8-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): November 5, 2008

STANDARD MICROSYSTEMS CORPORATION
__________________________________________
(Exact name of registrant as specified in its charter)

Delaware	0-7422	11-2234952
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
80 Arkay Drive, Hauppauge, New York		11788-3728
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

Registrant’s telephone number, including area code: 631 434-6300

Not Applicable
______________________________________________
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On November 5, 2008 the Board of Directors of the Registrant (the "Board") approved the amendment and restatement of the Registrant’s Supplemental Executive Retirement Plan, as of January 1, 2008 (the "SERP"). The SERP was amended primarily to add additional technical language to comply with the final regulations issued pursuant to Section 409A of the Internal Revenue Code of 1986, as amended ("Section 409A").

On November 5, 2008, the Compensation Committee of the Registrant amended and restated the Standard Microsystems Corporation Severance Plan (the "Severance Plan") as of December 31, 2008 and the Registrant’s Letter Agreements with Walter Siegel, Vice President and General Counsel, and Aaron Fisher, Senior Vice President of Products and Technology. These documents were amended primarily to add additional technical language to comply with the final regulations issued pursuant to Section 409A.
The descriptions of the SERP, the Severance Plan, and the Siegel and Fisher Letter Agreements are qualified in their entirety by the full text of these documents, respectively attached hereto as Exhibits 10.1-10.4 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(c) Exhibits


10.1* -2005 Supplemental Executive Retirement Plan, amended and restated as of January 1, 2008.

10.2* - Standard Microsystems Corporation Severance Plan amended and restated as of December 31, 2008.

10.3* - Letter Agreement of Walter Siegel dated November 5, 2008.

10.4* - Letter Agreement of Aaron Fisher dated November 5, 2008.


* Indicates a management contract or compensatory plan or arrangement.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	STANDARD MICROSYSTEMS CORPORATION
November 7, 2008	By:	/s/ Christine King
		Name: Christine King
		Title: President and Chief Executive Officer

Exhibit Index

Exhibit No.	Description
10.1	2005 Supplemental Executive Retirement Plan, amended and restated as of January 1, 2008.
10.2	Standard Microsystems Corporation Severance Plan amended and restated as of December 31, 2008.
10.3	Letter Agreement of Walter Siegel dated November 5, 2008.
10.4	Letter Agreement of Aaron Fisher dated November 5, 2008.

EX-10.1

Exhibit 10.1

STANDARD MICROSYSTEMS CORPORATION

2008 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

(the “SERP”)

Amended and Restated as of January 1, 2008

STANDARD MICROSYSTEMS CORPORATION
2008 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

PREAMABLE

WHEREAS, Standard Microsystems Corporation (“SMSC” or the “Company”), a Delaware Corporation, previously maintained the Standard Microsystems Corporation Executive Retirement Plan which was amended and restated effective as of January 1, 2003 (the “Plan” or the “2003 SERP”); and

WHEREAS, the purpose of the 2003 SERP was to provide a supplemental retirement benefit for certain key executive officers through the payment of supplemental retirement and death benefits; and

WHEREAS, Section 409A of the Internal Revenue Code (the “Code”), as enacted under the American Jobs Creation Act of 2004 (“AJCA”) imposes new rules regarding the time and form of distributions under nonqualified retirement plans, such as the 2003 SERP; and

WHEREAS, all benefits to which employees had a legally binding right, and no substantial risk of forfeiture effective as of December 31, 2004, could have continued to be governed by the terms of the 2003 SERP and not be subject to Section 409A under a special “grandfather rule”; and

WHEREAS, after consideration, the only advantage of the grandfathered rule was to permit prior deferrals not to be subject to the 6 month delay in payment rules for “Specified Employees” of publicly traded companies, such as SMSC; and

WHEREAS, in order to comply with Section 409A of the Code, SMSC amended and restated the 2003 SERP into the Standard Microsystems Corporation 2005 Supplemental Executive Retirement Plan effective as of January 1, 2005 (the “SERP”, the “Plan” or the “2005 SERP”), on March 22, 2007; and

WHEREAS, the intent of the 2005 SERP was to comply with all IRS announcements and notices, including Notice 2005-1 and the Proposed Regulations issued under Section 409A.

WHEREAS, the 2005 SERP was adopted prior to the issuance of the Final Regulations under Section 409A of the Code; and

WHEREAS, SMSC wishes to amend and restate the 2005 SERP to incorporate certain provisions of the Final Regulations; and

WHEREAS, adoption of the 2005 SERP documented SMSC good faith compliance with Section 409A of the Code.

NOW, THEREFORE, effective as of January 1, 2008, the SERP is amended and restated into the new Standard Microsystems Corporation 2008 Supplemental Executive Retirement Plan (the “Plan” or the “2008 Plan”) as follows:

ARTICLE I
DEFINITIONS

The following words and terms as used herein shall have the respective meanings hereinafter set forth, unless the context clearly requires a different meaning.

1.1 “Actuarial Assumptions” means, for purposes of determining optional forms of payment, the interest rate most recently used by the Company’s actuary for the purpose of financial accounting under the Plan and the GAR 94 Mortality Table for post-commencement periods with no mortality for pre-commencement periods, except as otherwise indicated in any Exhibits, as amended from time to time.

1.2 “Administrator” means the Committee selected by the Board to administer the Plan (the “Committee”) or, if the Board fails to select a Committee, SMSC. The Board may from time to time appoint members of the Committee in substitution for or in addition to members previously appointed and may fill vacancies, however caused, in the Committee. The Administrator shall have plenary authority in its discretion to interpret the Plan, to prescribe, amend, and rescind rules and regulations relating to the Plan, and to make all determinations it may deem necessary or advisable for the administration of the Plan. Any interpretation or determination made by the Administrator pursuant to the foregoing shall be conclusive and binding upon any person having or claiming any interest under the Plan.

1.3 “Beneficiary” means the person, persons or entity designated in writing by the Executive, on forms provided by the Administrator, to receive the benefits payable under the Plan in the event of the Executive’s death. An Executive may change his Beneficiary from time to time by filing a new written designation with the Administrator and such designation shall be effective upon receipt by the Administrator. If an Executive has not validly designated a Beneficiary or if a designated Beneficiary shall predecease an Executive, any death benefit then payable under the Plan shall be paid to the Executive’s Spouse, if then living, and if such Spouse is not then living, to the Executive’s estate.

1.4 “Board” means the Board of Directors of SMSC.

1.5 “Base Annual Salary” means one-third of the aggregate base salary paid by the Company to the Participant during the 36-month period immediately preceding the Participant’s termination of employment, or, in the case of a Participant who becomes a Vested Participant upon occurrence of a change in control, as referred to in Section 1.6, Base Annual Salary means the annual base salary in effect immediately before such change in control. Such base salary shall be determined before reduction for employee contributions to the Standard Microsystems Corporation Incentive Savings and Retirement Plan, flexible spending accounts, or other similar reductions. Base Annual Salary shall not include overtime, commissions, bonuses, options, benefits or any other compensatory payment, whether or not taxable, not described in the first sentence of this Section. Notwithstanding any provisions to the contrary, to the extent that any Participant works a reduced number of hours, the Board may, within its discretion, determine that such Participant shall have the Participant’s Base Annual Salary determined as of the time the reduction in hours occurs. Future SERP benefits shall continue to be computed based upon the 36 month period immediately preceding the reduction in hours, or the annual base salary in effect immediately before a change in control, whichever is appropriate, rather than the ultimate termination of employment.

1.6 “Change in Control” means the occurrence of one of the following events:

a. The merger or consolidation of SMSC with or into any other corporation or entities whereby the shareholders of SMSC immediately before the transaction do not own at least 50% of the new entity;

b. SMSC is merged or consolidated with or into any other corporation or other entity, and at any time after such merger or consolidation is effected, the Continuing Directors are not or cease for any reason to constitute a majority of the board of directors either of the surviving entity, or of any entity in control of the surviving entity;

c. All or substantially all of the assets of SMSC are sold or otherwise transferred to any other corporation or other entity, or more than 50% of the stock of SMSC is purchased by one entity, and at any time after such sale or other transfer is effected, the Continuing Directors are not or cease for any reason to constitute, a majority of the board of directors either of the entity which has acquired and owns such assets, or of any entity in control of the entity which has acquired and owns such assets. In determining if a Change in Control occurs, the term “Continuing Directors” means any person who either: (i) was elected a member of the Board at any Annual Meeting of Stockholders of SMSC prior to the occurrence of a corporate event that is determined to be a Change in Control; or (ii) whose election to the Board or nomination for election to the Board by SMSC’s stockholders was approved in advance by at least two-thirds of the Continuing Directors then in office,

d. Any other event for which SMSC is required to report such a change on Form 8-K, as required by the Securities and Exchange Commission; or,

e. Any event described as either a change in ownership or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company, as defined under Section 409A of the Code or the regulations issued there under.

1.7 “Claims Coordinator” means the individual(s) designated by the Administrator to receive applications for benefits by Participants and Beneficiaries.

1.8 “Code” means the Internal Revenue Code of 1986, as amended.

1.9 “Company” means SMSC and any subsidiary or division of SMSC designated by resolution of the Board to which the Plan shall be applicable, and any successor thereof, which adopts the Plan.

1.10 “Disability” means a Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment, which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, as determined by an independent third party physician, selected within the discretion of the Committee. The determination of whether a Participant is disabled shall be determined by the Committee, in its sole discretion, but subject to the provisions of Section 409A.

1.11 “Effective Date” means January 1, 2008, for purposes of the amended and restated SERP. The original effective date of the Plan was March 1, 1994. SMSC can demonstrate its good faith compliance with Section 409A from January 1, 2005 to December 31, 2007, as permitted under the Final Treasury Regulations issued under Section 409A of the Code.

1.12 “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

1.13 “Executive” means an officer of the Company whom the Board has explicitly authorized by Resolution to participate in the Plan.

1.14 “Highly Compensated Employee” means an individual who is characterized as a highly compensated employee under Section 414(q) of the Code. To the extent required by Department of Labor Regulation Section 2520.104-23, to permit the Plan to qualify as a “Top Hat” plan for a select group of highly compensated employees, the term Highly Compensated Employee shall be restricted by the Committee to satisfy this Department of Labor Regulation. To the extent any Participant is determined to no longer be a Highly Compensated Employee while actively participating in the Plan, all future benefits shall terminate until such time as the Participant is once again determined to be a Highly Compensated Employee. The Committee shall have the discretion to take all actions necessary to preserve the “Top Hat” status of the Plan, including but not limited to distributing any benefits and terminating the participation of any Participant in the Plan, except to the extent such action would violate Section 409A.

1.15 “Highly Compensated Participant” means a Highly Compensated Employee who participate in the Plan.

1.16 “Key Employee” means an individual as described in Section 416(i) of the Code, determined without regard to Section 416(i)(5) thereof. For purposes of this provision, a Key Employee is an officer earning more than $135,000 in 2005, $140,000 in 2006, $145,000 in 2007, $150,000 in 2008 and $165,000 in 2009 (with a limit of no more than 50 employees, or if less, the greater of 3 or 10% of all employees); a 5% owner; or a 1% owner having annual compensation of more than $150,000. All amounts shall automatically be increased as provided under the Code for cost of living or other changes.

1.17 “Participant” means an Executive, who is a Highly Compensated Employee, who has executed and filed with the Administrator a Participation Agreement.

1.18 “Participation Agreement” means an agreement executed in accordance with the provisions of Section 2.1 of the Plan.

1.19 “Plan” shall mean the Standard Microsystems Corporation 2005 Supplemental Executive Retirement Plan.

1.20 “Plan Year” means the period beginning on each January 1 and ending on the following December 31.

1.21 “Related Entities” means any entity within the SMSC “single employer” controlled group as defined under Section 414 of the Code, or any entity that is part of SMSC’s “controlled group” as defined under Section 1563 of the Code.

1.22 “Retirement” means a Participant has retired from service with SMSC, and all Related Entities, in accordance with SMSC’s normal employment policies and procedures, after attaining the age of 65 or earlier.

1.23 “Separation from Service” means a Participant is no longer employed by SMSC or any Related Entities within or outside of the United States on account of a termination of employment, Retirement, Disability or death. Consistent with Final Treasury Regulation Section 1.409A-1(h), or any subsequent guidance under Section 409A of the Code, no Separation from Service shall occur if a Participant continues to perform services as a consultant or an Employee in accordance with the following rules:

a. Leave of Absence. For purposes of Section 409A, the employment relationship is treated as continuing in effect while a Participant is on military leave, sick leave, or other bona fide leave of absence, as long as the period of leave does not exceed 6 months, or if longer, as long as the Participant’s right to reemployment with SMSC or any Related Entity are provided either by statute or contract. Otherwise, after a 6 month leave of absence, the employment relationship is deemed terminated.

b. Part-Time Status. Whether or not a termination of employment occurs is determined based upon all facts and circumstances. However, in the event that services provided by a Participant are insignificant, a Separation from Service shall be deemed to have occurred. For purposes of Section 409A, if a Participant is providing services to SMSC or any Related Entities at a rate that is at least equal to 20% of the services rendered, on average, during the immediately preceding 3 full calendar years of employment (or such lesser period), and the annual compensation for such services is at least 20% of the average annual compensation earned during the final 3 full calendar years of employment (or such lesser period), no termination shall be deemed to have occurred since such services are not insignificant.

c. Consulting Services. Where a Participant continues to provide services to SMSC or any Related Entities in a capacity other than as an employee, a Separation from Service shall not be deemed to have occurred if the Participant is providing services at an annual rate that is 50% or more of the services rendered, on average, during the immediately preceding 3 full calendar years of employment (or such lesser period) and the annual remuneration for such services is 50% or more of the annual remuneration earned during the final 3 full calendar years of employment (or such lesser period).

