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<SEC-DOCUMENT>0000950135-02-003172.txt : 20020628
<SEC-HEADER>0000950135-02-003172.hdr.sgml : 20020628
<ACCEPTANCE-DATETIME>20020628171640
ACCESSION NUMBER:		0000950135-02-003172
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		10
CONFORMED PERIOD OF REPORT:	20020625
ITEM INFORMATION:		Acquisition or disposition of assets
ITEM INFORMATION:		Changes in registrant's certifying accountant
ITEM INFORMATION:		Other events
ITEM INFORMATION:		Financial statements and exhibits
ITEM INFORMATION:		Change in fiscal year
FILED AS OF DATE:		20020628

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			SKYWORKS SOLUTIONS INC
		CENTRAL INDEX KEY:			0000004127
		STANDARD INDUSTRIAL CLASSIFICATION:	SEMICONDUCTORS & RELATED DEVICES [3674]
		IRS NUMBER:				042302115
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0930

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-05560
		FILM NUMBER:		02692174

	BUSINESS ADDRESS:	
		STREET 1:		20 SYLVAN ROAD
		CITY:			WOBURN
		STATE:			MA
		ZIP:			01801
		BUSINESS PHONE:		6179355150

	MAIL ADDRESS:	
		STREET 1:		20 SYLVAN ROAD
		STREET 2:		20 SYLVAN ROAD
		CITY:			WOBURN
		STATE:			MA
		ZIP:			01801

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	ALPHA INDUSTRIES INC
		DATE OF NAME CHANGE:	19920703
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>b43517sse8vk.txt
<DESCRIPTION>SKYWORKS SOLUTIONS, INC.
<TEXT>
<PAGE>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

                                    FORM 8-K

                                 CURRENT REPORT

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


                                  June 25, 2002
             ------------------------------------------------------
                Date of report (Date of earliest event reported)


                            Skyworks Solutions, Inc.
           ----------------------------------------------------------
               (Exact Name of Registrant as Specified in Charter)


          Delaware                         1-5560                04-2302115
- -------------------------------   ------------------------   -------------------
(State or Other Jurisdiction of   (Commission File Number)      (IRS Employer
        Incorporation)                                       Identification No.)


       20 Sylvan Road, Woburn, Massachusetts                         01801
- --------------------------------------------------------------------------------
      (Address of principal executive offices)                     (zip code)


                                 (781) 935-5150
 -------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

                             Alpha Industries, Inc.
 -------------------------------------------------------------------------------
          (Former Name or Former Address, if Changed Since Last Report)


<PAGE>


ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.

     Effective June 25, 2002, pursuant to the Agreement and Plan of
Reorganization, dated as of December 16, 2001, as amended as of April 12, 2002,
(the "Merger Agreement"), by and among Conexant Systems, Inc. ("Conexant"),
Washington Sub, Inc., a wholly owned subsidiary of Conexant ("Washington"), and
Alpha Industries, Inc. (the "Company"), Washington merged with and into the
Company, with the Company surviving the merger. Following the merger, the
Company changed its corporate name to Skyworks Solutions, Inc. In connection
with and immediately prior to the merger, Conexant spun-off its wireless
communications business by contributing the assets, liabilities (including
liabilities relating to former operations) and operations of its wireless
communications business, other than certain assets and liabilities retained by
Conexant, to Washington and then distributing outstanding shares of Washington
common stock to Conexant stockholders on a one share-for-one share basis (the
"Distribution") pursuant to the terms of the Contribution and Distribution
Agreement, dated as of December 16, 2001, as amended as of June 25, 2002, (the
"Amended Distribution Agreement"), by and between Conexant and Washington.

     Conexant stockholders received 0.351 of a share of common stock of the
Company in exchange for each share of Washington common stock issued to them in
the Distribution, and the shares of Washington stock were canceled and have
ceased to exist. Immediately following the merger, approximately 67% of the
common stock of the Company, on a fully diluted basis, was owned by Conexant
stockholders.

     Immediately following completion of the merger, the Company purchased from
Conexant, for an aggregate purchase price of $150 million, (i) all of the stock
of Conexant Systems, S.A. de C.V., Conexant's Mexican subsidiary that owns and
operates Conexant's semiconductor assembly and test facility located in
Mexicali, Mexico, pursuant to the Mexican Stock Purchase Agreement, dated as of
June 25, 2002, by and between Conexant and the Company (the "Mexican Stock
Purchase Agreement"), (ii) certain assets related to the Mexicali facility,
pursuant to the Amended and Restated Mexican Asset Purchase Agreement, dated as
of June 25, 2002 (the "Amended Mexicali Agreement"), between Conexant and the
Company and (iii) certain assets utilized by Conexant's package design team that
supports the Mexicali facility, pursuant to the U.S. Asset Purchase Agreement,
dated as of December 16, 2001, as amended as of June 25, 2002 (the "Amended U.S.
Asset Purchase Agreement"), between Conexant and the Company. The purchase price
was paid with short-term promissory notes delivered by the Company to Conexant,
which are secured by assets of the Company and certain of its subsidiaries
pursuant to a Financing Agreement, dated as of June 25, 2002, by and among
Conexant, the Company and certain of the Company's subsidiaries identified
therein (the "Financing Agreement"). The Financing Agreement is described in
Item 5 of this Form 8-K.

     In connection with the merger, the composition of the board of directors of
the Company (the "Board") was changed. The Board currently consists of eight
directors,


<PAGE>


four of whom were selected by Conexant and who currently also serve as officers
or directors of Conexant.

     The foregoing description of the merger, the Merger Agreement, the Amended
Distribution Agreement, the Mexican Stock Purchase Agreement, the Amended
Mexicali Agreement and the Amended U.S. Asset Purchase Agreement is qualified in
its entirety by reference to such agreements and the joint press release of the
Company and Conexant issued on June 26, 2002, copies of which are filed herewith
as Exhibits 2.1, 2.2, 2.3, 2.4, 2.5 and 99.4, respectively, and each of such
exhibits is hereby incorporated herein by reference.

ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.

     The Company's independent accountant is KPMG LLP ("KPMG") and Washington's
independent accountant was Deloitte & Touche LLP ("Deloitte & Touche"). KPMG has
continued to serve as the Company's independent accountant after consummation of
the merger. Because the merger is being accounted for as a reverse acquisition,
the financial statements of Washington constitute the financial statements of
the Company as of the consummation of the merger. Therefore, upon the
consummation of the merger on June 25, 2002, there was a change in the
independent accountant for the Company's financial statements from Deloitte &
Touche to KPMG, and accordingly, Deloitte & Touche was dismissed as the
Company's independent accountant.

     The reports of Deloitte & Touche on Washington's financial statements for
the fiscal years ended September 30, 2000 and 2001 did not contain an adverse
opinion or a disclaimer of opinion, nor were such reports qualified or modified
as to uncertainty, audit scope or accounting principles. The decision to change
accountants was approved by the Board.

     During Washington's fiscal years ended September 30, 2000 and September 30,
2001 and through the subsequent interim period to June 25, 2002, Washington did
not have any disagreement with Deloitte & Touche on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure that, if not resolved to Deloitte & Touche's satisfaction, would have
caused Deloitte & Touche to make reference to the subject matter of the
disagreement in connection with its report. During that time, there were no
"reportable events" as set forth in Item 304(a)(1)(v)(A)-(D) of Regulation S-K
("Regulation S-K") adopted by the Securities and Exchange Commission (the
"Commission").

     KPMG (or its predecessors) has been the Company's independent accountant
since 1975 and the Company has regularly consulted KPMG (or its predecessors)
since that time. Washington, as the continuing reporting entity for accounting
purposes, has not consulted KPMG during Washington's last two fiscal years and
through the interim period to June 25, 2002 regarding any of the matters
specified in Item 304(a)(2) of Regulation S-K. The Company has provided Deloitte
& Touche with a copy of this Form 8-K prior to its filing with the Commission.
Deloitte & Touche has provided a letter to


<PAGE>


the Company, dated June 27, 2002 and addressed to the Commission, which is
attached hereto as Exhibit 16.1 and is hereby incorporated herein by reference.

ITEM 5. OTHER EVENTS.

     As noted above under Item 2, in payment for the acquisition from Conexant
of its semiconductor assembly and test facility located in Mexicali, Mexico and
assets related thereto, the Company and its new subsidiary, Conexant Systems,
S.A. de C.V., issued short-term promissory notes (the "Acquisition Notes") to
Conexant in the aggregate principal amount of $150 million under the Financing
Agreement. In addition, under the Financing Agreement, Conexant committed to
make a short-term $100 million revolving loan facility available to the Company
to fund the Company's working capital and other requirements, $75 million of
which will be available on or after July 10, 2002, and the remaining $25 million
balance of which will be available if the Company has more than $150 million of
eligible domestic accounts receivable.

     The Acquisition Notes and the loans under the revolving loan facility
("Revolving Loans") are jointly and severally guaranteed by all of the Company's
domestic subsidiaries and certain of its foreign subsidiaries, and are secured
by a first priority lien on current and future tangible and intangible assets
and real property of the Company and such subsidiaries. Unless paid earlier at
the option of the Company or pursuant to the mandatory prepayment provisions of
the Financing Agreement, fifty percent of the principal amount of the
Acquisition Notes is due on March 21, 2003, and the remaining fifty percent of
the principal amount of the Acquisition Notes and the entire principal amount of
the Revolving Loans are due June 24, 2003.

     Interest on the Acquisition Notes and the Revolving Loans is payable at a
rate of 10% per annum for the first ninety days following June 25, 2002, 12% per
annum for the next ninety days and 15% per annum thereafter.

     The Company may prepay amounts outstanding under the Acquisition Notes and
the Revolving Loans at any time without penalty. The Company is required to
prepay amounts outstanding under the Financing Agreement in certain
circumstances. Commencing in July 2002, if at the end of any month the aggregate
amount of cash, cash equivalents and marketable securities of the Company on a
consolidated basis (the "Available Cash") exceeds $60 million, the Company is
required to use its Available Cash in excess of $60 million to repay amounts
outstanding under the Financing Agreement. In addition, if at any time, the net
cash proceeds from a sale of assets, an equity offering or an incurrence of
indebtedness causes the Company's Available Cash to exceed $60 million, the
Company is required to use its Available Cash in excess of $60 million to repay
amounts outstanding under the Financing Agreement. These mandatory prepayments
will be applied first to reduce the principal amount of the Acquisition Notes
due March 21, 2003, second to reduce the balance of the Acquisition Notes and
third to reduce the Revolving Loans.


<PAGE>


     The Financing Agreement contains representations and warranties of and an
indemnity by the Company and its guarantor subsidiaries in favor of Conexant. In
addition, the Financing Agreement contains certain covenants, including without
limitation, covenants (i) requiring the Company to maintain a minimum balance of
cash, cash equivalents and marketable securities, (ii) imposing limitations on
the incurrence of additional indebtedness, (iii) restricting sales of assets,
investments, acquisitions and capital expenditures, (iv) requiring the Company
to establish a finance committee and (v) restricting inter-company transfers of
working capital and assets to foreign subsidiaries.

     The Financing Agreement also contains events of default. Upon the
occurrence of an event of default (as defined in the Financing Agreement),
Conexant may choose from a number of remedies, including terminating the
revolving facility, declaring all amounts outstanding under the Acquisition
Notes and the Revolving Loans due and payable and selling the Company's
property.

     The foregoing description of the provisions of the Financing Agreement is
qualified in its entirety by reference to such agreement, a copy of which is
filed herewith as Exhibit 99.1, and such exhibit is hereby incorporated herein
by reference.

ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.

     (a)  Financial Statements of Business Acquired.
          Financial statements required by this item are not included in this
          initial report on Form 8-K, but will be filed by amendment within 60
          days after the date that this initial report on Form 8-K must be
          filed.

     (b)  Pro Forma Financial Information.
          Pro forma financial information required by this item are not included
          in this initial report on Form 8-K, but will be filed by amendment
          within 60 days after the date that this initial report on Form 8-K
          must be filed.

     (c)  Exhibits.

<TABLE>
<CAPTION>
     Exhibit No.
     -----------

<S>                 <C>
         2.1        Agreement and Plan of Reorganization, dated as of December 16, 2001,
                    as amended as of April 12, 2002, by and among Alpha Industries, Inc.,
                    Washington Sub, Inc. and Conexant Systems, Inc. (included as Annex A
                    to the Registration Statement on Form S-4 filed by Alpha Industries, Inc.
                    with the Securities and Exchange Commission on May 10, 2002 (File No. 333-83768),
                    and incorporated herein by reference).
         2.2        Contribution and Distribution Agreement, dated as of December 16,
                    2001, as amended as of June 25, 2002, by and between Conexant
                    Systems, Inc. and Washington Sub, Inc. (excluding schedules).
</TABLE>


<PAGE>


<TABLE>
<S>                 <C>
         2.3        Mexican Stock Purchase Agreement, dated as of June 25, 2002, by and
                    between Conexant Systems, Inc. and Alpha Industries, Inc. (excluding
                    exhibits and schedules).
         2.4        Amended and Restated Mexican Asset Purchase Agreement, dated as of
                    June 25, 2002, by and between Conexant Systems, Inc. and Alpha
                    Industries, Inc. (excluding exhibits and schedules).
         2.5        U.S. Asset Purchase Agreement, dated as of December 16, 2001, as
                    amended as of June 25, 2002, by and between Conexant Systems, Inc.
                    and Alpha Industries, Inc. (excluding exhibits and schedules).
         16.1       Letter dated June 27, 2002 from Deloitte & Touche LLP to the
                    Securities and Exchange Commission.
         99.1       Financing Agreement, dated as of June 25, 2002, by and among
                    Conexant Systems, Inc., Alpha Industries, Inc. and certain of its
                    subsidiaries identified therein (excluding certain exhibits and schedules).
         99.2       Tax Allocation Agreement, dated as of June 25, 2002, by and among
                    Conexant Systems, Inc., Washington Sub, Inc. and Alpha Industries, Inc.
                    (excluding schedules).
         99.3       Employee Matters Agreement, dated as of June 25, 2002, by and among
                    Conexant Systems, Inc., Washington Sub, Inc. and Alpha Industries, Inc.
                    (excluding schedules).
         99.4       Press Release by Conexant Systems, Inc. and Alpha Industries, Inc.
                    dated June 26, 2002.
</TABLE>

ITEM 8. CHANGE IN FISCAL YEAR.

     On April 25, 2002, in connection with its approval of the Company's Second
Amended and Restated By-Laws, the Board determined that, as of the effective
time of the merger, the Company's fiscal year will end on the Sunday closest to
September 30 of each year. No transition period will result from this change in
the current fiscal year.

            [The remainder of this page is intentionally left blank.]


<PAGE>


                                   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.


                                          SKYWORKS SOLUTIONS, INC.

Date: June 28, 2002                       By: /s/ Daniel N. Yannuzzi
      --------------------                    ----------------------------------
                                              Daniel N. Yannuzzi
                                              Vice President and General Counsel


<PAGE>


                                  EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No.
- -----------

<S>       <C>
2.1       Agreement and Plan of Reorganization, dated as of December 16, 2001, as
          amended as of April 12, 2002, by and among Alpha Industries, Inc.,
          Washington Sub, Inc. and Conexant Systems, Inc. (included as Annex A to
          the Registration Statement on Form S-4 filed by Alpha Industries, Inc. with
          the Securities and Exchange Commission on May 10, 2001, and incorporated herein
          by reference).

2.2       Contribution and Distribution Agreement, dated as of December 16, 2001, as
          amended as of June 25, 2002, by and between Conexant Systems, Inc. and
          Washington Sub, Inc. (excluding schedules).
2.3       Mexican Stock Purchase Agreement, dated as of June 25, 2002, by and
          between Conexant Systems, Inc. and Alpha Industries, Inc. (excluding
          exhibits and schedules).
2.4       Amended and Restated Mexican Asset Purchase Agreement, dated as of June
          25, 2002, by and between Conexant Systems, Inc. and Alpha Industries, Inc.
          (excluding exhibits and schedules).
2.5       U.S. Asset Purchase Agreement, dated as of December 16, 2001, as amended
          as of June 25, 2002, by and between Conexant Systems, Inc. and Alpha
          Industries, Inc. (excluding exhibits and schedules).
16.1      Letter dated June 27, 2002 from Deloitte & Touche LLP to the Securities and
          Exchange Commission.
99.1      Financing Agreement, dated as of June 25, 2002, by and among Conexant
          Systems, Inc., Alpha Industries, Inc. and certain of its subsidiaries identified
          therein (excluding certain exhibits and schedules).
99.2      Tax Allocation Agreement, dated as of June 25, 2002, by and among
          Conexant Systems, Inc., Washington Sub, Inc. and Alpha Industries, Inc.
          (excluding schedules).
99.3      Employee Matters Agreement, dated as of June 25, 2002, by and among
          Conexant Systems, Inc., Washington Sub, Inc. and Alpha Industries, Inc.
          (excluding schedules).
99.4      Press Release by Conexant Systems, Inc. and Alpha Industries, Inc. dated
          June 26, 2002.
</TABLE>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-2.2
<SEQUENCE>3
<FILENAME>b43517ssexv2w2.txt
<DESCRIPTION>CONTRIBUTION AND DISTRIBUTION AGREEMENT
<TEXT>
<PAGE>

                                                                     EXHIBIT 2.2


================================================================================


                     CONTRIBUTION AND DISTRIBUTION AGREEMENT

                                 by and between

                             CONEXANT SYSTEMS, INC.

                                       and

                              WASHINGTON SUB, INC.


================================================================================



                               December 16, 2001,

                                as amended as of

                                  June 25, 2002
<PAGE>
                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                             Page
                                                                             ----
<S>                                                                          <C>
ARTICLE I  DEFINITIONS ....................................................    2
     Section 1.01  General ................................................    2

ARTICLE II  THE CONTRIBUTION ..............................................   23
     Section 2.01  Intercorporate Reorganization ..........................   23
     Section 2.02  Financial Instruments ..................................   27
     Section 2.03  Intercompany Accounts and Arrangements .................   28
     Section 2.04  Cash Management ........................................   28
     Section 2.05  The Washington Board ...................................   30
     Section 2.06  Resignations; Transfer of Stock Held as Nominee ........   30
     Section 2.07  Washington Certificate of Incorporation and By-laws ....   31
     Section 2.08  Consents ...............................................   31

ARTICLE III  THE DISTRIBUTION .............................................   32
     Section 3.01  The Distribution .......................................   32
     Section 3.02  Cooperation Prior to the Distribution ..................   33
     Section 3.03  Conditions to the Distribution .........................   33
     Section 3.04  Waiver of Conditions ...................................   34
     Section 3.05  Disclosure .............................................   34

ARTICLE IV  MUTUAL RELEASE; INDEMNIFICATION; EXPENSES .....................   34
     Section 4.01  Mutual Release .........................................   34
     Section 4.02  Indemnification by Conexant ............................   35
     Section 4.03  Indemnification by Washington ..........................   36
     Section 4.04  Limitations on Indemnification Obligations .............   36
     Section 4.05  Procedures Relating to Indemnification .................   38
     Section 4.06  Remedies Cumulative ....................................   39
     Section 4.07  Survival of Indemnities ................................   40
     Section 4.08  Exclusivity of Tax Allocation Agreement ................   40
     Section 4.09  Expenses ...............................................   40
     Section 4.10  Effect of Investigation ................................   41

ARTICLE V  CERTAIN OTHER MATTERS ..........................................   41
     Section 5.01  Insurance ..............................................   41
     Section 5.02  Use of Names, Trademarks, etc ..........................   43
     Section 5.03  License of Intellectual Property .......................   46
     Section 5.04  Software and Other License Agreements ..................   52
     Section 5.05  Non-Solicitation of Employees ..........................   52

ARTICLE VI  ACCESS TO INFORMATION .........................................   53
     Section 6.01  Provision of Corporate Records .........................   53
</TABLE>


                                        i
<PAGE>
<TABLE>
<S>                                                                          <C>
     Section 6.02  Access to Information ..................................   53
     Section 6.03  Production of Witnesses ................................   54
     Section 6.04  Retention of Records ...................................   55
     Section 6.05  Confidentiality ........................................   55

ARTICLE VII  MISCELLANEOUS ................................................   56
     Section 7.01  Entire Agreement; Construction .........................   56
     Section 7.02  Survival of Agreements .................................   56
     Section 7.03  Governing Law ..........................................   56
     Section 7.04  Notices ................................................   56
     Section 7.05  Dispute Resolution .....................................   58
     Section 7.06  Amendments .............................................   58
     Section 7.07  Assignment .............................................   58
     Section 7.08  Captions; Currency .....................................   59
     Section 7.09  Severability ...........................................   59
     Section 7.10  Parties in Interest ....................................   59
     Section 7.11  Schedules ..............................................   60
     Section 7.12  Waivers; Remedies ......................................   60
     Section 7.13  Further Assurances .....................................   60
     Section 7.14  Counterparts ...........................................   60
     Section 7.15  Performance ............................................   60
     Section 7.16  Currency Calculations ..................................   60
     Section 7.17  Interpretation .........................................   61
</TABLE>


                                       ii
<PAGE>
                     CONTRIBUTION AND DISTRIBUTION AGREEMENT


            CONTRIBUTION AND DISTRIBUTION AGREEMENT (this "Agreement"), dated as
of December 16, 2001, as amended as of June 25, 2002, by and between CONEXANT
SYSTEMS, INC., a Delaware corporation ("Conexant"), and WASHINGTON SUB, INC., a
Delaware corporation and a wholly-owned subsidiary of Conexant ("Washington").

            WHEREAS, Conexant, Washington and Alpha Industries, Inc., a Delaware
corporation ("Alpha"), have entered into an Agreement and Plan of
Reorganization, dated as of December 16, 2001, as amended as of April 12, 2002
(the "Merger Agreement"), providing for, among other things, the merger of
Washington with and into Alpha, with Alpha being the surviving corporation (the
"Merger");

            WHEREAS, it is a condition to the Merger that, prior to the
Effective Time (as defined in the Merger Agreement), the Contribution (as
defined herein) and the Distribution (as defined herein) be completed;

            WHEREAS, subject to the terms and conditions contained herein,
immediately prior to the Effective Time, the Conexant Board (as defined herein)
will cause Conexant to distribute to the holders of shares of Common Stock, par
value $1 per share, of Conexant ("Conexant Common Stock") and Conexant Series B
Preferred Stock (as defined herein), other than shares held in the treasury of
Conexant, on a one share-for-one share basis as provided for herein, issued and
outstanding shares of Common Stock, par value $.01 per share, of Washington
("Washington Common Stock") (the "Distribution");

            WHEREAS, subject to the terms and conditions contained herein,
immediately prior to the Distribution, Conexant and the Conexant Subsidiaries
(as defined herein) will transfer the Washington Assets and the Washington
Subsidiaries (each as defined herein) to Washington or one of the Washington
Subsidiaries and Washington and the Washington Subsidiaries will assume the
Washington Liabilities (as defined herein), all as more fully described in this
Agreement (the "Contribution");

            WHEREAS, Conexant and Washington have determined that it is
appropriate and desirable to set forth the principal corporate transactions
required to effect the Contribution and the Distribution and certain other
agreements that will govern certain matters relating to the Contribution and the
Distribution and the relationship of Conexant, Washington and the respective
members of the Conexant Group and the Washington Group (each as defined herein)
following the Contribution and the Distribution; and

            WHEREAS, the parties to this Agreement intend that the Contribution
and the Distribution qualify under Sections 355 and 368 of the Code (as defined
herein) as a reorganization and that the Merger qualifies under Section 368 of
the Code as a reorganization.
<PAGE>
            NOW, THEREFORE, in consideration of the premises and of the
respective agreements and covenants contained in this Agreement, the parties
hereby agree as follows:

                                   ARTICLE I

                                   DEFINITIONS

            Section 1.01 General. As used in this Agreement, the following terms
shall have the following meanings (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):

            "1999 Indenture" means the Indenture dated as of May 12, 1999
between Conexant and The First National Bank of Chicago, as Trustee.

            "2000 Indenture" means the Indenture dated as of February 1, 2000
between Conexant and Bank One Trust Company, National Association, as Trustee.

            "Accounts Receivable" means accounts, loans and notes receivable
(whether current or not current), including receivables due from employees, and
all proceeds thereof and rights to payment with respect thereto.

            "Action" means, with respect to any Person, any actual or threatened
or future action, suit, arbitration, inquiry, proceeding or investigation by or
before any Governmental Entity or any claims or other legal matters that have
been or may be asserted by or against, or otherwise affect, such Person.

            "Administrative Services" shall have the meaning set forth in
Section 5.03(e)(i)(A).

            "Administrative Services Software" shall have the meaning set forth
in Section 5.03(e)(i)(B).

            "Affiliate" means, with respect to any specified Person, any other
Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person; provided, however, that for purposes of the Transaction Agreements,
following the Time of Distribution, no member of either Group shall be deemed to
be an Affiliate of any member of the other Group. For purposes of the
immediately preceding sentence, the term "control" (including, with correlative
meanings, the terms "controlled by" and "under common control with"), as used
with respect to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of such
Person, whether through ownership of voting securities, by contract or
otherwise.

            "Agreement" shall have the meaning set forth in the preamble.

            "Alpha" shall have the meaning set forth in the recitals.


                                       2
<PAGE>
            "Ancillary Agreements" means, collectively, the Employee Matters
Agreement, the Tax Allocation Agreement, the Transition Agreement, the IT
Transition Services Agreement and the Conveyance and Assumption Instruments.

            "Asset/Liability Allocation Matter" shall have the meaning set forth
in Section 2.01(b).

            "Assets" means any and all assets, properties and rights, whether
tangible or intangible, real, personal or mixed, fixed, contingent or otherwise,
and wherever located (other than ownership interests in Subsidiaries), including
the following:

            (a) Real Property;

            (b) Machinery and Equipment;

            (c) Inventories;

            (d) bank accounts;

            (e) cash, cash on hand, cash equivalents, funds, certificates of
      deposit, similar instruments and travelers checks;

            (f) Accounts Receivable;

            (g) advances, performance and surety bonds, and interests as
      beneficiary under letters of credit and other similar instruments and all
      proceeds thereof;

            (h) Securities;

            (i) Hedging Arrangements;

            (j) Data and Records;

            (k) Patents and Trademarks;

            (l) Trade Secrets;

            (m) Contracts;

            (n) credits, prepayments, prepaid expenses, deposits and retentions
      held by third parties;

            (o) claims, causes of action, choses in action, rights under express
      or implied warranties, guarantees and indemnities and similar rights,
      rights of recovery, rights of set-off, rights of subrogation and all other
      rights of any kind (including the right to receive mail and other
      communications);

            (p) Permits;


                                       3
<PAGE>
            (q) goodwill and going concern value; and

            (r) other intangible assets not otherwise included in clauses (a)
      through (q) of this definition.

            "Assigning Party" shall have the meaning set forth in Section 2.08.

            "Audited Balance Sheet" means the combined balance sheet of the
Washington Business as of September 30, 2001, together with the notes thereto,
audited by Deloitte & Touche LLP, prepared in accordance with U.S. generally
accepted accounting principles.

            "By-laws" means Washington's amended by-laws in the form attached
hereto as Schedule 1.01(a).

            "Capital Expenditures" means the out-of-pocket fees, costs and
expenses incurred by Conexant or any of its Subsidiaries (including members of
the Washington Group) in respect of purchases of capital equipment by Conexant
for or on behalf the Washington Group in the amounts set forth on Schedules 2.04
and 4.09.

            "Cash" means all cash, cash on hand, cash equivalents, funds,
certificates of deposit, similar instruments and travelers checks held by
Conexant or any of its Subsidiaries and Affiliates (including members of the
Washington Group) immediately prior to the Time of Distribution.

            "Certificate of Incorporation" means Washington's restated
certificate of incorporation in the form attached hereto as Schedule 1.01(g).

            "China/Mauritius Outstanding Checks" shall have the meaning set
forth in Section 2.04(c)(ii).

            "Claims Administration" means the processing of claims made under
Policies, including the reporting of claims to the insurance carrier, management
and defense of claims, and providing for appropriate releases upon settlement of
claims.

            "Claims Made Policies" shall have the meaning set forth in Section
5.01(b).

            "Code" means the Internal Revenue Code of 1986, as amended, or any
successor legislation.

            "Combined Company" shall have the meaning set forth in the Merger
Agreement.

            "Conexant" shall have the meaning set forth in the preamble.

            "Conexant Assets" means the following:


                                       4
<PAGE>
            (a) all rights of any member of the Conexant Group under any
      Transaction Agreement to which it is or becomes a party;

            (b) all Assets which are expressly allocated to any member of the
      Conexant Group pursuant to any Ancillary Agreement, the Newbury Supply
      Agreement or the Newport Supply Agreement;

            (c) the following specifically enumerated Assets which immediately
      prior to the Time of Distribution are owned by Conexant or any of its
      Subsidiaries (including members of the Washington Group), in each case
      whether or not such Assets are used in or relate to the Conexant Business
      or the Washington Business:

                  (i) (A) all Conexant Bank Accounts and (B) all Cash (including
            all Cash contained in the Conexant Bank Accounts and the Washington
            Bank Accounts);

                  (ii) all Machinery and Equipment other than that set forth on
            Schedule 1.01(b); provided, however, that it is understood and
            agreed that it is the intent of the parties hereto that all
            Machinery and Equipment used exclusively in the Washington Business
            or exclusively by persons who are employed in the Washington
            Business at the Time of Distribution be Washington Assets, and any
            such Machinery and Equipment (other than Machinery and Equipment set
            forth on Schedule 1.01(f)) shall be a Washington Asset
            notwithstanding the fact that it has not been included, through
            inadvertence or otherwise, on Schedule 1.01(b);

                  (iii) all Securities;

                  (iv) all Hedging Arrangements;

                  (v) all Patents and Trademarks other than those set forth on
            Schedule 1.01(c);

                  (vi) all Accounts Receivable;

                  (vii) all Policies and all rights, benefits and privileges
            thereunder and related thereto (including the right to receive any
            and all return premiums with respect thereto), other than rights
            with respect to Policies to the extent provided in Sections 5.01(b)
            and 5.01(c);

                  (viii) other than as provided for in Section 5.02, all rights
            in, and to the use of, the Conexant Marks;

                  (ix) all rights in, and to the use of, the names, trademarks,
            trade names, domain names and service marks "Mindspeed", "Mindspeed
            Technologies" and "Mindspeed Technologies, Inc." and all corporate
            symbols and logos related thereto and all names, trademarks, trade
            names, domain


                                       5
<PAGE>
            names and service marks which include the words "Mindspeed",
            "Mindspeed Technologies" or "Mindspeed Technologies, Inc." or any
            derivative thereof;

                  (x) all Real Property (including the wafer fabrication and
            other manufacturing, assembly and test facilities and other
            facilities located at Newport Beach, California, San Diego,
            California, Mexicali, Mexico and El Paso, Texas and the real
            property and fixtures associated therewith) other than the
            Washington Real Property;

                  (xi) all Inventories other than Washington Inventories;

                  (xii) all Assets, including the stock and assets of
            Maquiladora (as defined in the Facility Sale Agreement), subject to
            the Facility Sale Agreement and the U.S. Asset Purchase Agreement;

                  (xiii) all Assets set forth on Schedule 1.01(f); and

                  (xiv) the Conexant Bluetooth Baseband Solution;

            (d) all other Assets which immediately prior to the Time of
      Distribution are owned by Conexant or any of its Subsidiaries (including
      members of the Washington Group) that are not Washington Assets; and

            (e) all rights, choses in action, causes of action and claims of
      Conexant or any of its Subsidiaries (including members of the Washington
      Group) to the extent relating to any asset described in clauses (a)
      through (d) above.

            Anything contained herein to the contrary notwithstanding, assets
described in paragraphs (b) and (c) of the definition of "Washington Assets"
will not be included in Conexant Assets.

            "Conexant Bank Accounts" means all bank accounts of Conexant or any
of its Subsidiaries (including members of the Washington Group) immediately
prior to the Time of Distribution, other than Washington Bank Accounts.

            "Conexant Bluetooth Baseband Solution" means the Bluetooth baseband
solution known internally at Conexant as "Albert" and "Cobalt", the ownership of
which is retained by Conexant at the Time of Distribution.

            "Conexant Board" means the Board of Directors of Conexant or a duly
authorized committee thereof.

            "Conexant Business" means (a) the businesses and operations engaged
in prior to the Time of Distribution by the members of the Pre-Distribution
Group (but with respect to each such member who has ceased to be an Affiliate of
Conexant or its predecessors, only businesses engaged in prior to the time that
such member of the Pre-Distribution Group ceased to be an Affiliate of Conexant
or its predecessors) of researching, developing,


                                       6
<PAGE>
designing, engineering, manufacturing, having manufactured, assembling, having
assembled, selling, distributing, installing, modifying, repairing, servicing
and supporting semiconductor products and systems for communications electronics
markets such as personal computers, personal imaging devices, wireless
communications products, network access products, digital information and
entertainment products, and activities related thereto, (b) Former Businesses
related to any of the foregoing, including Former Businesses set forth on
Schedule 1.01(d), and (c) activities related to the foregoing, in the case of
each of the foregoing clauses (a), (b) and (c), other than any businesses,
operations or activities included in the Washington Business. The parties
acknowledge that businesses contained in the Conexant Business have in the past
operated under the names Mindspeed Technologies, Network Access Division,
Digital Infotainment Division, Personal Imaging Division and Personal Computing
Division.

            "Conexant Common Stock" shall have the meaning set forth in the
recitals.

            "Conexant Expenses" means the following out-of-pocket fees, costs
and expenses of Conexant or any of its Subsidiaries (including members of the
Washington Group), whether incurred and/or paid before, at or after the Time of
Distribution:

            (a) all out-of-pocket fees, costs and expenses incurred in
      connection with the preparation, execution and delivery of the Facility
      Sale Agreement, the U.S. Asset Purchase Agreement and the Facility
      Services Agreement; and

            (b) all out-of-pocket fees, costs and expenses relating to the
      Contribution, the Distribution and/or the Merger to the extent the same
      relate to operations of the Conexant Business after the Time of
      Distribution.

            "Conexant Financial Instruments" means those credit facilities,
guaranties, foreign currency forward exchange contracts, comfort letters,
letters of credit and similar instruments related to the Conexant Business under
which any member of the Washington Group has any primary, secondary, contingent,
joint, several or other Liability after the Time of Distribution (a) set forth
on Schedule 1.01(e) or (b) entered into between December 16, 2001 and the Time
of Distribution in the ordinary course of business.

            "Conexant Group" means Conexant and the Conexant Subsidiaries.

            "Conexant Indemnitees" means each member of the Conexant Group and
each of their respective Representatives and Affiliates and each of the heirs,
executors, successors and assigns of any of the foregoing.

            "Conexant Liabilities" means the following:

            (a) all Liabilities of any member of the Conexant Group under any
      Transaction Agreement to which it is or becomes a party (including
      Liabilities related to outstanding checks allocated to any member of the
      Conexant Group under Section 2.04);


                                       7
<PAGE>
            (b) all Liabilities for which any member of the Conexant Group is
      expressly made responsible pursuant to any Ancillary Agreement, the
      Newbury Supply Agreement or the Newport Supply Agreement;

            (c) the following specifically enumerated Liabilities of Conexant or
      any of its Subsidiaries (including members of the Washington Group), in
      each case whether or not such Liabilities relate to the Conexant Business,
      the Conexant Assets, the Washington Business or the Washington Assets:

                  (i) all Liabilities in respect of the Convertible Notes;

                  (ii) all accounts payable accrued in the accounts payable
            account on the books of Conexant and its Subsidiaries (including
            members of the Washington Group) immediately prior to the Time of
            Distribution (subject to Section 4.09); and

                  (iii) all Liabilities specified in writing by Conexant to
            Washington pursuant to Section 2.01(d)(ii), if and to the extent
            required by Section 2.01(d)(ii); and

            (d) all other Liabilities of Conexant or any of its Subsidiaries
      (including members of the Washington Group) in respect of operations
      engaged in prior to the Time of Distribution that are not Washington
      Liabilities.

            Anything contained herein to the contrary notwithstanding,
Liabilities described in paragraphs (b) and (c) of the definition of "Washington
Liabilities" will not be included in Conexant Liabilities.

            "Conexant License Agreement" shall have the meaning set forth in
Section 5.04.

            "Conexant Marks" means the names, trademarks, trade names, domain
names and service marks "Conexant", "Conexant Systems" and "Conexant Systems,
Inc." and all corporate symbols and logos related thereto and all names,
trademarks, trade names, domain names and service marks which include the words
"Conexant", "Conexant Systems" or "Conexant Systems, Inc." or any derivative
thereof.

            "Conexant Series B Preferred Stock" means the Series B Voting
Preferred Stock, without par value, of Conexant, one share of which is issued
and outstanding as of December 16, 2001.

            "Conexant Spin-Off" shall have the meaning set forth in Section
5.03(b)(iii).

            "Conexant Subsidiary" means each Subsidiary of Conexant other than
Washington and the Washington Subsidiaries.


                                       8
<PAGE>
            "Consents" means consents, approvals, waivers, clearances,
exemptions, allowances, novations, authorizations, filings, registrations and
notifications.

            "Contracts" means all agreements, real estate and other leases,
contracts (including employee contracts), licenses, memoranda of understanding,
letters of intent, sales orders, purchase orders, open bids and other
commitments, including in each case, all amendments, modifications and
supplements thereto and waivers and consents thereunder.

            "Contribution" shall have the meaning set forth in the recitals.

            "Convertible Notes" means Conexant's (a) 4-1/4% convertible
subordinated notes due May 1, 2006 issued under the 1999 Indenture and (b) 4%
convertible subordinated notes due February 1, 2007 issued under the 2000
Indenture.

            "Conveyance and Assumption Instruments" means, collectively, the
various agreements, deeds (including transfer deeds for Real Property), bills of
sale, stock powers, certificates of title, instruments of conveyance and
assignment, instruments of assumption and other instruments and documents which
are, in the reasonable opinion of Conexant, Washington and Alpha, necessary or
desirable to effect the transfer of Assets and Subsidiaries and the assumption
of Liabilities contemplated by the transactions described in Section 2.01.

            "Data and Records" means financial, accounting, corporate,
operating, design, manufacturing, test and other data and records (in each case,
in whatever form or medium, including electronic media), including books,
records, notes, sales and sales promotional material and data, advertising
materials, credit information, cost and pricing information, customer, supplier
and agent lists, other records pertaining to customers, business plans,
reference catalogs, payroll and personnel records and procedures, blue-prints,
research and development files, data and laboratory books, sales order files,
litigation files, minute books, stock ledgers, stock transfer records and other
similar data and records.

            "Dispute" shall have the meaning set forth in Section 7.05.

            "Distribution" shall have the meaning set forth in the recitals.

            "Distribution Agent" means the distribution agent selected by
Conexant to distribute Washington Common Stock in connection with the
Distribution.

            "Distribution Date" means the date determined by the Conexant Board
in accordance with Section 3.01 as the date as of which the Distribution will be
effected.

            "Effective Time" shall have the meaning set forth in the Merger
Agreement.

            "Employee Matters Agreement" means the Employee Matters Agreement to
be entered into among Conexant, Washington and Alpha prior to the Time of
Distribution.

            "Facility Sale Agreement" shall have the meaning set forth in the
Merger Agreement.


                                       9
<PAGE>
            "Facility Services Agreement" shall have the meaning set forth in
the Merger Agreement.

            "Former Business" means any corporation, partnership, entity,
division, business unit, business, assets, plants, product line, operations or
contract (including any assets and liabilities comprising the same) that has
been sold, conveyed, assigned, transferred or otherwise disposed of or divested
(in whole or in part) by any member of the Pre-Distribution Group or the
operations, activities or production of which has been discontinued, abandoned,
completed or otherwise terminated (in whole or in part) by any member of the
Pre-Distribution Group.

            "Governmental Entity" means any government or any court, arbitral
tribunal, administrative agency or commission or other governmental or
regulatory authority or agency, federal, state, local, domestic, foreign or
international.

            "Group" means the Conexant Group or the Washington Group, as
applicable.

            "Hedging Arrangements" means swaps, collars, caps and other hedging
arrangements of any kind.

            "Indemnifiable Losses" means any and all losses, Liabilities,
claims, damages, deficiencies, obligations, fines, payments, Taxes, Liens, costs
and expenses, matured or unmatured, absolute or contingent, accrued or
unaccrued, liquidated or unliquidated, known or unknown, whenever arising and
whether or not resulting from Third Party Claims (including the costs and
expenses of any and all Actions; all amounts paid in connection with any
demands, assessments, judgments, settlements and compromises relating thereto;
interest and penalties with respect thereto; out-of-pocket expenses and
reasonable attorneys', accountants' and other experts' fees and expenses
reasonably incurred in investigating, preparing for or defending against any
such Actions or in asserting, preserving or enforcing an Indemnitee's rights
hereunder; and any losses that may result from the granting of injunctive relief
as a result of any such Actions).

            "Indemnifying Party" shall have the meaning set forth in Section
4.04(a).

            "Indemnitee" means any of the Conexant Indemnitees or the Washington
Indemnitees who or which is entitled to seek indemnification under this
Agreement.

            "Indemnity Reduction Amounts" shall have the meaning set forth in
Section 4.04(a).

            "Information" means all records, books, contracts, instruments,
computer data and other data and information (in each case, in whatever form or
medium, including electronic media).

            "Information Statement" means the information statement with respect
to Washington sent to holders of Conexant Common Stock and Conexant Series B
Preferred Stock in connection with the Distribution.


                                       10
<PAGE>
            "Insurance Proceeds" means monies (a) received by an insured from an
insurance carrier, (b) paid by an insurance carrier on behalf of an insured or
(c) received from any third party in the nature of insurance, contribution or
indemnification in respect of any Liability.

            "Intellectual Property" shall have the meaning set forth in Section
5.03(a)(i).

            "Inventories" means inventories, including raw materials,
work-in-process, materials, components, finished goods, parts, accessories and
supplies.

            "IRS" means the Internal Revenue Service.

            "IT Transition Services Agreement" means the IT Transition Services
Agreement to be entered into between Conexant and Alpha prior to the Time of
Distribution, among other things, providing for various IT services to be
provided by Conexant to Alpha following the Distribution Date.

            "Liabilities" means any and all claims, debts, liabilities,
commitments and obligations of whatever nature, whether fixed, contingent or
absolute, matured or unmatured, liquidated or unliquidated, accrued or not
accrued, known or unknown, due or to become due, whenever or however arising and
whether or not the same would be required by generally accepted accounting
principles to be reflected as a liability in financial statements or disclosed
in the notes thereto, including all costs and expenses relating thereto and
those claims, debts, liabilities, commitments and obligations:

            (a) based upon, arising out of or relating to any law, statute,
      rule, regulation, judgment, order, decision or consent decree of any
      Governmental Entity or any noncompliance therewith or breach or violation
      of any thereof;

            (b) in respect of accounts payable;

            (c) based upon, arising out of or relating to workers' compensation,
      automobile liability, general liability, product liability, intellectual
      property liability and other claims and matters (whether direct or for
      indemnification of any Person or otherwise, and whether insured or
      uninsured);

            (d) based upon, arising out of or relating to Actions or any award
      of any arbitrator of any kind;

            (e) in respect of salary, bonuses, incentive payments, severance
      payments and other compensation payments and all Taxes and withholdings
      related thereto;

            (f) in respect of employee welfare and fringe benefits (including
      claims for medical and disability benefits);

            (g) based upon, arising out of or relating to environmental matters
      (including the presence, release or threatened release of hazardous
      materials or any


                                       11
<PAGE>
      other environmental conditions or the violation of any environmental
      laws), including all removal, remediation and cleanup costs, investigatory
      costs, settlement costs, governmental response costs, natural resources
      damages, property damages, personal injury damages and all other costs and
      damages;

            (h) based upon, arising out of or relating to Contracts;

            (i) based upon, arising out of or relating to torts (whether based
      on negligence, strict liability or otherwise) or infringements; and

            (j) in respect of products and services, including warranty
      liabilities, deferred revenues, product liability claims and liabilities
      in respect of the return, repair or replacement of products.

            "Lien" means any lien, security interest, pledge, mortgage, charge,
restriction, retention of title agreement or other encumbrance of whatever
nature.

            "Local Closing Time" means (i) with respect to each Washington Bank
Account (other than the Washington Bank Accounts in China and Mauritius), the
close of business (local time at the location of such Washington Bank Account)
on the Distribution Date and (ii) with respect to each of the Washington Bank
Accounts in China and Mauritius, the close of business (local time at the
location of such Washington Bank Account) on the date such account is actually
transferred to Washington.

            "Lucent License Agreement" means the license agreement effective
October 1, 1999 between Conexant and Lucent Technologies GRL Corporation.

            "Machinery and Equipment" means machinery, equipment, tooling,
vehicles, furniture and fixtures, leasehold improvements, repair parts, tools,
plant, laboratory and office equipment and supplies, computer hardware and
software, computer networking equipment, engineering and design equipment, test
equipment and other tangible personal property (other than tangible personal
property included in other categories of assets in the definition of "Assets"),
together with any rights or claims arising out of maintenance or service
contracts relating thereto or the breach of any express or implied warranty by
the manufacturers or sellers of any of such assets or any component part
thereof.

            "Material Adverse Effect" shall have the meaning set forth in the
Merger Agreement.

            "Merger" shall have the meaning set forth in the recitals.

            "Merger Agreement" shall have the meaning set forth in the recitals.

            "Net Asset Deficiency" shall have the meaning set forth in Section
2.01(d)(ii).

            "Newbury Supply Agreement" shall have the meaning set forth in the
Merger Agreement.


                                       12
<PAGE>
            "Newport Supply Agreement" shall have the meaning set forth in the
Merger Agreement.

            "Occurrence Basis Policies" shall have the meaning set forth in
Section 5.01(b).

            "Patents and Trademarks" means (a) all patents (including utility
and design patents, industrial designs and utility models), patent applications
and patent and invention disclosures, together with all reissuances,
continuations, continuations-in-part, divisions, revisions, supplementary
protection certificates, extensions and re-examinations thereof, and any other
U.S. or foreign patent rights entitled to the same priority claim (in whole or
in part) as any of the foregoing, (b) trademarks, service marks, trade names,
trade dress, logos, Internet domain names, business and product names and
slogans and all registrations and applications for registration of any of the
foregoing, (c) copyrights and all applications, registrations and renewals in
connection therewith and (d) mask work and semiconductor chip right
applications, registrations and renewals in connection therewith.

            "Permits" means licenses, permits, authorizations, consents,
certificates, registrations, variances, franchises and other approvals from any
Governmental Entity, including those relating to environmental matters.

            "Person" means any individual, partnership, joint venture,
corporation, limited liability entity, trust, unincorporated organization or
other entity (including a Governmental Entity).

            "Performance Plan Shares" means an aggregate of One Million Four
Hundred Thousand (1,400,000) shares of Washington Common Stock, representing the
number of shares of Washington Common Stock that would have been distributed in
the Distribution in respect of One Million Four Hundred Thousand (1,400,000)
shares of Conexant Common Stock reserved for issuance to holders of outstanding
Performance Units under the Conexant Systems, Inc. 2001 Performance Share Plan
if those shares of Conexant Common Stock had been issued and outstanding as of
the Record Date.

            "Philsar" means Philsar Semiconductor Inc., a Conexant Subsidiary.

            "Philsar Exchangeable Shares" means the Exchangeable Shares of
Philsar which are exchangeable at any time, and from time to time, at the
election of the holder thereof (other than Conexant or a Conexant Subsidiary)
into one share of Conexant Common Stock for each Exchangeable Share and which
are entitled, pursuant to the terms of the Exchangeable Shares (other than
Exchangeable Shares held by Conexant or any Conexant Subsidiary) to participate
with the holders of Conexant Common Stock in any distribution or dividend
payable on Conexant Common Stock.

            "Philsar Marks" shall have the meaning set forth in Section 5.02(d).

            "Policies" means all insurance policies, insurance contracts and
claim administration contracts of any kind of Conexant and its Subsidiaries
(including members of


                                       13
<PAGE>
the Washington Group) and their predecessors which were or are in effect at any
time at or prior to the Time of Distribution (other than insurance policies,
insurance contracts and claim administration contracts established in
contemplation of the Distribution and the Merger to cover only Washington and
its Subsidiaries after the Time of Distribution), including primary, excess and
umbrella, commercial general liability, fiduciary liability, product liability,
automobile, aircraft, property and casualty, business interruption, directors
and officers liability, employment practices liability, workers' compensation,
crime, errors and omissions, special accident, cargo and employee dishonesty
insurance policies and captive insurance company arrangements, together with all
rights, benefits and privileges thereunder.

            "Pre-Distribution Group" means (a) each of Conexant, the
Subsidiaries of Conexant existing immediately prior to the Time of Distribution
(including members of the Washington Group) and Persons that have ceased to be
Subsidiaries of Conexant prior to the Time of Distribution, (b) each of the
predecessors of each of the foregoing (including Rockwell) and (c) each of the
Persons that have ceased to be Subsidiaries and other Affiliates of each of the
foregoing and their predecessors prior to the Time of Distribution.
Notwithstanding the foregoing, (i) Boeing North American, Inc. and Persons who
are Affiliates of Boeing North American, Inc. after December 6, 1996 will not
constitute members of the Pre-Distribution Group for periods after December 6,
1996 and (ii) Rockwell and Persons who are Affiliates of Rockwell after December
31, 1998 will not constitute members of the Pre-Distribution Group for periods
after December 31, 1998.

            "Printing Expenses" means all out-of-pocket fees, costs and expenses
incurred by Conexant in connection with the filing, printing and mailing of the
Form S-4 and the Proxy Statement/Prospectus (each as defined in the Merger
Agreement).

            "Privileged Information" means, with respect to a Group, Information
regarding a member of such Group, or any of its operations, employees, Assets or
Liabilities (whether in documents or stored in any other form or known to its
employees or agents) that is or may be protected from disclosure pursuant to the
attorney-client privilege, the work product doctrine or other applicable
privileges, that a member of the other Group has or may come into possession of
or has obtained or may obtain access to pursuant to this Agreement or otherwise.

            "Real Property" means real property (including land, plants,
buildings, fixtures and improvements) and real property interests (including
real property leases).

            "Recipient Party" shall have the meaning set forth in Section 2.08.

            "Record Date" means 11:57 p.m. Eastern Time on the Distribution
Date.

            "Recorded Amount" means the amount of (i) cash on deposit in each of
the Washington Bank Accounts as reflected in bank account statements in respect
of such Washington Bank Accounts as of the applicable Local Closing Time and
(ii) wire transfers to any of the Washington Bank Accounts initiated prior to
the applicable Local Closing Time


                                       14
<PAGE>
but credited to the Washington Bank Accounts thereafter. No deduction from such
amounts shall be made in respect of any outstanding checks.

            "Reorganization Agreements" shall have the meaning set forth in the
Merger Agreement.

            "Representative" means, with respect to any Person, any of such
Person's directors, officers, employees, agents, consultants, advisors,
accountants, attorneys and representatives.

            "Rockwell" means Rockwell Automation, Inc. (formerly named Rockwell
International Corporation), a Delaware corporation.

            "Rockwell Distribution Agreement" means the Distribution Agreement
dated as of December 31, 1998 between Conexant and Rockwell.

            "Securities" means short-term and long-term investments, banker's
acceptances, shares of stock, notes, bonds, debentures, evidences of
indebtedness, certificates of interest or participation in profit-sharing
agreements, collateral-trust certificates, preorganization certificates or
subscriptions, transferable shares, puts, calls, straddles, options, investment
contracts, voting trusts and certificates and other securities of any kind
(other than ownership interests in Subsidiaries).

            "Settlement Claim" means any claim asserted by Conexant or any of
its Subsidiaries (including members of the Washington Group) under any Policies
in respect of payments made by Conexant pursuant to the settlement and release
agreement identified on Schedule 1.01(n) to the customer of the Washington
Business party thereto.

            "Special Purpose Statement of Tangible Net Assets" means the special
purpose statement as of September 30, 2001 of tangible assets and liabilities to
be contributed by Conexant and its Subsidiaries to the Washington Group, which
will be derived from the Audited Balance Sheet, will contain only those line
items contained in the Unaudited Special Purpose Statement of Tangible Net
Assets (which line items will be in the same amounts as the corresponding line
items in the Audited Balance Sheet, unless otherwise provided in the methodology
set forth in the notes to the Unaudited Special Purpose Statement of Tangible
Net Assets) and will be prepared using the same methodology set forth in the
notes to the Unaudited Special Purpose Statement of Tangible Net Assets.

            "Subsidiary" means, with respect to any Person, any corporation or
other organization, whether incorporated or unincorporated, of which such Person
or any Subsidiaries of such Person controls or owns, directly or indirectly,
more than 50% of the stock or other equity interest, or more than 50% of the
voting power entitled to vote on the election of members to the board of
directors or similar governing body; provided, however, that (except as
specifically noted herein) for purposes of this Agreement, none of Washington or
the Washington Subsidiaries shall be deemed to be a Conexant Subsidiary.


                                       15
<PAGE>

                  "Tax" and "Taxes" shall have the meaning set forth in the Tax
Allocation Agreement.

                  "Tax Allocation Agreement" means the Tax Allocation Agreement
to be entered into among Conexant, Washington and Alpha prior to the Time of
Distribution.

                  "Third Party Claim" shall have the meaning set forth in
Section 4.05(a).

                  "Time of Distribution" means 11:58 p.m. Eastern Time on the
Distribution Date.

                  "Trade Secrets" means (a) trade secrets and confidential
business and technical information (including ideas, research and development,
know-how, formulas, technology, compositions, manufacturing and production
processes and techniques, technical data, engineering, production and other
designs, drawings, engineering notebooks, industrial models, mask works,
semiconductor chip topographies, software and specifications and any other
information meeting the definition of a trade secret under the Uniform Trade
Secrets Act); (b) computer and electronic data processing programs and software,
both source code and object code (including data and related documentation, flow
charts, diagrams, descriptive texts and programs, computer print-outs,
underlying tapes, computer databases and similar items), computer applications
and operating programs; and (c) all copies and tangible embodiments of any or
all of the foregoing (in whatever form or medium, including electronic media).

                  "Transaction Agreements" means, collectively, this Agreement
and each Ancillary Agreement.

                  "Transition Agreement" means the Transition Services Agreement
to be entered into among Conexant, Washington and Alpha prior to the Time of
Distribution, among other things, providing for various service and other
relationships between Conexant and Alpha following the Distribution Date.

                  "Unaudited Special Purpose Statement of Tangible Net Assets"
shall have the meaning set forth in the Merger Agreement.

                  "U.S. Asset Purchase Agreement" shall have the meaning set
forth in the Merger Agreement.

                  "Washington" shall have the meaning set forth in the preamble.

                  "Washington Assets" means the following:

                  (a) all rights of any member of the Washington Group under any
         Transaction Agreement to which it is or becomes a party;


                                       16
<PAGE>
                  (b) all Assets which are expressly allocated to any member of
         the Washington Group pursuant to any Ancillary Agreement, the Newbury
         Supply Agreement or the Newport Supply Agreement;

                  (c) the following specifically enumerated Assets which
         immediately prior to the Time of Distribution are owned by Conexant or
         any of its Subsidiaries (including members of the Washington Group), in
         each case whether or not such Assets are used in or relate to the
         Conexant Business or the Washington Business:

                           (i) the Washington Real Property (including the wafer
                  fabrication and other manufacturing facilities located in
                  Newbury Park, California set forth on Schedule 1.01(k) and the
                  real property and fixtures associated therewith);

                           (ii) Machinery and Equipment set forth on Schedule
                  1.01(b); provided, however, that it is understood and agreed
                  that it is the intent of the parties hereto that all Machinery
                  and Equipment used exclusively in the Washington Business or
                  exclusively by persons who are employed in the Washington
                  Business at the Time of Distribution be Washington Assets, and
                  any such Machinery and Equipment (other than Machinery and
                  Equipment set forth on Schedule 1.01(f)) shall be a Washington
                  Asset notwithstanding the fact that it has not been set forth,
                  through inadvertence or otherwise, on Schedule 1.01(b);

                           (iii) the Washington Inventories;

                           (iv) the trademarks and trademark registrations and
                  applications for registrations thereof and issued patents,
                  patent applications and patent and invention disclosures
                  (including any foreign counterparts) set forth on Schedule
                  1.01(c);

                           (v) other than as provided in Section 5.02, all
                  rights in, and to the use of, the Philsar Marks;

                           (vi) rights to the extent relating to the Washington
                  Business to receive indemnification from Rockwell pursuant to
                  the Rockwell Distribution Agreement;

                           (vii) all Assets set forth in the Special Purpose
                  Statement of Tangible Net Assets, other than those sold or
                  otherwise disposed of in the ordinary course of business prior
                  to the Time of Distribution consistent with the terms of the
                  Merger Agreement;

                           (viii) except as otherwise specifically provided
                  herein, all Assets of the kind that appear on the Special
                  Purpose Statement of Tangible Net Assets as would appear on a
                  balance sheet of Washington if prepared as of the Time of
                  Distribution, including all reserves and accruals maintained
                  by Conexant


                                       17
<PAGE>
                  (but excluding Assets described in clauses (b) and (c) of the
                  definition of "Conexant Assets");

                           (ix) all Assets specified in writing by Conexant to
                  Washington pursuant to Section 2.01(d)(ii), if and to the
                  extent required by Section 2.01(d)(ii);

                           (x) the Washington Bluetooth RF Solution; and

                           (xi) all Washington Bank Accounts.

                  (d) the following Assets (other than those described in
         paragraphs (b) and (c) of the definition of "Conexant Assets") which
         immediately prior to the Time of Distribution are owned by Conexant or
         any of its Subsidiaries (including members of the Washington Group) and
         which are used primarily in or relate primarily to the Washington
         Business, as the same shall exist as of such time:

                           (i) Contracts (other than real property leases);

                           (ii) advances, performance and surety bonds, and
                  interests as beneficiary under letters of credit and other
                  similar instruments and all proceeds thereof;

                           (iii) Data and Records;

                           (iv) Permits;

                           (v) Trade Secrets;

                           (vi) credits, prepayments, prepaid expenses, deposits
                  and retentions held by third parties;

                           (vii) claims, causes of action, choses in action,
                  rights under express or implied warranties, guarantees and
                  indemnities and similar rights, rights of recovery, rights of
                  set-off, rights of subrogation and all other rights of any
                  kind (including the right to receive mail and other
                  communications) (other than, in each such case, those relating
                  to the Conexant Assets described in clauses (b) or (c) of the
                  definition thereof); and

                           (viii) goodwill, going concern value and other
                  intangible assets not otherwise included in clauses (a)
                  through (q) of the definition of "Assets"; and

                  (e) all rights, choses in action, causes of action and claims
         of Conexant or any of its Subsidiaries (including members of the
         Washington Group) to the extent relating to any asset described in
         clauses (a) through (d) above.


                                       18
<PAGE>
                  Anything contained herein to the contrary notwithstanding,
assets described in paragraphs (b) and (c) of the definition of "Conexant
Assets" will not be included in Washington Assets.

                  "Washington Bank Accounts" means all bank accounts set forth
on Schedule 1.01(m).

                  "Washington Bluetooth RF Solution" means the Bluetooth RF
solutions known internally at Conexant as "Blue RF", "Blue Q" and "ULV Blue RF",
the ownership of which will be transferred to Washington at the Time of
Distribution.

                  "Washington Board" means the Board of Directors of Washington.

                  "Washington Business" means (a) the business and operations
engaged in prior to the Time of Distribution by the members of the
Pre-Distribution Group (but with respect to each such member who has ceased to
be an Affiliate of Conexant or its predecessors, only businesses engaged in
prior to the time that such member of the Pre-Distribution Group ceased to be an
Affiliate of Conexant or its predecessors) of researching, developing,
designing, engineering, manufacturing, having manufactured, assembling, having
assembled, selling, distributing, installing, modifying, repairing, servicing
and supporting semiconductor products and systems, including components,
subsystems and systems, for wireless voice and data communications applications,
including digital cellular handsets and base stations, as well as advanced
mobile terminals that support next-generation multimedia and high-speed web
browsing, for communications electronics markets as conducted by Conexant's
Wireless Communications Division, other than the Washington Data Business Unit,
and activities related thereto, (b) Former Businesses related to any of the
foregoing, including the Former Businesses set forth on Schedule 1.01(h) and (c)
activities related to the foregoing. Notwithstanding anything contained herein
to the contrary, the term "Washington Business" shall not include any of
Conexant's Mindspeed Technologies or Broadband access businesses, the Washington
Data Business Unit and activities related thereto.

                  "Washington Common Stock" shall have the meaning set forth in
the recitals.

                  "Washington Data Business Unit" means the business and
operations engaged in by Conexant's Wireless Communications Division prior to
the Time of Distribution of researching, developing, designing, engineering,
manufacturing, having manufactured, assembling, having assembled, selling,
distributing, installing, modifying, repairing, servicing and supporting the
PHS, DSS, standalone GPS and Bluetooth baseband hardware and software product
lines and the Bluetooth baseband hardware and software development efforts and
the support and development of Bluetooth radio frequency products associated
with such Bluetooth baseband hardware and software.

                  "Washington Expenses" means the following out-of-pocket fees,
costs and expenses of Conexant or any of its Subsidiaries (including members of
the Washington Group), in each case, whether incurred and/or paid before, at or
after the Time of Distribution and whether or not they constitute accounts
payable:


                                       19
<PAGE>
                  (a) all out-of-pocket fees, costs and expenses incurred in
         connection with the Contribution, the Distribution and/or the Merger,
         including any and all:

                           (i) transfer taxes;

                           (ii) out-of-pocket fees, costs and expenses incurred
                  in connection with any notices to customers or suppliers of
                  the Washington Business or other third parties that are party
                  to Contracts that constitute Washington Assets or relate to
                  Washington Liabilities regarding the Contribution, the
                  Distribution and/or the Merger;

                           (iii) out-of-pocket fees, costs and expenses incurred
                  in connection with the transfer of any Permits from Conexant
                  or any Conexant Subsidiary to Washington or any Washington
                  Subsidiary or the obtaining of any new (or the re-issuance of
                  any existing) Permits in the name of Washington or a
                  Washington Subsidiary;

                           (iv) out-of-pocket fees, costs and expenses incurred
                  in connection with the assignment or transfer of any
                  Contracts, Patents and Trademarks or Trade Secrets from
                  Conexant or any Conexant Subsidiary to Washington or any
                  Washington Subsidiary, including legal fees, costs and
                  expenses associated with such assignments or transfers;

                           (v) accounting, legal, investment banking and other
                  outside consultants' fees, costs and expenses;

                           (vi) the Printing Expenses; and

                           (vii) out-of-pocket fees, costs and expenses in
                  connection with the preparation, execution and delivery of the
                  Transaction Agreements and the Reorganization Agreements;

         provided, however, that Washington Expenses will not include (A) any
         such out-of-pocket fees, costs and expenses described in the definition
         of "Conexant Expenses" and (B) any such out-of-pocket fees, costs and
         expenses incurred in connection with any modification of or dispute
         with respect to the Transaction Agreements or the transactions
         contemplated thereby after the Distribution Date or any claim under
         Article IV;

                  (b) all out-of-pocket fees, costs and expenses relating to the
         Contribution, the Distribution and/or the Merger to the extent the same
         relate to operations of the Washington Business after the Time of
         Distribution; and

                  (c) the Capital Expenditures and the Washington License Fees.

                  The parties acknowledge and agree that Washington Expenses
shall include, but are not limited to, (i) the amounts set forth on Schedule
2.04, (ii) the amounts actually


                                       20
<PAGE>
incurred by Conexant and its Subsidiaries (including members of the Washington
Group) prior to the Time of Distribution set forth on Schedule 4.09 and (iii)
any additional out-of-pocket fees, costs and expenses actually incurred in
connection with the Contribution, the Distribution and/or the Merger (including
but not limited to those forecast to be incurred that are actually incurred) of
the type comprising the amounts included in the categories of expenses set forth
on Schedule 4.09.

                  "Washington Financial Instruments" means those credit
facilities, guaranties, foreign currency forward exchange contracts, comfort
letters, letters of credit and similar instruments related to the Washington
Business under which any member of the Conexant Group has any primary,
secondary, contingent, joint, several or other Liability, after the Time of
Distribution (a) set forth on Schedule 1.01(i) or (b) entered into between
December 16, 2001 and the Time of Distribution in the ordinary course of
business.

                  "Washington Group" means Washington and the Washington
Subsidiaries.

                  "Washington Indemnitees" means each member of the Washington
Group and each of their respective Representatives and Affiliates and each of
the heirs, executors, successors and assigns of any of the foregoing.

                  "Washington Inventories" means the following Inventories of
products of the Washington Business owned by Conexant and its Subsidiaries
(including members of the Washington Group) immediately prior to the Time of
Distribution:

                  (a) the following raw materials: (i) 100mm GaAs Combined
         Microwave Digital wafer substrates; (ii) 100mm GaAs epitaxial HBT wafer
         substrates; and (iii) assembly materials at Conexant's Mexicali
         assembly and test facility which are specific to the Washington
         Business;

                  (b) the following work-in-process:

                           (i) unprobed finished wafers at internal or external
                  locations awaiting the probe process;

                           (ii) probed wafer finish inventories;

                           (iii) die bank inventories at internal or external
                  locations awaiting assembly, packaging and test processes;

                           (iv) wafer fabrication and other work-in-process at
                  Conexant's Newbury Park wafer fabrication facility; and

                           (v) work-in-process at Conexant's Mexicali assembly
                  and test facility which are specific to the Washington
                  Business; and

                  (c) finished goods.


                                       21
<PAGE>
                  "Washington Liabilities" means the following:

                  (a) all Liabilities of any member of the Washington Group
         under any Transaction Agreement to which it is or becomes a party
         (including Liabilities related to outstanding checks allocated to any
         member of the Washington Group under Section 2.04);

                  (b) all Liabilities for which any member of the Washington
         Group is expressly made responsible pursuant to any Ancillary
         Agreement, the Newbury Supply Agreement or the Newport Supply
         Agreement;

                  (c) the following specifically enumerated Liabilities of
         Conexant or any of its Subsidiaries (including members of the
         Washington Group), in each case whether or not such Liabilities relate
         to the Conexant Business, the Conexant Assets, the Washington Business
         or the Washington Assets:

                           (i) all Liabilities based upon, arising out of or
                  relating to the Actions set forth on Schedule 1.01(j); and

                           (ii) all Liabilities to the extent set forth in the
                  Special Purpose Statement of Tangible Net Assets, other than
                  those satisfied in the ordinary course of business prior to
                  the Time of Distribution; and

                  (d) all Liabilities (other than those described in paragraphs
         (b) and (c) of the definition of "Conexant Liabilities") of Conexant or
         any of its Subsidiaries (including members of the Washington Group) to
         the extent based upon, arising out of or relating to the Washington
         Assets or the Washington Business, including:

                           (i) all Liabilities (including Liabilities arising
                  out of any breaches or violations) to the extent relating to
                  the Washington Business based upon, arising out of or relating
                  to Contracts (whether or not such Contracts constitute
                  Washington Assets) (including any primary, secondary,
                  contingent or other obligations, such as under guaranties or
                  indemnities, in respect of such Contracts); and

                           (ii) all Liabilities to the extent relating to the
                  Washington Assets or the Washington Business for which
                  Conexant has agreed to indemnify Rockwell and certain other
                  Persons pursuant to the Rockwell Distribution Agreement.

                  Anything contained herein to the contrary notwithstanding,
Liabilities described in paragraphs (b) and (c) of the definition of "Conexant
Liabilities" will not be included in Washington Liabilities.

                  "Washington License Fees" means all out-of pocket costs, fees
and expenses incurred by Conexant in connection with Conexant's efforts to
assist Washington in obtaining new license agreements or transferring a portion
of existing Conexant License Agreements


                                       22
<PAGE>
pursuant to Section 5.04, including the portion of any pre-paid license,
maintenance or other fees allocable to the Washington Business in respect of any
existing Conexant License Agreement being transferred in part.

                  "Washington Outstanding Checks" shall have the meaning set
forth in Section 2.04(c)(i).

                  "Washington Real Property" means the Real Property set forth
on Schedule 1.01(k).

                  "Washington Spin-Off" shall have the meaning set forth in
Section 5.03(a)(iii).

                  "Washington Subsidiary" means each Person listed on Schedule
1.01(l).

                                   ARTICLE II

                                THE CONTRIBUTION


                  Section 2.01 Intercorporate Reorganization. (a) Prior to the
Time of Distribution, Conexant and Washington will take all actions necessary to
increase the outstanding shares of Washington Common Stock so that, immediately
prior to the Distribution, Conexant will hold a number of shares of Washington
Common Stock equal to the aggregate number of (i) shares of Conexant Common
Stock and Conexant Series B Preferred Stock (excluding treasury shares held by
Conexant) issued and outstanding as of the Record Date, (ii) Philsar
Exchangeable Shares (excluding shares held by Conexant or any Conexant
Subsidiary) issued and outstanding as of the Record Date and (iii) the
Performance Plan Shares.

                  (b) Subject to Section 2.08, prior to the Time of
         Distribution:

                  (i) Conexant and each Conexant Subsidiary shall convey, assign
         and transfer, or cause to be conveyed, assigned and transferred, to
         Washington or a Washington Subsidiary, as appropriate, any and all
         right, title and interest of Conexant and each of the Conexant
         Subsidiaries in the Washington Subsidiaries;

                  (ii) Washington and each Washington Subsidiary shall convey,
         assign and transfer, or cause to be conveyed, assigned and transferred,
         to Conexant or a Conexant Subsidiary, as appropriate, any and all
         right, title and interest of Washington and each of the Washington
         Subsidiaries in the Conexant Subsidiaries;

                  (iii) Conexant and each Conexant Subsidiary shall convey,
         assign and transfer, or cause to be conveyed, assigned and transferred,
         to Washington or a Washington Subsidiary, as appropriate, any and all
         right, title and interest of Conexant and each of the Conexant
         Subsidiaries in the Washington Assets;


                                       23
<PAGE>
                  (iv) Washington and each Washington Subsidiary shall convey,
         assign and transfer, or cause to be conveyed, assigned and transferred,
         to Conexant or a Conexant Subsidiary, as appropriate, any and all
         right, title and interest of Washington and each of the Washington
         Subsidiaries in the Conexant Assets;

                  (v) Conexant or a Conexant Subsidiary, as appropriate, shall
         unconditionally assume and undertake to pay, perform and discharge, in
         a timely manner and in accordance with the terms thereof, all Conexant
         Liabilities; and

                  (vi) Washington or a Washington Subsidiary, as appropriate,
         shall unconditionally assume and undertake to pay, perform and
         discharge, in a timely manner and in accordance with the terms thereof,
         all Washington Liabilities.

