’ conduct complained of herein continues.

25. Plaintiff is committed to prosecuting this action and has retained competent counsel experienced in litigation of this nature. Plaintiff’s claims are typical of the claims of the other members of the Class and plaintiff has the same interests as the other members of the Class. Accordingly, plaintiff is an adequate representative of the Class and will fairly and adequately protect the interests of the Class.

26. The prosecution of separate actions by individual members of the Class would create the risk of inconsistent or varying adjudications that would establish incompatible standards of conduct for defendants, or adjudications that would, as a practical matter, be dispositive of the interests of individual members of the Class who are not parties to the adjudications or would substantially impair or impede those non-party Class members’ ability to protect their interests.

27. Defendants have acted, or refused to act, on grounds generally applicable to the Class as a whole, and are causing injury to the entire Class. Therefore, final injunctive relief on behalf of the Class is appropriate.

SUBSTANTIVE ALLEGATIONS

Background of the Company

28. Vitesse is a leading supplier of high-performance integrated circuits (“ICs”), associated application and protocol software, and integrated turnkey systems solutions used in Carrier, Enterprise and Industrial Internet of Things (“IoT”) Ethernet networking applications. With these solutions, the Company enables networking industries to transition from legacy networks to standards-based, ubiquitous ‘Ethernet Everywhere’ networking. For over 30 years, starting from Enterprise networks, revolutionizing Carrier networks, and now penetrating Industrial-IoT networks, Vitesse have been a leading innovator in networking and connectivity IC solutions

29. Vitesse’s customers include original equipment manufacturers (“OEMs”) and original design manufacturers (“ODMs”) in its core Carrier and Enterprise markets, as well as a fast-growing base of customers across an increasingly diversified range of markets defined within Industrial-IoT. In fiscal year 2014, Vitesse had over 500 customers worldwide, nearly 300 of which purchased the Company’s new products. The Company’s customers include leading networking OEMs such as Alcatel-Lucent, Ciena, Cisco Systems, Dell, Ericsson, Fiberhome, Hewlett-Packard, Juniper Networks, Nokia Networks, Samsung, Tellabs, and ZTE; ODMs such as Accton, Delta Networks, Pegatron,

and Rubytech; Industrial networking vendors such as Belden/Hirschmann, General Electric, Kyland, and Moxa; as well as many integrators, contract manufacturers, and sub-contractors in the Industrial Process Control, Smart-Grid Energy Distribution, Transportation, and Factory Automation sectors. Lastly, Vitesse counts leading processor and specialized system-on-a-chip (“SoC”) IC companies as customers of its Gigabit Copper physical layer IC (“Cu PHY”) and Ethernet switch engine Intellectual Property (“IP”) cores.

30. The Company is poised for future growth and success.

31. On December 4, 2014, Vitesse issued a press release wherein it announced its financial results for the quarter and full year ended September 30, 2014. Among other things, the Company reported that total net revenues were $28.7 million, compared to $27.2 million in the third quarter of fiscal year 2014 and $26.9 million in the fourth quarter of fiscal year 2013. In addition, product revenues were $27.0 million, compared to $26.0 million in the third quarter of fiscal year 2014 and $26.5 million in the fourth quarter of fiscal year 2013. Total net revenues for fiscal year 2014 were $108.5 million compared with $103.8 million for fiscal year 2013. And product revenues were $102.8 million, compared with $101.3 million in fiscal year 2013.

32. With respect to the financial results, Individual Defendant Gardner, CEO of the Company, commented:

We are very pleased with the success of Vitesse’s ‘Ethernet Everywhere’ strategy and our execution is increasingly evident as demonstrated by our revenue growth, the upward trend in gross margins, design win success, and now, achieving non-GAAP operating profitability[.] . . . In 2014, design wins for our new products reached record highs. Major wins in Carrier and Enterprise continued accumulating steadily, while those in emerging markets, such as Industrial-IoT and Storage, accelerated dramatically. IoT experienced a 200% increase in design wins in the year, now representing 37% of the total. IoT was also a major contributor to our 130 new customers in the year. We believe this growth in IoT will continue as the need to network all things escalates, expanding our served market by nearly $400 million. This market provides multiple avenues to create substantial revenue growth and literally transform Vitesse. Accordingly, we have updated our reporting structure to breakout our IoT business as a third core market.

To address our growing opportunities, we invested in our development organizations, adding critical industry expertise in hardware and software, and in our marketing and sales organizations, including hiring additional sales representatives and distributors. We also achieved a financial milestone by eliminating the dilution overhang with the repayment of our convertible debentures. While our legacy business has declined over the past several years, our new business is growing rapidly. We are increasingly confident that this growth, combined with strengthening gross margins, the high degree of operating leverage in our business, and our improved balance sheet, will generate significant shareholder value.

(Emphasis added).

33. On February 3, 2015, Vitesse issued a press release wherein it announced its financial results for the first quarter fiscal year 2015, ended December 31, 2014. Among other things, the Company reported that total net revenues were $24.8 million, compared to $28.7 million in the fourth quarter of fiscal year 2014 and $27.1 million in the first quarter of fiscal year 2014. In addition, product revenues were $24.0 million, compared to $27.0 million in the fourth quarter of fiscal year 2014 and $24.9 million in the first quarter of fiscal year 2014.

34. With respect to the financial results, Individual Defendant Gardner commented:

New product revenue continues on a solid trajectory reaching $16.2 million in the quarter, up 82% on a year to year basis. New products now represent 68% of our total product revenue[.] . . . Our customer profile continues to grow and evolve as our position strengthens in new, adjacent markets such as IoT and storage, which are literally reshaping our business and expanding our market opportunity. Our expanded sales team dramatically increased both opportunities and design wins, more than doubling the number of new customers in the pipeline, setting us on pace for another record year. As Ethernet propagates into new markets, our total addressable market will triple from approximately $1 billion today to over $3 billion by 2020.

As anticipated, we saw a meaningful decrease in revenue from our legacy products in the first quarter and expect another smaller decline in the second quarter. These declines will be more than offset by new product revenue growth of 50% to 75% for the full fiscal year. We continue to manage expenses carefully as we move through the transition and remain on target to deliver gross product margins of 60% in fiscal year 2015. All told, the leading indicators of our business are strong and we are well positioned with the technology, products, market position, and customers to capitalize on the exciting growth opportunities we are seeing in the market.

(Emphasis added).

The Inadequate Proposed Transaction and Deal Protection Provisions

35. Despite the Company’s prospects for future growth and success, the Board caused the Company to enter into the Merger Agreement, pursuant to which Vitesse will be acquired by Microsemi for inadequate consideration.

36. To the detriment of the Company’s stockholders, the terms of the Merger Agreement substantially favor Microsemi and are calculated to unreasonably dissuade potential suitors from making competing offers.

37. For example, despite a limited and inadequate go-shop period, the Individual Defendants have all but ensured that another entity will not emerge with a competing proposal by agreeing to a “No Solicitation” provision in Section 7.3 of the Merger Agreement that prohibits the Individual Defendants from soliciting alternative proposals and severely constrains their ability to communicate and negotiate with potential buyers who wish to submit or have submitted unsolicited alternative proposals. Section 7.3(b)(i) of the Merger Agreement states:

Except as permitted by this Section 7.3 and except as may relate to any Excluded Party, the Company shall, and shall cause each Company Subsidiary and each of its and their respective Representatives to (i) on the No-Shop Period Start Date, immediately cease any discussions or negotiations with any Persons that may be ongoing with respect to an Acquisition Proposal, and require such Persons and any other Persons who have made or have indicated an intention to make an Acquisition Proposal to promptly return or destroy any confidential information previously furnished by the Company, any of the Company Subsidiaries or any of their respective Representatives; and (ii) from the No-Shop Period Start Date until the earlier of the Effective Time or the termination of this Agreement in

accordance with the terms hereof, the Company and the Company Subsidiaries shall not, nor shall they authorize or knowingly permit any of their respective Representatives to, directly or indirectly (i) solicit, initiate, knowingly encourage or knowingly facilitate any Acquisition Proposal or the making thereof to the Company or its stockholders; (ii) enter into, continue or otherwise participate in any discussions or negotiations regarding, or furnish any non-public information to, or otherwise cooperate in any way with, any person (other than Parent, Purchaser and their Representatives) with respect to any Acquisition Proposal; (iii) waive, terminate, modify or fail to enforce any provision of any contractual “standstill,” confidentiality or similar obligation of any person other than Parent or its affiliates (other than provisions in such obligations customarily referred to as “don’t ask” provisions); or (iv) take any action to render any provision of any “fair price,” “moratorium,” “control share acquisition,” “business combination” or other similar anti-takeover statute (including Section 203 of the DCGL) or any restrictive provision of any applicable anti-takeover provision in the Company’s organizational documents, in each case inapplicable to any person (other than Parent, Purchaser or any of their affiliates) or any Acquisition Proposal (and to the extent permitted thereunder, the Company shall promptly take all steps necessary to terminate any waiver that may have been heretofore granted to any such person or Acquisition Proposal under any such provisions). Any breach of the foregoing provisions of this Section 7.3 by any of the Company Subsidiaries or the Company’s or the Company Subsidiaries’ Representatives shall be deemed to be a breach by the Company.

38. Further, pursuant to Section 7.3(d) of the Merger Agreement, the Company must advise Microsemi, within twenty-four hours, of any proposals or inquiries received from other parties, including, inter alia, the material terms and conditions of the proposal and the identity of the party making the proposal. Section 7.3(d) of the Merger Agreement states:

(d) The Company shall promptly (and in any event within twenty-four (24) hours of learning of the relevant information) advise Parent orally and in writing of the receipt of any Acquisition Proposal (including for the avoidance of doubt any request for information or other inquiry which the Company would reasonably expect to lead to an Acquisition Proposal), including the material terms and conditions of such Acquisition Proposal (including any changes thereto) and the identity of the person making such Acquisition Proposal and attaching a copy of any such written Acquisition Proposal, or if such Acquisition Proposal is provided orally to the Company, the Company shall summarize in writing the terms of such Acquisition Proposal (including for the avoidance of doubt any such request or other inquiry). The Company shall keep Parent informed on a prompt basis in all material respects of the status and details (including any material change or proposed change to the terms thereof) of any Acquisition Proposal. The Company shall publicly reaffirm the Company Board Recommendation within ten (10) business days of the commencement of any tender or exchange offer by a Third Party, after receipt of a written request by Parent to provide such reaffirmation, unless a Change in Recommendation is permitted by Section 7.3(c)(iii).

39. Moreover, the Merger Agreement contains a highly restrictive “fiduciary out” provision permitting the Board to withdraw its approval of the Proposed Transaction under extremely limited circumstances, and grants Microsemi a “matching right” with respect to any “Superior Proposal” made to the Company. Section 7.3(b)(ii) of the Merger Agreement provides:

Notwithstanding anything to the contrary herein, if at any time following the No-Shop Period Start Date and prior to the Acceptance Time, in response to an unsolicited bona fide written Acquisition Proposal that the Company Board determines in good faith (after consultation with outside counsel and a financial advisor of nationally recognized reputation) is, or is reasonably likely to lead to, a Superior Proposal, and which Acquisition Proposal the Company Board determines (after consultation with outside legal counsel) did not result from or arise in connection with a breach of this Section 7.3(b) and was made after the date hereof, the Company may, subject to compliance with Section 7.3(d), (x) furnish information

regarding the Company and the Company Subsidiaries to the person making such Acquisition Proposal (and its Representatives) pursuant to a confidentiality agreement (which shall permit the Company to comply with the terms of this Section 7.3(b) and Section 7.3(d)) containing confidentiality and standstill provisions not less restrictive in the aggregate to such person than such provisions of the Confidentiality Agreement are to Parent; provided, that all such information has previously been provided to Parent or is provided to Parent prior to or promptly following the time it is provided to such person, and (y) participate in discussions or negotiations with the person making such Acquisition Proposal (and its Representatives) regarding such Acquisition Proposal, but only if and to the extent that in connection with the foregoing clauses (x) and (y), the Company Board determines in good faith (after consultation with outside legal counsel) that failure to take such action would reasonably be expected to result in a breach by the Company Board of its fiduciary duties under applicable Law, and provided, the Company shall not take any of the actions referred to in the foregoing clauses (x) and (y) unless the Company shall have notified Parent in writing at least two (2) business days prior to taking such action that it intends to take such action and the basis hereunder therefor; provided further, that notwithstanding anything to the contrary contained in Section 7.3(a) or this Section 7.3(b) prior to the Acceptance Time, the Company will in any event be permitted to take any or all of the actions described in clauses (x) and (y) above with respect to any Excluded Party. In addition, notwithstanding the foregoing, prior to the Acceptance Time, the Company may, to the extent the Company Board determines in good faith (after consultation with outside legal counsel) that failure to take such action would reasonably be expected to result in a breach by the Company Board of its fiduciary duties under applicable Law, not enforce any confidentiality, standstill or similar agreement to which the Company or any Company Subsidiary is a party for the sole purpose of allowing the other party to such agreement to submit an Acquisition Proposal, or with respect to another party that has submitted an Acquisition Proposal, solely with respect to such submission, that will constitute, or is reasonably likely to lead to, a Superior Proposal, that did not, in each case, result from a breach by the Company of this Section 7.3(b).

40. Further locking up control of the Company in favor of Microsemi is Section 9.3 of the Merger Agreement, which contains a provision for a “Termination Fee” of up to $13.6 million, or $6.8 million if the Merger Agreement is terminated during the go-shop period, payable by the Company to Microsemi if the Individual Defendants cause the Company to terminate the Merger Agreement pursuant to the lawful exercise of their fiduciary duties.

41. By agreeing to all of the deal protection devices, the Individual Defendants have locked up the Proposed Transaction and have precluded other bidders from making successful competing offers for the Company.

42. Additionally, concurrently with the execution of the Merger Agreement, the directors of the Company and their affiliates, who directly or indirectly own 15,330,639 shares of the Company’s outstanding common stock, representing approximately 22.1% of the shares outstanding as of March 17, 2015, entered into a Tender and Support Agreement with Microsemi (the “Tender and Support Agreement”), which provides, among other things, that such stockholders will tender their Company shares in the Tender Offer.

43. The consideration to be paid to plaintiff and the Class in the Proposed Transaction is unfair and inadequate because, among other things, the intrinsic value of the Company is materially in excess of the amount offered in the Proposed Transaction. For example, according to Yahoo! Finance, at least one analyst has issued a price target for Vitesse stock at $6.00 per share.

44. Accordingly, the Proposed Transaction will deny Class members their right to share proportionately and equitably in the true value of the Company’s valuable and profitable business, and future growth in profits and earnings.

45. As a result, the defendants have breached their fiduciary duties that they owe to the Company’s public stockholders because the stockholders will not receive adequate or fair value for their Vitesse common stock in the Proposed Transaction.

COUNT I

(Breach of Fiduciary Duties against the Individual Defendants)

46. Plaintiff repeats and realleges the preceding allegations as if fully set forth herein.

47. As members of the Company’s Board, the Individual Defendants have fiduciary obligations to: (a) undertake an appropriate evaluation of Vitesse’s net worth as a merger/acquisition candidate; (b) take all appropriate steps to enhance Vitesse’s value and attractiveness as a merger/acquisition candidate; (c) act independently to protect the interests of the Company’s public stockholders; (d) adequately ensure that no conflicts of interest exist between the Individual Defendants’ own interests and their fiduciary obligations, and, if such conflicts

exist, to ensure that all conflicts are resolved in the best interests of Vitesse’s public stockholders; (e) actively evaluate the Proposed Transaction and engage in a meaningful auction with third parties in an attempt to obtain the best value on any sale of Vitesse; and (f) disclose all material information to the Company’s stockholders.

48. The Individual Defendants have breached their fiduciary duties to plaintiff and the Class.

49. As alleged herein, the Individual Defendants have initiated a process to sell Vitesse that undervalues the Company. In addition, by agreeing to the Proposed Transaction, the Individual Defendants have capped the price of Vitesse at a price that does not adequately reflect the Company’s true value. The Individual Defendants also failed to sufficiently inform themselves of Vitesse’s value, or disregarded the true value of the Company. Furthermore, any alternate acquiror will be faced with engaging in discussions with a management team and Board that are committed to the Proposed Transaction.

50. As such, unless the Individual Defendants’ conduct is enjoined by the Court, they will continue to breach their fiduciary duties to plaintiff and the other members of the Class, and will further a process that inhibits the maximization of stockholder value.

51. Plaintiff and the members of the Class have no adequate remedy at law.

COUNT II

(Aiding and Abetting the Board’s Breaches of Fiduciary Duties

Against Vitesse and Microsemi)

52. Plaintiff repeats and realleges the preceding allegations as if fully set forth herein.

53. Defendants Vitesse and Microsemi knowingly assisted the Individual Defendants’ breaches of fiduciary duties in connection with the Proposed Transaction, which, without such aid, would not have occurred. In connection with discussions regarding the Proposed Transaction, Vitesse provided, and Microsemi obtained, sensitive non-public information concerning Vitesse and thus had unfair advantages that are enabling it to pursue the Proposed Transaction, which offers unfair and inadequate consideration.

54. As a result of this conduct, plaintiff and the other members of the Class have been and will be damaged in that they have been and will be prevented from obtaining fair consideration for their Vitesse shares.

55. Plaintiff and the members of the Class have no adequate remedy at law.

PRAYER FOR RELIEF

WHEREFORE, plaintiff prays for judgment and relief as follows:

A. Ordering that this action may be maintained as a class action and certifying plaintiff as the Class representative and plaintiff’s counsel as Class counsel;

B. Preliminarily and permanently enjoining defendants and all persons acting in concert with them from proceeding with, consummating, or closing the Proposed Transaction;

C. In the event defendants consummate the Proposed Transaction, rescinding it and setting it aside or awarding rescissory damages to plaintiff and the Class;

D. Directing defendants to account to plaintiff and the Class for their damages sustained because of the wrongs complained of herein;

E. Awarding plaintiff the costs of this action, including reasonable allowance for plaintiff’s attorneys’ and experts’ fees; and

F. Granting such other and further relief as this Court may deem just and proper.


Dated: April 2, 2015		RIGRODSKY & LONG, P.A.