1.24 “Specified Employee” means a Key Employee who is employed by SMSC or any Related Entities which has its stock publicly traded on an established securities market. For purposes of determining Specified Employee status, the Employer hereby designates each December 31 as the “Identification Date” under Section 409A of the Code. Anyone determined to be a Specified Employee shall remain a Specified Employee for the 12 month period of time after the expiration of the first day of the fourth month following the determination of Specified Employee status (i.e., from April 1 to the following March 31). The determination of whether a Participant is a Specified Employee shall be made by an officer of SMSC on an annual basis for purposes of all nonqualified deferred compensation plans and any other programs in accordance with the provisions of Section 409A of the Code.

1.25 “Spouse” means the person to whom a Participant is legally married at the time of such determination (as determined by the Administrator under local state law). The term “Surviving Spouse” means the survivor of a deceased former Participant to whom such deceased former Participant was legally married (as determined by the Administrator) on the date of the Participant’s death.

1.26 “Unforeseeable Emergency” means a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, or a dependent (as defined in Section 152(a)) of the Participant; loss of the Participant’s property due to casualty; or any other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant, as determined under Section 409A of the Code.

1.27 “Valuation Date” means the last day of each Plan Year, or more frequently as determined within the discretion of the Committee.

1.28 “Vested Participant” means a Participant who has become vested in accordance with the provisions of Article III.

1.29 “Years of Service” means periods of time during which a Participant is employed at the Company, regardless of the actual hours worked in any periods. The Administrator shall adopt uniform rules for crediting Years of Service. Under such rules, periods of authorized leaves of absence and periods of service for Related Entities may be credited towards satisfaction of the applicable Years of Service for vesting. For Participants who enter the Plan after January 1, 2003, only service as an Executive is credited as Years of Service. For clarity regarding Participants who are not fully vested as of January 28, 2003, the following dates are the dates that each such Participant became a Participant in the Plan: Steven Bilodeau, March 1, 1999; Peter Byrnes, July 14, 1998; Andrew Caggia, February 15, 2000; and Robert Hollingsworth, January 28, 2003.

ARTICLE II
PARTICIPATION

2.1 Commencement of Participation. An Executive shall become a Participant, effective as of his hire date or the date he became an Executive (for Participants who enter the plan after January 1, 2003), as applicable, upon receipt by the Administrator of a Participation Agreement that is properly executed by the Executive. The Participation Agreement shall be in a form prescribed by the Administrator and shall specify that the Executive agrees to be bound by all of the terms of the Plan.

ARTICLE III
VESTING

3.1 a. Prior to 2003. For Participants who entered the Plan prior to January 1, 2003, such Participants become 100% vested in all benefits under the Plan upon the completion of 10 continuous Years of Service for the Company, including Years of Service prior to the establishment of the Plan and Years of Service prior to becoming an Executive, except that, per employment agreements dated March 18, 1999, and January 7, 2000, respectively, Steven Bilodeau and Andrew Caggia shall become 50% vested upon the completion of 5 Years of Service with the remaining 50% vesting as outlined in Section 3(1)(b) below.

b. Effective in 2003. For Participants who enter the Plan on or after January 1, 2003, such Participants shall become 50% vested in their benefits under the Plan upon the completion of 5 Years of Service as an Executive. Participants shall thereafter become further vested over the next 5 years in a pro rata manner measured from the fifth anniversary date of when the Participant became an Executive on a monthly basis, providing for a full month of vesting service for each month in which any time is worked, or credited for having been worked. Upon the completion of 10 Years of Service, a Participant shall be 100% vested in all benefits. For example, if an individual becomes a Participant on or after January 1, 2003, works for the Company for a period of 7 years and 6 months, the Participant shall be 75% vested in the Plan (5 years; plus 30 months divided by 60 months, multiplied by the remaining 5 year vesting period).

3.2 Break in Service. For Participants who enter the Plan on or after January 1, 2003, in determining Years of Service, only Years of Service worked for the Company, and any Related Entities, as an Executive, shall be taken into consideration in determining a Participant’s vested percentage. Periods of time prior to any break in service shall not be considered in determining Years of Service. However, any periods worked after becoming an Executive, in any capacity other than as an Executive, shall not count as a break in service, even though such time does not count for vesting. Notwithstanding the provisions of this Section 3.2, the Board of Directors may, within its discretion, grant past service credits to any Participant for purposes of vesting.

3.3 Vesting Upon a Change in Control. In the event of any Change in Control, notwithstanding any provisions of the Plan to the contrary, all Participants, who entered the Plan before January 1, 2003, shall immediately become 100% vested in their benefits. All benefits shall continue to be paid in accordance with the terms of the Plan.

The above provisions regarding 100% vesting upon a Change in Control only applies to Participants who enter the Plan before January 1, 2003. However, the Board, may, within its discretion, approve the vesting, in whole or in part, for Participants who entered the Plan after January 1, 2003, in the event of a Change in Control.

ARTICLE IV
BENEFITS

4.1 Retirement Benefit. A Vested Participant who retires on or after attaining age 65 shall be entitled to receive a retirement benefit from the Company, in an annual amount equal to 35% of the Participant’s Base Annual Salary. The retirement benefit shall be paid in equal monthly installments, beginning on the first day of the first calendar month following the Participant’s Separation from Service, and shall continue until 120 monthly installments shall have been paid.

4.2 Termination Benefit.

a. A Vested Participant whose employment with the Company terminates prior to attaining age 65 shall be entitled to receive a termination benefit from the Company in an annual amount equal to 35% of the Participant’s Base Annual Salary. The termination benefit shall be paid in equal monthly installments, beginning on the first day of the first calendar month following the Participant’s attainment of age 65 and shall continue until 120 monthly installments shall have been paid.

b. A Vested Participant whose employment with the Company terminates by reason of Disability shall be entitled to receive a termination benefit from the Company in an annual amount equal to 35% of the Participant’s Base Annual Salary. The Disability benefit shall be paid in equal monthly installments, beginning on the first day of the first calendar month following the determination that the Participant is Disabled and shall continue until 120 monthly installments shall have been paid.

c. Notwithstanding Section 4.2(b), no termination benefit shall be payable to a Participant who is not a Vested Participant, whose employment terminates by reason of a Disability, on or after the date that the Participant resumes employment with the Company or another employer.

4.3 Death Benefit. If a Participant who has begun to receive payments under Sections 4.1 or 4.2 shall die before receiving all payments due him hereunder, the present value of all remaining installments shall be paid to his Beneficiary in a single lump sum cash payment within 30 days following the Participant’s death.

For Participants who enter the Plan on or after January 1, 2003, and who has begun to receive payments, dies before receiving all payments, the present value of 50% of the remaining installments (i.e., 17.5%) shall be paid to a Participant’s Beneficiary in a single lump sum cash payment within 30 days following the Participant’s death.

In the event that: (i) a Participant dies while still employed by the Company, or (ii) a Participant who has become entitled to receive a retirement or termination benefit, dies after retirement or termination of employment, but prior to receiving a benefit under Section 4.1 or 4.2, the Participant’s Beneficiary shall be entitled to receive a death benefit from the Company equal to the present value of an annual amount equal to 35% of the Participant’s Base Annual Salary for up to 120 monthly installments as otherwise provided above in a single lump sum cash payment within 30 days following the Participant’s death.

For Participants who enter the Plan on or after January 1, 2003, if death occurs before benefits have commenced to be paid, the Participant’s Beneficiary shall be entitled to receive a death benefit equal to the present value of an annual amount equal to 17.5% of the Participant’s Base Annual Salary for up to 120 monthly installments (i.e., 50% of the intended installments), as otherwise provided above in a single lump sum cash payment within 30 days following the Participant’s death.

All death benefits shall be equal to the net present value of all monthly installments, using the interest rate contained in the Actuarial Assumption.

4.4 Termination for Cause. Notwithstanding any other provision of the Plan, if the Company terminates a Participant’s employment for cause (as hereinafter defined), neither the Participant nor his Beneficiary shall be entitled to any benefit under the Plan. For purposes of the Plan, the term “for cause” shall mean and be limited to the following events: (i) the Participant’s conviction in a court of law of a felony or other crime involving moral turpitude; (ii) the Participant’s material breach of any covenant set forth in any agreement between the Participant and the Company; or (iii) the Participant’s commission of an act or omission constituting willful misconduct that is injurious to the Company or a Related Entity. A resolution of the Board declaring that the Participant has committed a breach, act omission or performance described in Section 4.4 (ii) through (iii) shall be conclusive evidence thereof.

4.5 Suicide Exclusion. Notwithstanding any other provision of the Plan: (i) no benefit shall be payable to any Beneficiary in the event the Participant dies, as the result of suicide or self-inflicted injury, within 2 years of the date he first becomes a Participant; and (ii) no increase in the amount of any benefit provided under the Plan shall be payable to any Beneficiary in the event the Participant dies, as the result of suicide or self-inflicted injury, within 2 years of the date of such increase.

4.6 Part-Time Employee Benefits. In the event that any Participant continues to work with SMSC following the attainment of age 65, or earlier, on a part-time schedule, working less than 20 hours per week, such a Participant shall be treated as a “retired” employee for purposes of receiving all benefits under Section 4.1, unless no Separation from Service is deemed to occur for purposes of Section 409A.

ARTICLE V
ALTERNATIVE DISTRIBUTIONS

5.1 Payment of Benefits. Unless elected otherwise in accordance with this Article V, all benefits shall be paid in accordance with Article IV. However, consistent with Section 409A of the Code, Participants who are employed by the Company on or after November 18, 2006 shall be given the ability to make a one time election regarding the manner in which they wish to receive their accruals for 2005, 2006, 2007 and 2008 and for future benefit years. No further changes can be made to the SERP to benefit distributions except as permitted under Sections 5.3 and 5.7. Contributions shall generally begin to be paid following a Separation from Service as follows:

(a) Small Account Balances. To the extent any Participant terminates employment for any reason, and the present value of the Accrued Benefit in the 2008 SERP is less than $50,000, the entire vested amount of the Participant’s benefit shall be paid as soon as reasonably possible within a period of 60 days following such termination of employment in a single lump sum cash payment. This “de minimus rule” shall apply whether or not a distribution is required as a result of death, Disability or any Separation from Service, and regardless of age.

(b) Distribution Elections. Within 30 days after a Participant enters the Plan, a Participant may elect to receive benefits under the Plan, as allowed below. Once an election is made to receive benefits in a form other than the normal form of payment, such an election may not be changed, except as otherwise permitted under Sections 5.3 or 5.7.

Alternative forms of distributions that may be elected at the time a Participant enters the Plan include the following:

(i) Quarterly/monthly installments over a period of years (not to exceed 20 years) beginning on the first day of the calendar quarter following the earlier of or later of attaining any specified age between 55 and 65 or a Separation from Service.

(ii) In a single lump sum cash payment on:

(A) The first day of the calendar quarter after attaining any specified age between 55 and 65 elected by a Participant.

(B) The first day of the calendar quarter following the earlier of or the later of attaining age a specified age between 55 and 65 or incurring a Separation from Service.

(C) Any date specified by a Participant in the applicable Distribution Election Form after age 55.

(c) Installment Payments. Each installment payment shall be treated as a separate payment for purposes of any change in distribution elections under Section 5.4.

5.2 Disability. In the event that payments have commenced to be made to a Participant, pursuant to an election made above, or in accordance with Section 4.2, prior to the date the Participant becomes Disabled, all remaining payments shall continue to be paid to the Participant, or the Participant’s Spouse or other legal representative responsible for the care of the Participant, in the same manner as the Participant was receiving payments prior to the Participant’s Disability, if applicable.

In the event that payments, pursuant to an election made above, have not commenced to be paid to a Participant prior to the date of a Participant becomes Disabled, all payments shall be made to the Participant or any legal representative, in installments over 10 years beginning as of the first day of the calendar quarter following the date of the Participant’s Disability.

5.3 Death. For purposes of any alternative distribution elections, whether or not benefits have commenced to be paid to a Participant, upon death, all payments shall be paid to the Participant’s Spouse or other Beneficiary in a single lump sum cash payment within 30 days following the Participant’s death. If no Spouse or Beneficiary exists, all benefits shall be paid to the Participant’s estate.

5.4 Changes in the Time and Form of Distributions. In accordance with Section 409A of the Code, a Participant may generally not change the time and/or form of a distribution under the Plan, except as provided in IRS Notice 2005-1 and the Final Regulations issued under Section 409A, or subsequent guidance.

