Marvell Technology Group (MRVL)

Our tentative settlement of the consolidated shareholder derivative action requires the court's preliminary and final approval, and may not be approved by the court.

        On or about March 5, 2008, the parties entered into a memorandum of understanding that tentatively settles and resolves the pending consolidated derivative action. This tentative settlement of the derivative action requires court approval before it becomes final. The court may not preliminarily or finally approve the tentative settlement. If the court does not approve the tentative settlement, the parties might elect or be required to continue litigating the consolidated derivative action.

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Matters related to the internal review of our historical stock option granting practices and the restatement of our financial statements may result in additional litigation, regulatory proceedings and government enforcement actions, and could have a negative impact on our reputation, business, financial condition and financial results.

        Our historical stock option granting practices and the restatement of our financial statements have exposed us to greater risks associated with litigation, regulatory proceedings and government enforcement actions. For more information regarding our current litigation and related inquiries, please see the discussion included in Part II, Item 1 — "Legal Proceedings," of this Report as well as the other risk factors related to litigation set forth in this section. We have provided the results of our internal review to the Securities and Exchange Commission ("SEC") and the United States Attorney's Office for the Northern District of California, and in that regard we have responded to formal and informal requests for documents and additional information. On October 11, 2007, we received a "Wells Notice" from the staff of the SEC. Weili Dai, Director of Strategic Marketing and Business Development and our former Chief Operating Officer, who is no longer an officer or director of Marvell, also received a notice. The notices indicate that the staff intends to recommend to the Commission that it bring civil actions against recipients for injunctive relief and civil monetary penalties. We have responded in writing to the "Wells Notice." As previously disclosed, the Company is seeking to reach a resolution of this matter before any action is filed. We cannot be certain regarding the outcomes of litigation, regulatory proceedings or government enforcement actions relating to our past stock option practices. The resolution of these matters has been and will be time consuming and expensive, and may require the time and attention of our management. Further, we could be required to pay damages or penalties or have other remedies imposed against us, our directors, executive officers or other officers, or employees, which could harm our reputation, business, financial condition, results of operations and cash flows.

        The restatement of our financial statements, the findings and recommendations of our Board's Special Committee Regarding Deriviative Litigation, the ongoing government investigations, and the pending derivative and class actions could have a negative impact on our relationships with customers, suppliers and business partners, our ability to generate revenue, our ability to obtain director and officer insurance coverage, our ability to attract and retain employees, officers, and directors, our ability to access debt and equity markets, customer and investor confidence in the board and management, and our revenue, net income, expenses, results of operations, profitability, earnings-per-share, and cash flows.

        In addition, while we believe that we have, in completing the restatement of our financial statements, made appropriate judgments in determining the correct measurement dates and disclosures relating to our stock option investigation, the SEC may disagree with the manner in which we reported the results of the investigation or accounted for and reported, or did not report, the corresponding financial impact. Accordingly, it is possible that we will be required to restate further our prior financial statements, amend prior filings with the SEC, or take other actions not currently contemplated.

Our tentative settlement of the consolidated shareholder derivative action requires the court's preliminary and final approval, and may not be approved
by the court.

        On or about March 5, 2008, the parties entered into a memorandum of understanding that tentatively settles and resolves the pending consolidated derivative
action. This tentative settlement of the
derivative action requires court approval before it becomes final. The court may not preliminarily or finally approve the tentative settlement. If the court does not approve the tentative settlement,
the parties might elect or be required to continue litigating the consolidated derivative action.

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Matters related to the internal review of our historical stock option granting practices and the restatement of our financial statements may result in
additional litigation, regulatory proceedings and government enforcement actions, and could have a negative impact on our reputation, business, financial condition and financial results.

        Our historical stock option granting practices and the restatement of our financial statements have exposed us to greater risks associated with litigation,
regulatory proceedings and government enforcement actions. For more information regarding our current litigation and related inquiries, please see the discussion included in Part II,
Item 1 — "Legal Proceedings," of this Report as well as the other risk factors related to litigation set forth in this section. We have provided the results of our internal
review to the Securities and Exchange Commission ("SEC") and the United States Attorney's Office for the Northern District of California, and in that regard we have responded to formal and informal
requests for documents and additional information. On October 11, 2007, we received a "Wells Notice" from the staff of the SEC. Weili Dai, Director of Strategic Marketing and Business
Development and our former Chief Operating Officer, who is no longer an officer or director of Marvell, also received a notice. The notices indicate that the staff intends to recommend to the
Commission that it bring civil actions against recipients for injunctive relief and civil monetary penalties. We have responded in writing to the "Wells Notice." As previously disclosed, the Company
is seeking to reach a resolution of this matter before any action is filed. We cannot be certain regarding the outcomes of litigation, regulatory proceedings or government enforcement actions relating
to our past stock option practices. The resolution of these matters has been and will be time consuming and expensive, and may require the time and attention of our management. Further, we could be
required to pay damages or penalties or have other remedies imposed against us, our directors, executive officers or other officers, or employees, which could harm our reputation, business, financial
condition, results of operations and cash flows.

        The
restatement of our financial statements, the findings and recommendations of our Board's Special Committee Regarding Deriviative Litigation, the ongoing government investigations,
and the pending derivative and class actions could have a negative impact on our relationships with customers, suppliers and business partners, our ability to generate revenue, our ability to obtain
director and officer insurance coverage, our ability to attract and retain employees, officers, and directors, our ability to access debt and equity markets, customer and investor confidence in the
board and management, and our revenue, net income, expenses, results of operations, profitability, earnings-per-share, and cash flows.

        In
addition, while we believe that we have, in completing the restatement of our financial statements, made appropriate judgments in determining the correct measurement dates and
disclosures relating to
our stock option investigation, the SEC may disagree with the manner in which we reported the results of the investigation or accounted for and reported, or did not report, the corresponding financial
impact. Accordingly, it is possible that we will be required to restate further our prior financial statements, amend prior filings with the SEC, or take other actions not currently contemplated.