                  In the event that at any time or from time to time (whether
prior to, at or after the Time of Distribution) any member of the Conexant Group
shall receive or otherwise possess any Washington Asset or interest in a
Washington Subsidiary, such member will promptly convey, assign and transfer, or
cause to be conveyed, assigned and transferred, such Washington Asset or
interest in a Washington Subsidiary to Washington. In the event that at any time
or from time to time (whether prior to, at or after the Time of Distribution)
any member of the Washington Group shall receive or otherwise possess any
Conexant Asset or interest in a Conexant Subsidiary, such member will promptly
convey, assign and transfer, or cause to be conveyed, assigned and transferred,
such Conexant Asset or interest in a Conexant Subsidiary to Conexant. Prior to
any such transfer, the Person receiving or possessing such Asset or interest in
a Subsidiary will hold such Asset or interest in a Subsidiary in trust for the
benefit of the Person entitled thereto (at the expense of the Person entitled
thereto).

                  Without limiting the foregoing, in the event that after the
Time of Distribution (x) Conexant or any Conexant Subsidiary possesses product
intellectual property, human resources or other data bases that are comprised in
whole or in part of Information that constitutes Washington Assets, Conexant
will, and will cause each Conexant Subsidiary to, afford Washington and its
Representatives (at Washington's expense) reasonable access, during normal
business hours and upon reasonable advance notice, to the portion of such data
bases containing Information that constitutes Washington Assets in order to
retrieve such Information and effect the transfer of such Information to
Washington and (y) Washington or any Washington Subsidiary possesses product
intellectual property, human resources or other data bases that are comprised in
whole or in part of Information that constitutes Conexant Assets, Washington
will, and will cause each Washington Subsidiary to, afford Conexant and its
Representatives (at Conexant's expense) reasonable access, during normal
business hours and upon reasonable advance notice, to the portion of such data
bases containing Information that constitutes Conexant Assets in order to
retrieve such Information and effect the transfer of such Information to
Conexant.

                  In the event that at any time or from time to time (whether
prior to, at or after the Time of Distribution) either Conexant or Washington
determines that the other party (or any member of such other party's respective
Group) shall not have unconditionally assumed any Liabilities that are allocated
to such other party (or a member of such other party's


                                       24
<PAGE>
respective Group) pursuant to this Agreement or any Ancillary Agreement, such
other party will promptly execute and deliver, or cause to be executed and
delivered, all such documents and instruments and will take, or cause to be
taken, all such actions as the requesting party may reasonably request to
unconditionally assume, or cause to be unconditionally assumed, such
Liabilities.

                  Solely for purposes of implementing the terms of this
Agreement, during the period beginning on the date of this Agreement and ending
six months after the Distribution Date, Conexant and Alpha agree to discuss the
allocation of any Asset or Liability of Conexant and its Subsidiaries (including
members of the Washington Group) that either of them reasonably believes should
be or should have been allocated differently than pursuant to the terms of this
Agreement (an "Asset/Liability Allocation Matter"). The Conexant Chief Executive
Officer will designate an employee of the Conexant Business and the Alpha Chief
Executive Officer will designate an employee of Alpha who will discuss an
appropriate resolution of any Asset/Liability Allocation Matter. If within
thirty days of the receipt of the notification of an Asset/Liability Allocation
Matter by either Conexant or Alpha pursuant to this paragraph, or such other
time as Conexant and Alpha may agree, the designees have not reached a mutually
acceptable resolution of the Asset/Liability Allocation Matter, the matter will
be referred for discussion to the Conexant Chief Executive Officer and the Alpha
Chief Executive Officer. Should a mutually acceptable resolution of the
Asset/Liability Allocation Matter not be reached within thirty days following
the referral to them, the terms and conditions of this Agreement shall remain in
full force and effect, unamended, unmodified and unsupplemented. Notwithstanding
the foregoing, in no event shall the terms and conditions of this Agreement be
amended, modified or supplemented other than in accordance with the provisions
of Section 7.06. Nothing in this paragraph shall affect the right of any party
to resort to the dispute resolution provisions of Section 7.05 in respect of any
dispute, claim or controversy arising out of an alleged breach of any provision
of this Agreement.

                  (c) In connection with the transfers of Subsidiaries and
Assets and the assumptions of Liabilities contemplated by Section 2.01(b),
Conexant and Washington will execute or cause to be executed by the appropriate
entities the Conveyance and Assumption Instruments in a form reasonably
acceptable to Conexant, Washington and Alpha. The transfer of capital stock
contemplated by Section 2.01(b) will be effected, prior to the Time of
Distribution, by means of delivery of stock certificates duly endorsed or
accompanied by duly executed stock powers and notation on the stock record books
of the corporation or other legal entities involved and, to the extent required
by applicable law, by notation on appropriate registries.

                  (d) (i) Conexant hereby represents and warrants to Washington
that after giving effect to the Contribution and the Distribution (but not
considering any assets or rights held by Alpha or its Subsidiaries prior to the
Effective Time and after taking into account any services to be provided to
Alpha pursuant to the Transition Agreement, except for the matters set forth on
Schedule 2.01(d), immediately after the Time of Distribution, the assets and
rights held by the Washington Group will constitute all of the material assets
and rights of Conexant and its Subsidiaries (including members of the Washington
Group) immediately prior to the Time of Distribution that are necessary to
conduct the Washington Business substantially as


                                       25
<PAGE>
conducted on December 16, 2001. The representation and warranty of Conexant set
forth in this Section 2.01(d)(i) will survive the execution and delivery of this
Agreement and the Distribution Date and will continue in full force and effect
solely for purposes of Section 4.02(d) until six months after the Distribution
Date and shall then terminate and expire.

                  (ii) Within five Business Days (as defined in the Merger
Agreement) after the date of the initial filing of the Form S-4 with the SEC (as
defined in the Merger Agreement), Conexant will cause to be delivered to Alpha
the Audited Balance Sheet with the report of Deloitte & Touche LLP thereon.
Conexant will provide Alpha with reasonable access to the relevant work papers
used to prepare the Audited Balance Sheet and will consider in good faith any
comments of Alpha thereon delivered to Conexant within 10 days after receipt of
the Audited Balance Sheet. Within 20 days after Deloitte & Touche LLP has
delivered its report on the Audited Balance Sheet, Conexant will prepare and
deliver to Alpha the Special Purpose Statement of Tangible Net Assets. Conexant
will provide Alpha with reasonable access to the relevant work papers used to
prepare the Special Purpose Statement of Tangible Net Assets and will consider
in good faith any comments of Alpha thereon delivered to Conexant within 10 days
after receipt of the Special Purpose Statement of Tangible Net Assets. If and to
the extent the total value of the tangible net assets set forth on the Unaudited
Special Purpose Statement of Tangible Net Assets exceeds the total value of the
tangible net assets set forth on the Special Purpose Statement of Tangible Net
Assets (a "Net Asset Deficiency"), notwithstanding anything to the contrary set
forth in this Agreement, Conexant will cause either (A) the Washington Assets to
include such additional Assets (which shall be Cash, like kind Assets other than
Cash that are usable in the Washington Business and reasonably acceptable to
Alpha, or any combination thereof) as are specified by Conexant to Washington in
writing or (B) the Washington Liabilities to exclude such Liabilities as are
specified by Conexant to Washington in writing and reasonably acceptable to
Alpha (which will be retained by Conexant and constitute Conexant Liabilities),
or any combination of (A) and (B) as Conexant shall elect in its sole
discretion, such that the sum of (x) the value of such Assets, if any, plus (y)
the value of such Liabilities (expressed as a positive number), if any, shall
equal the excess, if any, of the Net Asset Deficiency over One Million dollars
($1,000,000).

                  (iii) Each of Conexant (on behalf of itself and each other
member of the Conexant Group) and Washington (on behalf of itself and each other
member of the Washington Group) understands and agrees that, except as expressly
set forth in any Transaction Agreement, no party to any Transaction Agreement or
any other agreement or document contemplated by any Transaction Agreement either
has or is, in such agreement or otherwise, representing or warranting in any way
as to the Assets, Subsidiaries, businesses or Liabilities retained, conveyed,
assigned, transferred or assumed as contemplated thereby, as to any consents or
approvals required in connection with the transactions contemplated by the
Transaction Agreements, as to the value or freedom from any Lien of, or any
other matter concerning, any Assets, Liabilities or Subsidiaries of such party,
or as to the absence of any defenses or rights of setoff or freedom from
counterclaim with respect to any claim or other Assets or Subsidiaries of any
party, or as to the legal sufficiency of any assignment, document or instrument
delivered thereunder to convey title to any Asset or Subsidiary or thing of
value


                                       26
<PAGE>
upon the execution, delivery or filing thereof. Except as may expressly be
set forth in any Transaction Agreement, all Assets and Subsidiaries being
transferred or retained as contemplated by any Transaction Agreement or any
other agreement or document contemplated by any Transaction Agreement are being
transferred, or are being retained, on an "as is", "where is" basis (and, in the
case of the transfer of any real property, by means of a quitclaim or similar
form deed or conveyance) and the respective transferees shall bear the economic
and legal risks that any conveyance shall prove to be insufficient or that the
title to any Asset or Subsidiary shall be other than good and marketable and
free and clear of any Lien.

                  (e) It is the intention of the parties that payments made by
the parties to each other after the Time of Distribution pursuant to this
Agreement, the Employee Matters Agreement or the Tax Allocation Agreement are to
be treated as relating back to the transactions occurring prior to the Time of
Distribution pursuant to this Section 2.01 as an adjustment to the transfers of
Assets, Subsidiaries and Liabilities contemplated by this Section 2.01, and
Conexant and Washington will, and will cause the Conexant Subsidiaries and the
Washington Subsidiaries, respectively, to, take positions consistent with such
intention with any Tax authority, unless with respect to any payment any party
receives an opinion of counsel reasonably acceptable to the other party to the
effect that there is no substantial authority for such a position.

                  Section 2.02 Financial Instruments. (a) (i) Washington will,
at its expense, take or cause to be taken all actions, and enter into (or cause
the Washington Subsidiaries to enter into) such agreements and arrangements, as
shall be necessary to effect the release of and substitution for each member of
the Conexant Group, as of the Time of Distribution, from all primary, secondary,
contingent, joint, several and other Liabilities in respect of Washington
Financial Instruments (it being understood that all Liabilities in respect of
Washington Financial Instruments are Washington Liabilities).

                  (ii) Washington's obligations under this Section 2.02(a) will
continue to be applicable to all Washington Financial Instruments after the Time
of Distribution.

                  (b) (i) Conexant will, at its expense, take or cause to be
taken all actions, and enter into (or cause the Conexant Subsidiaries to enter
into) such agreements and arrangements, as shall be necessary to effect the
release of and substitution for each member of the Washington Group, as of the
Time of Distribution, from all primary, secondary, contingent, joint, several
and other Liabilities in respect of Conexant Financial Instruments (it being
understood that all Liabilities in respect of Conexant Financial Instruments are
Conexant Liabilities).

                  (ii) Conexant's obligations under this Section 2.02(b) will
continue to be applicable to all Conexant Financial Instruments after the Time
of Distribution.


                                       27
<PAGE>
                  Section 2.03 Intercompany Accounts and Arrangements.

                  (a) Elimination of Intercompany Accounts.

                  (i) Except as set forth in Section 2.03(a)(ii) or on Schedule
         2.03(a), Conexant, on behalf of itself and each other member of the
         Conexant Group, on the one hand, and Washington, on behalf of itself
         and each other member of the Washington Group, on the other hand,
         hereby settle and eliminate, by cancellation or transfer to a member of
         the other Group (whether to cancel or transfer and the manner thereof
         will be determined by Conexant), effective as of the Time of
         Distribution, all intercompany receivables, payables and other balances
         existing immediately prior to the Time of Distribution between Conexant
         and/or any Conexant Subsidiary, on the one hand, and Washington and/or
         any Washington Subsidiary, on the other hand.

                  (ii) The provisions of Section 2.03(a)(i) will not apply to
         any intercompany receivables, payables and other balances arising under
         any Transaction Agreement, including those incurred in connection with
         the payment by any party of any expenses which are required to be paid
         or reimbursed by the other party pursuant to Section 4.09.

                  Section 2.04 Cash Management.

                  (a) Cash Management Operations.

                  (i) Effective as of the Time of Distribution, the cash
         management operations of the Washington Group will be segregated from
         the cash management operations of the Conexant Group (other than with
         respect to the Washington Bank Accounts in China and Mauritius which
         will be segregated as of the applicable Local Closing Time).

                  (ii) Washington will, and will cause the Washington
         Subsidiaries to, forward to Conexant (for the account of Conexant or
         the applicable Conexant Subsidiary) any customer payments in respect of
         Accounts Receivable to the extent they constitute Conexant Assets
         received by Washington or any of the Washington Subsidiaries after the
         Time of Distribution, whether received in lock boxes, via wire transfer
         or otherwise, by the first Business Day of the week after the week
         during which such payment is received. Such amounts will be forwarded
         by wire transfer (to Conexant's bank account at Bank One, N.A., Account
         No. 51-52283, A.B.A. Routing Number 071000013) in the case of customer
         payments received within sixty days after the Distribution Date and by
         check sent by reputable overnight courier service to Conexant in the
         case of customer payments received thereafter.

                  (b) Certain Payments after the Distribution Date.

                  Washington will pay to Conexant (by wire transfer to
Conexant's bank account at Bank One, N.A., Account No. 51-52283, A.B.A. Routing
Number 071000013), within three Business Days after the Distribution Date (1)
the dollar value as of the Distribution Date


                                       28
<PAGE>
of the prepaid lease payments made by Conexant with respect to property occupied
by Conexant Systems Korea Ltd. (referred to as the "Korea prepaid rent" under
Item 4 - Balance Sheet Assets on Schedule 1.01(f)), (2) the Recorded Amount
(except that the Recorded Amount in respect of the Washington Bank Accounts in
China and Mauritius shall be paid to Conexant within three Business Days after
the date such accounts are actually transferred to Washington), (3) the amount
of all balances contained immediately prior to the Time of Distribution in petty
cash accounts at locations of the Washington Business, (4) the dollar value of
travelers checks immediately prior to the Time of Distribution at locations of
the Washington Business, (4) the dollar value of all other cash immediately
prior to the Time of Distribution at locations of the Washington Business, (6)
the Printing Expenses set forth on Schedule 4.09 (if and to the extent
previously paid) and (7) the Capital Expenditures and the Washington License
Fees set forth on Schedule 2.04.

                  (c) Funding of Outstanding Checks.

         (i) Washington or a Washington Subsidiary will fund all amounts in
         respect of all checks that are presented for payment at or after the
         applicable Local Closing Time in each of the Washington Bank Accounts
         (other than Washington Bank Accounts in China and Mauritius) and that
         were outstanding immediately prior to the applicable Local Closing Time
         ("Washington Outstanding Checks"). Within ten Business Days after
         Washington's request for reimbursement and presentation of the
         supporting documentation required by this Section 2.04(c)(i) reasonably
         satisfactory to Conexant, Conexant will reimburse Washington (by wire
         transfer to an account specified by Washington to Conexant) for all
         such amounts funded by Washington or a Washington Subsidiary in respect
         of such Washington Outstanding Checks that (x) were written in
         connection with a legitimate business purpose of the Washington
         Business and in the ordinary course of business prior to the applicable
         Local Closing Time and were not payments for Washington Expenses or (y)
         relate to Conexant Assets, Conexant Liabilities (including, without
         limitation, accounts payable accrued in the accounts payable account on
         the books of Conexant and its Subsidiaries (including members of the
         Washington Group) immediately prior to the Time of Distribution) or
         Conexant Expenses. In connection with any request for reimbursement for
         Washington Outstanding Checks pursuant to this Section 2.04(c)(i),
         Washington shall present Conexant with (A) copies of the cancelled
         Washington Outstanding Checks, together with copies of supporting
         invoices, and (B) with respect to Washington Outstanding Checks
         described in clause (x) of the immediately preceding sentence, a
         written representation that (1) the Washington Outstanding Checks were
         written in connection with a legitimate business purpose of the
         Washington Business and in the ordinary course of business prior to the
         applicable Local Closing Time and (2) the payment was not for a
         Washington Expense.

                  (ii) Conexant or a Conexant Subsidiary will fund all amounts
         in respect of all checks that are related to the Washington Business or
         the Washington Liabilities that are presented for payment prior to the
         applicable Local Closing Time in the Washington Bank Accounts in China
         and Mauritius and that were written between the Time of Distribution
         and such applicable Local Closing Time ("China/Mauritius


                                       29
<PAGE>
         Outstanding Checks"). Within ten Business Days after Conexant's request
         for reimbursement and presentation of the supporting documentation
         required pursuant to this Section 2.04(c)(ii) reasonably satisfactory
         to Washington, Washington will reimburse Conexant (by wire transfer to
         the Conexant bank account specified in Section 2.04(b)) for all such
         amounts funded by Conexant or a Conexant Subsidiary in respect of such
         China/Mauritius Outstanding Checks. In connection with any request for
         reimbursement for China/Mauritius Outstanding Checks pursuant to this
         Section 2.04(c)(ii), Conexant shall present Washington with copies of
         the cancelled China/Mauritius Outstanding Checks, together with copies
         of supporting invoices. Washington or a Washington Subsidiary will fund
         (without any right to reimbursement) all amounts in respect of checks
         that are presented for payment at or after the applicable Local Closing
         Time in each of the Washington Bank Accounts in China and Mauritius.

                  (iii) Conexant or a Conexant Subsidiary will fund (without any
         right to reimbursement) all amounts in respect of checks relating to
         the Washington Business or the Washington Liabilities that are
         outstanding immediately prior to the Time of Distribution and presented
         for payment at or after the Time of Distribution in Conexant Bank
         Accounts; and

                  (iv) No checks or electronic fund transfers relating to the
         Washington Business or the Washington Liabilities will be issued on any
         Conexant Bank Accounts at or after the Time of Distribution.

                  Section 2.05 The Washington Board. Prior to the Time of
Distribution, Washington and Conexant will take all actions which may be
required to elect or otherwise appoint as directors of Washington the persons
named on Schedule 2.05 to constitute the board of directors of Washington at the
Time of Distribution.

                  Section 2.06 Resignations; Transfer of Stock Held as Nominee.
(a) Conexant will cause all of its employees and directors and all of the
employees and directors of each other member of the Conexant Group to resign,
effective not later than the Time of Distribution, from all boards of directors
or similar governing bodies of Washington or any other member of the Washington
Group on which they serve, and from all positions as officers of Washington or
any other member of the Washington Group in which they serve, except as
otherwise specified on Schedule 2.06. Washington will cause all of its employees
and directors and all of the employees and directors of each other member of the
Washington Group to resign, effective not later than the Time of Distribution,
from all boards of directors or similar governing bodies of Conexant or any
other member of the Conexant Group on which they serve, and from all positions
as officers of Conexant or any other member of the Conexant Group in which they
serve, except as otherwise specified on Schedule 2.06.

                  (b) Conexant will cause each of its employees, and each of the
employees of the other members of the Conexant Group, who holds stock or similar
evidence of ownership of any Washington Group entity as nominee for such entity
pursuant to the laws of the country in which such entity is located to transfer
such stock or similar evidence of


                                       30
<PAGE>
ownership to the Person so designated by Washington to be such nominee as of and
after the Time of Distribution. Washington will cause each of its employees, and
each of the employees of the other members of the Washington Group, who holds
stock or similar evidence of ownership of any Conexant Group entity as nominee
for such entity pursuant to the laws of the country in which such entity is
located to transfer such stock or similar evidence of ownership to the Person so
designated by Conexant to be such nominee as of and after the Time of
Distribution.

                  (c) Conexant will cause each of its employees and each of the
employees of the other members of the Conexant Group to revoke or withdraw their
express written authority, if any, to act on behalf of any Washington Group
entity as an agent or representative therefor after the Time of Distribution.
Washington will cause each of its employees and each of the employees of the
other members of the Washington Group to revoke or withdraw their express
written authority, if any, to act on behalf of any Conexant Group entity as an
agent or representative therefor after the Time of Distribution.

                  Section 2.07 Washington Certificate of Incorporation and
By-laws. Prior to the Time of Distribution, (a) the Washington Board will (i)
approve the Certificate of Incorporation and will cause the same to be filed
with the Secretary of State of the State of Delaware and (ii) adopt the By-laws,
and (b) Conexant, as sole stockholder of Washington, will approve the
Certificate of Incorporation.

                  Section 2.08 Consents. Prior to and after the Time of
Distribution, Conexant and Washington will, and will cause the Conexant
Subsidiaries and the Washington Subsidiaries, respectively, to, use their
commercially reasonable efforts (as requested by the other party) to obtain, or
to cause to be obtained, all Consents necessary for the transfer of all Assets,
Subsidiaries and Liabilities contemplated to be transferred pursuant to this
Article II; provided, however, that none of Conexant (or any of the Conexant
Subsidiaries) or Washington (or any of the Washington Subsidiaries) shall be
obligated to pay any consideration or offer or grant any financial accommodation
in connection therewith. Anything contained herein to the contrary
notwithstanding, this Agreement shall not constitute an agreement to assign any
Contract or Permit if an assignment or attempted assignment of the same without
the Consent of any other party or parties thereto or other required Consent
would constitute a breach thereof or of any applicable law or in any way impair
the rights of any member of the Conexant Group or the Washington Group
thereunder. If any such Consent is not obtained or if an attempted assignment
would be ineffective or would impair any rights of either Group under any such
Contract or Permit so that the contemplated assignee hereunder (the "Recipient
Party") would not receive all such rights, then (x) the party contemplated
hereunder to assign such Contract or Permit (the "Assigning Party") will use
commercially reasonable efforts (it being understood that such efforts shall not
include any requirement of the Assigning Party to pay any consideration or offer
or grant any financial accommodation) to provide or cause to be provided to the
Recipient Party the benefits of any such Contract or Permit and the Assigning
Party will promptly pay or cause to be paid to the Recipient Party when received
all moneys and properties received by the Assigning Party with respect to any
such Contract or Permit and (y) to the extent that the Recipient Party receives
the benefits of such Contract or Permit, the Recipient Party will pay,


                                       31
<PAGE>
perform and discharge on behalf of the Assigning Party all of the Assigning
Party's Liabilities thereunder in a timely manner and in accordance with the
terms thereof. If and when such Consents are obtained, the transfer of the
applicable Contract or Permit shall be effected as promptly following the Time
of Distribution as shall be practicable in accordance with the terms of this
Agreement. To the extent that any transfers and assumptions contemplated by this
Article II shall not have been consummated on or prior to the Time of
Distribution, the parties shall cooperate to effect such transfers as promptly
following the Time of Distribution as shall be practicable. Notwithstanding that
any transfer of Washington Assets, including the Washington Real Property, to a
member of the Washington Group contemplated by this Article II shall not have
been consummated on or prior to the Time of Distribution, the Washington Group
shall bear the risk of any Liability with respect to the Washington Assets,
including the Washington Real Property (including any risk of loss thereof),
from and after the Time of Distribution; provided, however, that the Washington
Group shall only bear the Liability with respect to any such Washington Asset if
and to the extent that the Washington Group enjoys the benefit of such
Washington Asset.

                                   ARTICLE III

                                THE DISTRIBUTION


                  Section 3.01 The Distribution. (a) Subject to Section 3.03,
the Conexant Board will establish the Record Date and the Distribution Date and
authorize Conexant to pay the Distribution immediately prior to the Effective
Time by delivery to the Distribution Agent, for the benefit of holders of record
of Conexant Common Stock and Conexant Series B Preferred Stock (excluding
treasury shares held by Conexant) as of the Record Date, of a number of shares
of Washington Common Stock equal to the aggregate number of shares of Conexant
Common Stock and Conexant Series B Preferred Stock (excluding treasury shares
held by Conexant) issued and outstanding as of the Record Date, and Conexant
will instruct the Distribution Agent to make book-entry credits on the
Distribution Date or as soon thereafter as practicable in the name of each
holder of record of Conexant Common Stock and Conexant Series B Preferred Stock
(excluding treasury shares held by Conexant) as of the Record Date for a number
of shares of Washington Common Stock equal to the number of shares of Conexant
Common Stock or Conexant Series B Preferred Stock so held by such holder of
record as of the Record Date. The Distribution will be deemed to be effective as
of the Time of Distribution upon written authorization from Conexant to the
Distribution Agent to proceed as set forth in this Section 3.01(a).

                  (b) In addition, Conexant will instruct the Distribution Agent
to make book-entry credits on the Distribution Date or as soon thereafter as
practicable in the name of (i) each holder of record of Philsar Exchangeable
Shares (excluding shares held by Conexant or any Conexant Subsidiary) as of the
Record Date for a number of shares of Washington Common Stock equal to the
number of shares of Philsar Exchangeable Shares so held by such holder of record
as of the Record Date and (ii) Conexant for the Performance Plan Shares.


                                       32
<PAGE>
                  (c) Immediately after the Time of Distribution and prior to
the Effective Time, the shares of Washington Common Stock shall not be
transferable and the transfer agent for the Washington Common Stock shall not
transfer any shares of Washington Common Stock, except that the Distribution
Agent, on behalf of the holders of Washington Common Stock, may exchange such
shares for shares of Alpha Common Stock as provided by Section 3.2 of the Merger
Agreement in connection with the Merger.

                  (d) Conexant and Washington each will provide to the
Distribution Agent all information (including information necessary to make
appropriate book-entry credits) and share certificates, in each case, as may be
required in order to (i) complete the Distribution on the basis of one share of
Washington Common Stock for each share of Conexant Common Stock and Conexant
Series B Preferred Stock (excluding treasury shares held by Conexant), (ii)
record the holders of Philsar Exchangeable Shares (excluding shares held by
Conexant or any Conexant Subsidiary) issued and outstanding as of the Record
Date as holders of one share of Washington Common Stock for each Philsar
Exchangeable Share and (iii) record Conexant as the holder of the Performance
Plan Shares.

                  Section 3.02 Cooperation Prior to the Distribution. Prior to
the Distribution:

                  (a) Conexant and Washington will prepare the Information
Statement which will include appropriate disclosure concerning Washington, its
business, operations and management, the Contribution, the Distribution and such
other matters as Conexant and Washington may determine and as may be required by
law. Conexant will mail to the holders of Conexant Common Stock and the Conexant
Series B Preferred Stock the Information Statement prior to the Distribution.

                  (b) Conexant and Washington will take all such action as may
be necessary or appropriate under the securities or "blue sky" laws of the
states or other political subdivisions of the United States and the securities
laws of any applicable foreign countries or other political subdivisions thereof
in connection with the transactions contemplated by this Agreement.

                  Section 3.03 Conditions to the Distribution. In no event will
the Distribution occur prior to such time as each of the following conditions
shall have been satisfied or shall have been waived by the Conexant Board:

                  (a) the Conexant Board shall be reasonably satisfied that,
         after giving effect to the Contribution, (i) Conexant will not be
         insolvent and will not have unreasonably small capital with which to
         engage in its businesses and (ii) Conexant's surplus would be
         sufficient to permit, without violation of Section 170 of the Delaware
         General Corporation Law, the Distribution;

                  (b) no order, ruling, injunction or decree issued by any court
         of competent jurisdiction or other Governmental Entity or other legal
         restraint or prohibition preventing consummation of the Contribution or
         the Distribution shall be in effect;


                                       33
<PAGE>
                  (c) no suit, action or proceeding by or before any court of
         competent jurisdiction or other Governmental Entity shall have been
         commenced and be pending to restrain or challenge the Contribution or
         the Distribution; and

                  (d) each condition to the closing of the Merger Agreement set
         forth in Article VIII thereof, other than the condition set forth in
         Section 8.1(i) thereof as to the consummation of the Contribution and
         the Distribution, shall have been fulfilled or waived by the party for
         whose benefit such condition exists.

                  Subject to the terms and conditions of this Agreement, each
party will use its reasonable best efforts to cause the conditions set forth in
this Section 3.03 to be satisfied as promptly as reasonably practicable;
provided that no party will be required to waive any condition.

                  Section 3.04 Waiver of Conditions. Any or all of the
conditions set forth in Section 3.03 may be waived, in whole or in part, in the
sole discretion of the Conexant Board. The conditions set forth in Section 3.03
are for the sole benefit of Conexant and shall not give rise to or create any
duty on the part of Conexant or the Conexant Board to waive or not waive any
such conditions.

                  Section 3.05 Disclosure. If at any time after December 16,
2001 either of the parties shall become aware of any circumstances that will or
could reasonably be expected to prevent any or all of the conditions contained
in Section 3.03 from being satisfied, it will promptly give to the other party
written notice of those circumstances.

                                   ARTICLE IV

                    MUTUAL RELEASE; INDEMNIFICATION; EXPENSES


                  Section 4.01 Mutual Release. Effective as of the Time of
Distribution and except as otherwise specifically set forth in the Transaction
Agreements, each of Conexant, on behalf of itself and each of the Conexant
Subsidiaries, on the one hand, and Washington, on behalf of itself and each of
the Washington Subsidiaries, on the other hand, hereby releases and forever
discharges the other party and its Subsidiaries, and its and their respective
officers, directors, agents, record and beneficial security holders (including
trustees and beneficiaries of trusts holding such securities), advisors and
Representatives (in each case, in their respective capacities as such) and their
respective heirs, executors, administrators, successors and assigns, of and from
all debts, demands, actions, causes of action, suits, accounts, covenants,
contracts, agreements, damages, claims and Liabilities whatsoever of every name
and nature, both in law and in equity, which the releasing party has or ever had
or ever will have, which arise out of or relate to events, circumstances or
actions taken by such other party occurring or failing to occur or any
conditions existing at or prior to the Time of Distribution; provided, however,
that the foregoing general release shall not apply to (i) any Liabilities or
other obligations (including Liabilities with respect to payment, reimbursement,
indemnification or contribution) under the Transaction Agreements or assumed,
transferred,


                                       34
<PAGE>
assigned, allocated or arising under any of the Transaction Agreements
(including any Liability that the parties may have with respect to payment,
performance, reimbursement, indemnification or contribution pursuant to any
Transaction Agreement for claims brought against the parties by third Persons or
any Indemnitee), and the foregoing release will not affect any party's right to
enforce the Transaction Agreements in accordance with their terms or (ii) any
Liability the release of which would result in the release of any Person other
than a Person released pursuant to this Section 4.01 (provided, that the parties
agree not to bring suit or permit any of their Subsidiaries to bring suit
against any member of the other Group with respect to any Liability to the
extent such member of the other Group would be released with respect to such
Liability by this Section 4.01 but for this clause (ii)).

                  Each of Conexant and Washington acknowledges that it has been
advised by its legal counsel and is familiar with the provisions of California
Civil Code Section 1542, which provides as follows:

                  "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
                  CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE
                  TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE
                  MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR."

Being aware of said Code section, each of Conexant, on behalf of itself and the
Conexant Subsidiaries, and Washington, on behalf of itself and the Washington
Subsidiaries, hereby expressly waives any rights it may have under California
Civil Code Section 1542, as well as any other statutes or common law principles
of similar effect.

                  Section 4.02 Indemnification by Conexant. Subject to the
provisions of this Article IV, Conexant shall indemnify, defend and hold
harmless the Washington Indemnitees from and against, and pay or reimburse, as
the case may be, the Washington Indemnitees for, all Indemnifiable Losses, as
incurred, suffered by any Washington Indemnitee to the extent based upon,
arising out of or relating to the following:

                  (a) the Conexant Liabilities (including the failure by
         Conexant or any other member of the Conexant Group to pay, perform or
         otherwise discharge the Conexant Liabilities in accordance with their
         terms), whether such Indemnifiable Losses are based upon, arise out of
         or relate to events, occurrences, actions, omissions, facts,
         circumstances or conditions occurring, existing or asserted before, at
         or after the Time of Distribution;

                  (b) the breach by any member of the Conexant Group of any
         agreement or covenant contained in a Transaction Agreement which does
         not by its express terms expire at the Time of Distribution;

                  (c) the use by members of the Conexant Group or their
         respective sublicensees of any intellectual property licensed by
         Washington and the Washington


                                       35
<PAGE>
         Subsidiaries pursuant to Section 5.03 other than in accordance with the
         terms of such provision;

                  (d) the breach of the representation and warranty of Conexant
         contained in Section 2.01(d)(i); or

                  (e) the enforcement by the Washington Indemnitees of their
         rights to be indemnified, defended and held harmless under this Section
         4.02.

Notwithstanding anything to the contrary contained herein, in the event it is
determined that Conexant shall have breached its representation and warranty
contained in Section 2.01(d)(i), Conexant shall have the right, in its sole
discretion, to transfer any Asset to Washington necessary to cure such breach,
in which event Conexant's indemnification obligation in respect of such breach
shall be satisfied in full, except with respect to any Indemnifiable Losses
arising from such breach during the period from the Time of Distribution to the
time of such transfer.

                  Section 4.03 Indemnification by Washington. Subject to the
provisions of this Article IV, Washington shall indemnify, defend and hold
harmless the Conexant Indemnitees from and against, and pay or reimburse, as the
case may be, the Conexant Indemnitees for, all Indemnifiable Losses, as
incurred, suffered by any Conexant Indemnitee to the extent based upon, arising
out of or relating to the following:

                  (a) the Washington Liabilities (including the failure by
         Washington or any other member of the Washington Group to pay, perform
         or otherwise discharge the Washington Liabilities in accordance with
         their terms), whether such Indemnifiable Losses are based upon, arise
         out of or relate to events, occurrences, actions, omissions, facts,
         circumstances or conditions occurring, existing or asserted before, at
         or after the Time of Distribution;

                  (b) the breach by any member of the Washington Group of any
         agreement or covenant contained in a Transaction Agreement which does
         not by its express terms expire at the Time of Distribution;

                  (c) the use by members of the Washington Group (or, in the
         case of intellectual property licensed by Conexant and the Conexant
         Subsidiaries pursuant to Section 5.03, members of the Washington Group
         or their respective sublicensees) of any names, trademarks, trade
         names, domain names, service marks or corporate symbols or logos
         pursuant to Section 5.02 or intellectual property licensed by Conexant
         and the Conexant Subsidiaries pursuant to Section 5.03 other than in
         accordance with the terms of such provisions; or

                  (d) the enforcement by the Conexant Indemnitees of their
         rights to be indemnified, defended and held harmless under this Section
         4.03.

                  Section 4.04 Limitations on Indemnification Obligations. (a)
The amount which any party (an "Indemnifying Party") is or may be required to
pay to an Indemnitee in


                                       36
<PAGE>
respect of Indemnifiable Losses or other Liability for which indemnification is
provided under this Agreement shall be reduced by any amounts actually received
(including Insurance Proceeds actually received) by or on behalf of such
Indemnitee (net of increased insurance premiums and charges to the extent
related to Indemnifiable Losses and costs and expenses (including reasonable
legal fees and expenses) incurred by such Indemnitee in connection with seeking
to collect and collecting such amounts) in respect of such Indemnifiable Losses
or other Liability (such net amounts are referred to herein as "Indemnity
Reduction Amounts"). If any Indemnitee receives any Indemnity Reduction Amounts
in respect of an Indemnifiable Loss for which indemnification is provided under
this Agreement after the full amount of such Indemnifiable Loss has been paid by
an Indemnifying Party or after an Indemnifying Party has made a partial payment
of such Indemnifiable Loss and such Indemnity Reduction Amounts exceed the
remaining unpaid balance of such Indemnifiable Loss, then the Indemnitee shall
promptly remit to the Indemnifying Party an amount equal to the excess (if any)
of (A) the amount theretofore paid by the Indemnifying Party in respect of such
Indemnifiable Loss, less (B) the amount of the indemnity payment that would have
been due if such Indemnity Reduction Amounts in respect thereof had been
received before the indemnity payment was made.

                  (b) In determining the amount of any Indemnifiable Losses,
such amount shall be (i) reduced to take into account any net Tax benefit
realized by the Indemnitee arising from the incurrence or payment by the
Indemnitee of such Indemnifiable Losses and (ii) increased to take into account
any net Tax cost incurred by the Indemnitee as a result of the receipt or
accrual of payments hereunder (grossed-up for such increase), in each case
determined by treating the Indemnitee as recognizing all other items of income,
gain, loss, deduction or credit before recognizing any item arising from such
Indemnifiable Losses. In determining the amount of any such Tax benefit or Tax
cost, the Washington Indemnitees or the California Indemnitees, as applicable,
shall be deemed to be subject to Tax as follows: (A) U.S. federal income Taxes
and foreign income Taxes at the maximum statutory rate then in effect and (B)
U.S. state and local income Taxes at an assumed rate of five percent net of U.S.
federal income Tax benefits. It is the intention of the parties to this
Agreement that indemnity payments made pursuant to this Agreement are to be
treated as relating back to the Distribution as an adjustment to capital (i.e.,
capital contribution or distribution), and the parties shall not take any
position inconsistent with such intention before any Tax Authority (as defined
in the Tax Allocation Agreement), except to the extent that a final
determination (as defined in Section 1313 of the Code) with respect to the
recipient party causes any such payment not to be so treated.

                  (c) No monetary amount will be payable by Conexant to any
Washington Indemnitee with respect to the indemnification of any claims pursuant
to Section 4.02(d) until the aggregate amount of Indemnifiable Losses actually
incurred by the Washington Indemnitees with respect to such claims shall exceed
on a cumulative basis an amount equal to One Million Five Hundred Thousand
dollars ($1,500,000), in which event Conexant shall be responsible only for the
amount of such Indemnifiable Losses in excess of One Million Five Hundred
Thousand dollars ($1,500,000).


                                       37
<PAGE>
                  (d) No monetary amount will be payable by Conexant to any
Washington Indemnitee with respect to the indemnification of any claims pursuant
to Section 4.02(d) after the aggregate amount of Indemnifiable Losses actually
paid by Conexant with respect to such claims shall equal on a cumulative basis
an amount equal to Fifteen Million dollars ($15,000,000).

                  Section 4.05 Procedures Relating to Indemnification. (a) If a
claim or demand is made against an Indemnitee, or an Indemnitee shall otherwise
learn of an assertion, by any Person who is not a party to this Agreement (or an
Affiliate thereof) as to which an Indemnifying Party may be obligated to provide
indemnification pursuant to this Agreement (a "Third Party Claim"), such
Indemnitee will notify the Indemnifying Party in writing, and in reasonable
detail, of the Third Party Claim reasonably promptly after becoming aware of
such Third Party Claim; provided, however, that failure to give such
notification will not affect the indemnification provided hereunder except to
the extent the Indemnifying Party shall have been actually prejudiced as a
result of such failure. Thereafter, the Indemnitee will deliver to the
Indemnifying Party, promptly after the Indemnitee's receipt thereof, copies of
all material notices and documents (including court papers) received or
transmitted by the Indemnitee relating to the Third Party Claim.

                  (b) If a Third Party Claim is made against an Indemnitee, the
Indemnifying Party will be entitled to participate in or to assume the defense
thereof (in either case, at the expense of the Indemnifying Party) with counsel
selected by the Indemnifying Party and reasonably satisfactory to the
Indemnitee. Should the Indemnifying Party so elect to assume the defense of a
Third Party Claim, the Indemnifying Party will not be liable to the Indemnitee
for any legal or other expenses subsequently incurred by the Indemnitee in
connection with the defense thereof; provided, that if in the Indemnitee's
reasonable judgment a conflict of interest exists in respect of such claim or if
the Indemnifying Party shall have assumed responsibility for such claim with any
reservations or exceptions, such Indemnitee will have the right to employ
separate counsel reasonably satisfactory to the Indemnifying Party to represent
such Indemnitee and in that event the reasonable fees and expenses of such
separate counsel (but not more than one separate counsel for all Indemnitees
similarly situated) shall be paid by such Indemnifying Party. If the
Indemnifying Party assumes the defense of any Third Party Claim, the Indemnitee
will have the right to participate in the defense thereof and to employ counsel,
at its own expense, separate from the counsel employed by the Indemnifying
Party, it being understood that the Indemnifying Party will control such
defense. The Indemnifying Party will be liable for the fees and expenses of
counsel employed by the Indemnitee for any period during which the Indemnifying
Party has failed to assume the defense thereof. If the Indemnifying Party
assumes the defense of any Third Party Claim, the Indemnifying Party will
promptly supply to the Indemnitee copies of all material correspondence and
documents relating to or in connection with such Third Party Claim and keep the
Indemnitee fully informed of all material developments relating to or in
connection with such Third Party Claim (including providing to the Indemnitee on
request updates and summaries as to the status thereof). If the Indemnifying
Party chooses to defend a Third Party Claim, the parties hereto will cooperate
in the defense thereof (such cooperation to be at the expense, including
reasonable legal fees and expenses, of the Indemnifying Party), which
cooperation shall include the retention in accordance with this Agreement and
(upon


                                       38
<PAGE>
the Indemnifying Party's request) the provision to the Indemnifying Party of
records and information which are reasonably relevant to such Third Party Claim,
and making employees available on a mutually convenient basis to provide
additional information and explanation of any material provided hereunder.

                  (c) No Indemnifying Party will consent to any settlement,
compromise or discharge (including the consent to entry of any judgment) of any
Third Party Claim without the Indemnitee's prior written consent (which consent
will not be unreasonably withheld); provided, that if the Indemnifying Party
assumes the defense of any Third Party Claim, the Indemnitee will agree to any
settlement, compromise or discharge of such Third Party Claim which the
Indemnifying Party may recommend and which by its terms obligates the
Indemnifying Party to pay the full amount of Indemnifiable Losses in connection
with such Third Party Claim and unconditionally and irrevocably releases the
Indemnitee and its Affiliates completely from all Liability in connection with
such Third Party Claim; provided, however, that the Indemnitee may refuse to
agree to any such settlement, compromise or discharge (x) that provides for
injunctive or other nonmonetary relief affecting the Indemnitee or any of its
Affiliates or (y) that, in the reasonable opinion of the Indemnitee, would
otherwise materially adversely affect the Indemnitee or any of its Affiliates.
Whether or not the Indemnifying Party shall have assumed the defense of a Third
Party Claim, the Indemnitee will not (unless required by law) admit any
liability with respect to, or settle, compromise or discharge, such Third Party
Claim without the Indemnifying Party's prior written consent (which consent will
not be unreasonably withheld).

                  (d) Any claim on account of Indemnifiable Losses which does
not involve a Third Party Claim will be asserted by reasonably prompt written
notice given by the Indemnitee to the Indemnifying Party from whom such
indemnification is sought. The failure by any Indemnitee so to notify the
Indemnifying Party will not relieve the Indemnifying Party from any liability
which it may have to such Indemnitee under this Agreement, except to the extent
that the Indemnifying Party shall have been actually prejudiced by such failure.

                  (e) In the event of payment in full by an Indemnifying Party
to any Indemnitee in connection with any Third Party Claim, such Indemnifying
Party will be subrogated to and shall stand in the place of such Indemnitee as
to any events or circumstances in respect of which such Indemnitee may have any
right or claim relating to such Third Party Claim against any claimant or
plaintiff asserting such Third Party Claim or against any other Person. Such
Indemnitee will cooperate with such Indemnifying Party in a reasonable manner,
and at the cost and expense of such Indemnifying Party, in prosecuting any
subrogated right or claim.

                  Section 4.06 Remedies Cumulative. Subject to the provisions of
Section 7.05, the remedies provided in this Article IV shall be cumulative and
shall not preclude assertion by any Indemnitee of any other rights or the
seeking of any and all other remedies against any Indemnifying Party, except
that the indemnity contained in Section 4.02(d) shall be the sole and exclusive
remedy of the parties hereto, their Affiliates, successors and assigns with
respect to any and all claims arising out of or relating to the breach of the
representation and warranty of Conexant contained in Section 2.01(d)(i).


                                       39


<PAGE>

            Section 4.07 Survival of Indemnities. Except as set forth in the
following sentence, the obligations of each of Conexant and Washington under
this Article IV will not terminate at any time and will survive the sale or
other transfer by any party of any assets or businesses or the assignment by any
party of any Liabilities. Notwithstanding anything to the contrary contained
herein, the obligation of Conexant to indemnify, defend and hold harmless the
Washington Indemnitees pursuant to Section 4.02(d) will terminate upon the
expiration of the representation and warranty set forth in Section 2.01(d)(i);
provided, however, that such obligation to indemnify, defend and hold harmless
will not terminate with respect to any individual claim as to which an
Indemnitee shall have, before such expiration of such representation and
warranty, previously delivered a notice (stating in reasonable detail the basis
of such claim) to Conexant.

            Section 4.08 Exclusivity of Tax Allocation Agreement.
Notwithstanding anything in this Agreement to the contrary, the Tax Allocation
Agreement will be the exclusive agreement among the parties with respect to all
Tax matters, including indemnification in respect of Tax matters.

            Section 4.09 Expenses. g) Except as otherwise set forth in any
Transaction Agreement, (i) all Conexant Expenses will be charged to and paid by
Conexant and (ii) all Washington Expenses will be charged to and paid by
Washington.

            (b) Subject to Section 2.04 with respect to the Capital Expenditures
and the Washington License Fees set forth on Schedule 2.04 and the Printing
Expenses, within twenty Business Days after the Distribution Date, Washington
will reimburse Conexant (by wire transfer to Conexant's bank account at Bank
One, N.A., Account No. 51-52283, A.B.A. Routing Number 071000013) for all
amounts in respect of Washington Expenses paid by Conexant or any of its
Subsidiaries (including members of the Washington Group) before or at the Time
of Distribution (including Washington Expenses that would otherwise constitute
accounts payable); provided that, within ten Business Days after the
Distribution Date, Conexant has notified Washington in writing of such
Washington Expenses and provided Washington with appropriate supporting
documentation for such Washington Expenses. Promptly (and in any event within 10
Business Days) after Conexant's request therefor and upon production to
Washington of appropriate supporting documentation, Washington will reimburse
Conexant (by wire transfer to the same bank account referred to in the preceding
sentence) for all Washington Expenses paid by Conexant or any of its
Subsidiaries before, at or after the Time of Distribution (including Washington
Expenses that would otherwise constitute accounts payable), other than as
previously reimbursed by Washington pursuant to the preceding sentence. The
parties acknowledge and agree that the amounts actually incurred by Conexant and
its Subsidiaries (including members of the Washington Group) prior to the Time
of Distribution set forth on Schedule 4.09 and any additional amounts (including
but not limited to those forecast to be incurred that are actually incurred)
included in the categories of such expenses set forth on Schedule 4.09 shall
constitute Washington Expenses that will be reimbursed by Washington pursuant to
this Section 4.09. Notwithstanding anything to the contrary in this Agreement,
Washington shall in no event be obligated to pay, and Conexant shall in no event
be entitled to receive, reimbursement pursuant to this Section 4.09 for any
amount in respect of Washington Expenses for which


                                       40
<PAGE>
payment was made by a Washington Outstanding Check that was not reimbursed by
Conexant pursuant to Section 2.04(c)(i).

            Section 4.10 Effect of Investigation. The right to indemnification
pursuant to Section 4.02(d) shall not be affected by any investigation conducted
with respect to, or any knowledge acquired (or capable of being acquired) at any
time, whether before or after the execution and delivery of this Agreement or
the Distribution Date, with respect to the representation and warranty contained
in Section 2.01(d)(i).


                                    ARTICLE V

                              CERTAIN OTHER MATTERS


            Section 5.01 Insurance.

            (a) Coverage. Subject to the provisions of this Section 5.01,
coverage of Washington and the Washington Subsidiaries under all Policies shall
cease as of the Time of Distribution. From and after the Time of Distribution,
Washington and the Washington Subsidiaries will be responsible for obtaining and
maintaining all insurance coverages in their own right. All Policies will
constitute Conexant Assets and will be retained by Conexant and the Conexant
Subsidiaries, together with all rights, benefits and privileges thereunder
(including the right to receive any and all return premiums with respect
thereto), except that Washington will have the rights in respect of Policies to
the extent described in Section 5.01(b).

            (b) Rights Under Policies. From and after the Time of Distribution,
Washington and the Washington Subsidiaries will have no rights with respect to
any Policies, except that (i) Washington will have the right to assert claims
(and Conexant will use commercially reasonable efforts to assist Washington in
asserting claims) for any loss, liability or damage with respect to the
Washington Assets or Washington Liabilities under Policies with third-party
insurers which are "occurrence basis" insurance policies ("Occurrence Basis
Policies") arising out of insured incidents occurring from the date coverage
thereunder first commenced until the Time of Distribution to the extent that the
terms and conditions of any such Occurrence Basis Policies and agreements
relating thereto so allow and (ii) Washington will have the right to continue to
prosecute claims with respect to Washington Assets or Washington Liabilities
properly asserted with an insurer prior to the Time of Distribution (and
Conexant will use commercially reasonable efforts to assist Washington in
connection therewith) under Policies with third-party insurers which are
insurance policies written on a "claims made" basis ("Claims Made Policies")
arising out of insured incidents occurring from the date coverage thereunder
first commenced until the Time of Distribution to the extent that the terms and
conditions of any such Claims Made Policies and agreements relating thereto so
allow, provided, that in the case of both clauses (i) and (ii) above, (A) all of
Conexant's and each Conexant Subsidiary's reasonable out-of-pocket costs and
expenses incurred in connection with the foregoing are promptly paid by
Washington, (B) Conexant and the Conexant Subsidiaries may, at any time, without
liability or obligation


                                       41
<PAGE>
to Washington or any Washington Subsidiary (other than as set forth in Section
5.01(c)), amend, commute, terminate, buy-out, extinguish liability under or
otherwise modify any Occurrence Basis Policies or Claims Made Policies (and such
claims shall be subject to any such amendments, commutations, terminations,
buy-outs, extinguishments and modifications), (C) such claims will be subject to
(and recovery thereon will be reduced by the amount of) any applicable
deductibles, retentions or self-insurance provisions, (D) such claims will be
subject to (and recovery thereon will be reduced by the amount of) any payment
or reimbursement obligations of Conexant, any Conexant Subsidiary or any
Affiliate of Conexant or any Conexant Subsidiary in respect thereof and (E) such
claims will be subject to exhaustion of existing aggregate limits. Conexant's
obligation to use commercially reasonable efforts to assist Washington in
asserting claims under applicable Policies will include using commercially
reasonable efforts in assisting Washington to establish its right to coverage
under such Policies (so long as all of Conexant's reasonable out-of-pocket costs
and expenses in connection therewith are promptly paid by Washington). None of
Conexant or the Conexant Subsidiaries will bear any Liability for the failure of
an insurer to pay any claim under any Policy. It is understood that any Claims
Made Policies will not provide any coverage to Washington and the Washington
Subsidiaries for incidents occurring prior to the Time of Distribution but which
are asserted with the insurance carrier after the Time of Distribution.

            (c) Conexant Actions. In the event that after the Time of
Distribution Conexant or any Conexant Subsidiary proposes to amend, commute,
terminate, buy-out, extinguish liability under or otherwise modify any Policies
under which Washington has rights to assert claims pursuant to Section 5.01(b)
in a manner that would adversely affect any such rights of Washington, (i)
Conexant will give Washington prior notice thereof and consult with Washington
with respect to such action (it being understood that the decision to take any
such action will be in the sole discretion of Conexant) and (ii) Conexant will
pay to Washington its equitable share (which shall be determined by Conexant in
good faith based on the amount of premiums paid by or allocated to the
Washington Business in respect of the applicable Policy) of any net proceeds
actually received by Conexant from the insurer under the applicable Policy as a
result of such action by Conexant (after deducting Conexant's reasonable costs
and expenses incurred in connection with such action).

            (d) Administration. From and after the Time of Distribution:

            (i) Conexant or a Conexant Subsidiary, as appropriate, will be
      responsible for the Claims Administration with respect to claims of
      Conexant and the Conexant Subsidiaries under Policies; and

            (ii) Washington or a Washington Subsidiary, as appropriate, will be
      responsible for the Claims Administration with respect to claims of
      Washington and the Washington Subsidiaries under Policies.

            (e) Insurance Premiums. From and after the Time of Distribution,
Conexant will pay all premiums (retrospectively-rated or otherwise) as required
under the terms and conditions of the respective Policies in respect of periods
prior to the Time of


                                       42
<PAGE>
Distribution, whereupon Washington will upon the request of Conexant, forthwith
reimburse Conexant for that portion of such premiums paid by Conexant as are
reasonably determined by Conexant to be attributable to the Washington Business.

            (f) Agreement for Waiver of Conflict and Shared Defense. In the
event that a Policy provides coverage for both Conexant and/or a Conexant
Subsidiary, on the one hand, and Washington and/or a Washington Subsidiary, on
the other hand, relating to the same occurrence, Conexant and Washington agree
to defend jointly and to waive any conflict of interest necessary to the conduct
of that joint defense. Nothing in this Section 5.01(f) will be construed to
limit or otherwise alter in any way the indemnity obligations of the parties to
this Agreement, including those created by this Agreement, by operation of law
or otherwise.

            (g) Settlement Claim. Any amounts recovered by Conexant or any of
its Subsidiaries (including members of the Washington Group) under Policies
providing coverage in respect of the Settlement Claim shall be first paid to
Conexant until Conexant has recovered the full amount paid by Conexant to the
customer and thereafter the excess amounts, if any, shall be paid to Washington.

            Section 5.02 Use of Names, Trademarks, etc. (a) From and after the
Time of Distribution, subject to Section 5.02(b), Conexant will own all rights
of Conexant or any of its Subsidiaries (including members of the Washington
Group) in, and to the use of, the Conexant Marks. Prior to or promptly after the
Time of Distribution (but in no event later than 90 days after the Time of
Distribution in the case of United States Persons and 180 days after the Time of
Distribution in the case of non-United States Persons), Washington will change
the name of any Washington Subsidiary or other Person under its control to
eliminate therefrom the names "Conexant", "Conexant Systems" and "Conexant
Systems, Inc." and all derivatives thereof.

            (b) From and after the Time of Distribution, except as permitted in
this Section 5.02(b), the Washington Group will not use or have any rights to
the Conexant Marks or any name, mark or symbol confusingly similar thereto, or
any special script, type font, form, style, logo, design, device, trade dress or
symbol which contains, represents or evokes the Conexant Marks or any name or
mark confusingly similar thereto. From and after the Time of Distribution, the
Washington Group will not hold itself out as having any affiliation with the
Conexant Group. However, Conexant hereby grants to Washington a non-exclusive,
non-transferable (other than by way of sublicenses to members of the Washington
Group) license to utilize without obligation to pay royalties to Conexant the
names, trademarks, trade names and service marks "Conexant", "Conexant Systems"
and "Conexant Systems, Inc." and any corporate symbol or logo related thereto in
connection with stationery, supplies, labels, catalogs, vehicles, signs,
packaging and products of the Washington Business, but only as described in
paragraphs (i) through (vi) of this Section 5.02(b), subject to the terms and
conditions of this Section 5.02(b) and Section 5.02(c), in each case in the same
manner and to the same extent as such names, trademarks, trade names, service
marks, corporate symbols or logos were used by the Washington Business at any
time within the two year period preceding the Time of Distribution:


                                       43
<PAGE>
            (i) All documents constituting Washington Assets as of the Time of
      Distribution within the following categories may be used for the duration
      of the periods following the Time of Distribution indicated below or until
      the supply is exhausted, whichever is the first to occur:

<TABLE>
<CAPTION>
                                                          Maximum Period
                                                          of Permitted Use
                                                          Following the
      Category of Documents                               Time of Distribution
      ---------------------                               --------------------
<S>                                                       <C>
      A.  Stationery                                      3 months
      B.  Invoices, purchase orders, debit and credit
          memos and other similar documents of a          3 months
          transactional nature
      C.  Business cards                                  3 months
      D.  Other outside forms such as packing lists,
          labels, packing materials and cartons, etc.     6 months
      E.  Forms for internal use only                     6 months
      F.  Product literature                              6 months;
</TABLE>

      provided, however, that Washington will cause each document within any of
      the above categories A, B or F used for any purpose within the stated
      period to clearly and prominently display a statement, the form of which
      is approved by Conexant, to the effect that the Washington Group was
      formerly affiliated with Conexant.

            (ii) All vehicles constituting Washington Assets as of the Time of
      Distribution may continue to be used without re-marking (except as to
      legally required permit numbers, license numbers, etc.) for a period not
      to exceed three months following the Time of Distribution or the date of
      disposition of the vehicle, whichever is the first to occur. Washington
      will cause all markings on such vehicles to be removed or permanently
      obscured prior to the disposition of such vehicles.

            (iii) Within three months following the Time of Distribution,
      Washington will remove or cause to be removed from display all signs and
      displays which contain the Conexant Marks.

            (iv) Products of the Washington Business may have applied thereto
      the names, trademarks, trade names or service marks "Conexant", "Conexant
      Systems" or "Conexant Systems, Inc." or any Conexant corporate symbol or
      logo related thereto for a period of three months after the Time of
      Distribution.


                                       44
<PAGE>
            (v) Products of the Washington Business in finished goods inventory
      and work in process (to the extent the same bear the name, trademark,
      trade name or service mark "Conexant", "Conexant Systems" or "Conexant
      Systems, Inc." or any Conexant corporate symbol or logo related thereto as
      of the Time of Distribution or have any such name, trademark, trade name,
      service mark, corporate symbol or logo applied to them in accordance with
      paragraph (iv) above) may be disposed of without re-marking.

            (vi) All documents of the Washington Business of the type described
      in paragraph (i) above and displays and signs of the Washington Business
      may, for a period not to exceed one year after the Distribution Date (or
      such longer period as shall be approved by Conexant), contain the
      statement "A Heritage of Conexant Technology" (or other similar phrase,
      the form of which is approved by Conexant) in conjunction with the name of
      Washington or any Subsidiary thereof so long as such statement is of a
      type no more prominent than such name of Washington or such Subsidiary
      thereof.

            (c) (i) Apart from the rights granted under Section 5.02(b), no
member of the Washington Group shall have any right, title or interest in or to
the use of the Conexant Marks, either alone or in combination with any other
word, name, symbol, device, trademarks, or any combination thereof. Anything
contained herein to the contrary notwithstanding, except as expressly permitted
by Section 5.02(b), in no event will any member of the Washington Group utilize
the Conexant Marks as a component of a company or trade name. Washington will
not, and will cause each other member of the Washington Group not to, challenge
or contest the validity of the Conexant Marks, the registration thereof or the
ownership thereof by the Conexant Group. Washington will not, and will cause
each other member of the Washington Group not to, apply anywhere at any time for
any registration as owner or exclusive licensee of the Conexant Marks. If,
notwithstanding the foregoing, any member of the Washington Group develops,
adopts or acquires, directly or indirectly, any right, title or interest in, or
to the use of, any Conexant Marks in any jurisdiction, or any goodwill incident
thereto, Washington will, upon the request of Conexant, and for a nominal
consideration of one dollar, assign or cause to be assigned to Conexant or any
designee of Conexant, all right, title and interest in, and to the use of, such
Conexant Marks in any and all jurisdictions, together with any goodwill incident
thereto.

            (ii) If the laws of any country require that any mark subject to
Section 5.02(b) or the right of any member of the Washington Group to use any
mark as permitted by Section 5.02(b) be registered in order to fully protect the
Conexant Group, Conexant and Washington will cooperate in constituting such
member of the Washington Group as a registered user (or its equivalent) in each
of the countries in which such registration is necessary. If any such laws of
any country require that any such mark or the use by any member of the
Washington Group of any such mark be registered prior to use in order to protect
fully the Conexant Group, the license granted pursuant to Section 5.02(b) will
not extend to such country until such registration has been effected to the
reasonable satisfaction of Conexant. Any expenses for registering such mark or
constituting such member of the Washington Group as a registered user in any
country shall be borne by


                                       45
<PAGE>
Washington. Any registration of such member of the Washington Group as a
registered user of any mark hereunder shall be expunged on termination of the
period of permitted use under this Agreement or upon a breach or threatened
breach by any member of the Washington Group of the terms of this Section 5.02
and Washington will, upon request of Conexant, take all necessary steps to cause
such registration to be so expunged upon such termination or breach or
threatened breach. In addition, Washington hereby constitutes and appoints
Conexant the true and lawful attorney of Washington, with full power of
substitution, in the name and on behalf of Washington (and at the cost of
Washington) to take all necessary steps to cause such registration to be so
expunged upon such termination or breach or threatened breach.

            (iii) Washington will cause each member of the Washington Group to
comply with the provisions of this Section 5.02. Nothing in this Section 5.02
will prevent any member of the Conexant Group from enforcing the provisions of
this Section 5.02 against any member of the Washington Group.

            (iv) Conexant will have the right to terminate the license granted
in Section 5.02(b) upon 30 days written notice to Washington for any material
failure by any member of the Washington Group to observe the terms of Section
5.02(b) or this Section 5.02(c), provided that such failure is not remedied
(where commercially feasible) prior to the effectiveness of the termination.

            (d) From and after the Time of Distribution, Washington will own all
rights of Conexant or any of its Subsidiaries (including members of the
Washington Group) in, and to the use of, the trademarks "Philsar" and "Philsar
Semiconductor" (the "Philsar Marks"). The provisions of Sections 5.02(a), (b)
and (c) shall be applicable to Conexant, Washington and the Philsar Marks
mutatis mutandis by substituting references to Conexant, the Conexant Marks, the
Conexant Group, Washington and the Washington Group with references to
Washington, the Philsar Marks, the Washington Group, Conexant and the Conexant
Group, respectively.

            Section 5.03 License of Intellectual Property.

            (a) License of Conexant Intellectual Property to Washington.

            (i) Subject to Sections 5.03(a)(iv) and 5.03(d), effective as of the
Time of Distribution, Conexant, on behalf of itself and the Conexant
Subsidiaries, hereby grants to the Washington Group a non-exclusive, world-wide,
irrevocable, royalty-free license, without the right to assign or grant
sublicenses, except as provided in Sections 5.03(a)(ii) and (iii), under all
Patents and Trademarks, Trade Secrets and other intellectual property rights
existing as of the Time of Distribution (collectively, "Intellectual Property")
that constitute Conexant Assets (excluding trademarks, trade names, domain
names, service marks, trade dress and any other form of trade identity) that the
Conexant Group has a right to license without the payment of royalties to a
third party, (A) with respect to any copyrighted work included in such
Intellectual Property, to reproduce, display, distribute and prepare derivative
works of such copyrighted work; and (B) to make, have made (including by
third-party contract


                                       46
<PAGE>
manufacturers), use, sell, offer for sale, import, or otherwise dispose of
products in the conduct of the Washington Business as it is being conducted
immediately prior to the Time of Distribution and any related extensions or
expansions thereof, and to practice any process involved in the use or
manufacture thereof; provided, that in connection with the Merger, this license
will also extend to products in the conduct of Alpha's business as it is being
conducted immediately prior to the Effective Time and any related extensions or
expansions thereof.

            (ii) The license granted under Section 5.03(a)(i) is non-assignable
and non-transferable (in insolvency proceedings, by reason of corporate merger,
by acquisition or other change of control or otherwise) by the Washington Group,
except that a one-time assignment may be made to Alpha and its Subsidiaries in
connection with the Merger.

            (iii) The license granted under Section 5.03(a)(i) does not include
the right to grant sublicenses, except that the Washington Group (or, following
the Effective Time, Alpha and its Subsidiaries) may grant a sublicense (within
the scope of such license) to any entity or business that is a spin-off or other
similar divestiture of all or any part of the Washington Group's businesses (or,
following the Effective Time, the Combined Company's businesses) (a "Washington
Spin-Off") and to any subsequent entity or business that is a spin-off or other
similar divestiture of all or any part of a Washington Spin-Off; provided,
however, that any such sublicense shall be subject to the same restrictions on
assignment and transfer as the original license granted in this Section 5.03(a).

            (iv) In the event that following the Effective Time, the Combined
Company or a Washington Spin-Off becomes insolvent or is acquired by or merges
with a third party, such license or sublicense shall immediately and
automatically terminate with respect to such Person and its Affiliates effective
as of the date of such insolvency, acquisition or merger, unless Conexant and
the Combined Company otherwise agree; provided, that such termination of such
license or sublicense shall not necessarily affect any other license or
sublicense.

            (v) Without limiting the foregoing, Conexant and Alpha shall confer
in good faith to determine whether and on what terms Conexant's rights under the
Lucent License Agreement may be sublicensed to Washington and/or the Combined
Company, and, if mutually agreed by Conexant and Alpha, Conexant shall grant a
sublicense as Conexant and Alpha may mutually determine may be granted, subject
to the terms and conditions of the Lucent License Agreement; provided, however,
that nothing in this Section 5.03(a)(v) shall require that Conexant pay any
additional fees or royalties under the Lucent License Agreement or grant any
sublicense to Washington and/or the Combined Company if Conexant in good faith
determines such sublicense would jeopardize any rights of Conexant under the
Lucent License Agreement.

            (b) License of Alpha Intellectual Property to Conexant

            (i) Subject to Section 5.03(b)(iv), effective immediately prior to
the Effective Time, Alpha, on behalf of itself and its Subsidiaries, hereby
grants to the Conexant Group a non-exclusive, world-wide, irrevocable
royalty-free license, without the right to


                                       47
<PAGE>
assign or grant sublicenses, except as provided in Sections 5.03(b)(ii) and
(iii), under all Intellectual Property owned by Alpha and its Subsidiaries
(excluding trademarks, trade names, domain names, service marks, trade dress and
any other form of trade identity) that Alpha and its Subsidiaries have a right
to license without the payment of royalties to a third party, (A) with respect
to any copyrighted work included in such Intellectual Property, to reproduce,
display, distribute and prepare derivative works of such copyrighted work; and
(B) to make, have made (including by third-party contract manufacturers), use,
sell, offer for sale, import, or otherwise dispose of products in the conduct of
the Conexant Business as it is being conducted immediately prior to the Time of
Distribution and any related extensions or expansions thereof, and to practice
any process involved in the use or manufacture thereof.

            (ii) The license granted under Section 5.03(b)(i) is non-assignable
and non-transferable (in insolvency proceedings, by reason of corporate merger,
by acquisition or other change in control or otherwise) by the Conexant Group.

            (iii) The license granted under Section 5.03(b)(i) does not include
the right to grant sublicenses, except that the Conexant Group may grant a
sublicense (within the scope of such license) to any entity or business that is
a spin-off or other similar divestiture of all or any part of the Conexant
Group's businesses (a "Conexant Spin-Off") and to any subsequent entity or
business that is a spin-off or other similar divestiture of all or any part of a
Conexant Spin-Off; provided, however, that any such sublicense shall be subject
to the same restrictions on assignment and transfer as the original license
granted in this Section 5.03(b).

            (iv) In the event that following the Effective Time, Conexant or a
Conexant Spin-Off becomes insolvent or is acquired by or merges with a third
party, such license or sublicense shall immediately and automatically terminate
with respect to such Person and its Affiliates effective as of the date of such
insolvency, acquisition or merger, unless Conexant and the Combined Company
otherwise agree; provided, that such termination of such license or sublicense
shall not necessarily affect any other license or sublicense.

            (c) License of Washington Intellectual Property to Conexant

            (i) Subject to in Sections 5.03(c)(iv) and 5.03(d), effective as of
the Time of Distribution, Washington, on behalf of itself and the Washington
Subsidiaries, hereby grants to the Conexant Group a non-exclusive, world-wide,
irrevocable, royalty-free license, without the right to assign or grant
sublicenses, except as provided in Sections 5.03(c)(ii) and (iii), under all
Intellectual Property that constitute Washington Assets (excluding trademarks,
trade names, domain names, service marks, trade dress and any other form of
trade identity) that the Washington Group has a right to license without the
payment of royalties to a third party, (A) with respect to any copyrighted work
included in such Intellectual Property, to reproduce, display, distribute and
prepare derivative works of such copyrighted work; and (B) to make, have made
(including by third-party contract manufacturers), use, sell, offer for sale,
import, or otherwise dispose of products in the conduct of the Conexant Business
as it is being conducted immediately prior to the Time of Distribution and any
related extensions or expansions thereof, and to practice any process involved
in the use or manufacture thereof.


                                       48
<PAGE>
            (ii) The license granted under Section 5.03(c)(i) is not assignable
and non-transferable (in insolvency proceedings, by reason of corporate mergers,
by acquisition or other change of control or otherwise) by the Conexant Group.

            (iii) The license granted under Section 5.03(c)(i) does not include
the right to grant sublicenses, except that the Conexant Group may grant a
sublicense (within the scope of such license) to any Conexant Spin-Off and to
any subsequent entity or business that is a spin-off or other similar
divestiture of all or any part of a Conexant Spin-Off; provided, however, that
any such sublicense shall be subject to the same restrictions on assignment and
transfer as the original license granted in this Section 5.03(c).

            (iv) In the event that following the Effective Time, Conexant or a
Conexant Spin-Off becomes insolvent or is acquired by or merges with a third
party, such license or sublicense shall immediately and automatically terminate
with respect to such Person and its Affiliates effective as of the date of such
insolvency, acquisition or merger, unless Conexant and the Combined Company
otherwise agree; provided, that such termination of such license or sublicense
shall not necessarily affect any other license or sublicense.

            (d) Field of Use Restrictions on Bluetooth Technology

            (i) Notwithstanding anything to the contrary contained in this
Agreement, effective immediately after the Time of Distribution and continuing
for a term of eighteen months, Conexant agrees that no member of the Conexant
Group shall sell or offer for sale the Washington Bluetooth RF Solution on a
stand-alone basis into any market , and that no member of the Conexant Group
shall sell or offer for sale the combination of the Washington Bluetooth RF
Solution with the Conexant Bluetooth Baseband Solution into the cellular handset
market; provided, however, that nothing in this Section 5.03(d)(i) shall
prohibit any member of the Conexant Group from selling the Conexant Bluetooth
Baseband Solution, a third-party Bluetooth RF solution or any other Bluetooth RF
solution that is not substantially based on the Washington Bluetooth RF Solution
into any market.