In accordance with the Final Treasury Regulations Sections, a Participant may make a “subsequent election” to delay a payment or change the form of payment of an amount of deferred compensation. In order for such an election to be effective the election must be made 12 months prior to the date the payment is scheduled to be paid; the election cannot take effect until at least 12 months after the date upon which the election is made; and the payment with regard to such election must be deferred for a period of not less than 5 years from the date such payment would otherwise have been made. For purposes of this provision, consistent with the Final Treasury Regulations or any other guidance, each installment payment to which any Participant shall be entitled shall be treated as a right to a series of separate payments, thereby permitting a Participant to elect to defer the payment of any quarterly installment, as long as such a deferral election is made consistent with the 12 month election rule and the 5 year delay in payment requirements of this Plan and Section 409A of the Code.

Consistent with the provisions of this Section 5.4, a Participant may elect an alternative date upon which to have benefits commence under the normal form of distribution or under any other manner of distribution permitted in accordance with Section 5.1 of the Plan.

The Committee shall establish uniform procedures, including a Distribution Election Form, in order to allow Participants to elect alternative forms of distributions. The Committee shall make best efforts to ensure that all procedures are established in a manner to allow Participants to elect alternative forms of distributions prior to the date that benefits would otherwise commence, in order to minimize any unintended taxation to Participants under the constructive receipt rule and Section 409A. The Committee may also establish reasonable procedures to allow Participants to elect the form of distribution at the time they become Participants in the Plan, or any time thereafter prior to entitlement to benefits. Participants may be allowed to change their form of distribution within the discretion of the Committee, as long as such action is taken in accordance with Section 409A of the Code.

5.5 Limitation on Elections. Notwithstanding any provisions in the Plan to the contrary, the Committee shall not honor any distribution elections, to the extent such elections would violate the provisions of Sections 5.4 of the Plan or Section 409A of the Code. If any potential violation would occur under Section 409A, the normal form of distribution shall be paid under the Plan as if no election had been made.

5.6 Delay in Payment for Specified Employees. Notwithstanding any provisions in the Plan to the contrary, if a Participant is a Specified Employee, upon a Separation from Service for any reason other than death, the Participant’s benefit may not be paid, or commenced to be paid, earlier than 6 months after the last date of the Participant’s Separation from Service with the Company, unless the Participant qualifies for an exemption or safe harbor. In the event any amounts to be paid during the first 6 months following a Separation from Service are required to be deferred in accordance with this Section, to be in compliance with Section 409A of the Code, such delayed payments shall be paid on the first day of the month after the 6 month separation period, retroactively, with interest equal to the prime rate as of the first day of the month in which a Separation from Service occurs, plus 2%.

5.7 Exception for Specified Employees. Notwithstanding any provision to the contrary, in accordance with the Final Regulations issued under Section 409A of the Code, to the extent that any benefits to a Specified Employee do not exceed the lesser of the Specified Employee salary for the past 2 years or the Section 401(a)(17) limitations, such amount may be paid within the 6 month period of time during which benefits may generally not be paid to Specified Employees. To the extent benefits exceed such limitations (which is a maximum of $460,000 in 2008 and $490,000 in 2009), the balance of any payments not otherwise payable during such period shall be made following the expiration of the 6 month period following a Separation of Service in a single lump sum payment on the first day of the month after the 6 month separation period with interest equal to prime rate as of the first day of the month in which a Separation from Service occurs, plus 2%.

5.8 Special Election for 2005, 2006, 2007, and 2008 Contributions. This Plan is being amended and restated as of January 1, 2008, to comply with the provisions of Section 409A of the Code and the Final Regulations. In accordance with IRS Notice 2005-1, Q&A-19(c), the Final Treasury Regulations under Section 409A and IRS Notice 2007-86, a Plan could be amended to provide for new payment elections without violating the “subsequent deferral” and “anti-acceleration rules” under Section 409A, as long as a Plan is so amended by December 31, 2008. However, a Participant may not, in 2008, change a payment election with respect to payments that a Participant would otherwise receive in 2008, or cause a payment to be accelerated into 2008. Accordingly, with respect to all benefit accounts made to the 2008 SERP for the 2005, 2006, 2007 and 2008 Plan Years, this Plan shall allow all Participants to make new payment elections on or before December 31, 2008, with respect to both the time and form of payment of the 2005, 2006, 2007 and 2008 benefit accruals. This “second election opportunity” is being granted in accordance with all IRS guidance. Furthermore, as long as a new election is made in accordance with Section 5.4, a Participant may elect a new form of distribution for all benefits.

5.9 No Withdrawals for Unforeseeable Emergencies. A Participant shall not be permitted to receive a withdrawal prior to the occurrence of a Separation from Service, death or Disability, in the event of an Unforeseeable Emergency.

5.10 Actuarial Equivalent. All of the above distribution options shall be the actuarially equivalent of the normal form of benefit under the SERP based upon all Actuarial Assumptions.

5.11 Payment Date. Whenever a payment under this Plan specifies a payment period with reference to a number of days (e.g., “payment shall be made within 30 days after a Separation from Service”), the actual date of payment within the specified period shall be within the sole discretion of the Company.

ARTICLE VI
FUNDING

6.1 Plan Unfunded. The Plan shall be unfunded for purposes of the Code and Title I of ERISA, and no assets shall be set aside for the payment of benefits under the Plan, even if a trust is established to provide for the payment of any or all benefits hereunder. All benefits shall be paid from the general assets of the Company, which remain subject to the claims of all general creditors of the Company and to unrestricted use by the Company until benefit payments are made. To the extent the Company decides, within its discretion, to establish a trust or other internal funding vehicles, such as a sinking fund, to provide for the payment of benefits to Participants and assist in meeting the Company’s obligations under the Plan, any such trusts shall be grantor trusts established in accordance with the provisions of Revenue Procedure 92-64 (i.e., a “Rabbi Trust”). Any provisions, which would cause any trust to fail to comply with Revenue Procedure 92-64, or any subsequent Internal Revenue Service rulings or pronouncements, shall be null and void, and the closest alternative provision contained in Revenue Procedure 92-64 shall apply, if appropriate. Notwithstanding any provisions to the contrary, in the event of a Change in Control of the Company, if any benefits under the Plan are held in a “Rabbi Trust”, the assets transferred to the Rabbi Trust shall become irrevocably held by the Rabbi Trust and may not be recovered by the Company or any Related Entities, or used by the Company or any Related Entities for any corporate or other purposes.

6.2 Insurance. To cover all or part of its potential liabilities under the Plan, the Company may, but need not, purchase one or more life insurance policies on the lives of one or more Executives, but no Executive shall have any preferred claim for proceeds of any such policy or any beneficial ownership in any such policy as a result thereof. The Company makes no representation that it will use any life insurance policy acquired by it and insuring the life of an Executive to provide benefits under the Plan or that any such policy will, in any way, represent security for the payment of the benefits provided for under this Plan. No insurance policy or other asset acquired or held by the Company to support the Company’s obligations under the Plan shall be deemed to be held under any trust for the benefit of any Executive or Beneficiary or to be security for the performance of the obligations of the Company, but will be, and remain, a general, unpledged, unrestricted asset of the Company that may be used for any corporate purpose.

ARTICLE VII
CLAIMS PROCEDURE

7.1 Presentation of Claim. Any Participant or Beneficiary of a deceased Participant (such Participant or Beneficiary being referred to below as a “Claimant”) may deliver to the Committee a written claim for a determination with respect to the amounts distributable to such Claimant from the Plan. If such a claim relates to the contents of a notice received by the Claimant, the claim must be made within 60 days after such notice was received by the Claimant. All other claims must be made within 180 days of the date on which the event that caused the claim to arise occurred. The claim must state, in detail, the determination desired by the Claimant.

7.2 Notification of Decision. The Committee shall consider a Claimant’s claim within a reasonable time, and shall notify the Claimant in writing:

(a) That the Claimant’s requested determination has been made, and that the claim has been allowed in full; or

(b) That the Committee has reached a conclusion contrary, in whole or in part, to the Claimant’s requested determination, and such notice must set forth in a manner calculated to be understood by the Claimant:

(i) The specific reason(s) for the denial of the claim, or any part of it;

(ii) Specific reference(s) to pertinent provisions of the Plan upon which such denial was based;

(iii) A description of any additional material or information necessary for the Claimant to perfect the claim, and an explanation of why such material or information is necessary; and

(iv) An explanation of the claim review procedure set forth in Section 7.3 below.

7.3 Review of a Denied Claim. With 60 days after receiving a notice from the Committee that a claim has been denied, in whole or in part, a Claimant (or the Claimant’s duly authorized representative) may file with the Committee a written request for a review of the denial of the claim. Thereafter, but not later than 30 days after the review procedure began, the Claimant (or the Claimant’s duly authorized representative):

(a) May review pertinent documents;

(b) May submit written comments or other documents; and/or

(c) May request a hearing, which the Committee, in its sole discretion, may grant.

7.4 Decision on Review. The Committee shall render its decision on review promptly, and not later than 60 days after the filing of a written request for review of the denial, unless a hearing is held or other special circumstances require additional time, in which case the Committee’s decision must be rendered within 120 days after such date. Such decision must be written in a manner calculated to be understood by the Claimant, and it must contain:

(a) Specific reasons for the decision;

(b) Specific reference(s) to the pertinent Plan provisions upon which the decision was based; and

(c) Such other matters as the Committee deems relevant.

7.5 Legal Action. A Claimant’s compliance with the foregoing provisions of this Article is a mandatory prerequisite to a Claimant’s right to commence any legal action with respect to any claim for benefits under this Plan.

ARTICLE VIII
MISCELLANEOUS PROVISIONS

8.1 Benefits Non-Assignable. Neither a Participant nor any Beneficiary under the Plan shall have any right to assign, transfer, pledge or otherwise encumber the right to receive any benefits hereunder, and any attempted assignment, transfer, pledge or other encumbrance shall be null and void, and have no effect. Similarly, no rights under the Plan shall be subject to attachment or garnishment, or otherwise subject to liability for the debts, contracts, liabilities or torts by the creditors of any Participant or Beneficiary.

Notwithstanding the general inability to assign benefits under the Plan, consistent with IRS Notice 2002-31 and Revenue Ruling 2002-22, to the extent that a valid Property Settlement or Divorce Decree directs that any portion of a Participant’s benefits under the Plan be designated to a former Spouse, benefits shall be paid to the Spouse, at the same time benefits would otherwise have been payable to the Participant. In no event, shall any former Spouse obtain any additional rights to receive any form of distribution, or benefits payable in any manner not permitted under the Plan, or at any time earlier than when a Participant would otherwise have been entitled to receive such benefits.

8.2 Replacement of Other Benefits. The benefits provided under this Plan shall be in lieu of any other retirement, disability or death benefit provided by action of the Board or by agreement between the Company and a Participant that may exist from time to time, and in particular, any benefit provided by a resolution of the Board adopted May 11, 1979, other than (i) retirement, disability and death benefits available to Company employees generally, including, but not limited to, benefits payable under the Standard Microsystems Company Incentive Savings and Retirement Plan, (ii) life insurance policies purchased for Executives under the executive life insurance program, (iii) disability benefits payable under the Company’s officers’ disability insurance program, and (iv) a written employment agreement which expressly provides that the benefits payable thereunder are in addition to the benefits payable under this Plan.

8.3 Employment Not Guaranteed by Plan. Participation in the Plan shall not be deemed to be consideration for, or an inducement to, or a condition of the employment of any employee. Nothing contained in this Plan shall be deemed to give any Participants the right to be retained in the employment of the Company, nor shall any Participant, retired Participant, deceased Participant, disabled Participant, or terminated Participant have any right to any payment, except as such payment may be provided under the terms of the Plan.

8.4 Withholding. The Company shall be entitled to deduct from all benefit payments made to a Participant or any Beneficiary all applicable federal, state or local taxes required by law to be withheld from such payments.

8.5 Cooperation of Participant. If so requested by the Company, a Participant shall take whatever actions may be reasonably necessary to enable the Company to timely apply for and acquire insurance, which the Company may purchase to finance operation of the Plan.

8.6 Fiduciary And Administrator. The Administrator shall be the Plan administrator, agent for legal process and fiduciary, for purposes of ERISA. The Administrator may use agents, may allocate its responsibilities to others and may exercise any other powers necessary for the discharge of its duties to the extent not in conflict with the provisions of ERISA. The Company, in its discretion, may obtain one or more policies of insurance, insuring Committee members and. any employees of the Company to whom any responsibility with respect to the administration of the Plan has been delegated, against any and all costs, expenses and liabilities (including attorneys’ fees) incurred by such persons as a result of any act, or omission to act, in connection with the performance of their duties, responsibilities and obligations under the Plan and any applicable law. To the extent that the Company does not obtain such insurance, the Company shall indemnify and hold such parties harmless in the same manner and to the same extent as directors and officers of the Company, subject to any limitations imposed by law on such indemnification.