	By:	/s/ Brian D. Long
		Seth D. Rigrodsky (#3147)
		Brian D. Long (#4347)
		Gina M. Serra (#5387)
		Jeremy J. Riley (#5791)
		2 Righter Parkway, Suite 120
		Wilmington, DE 19803
		(302)295-5310

		Attorneys for Plaintiff

Exhibit (a)(5)(J)

EFiled: Apr 07 2015 01:10PM EDT

Transaction ID 57036690

Case No. 10881-

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE


DEBBIE KOENIG, on behalf of herself	)
and all others similarly situated,	)
	)
Plaintiff,	)
	)	Civil Action No.
vs.	)
	)
VITESSE SEMICONDUCTOR	)
CORPORATION, MICROSEMI	)
CORPORATION, LLIU100	)
ACQUSITION CORP., CHRISTOPHER	)
GARDNER, EDWARD ROGAS JR.,	)
MATTHEW B. FREY, STEVE P.	)
HANSON, JAMES HUGAR, SCOT	)
JARVIS, WILLIAM C. MARTIN,	)
KENNETH H. TRAUB,	)
	)
Defendants.	)

VERIFIED CLASS ACTION COMPLAINT

Plaintiff Debbie Koenig (“Plaintiff”), by her attorneys, on behalf of herself and those similarly situated, files this action against the defendants and alleges upon information and belief, except for those allegations that pertain to her, which are alleged upon personal knowledge, as follows:

1. Plaintiff bring this shareholder class action on behalf of herself and all other public shareholders of Vitesse Semiconductor Corporation (“Vitesse” or the “Company”) against Vitesse’s Board of Directors (the “Board” or the “Individual Defendants”), Microsemi Corporation (“Microsemi”), and LLIU100 Acquisition Corp. (“Merger Sub”) (collectively referred to as “Defendants”), challenging an

all-cash transaction by which Microsemi will acquire each issued and outstanding share of Vitesse for $5.28 per share in cash (the “Proposed Transaction”). The total value of the transaction is approximately $389 million.

2. On March 18, 2015, the Company filed a definitive Agreement and Plan of Merger with the U.S. Securities and Exchange Commission (the “Merger Agreement”) detailing the terms of the Transaction. Per the Merger Agreement, the Proposed Transaction is structured as a tender offer. Microsemi has received support agreements from Vitesse stockholders holding approximately 22 percent of Vitesse’s outstanding common shares. Under the terms of the support agreements, these stockholders have agreed to tender their shares in the tender offer.

3. If the Proposed Transaction is approved, the Individual Defendants will have breached their fiduciary duties of loyalty and due care by, inter alia, agreeing to sell Vitesse without first taking steps to ensure that Plaintiff and Class members (defined below), who are the minority shareholders of the Company, would obtain adequate and fair consideration under the circumstances. Moreover, as alleged further herein, the Microsemi and the Merger Sub aided and abetted the Individual Defendants’ breaches of fiduciary duty.

4. Accordingly, this action seeks to enjoin the Proposed Transaction and compel the Individual Defendants to properly exercise their fiduciary duties to Vitesse’s shareholders.

5. Plaintiff alleges that she, along with all other public shareholders of Vitesse common stock, are entitled to enjoin the Proposed Transaction or, alternatively, to recover damages in the event that the Proposed Transaction is consummated. The consideration offered to Vitesse shareholders is inadequate.

THE PARTIES

6. Plaintiff is and has been a shareholder of Vitesse during all relevant times hereto.

7. Defendant Vitesse is incorporated in Delaware with headquarters located at 4721 Calle Carga, Camarillo, CA 93012. The Company’s common stock is traded on the Nasdaq under the symbol “VTSS.”

8. Defendant Chris Gardner (“Gardner”) has served as a director of the Company and as CEO since 2006.

9. Defendant Edward Rogas, Jr. has been a director of the Company and Chairman of the Board at all relevant times.

10. Defendant Matthew B. Frey has been a director of the Company at all relevant times.

11. Defendant Steve P. Hanson has been a director of the Company at all relevant times.

12. Defendant James Hugar has been a director of the Company at all relevant times.

13. Defendant Scot Jarvis has been a director of the Company at all relevant times.

14. Defendant William C. Martin has been a director of the Company at all relevant times.

15. Defendant Kenneth H. Traub has been a director of the Company at all relevant times.

16. Individual Defendants in paragraphs 7 – 15 are, and at all times relevant hereto have been, directors of Vitesse.

17. The Defendants named in paragraphs 7 - 15 are referred to herein as “Individual Defendants” or “Director Defendants.”

18. The Director Defendants owe fiduciary duties including good faith, loyalty, fair dealing, due care and candor to Vitesse and its shareholders.

19. The Director Defendants, by reason of their corporate directorships and/or executive positions, are fiduciaries to and for the Company’s stockholders, which fiduciary relationship required them to exercise their best judgment, and to act in a prudent manner and in the best interests of the company’s stockholders.

20. Each Director Defendant herein is sued individually, as a conspirator and aider and abettor, as well as in their capacity as an officer and/or director of the Company, and the liability of each arises from the fact that he has engaged in all or part of the unlawful acts, plans, schemes, or transactions complained of herein.

21. Defendant Microsemi is headquartered Aliso Viejo, CA. Microsemi offers a comprehensive portfolio of semiconductor and system solutions for communications, defense & security, aerospace and industrial markets. Microsemi’s common stock is traded on the Nasdaq under the symbol, “MSCC.”

SUBSTANTIVE ALLEGATIONS

Vitesse Background

22. Vitesse designs, develops, and markets various semiconductor products for carrier and enterprise networking applications worldwide. The Company provides carrier Ethernet switch engines, including mobile access equipment, such as base stations, small cells, fiber and microwave wireless backhaul products, and Ethernet access devices for delivering business services; and enterprise Ethernet switches for cloud access, desktop, workgroup, and LAN infrastructure to migrate to gigabit Ethernet speeds. It also offers gigabit Ethernet copper and dual-media transceivers, including single, quad, and octal devices that allow transmission of 10/100/1000 BASE-T data over category 5 copper cable and fiber optic cabling for use in personal computing, home electronics, and LAN applications; and SynchroPHY gigabit Ethernet copper and dual-media transceivers.

23. Carrier Ethernet is the de facto networking communications protocol in wide area networks (WAN), now supported by over 1000 network operators globally. Its ubiquity is only expected to grow, with bandwidth for global Ethernet business services projected to exceed 75% of total global business bandwidth by 2017, according to Vertical Systems Group. Underscoring the Company’s commitment to advance Ethernet networking everywhere, Vitesse, a leading provider of IC solutions for Carrier, Enterprise and Internet of Things (IoT) networks worldwide, announced in November 2014 its intent to fully credential its global team of field applications engineers as MEF Carrier Ethernet Certified Professionals (MEF-CECPs) by the end of 2014.

24. The MEF-CECP is the industry’s first vendor-neutral technical certification program developed by a renowned team of Carrier Ethernet subject matter experts and industry leaders. Professionals must pass a rigorous certification process to demonstrate technical prowess and Carrier Ethernet expertise. “This technical certification is MEF’s fastest growing program, with nearly a ten-fold increase in the number of MEF-CECPs since 2012, reflecting Carrier Ethernet’s record growth,” said Nan Chen, president of the MEF. “Certification of all their field applications team is clear evidence of Vitesse’s commitment to back the Carrier Ethernet products that they bring to market with the most qualified professionals in the industry.”

25. “With nearly 90% of our field applications engineering team having already earned the MEF-CECP designation, this brings another layer of value-added service to our customers in existing and emerging markets,” said Uday Mudoi, vice president of product marketing at Vitesse. “Vitesse is proud to provide a turnkey IC and software solution that enables our customers to achieve MEF CE 2.0 equipment certification in record time. Beyond the mobile backhaul and business service delivery platforms that require CE 2.0 today, we see the same requirements emerging as critical must-haves in IoT applications. Ethernet networking is going virtually everywhere.”

26. On December 4, 2014, Vitesse announced Q4 and fiscal 2014 year-end results, “We are very pleased with the success of Vitesse’s ‘Ethernet Everywhere’ strategy and our execution is increasingly evident as demonstrated by our revenue growth, the upward trend in gross margins, design win success, and now, achieving non-GAAP operating profitability,” said Chris Gardner, CEO of Vitesse. “In 2014, design wins for our new products reached record highs. Major wins in Carrier and Enterprise continued accumulating steadily, while those in emerging markets, such as Industrial-IoT and Storage, accelerated dramatically. IoT experienced a 200% increase in design wins in the year, now representing 37% of the total. IoT was also a major contributor to our 130 new customers in the year. We believe this growth in IoT will continue as the need to network all things escalates, expanding our served market by nearly $400 million. This market provides multiple avenues to create substantial revenue growth and literally transform Vitesse. Accordingly, we have updated our reporting structure to breakout our IoT business as a third core market.”

27. Vitesse’s is growing at a “rapid” pace and according to defendant Gardner, the opportunity to grow even more remains abundant. “To address our growing opportunities, we invested in our development organizations, adding critical industry expertise in hardware and software, and in our marketing and sales organizations, including hiring additional sales representatives and distributors. We also achieved a financial milestone by eliminating the dilution overhang with the repayment of our convertible debentures. While our legacy business has declined over the past several years, our new business is growing rapidly. We are increasingly confident that this growth, combined with strengthening gross margins, the high degree of operating leverage in our business, and our improved balance sheet, will generate significant shareholder value.”

28. Total net revenues for fiscal year 2014 were $108.5 million compared with $103.8 million for fiscal year 2013. Product margins were 56.7% in fiscal year 2014, compared to 53.9% in the prior year. Total gross margins were 59.0%, compared to 54.9% in the prior year.

29. On February 3, 2015, the Company announced Q1 2015 financial results. “New product revenue continues on a solid trajectory reaching $16.2 million in the quarter, up 82% on a year to year basis. New products now represent

68% of our total product revenue,” said Chris Gardner, CEO of Vitesse. “Our customer profile continues to grow and evolve as our position strengthens in new, adjacent markets such as IoT and storage, which are literally reshaping our business and expanding our market opportunity. Our expanded sales team dramatically increased both opportunities and design wins, more than doubling the number of new customers in the pipeline, setting us on pace for another record year. As Ethernet propagates into new markets, our total addressable market will triple from approximately $1 billion today to over $3 billion by 2020.”

30. Revenue for the first quarter was $24.8 MM, a small decrease from Q1 2014. However, according to Gardner, “These declines will be more than offset by new product revenue growth of 50% to 75% for the full fiscal year. We continue to manage expenses carefully as we move through the transition and remain on target to deliver gross product margins of 60% in fiscal year 2015. All told, the leading indicators of our business are strong and we are well positioned with the technology, products, market position, and customers to capitalize on the exciting growth opportunities we are seeing in the market.”

The Proposed Transaction

31. On March 18, 2015, Vitesse announced the Proposed Transaction.

The press release states in relevant part as follows:

ALISO VIEJO, Calif. and CAMARILLO, Calif.—March 18, 2015—Microsemi Corporation (Nasdaq:MSCC), a leading provider of semiconductor solutions differentiated by power, security, reliability and performance, and Vitesse Semiconductor Corporation (Nasdaq:VTSS), jointly announced today that Microsemi has entered into a definitive agreement to acquire Vitesse for $5.28 per share through a cash tender offer, representing a premium of 32 percent based on the average closing price of Vitesse’s shares of common stock during the 30 trading days ended March 17, 2015. The board of directors of Vitesse unanimously recommends that Vitesse’s stockholders tender their shares in the tender offer. The total transaction value is approximately $389 million.

Headquartered in Camarillo, California, Vitesse designs a diverse portfolio of high-performance semiconductors, application software, and integrated turnkey systems solutions for carrier, enterprise and Internet of Things (IoT) networks worldwide. Vitesse’s products enable the fastest-growing network infrastructure markets including mobile access/IP edge, enterprise cloud access, and industrial-IoT networking.

“This acquisition is further evidence of Microsemi’s continuing commitment to grow as a communications semiconductor company,” stated James J. Peterson, Microsemi chairman and CEO. “Vitesse’s highly complementary technology suite will expand our product offering and accelerate growth with differentiated technology in emerging markets, while benefitting from the increased scale, consolidated infrastructure and cost savings of the combined entity.”

“The proposed acquisition of Vitesse by Microsemi will create a powerful combination,” said Chris Gardner, Vitesse’s chief executive officer. “I believe Microsemi will be able to leverage Vitesse’s Ethernet technology and capabilities further into the communications market and has the scale to implement the adoption of our industrial IoT strategy.”

Microsemi expects significant synergies from this transaction and expects to see immediate accretion in the first full quarter of completion. Based on current assumptions, Microsemi expects the acquisition to be $0.16 to $0.20 per share accretive in its first full fiscal year ending September 30, 2016.

As of this date, Microsemi remains comfortable with its Jan. 22, 2015 non-GAAP guidance for its second fiscal quarter of 2015, ending March 29, 2015. Microsemi currently intends to announce it second fiscal quarter results on April 23, 2015. Further details will be forthcoming.

Tender Offer and Closing

Under the terms of the definitive acquisition agreement, Microsemi will commence a cash tender offer to acquire Vitesse’s outstanding shares of common stock at $5.28 per share, net to each holder in cash. Upon satisfaction of the conditions to the tender offer and after such time as all shares tendered in the tender offer are accepted for payment, the agreement provides for the parties to effect, as promptly as practicable, a merger which would result in all shares not tendered in the tender offer being converted into the right to receive $5.28 per share in cash. The tender offer is subject to customary conditions, including the tender of at least a majority of the outstanding shares of Vitesse’s common stock on a modified fully diluted basis and certain regulatory approvals, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, and is expected to close in Microsemi’s fiscal third quarter, ending June 28, 2015. No approval of the stockholders of Microsemi is required in connection with the proposed transaction. Terms of the agreement were unanimously approved by the boards of directors of both Microsemi and Vitesse. Microsemi has received support agreements from Vitesse stockholders holding approximately 22 percent of Vitesse’s outstanding common shares. Under the terms of the support agreements, these stockholders have agreed to tender their shares in the tender offer.

potential superior proposal. Deutsche Bank will assist Vitesse with its go shop process. There are no guarantees that this process will result in a superior proposal. The merger agreement provides Microsemi with a customary right to match a superior proposal. The agreement also provides for certain break-up fees payable to Microsemi in connection with the termination of the agreement in certain circumstances.

BofA Merrill Lynch is providing customary committed debt financing for the acquisition. BofA Merrill Lynch and RBC Capital Markets acted as financial advisors, and O’Melveny & Myers LLP is acting as legal adviser to Microsemi. Deutsche Bank and Needham & Company are acting as financial advisors and Stubbs Alderton & Markiles, LLP is acting as legal advisor to Vitesse.

The Inadequate Merger Consideration

32. Significantly, analyst expectations, the Company’s dominant Ethernet market position, extraordinary growth, synergistic value to Microsemi and positive future outlook establish the inadequacy of the merger consideration.

33. Pursuant to the terms of the Merger Agreement, the Transaction values shares of Vitesse at $5.28 per share. Significantly, since the announcement of the Proposed Transaction, shares of Vitesse have soared above and beyond the Merger consideration value. As of this filing, shares of Vitesse are trading at $5.34/share. Ascendiant Capital’s Cody Acree calls the offer “a bit low,” given the deal is expected to be immediately accretive for Microsemi. “The $389 million offer appears a bit low, in our opinion. With that, we would not be surprised if other offers materialize over the next three weeks, specifically given that MSCC

expects the deal to be immediately accretive in the first quarter after closing and for the full year, which is indicative of the relatively inexpensive price MSCC is paying for the asset... We have long believed the company presented a significant value proposition as the underlying growth drivers were developing, yet masked by the declining mature products. We believe VTSS’s 3Q was the turning point for the company, with clear line of sight to continued profitability. Although we do see the current acquisition partner as a good fit, we would have expected a moderately higher premium, more in-line with the growth opportunities ahead.”

34. Meanwhile, Stifel’s Tore Svanberg has hiked his Microsemi target by $5 to $40 in response to the Vitesse deal and Microsemi’s analyst day presentations. “[M]anagement reiterated its strategy to maximize profitability, grow its market share in core products, while expanding its [addressable market] through new product initiatives and deeper penetration into their existing customer base,” and this acquisition accomplishes these initiatives.

35. Svanberg adds the Vitesse deal “helps expand [Microsemi’s] silicon/dollar content initiatives, especially in the comms infrastructure space and adds differentiated technology with high barriers to entry.” He sees the purchase making Microsemi’s goal of achieving a 60% gross margin and 30% op. margin in 2016 (compares with 56.2% and 24.4% in calendar Q4) easier to attain.

36. Significantly, of the six (6) analysts covering Vitesse on Yahoo! Finance, at least one of them has set a $6/share price target on Vitesse stock while the “Mean Target” of those analysts is $5.30 per share.

37. As discussed supra, Vitesse has excellent growth prospects. Stated defendant Gardner, “All told, the leading indicators of our business are strong and we are well positioned with the technology, products, market position, and customers to capitalize on the exciting growth opportunities we are seeing in the market.” According to Yahoo! Finance, Vitesse’s revenue growth for this year, 62.5%, and next year, 383.3%, far exceed the industry expected growth rates of 24.4% and 26.9% for those two measuring periods.

38. The synergistic value of Vitesse to Microsemi also commands a larger premium. Per the Merger press release, it is clear that the Proposed Transaction is for the benefit of Microsemi and not Vitesse shareholders. In a statement, Chris Gardner, Vitesse’s CEO said, “I believe Microsemi will be able to leverage Vitesse’s Ethernet technology and capabilities further into the communications market and has the scale to implement the adoption of our industrial IoT strategy.”

39. On the other hand, Tom Hackenberg, principal analyst responsible for MCUs and DSPs at IHS Global Inc., views the deal as a “good fit strategically.” Once merged, Microsemi can take Vitesse’s Ethernet technology to markets “that are much more exclusive and less accessible to the broad telecommunication

competitors,” he explained. Many of these equipment designers rely on only providers with the expertise to provide certified high reliability and long-life products, he explained. “Together they should be able to expand their penetration in this cross-platform market.” Through the acquisition of Vitesse, Microsemi is hoping to update its broader portfolio and strengthen its communications expertise.

40. Concurrently with the execution of the Merger Agreement, the directors of the Company and their affiliates, if applicable, who directly or indirectly own 15,330,639 shares of the Company’s outstanding common stock, representing approximately 22.1% of the shares outstanding as of March 17, 2015, entered into a Tender and Support Agreement with Microsemi and the Merger Sub (the “Tender and Support Agreement”), which provides, among other things, that such stockholders will tender their shares in the Offer and vote their shares in favor of approving the principal terms of the Merger.

41. In addition, it appears as though certain of the Individual Defendants may have been motivated by their own self-interest in agreeing to the Proposed Transaction. For example, pursuant to defendant Gardner’s employment agreement with the Company, he will receive approximately $3.6 million in golden parachute monies upon consummation of the Merger.

42. Accordingly, and in breach of their fiduciary duties, the Board has denied Vitesse’s shareholders the fair and adequate value of their investment by entering into the Proposed Transaction for inadequate consideration.

Preclusive Deal Mechanisms

43. Moreover, the Agreement contains certain provisions that unfairly favor the Microsemi by making an alternative transaction either prohibitively expensive or otherwise impossible. For example, the Agreement contains a termination fee provision that requires Vitesse to pay up to $17,000,000.00 to the Microsemi if the Merger Agreement is terminated under certain circumstances.

44. The termination fee payable under this provision will make the Company that much more expensive to acquire for potential purchasers, while resulting in a corresponding decline in the amount of consideration payable to Vitesse shareholders.

45. Following a brief “go-shop” period, the Agreement also contains a “No Solicitation” provision that restricts Vitesse from considering alternative acquisition proposals by, inter alia, constraining Vitesse’s ability to solicit or communicate with potential acquirers. Specifically, the provision prohibits the Company from soliciting any alternative proposal after the defined time period, but permits the Board to consider a “bona fide written Acquisition Proposal” if it constitutes or is reasonably calculated to lead to a “Superior Proposal” as defined in the Agreement.