            (ii) Notwithstanding anything to the contrary contained in this
Agreement, effective immediately after the Time of Distribution and continuing
for a term of eighteen months, Washington agrees that no member of the
Washington Group (and, following the Effective Time, Alpha agrees that neither
it nor any of its Subsidiaries) shall sell or offer for sale the Conexant
Bluetooth Baseband Solution into any market outside the cellular handset market,
whether on a stand-alone basis or in combination with the Washington Bluetooth
RF Solution, unless the Conexant Bluetooth Baseband Solution is sold in
combination with the Washington Group's cellular chipset solution; provided,
however, that nothing in this Section 5.03(d)(ii) shall prohibit any member of
the Washington Group (or, following the Effective Time, Alpha and its
Subsidiaries) from selling the Washington Bluetooth RF Solution, a third-party
Bluetooth baseband solution or any other Bluetooth baseband solution that is not
substantially based on the Conexant Bluetooth Baseband Solution into any market.


                                       49
<PAGE>
            (e) Administrative Services Software.

            (i) For purposes of this Section 5.03(e), the following terms will
have the following definitions:

            (A) "Administrative Services" means services pertaining to
      personnel, payroll, property management, benefits, human resource
      management, financial planning, case docketing and management, contract
      and subcontract management, facilities management, proposal activities,
      supply chain planning for production, product distribution, material
      requirements planning, inventory management, engineering documentation
      control, workflow and e-mail management, networks and computer systems
      management and other similar services.

            (B) "Administrative Services Software" means software originated
      internally and owned by Conexant or any of its Subsidiaries (including
      members of the Washington Group) prior to the Time of Distribution and
      relating to the provision of Administrative Services to the Conexant
      Business or the Washington Business immediately prior to the Time of
      Distribution, regardless of where ownership of such software vests after
      the Time of Distribution. Administrative Services Software also shall
      include materials and documentation supplied by one party to the other
      pursuant to clause (iv) of this Section 5.03(e).

            (ii) Anything contained herein to the contrary notwithstanding, the
following licenses shall govern the licensing of Administrative Services
Software:

            (A) Effective as of the Time of Distribution, Conexant, on behalf of
      itself and the Conexant Subsidiaries, hereby grants to Washington a
      royalty-free, world-wide, irrevocable, non-exclusive license to use
      Administrative Services Software which constitutes Conexant Assets and
      which immediately after the Time of Distribution is either owned by the
      Conexant Group or under which the Conexant Group has a right to license
      without the payment of royalties to a third party, but only for the
      internal business purposes of the Washington Group, including the right to
      sublicense only to (x) members of the Washington Group and (y) service
      providers and similar third parties to use the Administrative Services
      Software only for or on behalf of the Washington Group.

            (B) Effective as of the Time of Distribution, Washington, on behalf
      of itself and the Washington Subsidiaries, hereby grants to Conexant a
      royalty-free, world-wide, irrevocable, non-exclusive license to use
      Administrative Services Software which constitutes Washington Assets and
      which immediately after the Time of Distribution is either owned by the
      Washington Group or under which the Washington Group has a right to
      license without the payment of royalties to a third party, but only for
      the internal business purposes of the Conexant Group, including the right
      to sublicense only to (x) members of the Conexant Group and (y) service
      providers and similar third parties to use the Administrative Services
      Software only for or on behalf of the Conexant Group.


                                       50
<PAGE>
            (C) Except as set forth in this paragraph (e)(ii), the licenses
granted pursuant to this Section 5.03(e) do not include the right to sublicense.

            (iii) Each party shall have the right to use, disclose, perform,
display, copy, distribute and make derivative works of Administrative Services
Software within the scope of the licenses granted herein. Title to
Administrative Services Software and all rights therein, including all rights in
patents, copyrights and trade secrets and any other intellectual property rights
applicable thereto, shall remain vested in the party to which ownership is
allocated pursuant to this Agreement. Notwithstanding anything to the contrary
contained herein, each licensed party agrees that it will not use, copy,
disclose, sell, assign or sublicense, or otherwise transfer Administrative
Services Software licensed to it under this Section 5.03(e) or any derivative
works thereof, except as expressly provided in this Section 5.03(e) and Section
7.07.

            (iv) To the extent that a licensed party does not have copies of any
Administrative Services Software or materials and documentation (such as source
code listings, flow charts, user guides and programmer's guides) relating to the
operation and maintenance of such Administrative Services Software to which the
other party has ownership, such owning party shall, as soon as practicable after
request of the licensed party, supply to the licensed party copies of such
Administrative Services Software and any related operating and maintenance
materials or documentation existing as of the Time of Distribution.

            (v) In the event that Administrative Services Software is used by
the owner in the ordinary course of its business either associated or bundled
with software owned or controlled by a third party (e.g., as a suite of
software), without which the Administrative Services Software would be wholly or
partly inoperable or otherwise unfit for its intended purposes, the grant of the
licenses under the provisions of this Section 5.03(e) shall not be construed as
an implied license to use the software of such a third party or as an
undertaking on the part of the owner of the Administrative Services Software to
obtain a license to permit the use of such third party software.

            (f) (i) Conexant makes no representations or warranties of any kind
with respect to the validity, scope or enforceability of any intellectual
property rights licensed by Conexant or the Conexant Subsidiaries pursuant to
this Section 5.03 and none of Conexant or the Conexant Subsidiaries has any
obligation to file or prosecute any patent applications or maintain any patents
in force in connection therewith. Notwithstanding anything contained herein to
the contrary, this Section 5.03 will not be applicable to any rights in, or to
the use of, the Conexant Marks (which are the subject of Section 5.02).

            (ii) Washington makes no representations or warranties of any kind
with respect to the validity, scope or enforceability of any intellectual
property rights licensed by Washington or the Washington Subsidiaries pursuant
to this Section 5.03 and none of Washington or the Washington Subsidiaries has
any obligation to file or prosecute any patent applications or maintain any
patents in force in connection therewith.


                                       51
<PAGE>
            Section 5.04 Software and Other License Agreements. If after the
Time of Distribution, Washington (or any member of the Washington Group) no
longer has licensee rights under any software or other license agreement of
Conexant (or any member of the Conexant Group) (a "Conexant License Agreement")
that, prior to the Time of Distribution, was used in the conduct of the
Washington Business (i) because such license agreement does not constitute a
Washington Asset; (ii) because the transfer of, or sublicense under, such
Conexant License Agreement required the consent of a third party and such
consent was not obtained or (iii) for any other reason, then Washington shall be
responsible for all costs and expenses incurred in connection with the
procurement of new license agreements to replace any such Conexant License
Agreements or the transfer or assignment of a portion of such Conexant License
Agreement (to the extent mutually agreed by Conexant, Washington and the
licensor), including, but not limited to, any fees payable to the licensor in
connection therewith and the portion of any pre-paid amounts allocable to the
portion of the Conexant License Agreement transferred. Conexant will use
commercially reasonable efforts to assist Washington in the procurement of such
new license agreements or the transfer of a portion of such Conexant License
Agreement; provided that all of Conexant's costs and expenses incurred in
connection therewith shall be paid by Washington.

            Section 5.05 Non-Solicitation of Employees. Without the express
written agreement of either (a) both the Chief Executive Officer of Conexant and
the Chief Executive Officer of Alpha or (b) both the Senior Vice President,
Human Resources of Conexant and the Vice President, Treasurer, Chief Financial
Officer and Secretary of Alpha:

            (a) Conexant agrees not to (and to cause the other members of the
      Conexant Group not to) solicit, recruit or hire any employee of, or
      individuals providing contracting services to, Washington or any other
      member of the Washington Group until December 31, 2003 or until six months
      after such employee's employment with, or such individual's provision of
      contracting services to, Washington or any other member of the Washington
      Group terminates, whichever occurs first;

            (b) Washington agrees not to (and to cause the other members of the
      Washington Group, Alpha and all Subsidiaries and Affiliates of Alpha not
      to) solicit, recruit or hire any employee of, or individuals providing
      contracting services to, Conexant or any other member of the Conexant
      Group until December 31, 2003 or until six months after such employee's
      employment with, or such individual's provision of contracting services
      to, Conexant or any other member of the Conexant Group terminates,
      whichever occurs first; and

            (c) Notwithstanding the foregoing (but subject to the restriction on
      hiring), such prohibitions on solicitation do not restrict general
      recruitment efforts carried out through a public or general solicitation.


                                       52
<PAGE>
                                   ARTICLE VI

                              ACCESS TO INFORMATION


            Section 6.01 Provision of Corporate Records. Prior to or as promptly
as practicable after the Time of Distribution, Conexant shall deliver to
Washington all minute books and other records of meetings of the Board of
Directors, committees of the Board of Directors and stockholders of the
Washington Group, all corporate books and records of the Washington Group in its
possession and the relevant portions (or copies thereof) of all corporate books
and records of the Conexant Group relating directly and primarily to the
Washington Assets, the Washington Business or the Washington Liabilities,
including, in each case, all active agreements and active litigation files. From
and after the Time of Distribution, all such books, records and copies shall be
the property of Washington. Prior to or as promptly as practicable after the
Time of Distribution, Washington shall deliver to Conexant all corporate books
and records of the Conexant Group in Washington's possession (other than the
books, records and copies described in the first sentence of this Section 6.01)
and the relevant portions (or copies thereof) of all corporate books and records
of the Washington Group relating directly and primarily to the Conexant Assets,
the Conexant Business or the Conexant Liabilities, including, in each case, all
active agreements and active litigation files. From and after the Time of
Distribution, all such books, records and copies shall be the property of
Conexant.

            Section 6.02 Access to Information. (a) From and after the Time of
Distribution, Conexant will, and will cause each Conexant Subsidiary to, afford
to Washington and its Representatives (at Washington's expense) reasonable
access and duplicating rights during normal business hours and upon reasonable
advance notice to all pre-Distribution Information within the Conexant Group's
possession or control relating to Washington, any Washington Subsidiary, any
Washington Asset, any Washington Liability or the Washington Business, insofar
as such access is reasonably required by Washington or any Washington
Subsidiary, subject to the provisions below regarding Privileged Information.

            (b) From and after the Time of Distribution, Washington will, and
will cause each Washington Subsidiary to, afford to Conexant and its
Representatives (at Conexant's expense) reasonable access and duplicating rights
during normal business hours and upon reasonable advance notice to all
pre-Distribution Information within the Washington Group's possession or control
relating to Conexant, any Conexant Subsidiary, any Conexant Asset, any Conexant
Liability or the Conexant Business, insofar as such access is reasonably
required by Conexant or any Conexant Subsidiary, subject to the provisions below
regarding Privileged Information.

            (c) Without limiting the foregoing, Information may be requested
under this Article VI for audit (including in respect of any audit of the
Washington Business after the Time of Distribution), accounting, claims,
litigation, insurance, environmental and safety and tax purposes, as well as for
purposes of fulfilling disclosure and reporting obligations and for performing
this Agreement and the transactions contemplated hereby.


                                       53
<PAGE>
            In furtherance of the foregoing:

            (i) Each party acknowledges that (A) each of Conexant and Washington
      (and the members of the Conexant Group and the Washington Group,
      respectively) has or may obtain Privileged Information; (B) there are or
      may be a number of Actions affecting one or more of the members of the
      Conexant Group and the Washington Group; (C) the parties may have a common
      legal interest in Actions, in the Privileged Information, and in the
      preservation of the confidential status of the Privileged Information; and
      (D) each of Conexant and Washington intends that the transactions
      contemplated by the Transaction Agreements and any transfer of Privileged
      Information in connection therewith shall not operate as a waiver of any
      potentially applicable privilege.

            (ii) Each of Conexant and Washington agrees, on behalf of itself and
      each member of the Group of which it is a member, not to disclose or
      otherwise waive any privilege attaching to any Privileged Information
      relating to the pre-Distribution business of the other Group or relating
      to or arising in connection with the relationship between the Groups on or
      prior to the Time of Distribution, without providing prompt written notice
      to and obtaining the prior written consent of the other, which consent
      will not be unreasonably withheld. In the event of a disagreement between
      any member of the Conexant Group and/or any member of the Washington Group
      concerning the reasonableness of withholding such consent, no disclosure
      will be made prior to a final, nonappealable resolution of such
      disagreement by a court of competent jurisdiction.

            (iii) Upon any member of the Conexant Group or any member of the
      Washington Group receiving any subpoena or other compulsory disclosure
      notice from a court, other Governmental Entity or otherwise which requests
      disclosure of Privileged Information, in each case relating to the
      pre-Distribution business of the other Group or relating to or arising in
      connection with the relationship between the Groups on or prior to the
      Time of Distribution, the recipient of the notice will promptly provide to
      the other party (following the notice provisions set forth herein) a copy
      of such notice, the intended response, and a description of all materials
      or information relating to the other Group that might be disclosed. In the
      event of a disagreement as to the intended response or disclosure, unless
      and until the disagreement is resolved as provided in Section 6.02(c)(ii),
      the parties will cooperate to assert all defenses to disclosure claimed by
      either Group, at the cost and expense of the Group claiming such defense
      to disclosure, and shall not disclose any disputed documents or
      information until all legal defenses and claims of privilege have been
      finally determined.

            Section 6.03 Production of Witnesses. Subject to Section 6.02, after
the Time of Distribution, each of Conexant and Washington will, and will cause
each member of the Conexant Group and the Washington Group, respectively, to,
make available to the other party and members of such other party's Group, upon
written request and at the cost and expense of the party so requesting, its
directors, officers, employees and agents as witnesses


                                       54
<PAGE>
to the extent that any such Person may reasonably be required (giving
consideration to business demands of such directors, officers, employees and
agents) in connection with any Actions, administrative or other proceedings in
which the requesting party may from time to time be involved and relating to the
pre-Distribution business of either Group or relating to or arising in
connection with the relationship between the Groups on or prior to the Time of
Distribution, provided that the same shall not unreasonably interfere with the
conduct of business by the Group of which the request is made.

            Section 6.04 Retention of Records. Except as otherwise required by
law or agreed to by the parties in writing, if any Information relating to the
pre-Distribution business, Assets or Liabilities of a member of a Group is
retained by a member of the other Group, each of Conexant and Washington will,
and will cause the members of the Group of which it is a member to, retain for
the period required by the applicable Conexant records retention policy in
effect immediately prior to the Time of Distribution all such Information in
such Group's possession or under its control. In addition, after the expiration
of such required retention period, if any member of either Group wishes to
destroy or dispose of any such Information, prior to destroying or disposing of
any of such Information, (i) Conexant or Washington, on behalf of the member of
its Group that is proposing to destroy or dispose of any such Information, will
provide no less than 30 days' prior written notice to the other party,
specifying in reasonable detail the Information proposed to be destroyed or
disposed of, and (ii) if, prior to the scheduled date for such destruction or
disposal, the recipient of such notice requests in writing that any of the
Information proposed to be destroyed or disposed of be delivered to such
requesting party, the party whose Group is proposing to destroy or dispose of
such Information promptly will arrange for the delivery of the requested
Information to a location specified by, and at the expense of, the requesting
party.

            Section 6.05 Confidentiality. Subject to the provisions of Section
6.02, which shall govern Privileged Information, from and after the Time of
Distribution, each of Conexant and Washington shall hold, and shall use
reasonable efforts to cause members of its Group and its and their Affiliates
and Representatives to hold, in strict confidence all Information concerning the
other party's Group in its possession or control prior to the Time of
Distribution or furnished to it by such other party's Group pursuant to the
Transaction Agreements or the transactions contemplated thereby and will not
release or disclose such Information to any other Person, except members of its
Group and its and their Representatives, who will be bound by the provisions of
this Section 6.05; provided, however, that any member of the Conexant Group or
the Washington Group may disclose such Information to the extent that (a)
disclosure is compelled by judicial or administrative process or, in the opinion
of such Person's counsel, by other requirements of law (in which case the party
required to make such disclosure will notify the other party as soon as
practicable of such obligation or requirement and cooperate with the other party
to limit the Information required to be disclosed and to obtain a protective
order or other appropriate remedy with respect to the Information ultimately
disclosed) or (b) such Person can show that such Information was (i) available
to such Person on a nonconfidential basis (other than from a member of the other
party's Group) prior to its disclosure by such Person, (ii) in the public domain
through no fault of such Person or (iii) lawfully acquired by such Person from
another source after the time that it was furnished to such Person by the other
party's Group, and not


                                       55
<PAGE>
acquired from such source subject to any confidentiality obligation on the part
of such source known to the acquiror, or on the part of the acquiror. Each party
acknowledges that it will be liable for any breach of this Section 6.05 by its
Affiliates, Representatives and Subsidiaries. Notwithstanding the foregoing,
each of Conexant and Washington will be deemed to have satisfied its obligations
under this Section 6.05 with respect to any Information (other than Privileged
Information) if it exercises the same care with regard to such Information as it
takes to preserve confidentiality for its own similar Information.


                                   ARTICLE VII

                                  MISCELLANEOUS


            Section 7.01 Entire Agreement; Construction. This Agreement and the
Ancillary Agreements, including any annexes, schedules and exhibits hereto or
thereto, and other agreements and documents referred to herein and therein, will
together constitute the entire agreement between the parties with respect to the
subject matter hereof and thereof and will supersede all prior negotiations,
agreements and understandings of the parties of any nature, whether oral or
written, with respect to such subject matter. Notwithstanding any other
provisions in the Transaction Agreements to the contrary, (i) in the event and
to the extent that there is a conflict between the provisions of this Agreement
and the provisions of the Employee Matters Agreement or the Tax Allocation
Agreement, the provisions of the Employee Matters Agreement or the Tax
Allocation Agreement, as appropriate, will control and (ii) in the event and to
the extent that there is a conflict between the provisions of this Agreement and
the provisions of any Conveyance and Assumption Instruments, the provisions of
this Agreement will control.

            Section 7.02 Survival of Agreements. Except as otherwise
contemplated by the Transaction Agreements, all covenants and agreements of the
parties contained in the Transaction Agreements will remain in full force and
effect and survive the Time of Distribution.

            Section 7.03 Governing Law. This Agreement will be governed by and
construed in accordance with the internal laws of the State of Delaware
applicable to contracts made and to be performed entirely within such State,
without regard to the conflicts of law principles of such State.

            Section 7.04 Notices. All notices, requests, claims, demands and
other communications required or permitted to be given hereunder will be in
writing and will be delivered by hand or telecopied, e-mailed or sent, postage
prepaid, by registered, certified or express mail or reputable overnight courier
service and will be deemed given when so delivered by hand or telecopied, when
e-mail confirmation is received if delivered by e-mail, or three Business Days
after being so mailed (one Business Day in the case of express mail or overnight
courier service). All such notices, requests, claims, demands and other
communications will be addressed as set forth below, or pursuant to such other
instructions as may be designated in writing by the party to receive such
notice:


                                       56
<PAGE>
            (a)   If to Conexant:


                  Conexant Systems, Inc.
                  4311 Jamboree Road
                  Newport Beach, California  92660-3095

                  Attention: Dwight W. Decker
                             Chairman of the Board and Chief Executive Officer
                  Telecopy:  (949) 483-4318
                  E-mail:    dwight.decker@conexant.com

                  with a copy to:


                  Conexant Systems, Inc.
                  4311 Jamboree Road
                  Newport Beach, California  92660-3095

                  Attention: Dennis E. O'Reilly, Esq.
                             Senior Vice President, General Counsel
                             and Secretary
                  Telecopy:  (949) 483-6388
                  E-mail:    dennis.o'reilly@conexant.com

            (b)   If to Washington after the Effective Time:


                  Washington Sub, Inc.
                  c/o Alpha Industries, Inc.
                  20 Sylvan Road
                  Woburn, Massachusetts  01801

                  Attention: Paul E. Vincent
                             Chief Financial Officer
                  Telecopy:  (617) 824-4426
                  E-mail:    pvincent@alphaind.com


                                       57
<PAGE>
                  with a copy to:


                  Alpha Industries, Inc.
                  20 Sylvan Road
                  Woburn, Massachusetts  01801

                  Attention: James K. Jacobs, Esq.
                             General Counsel
                  Telecopy:  (617) 824-4564
                  E-mail:    jjacobs@alphaind.com

            Section 7.05 Dispute Resolution. In the event that from and after
the Time of Distribution any dispute, claim or controversy (collectively, a
"Dispute") arises out of or relates to any provision of any Transaction
Agreement or the breach, performance, enforcement or validity or invalidity
thereof, the designees of the Conexant Chief Executive Officer and the Alpha
Chief Executive Officer will attempt a good faith resolution of the Dispute
within thirty days after either party notifies the other party in writing of the
Dispute. If the Dispute is not resolved within thirty days of the receipt of the
notification, or within such other time as they may agree, the Dispute will be
referred for resolution to the Conexant Chief Executive Officer and the Alpha
Chief Executive Officer. Should they be unable to resolve the Dispute within
thirty days following the referral to them, or within such other time as they
may agree, Conexant and Washington will then attempt in good faith to resolve
such Dispute by mediation in accordance with the then-existing CPR Mediation
Procedures promulgated by the CPR Institute for Dispute Resolution, New York
City. If such mediation is unsuccessful within thirty days (or such other period
as the parties may mutually agree) after the commencement thereof, such Dispute
shall be submitted by the parties to binding arbitration, initiated and
conducted in accordance with the then-existing American Arbitration Association
Commercial Arbitration Rules, before a single arbitrator selected jointly by
Conexant and Alpha, who shall not be the same person as the mediator appointed
pursuant to the preceding sentence. If Conexant and Alpha cannot agree upon the
identity of an arbitrator within ten days after the arbitration process is
initiated, then the arbitration will be conducted before three arbitrators, one
selected by Conexant, one selected by Alpha and the third selected by the first
two. The arbitration shall be conducted in San Francisco, California and shall
be governed by the United States Arbitration Act, 9 U.S.C. Sections 1-16, and
judgment upon the award may be entered by any court having jurisdiction thereof.
The arbitrators shall have case management authority and shall resolve the
Dispute in a final award within one hundred eighty days from the commencement of
the arbitration action, subject to any extension of time thereof allowed by the
arbitrators upon good cause shown.

            Section 7.06 Amendments. This Agreement cannot be amended, modified
or supplemented except by a written agreement executed by Conexant and
Washington that is consented to in writing by Alpha.

            Section 7.07 Assignment. Except as otherwise provided herein,
neither party to this Agreement will convey, assign or otherwise transfer any of
its rights or obligations


                                       58
<PAGE>
under this Agreement without the prior written consent of the other party and
Alpha in its sole and absolute discretion. Notwithstanding the foregoing, either
party may (without obtaining any consent) assign, delegate or sublicense all or
any portion of its rights and obligations hereunder to (i) the surviving entity
resulting from a merger or consolidation involving such party, (ii) the
acquiring entity in a sale or other disposition of all or substantially all of
the assets of such party as a whole or of any line of business or division of
such party, or (iii) any other Person that is created as a result of a spin-off
from, or similar reorganization transaction of, such party or any line of
business or division of such party. In the event of an assignment pursuant to
(ii) or (iii) above, the nonassigning party shall, at the assigning party's
request, use good faith commercially reasonable efforts to enter into separate
agreements with each of the resulting entities and take such further actions as
may be reasonably required to assure that the rights and obligations under this
Agreement are preserved, in the aggregate, and divided equitably between such
resulting entities. Any conveyance, assignment or transfer requiring the prior
written consent of another party pursuant to this Section 7.07 which is made
without such consent will be void ab initio. No assignment of this Agreement
will relieve the assigning party of its obligations hereunder.

            Section 7.08 Captions; Currency. The article, section and paragraph
captions herein and the table of contents hereto are for convenience of
reference only, do not constitute part of this Agreement and will not be deemed
to limit or otherwise affect any of the provisions hereof. Unless otherwise
specified, all references herein to numbered articles or sections are to
articles and sections of this Agreement and all references herein to schedules
are to schedules to this Agreement. Unless otherwise specified, all references
contained in this Agreement, in any schedule referred to herein or in any
instrument or document delivered pursuant hereto to dollars or "$" shall mean
United States Dollars.

            Section 7.09 Severability. If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances other than those as to which it has been held invalid or
unenforceable, will remain in full force and effect and will in no way be
affected, impaired or invalidated thereby. If the economic or legal substance of
the transactions contemplated hereby is affected in any manner adverse to any
party as a result thereof, the parties will negotiate in good faith in an effort
to agree upon a suitable and equitable substitute provision to effect the
original intent of the parties.

            Section 7.10 Parties in Interest. This Agreement is binding upon and
is for the benefit of the parties hereto and their respective successors and
permitted assigns. This Agreement is not made for the benefit of any Person not
a party hereto, and no Person other than the parties hereto or their respective
successors and permitted assigns will acquire or have any benefit, right, remedy
or claim under or by reason of this Agreement, except that (i) the provisions of
Sections 4.02 and 4.03 shall inure to the benefit of and shall be enforceable by
the Persons referred to therein and (ii) the provisions of Sections 2.01, 3.01,
5.03, 7.06, 7.07 and 7.10 and the last sentence of Section 7.12 shall inure to
the benefit of and shall be enforceable by Alpha.


                                       59
<PAGE>
            Section 7.11 Schedules. All schedules attached hereto are hereby
incorporated in and made a part of this Agreement as if set forth in full
herein. Capitalized terms used in the schedules hereto but not otherwise defined
therein will have the respective meanings assigned to such terms in this
Agreement.

            Section 7.12 Waivers; Remedies. No failure or delay on the part of
either Conexant or Washington in exercising any right, power or privilege
hereunder will operate as a waiver thereof, nor will any waiver on the part of
either Conexant or Washington of any right, power or privilege hereunder operate
as a waiver of any other right, power or privilege hereunder, nor will any
single or partial exercise of any right, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege hereunder. Subject to Section 7.05, except as otherwise provided
herein, the rights and remedies herein provided are cumulative and are not
exclusive of any rights or remedies which the parties may otherwise have at law
or in equity. Notwithstanding the foregoing, Washington will not waive any
right, power or privilege hereunder in any material respect without the prior
written consent of Alpha.

            Section 7.13 Further Assurances. From time to time after the Time of
Distribution, as and when requested by either party hereto, the other party
shall execute and deliver, or cause to be executed and delivered, all such
documents and instruments and shall take, or cause to be taken, all such actions
as the requesting party may reasonably request to consummate the transactions
contemplated by the Transaction Agreements.

            Section 7.14 Counterparts. This Agreement may be executed in
separate counterparts, each such counterpart being deemed to be an original
instrument, and all such counterparts will together constitute the same
agreement. This Agreement may be executed and delivered by telecopier with the
same force and effect as if it were a manually executed and delivered
counterpart.

            Section 7.15 Performance. Conexant will cause to be performed and
hereby guarantees the performance of all actions, agreements and obligations set
forth herein to be performed by any Conexant Subsidiary. Washington will cause
to be performed and hereby guarantees the performance of all actions, agreements
and obligations set forth herein to be performed by any Washington Subsidiary.

            Section 7.16 Currency Calculations. Following the Distribution Date,
for purposes of calculating the United States Dollar equivalent of any amount
payable under any Transaction Agreement which is denominated in a currency other
than United States Dollars, the New York foreign exchange selling rate
applicable to such currency will be used, as published in the Wall Street
Journal, New York Edition, for the second Business Day preceding the earlier of
the date such payment is due or the date such payment is made (it being
understood that this Section 7.16 shall not apply to the conversion of foreign
currency balances made as of the Distribution Date in accordance with standard
Conexant accounting practices and procedures).


                                       60
<PAGE>
            Section 7.17 Interpretation. Any reference herein to any federal,
state, local, or foreign law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. For
the purposes of this Agreement, (a) words in the singular shall be held to
include the plural and vice versa and words of one gender shall be held to
include the other gender as the context requires, (b) the terms "hereof",
"herein", and "herewith" and words of similar import shall, unless otherwise
stated, be construed to refer to this Agreement as a whole and not to any
particular provision of this Agreement and (c) the word "including" and words of
similar import when used in this Agreement shall mean "including, without
limitation".

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]


                                       61
<PAGE>
            IN WITNESS WHEREOF, the parties have caused this Agreement, as
amended, to be signed by their respective officers thereunto duly authorized.

                                    CONEXANT SYSTEMS, INC.


                                    By: /s/ DENNIS E. O'REILLY
                                        --------------------------------------
                                        Name:  Dennis E. O'Reilly
                                        Title: Senior Vice President, General
                                               Counsel and Secretary



                                    WASHINGTON SUB, INC.


                                    By: /s/ DENNIS E. O'REILLY
                                        --------------------------------------
                                        Name:  Dennis E. O'Reilly
                                        Title: Vice President and Secretary



            Alpha acknowledges that from and after the Effective Time (as
defined in the Merger Agreement), Alpha will succeed to all rights, obligations
and Liabilities of Washington under this Agreement, as amended. In addition,
Alpha hereby agrees to be bound by, and to cause its Subsidiaries to be bound
by, the provisions of Section 5.03 and 7.05 that are applicable to Alpha and its
Subsidiaries.

                                    ALPHA INDUSTRIES, INC.


                                    By: /s/ PAUL E. VINCENT
                                        --------------------------------------
                                        Name:  Paul E. Vincent
                                        Title: Vice President, Chief Financial
                                               Officer, Treasurer & Secretary


                                       62


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-2.3
<SEQUENCE>4
<FILENAME>b43517ssexv2w3.txt
<DESCRIPTION>MEXICAN STOCK PURCHASE AGREEMENT
<TEXT>
<PAGE>

                                                                     EXHIBIT 2.3


================================================================================



                        MEXICAN STOCK PURCHASE AGREEMENT

                            DATED AS OF JUNE 25, 2002

                                 BY AND BETWEEN

                             CONEXANT SYSTEMS, INC.

                                       AND

                             ALPHA INDUSTRIES, INC.



================================================================================
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                     Page No.
                                                                                                     --------
<S>                      <C>                                                                         <C>
ARTICLE I                DEFINITIONS.....................................................................2


ARTICLE II               SALE AND PURCHASE OF STOCK.....................................................11

     Section 2.1.        Purchase and Sale of Shares and Minority Shares................................11
     Section 2.2.        Purchase Price.................................................................11
     Section 2.3.        Liabilities of Maquiladora.....................................................11

ARTICLE III              SELLER'S REPRESENTATIONS AND WARRANTIES........................................12

     Section 3.1.        Corporate Status, Good Standing and Authorization..............................12
     Section 3.2.        Authority; Enforceability......................................................12
     Section 3.3.        Consents; No Conflicts or Violations...........................................12
     Section 3.4.        Stock of Maquiladora...........................................................13
     Section 3.5.        Permits........................................................................13
     Section 3.6.        Compliance with Laws...........................................................14
     Section 3.7.        Financial Statements...........................................................14
     Section 3.8.        Absence of Certain Changes or Events...........................................14
     Section 3.9.        Facility.......................................................................15
     Section 3.10.       Litigation.....................................................................15
     Section 3.11.       Maquiladora Employee Matters...................................................15
     Section 3.12.       Maquiladora Labor Relations....................................................16
     Section 3.13.       Tax Matters....................................................................16
     Section 3.14.       Environmental Matters..........................................................17
     Section 3.15.       Material Contracts of Maquiladora..............................................18
     Section 3.16.       No Brokers.....................................................................19
     Section 3.17.       Title to Properties............................................................19
     Section 3.18.       Insurance......................................................................19
     Section 3.19.       Separate Tax Parcel............................................................20
     Section 3.20.       Utilities, etc.................................................................20

ARTICLE IV               PURCHASER'S REPRESENTATIONS AND WARRANTIES.....................................20

     Section 4.1.        Organization of Purchaser......................................................20
     Section 4.2.        Authority; Enforceability......................................................20
     Section 4.3.        Consents; No Conflicts or Violations...........................................20
     Section 4.4.        Litigation.....................................................................21
     Section 4.5.        No Brokers.....................................................................21

ARTICLE V                COVENANTS......................................................................22

     Section 5.1.        Access.........................................................................22
</TABLE>


                                       i
<PAGE>
<TABLE>
<CAPTION>
                                                                                                     Page No.
                                                                                                     --------
<S>                      <C>                                                                         <C>
     Section 5.2.        Reasonable Best Efforts........................................................23
     Section 5.3.        Conduct of Business by Seller and Maquiladora..................................25
     Section 5.4.        Elimination of Intercompany Accounts...........................................26
     Section 5.5.        Intercompany Agreements........................................................27
     Section 5.6.        Mutual Release.................................................................27
     Section 5.7.        Public Announcements...........................................................28
     Section 5.8.        Supplements to Schedules.......................................................28
     Section 5.9.        Insurance......................................................................28
     Section 5.10.       Transition Services Agreement..................................................31
     Section 5.11.       Post-Closing Adjustment........................................................31

ARTICLE VI               CONDITIONS TO SELLER'S AND PURCHASER'S OBLIGATIONS.............................31

     Section 6.1.        HSR Act........................................................................31
     Section 6.2.        Mexican Competition Commission Approval........................................31
     Section 6.3.        No Injunctions or Restraints, Illegality.......................................31
     Section 6.4.        Completion of the Merger.......................................................32

ARTICLE VII              ADDITIONAL CONDITIONS TO SELLER'S AND PURCHASER'S OBLIGATIONS..................32

     Section 7.1.        Conditions to Seller's Obligations.............................................32
     Section 7.2.        Conditions to Purchaser's Obligations..........................................32

ARTICLE VIII             CLOSING........................................................................33

     Section 8.1.        Deliveries by Seller...........................................................33
     Section 8.2.        Deliveries by Minority Shareholder.............................................34
     Section 8.3.        Deliveries by Purchaser........................................................34
     Section 8.4.        Deliveries by Minority Purchaser...............................................35

ARTICLE IX               INDEMNIFICATION................................................................35

     Section 9.1.        Indemnification by Seller......................................................35
     Section 9.2.        Indemnification by Purchaser...................................................35
     Section 9.3.        Limitations on Indemnification Obligations.....................................36
     Section 9.4.        Procedures Relating to Indemnification.........................................38
     Section 9.5.        Sole and Exclusive Remedy......................................................40
     Section 9.6.        Termination of Indemnification Obligations.....................................40
     Section 9.7.        Effect of Investigation........................................................40
     Section 9.8.        Tax Matters....................................................................41

ARTICLE X                TAX MATTERS....................................................................41

     Section 10.1.       Preparation and Filing of Tax Returns..........................................41
     Section 10.2.       Consistent with Past Practice..................................................41
</TABLE>


                                       ii
<PAGE>
<TABLE>
<CAPTION>
                                                                                                     Page No.
                                                                                                     --------
<S>                      <C>                                                                         <C>

     Section 10.3.       Payment of Taxes...............................................................41
     Section 10.4.       Allocation of Straddle Period Taxes............................................42
     Section 10.5.       Tax Refunds and Carrybacks.....................................................42
     Section 10.6.       Tax Indemnification............................................................43
     Section 10.7.       Notice of Indemnity............................................................44
     Section 10.8.       Payments.......................................................................44
     Section 10.9.       Tax Contests...................................................................45
     Section 10.10.      Cooperation and Exchange of Information........................................45
     Section 10.11.      Mexican Income Taxes; Customs Duties; Advanced Pricing
                         Agreement; Transfer, Sales and Use Taxes.....................................  46
     Section 10.12.      Tax Records....................................................................47
     Section 10.13.      Tax Sharing Agreements.........................................................48
     Section 10.14.      Dispute Resolution.............................................................48

ARTICLE XI               TERMINATION....................................................................48

     Section 11.1.       Voluntary Termination..........................................................48
     Section 11.2.       Automatic Termination..........................................................48
     Section 11.3.       Effect of Termination..........................................................48

ARTICLE XII              MISCELLANEOUS..................................................................49

     Section 12.1.       Assignment.....................................................................49
     Section 12.2.       Notices........................................................................49
     Section 12.3.       Choice of Law; Dispute Resolution..............................................50
     Section 12.4.       Survival of Representations and Warranties and Covenants.......................51
     Section 12.5.       Limitations on Representations and Warranties..................................51
     Section 12.6.       Entire Agreement; Waivers......................................................52
     Section 12.7.       Counterparts...................................................................52
     Section 12.8.       Severability...................................................................52
     Section 12.9.       Headings.......................................................................52
     Section 12.10.      Expenses.......................................................................52
     Section 12.11.      Amendments.....................................................................52
     Section 12.12.      Parties in Interest............................................................53
     Section 12.13.      Schedules and Exhibits.........................................................53
     Section 12.14.      Controlling Agreement..........................................................53
     Section 12.15.      Compliance with Bulk Sales Laws................................................53
     Section 12.16.      Cooperation Following the Closing..............................................53
</TABLE>


                                      iii
<PAGE>
                        MEXICAN STOCK PURCHASE AGREEMENT


         MEXICAN STOCK PURCHASE AGREEMENT (this "Agreement"), dated as of June
25, 2002, by and between Conexant Systems, Inc., a Delaware corporation
("Seller"), and Alpha Industries, Inc., a Delaware corporation ("Purchaser").
Seller and Purchaser are sometimes hereinafter collectively referred to as the
"Parties" and individually as a "Party."


                                    RECITALS

         A. Seller and Purchaser are parties to a Mexican Stock and Asset
Purchase Agreement, dated as of December 16, 2001 (the "Existing Agreement"),
pursuant to which Seller agreed to sell, and Purchaser agreed to purchase, all
of Seller's right, title and interest in and to the Shares (as defined below)
and the Assets (as defined below).

         B. Seller and Purchaser wish to amend certain provisions of the
Existing Agreement to, among other things, provide for the sale and purchase of
the Shares.

         C. Concurrently herewith, Seller and Purchaser are amending the
Existing Agreement, to, among other things, provide for the sale of the Assets
to Purchaser.

         D. Seller owns 108,096,704 shares (the "Shares") of the issued and
outstanding fixed and variable capital stock of Maquiladora (as defined herein),
which represent approximately 99.9999% of the issued and outstanding shares of
capital stock of Maquiladora; and Minority Shareholder (as defined herein) owns
the remaining 25 issued and outstanding shares ("Minority Shares" and, together
with the Shares, the "Purchased Shares") of variable capital stock of
Maquiladora.

         E. Maquiladora conducts its business from the Facility (as defined
herein) located in Mexicali, Baja California, Mexico.

         F. Seller desires to sell all of Seller's right, title and interest in
and to the Shares, and Purchaser desires to purchase the Shares, all in
accordance with the terms of this Agreement.
<PAGE>
                                    AGREEMENT

         NOW, THEREFORE, in consideration of the representations, warranties,
mutual covenants and promises contained herein and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Parties hereby agree as follows:

                                   ARTICLE I

                                   DEFINITIONS

         As used in this Agreement, the following terms shall have the meanings
given those terms in this ARTICLE I or in the Section of this Agreement
referenced in the definition provided for such term and all references to "the
date of this Agreement", "the date hereof", "a recent date" or similar
references shall refer or relate to the date as of which the Existing Agreement
was originally executed and delivered (December 16, 2001) and not the date as of
which this Agreement was amended and restated (June 25, 2002):

         "Actually Realized" shall mean, for purposes of determining the timing
of any Taxes (or related Tax cost or benefit) relating to any payment,
transaction, occurrence or event, the time at which the amount of Taxes
(including estimated Taxes) payable by any Person is increased above or reduced
below, as the case may be, the amount of Taxes that such person would be
required to pay but for the payment, transaction, occurrence or event.

         "Advanced Pricing Agreement" means the proposed transfer pricing
agreement among, Seller, Maquiladora, the United States Internal Revenue Service
and certain Mexican Tax authorities for transactions between Seller and
Maquiladora for the annual tax periods of Maquiladora commencing January 1, 2000
through January 1, 2004, which has been submitted to the United States Internal
Revenue Service and the appropriate Mexican Tax authorities.

         "Affiliate" of a Person means any other Person that, directly or
indirectly, controls, is controlled by, or is under common control with, such
Person. The term "control" (including, with correlative meaning, the terms
"controlled by" and "under common control with"), as used with respect to any
Person, means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise.


                                       2
<PAGE>
         "Agreement" is defined in the first paragraph hereof.

         "Assembly Agreement" is defined in Section 3.15(i).

         "Assets" is defined in the Mexican Asset Purchase Agreement.

         "Bailment Agreements" is defined in Section 3.15(ii).

         "Benefit Plans" is defined in Section 3.11(b).

         "Books and Records" means all documents, information, computer data,
files, books and records (in each case, in whatever form or media, including
electronic media) owned by Seller that relate to Maquiladora and its operations.

         "Business Day" means a day other than a Saturday, a Sunday or a day on
which banks are required or authorized to close in the City of New York.

         "Charter Document" means any of the certificate of incorporation,
bylaws, agreement of limited partnership, operating agreement or other
organizational or constitutive document of a Person (including, in the case of a
Mexican Person, the acta constitutiva or estatutos of such Person).

         "Claim(s)" means any action, suit, litigation, proceeding, arbitration
or other method of settling disputes or disagreements and any grievance,
complaint, claim, charge, demand, investigation or other similar matter.

         "Claims Made Policies" is defined in Section 5.9(b).

         "Closing" means the consummation of the transactions contemplated by
this Agreement on the Closing Date.

         "Closing Material Adverse Effect" means any event, change, circumstance
or development that is materially adverse to (i) the ability of Seller to
consummate the transactions contemplated by this Agreement, the Mexican Asset
Purchase Agreement and the Merger Agreement or (ii) the business, financial
condition or results of operations of Maquiladora, the business, financial
condition or results of operations of the Washington Business and the Assets
taken as a whole, other than, with respect to clause (ii), any event, change,
circumstance or development (A) resulting from any action taken in connection
with the transactions contemplated hereby pursuant to the terms of this
Agreement or the Merger Agreement, (B) relating to the economy or financial
markets in general, (C) relating in general to the industries in which Seller,
Maquiladora and the Washington Business operate and not specifically relating to
Seller, Maquiladora and the Washington Business or (D) relating to any action or
omission of Seller, Maquiladora or


                                       3
<PAGE>
Washington or any Subsidiary of any of them taken with the express prior written
consent of Purchaser.

         "Closing Date" is defined in the first paragraph of ARTICLE VIII.

         "Code" means the United States Internal Revenue Code of 1986, as
amended.

         "Consent(s)" means any and all consents, waivers, approvals,
authorizations, declarations, filings, recordings, registrations or exemptions.

         "Damages" means any and all losses, Liabilities, claims, damages,
deficiencies, obligations, fines, payments, Taxes, Encumbrances, and costs and
expenses, whether matured or unmatured, absolute or contingent, accrued or
unaccrued, liquidated or unliquidated, known or unknown, whenever arising and
whether or not resulting from Third Party Claims (including the costs and
expenses of any and all Claims; all amounts paid in connection with any demands,
assessments, judgments, settlements and compromises relating thereto; interest
and penalties with respect thereto; out-of-pocket expenses and reasonable
attorneys', accountants' and other experts' fees and expenses reasonably
incurred in investigating, preparing for or defending against any such Claims or
in asserting, preserving or enforcing an Indemnified Party's rights hereunder;
and any losses that may result from the granting of injunctive relief as a
result of any such Claims).

         "Dispute" is defined in Section 12.3(b).

         "dollars" or "U.S.$" means United States dollars.

         "Effective Time" is defined in the Merger Agreement.

         "Employee(s)" means any person employed by Maquiladora, including
persons employed on a full-time or part-time basis.

         "Encumbrance" means any lien, pledge, easement, security interest,
mortgage, deed of trust, right-of-way, retention of title agreement or other
encumbrance of whatever nature.

         "Environmental Claim" is defined in Section 3.14.

         "Environmental Law" means any law, rule or regulation applicable to the
Facility enacted as of the Closing Date issued by any Governmental Authority
that asserts authority over Maquiladora or the Assets regulating or pertaining
to protection of human health or the environment (including soil, surface
waters, ground waters, natural


                                       4
<PAGE>
resources, land, stream, sediments, surface or subsurface strata and indoor and
ambient air, or relating to the presence, spillage, discharge, release or
emission of, or contamination and damage from, Hazardous Materials, including
those (i) requiring any Permits, or the renewal thereof, (ii) regulating the
amount, form, manner or storage, transport and/or disposal of Hazardous
Materials or (iii) requiring any record keeping, reporting, inspection report or
notification regarding Hazardous Material to a Governmental Authority.

         "Existing Agreement" is defined in the recitals hereto.

         "Facility" means the Land and Improvements, including all easements,
licenses, options, insurance proceeds and condemnation awards and all other
rights of Maquiladora in or appurtenant thereto.

         "Financial Statements" means the balance sheet of Maquiladora as of
November 23, 2001 and the related statement of income of Maquiladora for the
twelve-month period ended November 23, 2001, together with the notes thereto.

         "Financing Agreement" means the Financing Agreement to be dated as of
the Closing Date among Purchaser, each of Purchaser's subsidiaries listed
therein (including, upon the Closing, Maquiladora) and Seller, substantially in
the form attached hereto as Exhibit "C".

         "Governmental Authority" means any federal, state or local governmental
authority or regulatory body of any nation (including the United States of
America and the United Mexican States ("Mexico")), any subdivision, agency,
commission, board or authority or instrumentality thereof, or any
quasi-governmental or private body asserting, exercising or empowered to assert
or exercise any regulatory authority thereunder and any Person, directly or
indirectly, owned by and subject to the control of any of the foregoing.

         "Hazardous Material" means any hazardous waste, hazardous material,
hazardous substance, petroleum product, oil, toxic substance, pollutant,
contaminant, or other substance that is regulated under any Environmental Law.

         "HSR Act" means the Hart Scott Rodino Antitrust Improvements Act of
1976, as amended.

         "Improvements" means all buildings, structures, fixtures and real
property improvements located on the Land.


                                       5
<PAGE>
         "including" means including without limiting the generality of what
precedes that term.

         "Indemnified Party" is defined in Section 9.3(a).

         "Indemnifying Party" is defined in Section 9.3(a).

         "Indemnity Issue" is defined in Section 10.7.

         "Indemnity Reduction Amounts" is defined in Section 9.3(a).

         "Information" means all records, books, contracts, instruments,
computer data and other data and information (in each case, in whatever form or
medium, including electronic media).

         "Injunction" is defined in Section 6.3

         "Insurance Proceeds" means monies (a) received by an insured from an
insurance carrier, (b) paid by an insurance carrier on behalf of an insured or
(c) received from any third party in the nature of insurance, contribution or
indemnification in respect of any Liability.

         "Land" means that certain parcel of land owned by Maquiladora commonly
known as Ave. Iqnacio Lopez Rayon No. 1699, Colonial Rivera, Mexicali, Baja
California, Mexico.

         "Law" means all laws, principals of common law, statutes,
constitutions, treaties, rules, regulations, ordinances, codes, ruling, orders
and determinations of any Governmental Authority.

         "Liabilities" means any and all claims, debts, liabilities, commitments
and obligations of whatever nature, whether fixed, contingent or absolute,
matured or unmatured, liquidated or unliquidated, accrued or not accrued, known
or unknown, due or to become due, whenever or however arising and whether or not
the same would be required by generally accepted accounting principles to be
reflected as a liability in financial statements or disclosed in the notes
thereto.

         "Maquila Decree" is defined in Section 3.6.

         "Maquiladora" means Conexant Systems, S.A. de C.V., a sociedad anonima
de capital variable organized under the laws of Mexico.

         "Maquiladora Contracts" means all agreements listed in Section 3.15.


                                       6
<PAGE>
         "Material Adverse Change" or "Material Adverse Effect" means any event,
change, circumstance or development that is materially adverse to (i) the
ability of Seller to consummate the transactions contemplated by this Agreement
or the Mexican Asset Purchase Agreement or (ii) the business, financial
condition or results of operations of Maquiladora and the Assets taken as a
whole, other than, with respect to clause (ii), any event, change, circumstance
or development (A) resulting from any action taken in connection with the
transactions contemplated hereby pursuant to the terms of this Agreement, (B)
relating to the economy or financial markets in general, (C) relating in general
to the industries in which Seller and Maquiladora operate and not specifically
relating to Seller and Maquiladora or (D) relating to any action or omission of
Seller or Maquiladora or any Subsidiary of either of them taken with the express
prior written consent of Purchaser.

         "Merger" is defined in the recitals of the Merger Agreement.

         "Merger Agreement" means the Agreement and Plan of Reorganization,
dated as of December 16, 2001, as amended as of April 12, 2002, by and among
Seller, Washington and Purchaser.

         "Mexican Asset Purchase Agreement" means the Amended and Restated
Mexican Asset Purchase Agreement, dated as of the date hereof, by and between
Seller and Purchaser.

         "Mexican Compensation Requirements" is defined in Section 3.11(a).

         "Mexican Competition Commission" means the Mexican Comision Federal de
Competencia established under Chapter IV of the Mexican Economic Competition
Law.

         "Mexican Economic Competition Law" means the Mexican Ley Federal de
Competencia Economica published in the Mexican Official Gazette (Diario Oficial
de la Federacion) on December 24, 1992.

         "Minority Purchaser" means the Person designated by Purchaser, in a
writing delivered to Seller at least two (2) Business Days prior to the Closing
Date, to purchase the Minority Shares.

         "Minority Shareholder" means Mr. Balakrishnan S. Iyer.

         "Minority Shareholder's Contrato de Compra-Venta de Acciones" is
defined in Section 8.2(ii).

         "Minority Shares" is defined in the recitals hereto.


                                       7
<PAGE>
         "Occurrence Basis Policies" is defined in Section 5.9(b).

         "Party" and "Parties" are defined in the first paragraph of this
Agreement.

         "Permits" means licenses, permits, authorizations, consents,
certificates, registrations, variances, franchises and other approvals from any
Governmental Authority, including those relating to environmental matters.

         "Permitted Encumbrance" means (i) in respect of real property,
Encumbrances consisting of zoning or planning restrictions, easements, Permits
or other restrictions or limitations on the use of real property or
irregularities in title thereto which do not materially detract from the value
of, or impair the use of, such real property as currently operated, (ii)
Encumbrances for Taxes, assessments or governmental charges or levies on
property not yet due and payable or which are being contested in good faith and
for which appropriate reserves are maintained, (iii) Encumbrances of landlords,
carriers, warehousemen, mechanics and other Encumbrances imposed by law and
incurred in the ordinary course of business, (iv) for personal property,
Encumbrances for purchase money obligations incurred in the ordinary course of
business consistent with past practice, (v) Encumbrances set forth on Schedule
2.2(b) and (vi) other Encumbrances (other than mortgages, deeds of trust, title
retention agreements or similar security interests on the Facility) which,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.

         "Person" means an individual, corporation, limited liability entity,
partnership, association, trust, unincorporated organization, other entity or
group (as defined in the Exchange Act), including any Governmental Authority.

         "Policies" means all insurance policies, insurance contracts and claim
administration contracts of any kind of Seller relating to Maquiladora which
were or are in effect at any time at or prior to the Closing, including primary,
excess and umbrella, commercial general liability, fiduciary liability, product
liability, automobile, aircraft, property and casualty, business interruption,
directors and officers liability, employment practices liability, workers'
compensation, crime, errors and omissions, special accident, cargo and employee
dishonesty insurance policies and captive insurance company arrangements,
together with all rights, benefits and privileges thereunder.

         "Privileged Information" means, with respect to a Party, Information
regarding the Party or Maquiladora, or any of its operations, employees, assets
or Liabilities (whether in documents or stored in any other form or known to its
employees or agents) that is or may be protected from disclosure pursuant to the
attorney-client privilege, the work product doctrine or other applicable
privileges, that a Party has or


                                       8
<PAGE>
may come into possession of or has obtained or may obtain access to pursuant to
this Agreement or otherwise.

         "Promissory Note" means a promissory note issued by Purchaser in favor
of Seller in a principal amount equal to the Purchase Price, substantially in
the form attached hereto as Exhibit "A".

         "Purchase Price" is defined in Section 2.2.

         "Purchased Shares" is defined in the recitals hereto.

         "Purchaser" is defined in the first paragraph of this Agreement.

         "Purchaser Indemnified Parties" is defined in Section 9.1.

         "Representative" means, with respect to any Person, any of such
Person's directors, officers, employees, agents, consultants, advisors,
accountants, attorneys and representatives.

         "Schedules" means the disclosure schedules contained in this Agreement
which schedules are attached hereto and incorporated by reference as if
specifically set forth herein.

         "SECOFI" is defined in Section 3.5.

         "Seller" is defined in the first paragraph of this Agreement.

         "Seller Indemnified Parties" is defined in Section 9.2.

         "Seller's Contrato de Compra-Venta de Acciones" is defined in Section
8.1(ii).

         "Shares" is defined in the recitals hereto.

         "Straddle Period" is defined in Section 10.1.

         "Subsidiary" when used with respect to any Person means any corporation
or other organization, whether incorporated or unincorporated, at least a
majority of the securities or other interests of which having by their terms
ordinary voting power to elect a majority of the Board of Directors or others
performing similar functions with respect to such corporation or other
organization is, directly or indirectly, owned or controlled by such Person or
by any one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries.


                                       9
<PAGE>
         "Supply Agreement" means the Supply Agreement, to be dated as of the
Closing Date, between Seller and Purchaser relating to the provision by
Purchaser to Seller of specified services and the provision by Seller to
Purchaser of other specified services, substantially on the terms attached
hereto as Exhibit "B".

         "Tax" and "Taxes" shall mean all forms of taxation, whenever created or
imposed, and whether of the United States or elsewhere, and whether imposed by a
federal, state, municipal, governmental, territorial, local, foreign or other
body, and without limiting the generality of the foregoing, shall include net
income, gross income, gross receipts, sales, use, value added, ad valorem,
transfer, recording, franchise, profits, license, lease, service, service use,
payroll, wage, withholding, employment, unemployment insurance, workers
compensation, social security, excise, severance, stamp, business license,
business organization, occupation, premium, property, environmental, windfall
profits, customs, duties, alternative minimum, estimated or other taxes, fees,
premiums, assessments or charges of any kind whatever imposed or collected by
any governmental entity or political subdivision thereof, together with any
related interest and any penalties, additions to such tax or additional amounts
imposed with respect thereto by any Tax authority.

         "Tax Proceeding" means any audit, examination, Claim or other
administrative or judicial proceeding relating to Taxes or Tax Returns.

         "Tax Return" shall mean any return, filing, questionnaire, information
return, election or other document required or permitted to be filed, including
requests for extensions of time, filings made with respect to estimated tax
payments, claims for refund and amended returns that may be filed, for any
period with any Tax authority (whether domestic or foreign) in connection with
any Tax (whether or not a payment is required to be made with respect to such
filing).

         "Third Party Claim" is defined in Section 9.4(a).

         "To the knowledge of Seller" or words of similar import with respect to
a fact or matter means the actual knowledge of the executive officers of Seller
listed on Schedule 1 after reasonable inquiry.

         "Transition Services Agreement" means the Transition Services Agreement
to be entered into between Seller and Purchaser on or prior to the Closing Date,
relating to the provision by Purchaser to Seller of specified services.

         "U.S. Asset Purchase Agreement" means the U.S. Asset Purchase
Agreement, dated December 16, 2001, by and between Seller and Purchaser, as may
be amended, modified or supplemented from time to time.


                                       10
<PAGE>
         "U.S. GAAP" means generally accepted accounting principles as applied
in the United States as of the date of this Agreement.

         "Washington" means Washington Sub, Inc., a Delaware corporation.

         "Washington Business" is defined in the Merger Agreement.

                                   ARTICLE II

                           SALE AND PURCHASE OF STOCK

         Section 2.1. Purchase and Sale of Shares and Minority Shares.

         (a) Purchase and Sale of Shares. At the Closing, Seller shall sell,
transfer, convey, assign and deliver to Purchaser, and Purchaser shall purchase,
acquire and accept, the Shares, free and clear of any Encumbrances.

         (b) Purchase and Sale of Minority Shares. At the Closing, Seller shall
cause Minority Shareholder to sell, transfer, convey, assign and deliver to
Minority Purchaser, and Purchaser shall cause Minority Purchaser to purchase,
acquire and accept, the Minority Shares, free and clear of any Encumbrances.

         Section 2.2. Purchase Price. The purchase price (the "Purchase Price")
to be paid in the aggregate by Purchaser to Seller in consideration for the
Shares and the Minority Shares shall be nineteen million one hundred ten
thousand dollars (U.S.$19,110,000), payable, at the election of Purchaser,
either (A) by wire transfer of immediately available funds at the Closing or (B)
by delivery of the Promissory Note at the Closing; provided, however, that if
Purchaser shall elect to pay the Purchase Price pursuant to clause (B),
Purchaser shall provide written notice of such election to Seller no later than
thirty (30) days prior to the Closing Date.

         Section 2.3. Liabilities of Maquiladora. Purchaser acknowledges that
subsequent to the Closing, except as specifically provided in Article X,
Maquiladora will retain and be responsible for all Liabilities and obligations
of Maquiladora, including any and all Liabilities or obligations that relate
back to events prior to the Closing Date.


                                       11
<PAGE>
                                  ARTICLE III

                     SELLER'S REPRESENTATIONS AND WARRANTIES

         Seller hereby represents and warrants to Purchaser as of the date
hereof and as of the Closing Date the following:

         Section 3.1. Corporate Status, Good Standing and Authorization. Seller
is a corporation duly incorporated, validly existing and in good standing under
the laws of its jurisdiction of incorporation, with all requisite corporate
power and authority to own the Shares, except where the failure to have such
power and authority, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect. Maquiladora is a sociedad anonima de
capital variable duly incorporated and validly existing under the law of its
jurisdiction of incorporation, with all requisite corporate power and authority
to own and lease its properties and to conduct its business as presently
conducted, except where the failure to have such power and authority,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect. Seller and Maquiladora are each duly licensed or
qualified to do business as a foreign corporation in all states or jurisdictions
in which the nature of its business requires such license or qualification,
except where the failure to be so licensed or qualified, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.
Seller has heretofore delivered to Purchaser complete and correct copies of
Maquiladora's Charter Documents.

         Section 3.2. Authority; Enforceability. Seller has all requisite
corporate power and authority to enter into this Agreement and perform its
obligations under this Agreement. The execution, delivery and performance of
this Agreement by Seller and the consummation by Seller of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the part of Seller. This Agreement has been duly authorized, executed and
delivered by Seller and is a legally valid and binding obligation of Seller
(assuming that this Agreement constitutes the valid and binding obligation of
Purchaser) and is enforceable against Seller in accordance with its terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium and similar Laws relating to
or affecting creditors generally or by general equity principles (regardless of
whether such enforceability is considered in a proceeding in equity or at law).

         Section 3.3. Consents; No Conflicts or Violations. Except for the
Consents set forth on Schedule 3.3 and Consents which if not obtained and
maintained by Seller, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect, there are no Consents of any
Governmental Authority required


                                       12
<PAGE>
in connection with (i) Seller's execution and delivery of this Agreement and the
other agreements, documents and instruments to be executed and delivered by
Seller in connection herewith or (ii) the performance by Seller of its
obligations herein or therein or the consummation by Seller of the transactions
contemplated hereby or thereby. Assuming receipt of all of the Consents set
forth on Schedule 3.3 (including any required HSR Act approval, any approval
required by the Mexican Competition Commission under the Mexican Economic
Competition Law and any approval by SECOFI (as defined below) of any change of
any Permits held by Maquiladora), neither the execution or delivery by Seller of
this Agreement nor the consummation by Seller of the transactions contemplated
hereby will, with or without the giving of notice or the lapse of time or both,
conflict with or result in a breach or violation of or give rise to a default or
right of termination, amendment, cancellation or acceleration under (i) any
provision of Seller's or Maquiladora's Charter Documents, (ii) any contract,
agreement, note, bond, mortgage, indenture, lease, license, franchise, permit,
concession, instrument or obligation to which Seller or Maquiladora is a party
or by which any of their respective properties or assets are bound or (iii) any
Law or license or other requirement to which Seller or Maquiladora or their
respective properties or assets is subject, except, in the case of items (ii)
and (iii) above only, for those which, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect.

         Section 3.4. Stock of Maquiladora. Maquiladora's Charter Documents
authorize the issuance of 8,750 shares of fixed capital stock and an unlimited
number of shares of variable capital stock, P$1.00 Mexican Pesos par value, of
which 8,750 shares of fixed capital stock and 108,087,979 shares of variable
capital stock are issued and outstanding. Seller owns directly 8,725 shares of
fixed capital stock and 108,087,979 shares of variable capital stock and
Minority Shareholder owns directly 25 shares of fixed capital stock of
Maquiladora. All of the capital stock of Maquiladora has been duly authorized
and is validly issued, fully paid and nonassessable and is owned by Seller and
Minority Shareholder free and clear of all Encumbrances. There are no
outstanding subscriptions, options, warrants, preemptive or contractual rights,
voting trusts, privileges or any agreements to acquire any shares of capital
stock of Maquiladora, or any securities or obligations of any kind convertible
or exchangeable into any class of capital stock of Maquiladora. Maquiladora has
no Subsidiaries and does not own any shares of capital stock or any other
securities of any corporation and does not have any equity interest in any other
Person.

         Section 3.5. Permits. Seller and Maquiladora have or will have as of
the Closing all Permits which are required in order to allow Seller to own the
Shares or which are required in order to allow Maquiladora to own its assets and
properties and to conduct its business as conducted as of the date hereof,
including all Permits required from the Mexican Ministry of Commerce and
Industrial Promotion ("SECOFI") or its successor, the Mexican Ministry of the
Economy, except, in any such case, for such


                                       13
<PAGE>
Permits, which if not obtained or maintained, individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect. Each of
Seller and Maquiladora is and will be in compliance with each such Permit,
except where the failure to so comply, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect. No suspension or
cancellation of any such Permits is or will be pending or, to the knowledge of
Seller, threatened, except for suspensions or cancellations which, individually
or in the aggregate, would not reasonably be expected to have a Material Adverse
Effect. Seller will have delivered to Purchaser at or prior to Closing a list of
all such Permits held or obtained as of the Closing Date, except for such
Permits, which if not held or obtained, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect.

         Section 3.6. Compliance with Laws. Except as disclosed on Schedule 3.6,
(i) Maquiladora is in compliance in all material respects with all applicable
Laws, including the Decree for the Development and Operation of Maquiladora
Export Industry, as amended (the "Maquila Decree"), (ii) Seller is in compliance
in all material respects with all Laws applicable with respect to the Shares,
except in the case of (i) or (ii) above, where the failure to so comply,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect, and (iii) to the knowledge of Seller, Maquiladora has
not received within the past twelve (12) months any written notice or
correspondence from any Governmental Authority to the effect that it is not in
compliance with any such applicable Laws, except for such violations which,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.

         Section 3.7. Financial Statements. Annexed hereto as Schedule 3.7 are
true and correct copies of the Financial Statements. The Financial Statements
fairly present the tangible assets and liabilities of Maquiladora in all
material respects as of November 23, 2001 and the results of operations for the
period indicated. Except as set forth on Schedule 3.7, since November 23, 2001,
Maquiladora has not incurred any liabilities that are of a nature that would be
required to be disclosed on a statement of assets and liabilities of Maquiladora
or in the footnotes thereto prepared in conformity with U.S. GAAP, other than
liabilities incurred in the ordinary course of business or that, individually or
in the aggregate, would not reasonably be expected to have a Material Adverse
Effect.

         Section 3.8. Absence of Certain Changes or Events. Except as set forth
on Schedule 3.8, since November 23, 2001, there has not been any Material
Adverse Change or any event, change, circumstance or development which,
individually or in the aggregate, would reasonably be expected to have a
Material Adverse Change. Without limiting the generality of the foregoing,
except as set forth on Schedule 3.8, Maquiladora


                                       14
<PAGE>
has been operated since November 23, 2001 in the ordinary course of business
consistent with past practice (except as may be expressly contemplated by this
Agreement).

         Section 3.9. Facility.

         (a) Facility. Maquiladora owns good and marketable title to the
Facility, free and clear of any Encumbrances, except for Permitted Encumbrances.
To Seller's knowledge, there are no condemnation actions pending against the
Facility. There are no material leases, licenses, concessions or occupancy
agreements affecting the Facility. No interest of Seller or Maquiladora in the
Facility is subject to any right of first refusal or right or option to
purchase, lease or license the Facility or any portion therein.

         (b) Zoning. Neither Seller nor, to the knowledge of Seller, Maquiladora
has received notification or correspondence within the past twelve (12) months
that it is in violation of any applicable building, zoning, health or other law,
ordinance or regulation in respect to its stores, plants or structures or their
operations of the Facility, except for such violations that, individually or in
the aggregate, would not reasonably be expected to have a Material Adverse
Effect.

         Section 3.10. Litigation. Except as set forth on Schedule 3.10, there
is no action, suit or proceeding or regulatory investigation pending or, to the
knowledge of Seller, threatened against Seller, Minority Shareholder or
Maquiladora or its business or operations affecting (i) Maquiladora or its
business or operations, (ii) the Purchased Shares or (iii) this Agreement before
any court or arbitrator or any governmental body, agency or official, except for
those which, if adversely determined, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect. None of Seller,
Minority Shareholder or Maquiladora is a party to or subject to any judgment,
order, rule, writ, injunction, or decree of any Governmental Authority or
arbitrator which relates to or affects Maquiladora or the Purchased Shares,
except as, individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect.

         Section 3.11. Maquiladora Employee Matters.

         (a) Maquiladora Employees; Mexican Compensation Requirements. Schedule
3.11(a) contains a list of all current Employees of Maquiladora as of the date
hereof. To the knowledge of Seller, Maquiladora is in compliance with all
Mexican laws, rules and regulations with respect to severance, profit-sharing,
Christmas bonus, vacation pay, vacation bonus, retirement, pension and other
employee benefit matters (collectively "Mexican Compensation Requirements")
applicable to its current and former Employees, except where the failure to so
comply, individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect.


                                       15
<PAGE>
         (b) Benefit Plans. Schedule 3.11(b) lists all material employee pension
benefit plans, employee welfare benefit plans, bonus, stock option, stock
purchase, other equity compensation, deferred compensation, incentive
compensation, severance, employee assistance plans and other employee fringe
benefit plans (collectively, the "Benefit Plans") maintained, or contributed to,
by Maquiladora or Seller for the benefit of any present or former Employees
except for those Benefit Plans (i) required by any Mexican Governmental
Authority and (ii) providing de minimis benefits.

         (c) Compliance. To the knowledge of Seller, all employer and employee
contributions to each Benefit Plan required by the terms of such Benefit Plan
have been made, or, if applicable, accrued, in accordance with Seller's normal
accounting practices.

         Section 3.12. Maquiladora Labor Relations. Except as stated on Schedule
3.12, Maquiladora is not a signatory to any collective bargaining agreement with
any trade union or labor organization. Except as, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect,
(i) to the knowledge of Seller, Maquiladora is not engaged in any unfair labor
practice, (ii) there is no pending labor board proceeding of any kind with
respect to Maquiladora and (iii) no walk out, strike or work stoppage by the
Employees is in progress nor, to the knowledge of Seller, has notice of any such
walk out, strike or work stoppage been filed or received by Maquiladora within
the past twelve (12) months.

         Section 3.13. Tax Matters.

         (a) Tax Returns. All material Tax Returns required to be filed by
Maquiladora have been timely filed. All such Tax Returns are true, correct and
complete, except as, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect. All Taxes shown as due and payable
by or with respect to such Tax Returns have been timely paid in full.

         (b) No Tax Proceedings. Except as set forth on Schedule 3.13(b), there
are no Tax Proceedings presently pending with regard to any Tax Returns or Taxes
of Maquiladora, and no notice has been received from any Governmental Authority
of the expected commencement of such a Tax Proceeding.

         (c) No Tax Liens. There are no Encumbrances for any Tax on the assets
of Maquiladora, except for Permitted Encumbrances.

         (d) No Consolidated Filings. Seller has not made an election under Code
Section 1504(d) to treat Maquiladora as a member of Seller's affiliated group of


                                       16
<PAGE>
corporations filing a consolidated income tax return for United States income
Tax purposes. No liability has been asserted against Maquiladora with respect to
Taxes of any affiliated group within the meaning of Section 1504(a) of the Code
of which Maquiladora has been a member.

         (e) No Tax Liability. No liability has been asserted against
Maquiladora with respect to Taxes of any other Person pursuant to any Tax
allocation or sharing agreement with any such Person, or any agreement to
indemnify any such Person with respect to Taxes.

         (f) Tax Audits. Schedule 3.13(f) sets forth all income Tax Returns of
Maquiladora that are under audit by the relevant taxing authority.

         (g) No Trade or Business. Maquiladora is not engaged in the conduct of
a "trade or business within the United States" within the meaning of Code
Section 864(b).

         (h) IRC Code Sections 956, 956A. Maquiladora does not have any of
its earnings invested in United States property within the meaning of Code
Section 956 and does not have "excess passive assets" within the meaning of Code
Section 956A.

         Section 3.14. Environmental Matters. Except as disclosed on Schedule
3.14 and except as, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect, (i) Maquiladora and the Facility
comply with all Environmental Laws, (ii) Maquiladora and the Facility are not
subject to any action, cause of action, or other proceeding alleging the
violation of any Environmental Law or relating to the presence, or release into
the environment, of any Hazardous Material (collectively, "Environmental
Claim"), (iii) Maquiladora has not received any notice or claim (A) that it is
or has been in violation (or potential violation) of any Environmental Law or
(B) alleging that Maquiladora is or may be responsible for any response,
cleanup, or corrective action, including any remedial investigation/feasibility
studies, under any Environmental Law, which notice is not resolved or otherwise
remains pending, (iv) to Seller's knowledge, Maquiladora and the Facility are
not the subject of any investigation by a Governmental Authority pursuant to an
Environmental Law evaluating whether any remedial action or other response is
needed to respond to spillage, disposal or release or threatened release into
the environment of any Hazardous Material, (v) Maquiladora has not filed any
notice under or relating to any such Environmental Law indicating or reporting
any past or present spillage, disposal or release into the environment of, or
treatment, storage or disposal of, any Hazardous Material which spill, release,
treatment, storage or disposal has not been performed and/or addressed in
accordance with Environmental Laws and (vi) to the knowledge of Seller as of the
date hereof, there has been no release of Hazardous Materials at the Facility
that would be reasonably likely to


                                       17
<PAGE>
form the basis of any Environmental Claim against Maquiladora. The
representations and warranties in this Section 3.14 constitute the sole
representations and warranties of Seller concerning environmental matters in
this Agreement.