8.7 Payment of Benefit of Incompetent. In the event the Administrator finds that a Participant or Beneficiary is unable to manage his affairs because of minority, illness, accident, or other reason, any benefits payable hereunder may, in the discretion of the Administrator, be paid to a spouse, child, parent, or other relative or dependent or to any person found by the Administrator to have incurred expenses for the support and maintenance of such Participant or Beneficiary; and any such payments so made shall be a complete discharge of all Company liability therefore.

8.8 Change of Business Form. In the event of any consolidation, merger, acquisition or reorganization of the Company (or a portion thereof), the obligations of the Company under this Plan shall continue and be binding upon the Company and its successors. The Company shall not cease its business activities or terminate its existence without having made adequate provisions for the fulfillment of its obligations hereunder.

8.9 Amendment and Termination of Plan. The Board, in its sole discretion, may amend or terminate the Plan at any time, and from time to time; provided, however, that no Plan amendment or termination shall, without the consent of the affected Participant, reduce or eliminate (i) any benefit that has begun to be paid or (ii) with respect to a Vested Participant, any benefit, whether or not it has begun to be paid (determined without taking into account future increases in the Participant’s salary). Notwithstanding the foregoing, the Board may make any amendment which is necessary or appropriate to ensure that the Plan be treated as an unfunded plan which provides benefits for a “select group of management or highly compensated employees” within the meaning of Sections 201, 301, and 401 of ERISA.

8.10 Plan Document Controlling. All provisions of the Plan shall be controlled by this Plan document and all prior Plan documents, Amendments and Board Resolutions shall be superceded by this document.

8.11 Severability. In the event that any one or more provision of the Plan or any action taken pursuant to the Plan should, for any reason, be unenforceable or invalid in any respect under the laws of the United States, any state of the United States or any other government, such unenforceability or invalidity shall not affect any other provision of the Plan, but in such particular jurisdiction and instance the Plan shall be construed as if such unenforceable or invalid provision had not been contained therein or as if the action in question had not been taken thereunder.

8.12 Administration. The Administrator shall have the power to delegate specific responsibilities. Such delegations may be to officers or employees of the Company or to other individuals, all of whom shall serve at the pleasure of the Administrator and, if full-time employees of the Company, without additional compensation.

8.13 Consequences of a Violation. All Participants shall be informed that they may voluntarily participate in the SERP, after being notified of their eligibility to participate in the SERP. All Participants shall be notified of the potential tax consequences under Section 409A, if the provisions of the Plan and Section 409A are not followed, including the imposition of immediate income taxes, a 20% excise tax, underpayment of interest penalties, and Form W-2 reporting. All Participants shall also be informed that the amount of their benefits under the Plan shall be reported to the IRS, as required for nonqualified deferred compensation programs. Furthermore, Participant shall be informed that when their benefits become vested under the Plan, and not subject to any substantial risk of forfeiture under Sections 3121(v) and 3306(r) and other provisions of the Code, the Participants shall be subject to FICA and all related taxes.

8.14 Gross-Up for Section 409A Violations. In the event of a violation of Section 409A of the Code, it is not the intent of the Company for a Participant who is an active employee within 1 year of any violation (or a former employee who is an active member of the Board within 1 year prior to any violation) to incur the excise tax and other penalties under Section 409A. Accordingly, to the extent any excise taxes or underpayment of interest or penalties under Section 409A apply, the Company shall make a “gross up” payment to the Participant, to offset the effect of any excise tax, interest or penalties incurred in accordance with Section 409A of the Code, and any tax on such gross up payments, to the extent such action is legally permitted. All gross up payments set forth in this Plan shall be made as soon as legally permitted under Section 409(A) of the Code, but in no event later than 2 1/2 months following the end of the fiscal year in which the event giving rise to such payment occurs, and, if permissible, before the excise tax becomes due.

8.15 Specified Employees. The Company has its stock traded on an established securities market. Accordingly, “Specified Employees” shall exist under Section 409A, for whom benefit payments may not be made for a 6 month period after a Separation from Service occurs.

8.16 No Linked Plans. The Company also maintains the SMSC Section 401(k) Savings Plan (the “SMSC 401(k) Savings Plan”). Employee Salary and Bonus Deferral Elections under the SERP are made independent of any elections under the SMSC Section 401(k) Plan. In addition, distribution elections are made separately between the SERP and the SMSC 401(k) Plan. Accordingly, for purposes of Section 409A, the SERP and the SMSC 401(k) Plan are “not” linked plans.

8.17 Top Hat Plan. ERISA generally applies to protect the interests of “employees”, and DOL Regulation Section 2520.104-23 establishes rules for certain arrangements that provide benefits for a select group of management or Highly Compensated Employees, referred to as “Top Hat” programs. This Plan is intended to be a Top Hat program under ERISA. In determining if the Plan satisfies all rules to be classified as a Top Hat program, or in reviewing the number of Participants in the Plan for any reasons, all employees of the Company and any Related Entities, whether foreign or Domestic, shall be taken into consideration.

8.18 Compliance With the Code. The SERP is intended to comply with the provisions of Section 409A of the Code, and all guidance issued thereunder. If there is any discrepancy between the provisions of this SERP and the provisions of Section 409A, this discrepancy shall be resolved in a manner as to give full effect to the provisions of Section 409A of the Code.

8.19 Annual Statement. Participants shall receive an annual statement after the end of each Plan Year, confirming the amounts credited to each Participant’s Account.

8.20 Form of Communication. Any election, claims, notice or other communication required or permitted to be made a Participant under this Plan shall be made in writing and in such form as shall be prescribed by the Committee. Such communication shall be effective upon receipt, if hand delivered or sent by first class mail, postage pre-paid, return receipt requested to Standard Microsystems Corporation, Attention: Vice President of Human Resources, 80 Arkay Drive, Hauppauge, New York 11788.

8.21 Gender and Number. The masculine gender, where appearing herein, shall be deemed to include the feminine gender, and the singular shall be deemed to include the plural, unless the context clearly indicates to the contrary.

8.22 Captions. The captions at the head of a paragraph of this Plan are designed for convenience of reference only and are not to be resorted to for the purpose of interpreting any provision of this Plan.

8.23 Expenses. All expenses incurred in administering the Plan shall be paid by the Company.

8.24 Plan Interpretation. The Administrator shall have complete discretion to interpret all provisions of the Plan and to establish reasonable rules and procedures to facilitate the administration of the Plan. However, the Plan is intended to comply with Section 409A and shall be interpreted consistent with the provisions of Section 409A.

8.25 Binding Agreement. The provisions of this Plan shall be binding upon the Participant and the Company and their successors, assigns, heirs, executors and beneficiaries.

8.26 Governing Law. Except to the extent preempted by federal law, the Plan shall be governed by and construed in accordance with the laws of the State of New York.

8.27 Notice and Inquiries. All notices to the Company may be addressed as follows:

Vice President of Human Resources
Standard Microsystems Corporation
80 Arkay Drive
Hauppauge, NY 11788
(631) 434-4600

The Company shall provide each Participant with written notice by registered mail, at the last address it maintains for each Participant, of any change in the above contact information for the Company.

IN WITNESS WHEREOF, SMSC has adopted this Plan effective as of the day and year first written above.

STANDARD MICROSYSTEMS CORPORATION

By: /s/ Christine King
Date:	November 7, 2008

Exhibit 10.2

STANDARD MICROSYSTEMS CORPORATION
SEVERANCE PLAN

WHEREAS, Standard Microsystems Corporation (“SMSC” or the “Company”) maintains the Standard Microsystems Corporation Severance Plan (the “Severance Plan” or “Plan”); and

WHEREAS, SMSC acknowledges that the Severance Plan is a “welfare plan” as defined under Section 3(1) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”); and

WHEREAS, the American Jobs Creation Act of 2004 (“AJCA”) enacted new Section 409A of the Internal Revenue Code (the “Code”), imposing new rules for all forms of deferred compensation, including benefits under the SMSC Severance Plan; and

WHEREAS, the Severance Plan was amended by execution of Amendment Number 1 on March 22, 2007, to be in compliance with Section 409A of the Code; and

WHEREAS, the Final Regulations under Section 409A were issued after the Severance Plan was amended; and

WHEREAS, SMSC wished to amend and restate the Severance Plan to comply with Section 409A of the Code, including all IRS announcements and notices, and the Final Regulations issued under Section 409A; and

WHEREAS, due to the brevity of the Plan, this document shall serve as both the Plan document and the Summary Plan Description for the Severance Plan; and

WHEREAS, Section 22 of the Severance Plan retained the right for SMSC to amend, modify or terminate the Plan.

NOW, THEREFORE, the Plan is amended and restated as follows:

1. Effective Date. The Plan became effective as of January 1, 1986. The Plan shall be amended and restated effective as of December 31, 2008 to comply with Section 409A of the Code. SMSC can demonstrate its good faith compliance with Section 409A from January 1, 2005 to December 31, 2008, as permitted under the Final Treasury Regulations issued under Section 409A of the Code.

2. Plan Year. The Plan Year shall be the calendar year.

3. General Definitions.

a. “Base Salary” shall mean an eligible employee’s regular salary as determined in accordance with SMSC’s payroll records, excluding any bonuses, commissions, taxable or non-taxable fringe benefits, car or other allowances, and any other forms of compensation.

b. “Committee” means the Section 401(k) Committee established for purposes of the SMSC Section 401(k) Savings Plan.

c. “Disability” means a Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment, which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, as determined by an independent third party physician, selected within the discretion of the Committee. The determination of whether a Participant is Disabled shall be determined by the Committee, in its sole discretion, but subject to the provisions of Section 409A.

d. “Employee” shall mean any individual employed directly by SMSC or any Related Company regularly scheduled to work at least 30 hours per week, excluding any part time, temporary, seasonal, and leased employees, and excluding any independent contractors and consultants.

e. “Key Employee” means an individual as described in Section 416(i) of the Code, determined without regard to Section 416(i)(5) thereof. For purposes of this provision, a Key Employee is an officer earning over $140,000 in 2006, $145,000 in 2007, $150,000 in 2008 and $165,000 in 2009 (with a limit of no more than 50 employees, or if less, the greater of 3 or 10% of all employees); a 5% owner; or a 1% owner having annual compensation of more than $150,000. All amounts shall automatically be increased as provided under the Code for cost of living or other charges.

f. “Participating Company” shall mean any Related Company located in the United States.

g. “Related Company” means any entity that is within SMSC’s “controlled group”, as defined under Section 1563 of the Code.

h. “Separation from Service” shall have the meaning set forth in Section 409A of the Code and the regulations thereunder. Consistent with Final Treasury Regulation Section 1.409A-1(h), or any subsequent guidance under Section 409A of the Code, no Separation from Service shall occur if an Eligible Employee continues to perform services as a consultant or an Employee in accordance with the following rules:

i. Leave of Absence. For purposes of Section 409A, the employment relationship is treated as continuing in effect while a Eligible Employee is on military leave, sick leave, or other bona fide leave of absence, as long as the period of leave does not exceed 6 months, or if longer, as long as the Eligible Employee’s right to reemployment with the Employer provided either by statute or contract. Otherwise, after a 6 month leave of absence, the employment relationship is deemed terminated.

ii. Part-Time Status. Whether or not a termination of employment occurs is determined based upon all facts and circumstances. However, in the event that services provided by an Eligible Employee are insignificant, a Separation from Service shall be deemed to have occurred. For purposes of Section 409A, if an Eligible Employee is providing services to SMSC or any Related Entities at a rate that is at least equal to 20% of the services rendered, on average, during the immediately preceding 3 full calendar years of employment (or such lesser period), and the annual compensation for such services is at least 20% of the average annual compensation earned during the final 3 full calendar years of employment (or such lesser period), no termination shall be deemed to have occurred since such services are not insignificant.

iii. Consulting Services. Where an Eligible Employee continues to provide services to SMSC or any Related Entities in a capacity other than as an employee, a Separation from Service shall not be deemed to have occurred if the Eligible Employee is providing services at an annual rate that is 50% or more of the services rendered, on average, during the immediately preceding 3 full calendar years of employment (or such lesser period) and the annual remuneration for such services is 50% or more of the annual remuneration earned during the final 3 full calendar years of employment (or such lesser period).

i. “Service Date” means an Eligible Employee’s initial date of hire or any re-hire date, if later. In certain instances (which must be approved in writing by the CEO or the Vice President of Human Resources of SMSC), Eligible Employees may be granted past service credit with former employers. In this event, the Service Date may be determined prior to an Eligible Employee’s date of hire or re-hire with SMSC, within SMSC’s discretion or the provisions of any acquisition or other agreement.

j. “Specified Employee” means a Key Employee who is employed by SMSC or any Related Entities which has its stock publicly traded on an established securities market. For purposes of the Plan, the Specified Employee Identification Date shall be each December 31, and the Specified Employee Effective Date shall be the first day of the fourth month following the Specified Employee Identification Date (i.e., each April 1). Specified Employees shall be determined by an officer of SMSC on an annual basis for purposes of all nonqualified deferred compensation plans and any other programs in accordance with the provisions of Section 409A of the Code.