46. Moreover, the Agreement further reduces the possibility of a topping offer from an unsolicited purchaser. Here, Defendants agreed to provide the Microsemi information in order to match any other offer, thus providing the Microsemi access to the unsolicited bidder’s financial information and giving the Microsemi the ability to top the superior offer. Thus, a rival bidder is not likely to emerge with the cards stacked so much in favor of the Microsemi.

47. Accordingly, the Company’s true value is compromised by the consideration offered in the Proposed Transaction, and the Proposed Transaction is the product of the Board’s breaches of fiduciary duty, aided and abetted by Microsemi.

THE INDIVIDUAL DEFENDANTS’ FIDUCIARY DUTIES

48. In any situation where the directors of a publicly traded corporation undertake a transaction that will result in either a change in corporate control or a break-up of the corporation’s assets, the directors have an affirmative fiduciary obligation to act in the best interests of the company’s shareholders, including the duty to obtain maximum value under the circumstances. To diligently comply with these duties, the directors may not take any action that:

(a) adversely affects the value provided to the corporation’s shareholders;

(b) will discourage or inhibit alternative offers to purchase control of the corporation or its assets;

(d) will provide the directors, executives or other insiders with preferential treatment at the expense of, or separate from, the public shareholders, and place their own pecuniary interests above those of the interests of the company and its shareholders.

49. In accordance with their duties of loyalty and good faith, the Individual Defendants, as directors and/or officers of Vitesse, are obligated to refrain from;

(a) participating in any transaction where the directors’ or officers’ loyalties are divided;

(b) participating in any transaction where the directors or officers are entitled to receive a personal financial benefit not equally shared by the public shareholders of the corporation; and/or

50. Plaintiff alleges herein that the Individual Defendants, separately and together, in connection with the Proposed Transaction, violated, and are violating, the fiduciary duties they owe to Plaintiff and the other public shareholders of Vitesse, including their duties of loyalty, good faith, candor, and due care. As a result, Plaintiff and Class members will not receive adequate or fair value for their Vitesse common stock in the Proposed Transaction.

CLASS ACTION ALLEGATIONS

51. Plaintiff brings this action individually and as a class action on behalf of all holders of Vitesse common stock who are being and will be harmed by the Defendants’ actions, described herein (the “Class”). Excluded from the Class are Defendants and any person, firm, trust, corporation or other entity related to or affiliated with any Defendant.

52. This action is properly maintainable as a class action because, inter alia:

(a) The Class is so numerous that joinder of all members is impracticable. Vitesse’s stock is publicly traded on the NasdaqGS and there are hundreds of thousands of outstanding shares. Plaintiff believes that there are hundreds if not thousands of holders of such shares. Moreover, the holders of these shares are geographically dispersed throughout the United States;

(b) There are questions of law and fact which are common to the Class including, inter alia: (i) whether the Individual Defendants have breached their fiduciary duties to plaintiff and the Class by agreeing to an acquisition transaction at a price that is inadequate and is not the fair value that could be obtained under the circumstances; (ii) whether Microsemi and the Merger Sub aided and abetted the Individual Defendants’ breaches of fiduciary duty; and (iii) whether the Class is entitled to injunctive relief and/or damages as a result of the wrongful conduct committed by Defendants;

(c) Plaintiff is committed to prosecuting this action and has retained competent counsel experienced in litigation of this nature. The claims of Plaintiff are typical of the claims of the other members of the Class and Plaintiff has the same interests as the other members of the Class. Accordingly, Plaintiff is an adequate representative of the Class and will fairly and adequately protect the interests of the Class;

(d) The prosecution of separate actions by individual members of the Class would create the risk of inconsistent or varying adjudications with respect to individual members of the Class which would establish incompatible standards of conduct for Defendants, or adjudications with respect to individual members of the Class which would, as a practical matter, be dispositive of the interests of the other members not parties to the adjudications or substantially impair or impede their ability to protect their interests; and

(e) Defendants have acted, or refused to act, on grounds generally applicable to, and causing injury to, the Class and, therefore, preliminary and final injunctive relief on behalf of the Class as a whole is appropriate.

FIRST COUNT

Breach of Fiduciary Duty against the Individual Defendants

53. Plaintiff incorporates each and every allegation set forth above as if fully set forth herein.

54. As alleged herein, Defendants have initiated a process to sell Vitesse in a transaction that undervalues the Company. Indeed, financial analysts have set price target for Company shares as high as $6 per share. The Individual Defendants are privy to non-public information concerning the Company that the public stock shareholders are not; thus, there exists a fiduciary duty to protect these shareholders. Defendants have failed to sufficiently inform themselves of Vitesse’s value, or have disregarded the true value of the Company. Furthermore, the Individual Defendants have agreed to onerous deal protection devices that discourage any alternate acquirer from coming forward in the face of the knowledge that Microsemi can block the purchase.

55. As such, unless the Individual Defendants’ conduct is enjoined by the Court, they will continue to breach their fiduciary duties to Plaintiff and the other members of the Class, and will further a process that inhibits the maximization of shareholder value and the disclosure of material information.

56. Plaintiff and the members of the Class have no adequate remedy at law.

SECOND COUNT

Aiding and Abetting the Board’s Breaches of Fiduciary Duty

Against Microsemi and the Merger Sub

57. Plaintiff incorporates each and every allegation set forth above as if fully set forth herein.

58. The Merger Sub and Microsemi knowingly assisted the Individual Defendants’ breaches of fiduciary duty in connection with the Proposed Transaction, which, without such aid, would not have occurred. In connection with discussions regarding the Proposed Transaction, the Merger Sub and Microsemi secured certain deal protection provisions which unfairly inhibit the advancement of alternative proposals. In addition, the Merger Sub and Microsemi obtained sensitive non-public information concerning Vitesse’s operations and thus had the advantage to acquire the Company at a price that is unfair to plaintiff and the Class.

59. As a result of this conduct, Plaintiff and the other members of the Class have been and will be damaged in that they have been and will be prevented from obtaining a fair price for their shares.

60. Plaintiff and the members of the Class have no adequate remedy at law.

WHEREFORE, Plaintiff demands injunctive relief, in her favor and in favor of the Class, and against the Defendants, as follows:

A. Declaring that this action is properly maintainable as a class action, certifying Plaintiff as Class representative and certifying his counsel as Class counsel;

B. Preliminarily and permanently enjoining Defendants, their agents, counsel, employees and all persons acting in concert with them from consummating the Proposed Transaction on the terms presently contemplated;

C. To the extent the Proposed Transaction is consummated before entry of this Court’s judgment, rescinding it and setting it aside or awarding rescissory damages;

D. Awarding Plaintiff the costs and disbursements of this action, including reasonable attorneys’ and experts’ fees and expenses; and

E. Granting such other and further relief as this Court may deem just and proper.


Dated: April 7, 2015		COOCH AND TAYLOR, P.A.

		/s/ Blake A. Bennett
		Blake A. Bennett (#5133)
		The Brandywine Building
		1000 West Street, 10^thFloor
		Wilmington, DE 19801
		(302) 984-3800
		Attorneys for Plaintiff

OF COUNSEL:

BRODSKY & SMITH, LLC

Evan J. Smith

Marc L. Ackerman

Two Bala Plaza, Suite 510

Bala Cynwyd, PA 19004

(610) 667-6200

Exhibit (a)(5)(K)


		EFiled: Apr 08 2015 03:53PM EDT Transaction ID 57047231 Case No. 10891-

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE


MARK DURBIN, Individually and on Behalf of All Others Similarly Situated, Plaintiff, v.		C.A. No. -

CHRISTOPHER R. GARDNER, EDWARD ROGAS JR., MATTHEW B. FREY, STEVEN P. HANSON, JAMES HUGAR, SCOT JARVIS, WILLIAM C. MARTIN, KENNETH H. TRAUB, LLIU100 ACQUISITION CORPORATION, and MICROSEMI CORPORATION,
Defendants.

VERIFIED CLASS ACTION COMPLAINT

Plaintiff Mark Durbin (“Plaintiff”), by his attorneys, brings the following Verified Class Action Complaint (“Complaint”) on his own behalf and on behalf all stockholders of Vitesse Semiconductor Corporation (“Vitesse” or the “Company”), other than Defendants (as defined below) and their affiliates, Vitesse’s board of directors (the “Board” or the “Individual Defendants”) for breaching their respective fiduciary duties and/or aiding and abetting those breaches of fiduciary duty in connection with Microsemi Corporation’s (“Miscrosemi”) offer to acquire all of the Company’s outstanding shares of stock through a Tender Offer (the “Merger,” “Proposed Transaction,” or “Tender Offer”). The allegations in this Complaint are based upon Plaintiff’s personal knowledge as to himself, and upon information and belief and investigation of counsel as to all other allegations herein, as follows:

NATURE OF THE ACTION

1. Like several of the legacy telecom infrastructure players from the tech bubble, Vitesse repositioned itself to participate in the long-term trends of carrier Ethernet, edge routing, and wireless infrastructure. Just as this repositioning began to yield improved results and industry attention, the Company threw in the towel as a standalone operation and elected to merge with another entity injuring current stockholders.

2. Specifically, on March 18, 2015, Microsemi and Vitesse announced that they entered into a definitive agreement (the “Merger Agreement”) for Microsemi to acquire Vitesse in a transaction with a combined equity value of $389 million.

3. Under the terms of the Merger Agreement, which was unanimously approved by the boards of directors of both companies, Vitesse stockholders will receive $5.28 per share through a cash tender offer (the “Proposed Consideration”). The tender offer will be conducted via LLIU100 Acquisition Corporation (“Merger Sub”), a wholly owned subsidiary of Microsemi, which will merge with and into Microsemi upon the completion of the Proposed Transaction.

4. Microsemi expects to realize immediate accretion in the first full quarter upon completion of the Proposed Transaction, and expects the acquisition to result in accretion worth $.16 to $.20 per share in the first full fiscal year alone.

5. As detailed below, the Board members have breached their fiduciary duties by failing to maximize stockholder value in connection with the Proposed Transaction and failed to adequately account for the value and market potential of the merged entity.

6. Further, the Individual Defendants agreed to the Proposed Transaction through a flawed sales process designed to ensure the sale of Vitesse to Microsemi at a price substantially below the Company’s fair and inherent value. Moreover, Vitesse has been the target of activist investor pressure to pursue a sale of the Company for several years, and ultimately caved into such pressure from Raging Capital Management, LLC (“Raging Capital”) and its affiliates. In fact, not only did Vitesse previously name two of Raging Capital’s designees to the Board, but these two designees were placed on the Strategic Advisory Committee (“Committee”) in connection with the Proposed Transaction. Indeed, one of the designees, Defendant Kenneth H. Traub, was the Chairman of the Committee giving Raging Capital greater access and influence to pursue a potential sale, and liquidate its current stake of 20.9% of the Company’s shares.

7. Furthermore, the Individual Defendant engaged in self-dealing and obtained substantial benefits for themselves. In total, the executive officers, directors, and Raging Capital stand to receive over $82 million upon tendering their shares in favor of the Proposed Transaction. And, Defendant Christopher R. Gardner, the Company’s Chief Executive Officer, stands to receive an additional payout of over $3.9 million as a result of the Proposed Transaction. Additionally, on March 16, 2015 after the Board unanimously approved the Merger Agreement, the Compensation Committee approved the acceleration of the vesting of all the Company’s Restricted Stock Units (“RSUs”) held by Vitesse’s non-employee directors (the “Compensatory Agreements”). As a result, certain Individual Defendants stand to receive over $630,000 collectively in benefits not shared with the Company’s public stockholders.

8. On top of agreeing to the Proposed Transaction for inadequate consideration, the Individual Defendants have exacerbated their breaches of fiduciary duties by agreeing to unreasonable deal protection provisions that may unjustifiably hinder other bidders from making a successful competing offer for the Company.

9. While the Merger Agreement contains a brief go-shop provision which allowed the Company to solicit superior proposals, the go-shop period of twenty-one days expired on April 7, 2015, an insufficient amount of time for a potential bidder to conduct due diligence and make an informed offer. Moreover, even if the Company had received and accepted a superior bid, the topping bidder would still be required to pay a termination fee of $6.8 million or $13.6 million (depending on the timing) in addition to any additional consideration, representing a substantial naked premium as compared to the price paid by Microsemi.

10. Following the expiration of the go-shop period on April 7, 2015 the Merger Agreement provides for: (i) a strict no-solicitation provision that prohibits the Company from soliciting other potential acquirers or from continuing existing discussions with potential acquirers; (ii) a provision that provides Microsemi with four (4) business days to match any competing proposal in the event one is made, and an additional three (3) business day period to negotiate after the Company has agreed to a superior proposal; and (iii) a provision that requires the Company to pay Microsemi the aforementioned $13.6 million termination fee in order to enter into a transaction with a superior bidder. These provisions unreasonably inhibit the Board’s ability to act with respect to investigating and pursuing superior proposals and alternatives, including a sale of all or part of Vitesse.

11. In conjunction with the execution of the Merger Agreement, all of the Individual Defendants, as well as Raging Capital, executed a Tender and Support Agreement (the “Support Agreement”) with Microsemi and Merger Sub. The parties to the Support Agreement collectively own approximately 22% of Vitesse’s

outstanding shares. The Support Agreement provides that the Individual Defendants and Raging Capital have agreed to vote to tender their shares of Company common stock in favor of the Proposed Transaction, take certain other actions in furtherance of the Proposed Transaction, and to not vote any of their shares in favor of an alternative acquisition proposal from a third party bidder.

12. On March 31, 2015, Microsemi commenced the Tender Offer, which is set to expire 12:00 midnight, New York City time, on April 27, 2015 (the “Expiration Date”). The Tender Offer provides that the number of shares of Vitesse common stock that have to be validly tendered, together with the shares beneficially owned by Microsemi or any of its controlled subsidiaries, if any, equal a majority of the sum of the then outstanding Company shares plus (without duplication) a number equal to the number of Company shares issuable upon the vesting or exercise of all then outstanding Company stock options and restricted stock units as of the Expiration Date or at the time and date to which the Tender Offer has been extended.

13. Contemporaneously with the commencement of the Tender Offer, on March 31, 2015, Defendants filed a Solicitation/Recommendation Statement (the “Recommendation Statement”) on Schedule 14D-9 with the United States Securities and Exchange Commission (“SEC”) in connection with the Proposed Transaction, which contains numerous material misstatements and omissions. For

example, the Recommendation Statement fails to include material information concerning: (a) the background of the Proposed Transaction; (b) the key data and inputs underlying the financial valuation analyses that purport to support the so-called fairness opinion provided by Deutsche Bank Securities Inc. (“Deutsche Bank”); and (c) key financial projections for the Company.

14. The Individual Defendants have breached their fiduciary duties and Microsemi and Merger Sub have aided and abetted such breaches by Vitesse’s officers and directors. Plaintiff seeks to enjoin the Proposed Transaction unless and/or until Defendants cure their breaches of fiduciary duty, and/or recover damages resulting from Defendants’ violations of their fiduciary duties.

THE PARTIES

15. Plaintiff is and was, at all times relevant hereto, a holder of 35,000 shares of Vitesse common stock.

16. Non-party Vitesse is a Delaware corporation that maintains its principal executive offices at 4721 Calle Carga, Camarillo, California 93012. Vitesse is listed on the NASDAQ stock exchange under the ticker symbol “VTSS”. Vitesse “designs a diverse portfolio of high-performance semiconductors, application software, and intergrated turnkey systems for Carrier, Enterprise and Internet of Things (IoT) networks worldwide.”

17. Defendant Christopher R. Gardner is and has been, at all relevant times, a member of the Board. Mr. Gardner is the Chief Executive Officer of the Company and has served on the Board since 2006. Mr. Gardner entered into a Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

18. Defendant Edward Rogas Jr. is and has been, at all relevant times, a member of the Board. Mr. Rogas is Chairman of the Board of Directors, a member of the Audit Committee and Nominating and Governance Committee, and has served on the Board since 2006. Mr. Rogas entered into a Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

19. Defendant Matthew B. Frey is and has been, at all relevant times, a member of the Board. Mr. Frey is a member of the Nominating and Governance Committee, and has served on the Board since 2013. Mr. Frey entered into a Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

20. Defendant Steven P. Hanson is and has been, at all relevant times, a member of the Board. Mr. Hanson is Chair of the Nominating and Governance Committee, and has served on the Board since 2007. Mr. Hanson entered into a Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

21. Defendant James (Jay) Hugar is and has been, at all relevant times, a member of the Board. Mr. Hugar is Chair of the Audit Committee and a member of the Compensation Committee. Mr. Hugar has served on the Board since 2007. Mr. Hugar entered into a Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

22. Defendant Scot Jarvis is and has been, at all relevant times, a member of the Board. Mr. Jarvis is Chair of the Compensation Committee and a member of the Audit Committee. Mr. Jarvis has served on the Board since 2012. Mr. Jarvis entered into a Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

23. Defendant William C. Martin is and has been, at all relevant times, a member of the Board. Mr. Martin is a member of the Nominating and Governance Committee, and has served on the Board since 2014. Mr. Martin entered into a Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction. Mr. Martin is also Chairman and Chief Investment Officer of Raging Capital.

24. Defendant Kenneth H. Traub is and has been, at all relevant times, a member of the Board. Mr. Traub is a member of the Compensation Committee, and has served on the Board since 2013. Mr. Traub entered into a Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction. Mr. Traub is also affiliated with Raging Capital.

25. The Defendants identified in paragraphs 17 through 24 are collectively referred to herein as the “Individual Defendants” or the “Board.” By virtue of their corporate directorships, the Individual Defendants are fiduciaries of the Company as well as of Plaintiff and the other Company stockholders.

26. Each Individual Defendant herein is sued individually as well as in his capacity as an officer and/or director of the Company, and the liability of each arises from the fact that each has engaged in all or part of the unlawful acts, plans, schemes, or transactions of which Plaintiff complains of herein.

27. Defendant Microsemi is a Delaware corporation that maintains its principal executive offices at One Enterprise, Aliso Viejo, California. Microsemi is listed on the NASDAQ stock exchange under the ticker symbol “MCSS”. Microsemi is a “leading designer, manufacturer and marketer of high-performance analog and mixed-signal semiconductor solutions differentiated by power, security, reliability and performance.”

28. Defendant LLIU100 Acquisition Corp. is a Delaware Corporation and a wholly owned subsidiary of Microsemi created to effectuate the Proposed Transaction.

29. Collectively, Microsemi, Merger Sub, and the Individual Defendants are referred to herein as “Defendants” where it is appropriate to do so.

CLASS ACTION ALLEGATIONS

30. Plaintiff brings this action on his own behalf and as a class action on behalf of all other public stockholders of Vitesse (except Defendants herein, and any persons, firm, trust, corporation or other entity related to or affiliated with them and their successors in interest), who are or will be threatened with injury arising from defendants’ wrongful actions, as more fully described herein (the “Class”).