         Section 3.15. Material Contracts of Maquiladora. Schedule 3.15 sets
forth all of the following written agreements, commitments or contracts of
Maquiladora as of the date of this Agreement (collectively, the "Maquiladora
Contracts"):

                  (i) the assembly agreement with Seller whereby Seller
         transfers raw materials, components, parts and other inputs to
         Maquiladora and Maquiladora assembles, tests and ships finished
         products to Seller (the "Assembly Agreement");

                  (ii) all gratuitous bailment agreements with Seller whereby
         Seller gratuitously transfers equipment, machinery, tools and other
         similar capital equipment to be used by Maquiladora to assemble and
         test products (the "Bailment Agreements");

                  (iii) all agreements evidencing indebtedness for borrowed
         money in an amount in excess of two hundred fifty thousand dollars
         (U.S.$250,000) and all instruments constituting guarantees, sureties or
         indemnities of obligations of third parties in an amount in excess of
         two hundred fifty thousand dollars (U.S.$250,000);

                  (iv) all agreements restricting Maquiladora from conducting
         any business in any geographic location;

                  (v) all agreements for construction of improvements on the
         Facility in excess of two hundred fifty thousand dollars
         (U.S.$250,000), individually, or five hundred thousand dollars
         (U.S.$500,000), in the aggregate;

                  (vi) all agreements for the purchase, sale or lease of capital
         assets in excess of one hundred thousand dollars (U.S.$100,000),
         individually, or five hundred thousand dollars (U.S.$500,000), in the
         aggregate;

                  (vii) all agreements under which termination, severance or
         change in control payments may result due to a change of control of
         Maquiladora in an amount in excess of fifty thousand dollars
         (U.S.$50,000);

                  (viii) all agreements for the purchase or sale of any business
         or any division, material assets or operating unit thereof;


                                       18


<PAGE>

                  (ix) all agreements with individual Employees providing for
         payment in excess of fifty thousand dollars (U.S.$50,000) in any given
         year;

                  (x) all powers of attorney granted by Maquiladora;

                  (xi) all agreements evidencing loans made by Maquiladora to
         any Person, other than Employee advances in the ordinary course of
         business consistent with past practice or loans made to Affiliates;

                  (xii) all agreements committing Maquiladora to use the
         services of any vendor, supplier, licensor or licensee providing for
         payments in excess of five hundred thousand dollars (U.S.$500,000) in
         any given year; and

                  (xiii) all agreements (other than as set forth in (i)-(xii)
         above) that are not cancelable by Seller on notice of ninety (90)
         calendar days or less, without any material liability, penalty or
         premium or acceleration of any material benefits, and which require
         payment by Seller after the date hereof of more than five hundred
         thousand dollars (U.S.$500,000) in any given year.

                  True and correct copies of all Maquiladora Contracts have been
made available to Purchaser. None of Maquiladora or, to the knowledge of Seller,
any other party to any Maquiladora Contract, is in default under any Maquiladora
Contract, except for such defaults that, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect. To the knowledge
of Seller, no event has occurred with respect to any Maquiladora Contract which,
with the lapse of time or the giving of notice or both, would constitute a
default or give rise to any right of termination, amendment, cancellation or
acceleration under any Maquiladora Contract, except for such as, individually or
in the aggregate, would not reasonably be expected to have a Material Adverse
Effect.

                  Section 3.16. No Brokers. Neither this Agreement nor the sale
of the Shares or the Minority Shares was induced or procured through any Person
acting on behalf of or representing Seller and no commissions or any other
payment is due to any intermediary in connection therewith.

                  Section 3.17. Title to Properties. Maquiladora has good and
valid title to all of its tangible properties and assets, except, in each case,
where the failure to have such good and valid title, or valid leasehold
interest, would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.

                  Section 3.18. Insurance. Seller maintains insurance coverage
in respect of Maquiladora with reputable insurers in such amounts and covering
such risks as is


                                       19
<PAGE>
deemed reasonably appropriate for its business (taking into account the cost and
availability of such insurance).

                  Section 3.19. Separate Tax Parcel. To the knowledge of Seller,
the Facility is designated as one or more separate tax parcels.

                  Section 3.20. Utilities, etc. The Facility has rights of
access to public ways and is served by water, sewer, sanitary sewer and storm
drain facilities adequate to service the Facility for its current uses.


                                   ARTICLE IV

                   PURCHASER'S REPRESENTATIONS AND WARRANTIES


                  Purchaser hereby represents and warrants to Seller as of the
date hereof and as of the Closing Date the following:

                  Section 4.1. Organization of Purchaser. Purchaser is a
corporation duly incorporated, validly existing and in good standing under the
laws of its jurisdiction of incorporation.

                  Section 4.2. Authority; Enforceability. Purchaser has all
requisite corporate power and authority to enter into this Agreement and perform
its obligations under this Agreement. The execution, delivery and performance of
this Agreement by Purchaser and the consummation by Purchaser of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of Purchaser. This Agreement has been duly
authorized, executed and delivered by Purchaser and is a legally valid and
binding obligation of Purchaser (assuming that this Agreement constitutes the
valid and binding obligation of Seller) and is enforceable against Purchaser in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and
similar Laws relating to or affecting creditors generally or by general equity
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law).

                  Section 4.3. Consents; No Conflicts or Violations. Except for
the Consents set forth on Schedule 4.3 and the Consents which if not obtained
and maintained by Purchaser, individually or in the aggregate, would not
reasonably be expected to have a material adverse effect on Purchaser's ability
to consummate the transactions contemplated by this Agreement, there are no
Consents of any Governmental Authorities required in connection with (i)
Purchaser's execution and delivery of this


                                       20
<PAGE>
Agreement and the other agreements, documents and instruments to be executed and
delivered by Purchaser in connection herewith or (ii) the performance by
Purchaser of its obligations herein or therein or the consummation by Seller of
the transactions contemplated hereby or thereby. Assuming receipt of all of the
Consents set forth on Schedule 4.3 (including, any required HSR Act approval and
any approval required by the Mexican Competition Commission under the Mexican
Economic Competition Law), neither the execution or delivery by Purchaser of
this Agreement nor the consummation by Purchaser of the transactions
contemplated hereby will, with or without the giving of notice or the lapse of
time or both, conflict with or result in a breach or violation of or give rise
to a default or right of termination, amendment, cancellation or acceleration
under (i) any provision of Purchaser's Charter Documents, (ii) any material
contract, agreement, note, bond, mortgage, indenture, lease, license, franchise,
permit, concession, instrument or obligation to which Purchaser is a party or by
which any of its properties or assets are bound or (iii) any Law or license or
other requirement to which Purchaser or its properties or assets is subject,
except, in the case of items (ii) and (iii) above only, for those which,
individually or in the aggregate, would not reasonably be expected to have a
material adverse effect on Purchaser's ability to consummate the transactions
contemplated by this Agreement.

                  Section 4.4. Litigation. Except as set forth on Schedule 4.4,
there is no action, suit or proceeding or regulatory investigation pending or,
to the knowledge of Purchaser, threatened against Purchaser or Minority
Purchaser affecting this Agreement before any court or arbitrator or any
governmental body, agency or official, except for those which, if adversely
determined, individually or in the aggregate, would not reasonably be expected
to have a material adverse effect on Purchaser's ability to consummate the
transactions contemplated by this Agreement. Neither Purchaser nor Minority
Purchaser is a party to or subject to any judgment, order, writ, injunction, or
decree of any Governmental Authority or arbitrator, except as, individually or
in the aggregate, would not reasonably be expected to have a material adverse
effect on Purchaser's ability to consummate the transactions contemplated by
this Agreement.

                  Section 4.5. No Brokers. Neither this Agreement nor the
purchase of the Shares or the Minority Shares was induced or procured through
any Person acting on behalf of or representing Purchaser and no commissions or
any other payment is due to any intermediary in connection therewith.


                                       21
<PAGE>
                                    ARTICLE V

                                    COVENANTS


                  The Parties hereby covenant as follows:

                  Section 5.1. Access.

                  (a) Access to Information by Purchaser Prior to Closing. Prior
to Closing, subject to compliance with applicable laws, Seller and Maquiladora
shall, upon reasonable request, afford to Purchaser and its Representatives
reasonable access during normal business hours to all Books and Records and all
books and records of Maquiladora. Purchaser shall coordinate its requests and
activities under this Section 5.1 with Seller's need for security and will
assist Seller in minimizing disruption to Maquiladora's normal business
operations.

                  (b) Access to Information by Purchaser After Closing. From and
after the Closing, Seller will afford to Purchaser and its Representatives (at
Purchaser's expense) reasonable access and duplicating rights during normal
business hours and upon reasonable advance notice to all Books and Records and
all books and records within Seller's possession or control relating to
Maquiladora, insofar as such access is reasonably required by Purchaser.

                  (c) Access to Books and Records by Seller. Purchaser shall,
following the Closing, give Seller and its Representatives such access, during
normal business hours and upon reasonable prior notice, to the Books and
Records, the books and records of Maquiladora relating to periods prior to the
Closing and such other documents as shall be reasonably necessary for Seller in
connection with its performance of its obligations hereunder and for any other
reasonable purposes, and Purchaser will allow Seller and its Representatives to
make extracts and copies thereof as may be necessary for such purposes at
Seller's expense. Purchaser shall preserve and protect the Books and Records and
the books and records of Maquiladora relating to periods prior to the Closing in
its possession and control for the period required by the applicable records
retention policy of Seller in effect immediately prior to the Closing. Purchaser
shall offer to deliver the Books and Records and the books and records of
Maquiladora relating to periods prior to the Closing to Seller prior to their
destruction or other disposition.

                  (d) Production of Witnesses. Subject to Section 5.1(e), after
the Closing, each Party will, and Purchaser will cause Maquiladora to, make
available to the other Party, upon written request and at the cost and expense
of the Party so requesting, its directors, officers, employees and agents as
witnesses to the extent that any such Person may reasonably be required (giving
consideration to business demands of such


                                       22
<PAGE>
directors, officers, employees and agents) in connection with any Claims or
administrative or other proceedings in which the requesting party may from time
to time be involved and relating to Maquiladora's business or operations prior
to the Closing or arising in connection with the relationship between the
Parties and/or Maquiladora on or prior to the Closing Date, provided that the
same shall not unreasonably interfere with the conduct of business by the Party
of which the request is made.

                  (e) Confidentiality. From and after the Closing, each of
Seller and Purchaser shall hold, and shall use reasonable efforts to cause its
Affiliates and Representatives to hold, in strict confidence all Information
concerning the other Party or Maquiladora in its possession or control prior to
the Closing or furnished to it by another Party pursuant to the Merger and the
transactions contemplated thereby and will not release or disclose such
Information to any other Person, except its Affiliates and its and their
Representatives, who will be bound by the provisions of this Section 5.1(e);
provided, however, that any Person may disclose such Information to the extent
that (a) disclosure is compelled by judicial or administrative process or, in
the opinion of such Person's counsel, by other requirements of law (in which
case the Party required to make such disclosure will notify the other Party as
soon as practicable of such obligation or requirement and cooperate with the
other Party to limit the Information required to be disclosed and to obtain a
protective order or other appropriate remedy with respect to the Information
ultimately disclosed) or (b) such Person can show that such Information was (i)
available to such Person on a nonconfidential basis (other than from a Party)
prior to its disclosure by such Person, (ii) in the public domain through no
fault of such Person or (iii) lawfully acquired by such Person from another
source after the time that it was furnished to such Person by the other Party or
its Affiliates, Representatives or Subsidiaries, and not acquired from such
source subject to any confidentiality obligation on the part of such source
known to the acquiror, or on the part of the acquiror. Each Party acknowledges
that it will be liable for any breach of this Section 5.1(e) by its Affiliates,
Representatives and Subsidiaries. Notwithstanding the foregoing, each Party will
be deemed to have satisfied its obligations under this Section 5.1(e) with
respect to any Information (other than Privileged Information) if it exercises
the same care with regard to such Information as it takes to preserve
confidentiality for its own similar Information.

                  Section 5.2. Reasonable Best Efforts.

                  (a) Subject to the terms and conditions of this Agreement,
each Party will use its reasonable best efforts to take, or cause to be taken,
all actions and to do, or cause to be done, and to assist and cooperate with the
other Party in doing or causing to be done, all things necessary, proper or
advisable under this Agreement and applicable laws to consummate the
transactions contemplated by this Agreement as soon as practicable after the
date hereof, including (i) taking all reasonable actions to cause the


                                       23
<PAGE>
conditions set forth in ARTICLES VI and VII to be satisfied as promptly as
practicable, (ii) preparing and filing as promptly as practicable all
documentation to obtain as promptly as practicable all Consents set forth on
Schedules 3.3 and 4.3 and (iii) taking all reasonable steps as may be necessary
to obtain all Consents set forth on Schedules 3.3 and 4.3. In furtherance and
not in limitation of the foregoing, each Party hereto agrees to make (i) an
appropriate filing (if applicable) of a Notification and Report Form pursuant to
the HSR Act and any comparable filings (if applicable) pursuant to the Mexican
Economic Competition Act with respect to the transactions contemplated hereby as
promptly as practicable after the date hereof and (ii) all other necessary
filings with other Governmental Authorities relating to the transactions
contemplated herein, and, in each case, to supply as promptly as practicable any
additional information and documentary material that may be requested pursuant
to such applicable laws or by such Governmental Authorities and to use
reasonable best efforts to cause the expiration or termination of the applicable
waiting periods under the HSR Act and the Mexican Economic Competition Act and
the receipt of the Consents set forth on Schedules 3.3 and 4.3 under such other
applicable laws or from such Governmental Authorities as soon as practicable.

                  (b) Each of Seller and Purchaser shall, in connection with the
efforts referenced in Section 5.2(a) to obtain all Consents set forth on
Schedules 3.3 and 4.3, use its reasonable best efforts to (i) cooperate in all
respects with each other in connection with any filing or submission and in
connection with any investigation or other inquiry, including any proceeding
initiated by a private party, (ii) promptly inform the other Party of any
communication received by such Party from, or given by such Party to, the
Antitrust Division of the Department of Justice (the "DOJ"), the Federal Trade
Commission (the "FTC"), the Mexican Competition Commission or any other
Governmental Authority and of any material communication received or given in
connection with any proceeding by a private party, in each case regarding any of
the transactions contemplated hereby, and (iii) permit the other Party to review
any communication given by it to, and consult with each other in advance of any
meeting or conference with, the DOJ, the FTC, the Mexican Competition Commission
or any such other Governmental Authority or, in connection with any proceeding
by a private party, with any other Person, and to the extent appropriate or
permitted by the DOJ, the FTC, the Mexican Competition Commission or such other
applicable Governmental Authority or other Person, give the other Party the
opportunity to attend and participate in such meetings and conferences.

                  (c) In furtherance and not in limitation of the covenants of
the Parties contained in Section 5.2(a) and Section 5.2(b), if any
administrative or judicial action or proceeding, including any proceeding by a
private party, is instituted (or threatened to be instituted) challenging any
transaction contemplated by this Agreement as violative of any applicable laws,
or if any statute, rule, regulation, executive order, decree, injunction or
administrative order is enacted, entered, promulgated or enforced by a
Governmental


                                       24
<PAGE>
Authority which would make transactions contemplated hereby illegal or would
otherwise prohibit or materially impair or delay the consummation of the
transactions contemplated hereby, each of the Parties shall cooperate in all
respects with each other and use its respective reasonable best efforts to
contest and resist any such action or proceeding and to have vacated, lifted,
reversed or overturned any decree, judgment, injunction or other order, whether
temporary, preliminary or permanent, that is in effect and that prohibits,
prevents or restricts consummation of the transactions contemplated by this
Agreement and to have such statute, rule, regulation, executive order, decree,
injunction or administrative order repealed, rescinded or made inapplicable so
as to permit the consummation of the transactions contemplated by this
Agreement.

                  (d) Notwithstanding the foregoing or any other provision of
this Agreement, nothing in this Section 5.2 shall create an obligation by the
Parties to take any action in addition to the actions required to be taken
pursuant to the Merger Agreement to consummate the Merger.

                  Section 5.3. Conduct of Business by Seller and Maquiladora.
From the date hereof until the Closing Date, Seller shall (and shall cause
Maquiladora to), except as expressly required or permitted by this Agreement and
except as otherwise consented to in writing by Purchaser:

                  (i) conduct the business and operations of Maquiladora in the
         ordinary course of business consistent with past practice, subject to
         Maquiladora's right to declare and pay cash dividends to its
         stockholders in respect of its capital stock prior to the Closing in
         accordance with applicable Law;

                  (ii) not engage Maquiladora in any new material line of
         business;

                  (iii) use its commercially reasonable efforts to preserve
         intact the business organization of Maquiladora and preserve the
         relationships of Maquiladora with its suppliers and others having
         business relations with Maquiladora;

                  (iv) maintain Maquiladora's existence in Mexico;

                  (v) not amend or modify Maquiladora's Charter Documents in any
         material respects;

                  (vi) not permit Maquiladora to declare, pay or set aside for
         payment any dividend or other distribution to its stockholders in
         respect of its capital stock, other than the declaration and payment of
         cash dividends by Maquiladora to its


                                       25
<PAGE>
         stockholders in respect of its capital stock prior to the Closing in
         accordance with applicable Law;

                  (vii) not permit Maquiladora to create any subsidiary, acquire
         any capital stock or other equity securities of any corporation or
         acquire any equity or ownership interest in any business or entity;

                  (viii) not (A) permit Maquiladora to grant, create, incur, or
         suffer to exist any Encumbrance (other than a Permitted Encumbrance
         granted, created, incurred or suffered to exist in the ordinary course
         of business consistent with past practice) on the assets of Maquiladora
         which did not exist on the date hereof or (B) permit Maquiladora to
         create, incur or assume any indebtedness for borrowed money (other than
         indebtedness to Affiliates);

                  (ix) not permit Maquiladora to increase in any manner the base
         compensation of, or enter into any new bonus or incentive agreement or
         arrangement with, any Employees, directors or consultants other than in
         the ordinary course of business consistent with past practice;

                  (x) not permit Maquiladora to adopt or amend any Benefit Plan
         or to increase the benefits provided under any Benefit Plan other than
         in the ordinary course of business consistent with past practice;

                  (xi) not permit Maquiladora to make any material Tax election
         or settle or compromise any material Tax liability, other than in the
         ordinary course of business consistent with past practice or in
         accordance with Section 10.11(c) of this Agreement; and

                  (xii) not authorize, or commit or agree to take, any of the
         foregoing actions.

                  Section 5.4. Elimination of Intercompany Accounts. Except as
set forth on Schedule 5.4, Seller (on behalf of itself and each of its
Subsidiaries, other than Maquiladora), on the one hand, and Maquiladora, on the
other hand, shall settle and eliminate, by cancellation or transfer to the other
(in a manner to be determined by Seller), effective as of the Closing, all
intercompany receivables, payables and other balances existing immediately prior
to the Closing between Seller and/or any of Seller's Subsidiaries (other than
Maquiladora), on the one hand, and Maquiladora, on the other hand. This Section
5.4 shall not affect any rights of any Party arising under this Agreement or any
document, agreement or instrument entered into pursuant hereto.


                                       26
<PAGE>
                  Section 5.5. Intercompany Agreements. Effective as of the
Closing, Seller and Maquiladora shall terminate (and, in the case of Seller,
Seller shall cause all of Seller's Subsidiaries to terminate) all agreements
between Seller and/or any of Seller's Subsidiaries, on the one hand, and
Maquiladora, on the other hand, including the Assembly Agreement and the
Bailment Agreements. This Section 5.5 shall not affect any rights of any Party
arising under this Agreement or any document, agreement or instrument entered
into pursuant hereto.

                  Section 5.6. Mutual Release. Effective as of the Closing and
except as otherwise specifically set forth in this Agreement, each of Seller, on
behalf of itself and each of Seller's Subsidiaries (other than Maquiladora), on
the one hand, shall, and Seller shall cause Maquiladora, on the other hand, to,
release and forever discharge the other Party and its Subsidiaries, and its and
their respective officers, directors, agents, record and beneficial security
holders (including trustees and beneficiaries of trusts holding such
securities), advisors and Representatives (in each case, in their respective
capacities as such) and their respective heirs, executors, administrators,
successors and assigns, of and from all debts, demands, actions, causes of
action, suits, accounts, covenants, contracts, agreements, damages, claims and
Liabilities whatsoever of every name and nature, both in law and in equity,
which the releasing party has or ever had or ever will have, which arise out of
or relate to events, circumstances or actions taken by such other party
occurring or failing to occur or any conditions existing at or prior to the
Closing; provided, however, that the foregoing general release shall not apply
to (i) any Liabilities or other obligations (including Liabilities with respect
to payment, reimbursement, indemnification or contribution) under this Agreement
or any other document, agreement or instrument entered into pursuant to this
Agreement or assumed, transferred, assigned, allocated or arising under this
Agreement or any other document, agreement or instrument entered into pursuant
to this Agreement (including any Liability that the Parties may have with
respect to payment, performance, reimbursement, indemnification or contribution
pursuant to this Agreement or any other document agreement or instrument entered
into pursuant to this Agreement for claims brought against the Parties by third
Persons or any Indemnified Party), and the foregoing release will not affect any
Party's right to enforce this Agreement or any other document agreement or
instrument entered into pursuant to this Agreement in accordance with their
respective terms or (ii) any Liability the release of which would result in the
release of any Person other than a Person released pursuant to this Section 5.6
(provided, that the Parties agree not to bring suit or permit any of their
Subsidiaries to bring suit against any Party, its Subsidiaries or Affiliates
with respect to any Liability to the extent such Party, its Subsidiaries and
Affiliates would be released with respect to such Liability by this Section 5.6
but for this clause (ii)).


                                       27
<PAGE>
                  Each of Seller and Purchaser acknowledges that it has been
advised by its legal counsel and is familiar with the provisions of California
Civil Code Section 1542, which provides as follows:

                  "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
                  CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE
                  TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE
                  MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR."

Being aware of said Code section, each of Seller, on behalf of itself and
Seller's Subsidiaries, and Purchaser, on behalf of itself and Maquiladora,
hereby expressly waives any rights it may have under California Civil Code
Section 1542, as well as any other statutes or common law principles of similar
effect.

                  Section 5.7. Public Announcements. The Parties shall use
reasonable best efforts to develop a joint communications plan and each Party
shall use reasonable best efforts (i) to ensure that all press releases and
other public statements with respect to the transactions contemplated hereby
shall be consistent with such joint communications plan, and (ii) unless
otherwise required by applicable laws or by obligations pursuant to any listing
agreement with or rules of any securities exchange or automated quotation
system, to consult with each other before issuing any press release or, to the
extent practicable, otherwise making any public statement with respect to this
Agreement or the transactions contemplated hereby.

                  Section 5.8. Supplements to Schedules. From time to time up to
the Closing, Seller and Purchaser may supplement or amend the Schedules after
they have been delivered pursuant to this Agreement with respect to any matter
first existing or occurring on or after the date hereof which, if existing or
occurring at or prior to the date hereof, would have been required to be set
forth or described in such Schedules or which is necessary to correct any
information in such Schedules which has been rendered inaccurate thereby;
provided, however, that if any facts that give rise to such matter existed or
occurred on or before the date hereof, no such supplement or amendment may be
made under this Section 5.8 with respect thereto. Any such supplement or
amendment to any Schedule shall not, following Closing, constitute a basis for
any Claim for indemnification pursuant to 0; provided, however, that no such
supplement or amendment shall be deemed to cure any breach of any
representations or warranties made pursuant to this Agreement for purposes of
Section 7.1(a) or Section 7.2(a).

                  Section 5.9.      Insurance.


                                       28
<PAGE>
                  (a) Coverage. Subject to the provisions of this Section 5.9,
coverage of Maquiladora under all Policies shall cease as of the Closing. From
and after the Closing, Purchaser will be responsible for obtaining and
maintaining all insurance coverages for Maquiladora. All Policies will be
retained by Seller and Seller's Subsidiaries, together with all rights, benefits
and privileges thereunder (including the right to receive any and all return
premiums with respect thereto), except that Purchaser will have the rights in
respect of Policies to the extent described in Section 5.9(b).

                  (b) Rights Under Policies. From and after the Closing,
Purchaser and Maquiladora will have no rights with respect to any Policies,
except that (i) Purchaser will have the right to assert claims (and Seller will
use commercially reasonable efforts to assist Purchaser in asserting claims) for
any loss, liability or damage with respect to the assets of Maquiladora under
Policies with third-party insurers which are "occurrence basis" insurance
policies ("Occurrence Basis Policies") arising out of insured incidents
occurring from the date coverage thereunder first commenced until the Closing to
the extent that the terms and conditions of any such Occurrence Basis Policies
and agreements relating thereto so allow and (ii) Purchaser will have the right
to continue to prosecute claims with respect to the assets of Maquiladora
properly asserted with an insurer prior to the Closing (and Seller will use
commercially reasonable efforts to assist Purchaser in connection therewith)
under Policies with third-party insurers which are insurance policies written on
a "claims made" basis ("Claims Made Policies") arising out of insured incidents
occurring from the date coverage thereunder first commenced until the Closing to
the extent that the terms and conditions of any such Claims Made Policies and
agreements relating thereto so allow, provided, that in the case of both clauses
(i) and (ii) above, (A) all of Seller's reasonable out-of-pocket costs and
expenses incurred in connection with the foregoing are promptly paid by
Purchaser, (B) Seller may, at any time, without liability or obligation to
Purchaser (other than as set forth in Section 5.9(c)), amend, commute,
terminate, buy-out, extinguish liability under or otherwise modify any
Occurrence Basis Policies or Claims Made Policies (and such claims shall be
subject to any such amendments, commutations, terminations, buy-outs,
extinguishments and modifications), (C) such claims will be subject to (and
recovery thereon will be reduced by the amount of) any applicable deductibles,
retentions or self-insurance provisions, (D) such claims will be subject to (and
recovery thereon will be reduced by the amount of) any payment or reimbursement
obligations of Seller, any of Seller's Subsidiaries or any Affiliate of Seller
or any of Seller's Subsidiaries in respect thereof and (E) such claims will be
subject to exhaustion of existing aggregate limits. Seller's obligation to use
commercially reasonable efforts to assist Purchaser in asserting claims under
applicable Policies will include using commercially reasonable efforts in
assisting Purchaser to establish its right to coverage under such Policies (so
long as all of Seller's reasonable out-of-pocket costs and expenses in
connection therewith are promptly paid by Purchaser). None of Seller or Seller's
Subsidiaries will bear any


                                       29
<PAGE>
Liability for the failure of an insurer to pay any claim under any Policy. It is
understood that any Claims Made Policies will not provide any coverage to
Purchaser for incidents occurring prior to the Closing but which are asserted
with the insurance carrier after the Closing.

                  (c) Seller Actions. In the event that after the Closing,
Seller proposes to amend, commute, terminate, buy-out, extinguish liability
under or otherwise modify any Policies under which Purchaser has rights to
assert claims pursuant to Section 5.9(b) in a manner that would adversely affect
any such rights of Purchaser, (i) Seller will give Purchaser prior notice
thereof and consult with Purchaser with respect to such action (it being
understood that the decision to take any such action will be in the sole
discretion of Seller) and (ii) Seller will pay to Purchaser its equitable share
(which shall be determined by Seller in good faith based on the amount of
premiums paid by or allocated to Purchaser or Maquiladora in respect of the
applicable Policy) of any net proceeds actually received by Seller from the
insurer under the applicable Policy as a result of such action by Seller (after
deducting Seller's reasonable costs and expenses incurred in connection with
such action).

                  (d) Administration. From and after the Closing:

                           (i) Seller or a Subsidiary of Seller, as appropriate,
         will be responsible for the Claims Administration with respect to
         claims of Seller and Seller's Subsidiaries under Policies; and

                           (ii) Purchaser will be responsible for the Claims
         Administration with respect to claims of Purchaser under Policies.

                  (e) Insurance Premiums. From and after the Closing, Seller
will pay all premiums (retrospectively-rated or otherwise) as required under the
terms and conditions of the respective Policies in respect of periods prior to
the Closing, whereupon Purchaser will upon the request of Seller, forthwith
reimburse Seller for that portion of such premiums paid by Seller as are
reasonably determined by Seller to be attributable to Maquiladora.

                  (f) Agreement for Waiver of Conflict and Shared Defense. In
the event that a Policy provides coverage for both Seller and/or a Subsidiary of
Seller, on the one hand, and Purchaser, on the other hand, relating to the same
occurrence, Seller and Purchaser agree to defend jointly and to waive any
conflict of interest necessary to the conduct of that joint defense. Nothing in
this Section 5.9(f) will be construed to limit or otherwise alter in any way the
indemnity obligations of the parties to this Agreement, including those created
by this Agreement, by operation of law or otherwise.


                                       30
<PAGE>
                  Section 5.10. Transition Services Agreement. Promptly
following the date hereof, Purchaser and Seller will discuss the scope, nature,
term and pricing of the transition services to be provided by Seller to
Purchaser following the Closing pursuant to the Transition Services Agreement.
Purchaser and Seller will negotiate in good faith with respect thereto and prior
to the Effective Time will enter into the Transition Services Agreement in a
form reasonably satisfactory to Purchaser and Seller. The Transition Services
Agreement will provide that either Party may terminate any services provided
under the Transition Services Agreement upon such prior written notice as the
Parties shall mutually agree prior to the Closing.

                  Section 5.11. Post-Closing Adjustment. Within seven Business
Days following the Closing, Purchaser shall pay or cause Maquiladora to pay to
Seller, by wire transfer of immediately available funds to an account designated
by Seller in writing, an amount equal to the bank cash of Maquiladora as
reported by Maquiladora's bank as of the close of business on the Closing Date
as an adjustment to the Purchase Price. All payments made under this Section
5.11 shall be made in United States dollars. For purposes of calculating the
United States dollar amount due under this Section 5.11, Mexican peso amounts
will be converted at the noon buying rate for Mexican pesos on the date of the
payment as reported by the Federal Reserve Bank of New York.


                                   ARTICLE VI

                                  CONDITIONS TO
                      SELLER'S AND PURCHASER'S OBLIGATIONS


                  The obligations of Seller and Purchaser to complete the
transactions contemplated by this Agreement are subject to the satisfaction, on
or prior to the Closing, of each of the following conditions precedent;
provided, however, that upon consummation of the Merger, all conditions
precedent contained in this ARTICLE VI shall be deemed fully satisfied for
purposes of this ARTICLE VI:

                  Section 6.1. HSR Act. The waiting period (and any extension
thereof) applicable to the transactions contemplated by this Agreement under the
HSR Act shall have been terminated or shall have expired.

                  Section 6.2. Mexican Competition Commission Approval. Seller
and Purchaser shall have received the required consent or approval of the
Mexican Competition Commission.

                  Section 6.3. No Injunctions or Restraints, Illegality. No Laws
shall have been adopted, promulgated or enforced by any Governmental Authority,
and no


                                       31
<PAGE>
temporary restraining order, preliminary or permanent injunction or other order
issued by a court or other Governmental Authority of competent jurisdiction (an
"Injunction") shall be in effect, having the effect of making the transactions
contemplated under this Agreement illegal or otherwise prohibiting such
transactions. No proceeding initiated by any Governmental Authority seeking, and
which is reasonably likely to result in the granting of, an Injunction shall be
pending.

                  Section 6.4. Completion of the Merger. The Merger shall have
been consummated.


                                   ARTICLE VII

                            ADDITIONAL CONDITIONS TO
                      SELLER'S AND PURCHASER'S OBLIGATIONS


                  Section 7.1. Conditions to Seller's Obligations. The
obligations of Seller to complete the transactions contemplated by this
Agreement are subject to the satisfaction, on or prior to the Closing, of each
of the following conditions precedent; provided, however, that upon consummation
of the Merger, all conditions precedent contained in this Section 7.1 shall be
deemed fully satisfied for purposes of this ARTICLE VII:

                  (a) Representations, Warranties and Covenants. Each of the
representations and warranties of Purchaser contained in this Agreement shall be
true and correct (without giving effect to any qualification or limitation as to
materiality or material adverse effect set forth therein) in each case as of the
date hereof and (except to the extent that such representations and warranties
speak solely as to another date) as of the Closing Date as though made on and as
of the Closing Date, except where the failure of such representations and
warranties to be true and correct, individually or in the aggregate, would not
reasonably be expected to have a material adverse effect on the ability of
Purchaser to consummate the transactions contemplated in this Agreement.

                  (b) Performance of Obligations of Purchaser. Purchaser (i)
shall have performed or complied with all agreements and covenants required to
be performed by it under this Agreement at or prior to the Closing Date that are
qualified as to materiality or material adverse effect and (ii) shall have
performed or complied in all material respects with all other agreements and
covenants required to be performed by it under this Agreement at or prior to the
Closing Date that are not so qualified.

                  Section 7.2. Conditions to Purchaser's Obligations. The
obligations of Purchaser to complete the transactions contemplated by this
Agreement are subject to the


                                       32
<PAGE>
satisfaction, on or prior to the Closing, of each of the following conditions
precedent; provided, however, that upon consummation of the Merger, all
conditions precedent contained in this Section 7.2 shall be deemed fully
satisfied for purposes of this ARTICLE VII:

                  (a) Representations, Warranties and Covenants. Each of the
representations and warranties of Seller contained in this Agreement shall have
been true and correct (without giving effect to any qualification or limitation
as to materiality or Material Adverse Effect set forth therein) in each case as
of the date hereof and (except to the extent that such representations and
warranties speak solely as to another date) as of the Closing Date as though
made on and as of the Closing Date, except where the failure of such
representations and warranties to be true and correct, individually or in the
aggregate, would not reasonably be expected to have a Closing Material Adverse
Effect.

                  (b) Performance of Obligations of Seller. Seller (i) shall
have performed or complied with all agreements and covenants required to be
performed by it under this Agreement at or prior to the Closing Date that are
qualified as to materiality or Material Adverse Effect and (ii) shall have
performed or complied in all material respects with all other agreements and
covenants required to be performed by it under this Agreement at or prior to the
Closing Date that are not so qualified.


                                  ARTICLE VIII

                                     CLOSING


                  The Closing shall, unless another time and date is agreed to
in writing by the Parties, take place immediately following the Closing (as
defined in the Merger Agreement) under the Merger Agreement and will be
effective immediately following the Effective Time (the time and date of such
Closing being herein called the "Closing Date"). The Closing will take place at
the offices of Chadbourne & Parke LLP, 30 Rockefeller Plaza, New York, New York
10112, or such other place as the Parties may agree. On the Closing Date, the
Parties hereto shall deliver the following:

                  Section 8.1. Deliveries by Seller. At the Closing, Seller
shall deliver to Purchaser (or shall cause the delivery to Purchaser of) the
following which in the case of documents shall be reasonably satisfactory to
Purchaser:

                  (i) a stock certificate or certificates representing the
         Shares, duly endorsed by Seller to Purchaser sufficient to transfer to
         Purchaser good and marketable title to the Shares, and evidence that
         such transfer to Purchaser of the Shares has been recorded on the
         Maquiladora's stock registry book;


                                       33
<PAGE>
                  (ii) the Seller's Contrato de Compra-Venta de Acciones, duly
         executed by Seller, in form and substance reasonably satisfactory to
         Purchaser;

                  (iii) the Supply Agreement, duly executed by Seller, in form
         and substance reasonably satisfactory to Purchaser;

                  (iv) the Transition Services Agreement, duly executed by
         Seller, in form and substance reasonably satisfactory to Purchaser; and

                  (v) a duly sworn affidavit of Seller, dated as of the Closing
         Date, stating that Seller is not a "foreign person" as that term is
         defined in the Code, setting forth Seller's tax identification numbers
         and otherwise meeting the requirements of Section 1445(b)(2) of the
         Code and the Treasury Regulations promulgated thereunder.

                  Section 8.2. Deliveries by Minority Shareholder. At the
Closing, Seller shall cause Minority Shareholder to deliver to Minority
Purchaser the following documents, which shall be reasonably satisfactory to
Purchaser:

                  (i) a stock certificate or certificates representing the
         Minority Shares, duly endorsed by Minority Shareholder sufficient to
         transfer to Purchaser good and marketable title to the Minority Shares
         to Minority Purchaser, and evidence that such transfer of the Minority
         Shares has been recorded on the Maquiladora's stock registry book;

                  (ii) the Minority Shareholder's Contrato de Compra-Venta de
         Acciones, duly executed by Minority Shareholder, in form and substance
         reasonably satisfactory to Purchaser; and

                  (iii) a duly sworn affidavit of Minority Shareholder, dated as
         of the Closing Date, stating that Minority Shareholder is not a
         "foreign person" as that term is defined in the Code, setting forth
         Minority Shareholder's tax identification numbers and otherwise meeting
         the requirements of Section 1445(b)(2) of the Code and the Treasury
         Regulations promulgated thereunder.

                  Section 8.3. Deliveries by Purchaser. At the Closing,
Purchaser shall deliver to Seller the following, which in the case of documents
shall be reasonably satisfactory to Seller:

                  (i) (A) cash payment of the portion of the Purchase Price (via
         wire transfer of immediately available funds), pursuant to Section 2.2,
         or (B) the Promissory Note, duly executed by Purchaser, in which case,
         Purchaser shall


                                       34
<PAGE>
         deliver to Seller at Closing, in addition to the other deliveries
         required hereby, (I) the Financing Agreement, duly executed by
         Purchaser, and (II) such notices, recordings, mortgages, statements,
         filings, instruments or other agreements and documents as shall be
         required pursuant to the terms of the Financing Agreement;

                  (ii) the Seller's Contrato de Compra-Venta de Acciones, duly
         executed by Purchaser, in form and substance reasonably satisfactory to
         Seller;

                  (iii) the Supply Agreement, duly executed by Purchaser, in
         form and substance reasonably satisfactory to Seller; and

                  (iv) the Transition Services Agreement, duly executed by
         Purchaser, in form and substance reasonably satisfactory to Seller.

                  Section 8.4. Deliveries by Minority Purchaser. At the Closing,
Purchaser shall cause Minority Purchaser to deliver to the Minority Shareholder
the following, which in the case of documents shall be reasonably satisfactory
to Minority Shareholder:

                  (i) the Minority Shareholder's Contrato de Compra-Venta de
         Acciones duly executed by Minority Purchaser, in form and substance
         reasonably satisfactory to Seller.


                                   ARTICLE IX

                                 INDEMNIFICATION


                  Section 9.1. Indemnification by Seller. Subject to the
limitations on and procedures for indemnification set forth in this 0, Seller
shall indemnify, defend and hold harmless Purchaser and its Representatives and
Affiliates and each of the heirs, executors, successors and assigns of any of
the foregoing (the "Purchaser Indemnified Parties") from and against, and pay or
reimburse, as the case may be, the Purchaser Indemnified Parties for, any
Damages, as incurred, suffered by any Purchaser Indemnified Parties to the
extent based upon, arising out of or relating to the following:

                  (i) the breach of any representation or warranty of Seller
         contained in this Agreement; or

                  (ii) the breach by Seller of any covenant or agreement of
         Seller contained in this Agreement.

                  Section 9.2. Indemnification by Purchaser. Subject to the
limitations on and procedures for indemnification set forth in this ARTICLE IX,
Purchaser shall


                                       35
<PAGE>
indemnify, defend and hold harmless Seller and its Representatives and
Affiliates and each of the heirs, executors, successors and assigns of any of
the foregoing (collectively, the "Seller Indemnified Parties") from and against,
and pay or reimburse, as the case may be, the Seller Indemnified Parties for,
any Damages, as incurred, suffered by any Seller Indemnified Parties to the
extent based upon, arising out of or relating to the following:

                  (i) the breach of any representation or warranty of Purchaser
         contained in this Agreement;

                  (ii) the breach by Purchaser of any covenant or agreement of
         Purchaser contained in this Agreement; or

                  (iii) any Liabilities of Maquiladora, except to the extent
         that Seller is or would be required to indemnify an Indemnified Party
         for such Liability under Section 9.1(i) (assuming for purposes of the
         determination of whether such indemnification is or would be required
         that (A) the indemnification obligation has not terminated under
         Section 9.6 and (B) any relevant representations or warranties have not
         expired under Section 12.4).

                  Section 9.3. Limitations on Indemnification Obligations. (a)
The amount which any Party (an "Indemnifying Party") is or may be required to
pay to any Person (an "Indemnified Party") in respect of Damages or other
Liability for which indemnification is provided under this Agreement shall be
reduced by any amounts actually received (including Insurance Proceeds actually
received) by or on behalf of such Indemnified Party (net of increased insurance
premiums and charges to the extent related to Damages and costs and expenses
(including reasonable legal fees and expenses) incurred by such Indemnified
Party in connection with seeking to collect and collecting such amounts) in
respect of such Damages or other Liability (such net amounts are referred to
herein as "Indemnity Reduction Amounts"). If any Indemnified Party receives any
Indemnity Reduction Amounts in respect of Damages for which indemnification is
provided under this Agreement after the full amount of such Damages has been
paid by an Indemnifying Party or after an Indemnifying Party has made a partial
payment of such Damages and such Indemnity Reduction Amounts exceed the
remaining unpaid balance of such Damages, then the Indemnified Party shall
promptly remit to the Indemnifying Party an amount equal to the excess (if any)
of (A) the amount theretofore paid by the Indemnifying Party in respect of such
Damages, less (B) the amount of the indemnity payment that would have been due
if such Indemnity Reduction Amounts in respect thereof had been received before
the indemnity payment was made.

                  (b) In determining the amount of any indemnity payment under
this Agreement, such amount shall be (i) reduced to take into account any net
Tax benefit realized by the Indemnified Party and its Affiliates arising from
the incurrence or


                                       36
<PAGE>
payment by the Indemnified Party or its Affiliates of any amount in respect of
which such payment is made and (ii) increased to take into account any net Tax
cost incurred by the Indemnified Party and its Affiliates as a result of the
receipt or accrual of payments hereunder (grossed-up for such increase), in each
case determined by treating the Indemnified Party and its Affiliates as
recognizing all other items of income, gain, loss, deduction or credit before
recognizing any item arising from the receipt of accrual of any payment
hereunder. In determining the amount of any such Tax benefit or Tax cost, the
Indemnified Party and its Affiliates shall be deemed to be subject to the
applicable Taxes at the maximum statutory rate then in effect. It is the
intention of the Parties to this Agreement that payments made pursuant to this
Agreement are to be treated as relating back to the Closing Date as a purchase
price adjustment, and the Parties shall not take any position inconsistent with
such intention before any Tax authority, except to the extent that a final
determination (as defined in Section 1313 of the Code) with respect to the
recipient party causes any such payment not to be so treated.

                  (c) No monetary amount will be payable by Seller to any
Purchaser Indemnified Party with respect to the indemnification of any claims
pursuant to Section 9.1(i) until the aggregate amount of Damages actually
incurred by the Purchaser Indemnified Parties with respect to such claims,
together with the aggregate amount of Damages (as defined in the Mexican Asset
Purchase Agreement) actually incurred by the Purchaser Indemnified Parties (as
defined in the Mexican Asset Purchase Agreement) with respect to indemnification
claims pursuant to Section 9.1(i) of the Mexican Asset Purchase Agreement, shall
exceed on a cumulative basis an amount equal to one million dollars
(U.S.$1,000,000), in which event Seller shall be responsible only for the amount
of such Damages in excess of one million dollars (U.S.$1,000,000). No monetary
amount will be payable by Seller to any Purchaser Indemnified Party with respect
to the indemnification of any claims pursuant to Section 9.1(i) after the
aggregate amount of Damages actually paid by Seller with respect to such claims,
together with the aggregate amount of Damages (as defined in the Mexican Asset
Purchase Agreement) actually paid by Seller with respect to indemnification
claims pursuant to Section 9.1(i) of the Mexican Asset Purchase Agreement, shall
equal on a cumulative basis an amount equal to ten million dollars
(U.S.$10,000,000).

                  (d) No monetary amount will be payable by Purchaser to any
Seller Indemnified Party with respect to the indemnification of any claims
pursuant to Section 9.2(i) until the aggregate amount of Damages actually
incurred by the Seller Indemnified Parties with respect to such claims, together
with the aggregate amount of Damages (as defined in the Mexican Asset Purchase
Agreement) actually incurred by the Seller Indemnified Parties (as defined in
the Mexican Asset Purchase Agreement) with respect to indemnification claims
pursuant to Section 9.2(i) of the Mexican Asset Purchase Agreement, shall exceed
on a cumulative basis an amount equal to one million dollars (U.S.$1,000,000),
in which event Purchaser shall be responsible only for the


                                       37
<PAGE>
amount of such Damages in excess of one million dollars (U.S.$1,000,000). No
monetary amount will be payable by Purchaser to any Seller Indemnified Party
with respect to the indemnification of any claims pursuant to Section 9.2(i)
after the aggregate amount of Damages actually paid by Purchaser with respect to
such claims, together with the aggregate amount of Damages (as defined in the
Mexican Asset Purchase Agreement) actually paid by Purchaser with respect to
indemnification claims pursuant to Section 9.2(i) of the Mexican Asset Purchase
Agreement, shall equal on a cumulative basis an amount equal to ten million
dollars (U.S.$10,000,000).

                  Section 9.4. Procedures Relating to Indemnification. (a) If a
claim or demand is made against an Indemnified Party, or an Indemnified Party
shall otherwise learn of an assertion, by any Person who is not a party to this
Agreement (or an Affiliate thereof) as to which an Indemnifying Party may be
obligated to provide indemnification pursuant to this Agreement (a "Third Party
Claim"), such Indemnified Party will notify the Indemnifying Party in writing,
and in reasonable detail, of the Third Party Claim reasonably promptly after
becoming aware of such Third Party Claim; provided, however, that failure to
give such notification will not affect the indemnification provided hereunder
except to the extent the Indemnifying Party shall have been actually prejudiced
as a result of such failure. Thereafter, the Indemnified Party will deliver to
the Indemnifying Party, promptly after the Indemnified Party's receipt thereof,
copies of all material notices and documents (including court papers) received
or transmitted by the Indemnified Party's relating to the Third Party Claim.

                  (b) If a Third Party Claim is made against an Indemnified
Party, the Indemnifying Party will be entitled to participate in or to assume
the defense thereof (in either case, at the expense of the Indemnifying Party)
with counsel selected by the Indemnifying Party and reasonably satisfactory to
the Indemnified Party. Should the Indemnifying Party so elect to assume the
defense of a Third Party Claim, the Indemnifying Party will not be liable to the
Indemnified Party for any legal or other expenses subsequently incurred by the
Indemnified Party in connection with the defense thereof; provided, however,
that if in the Indemnified Party's reasonable judgment a conflict of interest
exists in respect of such claim or if the Indemnifying Party shall have assumed
responsibility for such claim with any reservations or exceptions, such
Indemnified Party will have the right to employ separate counsel reasonably
satisfactory to the Indemnifying Party to represent such Indemnified Party and
in that event the reasonable fees and expenses of such separate counsel (but not
more than one separate counsel for all Indemnified Parties similarly situated)
shall be paid by such Indemnifying Party. If the Indemnifying Party assumes the
defense of any Third Party Claim, the Indemnified Party will have the right to
participate in the defense thereof and to employ counsel, at its own expense,
separate from the counsel employed by the Indemnifying Party, it being
understood that the Indemnifying Party will control such defense. The
Indemnifying Party will be liable for the reasonable fees and expenses of
counsel


                                       38
<PAGE>
employed by the Indemnified Party for any period during which the Indemnifying
Party has failed to assume the defense thereof. If the Indemnifying Party
assumes the defense of any Third Party Claim, the Indemnifying Party will
promptly supply to the Indemnified Party copies of all material correspondence
and documents relating to or in connection with such Third Party Claim and keep
the Indemnified Party fully informed of all material developments relating to or
in connection with such Third Party Claim (including providing to the
Indemnified Party on request updates and summaries as to the status thereof). If
the Indemnifying Party chooses to defend a Third Party Claim, the Parties will
cooperate in the defense thereof (such cooperation to be at the expense,
including reasonable legal fees and expenses, of the Indemnifying Party), which
cooperation shall include the retention in accordance with this Agreement and
(upon the Indemnifying Party's request) the provision to the Indemnifying Party
of records and information which are reasonably relevant to such Third Party
Claim, and making employees available on a mutually convenient basis to provide
additional information and explanation of any material provided hereunder.

                  (c) No Indemnifying Party will consent to any settlement,
compromise or discharge (including the consent to entry of any judgment) of any
Third Party Claim without the Indemnified Party's prior written consent (which
consent will not be unreasonably withheld); provided, however, that if the
Indemnifying Party assumes the defense of any Third Party Claim, the Indemnified
Party will agree to any settlement, compromise or discharge of such Third Party
Claim which the Indemnifying Party may recommend and which by its terms
obligates the Indemnifying Party to pay the full amount of Damages in connection
with such Third Party Claim and unconditionally and irrevocably releases the
Indemnified Party and its Affiliates completely from all Liability in connection
with such Third Party Claim; provided, however, that the Indemnified Party may
refuse to agree to any such settlement, compromise or discharge (x) that
provides for injunctive or other non-monetary relief affecting the Indemnified
Party or any of its Affiliates or (y) that, in the reasonable opinion of the
Indemnified Party, would otherwise materially adversely affect the Indemnified
Party or any of its Affiliates. Whether or not the Indemnifying Party shall have
assumed the defense of a Third Party Claim, the Indemnified Party will not
(unless required by law) admit any liability with respect to, or settle,
compromise or discharge, such Third Party Claim without the Indemnifying Party's
prior written consent (which consent will not be unreasonably withheld).

                  (d) Any claim on account of Damages which does not involve a
Third Party Claim will be asserted by reasonably prompt written notice given by
the Indemnified Party to the Indemnifying Party from whom such indemnification
is sought. The failure by any Indemnified Party to so notify the Indemnifying
Party will not relieve the Indemnifying Party from any liability which it may
have to such Indemnified Party


                                       39
<PAGE>
under this Agreement, except to the extent that the Indemnifying Party shall
have been actually prejudiced by such failure.

                  (e) In the event of payment in full by an Indemnifying Party
to any Indemnified Party in connection with any Third Party Claim, such
Indemnifying Party will be subrogated to and shall stand in the place of such
Indemnified Party as to any events or circumstances in respect of which such
Indemnified Party may have any right or claim relating to such Third Party Claim
against any claimant or plaintiff asserting such Third Party Claim or against
any other Person. Such Indemnified Party will cooperate with such Indemnifying
Party in a reasonable manner, and at the cost and expense of such Indemnifying
Party, in prosecuting any subrogated right or claim.

                  Section 9.5. Sole and Exclusive Remedy. The indemnities
contained in this ARTICLE IX and ARTICLE X shall be the sole and exclusive
remedies of the Parties hereto, their Affiliates, successors and assigns with
respect to any and all claims arising out of or relating to this Agreement, the
transactions contemplated hereby, any provision hereof or the breach or
performance thereof.

                  Section 9.6. Termination of Indemnification Obligations.
Except as set forth in the following sentence, the indemnification obligations
of each of Seller and Purchaser hereunder will survive the Closing, including
surviving the sale or other transfer by any party to this Agreement of any
assets or businesses or the assignment by any party of any Liabilities. The
obligations of each Party to indemnify, defend and hold harmless Indemnified
Parties (i) pursuant to Sections 9.1(i) and 9.2(i), shall terminate when the
applicable representation or warranty expires pursuant to Section 12.4, (ii)
pursuant to Sections 9.1(ii) and 9.2(ii) shall terminate upon the expiration of
all applicable statutes of limitation (giving effect to any extensions thereof,
other than extensions caused by the applicable Indemnified Party) and (iii)
pursuant to Section 9.2(iii) shall continue without time limitation and shall
not terminate at any time; provided, however, that as to clauses (i) and (ii)
above, such obligations to indemnify, defend and hold harmless shall not
terminate with respect to any individual claim as to which the Indemnified Party
shall have, before the expiration of the applicable period, previously delivered
a notice (stating in reasonable detail the basis of such claim) to the
Indemnifying Party.

                  Section 9.7. Effect of Investigation. The right to
indemnification pursuant to Sections 9.1(i) and 9.2(i) shall not be affected by
any investigation conducted with respect to, or any knowledge acquired (or
capable of being acquired) at any time, whether before or after the execution
and delivery of this Agreement.


                                       40
<PAGE>
                  Section 9.8. Tax Matters. Notwithstanding anything in Sections
9.1, 9.2, 9.4 or 9.5 to the contrary, ARTICLE X will be the exclusive agreement
among the Parties with respect to indemnification, procedures and remedies with
respect to Tax matters.


                                    ARTICLE X

                                   TAX MATTERS


                  Section 10.1. Preparation and Filing of Tax Returns. Seller
shall prepare and file or cause to be prepared and filed all Tax Returns
(including amendments thereto) which are required to be filed in respect of
Maquiladora for any taxable period ending on or before the Closing Date and any
taxable period that includes (but does not end on) the Closing Date (a "Straddle
Period"). Purchaser hereby irrevocably designates, and agrees to cause each of
its Affiliates to designate, Seller as its agent to take any and all actions
necessary or incidental to the preparation and filing of such Tax Returns. All
Tax Returns (including amendments thereto) required to be filed in respect of
Maquiladora for taxable periods beginning after the Closing Date shall be the
responsibility of Purchaser.

                  Section 10.2. Consistent with Past Practice. Unless Seller and
Purchaser otherwise agree in writing, all Tax Returns (including amendments
thereto) described in Section 10.1 filed after the Closing Date for taxable
periods ending on or before the Closing Date or Straddle Periods, in the absence
of a controlling change in law or circumstances, shall be prepared on a basis
consistent with the elections, accounting methods, conventions and principles of
taxation used for the most recent taxable periods for which Tax Returns
involving similar matters have been filed. Upon request of Purchaser, Seller
shall make available a draft of such Tax Return (or relevant portions thereof)
for review and comment by Purchaser. Subject to the provisions of this
Agreement, all decisions relating to the preparation of Tax Returns shall be
made in the sole discretion of the party responsible under this Agreement for
such preparation.

                  Section 10.3. Payment of Taxes. Except as otherwise provided
in this Agreement, Seller shall pay or cause to be paid, on a timely basis, all
Taxes due with respect to the Tax liability of Maquiladora for taxable periods
ending on or before the Closing Date or Straddle Periods provided, however, that
Purchaser, on behalf of Maquiladora, hereby assumes and agrees to pay directly
to or at the direction of Seller, at least five days prior to the date payment
(including estimated payment) thereof is due, the portion of such Taxes for that
portion of any Straddle Period which begins on the day after the Closing Date
(calculated pursuant to Section 10.4) which relates to Maquiladora or its
business, assets or activities. Purchaser shall pay or cause to be paid, on a
timely basis, all Taxes due with respect the Tax liability of Maquiladora for
any taxable period beginning after the Closing Date.


                                       41
<PAGE>
                  Section 10.4. Allocation of Straddle Period Taxes. In the case
of any Straddle Period:

                  (a) Periodic Taxes. (i) The periodic Taxes of Maquiladora or
its business, assets or activities for the portion of any Straddle Period which
ends on the Closing Date shall be computed based on the ratio of the number of
days in such portion of the Straddle Period and the number of days in the entire
taxable period, and (ii) the periodic taxes of Maquiladora or its business,
assets or activities for the portion of any Straddle Period beginning on the day
after the Closing Date shall be computed based on the ratio of the number of
days in such portion of the Straddle Period and the number of days in the entire
taxable period

                  (b) Non-Periodic Taxes. (i) The Taxes of Maquiladora or its
business, assets or activities for that portion of any Straddle Period ending on
the Closing Date (other than Taxes described in Section 10.4(a) above), shall be
computed on a "closing-of-the-books" basis as if such taxable period ended as of
the close of business on the Closing Date, and (ii) the Taxes of Maquiladora or
its business, assets or activities for that portion of any Straddle Period
beginning after the Closing Date (other than Taxes described in Section 10.4(a)
above), shall be computed on a "closing-of-the-books" basis as if such taxable
period began on the day after the Closing Date.

                  Section 10.5. Tax Refunds and Carrybacks.

                  (a) Retention and Payment of Tax Refunds. Except as otherwise
provided in this Agreement, Seller shall be entitled to retain, and to receive
within ten days after Actually Realized by Purchaser and its Affiliates, the
portion of all refunds or credits of Taxes for which Seller is liable pursuant
to Section 10.3 or Section 10.6(a), and Purchaser shall be entitled to retain,
and to receive within ten days after Actually Realized by Seller and its
Affiliates, the portion of all refunds or credits of Taxes for which Purchaser
is liable pursuant to Section 10.3 or Section 10.6(b). The amount of any refund
or credit of Taxes to which Seller or Purchaser is entitled to retain or receive
pursuant to the foregoing sentence shall be reduced to take account of any Taxes
incurred by Purchaser and its Affiliates, in the case of a refund or credit to
which Seller is entitled, or Seller and its Affiliates, in the case of a refund
or credit to which Purchaser is entitled, upon the receipt of such refund or
credit.

                  (b) Carrybacks. Unless the parties otherwise agree in writing,
Purchaser shall elect where permitted by law, to carry forward any net operating
loss, net capital loss, charitable contribution or other item arising after the
Closing Date that could, in the absence of such election, be carried back to a
taxable period ending on or before the Closing Date. Except as otherwise
provided in this Agreement, notwithstanding the provisions of Section 10.5(a),
(i) any refund or credit of Taxes resulting from the


                                       42
<PAGE>
carryback of any item of Taxes attributable to Purchaser or its Affiliates
arising in a taxable period beginning after the Closing Date to a taxable period
ending on or before the Closing Date or that portion of any Straddle Period that
ends on the Closing Date shall be for the account and benefit of Purchaser and
its Affiliates, and (ii) any refund or credit of Taxes resulting from the
carryback of any item of Taxes attributable to Seller or its Affiliates arising
in a taxable period beginning after the Closing Date to a taxable period ending
on or before the Closing Date or that portion of any Straddle Period that ends
on the Closing Date shall be for the account and benefit of Seller and its
Affiliates.

                  (c) Refund Claims. Seller shall be permitted to file at
Seller's sole expense, and Purchaser shall reasonably cooperate with Seller in
connection with, any claims for refund of Taxes to which Seller is entitled
pursuant to this Section 10.5 or any other provision of this Agreement. Seller
shall reimburse Purchaser for any reasonable out-of-pocket costs and expenses
incurred by Purchaser and its Representatives or Affiliates in connection with
such cooperation. Purchaser shall be permitted to file at Purchaser's sole
expense, and Seller shall reasonably cooperate with Purchaser in connection
with, any claims for refunds of Taxes to which Purchaser is entitled pursuant to
this Section 10.5 or any other provision of this Agreement. Purchaser shall
reimburse Seller for any reasonable out-of-pocket costs and expenses incurred by
Seller and its Representatives and Affiliates in connection with such
cooperation.

                  Section 10.6. Tax Indemnification.

                  (a) Seller Indemnification. Seller shall be liable for, and
shall indemnify, defend and hold harmless the Purchaser Indemnified Parties from
and against:

                  (i) all Taxes of Maquiladora for any taxable period that ends
         on or before the Closing Date and the portion of any Straddle Period
         ending on the Closing Date;

                  (ii) all Taxes for any Tax period (whether beginning before,
         on or after the Closing Date) attributable to the breach by Seller or
         its Affiliates of any representation, warranty, covenant or obligation
         under this Agreement;

                  (iii) all liability for a breach by Seller of any
         representation, warranty, covenant, or obligation under this Agreement
         with respect to Tax matters; and

                  (iv) all liability for any reasonable legal, accounting,
         appraisal, consulting or similar fees and expenses relating to the
         foregoing.

              Notwithstanding the foregoing, Seller shall not indemnify, defend
or hold harmless the Purchaser Indemnified Parties from any liability for Taxes
attributable to a


                                       43
<PAGE>
Purchaser Tax Act. A Purchaser Tax Act shall mean any action specified in
Schedule 10.6 attached hereto. Seller's obligations under this Section 10.6(a)
shall not be subject to the limitations in Section 9.3 of this Agreement.

                  (b) Purchaser Indemnification. Purchaser shall be liable for,
and shall indemnify, defend and hold harmless the Seller Indemnified Parties
from and against:

                  (i) all Taxes of Maquiladora (other than Taxes for which
         Seller is obligated to provide indemnification for pursuant to Section
         10.6(a)(i));

                  (ii) all Taxes for any Tax period (whether beginning before,
         on or after the Closing Date) attributable to the breach by Purchaser
         or its Affiliates of any representation, warranty, covenant or
         obligation under this Agreement;

                  (iii) all liability for a breach by Purchaser of any
         representation, warranty, covenant, or obligation under this Agreement
         with respect to Tax matters;

                  (iv) all Taxes attributable to a Purchaser Tax Act; and

                  (v) all liability for any reasonable legal, accounting,
         appraisal, consulting or similar fees and expenses relating to the
         foregoing.

              Purchaser's obligation under this Section 10.6(b) shall not be
subject to the limitations in Section 9.3 of this Agreement.

                  Section 10.7. Notice of Indemnity. Whenever an Indemnified
Party becomes aware of the existence of an issue raised by any Tax authority
which could reasonably be expected to result in a determination that would
increase the liability for any Tax of the other Party hereto or any of its
Representatives or Affiliates for any Tax period or require a payment hereunder
by the other party (hereinafter an "Indemnity Issue"), the Indemnified Party
shall in good faith promptly give notice to an Indemnifying Party of such
Indemnity Issue. The failure of the Indemnified Party to give such notice shall
not relieve the Indemnifying Party of its obligations under this Agreement,
except to the extent such Indemnifying Party or any of its Representatives or
Affiliates is actually prejudiced by such failure to give notice.

                  Section 10.8. Payments.

                  (a) Timing Adjustments. In the event that a final
determination (which shall include the execution of a Form 870-AD or successor
form) results in a timing difference (e.g., an acceleration of income or delay
of deductions) that would increase Seller's liability for Taxes pursuant to
ARTICLE IX or this ARTICLE X or


                                       44
<PAGE>
results in a timing difference (e.g., an acceleration of deductions or delay of
income) that would increase Purchaser's liability for Taxes pursuant to ARTICLE
IX or this ARTICLE X, Purchaser or Seller, as the case may be, will promptly
make payments to Seller or Purchaser as and when Purchaser or Seller (or its
Affiliates), as the case may be, actually realizes any Tax benefits as a result
of such timing difference (or under such other method for determining the
present value of any such anticipated Tax benefits as agreed to by the Parties).

                  (b) Time for Payment. Any indemnity payment required to be
made pursuant to this Agreement shall be paid within thirty days after the
Indemnified Party makes written demand upon the Indemnifying Party, provided
that in no event shall such payment be required to be made earlier than five
business days prior to the date on which the relevant Taxes (including estimated
Taxes) are required to be paid (or would be required to be paid if no such Taxes
are due) to the relevant Tax authority.

                  Section 10.9. Tax Contests. The Indemnifying Party and its
Representatives, at the Indemnifying Party's expense, shall be entitled to
participate (a) in all conferences, meetings and proceedings with any Tax
authority, the subject matter of which is or includes an Indemnity Issue and (b)
in all appearances before any court, the subject matter of which is or includes
an Indemnity Issue. The Party who has responsibility for filing the Tax Return
under this Agreement with respect to which there could be an increase in
liability for any Tax or with respect to which a payment could be required
hereunder shall have the right to decide as between the Parties hereto how such
matter is to be dealt with and finally resolved with the appropriate Tax
Authority and shall control all audits and similar proceedings, provided,
however, that if such contest would be reasonably expected to result in a
material increase in the tax liability of Maquiladora for which Purchaser would
be liable, Purchaser may participate in the conduct of such contest and Seller
shall not settle any such contest without the consent of Purchaser, which
consent shall not be unreasonably withheld. If no Tax Return is or was required
to be filed in respect of an Indemnity Issue, the Indemnifying Party shall be
treated as the responsible party with respect thereto. The responsible party
agrees to cooperate in the settlement of any Indemnity Issue with the other
Party and to take such other Party's interests into account.

                  Section 10.10. Cooperation and Exchange of Information. Each
Party hereto agrees to provide, and to cause each of its Affiliates to provide,
such cooperation and information as such other Party shall request, on a timely
basis, in connection with the preparation or filing of any Tax Return or claim
for Tax refund not inconsistent with this Agreement or in conducting any Tax
audit, Tax dispute, or otherwise in respect of Taxes or to carry out the
provisions of this Agreement, provided, however, that neither Party shall be
obligated to provide the other Party with Tax Returns, documentation or other
information of a proprietary or confidential nature for purposes of verifying
any


                                       45
<PAGE>
calculation, and provided further, that in any such case where one Party does
not provide the other Party with Tax Returns, documentation or information
because it is proprietary or confidential, both Parties shall cooperate in
developing mutually acceptable procedures including retaining a mutually
agreeable accounting firm to review such Tax Returns, documentation or
information for purposes of verifying such calculation.

                  Section 10.11. Mexican Income Taxes; Customs Duties; Advanced
Pricing Agreement; Transfer, Sales and Use Taxes.

                  (a) Mexican Income Taxes. Seller shall, and shall cause
Minority Shareholder to, and Purchaser shall, and shall cause Minority Purchaser
to, fully comply with all Mexican Tax laws and with the Convention between the
United States of America and the United Mexican States for Avoidance of Double
Taxation and Prevention of Fiscal Evasion with respect to Taxes on Income in
connection with the sale of the Shares and the Minority Shares such that
Purchaser shall not be required to, and Purchaser shall not, deduct or withhold
any amount from the Purchase Price. Seller agrees to indemnify and hold
Purchaser and Minority Purchaser harmless from and against any Taxes imposed on
Seller, Minority Shareholder, Purchaser or Minority Purchaser with respect to
any gain from the sale by Seller or Minority Shareholder, respectively, of the
Shares and the Minority Shares under this Agreement due to any Governmental
Authority, including any obligation Purchaser or Minority Purchaser may have to
withhold or remit to Mexican Governmental Authorities Taxes levied on Seller or
Minority Shareholder, respectively, as a result of any gain from the sale of the
Shares or Minority Shares under this Agreement. The Parties agree that the
Spanish language Contrato de Compra-Venta de Acciones with respect to the Shares
and the Spanish language Contrato de Compra-Venta de Acciones with respect to
the Minority Shares to be delivered at the Closing as provided in Section
8.1(ii), Section 8.2(ii), Section 8.3(ii) and Section 8.4(i), shall be used by
the Parties, Minority Shareholder and Minority Purchaser for Mexican Tax
reporting purposes and that the consideration set forth in such documents shall
be the same as and not in addition to the Purchase Price.

                  (b) Advanced Pricing Agreement. Seller, at its own expense,
shall have the sole and exclusive right, power and authority to negotiate with
the appropriate Mexican Governmental Authorities and enter into the Advanced
Pricing Agreement on or prior to the Closing. Seller shall keep Purchaser
informed of the status of such negotiations and shall not enter into the
Advanced Pricing Agreement without the written consent of Purchaser, which
consent shall not be unreasonably withheld. Purchaser, Maquiladora, and Seller
shall cooperate with each other in negotiating and finalizing the Advanced
Pricing Agreement after the Closing. Purchaser shall, and shall cause
Maquiladora, not to amend, supplement or modify the Advanced Pricing Agreement
as it would relate to periods prior to the Closing without the written consent
of Seller, which consent shall not be unreasonably withheld.


                                       46
<PAGE>
                  (c) Mexican Customs Duties. Purchaser will cause Maquiladora
at its own expense after the Closing to timely prepare and execute any and all
customs documents required to reflect the change of ownership of the Assets in
Mexico and to timely file a virtual exportation and virtual importation pediment
to reconcile the open pediments of Maquiladora as required by Mexican law.
Seller shall reasonably cooperate with Purchaser and/or Maquiladora in preparing
the Mexican customs duties-related filings. Seller shall be responsible for any
customs duties or fees relating to periods prior to the Closing. Purchaser and
Maquiladora will be responsible for any customs duties or fees relating to
periods from and after the Closing. Purchaser and Seller share equally customs
duties or fees, if any, incurred in connection with the transactions
contemplated by this Agreement.

                  (d) Transfer, Sales, Use and Value Added Taxes.
Notwithstanding anything to the contrary in this Agreement, all transfer,
documentary, sales, use, stamp, registration, value added and other similar
Taxes and fees (including any penalties and interest) incurred in connection
with the transactions contemplated by this Agreement shall be shared equally by
Seller and Purchaser. Each Party hereto agrees to file all necessary
documentation (including all Tax Returns) with respect to such Taxes in a timely
manner.

                  Section 10.12. Tax Records.

                  (a) The Parties agree to (and to cause each of their
Affiliates to) (i) retain all Tax Returns, related schedules and work papers,
and all material records and other documents as required under Section 6001 of
the Code and the regulations promulgated thereunder relating thereto existing on
the date hereof or created through the Closing Date, for a period of at least
ten years following the Closing Date and (ii) allow the Party to this Agreement,
at times and dates reasonably acceptable to the retaining Party, to inspect,
review and make copies of such records, as the Parties may reasonably deem
necessary or appropriate from time to time. In addition, after the expiration of
such ten-year period, such Tax Returns, related schedules and workpapers, and
material records shall not be destroyed or otherwise disposed of at any time,
unless, prior to such destruction or disposal, (A) the Party proposing to
destroy or otherwise dispose of such records shall provide no less than 30 days'
prior written notice to the other Party, specifying in reasonable detail the
records proposed to be destroyed or disposed of and (B) if a recipient of such
notice shall request in writing prior to the scheduled date for such destruction
or disposal that any of the records proposed to be destroyed or disposed of be
delivered to such requesting Party, the Party proposing the destruction or
disposal shall promptly arrange for the delivery of such requested records at
the expense of the Party requesting such records.


                                       47
<PAGE>
                  (b) Notwithstanding anything in this Agreement to the
contrary, if any Party fails to comply with the requirements of Section 10.12(a)
hereof, the Party failing so to comply shall be liable for, and shall hold the
other Party, harmless from, any Taxes (including without limitation, penalties
for failure to comply with the record retention requirements of the Code) and
other costs resulting from such Party's failure to comply.

                  Section 10.13. Tax Sharing Agreements. On the Closing Date,
all Tax sharing agreements and arrangements between (a) Maquiladora, on the one
side, and (b) Seller or any of its Subsidiaries or Affiliates, on the other
side, will be terminated and have no further effect for any taxable year or
period (whether a past, present or future year or period), and no additional
payments will be made thereunder on or after the Closing Date in respect of a
redetermination of Tax liabilities or otherwise.