4. Eligibility for the Basic Severance Benefit. All Employees (other than excluded employees) of SMSC and any Participating Companies are eligible for the Basic Severance Benefit described in Section 5 (the “Basic Severance Benefit”), unless benefits are otherwise precluded under the terms of this Plan. Employees satisfying these requirements shall be referred to as “Eligible Employees.” Notwithstanding any provision to the contrary, however, in no event shall any Basic Severance Benefits under the Plan be provided to individuals who are hired as temporary employees for a specified period of time; are offered but refuse to accept another suitable position within the organization; or who are provided the opportunity to be retained for any length of time by any successor employer or entities. Nor shall any Basic Severance Benefits be payable to any Eligible Employees who are eligible for any Executive Severance Benefits or who have a separately negotiated employment or severance agreement with SMSC, to the extent that such Executive Severance Benefits or benefits under a separately negotiated employment or severance agreement equal or exceed the Basic Severance Benefit.

5. Basic Severance Benefits.

a. Cash Benefits. Eligible Employees shall be entitled to a severance benefit equal to 1/2 of a week’s base pay for each 6 months of Continuous Service measured from an Eligible Employee’s Service Date up to 15 years of service. As a result of the preceding Severance Benefit Formula, the maximum benefit that any Eligible Employee shall receive under the Severance Plan, exclusive of employees receiving benefits under Section 8, shall be a maximum benefit of 15 weeks for any Eligible Employees who have completed 15 Years of Service or more. In determining Continuous Service for purposes of computing severance benefits, all periods of time from an individual’s Service Date during which an eligible employee is “actively at work” shall be taken into consideration, regardless of the actual hours worked in any period of time, plus any leave time taken under the Family Medical Leave Act. Thus, any periods during which an Eligible Employee is absent from work, other than Family Medical Leaves, shall not be considered in determining Continuous Service. No severance benefits shall be paid under the Plan for any partial periods.

Notwithstanding any provision to the contrary, all Eligible Employees shall be paid a “Minimum Benefit” equal to 2 weeks of base pay. This Minimum Benefit is inclusive of the severance benefit determined above, based upon an Eligible Employee’s Continuous Service, and shall not be paid in addition to any benefits based upon Continuous Service.

b. COBRA Benefits. As an additional severance benefit, whether an employee receives the Basic Severance Benefit or the Executive Severance Benefit, SMSC shall also pay for 100% of the cost of any continuation health coverage if elected under COBRA, by the employee or any qualified beneficiaries, for coverage in existence at the time of any qualifying event, for a period of 3 months following any termination of employment of an employee. The payment of any COBRA premiums shall not extend the period of any COBRA entitlement, and shall only apply for coverage in effect at the time of a termination, for which COBRA election rights exist.

c. No Deferred Compensation. The continuation of benefits under COBRA and other benefits must be incurred and paid by December 31 of the second calendar year following the calendar year in which a separation from service occurs. To the extent that any benefits would extend beyond this period, a single lump cash payment will be made as of the applicable December 31, in order to avoid any further deferrals of compensation.

d. Other Benefits. Other than medical coverage (including dental, vision, prescription drug and similar coverage, all other benefits, such as group-term life insurance, long-term disability, short-term disability and other welfare benefits, shall be terminated in accordance with the provisions of all plans, with any applicable individual conversion rights.

6. Entitlement to Basic Severance Benefits. An Eligible Employee shall be entitled to the Basic Severance Benefits if an Eligible Employee’s employment is involuntarily terminated with SMSC, unless such termination is for “Cause” as defined below in this Section 6. In the event of a termination for “Cause”, including unsatisfactory job performance, no Basic Severance Benefits shall be paid.

For purposes of this Plan the term “Cause” shall include, but not be limited to the following: any material violation of the terms of any of SMSC’s personnel policies or procedures; any material misstatement contained in the Eligible Employee’s employment application; commission by the Eligible Employee of any crime or fraud against SMSC or its property or any crime involving moral turpitude or reasonably likely to bring discredit upon SMSC; unsatisfactory job performance; material failure to perform or meet standards of performance established by SMSC with respect to any services to be provide by the Eligible Employee; and any violation of SMSC’s operating policies.

7. Eligibility for the Executive Severance Benefit. Employees who may be eligible for the Executive Severance Benefit (the “Executive Benefit”) shall include Divisional Vice Presidents, Vice Presidents, Senior Vice Presidents, Executive Vice Presidents, Presidents, Chief Operating Officer, Chief Executive Officer, Chief Financial Officer, and any other key employees specifically identified by SMSC to receive the Executive Benefit, in writing. SMSC retains the discretion to identify any employees for the Executive Benefit who are employed by SMSC or any Related Entities as a result of any acquisitions. However, to the extent any executives are covered under any separately negotiated employment or severance agreements, that provide for any severance benefits, such individuals shall be excluded from participation in the Executive Benefit, and the Severance Plan, until such individuals are informed, in writing by the SMSC Chief Executive Officer, of their eligibility for participating in the Severance Plan. Individuals who are specifically excluded from the benefits as of the effective date of this amended and restated Severance Plan are identified in separate corporate records and agreements.

Notwithstanding any provisions to the contrary, in no event shall any benefits under the Severance Plan or this Amendment be provided to any individuals who are offered but refused to accept another suitable position within SMSC, or who are provided the opportunity to be retained for any length of time by any successor employer, joint venturer, etc., except with regard to any relocations addressed below.

8. Executive Severance Benefit. Eligible Employees for the Executive Benefit shall receive an Executive Severance Benefit equal to three (3) months of Base Salary upon the occurrence of required “Relocation” as defined in Section 9(a) of this Plan or the occurrence of “Other Events” as defined in Section 9(c) of this Plan. Eligible Employees for the Executive Benefit shall receive an Executive Severance Benefit equal to six (6) months of Base Salary upon the occurrence of “Change in Control” as defined in Section 9(b) of this Plan.

The above Executive Benefit shall be provided in lieu of the Basic Severance Benefit provided under the Severance Plan based upon an employee’s Years of Continuous Service with SMSC, and in no event shall be paid in addition to any other severance benefits under the SMSC Severance Plan or any individually negotiated employment or severance agreements. Furthermore, under the Executive Severance Benefit, no “Minimum Benefits” shall exist, such as the 2 week Minimum Benefit provided under the Basic Severance Benefit. However, in the event the Basic Severance Benefit for any Eligible Employee under this Severance Plan is greater than the Executive Benefit, an executive employee shall be entitled to the greater of such benefits.

9. Entitlement to Executive Severance Benefits. The provisions of the Severance Plan shall be controlling with regard to the entitlement of any Executive Severance Benefits. Therefore, no Eligible Employee who is terminated “for Cause”, including unsatisfactory job performance shall be entitled to receive any benefits, consistent with the provisions of this Severance Plan. However, Eligible Employees shall be entitled to the Executive Benefit upon the occurrence of any of the following events:

a. Relocation. If an Eligible Employee is required to relocate to a new position that is more than 75 miles from the location of the employee’s employment prior to such written required relocation, the employee may, within 90 days from receipt of such notification and prior to receipt of any relocation expenses by SMSC, inform SMSC, in writing, of the employee’s desire to terminate employment with SMSC or any Related Entity, and to receive the Executive Benefit.

b. Change in Control. Upon the occurrence of a “Change in Control” of SMSC, including any affiliated or subsidiary companies, in which any eligible employees are employed, followed by a reduction in an employee’s Base Salary by more than 15%, or any significant reduction (greater than 25%) in any targeted incentive compensation or bonuses, (i.e., as a percentage of Base Salary) as of the date of any Change in Control or an involuntary termination of the employee’s employment, other than for “Cause” or retirement or Disability, an eligible employee shall be entitled to the Executive Severance Benefit in accordance with Section 9(d) below.

A “Change in Control” of SMSC shall be deemed to have occurred upon the occurrence of one of the following events:

i. The first to occur of any event described as either a change in ownership or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company, as defined under Section 409A of the Code.

Notwithstanding the preceding paragraphs of this Section 9, in the event that: (i) the aggregate payments of benefits to be made or afforded to any employee under this Amendment (the “Termination Benefits”) would be deemed to include an “excess parachute payment” under Section 280G of the Code or any successor thereto; and (ii) if such Termination Benefits were reduced to an amount (the “Non-Triggering Amount”), the value of which is $1 less than an amount equal to the total amount of any payments permissible under Section 280G of the Code or any successor thereto; then the Termination Benefits to be paid to any employee shall be so reduced so as to be a Non-Triggering Amount. Any allocations of any reductions required hereby among the Termination Benefits, in accordance with the proceeding paragraphs of this Section 9, shall be determined by SMSC, within its discretion.

c. Other Events. Eligible Employees shall also be entitled to the Severance Benefits identified in this Plan, under any corporate transactions or events as provided in the Severance Plan, including any involuntary termination of employment without cause.

d. Good Reason Termination. Section 9 provides that an Eligible Employee who is an executive may terminate the Eligible Employee’s employment for “Good Reason”.

In order to comply with the safe harbor “Good Reason” provisions contained in Final Treasury Regulation Section 1.409A-1, the Eligible Employee’s Separation from Service shall be “treated” as an involuntary termination if the following “safe harbor” events occur to ensure that a Good Reason termination exists:

i. The Eligible Employee must separate from service within a limited period of time, not to exceed 60 days following the reason for the Good Reason termination.

ii. The amount, time and form of payment upon a voluntary separation from service for Good Reason shall be identical to the amount, time and form of payment upon an involuntary Separation from Service.

iii. The Eligible Employee must provide notice of the existence of the Good Reason condition within a period not to exceed 30 days of its initial existence.

iv. The Company shall be provided a period of 30 days during which it may remedy the condition entitling the Eligible Employee to terminate employment for Good Reason.

10. Termination of Severance Benefits. Notwithstanding any provisions to the contrary, in the event that an employee is receiving any severance benefits on a periodic basis, and if such an employee obtains new employment during the period in which severance benefits would otherwise be paid, all severance benefits shall immediately be terminated and no further severance benefits shall be due and payable.

11. Payment of Benefits. All benefits shall be paid on a weekly, bi-weekly or monthly basis in accordance with the Company’s regular payroll practices, which date shall be treated as a “fixed payment date” for purposes of Section 409A. Payment shall commence no later than the March 15 of the calendar year following the Plan Year in which a Separation from Service occurs, provided the Employee executes and returns a Release within the applicable time limitations prior to such date. However, any severance benefits shall be reduced to the extent of any advance payment under any sales or commission program, for any excess expense reimbursements, and for any amounts owed to SMSC by the Employee (to the extent permitted under state law). Furthermore, payment of any severance benefits is contingent upon the return of any SMSC property in the possession of the Employee, including personal computers (“PCs”), fax machines, scanners, copiers, building access passes and keys, cellular phones, SMSC credit cards, and any SMSC documents, correspondence, proprietary information and related corporate materials or equipment.

a. Section 409A. In the event that any termination would cause any payments to be paid beyond 21/2 months following the end of the Plan Year in which a termination occurs, a final payment equal to the balance owed shall be made prior to the 21/2 month period following the applicable Termination Date, in order to rely upon the “short-term deferral rule” under Section 409A to avoid any unintended form of deferred compensation.

b. Delay in Payment for Specified Employees. To the extent that an Eligible Employee would receive any payment hereunder that would violate Section 409A, in no event shall any such payment be made within 6 months after the Eligible Employee’s Separation from Service. Any and all payments that are required to be made within such 6 month period shall be delayed until the first day of the 6 months after a Separation from Service occurs and shall retroactively be paid to make the Employee whole for any lost benefits. To the extent that an Eligible Employee is required to pay for the cost of any health or other benefits to keep them in full force and effect during the 6 month delay period for Eligible Employees, the Eligible Employee shall also be reimbursed for such out-of-pocket expenses as of the first day of the 6 months after a Separation from Service, retroactively, to make the Eligible Employee whole for any out-of-pocket costs. To the extent any payments are delayed for any Eligible Employees, they shall receive interest on such delayed payments equal to the prime rate determined as of the first day of the month in which a Separation from Service shall occur, plus 2%.

c. Exception for Specified Employees. Notwithstanding any provision to the contrary, in accordance with the Final Regulations issued under Section 409A of the Code, to the extent that the severance benefits to a Specified Employee do not exceed the lesser of the Specified Employee salary for the past 2 years or the Section 401(a)(17) limitations, such amount shall be paid within the 6 month period of time during which benefits may generally not be paid to Specified Employees. To the extent benefits exceed such limitations (which is a maximum of $460,000 in 2008 and $490,000 in 2009), the balance of any payments shall be made following the expiration of the 6 month period following a Termination Date and a Separation of Service in a single lump sum payment on the first day of the 6 months following a Separation from Service, with interest equal to prime plus 2% for the delay in making payments as required under the Severance Plan.