31. This action is properly maintainable as a class action for the following reasons:

a. The Class is so numerous that joinder of all members is impracticable. According to the Company’s latest 10-Q filed with the SEC on February 3, 2015, there are 68,426,000 shares of common stock outstanding as of December 31, 2014. There are likely thousands of beneficial holders of Vitesse common stock scattered throughout the world.

b. There are questions of law and fact which are common to the Class including, among other things, whether:

The Defendants engaged in a proper process that maximized stockholder return;

ii.

The Defendants breached their fiduciary duties of loyalty and/or due care with respect to Plaintiff and the other members of the Class in connection with the Proposed Transaction;

iii.

The Defendants unjustly enriched themselves and other insiders or affiliates of Proposed Transaction;

iv.

The Defendants breached any of their other fiduciary duties to Plaintiff and the other members of the Class in connection with the Proposed Transaction, including the duty of good faith and fair dealing;

Microsemi and Merger Sub aided and abetted the breaches of fiduciary duties alleged by Plaintiff against the Individual Defendants; and

vi.

Plaintiff and the other members of the Class entitled to injunctive relief or damages as a result of Defendants’ wrongful conduct.

c. Plaintiff is committed to prosecuting this action and has retained competent counsel experienced in litigation of this nature. Plaintiff’s claims are typical of the claims of the other members of the Class and Plaintiff has the same interests as the other members of the Class. Accordingly, Plaintiff is an adequate representative of the Class and will fairly and adequately protect the interests of the Class.

d. The prosecution of separate actions by individual members of the Class would create the risk of inconsistent or varying adjudications with respect to individual members of the Class which would establish incompatible standards of conduct for defendants, or adjudications with respect to individual members of the Class, which would as a practical matter be dispositive of the interests of the other members not parties to the adjudications or substantially impair or impede their ability to protect their interests.

SUBSTANTIVE ALLEGATIONS

Background

32. Vitesse is a “fabless” American semiconductor company based in Camarillo, California, which develops high-performance Ethernet integrated circuit solutions for Carrier, Enterprise and Internet of Things (IoT) networks. Fabless manufacturing is the design and sale of hardware devices and semiconductor chips while outsourcing the fabrication, or “fab,” of the devices to a specialized manufacturer called a semiconductor foundry. Foundries are typically, but not exclusively, located in China and Taiwan.

33. Vitesse was one of the early developers of Gallium Arsenide based integrated circuits. It now offers a line of Ethernet switching products consisting of Carrier Ethernet switch engines for customer premise equipment, access network equipment, wireless base stations, mobile access equipment, fiber and microwave wireless backhaul equipment, and metro networking equipment; and Ethernet switches that enable desktop, workgroup, and LAN infrastructure

34. The last few years have seen the Company beleaguered by fraud claims and allegations of malfeasance. For instance, in 2007 the Company settled a class action lawsuit alleging securities fraud through option backdating. Vitesse’s woes continued, and in 2010, two of its former executives, founder Lou Tomasetta and the former executive vice president Eugene Hovanec were charged with securities fraud related to the backdating. Vitesse memorialized a settlement for $3 million with the SEC, over investigations into the firm’s historical stock options practices and accounting. Even so, from that point forward, the Company began a steady turnaround marked by the Company’s increased penetration into the Ethernet and connectivity space, shedding old businesses while entering new markets.

35. Indeed, in March 2011, Vitesse stock was approved for listing on the NASDAQ, and commenced trading under the symbol VTSS.

36. In recent years, Vitesse has closed several secondary public offerings (“SPOs”). In December 2012, Vitesse raised $17.1 million, net of offering costs, from an offering of 10.6 million shares at an offering price of $1.75 per share. In June 2013, Vitesse completed an additional secondary public offering of 18.72 million shares of common stock at an offering price of $2.15 per share, receiving net proceeds of approximately $37.4 million after underwriting discounts.

37. In June 2014, Vitesse closed another SFO of 8.5 million shares at an offering price of $3.35, for net proceeds of approximately $26.7 million.

38. Raging Capital, the Company’s largest shareholder, purchased 1.6 million shares in the June 2014 offering, raising its stake in Vitesse to 14.3 million shares. Defendant Martin, the chairman and chief investment officer of Raging Capital, became a Vitesse director in August 2014. SEC filings show that Raging Capital owns 21% of Vitesse’s shares.

39. For each of the SPOs, Needham & Company, LLC (“Needham”) acted as the sole book-running manager of the offering.

40. The Company used the proceeds of the SPOs to pay off debt and grow new lines of business. In October 2014, Vitesse repaid the outstanding principal of $32.8 million, plus accrued interest, on the Company’s convertible subordinated debentures, reducing the Company’s outstanding debt. Accordingly, interest expense on the outstanding debentures will be $0.3 million in fiscal year 2015, compared to interest expense of $4.4 million in 2014.

41. With respect to the Company’s prospects, Vitesse has recently stated that it expects to enjoy substantial revenues from the vast new opportunities in developing markets.

42. Specifically, Vitesse specializes in the “The Internet of Things” (IoT) which is the networking of physical objects or “things” that are embedded with electronics, software, sensors and connectivity to enable the physical object to achieve greater value and service by exchanging data with the manufacturer,

operator, and/or other connected devices. Each thing is uniquely identifiable through its embedded computing system but is able to interoperate within the existing internet infrastructure. Simply stated, Vitesse’s products facilitate device to device communication which can provide clients with the data to necessary create economical and resource-saving solutions.

43. IoT is expected to offer advanced connectivity of devices, systems, and services that goes beyond machine-to-machine communications (M2M) and covers a variety of protocols, domains, and applications. The interconnection of these embedded devices (including smart objects), is expected to usher in automation in nearly all fields, while also enabling advanced applications like a Smart Grid, which automatically and efficiently distributes resources reducing costs and increasing sustainability.

44. The “things” referenced in the IoT, can refer to a wide variety of devices such as heart monitoring implants, biochip transponders on farm animals, automobiles with built-in sensors, or field operation devices that assist fire-fighters in search and rescue. These devices collect useful data with the help of various existing technologies and then autonomously flow the data between other devices. Current market examples include smart thermostat systems and washer/dryers that utilize Wi-Fi for remote monitoring.

45. With respect to this business space, Vitesse represents that it is a leading supplier of integrated circuits [IC] for next-generation Ethernet-based Carrier, Enterprise, and IoT networks worldwide. It develops and markets a diverse portfolio of high-performance, feature-rich, low-power and cost-competitive Ethernet networking and connectivity IC solutions, associated applications and protocol software.

46. The Company states that many of the technologies it has developed for Carrier and Enterprise networking are highly synergistic in emerging adjacent markets, such as the industrial IoT, automotive, storage and other networks converging on Ethernet. Simply stated, Vitesse is trying to enable diverse networking industries to make the transition from legacy to standards-based, ubiquitous “Ethernet Everywhere” networking.

Inadequate Merger Consideration in Light of the Company’s Prospects

47. The Company’s new turnaround is reflected in its fourth quarter and fiscal 2014 earnings, released on December 4, 2014, highlighted by the following:

Growth in New Product Revenues of 11% Sequentially and 73% Year-over-Year, Driven by Ethernet Everywhere Strategy, Represents 57% of Total Product Revenues

Increased Gross Margins to 63.1% from 52.5% in Fourth Quarter of Fiscal Year 2013

Reached Non-GAAP Operating Profit of $1.0 Million for the Fourth Quarter Added Over 130 New Customers in Fiscal Year 2014, Resulting in Greater Diversification to Support Future Revenue Growth

Achieved Record Design Win Success in Fiscal Year 2014

Strengthened Balance Sheet with Repayment of 2014 Convertible Debentures

48. Commenting on the results, Mr. Gardner, CEO of Vitesse, stated “[w]e are very pleased with the success of Vitesse’s ‘Ethernet Everywhere’ strategy and our execution is increasingly evident as demonstrated by our revenue growth, the upward trend in gross margins, design win success, and now, achieving non-GAAP operating profitability.”

49. Mr. Gardner further stated that “[i]n 2014, design wins for our new products reached record highs. Major wins in Carrier and Enterprise continued accumulating steadily, while those in emerging markets, such as Industrial-IoT and Storage, accelerated dramatically.”

50. With respect to IoT, Mr. Gardner stated “the Company experienced a 200% increase in design wins in the year, now representing 37% of the total. IoT was also a major contributor to our 130 new customers in the year. We believe this growth in IoT will continue as the need to network all things escalates, expanding our served market by nearly $400 million. This market provides multiple avenues to create substantial revenue growth and literally transform Vitesse. Accordingly, we have updated our reporting structure to breakout our IoT business as a third core market.” (Emphasis added.)

51. The positive news continued when Mr. Gardener stated “[t]o address our growing opportunities, we invested in our development organizations, adding critical industry expertise in hardware and software, and in our marketing and sales organizations, including hiring additional sales representatives and distributors. We also achieved a financial milestone by eliminating the dilution overhang with the repayment of our convertible debentures. While our legacy business has declined over the past several years, our new business is growing rapidly. We are increasingly confident that this growth, combined with strengthening gross margins, the high degree of operating leverage in our business, and our improved balance sheet, will generate significant shareholder value.”

52. The actual fiscal results from the Q4 FY’14 similarly reflected improvement across the board especially in the revenue category:

Total net revenues were $28.7 million, compared to $27.2 million in the third quarter of fiscal year 2014 and $26.9 million in the fourth quarter of fiscal year 2013. ° Product revenues were $27.0 million, compared to $26.0 million in the third quarter of fiscal year 2014 and $26.5 million in the fourth quarter of fiscal year 2013.

Product revenues by market, excluding non-core revenues of $1.2 million, contributed the following as a percentage of product revenues as compared to the third quarter of fiscal year 2014:

Carrier networking products: 47.1% versus 43.9%

53. Similarly, margins improved while operating expenses held steady and losses were cut:

Product margins were 60.9%, compared to 52.9% in the third quarter of fiscal year 2014 and 51.8% in the fourth quarter of fiscal year 2013. Total gross margins were 63.1%, compared to 54.9% in the third quarter of fiscal year 2014 and 52.5% in the fourth quarter of fiscal year 2013.

Operating expenses were $18.8 million, compared to $17.4 million in the third quarter of fiscal year 2014 and $17.6 million in the fourth quarter of fiscal year 2013.

Operating loss was $0.7 million, compared to operating loss of $2.5 million in the third quarter of fiscal year 2014 and $3.5 million in the fourth quarter of fiscal year 2013.

Non-GAAP operating income was $1.0 million, compared to non-GAAP operating loss of $0.9 million in the third quarter of fiscal year 2014 and non-GAAP operating loss of $2.3 million in the fourth quarter of fiscal year 2013.

Net loss was $2.5 million, or $0.04 per basic and fully diluted share. This compares to net loss of $4.4 million, or $0.07 per basic and fully diluted share, in the third quarter of fiscal year 2014, and net loss of $5.8 million, or $0.10 per basic and fully diluted share, in the fourth quarter of fiscal year 2013.

Non-GAAP net loss was $0.8 million, or $0.01 per basic and fully diluted share, compared to non-GAAP net loss of $2.7 million, or $0.04 per basic and fully diluted share, for the third quarter of fiscal year 2014, and non-GAAP net loss of $4.6 million, or $0.08 per basic and fully diluted share, in the fourth quarter of fiscal year 2013.

54. Similarly, in a year over year comparison, fiscal year 2014 financial results were also greatly improved:

Total net revenues for fiscal year 2014 were $108.5 million compared with $103.8 million for fiscal year 2013.° Product revenues were $102.8 million, compared with $101.3 million in fiscal year 2013.

Product revenues by market, excluding non-core revenues of $1.6 million, contributed the following as a percentage of fiscal year 2014 product revenue as compared to the fiscal year 2013: Carrier networking products: 46.8% versus 55.5%

55. Again, margins, expense figures, and operating loss calculations improved over the prior fiscal year:

Product margins were 56.7% in fiscal year 2014, compared to 53.9% in the prior year. Total gross margins were 59.0%, compared to 54.9% in the prior year.

Operating expenses were $73.8 million, compared to $72.5 million in fiscal year 2013.

Loss from operations was $9.8 million, compared with loss from operations of $15.5 million in fiscal year 2013.

Non-GAAP loss from operations was $3.3 million, compared with non-GAAP loss from operations of $10.7 million in fiscal year 2013.

Net loss was $18.1 million, or $0.30 per basic and fully diluted share, in fiscal year 2014, compared with a net loss of $22.1 million, or $0.55 per basic and fully diluted share, in fiscal year 2013.

Non-GAAP net loss was $10.0 million, or $0.16 per basic and fully diluted share, in fiscal year 2014 compared with a non-GAAP net loss of $18.1 million, or $0.45 per basic and fully diluted share, in fiscal year 2013.

56. Finally, the Company’s balance sheet improved as the Company retained more cash and paid down debt:

Balance Sheet Data at September 30, 2014 as Compared to September 30, 2013

Cash and restricted cash were $72.7 million, compared to $69.0 million.

Accounts receivable was $10.9 million, compared to $9.8 million.

Inventories were $12.8 million, compared to $10.7 million.

Repayment of 2014 Convertible Debentures

On October 30, 2014, the Company repaid in full the remaining $32.8 million in principal amount of its 8.0% convertible second lien debentures due October 2014. The repayment eliminates annual cash interest payments and annual interest expense of approximately $2.6 million and $4.0 million, respectively. Following this repayment of its second lien debentures, the Company’s only outstanding debt is $17.2 million in principal amount of senior term loan debt due August 2016.

57. Finally, the Company issued a positive financial outlook:

For the first quarter of fiscal year 2015, ending December 31, 2014, Vitesse expects revenues to be in the range of $24.0 million to $26.5 million and product margins to be between 57% and 60%. GAAP operating expenses are expected to be between $18.5 million and $19.5 million.

58. The Company’s new vibrancy is further reflected in its earnings from the first quarter for fiscal year 2015, released on February 3, 2015, highlighted by the following:

Revenues of $24.8 million

New product revenue of $16.2 million, representing 82% year-to-year growth and 68% of total product revenue in the quarter Opportunities created at new customers were double the rate of fiscal year 2014

Record pace for design wins, IoT wins representing 40% of total

59. Vitesse’s Q1 FY’15 earnings release touts that, “New product revenue continues on a solid trajectory reaching $16.2 million in the quarter, up 82% on a year to year basis. New products now represent 68% of our total product revenue.”

60. In terms of growth prospects, Mr. Gardner states in the release, “Our customer profile continues to grow and evolve as our position strengthens in new, adjacent markets such as IoT and storage, which are literally reshaping our business and expanding our market opportunity. Our expanded sales team dramatically increased both opportunities and design wins, more than doubling the number of new customers in the pipeline, setting us on pace for another record year. As Ethernet propagates into new markets, our total addressable market will triple from approximately $1 billion today to over $3 billion by 2020.” (Emphasis added.)

61. While Vitesse has yet to fully shed its lagging businesses, the newer products are generating profitable margins to off-set the declines, while simultaneously signaling extensive future prospects. Vitesse’s Q1 FY15 earnings release propounds, “As anticipated, we saw a meaningful decrease in revenue from our legacy products in the first quarter and expect another smaller decline in the second quarter. These declines will be more than offset by new product revenue growth of 50% to 75% for the full fiscal year. We continue to manage expenses carefully as we move through the transition and remain on target to deliver gross product margins of 60% in fiscal year 2015. All told, the leading indicators of our business are strong and we are well positioned with the technology, products, market position, and customers to capitalize on the exciting growth opportunities we are seeing in the market.”

62. The fiscal results from the Q1 FY’15 reflected that legacy costs are currently inhibiting growth, but the financial statements reflect that the new business prospects are buoying the Company while it reduces its legacy exposures:

Total net revenues were $24.8 million, compared to $28.7 million in the fourth quarter of fiscal year 2014 and $27.1 million in the first quarter of fiscal year 2014. ° Product revenues were $24.0 million, compared to $27.0 million in the fourth quarter of fiscal year 2014 and $24.9 million in the first quarter of fiscal year 2014. Revenues by market contributed the following as a percentage of product revenues as compared to the fourth quarter of fiscal year 2014:

Carrier networking products: 47.4% versus 45.1% Enterprise networking products: 43.7% versus 39.9% Industrial-IoT networking products: 8.9% versus 15.0%

63. Similarly, the Q1 FY’15 earnings reflect the debt reduction that occurred in the Q4 FY’14 that will propel the Company into the next phase of its growth:

Cash and restricted cash were $33.4 million, compared to $72.7 million, reflecting the $32.8 million debt repayment in October 2014.

64. In addressing the short-term results, Mr. Gardner promulgated the long-term transition at the Stifel, Nicolaus Technology, Internet & Media Conference on February 9, 2015 (“Stifel Internet Conference”), focusing on the investments the Company has made over the past years of up to $200 million in order to target the carrier environment as it transitions from “older sonic technologies” to the Ethernet in “industrial applications bridging over to commercial and even consumer application in IoT. . . . We estimate that our current portfolio of products targeting these markets has a lifetime revenue of over 1.5 billion, less than 10% of that realized to date.” (Emphasis added.)

65. To support this estimate, Mr. Gardner points out that Vitesse’s “new product revenue is growing, about 80% compounded over the last two years. In fact, in Q1, our December quarter, we just announced new product revenue was up 82% year-on-year.”

66. Furthermore, Mr. Gardner states, “We expect that to swell a little bit on a percentage basis, but continue to be up on an annual basis between 50% and 75%. So, we’re seeing over 50% growth rate and design wins, and we’ve now attained a pretty good milestone where 68% of our revenue is coming from this new product portfolio. So, it’s well on its way to start outstripping our legacy product declines.”

67. Not only has Vitesse started to transition itself into these new markets, but as Mr. Gardner relates, Vitesse is “one of a very few handful of players selling this networking technology.” Importantly, “the barrier to entry into this technology is so high” providing a very favorable competitive environment. In terms of competition, it is of note that “We see virtually no startups in this segment because of the complexity and the sophistication of both our products and our customers.”

68. The revenue driver for Vitesse in the long-term will be the deployment of industrial IoT, which will allow the deployment of Ethernet networking solutions into previously untapped markets such as “intelligent transportation, highway monitoring, railway monitoring and connection, smart grid distribution of energy, IP video surveillance camera and the networking of that camera, and factory automation.” This will yield a market of previous set of end customers, such as Shell Oil or Chevron instead of traditional networkers like Cisco, AT&T and Verizon.

69. Martin McDermut, the CFO of Vitesse, echoed these sentiments at the Stifel Internet Conference, stating that the Company is going through a transition stage. “This impacted our revenue trends, and it has also impacted our gross margins. Up to this point, the decline in the mature product revenues has offset what’s happening with the growth in the new product revenue growth, but we’re getting to the point where that’s going to change, so it’s going to get exciting here.” 70. Mr. McDermut further touts the changes, “And so what’s our investment thesis? We’ve got the right products in the right market, in a growing market, and at the right time.”

71. Against this backdrop of a Company having paid down extensive debts, currently transitioning out of its legacy businesses and into new and highly profitable markets with high barriers to entry, the Board has, in breach of their fiduciary duties, agreed to the Proposed Transaction, short-changing the stockholders of any future value.