                  Section 10.14. Dispute Resolution. Any dispute, claim or
controversy arising out of or relating to any provision of ARTICLE X of this
Agreement will be resolved in accordance with the procedures set forth in
Section 12.3(b) of this Agreement, provided that each such mediator or
arbitrator selected pursuant to such procedures shall have an expertise in Tax
matters.


                                   ARTICLE XI

                                   TERMINATION


                  Section 11.1. Voluntary Termination. This Agreement may be
terminated and the transactions contemplated hereby may be abandoned at any time
prior to the Closing Date by the mutual written consent of Purchaser and Seller.

                  Section 11.2. Automatic Termination. In the event of a
termination of the Merger Agreement, this Agreement shall automatically and
immediately terminate.

                  Section 11.3. Effect of Termination. In the event of the
termination of this Agreement, all further obligations of the Parties hereunder
shall terminate, and the transactions contemplated hereby shall be abandoned
without further action or liability by any of the Parties hereto, except that
(i) Section 11.3 ("Effect of Termination"), Section 12.2 ("Notices"), Section
12.3 ("Choice of Law, Dispute Resolution"), Section 12.6 ("Entire Agreement;
Waivers"), Section 12.8 ("Severability"), Section 12.10 ("Expenses"), Section
12.12 ("Parties in Interest") and Section 12.14 ("Controlling Agreement") shall
survive such termination and (ii) nothing shall relieve any Party hereto from
liability for any breach of this Agreement prior to such termination.


                                       48
<PAGE>
                                   ARTICLE XII

                                  MISCELLANEOUS


                  Section 12.1. Assignment. No Party to this Agreement will
convey, assign or otherwise transfer any of its rights or obligations under this
Agreement without the prior written consent of the other Party in its sole and
absolute discretion. Notwithstanding the foregoing, any Party may (without
obtaining any consent) assign, delegate or sublicense all or any portion of its
rights and obligations hereunder to (i) the surviving entity resulting from a
merger or consolidation involving such Party, (ii) the acquiring entity in a
sale or other disposition of (A) all or substantially all of the assets of such
Party as a whole, (B) any line of business or division of such Party, or (C), in
the case of Purchaser, the Facility, (iii) any other Person that is created as a
result of a spin-off from, or similar reorganization transaction of, such Party
or any line of business or division of such Party or (iv) an Affiliate. In the
event of an assignment pursuant to (ii) or (iii) above, the non-assigning Party
shall, at the assigning Party's request, use good faith commercially reasonable
efforts to enter into separate agreements with each of the resulting entities
and take such further actions as may be reasonably required to assure that the
rights and obligations under this Agreement are preserved, in the aggregate, and
divided equitably between such resulting entities. Any conveyance, assignment or
transfer requiring the prior written consent of another Party pursuant to this
Section 12.1 which is made without such consent will be void ab initio. No
assignment of this Agreement will relieve the assigning Party of its obligations
hereunder.

                  Section 12.2. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed duly given (a) on the date of
delivery if delivered personally, (b) upon confirmation of receipt if delivered
by telecopy or telefacsimile, (c) on the first Business Day following the date
of dispatch if delivered by a recognized next-day courier service, or (d) on the
fifth Business Day following the date of mailing if delivered by registered or
certified mail, return receipt requested, postage prepaid. All notices hereunder
shall be delivered as set forth below, or pursuant to such other instructions as
may be designated in writing by the Party to receive such notice:

                  If to Purchaser, to:

                           Alpha Industries, Inc.
                           20 Sylvan Road
                           Woburn, MA  01801
                           Fax:         (617) 824-4564
                           Attention:   Paul E. Vincent
                                        Chief Financial Officer


                                       49
<PAGE>
                           With copies to (not effective for purposes of
notice):

                           Alpha Industries, Inc.
                           20 Sylvan Road
                           Woburn, MA  01801
                           Fax:         (617) 824-4564
                           Attention:   James K. Jacobs, Esq.
                                        General Counsel

                  or if to Seller, to:

                           Conexant Systems, Inc.
                           4311 Jamboree Road
                           Newport Beach, California  92660-3095
                           Fax:         (949) 483-6388
                           Attention:   Dennis E. O'Reilly
                                        Senior Vice President, General
                                          Counsel and Secretary

                           With a copy to (not effective for purposes of
notice):

                           Chadbourne & Parke LLP
                           30 Rockefeller Plaza
                           New York, New York 10112
                           Fax:         (212) 541-5369
                           Attention:   Peter R. Kolyer, Esq.


                  Section 12.3. Choice of Law; Dispute Resolution.

                  (a) Choice of Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware (without giving
effect to choice of law principles).

                  (b) Dispute Resolution. In the event that from and after the
Closing, any dispute, claim or controversy (collectively, a "Dispute") arises
out of or relates to any provision of this Agreement or the breach, performance,
enforcement or validity or invalidity thereof, the designees of Seller's Chief
Executive Officer and Purchaser's Chief Executive Officer will attempt a good
faith resolution of the Dispute within thirty (30) days after either Party
notifies the other Party in writing of the Dispute. If the Dispute is not
resolved within thirty (30) days of the receipt of the notification, or within
such other time as they may agree, the Dispute will be referred for resolution
to Seller's Chief Executive Officer and Purchaser's Chief Executive Officer.
Should they be unable


                                       50
<PAGE>
to resolve the Dispute within thirty (30) days following the referral to them,
or within such other time as they may agree, Seller and Purchaser will then
attempt in good faith to resolve such Dispute by mediation in accordance with
the then-existing CPR Mediation Procedures promulgated by the CPR Institute for
Dispute Resolution, New York City. If such mediation is unsuccessful within
thirty (30) days (or such other period as the Parties may mutually agree) after
the commencement thereof, such Dispute shall be submitted by the Parties to
binding arbitration, initiated and conducted in accordance with the
then-existing American Arbitration Association Commercial Arbitration Rules,
before a single arbitrator selected jointly by Seller and Purchaser, who shall
not be the same person as the mediator appointed pursuant to the preceding
sentence. If Seller and Purchaser cannot agree upon the identity of an
arbitrator within ten (10) days after the arbitration process is initiated, then
the arbitration will be conducted before three arbitrators, one selected by
Seller, one selected by Purchaser and the third selected by the first two. The
arbitration shall be conducted in San Francisco, California and shall be
governed by the United States Arbitration Act, 9 U.S.C. Sections 1-16, and
judgment upon the award may be entered by any court having jurisdiction thereof.
The arbitrators shall have case management authority and shall resolve the
Dispute in a final award within one hundred eighty (180) days from the
commencement of the arbitration action, subject to any extension of time thereof
allowed by the arbitrators upon good cause shown.

                  Section 12.4. Survival of Representations and Warranties and
Covenants. The respective representations and warranties of the Parties
contained in this Agreement (other than those set forth in the following
sentence) will survive the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby and the Closing and will
continue in full force and effect until six (6) months after the Closing Date
and will then expire. The representations and warranties of the Parties
contained in Section 3.1, Section 3.2, Section 3.3, Section 3.4, Section 3.9(a),
Section 3.13, Section 3.17, Section 4.1, Section 4.2, and Section 4.3 will
survive the execution and delivery of this Agreement, the consummation of the
transactions contemplated hereby and the Closing and will continue in full force
and effect until all applicable statutes of limitation (including any extensions
thereof) have expired and will then expire. All covenants of the Parties
contained in this Agreement will remain in full force and effect after, and
survive, the Closing (other than those to be performed at or prior to the
Closing).

                  Section 12.5. Limitations on Representations and Warranties.
Except for the representations and warranties set forth in this Agreement, the
Shares and the Minority Shares are being sold "AS IS, WHERE IS, AND WITH ALL
FAULTS." EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES SET FORTH IN THIS
AGREEMENT, SELLER MAKES NO REPRESENTATIONS OR WARRANTIES WHATSOEVER CONCERNING
THE FACILITY, THE BUSINESS


                                       51
<PAGE>
OR OPERATIONS OF MAQUILADORA OR ANY OTHER MATTER, EXPRESS OR IMPLIED, ORAL, OR
WRITTEN. SELLER HEREBY SPECIFICALLY DISCLAIMS THE IMPLIED WARRANTY OF
MERCHANTABILITY AND THE IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE.

                  Section 12.6. Entire Agreement; Waivers. This Agreement,
together with all exhibits and Schedules hereto, and the other agreements and
instruments of the Parties delivered in connection herewith constitute the
entire agreement and supersede all prior agreements and understandings both
written and oral, among the Parties with respect to the subject matter hereof.
The failure of any Party to this Agreement to assert any of its rights under
this Agreement or otherwise shall not constitute a waiver of those rights.

                  Section 12.7. Counterparts. This Agreement may be executed in
separate counterparts, each such counterpart being deemed to be an original
instrument, and all such counterparts will together constitute the same
agreement. This Agreement may be executed and delivered by telecopier with the
same force and effect as if it were a manually executed and delivered
counterpart.

                  Section 12.8. Severability. If any provision of this Agreement
or the application thereof to any Person or circumstance is determined by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remaining provisions hereof, or the application of such provision to Persons or
circumstances other than those as to which it has been held invalid or
unenforceable, will remain in full force and effect and will in no way be
affected, impaired or invalidated thereby. If the economic or legal substance of
the transactions contemplated hereby is affected in any manner adverse to any
Party as a result thereof, the Parties will negotiate in good faith in an effort
to agree upon a suitable and equitable substitute provision to effect the
original intent of the Parties.

                  Section 12.9. Headings. The headings of the Articles and
Sections herein are inserted for convenience of reference only and are not
intended to be a part of or to affect the meaning or interpretation of this
Agreement.

                  Section 12.10. Expenses. Except as otherwise provided in this
Agreement, each of the Parties shall be liable for its own expenses incurred in
connection with the negotiation, preparation, execution and performance of this
Agreement prior to Closing.

                  Section 12.11. Amendments. This Agreement cannot be amended,
modified or supplemented except by a written agreement executed by Seller and
Purchaser.


                                       52
<PAGE>
                  Section 12.12. Parties in Interest. This Agreement is binding
upon and is for the benefit of the Parties hereto and their respective
successors and permitted assigns. This Agreement is not made for the benefit of
any Person not a Party hereto, and no Person other than the Parties hereto or
their respective successors and permitted assigns will acquire or have any
benefit, right, remedy or claim under or by reason of this Agreement, except
that the provisions of Sections 9.1, 9.2 and 10.6 hereof shall inure to the
benefit of the Persons referred to therein.

                  Section 12.13. Schedules and Exhibits. Inclusion of an item or
matter on any of the Schedules or Exhibits attached hereto shall not be deemed
to be an admission by any Party that such item or matter is required to be
disclosed in such Schedule or Exhibit. Each disclosure on each Schedule, to the
extent specified therein, qualifies the correspondingly numbered representation
and warranty or covenant contained herein and, to the extent it is apparent on
the face of such disclosure that such disclosure qualifies another
representation or warranty contained herein, such other representation and
warranty.

                  Section 12.14. Controlling Agreement. In the event of any
inconsistency between the provisions of this Agreement and those of either
Seller's Contrato de Compra-Venta de Acciones or Minority Shareholder's Contrato
de Compra-Venta de Acciones, this Agreement shall be controlling (other than
with respect to the governing law).

                  Section 12.15. Compliance with Bulk Sales Laws. The Parties
hereby waive compliance with the bulk sales laws and any other similar laws in
any applicable jurisdiction in respect of the transactions contemplated by this
Agreement.

                  Section 12.16. Cooperation Following the Closing. Following
the Closing, the Parties shall each deliver to the other such further
information and documents and shall execute and deliver to the other such
further instruments and agreements as the other shall reasonably request to
consummate or confirm the transactions provided for in this Agreement, to
accomplish the purpose of this Agreement or to assure to the other the benefits
of this Agreement.


[The remainder of this page is left intentionally blank; signature page follows]


                                       53
<PAGE>
                  IN WITNESS WHEREOF, each of the Parties listed below has
executed this Mexican Stock Purchase Agreement as of the day and year first
above written.



                                CONEXANT SYSTEMS, INC.


                                By:   /s/ Dennis E. O'Reilly
                                      -----------------------------------------
                                      Name:    Dennis E. O'Reilly
                                      Title:   Senior Vice President, General
                                      Counsel and Secretary


                                ALPHA INDUSTRIES, INC.


                                By:   /s/ Paul E. Vincent
                                      ------------------------------------
                                      Name:    Paul E. Vincent
                                      Title:   Vice President, Chief Financial
                                      Officer, Treasurer and Secretary




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-2.4
<SEQUENCE>5
<FILENAME>b43517ssexv2w4.txt
<DESCRIPTION>AMENDED & RESTATED MEXICAN ASSET PURCHASE AGRMNT
<TEXT>
<PAGE>

                                                                     EXHIBIT 2.4




================================================================================


              AMENDED AND RESTATED MEXICAN ASSET PURCHASE AGREEMENT

                            DATED AS OF JUNE 25, 2002

                                 BY AND BETWEEN

                             CONEXANT SYSTEMS, INC.

                                       AND

                             ALPHA INDUSTRIES, INC.


================================================================================
<PAGE>
                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                                Page No.
                                                                                -------
<S>                                                                             <C>
ARTICLE I           DEFINITIONS ............................................       1


ARTICLE II          SALE AND PURCHASE OF ASSETS ............................      11

     Section 2.1.   Purchase and Sale of Assets ............................      11
     Section 2.2.   Purchase Price .........................................      11
     Section 2.3.   Assumption of Liabilities ..............................      11
     Section 2.4.   Allocation of Purchase Price ...........................      11

ARTICLE III         SELLER'S REPRESENTATIONS AND WARRANTIES ................      12

     Section 3.1.   Corporate Status, Good Standing and Authorization ......      12
     Section 3.2.   Authority; Enforceability ..............................      12
     Section 3.3.   Consents; No Conflicts or Violations ...................      12
     Section 3.4.   Permits ................................................      13
     Section 3.5.   Compliance with Laws ...................................      13
     Section 3.6.   Absence of Certain Changes or Events ...................      14
     Section 3.7.   Litigation .............................................      14
     Section 3.8.   Tax Matters ............................................      14
     Section 3.9.   Assumed Contracts ......................................      15
     Section 3.10.  No Brokers .............................................      15
     Section 3.11.  Title to Properties ....................................      15
     Section 3.12.  Sufficiency of Assets ..................................      15
     Section 3.13.  Insurance ..............................................      15

ARTICLE IV          PURCHASER'S REPRESENTATIONS AND WARRANTIES .............      16

     Section 4.1.   Organization of Purchaser ..............................      16
     Section 4.2.   Authority; Enforceability ..............................      16
     Section 4.3.   Consents; No Conflicts or Violations ...................      16
     Section 4.4.   Litigation .............................................      17
     Section 4.5.   No Brokers .............................................      17

ARTICLE V           COVENANTS ..............................................      17

     Section 5.1.   Access .................................................      17
     Section 5.2.   Reasonable Best Efforts ................................      19
     Section 5.3.   Conduct of Business by Seller ..........................      20
     Section 5.4.   Supplements to Schedules ...............................      21
     Section 5.5.   Insurance ..............................................      21
</TABLE>


                                        i
<PAGE>
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ARTICLE VI          CONDITIONS TO SELLER'S AND PURCHASER'S OBLIGATIONS .....      23

     Section 6.1.   HSR Act ................................................      23
     Section 6.2.   Mexican Competition Commission Approval ................      23
     Section 6.3.   No Injunctions or Restraints, Illegality ...............      23
     Section 6.4.   Completion of the Merger ...............................      24
     Section 6.5.   Completion of the Stock Purchase .......................      24

ARTICLE VII         ADDITIONAL CONDITIONS TO SELLER'S AND PURCHASER'S
                     OBLIGATIONS ...........................................      24

     Section 7.1.   Conditions to Seller's Obligations .....................      24
     Section 7.2.   Conditions to Purchaser's Obligations ..................      25

ARTICLE VIII        CLOSING ................................................      25

     Section 8.1.   Deliveries by Seller ...................................      25
     Section 8.2.   Deliveries by Purchaser ................................      26

ARTICLE IX          INDEMNIFICATION ........................................      26

     Section 9.1.   Indemnification by Seller ..............................      26
     Section 9.2.   Indemnification by Purchaser ...........................      27
     Section 9.3.   Limitations on Indemnification Obligations .............      27
     Section 9.4.   Procedures Relating to Indemnification .................      29
     Section 9.5.   Sole and Exclusive Remedy ..............................      31
     Section 9.6.   Termination of Indemnification Obligations .............      31
     Section 9.7.   Effect of Investigation ................................      31
     Section 9.8.   Tax Matters ............................................      32

ARTICLE X           TAX MATTERS ............................................      32

     Section 10.1.  Preparation and Filing of Tax Returns ..................      32
     Section 10.2.  Consistent with Past Practice ..........................      32
     Section 10.3.  Payment of Taxes .......................................      32
     Section 10.4.  Allocation of Straddle Period Taxes ....................      32
     Section 10.5.  Tax Refunds and Carrybacks .............................      33
     Section 10.6.  Tax Indemnification ....................................      34
     Section 10.7.  Notice of Indemnity ....................................      35
     Section 10.8.  Payments ...............................................      35
     Section 10.9.  Tax Contests ...........................................      36
     Section 10.10. Cooperation and Exchange of Information ................      36
     Section 10.11. Mexican Income Taxes; Customs Duties; Advanced
                     Pricing Agreement; Transfer, Sales and Use Taxes ......      36
     Section 10.12. Tax Records ............................................      39
     Section 10.13. Dispute Resolution .....................................      39
</TABLE>


                                       ii
<PAGE>
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ARTICLE XI          TERMINATION ............................................      40

     Section 11.1.  Voluntary Termination ..................................      40
     Section 11.2.  Automatic Termination ..................................      40
     Section 11.3.  Effect of Termination ..................................      40

ARTICLE XII         MISCELLANEOUS ..........................................      40

     Section 12.1.  Assignment .............................................      40
     Section 12.2.  Notices ................................................      41
     Section 12.3.  Choice of Law; Dispute Resolution ......................      42
     Section 12.4.  Survival of Representations and Warranties and Covenants      43
     Section 12.5.  Limitations on Representations and Warranties ..........      43
     Section 12.6.  Entire Agreement; Waivers ..............................      43
     Section 12.7.  Counterparts ...........................................      43
     Section 12.8.  Severability ...........................................      43
     Section 12.9.  Headings ...............................................      44
     Section 12.10. Expenses ...............................................      44
     Section 12.11. Amendments .............................................      44
     Section 12.12. Parties in Interest ....................................      44
     Section 12.13. Schedules and Exhibits .................................      44
     Section 12.14. Compliance with Bulk Sales Laws ........................      44
     Section 12.15. Savings Clause .........................................      44
     Section 12.16. Cooperation Following the Closing ......................      45
</TABLE>


                                      iii
<PAGE>
              AMENDED AND RESTATED MEXICAN ASSET PURCHASE AGREEMENT


            AMENDED AND RESTATED MEXICAN ASSET PURCHASE AGREEMENT (this
"Agreement"), dated as of June 25, 2002, by and between Conexant Systems, Inc.,
a Delaware corporation ("Seller"), and Alpha Industries, Inc., a Delaware
corporation ("Purchaser"). Seller and Purchaser are sometimes hereinafter
collectively referred to as the "Parties" and individually as a "Party."

                                    RECITALS

            A. Seller and Purchaser are parties to an agreement (the "Existing
Agreement"), pursuant to which Seller agreed to sell, and Purchaser agreed to
purchase (directly or indirectly), certain tangible personal property located at
the Facility (as defined below), including machinery and equipment, that is used
by Maquiladora (as defined below) owned by Seller in the conduct of its business
and Seller is a party to certain contracts relating to Maquiladora.

            B. Seller and Purchaser wish to amend the Existing Agreement.

            C. Concurrently herewith, Seller and Purchaser are entering into a
Mexican Stock Purchase Agreement (the "Mexican Stock Purchase Agreement"),
pursuant to which Seller is selling, and Purchaser is purchasing, all of
Seller's right, title and interest in and to the shares of capital stock of
Maquiladora owned by Seller.

            D. Seller desires to sell all of Seller's right, title and interest
in and to the Assets (as defined herein), and Purchaser desires to purchase the
Assets, all in accordance with the terms of this Agreement.


                                    AGREEMENT

            NOW, THEREFORE, in consideration of the representations, warranties,
mutual covenants and promises contained herein and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Parties hereby agree as follows:

                                   ARTICLE I

                                   DEFINITIONS

            As used in this Agreement, the following terms shall have the
meanings given those terms in this ARTICLE I or in the Section of this Agreement
referenced in
<PAGE>
the definition provided for such term and all references to "the date of this
Agreement", "the date hereof", "a recent date" or similar references shall refer
or relate to the date as of which the Existing Agreement was originally executed
and delivered (December 16, 2001) and not the date as of which this Agreement
was amended and restated (June 25, 2002):

            "Actually Realized" shall mean, for purposes of determining the
timing of any Taxes (or related Tax cost or benefit) relating to any payment,
transaction, occurrence or event, the time at which the amount of Taxes
(including estimated Taxes) payable by any Person is increased above or reduced
below, as the case may be, the amount of Taxes that such person would be
required to pay but for the payment, transaction, occurrence or event.

            "Advanced Pricing Agreement" means the proposed transfer pricing
agreement among, Seller, Maquiladora, the United States Internal Revenue Service
and certain Mexican Tax authorities for transactions between Seller and
Maquiladora for the annual tax periods of Maquiladora commencing January 1, 2000
through January 1, 2004, which has been submitted to the United States Internal
Revenue Service and the appropriate Mexican Tax authorities.

            "Affiliate" of a Person means any other Person that, directly or
indirectly, controls, is controlled by, or is under common control with, such
Person. The term "control" (including, with correlative meaning, the terms
"controlled by" and "under common control with"), as used with respect to any
Person, means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise.

            "Agreement" is defined in the first paragraph hereof.

            "Assets" means all of Seller's right, title and interest in and to
(i) all tangible personal property (other than computer data, documents,
information, files, books and records), including Equipment, owned by Seller and
located at the Facility on the date hereof and used by Maquiladora in the
conduct of its business, together with prepaid expenses paid by Seller with
respect to such tangible personal property and all third party insurance
proceeds (if any) in respect of losses, liabilities or damage with respect to
such property arising out of insured incidents occurring after the date hereof
and prior to the Closing (to the extent Seller and its Affiliates have no
obligation to reimburse the insurer for such insurance proceeds), (ii) all
tangible personal property (other than computer data, documents, information,
files, books and records) owned by Seller and located at the Facility on the
Closing Date and used by Maquiladora in the conduct of its business which is
acquired by Seller after the date hereof and prior to the Closing and all third
party insurance proceeds (if any) in respect of losses, liabilities or


                                       2
<PAGE>
damage with respect to such property arising out of insured incidents occurring
after the date hereof and prior to the Closing (to the extent Seller and its
Affiliates have no obligation to reimburse the insurer for such insurance
proceeds), (iii) the Assumed Contracts, (iv) the Books and Records and (v) all
third party insurance proceeds (if any) in respect of losses, liabilities or
damage with respect to the assets or properties of Maquiladora arising out of
insured incidents occurring after the date hereof and prior to the Closing (to
the extent Seller and its Affiliates have no obligation to reimburse the insurer
for such insurance proceeds), but, in each case, excluding (I) the Excluded
Assets and (II) all tangible personal property owned by Seller located at the
Facility and used by Maquiladora in the conduct of its business which is sold or
otherwise disposed of by Seller in the ordinary course of business consistent
with past practice and the terms of this Agreement from and after the date
hereof and prior to the Closing (and all insurance proceeds related to such
property). For clarification purposes, the term Assets does not include any
intangible property subject to Section 367(d) of the Internal Revenue Code
(other than any foreign goodwill, going concern value or operating intangibles
(within the meaning of Treas. Reg. Section 1.367(a) - 1T(d)(5)(ii) and (iii)).

            "Assets Promissory Note" means a promissory note issued by
Maquiladora in favor of Seller in a principal amount equal to the portion of the
Purchase Price allocated to the Assets pursuant to Section 2.4, substantially in
the form attached hereto as Exhibit "A".

            "Assumed Contracts" means all contracts listed on Schedule 3.9 and
all contracts (including purchase orders) of Seller relating to the Assets or
entered into on behalf of Maquiladora (to the extent related to the Assets)
which are entered into after the date hereof and prior to the Closing in the
ordinary course of business consistent with past practice and the terms of this
Agreement.

            "Assumed Liabilities" is defined in Section 2.3.

            "Books and Records" means all documents, information, computer data,
files, books and records (in each case, in whatever form or media, including
electronic media) owned by Seller that relate to the Assets, but excluding any
documents, information, files, books and records pertaining to any Excluded
Assets or Excluded Liabilities.

            "Business Day" means a day other than a Saturday, a Sunday or a day
on which banks are required or authorized to close in the City of New York.

            "Charter Document" means any of the certificate of incorporation,
bylaws, agreement of limited partnership, operating agreement or other
organizational or constitutive document of a Person (including, in the case of a
Mexican Person, the acta constitutiva or estatutos of such Person).


                                       3
<PAGE>
            "Claim(s)" means any action, suit, litigation, proceeding,
arbitration or other method of settling disputes or disagreements and any
grievance, complaint, claim, charge, demand, investigation or other similar
matter.

            "Claims Made Policies" is defined in Section 5.5(b).

            "Closing" means the consummation of the transactions contemplated by
this Agreement on the Closing Date.

            "Closing Material Adverse Effect" means any event, change,
circumstance or development that is materially adverse to (i) the ability of
Seller to consummate the transactions contemplated by this Agreement, the
Mexican Stock Purchase Agreement and the Merger Agreement or (ii) the business,
financial condition or results of operations of Maquiladora, the business,
financial condition or results of operations of the Washington Business and the
Assets taken as a whole, other than, with respect to clause (ii), any event,
change, circumstance or development (A) resulting from any action taken in
connection with the transactions contemplated hereby pursuant to the terms of
this Agreement or the Merger Agreement, (B) relating to the economy or financial
markets in general, (C) relating in general to the industries in which Seller,
Maquiladora and the Washington Business operate and not specifically relating to
Seller, Maquiladora and the Washington Business or (D) relating to any action or
omission of Seller, Maquiladora or Washington or any Subsidiary of any of them
taken with the express prior written consent of Purchaser.

            "Closing Date" is defined in the first paragraph of ARTICLE VIII.

            "Code" means the United States Internal Revenue Code of 1986, as
amended.

            "Consent(s)" means any and all consents, waivers, approvals,
authorizations, declarations, filings, recordings, registrations or exemptions.

            "Damages" means any and all losses, Liabilities, claims, damages,
deficiencies, obligations, fines, payments, Taxes, Encumbrances, and costs and
expenses, whether matured or unmatured, absolute or contingent, accrued or
unaccrued, liquidated or unliquidated, known or unknown, whenever arising and
whether or not resulting from Third Party Claims (including the costs and
expenses of any and all Claims; all amounts paid in connection with any demands,
assessments, judgments, settlements and compromises relating thereto; interest
and penalties with respect thereto; out-of-pocket expenses and reasonable
attorneys', accountants' and other experts' fees and expenses reasonably
incurred in investigating, preparing for or defending against any such Claims or
in asserting, preserving or enforcing an Indemnified Party's rights hereunder;
and any losses that may result from the granting of injunctive relief as a
result of any such Claims).


                                       4
<PAGE>
            "Dispute" is defined in Section 12.3(b).

            "dollars" or "U.S.$" means United States dollars.

            "Effective Time" is defined in the Merger Agreement.

            "Encumbrance" means any lien, pledge, easement, security interest,
mortgage, deed of trust, right-of-way, retention of title agreement or other
encumbrance of whatever nature.

            "Equipment" means machinery, equipment, furniture, furnishings,
fixtures and other tangible personal property (except Inventory and Books and
Records), including, data processing equipment, motor vehicles, dies, tools,
jigs and office equipment, together with all components and auxiliary parts and
supplies used in connection therewith, and all manuals, drawings, instructions,
warranties and rights with respect thereto.

            "Excluded Assets" means the assets specifically set forth on
Schedule 2.1(a), including all Inventory and any and all Intellectual Property
of Seller.

            "Excluded Liabilities" is defined in Section 2.3.

            "Existing Agreement" is defined in the recitals hereto.

            "Facility" means the Land and Improvements, including all easements,
licenses, options, insurance proceeds and condemnation awards and all other
rights of Maquiladora in or appurtenant thereto.

            "Financing Agreement" means the Financing Agreement to be dated as
of the Closing Date among Purchaser, each of Purchaser's subsidiaries listed
therein (including, upon the Closing, Maquiladora) and Seller, substantially in
form attached hereto as Exhibit "B".

            "Governmental Authority" means any federal, state or local
governmental authority or regulatory body of any nation (including the United
States of America and the United Mexican States ("Mexico")), any subdivision,
agency, commission, board or authority or instrumentality thereof, or any
quasi-governmental or private body asserting, exercising or empowered to assert
or exercise any regulatory authority thereunder and any Person, directly or
indirectly, owned by and subject to the control of any of the foregoing.

            "HSR Act" means the Hart Scott Rodino Antitrust Improvements Act of
1976, as amended.


                                       5
<PAGE>
            "Improvements" means all buildings, structures, fixtures and real
property improvements located on the Land.

            "including" means including without limiting the generality of what
precedes that term.

            "Indemnified Party" is defined in Section 9.3(a).

            "Indemnifying Party" is defined in Section 9.3(a).

            "Indemnity Issue" is defined in Section 10.7.

            "Indemnity Reduction Amounts" is defined in Section 9.3(a).

            "Information" means all records, books, contracts, instruments,
computer data and other data and information (in each case, in whatever form or
medium, including electronic media).

            "Injunction" is defined in Section 6.3

            "Insurance Proceeds" means monies (a) received by an insured from an
insurance carrier, (b) paid by an insurance carrier on behalf of an insured or
(c) received from any third party in the nature of insurance, contribution or
indemnification in respect of any Liability.

            "Intellectual Property" means trademarks, service marks, brand
names, certification marks, trade dress and other indications of origin, the
goodwill associated with the foregoing and registrations in any jurisdiction of,
and applications in any jurisdiction to register, the foregoing, including any
extension, modification or renewal of any such registration or application;
inventions, discoveries and ideas, whether patentable or not, in any
jurisdiction; patents, applications for patents (including divisions,
continuations, continuations in part and renewal applications), and any
renewals, extensions or reissues thereof, in any jurisdiction; nonpublic
information, trade secrets and confidential information and rights in any
jurisdiction to limit the use or disclosure thereof by any Person; writings and
other works, whether copyrightable or not, in any jurisdiction; and
registrations or applications for registration of copyrights in any
jurisdiction, and any renewals or extensions thereof; and any similar
intellectual property or proprietary rights.

            "Inventory" means all raw materials, components, Semiconductor
Wafers, other inputs, work in process and finished goods.


                                       6
<PAGE>
            "Land" means that certain parcel of land owned by Maquiladora
commonly known as Ave. Iqnacio Lopez Rayon No. 1699, Colonial Rivera, Mexicali,
Baja California, Mexico.

            "Law" means all laws, principals of common law, statutes,
constitutions, treaties, rules, regulations, ordinances, codes, ruling, orders
and determinations of any Governmental Authority.

            "Liabilities" means any and all claims, debts, liabilities,
commitments and obligations of whatever nature, whether fixed, contingent or
absolute, matured or unmatured, liquidated or unliquidated, accrued or not
accrued, known or unknown, due or to become due, whenever or however arising and
whether or not the same would be required by generally accepted accounting
principles to be reflected as a liability in financial statements or disclosed
in the notes thereto.

            "Maquila Decree" is defined in Section 3.5.

            "Maquiladora" means Conexant Systems, S.A. de C.V., a sociedad
anonima de capital variable organized under the laws of Mexico.

            "Material Adverse Change" or "Material Adverse Effect" means any
event, change, circumstance or development that is materially adverse to (i) the
ability of Seller to consummate the transactions contemplated by this Agreement
or the Mexican Stock Purchase Agreement or (ii) the business, financial
condition or results of operations of Maquiladora and the Assets taken as a
whole, other than, with respect to clause (ii), any event, change, circumstance
or development (A) resulting from any action taken in connection with the
transactions contemplated hereby pursuant to the terms of this Agreement, (B)
relating to the economy or financial markets in general, (C) relating in general
to the industries in which Seller and Maquiladora operate and not specifically
relating to Seller and Maquiladora or (D) relating to any action or omission of
Seller or Maquiladora or any Subsidiary of either of them taken with the express
prior written consent of Purchaser.

            "Merger" is defined in the recitals of the Merger Agreement.

            "Merger Agreement" means the Agreement and Plan of Reorganization,
dated as of December 16, 2001, as amended as of April 12, 2002, by and among
Seller, Washington and Purchaser.

            "Mexican Competition Commission" means the Mexican Comision Federal
de Competencia established under Chapter IV of the Mexican Economic Competition
Law.


                                       7
<PAGE>
            "Mexican Economic Competition Law" means the Mexican Ley Federal de
Competencia Economica published in the Mexican Official Gazette (Diario Oficial
de la Federacion) on December 24, 1992.

            "Mexican Stock Purchase Agreement" is defined in the recitals
hereto.

            "Obligation" is defined in the Financing Agreement.

            "Occurrence Basis Policies" is defined in Section 5.9(b).

            "Party" and "Parties" are defined in the first paragraph of this
Agreement.

            "Permits" means licenses, permits, authorizations, consents,
certificates, registrations, variances, franchises and other approvals from any
Governmental Authority, including those relating to environmental matters.

            "Permitted Encumbrance" means (i) in respect of real property,
Encumbrances consisting of zoning or planning restrictions, easements, Permits
or other restrictions or limitations on the use of real property or
irregularities in title thereto which do not materially detract from the value
of, or impair the use of, such real property as currently operated, (ii)
Encumbrances for Taxes, assessments or governmental charges or levies on
property not yet due and payable or which are being contested in good faith and
for which appropriate reserves are maintained, (iii) Encumbrances of landlords,
carriers, warehousemen, mechanics and other Encumbrances imposed by law and
incurred in the ordinary course of business, (iv) for personal property,
Encumbrances for purchase money obligations incurred in the ordinary course of
business consistent with past practice, (v) Encumbrances set forth on Schedule
2.1(b) and (vi) other Encumbrances (other than mortgages, deeds of trust, title
retention agreements or similar security interests on the Facility) which,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.

            "Person" means an individual, corporation, limited liability entity,
partnership, association, trust, unincorporated organization, other entity or
group (as defined in the Exchange Act), including any Governmental Authority.

            "Policies" means all insurance policies, insurance contracts and
claim administration contracts of any kind of Seller relating to the Assets
which were or are in effect at any time at or prior to the Closing, including
primary, excess and umbrella, commercial general liability, fiduciary liability,
product liability, automobile, aircraft, property and casualty, business
interruption, directors and officers liability, employment practices liability,
workers' compensation, crime, errors and omissions, special accident, cargo and
employee dishonesty insurance policies and captive insurance company
arrangements, together with all rights, benefits and privileges thereunder.


                                       8
<PAGE>
            "Privileged Information" means, with respect to a Party, Information
regarding the Party, or any of its operations, employees, assets or Liabilities
(whether in documents or stored in any other form or known to its employees or
agents) that is or may be protected from disclosure pursuant to the
attorney-client privilege, the work product doctrine or other applicable
privileges, that a Party has or may come into possession of or has obtained or
may obtain access to pursuant to this Agreement or otherwise.

            "Purchase Price" is defined in Section 2.2.

            "Purchaser" is defined in the first paragraph of this Agreement.

            "Purchaser Indemnified Parties" is defined in Section 9.1.

            "Representative" means, with respect to any Person, any of such
Person's directors, officers, employees, agents, consultants, advisors,
accountants, attorneys and representatives.

            "Schedules" means the disclosure schedules contained in this
Agreement which schedules are attached hereto and incorporated by reference as
if specifically set forth herein.

            "SECOFI" is defined in Section 3.4.

            "Seller" is defined in the first paragraph of this Agreement.

            "Seller Indemnified Parties" is defined in Section 9.2.

            "Semiconductor Wafers" means silicon and gallium arsenide wafers,
including cut wafers and dies, for the manufacture of semiconductors supplied to
Purchaser by Seller prior to the Closing Date.

            "Shares" is defined in the Mexican Stock Purchase Agreement.

            "Straddle Period" is defined in Section 10.1.

            "Subsidiary" when used with respect to any Person means any
corporation or other organization, whether incorporated or unincorporated, at
least a majority of the securities or other interests of which having by their
terms ordinary voting power to elect a majority of the Board of Directors or
others performing similar functions with respect to such corporation or other
organization is, directly or indirectly, owned or controlled by such Person or
by any one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries.


                                       9
<PAGE>
            "Tax" and "Taxes" shall mean all forms of taxation, whenever created
or imposed, and whether of the United States or elsewhere, and whether imposed
by a federal, state, municipal, governmental, territorial, local, foreign or
other body, and without limiting the generality of the foregoing, shall include
net income, gross income, gross receipts, sales, use, value added, ad valorem,
transfer, recording, franchise, profits, license, lease, service, service use,
payroll, wage, withholding, employment, unemployment insurance, workers
compensation, social security, excise, severance, stamp, business license,
business organization, occupation, premium, property, environmental, windfall
profits, customs, duties, alternative minimum, estimated or other taxes, fees,
premiums, assessments or charges of any kind whatever imposed or collected by
any governmental entity or political subdivision thereof, together with any
related interest and any penalties, additions to such tax or additional amounts
imposed with respect thereto by any Tax authority.

            "Tax Proceeding" means any audit, examination, Claim or other
administrative or judicial proceeding relating to Taxes or Tax Returns.

            "Tax Return" shall mean any return, filing, questionnaire,
information return, election or other document required or permitted to be
filed, including requests for extensions of time, filings made with respect to
estimated tax payments, claims for refund and amended returns that may be filed,
for any period with any Tax authority (whether domestic or foreign) in
connection with any Tax (whether or not a payment is required to be made with
respect to such filing).

            "Third Party Claim" is defined in Section 9.4(a).

            "To the knowledge of Seller" or words of similar import with respect
to a fact or matter means the actual knowledge of the executive officers of
Seller listed on Schedule 1 after reasonable inquiry.

            "U.S. Asset Purchase Agreement" means the U.S. Asset Purchase
Agreement, dated December 16, 2001, by and between Seller and Purchaser, as may
be amended, modified or supplemented from time to time.

            "U.S. GAAP" means generally accepted accounting principles as
applied in the United States as of the date of this Agreement.

            "Washington" means Washington Sub, Inc., a Delaware corporation.

            "Washington Business" is defined in the Merger Agreement.


                                       10
<PAGE>
                                   ARTICLE II

                           SALE AND PURCHASE OF ASSETS

            Section 2.1. Purchase and Sale of Assets. At the Closing, Seller
shall sell, transfer, convey, assign and deliver to Purchaser's designee, and
Purchaser shall cause Purchaser's designee to purchase, acquire and accept, the
Assets, as the same shall exist on the Closing Date, free and clear of any
Encumbrances other than Permitted Encumbrances. Purchaser hereby designates
Maquiladora to purchase the Assets pursuant to this Section 2.1

            Section 2.2. Purchase Price. The purchase price (the "Purchase
Price") to be paid in the aggregate by Purchaser (and Maquiladora as its
designee pursuant to Section 2.1 above) to Seller in consideration for the
Assets shall be eighty million dollars (U.S.$80,000,000), payable, at the
election of Purchaser, either (A) by wire transfer of immediately available
funds at the Closing or (B) by delivery of the Assets Promissory Note at the
Closing; provided, however, that if Purchaser shall elect to pay the Purchase
Price pursuant to clause (B), Purchaser shall provide written notice of such
election to Seller no later than thirty (30) days prior to the Closing Date.

            Section 2.3. Assumption of Liabilities. At the Closing, Purchaser
shall cause Purchasers' designee to unconditionally assume and agree to pay,
perform and discharge in a timely manner and in accordance with their respective
terms those Liabilities of Seller set forth on Schedule 2.3(a) (the "Assumed
Liabilities"). Purchaser's designee shall not assume hereunder any Liabilities
of Seller related to the Assets that are not Assumed Liabilities (the "Excluded
Liabilities"). Purchaser hereby designates Maquiladora to assume the Assumed
Liabilities pursuant to this Section 2.3.

            Section 2.4. Allocation of Purchase Price. Purchaser and Seller
mutually agree that the Purchase Price and the Assumed Liabilities hereunder
shall be allocated among the Assets in the manner required by Section 1060 of
the Code and Treasury Regulations promulgated thereunder. Purchaser and Seller
shall agree upon such allocation prior to the Closing and shall file Form 8594
with the United States Internal Revenue Service reflecting such allocation.
Neither Seller nor Purchaser shall take a position inconsistent with such
allocation in any Tax Proceeding, in any refund claim, in any litigation or
investigation or otherwise. If a competent Government Authority adjusts such
allocation for any reason, the allocation shall be deemed to be amended to
conform to any such adjustments.


                                       11
<PAGE>
                                  ARTICLE III

                     SELLER'S REPRESENTATIONS AND WARRANTIES

            Seller hereby represents and warrants to Purchaser as of the date
hereof and as of the Closing Date the following:

            Section 3.1. Corporate Status, Good Standing and Authorization.
Seller is a corporation duly incorporated, validly existing and in good standing
under the laws of its jurisdiction of incorporation, with all requisite
corporate power and authority to own the Shares and the Assets, except where the
failure to have such power and authority, individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect. Seller and
Maquiladora are each duly licensed or qualified to do business as a foreign
corporation in all states or jurisdictions in which the nature of its business
requires such license or qualification, except where the failure to be so
licensed or qualified, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect.

            Section 3.2. Authority; Enforceability. Seller has all requisite
corporate power and authority to enter into this Agreement and perform its
obligations under this Agreement. The execution, delivery and performance of
this Agreement by Seller and the consummation by Seller of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the part of Seller. This Agreement has been duly authorized, executed and
delivered by Seller and is a legally valid and binding obligation of Seller
(assuming that this Agreement constitutes the valid and binding obligation of
Purchaser) and is enforceable against Seller in accordance with its terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium and similar Laws relating to
or affecting creditors generally or by general equity principles (regardless of
whether such enforceability is considered in a proceeding in equity or at law).

            Section 3.3. Consents; No Conflicts or Violations. Except for the
Consents set forth on Schedule 3.3 and Consents which if not obtained and
maintained by Seller, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect, there are no Consents of any
Governmental Authority required in connection with (i) Seller's execution and
delivery of this Agreement and the other agreements, documents and instruments
to be executed and delivered by Seller in connection herewith or (ii) the
performance by Seller of its obligations herein or therein or the consummation
by Seller of the transactions contemplated hereby or thereby. Assuming receipt
of all of the Consents set forth on Schedule 3.3 (including any required HSR Act
approval, any approval required by the Mexican Competition Commission under the
Mexican Economic Competition Law and any approval by SECOFI (as defined below)
of any change of any Permits held by Maquiladora), neither the execution or


                                       12
<PAGE>
delivery by Seller of this Agreement nor the consummation by Seller of the
transactions contemplated hereby will, with or without the giving of notice or
the lapse of time or both, conflict with or result in a breach or violation of
or give rise to a default or right of termination, amendment, cancellation or
acceleration under (i) any provision of Seller's or Maquiladora's Charter
Documents, (ii) any contract, agreement, note, bond, mortgage, indenture, lease,
license, franchise, permit, concession, instrument or obligation to which Seller
or Maquiladora is a party or by which any of their respective properties or
assets are bound or (iii) any Law or license or other requirement to which
Seller or Maquiladora or their respective properties or assets is subject,
except, in the case of items (ii) and (iii) above only, for those which,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.

            Section 3.4. Permits. Seller and Maquiladora have or will have as of
the Closing all Permits which are required in order to allow Seller to own the
Shares and to own and use the Assets in the manner in which it currently owns
and uses such Assets or which are required in order to allow Maquiladora to own
its assets and properties and to conduct its business as conducted as of the
date hereof, including all Permits required from the Mexican Ministry of
Commerce and Industrial Promotion ("SECOFI") or its successor, the Mexican
Ministry of the Economy, except, in any such case, for such Permits, which if
not obtained or maintained, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect. Each of Seller and
Maquiladora is and will be in compliance with each such Permit, except where the
failure to so comply, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect. No suspension or cancellation of any
such Permits is or will be pending or, to the knowledge of Seller, threatened,
except for suspensions or cancellations which, individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect. Seller will
have delivered to Purchaser at or prior to Closing a list of all such Permits
held or obtained as of the Closing Date, except for such Permits, which if not
held or obtained, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect.

            Section 3.5. Compliance with Laws. Except as disclosed on Schedule
3.5, (i) Maquiladora is in compliance in all material respects with all
applicable Laws, including the Decree for the Development and Operation of
Maquiladora Export Industry, as amended (the "Maquila Decree"), (ii) Seller is
in compliance in all material respects with all Laws applicable with respect to
the Assets and the Shares, except in the case of (i) or (ii) above, where the
failure to so comply, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect, and (iii) to the knowledge of
Seller, Maquiladora has not received within the past twelve (12) months any
written notice or correspondence from any Governmental Authority to the effect
that it is not in compliance with any such applicable Laws, except for such
violations which, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect.


                                       13
<PAGE>
            Section 3.6. Absence of Certain Changes or Events. Except as set
forth on Schedule 3.6, since November 23, 2001, there has not been any Material
Adverse Change or any event, change, circumstance or development which,
individually or in the aggregate, would reasonably be expected to have a
Material Adverse Change. Without limiting the generality of the foregoing,
except as set forth on Schedule 3.6, Maquiladora has been operating the Assets
since November 23, 2001 in the ordinary course of business consistent with past
practice (except as may be expressly contemplated by this Agreement).

            Section 3.7. Litigation. Except as set forth on Schedule 3.7, there
is no action, suit or proceeding or regulatory investigation pending or, to the
knowledge of Seller, threatened against Seller, Minority Shareholder or
Maquiladora or its business or operations affecting (i) Maquiladora or its
business or operations, (ii) any of the Assets, (iii) the Purchased Shares or
(iv) this Agreement before any court or arbitrator or any governmental body,
agency or official, except for those which, if adversely determined,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect. None of Seller, Minority Shareholder or Maquiladora is
a party to or subject to any judgment, order, rule, writ, injunction, or decree
of any Governmental Authority or arbitrator which relates to or affects
Maquiladora, the Assets or the Purchased Shares, except as, individually or in
the aggregate, would not reasonably be expected to have a Material Adverse
Effect.

            Section 3.8. Tax Matters.

            (a) Tax Returns. All material Tax Returns required to be filed by
Maquiladora with respect to the Assets have been timely filed. All such Tax
Returns are true, correct and complete, except as, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.
All Taxes shown as due and payable by or with respect to such Tax Returns have
been timely paid in full.

            (b) No Tax Proceedings. Except as set forth on Schedule 3.8(b),
there are no Tax Proceedings presently pending with regard to any Tax Returns or
Taxes related to the Assets, and no notice has been received from any
Governmental Authority of the expected commencement of such a Tax Proceeding.

            (c) No Tax Liens. There are no Encumbrances for any Tax on the
Assets, except for Permitted Encumbrances.

            (d) None of the Assets is a lease made pursuant to Section 168(f)(8)
of the Internal Revenue Code of 1954.

            (e) None of the Assets constitute "tax exempt use property" within
the meaning of Section 168(h) of the Code or is "tax exempt bond financed
property" within the meaning of Section 168(g) of the Code.


                                       14
<PAGE>
            Section 3.9. Assumed Contracts. True and correct copies of all
Assumed Contracts in effect as of the date hereof have been made available to
Purchaser. Prior to Closing, Seller shall have made available to Purchaser all
Assumed Contracts that came into effect after the date hereof. None of Seller
or, to the knowledge of Seller, any other party to any Assumed Contract, is in
default under any Assumed Contract, except for such defaults that, individually
or in the aggregate, would not reasonably be expected to have a Material Adverse
Effect. To the knowledge of Seller, no event has occurred with respect to any
Assumed Contract which, with the lapse of time or the giving of notice or both,
would constitute a default under any Assumed Contract, except for such defaults
that, individually or in the aggregate, would not reasonably be expected to have
a Material Adverse Effect.

            Section 3.10. No Brokers. Neither this Agreement nor the sale of the
Assets was induced or procured through any Person acting on behalf of or
representing Seller and no commissions or any other payment is due to any
intermediary in connection therewith.

            Section 3.11. Title to Properties. Seller has good and valid title
to the Shares and the Assets and Maquiladora has good and valid title to all of
its tangible properties and assets, except, in each case, where the failure to
have such good and valid title, or valid leasehold interest, would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

            Section 3.12. Sufficiency of Assets. After giving effect to the
transfers, conveyances and assignments contemplated by this Agreement, the
Mexican Stock Purchase Agreement, the U.S. Asset Purchase Agreement and the
agreements, documents and instruments executed and delivered pursuant hereto or
thereto and after taking into account any services to be provided to Purchaser
and Maquiladora pursuant to the Transition Services Agreement and the Supply
Agreement, except for the Excluded Assets (other than the Intellectual Property
being assigned pursuant to the U.S. Asset Purchase Agreement) and corporate
services provided by Seller to Maquiladora immediately after the Closing, the
assets of Maquiladora and the Assets will constitute all of the material assets
and rights of Seller and Maquiladora that are necessary to conduct the
operations of Maquiladora substantially as conducted on the date hereof.

            Section 3.13. Insurance. Seller maintains insurance coverage in
respect of the Assets with reputable insurers in such amounts and covering such
risks as is deemed reasonably appropriate for its business (taking into account
the cost and availability of such insurance).


                                       15
<PAGE>
                                   ARTICLE IV

                   PURCHASER'S REPRESENTATIONS AND WARRANTIES

            Purchaser hereby represents and warrants to Seller as of the date
hereof and as of the Closing Date the following:

            Section 4.1. Organization of Purchaser. Purchaser is a corporation
duly incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation.

            Section 4.2. Authority; Enforceability. Purchaser has all requisite
corporate power and authority to enter into this Agreement and perform its
obligations under this Agreement. The execution, delivery and performance of
this Agreement by Purchaser and the consummation by Purchaser of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of Purchaser and the purchase of Assets and
assumption of the Assumed Liabilities by Maquiladora, as Purchaser's designee
have been duly authorized by all necessary corporate action on the part of
Maquiladora. This Agreement has been duly authorized, executed and delivered by
Purchaser and is a legally valid and binding obligation of Purchaser (assuming
that this Agreement constitutes the valid and binding obligation of Seller) and
is enforceable against Purchaser in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium and similar Laws relating to or affecting
creditors generally or by general equity principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

            Section 4.3. Consents; No Conflicts or Violations. Except for the
Consents set forth on Schedule 4.3 and the Consents which if not obtained and
maintained by Purchaser, individually or in the aggregate, would not reasonably
be expected to have a material adverse effect on Purchaser's ability to
consummate the transactions contemplated by this Agreement, there are no
Consents of any Governmental Authorities required in connection with (i)
Purchaser's execution and delivery of this Agreement and the other agreements,
documents and instruments to be executed and delivered by Purchaser in
connection herewith or (ii) the performance by Purchaser of its obligations
herein or therein or the consummation by Seller of the transactions contemplated
hereby or thereby. Assuming receipt of all of the Consents set forth on Schedule
4.3 (including, any required HSR Act approval and any approval required by the
Mexican Competition Commission under the Mexican Economic Competition Law),
neither the execution or delivery by Purchaser of this Agreement nor the
consummation by Purchaser of the transactions contemplated hereby will, with or
without the giving of notice or the lapse of time or both, conflict with or
result in a breach or violation of or give rise to a default or right of
termination, amendment, cancellation or acceleration


                                       16
<PAGE>
under (i) any provision of Purchaser's Charter Documents, (ii) any material
contract, agreement, note, bond, mortgage, indenture, lease, license, franchise,
permit, concession, instrument or obligation to which Purchaser is a party or by
which any of its properties or assets are bound or (iii) any Law or license or
other requirement to which Purchaser or its properties or assets is subject,
except, in the case of items (ii) and (iii) above only, for those which,
individually or in the aggregate, would not reasonably be expected to have a
material adverse effect on Purchaser's ability to consummate the transactions
contemplated by this Agreement.

            Section 4.4. Litigation. Except as set forth on Schedule 4.4, there
is no action, suit or proceeding or regulatory investigation pending or, to the
knowledge of Purchaser, threatened against Purchaser affecting this Agreement
before any court or arbitrator or any governmental body, agency or official,
except for those which, if adversely determined, individually or in the
aggregate, would not reasonably be expected to have a material adverse effect on
Purchaser's ability to consummate the transactions contemplated by this
Agreement. Purchaser is not a party to or subject to any judgment, order, writ,
injunction, or decree of any Governmental Authority or arbitrator, except as,
individually or in the aggregate, would not reasonably be expected to have a
material adverse effect on Purchaser's ability to consummate the transactions
contemplated by this Agreement.

            Section 4.5. No Brokers. Neither this Agreement nor the purchase of
the Assets was induced or procured through any Person acting on behalf of or
representing Purchaser and no commissions or any other payment is due to any
intermediary in connection therewith.

                                   ARTICLE V

                                    COVENANTS

            The Parties hereby covenant as follows:

            Section 5.1. Access.

            (a) Access to Information by Purchaser Prior to Closing. Prior to
Closing, subject to compliance with applicable laws, Seller and Maquiladora
shall, upon reasonable request, afford to Purchaser and its Representatives
reasonable access during normal business hours to all Books and Records.
Purchaser shall coordinate its requests and activities under this Section 5.1
with Seller's need for security and will assist Seller in minimizing disruption
to Maquiladora's normal business operations.

            (b) Access to Information by Purchaser After Closing. From and after
the Closing, Seller will afford to Purchaser and its Representatives (at
Purchaser's


                                       17
<PAGE>
expense) reasonable access and duplicating rights during normal business hours
and upon reasonable advance notice to all Books and Records and all books and
records within Seller's possession or control relating to the Assets, insofar as
such access is reasonably required by Purchaser.

            (c) Access to Books and Records by Seller. Purchaser shall,
following the Closing, give Seller and its Representatives such access, during
normal business hours and upon reasonable prior notice, to the Books and Records
and such other documents as shall be reasonably necessary for Seller in
connection with its performance of its obligations hereunder and for any other
reasonable purposes, and Purchaser will allow Seller and its Representatives to
make extracts and copies thereof as may be necessary for such purposes at
Seller's expense. Purchaser shall preserve and protect the Books and Records
relating to periods prior to the Closing in its possession and control for the
period required by the applicable records retention policy of Seller in effect
immediately prior to the Closing. Purchaser shall offer to deliver the Books and
Records relating to periods prior to the Closing to Seller prior to their
destruction or other disposition.

            (d) Production of Witnesses. Subject to Section 5.1(e), after the
Closing, each Party will, and Purchaser will cause Maquiladora to, make
available to the other Party, upon written request and at the cost and expense
of the Party so requesting, its directors, officers, employees and agents as
witnesses to the extent that any such Person may reasonably be required (giving
consideration to business demands of such directors, officers, employees and
agents) in connection with any Claims or administrative or other proceedings in
which the requesting party may from time to time be involved and relating to the
Assets or arising in connection with the relationship between the Parties on or
prior to the Closing Date, provided that the same shall not unreasonably
interfere with the conduct of business by the Party of which the request is
made.

            (e) Confidentiality. From and after the Closing, each of Seller and
Purchaser shall hold, and shall use reasonable efforts to cause its Affiliates
and Representatives to hold, in strict confidence all Information concerning the
other Party in its possession or control prior to the Closing or furnished to it
by another Party pursuant to the Merger and the transactions contemplated
thereby and will not release or disclose such Information to any other Person,
except its Affiliates and its and their Representatives, who will be bound by
the provisions of this Section 5.1(e); provided, however, that any Person may
disclose such Information to the extent that (a) disclosure is compelled by
judicial or administrative process or, in the opinion of such Person's counsel,
by other requirements of law (in which case the Party required to make such
disclosure will notify the other Party as soon as practicable of such obligation
or requirement and cooperate with the other Party to limit the Information
required to be disclosed and to obtain a protective order or other appropriate
remedy with respect to the


                                       18
<PAGE>
Information ultimately disclosed) or (b) such Person can show that such
Information was (i) available to such Person on a non-confidential basis (other
than from a Party) prior to its disclosure by such Person, (ii) in the public
domain through no fault of such Person or (iii) lawfully acquired by such Person
from another source after the time that it was furnished to such Person by the
other Party or its Affiliates, Representatives or Subsidiaries, and not acquired
from such source subject to any confidentiality obligation on the part of such
source known to the acquiror, or on the part of the acquiror. Each Party
acknowledges that it will be liable for any breach of this Section 5.1(e) by its
Affiliates, Representatives and Subsidiaries. Notwithstanding the foregoing,
each Party will be deemed to have satisfied its obligations under this Section
5.1(e) with respect to any Information (other than Privileged Information) if it
exercises the same care with regard to such Information as it takes to preserve
confidentiality for its own similar Information.

            Section 5.2. Reasonable Best Efforts.

            (a) Subject to the terms and conditions of this Agreement, each
Party will use its reasonable best efforts to take, or cause to be taken, all
actions and to do, or cause to be done, and to assist and cooperate with the
other Party in doing or causing to be done, all things necessary, proper or
advisable under this Agreement and applicable laws to consummate the
transactions contemplated by this Agreement as soon as practicable after the
date hereof, including (i) taking all reasonable actions to cause the conditions
set forth in ARTICLES VI and VII to be satisfied as promptly as practicable,
(ii) preparing and filing as promptly as practicable all documentation to obtain
as promptly as practicable all Consents set forth on Schedules 3.3 and 4.3 and
(iii) taking all reasonable steps as may be necessary to obtain all Consents set
forth on Schedules 3.3 and 4.3. In furtherance and not in limitation of the
foregoing, each Party hereto agrees to make (i) an appropriate filing (if
applicable) of a Notification and Report Form pursuant to the HSR Act and any
comparable filings (if applicable) pursuant to the Mexican Economic Competition
Act with respect to the transactions contemplated hereby as promptly as
practicable after the date hereof and (ii) all other necessary filings with
other Governmental Authorities relating to the transactions contemplated herein,
and, in each case, to supply as promptly as practicable any additional
information and documentary material that may be requested pursuant to such
applicable laws or by such Governmental Authorities and to use reasonable best
efforts to cause the expiration or termination of the applicable waiting periods
under the HSR Act and the Mexican Economic Competition Act and the receipt of
the Consents set forth on Schedules 3.3 and 4.3 under such other applicable laws
or from such Governmental Authorities as soon as practicable.

            (b) Each of Seller and Purchaser shall, in connection with the
efforts referenced in Section 5.2(a) to obtain all Consents set forth on
Schedules 3.3 and 4.3, use its reasonable best efforts to (i) cooperate in all
respects with each other in connection with any filing or submission and in
connection with any investigation or other inquiry,


                                       19
<PAGE>
including any proceeding initiated by a private party, (ii) promptly inform the
other Party of any communication received by such Party from, or given by such
Party to, the Antitrust Division of the Department of Justice (the "DOJ"), the
Federal Trade Commission (the "FTC"), the Mexican Competition Commission or any
other Governmental Authority and of any material communication received or given
in connection with any proceeding by a private party, in each case regarding any
of the transactions contemplated hereby, and (iii) permit the other Party to
review any communication given by it to, and consult with each other in advance
of any meeting or conference with, the DOJ, the FTC, the Mexican Competition
Commission or any such other Governmental Authority or, in connection with any
proceeding by a private party, with any other Person, and to the extent
appropriate or permitted by the DOJ, the FTC, the Mexican Competition Commission
or such other applicable Governmental Authority or other Person, give the other
Party the opportunity to attend and participate in such meetings and
conferences.

            (c) In furtherance and not in limitation of the covenants of the
Parties contained in Section 5.2(a) and Section 5.2(b), if any administrative or
judicial action or proceeding, including any proceeding by a private party, is
instituted (or threatened to be instituted) challenging any transaction
contemplated by this Agreement as violative of any applicable laws, or if any
statute, rule, regulation, executive order, decree, injunction or administrative
order is enacted, entered, promulgated or enforced by a Governmental Authority
which would make transactions contemplated hereby illegal or would otherwise
prohibit or materially impair or delay the consummation of the transactions
contemplated hereby, each of the Parties shall cooperate in all respects with
each other and use its respective reasonable best efforts to contest and resist
any such action or proceeding and to have vacated, lifted, reversed or
overturned any decree, judgment, injunction or other order, whether temporary,
preliminary or permanent, that is in effect and that prohibits, prevents or
restricts consummation of the transactions contemplated by this Agreement and to
have such statute, rule, regulation, executive order, decree, injunction or
administrative order repealed, rescinded or made inapplicable so as to permit
the consummation of the transactions contemplated by this Agreement.

            (d) Notwithstanding the foregoing or any other provision of this
Agreement, nothing in this Section 5.2 shall create an obligation by the Parties
to take any action in addition to the actions required to be taken pursuant to
the Merger Agreement to consummate the Merger.

            Section 5.3. Conduct of Business by Seller. From the date hereof
until the Closing Date, Seller shall (and shall cause Maquiladora to), except as
expressly required or permitted by this Agreement and except as otherwise
consented to in writing by Purchaser:


                                       20
<PAGE>
            (i) employ the Assets in the ordinary course of business consistent
      with past practice;

            (ii) not engage the Assets in any new material line of business;

            (iii) not grant, create, incur or suffer to exist any Encumbrance
      (other than a Permitted Encumbrance granted, created, incurred or suffered
      to exist in the ordinary course of business consistent with past practice)
      on the Assets; and

            (iv) not authorize, or commit or agree to take, any of the foregoing
      actions.

            Section 5.4. Supplements to Schedules. From time to time up to the
Closing, Seller and Purchaser may supplement or amend the Schedules after they
have been delivered pursuant to this Agreement with respect to any matter first
existing or occurring on or after the date hereof which, if existing or
occurring at or prior to the date hereof, would have been required to be set
forth or described in such Schedules or which is necessary to correct any
information in such Schedules which has been rendered inaccurate thereby;
provided, however, that if any facts that give rise to such matter existed or
occurred on or before the date hereof, no such supplement or amendment may be
made under this Section 5.4 with respect thereto. Any such supplement or
amendment to any Schedule shall not, following Closing, constitute a basis for
any Claim for indemnification pursuant to ARTICLE IX; provided, however, that no
such supplement or amendment shall be deemed to cure any breach of any
representations or warranties made pursuant to this Agreement for purposes of
Section 7.1(a) or Section 7.2(a).

            Section 5.5. Insurance.

            (a) Coverage. Subject to the provisions of this Section 5.5,
coverage of the Assets under all Policies shall cease as of the Closing. From
and after the Closing, Purchaser will be responsible for obtaining and
maintaining all insurance coverages for the Assets. All Policies will be
retained by Seller and Seller's Subsidiaries, together with all rights, benefits
and privileges thereunder (including the right to receive any and all return
premiums with respect thereto), except that Purchaser will have the rights in
respect of Policies to the extent described in Section 5.5(b).

            (b) Rights Under Policies. From and after the Closing, Purchaser
will have no rights with respect to any Policies, except that (i) Purchaser will
have the right to assert claims (and Seller will use commercially reasonable
efforts to assist Purchaser in asserting claims) for any loss, liability or
damage with respect to the Assets under Policies with third-party insurers which
are "occurrence basis" insurance policies ("Occurrence Basis Policies") arising
out of insured incidents occurring from the date coverage thereunder first
commenced until the Closing to the extent that the terms and conditions of any
such Occurrence Basis Policies and agreements relating thereto so


                                       21
<PAGE>
allow and (ii) Purchaser will have the right to continue to prosecute claims
with respect to the Assets properly asserted with an insurer prior to the
Closing (and Seller will use commercially reasonable efforts to assist Purchaser
in connection therewith) under Policies with third-party insurers which are
insurance policies written on a "claims made" basis ("Claims Made Policies")
arising out of insured incidents occurring from the date coverage thereunder
first commenced until the Closing to the extent that the terms and conditions of
any such Claims Made Policies and agreements relating thereto so allow,
provided, that in the case of both clauses (i) and (ii) above, (A) all of
Seller's reasonable out-of-pocket costs and expenses incurred in connection with
the foregoing are promptly paid by Purchaser, (B) Seller may, at any time,
without liability or obligation to Purchaser (other than as set forth in Section
5.5(c)), amend, commute, terminate, buy-out, extinguish liability under or
otherwise modify any Occurrence Basis Policies or Claims Made Policies (and such
claims shall be subject to any such amendments, commutations, terminations,
buy-outs, extinguishments and modifications), (C) such claims will be subject to
(and recovery thereon will be reduced by the amount of) any applicable
deductibles, retentions or self-insurance provisions, (D) such claims will be
subject to (and recovery thereon will be reduced by the amount of) any payment
or reimbursement obligations of Seller, any of Seller's Subsidiaries or any
Affiliate of Seller or any of Seller's Subsidiaries in respect thereof and (E)
such claims will be subject to exhaustion of existing aggregate limits. Seller's
obligation to use commercially reasonable efforts to assist Purchaser in
asserting claims under applicable Policies will include using commercially
reasonable efforts in assisting Purchaser to establish its right to coverage
under such Policies (so long as all of Seller's reasonable out-of-pocket costs
and expenses in connection therewith are promptly paid by Purchaser). None of
Seller or Seller's Subsidiaries will bear any Liability for the failure of an
insurer to pay any claim under any Policy. It is understood that any Claims Made
Policies will not provide any coverage to Purchaser for incidents occurring
prior to the Closing but which are asserted with the insurance carrier after the
Closing.

            (c) Seller Actions. In the event that after the Closing, Seller
proposes to amend, commute, terminate, buy-out, extinguish liability under or
otherwise modify any Policies under which Purchaser has rights to assert claims
pursuant to Section 5.5(b) in a manner that would adversely affect any such
rights of Purchaser, (i) Seller will give Purchaser prior notice thereof and
consult with Purchaser with respect to such action (it being understood that the
decision to take any such action will be in the sole discretion of Seller) and
(ii) Seller will pay to Purchaser its equitable share (which shall be determined
by Seller in good faith based on the amount of premiums paid by or allocated to
Purchaser in respect of the applicable Policy) of any net proceeds actually
received by Seller from the insurer under the applicable Policy as a result of
such action by Seller (after deducting Seller's reasonable costs and expenses
incurred in connection with such action).

            (d) Administration. From and after the Closing:


                                       22
<PAGE>
                  (i) Seller or a Subsidiary of Seller, as appropriate, will be
      responsible for the Claims Administration with respect to claims of Seller
      and Seller's Subsidiaries under Policies; and

                  (ii) Purchaser will be responsible for the Claims
      Administration with respect to claims of Purchaser under Policies.

            (e) Insurance Premiums. From and after the Closing, Seller will pay
all premiums (retrospectively-rated or otherwise) as required under the terms
and conditions of the respective Policies in respect of periods prior to the
Closing, whereupon Purchaser will, upon the request of Seller, forthwith
reimburse Seller for that portion of such premiums paid by Seller as are
reasonably determined by Seller to be attributable to the Assets.

            (f) Agreement for Waiver of Conflict and Shared Defense. In the
event that a Policy provides coverage for both Seller and/or a Subsidiary of
Seller, on the one hand, and Purchaser, on the other hand, relating to the same
occurrence, Seller and Purchaser agree to defend jointly and to waive any
conflict of interest necessary to the conduct of that joint defense. Nothing in
this Section 5.5(f) will be construed to limit or otherwise alter in any way the
indemnity obligations of the parties to this Agreement, including those created
by this Agreement, by operation of law or otherwise.

                                   ARTICLE VI

                                  CONDITIONS TO
                      SELLER'S AND PURCHASER'S OBLIGATIONS

            The obligations of Seller and Purchaser to complete the transactions
contemplated by this Agreement are subject to the satisfaction, on or prior to
the Closing, of each of the following conditions precedent; provided, however,
that upon consummation of the Merger, all conditions precedent contained in this
ARTICLE VI shall be deemed fully satisfied for purposes of this ARTICLE VI:

            Section 6.1. HSR Act. The waiting period (and any extension thereof)
applicable to the transactions contemplated by this Agreement under the HSR Act
shall have been terminated or shall have expired.

            Section 6.2. Mexican Competition Commission Approval. Seller and
Purchaser shall have received the required consent or approval of the Mexican
Competition Commission.

            Section 6.3. No Injunctions or Restraints, Illegality. No Laws shall
have been adopted, promulgated or enforced by any Governmental Authority, and no


                                       23
<PAGE>
temporary restraining order, preliminary or permanent injunction or other order
issued by a court or other Governmental Authority of competent jurisdiction (an
"Injunction") shall be in effect, having the effect of making the transactions
contemplated under this Agreement illegal or otherwise prohibiting such
transactions. No proceeding initiated by any Governmental Authority seeking, and
which is reasonably likely to result in the granting of, an Injunction shall be
pending.

            Section 6.4. Completion of the Merger. The Merger shall have been
consummated.

            Section 6.5. Completion of the Stock Purchase. The transactions
contemplated by the Mexican Stock Purchase Agreement and the U.S. Asset Purchase
Agreement shall have been consummated.

                                  ARTICLE VII

                            ADDITIONAL CONDITIONS TO
                      SELLER'S AND PURCHASER'S OBLIGATIONS

            Section 7.1. Conditions to Seller's Obligations. The obligations of
Seller to complete the transactions contemplated by this Agreement are subject
to the satisfaction, on or prior to the Closing, of each of the following
conditions precedent; provided, however, that upon consummation of the Merger,
all conditions precedent contained in this Section 7.1 shall be deemed fully
satisfied for purposes of this ARTICLE VII:

            (a) Representations, Warranties and Covenants. Each of the
representations and warranties of Purchaser contained in this Agreement shall be
true and correct (without giving effect to any qualification or limitation as to
materiality or material adverse effect set forth therein) in each case as of the
date hereof and (except to the extent that such representations and warranties
speak solely as to another date) as of the Closing Date as though made on and as
of the Closing Date, except where the failure of such representations and
warranties to be true and correct, individually or in the aggregate, would not
reasonably be expected to have a material adverse effect on the ability of
Purchaser to consummate the transactions contemplated in this Agreement.