12. Covenant Not to Compete. Eligible Employees shall agree that during a period of 6 months after an employee’s Separation from Service, the employee shall not, directly or indirectly, through any other person, firm, corporation or other entity, be employed by or engaged as a consultant or independent contractor to any business entity engaged in a business that is a competitor of SMSC, or any related entities, anywhere in the United States. For purposes of this Plan, a business entity shall be considered to be a competitor with SMSC, and all related entities, if it is engaged in any of the following activities: the marketing, sale, design, development, manufacture or assembly of any integrated circuit or related product competing with an integrated circuit or related product then offered by SMSC without written consent which will not be unreasonably withheld if it is a non-competitive situation.

Eligible employees shall acknowledge in the Release required under Section 15 that the scope of this covenant not to compete is reasonable. In the event that any aspect of this covenant is deemed to be unreasonable by a court, an Eligible Employee shall submit to the reduction of either the time or territory to such an area or period as the court will deem reasonable. In the event an Eligible Employee violates this covenant, then the time limitation shall be extended for a period of time equal to the pendency of such proceedings, including appeals.

13. Nonsolicitation of Clients. For a period of 1 year after the Eligible Employee’s Separation from Service, the Employee shall not, directly or indirectly, through any other person, firm, corporation or other entity, solicit any customers or clients of SMSC, in order to receive the severance benefits.

Eligible Employees shall acknowledge that the scope of this nonsolicitation provision is reasonable. In the event that any aspect of this provision is deemed to be unreasonable by a court, an Eligible Employee shall submit to any reductions as the court shall deem reasonable. In the event the Eligible Employee violates this provision, then the time limitations shall be extended for a period of time equal to the pendency of such proceedings, including appeals.

14. No Solicitation of Employees. During the course of an Eligible Employee’s employment with the Company, the Employee shall come into contact and became familiar with the Company’s employees, their knowledge, skills, abilities, salaries, commissions, draws, benefits, and/or other matters with respect to such employees, all of which information is not generally known to the public, but has been developed, acquired or compiled by the Company at its great effort and expense. Eligible Employee shall agree that any solicitation, luring away or hiring of such employees of the Company shall be highly detrimental to the business of the Company and may cause serious loss of business and great and irreparable harm. Consequently, Eligible Employees shall agree that for a period of 1 year after the Eligible Employee’s Separation from Service, the Eligible Employee shall not, directly or indirectly, whether on behalf of the Eligible Employee or others, solicit, lure or hire away any employees of the Company or assist or aid in any such activity.

15. Conditions for Payment. As a condition precedent to the payment of any Basic or Executive Severance Benefits, inclusion of the 2 week “Minimum Payment” and any COBRA coverage, SMSC shall require an Eligible Employee to sign a Severance Agreement and General Release (the “Release”) within 30 days of the date of the Eligible Employee’s separation from service (the “Release Period”). The Release shall require the Eligible Employee to agree to release SMSC, any Related Companies, and the employees and directors of any and all Related Companies, from all claims or demands the Eligible Employee may have based on employment with SMSC, including claims of which the Eligible Employee is unaware and claims which are not specifically released and identified below. These claims include, but are not limited to, claims arising under the Constitution of the United States, a release of any rights or claims the Employee may have under the Age Discrimination in Employment Act of 1967 as amended, 29 U.S.C. 621 et seq., which prohibits age discrimination in employment; Title VII of the Civil Right Act of 1964, as amended, 42 U.S.C. 2000(e) et seq., which prohibits discrimination in employment based on race, color, national origin, religion or sex; the Civil Rights Act of 1966, 42 U.S.C. 1981 et seq.; the Equal Pay Act, which prohibits paying men and women unequal pay for equal work; or any other federal, state or local laws or regulations prohibiting employment discrimination; Employee Retirement Income Security Act, 29 U.S.C. 1001 et seq.; Executive Orders 11246 and 11141; the Constitution of the State of New York or any other states in which the Eligible Employee resides or works; any New York or other state laws against discrimination; any express or implied contracts with SMSC or any Related Company; any federal or state common law and any federal, state or local statutes, ordinances and regulations. The Release may include other provisions not stated herein. Any payment that otherwise would be made to the Eligible Employee prior to his delivery of such executed release shall be paid to the Eligible Employee on the first business day following the conclusion of the Release Period.

The Release shall not include, however, a release of (a) the Eligible Employee’s right, if any to any other pension, health or similar benefits under SMSC’s standard policy and procedures programs; or (b) the Eligible Employee’s right to individual conversion privileges under any medical, dental, long-term disability, life insurance or any other welfare programs.

16. Corporate Acquisitions and Transactions. The intent of the Plan is to compensate Eligible Employees with long-term employment with SMSC, if the need to terminate an Eligible Employee or to eliminate a position occurs. In the event that an Eligible Employee working for SMSC or any Related Company is subsequently offered employment by any related or unrelated entities as a result of any corporate transaction or reorganization, no severance benefits shall be payable whether or not the individual continues to work for the buyer or any other successor entity in any corporate acquisition or other transaction, whether or not such offers or positions are at comparable wages or job levels.

17. ERISA Compliance. Notwithstanding any provisions to the contrary, in no event shall any severance benefit exceed 2 times an Eligible Employee’s annual compensation paid during the Plan Year immediately preceding the termination of the Eligible Employee’s services. Furthermore, in no event shall severance benefits be paid for a period of more than 24 months after an Eligible Employee’s termination of employment. These rules are intended to comply with Department of Labor Regulation Section 2510.3-2.

18. Older Workers Benefits Protection Act. With regard to each individual Severance Agreement and General Release required under Section 15, SMSC shall give consideration to requiring either a 21 day review period for individual and independent terminations, or use of a 45 day review period for significant reductions in force. Separate Severance Agreements and General Release forms may be used with different employees in order to effectuate the intent of the Severance Plan and/or to provide additional severance benefits in order to accommodate the unique circumstances of any individual terminations.

19. WARN Notices. Prior to the effectuating any significant reduction in force, SMSC shall give consideration as to whether or not any notifications are required to employees and/or local officials under the Workers’ Adjustment and Retraining Notification Act of 1990 (“WARN”). Furthermore, prior to effectuating any reduction in force that may require issuance of WARN Notices, SMSC may terminate the Severance Plan in order to avoid the duplication of providing either 60 days of notice and/or 60 days of pay, in addition to any severance benefits that may be required under the terms of the SMSC Severance Plan.

20. Violation of Section 409A. All Eligible Employees shall be informed that in the event of any violation of Section 409A of the Code, severance and other payments may be subject to income taxes, a 20% excise tax, and underpayment of interest penalties. However, the Plan and any Release are intended to comply with Section 409A and shall be interpreted consistent with the provisions of Section 409A.

21. Plan Unfunded. The Plan shall be unfunded for purposes of the Code and Title I of ERISA, and no assets shall be set aside for the payment of benefits under the Plan. All participants are general creditors of SMSC for the payment of any benefits.

22. Amendment and Termination. The Plan may be amended, modified, or terminated at any time, by action of the Compensation Committee of the Board of Directors of the Company.

23. Nonassignability. No benefits provided under the Plan may be assigned or transferred, and no benefits are subject to attachment. However, in the event of death of an Employee receiving severance benefits, the benefits shall continue to be paid to the Employee’s Spouse, or if no Spouse exists, the Employee’s estate as income in respect of the decedent.

24. Plan Interpretation. SMSC shall have complete discretion to interpret all provisions of the Plan and to establish reasonable rules and procedures to facilitate the administration of the Plan.

25. Claims and Review Procedures. SMSC hereby adopts the following claims procedures to review all claims for benefits under the Plan, in accordance with Department of Labor Regulation 29 CFR §2560.503-1:

a. Benefit Claims. Claims for benefits shall be made in writing to the Employer, or, in the event the Employer contracts with a person or corporation to process claims for any benefits, claims for such benefits shall be forwarded to such person or corporation as designated by the Employer. Whoever is designated to process claims for benefits, whether the Employer, or any other person, shall be referred to as the “Claim Coordinator” in this Claims Procedure.

The “Claim Coordinator” shall make all determinations as to the right of any claimant to a benefit under the Plan. If the “Claim Coordinator” denies in whole or in part any claim for a benefit under the Plan the “Claim Coordinator” shall furnish the claimant with notice of the decision not later than 90 days after receipt of the claim by the “Claim Coordinator”, unless special circumstances require an extension of time for processing the claim. If such an extension of time for processing is required, written notice of the extension shall be furnished to the claimant prior to the termination of the initial 90-day period. In no event shall such extension exceed the period of 90 days from the end of such initial period. The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the processor expects to render the final decision. If no notice of a decision or extension is provided, the claimant shall assume the claim has been denied.

The written notice which the processor shall provide to every claimant who is denied a claim for benefits shall be set forth in a manner calculated to be understood by the claimant:

i. The specific reason or reasons for the denial;

ii. Specific reference to pertinent Plan provisions on which the denial is based;

iii. A description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary; and

iv. Appropriate information as to the steps to be taken if the claimant wishes to submit his claim for review.

A claimant or his authorized representative may request the Appeals Committee to review the denial of a claim by the “Claim Coordinator”. The Appeals Committee shall be established by the Employer as the “Named Appeals Fiduciary”, as required under ERISA for reviewing claims. Such request shall be made in writing and shall be presented to the Appeals Committee not more than 60 days after receipt by the claimant of written notification of the denial of a claim. The claimant shall have the right to review pertinent documents and to submit issues and comments in writing. The Appeals Committee shall make its decision on review not later than 60 days after receipt by the Appeals Committee of the claimant’s request for review, unless special circumstances require an extension of time, in which case a decision shall be rendered as soon as possible by not later than 120 days after receipt by the Appeals Committee of the request for review. If such an extension of time for review is required because of special circumstances, written notice of the extension shall be furnished to the claimant prior to the commencement of the extension. The decision of review shall be in writing and shall include specific reasons for the decision, written in a manner calculated to be understood by the claimant, and specific references to the pertinent Plan provisions on which the decision is based.

b. Compliance with Regulations. It is intended that the claims procedure of this Plan is administered in accordance with the claims procedure regulations of the Department of Labor set forth in 29 CFR Section 2560.503-1. Accordingly, the above claims procedures shall be required to the extent necessary to comply with any future laws, regulations or announcements.

26. Withholding of Taxes. SMSC shall deduct from all severance payments made to any Eligible Employee all applicable federal, state or local taxes required by law to be withheld from such payments.

27. Retirement and Other Benefits. Severance benefits shall not be treated as “Compensation” under the terms of any qualified retirement plans. Nor shall the payment of any severance benefits be treated as extending any individual’s employment, for any employee benefit or employment purposes.

28. Other Covenants. Notwithstanding any provisions to the contrary, to the extent that any longer periods are used for any covenants not to compete or solicit customers or employers, within any other employment agreements, severance agreements, or offer letters, the longer period shall be controlling for purposes of any Eligible Employee.

29. Employment and Severance Agreements, and Offer Letters. Sections 4 and 7 of the Severance Plan provides that to the extent an Eligible Employee is entitled to any severance benefits under any separately negotiated agreements, no benefits are payable under the Severance Plan. Notwithstanding any provisions to the contrary, if any Eligible Employee is entitled to any severance benefits under any separately negotiated employment or severance agreements, or offer letters, no benefits shall be payable under the Severance Plan unless provided otherwise in any such separate agreement or letter. However, in the event that any separate Agreement or letter provides for any additional benefits, including benefits provided under the Severance Plan, in no event shall any Eligible Employee receive benefits which are determined to be duplicative, within the discretion of the Committee. In the event of any conflict in benefits, the Committee, within its discretion, shall provide an Eligible Employee with the greater of the benefits provided under the Severance Plan or any separately negotiated agreement or letter.

30. Form of Communication. Any election, claims, notice or other communication required or permitted to be made by or to an Eligible Employee under this Plan shall be made in writing and in such form as shall be prescribed by SMSC. Such communication shall be effective upon receipt by SMSC, if hand delivered or sent by first class mail, postage pre-paid, return receipt requested to the Vice President of Human Resources, Standard Microsystems Corporation, 80 Arkay Drive, Hauppauge, New York 11788.

31. Plan Number. The Plan Number assigned to this Plan for purposes of Internal Revenue Form 5500 filings is 501.

32. Severability. The invalidity of any portion of this Plan shall not invalidate the remainder, and the remainder of the Plan shall continue in full force and effect.

33. No Future Application for Employment. An Eligible Employee agrees not to apply for any new positions with SMSC or any Related Entities following any Termination Date if so provided in the Eligible Employee’s Severance Agreement, within the discretion of SMSC.

34. No Release of Future Claims. This Agreement does not waive or release any rights or claims that the Employee may have under the Age Discrimination in Employment Act which arises after the effective date of the Agreement, if applicable.

35. Reference. Reference inquiries from prospective employers shall be handled by only verifying the Employee’s dates of employment, last position held and level of compensation.

36. Captions. The captions at the head of a paragraph of this Plan are designed for convenience of reference only and are not to be resorted to for the purpose of interpreting any provision of this Plan.

37. Gender and Number. The masculine gender, where appearing herein, shall be deemed to include the feminine gender, and the singular shall be deemed to include the plural, unless the context clearly indicates to the contrary.

38. Governing Laws. The Plan shall be governed and construed in accordance with the laws of the State of New York, except to the extent preempted by ERISA.