Summary of the Proposed Transaction

72. In a press release dated March 18, 2015, the Company announced that it had entered into the Merger Agreement with Microsemi, pursuant to which Microsemi, through Merger Sub, will commence the Tender Offer to acquire all of the outstanding shares of Vitesse for a purchase price of $5.28 per share in cash.

73. The terms of the Merger Agreement provide that Merger Sub agreed to commence the Tender Offer no later than March 31, 2015. The number of shares of Vitesse common stock that have to be validly tendered, together with the shares beneficially owned by Microsemi and Merger Sub, if any, must represent at least a majority of all then outstanding shares of Vitesse common stock prior to the expiration of the Tender Offer, which is on the twentieth (20th) business day following commencement of the Tender Offer, or at the time and date to which the Tender Offer has been extended.

74. As such, Microsemi commenced the Tender Offer for $5.28 per share in cash on March 31, 2015 with the Tender Offer currently set to expire on April 27, 2015.

75. Following successful completion of the Proposed Transaction, the Company will merge with and into Microsemi, with the Company surviving as a wholly owned subsidiary of Microsemi.

76. Each outstanding Company stock option, whether vested or unvested, (excluding those options that have an exercise price per share of Company common stock greater than $8.20) will be assumed by Microsemi and become exercisable for a number of Microsemi common stock shares equal to the product

of (i) the number of shares of Vitesse common stock that would be issuable upon exercise of the stock option immediately prior to the Effective Time multiplied by (ii) the quotient resulting from the division of (x) the merger consideration by (y) the average closing price of Microsemi common stock for the five trading days immediately preceding the Effective Time.

The Proposed Transaction Fails to Maximize Stockholder Value

77. The Merger Consideration is inadequate and significantly undervalues the Company. Microsemi is seeking to acquire the Company at the most opportune time, at a time when the Company is positioned for tremendous growth.

78. The Merger Consideration fails to adequately compensate Vitesse’s stockholders for the significant synergies created by the Proposed Transaction.

79. In the press release on March 18, 2015, announcing the Proposed Transaction, Defendant Gardner, noted the benefit of the synergies as a result of the Proposed Transaction:

The proposed acquisition of Vitesse by Microsemi will create a powerful combination . . . . I believe Microsemi will be able to leverage Vitesse’s Ethernet technology and capabilities further into the communications market and has the scale to implement the adoption of our industrial IoT strategy.

80. In the same press release, Microsemi noted that, due to synergies from the Proposed Transaction, it expects to see immediate accretion in the first full quarter of completion. In total, Microsemi expects the acquisition to be $0.16 to $0.20 per share accretive in the first fiscal year ending September 30, 2016.

81. The Board’s decision to sell the Company for inadequate consideration both fails to maximize stockholder value and deprives the Company’s stockholders of their ability to reap the benefits of Vitesse’s promising long-term financial returns.

82. The Proposed Transaction gives Microsemi access to Vitesse’s suite of solutions and customer pipeline. In fact, according to Yahoo! Finance, at least one analyst has set a price target for the Company at $6 per share, representing a 12% premium to the price being offered by Microsemi.

83. Indeed, analysts who follow the Company believe the consideration to be inadequate. In an online article published by Barron’s, analysts with Ascendiant Capital Markets believed the $389 million offer to be low, expecting a “moderately higher premium, more in-line with the growth opportunities ahead.”

84. Given the value and potential value of the Company’s pipeline of customers, the Board failed to maximize stockholder value.

85. The Board’s decision to sell the Company for inadequate consideration both fails to maximize stockholder value and deprives the Company’s stockholders of their ability to reap the benefits of Vitesse’s promising long-term financial returns.

The Flawed and Unreasonable Sales Process

86. The Board did not protect against the conflicts of interest from their own financial self-interest in the Proposed Transaction. Section 3.5 of the Merger Agreement states that the entire Board and all executive officers of the Company will continue in their respective capacities in the surviving corporation. The Proposed Transaction allows the Individual Defendants to collect any change-of-control benefits (including, but not limited to, the assumption of stock options by Microsemi and the acceleration of RSUs). As a result, the sales process was flawed and unreasonable.

87. In October 2011, the Board formed a Strategic Advisory Committee (the “Committee”) to explore and pursue, consider, and recommend to the full Board to consider potential acquisitions, dispositions, financings, and other transactions and initiatives. Initially, the Committee was focused on transactions that would reduce Vitesse’s substantial indebtedness that would begin to mature in February 2014. The Recommendation Statement does not disclose the members selected for the Committee.

88. In July 2012, the Company engaged Needham as sole book-running manager to Vitesse in connection with three public offerings by Vitesse of its common stock pursuant to which the Company raised an aggregate of approximately $80 million in net proceeds from December 2012 through June 2014. In July 2012, the Company also engaged Needham as its exclusive financial advisor in a strategic transaction.

89. In late 2012, the Board was contacted by Company A that expressed an interest in exploring a possible acquisition of the Company. On December 17, 2012, Company A submitted a non-binding proposal to acquire Vitesse for $2.50 to $3.00 per share in cash.

90. Thereafter, on January 9, 2013, Company A increased its proposed purchase price range to $2.75 to $3.25 per share in cash. On February 22, 2013, the Company executed a non-disclosure agreement (“NDA”) with Company A. On March 7, 2013, Company A fixed its proposed purchase price at $3.05 per share in cash and requested exclusivity to negotiate a transaction.

91. Also, on March 7, 2013, the Board unanimously determined that the $3.05 per share proposal substantially undervalued the Company. On March 11, 2013, Vitesse communicated its position to Company A that it would not continue discussions with Company A unless Company A substantially increased its proposed purchase price. On March 13, 2013, Company A declined to increase its proposed purchase price and discussions were terminated.

92. While Vitesse had engaged in discussions with Company A, the Board also authorized to meet with other potential acquirors should the Board decide to authorize a sale process for the Company. Two other potential parties, including Microsemi, expressed interest in pursuing an acquisition.

93. On March 13, 2013, Microsemi and the Company signed an NDA, which contained an 18-month standstill provision set to expire on September 13, 2014.

94. On April 17, 2013, Company B submitted a non-binding proposal to acquire the Company for cash consideration of $3.25 to $3.50 per share and requested exclusivity. Then, on May 15, 2013, Microsemi submitted a non-binding proposal to acquire the Company for cash consideration of $2.80 per share and also requested exclusivity. The Company determined that both proposals substantially undervalued Vitesse and informed Company B and Microsemi that the Company was not interested in pursuing a sale transaction.

95. For the next year, the Company continued its efforts to provide for the reduction of its substantial indebtedness.

96. On May 19, 2014, Microsemi submitted a second non-binding proposal to acquire the Company for a purchase price of $4.00 per share in cash and requested exclusivity.

97. On May 21, 2014, the Committee met with Needham and the Company’s legal counsel, Stubbs Alderton & Markiles, LLP (“Stubbs Alderton”), where Needham presented a limited valuation analysis to assist the Committee in its consideration of various financing proposals under consideration prior to Microsemi’s second proposal.

98. At a May 29, 2014 meeting, the Committee once again concluded that Microsemi’s proposal significantly undervalued Vitesse and that any discussions with Microsemi regarding a possible sale transaction would likely preclude the Company from pursuing a capital raise during the pendency of those discussions. Thus, the Committee recommended to the Board that the Company continue with its capital-raising plans, which the Board authorized management to do by pursuing a public offering and informing Microsemi that the Board was not interested in engaging in a sale process at that time.

99. From June 2014 through August 2014, Microsemi continued to express interest in acquiring the Company as James Peterson (“Peterson”), Microsemi’s Chairman and CEO, and Steven Litchfield (“Litchfield”), Microsemi’s Executive Vice President and Chief Strategy Officer, contacted Defendant Gardner by letter and email correspondence. During this time, Vitesse maintained that the Company was not for sale, but expressed a willingness to continue discussions if Microsemi agreed to extend the standstill arrangement in the parties’ NDA.

100. On August 13, 2014, the Committee met to discuss Microsemi’s continued interest in acquiring Vitesse. The Committee also discussed the prospect of William C. Martin of Raging Capital joining the Board. The Committee considered the likely impact that Defendant Martin’s service on the Board would have on any hostile takeover activity. Also, on August 13, 2014, the Nominating Committee met to discuss the possibility of Defendant Martin being appointed to the Board, and ultimately resolved to recommend to the Board that Martin be invited to join the Board.

101. On August 15, 2014, the Board unanimously resolved to expand its size from seven to eight members and to appoint Defendant Martin as a director. Defendant Martin’s appointment became effective on August 20, 2014. Remarkably, shortly after Defendant Martin joined the Board, two steps were taken which drastically altered the course of the Company. First, on September 8, 2014, just after Martin joined the Board, the Committee abruptly decided to essentially abandon plans to continue the Company as a standalone entity, and (according to the Recommendation Statement) “unanimously resolved to initiate a process to seek third-party interest in an acquisition of Vitesse, and authorized and directed management to begin this process in consultation with Needham and Stubbs Alderton.” Second, the Board abruptly reconstituted the Committee in order to accommodate Defendant Martin, reducing the size of that committee from six to three members, purportedly to make it “more efficient,” making Martin and Traub (Raging Capital’s designees) two out of the three members, and modifying the committee’s mandate in light of the Board’s decision to conduct a sale process.

102. On September 5, 2014, Microsemi sent a letter to Vitesse reiterating Microsemi’s views regarding its $4.00 per share proposal and requesting that Vitesse engage with Microsemi to help it better understand why Vitesse’s Board had determined that Microsemi’s proposed price undervalued the Company. Microsemi also indicated its willingness to extend the parties’ standstill by an additional six months.

103. On September 8, 2014, the Committee authorized Defendant Gardner to pursue an extension of the standstill with Microsemi, and Stubbs Alderton prepared an amendment to the Microsemi NDA to extend it by six months. Defendant Gardner sent the amendment to the NDA to Peterson and Litchfield on September 11, 2014, which Microsemi never subsequently responded to resulted in the expiration of the standstill on September 13, 2014.

104. Also on September 8, 2014, the Committee unanimously resolved to initiate a process to seek third-party interest in an acquisition of Vitesse, and authorized and directed management to begin this process in consultation with Needham and Stubbs Alderton.

105. As mentioned above, on October 1, 2014, the Board approved the reconstitution of the Committee, reducing the size from six members to three members. Defendants Hanson, Martin, and Traub were appointed to the Committee, with Traub as Chairman of the Committee.

106. Also on October 1, 2014, the Compensation Committee approved a program to provide for the payment of success and transition bonuses in connection with an acquisition of Vitesse to certain employees identified by Defendant Gardner, although Defendant Gardner was ineligible. The Committee approved up to $1 million in bonus payments.

107. Further, on October 1, 2014, the Board determined to pursue retention of an additional investment banking firm, and on October 31, 2014, Vitesse retained Deutsche Bank. Concurrently with Deutsche Bank’s engagement, Vitesse and Needham amended their existing agreement to provide for Deutsche Bank’s services as financial advisor to Vitesse and to modify the success fee payable to Needham upon the closing of a strategic transaction.

108. On October 7, 2014, the Compensation Committee approved new employment agreements for Defendant Gardner and Martin S. McDermut, Chief Financial Officer of the Company. Although the Recommendation Statement provides that the new agreements do not increase the total amount of post-termination payments to these executives above what was provided for in the executives’ prior employment agreements, the new agreements provide for an increase in severance benefits if any termination occurs in connection with a change in control of Vitesse.

109. During November and December 2014, Company management, along with Deutsche Bank and the Committee, identified a target group of potential interested parties. The Recommendation Statement does not disclose who was in this target group or the criteria used to identify the potential parties.

110. On December 9, 2014, Deutsche Bank met with the Board to review the Company’s proposed sale process plan, including which parties would be contacted and when, the script for the initial contact, and the type of information about the Company that would be shared under NDAs.

111. Commencing on January 5, 2015, Deutsche Bank contacted strategic parties to solicit their potential interest in acquiring Vitesse. From January through February 2015, 27 potential bidders, including Company A, Company B, and Microsemi were contacted. In fact, Microsemi was specially advised of the Company’s sale process on January 26, 2015, at a lunch between Defendant Garden and Peterson. The Company executed NDAs with 11 parties, including Company A, but not Company B which declined to participate.

112. In January and February 2015, management conducted one or more in-person meetings with 10 parties that had requested meetings and were party to a NDA. In addition to reviewing Vitesse’s worldwide operations and synergies specific to each company, Vitesse provided several companies with additional materials to address questions.

113. On February 5, 2015, Microsemi and Vitesse amended their existing NDA (from March 13, 2013) to reinstate and extend the standstill provisions until March 13, 2015. Also on February 5, 2015, Vitesse’s management and Deutsche Bank met in-person with Mircosemi’s management.

114. On February 10, 2015, Microsemi submitted a non-binding proposal to acquire Vitesse for $4.75 per share in cash and requested exclusivity.

115. On February 11, 2015, Peterson exchanged emails with Defendant Gardner proposing a four-week go-shop period to address the Company’s concerns about entering into exclusivity with Microsemi. Defendant Gardner also sent an email to Litchfield addressing possible product synergies between Vitesse and Microsemi.

116. On February 12, 2015, the Board authorized Deutsche Bank to contact two additional strategic parties that previously had not been approached due to competitive reasons, both of which subsequently executed NDAs. One of these parties did not make a proposal, and the other party was unable to schedule a meeting in the near term.

117. From February 12, 2015 until February 18, 2015, Vitesse continued to meet with other potential acquirors that had signed NDAs and expressed interest in the Company.

118. On February 18, 2015, Deutsche Bank updated the Board that eight parties stated they were still considering making a proposal for Vitesse. The Board also determined that Microsemi’s $4.75 proposal undervalued the Company and that the Company should continue its sale process.

119. On February 18, 2015, Peterson informed Defendant Traub that Microsemi was prepared to propose a purchase price of $5.18 per share, a 20-day period of exclusivity, and a post-signing go-shop period. Peterson contacted Defendant Traub twice more on February 18, 2015 to discuss the possibility of an increase in Microsemi’s proposal to as much as $5.28 per share.

120. On February 19, 2015, Litchfield delivered to Vitesse a revised indication of interest with a cash purchase price of $5.28 per share, a 20-day period of exclusivity, a 21-day post announcement go-shop period, no financing condition, and an anticipated period to announcement of a transaction of six weeks or less.

121. As of February 20, 2015, of the 27 parties contacted, only four parties in addition to Microsemi were still evaluating whether to make a proposal to acquire Vitesse. On February 20, 2015, the Board unanimously approved entering into exclusive negotiations with Microsemi, subject to certain revisions provided to Microsemi later that day.

122. From February 23, 2015 through March 17, 2015, Microsemi, Vitesse, and their respective representatives held numerous due diligence calls and negotiated terms to the Merger Agreement and Support Agreement.

123. On February 26, 2015, the Compensation Committee approved an extension of the term of change-in-control agreements already in effect for certain employees, excluding Defendant Gardner, McDermut, and Dr. Martin Nuss, the Company’s Chief Technical Officer and Vice President of Technology & Strategy. The Compensation Committee resolved to extend the term of expiration until February 2016, in part to ensure that the agreements remained in effect through consummation of any transaction resulting from the Company’s sale process.

124. On March 5, 2015, the strategic party that had signed an NDA with Vitesse during the sale process but was unable to arrange a management meeting due to scheduling conflicts contacted Deutsche Bank to request additional information about the sale process. Thereafter, Deutsche Bank informed this party that Vitesse could not engage in discussions at that time given Vitesse’s exclusivity agreement with Microsemi.

125. On March 11, 2015, Vitesse and Microsemi agreed to an extension of the exclusivity period, set to expire on March 15, 2015, until March 17, 2015.

126. The Board unanimously approved the Merger Agreement on March 16, 2015. Also, on March 16, 2015, the Compensation Committee approved the Compensatory Agreements, allowing for the acceleration of vesting of RSUs held by the Individual Defendants effective immediately prior to the Effective Time.

127. On March 17, 2015, Microsemi, Merger Sub, and Vitesse executed the Merger Agreement and Microsemi, Merger Sub, the directors of Vitesse, and Raging Capital executed the Support Agreement.

128. On March 18, 2015, Microsemi and Vitesse announced the Proposed Transaction. Following the announcement, Vitesse commenced a go-shop process, which continued through April 7, 2015.

129. As demonstrated above, the Company failed to run a reasonable sale process.

130. Further, the lack of information with regard to the various NDAs the Company entered into leads to the belief that the Company was inconsistent in its treatment of the various parties throughout the sale process. This is likely given that the Company extended Microsemi’s exclusivity period knowing that there was another strategic party that reached out to the Company on March 5, 2015 who was interested in engaging in discussions with management.

131. All of the Individual Defendants, the executive officers, and Raging Capital are set to receive substantial compensation upon consummation of the Proposed Transaction. Thus, Defendants Gardner and Traub’s involvement in the sale process, in particular, allowed them to pursue personally satisfying financial outcomes as a result of the Proposed Transaction.

The Unreasonable Deal Protection Provisions

132. In addition, as part of the Merger Agreement, despite the inadequate consideration, Defendants agreed to certain terms that may inhibit other bidders from coming forward with a superior offer.

133. Section 7.3(a) of the Merger Agreement contains a “go-shop” provision which allowed the Company to solicit other acquisition proposals until April 7, 2015. Even if the Company were to accept a superior proposal during the go-shop period, however, the competing bidder would still need to compensate for a termination fee of (i) $6.8 million if the agreement is entered into three (3) full business days prior to the initial expiration date of the Tender Offer, or (ii) $13.6 million if such termination occurs thereafter. This provision significantly waters down the positive effect of a go-shop window, as any potential suitor will have to pay a substantial termination fee in addition to any additional consideration, inuring instead to the benefit of Microsemi and not the Company’s stockholders.

134. Following the go-shop period, 7.3(b) of the Merger Agreement includes a “no solicitation” provision barring the Company from soliciting interest from other potential acquirers in order to procure a price in excess of the amount offered by Microsemi. This section requires that the Company terminate any and all discussions with other potential acquirers.

135. Pursuant to Section 7.3(c) of the Merger Agreement, should an unsolicited bidder submit a competing proposal, the Company must notify Microsemi of the bidder’s identity and the terms of the bidder’s offer and grant Microsemi four (4) business days to negotiate with the Company to amend the Merger Agreement so that the third party’s proposal is no longer a superior offer. Additionally, if the Company thereafter agrees to enter into the superior acquisition proposal with the other bidder, Microsemi will be provided with the written agreement and concomitant terms and conditions of the superior offer and have an additional three (3) business days with which to negotiate with the Company and amend the Merger Agreement.

136. Section 9.3 of the Merger Agreement also provides that a termination fee of $13.6 million must be paid to Microsemi by Vitesse if the Company decides to pursue a competing offer after the expiration of the go-shop period.

137. Ultimately, the Board may only terminate the Merger Agreement, pursuant to its terms, in response to a superior offer after conducting an onerous and time consuming process, which substantially prejudices any potential topping bidder (and the Company’s stockholders) given the short amount of time anticipated between the announcement of the Proposed Transaction and the anticipated close of the Tender Offer. The restrictions imposed by the above requirements are unreasonable.