            (b) Performance of Obligations of Purchaser. Purchaser (i) shall
have performed or complied with all agreements and covenants required to be
performed by it under this Agreement at or prior to the Closing Date that are
qualified as to materiality or material adverse effect and (ii) shall have
performed or complied in all material respects with all other agreements and
covenants required to be performed by it under this Agreement at or prior to the
Closing Date that are not so qualified.


                                       24
<PAGE>
            Section 7.2. Conditions to Purchaser's Obligations. The obligations
of Purchaser to complete the transactions contemplated by this Agreement are
subject to the satisfaction, on or prior to the Closing, of each of the
following conditions precedent; provided, however, that upon consummation of the
Merger, all conditions precedent contained in this Section 7.2 shall be deemed
fully satisfied for purposes of this ARTICLE VII:

            (a) Representations, Warranties and Covenants. Each of the
representations and warranties of Seller contained in this Agreement shall have
been true and correct (without giving effect to any qualification or limitation
as to materiality or Material Adverse Effect set forth therein) in each case as
of the date hereof and (except to the extent that such representations and
warranties speak solely as to another date) as of the Closing Date as though
made on and as of the Closing Date, except where the failure of such
representations and warranties to be true and correct, individually or in the
aggregate, would not reasonably be expected to have a Closing Material Adverse
Effect.

            (b) Performance of Obligations of Seller. Seller (i) shall have
performed or complied with all agreements and covenants required to be performed
by it under this Agreement at or prior to the Closing Date that are qualified as
to materiality or Material Adverse Effect and (ii) shall have performed or
complied in all material respects with all other agreements and covenants
required to be performed by it under this Agreement at or prior to the Closing
Date that are not so qualified.

                                  ARTICLE VIII

                                     CLOSING

            The Closing shall, unless another time and date is agreed to in
writing by the Parties, take place immediately following the Closing (as defined
in the Merger Agreement) under the Merger Agreement and the Closing (as defined
in the Mexican Stock Purchase Agreement) under the Mexican Stock Purchase
Agreement and will be effective immediately following the Effective Time (the
time and date of such Closing being herein called the "Closing Date"). The
Closing will take place at the offices of Chadbourne & Parke LLP, 30 Rockefeller
Plaza, New York, New York 10112, or such other place as the Parties may agree.
On the Closing Date, the Parties hereto shall deliver the following:

            Section 8.1. Deliveries by Seller. (a) At the Closing, Seller shall
deliver to Maquiladora (as Purchaser's designee) the following, which in the
case of documents shall be reasonably satisfactory to Purchaser:


                                       25
<PAGE>
         (i) an Assets Bill of Sale and Assignment and Assumption Agreement,
duly executed by Seller, in form and substance reasonably satisfactory to
Purchaser;

         (ii) the Assets; and

         (iii) all documents of title and instruments of conveyance necessary to
transfer record and beneficial ownership to Purchaser of all Assets which
require execution, endorsement or delivery of such a document under applicable
Law in order to vest record or beneficial ownership thereto in Purchaser.

         Section 8.2. Deliveries by Purchaser. At the Closing, immediately
following the deliveries required to consummate the purchase and sale of the
Purchased Shares, Purchaser shall cause Maquiladora to deliver to Seller the
following documents which shall be reasonably satisfactory to Seller:

                  (i) (A) cash payment of the Purchase Price (via wire transfer
         of immediately available funds, pursuant to Section 2.2), or (B) the
         Assets Promissory Note, duly executed by Maquiladora, in which case,
         Purchaser and/or Maquiladora, as the case may be, shall deliver to
         Seller at Closing such other agreements and documents as shall be
         required by the terms of the Financing Agreement in connection with the
         Assets Promissory Note; and

                  (ii) an Asset Bill of Sale and Assignment and Assumption
         Agreement, duly executed by Maquiladora, in form and substance
         reasonably satisfactory to Seller.

                                   ARTICLE IX

                                INDEMNIFICATION


         Section 9.1. Indemnification by Seller. Subject to the limitations on
and procedures for indemnification set forth in this ARTICLE IX, Seller shall
indemnify, defend and hold harmless Purchaser, its designee and their respective
Representatives and Affiliates and each of the heirs, executors, successors and
assigns of any of the foregoing (the "Purchaser Indemnified Parties") from and
against, and pay or reimburse, as the case may be, the Purchaser Indemnified
Parties for, any Damages, as incurred, suffered by any Purchaser Indemnified
Parties to the extent based upon, arising out of or relating to the following:

                  (i) the breach of any representation or warranty of Seller
         contained in this Agreement;


                                       26
<PAGE>
                  (ii) the breach by Seller of any covenant or agreement of
         Seller contained in this Agreement;

                  (iii) the Excluded Liabilities (including the failure of
         Seller to pay, perform or otherwise discharge any Excluded Liability in
         accordance with its terms); or

                  (iv) the Excluded Assets.

         Section 9.2. Indemnification by Purchaser. Subject to the limitations
on and procedures for indemnification set forth in this ARTICLE IX, Purchaser
shall indemnify, defend and hold harmless Seller and its Representatives and
Affiliates and each of the heirs, executors, successors and assigns of any of
the foregoing (collectively, the "Seller Indemnified Parties") from and against,
and pay or reimburse, as the case may be, the Seller Indemnified Parties for,
any Damages, as incurred, suffered by any Seller Indemnified Parties to the
extent based upon, arising out of or relating to the following:

                  (i) the breach of any representation or warranty of Purchaser
         contained in this Agreement;

                  (ii) the breach by Purchaser of any covenant or agreement of
         Purchaser contained in this Agreement; or

                  (iii) the Assumed Liabilities (including, except as provided
         in Section 12.16, the failure of Purchaser or Purchaser's designee as
         the case may be, to pay, perform or otherwise discharge any Assumed
         Liability in accordance with its terms).

         Section 9.3. Limitations on Indemnification Obligations. (a) The amount
which any Party (an "Indemnifying Party") is or may be required to pay to any
Person (an "Indemnified Party") in respect of Damages or other Liability for
which indemnification is provided under this Agreement shall be reduced by any
amounts actually received (including Insurance Proceeds actually received) by or
on behalf of such Indemnified Party (net of increased insurance premiums and
charges to the extent related to Damages and costs and expenses (including
reasonable legal fees and expenses) incurred by such Indemnified Party in
connection with seeking to collect and collecting such amounts) in respect of
such Damages or other Liability (such net amounts are referred to herein as
"Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity
Reduction Amounts in respect of Damages for which indemnification is provided
under this Agreement after the full amount of such Damages has been paid by an
Indemnifying Party or after an Indemnifying Party has made a partial payment of
such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid
balance of such Damages, then the Indemnified Party shall promptly remit to the
Indemnifying Party an amount equal to the excess (if any) of (A) the amount
theretofore paid by the


                                       27
<PAGE>
Indemnifying Party in respect of such Damages, less (B) the amount of the
indemnity payment that would have been due if such Indemnity Reduction Amounts
in respect thereof had been received before the indemnity payment was made.

         (b) In determining the amount of any indemnity payment under this
Agreement, such amount shall be (i) reduced to take into account any net Tax
benefit realized by the Indemnified Party and its Affiliates arising from the
incurrence or payment by the Indemnified Party or its Affiliates of any amount
in respect of which such payment is made and (ii) increased to take into account
any net Tax cost incurred by the Indemnified Party and its Affiliates as a
result of the receipt or accrual of payments hereunder (grossed-up for such
increase), in each case determined by treating the Indemnified Party and its
Affiliates as recognizing all other items of income, gain, loss, deduction or
credit before recognizing any item arising from the receipt of accrual of any
payment hereunder. In determining the amount of any such Tax benefit or Tax
cost, the Indemnified Party and its Affiliates shall be deemed to be subject to
the applicable Taxes at the maximum statutory rate then in effect. It is the
intention of the Parties to this Agreement that payments made pursuant to this
Agreement are to be treated as relating back to the Closing Date as a purchase
price adjustment, and the Parties shall not take any position inconsistent with
such intention before any Tax authority, except to the extent that a final
determination (as defined in Section 1313 of the Code) with respect to the
recipient party causes any such payment not to be so treated.

         (c) No monetary amount will be payable by Seller to any Purchaser
Indemnified Party with respect to the indemnification of any claims pursuant to
Section 9.1(i) until the aggregate amount of Damages actually incurred by the
Purchaser Indemnified Parties with respect to such claims, together with the
aggregate amount of Damages (as defined in the Mexican Asset Purchase Agreement
solely for purposes of this Agreement) actually incurred by the Purchaser
Indemnified Parties (as defined in the Mexican Asset Purchase Agreement) with
respect to indemnification claims pursuant to Section 9.1(i) of the Mexican
Asset Purchase Agreement, shall exceed on a cumulative basis an amount equal to
one million dollars (U.S.$1,000,000), in which event Seller shall be responsible
only for the amount of such Damages in excess of one million dollars
(U.S.$1,000,000). No monetary amount will be payable by Seller to any Purchaser
Indemnified Party with respect to the indemnification of any claims pursuant to
Section 9.1(i) after the aggregate amount of Damages actually paid by Seller
with respect to such claims, together with the aggregate amount of Damages (as
defined in the Mexican Asset Purchase Agreement) actually paid by Seller with
respect to indemnification claims pursuant to Section 9.1(i) of the Mexican
Asset Purchase Agreement, shall equal on a cumulative basis an amount equal to
ten million dollars (U.S.$10,000,000).

         (d) No monetary amount will be payable by Purchaser to any Seller
Indemnified Party with respect to the indemnification of any claims pursuant to


                                       28
<PAGE>
Section 9.2(i) until the aggregate amount of Damages actually incurred by the
Seller Indemnified Parties with respect to such claims, together with the
aggregate amount of Damages (as defined in the Mexican Asset Purchase Agreement)
actually incurred by the Seller Indemnified Parties (as defined in the Mexican
Asset Purchase Agreement) with respect to indemnification claims pursuant to
Section 9.2(i) of the Mexican Asset Purchase Agreement, shall exceed on a
cumulative basis an amount equal to one million dollars (U.S.$1,000,000), in
which event Purchaser shall be responsible only for the amount of such Damages
in excess of one million dollars (U.S.$1,000,000). No monetary amount will be
payable by Purchaser to any Seller Indemnified Party with respect to the
indemnification of any claims pursuant to Section 9.2(i) after the aggregate
amount of Damages actually paid by Purchaser with respect to such claims,
together with the aggregate amount of Damages (as defined in the Mexican Asset
Purchase Agreement) actually paid by Purchaser with respect to indemnification
claims pursuant to Section 9.2(i) of the Mexican Asset Purchase Agreement, shall
equal on a cumulative basis an amount equal to ten million dollars
(U.S.$10,000,000).

         Section 9.4. Procedures Relating to Indemnification. (a) If a claim or
demand is made against an Indemnified Party, or an Indemnified Party shall
otherwise learn of an assertion, by any Person who is not a party to this
Agreement (or an Affiliate thereof) as to which an Indemnifying Party may be
obligated to provide indemnification pursuant to this Agreement (a "Third Party
Claim"), such Indemnified Party will notify the Indemnifying Party in writing,
and in reasonable detail, of the Third Party Claim reasonably promptly after
becoming aware of such Third Party Claim; provided, however, that failure to
give such notification will not affect the indemnification provided hereunder
except to the extent the Indemnifying Party shall have been actually prejudiced
as a result of such failure. Thereafter, the Indemnified Party will deliver to
the Indemnifying Party, promptly after the Indemnified Party's receipt thereof,
copies of all material notices and documents (including court papers) received
or transmitted by the Indemnified Party's relating to the Third Party Claim.

         (b) If a Third Party Claim is made against an Indemnified Party, the
Indemnifying Party will be entitled to participate in or to assume the defense
thereof (in either case, at the expense of the Indemnifying Party) with counsel
selected by the Indemnifying Party and reasonably satisfactory to the
Indemnified Party. Should the Indemnifying Party so elect to assume the defense
of a Third Party Claim, the Indemnifying Party will not be liable to the
Indemnified Party for any legal or other expenses subsequently incurred by the
Indemnified Party in connection with the defense thereof; provided, however,
that if in the Indemnified Party's reasonable judgment a conflict of interest
exists in respect of such claim or if the Indemnifying Party shall have assumed
responsibility for such claim with any reservations or exceptions, such
Indemnified Party will have the right to employ separate counsel reasonably
satisfactory to the Indemnifying Party to represent such Indemnified Party and
in that event the reasonable fees and expenses of such separate counsel (but not
more than one separate


                                       29
<PAGE>
counsel for all Indemnified Parties similarly situated) shall be paid by such
Indemnifying Party. If the Indemnifying Party assumes the defense of any Third
Party Claim, the Indemnified Party will have the right to participate in the
defense thereof and to employ counsel, at its own expense, separate from the
counsel employed by the Indemnifying Party, it being understood that the
Indemnifying Party will control such defense. The Indemnifying Party will be
liable for the reasonable fees and expenses of counsel employed by the
Indemnified Party for any period during which the Indemnifying Party has failed
to assume the defense thereof. If the Indemnifying Party assumes the defense of
any Third Party Claim, the Indemnifying Party will promptly supply to the
Indemnified Party copies of all material correspondence and documents relating
to or in connection with such Third Party Claim and keep the Indemnified Party
fully informed of all material developments relating to or in connection with
such Third Party Claim (including providing to the Indemnified Party on request
updates and summaries as to the status thereof). If the Indemnifying Party
chooses to defend a Third Party Claim, the Parties will cooperate in the defense
thereof (such cooperation to be at the expense, including reasonable legal fees
and expenses, of the Indemnifying Party), which cooperation shall include the
retention in accordance with this Agreement and (upon the Indemnifying Party's
request) the provision to the Indemnifying Party of records and information
which are reasonably relevant to such Third Party Claim, and making employees
available on a mutually convenient basis to provide additional information and
explanation of any material provided hereunder.

         (c) No Indemnifying Party will consent to any settlement, compromise or
discharge (including the consent to entry of any judgment) of any Third Party
Claim without the Indemnified Party's prior written consent (which consent will
not be unreasonably withheld); provided, however, that if the Indemnifying Party
assumes the defense of any Third Party Claim, the Indemnified Party will agree
to any settlement, compromise or discharge of such Third Party Claim which the
Indemnifying Party may recommend and which by its terms obligates the
Indemnifying Party to pay the full amount of Damages in connection with such
Third Party Claim and unconditionally and irrevocably releases the Indemnified
Party and its Affiliates completely from all Liability in connection with such
Third Party Claim; provided, however, that the Indemnified Party may refuse to
agree to any such settlement, compromise or discharge (x) that provides for
injunctive or other non-monetary relief affecting the Indemnified Party or any
of its Affiliates or (y) that, in the reasonable opinion of the Indemnified
Party, would otherwise materially adversely affect the Indemnified Party or any
of its Affiliates. Whether or not the Indemnifying Party shall have assumed the
defense of a Third Party Claim, the Indemnified Party will not (unless required
by law) admit any liability with respect to, or settle, compromise or discharge,
such Third Party Claim without the Indemnifying Party's prior written consent
(which consent will not be unreasonably withheld).


                                       30
<PAGE>
         (d) Any claim on account of Damages which does not involve a Third
Party Claim will be asserted by reasonably prompt written notice given by the
Indemnified Party to the Indemnifying Party from whom such indemnification is
sought. The failure by any Indemnified Party to so notify the Indemnifying Party
will not relieve the Indemnifying Party from any liability which it may have to
such Indemnified Party under this Agreement, except to the extent that the
Indemnifying Party shall have been actually prejudiced by such failure.

         (e) In the event of payment in full by an Indemnifying Party to any
Indemnified Party in connection with any Third Party Claim, such Indemnifying
Party will be subrogated to and shall stand in the place of such Indemnified
Party as to any events or circumstances in respect of which such Indemnified
Party may have any right or claim relating to such Third Party Claim against any
claimant or plaintiff asserting such Third Party Claim or against any other
Person. Such Indemnified Party will cooperate with such Indemnifying Party in a
reasonable manner, and at the cost and expense of such Indemnifying Party, in
prosecuting any subrogated right or claim.

         Section 9.5. Sole and Exclusive Remedy. The indemnities contained in
this ARTICLE IX and ARTICLE X shall be the sole and exclusive remedies of the
Parties hereto, their Affiliates, successors and assigns with respect to any and
all claims arising out of or relating to this Agreement, the transactions
contemplated hereby, any provision hereof or the breach or performance thereof.

         Section 9.6. Termination of Indemnification Obligations. Except as set
forth in the following sentence, the indemnification obligations of each of
Seller and Purchaser hereunder will survive the Closing, including surviving the
sale or other transfer by any party to this Agreement of any assets or
businesses or the assignment by any party of any Liabilities. The obligations of
each Party to indemnify, defend and hold harmless Indemnified Parties (i)
pursuant to Sections 9.1(i) and 9.2(i), shall terminate when the applicable
representation or warranty expires pursuant to Section 12.4, (ii) pursuant to
Sections 9.1(ii) and 9.2(ii) shall terminate upon the expiration of all
applicable statutes of limitation (giving effect to any extensions thereof,
other than extensions caused by the applicable Indemnified Party) and (iii)
pursuant to Sections 9.1(iii), 9.1(iv) and 9.2(iii) shall continue without time
limitation and shall not terminate at any time; provided, however, that as to
clauses (i) and (ii) above, such obligations to indemnify, defend and hold
harmless shall not terminate with respect to any individual claim as to which
the Indemnified Party shall have, before the expiration of the applicable
period, previously delivered a notice (stating in reasonable detail the basis of
such claim) to the Indemnifying Party.

         Section 9.7. Effect of Investigation. The right to indemnification
pursuant to Sections 9.1(i) and 9.2(i) shall not be affected by any
investigation conducted with


                                       31
<PAGE>
respect to, or any knowledge acquired (or capable of being acquired) at any
time, whether before or after the execution and delivery of this Agreement.

         Section 9.8. Tax Matters. Notwithstanding anything in Sections 9.1,
9.2, 9.4 or 9.5 to the contrary, ARTICLE X will be the exclusive agreement among
the Parties with respect to indemnification, procedures and remedies with
respect to Tax matters.

                                   ARTICLE X

                                   TAX MATTERS


         Section 10.1. Preparation and Filing of Tax Returns. Seller shall
prepare and file or cause to be prepared and filed all Tax Returns (including
amendments thereto) which are required to be filed in respect of the Assets for
any taxable period ending on or before the Closing Date and any taxable period
that includes (but does not end on) the Closing Date (a "Straddle Period").
Purchaser hereby irrevocably designates, and agrees to cause each of its
Affiliates to designate, Seller as its agent to take any and all actions
necessary or incidental to the preparation and filing of such Tax Returns. All
Tax Returns (including amendments thereto) required to be filed in respect of
the Assets for taxable periods beginning after the Closing Date shall be the
responsibility of Purchaser.

         Section 10.2. Consistent with Past Practice. Unless Seller and
Purchaser otherwise agree in writing, all Tax Returns (including amendments
thereto) described in Section 10.1 filed after the Closing Date for taxable
periods ending on or before the Closing Date or Straddle Periods, in the absence
of a controlling change in law or circumstances, shall be prepared on a basis
consistent with the elections, accounting methods, conventions and principles of
taxation used for the most recent taxable periods for which Tax Returns
involving similar matters have been filed. Upon request of Purchaser, Seller
shall make available a draft of such Tax Return (or relevant portions thereof)
for review and comment by Purchaser. Subject to the provisions of this
Agreement, all decisions relating to the preparation of Tax Returns shall be
made in the sole discretion of the party responsible under this Agreement for
such preparation.

         Section 10.3. Payment of Taxes. Except as otherwise provided in this
Agreement, Seller shall pay or cause to be paid, on a timely basis, all Taxes
due with respect to the Assets for taxable periods ending on or before the
Closing Date and the portion of any Straddle Period ending on the Closing Date.
Purchaser shall pay or cause to be paid, on a timely basis, all Taxes due with
respect to the Assets for taxable periods beginning after the Closing Date and
the portion of any Straddle Period beginning on the day after the Closing Date.

         Section 10.4. Allocation of Straddle Period Taxes. In the case of any
Straddle Period:


                                       32
<PAGE>
         (a) Periodic Taxes. (i) The periodic Taxes with respect to the Assets
that are not based on income or receipts (e.g., property Taxes) for the portion
of any Straddle Period which ends on the Closing Date shall be computed based on
the ratio of the number of days in such portion of the Straddle Period and the
number of days in the entire taxable period, and (ii) the periodic Taxes with
respect to the Assets that are not based on income or receipts for the portion
of any Straddle Period beginning on the day after the Closing Date shall be
computed based on the ratio of the number of days in such portion of the
Straddle Period and the number of days in the entire taxable period.

         (b) Non-Periodic Taxes. (i) The Taxes of Purchaser or its business,
assets or activities for that portion of any Straddle Period ending on the
Closing Date (other than Taxes described in Section 10.4(a) above), shall be
computed on a "closing-of-the-books" basis as if such taxable period ended as of
the close of business on the Closing Date, and (ii) the Taxes of Purchaser or
its business, assets or activities for that portion of any Straddle Period
beginning after the Closing Date (other than Taxes described in Section 10.4(a)
above), shall be computed on a "closing-of-the-books" basis as if such taxable
period began on the day after the Closing Date.

         Section 10.5. Tax Refunds and Carrybacks.

         (a) Retention and Payment of Tax Refunds. Except as otherwise provided
in this Agreement, Seller shall be entitled to retain, and to receive within ten
days after Actually Realized by Purchaser and its Affiliates, the portion of all
refunds or credits of Taxes for which Seller is liable pursuant to Section 10.3
or Section 10.6(a), and Purchaser shall be entitled to retain, and to receive
within ten days after Actually Realized by Seller and its Affiliates, the
portion of all refunds or credits of Taxes for which Purchaser is liable
pursuant to Section 10.3 or Section 10.6(b). The amount of any refund or credit
of Taxes to which Seller or Purchaser is entitled to retain or receive pursuant
to the foregoing sentence shall be reduced to take account of any Taxes incurred
by Purchaser and its Affiliates, in the case of a refund or credit to which
Seller is entitled, or Seller and its Affiliates, in the case of a refund or
credit to which Purchaser is entitled, upon the receipt of such refund or
credit.

         (b) Carrybacks. Unless the parties otherwise agree in writing,
Purchaser shall elect where permitted by law, to carry forward any net operating
loss, net capital loss, charitable contribution or other item arising after the
Closing Date that could, in the absence of such election, be carried back to a
taxable period ending on or before the Closing Date. Except as otherwise
provided in this Agreement, notwithstanding the provisions of Section 10.5(a),
(i) any refund or credit of Taxes resulting from the carryback of any item of
Taxes attributable to Purchaser or its Affiliates arising in a taxable period
beginning after the Closing Date to a taxable period ending on or before the
Closing Date or that portion of any Straddle Period that ends on the Closing
Date shall be for the account and benefit of Purchaser and its Affiliates, and
(ii) any refund or


                                       33
<PAGE>
credit of Taxes resulting from the carryback of any item of Taxes attributable
to Seller or its Affiliates arising in a taxable period beginning after the
Closing Date to a taxable period ending on or before the Closing Date or that
portion of any Straddle Period that ends on the Closing Date shall be for the
account and benefit of Seller and its Affiliates.

         (c) Refund Claims. Seller shall be permitted to file at Seller's sole
expense, and Purchaser shall reasonably cooperate with Seller in connection
with, any claims for refund of Taxes to which Seller is entitled pursuant to
this Section 10.5 or any other provision of this Agreement. Seller shall
reimburse Purchaser for any reasonable out-of-pocket costs and expenses incurred
by Purchaser and its Representatives or Affiliates in connection with such
cooperation. Purchaser shall be permitted to file at Purchaser's sole expense,
and Seller shall reasonably cooperate with Purchaser in connection with, any
claims for refunds of Taxes to which Purchaser is entitled pursuant to this
Section 10.5 or any other provision of this Agreement. Purchaser shall reimburse
Seller for any reasonable out-of-pocket costs and expenses incurred by Seller
and its Representatives and Affiliates in connection with such cooperation.

         Section 10.6. Tax Indemnification.

         (a) Seller Indemnification. Seller shall be liable for, and shall
indemnify, defend and hold harmless the Purchaser Indemnified Parties from and
against:

                  (i) all Taxes due with respect to the Assets for taxable
         periods ending on or before the Closing Date and the portion of any
         Straddle Period ending on the Closing Date;

                  (ii) all Taxes for any Tax period (whether beginning before,
         on or after the Closing Date) attributable to the breach by Seller or
         its Affiliates of any representation, warranty, covenant or obligation
         under this Agreement;

                  (iii) all liability for a breach by Seller of any
         representation, warranty, covenant, or obligation under this Agreement
         with respect to Tax matters; and

                  (iv) all liability for any reasonable legal, accounting,
         appraisal, consulting or similar fees and expenses relating to the
         foregoing.

         Notwithstanding the foregoing, Seller shall not indemnify, defend or
hold harmless the Purchaser Indemnified Parties from any liability for Taxes
attributable to a Purchaser Tax Act. A Purchaser Tax Act shall mean any action
specified in Schedule 10.6(a) attached hereto. Seller's obligations under this
Section 10.6(a) shall not be subject to the limitations in Section 9.3 of this
Agreement.

         (b) Purchaser Indemnification. Purchaser shall be liable for, and shall
indemnify, defend and hold harmless the Seller Indemnified Parties from and
against:


                                       34
<PAGE>
                  (i) all Taxes due with respect to the Assets (other than Taxes
         for which Seller is obligated to provide indemnification pursuant to
         Section 10.6(a)(i));

                  (ii) all Taxes for any Tax period (whether beginning before,
         on or after the Closing Date) attributable to the breach by Purchaser
         or its Affiliates of any representation, warranty, covenant or
         obligation under this Agreement;

                  (iii) all liability for a breach by Purchaser of any
         representation, warranty, covenant, or obligation under this Agreement
         with respect to Tax matters;

                  (iv) all Taxes attributable to a Purchaser Tax Act; and

                  (v) all liability for any reasonable legal, accounting,
         appraisal, consulting or similar fees and expenses relating to the
         foregoing.

         Purchaser's obligation under this Section 10.6(b) shall not be subject
to the limitations in Section 9.3 of this Agreement.

         Section 10.7. Notice of Indemnity. Whenever an Indemnified Party
becomes aware of the existence of an issue raised by any Tax authority which
could reasonably be expected to result in a determination that would increase
the liability for any Tax of the other Party hereto or any of its
Representatives or Affiliates for any Tax period or require a payment hereunder
by the other party (hereinafter an "Indemnity Issue"), the Indemnified Party
shall in good faith promptly give notice to an Indemnifying Party of such
Indemnity Issue. The failure of the Indemnified Party to give such notice shall
not relieve the Indemnifying Party of its obligations under this Agreement,
except to the extent such Indemnifying Party or any of its Representatives or
Affiliates is actually prejudiced by such failure to give notice.

         Section 10.8. Payments.

         (a) Timing Adjustments. In the event that a final determination (which
shall include the execution of a Form 870-AD or successor form) results in a
timing difference (e.g., an acceleration of income or delay of deductions) that
would increase Seller's liability for Taxes pursuant to ARTICLE IX or this
ARTICLE X or results in a timing difference (e.g., an acceleration of deductions
or delay of income) that would increase Purchaser's liability for Taxes pursuant
to ARTICLE IX or this ARTICLE X, Purchaser or Seller, as the case may be, will
promptly make payments to Seller or Purchaser as and when Purchaser or Seller
(or its Affiliates), as the case may be, actually realizes any Tax benefits as a
result of such timing difference (or under such other method for determining the
present value of any such anticipated Tax benefits as agreed to by the Parties).



                                       35

<PAGE>

            (b) Time for Payment. Any indemnity payment required to be made
pursuant to this Agreement shall be paid within thirty days after the
Indemnified Party makes written demand upon the Indemnifying Party, provided
that in no event shall such payment be required to be made earlier than five
business days prior to the date on which the relevant Taxes (including estimated
Taxes) are required to be paid (or would be required to be paid if no such Taxes
are due) to the relevant Tax authority.

            Section 10.9. Tax Contests. The Indemnifying Party and its
Representatives, at the Indemnifying Party's expense, shall be entitled to
participate (a) in all conferences, meetings and proceedings with any Tax
authority, the subject matter of which is or includes an Indemnity Issue and (b)
in all appearances before any court, the subject matter of which is or includes
an Indemnity Issue. The Party who has responsibility for filing the Tax Return
under this Agreement with respect to which there could be an increase in
liability for any Tax or with respect to which a payment could be required
hereunder shall have the right to decide as between the Parties hereto how such
matter is to be dealt with and finally resolved with the appropriate Tax
Authority and shall control all audits and similar proceedings, provided,
however, that if such contest would be reasonably expected to result in a
material increase in the tax liability related to the Assets, for which
Purchaser would be liable, Purchaser may participate in the conduct of such
contest and Seller shall not settle any such contest without the consent of
Purchaser, which consent shall not be unreasonably withheld. If no Tax Return is
or was required to be filed in respect of an Indemnity Issue, the Indemnifying
Party shall be treated as the responsible party with respect thereto. The
responsible party agrees to cooperate in the settlement of any Indemnity Issue
with the other Party and to take such other Party's interests into account.

            Section 10.10. Cooperation and Exchange of Information. Each Party
hereto agrees to provide, and to cause each of its Affiliates to provide, such
cooperation and information as such other Party shall request, on a timely
basis, in connection with the preparation or filing of any Tax Return or claim
for Tax refund not inconsistent with this Agreement or in conducting any Tax
audit, Tax dispute, or otherwise in respect of Taxes or to carry out the
provisions of this Agreement, provided, however, that neither Party shall be
obligated to provide the other Party with Tax Returns, documentation or other
information of a proprietary or confidential nature for purposes of verifying
any calculation, and provided further, that in any such case where one Party
does not provide the other Party with Tax Returns, documentation or information
because it is proprietary or confidential, both Parties shall cooperate in
developing mutually acceptable procedures including retaining a mutually
agreeable accounting firm to review such Tax Returns, documentation or
information for purposes of verifying such calculation.

            Section 10.11. Mexican Income Taxes; Customs Duties; Advanced
Pricing Agreement; Transfer, Sales and Use Taxes.


                                       36
<PAGE>
            (a) Mexican Income Taxes. Seller and Purchaser shall fully comply
with all Mexican Tax laws and with the Convention between the United States of
America and the United Mexican States for Avoidance of Double Taxation and
Prevention of Fiscal Evasion with respect to Taxes on Income in connection with
the sale of the Assets such that Purchaser shall not be required to, and
Purchaser shall not, deduct or withhold any amount from the Purchase Price.
Seller agrees to indemnify and hold Purchaser harmless from and against any
Taxes imposed on any gain from the sale of the Assets by Seller under this
Agreement due to any Governmental Authority, including any obligation Purchaser
may have to withhold or remit to Mexican Governmental Authorities Taxes levied
on Seller as a result of any gain from the sale of the Assets under this
Agreement.

            (b) Advanced Pricing Agreement. Seller, at its own expense, shall
have the sole and exclusive right, power and authority to negotiate with the
appropriate Mexican Governmental Authorities and enter into the Advanced Pricing
Agreement on or prior to the Closing. Seller shall keep Purchaser informed of
the status of such negotiations and shall not enter into the Advanced Pricing
Agreement without the written consent of Purchaser, which consent shall not be
unreasonably withheld. Purchaser, Maquiladora, and Seller shall cooperate with
each other in negotiating and finalizing the Advanced Pricing Agreement after
the Closing. Purchaser shall, and shall cause Maquiladora, not to amend,
supplement or modify the Advanced Pricing Agreement as it would relate to
periods prior to the Closing without the written consent of Seller, which
consent shall not be unreasonably withheld.

            (c) Mexican Customs Duties. Purchaser will cause Maquiladora at its
own expense after the Closing to timely prepare and execute any and all customs
documents required to reflect the change of ownership of the Assets in Mexico
and to timely file a virtual exportation and virtual importation pediment to
reconcile the open pediments of Maquiladora as required by Mexican law. Seller
shall reasonably cooperate with Purchaser and/or Maquiladora in preparing the
Mexican customs duties-related filings. Seller shall be responsible for any
customs duties or fees relating to periods prior to the Closing. Purchaser and
Maquiladora will be responsible for any customs duties or fees relating to
periods from and after the Closing. Purchaser and Seller share equally customs
duties or fees, if any, incurred in connection with the transactions
contemplated by this Agreement.

            (d) Transfer, Sales, Use and Value Added Taxes. Pursuant to rule
2.4.5 of the Miscellaneous Resolution 2002 (Resolucion Miscelanea Fiscal para
2002) and in order to expedite the refund of the Mexican Value Added Tax
accruing under any invoice issued by Seller to Purchaser in connection with the
sale of the Assets hereunder, Seller and Purchaser hereby agree to ratify, no
later than 15 (fifteen) calendar days following the Closing Date, a Spanish
version of this Agreement before a Mexican Notary Public in the city of
Mexicali, State of Baja California, and to attach to such


                                       37
<PAGE>
ratification such invoice (or invoices) issued by Seller. Such invoice or
invoices shall include, inter alia, a full description of the Assets, their
unitary price, and the applicable Value Added Tax, as well as a stamp with the
legend "Impuesto retenido de conformidad con la Ley del Impuesto al Valor
Agregado" (Tax withheld pursuant to the Value Added Tax Law). The parties shall
further execute such other instruments and documents and take all actions as
shall be appropriate or required under Mexican law to obtain the refund of the
Value Added Tax referred to herein.

            Notwithstanding anything to the contrary in this Agreement, all
transfer, documentary, sales, use, stamp, registration, value added and other
similar Taxes and fees (including any penalties and interest) incurred in
connection with the transactions contemplated by this Agreement shall be shared
equally by Seller and Purchaser. Each Party hereto agrees to file all necessary
documentation (including all Tax Returns) with respect to such Taxes in a timely
manner.

            Purchaser shall have the sole and exclusive right, power and
authority to file, or cause Maquiladora to file, all necessary documentation
(including all Tax Returns in Mexico) with respect to any value added Tax
accrued in Mexico, in connection with the sale of Assets hereunder. Should the
sale of the Assets hereunder generate any value added tax credit balance in
favor of Purchaser or Maquiladora in Mexico, Purchaser shall immediately timely
make, or cause Maquiladora to timely make, all filings required to obtain a
refund (devolucion) thereof in terms of the Mexican Value Added Tax Law (Ley del
Impuesto al Valor Agregado) and any other applicable laws, regulations, rules,
decrees or tax miscellaneous. All costs and expenses incurred in connection with
the refund efforts (including any costs incurred with respect to the
registration for the ALTEX program) shall be shared equally by Seller and
Purchaser. Likewise, the amount of the refund will also be shared equally
between Seller and Purchaser. Purchaser shall be obligated to deliver to Seller
its share of such refund amount within three (3) Business Days from the date
Purchaser receives it. Purchaser shall provide Seller with a reasonable
opportunity to review drafts of all value added Tax-related filings in advance
and Purchaser shall take Seller's comments and suggestions into consideration.
To the extent value added Tax is due prior to repayment of any Obligation,
Purchaser shall notify Seller not less than three (3) Business Days before such
value added Tax is due, and Seller shall remit its share of such value added Tax
either to Purchaser, Maquiladora or the relevant Taxing Authority on or before
the applicable payment date. Notwithstanding anything to the contrary in this
Agreement or the Financing Agreement, Purchaser and Maquiladora shall be
entitled to withhold from repayment of the Obligations an amount equal to 50% of
any transfer, documentary, sales, use, stamp, registration, value added and
other similar taxes and fees (including penalties and interest) that are paid by
Purchaser or Maquiladora after the Closing in connection with the transactions
contemplated by this Agreement, and will promptly provide to Seller notice of
the amounts so paid and withheld; provided, however, Purchaser and Maquiladora
shall only be entitled to make such withholding to the extent Seller has not
paid or remitted to


                                       38
<PAGE>
Purchaser, Maquiladora or the relevant Taxing Authority Seller's share of such
transfer, documentary, sales, use, stamp, registration, value added or similar
tax pursuant to this Section 10.11(d). To the extent amounts are so withheld,
such withheld amounts shall be treated for all purposes of the Financing
Documents as having been paid to Seller, and shall be treated for all purposes
of this Section 10.11(d) as having been paid by Seller. Purchaser or
Maquiladora, as the case may be, shall remit to Seller within three (3) Business
Days of receipt, Seller's share of any refunds to be paid to it of any transfer,
documentary, sales, use, stamp, registration, value added and other similar
taxes and fees (including penalties and interest) in respect of which amounts
were withheld pursuant hereto.

            Section 10.12. Tax Records.

            (a) The Parties agree to (and to cause each of their Affiliates to)
(i) retain all Tax Returns, related schedules and work papers, and all material
records and other documents as required under Section 6001 of the Code and the
regulations promulgated thereunder relating thereto existing on the date hereof
or created through the Closing Date, for a period of at least ten years
following the Closing Date and (ii) allow the Party to this Agreement, at times
and dates reasonably acceptable to the retaining Party, to inspect, review and
make copies of such records, as the Parties may reasonably deem necessary or
appropriate from time to time. In addition, after the expiration of such
ten-year period, such Tax Returns, related schedules and workpapers, and
material records shall not be destroyed or otherwise disposed of at any time,
unless, prior to such destruction or disposal, (A) the Party proposing to
destroy or otherwise dispose of such records shall provide no less than 30 days'
prior written notice to the other Party, specifying in reasonable detail the
records proposed to be destroyed or disposed of and (B) if a recipient of such
notice shall request in writing prior to the scheduled date for such destruction
or disposal that any of the records proposed to be destroyed or disposed of be
delivered to such requesting Party, the Party proposing the destruction or
disposal shall promptly arrange for the delivery of such requested records at
the expense of the Party requesting such records.

            (b) Notwithstanding anything in this Agreement to the contrary, if
any Party fails to comply with the requirements of Section 10.12(a) hereof, the
Party failing so to comply shall be liable for, and shall hold the other Party,
harmless from, any Taxes (including without limitation, penalties for failure to
comply with the record retention requirements of the Code) and other costs
resulting from such Party's failure to comply.

            Section 10.13. Dispute Resolution. Any dispute, claim or controversy
arising out of or relating to any provision of ARTICLE X of this Agreement will
be resolved in accordance with the procedures set forth in Section 12.3(b) of
this Agreement, provided that each such mediator or arbitrator selected pursuant
to such procedures shall have an expertise in Tax matters.


                                       39
<PAGE>
                                   ARTICLE XI

                                   TERMINATION

            Section 11.1. Voluntary Termination. This Agreement may be
terminated and the transactions contemplated hereby may be abandoned at any time
prior to the Closing Date by the mutual written consent of Purchaser and Seller.

            Section 11.2. Automatic Termination. In the event of a termination
of the Merger Agreement, this Agreement shall automatically and immediately
terminate.

            Section 11.3. Effect of Termination. In the event of the termination
of this Agreement, all further obligations of the Parties hereunder shall
terminate, and the transactions contemplated hereby shall be abandoned without
further action or liability by any of the Parties hereto, except that (i)
Section 11.3 ("Effect of Termination"), Section 12.2 ("Notices"), Section 12.3
("Choice of Law, Dispute Resolution"), Section 12.6 ("Entire Agreement;
Waivers"), Section 12.8 ("Severability"), Section 12.10 ("Expenses") and Section
12.12 ("Parties in Interest") shall survive such termination and (ii) nothing
shall relieve any Party hereto from liability for any breach of this Agreement
prior to such termination.

                                  ARTICLE XII

                                  MISCELLANEOUS

            Section 12.1. Assignment. No Party to this Agreement will convey,
assign or otherwise transfer any of its rights or obligations under this
Agreement without the prior written consent of the other Party in its sole and
absolute discretion. Notwithstanding the foregoing, any Party may (without
obtaining any consent) assign, delegate or sublicense all or any portion of its
rights and obligations hereunder to (i) the surviving entity resulting from a
merger or consolidation involving such Party, (ii) the acquiring entity in a
sale or other disposition of (A) all or substantially all of the assets of such
Party as a whole, (B) any line of business or division of such Party, or (C), in
the case of Purchaser, the Facility, (iii) any other Person that is created as a
result of a spin-off from, or similar reorganization transaction of, such Party
or any line of business or division of such Party or (iv) an Affiliate. In the
event of an assignment pursuant to (ii) or (iii) above, the non-assigning Party
shall, at the assigning Party's request, use good faith commercially reasonable
efforts to enter into separate agreements with each of the resulting entities
and take such further actions as may be reasonably required to assure that the
rights and obligations under this Agreement are preserved, in the aggregate, and
divided equitably between such resulting entities. Any conveyance, assignment or
transfer requiring the prior written consent of another Party pursuant to this
Section 12.1


                                       40
<PAGE>
which is made without such consent will be void ab initio. No assignment of this
Agreement will relieve the assigning Party of its obligations hereunder.

            Section 12.2. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed duly given (a) on the date of
delivery if delivered personally, (b) upon confirmation of receipt if delivered
by telecopy or telefacsimile, (c) on the first Business Day following the date
of dispatch if delivered by a recognized next-day courier service, or (d) on the
fifth Business Day following the date of mailing if delivered by registered or
certified mail, return receipt requested, postage prepaid. All notices hereunder
shall be delivered as set forth below, or pursuant to such other instructions as
may be designated in writing by the Party to receive such notice:

            If to Purchaser, to:

                     Alpha Industries, Inc.
                     20 Sylvan Road
                     Woburn, MA  01801
                     Fax:       (617) 824-4426
                     Attention: Paul E. Vincent
                                Chief Financial Officer

                     With copies to (not effective for purposes of notice):

                     Alpha Industries, Inc.
                     20 Sylvan Road
                     Woburn, MA  01801
                     Fax:       (617) 824-4564
                     Attention: James K. Jacobs, Esq.
                                General Counsel

            or if to Seller, to:

                     Conexant Systems, Inc.
                     4311 Jamboree Road
                     Newport Beach, California  92660-3095
                     Fax:       (949) 483-6388
                     Attention: Dennis E. O'Reilly
                                Senior Vice President, General
                                Counsel and Secretary


                                       41
<PAGE>
                     With a copy to (not effective for purposes of notice):

                     Chadbourne & Parke LLP
                     30 Rockefeller Plaza
                     New York, New York 10112
                     Fax:       (212) 541-5369
                     Attention: Peter R. Kolyer, Esq.


            Section 12.3. Choice of Law; Dispute Resolution.

            (a) Choice of Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware (without giving effect to
choice of law principles).

            (b) Dispute Resolution. In the event that from and after the
Closing, any dispute, claim or controversy (collectively, a "Dispute") arises
out of or relates to any provision of this Agreement or the breach, performance,
enforcement or validity or invalidity thereof, the designees of Seller's Chief
Executive Officer and Purchaser's Chief Executive Officer will attempt a good
faith resolution of the Dispute within thirty (30) days after either Party
notifies the other Party in writing of the Dispute. If the Dispute is not
resolved within thirty (30) days of the receipt of the notification, or within
such other time as they may agree, the Dispute will be referred for resolution
to Seller's Chief Executive Officer and Purchaser's Chief Executive Officer.
Should they be unable to resolve the Dispute within thirty (30) days following
the referral to them, or within such other time as they may agree, Seller and
Purchaser will then attempt in good faith to resolve such Dispute by mediation
in accordance with the then-existing CPR Mediation Procedures promulgated by the
CPR Institute for Dispute Resolution, New York City. If such mediation is
unsuccessful within thirty (30) days (or such other period as the Parties may
mutually agree) after the commencement thereof, such Dispute shall be submitted
by the Parties to binding arbitration, initiated and conducted in accordance
with the then-existing American Arbitration Association Commercial Arbitration
Rules, before a single arbitrator selected jointly by Seller and Purchaser, who
shall not be the same person as the mediator appointed pursuant to the preceding
sentence. If Seller and Purchaser cannot agree upon the identity of an
arbitrator within ten (10) days after the arbitration process is initiated, then
the arbitration will be conducted before three arbitrators, one selected by
Seller, one selected by Purchaser and the third selected by the first two. The
arbitration shall be conducted in San Francisco, California and shall be
governed by the United States Arbitration Act, 9 U.S.C. Sections 1-16, and
judgment upon the award may be entered by any court having jurisdiction thereof.
The arbitrators shall have case management authority and shall resolve the
Dispute in a final award within one hundred eighty (180) days from the
commencement of the arbitration action, subject to any extension of time thereof
allowed by the arbitrators upon good cause shown.


                                       42
<PAGE>
            Section 12.4. Survival of Representations and Warranties and
Covenants. The respective representations and warranties of the Parties
contained in this Agreement (other than those set forth in the following
sentence) will survive the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby and the Closing and will
continue in full force and effect until six (6) months after the Closing Date
and will then expire. The representations and warranties of the Parties
contained in Section 3.1, Section 3.2, Section 3.3, Section 3.8, Section 3.11,
Section 4.1, Section 4.2, and Section 4.3 will survive the execution and
delivery of this Agreement, the consummation of the transactions contemplated
hereby and the Closing and will continue in full force and effect until all
applicable statutes of limitation (including any extensions thereof) have
expired and will then expire. All covenants of the Parties contained in this
Agreement will remain in full force and effect after, and survive, the Closing
(other than those to be performed at or prior to the Closing).

            Section 12.5. Limitations on Representations and Warranties. Except
for the representations and warranties set forth in this Agreement, the Assets
are being sold "AS IS, WHERE IS, AND WITH ALL FAULTS." EXCEPT FOR THE
REPRESENTATIONS AND WARRANTIES SET FORTH IN THIS AGREEMENT, SELLER MAKES NO
REPRESENTATIONS OR WARRANTIES WHATSOEVER CONCERNING THE ASSUMED LIABILITIES, THE
ASSETS, THE FACILITY, THE BUSINESS OR OPERATIONS OF MAQUILADORA OR ANY OTHER
MATTER, EXPRESS OR IMPLIED, ORAL, OR WRITTEN. SELLER HEREBY SPECIFICALLY
DISCLAIMS THE IMPLIED WARRANTY OF MERCHANTABILITY AND THE IMPLIED WARRANTY OF
FITNESS FOR A PARTICULAR PURPOSE.

            Section 12.6. Entire Agreement; Waivers. This Agreement, together
with all exhibits and Schedules hereto, and the other agreements and instruments
of the Parties delivered in connection herewith constitute the entire agreement
and supersede all prior agreements and understandings both written and oral,
among the Parties with respect to the subject matter hereof. The failure of any
Party to this Agreement to assert any of its rights under this Agreement or
otherwise shall not constitute a waiver of those rights.

            Section 12.7. Counterparts. This Agreement may be executed in
separate counterparts, each such counterpart being deemed to be an original
instrument, and all such counterparts will together constitute the same
agreement. This Agreement may be executed and delivered by telecopier with the
same force and effect as if it were a manually executed and delivered
counterpart.

            Section 12.8. Severability. If any provision of this Agreement or
the application thereof to any Person or circumstance is determined by a court
of competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances other than those as to which it has been held invalid or
unenforceable, will remain in full force and effect and will in no


                                       43
<PAGE>
way be affected, impaired or invalidated thereby. If the economic or legal
substance of the transactions contemplated hereby is affected in any manner
adverse to any Party as a result thereof, the Parties will negotiate in good
faith in an effort to agree upon a suitable and equitable substitute provision
to effect the original intent of the Parties.

            Section 12.9. Headings. The headings of the Articles and Sections
herein are inserted for convenience of reference only and are not intended to be
a part of or to affect the meaning or interpretation of this Agreement.

            Section 12.10. Expenses. Except as otherwise provided in this
Agreement, each of the Parties shall be liable for its own expenses incurred in
connection with the negotiation, preparation, execution and performance of this
Agreement prior to Closing.

            Section 12.11. Amendments. This Agreement cannot be amended,
modified or supplemented except by a written agreement executed by Seller and
Purchaser.

            Section 12.12. Parties in Interest. This Agreement is binding upon
and is for the benefit of the Parties hereto and their respective successors and
permitted assigns. This Agreement is not made for the benefit of any Person not
a Party hereto, and no Person other than the Parties hereto or their respective
successors and permitted assigns will acquire or have any benefit, right, remedy
or claim under or by reason of this Agreement, except that the provisions of
Sections 9.1, 9.2 and 10.6 hereof shall inure to the benefit of the Persons
referred to therein.

            Section 12.13. Schedules and Exhibits. Inclusion of an item or
matter on any of the Schedules or Exhibits attached hereto shall not be deemed
to be an admission by any Party that such item or matter is required to be
disclosed in such Schedule or Exhibit. Each disclosure on each Schedule, to the
extent specified therein, qualifies the correspondingly numbered representation
and warranty or covenant contained herein and, to the extent it is apparent on
the face of such disclosure that such disclosure qualifies another
representation or warranty contained herein, such other representation and
warranty.

            Section 12.14. Compliance with Bulk Sales Laws. The Parties hereby
waive compliance with the bulk sales laws and any other similar laws in any
applicable jurisdiction in respect of the transactions contemplated by this
Agreement.

            Section 12.15. Savings Clause. Anything contained herein to the
contrary notwithstanding, this Agreement shall not constitute an agreement to
assign any Assumed Contract if an assignment or attempted assignment of the same
without the Consent of any other party or parties thereto or other required
Consent would constitute a breach thereof or of any applicable law or in any way
impair the rights of Seller, Purchaser or


                                       44
<PAGE>
Purchaser's designee thereunder. If any such Consent is not obtained or if an
attempted assignment would be ineffective or would impair any rights of either
Seller, Purchaser or Purchaser's designee under any such Assumed Contract that
Purchaser's designee would not receive all such rights, then (x) Seller will use
commercially reasonable efforts (it being understood that such efforts shall not
include any requirement of Seller to pay any consideration or offer or grant any
financial accommodation) to provide or cause to be provided to Purchaser's
designee the benefits of any such Assumed Contract and Seller will promptly pay
or cause to be paid to Purchaser's designee when received all moneys and
properties received by Seller with respect to any such Assumed Contract and (y)
to the extent that Purchaser's designee receives the benefits of such Assumed
Contract, Purchaser will cause its designee to pay, perform and discharge on
behalf of Seller all of Seller's Liabilities thereunder in a timely manner and
in accordance with the terms thereof. If and when such Consents are obtained,
the transfer of the applicable Assumed Contract shall be effected as promptly
following the Closing as shall be practicable in accordance with the terms of
this Agreement.

            Section 12.16. Cooperation Following the Closing. Following the
Closing, the Parties shall each deliver to the other such further information
and documents and shall execute and deliver to the other such further
instruments and agreements as the other shall reasonably request to consummate
or confirm the transactions provided for in this Agreement, to accomplish the
purpose of this Agreement or to assure to the other the benefits of this
Agreement.

[The remainder of this page is left intentionally blank; signature page follows]


                                       45
<PAGE>
            IN WITNESS WHEREOF, each of the Parties listed below has executed
this Amended and Restated Mexican Asset Purchase Agreement as of the day and
year first above written.

                                        CONEXANT SYSTEMS, INC.


                                        By: /s/ Dennis E. O'Reilly
                                            ------------------------------------
                                            Name:  Dennis E. O'Reilly
                                            Title: Senior Vice President,
                                                   General Counsel and Secretary


                                        ALPHA INDUSTRIES, INC.


                                        By: /s/ Paul E. Vincent
                                            ------------------------------------
                                            Name:  Paul E. Vincent
                                            Title: Vice President, Chief
                                                   Financial Officer, Treasurer
                                                   and Secretary




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-2.5
<SEQUENCE>6
<FILENAME>b43517ssexv2w5.txt
<DESCRIPTION>U.S. ASSET PURCHASE AGREEMENT
<TEXT>
<PAGE>

                                                                     Exhibit 2.5


================================================================================


                          U.S. ASSET PURCHASE AGREEMENT

                          DATED AS OF DECEMBER 16, 2001

                                 BY AND BETWEEN

                             CONEXANT SYSTEMS, INC.,

                                       AND

                             ALPHA INDUSTRIES, INC.


================================================================================



<PAGE>

                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                                                 Page No.
                                                                                                 --------

<S>                                                                                               <C>
ARTICLE I          DEFINITIONS.....................................................................1


ARTICLE II         SALE AND PURCHASE OF ASSETS.....................................................8

     Section 2.1.  Purchase and Sale of Assets.....................................................8
     Section 2.2.  Purchase Price..................................................................8
     Section 2.3.  No Assumption of Liabilities....................................................9
     Section 2.4.  Allocation of Purchase Price....................................................9

ARTICLE III        SELLER'S REPRESENTATIONS AND WARRANTIES.........................................9

     Section 3.1.  Corporate Status, Good Standing and Authorization...............................9
     Section 3.2.  Authority; Enforceability.......................................................9
     Section 3.3.  Consents; No Conflicts or Violations...........................................10
     Section 3.4.  Compliance with Laws...........................................................10
     Section 3.5.  Intellectual Property..........................................................10
     Section 3.6.  Litigation.....................................................................11
     Section 3.7.  Employee Matters...............................................................11
     Section 3.8.  Labor Relations................................................................11
     Section 3.9.  Tax Matters....................................................................11
     Section 3.10. No Brokers.....................................................................12
     Section 3.11. Title to Properties............................................................12
     Section 3.12. Insurance......................................................................12

ARTICLE IV         PURCHASER'S REPRESENTATIONS AND WARRANTIES.....................................12

     Section 4.1.  Organization of Purchaser......................................................12
     Section 4.2.  Authority; Enforceability......................................................12
     Section 4.3.  Consents; No Conflicts or Violations...........................................13
     Section 4.4.  Litigation.....................................................................13
     Section 4.5.  No Brokers.....................................................................14

ARTICLE V          COVENANTS......................................................................14

     Section 5.1.  Access.........................................................................14
     Section 5.2.  Reasonable Best Efforts........................................................15
     Section 5.3.  Conduct of Business by Seller..................................................17
     Section 5.4.  Employment Arrangements........................................................18
     Section 5.5.  Public Announcements...........................................................18
     Section 5.6.  Supplements to Schedules.......................................................19
</TABLE>


                                       i

<PAGE>

<TABLE>
<CAPTION>
                                                                                                   Page No.
                                                                                                   --------

<S>                                                                                                    <C>
     Section 5.7.        Insurance......................................................................19
     Section 5.8.        License of Purchaser Intellectual Property to Seller...........................21

ARTICLE VI               CONDITIONS TO SELLER'S AND PURCHASER'S OBLIGATIONS.............................22


ARTICLE VII              CLOSING........................................................................22

     Section 7.1.        Deliveries by Seller...........................................................22
     Section 7.2.        Deliveries by Purchaser........................................................23

ARTICLE VIII             INDEMNIFICATION................................................................23

     Section 8.1.        Indemnification by Seller......................................................23
     Section 8.2.        Indemnification by Purchaser...................................................24
     Section 8.3.        Limitations on Indemnification Obligations.....................................24
     Section 8.4.        Procedures Relating to Indemnification.........................................25
     Section 8.5.        Sole and Exclusive Remedy......................................................27
     Section 8.6.        Termination of Indemnification Obligations.....................................28
     Section 8.7.        Effect of Investigation........................................................28

ARTICLE IX               TAXES..........................................................................28

     Section 9.1.        Transfer, Sales and Use Taxes..................................................28
     Section 9.2.        Tax Returns....................................................................28
     Section 9.3.        Prorations.....................................................................29
     Section 9.4.        Allocation of Straddle Period Taxes............................................29

ARTICLE X                TERMINATION....................................................................29

     Section 10.1.       Voluntary Termination..........................................................29
     Section 10.2.       Automatic Termination..........................................................30
     Section 10.3.       Effect of Termination..........................................................30

ARTICLE XI               MISCELLANEOUS..................................................................30

     Section 11.1.       Assignment.....................................................................30
     Section 11.2.       Notices........................................................................30
     Section 11.3.       Choice of Law; Dispute Resolution..............................................32
     Section 11.4.       Survival of Representations and Warranties and Covenants.......................32
     Section 11.5.       Limitations on Representations and Warranties..................................33
     Section 11.6.       Entire Agreement; Waivers......................................................33
     Section 11.7.       Counterparts...................................................................33
     Section 11.8.       Severability...................................................................33
     Section 11.9.       Headings.......................................................................34
     Section 11.10.      Expenses.......................................................................34
</TABLE>

                                       ii
<PAGE>

<TABLE>
<CAPTION>
                                                                                                    Page No.
                                                                                                    --------
<S>                                                                                                    <C>
     Section 11.11.      Amendments.....................................................................34
     Section 11.12.      Parties in Interest............................................................34
     Section 11.13.      Schedules and Exhibits.........................................................34
     Section 11.14.      Cooperation Following the Closing..............................................34
</TABLE>

                                      iii


<PAGE>

                          U.S. ASSET PURCHASE AGREEMENT

      U.S. ASSET PURCHASE AGREEMENT (this "Agreement"), dated as of December 16,
2001, by and between Conexant Systems, Inc., a Delaware corporation ("Seller"),
and Alpha Industries, Inc., a Delaware corporation ("Purchaser"). Seller and
Purchaser are sometimes hereinafter collectively referred to as the "Parties"
and individually as a "Party."

                                    RECITALS

      A. Seller employs certain employees (the "Package Design Team") at its
facilities in Newport Beach, California, who perform certain design and other
functions in support of certain manufacturing and assembly operations conducted
by Seller and its Affiliates (as defined herein) in Mexicali, Baja California,
Mexico;

      B. Seller owns certain assets (including certain intellectual property) in
the United States utilized by the Package Design Team, which it desires to sell
to Purchaser; and

      C. Purchaser desires to purchase the Assets (as defined herein) and employ
the Package Design Team Employees (as defined herein) pursuant to the terms set
forth in this Agreement.

                                    AGREEMENT

      NOW, THEREFORE, in consideration of the representations, warranties,
mutual covenants and promises contained herein and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Parties hereby agree as follows:

                                   ARTICLE I

                                   DEFINITIONS

      As used in this Agreement, the following terms shall have the meanings
given those terms in this ARTICLE I or in the Section of this Agreement
referenced in the definition provided for such term:

<PAGE>


      "Affiliate" of a Person means any other Person that, directly or
indirectly, controls, is controlled by, or is under common control with, such
Person. The term "control" (including, with correlative meaning, the terms
"controlled by" and "under common control with"), as used with respect to any
Person, means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise.

      "Agreement" is defined in the first paragraph hereof.

      "Assets" means all of Seller's right, title and interest in and to (i) the
equipment specifically set forth on SCHEDULE 2.1, together with all prepaid
expenses paid by Seller with respect to such equipment and all third party
insurance proceeds (if any) in respect of losses, liabilities or damage with
respect to such equipment arising out of insured incidents occurring after the
date hereof and prior to the Closing (to the extent Seller and its Affiliates
have no obligation to reimburse the insurer for such insurance proceeds), (ii)
the Intellectual Property set forth on SCHEDULE 3.5 and (iii) the Books and
Records.

      "Books and Records" means all documents, information, computer data,
files, books and records (in each case, in whatever form or media, including
electronic media) that relate exclusively to (i) the Assets or (ii) the Package
Design Team Employees.

      "Business Day" means a day other than a Saturday, a Sunday or a day on
which banks are required or authorized to close in the City of New York.

      "Charter Document" means any of the certificate of incorporation, bylaws,
agreement of limited partnership, operating agreement or other organizational or
constitutive document of a Person.

      "Claim(s)" means any action, suit, litigation, proceeding, arbitration or
other method of settling disputes or disagreements and any grievance, complaint,
claim, charge, demand, investigation or other similar matter.

      "Claims Made Policies" is defined in Section 5.7(b).

      "Closing" means the consummation of the transactions contemplated by this
Agreement on the Closing Date.

      "Closing Date" is defined in the first paragraph of ARTICLE VII.

                                       2

<PAGE>


      "Code" means the United States Internal Revenue Code of 1986, as amended.

      "Consent(s)" means any and all consents, waivers, approvals,
authorizations, declarations, filings, recordings, registrations or exemptions.

      "Damages" means any and all losses, Liabilities, claims, damages,
deficiencies, obligations, fines, payments, Taxes, Encumbrances, and costs and
expenses, whether matured or unmatured, absolute or contingent, accrued or
unaccrued, liquidated or unliquidated, known or unknown, whenever arising and
whether or not resulting from Third Party Claims (including the costs and
expenses of any and all Claims; all amounts paid in connection with any demands,
assessments, judgments, settlements and compromises relating thereto; interest
and penalties with respect thereto; out-of-pocket expenses and reasonable
attorneys', accountants' and other experts' fees and expenses reasonably
incurred in investigating, preparing for or defending against any such Claims or
in asserting, preserving or enforcing an Indemnified Party's rights hereunder;
and any losses that may result from the granting of injunctive relief as a
result of any such Claims).

      "Dispute" is defined in Section 11.3(b).

      "dollars" or "U.S.$" means United States dollars.

      "Effective Time" is defined in the Merger Agreement.

      "Employee Matters Agreement" means the Employee Matters Agreement to be
entered into by and among Seller, Washington and Purchaser on or before the
Effective Time.

      "Encumbrance" means any lien, pledge, easement, security interest,
mortgage, deed of trust, right-of-way, retention of title agreement or other
encumbrance of whatever nature.

      "Governmental Authority" means any federal, state or local governmental
authority or regulatory body of any nation, any subdivision, agency, commission,
board or authority or instrumentality thereof, or any quasi-governmental or
private body asserting, exercising or empowered to assert or exercise any
regulatory authority thereunder and any Person, directly or indirectly, owned by
and subject to the control of any of the foregoing.

      "HSR Act" means the Hart Scott Rodino Antitrust Improvements Act of 1976,
as amended.


                                       3

<PAGE>

      "including" means including without limiting the generality of what
precedes that term.

      "Income Tax" means (a) any Tax based upon, measured by, or calculated with
respect to (i) net income or profits (including, but not limited to, any capital
gains, minimum Tax and any Tax on items of Tax preference, but not including
sales, use, real or personal property, gross or net receipts, transfer or
similar Taxes) or (ii) multiple bases (including, but not limited to, corporate
franchise, doing business or occupation Taxes) if one or more of the bases upon
which such Tax may be based, measured by, or calculated with respect to, is
described in clause (i) above, or (b) any U.S. state or local franchise Tax;
including in the case of each of (a) and (b) any related interest and any
penalties, additions to such Tax or additional amounts imposed with respect
thereto by any Tax authority.

      "Indemnified Party" is defined in Section 8.3(a).

      "Indemnifying Party" is defined in Section 8.3(a).

      "Indemnity Reduction Amounts" is defined in Section 8.3(a).

      "Information" means all records, books, contracts, instruments, computer
data and other data and information (in each case, in whatever form or medium,
including electronic media).

      "Insurance Proceeds" means monies (a) received by an insured from an
insurance carrier, (b) paid by an insurance carrier on behalf of an insured or
(c) received from any third party in the nature of insurance, contribution or
indemnification in respect of any Liability.

      "Intellectual Property" means trademarks, service marks, brand names,
certification marks, trade dress and other indications of origin, the goodwill
associated with the foregoing and registrations in any jurisdiction of, and
applications in any jurisdiction to register, the foregoing, including any
extension, modification or renewal of any such registration or application;
inventions, discoveries and ideas, whether patentable or not, in any
jurisdiction; patents, applications for patents (including divisions,
continuations, continuations in part and renewal applications), and any
renewals, extensions or reissues thereof, in any jurisdiction; nonpublic
information, trade secrets and confidential information and rights in any
jurisdiction to limit the use or disclosure thereof by any Person; writings and
other works, whether copyrightable or not, in any jurisdiction; and
registrations or applications for registration of copyrights in any
jurisdiction, and any renewals or extensions thereof; and any other intellectual
property or proprietary rights.


                                       4

<PAGE>


      "Law" means all laws, principals of common law, statutes, constitutions,
treaties, rules, regulations, ordinances, codes, ruling, orders and
determinations of any Governmental Authority.

      "Liabilities" means any and all claims, debts, liabilities, commitments
and obligations of whatever nature, whether fixed, contingent or absolute,
matured or unmatured, liquidated or unliquidated, accrued or not accrued, known
or unknown, due or to become due, whenever or however arising and whether or not
the same would be required by generally accepted accounting principles to be
reflected as a liability in financial statements or disclosed in the notes
thereto.

      "Maquiladora" means Conexant Systems, S.A. de C.V., a sociedad anonima de
capital variable organized under the laws of Mexico.

      "Material Adverse Change" or "Material Adverse Effect" means any event,
change, circumstance or development that is materially adverse to (i) the
ability of Seller to consummate the transactions contemplated by this Agreement
or (ii) the Assets taken as a whole or the use of the Assets, taken as a whole,
in the manner heretofore used by Seller, other than, with respect to clause
(ii), any event, change, circumstance or development (A) resulting from any
action taken in connection with the transactions contemplated hereby pursuant to
the terms of this Agreement, (B) relating to the economy or financial markets in
general, (C) relating in general to the industries in which Seller operates and
not specifically relating to Seller or (D) relating to any action or omission of
Seller or any Subsidiary of either of them taken with the express prior written
consent of Purchaser.

      "Merger" is defined in the recitals of the Merger Agreement.

      "Merger Agreement" means the Agreement and Plan of Reorganization, dated
as of December 16, 2001, by and among Seller, Washington and Purchaser.

      "Mexican Stock and Asset Purchase Agreement" means that certain Mexican
Stock and Asset Purchase Agreement, dated as of December 16, 2001, by and
between Seller and Purchaser.

      "Non-Income Tax" means any Tax other than an Income Tax.

      "Occurrence Basis Policies" is defined in Section 5.7(b).

      "Package Design Team" is defined in Recital A.

      "Package Design Team Employee(s)" means the persons employed by Seller and
listed on SCHEDULE 3.7(a).

                                       5

<PAGE>


      "Party" and "Parties" are defined in the first paragraph of this
Agreement.

      "Permits" means licenses, permits, authorizations, consents, certificates,
registrations, variances, franchises and other approvals from any Governmental
Authority, including those relating to environmental matters.

      "Permitted Encumbrance" means (i) Encumbrances for Taxes, assessments or
governmental charges or levies on property not yet due and payable or which are
being contested in good faith and for which appropriate reserves are maintained,
(ii) Encumbrances of landlords, carriers, warehousemen, mechanics and other
Encumbrances imposed by law and incurred in the ordinary course of business as
currently operated, (iii) Encumbrances for purchase money obligations incurred
in the ordinary course of business consistent with past practice and (iv)
Encumbrances incurred in the ordinary course of business which, individually or
in the aggregate, would not reasonably be expected to have a Material Adverse
Effect.

      "Person" means an individual, corporation, limited liability entity,
partnership, association, trust, unincorporated organization, other entity or
group (as defined in the Exchange Act), including any Governmental Authority.

      "Policies" means all insurance policies, insurance contracts and claim
administration contracts of any kind of Seller relating to the Assets which were
or are in effect at any time at or prior to the Closing, including primary,
excess and umbrella, commercial general liability, fiduciary liability, product
liability, automobile, aircraft, property and casualty, business interruption,
directors and officers liability, employment practices liability, workers'
compensation, crime, errors and omissions, special accident, cargo and employee
dishonesty insurance policies and captive insurance company arrangements,
together with all rights, benefits and privileges thereunder.

      "Privileged Information" means, with respect to a Party, Information
regarding the Party, or any of its operations, employees, assets or Liabilities
(whether in documents or stored in any other form or known to its employees or
agents) that is or may be protected from disclosure pursuant to the
attorney-client privilege, the work product doctrine or other applicable
privileges, that a Party has or may come into possession of or has obtained or
may obtain access to pursuant to this Agreement or otherwise.

      "Promissory Note" means a promissory note issued by Purchaser in favor of
Seller in a principal amount equal to the Purchase Price, substantially on the
terms attached hereto as EXHIBIT "A".

                                       6

<PAGE>


      "Purchase Price" means the amount allocated to the purchase price of the
Assets being sold hereunder pursuant to the terms of Section 2.5 of the Mexican
Stock and Asset Purchase Agreement.

      "Purchaser" is defined in the first paragraph of this Agreement.

      "Purchaser Indemnified Parties" is defined in Section 8.1.

      "Representative" means, with respect to any Person, any of such Person's
directors, officers, employees, agents, consultants, advisors, accountants,
attorneys and representatives.

      "Schedules" means the disclosure schedules contained in this Agreement
which schedules are attached hereto and incorporated by reference as if
specifically set forth herein.

      "Seller" is defined in the first paragraph of this Agreement.

      "Seller Indemnified Parties" is defined in Section 8.2.

      "Seller Spinoff" is defined in Section 5.8(c).

      "Subsidiary" when used with respect to any Person means any corporation or
other organization, whether incorporated or unincorporated, at least a majority
of the securities or other interests of which having by their terms ordinary
voting power to elect a majority of the Board of Directors or others performing
similar functions with respect to such corporation or other organization is,
directly or indirectly, owned or controlled by such Person or by any one or more
of its Subsidiaries, or by such Person and one or more of its Subsidiaries.

      "Tax" and "Taxes" shall mean all forms of taxation, whenever created or
imposed, and whether of the United States or elsewhere, and whether imposed by a
federal, state, municipal, governmental, territorial, local, foreign or other
body, and without limiting the generality of the foregoing, shall include net
income, gross income, gross receipts, sales, use, value added, ad valorem,
transfer, recording, franchise, profits, license, lease, service, service use,
payroll, wage, withholding, employment, unemployment insurance, workers
compensation, social security, excise, severance, stamp, business license,
business organization, occupation, premium, property, environmental, windfall
profits, customs, duties, alternative minimum, estimated or other taxes, fees,
premiums, assessments or charges of any kind whatever imposed or collected by
any governmental entity or political subdivision thereof, together with any
related

                                       7

<PAGE>

interest and any penalties, additions to such tax or additional amounts imposed
with respect thereto by any Tax authority.

      "Tax Proceeding" means any audit, examination, Claim or other
administrative or judicial proceeding relating to Taxes or Tax Returns.

      "Tax Return" shall mean any return, filing, questionnaire, information
return, election or other document required or permitted to be filed, including
requests for extensions of time, filings made with respect to estimated tax
payments, claims for refund and amended returns that may be filed, for any
period with any Tax authority (whether domestic or foreign) in connection with
any Tax (whether or not a payment is required to be made with respect to such
filing).

      "Third Party Claim" is defined in Section 8.4(a).