STANDARD MICROSYSTEMS CORPORATION

/s/ Christine King
President and Chief Executive Officer

November 7, 2008

IMPORTANT INFORMATION.

• Plan Year: January 1 to December 31

• Type of Plan: Severance Plan

• Plan No.: 501

• Plan Sponsor: Standard Microsystems Corporation

EIN 11-2234952

• Plan Administrator: Standard Microsystems Corporation

• Funding: Employer self funded

• Agent for Service
of Legal Process:
Standard Microsystems Corporation
80 Arkay Drive
Hauppauge, New York 11788

Exhibit 10.3

November 5, 2008

Mr. Walter Siegel
19 Hickory Drive
Great Neck, NY 11023

Re: Letter Agreement

Dear Walter:

On September 30, 2005, you received an Offer Letter from Standard Microsystems Corporation (the “Company” or “SMSC”). As a result of Section 409A (“409A” or “Section 409A”) of the Internal Revenue Code (the “Code”), SMSC wishes to once again reconfirm the terms of your continued employment as Vice President and General Counsel as follows:

• Annual Base Salary: $294,000

• Annual Incentive Bonus Target: $104,958 (or approximately 36% of base salary). Generally, one-half of any bonus is paid in cash and one half is paid as a restricted stock award vesting 25% after each of the first two years after the date of the grant and the remaining 50% after the third year from the date of the grant. For the Company’s fiscal year 2007, your incentive bonus plan will be modified to provide for an additional over-plan bonus amount consistent with what is approved by the Compensation Committee, which is currently approximately 13% of base salary. Notwithstanding anything herein to the contrary, any annual bonus for a particular fiscal year shall be paid to you as soon as reasonably practicable following the end of such fiscal year and in any event no later than 2 1/2 months following the end of such fiscal year; provided that in the event payment of such bonus to you within such 2 1/2 month period is impracticable, either administratively or economically, as determined by the Company, payment of such bonus will be made as soon as practicable thereafter.

• Monthly Car Allowance: $700

• Your annual salary, annual incentive bonus target, and monthly car allowance may be reviewed and increased from time to time.

• Eligibility for Individual Executive Life Insurance ($250,000 death benefit), subject to obtaining underwriting.

• Eligibility Individual Executive Disability Income Insurance (up to 1/3^rd of salary), subject to obtaining underwriting.

• Eligibility to participate in the Company’s Supplemental Executive Retirement Plan, which, if fully vested, provides for a retirement benefit of 35% of base salary for 10 years.

• Eligibility for severance benefits as set forth below: If your employment is terminated for any reason other than “Cause”, of if your compensation or duties are reduced following a “Change in Control”, including without limitation no longer being the general counsel of any successor to the Company, or upon a “Required Relocation” (hereinafter referred to as “Good Reason Terminations”), then you shall receive severance in a single lump sum cash payment equal to 12 months base salary (each a “Severance Eligible Event”). In addition, the Company shall pay you in a lump sum cash payment an amount equal to the value, as if fully vested, of any granted stock option, RSA or stock appreciation rights upon any Change in Control or “Severance Eligible Event.” For purposes of this paragraph:

a) “Cause” shall mean only any material violation of the terms of any of SMSC’s personnel policies or procedures, provided you have been given notice of the violation and a reasonable opportunity to cure such violation; any material misstatement contained in your employment application; commission by you of any crime or fraud against SMSC or its property or any crime involving moral turpitude or reasonably likely to bring discredit upon SMSC; or gross negligence or willful misconduct in the performance of your duties;

b) A “Change in Control” of SMSC shall be deemed to have occurred upon the occurrence of one of the following events:

i. The merger or consolidation of SMSC with or into any other corporation or entities whereby the shareholders of SMSC immediately before the transaction do not own at least 50% of the new entity;

ii. SMSC is merged or consolidated with or into any other corporation or other entity, and at any time after such merger or consolidation is effected, the Continuing Directors are not or cease for any reason to constitute a majority of the board of directors either of the surviving entity, or of any entity in control of the surviving entity; or

iii. All or substantially all of the assets of SMSC are sold or otherwise transferred to any other corporation or other entity, or more than 50% of the stock of SMSC is purchased by one entity, and at any time after such sale or other transfer is effected, the Continuing Directors are not or cease for any reason to constitute, a majority of the board of directors either of the entity which has acquired and owns such assets, or of any entity in control of the entity which has acquired and owns such assets.

In determining if a Change in Control occurs, the term “Continuing Directors” means any person who either: (i) was elected a member of the Board at any Annual Meeting of Stockholders of SMSC prior to the occurrence of a corporate event that is alleged to be a Change in Control; or (ii) whose election to the Board or nomination for election to the Board by SMSC’s stockholders was approved in advance by at least two-thirds of the Continuing Directors then in office; and

c) A “Required Relocation” shall mean if you are required to relocate to a new position that is more than 75 miles from the location of your employment prior to such written required relocation.

d) You may terminate your employment hereunder for “Good Reason”, which shall be “treated” as an involuntary termination if the following “safe harbor” rules are satisfied:

(i) You must Separate from Service within a limited period of time, not to exceed 60 days following the reason for the Good Reason termination;

(ii) You must provide notice of the existence of the Good Reason condition within a period not to exceed 30 days of its initial existence.

(iii) The Company shall be provided a period of 30 days during which it may remedy the condition entitling you to terminate your employment for Good Reason.

e) For purposes of this Letter Agreement the value of any stock option or SAR shall be the spread between the grant price and the closing price of the common stock of the Company measured on the exchange on which the Company’s stock is traded on the date of the relevant event, or the next day on which the exchange is open if the exchange is closed on the date of the relevant event; the value of any common stock shall be the closing price of the common stock of the Company measured on the exchange on which it is traded on the date of the relevant event, or the next day on which the exchange is open if the exchange is closed on the date of the relevant event. Once the Company makes such payment all such SARS, stock options and stock grants shall be automatically deemed cancelled.

The foregoing severance benefits may not be reduced without your written consent, notwithstanding the terms and conditions of any Severance Plan, or the cancellation of modification of any Severance Plan. The payment of 12 months base salary as severance is in lieu of any base salary you would receive as part of any Severance Plan; however you shall receive any additional benefits not set forth herein, to which you are entitled as an Executive as part of any Severance Plan sponsored by the Company.

The parties acknowledge that the payment of some or all of the above benefits payable under the SMSC Severance Plan or this Letter Agreement may be considered to be a form of nonqualified deferred compensation benefits subject to 409A of the Code. In recognition of this fact, the parties hereby agree and confirm as follows:

i. Notwithstanding anything to the contrary in this Agreement, in no event shall any benefits be paid to you prior to the 6th month anniversary of the your Separation from Service as defined in 409A, unless otherwise permissible under 409A. Any and all payments that may not be paid prior to such 6^th month anniversary shall be delayed until the first day of the month after such 6^th anniversary occurs and shall retroactively apply to make you whole for any lost benefits, with interest at the rate of prime plus 2%, determined as of the first day of the month in which the Separation from Service occurred. To the extent that you are required to pay for the cost of any benefits to keep them in full force and effect during the 6 month delay period, you shall also be reimbursed for such out-of-pocket expenses as of the same date provided above with the same rate of interest.

ii. Notwithstanding any provision to the contrary, in accordance with the Final Regulations issued under Section 409A of the Code, to the extent that any benefits to a Specified Employee do not exceed the lesser of the Specified Employee salary for the past 2 years or the Section 401(a)(17) limitations, such amount may be paid within the 6 month period of time during which benefits may generally not be paid to Specified Employees. To the extent benefits exceed such limitations (which is a maximum of $460,000 in 2008 and $490,000 in 2009), the balance of any payments not otherwise payable during such period shall be made following the expiration of the 6 month period following a Separation of Service in a single lump sum payment on the first day of the month after the 6 month separation period with interest equal to prime rate as of the first day of the month in which a Separation from Service occurs, plus 2%.

iii. In the event that any payment or benefit required to be paid to you pursuant to this Agreement would violate 409A, the parties agree notwithstanding any provisions of this Agreement to the contrary, to amend this Agreement, to the extent necessary and reasonable to maintain the spirit of this Agreement without resulting in a violation under 409A.

iv. In the event of a violation of 409A, it is not the intent of the Company for you to incur the excise tax and other penalties under 409A. Accordingly, to the extent any excise taxes or underpayment of interest or penalties under 409A apply, the Company shall make a “gross up” payment to you, to offset the effect of any excise tax, interest or penalties incurred in accordance with 409A, and any tax on such gross up payments, to the extent such action is legally permitted.

In the case of a Change in Control of Company, you are entitled to a “gross-up” payment in an amount sufficient to offset the effect of any excise tax incurred in accordance with Section 280G of the Code, and any tax on the gross-up payment; provided, that in the event the aggregate amount of the payments and benefits, that are otherwise subject to the excise tax of Section 4999 of the Code, you are entitled to receive in connection with a Change in Control (the “Aggregate Payment”) is equal to less than Twenty Thousand Dollars ($20,000.00) more than the product of (i) three and (ii) your Base Amount (as such term is defined in Section 280G(b)(3) of the Code and the regulations issued under Section 280G of the Code), the Aggregate Payment will be reduced to the minimum amount as will result in no portion of the Aggregate Payment being subject to such excise tax; provided that the payments and/or benefits to be eliminated in effecting such reduction shall be agreed upon between the Company and you.

All gross up payments set forth in the Letter Agreement shall be made as soon as legally permitted under 409A, but in no event later than 2 1/2 months following the end of the fiscal year in which the event giving rise to such gross up payment occurs and, if permissible, before the excise tax becomes due.

In order to receive the foregoing severance benefits, you shall be required to execute a general release within 30 days of the date of your separation from service (the “Release Period”) in substantially the form currently set forth in Section 15 of the Severance Plan, however in addition to the exclusions from the release set forth in the Severance Plan, the Company will also exclude from the release any obligation of the Company to you under any indemnity agreement, and any obligation of the Company to indemnify you pursuant to contract, law, charter, by-law or otherwise.

• Vacation time to be accrued at the rate of 20 days per year.

• Paid holidays will be according to the Company’s holiday schedule for U.S. employees.

• You will be eligible to participate in all other benefits programs offered to similarly situated employees in New York.

Any payment that otherwise would be made to you prior to your delivery of such executed release shall be paid to you on the first business day following the conclusion of the Release Period.

Your eligibility to participate in the various compensation and benefits plans offered by the Company is subject to your compliance with the terms of each plan, which may be changed by the Company from time to time except as set forth above.

A basic philosophy of SMSC is that we depend upon our employees to succeed. We therefore want our relationship to be one of long-standing, which offers you the opportunity to effectively use your skills and successfully service our customers’ needs. We are confident that you will perform satisfactorily and follow our policies and procedures. Our objective has always been to provide employees with career opportunities; however, this will be influenced by your performance and SMSC’s success in the marketplace. Changes in the economy, our markets and technology will continue to occur; therefore, notwithstanding the fact that we are a career employee oriented Company, this offer of employment should not be construed as a contract or a commitment that your employment will continue for a specific period of time.

We look forward to having you remain with SMSC for what I am confident will be a mutually beneficial association. In the meantime, if you have any questions, please do not hesitate to contact me. This Letter Agreement may be executed by each party by facsimile counterpart.

This Letter Agreement supersedes and replaces your Offer Letter and is only supplemented by your Employee Agreement dated October 24, 2005. This Letter Agreement does not cancel any stock options, stock appreciation rights or restricted stock awards previously granted to you; nor does it cancel your Indemnity Agreement, which shall remain in full force and effect.

Sincerely,

/s/ Christine King
President and Chief Executive Officer

Encl.

Agreed and accepted.

SIGNATURE:	/s/ Walter Siegel
DATE:	November 6, 2008

Exhibit 10.4

November 5, 2008

Mr. Aaron L. Fisher
33 Nadworny Lane
Stonybrook, NY 11790

Re: Letter Agreement

Dear Aaron:

On August 30, 2006, you received an Offer Letter from Standard Microsystems Corporation (the “Company” or “SMSC”). As a result of Section 409A (“409A” or Section 409A”) of the Internal Revenue Code (the “Code”), SMSC wishes to confirm the terms of your continued employment as Senior Vice President of Products and Technology as follows:

• Annual Base Salary of not less than $315,000.

• Annual Incentive Bonus Target of 75% of base salary; initially $236,250. Your incentive bonus target for the Company’s fiscal year ending February 28, 2007 will be prorated based on the number of days you are employed by the Company during its fiscal year 2007. Generally, one-half of any bonus is paid in cash and one half is paid as a restricted stock award (“RSA”) vesting as follows: 25% per year for each of the first two years after the date of the grant, and the remaining 50% after the third year after the date of the grant. Your incentive bonus plan will be modified to provide for an additional annual over-plan bonus amount consistent with the current Management Incentive Plan currently in place and which is paid in cash after year-end. For a full year, this amount is currently 8% of base salary, or approximately $25,200, and which would be paid in cash. Your Annual Incentive Bonus Target will be reviewed upon your first employment anniversary date for a possible adjustment. Notwithstanding anything herein to the contrary, any annual bonus for a particular fiscal year shall be paid to you as soon as reasonably practicable following the end of such fiscal year and in any event no later than 2 1/2 months following the end of such fiscal year; provided that in the event payment of such bonus to you within such 2 1/2 month period is impracticable, either administratively or economically, as determined by the Company, payment of such bonus will be made as soon as practicable thereafter.