138. Lastly, concurrently with the execution of the Merger Agreement, the Individual Defendants and Raging Capital entered into the Support Agreement with Microsemi and Merger Sub. The parties to the Support Agreement own approximately 22% of the Company’s outstanding common stock as of the date of the Merger Agreement. The Support Agreement provides that all of the Individual Defendants and Raging Capital have agreed to vote to tender their shares of Company common stock in favor of the Proposed Transaction, take certain other actions in furtherance of the Proposed Transaction, and to not vote any of their shares in favor of an alternative acquisition proposal from a third party bidder.

The Individual Defendants’ Self-Dealing and Self-

Interest in the Proposed Transaction

139. Compounding their breaches of fiduciary duties, the Individual Defendants are to profit substantially from the Proposed Transaction. The executive officers of the Company and the Individual Defendants and their affiliates, including Raging Capital, will own approximately 15,691,265 shares as of April 28, 2015. As all of these shares must be tendered for purchase pursuant the Support Agreement, and assuming these shares will be accepted for payment and purchased by Microsemi, then the directors and officers and their affiliates would receive over $82 million in cash.

140. Further, two members of the Committee, Defendants Martin and Traub, are affiliated with Raging Capital. Traub, Chairman of the Committee, was a nominee for election to the Board by Raging Capital. Defendant Martin is Raging Capital’s chairman and also served on the Committee.

141. The following table sets forth the amount of cash consideration each executive officer and director and Raging Capital will receive when they tender their shares and the shares are accepted for payment and purchase by Microsemi:


	Number of Shares Owned		Value of Shares Owned
Executive Officers:
Christopher R. Gardner		487,074	2,571,751	$
Martin S. McDermut		226,385	1,195,313
Martin C. Nuss		134,241	708,792

Non-Employee Directors:
Matthew B. Frey		21,709	114,624
Steven P. Hanson		86,420	456,298
James H. Hugar		101,956	538,328
Scot B. Jarvis		98,088	517,905
William C. Martin		—
Edward Rogas, Jr.		102,356	540,440
Kenneth H. Traub ⁽¹⁾		111,909	590,880

Others:
Raging Capital Master Fund, Ltd. ⁽¹⁾		14,321,127	75,615,551


Total		15,691,265	$82,849,879

(1)

Mr. Traub was nominated for election to the Company’s Board of Directors at the 2013 Annual Meeting of the Company’s stockholders at the request of Raging Capital Fund, LP, the predecessor in-interest of Raging Capital Master Fund, Ltd. As part of the consideration for his agreement to be named as a nominee of Raging Capital for election as a director of the Company in 2012, Mr. Traub will be entitled to receive a payment after the consummation of the Transactions of an amount equal to 7.5% of any actual net profits realized by Raging Capital with respect to its investment in Vitesse’s securities based on a per share cost basis equal to the closing market price of Vitesse’s Shares on December 31, 2014, so long as Mr. Traub remains a director of the Company until the Transactions are consummated. Net profits, as defined in Mr. Traub’s letter agreement with Raging Capital Management, LLC, means all realized or unrealized gains, as applicable, with respect to Raging Capital’s investment in Vitesse’s securities for the applicable period, less (i) all realized or unrealized losses, as applicable, with respect to such securities for the applicable period, (ii) any and all out of pocket fees and expenses incurred of any kind and nature related to Raging Capital’s investment in such securities, and (iii) any positive or negative hedge allocation with respect to such securities for the applicable period.

142. Additionally, the Compensation Committee approved other self-serving terms for the entire Board just before entering into the Merger Agreement that provide the Board with unique, unearned benefits at the expense of Vitesse’s stockholders.

143. As provided in the Recommendation Statement, all Company RSUs held by Vitesse’s non-employee directors immediately prior to the Effective Time will be accelerated to vest as a result of the Proposed Transaction. Notably, the Individual Defendants eligible for such acceleration under the Compensatory Agreements are set to receive over $630,000 from their unvested RSUs that will vest as a result of the Proposed Transaction.

144. Further, the following table sets forth the number of shares underlying RSUs that are held by the Company’s directors, as of March 27, 2015, and the cash consideration that each of them may become entitled to receive in respect of those RSUs:


Name	Number of Shares Underlying RSUs		Aggregate Proceeds($)
Non-Employee Directors:
Matthew B. Frey		21,166		111,757
Steven P. Hanson		16,500		87,120
James H. Hugar		16,500		87,120
Scot B. Jarvis		28,195		148,870
William C. Martin		—		—
Edward Rogas, Jr.		16,500		87,120
Kenneth H. Traub		21,166		111,757

145. Lastly, assuming the change-in-control occurs on April 27, 2015, Defendant Gardner stands to receive over $3.9 million under the terms of his respective employment agreement.

146. Although the Recommendation Statement provides that no member of the Company’s management has entered into an employment agreement with Microsemi thus far, this disclosure is inadequate as it does not address whether there have been any discussions with regard to retaining Company management.

147. As demonstrated in the tables above, the Individual Defendants and executive officers involved in the negotiation of the Proposed Transaction, as well as Raging Capital, stand to reap of millions of dollars as a result of the Proposed Transaction.

The Recommendation Statement Omits/Misstates Material Information

148. On March 31, 2015, Defendants filed the Recommendation Statement in connection with the Proposed Transaction, which contains numerous material misstatements and omissions. For example, the Recommendation Statement fails to include material information concerning: (a) the background of the Proposed Transaction; (b) the key data and inputs underlying the financial valuation analyses that purport to support the so-called fairness opinions provided by Deutsche Bank; and (c) key financial projections for the Company.

Omissions Concerning the Background of the Proposed Transaction

149. The Recommendation Statement fails to disclose material information relating to, among other things, the process leading up to the Proposed Transaction, including the following:

The identity of the six members of the original Committee formed in October 2011;

Whether the NDAs entered into with Company A on February 22, 2013 and the 11 parties (including Company A) from January through February 2015 contained standstill provisions;

The steps the Board determined to take in March 2013 to increase the likelihood that other potential acquirors would be in a position to bid for the Company should Company A make public its efforts to acquire Vitesse;

Whether the Committee had discussions amongst themselves or with Defendant Martin prior to August 13, 2014 about the prospect of him joining the Board;

The Board’s basis for (i) the reconstitution of the Committee on October 1, 2014 and (ii) the appointment of Defendants Hanson, Martin, and Traub as members of the Committee;

The employees identified by Defendant Gardner and the basis for their selection to be eligible for success and transition bonuses in connection with an acquisition as approved by the Compensation Committee on October 1, 2014;

The Board’s basis for engaging Deutsche Bank as financial advisor in addition to Needham;

The details of the modification to the success fee payable to Needham upon closing of a strategic transaction;

The number of potentially interested parties identified (including the number of strategic versus financial buyers);

The details of the possible product synergies between Vitesse and Microsemi addressed in Defendant Gardner’s email on February 11, 2015;

The Board’s basis for authorizing Deutsche Bank to contact two additional strategic parties on February 12, 2015 and the details of the “competitive reasons” that precluded the Board from approaching these two parties previously;

The Compensation Committee’s basis for approving (i) the $1 million bonus payments program on October 1, 2014, (ii) the extension on February 26, 2015 of the term of change-in-control agreements for certain Company employees until February 2016, and (iii) the Compensatory Agreements on March 16, 2015;

Details surrounding the go-shop process, including parties contacted and the extent of any communications concerning a potential transaction involving Vitesse; and

Details of the nature, substance, and timing of any discussions between the Company and Microsemi regarding management retention.

150. Additionally, the Recommendation Statement discloses that the Company executed 11 NDAs with parties besides Microsemi, but fails to disclose whether such NDAs contained standstill provisions as the NDA with Microsemi included a standstill provision.

The Recommendation Statement Omits Material

Information Concerning Deutsche Bank’s Analyses

151. Regarding the analyses conducted by Deutsche Bank, the Recommendation Statement fails to disclose material underlying inputs and assumptions necessary for stockholders to have a fair summary of these analyses that support the fairness opinion, including:

A valuation summary detailing (i) the calculation of fully diluted shares; (ii) the calculation of equity value (at the unaffected price and the offer); (iii) the calculation of enterprise value (at the unaffected price and the offer); and (iv) whether pricing multiples were calculated.

With respect to the Selected Public Companies Analysis: (i) the objective selection criteria; (ii) the observed company-by-company pricing multiples and financial metrics; (iii) whether Deutsche Bank examined other multiples, including, but not limited to EBITDA, which is customary for companies such Vitesse; (iv) the identities of the “selected equity research analysts” and the bases for their selections; (v) the number of multiples disregarded as not meaningful because they were negative; (vi) the number of multiples disregarded as not meaningful because they were in excess of 30x; and (vii) the basis for the low range of selected multiples relative to observed peer company multiples;

With respect to the Selected Precedent Transaction Analysis: (i) the objective selection criteria; (ii) the observed transaction-by-transaction enterprise values, pricing multiples, and financial metrics; (iii) whether Deutsche Bank examined other multiples, including, but not limited to P/E multiples, and/or transaction premiums; and (iv) whether forward multiples were available for all transactions;

With respect to the Discounted Cash Flow Analysis: (i) the definition of unlevered, after-tax free cash flows; (ii) the implied pricing multiples corresponding to the assumed growth rates; (iii) whether the discount rate range of 13% to 17% is based upon the weighted average cost of capital or cost of equity; (iv) and the identity and source of the discount rate assumptions and how the discount rates were quantified; and

With respect to the Premiums Paid Analysis, the basis for considering and selecting negative premiums in light of the assertion that, “Negative premiums and premiums above 200% were considered not meaningful[;]” and

With respect to Additional Information, the identity and source of the assumptions underlying the estimated cost of equity and how it was quantified.

The Recommendation Statement Omits Key

Financial Projections Prepared by Vitesse

152. The Recommendation Statement also omits material information regarding the financial projections provided by Vitesse management and relied upon by Deutsche Bank, for fiscal years 2015-2019, including the basis for including a 3-month stub period at the end of the forecast period.

153. The Recommendation Statement also omits the following line items from the financial projections for fiscal years 2015-2019:

Earnings Per Share;

Net operating loss carry-forward balances and utilization;

Synergies;

All line items for the stub period consisting of the second through fourth quarters for fiscal year 2015; and

What constitutes “Other” in the line item “Capital Expenditures and Other.”

154. Accordingly, Plaintiff seeks injunctive and other equitable relief to prevent the irreparable injury that Company stockholders will continue to suffer absent judicial intervention.

FIRST CAUSE OF ACTION

FOR BREACH OF FIDUCIARY DUTIES

(On Behalf of Plaintiff and the Class and

Against the Individual Defendants)

155. Plaintiff repeats and realleges each allegation set forth herein.

156. The Individual Defendants have violated fiduciary duties of disclosure, care, loyalty and good faith owed to public stockholders of Vitesse.

157. By the acts, transactions and courses of conduct alleged herein, the Individual Defendants are acting as part of a common plan and are attempting to unfairly deprive Plaintiff and other members of the Class of the true value of their investment in Vitesse.

158. As demonstrated by the allegations above, the Individual Defendants failed to exercise the care required, and breached their duties of loyalty, good faith and due care owed to the stockholders of Vitesse because, among other reasons:

They agreed to the Proposed Transaction for inadequate consideration;

They failed to properly value Vitesse;

They agreed to deal protection provisions that may inhibit other bidders from coming forward with a superior offer and that may have negative consequences for Vitesse; and

They failed to disclose material information to Vitesse stockholders in connection with the Proposed Transaction.

159. The Individual Defendants dominate and control the business and corporate affairs of Vitesse, and are in possession of private corporate information concerning Vitesse assets, business and future prospects. Thus, there exists an imbalance and disparity of knowledge and economic power between them and the public stockholders of Vitesse which make it inherently unfair for them to benefit their own interests to the exclusion of maximizing stockholder value.

160. By reason of the foregoing acts, practices and course of conduct, the Individual Defendants have failed to exercise due care and diligence in the exercise of their fiduciary obligations toward Plaintiff and the other members of the Class.

161. As a result of the actions of the Individual Defendants, Plaintiff and the Class will suffer irreparable injury in that they have not and will not receive their fair portion of the value of Vitesse assets and businesses and have been and will be prevented from obtaining a fair price for their common stock.

162. Unless the Individual Defendants are enjoined by the Court, they will continue to breach their fiduciary duties owed to Plaintiff and the members of the Class, all to the irreparable harm of the members of the Class.

163. Plaintiff and the members of the Class have no adequate remedy at law. Only through the exercise of this Court’s equitable powers can Plaintiff and the Class be fully protected from the immediate and irreparable injury which Defendants’ actions threaten to inflict.

SECOND CAUSE OF ACTION

FOR AIDING AND ABETTING THE INDIVIDUAL

DEFENDANTS BREACHES OF FIDUCIARY DUTIES

(On Behalf of Plaintiff and the Class

Against Defendant Microsemi and Merger Sub)

164. Plaintiff incorporates by reference and realleges each and every allegation contained above, as though fully set forth herein.

165. Microsemi and Merger Sub knowingly aided and abetted the Individual Defendants’ wrongdoing alleged herein. Microsemi and Merger Sub are active and necessary participants in the Individual Defendants’ plan to complete the Proposed Transaction on terms that are unfair to Vitesse

stockholders. In addition, Microsemi and Merger Sub further aided and abetted the Individual Defendants breaches of fiduciary duty by causing the Individual Defendants to enter into Support Agreements, providing that the Individual Defendants will vote for the Proposed Transaction and against any alternative transaction in exchange for lucrative change-in-control compensation.

166. As a result of the conduct by Microsemi and Merger Sub, Plaintiff and the other members of the Class have and will be damaged by being denied the best opportunity to maximize the value of their investments in Vitesse.

167. Plaintiff and the members of the Class have no adequate remedy at law. Only through the exercise of this Court’s equitable powers can Plaintiff and the Class be fully protected from the immediate and irreparable injury which Defendants’ actions threaten to inflict.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff demands injunctive relief in his favor and in favor of the Class and against Defendants as follows:

A. Declaring that this action is properly maintainable as a Class Action and certifying Plaintiff as Lead Plaintiff and his counsel as Lead Counsel;

B. Enjoining Defendants, their agents, counsel employees and all persons acting in concert with them from consummating the Proposed Transaction, unless and until the Company adopts and implements a procedure or process to obtain a merger agreement providing the best possible terms for stockholders and discloses all material information to stockholders before the Tender Offer closes;

C. Rescinding, to the extent already implemented, the Proposed Transaction or any of the terms thereof, or granting Plaintiff and the Class rescissory damages;

D. Directing the Individual Defendants to exercise their fiduciary duties to commence a sale process that is reasonably designed to secure the best possibility consideration for Vitesse and obtain a transaction, which is in the best interests of Vitesse stockholders; and

E. Directing that Defendants account to Plaintiff and the other members of the Class for all damages caused by them and account for all profits and any special benefits obtained as a result of their breaches of their fiduciary duties;

F. Awarding Plaintiff the costs and disbursements of this action, including reasonable attorneys’ and experts’ fees; and granting such other and further equitable relief as the Court may deem just and proper.


Dated: April 8, 2015 Of Counsel: WOLF HALDENSTEIN ADLER FREEMAN & HERZ LLP Gregory M. Nespole Benjamin Y. Kaufman 270 Madison Avenue New York, NY 10016 Tel.: (212) 545-4600 Fax: (212) 545-4653 RYAN & MANISKAS LLP Richard A. Maniskas 995 Old Eagle School Rd., Suite 311 Wayne PA 19087 Tel.: (484)-588-5516 Fax: (484)450-2582		ANDREWS & SPRINGER, LLC By: /s/ Peter B. Andrews Peter B. Andrews (# 4623) Craig J. Springer (# 5529) 3801 Kennett Pike Building C, Suite 305 Wilmington, DE 19807 Tel.: (302) 504-4957 Fax: (302) 397-2681 Counsel for Plaintiff Mark Durbin

















Counsel for Plaintiff Mark Durbin

LOGO

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE


MERRILL DAVIDOFF,	)
	)
Plaintiff,	)
	)
v.	)
	)
VITESSE SEMICONDUCTOR	)	Civil Action No.
CORP., CHRISTOPHER R.	)
GARDNER, EDWARD ROGAS JR.	)
MATTHEW B. FREY, STEVE P.	)
HANSON, JAMES H. HUGAR,	)
SCOT JARVIS, WILLIAM C.	)
MARTIN, KENNETH H. TRAUB,	)
MICROSEMI CORP., and LLIU 100	)
ACQUISITION CORP.,	)
	)
Defendants.	)
	)
	)

VERIFIED CLASS ACTION COMPLAINT

Plaintiff Merrill Davidoff (“Plaintiff”), by his undersigned attorneys, for this Verified Class Action Complaint, alleges upon personal knowledge with respect to himself, and upon information and belief based upon, inter alia, the investigation of counsel as to all other allegations herein, as follows:

NATURE OF THE ACTION

1. Plaintiff brings this stockholder class action on behalf of himself and all other public stockholders of Vitesse Semiconductor Corporation (“Vitesse” or the “Company”), other than Defendants (defined herein) and their immediate

family members and affiliates, against Vitesse and its Board of Directors (the “Board” or the “Individual Defendants”), for violations of fiduciary duties and against Microsemi Corporation (“Parent”) and its wholly owned subsidiary LLIU 100 Acquisition Corporation (“Merger Sub,” and together with Parent, “Microsemi”) for aiding and abetting the same. Through this action, Plaintiff seeks to enjoin a proposed transaction announced on March 18, 2015, pursuant to which Vitesse will be acquired by Microsemi.

2. On March 17, 2015, the Board caused Vitesse to enter into an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which Microsemi, through Merger Sub, will commence a tender offer (the “Tender Offer”) to acquire all of the outstanding shares of Vitesse for $5.28 per share in cash (the “Proposed Transaction”). Under the terms of the Merger Agreement, Merger Sub will be merged with and into the Company and the Company will become a wholly owned subsidiary of Microsemi. The Proposed Transaction is valued at approximately $389 million.

3. On March 31, 2015, the Company filed with the Securities and Exchange Commission (the “SEC”) a Solicitation/Recommendation Statement on Form SC 14D9 (the “Recommendation Statement”) purportedly to inform its stockholders about the terms of the Proposed Transaction, the Tender Offer, and the negotiations thereof. The Recommendation Statement was filed the same day

the Company filed a Schedule TO on Form SC TO-T with the SEC to announce the start of the Tender Offer period. The Tender Offer period expires on April 27, 2015.

4. As alleged herein, the Proposed Transaction is the result of a fundamentally flawed process and deprives Vitesse’s public stockholders of the ability to participate in the Company’s long-term prospects. The Board has breached its fiduciary duties by failing to maximize stockholder value and by agreeing to preclusive deal protection devices designed to prevent another bidder from emerging with a superior offer.