      "To the knowledge of Seller" or words of similar import with respect to a
fact or matter means the actual knowledge of the executive officers of Seller
listed on SCHEDULE 1 after reasonable inquiry.

      "Washington" means Washington Sub, Inc., a Delaware corporation.

      "Washington Business" is defined in the Merger Agreement.

      "Washington Participants" is defined in the Employee Matters Agreement.

                                   ARTICLE II

                           SALE AND PURCHASE OF ASSETS


      Section 2.1. PURCHASE AND SALE OF ASSETS. At the Closing, Seller shall
sell, transfer, convey, assign and deliver to Purchaser, and Purchaser shall
purchase, acquire and accept, the Assets, as the same shall exist on the Closing
Date, free and clear of any Encumbrances other than Permitted Encumbrances.

      Section 2.2. PURCHASE PRICE. The Purchase Price to be paid by Purchaser to
Seller in consideration for the Assets shall be payable, at the election of
Purchaser, either (A) by wire transfer of immediately available funds at the
Closing or (B) by delivery of the Promissory Note at the Closing; PROVIDED,
HOWEVER, that if Purchaser shall elect to pay the Purchase Price pursuant to
clause (B), Purchaser shall provide written notice of such election to Seller no
later than thirty (30) days prior to the Closing Date.

                                       8

<PAGE>


      Section 2.3. NO ASSUMPTION OF LIABILITIES. Purchaser shall not assume
hereunder any Liabilities of Seller related to the Assets. This section shall
not affect any other obligation of Purchaser under this Agreement.

      Section 2.4. ALLOCATION OF PURCHASE PRICE. Purchaser and Seller mutually
agree that the Purchase Price shall be allocated among the Assets in the manner
required by Section 1060 of the Code and Treasury Regulations promulgated
thereunder. Purchaser and Seller shall agree upon such allocation prior to the
Closing and shall file Form 8594 with the United States Internal Revenue Service
reflecting such allocation. Neither Seller nor Purchaser shall take a position
inconsistent with such allocation in any Tax Proceeding, in any refund claim, in
any litigation or investigation or otherwise. If a competent Government
Authority adjusts such allocation for any reason, the allocation shall be deemed
to be amended to conform to any such adjustments.

                                  ARTICLE III

                     SELLER'S REPRESENTATIONS AND WARRANTIES


      Seller hereby represents and warrants to Purchaser as of the date hereof
and as of the Closing Date the following:

      Section 3.1. CORPORATE STATUS, GOOD STANDING AND AUTHORIZATION. Seller is
a corporation duly incorporated, validly existing and in good standing under the
laws of its jurisdiction of incorporation, with all requisite corporate power
and authority to own the Assets, except where the failure to have such power and
authority, individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect. Seller is duly licensed or qualified to do
business as a foreign corporation in all states or jurisdictions in which the
nature of Assets or the operations thereof by the Package Design Team requires
such license or qualification, except where the failure to be so licensed or
qualified, individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect.

      Section 3.2. AUTHORITY; ENFORCEABILITY. Seller has all requisite corporate
power and authority to enter into this Agreement and perform its obligations
under this Agreement. The execution, delivery and performance of this Agreement
by Seller and the consummation by Seller of the transactions contemplated hereby
have been duly authorized by all necessary corporate action on the part of
Seller. This Agreement has been duly authorized, executed and delivered by
Seller and is a legally valid and binding obligation of Seller (assuming that
this Agreement constitutes the valid and binding obligation of Purchaser) and is
enforceable against Seller in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,


                                       9

<PAGE>


fraudulent conveyance, moratorium and similar Laws relating to or affecting
creditors generally or by general equity principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

      Section 3.3. CONSENTS; NO CONFLICTS OR VIOLATIONS. Except for the Consents
set forth on SCHEDULE 3.3 and Consents which if not obtained and maintained by
Seller, individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect, there are no Consents of any Governmental
Authority required in connection with (i) Seller's execution and delivery of
this Agreement and the other agreements, documents and instruments to be
executed and delivered by Seller in connection herewith or (ii) the performance
by Seller of its obligations herein or therein or the consummation by Seller of
the transactions contemplated hereby or thereby. Assuming receipt of all of the
Consents set forth on SCHEDULE 3.3 (including any required HSR Act approval),
neither the execution or delivery by Seller of this Agreement nor the
consummation by Seller of the transactions contemplated hereby will, with or
without the giving of notice or the lapse of time or both, conflict with or
result in a breach or violation of or give rise to a default or right of
termination, amendment, cancellation or acceleration under (i) any provision of
Seller's Charter Documents, (ii) any contract, agreement, note, bond, mortgage,
indenture, lease, license, franchise, permit, concession, instrument or
obligation to which Seller is a party or by which any of its properties or
assets are bound or (iii) any Law or license or other requirement to which
Seller or its properties or assets is subject, except, in the case of items (ii)
and (iii) above only, for those which, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect.

      Section 3.4. COMPLIANCE WITH LAWS. Except as disclosed on SCHEDULE 3.4,
Seller is in compliance in all material respects with all Laws applicable with
respect to the Assets, the manner in which the Assets are used and the Package
Design Team, except where the failure to so comply, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect,
and Seller has not received within the past twelve (12) months any written
notice or correspondence from any Governmental Authority to the effect that it
is not in compliance with any such applicable Laws, except for such violations
which, individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect.

      Section 3.5. INTELLECTUAL PROPERTY. Except as would not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect: (i)
Seller owns, or is licensed to use (in each case, free and clear of any
Encumbrances), all Intellectual Property set forth on SCHEDULE 3.5; (ii) to the
knowledge of Seller, the use of any Intellectual Property set forth on SCHEDULE
3.5 by Seller does not infringe on or otherwise violate the rights of any
Person; (iii) the use of Intellectual Property set forth on SCHEDULE 3.5 by or
on behalf of Seller is in accordance with any applicable license


                                       10

<PAGE>

pursuant to which Seller acquired the right to use any Intellectual Property;
(iv) to the knowledge of Seller, no Person is challenging, infringing on or
otherwise violating any right of Seller with respect to any Intellectual
Property set forth on SCHEDULE 3.5 owned by and/or licensed to Seller; and (v)
Seller does not have any knowledge of any pending claim, order or proceeding
with respect to any use of Intellectual Property set forth on SCHEDULE 3.5 by
Seller and, to the knowledge of Seller, no Intellectual Property set forth on
SCHEDULE 3.5 is being used or enforced in a manner that would reasonably be
expected to result in the abandonment, cancellation or unenforceability of such
Intellectual Property.

      Section 3.6. LITIGATION. Except as set forth on SCHEDULE 3.6, there is no
action, suit or proceeding or regulatory investigation pending or, to the
knowledge of Seller, threatened against Seller or its business or operations
affecting the Package Design Team or any of the Assets or this Agreement before
any court or arbitrator or any governmental body, agency or official, except for
those which, if adversely determined, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect. Seller is not a
party to or subject to any judgment, order, rule, writ, injunction, or decree of
any Governmental Authority or arbitrator which relates to or affects the Assets
or the Package Design Team, except as, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect.

      Section 3.7. EMPLOYEE MATTERS.

      (a) PACKAGE DESIGN TEAM EMPLOYEES. SCHEDULE 3.7(A) contains a list of all
current Package Design Team Employees as of the date hereof.

      Section 3.8. LABOR RELATIONS. Except as stated on SCHEDULE 3.8, as of the
date hereof, Seller is not a signatory to any collective bargaining agreement
with any trade union or labor organization relating to Package Design Team
Employees.

      Section 3.9. TAX MATTERS.

      (a) All material Tax Returns required to be filed by Seller with respect
to the Assets have been timely filed. All such Tax Returns are true, correct and
complete, except as, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect. All Taxes shown as due and payable
by or with respect to such Tax Returns have been timely paid in full.

      (b) Except as set forth on SCHEDULE 3.9(B), there are no Tax proceedings
presently pending with regard to any Non-Income Taxes related to the Assets, and
no notice has been received from any Governmental Authority of the expected
commencement of such a Tax Proceeding.


                                       11

<PAGE>


      (c) There are no Encumbrances for any Tax on the Assets, except for
Permitted Encumbrances.

      (d) None of the Assets is a lease made pursuant to Section 168(f)(8) of
the Internal Revenue Code of 1954.

      (e) None of the Assets constitute "tax exempt use property" within the
meaning of Section 168(h) of the Code or is "tax exempt bond financed property"
within the meaning of Section 168(g) of the Code.

      Section 3.10. NO BROKERS. Neither this Agreement nor the sale of the
Assets was induced or procured through any Person acting on behalf of or
representing Seller and no commissions or any other payment is due to any
intermediary in connection therewith.

      Section 3.11. TITLE TO PROPERTIES. Seller has good and valid title to the
Assets, except, in each case, where the failure to have such good and valid
title, or valid leasehold interest, would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

      Section 3.12. INSURANCE. Seller maintains insurance coverage in respect of
the Assets with reputable insurers in such amounts and covering such risks as is
deemed reasonably appropriate for its business (taking into account the cost and
availability of such insurance).

                                   ARTICLE IV

                   PURCHASER'S REPRESENTATIONS AND WARRANTIES


      Purchaser hereby represents and warrants to Seller as of the date hereof
and as of the Closing Date the following:

      Section 4.1. ORGANIZATION OF PURCHASER. Purchaser is a corporation duly
incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation.

      Section 4.2. AUTHORITY; ENFORCEABILITY. Purchaser has all requisite
corporate power and authority to enter into this Agreement and perform its
obligations under this Agreement. The execution, delivery and performance of
this Agreement by Purchaser and the consummation by Purchaser of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of Purchaser. This Agreement has been duly
authorized, executed and delivered by Purchaser and is a

                                       12

<PAGE>


legally valid and binding obligation of Purchaser (assuming that this Agreement
constitutes the valid and binding obligation of Seller) and is enforceable
against Purchaser in accordance with its terms, except as such enforceability
may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium and similar Laws relating to or affecting creditors generally or by
general equity principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law).

      Section 4.3. CONSENTS; NO CONFLICTS OR VIOLATIONS. Except for the Consents
set forth on SCHEDULE 4.3 and the Consents which if not obtained and maintained
by Purchaser, individually or in the aggregate, would not reasonably be expected
to have a material adverse effect on Purchaser's ability to consummate the
transactions contemplated by this Agreement, there are no Consents of any
Governmental Authorities required in connection with (i) Purchaser's execution
and delivery of this Agreement and the other agreements, documents and
instruments to be executed and delivered by Purchaser in connection herewith or
(ii) the performance by Purchaser of its obligations herein or therein or the
consummation by Seller of the transactions contemplated hereby or thereby.
Assuming receipt of all of the Consents set forth on SCHEDULE 4.3 (including,
any required HSR Act approval), neither the execution or delivery by Purchaser
of this Agreement nor the consummation by Purchaser of the transactions
contemplated hereby will, with or without the giving of notice or the lapse of
time or both, conflict with or result in a breach or violation of or give rise
to a default or right of termination, amendment, cancellation or acceleration
under (i) any provision of Purchaser's Charter Documents, (ii) any material
contract, agreement, note, bond, mortgage, indenture, lease, license, franchise,
permit, concession, instrument or obligation to which Purchaser is a party or by
which any of its properties or assets are bound or (iii) any Law or license or
other requirement to which Purchaser or its properties or assets is subject,
except, in the case of items (ii) and (iii) above only, for those which,
individually or in the aggregate, would not reasonably be expected to have a
material adverse effect on Purchaser's ability to consummate the transactions
contemplated by this Agreement.

      Section 4.4. LITIGATION. Except as set forth on SCHEDULE 4.4, there is no
action, suit or proceeding or regulatory investigation pending or, to the
knowledge of Purchaser, threatened against Purchaser affecting this Agreement
before any court or arbitrator or any governmental body, agency or official,
except for those which, if adversely determined, individually or in the
aggregate, would not reasonably be expected to have a material adverse effect on
Purchaser's ability to consummate the transactions contemplated by this
Agreement. Purchaser is not a party to or subject to any judgment, order, writ,
injunction, or decree of any Governmental Authority or arbitrator, except as,
individually or in the aggregate, would not reasonably be expected to have a
material

                                       13

<PAGE>

adverse effect on Purchaser's ability to consummate the transactions
contemplated by this Agreement.

      Section 4.5. NO BROKERS. Neither this Agreement nor the purchase of the
Assets was induced or procured through any Person acting on behalf of or
representing Purchaser and no commissions or any other payment is due to any
intermediary in connection therewith.

                                   ARTICLE V

                                    COVENANTS


      The Parties hereby covenant as follows:

      Section 5.1. ACCESS.

      (a) ACCESS TO INFORMATION BY PURCHASER PRIOR TO CLOSING. Prior to Closing,
subject to compliance with applicable laws, Seller and Maquiladora shall, upon
reasonable request, afford to Purchaser and its Representatives reasonable
access during normal business hours to all Books and Records. Purchaser shall
coordinate its requests and activities under this Section 5.1 with Seller's need
for security and will assist Seller in minimizing disruption to Seller's normal
business operations.

      (b) ACCESS TO INFORMATION BY PURCHASER AFTER CLOSING. From and after the
Closing, Seller will afford to Purchaser and its Representatives (at Purchaser's
expense) reasonable access and duplicating rights during normal business hours
and upon reasonable advance notice to all Books and Records within Seller's
possession or control relating to the Assets, insofar as such access is
reasonably required by Purchaser.

      (c) ACCESS TO BOOKS AND RECORDS BY SELLER. Purchaser shall, following the
Closing, give Seller and its Representatives such access, during normal business
hours and upon reasonable prior notice, to the Books and Records and such other
documents as shall be reasonably necessary for Seller in connection with its
performance of its obligations hereunder, for the preparation and filing of
Seller's Tax Returns for periods prior to the Closing Date and for any other
reasonable purposes, and Purchaser will allow Seller and its Representatives to
make extracts and copies thereof as may be necessary for such purposes at
Seller's expense. Purchaser shall preserve and protect the Books and Records in
its possession and control for the period required by the applicable records
retention policy of Seller in effect immediately prior to the Closing. Purchaser
shall offer to deliver the Books and Records to Seller prior to their
destruction or other disposition.


                                       14

<PAGE>


      (d) PRODUCTION OF WITNESSES. Subject to Section 5.1(e), after the Closing,
each Party will make available to the other Party, upon written request and at
the cost and expense of the Party so requesting, its directors, officers,
employees and agents as witnesses to the extent that any such Person may
reasonably be required (giving consideration to business demands of such
directors, officers, employees and agents) in connection with any Claims or
administrative or other proceedings in which the requesting party may from time
to time be involved and relating to the Assets or the Package Design Team or
arising in connection with the relationship between the Parties on or prior to
the Closing Date, provided that the same shall not unreasonably interfere with
the conduct of business by the Party of which the request is made.

      (e) CONFIDENTIALITY. From and after the Closing, each of Seller and
Purchaser shall hold, and shall use reasonable efforts to cause its Affiliates
and Representatives to hold, in strict confidence all Information concerning the
other Party in its possession or control prior to the Closing or furnished to it
by another Party pursuant to the Merger and the transactions contemplated
thereby and will not release or disclose such Information to any other Person,
except its Affiliates and its and their Representatives, who will be bound by
the provisions of this Section 5.1(e); PROVIDED, HOWEVER, that any Person may
disclose such Information to the extent that (a) disclosure is compelled by
judicial or administrative process or, in the opinion of such Person's counsel,
by other requirements of law (in which case the Party required to make such
disclosure will notify the other Party as soon as practicable of such obligation
or requirement and cooperate with the other Party to limit the Information
required to be disclosed and to obtain a protective order or other appropriate
remedy with respect to the Information ultimately disclosed) or (b) such Person
can show that such Information was (i) available to such Person on a
nonconfidential basis (other than from a Party) prior to its disclosure by such
Person, (ii) in the public domain through no fault of such Person or (iii)
lawfully acquired by such Person from another source after the time that it was
furnished to such Person by the other Party or its Affiliates, Representatives
or Subsidiaries, and not acquired from such source subject to any
confidentiality obligation on the part of such source known to the acquiror, or
on the part of the acquiror. Each Party acknowledges that it will be liable for
any breach of this Section 5.1(e) by its Affiliates, Representatives and
Subsidiaries. Notwithstanding the foregoing, each Party will be deemed to have
satisfied its obligations under this Section 5.1(e) with respect to any
Information (other than Privileged Information) if it exercises the same care
with regard to such Information as it takes to preserve confidentiality for its
own similar Information.

      Section 5.2. REASONABLE BEST EFFORTS.

      (a) Subject to the terms and conditions of this Agreement, each Party will
use its reasonable best efforts to take, or cause to be taken, all actions and
to do, or


                                       15

<PAGE>


cause to be done, and to assist and cooperate with the other Party in doing or
causing to be done, all things necessary, proper or advisable under this
Agreement and applicable laws to consummate the transactions contemplated by
this Agreement as soon as practicable after the date hereof, including (i)
preparing and filing as promptly as practicable all documentation to obtain as
promptly as practicable all Consents set forth on SCHEDULES 3.3 AND 4.3 and (ii)
taking all reasonable steps as may be necessary to obtain all Consents set forth
on SCHEDULES 3.3 AND 4.3. In furtherance and not in limitation of the foregoing,
each Party hereto agrees to make (i) an appropriate filing (if applicable) of a
Notification and Report Form pursuant to the HSR Act with respect to the
transactions contemplated hereby as promptly as practicable after the date
hereof and (ii) all other necessary filings with other Governmental Authorities
relating to the transactions contemplated herein, and, in each case, to supply
as promptly as practicable any additional information and documentary material
that may be requested pursuant to such applicable laws or by such Governmental
Authorities and to use reasonable best efforts to cause the expiration or
termination of the applicable waiting periods under the HSR Act and the receipt
of the Consents set forth on SCHEDULES 3.3 AND 4.3 under such other applicable
laws or from such Governmental Authorities as soon as practicable.

      (b) Each of Seller and Purchaser shall, in connection with the efforts
referenced in Section 5.2(a) to obtain all Consents set forth on SCHEDULES 3.3
AND 4.3, use its reasonable best efforts to (i) cooperate in all respects with
each other in connection with any filing or submission and in connection with
any investigation or other inquiry, including any proceeding initiated by a
private party, (ii) promptly inform the other Party of any communication
received by such Party from, or given by such Party to, the Antitrust Division
of the Department of Justice (the "DOJ"), the Federal Trade Commission (the
"FTC") or any other Governmental Authority and of any material communication
received or given in connection with any proceeding by a private party, in each
case regarding any of the transactions contemplated hereby, and (iii) permit the
other Party to review any communication given by it to, and consult with each
other in advance of any meeting or conference with, the DOJ, the FTC or any such
other Governmental Authority or, in connection with any proceeding by a private
party, with any other Person, and to the extent appropriate or permitted by the
DOJ, the FTC or such other applicable Governmental Authority or other Person,
give the other Party the opportunity to attend and participate in such meetings
and conferences.

      (c) In furtherance and not in limitation of the covenants of the Parties
contained in Section 5.2(a) and Section 5.2(b), if any administrative or
judicial action or proceeding, including any proceeding by a private party, is
instituted (or threatened to be instituted) challenging any transaction
contemplated by this Agreement as violative of any applicable laws, or if any
statute, rule, regulation, executive order, decree, injunction or administrative
order is enacted, entered, promulgated or enforced by a Governmental Authority
which would make transactions contemplated hereby illegal or would



                                       16
<PAGE>


otherwise prohibit or materially impair or delay the consummation of the
transactions contemplated hereby, each of the Parties shall cooperate in all
respects with each other and use its respective reasonable best efforts to
contest and resist any such action or proceeding and to have vacated, lifted,
reversed or overturned any decree, judgment, injunction or other order, whether
temporary, preliminary or permanent, that is in effect and that prohibits,
prevents or restricts consummation of the transactions contemplated by this
Agreement and to have such statute, rule, regulation, executive order, decree,
injunction or administrative order repealed, rescinded or made inapplicable so
as to permit the consummation of the transactions contemplated by this
Agreement.

            (d) Notwithstanding the foregoing or any other provision of this
Agreement, nothing in this Section 5.2 shall create an obligation by the Parties
to take any action in addition to the actions required to be taken pursuant to
the Merger Agreement to consummate the Merger.

            Section 5.3. CONDUCT OF BUSINESS BY SELLER. From the data hereof
until the Closing Date, Seller shall, except as expressly required or permitted
by this Agreement and except as otherwise consented to in writing by Purchaser:

            (i) conduct the operations of the Package Design Team and employ the
      Assets in the ordinary course of business consistent with past practice;

            (ii) not grant, create, incur or suffer to exist any Encumbrance
      (other than a Permitted Encumbrance granted, created, incurred or suffered
      to exist in the ordinary course of business consistent with past practice)
      on the Assets;

            (iii) not increase in any manner the base compensation of, or enter
      into any new bonus or incentive agreement or arrangement with, any Package
      Design Team Employees, other than in the ordinary course of business
      consistent with past practice;

            (iv) not adopt or amend any Benefit Plan with respect to Package
      Design Team Employees or to increase the benefits provided under any
      Benefit Plan to Package Design Team Employees other than in the ordinary
      course of business consistent with past practice;

            (v) not grant any license or sublicense or otherwise transfer, other
      than in the ordinary course of business consistent with past practice, any
      portion of its right, title or interest in any Intellectual Property
      included in the Assets; and

            (vi) not authorize, or commit or agree to take, any of the foregoing
      actions.


                                       17

<PAGE>


            Section 5.4. EMPLOYMENT ARRANGEMENTS.

            (a) EMPLOYMENT. Purchaser shall offer employment, with comparable
compensation and benefits, commencing as of the Closing Date, to each of the
Package Design Team Employees (including those who are actively employed or on
layoff, leave or short-term or long-term disability or other permitted absence
from employment). Purchaser shall provide to each Package Design Team Employee
(i) employment and a salary or wage level at least equal to that which such
Package Design Team Employee was entitled from Seller and its Subsidiaries and
Affiliates immediately prior to the Closing Date and (ii) employee benefits
comparable in all material respects to and no less favorable in the aggregate
than the employee benefits provided to each such Package Design Team Employee by
Seller and its Subsidiaries and Affiliates immediately prior to the Closing
Date; PROVIDED, HOWEVER, that after the Closing Date, Purchaser expressly
reserves the right to modify any salary or wage level of any Package Design Team
Employee and to amend, modify or terminate any benefit plan or program
established or maintained by Purchaser for the benefit of Package Design Team
Employees in accordance with the terms of such plan or program and applicable
law.

            (b) EMPLOYEE MATTERS AGREEMENT TERMS APPLICABLE. The Parties agree
that all terms and provisions of the Employee Matters Agreement applicable to
Washington Participants (including all Liabilities and obligations assumed or to
be performed by Purchaser or Washington under the Employee Matters Agreement
relating to the Washington Participants) shall, to the extent applicable, also
apply to the Package Design Team Employees, and that the Package Design Team
Employees shall be deemed to be Washington Participants for all purposes of the
Employee Matters Agreement (other than Section 2.01 thereof). Accordingly,
Purchaser hereby assumes, and agrees to fully perform, pay and discharge, all
Liabilities and obligations in respect of the Package Design Team Employees of
the type that were assumed by or allocated to Purchaser, Washington or any
Subsidiary of Washington under the Employee Matters Agreement in respect of
Washington Participants and to perform, pay and discharge such Liabilities and
obligations in the same manner as provided in the Employee Matters Agreement.

            Section 5.5. PUBLIC ANNOUNCEMENTS. The Parties shall use reasonable
best efforts to develop a joint communications plan and each Party shall use
reasonable best efforts (i) to ensure that all press releases and other public
statements with respect to the transactions contemplated hereby shall be
consistent with such joint communications plan, and (ii) unless otherwise
required by applicable laws or by obligations pursuant to any listing agreement
with or rules of any securities exchange or automated quotation system, to
consult with each other before issuing any press release or, to the extent
practicable, otherwise making any public statement with respect to this
Agreement or the transactions contemplated hereby.


                                       18

<PAGE>


            Section 5.6. SUPPLEMENTS TO SCHEDULES. From time to time up to the
Closing, Seller and Purchaser may supplement or amend the Schedules after they
have been delivered pursuant to this Agreement with respect to any matter first
existing or occurring on or after the date hereof which, if existing or
occurring at or prior to the date hereof, would have been required to be set
forth or described in such Schedules or which is necessary to correct any
information in such Schedules which has been rendered inaccurate thereby;
PROVIDED, HOWEVER, that if any facts that give rise to such matter existed or
occurred on or before the date hereof, no such supplement or amendment may be
made under this Section 5.6 with respect thereto. Any supplement or amendment to
any Schedule shall not, following Closing, constitute a basis for any Claim for
indemnification pursuant to ARTICLE VIII.

            Section 5.7. INSURANCE.

            (a) COVERAGE. Subject to the provisions of this Section 5.7,
coverage of the Assets under all Policies shall cease as of the Closing. From
and after the Closing, Purchaser will be responsible for obtaining and
maintaining all insurance coverages for the Assets. All Policies will be
retained by Seller and Seller's Subsidiaries, together with all rights, benefits
and privileges thereunder (including the right to receive any and all return
premiums with respect thereto), except that Purchaser will have the rights in
respect of Policies to the extent described in Section 5.7(b).

            (b) RIGHTS UNDER POLICIES. From and after the Closing, Purchaser
will have no rights with respect to any Policies, except that (i) Purchaser will
have the right to assert claims (and Seller will use commercially reasonable
efforts to assist Purchaser in asserting claims) for any loss, liability or
damage with respect to the Assets under Policies with third-party insurers which
are "occurrence basis" insurance policies ("Occurrence Basis Policies") arising
out of insured incidents occurring from the date coverage thereunder first
commenced until the Closing to the extent that the terms and conditions of any
such Occurrence Basis Policies and agreements relating thereto so allow and (ii)
Purchaser will have the right to continue to prosecute claims with respect to
the Assets properly asserted with an insurer prior to the Closing (and Seller
will use commercially reasonable efforts to assist Purchaser in connection
therewith) under Policies with third-party insurers which are insurance policies
written on a "claims made" basis ("Claims Made Policies") arising out of insured
incidents occurring from the date coverage thereunder first commenced until the
Closing to the extent that the terms and conditions of any such Claims Made
Policies and agreements relating thereto so allow, PROVIDED, that in the case of
both clauses (i) and (ii) above, (A) all of Seller's reasonable out-of-pocket
costs and expenses incurred in connection with the foregoing are promptly paid
by Purchaser, (B) Seller may, at any time, without liability or obligation to
Purchaser (other than as set forth in Section 5.7(c)), amend, commute,
terminate, buy-out, extinguish liability under or otherwise modify any
Occurrence Basis Policies or Claims


                                       19

<PAGE>


Made Policies (and such claims shall be subject to any such amendments,
commutations, terminations, buy-outs, extinguishments and modifications), (C)
such claims will be subject to (and recovery thereon will be reduced by the
amount of) any applicable deductibles, retentions or self-insurance provisions,
(D) such claims will be subject to (and recovery thereon will be reduced by the
amount of) any payment or reimbursement obligations of Seller, any of Seller's
Subsidiaries or any Affiliate of Seller or any of Seller's Subsidiaries in
respect thereof and (E) such claims will be subject to exhaustion of existing
aggregate limits. Seller's obligation to use commercially reasonable efforts to
assist Purchaser in asserting claims under applicable Policies will include
using commercially reasonable efforts in assisting Purchaser to establish its
right to coverage under such Policies (so long as all of Seller's reasonable
out-of-pocket costs and expenses in connection therewith are promptly paid by
Purchaser). None of Seller or Seller's Subsidiaries will bear any Liability for
the failure of an insurer to pay any claim under any Policy. It is understood
that any Claims Made Policies will not provide any coverage to Purchaser for
incidents occurring prior to the Closing but which are asserted with the
insurance carrier after the Closing.

            (c)   SELLER ACTIONS. In the event that after the Closing, Seller
proposes to amend, commute, terminate, buy-out, extinguish liability under or
otherwise modify any Policies under which Purchaser has rights to assert claims
pursuant to Section 5.7(b) in a manner that would adversely affect any such
rights of Purchaser, (i) Seller will give Purchaser prior notice thereof and
consult with Purchaser with respect to such action (it being understood that the
decision to take any such action will be in the sole discretion of Seller) and
(ii) Seller will pay to Purchaser its equitable share (which shall be determined
by Seller in good faith based on the amount of premiums paid by or allocated to
Purchaser or the Assets in respect of the applicable Policy) of any net proceeds
actually received by Seller from the insurer under the applicable Policy as a
result of such action by Seller (after deducting Seller's reasonable costs and
expenses incurred in connection with such action).

            (d)   ADMINISTRATION. From and after the Closing:

                  (i) Seller or a Subsidiary of Seller, as appropriate, will be
      responsible for the Claims Administration with respect to claims of Seller
      and Seller's Subsidiaries under Policies; and

                  (ii) Purchaser will be responsible for the Claims
      Administration with respect to claims of Purchaser under Policies.

            (e)   INSURANCE PREMIUMS. From and after the Closing, Seller will
pay all premiums (retrospectively-rated or otherwise) as required under the
terms and conditions of the respective Policies in respect of periods prior to
the Closing, whereupon

                                       20

<PAGE>


Purchaser will upon the request of Seller, forthwith reimburse Seller for that
portion of such premiums paid by Seller as are reasonably determined by Seller
to be attributable to the Assets.

            (f)   AGREEMENT FOR WAIVER OF CONFLICT AND SHARED DEFENSE. In the
event that a Policy provides coverage for both Seller and/or a Subsidiary of
Seller, on the one hand, and Purchaser, on the other hand, relating to the same
occurrence, Seller and Purchaser agree to defend jointly and to waive any
conflict of interest necessary to the conduct of that joint defense. Nothing in
this Section 5.7(f) will be construed to limit or otherwise alter in any way the
indemnity obligations of the parties to this Agreement, including those created
by this Agreement, by operation of law or otherwise.

            Section 5.8. LICENSE OF PURCHASER INTELLECTUAL PROPERTY TO SELLER.

            (a)   Effective as of the Closing Date, Purchaser hereby grants to
Seller, its Subsidiaries and its Affiliates, a non-exclusive, world-wide,
irrevocable royalty-free license, without the right to assign or grant
sublicenses, except as provided in Sections 5.8(b) and (c), under all
Intellectual Property constituting Assets (excluding trademarks, trade names,
domain names, service marks, trade dress and any other form of trade identity),
to make, have made, use, sell, offer for sale, import, or otherwise dispose of
semiconductor products and systems in the conduct of their respective businesses
as they are being conducted on the Closing Date and any related extensions or
expansions thereof, and to practice any process involved in the use or
manufacture thereof.

            (b)   The license granted under Section 5.8(a) is non-assignable and
non-transferable (in insolvency proceedings, by reason of corporate merger, by
acquisition or other change in control or otherwise).

            (c)   The license granted under Section 5.8(a) does not include the
right to grant sublicenses, except that Seller, its Subsidiaries and its
Affiliates may grant a sublicense (within the scope of such license) to any
entity or business that is a spin-off or other similar divestiture of all or any
part of the businesses of Seller, its Subsidiaries and its Affiliates (a "Seller
Spin-Off") and to any subsequent entity or business that is a spin-off or other
similar divestiture of all or any part of a Seller Spin-Off; PROVIDED, HOWEVER,
that any such sublicense shall be subject to the same restrictions on assignment
and transfer as the original license granted in this Section 5.8.

            (d)   In the event that following the Closing, Seller or a Seller
Spin-Off becomes insolvent or is acquired by or merges with a third party, such
license or sublicense shall immediately and automatically terminate with respect
to such Person and its Affiliates effective as of the date of such insolvency,
acquisition or merger, unless


                                       21

<PAGE>


Seller and Purchaser otherwise agree; provided that such termination of such
license or sublicense shall not necessarily affect any other license or
sublicense.

                                   ARTICLE VI

                                  CONDITIONS TO
                      SELLER'S AND PURCHASER'S OBLIGATIONS

            The obligations of Seller and Purchaser to complete the transactions
contemplated by this Agreement are subject to the Closing (as defined in the
Merger Agreement) under the Merger Agreement having been consummated.

                                  ARTICLE VII

                                     CLOSING

            The Closing shall, unless another time and date is agreed to in
writing by the Parties, take place immediately following the Closing (as defined
in the Merger Agreement) under the Merger Agreement and will be effective
immediately following the Effective Time (the time and date of such Closing
being herein called the "Closing Date"). The Closing will take place at the
offices of Chadbourne & Parke LLP, 30 Rockefeller Plaza, New York, New York
10112, or such other place as the Parties may agree. On the Closing Date, the
Parties hereto shall deliver the following:

            Section 7.1. DELIVERIES BY SELLER. At the Closing, Seller shall
deliver to Purchaser the following which in the case of documents, shall be
reasonably satisfactory to Purchaser:

            (i) an Assets Bill of Sale and Assignment and Assumption Agreement,
      duly executed by Seller, in form and substance reasonably satisfactory to
      Purchaser;

            (ii) the Assets; and

            (iii) all documents of title and instruments of conveyance necessary
      to transfer record and beneficial ownership to Purchaser of all Assets
      which require execution, endorsement or delivery of such a document under
      applicable Law in order to vest record or beneficial ownership thereto in
      Purchaser.

                                       22

<PAGE>


            Section 7.2. DELIVERIES BY PURCHASER. At the Closing, Purchaser
shall deliver to Seller the following, which in the case of documents shall be
reasonably satisfactory to Seller:

            (i) (A) cash payment of the Purchase Price (via wire transfer of
      immediately available funds), pursuant to Section 2.3, or (B) the
      Promissory Note, duly executed by Purchaser, in form and substance
      reasonably satisfactory to Seller, in which case, the Purchase shall
      deliver to Seller at Closing, in addition to the other deliveries required
      hereby, (I) a security agreement, duly executed by Purchaser, in form and
      substance reasonably satisfactory to Seller and Purchaser and in customary
      form for transactions of this nature, granting Seller a first priority
      security interest in the security described on EXHIBIT "A", (II) such
      notices, recordings, mortgages, statements, filings, instruments or other
      agreements and documents as Seller may reasonably require to have a
      perfected first priority security interest in the security described on
      EXHIBIT "A" and (III) customary opinions of counsel to Purchaser for
      secured transactions of this nature reasonably satisfactory to the Parties
      and their counsel; and

            (ii) an Asset Bill of Sale and Assignment and Assumption Agreement,
      duly executed by Purchaser, in form and substance reasonably satisfactory
      to Seller.

                                  ARTICLE VIII

                                 INDEMNIFICATION


            Section 8.1. INDEMNIFICATION BY SELLER. Subject to the limitations
on and procedures for indemnification set forth in this ARTICLE VIII, Seller
shall indemnify, defend and hold harmless Purchaser and its Representatives and
Affiliates and each of the heirs, executors, successors and assigns of any of
the foregoing (collectively, the "Purchaser Indemnified Parties") from and
against, and pay or reimburse, as the case may be, the Purchaser Indemnified
Parties for, any Damages, as incurred, suffered by any Purchaser Indemnified
Parties to the extent based upon, arising out of or relating to the following:

            (i) the breach of any representation or warranty of Seller contained
      in this Agreement; or

            (ii) the breach by Seller of any covenant or agreement of Seller
      contained in this Agreement.

                                       23

<PAGE>


            Section 8.2. INDEMNIFICATION BY PURCHASER. Subject to the
limitations on and procedures for indemnification set forth in this ARTICLE
VIII, Purchaser shall indemnify, defend and hold harmless Seller and its
Representatives and Affiliates and each of the heirs, executors, successors and
assigns of any of the foregoing (collectively, the "Seller Indemnified Parties")
from and against, and pay or reimburse, as the case may be, the Seller
Indemnified Parties for, any Damages, as incurred, suffered by any Seller
Indemnified Parties to the extent based upon, arising out of or relating to the
following:

            (i) the breach of any representation or warranty of Purchaser
      contained in this Agreement; or

            (ii) the breach by Purchaser of any covenant or agreement of
      Purchaser contained in this Agreement.

            Section 8.3. LIMITATIONS ON INDEMNIFICATION OBLIGATIONS. (a) The
amount which any Party (an "Indemnifying Party") is or may be required to pay to
any Person (an "Indemnified Party") in respect of Damages or other Liability for
which indemnification is provided under this Agreement shall be reduced by any
amounts actually received (including Insurance Proceeds actually received) by or
on behalf of such Indemnified Party (net of increased insurance premiums and
charges to the extent related to Damages and costs and expenses (including
reasonable legal fees and expenses) incurred by such Indemnified Party in
connection with seeking to collect and collecting such amounts) in respect of
such Damages or other Liability (such net amounts are referred to herein as
"Indemnity Reduction Amounts"). If any Indemnified Party receives any Indemnity
Reduction Amounts in respect of Damages for which indemnification is provided
under this Agreement after the full amount of such Damages has been paid by an
Indemnifying Party or after an Indemnifying Party has made a partial payment of
such Damages and such Indemnity Reduction Amounts exceed the remaining unpaid
balance of such Damages, then the Indemnified Party shall promptly remit to the
Indemnifying Party an amount equal to the excess (if any) of (A) the amount
theretofore paid by the Indemnifying Party in respect of such Damages, less (B)
the amount of the indemnity payment that would have been due if such Indemnity
Reduction Amounts in respect thereof had been received before the indemnity
payment was made.

            (b)   In determining the amount of any indemnity payment under this
Agreement, such amount shall be (i) reduced to take into account any net Tax
benefit realized by the Indemnified Party and its Affiliates arising from the
incurrence or payment by the Indemnified Party or its Affiliates of any amount
in respect of which such payment is made and (ii) increased to take into account
any net Tax cost incurred by the Indemnified Party and its Affiliates as a
result of the receipt or accrual of payments hereunder (grossed-up for such
increase), in each case determined by treating the Indemnified Party and its
Affiliates as recognizing all other items of income, gain, loss,

                                       24

<PAGE>


deduction or credit before recognizing any item arising from the receipt of
accrual of any payment hereunder. In determining the amount of any such Tax
benefit or Tax cost, the Indemnified Party and its Affiliates shall be deemed to
be subject to the applicable Taxes at the maximum statutory rate then in effect.
It is the intention of the Parties to this Agreement that payments made pursuant
to this Agreement are to be treated as relating back to the Closing Date as a
purchase price adjustment, and the Parties shall not take any position
inconsistent with such intention before any Tax authority, except to the extent
that a final determination (as defined in Section 1313 of the Code) with respect
to the recipient party causes any such payment not to be so treated.

            (c)   No monetary amount will be payable by Seller to any Purchaser
Indemnified Party with respect to the indemnification of any claims pursuant to
Section 8.1(i) until the aggregate amount of Damages actually incurred by the
Purchaser Indemnified Parties with respect to such claims shall exceed on a
cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in
which event Seller shall be responsible only for the amount of such Damages in
excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be
payable by Seller to any Purchaser Indemnified Party with respect to the
indemnification of any claims pursuant to Section 8.1(i) after the aggregate
amount of Damages actually paid by Seller with respect to such claims shall
equal on a cumulative basis an amount equal to five hundred thousand dollars
(U.S.$500,000).

            (d)   No monetary amount will be payable by Purchaser to any Seller
Indemnified Party with respect to the indemnification of any claims pursuant to
Section 8.2(i) until the aggregate amount of Damages actually incurred by the
Seller Indemnified Parties with respect to such claims shall exceed on a
cumulative basis an amount equal to fifty thousand dollars (U.S.$50,000), in
which event Purchaser shall be responsible only for the amount of such Damages
in excess of fifty thousand dollars (U.S.$50,000). No monetary amount will be
payable by Purchaser to any Seller Indemnified Party with respect to the
indemnification of any claims pursuant to Section 8.2(i) after the aggregate
amount of Damages actually paid by Purchaser with respect to such claims shall
equal on a cumulative basis an amount equal to five hundred thousand dollars
(U.S.$500,000).

            Section 8.4. PROCEDURES RELATING TO INDEMNIFICATION. (a) If a claim
or demand is made against an Indemnified Party, or an Indemnified Party shall
otherwise learn of an assertion, by any Person who is not a party to this
Agreement (or an Affiliate thereof) as to which an Indemnifying Party may be
obligated to provide indemnification pursuant to this Agreement (a "Third Party
Claim"), such Indemnified Party will notify the Indemnifying Party in writing,
and in reasonable detail, of the Third Party Claim reasonably promptly after
becoming aware of such Third Party Claim; PROVIDED, HOWEVER, that failure to
give such notification will not affect the indemnification provided

                                       25
<PAGE>

hereunder except to the extent the Indemnifying Party shall have been actually
prejudiced as a result of such failure. Thereafter, the Indemnified Party will
deliver to the Indemnifying Party, promptly after the Indemnified Party's
receipt thereof, copies of all material notices and documents (including court
papers) received or transmitted by the Indemnified Party relating to the Third
Party Claim.

            (b)   If a Third Party Claim is made against an Indemnified Party,
the Indemnifying Party will be entitled to participate in or to assume the
defense thereof (in either case, at the expense of the Indemnifying Party) with
counsel selected by the Indemnifying Party and reasonably satisfactory to the
Indemnified Party. Should the Indemnifying Party so elect to assume the defense
of a Third Party Claim, the Indemnifying Party will not be liable to the
Indemnified Party for any legal or other expenses subsequently incurred by the
Indemnified Party in connection with the defense thereof; PROVIDED, HOWEVER,
that if in the Indemnified Party's reasonable judgment a conflict of interest
exists in respect of such claim or if the Indemnifying Party shall have assumed
responsibility for such claim with any reservations or exceptions, such
Indemnified Party will have the right to employ separate counsel reasonably
satisfactory to the Indemnifying Party to represent such Indemnified Party and
in that event the reasonable fees and expenses of such separate counsel (but not
more than one separate counsel for all Indemnified Parties similarly situated)
shall be paid by such Indemnifying Party. If the Indemnifying Party assumes the
defense of any Third Party Claim, the Indemnified Party will have the right to
participate in the defense thereof and to employ counsel, at its own expense,
separate from the counsel employed by the Indemnifying Party, it being
understood that the Indemnifying Party will control such defense. The
Indemnifying Party will be liable for the reasonable fees and expenses of
counsel employed by the Indemnified Party for any period during which the
Indemnifying Party has failed to assume the defense thereof. If the Indemnifying
Party assumes the defense of any Third Party Claim, the Indemnifying Party will
promptly supply to the Indemnified Party copies of all material correspondence
and documents relating to or in connection with such Third Party Claim and keep
the Indemnified Party fully informed of all material developments relating to or
in connection with such Third Party Claim (including providing to the
Indemnified Party on request updates and summaries as to the status thereof). If
the Indemnifying Party chooses to defend a Third Party Claim, the Parties will
cooperate in the defense thereof (such cooperation to be at the expense,
including reasonable legal fees and expenses, of the Indemnifying Party), which
cooperation shall include the retention in accordance with this Agreement and
(upon the Indemnifying Party's request) the provision to the Indemnifying Party
of records and information which are reasonably relevant to such Third Party
Claim, and making employees available on a mutually convenient basis to provide
additional information and explanation of any material provided hereunder.

                                       26

<PAGE>


            (c)   No Indemnifying Party will consent to any settlement,
compromise or discharge (including the consent to entry of any judgment) of any
Third Party Claim without the Indemnified Party's prior written consent (which
consent will not be unreasonably withheld); PROVIDED, HOWEVER, that if the
Indemnifying Party assumes the defense of any Third Party Claim, the Indemnified
Party will agree to any settlement, compromise or discharge of such Third Party
Claim which the Indemnifying Party may recommend and which by its terms
obligates the Indemnifying Party to pay the full amount of Damages in connection
with such Third Party Claim and unconditionally and irrevocably releases the
Indemnified Party and its Affiliates completely from all Liability in connection
with such Third Party Claim; PROVIDED, HOWEVER, that the Indemnified Party may
refuse to agree to any such settlement, compromise or discharge (x) that
provides for injunctive or other non-monetary relief affecting the Indemnified
Party or any of its Affiliates or (y) that, in the reasonable opinion of the
Indemnified Party, would otherwise materially adversely affect the Indemnified
Party or any of its Affiliates. Whether or not the Indemnifying Party shall have
assumed the defense of a Third Party Claim, the Indemnified Party will not
(unless required by law) admit any liability with respect to, or settle,
compromise or discharge, such Third Party Claim without the Indemnifying Party's
prior written consent (which consent will not be unreasonably withheld).

            (d)   Any claim on account of Damages which does not involve a Third
Party Claim will be asserted by reasonably prompt written notice given by the
Indemnified Party to the Indemnifying Party from whom such indemnification is
sought. The failure by any Indemnified Party to so notify the Indemnifying Party
will not relieve the Indemnifying Party from any liability which it may have to
such Indemnified Party under this Agreement, except to the extent that the
Indemnifying Party shall have been actually prejudiced by such failure.

            (e)   In the event of payment in full by an Indemnifying Party to
any Indemnified Party in connection with any Third Party Claim, such
Indemnifying Party will be subrogated to and shall stand in the place of such
Indemnified Party as to any events or circumstances in respect of which such
Indemnified Party may have any right or claim relating to such Third Party Claim
against any claimant or plaintiff asserting such Third Party Claim or against
any other Person. Such Indemnified Party will cooperate with such Indemnifying
Party in a reasonable manner, and at the cost and expense of such Indemnifying
Party, in prosecuting any subrogated right or claim.

            Section 8.5. SOLE AND EXCLUSIVE REMEDY. The indemnities contained in
this ARTICLE VIII shall be the sole and exclusive remedies of the Parties
hereto, their Affiliates, successors and assigns with respect to any and all
claims arising out of or relating to this Agreement, the transactions
contemplated hereby, any provision hereof or the breach or performance thereof.

                                       27

<PAGE>


            Section 8.6. TERMINATION OF INDEMNIFICATION OBLIGATIONS. Except as
set forth in the following sentence, the indemnification obligations of each of
Seller and Purchaser hereunder will survive, including surviving the sale or
other transfer by any party of any assets or businesses or the assignment by any
party of any Liabilities. The obligations of each Party to indemnify, defend and
hold harmless Indemnified Parties (i) pursuant to Sections 8.1(i) and 8.2(i),
shall terminate when the applicable representation or warranty expires pursuant
to Section 11.4 and (ii) pursuant to Sections 8.1(ii) and 8.2(ii) shall
terminate upon the expiration of all applicable statutes of limitation (giving
effect to any extensions thereof, other than extensions caused by the applicable
Indemnified Party); PROVIDED, HOWEVER, that as to clauses (i) and (ii) above,
such obligations to indemnify, defend and hold harmless shall not terminate with
respect to any individual claim as to which the Indemnified Party shall have,
before the expiration of the applicable period, previously delivered a notice
(stating in reasonable detail the basis of such claim) to the Indemnifying
Party.

            Section 8.7. EFFECT OF INVESTIGATION. The right to indemnification
pursuant to Sections 8.1(i) and 8.2(i) shall not be affected by any
investigation conducted with respect to, or any knowledge acquired (or capable
of being acquired) at any time, whether before or after the execution and
delivery of this Agreement.

                                   ARTICLE IX

                                      TAXES

            Section 9.1. TRANSFER, SALES AND USE TAXES. Notwithstanding anything
to the contrary in this Agreement, all transfer, documentary, sales, use, stamp,
registration, value added and other similar Taxes and fees (including any
penalties and interest) incurred in connection with the transactions
contemplated by this Agreement shall be shared equally by Seller and Purchaser.
Each Party hereto agrees to file all necessary documentation (including all Tax
Returns) with respect to all such Taxes in a timely manner. On or before the
Closing Date, Purchaser shall provide to Seller a required sales and use tax
purchase exemption certificate or certificates with respect to the Assets to the
extent they constitute (i) exempt tangible personal property held for resale or
for incorporation into goods to be held for resale, (ii) exempt manufacturing
and production equipment, or (iii) otherwise are exempt from the sales and use
tax upon the provision of an appropriate exemption certificate.

            Section 9.2. TAX RETURNS. Seller shall prepare and file or cause to
be prepared and filed all Tax Returns (including amendments thereto) which are
required to be filed in respect of the Assets for any taxable period ending on
or before the Closing Date and any taxable period that includes (but does not
end on) the Closing Date (a

                                       28

<PAGE>


"Straddle Period"). Purchaser hereby irrevocably designates, and agrees to cause
each of its Affiliates to designate Seller as its agent to take any and all
actions necessary or incidental to the preparation and filing of such Tax
Returns. All Tax Returns (including amendments thereto) required to be filed in
respect of the Assets for taxable periods beginning after the Closing Date shall
be the responsibility of Purchaser.

            Section 9.3. PRORATIONS. Purchaser and Seller agree that Taxes with
respect to the Assets shall be prorated as of the Closing Date, with Seller
liable to the extent such Taxes relate to any time period on or before the
Closing Date, and Purchaser liable to the extent such Taxes relate to periods
commencing after the Closing Date.

            Section 9.4. ALLOCATION OF STRADDLE PERIOD TAXES. In the case of any
Straddle Period:

            (a)   PERIODIC TAXES. (i) The periodic Taxes with respect to the
Assets that are not based on income or receipts (E.G., property Taxes) for the
portion of any Straddle Period which ends on the Closing Date shall be computed
based on the ratio of the number of days in such portion of the Straddle Period
and the number of days in the entire taxable period, and (ii) the periodic taxes
with respect to the Assets that are not based on income or receipts for the
portion of any Straddle Period beginning on the day after the Closing Date shall
be computed based on the ratio of the number of days in such portion of the
Straddle Period and the number of days in the entire taxable period.

            (b)   NON-PERIODIC TAXES. (i) The Taxes with respect to the Assets
for that portion of any Straddle Period ending on the Closing Date (other than
Taxes described in Section 9.4(a) above), shall be computed on a
"closing-of-the-books" basis as if such taxable period ended as of the close of
business on the Closing Date, and (ii) the Taxes with respect to the Assets for
that portion of any Straddle Period beginning after the Closing Date (other than
Taxes described in Section 9.4(a) above), shall be computed on a
"closing-of-the-books" basis as if such taxable period began on the day after
the Closing Date.

                                   ARTICLE X

                                   TERMINATION


            Section 10.1. VOLUNTARY TERMINATION. This Agreement may be
terminated and the transactions contemplated hereby may be abandoned at any time
prior to the Closing Date by the mutual written consent of Purchaser and Seller.


                                       29

<PAGE>


            Section 10.2. AUTOMATIC TERMINATION. In the event of a termination
of the Merger Agreement, this Agreement shall automatically and immediately
terminate.

            Section 10.3. EFFECT OF TERMINATION. In the event of the termination
of this Agreement, all further obligations of the Parties hereunder shall
terminate, and the transactions contemplated hereby shall be abandoned without
further action or liability by any of the Parties hereto, except that (i)
Section 10.3 ("Effect of Termination"), Section 11.2 ("Notices"), Section 11.3
("Choice of Law, Dispute Resolution"), Section 11.6 ("Entire Agreement;
Waivers"), Section 11.8 ("Severability"), Section 11.10 ("Expenses") and Section
11.12 ("Parties in Interest") shall survive such termination and (ii) nothing
shall relieve any Party hereto from liability for any breach of this Agreement
prior to such termination.

                                   ARTICLE XI

                                  MISCELLANEOUS

            Section 11.1. ASSIGNMENT. No Party to this Agreement will convey,
assign or otherwise transfer any of its rights or obligations under this
Agreement without the prior written consent of the other Party in its sole and
absolute discretion. Notwithstanding the foregoing, any Party may (without
obtaining any consent) assign, delegate or sublicense all or any portion of its
rights and obligations hereunder to (i) the surviving entity resulting from a
merger or consolidation involving such Party, (ii) the acquiring entity in a
sale or other disposition of (A) all or substantially all of the assets of such
Party as a whole or (B) any line of business or division of such Party, (iii)
any other Person that is created as a result of a spin-off from, or similar
reorganization transaction of, such Party or any line of business or division of
such Party, (iv) in the case of Purchaser, to Maquiladora or (v) an Affiliate.
In the event of an assignment pursuant to (ii) or (iii) above, the non-assigning
Party shall, at the assigning Party's request, use good faith commercially
reasonable efforts to enter into separate agreements with each of the resulting
entities and take such further actions as may be reasonably required to assure
that the rights and obligations under this Agreement are preserved, in the
aggregate, and divided equitably between such resulting entities. Any
conveyance, assignment or transfer requiring the prior written consent of
another Party pursuant to this Section 11.1 which is made without such consent
will be void ab initio. No assignment of this Agreement will relieve the
assigning Party of its obligations hereunder.

            Section 11.2. NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed duly given (a) on the date of
delivery if delivered personally, (b) upon confirmation of receipt if delivered
by telecopy or telefacsimile, (c) on the first Business Day following the date
of dispatch if delivered by a recognized

                                       30

<PAGE>

next-day courier service, or (d) on the fifth Business Day following the date of
mailing if delivered by registered or certified mail, return receipt requested,
postage prepaid. All notices hereunder shall be delivered as set forth below, or
pursuant to such other instructions as may be designated in writing by the Party
to receive such notice:

        If to Purchaser, to:

            Alpha Industries, Inc.
            20 Sylvan Road
            Woburn, MA  01801
            Fax:         (617) 824-4426
            Attention:   Paul E. Vincent
                         Chief Financial Officer

            With copies to (not effective for purposes of notice):

            Alpha Industries, Inc.
            20 Sylvan Road
            Woburn, MA  01801
            Fax:         (617) 824-4564
            Attention:   James K. Jacobs, Esq.
                         General Counsel

        or if to Seller, to:

            Conexant Systems, Inc.
            4311 Jamboree Road
            Newport Beach, California  92660-3095
            Fax:         (949) 483-6388
            Attention:   Dennis E. O'Reilly
                         Senior Vice President, General
                         Counsel and Secretary

            With a copy to (not effective for purposes of notice):

            Chadbourne & Parke LLP
            30 Rockefeller Plaza
            New York, New York 10112
            Fax:         (212) 541-5369
            Attention:   Peter R. Kolyer, Esq.

                                       31

<PAGE>


      Section 11.3. CHOICE OF LAW; DISPUTE RESOLUTION.

      (a) CHOICE OF LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware (without giving effect to
choice of law principles).

      (b) DISPUTE RESOLUTION. In the event that from and after the Closing, any
dispute, claim or controversy (collectively, a "Dispute") arises out of or
relates to any provision of this Agreement or the breach, performance,
enforcement or validity or invalidity thereof, the designees of Seller's Chief
Executive Officer and Purchaser's Chief Executive Officer will attempt a good
faith resolution of the Dispute within thirty (30) days after either Party
notifies the other Party in writing of the Dispute. If the Dispute is not
resolved within thirty (30) days of the receipt of the notification, or within
such other time as they may agree, the Dispute will be referred for resolution
to Seller's Chief Executive Officer and Purchaser's Chief Executive Officer.
Should they be unable to resolve the Dispute within thirty (30) days following
the referral to them, or within such other time as they may agree, Seller and
Purchaser will then attempt in good faith to resolve such Dispute by mediation
in accordance with the then-existing CPR Mediation Procedures promulgated by the
CPR Institute for Dispute Resolution, New York City. If such mediation is
unsuccessful within thirty (30) days (or such other period as the Parties may
mutually agree) after the commencement thereof, such Dispute shall be submitted
by the Parties to binding arbitration, initiated and conducted in accordance
with the then-existing American Arbitration Association Commercial Arbitration
Rules, before a single arbitrator selected jointly by Seller and Purchaser, who
shall not be the same person as the mediator appointed pursuant to the preceding
sentence. If Seller and Purchaser cannot agree upon the identity of an
arbitrator within ten (10) days after the arbitration process is initiated, then
the arbitration will be conducted before three arbitrators, one selected by
Seller, one selected by Purchaser and the third selected by the first two. The
arbitration shall be conducted in San Francisco, California and shall be
governed by the United States Arbitration Act, 9 U.S.C. Sections 1-16, and
judgment upon the award may be entered by any court having jurisdiction thereof.
The arbitrators shall have case management authority and shall resolve the
Dispute in a final award within one hundred eighty (180) days from the
commencement of the arbitration action, subject to any extension of time thereof
allowed by the arbitrators upon good cause shown.

      Section 11.4. SURVIVAL OF REPRESENTATIONS AND WARRANTIES AND COVENANTS.
The respective representations and warranties of the Parties contained in this
Agreement (other than those set forth in the following sentence) will survive
the execution and delivery of this Agreement, the consummation of the
transactions contemplated hereby and the Closing and will continue in full force
and effect until six (6) months after the Closing Date and will then expire. The
representations and warranties of the Parties


                                       32

<PAGE>

contained in Section 3.1, Section 3.2, Section 3.3, Section 3.9, Section 3.11,
Section 4.1, Section 4.2, and Section 4.3 will survive the execution and
delivery of this Agreement, the consummation of the transactions contemplated
hereby and the Closing and will continue in full force and effect until all
applicable statutes of limitation (including any extensions thereof) have
expired and will then expire. All covenants of the Parties contained in this
Agreement will remain in full force and effect after, and survive, the Closing
(other than those to be performed at or prior to the Closing).

            Section 11.5. LIMITATIONS ON REPRESENTATIONS AND WARRANTIES. Except
for the representations and warranties set forth in this Agreement, the Assets
are being sold "AS IS, WHERE IS, AND WITH ALL FAULTS." EXCEPT FOR THE
REPRESENTATIONS AND WARRANTIES SET FORTH IN THIS AGREEMENT, SELLER MAKES NO
REPRESENTATIONS OR WARRANTIES WHATSOEVER CONCERNING THE ASSUMED LIABILITIES, THE
ASSETS, OR ANY OTHER MATTER, EXPRESS OR IMPLIED, ORAL, OR WRITTEN. SELLER HEREBY
SPECIFICALLY DISCLAIMS THE IMPLIED WARRANTY OF MERCHANTABILITY AND THE IMPLIED
WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE.

            Section 11.6. ENTIRE AGREEMENT; WAIVERS. This Agreement, together
with all exhibits and Schedules hereto, and the other agreements and instruments
of the Parties delivered in connection herewith constitute the entire agreement
and supersede all prior agreements and understandings both written and oral,
among the Parties with respect to the subject matter hereof. The failure of any
Party to this Agreement to assert any of its rights under this Agreement or
otherwise shall not constitute a waiver of those rights.

            Section 11.7. COUNTERPARTS. This Agreement may be executed in
separate counterparts, each such counterpart being deemed to be an original
instrument, and all such counterparts will together constitute the same
agreement. This Agreement may be executed and delivered by telecopier with the
same force and effect as if it were a manually executed and delivered
counterpart.

            Section 11.8. SEVERABILITY. If any provision of this Agreement or
the application thereof to any Person or circumstance is determined by a court
of competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances other than those as to which it has been held invalid or
unenforceable, will remain in full force and effect and will in no way be
affected, impaired or invalidated thereby. If the economic or legal substance of
the transactions contemplated hereby is affected in any manner adverse to any
Party as a result thereof, the Parties will negotiate in good faith in an effort
to agree upon a suitable and equitable substitute provision to effect the
original intent of the Parties.


                                       33

<PAGE>


            Section 11.9. HEADINGS. The headings of the Articles and Sections
herein are inserted for convenience of reference only and are not intended to be
a part of or to affect the meaning or interpretation of this Agreement.

            Section 11.10. EXPENSES. Except as otherwise provided in this
Agreement, each of the Parties shall be liable for its own expenses incurred in
connection with the negotiation, preparation, execution and performance of this
Agreement prior to Closing.

            Section 11.11. AMENDMENTS. This Agreement cannot be amended,
modified or supplemented except by a written agreement executed by Seller and
Purchaser.

            Section 11.12. PARTIES IN INTEREST. This Agreement is binding upon
and is for the benefit of the Parties hereto and their respective successors and
permitted assigns. This Agreement is not made for the benefit of any Person not
a Party hereto, and no Person other than the Parties hereto or their respective
successors and permitted assigns will acquire or have any benefit, right, remedy
or claim under or by reason of this Agreement, except that the provisions of
Sections 8.1 and 8.2 hereof shall inure to the benefit of the Persons referred
to therein.

            Section 11.13. SCHEDULES AND EXHIBITS. Inclusion of an item or
matter on any of the Schedules or Exhibits attached hereto shall not be deemed
to be an admission by any Party that such item or matter is required to be
disclosed in such Schedule or Exhibit. Each disclosure on each Schedule, to the
extent specified therein, qualifies the correspondingly numbered representation
and warranty or covenant contained herein and, to the extent it is apparent on
the face of such disclosure that such disclosure qualifies another
representation or warranty contained herein, such other representation and
warranty.

            Section 11.14. COOPERATION FOLLOWING THE CLOSING. Following the
Closing, the Parties shall each deliver to the other such further information
and documents and shall execute and deliver to the other such further
instruments and agreements as the other shall reasonably request to consummate
or confirm the transactions provided for in this Agreement, to accomplish the
purpose of this Agreement or to assure to the other the benefits of this
Agreement.


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                                       34

<PAGE>


      IN WITNESS WHEREOF, each of the Parties listed below has executed this
U.S. Asset Purchase Agreement as of the day and year first above written.



                                 CONEXANT SYSTEMS, INC.


                                 By:   /s/ Dwight W. Decker
                                       ---------------------------------------
                                       Dwight W. Decker
                                       Chairman of the Board and Chief
                                         Executive Officer


                                 ALPHA INDUSTRIES, INC.


                                 By:   /s/ David J. Aldrich
                                       ---------------------------------------
                                       David J. Aldrich
                                       President and Chief Executive Officer



                                       35


<PAGE>



                                AMENDMENT TO THE
                          U.S. ASSET PURCHASE AGREEMENT

                  AMENDMENT NO. 1 TO THE U.S. ASSET PURCHASE AGREEMENT, dated as
of June 25, 2002 (this "Amendment"), to the U.S. Asset Purchase Agreement, dated
as of December 16, 2001, by and between CONEXANT SYSTEMS, INC. ("Seller") and
ALPHA INDUSTRIES, INC. ("Purchaser") (as amended, modified or supplemented from
time to time, the "U.S. Asset Purchase Agreement").

                              W I T N E S S E T H :

                  WHEREAS, Seller and Purchaser wish to amend the U.S. Asset
Purchase Agreement as set forth herein;

                  NOW THEREFORE, the parties hereto agree as follows:

                  SECTION 1. Definitions. Capitalized terms used herein and not
defined herein have the meanings ascribed to them in the U.S. Asset Purchase
Agreement.

                  SECTION 2. Conditions to Effectiveness of this Amendment. This
Amendment shall become effective on June 25, 2002 (the "Amendment Effective
Date").

                  SECTION 3. Amendment to the U.S. Asset Purchase Agreement.

                  (a)      Article I is hereby amended by deleting in its
                           entirety the definition of "Mexican Stock and Asset
                           Purchase Agreement" and inserting in lieu thereof the
                           following:

                           "Mexican Asset Purchase Agreement" means that certain
                           Amended and Restated Mexican Asset Purchase
                           Agreement, dated as of June 25, 2002, by and between
                           Seller and Purchaser, as the same may be amended,
                           modified or supplemented from time to time.

                           "Mexican Stock and Asset Purchase Agreement" means
                           the Mexican Stock Purchase Agreement and the Mexican
                           Asset Purchase Agreement, individually and
                           collectively.

                           "Mexican Stock Purchase Agreement" means that certain
                           Mexican Stock Purchase Agreement, dated as of June
                           25, 2002, by and
<PAGE>
                           between Seller and Purchaser, as the same may be
                           amended, modified or supplemented from time to time.

                  (b)      Article I is hereby amended by deleting in its
                           entirety the definition of "Purchase Price" and
                           inserting in lieu thereof the following:

                           "Purchase Price" means fifty million eight hundred
                           ninety thousand dollars (U.S.$50,890,000).


                        [No additional text on this page]


                                       2
<PAGE>
                  IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their respective officers thereunto duly authorized,
as of the date first above written.

                                    CONEXANT SYSTEMS, INC.,
                                      as Seller


                                    By: /s/ Dennis E. O'Reilly
                                        ---------------------------------------
                                         Name:   Dennis E. O'Reilly
                                         Title:  Senior Vice President, General
                                         Counsel and Secretary



                                    ALPHA INDUSTRIES, INC.,
                                      as Purchaser

                                    By: /s/ Paul E. Vincent
                                        ---------------------------------------
                                         Name:   Paul E. Vincent
                                         Title: Vice President,
                                         Chief Financial Officer,
                                         Treasurer and Secretary







</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-16.1
<SEQUENCE>7
<FILENAME>b43517ssexv16w1.txt
<DESCRIPTION>LETTER FROM DELOITTE & TOUCHE LLP TO THE SEC
<TEXT>
<PAGE>
                         [DELOITTE & TOUCHE LETTERHEAD]


June 27, 2002


Securities and Exchange Commission
Mail Stop 11-3
450 5th Street, N.W.
Washington, D.C.  20549

Dear Sir/Madam:

We have read and agree with the comments in Item 4 of Form 8-K of Skyworks
Solutions, Inc. dated June 25, 2002, with the exception of the statements made
in the first two sentences of the fourth paragraph, as to which we have no basis
to agree or disagree.

Yours truly,

/s/ Deloitte & Touche LLP

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>8
<FILENAME>b43517ssexv99w1.txt
<DESCRIPTION>FINANCING AGREEMENT
<TEXT>
<PAGE>


                                                                    EXHIBIT 99.1





                               FINANCING AGREEMENT


                                      among



                             ALPHA INDUSTRIES, INC.,


                                   CERTAIN OF
                                ITS SUBSIDIARIES


                                       and


                             CONEXANT SYSTEMS, INC.
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                        Page
<S>                                                                                                    <C>
SECTION 1        DEFINED TERMS; RULES OF CONSTRUCTION...............................................     1
         1.1.    Defined Terms......................................................................     1
         1.2.    Rules of Construction..............................................................     1

SECTION 2        FINANCING..........................................................................     1
         2.1.    Revolving Credit Facility..........................................................     1
         2.2.    Acquisition Notes..................................................................     6
         2.3.    Financing Documents................................................................     8
         2.4.    Note Exchange......................................................................    10
         2.5.    Payments and Prepayments...........................................................    13

SECTION 3        GUARANTIES.........................................................................    13
         3.1.    Alpha Guaranty.....................................................................    13
         3.2.    Alpha Subsidiary Guaranty..........................................................    13
         3.3.    Expenses...........................................................................    15
         3.4.    Guaranty of Payment................................................................    15
         3.5.    Unconditional Guaranty.............................................................    15
         3.6.    Independent Obligations............................................................    16
         3.7.    Waiver of Notices..................................................................    16
         3.8.    No Release of Guaranty.............................................................    16
         3.9.    Subordination and Subrogation......................................................    17
         3.10.   Certain Actions Waived.............................................................    18
         3.11.   California Real Property Waivers...................................................    18
         3.12.   Reinstatement......................................................................    19

SECTION 4        SECURITY INTERESTS.................................................................    20
         4.1.    Grant of Security Interest.........................................................    20
         4.2.    Filings............................................................................    20
         4.3.    Power of Attorney..................................................................    20
         4.4.    Delivery of Collateral.............................................................    21
         4.5.    Further Actions....................................................................    21
         4.6.    No Assumption of Liability.........................................................    21
         4.7.    Change of Name or Jurisdiction.....................................................    22
         4.8.    Collateral Records.................................................................    22
         4.9.    Inspection and Verification........................................................    22
         4.10.   Taxes; Liens.......................................................................    22
         4.11.   Protection of Security.............................................................    23
</TABLE>
<PAGE>
<TABLE>
<S>                                                                                                    <C>
         4.12.   Use and Disposition of Collateral..................................................    23
         4.13.   Limitation of Modification of Receivables..........................................    23
         4.14.   Covenants Regarding Patents, Trademarks and Copyrights.............................    24
         4.15.   Covenants Regarding Pledged Securities.............................................    25
         4.16.   Covenants Regarding Insurance......................................................    28

SECTION 5        REPRESENTATIONS AND WARRANTIES.....................................................    29
         5.1.    General Representations and Warranties.............................................    30
         5.2.    Representations and Warranties Concerning Collateral...............................    32
         5.3.    Scope of Certain Representations and Warranties....................................    35

SECTION 6        REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT.......................................    36
         6.1.    Remedies; Obtaining the Collateral Upon Default....................................    36
         6.2.    Remedies; Disposition of the Collateral............................................    37

SECTION 7        COVENANTS..........................................................................    43
         7.1.    Payment of Obligations.............................................................    43
         7.2.    Maintenance of Property............................................................    43
         7.3.    Conduct of Business and Maintenance of Existence...................................    43
         7.4.    Compliance with Laws...............................................................    43
         7.5.    Inspection of Property, Books and Records..........................................    43
         7.6.    Investments........................................................................    44
         7.7.    Fundamental Changes................................................................    44
         7.8.    Sales of Assets....................................................................    44
         7.9.    Negative Pledge....................................................................    46
         7.10.   Restricted Payments................................................................    46
         7.11.   Transactions with Affiliates.......................................................    46
         7.12.   Indebtedness.......................................................................    47
         7.13.   Notice of Default; Other Notices...................................................    48
         7.14.   Financial Reporting................................................................    48
         7.15.   Payment of Taxes...................................................................    49
         7.16.   Capital Expenditures...............................................................    49
         7.17.   Minimum Cash Balance...............................................................    49
         7.18.   Excluded Subsidiaries; Restricted Subsidiaries.....................................    50

SECTION 8        INDEMNITY..........................................................................    50
         8.1.    Indemnity..........................................................................    50
         8.2.    Expense Reimbursement..............................................................    52
         8.3.    Indemnity Obligations Secured by Collateral........................................    52
         8.4.    Survival...........................................................................    52
</TABLE>

                                       ii
<PAGE>
<TABLE>
<S>                                                                                                    <C>
SECTION 9        MISCELLANEOUS......................................................................    52
         9.1.    Notices............................................................................    52
         9.2.    Waiver; Amendment..................................................................    54
         9.3.    Obligations Absolute...............................................................    54
         9.4.    Successors and Assigns.............................................................    54
         9.5.    Governing Law......................................................................    54
         9.6.    Termination; Release...............................................................    54
         9.7.    Counterparts.......................................................................    55
         9.8.    Severability.......................................................................    55
         9.9.    Jurisdiction; Consent to Service of Process........................................    55
         9.10.   Waiver of Jury Trial...............................................................    56
         9.11.   Additional Subsidiary Obligors.....................................................    56
         9.12.   Confidentiality....................................................................    56
         9.13.   Entire Agreement...................................................................    57
         9.14.   No Third Party Beneficiaries.......................................................    57
         9.15.   Withholding Taxes..................................................................    57
         9.16.   Foreign Subsidiaries...............................................................    58
</TABLE>

                                      iii
<PAGE>
                               FINANCING AGREEMENT


         AGREEMENT dated as of June 25, 2002 among Conexant Systems, Inc., a
Delaware corporation ("CONEXANT"), Alpha Industries, Inc., a Delaware
corporation ("ALPHA"), and each of the subsidiaries of Alpha that are or are to
become a party to this Agreement (the "ALPHA SUBSIDIARIES").