• Monthly Car Allowance: $1,000

• Your annual salary, annual incentive bonus target, and monthly car allowance may be reviewed and increased from time to time.

• A hire-on bonus of $150,000 was paid in cash less applicable withholdings upon closing on a home on Long Island, NY. If you voluntarily resign your employment within three years of receipt of this bonus, you will be required to repay to SMSC this hire-on bonus on a prorata basis on or before your last date of employment without regard to any income taxes you may have paid or be responsible to pay relating to this bonus. This bonus shall be fully earned by you three years after receipt.

• Eligibility for Company paid Individual Executive Life Insurance ($250,000 death benefit), subject to obtaining underwriting.

• Eligibility for Company paid Individual Executive Disability Income Insurance (up to 1/3^rd of salary), subject to obtaining underwriting.

• Eligibility to participate in the Company’s Supplemental Executive Retirement Plan, which, if fully vested, provides for a retirement benefit of 35% of base salary for 10 years.

• Eligibility for severance benefits as set forth below: If your employment is terminated for any reason other than “Cause”, or if your compensation or duties are reduced following a “Change of Control”, or upon a “Required Relocation” (hereinafter referred to as “Good Reason Terminations”), (each of which shall be deemed a “Severance Eligible Event”), then you shall receive severance in a single lump sum cash payment equal to 12 months base salary and the Company shall pay for the cost of continuing your health insurance benefits under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), to the extent you are eligible and elect such benefits, for a period of 12 months. In addition, any granted stock option, RSA or stock appreciation rights (“SARs”) that, but for such termination, would have become exercisable in accordance with its terms within 24 months of the date of such termination, shall become exercisable (or become unrestricted in the case of RSAs) upon any Change of Control or “Severance Eligible Event.” Such option or SAR shall remain exercisable for a period of 12 months following your employment termination date. With respect to the vesting of any stock option or SAR that occurs within 12 months from the date of grant, immediate vesting will only occur to the extent permitted under the provisions of the plan from which such stock option or SAR was granted. In addition, in the event your employment is terminated for any Severance Eligible Event upon a Change of Control, you will be paid a prorata portion of any earned incentive bonus for which you would have otherwise been eligible, based on the number of days employed by the Company during the Company’s then current fiscal year and restriction on all RSAs previously granted shall be removed. For purposes of this paragraph:

(a) “Cause” shall mean only a material violation of the terms of any of SMSC’s personnel policies or procedures, provided you have been given notice of the violation and a reasonable opportunity to cure such violation; a material misstatement contained in your employment application; commission by you of any crime or fraud against SMSC or its property or any crime involving moral turpitude or reasonably likely to bring discredit upon SMSC; or gross negligence or willful misconduct in the performance of your duties;

(b) A “Change in Control” of SMSC shall be deemed to have occurred upon the occurrence of one of the following events:

i. The merger or consolidation of SMSC with or into any other corporation or entities whereby the shareholders of SMSC immediately before the transaction do not own at least 50% of the new entity;

ii. SMSC is merged or consolidated with or into any other corporation or other entity, and at any time after such merger or consolidation is effected, the Continuing Directors do not or cease for any reason to constitute a majority of the board of directors either of the surviving entity, or of any entity in control of the surviving entity; or

iii. All or substantially all of the assets of SMSC are sold or otherwise transferred to any other corporation or other entity, or more than 50% of the stock of SMSC is purchased by one entity, and at any time after such sale or other transfer is effected, the Continuing Directors do not or cease for any reason to constitute, a majority of the board of directors either of the entity which has acquired and owns such assets, or of any entity in control of the entity which has acquired and owns such assets.

In determining if a Change in Control occurs, the term “Continuing Directors” means any person who either: (i) was elected a member of the Board at any Annual Meeting of Stockholders of SMSC prior to the occurrence of a corporate event that is alleged to be a Change in Control; or (ii) whose election to the Board or nomination for election to the Board by SMSC’s stockholders was approved in advance by at least two-thirds of the Continuing Directors then in office; and

(c) A “Required Relocation” shall mean if you are required to relocate to a new position that is outside of Long Island or, in the event you are willingly transferred to another SMSC location, that is more than 75 miles from the location of your employment.

(d) You may terminate your employment hereunder for “Good Reason”, which shall be “treated” as an involuntary termination if the following “safe harbor” rules are satisfied:

i. You must Separate from Service within a limited period of time, not to exceed 60 days following the reason for the Good Reason termination;

ii. You must provide notice of the existence of the Good Reason condition within a period not to exceed 30 days of its initial existence.

iii. The Company shall be provided a period of 30 days during which it may remedy the condition entitling you to terminate your employment for Good Reason.

The foregoing severance benefits may not be reduced without your written consent, notwithstanding the terms and conditions of any Severance Plan, or the cancellation of modification of any Severance Plan. The payment of 12 months base salary as severance is in lieu of any severance payment of base salary you would receive as part of any Severance Plan; however you shall receive any additional benefits not set forth herein to which you are entitled as an Executive as part of any Severance Plan, sponsored by the Company.

The parties acknowledge that the payment of some or all of the above severance benefits payable under the SMSC Severance Plan or this Letter Agreement may be considered to be a form of nonqualified deferred compensation benefits subject to 409A. In recognition of this fact, the parties hereby agree and confirm as follows:

i. Notwithstanding anything to the contrary in this Agreement, in no event shall any benefits be paid to you prior to the 6th month anniversary of your Separation from Service as defined pursuant to 409A, unless otherwise permissible under 409A. Any and all payments that may not be paid prior to such 6^th month anniversary shall be delayed until the first day of the month after such 6^th anniversary occurs and shall retroactively apply to make you whole for any lost benefits, with interest at the rate of prime plus 2%, determined as of the first day of the month in which the Separation from Service occurred. To the extent that you are required to pay for the cost of any benefits to keep them in full force and effect during the 6 month delay period, you shall also be reimbursed for such out-of-pocket expenses as of the same date provided above with the same rate of interest.

ii. Notwithstanding any provision to the contrary, in accordance with the Final Regulations issued under Section 409A of the Code, to the extent that any benefits to a Specified Employee do not exceed the lesser of the Specified Employee salary for the past 2 years or the Section 401(a)(17) limitations, such amount may be paid within the 6 month period of time during which benefits may generally not be paid to Specified Employees. To the extent benefits exceed such limitations (which is a maximum of $460,000 in 2008 and $490,000 in 2009), the balance of any payments not otherwise payable during such period shall be made following the expiration of the 6 month period following a Separation of Service in a single lump sum payment on the first day of the month after the 6 month separation period with interest equal to prime rate as of the first day of the month in which a Separation from Service occurs, plus 2%.

iii. In the event that any payment or benefit required to be paid to you pursuant to this Agreement would violate 409A, the parties agree notwithstanding any provisions of this Agreement to the contrary, to amend this Agreement, to the extent necessary and reasonable to maintain the spirit of this Agreement without resulting in a violation under Section 409A.

iv. In the event of a violation of 409A , it is not the intent of the Company for you to incur the excise tax and other penalties under 409A. Accordingly, to the extent any excise taxes, or underpayment of interest or penalties under 409A apply, the Company shall make a “gross up” payment to the employee, to offset the effect of any excise tax, interest or penalties incurred in accordance with 409A , and any tax on such gross up payments to the extent such action is legally permitted.

In the case of a Change in Control of Company, you are entitled to a “gross-up” payment in an amount sufficient to offset the effect of any excise tax incurred in accordance with Section 280G of the Code, and any tax on the gross-up payment; provided, that in the event the aggregate amount of the payments and benefits, that are otherwise subject to the excise tax of Section 4999 of the Code, you are entitled to receive in connection with a Change in Control (the “Aggregate Payment”) is equal to less than Twenty Thousand Dollars ($20,000.00) more than the product of (i) three and (ii) your Base Amount (as such term is defined in Section 280G(b)(3) of the Code and the regulations issued under Section 280G of the Code), the Aggregate Payment will be reduced to the minimum amount as will result in no portion of the Aggregate Payment being subject to such excise tax; provided that the payments and/or benefits to be eliminated in effecting such reduction shall be agreed upon between the Company and you.

All gross up payments set forth in the Letter Agreement shall be made as soon as legally permitted under Section 409A of the Code, but in no event later than 21/2 months following the end of the fiscal year in which the event giving rise to such gross up payment occurs and, if permissible, before the excise tax becomes due.

• In order to receive the foregoing severance benefits, you shall be required to execute a general release within 30 days of the date of your separation from service (the “Release Period”), in substantially the form currently set forth in Section 15 of the Severance Plan.

• The Company reimbursed you for reasonable relocation costs in connection with moving your residence from Allentown, Pennsylvania to Long Island, New York. In the event you voluntarily leave the Company’s employ on or before one year following the date you close on the purchase of a residence on Long Island (the “Close”), you will be required to immediately pay to the Company the total of the relocation costs paid to you or on your behalf, including tax protection payments, which were reportable income to you. In the event you voluntarily resign from the Company after one completed year of service from the Close but before the second anniversary of the Close, you will be required to immediately pay to the Company three quarters of the total of the relocation costs paid to you or on your behalf, including tax protection payments, which were reportable income to you. In the event you voluntarily resign from the Company after two completed years of service from the Close but before the third anniversary of the Close, you will be required to immediately pay to the Company one half of the total of the relocation costs paid to you or on your behalf, including tax protection payments, which were reportable income to you. In the event you voluntarily resign from the Company after three completed years of service from the Close but before the fourth anniversary of the Close, you will be required to immediately pay to the Company one quarter of the total of the relocation costs paid to you or on your behalf, including tax protection payments, which were reportable income to you.

• Vacation time to be accrued at the rate of 20 days per year.

• Paid holidays will be according to the Company’s holiday schedule for U.S. employees.

• You will be eligible to participate in all other benefits programs offered to similarly situated employees in New York such as the Company’s 401k plan.

• This offer is subject to the approval of the Compensation Committee of the Company or a majority of the independent directors of the Company.

Any payment that otherwise would be made to you prior to your delivery of such executed release shall be paid to you on the first business day following the conclusion of the Release Period.

In consideration of your employment with the Company and the compensation and benefits provided by the Company, you agree that for so long as you shall be employed by Company or any Company Affiliate, and for one year thereafter, you shall not, directly or indirectly, as principal, partner, agent, servant, employee, stockholder, or otherwise, anywhere in the world (the “Territory”), engage or attempt to engage in any business activity competitive with the business being conducted by Company or which Company or any Company affiliate plans to conduct, according to your knowledge at the time notice or actual termination occurs, whichever is earlier, . You recognize that the foregoing territorial and time limitations are reasonable and properly required for the adequate protection of the business of Company and that in the event that any such territorial or time limitation is deemed to be unreasonable in any proceeding to enforce these provisions or otherwise, you agree to request, and to submit to, the reduction of said territorial or time limitation to such an area or period as shall be deemed reasonable by the relevant tribunal. Further, you agree that for a period of 24 months after your termination of employment with Company for any reason, you shall not, directly or indirectly, whether on behalf of yourself or others, solicit, lure or hire away any employees of Company or assist or aid in any such activity. You acknowledge that the scope of the covenant not to compete and the nonsolicitation of employees and client provisions contained in this Agreement are reasonable. In the event that any aspect of these provisions is deemed to be unreasonable by a court, you will submit to any reductions as the court shall deem reasonable.

Your eligibility to participate in the various compensation and benefits plans offered by the Company is subject to your compliance with the terms of each plan, which may be amended or modified by the Company, in its sole discretion, from time to time except as set forth above.

A basic philosophy of SMSC is that we depend upon our employees to succeed. We therefore want our relationship to be one of long-standing, which offers you the opportunity to effectively use your skills and successfully service our customers’ needs. We are confident that you will perform satisfactorily and follow our policies and procedures. Our objective has always been to provide employees with career opportunities; however, this will be influenced by your performance and SMSC’s success in the marketplace. Changes in the economy, our markets and technology will continue to occur; therefore, notwithstanding the fact that we are a career employee oriented Company, this offer of employment should not be construed as a contract or a commitment that your employment will continue for a specific period of time.

We look forward to having you remain with SMSC for what I am confident will be a mutually beneficial association. In the meantime, if you have any questions, please do not hesitate to contact me. This Letter Agreement may be executed by each party by facsimile counterpart.

This Letter Agreement supersedes and replaces your Offer Letter and is only supplemented by your Employee Agreement dated September 6, 2006. This Letter Agreement does not cancel any stock options, stock appreciation rights or restricted stock awards previously granted to you.

Sincerely,

/s/ Christine King
President and Chief Executive Officer

Encl.

Agreed and accepted.

SIGNATURE:	/s/ Aaron Fisher
DATE:	November 6, 2008