5. Moreover, the Recommendation Statement omits material information concerning both the negotiation process leading to the Proposed Transaction and the valuation of Vitesse. Without remedying the material omissions prior to the close of the Tender Offer period, the Board is asking Vitesse stockholders to make a material decision concerning their ownership of Vitesse without the critical information necessary to make a fully informed decision. The material omissions in the Recommendation Statement are critical to the general mix of information available to Vitesse stockholders.

6. Rather than undertake a full and fair process to maximize stockholder value as their fiduciary duties require, the Board agreed to a twenty-one day “go-shop” period that allows the Company to solicit superior proposals, which expired

on April 7, 2015. In light of the other preclusive deal protections in the Merger Agreement, the go-shop provision appeared to be illusory. In addition to being an insufficient amount of time for a potential bidder to conduct due diligence and make an informed offer, even if the Company were to receive and accept a superior bid, the topping bidder would still be required to pay a termination fee of up to $13.6 million in addition to any additional consideration, representing a substantial naked premium as compared to the price paid by Microsemi.

7. Unsurprisingly, none of the twenty-eight potential acquirors contacted during the go-shop period submitted a superior proposal, and the Company is now subject to a strict “no-solicitation” provision that prohibits the Company from soliciting other potential acquirers or from continuing existing discussions with potential acquirors. The deal protection devices in the Merger Agreement unreasonably inhibit the Board’s ability to act with respect to investigating and pursuing superior proposals and alternatives, including a sale of all or part of Vitesse.

8. Moreover, the process was riddled with conflicts of interest, as the Individual Defendants engaged in self-dealing and obtained benefits for themselves not shared with Vitesse’s public stockholders. In conjunction with the execution of the Merger Agreement, the Individual Defendants and the Company’s largest stockholder, Raging Capital Master Fund, Ltd. (“Raging Capital”) (the “Major

Stockholders”), entered into a tender and support agreement (the “Support Agreement”) with Microsemi. The Support Agreement provides that the Major Stockholders, who collectively owned approximately 22% of the Company’s outstanding common stock as of the date of the Merger Agreement, must tender their shares of Company common stock in favor of the Proposed Transaction, take certain other actions in furtherance of the Proposed Transaction, and not vote any of their shares in favor of an alternative acquisition proposal from a third party bidder.

9. It appears that Raging Capital had been looking to liquidate its current 20.9% stake in Vitesse, and its two designees on the Board ultimately served on the Strategic Advisory Committee (the “Committee”) that negotiated the Proposed Transaction. In total, the Company’s executives, the Board, and Raging Capital stand to receive over $82 million from tendering their shares in favor of the Proposed Transaction (of that total amount, Raging Capital is set to receive over $75 million). Christopher R. Gardner (“Gardner”), the Company’s Chief Executive Officer (“CEO”) and a director, is set to receive over $3.9 million in connection with the Proposed Transaction. After the Board approved the Merger Agreement, Vitesse’s Compensation Committee approved the accelerated vesting of restricted stock units (“RSUs”) held by non-employee directors effective immediately prior to the merger. This action put certain Individual Defendants in a position to receive over $630,000 collectively in financial benefits.

10. Absent judicial intervention, the Proposed Transaction will be consummated, resulting in irreparable injury to Plaintiff and Vitesse’s other public stockholders, who will not receive the highest value available for their stock.

11. Plaintiff seeks to enjoin, preliminarily and permanently, the Proposed Transaction and, in the event the Proposed Transaction is consummated, recover damages as a result of the violations of law alleged herein.

PARTIES

12. Plaintiff is, and at all relevant times has been, a Vitesse stockholder.

13. Defendant Vitesse is a Delaware corporation and maintains its principal executive offices at 4721 Calle Carga, Camarillo, California 93012. Vitesse designs, develops, and markets various semiconductor products for carrier and enterprise networking applications worldwide. Vitesse’s common stock is traded on the NASDAQ under the ticker “VTSS.”

14. Defendant Gardner has served as the Company’s CEO since May 2006 and as a member of the Board since October 2006. Gardner entered into the Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

15. Defendant Edward Rogas Jr. (“Rogas”) has served as a director and Chairman of the Board since 2006. Rogas is a member of the Audit Committee and the Nominating and Governance Committee. Rogas entered into the Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

16. Defendant Matthew B. Frey (“Frey”) has served as a director of the Company since March 2013. Frey is a member of the Nominating and Governance Committee. Frey entered into the Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

17. Defendant Steve P. Hanson (“Hanson”) has served as a director of the Company since August 2007. Hanson is the Chair of the Nominating and Governance Committee. Hanson entered into the Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

18. Defendant James H. Hugar (“Hugar”) has served as a director of the Company since October 2009. Hugar is the Chair of the Audit Committee and a member of the Compensation Committee. Hugar entered into the Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

19. Defendant Scot Jarvis (“Jarvis”) has served as a director of the Company since May 2012. Jarvis is Chair of the Compensation Committee and a member of the Audit Committee. Jarvis entered into the Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction.

20. Defendant William C. Martin (“Martin”) has served as a director of the Company since August 2014. Martin is a member of the Nominating and Governance Committee. Martin entered into the Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction. In addition, Martin is the chairman and Chief Investment Officer of Raging Capital, which has also entered into the Support Agreement and is the Company’s largest stockholder.

21. Defendant Kenneth H. Traub (“Traub”) has served as a director of the Company since March 2013. Traub is a member of the Compensation Committee. Traub entered into the Support Agreement to tender all of the shares he owns or controls in favor of the Proposed Transaction. Traub was nominated to the Board by Raging Capital.

22. Defendants Gardner, Rogas, Frey, Hanson, Hugar, Jarvis, Martin, and Traub are collectively referred to as the “Individual Defendants.”

23. The Individual Defendants, by virtue of their positions as directors and/or officers of Vitesse, owe fiduciary duties to Plaintiff and the other public stockholders of Vitesse. Each of the Individual Defendants at all relevant times had the power to control and direct Vitesse to engage in the misconduct alleged herein. The Individual Defendants’ fiduciary obligations require them to act in the best interest of Plaintiff and all Vitesse stockholders.

24. As alleged herein, the Individual Defendants, separately and together, in connection with the Proposed Transaction, violated, and are continuing to violate, the fiduciary duties they owe to Plaintiff and the Company’s other public stockholders, due to the fact that they have failed to maximize stockholder value in a proposed sale of the Company.

25. Defendant Parent is a Delaware corporation with its headquarters located at One Enterprise, Aliso Viejo, California 92656. Parent designs, manufactures, and markets analog and mixed-signal semiconductor solutions in the United States, Europe, and Asia. Parent’s stock is traded on the NASDAQ under the ticker “MSCC.”

26. Defendant Merger Sub is a Delaware corporation and wholly owned subsidiary of Microsemi that was created for the purposes of effectuating the Proposed Transaction.

27. Collectively, Vitesse, the Individual Defendants, Parent, and Merger Sub are referred to herein as the “Defendants.”

CLASS ACTION ALLEGATIONS

28. Plaintiff brings this action as a class action, pursuant to Court of Chancery Rule 23, on behalf of all holders of Vitesse common stock who are being

and will be harmed by Defendants’ actions as described herein (the “Class”). Excluded from the Class are Defendants and any person, firm, trust, corporation, or other entity related to or affiliated with any Defendant.

29. This action is properly maintainable as a class action.

30. The Class is so numerous that joinder of all members is impracticable. According to the Merger Agreement, as of March 13, 2015, the Company had 69,210,370 shares of outstanding common stock, held by hundreds, if not thousands, of individuals and entities geographically dispersed throughout the country.

31. There are questions of law and fact that are common to the Class, including, inter alia, whether: (i) the Individual Defendants have and are breaching their fiduciary duties owed to Plaintiff and the Class; and (ii) the Class has been irreparably damaged by Defendants’ conduct complained of herein.

32. Plaintiff’s claims are typical of the claims of the Class. Plaintiff and the Class have and will sustain damages arising out of Defendants’ breaches of their fiduciary duties. Plaintiff does not have any interests that are adverse or antagonistic to those of the Class. Plaintiff will fairly and adequately protect the interests of the Class. Plaintiff is committed to the vigorous prosecution of this action and has retained counsel competent and experienced in this type of litigation. Accordingly, Plaintiff is an adequate representative of the Class and will fairly and adequately protect the interests of the Class.

33. The prosecution of separate actions by individual members of the Class would create the risk of inconsistent or varying adjudications with respect to individual members of the Class that would establish incompatible standards of conduct for Defendants, or adjudications with respect to individual members of the Class that would, as a practical matter, be dispositive of the interests of the other Class members who are not parties to the adjudications or would substantially impair or impede those non-party Class members’ ability to protect their interests.

34. Defendants have acted, or refused to act, on grounds generally applicable, and are causing injury, to the Class as a whole. Therefore final injunctive relief on behalf of the Class as a whole is appropriate.

SUBSTANTIVE ALLEGATIONS

Company Background

35. Vitesse was founded in 1984 and is headquartered in Camarillo, California.

36. According to the Company’s website, Vitesse is a fabless supplier of high-performance integrated circuits (“ICs”), application software, and integrated turnkey systems solutions used primarily in Carrier, Enterprise, and industrial Internet of Things (“loT”) network applications. Vitesse has historically focused on both Carrier and Enterprise networking, selling into many of the leading original equipment managers (“OEMs”) that service these markets.

37. Today, Vitesse is a leading supplier of ICs for next-generation Ethernet-based Carrier, Enterprise, and loT networks worldwide. The Company designs, develops, and markets a diverse portfolio of high-performance, feature-rich, low-power and cost-competitive Ethernet networking and connectivity IC solutions, associated applications and protocol software.

The Company is Poised for Growth

38. The Company has been growing rapidly in the last few years. In fiscal year 2014, the Company reported $1.14 billion in revenue. In fact, its revenue has doubled in the last five years.

39. In an August 5, 2014 press release announcing the Company’s third quarter fiscal year 2014 results, Vitesse CEO, Gardner, commenting on the Company’s strong performance, stated:

Our recent performance has increased our confidence that Vitesse is well-positioned for significant and sustained long-term revenue growth and profitability. New product revenue momentum continues, growing 21% sequentially and 79% over the year ago quarter, and now comprises over 50% of total revenue. The inflection point in our business is now clearly evident, as the growth of our new product portfolio again outstripped the decline of our legacy business, resulting in total revenue growth of 6% sequentially and 3% from the year ago quarter . . . . At the same time, we have substantially strengthened our balance sheet, positioning us to retire all of our near-term debt and further our growth initiatives. Vitesse now has the infrastructure and the resources to support a much larger base of customers. Coupled with our substantial operating leverage, margins on our future growth will flow to the bottom line.

The markets are validating our technology focus and strategy. Today, we see Ethernet virtually everywhere, creating opportunities for Vitesse in areas such as Gigabit Wi-Fi, loT, storage, and automotive. Because our new Ethernet product portfolio can serve these markets now, we are adding new customers at an accelerating pace while increasing opportunities and design wins with existing customers.

40. In 2014, Vitesse decided to focus on Ethernet, reasoning that Ethernet would become the dominant networking technology for the next decade and launched its “Ethernet Everywhere” strategy. This strategy paid off as Vitesse achieved a non-GAAP operating profit of $1 million for the fourth quarter of 2014. In a December 4, 2014 press release announcing the Company’s fourth quarter and fiscal year 2014 results, Gardner touted the Company’s results:

We are very pleased with the success of Vitesse’s “Ethernet Everywhere” strategy and our execution is increasingly evident as demonstrated by our revenue growth, the upward trend in gross margins, design win success, and now, achieving non-GAAP operating profitability.

In 2014, design wins for our new products reached record highs. Major wins in Carrier and Enterprise continued accumulating steadily, while those in emerging markets, such as Industrial-loT and Storage, accelerated dramatically. loT experienced a 200% increase in design wins in the year, now representing 37% of the total. loT was also a major contributor to our 130 new customers in the year. We believe this growth in loT will continue as the need to network all things escalates, expanding our served market by nearly $400 million. This market provides multiple avenues to create substantial revenue growth and literally transform Vitesse. Accordingly, we have updated our reporting structure to breakout our loT business as a third core market.

also achieved a financial milestone by eliminating the dilution overhang with the repayment of our convertible debentures. While our legacy business has declined over the past several years, our new business is growing rapidly. We are increasingly confident that this growth, combined with strengthening gross margins, the high degree of operating leverage in our business, and our improved balance sheet, will generate significant shareholder value.

41. In the February 3, 2015 press release announcing the Company’s first quarter fiscal year 2015 results, Vitesse continued to report successful results. Commenting on the results, Gardner stated:

New product revenue continues on a solid trajectory reaching $16.2 million in the quarter, up 82% on a year to year basis. New products now represent 68% of our total product revenue . . . . Our customer profile continues to grow and evolve as our position strengthens in new, adjacent markets such as IoT and storage, which are literally reshaping our business and expanding our market opportunity. Our expanded sales team dramatically increased both opportunities and design wins, more than doubling the number of new customers in the pipeline, setting us on pace for another record year. As Ethernet propagates into new markets, our total addressable market will triple from approximately $1 billion today to over $3 billion by 2020.

As anticipated, we saw a meaningful decrease in revenue from our legacy products in the first quarter and expect another smaller decline in the second quarter. These declines will be more than offset by new product revenue growth of 50% to 75% for the full fiscal year. We continue to manage expenses carefully as we move through the transition and remain on target to deliver gross product margins of 60% in fiscal year 2015. All told, the leading indicators of our business are strong and we are well positioned with the technology, products, market position, and customers to capitalize on the exciting growth opportunities we are seeing in the market.

The Flawed Process

42. In October 2011, the Board formed the Committee to explore potential transactions that would be reasonably likely to enhance stockholder value and that would reduce Vitesse’s substantial indebtedness that would begin to mature in February 2014.

43. In 2012, Vitesse engaged Needham & Company, LLC (“Needham”) to act as sole book-running manager to Vitesse in connection with a proposed public offering, and also engaged Needham as its exclusive financial advisor in connection with a strategic transaction.

44. Pursuant to this engagement, Vitesse commenced its first public offering on December 6, 2012, with Needham acting as sole book-running manager, raising net proceeds of approximately $18.8 million.

45. Needham also advised the Committee and the Board with respect to unsolicited inquiries from companies interested in exploring a possible transaction with Vitesse, including several proposals received from Microsemi beginning in 2013.

46. In late 2012, Company A contacted the Board regarding a possible strategic transaction. On December 17, 2012, Company A submitted a non-binding proposal to acquire Vitesse for cash consideration of $2.50 to $3.00 per share. On January 9, 2012, Company A increased its proposed purchase price to

$2.75 to $3.25 per share. Vitesse entered into a non-disclosure agreement (“NDA”) with Company A on February 22, 2012, and on March 7, 2013, Company A fixed its proposed purchase price at $3.05 per share and requested exclusivity to negotiate a transaction.

47. On March 7, 2013, the Board, apparently without input from Needham, determined not to continue discussions with Company A unless it increased its offer price. Company A declined to increase its offer price and indicated it would not continue to pursue a transaction with Vitesse.

48. Concerned that Company A may make its efforts to acquire Vitesse public, the Board authorized management to meet with other potential acquirors and take other steps to increase the likelihood that other potential acquirors would be in a position to bid. From these efforts, Microsemi and another unnamed company expressed interest in a possible transaction.

49. On March 13, 2013, Vitesse and Microsemi entered into a NDA which contained an eighteen month standstill provision expiring on September 13, 2014.

50. On April 17, 2013, Company B submitted a non-binding proposal to acquire Vitesse for cash consideration of $3.25 to $3.50 per share, and requested exclusivity to negotiate a deal.

51. On May 15, 2013, Microsemi submitted a non-binding proposal to acquire Vitesse for cash consideration of $2.80 per share and requested exclusivity to negotiate a deal.

52. The Board, without input from Needham, informed Company B and Microsemi that Vitesse was not interested in pursuing a sale transaction.

53. On June 19, 2013, Vitesse commenced a second public offering of its common stock with Needham acting as the sole book-running manager, raising net proceeds of approximately $37.5 million.

54. On May 19, 2014, Microsemi submitted a second non-binding proposal to acquire Vitesse for cash consideration of $4.00 per share and again requested exclusivity to negotiate a transaction.

55. On May 21, 2014, the Committee met to consider Microsemi’s latest proposal, with Needham and Vitesse’s counsel present. The Committee asked Needham to prepare a comprehensive valuation analysis to assist the Committee in evaluating Microsemi’s proposal.

56. On May 29, 2014, the Committee concluded that pursuing a possible sale transaction at Microsemi’s proposed price would likely preclude the Company from raising capital during the negotiations. Upon the Committee’s advice, the Board authorized management to continue with its capital raising plans and pursue a public offering of Vitesse’s common stock, and Microsemi was informed the same day that the Company was not interested in pursuing a sale.

57. On June 11, 2014, Vitesse commenced a public offering of its common stock with Needham acting as the sole book-running agent, raising net proceeds of approximately $26.7 million. Raging Capital, the Company’s largest stockholder, purchased 1.6 million shares in this offering, raising its stake in Vitesse to 14.3 million shares. Raging Capital currently owns approximately 21% of Vitesse’s outstanding shares.

58. From June 2014 through August 2014, Microsemi continued to express interest in acquiring Vitesse, with the chairman of the board and chief executives of Microsemi reaching out to Gardner, suggesting that Microsemi would consider increasing its offer if a higher value could be justified through management discussions and diligence. Vitesse continued to maintain that the Company was not for sale but expressed a willingness to continue discussions if Microsemi extended the standstill agreement set to expire on September 13, 2014.

59. On August 15, 2014, the Board unanimously resolved to expand the Board’s size from seven to eight members to appoint Martin of Raging Capital as a director. Martin’s appointment became effective on August 20, 2014.

60. As described in more detail below, soon after Martin joined the Board, certain measures were taken to increase the likelihood of the Company being acquired and to give Raging Capital more say over the process.

61. On September 5, 2014, Microsemi sent a letter to Vitesse reiterating its $4.00 per share cash offer, requesting to engage with Vitesse in discussions, and indicated a willingness to extend the standstill agreement by six months. Gardner sent an amendment to the NDA extending the standstill agreement by six months but Microsemi did not respond and the standstill expired on September 13, 2014.

62. On September 8, 2014, shortly after Martin joined the Board, the Committee resolved to initiate a process to seek third-party interest in an acquisition of Vitesse, and on October 1, 2014, Needham presented a list of potential buyers and an overview of transaction timing.

63. Also on October 1, 2014, the Committee was reconstituted in light of the decision to conduct a sale process. The Committee was reduced from six to three members to create a “smaller, more efficient working group,” with Martin and Traub, Raging Capital’s Board designees, appointed as two out of the three members. Traub was subsequently appointed as Chairman and was ultimately given authority to negotiate with Microsemi on the Company’s behalf.

64. In addition, the Compensation Committee approved up to $1 million in bonus payments to certain employees identified by Gardner (although Gardner

himself was ineligible) in connection with an acquisition of Vitesse and approved a new employment agreement for Gardner and Martin S. McDermut, the Company’s Chief Financial Officer, which provided for an increase in severance payments if termination occurred in connection with a change of control.

