BENEFITS

Defined contribution plan:

Starting January 1, 2011, Maxim reinstated its 401(k) employer matching contribution for U.S. employees. U.S. employees are automatically enrolled in the plan when they meet eligibility requirements, unless they decline participation. Under the terms of the plan Maxim matches 100% of the employee contributions up to 3% of employee eligible compensation and 50% of additional employee contributions up to 5% of employee eligible compensation, up to the IRS Annual Compensation Limits. Total defined contribution expense was $6.0 million in fiscal 2011.

Non-U.S. Pension Benefits

We provide defined-benefit pension plans in certain countries. Consistent with the requirements of local law, we deposit funds for certain plans with insurance companies, with third-party trustees, or into government-managed accounts, and/or accrue for the unfunded portion of the obligation.

Former CEO Retirement Benefits

The Company's former CEO, John F. Gifford, now deceased, resigned in fiscal year 2007. As part of his resignation, he was provided with certain retirement benefits which included office space, administrative assistance, and health benefits. In accordance with ASC 712, the Company recorded a charge for the net present value of these benefits of $3.1 million in fiscal year 2007. During the fiscal year ended June 27, 2009, the Company reversed $2.4 million of accrued retirement benefits as a change in estimate as a result of the death of Mr. Gifford.

Post-Employment Benefits

The Company maintained an outstanding obligation associated with certain former Maxim employees to provide post-employment medical benefits. The total amount of this obligation was $4.8 million and $5.6 million and included in Other liabilities in the Consolidated Balance Sheet as of June 25, 2011 and June 26, 2010, respectively.

Post-Retirement Benefits

As a result of the Company's 2001 acquisition of Dallas Semiconductor, the Company assumed the obligation to continue medical coverage for certain former officers and directors. The Company accounted for the obligation under GAAP applicable to post-retirement benefits.

Medical Expense & Funded Status Reconciliation



	June 26 2010			Fiscal 2011 Expense		Current Year end			Estimated Fiscal 2012 Expense
	(in thousands, except percentages)
Accumulated Postretirement Benefit Obligation [APBO]:
Retirees and beneficiaries	$	(9,239	)			$	(9,989	)

Funded status	$	(9,239	)			$	(9,989	)

Actuarial loss						$	521

Amounts Recognized in Accumulated Other Comprehensive Income:
Net actuarial loss	$	7,327				$	7,484
Total	$	7,327				$	7,484

Net Periodic Postretirement Benefit Cost/(Income):
Interest cost				471					500
Amortization:
Net actuarial loss (1)				364					388
Total net periodic postretirement benefit cost				$	835				$	888

Employer contributions				$	241				$	388

Economic Assumptions:
Discount rate	5.2%					5.1%
Medical trend	10.0% in 2011, declining to 5% at the rate of 0.5%/yr.					9.5% in 2012, declining to 5% at the rate of 0.5%/yr.
Dental trend	5.0%					5.0%

(1) Unrecognized losses are amortized over an average remaining life expectancy of 16.7 years at June 25, 2011.

The following benefit payments are expected to be paid:



	Non-Pension Benefits
2012	$	388
2013	428
2014	469
2015	508
2016	546
Thereafter	7,650
	$	9,989

Dallas Semiconductor Split-Dollar Life Insurance

As a result of the Company's 2001 acquisition of Dallas Semiconductor, the Company assumed responsibility associated with certain split-dollar life insurance policies held by certain former Dallas Semiconductor officers and directors. The policies are owned by the individuals with the Company maintaining a limited collateral assignment on each policy. As a result of the adoption of ASC 715, Accounting for Compensation in retirement benefits, during the first quarter of fiscal year 2008 (effective July 1, 2007), the Company recognized a $14.1 million cumulative reduction to retained earnings. No corporate income tax benefit was netted against the charge to retained earnings because the liabilities being accrued are not deductible for corporate income tax purposes.

During the fourth quarter of 2009, the Company entered into contractual arrangements to settle certain of these split- dollar life insurance policies for cash consideration of $6.4 million. Pursuant to the arrangements the Company released rights to their limited collateral assignment on the policies and was relieved of its obligation to continue funding the policies.

The Company had $2.9 million and $2.7 million included in Other Assets as of June 25, 2011 and June 26, 2010, respectively, associated with the limited collateral assignment to the policies. The Company had a $4.4 million and $4.2 million obligation included in Other Liabilities as of June 25, 2011 and June 26, 2010, respectively, related to the anticipated continued funding associated with these policies.