MIPS Technologies, Inc. Performance-Based Bonus Plan for Executives Effective July 1, 2011 (adopted by the Board of Directors on September 9, 2011)

Eligibility. The CEO and other executives or employees as recommended by the CEO and approved by the Compensation and Nominating Committee of the Board of Directors shall be eligible to participate in the Plan.  An eligible employee must be an employee in good standing at MIPS Technologies, Inc. or one of its subsidiaries at the completion of each Plan period and at the time of payout.  The Board of Directors shall retain in its sole discretion the authority to approve payments to the CEO.  Upon the recommendation of the CEO, the Compensation and Nominating Committee shall in its sole discretion approve payments to other participating executives or employees.

A specific percentage of base salary shall be established for each selected participant as the target for “on Plan” compensation.  For the CEO, the target shall be 90%.  For the senior executive staff, the target shall be: (i) 40% for the Vice President of Corporate Development and the Vice President of Sales, (ii) 50% for the Chief Financial Officer, the General Counsel, and the Vice President of Marketing, and (iii) 60% for the Vice President of Engineering.   Other selected participants may have other targets as determined by the CEO.  A participant’s base salary multiplied by the target percentage shall be referred to as the “Target Bonus Amount.”

The Corporate Component of the Multiplier shall be a maximum of two if the actual pro forma operating margin exceeds the financial plan by 30% or more, provided the actual corporate revenue is equal to or exceeds the approved financial plan revenue number.  Notwithstanding the foregoing, the Board may determine, in its discretion, in the event that the Corporate Component of the Multiplier is greater than one, that such Corporate Component will be one.

The Corporate Component of the Multiplier is determined by adding the following three sub-components together:  (a) A number between zero (0) and one half (0.5) determined by taking actual revenue for the plan period and calculating on a linear proportional basis from 80% to 100% of the financial plan number; (b) a number between zero (0) and one half (0.5) determined by taking actual pro forma operating margin for the plan period and calculating on a linear proportional basis from 80% to 100% of the financial plan number; and (c) a number between zero (0) and one (1.0) determined by taking actual pro forma operating margin for the plan period and calculating  on a linear proportional basis from 100% to 130% of the financial plan number.

For purposes of this bonus Plan, the actual pro forma operating margin shall be derived on the same basis as the financial plan which generally shall be by taking GAAP operating margin less non cash costs (such as for 123R stock based compensation and certain other amortized costs) and other exceptional charges (such as for acquisitions or restructurings).

For the avoidance of doubt, a participant in this Plan shall be eligible for a bonus (in accordance with the terms of this Plan) if one component of the Multiplier is zero as long as the other component of the Multiplier is greater than zero.

The Board of Directors and the Compensation and Nominating Committee, as applicable, shall have discretion to vary the amount of the Multiplier in light of the CEO’s and other executive’s or employee’s performance to goals, notwithstanding the above calculation.

Determination Date and Payments.  No bonus shall be considered earned under this Plan unless and until the Board and the Compensation and Nominating Committee (as applicable) have determined that bonuses will be paid under the Plan, and have approved the amount of bonus which shall be paid to each participant (such date, the “Determination Date”).  No pro rata bonus may be earned prior to the Determination Date.  Payments will be paid in cash after the Determination Date, typically within two months after the completion of each Plan period, unless the participant has exercised a right under a company established plan to defer such payment, in which case, when applicable, payment in accordance with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, will be made in accordance with such deferral plan and applicable law.   In order to be eligible to earn a bonus, a participant must be employed on the Determination Date unless otherwise determined by the Compensation and Nominating Committee in its sole discretion.