65. On October 31, 2014, Vitesse retained Deutsche Bank Securities Inc. (“Deutsche Bank”) to act as an additional financial advisor and modified the success fee payable to Needham upon the closing of a strategic transaction. In November and December 2014, Deutsche Bank made presentations to the Board and met with management to prepare for a sale process.

66. From January 5, 2015 through February 2015, twenty-seven potential buyers were contacted, including Company A, Company B, and Microsemi and Vitesse executed NDAs with eleven companies. Management conducted meetings with ten of these companies.

67. On January 26, 2015, Microsemi was advised of Vitesse’s sale process at a lunch between Gardner and James Peterson (“Peterson”), Chairman and CEO of Microsemi. On February 5, 2015, Microsemi and Vitesse amended their current NDA and extended the standstill provision until March 13, 2015.

68. On February 10, 2015, Microsemi submitted a non-binding proposal to acquire Vitesse for $4.75 per share in cash and requested exclusivity to negotiate a transaction. Gardner and Peterson communicated by email over the next few

days. Gardner informed Peterson that the Board would consider Microsemi’s proposal at a Board meeting on February 18, 2015, and Peterson indicated that Microsemi was pursuing another strategic transaction and needed a response from Vitesse as soon as possible.

69. From February 12, 2015 through February 18, 2015, Deutsche Bank informed the other potential acquirors that the Company’s sale process was concluding and that such parties should act quickly if they intended to make a proposal. No other proposals were received before February 18, 2015.

70. At the February 18, 2015 Board meeting, Deutsche Bank indicated that eight parties were still considering making a proposal, and the Board authorized Traub to negotiate a higher price and better terms from Microsemi.

71. On February 18, 2014, Microsemi delivered a revised indication of interest with a purchase price of $5.28 per share in cash, a twenty-day exclusivity period, a twenty-one day post announcement go-shop period, and an anticipated time to announce the transaction of six weeks or less.

72. On February 20, 2015, the Board was informed that four parties in addition to Microsemi were still evaluating whether to make a proposal to acquire Vitesse. Despite this, the Board determined to enter into exclusivity with Microsemi, which commenced on February 23, 2014.

73. On March 5, 2015, an unnamed party that had signed a NDA but was unable to schedule a management meeting previously requested additional information and a meeting. However, Vitesse could not engage with this party due to the exclusivity period with Microsemi and informed Microsemi of these communications pursuant to the exclusivity agreement.

74. On March 11, 2015, Traub met with representatives of Microsemi to discuss the open issues in the Merger Agreement and agreed to extend the exclusivity period until March 17, 2015.

75. On March 16, 2015, the Board unanimously approved the Proposed Transaction, and on March 17, 2015, Deutsche Bank delivered its fairness opinion and the Merger Agreement was executed.

76. The Board failed to run a fair process and appears to have favored Microsemi as a potential acquirer.

The Proposed Transaction

77. On March 18, 2015, Vitesse announced that it had entered into the Merger Agreement with Microsemi, pursuant to which Microsemi, through Merger Sub, will commence the Tender Offer to acquire all of the outstanding shares of Vitesse for a purchase price of $5.28 per share in cash. The press release provides, in pertinent part:

ALISO VIEJO, Calif. and CAMARILLO, Calif., March 18, 2015 /PRNewswire/ — Microsemi Corporation (MSCC), a leading provider of semiconductor solutions differentiated by power, security, reliability and performance, and Vitesse Semiconductor Corporation (VTSS), jointly announced today that Microsemi has entered into a definitive agreement to acquire Vitesse for $5.28 per share through a cash tender offer, representing a premium of 32 percent based on the average closing price of Vitesse’s shares of common stock during the 30 trading days ended March 17, 2015. The board of directors of Vitesse unanimously recommends that Vitesse’s stockholders tender their shares in the tender offer. The total transaction value is approximately $389 million.

Headquartered in Camarillo, California, Vitesse designs a diverse portfolio of high-performance semiconductors, application software, and integrated turnkey systems solutions for carrier, enterprise and Internet of Things (loT) networks worldwide. Vitesse’s products enable the fastest-growing network infrastructure markets including mobile access/IP edge, enterprise cloud access, and industrial-loT networking.

* * *

Tender Offer and Closing

Under the terms of the merger agreement, Vitesse may solicit superior proposals from third parties for a “go shop” period of 21 calendar days continuing through April 7, 2015. It is not anticipated that any developments will be disclosed with regard to this process unless and until Vitesse’s board of directors makes a decision to pursue a potential superior proposal. Deutsche Bank will assist Vitesse with its go shop process. There are no guarantees that this process will result in a superior proposal. The merger agreement provides Microsemi with a customary right to match a superior proposal. The agreement also provides for certain break-up fees payable to Microsemi in connection with the termination of the agreement in certain circumstances.

The Proposed Transaction Fails to Maximize Stockholder Value

78. The Proposed Transaction consideration is inadequate and significantly undervalues the Company. Microsemi is seeking to acquire the Company at the most opportune time, at a time when the Company is poised for substantial growth. More specifically, the synergies created by the Proposed Transaction coupled with analyst expectations and the Company’s recent growth and dominant Ethernet market position, demonstrate that the $5.28 per share offer price is inadequate.

79. First, the Proposed Transaction consideration fails to adequately compensate Vitesse’s stockholders for the significant synergies created by the Proposed Transaction. In the March 18, 2015 press release announcing the Proposed Transaction, Microsemi noted that, due to synergies from the Proposed Transaction, it expects to see immediate accretion in the first full quarter of completion. In total, Microsemi expects the acquisition to be $0.16 to $0.20 per share accretive in the first fiscal year ending September 30, 2016.

80. Given the Company’s prospects for future growth, Ascendiant Capital’s David Williams and Cody Acree called the offer a “bit low:”

[G]iven what we think VTSS could earn on its own in the next 12-24 months, the $389 million offer appears a bit low, in our opinion. With that, we would not be surprised if other offers materialize over the next three weeks, specifically given that MSCC expects the deal to be immediately accretive in the first quarter after closing and for the full year, which is indicative of the relatively inexpensive price MSCC is

paying for the asset. Potential suitors could include Broadcom or Marvell, who are already leaders in Ethernet and would see natural synergies in VTSS’s portfolio or Avago who has also been particularly acquisitive. Overall, with recent tech M&A activity, we are not surprised to see this acquisition. We have long believed the company presented a significant value proposition as the underlying growth drivers were developing, yet masked by the declining mature products. We believe VTSS’s 3Q was the turning point for the company, with clear line of sight to continued profitability. Although we do see the current acquisition partner as a good fit, we would have expected a moderately higher premium, more in-line with the growth opportunities ahead.

81. Other analysts have also weighed in. Of the six analysts following Vitesse on Yahoo! Finance, at least one analyst has set a price target for the Company at $6.00 per share, representing a 12% premium to the price being offered by Microsemi. The mean target of these analysts is $5.41. Moreover, Vitesse’s shares have been consistently trading at or above the $5.28 offer price since the Proposed Transaction was announced on March 18, 2015.

82. The Board’s decision to sell the Company for inadequate consideration fails to maximize stockholder value and deprives the Company’s stockholders of their ability to reap the benefits of Vitesse’s promising growth.

The Unreasonable Deal Protection Provisions

83. To ensure the Proposed Transaction is consummated on its present terms, and in violation of the duty of the Individual Defendants to maximize stockholder value, the Merger Agreement contains preclusive deal terms designed to favor Microsemi and to deter alternative bids. These provisions include: (i) a

strict “no-solicitation” provision that prohibits the Company from soliciting other potential acquirers or from continuing existing discussions with potential acquirers; (ii) a provision that provides Microsemi with four business days to match any competing proposal in the event one is made, and an additional three business day period to negotiate after the Company has agreed to a superior proposal; and (iii) a provision that requires the Company to pay Microsemi a termination fee of either $6.8 million or $13.6 million (depending on the timing) in order to enter into a transaction with a superior bidder. These provisions unreasonably inhibit the Board’s ability to act with respect to investigating and pursuing superior proposals and alternatives, including a sale of all or part of Vitesse.

84. While Section 7.3(a) of the Merger Agreement contains a “go-shop” provision that allowed the Company to solicit other acquisition proposals until April 7, 2015, the other terms inhibited a potential bidder from coming forward. If the Company were to accept a superior proposal during the go-shop period, Vitesse must pay to Microsemi a “termination fee” of $6.8 million if the agreement is entered into three full business days prior to the initial expiration date of the Tender Offer, or $13.6 million if such termination occurs thereafter. This provision significantly waters down the positive effect of a go-shop window, as any potential suitor will essentially have to pay a naked premium, in addition to the

merger consideration, for the right to provide Vitesse stockholders with a superior offer. Put simply, the go-shop is limited and inadequate, and indeed, of the twenty-eight potential acquirors contacted during the go-shop period, none submitted a superior proposal, and the Company is now subject to a strict “no-solicitation” provision.

85. Section 7.3(b) of the Merger Agreement includes a “no solicitation” provision barring the Company from soliciting interest from other potential acquirers after the expiration of the go-shop period in order to procure a price in excess of the amount offered by Microsemi. This Section also requires that the Company terminate any and all discussions with other potential acquirers.

86. Pursuant to Section 7.3(c) of the Merger Agreement, should an unsolicited bidder submit a competing proposal, the Company must notify Microsemi of the bidder’s identity and the terms of the bidder’s offer and grant Microsemi four business days to negotiate with the Company to amend the Merger Agreement so that the third party’s proposal is no longer a superior offer. Additionally, if the Company thereafter agrees to enter into the superior acquisition proposal with the other bidder, Microsemi will be provided with the written agreement and concomitant terms and conditions of the superior offer and have an additional three business days with which to negotiate with the Company and amend the Merger Agreement.

87. Finally, Section 9.3 of the Merger Agreement provides that a termination fee of $13.6 million must be paid by Vitesse to Microsemi if the Company decides to pursue a competing offer after the expiration of the go-shop period.

The Individual Defendants’ Self-Interest in the Proposed Transaction

88. Compounding their breaches of fiduciary duties and failing to maximize stockholder value, the Individual Defendants will reap benefits from the Proposed Transaction not shared with the Company’s public stockholders.

89. First, Section 3.5 of the Merger Agreement states that the officers of the Company shall be the initial officers of the surviving corporation, and remain officers until their respective successors are duly elected or appointed, resignation, or removal. Further, the Proposed Transaction will allow the Individual Defendants to collect any change-of-control benefits (including, but not limited to, the vesting of stock options and any restricted stock awards).

90. The insiders are also receiving financial benefits not shared by the Company’s public stockholders. The executive officers, the Individual Defendants, and Raging Capital collectively own 15,691,265 shares of Company stock. At the $5.28 per share offer price, this results in over $82 million dollars payable to the officers, directors, and their affiliates when these shares are tendered.

91. For this reason, the Major Stockholders entered into the Support Agreement. The Support Agreement provides that the Major Stockholders, who control 22% of the outstanding shares, have agreed to tender their shares of Company common stock in favor of the Proposed Transaction, take certain other actions in furtherance of the Proposed Transaction, and to not vote any of their shares in favor of an alternative acquisition proposal from a third party bidder. Together, the Major Stockholders and Microsemi hold approximately 23.5% of the outstanding shares of the Company.

92. In addition, the Compensation Committee approved the accelerated vesting of all Company RSUs held by non-employee directors immediately prior to the merger. As a result, the Individual Defendants eligible for this benefit will receive over $630,000 from their unvested RSUs which will vest as a result of the Proposed Transaction. The non-employee directors stand to receive over $111,000 from their shares underlying RSUs. Assuming the change in control occurs on April 27, 2015, Gardner stands to receive over $3.9 million under the terms of his employment agreement.

The Recommendation Statement is Materially Misleading

93. To compound matters, the Recommendation Statement omits material information necessary for Vitesse’s stockholders to make an informed decision as to whether to tender their shares or seek appraisal. By omitting such

information, the Board is breaching its fiduciary duty of candor to the Company’s public stockholders. As set forth in more detail below, the Recommendation Statement omits and/or misrepresents material information concerning, inter alia: (i) the sale process leading to the Proposed Transaction; (ii) the data, inputs, and analyses underlying the opinion prepared by Deutsche Bank; and (iii) the management-prepared forecasts of Vitesse. More specifically, the Recommendation Statement is deficient and misleading for the following reasons:

Information Relating to the Background of the Merger

94. The Recommendation Statement omits the following information with respect to the events leading up to the Proposed Transaction: (i) what other specific transactions and initiatives that could reasonably be likely to enhance stockholder value were considered by the Strategic Advisory Committee in October 2011; (ii) the steps the Board determined to take to increase the likelihood that other potential acquirors would be in a position to bid for Vitesse if Company A made public its efforts to acquire the Company in March 2013; (ii) whether the Committee or the Board had discussions amongst themselves or with Martin prior to August 13, 2014 about Martin joining the Board; (iv) the Board’s reason for reconstituting the Committee on October 1, 2014; (v) why Hanson, Martin, and Traub were appointed to the Committee; (vi) details of the substance, nature, and timing of any discussions between the Company and Microsemi regarding

executive retention; and (vii) whether Vitesse entered into standstill agreements with any other potential bidders and whether those standstill agreements are still in place.

Information Relating to Deutsche Bank’s Analysis

95. The Recommendation Statement omits the following information with respect to Deutsche Bank’s financial analysis:

(a) The Selected Public Companies Analysis fails to disclose the following revenue multiples for each of the selected public companies analyzed: (i) EV/2015 revenue; (ii) EV/2016 revenue; (iii) P/2015 EPS; (iv) P/2016 EPS. The Recommendation Statement also fails to disclose whether Deutsche Bank performed any type of benchmarking analysis for Vitesse in relation to the selected public companies.

(b) The Selected Precedent Transaction Analysis fails to disclose the individual last twelve months and next twelve months EV/revenue multiples for each of the selected transactions analyzed by Deutsche Bank.

(c) The Discounted Cash Flow Analysis fails to disclose: (i) the definition of “unlevered free cash flow” used by Deutsche Bank in its analysis; (ii) the beginning balance and present value of the NOLS incorporated into Deutsche Bank’s analysis; (iii) the implied terminal EBITDA and/or revenue multiple range resulting from this analysis; and (iv) the individual inputs and assumptions used by Deutsche Bank to derive the discount rate range of 13% to 17%.

96. The Recommendation Statement omits the following information with respect to the Company’s financial projections: (i) the factors that are driving the average growth rate of 24% from fiscal 2015 to 2019; (ii) why management expects that growth rate, which for the four years prior was estimated to be 24%, to virtually stop after fiscal 2019 and decline to 2% to 4%; (ii) taxes (or tax rate), changes in net working capital, any other adjustments to unlevered free cash flow, and unlevered free cash flow for fiscal years 2016 through 2019; and (iii) revenue, EBITDA, EBIT (or D&A), taxes (or tax rate), capital expenditures, changes in net working capital, stock-based compensation expense, any other adjustments to unlevered free cash flow, and unlevered free cash flow for calendar years 2015 through 2018.

97. Accordingly, Plaintiff seeks injunctive and other equitable relief to prevent the irreparable injury that Company stockholders will continue to suffer absent judicial intervention.

FIRST CAUSE OF ACTION

Breaches of Fiduciary Duties

(Against the Individual Defendants)

98. Plaintiff repeats and realleges all previous allegations as if fully set forth herein.

99. The Individual Defendants have breached their fiduciary duties owed to the stockholders of Vitesse. By the acts, transactions, and courses of conduct alleged herein, the Individual Defendants, individually and acting as a part of a common plan, are attempting to unfairly deprive Plaintiff and the Class of the value of their investment in Vitesse.

100. As demonstrated by the allegations above, the Individual Defendants have failed to exercise the necessary care required, and breached their duties of loyalty, care, and candor because, inter alia:

(a) they have agreed to the Proposed Transaction for inadequate consideration;

(b) they have failed to properly value Vitesse;

(d) they have failed to provide critical information to shareholders in the Recommendation Statement.

101. Unless enjoined by this Court, the Individual Defendants will continue to breach their fiduciary duties owed to Plaintiff and the Class, and may consummate the Proposed Transaction, which will deprive Plaintiff and the Class of their fair proportionate share of Vitesse’s valuable assets and businesses, to the irreparable harm of Plaintiff and the Class.

102. As a result of the Individual Defendants’ breaches of their fiduciary duties, Plaintiff and the Class will suffer irreparable injury in that they have not and will not receive their fair portion of the value of Vitesse’s assets and will be prevented from benefiting from a value-maximizing transaction.

103. Plaintiff and the Class have no adequate remedy at law. Only through the exercise of this Court’s equitable powers can Plaintiff and the Class be fully protected from the immediate and irreparable injury, which the Individual Defendants’ actions threaten to inflict.

SECOND CAUSE OF ACTION

Aiding and Abetting Breaches of Fiduciary Duties

(Against Vitesse, Parent, and Merger Sub)

104. Plaintiff repeats and realleges all previous allegations as if fully set forth herein.

105. Defendants Vitesse, Parent, and Merger Sub, by reason of their status as parties to the Merger Agreement, and their possession of non-public information, have aided and abetted the Individual Defendants in the aforesaid breaches of their fiduciary duties.

106. Such breaches of fiduciary duties could not and would not have occurred but for the conduct of Defendants Vitesse, Parent, and Merger Sub which, therefore, have aided and abetted such breaches in the possible sale of Vitesse to Microsemi.

107. As a result of the unlawful actions of Defendants Vitesse, Parent, and Merger Sub, Plaintiff and the Class will be irreparably harmed in that they will not receive adequate value for Vitesse’s assets and business. Unless the actions of Defendants Vitesse, Parent, and Merger Sub are enjoined by the Court, Defendants Vitesse, Parent, and Merger Sub will continue to aid and abet the Individual Defendants’ breaches of their fiduciary duties owed to Plaintiff and the Class.

108. Plaintiff and the Class have no adequate remedy at law.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff prays for judgment and relief as follows:

A. Declaring that this action is properly maintainable as a class action and designating Plaintiff as Class representative;

B. Enjoining Defendants, their agents, counsel, employees and all persons acting in concert with them from consummating the Proposed Transaction;

C. Directing Defendants to account to Plaintiff and the Class for all damages suffered by them as a result of Defendants’ wrongful conduct alleged herein;

D. In the event Defendants consummate the Proposed Transaction, rescinding it and setting it aside or awarding rescissory damages to Plaintiff and the Class;

E. Awarding Plaintiff the costs and disbursements of this action, including reasonable attorneys’ and experts’ fees; and

F. Granting such other and further equitable relief as this Court may deem just and proper.

ROSENTHAL, MONHAIT & GODDESS, P.A.

LOGO

Jessica Zeldin (#3558)

P. Bradford deLeeuw (#3569)

919 N. Market Street, Suite

1401

Wilmington, DE 19801

Telephone: (302) 656-4433

Facsimile: (302) 658-7567

Attorneys for Plaintiff

OF COUNSEL:

KIRBY McINERNEY LLP

J. Brandon Walker

Melissa A. Fortunato

825 Third Avenue, 16th Floor

New York, New York 10022

Telephone: (212) 371-6600

Facsimile: (212) 699-1194

April 10, 2015

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