                                   SECTION 1

                      DEFINED TERMS; RULES OF CONSTRUCTION


1.1. DEFINED TERMS. In this Agreement, terms defined in Exhibit A shall have the
meanings set forth therein, terms defined in the preamble, preliminary
statements or other sections of this Agreement shall have the meanings set forth
therein, terms defined in the UCC and not otherwise defined in this Agreement
shall have the meanings set forth in the UCC, and capitalized terms used but not
otherwise defined in this Agreement which are defined in the Purchase Documents
shall have the meanings set forth in the Purchase Documents.

1.2. RULES OF CONSTRUCTION. The rules of construction set forth in Exhibit A
shall apply to this Agreement.

                                   SECTION 2

                                    FINANCING


2.1. REVOLVING CREDIT FACILITY.

         2.1.1. REVOLVING CREDIT COMMITMENT.

                  2.1.1.1. COMMITMENT TO LEND. During the Availability Period,
                  Conexant agrees, subject to the terms and conditions set forth
                  in this Agreement, to make Revolving Loans to Alpha from time
                  to time in amounts such that the aggregate principal amount of
                  all Revolving Loans then outstanding does not exceed the
                  Commitment.

                  2.1.1.2. COMMITMENT AMOUNT. The Commitment shall be
                  $100,000,000, less the Reserve, if any, subject to reduction
                  and termination as provided in Section 2.1.1.3.
<PAGE>
                  2.1.1.3. COMMITMENT TERMINATION AND REDUCTION. Alpha may at
                  any time during the Availability Period, upon at least two
                  Business Days' notice to Conexant, (i) terminate the
                  Commitment at any time when no Revolving Loans are
                  outstanding, and (ii) reduce from time to time the amount of
                  the Commitments in excess of the then outstanding aggregate
                  principal amount of Revolving Loans then outstanding. The
                  Commitment shall terminate on the Expiration Date. Conexant
                  may at any time when an Event of Default has occurred and is
                  continuing terminate the Commitment in whole or in part as
                  provided in Section 2.1.5.6. The Commitment shall terminate,
                  automatically and without notice or other action to or by any
                  person, upon the occurrence of any Bankruptcy Event. The
                  Commitment shall be reduced, automatically and without notice
                  or other action to or by any person, by an amount equal to the
                  product of (x) 1 1/3 and (y) the aggregate amount of any
                  prepayment of Revolving Loans required to be made pursuant to
                  Sections 2.1.5.4 and 2.1.5.5; provided that if the product of
                  (x) and (y) would result in a Commitment of less than the
                  outstanding principal amount of the Revolving Loans, after
                  giving effect to any prepayment required to be made pursuant
                  to Sections 2.1.5.4 and 2.1.5.5, then the Commitment shall be
                  equal to the then outstanding principal amount of the
                  Revolving Loans, after giving effect to any such prepayment.

         2.1.2. REVOLVING LOANS. Within the limits set forth in Section 2.1.1,
         Alpha may borrow, repay, prepay and reborrow at any time during the
         Availability Period.

         2.1.3. BORROWING PROCEDURE. Alpha may borrow by giving Conexant a
         Notice of Borrowing not later than 10:30 a.m. (Pacific time) on the
         third Business Day before each Revolving Loan. Each Notice of Borrowing
         shall specify (i) the date of the borrowing, which must be a Business
         Day and (ii) the aggregate amount of the borrowing and must be signed
         on behalf of Alpha by its chief executive officer or chief financial
         officer. Each borrowing must be in an aggregate principal amount of
         $5,000,000 (or any larger multiple of $1,000,000). Not later than 11:00
         a.m. (Pacific time) on the date of each borrowing, Conexant will make
         available to Alpha the amount requested in the applicable Notice of
         Borrowing by transferring such amount, in immediately available funds,
         to the Borrower Account.

         2.1.4. INTEREST.

                  2.1.4.1. INTEREST RATE. Each Revolving Loan shall bear
                  interest on the outstanding principal amount thereof, for each
                  day it is outstanding, at a rate per annum equal to the
                  Applicable Rate for the Revolving Loans.

                                       2
<PAGE>
                  2.1.4.2. DEFAULT RATE. If any Event of Default has occurred
                  and is continuing, each Revolving Loan shall bear interest on
                  the outstanding amount thereof, for each day it is
                  outstanding, at a rate per annum equal to the Applicable Rate
                  for Revolving Loans plus 2%.

                  2.1.4.3. INTEREST PAYMENTS. Interest on Revolving Loans shall
                  be paid monthly in arrears on the last Business Day of each
                  month and on the Expiration Date.

                  2.1.4.4. INTEREST COMPUTATION. All interest hereunder shall be
                  computed on the basis of a year of 360 days and paid for the
                  actual number of days elapsed (including the first day but
                  excluding the last day).

         2.1.5. REPAYMENT OF REVOLVING LOANS.

                  2.1.5.1. EXPIRATION DATE. Alpha hereby unconditionally
                  promises that on the Expiration Date, Alpha shall repay the
                  unpaid principal amount of each Revolving Loan then
                  outstanding, together with all accrued and unpaid interest on
                  such principal amount to the date of payment.

                  2.1.5.2. OPTIONAL PREPAYMENT. Alpha may, at any time and from
                  time to time, upon three (3) days' prior written notice to
                  Conexant, prepay any Revolving Loans, in whole or in part,
                  together with interest on the amount prepaid to the date of
                  prepayment, without penalty or premium. Once Alpha has given
                  notice of a prepayment hereunder, Alpha shall be obligated to
                  make such prepayment.

                  2.1.5.3. MANDATORY PREPAYMENT; COMMITMENT AMOUNT. In addition
                  to any other mandatory prepayments or commitment reductions
                  required pursuant to this Agreement, Alpha shall,
                  automatically and without notice or other action to or by any
                  person, prepay Loans at such times and in such amounts as
                  shall be required to assure that the aggregate principal
                  amount of all Revolving Loans then outstanding does not at any
                  time exceed the Commitment as then in effect. In the event of
                  any termination of the Commitment, Alpha shall prepay all
                  Revolving Loans then outstanding on the date of such
                  termination, together with all accrued and unpaid interest to
                  the date of payment.

                  2.1.5.4. MANDATORY PREPAYMENTS; RELEVANT TRANSACTIONS. In
                  addition to any other mandatory prepayments or commitment
                  reductions required pursuant to this Agreement, not later than
                  one Business Day after Alpha receives any Net Cash Proceeds
                  from any Relevant Transaction, Alpha shall apply all of the
                  Net Cash Proceeds of such Relevant Transaction as

                                       3
<PAGE>
                  follows: (a) first to prepay principal of the Acquisition
                  Notes, pro rata in proportion to the principal amounts of the
                  Acquisition Notes outstanding immediately prior to any such
                  prepayment, any such prepayment to be applied first to reduce
                  the amount of any prepayment required by Section 2.2.2.4 and
                  second to reduce the amount payable on the Maturity Date of
                  the Acquisition Notes and (b) second to prepay Revolving Loans
                  then outstanding (whereupon the Commitment shall be reduced as
                  provided in Section 2.1.1.3). Notwithstanding the foregoing,
                  Alpha may retain that portion of the Net Cash Proceeds of such
                  Relevant Transaction as may be required to assure that the
                  amount of Available Cash is not less than $60,000,000;
                  provided that nothing herein shall permit Alpha to retain any
                  amount of Available Cash in excess of $60,000,000 after the
                  Excess Cash Payment Date immediately following the receipt of
                  such Net Cash Proceeds.

                  2.1.5.5. MANDATORY PREPAYMENTS; EXCESS CASH. In addition to
                  any other mandatory prepayments or commitment reductions
                  required pursuant to this Agreement, on each Excess Cash
                  Payment Date following July 31, 2002, Alpha shall apply an
                  amount equal to all Excess Cash as follows: (a) first to
                  prepay principal of the Acquisition Notes, pro rata in
                  proportion to the principal amounts of the Acquisition Notes
                  outstanding immediately prior to any such prepayment, any such
                  prepayment to be applied first to reduce the amount of any
                  prepayment required by Section 2.2.2.4 and second to reduce
                  the amount payable on the Maturity Date of the Acquisition
                  Notes and (b) second to prepay Revolving Loans then
                  outstanding (whereupon the Commitment shall be reduced as
                  provided in Section 2.1.1.3).

                  2.1.5.6. EVENT OF DEFAULT. If any Event of Default has
                  occurred, at any time thereafter during the continuance of
                  such Event of Default, Conexant may, by notice to Alpha, take
                  either or both of the following actions (in addition to
                  exercising any other rights or remedies it may have under this
                  Agreement, applicable law or otherwise):

                  (i) terminate the Commitment; and

                  (ii) declare the Revolving Loans then outstanding to be due
                  and payable, in whole or in part, whereupon the principal of
                  the Revolving Loans, together with accrued interest thereon
                  and all other liabilities under this Agreement or any other
                  Financing Document, shall become forthwith due and payable,
                  without presentment, demand, protest or any other notice of
                  any kind, all of which are hereby expressly waived by Alpha
                  and each of

                                       4
<PAGE>
                  the other Obligors, anything contained in this Agreement or
                  the other Financing Documents to the contrary notwithstanding.

                  If any Bankruptcy Event occurs, the Commitments shall
                  automatically terminate and the principal of the Revolving
                  Loans, together with accrued interest thereon and all other
                  liabilities under this Agreement or any other Financing
                  Document, shall become forthwith due and payable, without
                  presentment, demand, protest or any other notice of any kind,
                  all of which are hereby expressly waived by Alpha and each of
                  the other Obligors, anything contained in this Agreement or
                  the other Financing Documents to the contrary notwithstanding.

         2.1.6. EVIDENCE OF REVOLVING LOANS. Conexant shall maintain accounts
         and records in which it shall record for each Revolving Loan made by it
         hereunder:

                  2.1.6.1. the amount and the borrowing date of such Revolving
                  Loan;

                  2.1.6.2. the amount of any principal paid, pre-paid and repaid
                  for such Revolving Loan;

                  2.1.6.3. the amount of any interest payable and paid for such
                  Revolving Loan; and

                  2.1.6.4. the amount of any other sum paid by Alpha under this
                  Agreement.

         The entries made in such accounts shall be prima facie evidence of the
         existence and amounts of the obligations therein recorded. Conexant may
         request that its Revolving Loans be evidenced by a promissory note. In
         such event, Alpha shall execute and deliver to Conexant a promissory
         note payable to the order of Conexant substantially in the form annexed
         as Exhibit B-1.

         2.1.7. USE OF PROCEEDS. All proceeds of the Revolving Loans shall be
         used solely for (i) the working capital, Capital Expenditures (to the
         extent permitted by Section 7.16) and general corporate purposes of
         Alpha and its Subsidiaries (subject to the restrictions herein with
         respect to Excluded Subsidiaries and Restricted Subsidiaries) and (ii)
         to pay expenses incurred by Alpha and its Subsidiaries in connection
         with the Spin-off, the Merger, the Purchase Documents and the Financing
         Documents. No part of the proceeds shall be used (i) to purchase or
         carry any Margin Stock or to extend credit for purpose of purchasing or
         carrying any Margin Stock, or (ii) to make Investments, other than
         Permitted Investments, or (iii) make any Restricted Payments.


                                       5
<PAGE>
2.2.     ACQUISITION NOTES.

         2.2.1. INTEREST.

                  2.2.1.1. INTEREST RATE. Each Acquisition Note shall bear
                  interest on the outstanding principal amount thereof, for each
                  day it is outstanding, at a rate per annum equal to the
                  Applicable Rate for the Acquisition Notes.

                  2.2.1.2. DEFAULT RATE. If any Event of Default has occurred
                  and is continuing, each Acquisition Note shall bear interest
                  on the outstanding amount thereof, for each day it is
                  outstanding, at a rate per annum equal to the Applicable Rate
                  for Acquisition Notes plus 2%.

                  2.2.1.3. INTEREST PAYMENTS. Interest on Acquisition Notes
                  shall be paid quarterly in arrears on the last Business Day of
                  each June, September, December and March, commencing June 30,
                  2002 and on the Maturity Date.

                  2.2.1.4. INTEREST COMPUTATION. All interest hereunder shall be
                  computed on the basis of a year of 360 days and paid for the
                  actual number of days elapsed (including the first day but
                  excluding the last day).

         2.2.2. REPAYMENT OF ACQUISITION NOTES.

                  2.2.2.1. ALPHA NOTES MATURITY DATE. Alpha hereby
                  unconditionally promises that on the Maturity Date, Alpha
                  shall repay the unpaid principal amount of each Alpha Note
                  then outstanding, together with all accrued and unpaid
                  interest on such principal amount to the date of payment.

                  2.2.2.2. MEXICALI NOTE MATURITY DATE. Mexicali hereby
                  unconditionally promises that on the Maturity Date, Mexicali
                  shall repay the unpaid principal amount of each Mexicali Note
                  then outstanding, together with all accrued and unpaid
                  interest on such principal amount to the date of payment.

                  2.2.2.3. OPTIONAL PREPAYMENT. Alpha and Mexicali may, at any
                  time and from time to time, upon three (3) days' prior written
                  notice to Conexant, prepay any Acquisition Note, in whole or
                  in part, together with interest on the amount prepaid to the
                  date of prepayment, without penalty or premium. Once Alpha or
                  Mexicali has given notice of a prepayment of an Acquisition
                  Note hereunder, Alpha and Mexicali shall be obligated to make
                  such prepayment. Any such prepayment shall be applied first to
                  reduce the amount of any prepayment required by Section
                  2.2.2.4 and


                                       6
<PAGE>
                  second to reduce the amount payable on the Maturity Date of
                  such Acquisition Note.

                  2.2.2.4. MANDATORY PREPAYMENTS OF ACQUISITION NOTES. In
                  addition to any other mandatory prepayments required pursuant
                  to this Agreement, not later than the date that is 270
                  calendar days after the Closing Date, Alpha or Mexicali, as
                  applicable, shall pay the Acquisition Notes in the following
                  principal amounts, unless sooner paid as provided herein or in
                  the Acquisition Notes:

<TABLE>
<CAPTION>
      NOTE                                       AMOUNT OF PRINCIPAL PAYMENT
<S>                                              <C>
Stock Purchase Note                                  $ 9,555,000

U.S. Asset Purchase Note                             $25,445,000

Mexicali Note or Exchange Note                       $40,000,000

Total                                                $75,000,000
</TABLE>


                  2.2.2.5. FUNDING PREPAYMENTS. Prepayments of Acquisition Notes
                  made pursuant to this Section shall be made (1) by Alpha
                  directly in respect of the Alpha Notes and (2) by Alpha making
                  a contribution to the capital of Mexicali in an amount
                  sufficient to enable Mexicali to make any required prepayment
                  of the Mexicali Note, and causing Mexicali to make such
                  prepayment, as and when due.

                  2.2.2.6. EVENT OF DEFAULT. If any Event of Default has
                  occurred, at any time thereafter during the continuance of
                  such Event of Default, Conexant may, by notice to Alpha and
                  Mexicali (in addition to exercising any other rights or
                  remedies it may have under this Agreement, applicable law or
                  otherwise) declare the Acquisition Notes then outstanding to
                  be due and payable in whole or in part, whereupon the
                  principal of the Acquisition Notes, together with accrued
                  interest thereon and all other liabilities under this
                  Agreement or any other Financing Document, shall become
                  forthwith due and

                                       7
<PAGE>
                  payable, without presentment, demand, protest or any other
                  notice of any kind, all of which are hereby expressly waived
                  by Alpha, Mexicali and each of the other Obligors, anything
                  contained in this Agreement or the other Financing Documents
                  to the contrary notwithstanding. If any Bankruptcy Event
                  occurs, the principal of the Acquisition Notes, together with
                  accrued interest thereon and all other liabilities under this
                  Agreement or any other Financing Document, shall become
                  forthwith due and payable, without presentment, demand,
                  protest or any other notice of any kind, all of which are
                  hereby expressly waived by Alpha, Mexicali and each of the
                  other Obligors, anything contained in this Agreement or the
                  other Financing Documents to the contrary notwithstanding.

2.3. FINANCING DOCUMENTS. Subject to the terms and conditions in this Agreement,
on the Closing Date, Alpha shall deliver to Conexant the following in connection
with the financing for the acquisitions pursuant to the Purchase Documents:

         2.3.1. ALPHA NOTES. The Alpha Notes, dated the Closing Date, in the
         principal amounts set forth in Schedule 2.3.1, and duly executed and
         delivered by Alpha and guaranteed por aval by Mexicali.

         2.3.2. MEXICALI NOTE. The Mexicali Note, dated the Closing Date, in the
         principal amount set forth in Schedule 2.3.2, and duly executed and
         delivered by Mexicali and guaranteed por aval by Alpha.

         2.3.3. SECURITY DOCUMENTS. Each of the Security Documents, dated as of
         the Closing Date, and duly executed by each of the parties thereto.

         2.3.4. CLOSING CERTIFICATE. A Closing Certificate for each Obligor,
         dated the Closing Date, and duly executed by an executive officer of
         the Obligor, as appropriate, certifying as to the matters set forth
         therein.

         2.3.5. UCC FINANCING STATEMENTS. The UCC financing statements in proper
         form for filing and recording in the appropriate recording offices in
         all United States jurisdictions in which such filings are necessary or
         appropriate to perfect the security interest granted by this Agreement
         and the other U.S. Security Documents.

         2.3.6. MORTGAGE RECORDING. The U.S. Mortgages and the Mexican Mortgages
         in proper form for filing and recording in the appropriate recording
         offices in all United States and Mexican jurisdictions in which such
         filings are necessary or appropriate to perfect the Liens granted
         therein.

         2.3.7. FIANZA. The Fianza, dated the Closing Date, and duly executed by
         Mexicali.

         2.3.8. INSURANCE. In respect of each insurance policy covering Alpha
         and its Subsidiaries, a certificate of insurance describing the
         policies of insurance referred to in Section 4.16.

         2.3.9. PLEDGED SECURITIES. The following documents and instruments in
         respect of the Pledged Securities:


                                       8
<PAGE>
                  2.3.9.1. Certificates representing the Pledged Securities,
                  duly endorsed for transfer or accompanied by assignment forms
                  or powers endorsed in blank, except (a) as otherwise provided
                  below for the Foreign Subsidiaries organized under the laws of
                  Korea and Japan, the Pledged Securities of which shall be
                  endorsed as hereinafter provided, and (b) to the extent any of
                  the Pledged Securities of any Foreign Subsidiary are not
                  certificated, Alpha shall cause the pledge of the relevant
                  Pledged Securities to be effected in accordance with
                  applicable local laws governing the effective pledge of such
                  Pledged Securities, which may include, but not be limited to,
                  the registration or recording of Conexant as pledgee in the
                  share register or such other instrument evidencing the
                  ownership of such Pledged Securities, as described in more
                  detail hereinafter.

                  2.3.9.2. In respect of Conexant Systems Finland Oy
                  ("FINLAND"), a notice of the pledge of the Pledged Stock of
                  Finland, countersigned by Alpha and a director of Finland.

                  2.3.9.3. In respect of Conexant Wireless S.A.S. ("FRANCE"),
                  (a) evidence reasonably satisfactory to Conexant that the
                  pledge of shares of France has been registered in the special
                  account of the share register of France, (b) a Pledge of Share
                  Account Declaration for the pledge of the Pledged Securities
                  of France, duly executed by Alpha and (c) a Certificate of
                  Pledge of Account of Financial Instruments for the pledge of
                  the Pledged Securities of France, duly executed by France.

                  2.3.9.4. In respect of Mexicali, evidence reasonably
                  satisfactory to Conexant that the pledge of stock of Mexicali
                  has been duly recorded in the Mexicali Shareholders' and
                  Shares' Registry Books.

                  2.3.9.5. In respect of Conexant Systems Korea, Ltd. ("KOREA"),
                  (a) evidence reasonably satisfactory to Conexant that the
                  pledge of Pledged Securities of Korea has been registered in
                  the shareholders list of Korea, and (b) an endorsement on each
                  share certificate representing the Pledged Securities of Korea
                  in favor of Conexant as pledgee.

                  2.3.9.6. In respect of LeaderCo Japan KK ("JAPAN"), (a)
                  evidence reasonably satisfactory to Conexant that the pledge
                  of shares of Japan has been registered in the shareholders
                  list of Japan, and (b) a recordation of Conexant as a pledgee
                  on each share certificate representing Pledged Securities of
                  Japan.

                  2.3.9.7. In respect of LeaderCo UK Ltd. ("UK"), (a) evidence
                  reasonably satisfactory to Conexant that (i) Alpha has been
                  recorded as the owner of

                                       9
<PAGE>
                  all the outstanding share capital of UK in the register of
                  members of UK, and (b) the Share Mortgage in respect of all
                  the outstanding share capital of UK, in form reasonably
                  satisfactory to Conexant, duly executed as a deed by Alpha.

         2.3.10. PLEDGED INSTRUMENTS. Originals of each of the Instruments
         referred to in Schedule 5.2.1 (5), duly endorsed for transfer or
         accompanied by assignment forms or powers endorsed in blank.

         2.3.11. LEGAL OPINIONS. An opinion of counsel for Alpha and the Alpha
         Subsidiaries, dated the Closing Date, substantially in the form annexed
         as Exhibit J-1. An opinion of counsel for Trans-Tech, Inc., dated the
         Closing Date, substantially in the form annexed as Exhibit J-2.

         2.3.12. FEES AND EXPENSES. Evidence reasonably satisfactory to Conexant
         that Alpha has paid all transfer, UCC, Patent and Trademark Office,
         mortgage, notary, documentary, stamp or other filing or recording fees
         or taxes, and title insurance premiums incurred by Conexant in
         connection with the Financing Documents and establishing or perfecting
         the Liens provided in the Security Documents, as set forth in Schedule
         2.3.12.

         2.3.13. OTHER. Such other documents and instruments as Conexant may
         reasonably request to establish, perfect or enforce the Liens granted
         in this Agreement or the other Financing Documents or to protect and
         enforce any rights or remedies provided in this Agreement or the other
         Financing Documents.

2.4. NOTE EXCHANGE. Subject to the terms and conditions set forth in this
Section 2.4, Conexant shall have the right to exchange the Mexicali Note for the
Alpha Exchange Note (the "EXCHANGE RIGHT").

         2.4.1. The Exchange Right may be exercised (i) at any time after the
         date which is 45 calendar days following the Closing Date and before
         two (2) Business Days prior to the Maturity Date, and (ii) only (x) in
         connection with a Transfer permitted by Section 9.4 in respect of which
         Conexant can make the certification provided for in Section 2.4.2.3 (a)
         or (y) with Alpha's consent, and (iii) only once as to the entire
         Mexicali Note.

         2.4.2. To exercise the Exchange Right, Conexant must deliver to Alpha
         an Exchange Notice substantially in the form annexed as Exhibit F,
         appropriately completed in conformity herewith:

                  2.4.2.1. The Exchange Notice shall state the date on which the
                  Mexicali Note will be exchanged for the Alpha Exchange Note
                  (the "EXCHANGE

                                       10
<PAGE>
                  DATE"). The Exchange Date must be a Business Day which is not
                  less than two (2) Business Days after the date the Exchange
                  Notice is given by Conexant.

                  2.4.2.2. The Exchange Notice shall be signed by an executive
                  officer of Conexant and delivered to Alpha in accordance with
                  Section 9.1(a).

                  2.4.2.3. In the Exchange Notice, Conexant shall either (a)
                  certify that it has entered into a binding contract to sell,
                  assign, pledge, hypothecate, securitize, monetize, grant one
                  or more participations or sub-participations in, enter into
                  one or more swap agreements or other derivative transactions
                  in respect of or otherwise transfer ("TRANSFER") a portion or
                  all of its right, title or interest in, to or under the Alpha
                  Notes and the other Financing Documents or (b) request Alpha's
                  consent to the exercise of the Exchange Right.

                  2.4.2.4. Alpha shall promptly, and in any event within two (2)
                  Business Days, either grant or deny any request made by
                  Conexant pursuant to Section 2.4.2.3 (b).

         2.4.3. If the Exchange Right is exercised, on the Exchange Date the
         Mexicali Note and the Alpha Exchange Note shall be exchanged as
         follows:

                  2.4.3.1. Conexant shall deliver to Alpha, against receipt of
                  the Alpha Exchange Note as provided in Section 2.4.3.2, the
                  Mexicali Note, endorsed, without recourse, to Alpha. Such
                  transfer shall be made without representation or warranties of
                  any kind by Conexant except those set forth in Section
                  3-417(3) of the UCC. Conexant shall also deliver to Alpha
                  evidence reasonably satisfactory to Alpha that the Transfer
                  will be consummated promptly after the Exchange.

                  2.4.3.2. Alpha shall issue and deliver to Conexant, against
                  receipt of the Mexicali Note as provided in Section 2.4.3.1,
                  the Alpha Exchange Note, issued in a principal amount equal to
                  the outstanding principal amount of the Mexicali Note on the
                  Exchange Date, dated the Exchange Date, and signed on behalf
                  of Alpha by a duly authorized officer of Alpha.

         2.4.4. If the Exchange Right is exercised, Mexicali, Alpha and Conexant
         hereby agree that, effective immediately upon the consummation of the
         exchange pursuant to Section 2.4.3, the Mexicali Note shall either be:

                  2.4.4.1. contributed by Alpha to the capital of Mexicali, in
                  which case (1) Alpha shall, on the Exchange Date, deliver the
                  Mexicali Note to

                                       11
<PAGE>
                  Mexicali, endorsed by Alpha as "paid in full and canceled" and
                  (2) Mexicali shall deliver to Alpha (with a copy to Conexant)
                  an acknowledgment of such capital contributions; or

                  2.4.4.2. exchanged for cash and/or in cancellation of
                  inter-company indebtedness between Alpha and Mexicali and/or a
                  new promissory note issued by Mexicali which shall be
                  subordinated and junior in right of payment to the prior
                  payment in full of all Obligations on the terms satisfactory
                  to Conexant in its sole discretion, which terms will be
                  incorporated into any promissory note issued by Mexicali,
                  effective as of the Exchange Date, as fully as if set forth
                  herein and therein.

         2.4.5. If the Exchange Right is exercised, Alpha shall on the Exchange
         Date, immediately after the consummation of the exchange pursuant to
         Section 2.4.3, deliver to Conexant any note issued pursuant to Section
         2.4.4.2, accompanied by an assignment duly endorsed in blank by Alpha,
         to be held as Collateral securing the payment and performance of the
         Obligations in accordance with the provisions of this Agreement.

         2.4.6. Mexicali shall promptly, and in no event later than five
         Business Days after the Exchange Date, file, individually or jointly
         with Conexant as required by Mexican law, at the Public Registry of
         Property and Commerce (Registro Publico de la Propiedad y de Comercio)
         of the city of Mexicali, State of Baja California, Mexico, an
         annotation on the records relating to the Mexican Mortgage deed and
         such other instruments and documents as Conexant may reasonably request
         to assure that the security interest and mortgage Lien of the Mexican
         Mortgage secures the Alpha Exchange Note and that such security
         interest and mortgage Lien is a legal, valid, binding, enforceable and
         fully perfected, first-priority security interest and mortgage Lien,
         subject only to Permitted Liens. Mexicali, Alpha and the Obligors shall
         execute and deliver such documents, including, without limitation,
         amendments to the U.S. Mortgages, and updates to any title insurance
         policy delivered to Alpha on the Closing Date in respect of
         Trans-Tech's property in Frederick, Maryland, as Conexant may
         reasonably request to assure that the security interest and mortgage
         Lien of the U.S. Mortgages secures the Alpha Exchange Note and that
         such security interest and mortgage Lien is a legal, valid, binding,
         enforceable and fully perfected, first-priority security interest and
         mortgage Lien.

         2.4.7. Alpha shall pay or reimburse Conexant for all fees, costs, and
         expenses associated with the filings referred to in Section 2.4.7,
         including all mortgage, notary, documentary, stamp or other filing or
         recording fees or taxes related thereto, title insurance premiums in
         respect of Trans-Tech's property in Frederick, Maryland and reasonable
         attorney fees and expenses related thereto, within 10

                                       12
<PAGE>
         Business Days after Conexant's request therefor and delivery to Alpha
         of an invoice, statement of account or other appropriate documentation.

         2.4.8. The Alpha Exchange Note shall be an Alpha Obligation from and
         after the time it is issued and delivered as herein provided.
         Mexicali's obligations under this Section 2.4 shall be Mexicali
         Obligations.

2.5.     PAYMENTS AND PREPAYMENTS.

         2.5.1. ADDRESS FOR PAYMENT. Payments of both principal and interest on
         Revolving Loans and Acquisition Notes shall be made by wire transfer,
         in lawful money of the United States of America in immediately
         available funds, to the account of Conexant at Comerica Bank, Detroit,
         Michigan, ABA #072000096, Account Number 1850967629 (or at any other
         place in the United States of America previously designated by Conexant
         at least ten (10) Business Days before the given payment date), not
         later than 11:00 a.m. (Pacific time).

         2.5.2. PAYMENTS ON A BUSINESS DAY. If any payment on any Revolving Loan
         or Acquisition Note becomes due and payable on a Saturday, Sunday or
         other day on which commercial banks in Michigan are authorized or
         required by law to close, the date for payment thereof shall be
         extended to the next succeeding business day. Interest on the
         outstanding principal amount of any Revolving Loan or Acquisition Note
         shall accrue during such extension at the then Applicable Rate.

                                   SECTION 3

                                   GUARANTIES


3.1. ALPHA GUARANTY. Alpha hereby unconditionally and irrevocably guaranties, as
primary obligor and not merely as a surety, (x) the due and punctual payment and
performance, as and when due, of all Mexicali Obligations and (y) the payment of
all Mexicali Obligations, whether or not due and payable by Mexicali, upon the
occurrence of any Bankruptcy Event in respect of Mexicali, such amount to be
paid on demand.

3.2. ALPHA SUBSIDIARY GUARANTY. Each Alpha Subsidiary, jointly and severally
with each other Alpha Subsidiary, hereby unconditionally and irrevocably
guaranties, as primary obligor and not merely as a surety, (x) the due and
punctual payment and performance, as and when due, of all Mexicali Obligations
and Alpha Obligations and (y) the payment of all Mexicali Obligations and Alpha
Obligations, whether or not due and payable by Mexicali or Alpha, upon the
occurrence of any Bankruptcy Event in respect of Mexicali or Alpha, such amount
to be paid on demand.


                                       13
<PAGE>
         3.2.1. LIMITATION ON ALPHA SUBSIDIARY GUARANTY. Anything contained in
         Section 3.2 to the contrary notwithstanding, the obligations of each
         Alpha Subsidiary hereunder shall be limited to a maximum aggregate
         amount equal to the greatest amount that would not render such Alpha
         Subsidiary's obligations hereunder (x) unlawful under any applicable
         foreign law or (y) subject to avoidance as a fraudulent transfer or
         conveyance under Section 548 of Title 11 of the United States Code or
         any provisions of applicable state law or similar laws of other
         jurisdictions (collectively, the "FRAUDULENT TRANSFER LAWS"), in each
         case after giving effect to all other liabilities of such Alpha
         Subsidiary, contingent or otherwise, that are relevant under the
         Fraudulent Transfer Laws (specifically excluding, however, in the case
         of any Alpha Subsidiary organized under the laws of any state, any
         liabilities of such Alpha Subsidiary (a) in respect of intercompany
         indebtedness to Alpha or Affiliates of Alpha to the extent that such
         indebtedness would be discharged in an amount equal to the amount paid
         by such Alpha Subsidiary hereunder and (b) under any guaranty of senior
         unsecured indebtedness or indebtedness subordinated in right of payment
         to the Obligations guarantied hereunder which guaranty contains a
         limitation as to maximum amount similar to that set forth in this
         Section, pursuant to which the liability of such Alpha Subsidiary
         hereunder is included in the liabilities taken into account in
         determining such maximum amount) and after giving effect as assets to
         the value (as determined under the applicable provisions of the
         Fraudulent Transfer Laws) of any rights to subrogation, contribution,
         reimbursement, indemnity or similar rights of such Alpha Subsidiary
         pursuant to (i) applicable law, (ii) Section 3.2.2 or (iii) any other
         agreement providing for an equitable allocation among such Alpha
         Subsidiary and other Affiliates of Alpha of obligations arising under
         guaranties by such parties.

         3.2.2. CONTRIBUTION. Each Alpha Subsidiary (a "CONTRIBUTING GUARANTOR")
         agrees, subject to the other provisions in this Section, that, in the
         event a payment shall be made by any other Alpha Subsidiary hereunder
         or assets of any other Alpha Subsidiary shall be sold pursuant to any
         Security Document to satisfy a claim of Conexant hereunder and such
         other Alpha Subsidiary (a "CLAIMING GUARANTOR") shall not have been
         fully indemnified by Alpha, to the extent permitted by applicable law,
         the Contributing Guarantor shall indemnify the Claiming Guarantor in an
         amount equal to the amount of such payment or the greater of the book
         value or the fair market value of such assets, as the case may be, in
         each case multiplied by a fraction of which the numerator shall be the
         net worth of the Contributing Guarantor on the Closing Date and the
         denominator shall be the net worth of all the Alpha Subsidiaries on the
         Closing Date (or, in the case of any person that becomes a Guarantor
         pursuant to Section 9.11 hereof, the date the Financing Agreement
         Supplement is executed). Notwithstanding the foregoing, all rights of
         the Alpha Subsidiaries under this Section 3.2.2 and all

                                       14
<PAGE>
         other rights of indemnity, contribution and subrogation under
         applicable law or otherwise shall be fully subordinated to the
         indefeasible payment in full in cash of the Obligations. No failure on
         the part of any Alpha Subsidiary to make the payments required by this
         Section 3.2.2 (or any other payments required under applicable law or
         otherwise) shall in any respect limit the obligations and liabilities
         of any other Guarantor with respect to its obligations hereunder, and
         each Guarantor shall remain liable for the full amount of the
         obligations of such Guarantor hereunder.

         3.2.3. INFORMATION. Each of the Alpha Subsidiaries assumes all
         responsibility for being and keeping itself informed of Alpha's and
         Mexicali's financial condition and assets, and of all other
         circumstances bearing upon the risk of nonpayment of the Obligations
         guarantied hereunder and the nature, scope and extent of the risks that
         such Alpha Subsidiary assumes and incurs hereunder, and agrees that
         Conexant will have no duty to advise any Alpha Subsidiary of
         information known to it regarding such circumstances or risks.

3.3. EXPENSES. The Guarantors, jointly and severally, agree to pay all
reasonable out-of-pocket costs and expenses of Conexant in connection with the
enforcement of this Guaranty (including the reasonable fees and disbursements of
outside counsel employed by Conexant).

3.4. GUARANTY OF PAYMENT. The Guarantors, jointly and severally, agree that this
Guaranty constitutes a guaranty of payment when due and not of collection, and
waive any right to require that any resort be had by Conexant to any of the
Collateral or other security held for payment of the Obligations guarantied
hereunder or to offset any credit on the books of Conexant in favor of any
Guarantor or any other person.

3.5. UNCONDITIONAL GUARANTY. The liability of each Guarantor hereunder is
primary, absolute and unconditional and is exclusive and independent of any
security for, or other guaranty of, the indebtedness of Alpha or Mexicali
whether executed by such Guarantor, any other Guarantor, any other guarantor or
by any other person, and the liability of each Guarantor hereunder shall not be
affected or impaired by any circumstance or occurrence whatsoever, including
without limitation: (a) any direction as to application of payment by Alpha,
Conexant or by any other person, (b) any other continuing or other guaranty,
undertaking or maximum liability of a guarantor or any other person as to the
Obligations guarantied hereunder, (c) any payment on or in reduction of any such
other guaranty or undertaking, (d) any payment made to Conexant on the
Obligations guarantied hereunder which Conexant repays Alpha, Mexicali or any
other Guarantor pursuant to court order in any bankruptcy, reorganization,
arrangement, moratorium or other debtor relief proceeding, and each Guarantor
waives any right to the deferral or modification of its obligations hereunder by
reason of any such proceeding, (e) any action or inaction by Conexant as
contemplated in Section 3.8 hereof or (f) any invalidity, irregularity or


                                       15
<PAGE>
unenforceability of all or any part of the Obligations guarantied hereunder or
of any security therefor.

3.6. INDEPENDENT OBLIGATIONS. The obligations of each Guarantor hereunder are
independent of the obligations of any other Guarantor, any other guarantor,
Alpha or Mexicali, and a separate action or actions may be brought and
prosecuted against each Guarantor whether or not action is brought against any
other Guarantor, any other guarantor, Alpha or Mexicali and whether or not any
other Guarantor, any other guarantor, Alpha or Mexicali is joined in any such
action or actions.

3.7. WAIVER OF NOTICES. Each Guarantor hereby waives notice of acceptance of
this Guaranty and notice of any liability to which it may apply, and waives
promptness, diligence, presentment, demand of payment, protest, notice of
dishonor or nonpayment of any such liabilities, suit or taking of other action
by Conexant or against, and (to the maximum extent permitted by applicable law)
any other notice to, any person liable thereon (including such Guarantor, any
other Guarantor, any other guarantor, Alpha or Mexicali). This Guaranty is a
continuing one and all liabilities to which it applies or may apply under the
terms hereof shall be conclusively presumed to have been created in reliance
hereon.

3.8. NO RELEASE OF GUARANTY. Conexant may at any time and from time to time
without the consent of, or notice to, any Guarantor (except as shall be required
by applicable law and cannot be waived), without incurring responsibility to
such Guarantor, without impairing or releasing the obligations of such Guarantor
hereunder, upon or without any terms or conditions and in whole or in part:

         (i) change the manner, place or terms of payment of, and/or change or
         extend the time of payment of, renew, alter or increase, any of the
         Obligations guarantied hereunder (including any increase or decrease in
         the rate of interest thereon), any security therefor, or any liability
         incurred directly or indirectly in respect thereof, and the Guaranty
         herein made shall apply to the Obligations guarantied hereunder as so
         changed, extended, renewed, altered or increased;

         (ii) take and hold security for the payment of the Obligations
         guarantied hereunder and sell, exchange, release, surrender, impair,
         realize upon or otherwise deal with in any manner and in any order any
         Collateral or other property by whomsoever at any time pledged or
         mortgaged to secure, or howsoever securing, the Obligations guarantied
         hereunder or any liabilities (including any of those hereunder)
         incurred directly or indirectly in respect thereof or hereof, and/or
         any offset against such property;

         (iii) exercise or refrain from exercising any rights against Alpha or
         Mexicali, any other Guarantor or other guarantors, or otherwise act or
         refrain from acting;


                                       16
<PAGE>
         (iv) release or substitute any one or more endorsers, Guarantors, other
         guarantors, Alpha or other obligors or any Collateral or other security
         for the Obligations;

         (v) settle or compromise any of the Obligations guarantied hereunder,
         any Collateral or other security therefor or any liability (including
         any of those hereunder) incurred directly or indirectly in respect
         thereof or hereof, and may subordinate the payment of all or any part
         thereof to the payment of any liability (whether due or not) of Alpha
         or Mexicali to creditors of Alpha or Mexicali other than Conexant;

         (vi) apply any sums by whomsoever paid or howsoever realized to any
         liability or liabilities of Alpha or Mexicali to Conexant regardless of
         what liabilities of Alpha or Mexicali remain unpaid;

         (vii) consent to or waive any breach of, or any act, omission or
         default under, any of the Financing Documents or any of the instruments
         or agreements referred to therein, or otherwise amend, modify or
         supplement any of the Financing Documents or any of such other
         instruments or agreements;

         (viii) act or fail to act in any manner referred to in this Guaranty
         which may deprive such Guarantor of its right to subrogation against
         Alpha or Mexicali to recover full indemnity for any payments made
         pursuant to this Guaranty; and/or

         (ix) take any other action which would, under otherwise applicable
         principles of common law, give rise to a legal or equitable discharge
         of such Guarantor from its liabilities under this Guaranty.

3.9. SUBORDINATION AND SUBROGATION. Upon payment by any Guarantor of any sums to
Conexant as provided above, all rights of such Guarantor arising as a result
thereof by way of subrogation, contribution, reimbursement, indemnity or
otherwise shall in all respects be subordinate and junior in right of payment to
the prior payment in full in cash of all the Obligations. In addition, any
indebtedness of Alpha or Mexicali or any other Guarantor now or hereafter held
by any Guarantor is hereby subordinated in right of payment to the prior payment
in full of the Obligations. If any amount shall erroneously be paid to any
Guarantor on account of (i) such subrogation, contribution, reimbursement,
indemnity or similar right or (ii) any such indebtedness of Alpha or Mexicali or
any Guarantor, and if an Event of Default shall have occurred and be continuing,
such amount shall be paid to Conexant to be credited against the payment of the
Obligations guarantied hereunder. After the occurrence and during the
continuance of an Event of Default, if so requested by Conexant, any
indebtedness of Alpha or Mexicali or another Guarantor held by any Guarantor
shall be collected, enforced and received by such Guarantor as trustee for
Conexant and be paid over to Conexant on

                                       17
<PAGE>
account of the Obligations guarantied hereunder, but without affecting or
impairing in any manner the liability of any Guarantor under the other
provisions of this Guaranty. Each Guarantor hereby agrees that it will not
exercise any right of subrogation, contribution, reimbursement, or indemnity
which it may at any time have as a result of this Guaranty (whether contractual,
under Section 509 of the Bankruptcy Code or otherwise) until all Obligations
guarantied hereunder have been paid in full in cash.

3.10. CERTAIN ACTIONS WAIVED. Each Guarantor waives any right (except as shall
be required by applicable law and cannot be waived) to require Conexant to: (i)
proceed against Alpha, Mexicali or any other Guarantor, any other guarantor of
the Obligations guarantied hereunder or any other person; (ii) proceed against
or exhaust any Collateral or any other security held from Alpha, Mexicali, any
other Guarantor, any other guarantor of the Obligations guarantied hereunder or
any other person; or (iii) pursue any other remedy in Conexant's power
whatsoever. Each Guarantor waives any defense based on or arising out of any
defense of Alpha, Mexicali or any other Guarantor, any other guarantor of the
Obligations guarantied hereunder or any other person other than payment in full
in cash of the Obligations guarantied hereunder, including, without limitation,
any defense based on or arising out of the disability of Alpha, Mexicali or any
other Guarantor, any other guarantor of the Obligations guarantied hereunder or
any other person, any stay or defense to payment arising out of any Bankruptcy
Event relating to Alpha, Mexicali or any other Guarantor, any other guarantor of
the Obligations guarantied hereunder or the unenforceability of the Obligations
guarantied hereunder or any part thereof from any cause, or the cessation from
any cause of the liability of Alpha, Mexicali or any other Guarantor, any other
guarantor of the Obligations guarantied hereunder or any other person, other
than payment in full in cash of the Obligations guarantied hereunder. Conexant
may, at its election, foreclose on any collateral or any other security held by
Conexant by one or more judicial or non-judicial sales (to the extent such sale
is permitted by applicable law), or exercise any other right or remedy Conexant
may have against Alpha, Mexicali or any other person, or any Collateral or other
security, without affecting or impairing in any way the liability of any
Guarantor hereunder except to the extent the Obligations guarantied hereunder
have been paid in full in cash. Each Guarantor waives any defense arising out of
any such election by Conexant, even though such election operates to impair or
extinguish any right of reimbursement or subrogation or other right or remedy of
such Guarantor against Alpha, Mexicali or any other person or any Collateral or
other security for the Obligations.

3.11. CALIFORNIA REAL PROPERTY WAIVERS. Each Guarantor hereby acknowledges and
affirms that it understands that to the extent that Obligations guarantied
hereunder are secured by real property located in the State of California, such
Guarantor shall be liable for the full amount of its liability hereunder except
to the extent that the Obligations have been paid in full in cash, whether
pursuant to a foreclosure on such real property by trustee sale or by Conexant's
action against Alpha, any Guarantor, or any other guarantor

                                       18
<PAGE>
of the Obligations guarantied hereunder. In accordance with Section 2856 of the
California Civil Code, each Guarantor hereby waives:

         (a) all rights of subrogation, reimbursement, indemnification, and
         contribution and any other rights and defenses that are or may become
         available to such Guarantor by reason of Sections 2787 to 2855,
         inclusive, 2899 and 3433 of the California Civil Code;

         (b) all rights and defenses that such Guarantor may have because the
         Obligations guarantied hereunder are secured by real property located
         in the State of California. This means, among other things: (A)
         Conexant may collect from such Guarantors without first foreclosing on
         any real or personal property collateral pledged by Alpha or any other
         Obligor; and (B) if Conexant forecloses on any real property collateral
         pledged by Alpha or any other Obligor, (1) the amount of the
         Obligations guarantied hereunder may be reduced only by the price for
         which that collateral is sold at the foreclosure sale, even if the
         collateral is worth more than the sale price, and (2) Conexant may
         collect from such Guarantor even if Conexant, by foreclosing on the
         real property collateral, has destroyed any right such Guarantor may
         have to collect from Alpha. This is an unconditional and irrevocable
         waiver of any rights and defenses such Guarantor may have because the
         Obligations guarantied hereunder are secured by real property located
         in the State of California. These rights and defenses include, but are
         not limited to, any rights or defenses based upon Section 580a, 580b,
         580d or 726 of the California Code of Civil Procedure; and

         (c) all rights and defenses arising out of an election of remedies by
         Conexant, even though that election of remedies, such as a non-judicial
         foreclosure with respect to security for the Obligations guarantied
         hereunder, has destroyed such Guarantor's rights of subrogation and
         reimbursement against Alpha by the operation of Section 580d of the
         California Code of Civil Procedure or otherwise.

Each Guarantor warrants and agrees that each of the waivers set forth above is
made with full knowledge of its significance and consequences and that if any of
such waivers are determined to be contrary to any applicable law or public
policy, such waivers shall be effective only to the maximum extent permitted by
law.

3.12. REINSTATEMENT. Each Guarantor agrees that this Guaranty shall continue to
be effective or be reinstated, as the case may be, if at any time any payment
(in whole or in part) of any of the Obligations guarantied hereunder is
rescinded or must otherwise be restored by Conexant upon the insolvency,
bankruptcy or reorganization of Alpha or any other Guarantor or otherwise, as
though such payment had not been made.


                                       19
<PAGE>
                                   SECTION 4

                               SECURITY INTERESTS


4.1. GRANT OF SECURITY INTEREST. As security for the prompt and complete payment
and performance when due of all Obligations, each Obligor hereby assigns,
transfers, mortgages, hypothecates, pledges and grants a security interest to,
and charges in favor of, Conexant in all Collateral in which such Obligor has
any right, title or interest, whether now existing or hereafter acquired.

4.2. FILINGS. Each Obligor hereby authorizes Conexant to file such financing
statements (including fixture filings), continuation statements or amendments of
financing statements, each in form reasonably acceptable to Conexant, as
Conexant may from time to time reasonably deem necessary to establish and
maintain a valid, enforceable, first-priority, perfected security interest in
the Collateral, subject only to Permitted Liens, as provided herein and in the
other Security Documents, and the other rights and security contemplated hereby
and thereby, all in accordance with the UCC as enacted in any and all relevant
jurisdictions, or any other relevant law. Such financing statements may describe
the Collateral in the same manner as described in this Agreement or may contain
a indication or description of collateral that describes such property in any
other manner as Conexant may determine, in its sole discretion, is necessary,
advisable or prudent to ensure the perfection of the security interest in the
collateral granted to Conexant in connection herewith, including, without
limitation, describing such property as "all assets" or "all personal property",
whether now existing or hereafter acquired. Each such Obligor hereby authorizes
Conexant to file any such financing statements without the signature of the
Obligor where permitted by law. Conexant is hereby authorized to make filings
with the United States Patent and Trademark Office or the United States
Copyright Office (or any successor office or central registry), filings with
mortgage recording offices and filings with such other governmental authorities
as Conexant may consider reasonably necessary or appropriate for the purpose of
perfecting, confirming, continuing, enforcing or protecting the security
interests and Liens granted by each Obligor. Each Obligor agrees to execute,
deliver and record or file, as appropriate, all such mortgages, agreements,
notices or other instruments as Conexant may from time to time reasonably
request and which are reasonably necessary to establish, maintain, preserve,
perfect or protect a first-priority, perfected Lien on any Collateral outside
the United States or in which Conexant otherwise does not have a fully
perfected, first-priority Lien at any time, subject to Permitted Liens.

4.3. POWER OF ATTORNEY. Each Obligor hereby constitutes and appoints Conexant
its true and lawful attorney, irrevocably, with full power after the occurrence
of and during the continuance of an Event of Default (in the name of the Obligor
or otherwise) (i) to

                                       20
<PAGE>
act, require, demand, receive, compound and give acquittance for any and all
moneys and claims for moneys due or to become due to such Obligor under or
arising out of the Collateral, (ii) to endorse any checks or other instruments
or orders in connection therewith, (iii) to sign in the name of any Obligor and
record any document which may be required by the United States Patent and
Trademark Office or the United States Copyright Office in order to effect an
absolute assignment of all right, title and interest in each Trademark, Patent
and Copyright in which Conexant has been granted a security interest hereunder,
(iv) to file any claims or take any action or institute any proceedings which
Conexant may reasonably deem to be necessary or advisable to protect or enforce
its security interest in the Collateral and (v) to execute, deliver, record or
file any other document or instrument and take such other actions as it
considers appropriate in connection with the perfection, protection or
enforcement of its security interest in the Collateral, the possession,
maintenance, preparation for sale, foreclosure, sale, lease, exchange or other
disposition or release of any Collateral or the exercise of any rights or
remedies provided in this Agreement or the other Financing Documents, which
appointment as attorney is coupled with an interest.

4.4. DELIVERY OF COLLATERAL. Each Obligor agrees promptly to deliver or cause to
be delivered to Conexant any and all certificated securities, notes, negotiable
documents, chattel paper or instruments representing Collateral, accompanied by
assignments or powers duly executed in blank or other instruments of transfer
reasonably satisfactory to Conexant for such Collateral as Conexant may
reasonably request.

4.5. FURTHER ACTIONS. Each Obligor will promptly notify Conexant of any property
of the type referred to in Section 5.2.1 which is acquired by such Obligor after
the Closing Date, which has a fair market value or acquisition price,
individually of not more than $100,000, and in the aggregate with any such other
property acquired after the Closing Date and not the subject of a prior
notification to Conexant under this Section of $500,000 and in the case of any
such after-acquired property which is also referred to in Section 5.2.2, the
information concerning such property set forth in Section 5.2.2. Each Obligor
will, at its own expense and upon the reasonable written request of Conexant,
make, execute, endorse, acknowledge, file and/or deliver to Conexant from time
to time such lists, descriptions and designations of its Collateral, warehouse
receipts, receipts in the nature of warehouse receipts, bills of lading,
documents of title, vouchers, invoices, schedules, confirmatory assignments,
conveyances, financing statements, transfer endorsements, certificates, reports
and other assurances or instruments and take such further steps relating to the
Collateral and other property or rights covered by the security interest hereby
granted, which Conexant deems reasonably appropriate or advisable to preserve,
protect or perfect its security interest in the Collateral, whether or not such
security interest is perfected on the Closing Date.

4.6. NO ASSUMPTION OF LIABILITY. The security interests hereunder are granted as
security only and shall not subject Conexant to, or in any way alter or modify,
any

                                       21
<PAGE>
obligation or liability of any Obligor with respect to or arising out of the
Collateral. Each Obligor shall remain liable to observe and perform all the
conditions and obligations to be observed and performed by it under any
indenture, contract, lease, agreement or instrument that is or relates to
Collateral, all in accordance with the terms thereof, and each Obligor, jointly
and severally, agrees to indemnify and hold harmless Conexant from and against
any and all liability for such performance.

4.7. CHANGE OF NAME OR JURISDICTION. Each Obligor agrees promptly to notify
Conexant in writing of any change in (i) its name, (ii) the jurisdiction where
it is organized, (iii) the nature of its corporate, partnership, limited
liability company or other legal structure, or (iv) its federal taxpayer
identification number. Each Obligor agrees not to effect or permit any change
referred to in the preceding sentence unless all filings have been made under
the UCC or otherwise that are required in order for Conexant to continue at all
times following such change to have a valid, legal and perfected interest in the
Collateral having the same priority as it held prior to such change.

4.8. COLLATERAL RECORDS. Each Obligor agrees to maintain, at its own cost and
expense, such complete and accurate records with respect to the Collateral owned
by it as is consistent with its current practices, but in any event to include
accounting records that are complete and accurate in all material respects and
indicate all payments and proceeds received with respect to any part of the
Collateral, and, at such time or times as Conexant may reasonably request,
promptly to prepare and deliver to Conexant a duly certified schedule or
schedules in form and detail reasonably satisfactory to Conexant showing the
identity, amount and location of any and all Collateral.

4.9. INSPECTION AND VERIFICATION. Each Obligor will permit Conexant, by its
respective representatives and agents to inspect, during normal business hours
and on reasonable notice (but, unless a Default or Event of Default has occurred
and is continuing, no more frequently than once every three months), the
Collateral, all records related thereto (and to make extracts and copies from
such records) and the premises upon which any of the Collateral is located, to
discuss the Obligor's affairs with the officers of such Obligor and to verify
under reasonable procedures the validity, amount, quality, quantity, value,
condition and status of, or any other matter relating to, the Collateral.

4.10. TAXES; LIENS. At its option at any time after ten (10) days' notice to the
applicable Obligor (or, to the extent Conexant deems it reasonably necessary to
act prior to the end of such ten (10) day notice period in order to preserve the
Collateral or the security interest created therein, any shorter notice period),
Conexant may discharge past due taxes, assessments, charges, fees or any Liens
(other than Permitted Liens) at any time levied or placed on the Collateral and
may pay for maintenance and preservation of the Collateral to the extent any
Obligor fails to do so as required by this Agreement, and each Obligor jointly
and severally agrees to reimburse Conexant on demand for any

                                       22
<PAGE>
payment made or expense incurred by Conexant pursuant to this Section; provided,
however, that nothing in this Section shall be interpreted as excusing any
Obligor from the performance of, or imposing any obligation on Conexant to cure
or perform, any covenants or other promises of any Obligor with respect to
taxes, assessments, charges, fees or Liens as set forth herein.

4.11. PROTECTION OF SECURITY. Each Obligor will do nothing to impair the rights
of Conexant in the Collateral. Each Obligor shall, at its own cost and expense,
take any and all commercially reasonable actions necessary to defend its title
to the Collateral against all persons and to defend the security interest of
Conexant granted hereby, and the priority thereof, against any Liens (other than
Permitted Liens).

4.12. USE AND DISPOSITION OF COLLATERAL. None of the Obligors shall make or
permit to be made an assignment, pledge, mortgage, charge or hypothecation of
the Collateral or shall grant any other Lien (other than Permitted Liens) in
respect of the Collateral. None of the Obligors shall make or permit to be made
any transfer of the Collateral to any third party other than as permitted by
this Agreement. Each Obligor shall remain at all times in possession or control
of the Collateral owned by it, except as otherwise permitted by this Agreement.
Unless and until Conexant shall notify the Obligors that an Event of Default
shall have occurred and be continuing and that during the continuance thereof
the Obligors shall not sell, convey, lease, assign, transfer or otherwise
dispose of any Collateral other than inventory in the ordinary course of
business (which notice may be given by telephone if promptly confirmed in
writing), the Obligors may use and dispose of the Collateral in any lawful
manner that is consistent with the provisions of this Agreement and the other
Financing Documents. Each Obligor agrees that it shall not permit any Inventory
to be in the possession or control of any warehouseman, bailee, agent or
processor located in the United States at any time unless such warehouseman,
bailee, agent or processor shall have been notified of the security interest
granted hereby and such Obligor shall have taken all commercially reasonable
steps necessary to obtain the agreement from such warehouseman, bailee, agent or
processor in writing to hold the Inventory subject to the security interest
granted hereby and the instruction of Conexant and to waive and release any Lien
held by it with respect to such Inventory, whether arising by operation of law
or otherwise.

4.13. LIMITATION OF MODIFICATION OF RECEIVABLES. None of the Obligors will,
without Conexant's prior written consent, which consent shall not be
unreasonably withheld, grant any extension of time of payment of any of the
Receivables, compromise, compound or settle the same for less than the full
amount thereof, release, wholly or partly, any person liable for the payment
thereof or allow any credit or discount whatsoever thereon, other than
extensions, credits, discounts, compromises or settlements granted or made in
the ordinary course of business in accordance with such commercially prudent and
standard practices used in industries that are the same as or similar to those
in which such Obligor is engaged.


                                       23
<PAGE>
4.14. COVENANTS REGARDING PATENTS, TRADEMARKS AND COPYRIGHTS.

         4.14.1. Each Obligor agrees that it will not, nor will it knowingly
         permit any of its licensees to, do any act, or omit to do any act,
         whereby any Patent which is material to the conduct of such Obligor's
         business may become transferred, invalidated or dedicated to the
         public, and agrees that it shall continue to mark all products covered
         by any claim of a Patent that is material to the conduct of such
         Obligor's business with the relevant patent number as necessary and
         sufficient to establish and preserve its rights under applicable patent
         laws consistent with such commercially prudent and standard practices
         used in industries that are the same or similar to those in which such
         Obligor is engaged.

         4.14.2. Each Obligor will, and will ensure that its licensees and
         sublicensees will, for each Trademark held in the name of such Obligor
         that is material to the conduct of such Obligor's business, (i)
         maintain such Trademark in full force free from any claim of
         abandonment or invalidity for non-use, (ii) monitor and uphold the
         quality of goods and services marked or provided with the Trademarks,
         and (iii) display such Trademark in commerce with a "(TM)", "SM" or
         notice of Federal registration, as the case may be.

         4.14.3. Each Obligor will, and will ensure that its licensees will, for
         each work covered by a Copyright that is material to the conduct of
         such Obligor's business, publish, reproduce, display, adopt and
         distribute the work with appropriate copyright notice as necessary and
         sufficient to establish and preserve its rights under applicable
         copyright laws in accordance with such commercially prudent and
         standard practices used in industries that are the same or similar to
         those in which such Obligor is engaged.

         4.14.4. Each Obligor shall notify Conexant promptly in writing if it
         knows or has reason to know that any Patent, Trademark or Copyright
         held in the name of such Obligor that is material to the conduct of its
         business may become abandoned, invalidated or rendered unenforceable,
         assigned in whole or in part, or dedicated to the public (including the
         institution of, or any such determination or development in, any
         proceeding in the United States Patent and Trademark Office or the
         United States Copyright Office) regarding such Obligor's ownership of
         such material Patent, Trademark or Copyright, its right to register the
         same, or to maintain the same.

         4.14.5. Each Obligor will take all commercially reasonable necessary
         steps in any proceeding before the United States Patent and Trademark
         Office or the United States Copyright Office or any office or agency in
         any political subdivision of the United States, to maintain and pursue
         each application relating to any Patent, Trademark or Copyright that is
         material to the conduct of such Obligor's business (and to obtain the
         granting or registration of such Patents, Trademarks and/or Copyrights,
         as applicable) and to maintain each issued Patent and each registration
         of Trademarks and Copyrights that is held in the name of such Obligor
         and is material to the conduct of such Obligor's business,

                                       24
<PAGE>
         including timely filings of applications for renewal, affidavits of
         use, affidavits of incontestability and payment of maintenance fees,
         and such other actions, in each case, consistent with such commercially
         prudent and standard practices used in industries that are the same or
         similar to those in which such Obligor is engaged.

         4.14.6. Within thirty (30) days of the acquisition or issuance of any
         Patent, registered Copyright or registered Trademark or the filing of
         an application for registration of a Patent, Trademark, or Copyright,
         the relevant Obligor shall, at its own expense, deliver to Conexant a
         copy of the Copyright, certificate or registration of, or evidence of
         the application for, such Patent, Trademark or Copyright, as the case
         may be, together with a duly executed assignment for security as to
         such Patent, Trademark, or Copyright, as the case may be, in form and
         substance reasonably satisfactory to Conexant.

         4.14.7. In the event that any Obligor has reason to believe that any
         Collateral consisting of a Patent, Trademark, Copyright or trade secret
         held in the name of such Obligor and material to the conduct of such
         Obligor's business has been or is about to be infringed,
         misappropriated or diluted by a third party, such Obligor promptly
         shall notify Conexant in writing (where such infringement,
         misappropriation or dilution is reasonably likely to have a Material
         Adverse Effect) and shall take such actions as such Obligor deems
         appropriate under the circumstances to enjoin and/or seek redress for
         such infringement, misappropriation or dilution and protect such
         Collateral in accordance with such commercially prudent and standard
         practices used in industries that are the same as or similar to those
         in which such Obligor is engaged.

         4.14.8. Upon and during the continuance of an Event of Default, each
         Obligor shall use all commercially reasonable efforts to obtain all
         requisite consents or approvals by the licensor of each Copyright,
         Patent or Trademark licensed to such Obligor by a third party to effect
         the assignment of all of such Obligor's right, title and interest
         thereunder to Conexant or its designee.

4.15.    COVENANTS REGARDING PLEDGED SECURITIES.

         4.15.1. VOTING RIGHTS, DIVIDENDS AND INTEREST; NO DEFAULT. Unless and
         until an Event of Default shall have occurred and be continuing:

                  (1) Each Obligor shall be entitled to exercise any and all
                  voting and/or other consensual rights and powers inuring to an
                  owner of Pledged

                                       25
<PAGE>
                  Securities or any part thereof for any purpose; provided,
                  however, that such Obligor will not be entitled to exercise
                  any such right if the result thereof could reasonably be
                  expected to materially and adversely affect the rights inuring
                  to a holder of the Pledged Securities or the rights and
                  remedies of Conexant under this Agreement or any other
                  Financing Document or the ability of Conexant to exercise the
                  same; provided, further, that the voting by an Obligor of
                  Pledged Securities for, or the Obligor's consent to, (x) the
                  election of directors at regularly scheduled annual or other
                  meetings of stockholders (or any adjournment thereof) or (y)
                  any action otherwise permitted by this Agreement or any other
                  Financing Document shall not be deemed to materially and
                  adversely affect the rights and remedies of Conexant under
                  this Agreement or any other Financing Document or the ability
                  of Conexant to exercise the same.

                  (2) Each Obligor shall be entitled to receive and retain any
                  and all cash dividends, distributions, interest and principal
                  paid on the Pledged Securities to the extent and only to the
                  extent that such cash dividends, distributions, interest and
                  principal are permitted by the terms and conditions of this
                  Agreement and the other Financing Documents and applicable
                  laws. All noncash dividends, distributions, interest and
                  principal, and all dividends, distributions, interest and
                  principal paid or payable in cash or otherwise in connection
                  with a partial or total liquidation or dissolution, return of
                  capital, capital surplus or paid-in surplus, and all other
                  distributions (other than distributions referred to in the
                  preceding sentence) made on or in respect of the Pledged
                  Securities, whether paid or payable in cash or otherwise,
                  whether resulting from a subdivision, combination or
                  reclassification of the outstanding capital stock of the
                  issuer of any Pledged Securities or received in exchange for
                  Pledged Securities or any part thereof, or in redemption
                  thereof, or as a result of any merger, consolidation,
                  acquisition or other exchange of assets to which such issuer
                  may be a party or otherwise, shall be and become part of the
                  Collateral, and, if received by any Obligor, shall not be
                  commingled by such Obligor with any of its other funds or
                  property but shall be held separate and apart therefrom, shall
                  be held in trust for the benefit of Conexant and shall be
                  forthwith delivered to Conexant in the same form as so
                  received (with any necessary endorsement).

                  (3) Conexant shall execute and deliver to each Obligor, or
                  cause to be executed and delivered to each Obligor, all such
                  proxies, powers of attorney and other instruments as such
                  Obligor may reasonably request for the purpose of enabling
                  such Obligor to exercise the voting and/or consensual rights
                  and powers it is entitled to exercise pursuant to subparagraph
                  (1) above and to receive the cash dividends it is entitled to
                  receive pursuant to

                                       26
<PAGE>
                  subparagraph (2) above.

         4.15.2. VOTING RIGHTS, DIVIDENDS, AND INTEREST; AFTER DEFAULT. Upon the
         occurrence and during the continuance of an Event of Default:

                  (1) All rights of any Obligor to dividends, distributions,
                  interest or principal that such Obligor is authorized to
                  receive pursuant to Section 4.15.1 above shall cease, and all
                  such rights shall thereupon become vested in Conexant, which
                  shall have the sole and exclusive right and authority to
                  receive and retain such dividends, distributions, interest or
                  principal. All dividends, distributions, interest or principal
                  received by such Obligor contrary to the provisions of this
                  Section shall be held in trust for the benefit of Conexant,
                  shall be segregated from other property or funds of such
                  Obligor and shall be forthwith delivered to Conexant upon
                  demand in the same form as so received (with any necessary
                  endorsement). Any and all money and other property paid over
                  to or received by Conexant pursuant to the provisions of this
                  Section shall be retained by Conexant in an account to be
                  established by Conexant upon receipt of such money or other
                  property and shall be applied in accordance with the
                  provisions of Section 6.

                  (2) All rights of any Obligor to exercise the voting and
                  consensual rights and powers it is entitled to exercise
                  pursuant to Section 4.15.1 shall cease, and all such rights
                  shall thereupon become vested in Conexant, which shall have
                  the sole and exclusive right and authority to exercise such
                  voting and consensual rights and powers; provided that
                  Conexant shall have the right from time to time following and
                  during the continuance of an Event of Default to permit the
                  Obligors to exercise such rights.

                  (3) Conexant shall have the right (in its sole and absolute
                  discretion) (i) to hold the Pledged Securities in its own name
                  as pledgee, the name of its nominee (as pledgee or as
                  sub-agent), or the name of the Obligors, endorsed or assigned
                  in blank in favor of Conexant and (ii) to exchange the
                  certificates representing Pledged Securities for certificates
                  of smaller or larger denominations for any purpose consistent
                  with this Agreement.

         4.15.3. NOTICES. Each Obligor will promptly provide to Conexant copies
         of any notices or other communications received by it with respect to
         the Pledged Securities registered in the name of such Obligor.


                                       27
<PAGE>
         4.15.4. SECURITIES ACT, ETC. In view of the position of the Obligors in
         relation to the Pledged Securities, or because of other current or
         future circumstances, a question may arise under the Securities Act of
         1933, as now or hereafter in effect, or any similar statute in any
         other jurisdiction or hereafter enacted analogous in purpose or effect
         (such Act and any such similar statute as from time to time in effect
         being called the "SECURITIES LAWS") with respect to any disposition of
         the Pledged Securities permitted hereunder. Each Obligor understands
         that compliance with the Securities Laws might very strictly limit the
         course of conduct of Conexant if Conexant were to attempt to dispose of
         all or any part of the Pledged Securities, and might also limit the
         extent to which or the manner in which any subsequent transferee of any
         Pledged Securities could dispose of the same. Similarly, there may be
         other legal restrictions or limitations affecting Conexant in any
         attempt to dispose of all or part of the Pledged Securities under
         applicable blue sky or other state securities laws or similar laws
         analogous in purpose or effect. Each Obligor recognizes that in light
         of such restrictions and limitations Conexant may, with respect to any
         sale of the Pledged Securities, limit the purchasers to those who will
         agree, among other things, to acquire such Pledged Securities for their
         own account, for investment, and not with a view to the distribution or
         resale thereof. Each Obligor acknowledges and agrees that in light of
         such restrictions and limitations, Conexant, in its sole and absolute
         discretion, (a) may proceed to make such a sale whether or not a
         registration statement for the purpose of registering such Pledged
         Securities or part thereof shall have been filed under the Securities
         Laws and (b) may approach and negotiate with a single potential
         purchaser or a limited number of potential purchasers to effect such
         sale. Each Obligor acknowledges and agrees that any such sale might
         result in prices and other terms less favorable to the seller than if
         such sale were a public sale without such restrictions. In the event of
         any such sales, Conexant shall incur no responsibility or liability for
         selling all or any part of the Pledged Securities at a price that
         Conexant, in its sole and absolute discretion, may in good faith deem
         reasonable under the circumstances, notwithstanding the possibility
         that a substantially higher price might have been realized if the sale
         were deferred until after registration under the Securities Laws or if
         more than a single purchaser or a limited number of purchasers were
         approached. The provisions of this Section will apply notwithstanding
         the existence of a public or private market upon which the quotations
         or sales prices may exceed substantially the price at which Conexant
         sells.

4.16.    COVENANTS REGARDING INSURANCE.

         4.16.1. PROPERTY AND CASUALTY ENDORSEMENTS. Each Obligor shall cause
         all of its property and casualty policies (i) to be endorsed or
         otherwise amended to include a "standard" or "New York" lender's loss
         payable endorsement, in form and substance reasonably satisfactory to
         Conexant, which endorsement shall

                                       28
<PAGE>
         provide that if the insurance carrier shall have received a written
         notice from Conexant of the occurrence of an Event of Default, the
         insurance carrier shall pay all proceeds otherwise payable to any
         Obligor under such policies directly to Conexant and (ii) to contain a
         "Replacement Cost Endorsement", without any deduction for depreciation,
         and such other provisions as Conexant may reasonably require from time
         to time to protect its interests.

         4.16.2. GENERAL LIABILITY ENDORSEMENTS. Each Obligor shall cause all of
         its general liability policies to be endorsed or otherwise amended to
         list Conexant as an "Additional Insured", in form and substance
         reasonably satisfactory to Conexant.

         4.16.3. MAINTENANCE OF INSURANCE. Each Obligor shall maintain with
         financially sound and responsible insurance companies, (x) replacement
         value property and casualty insurance covering its assets and (y) such
         other insurance in at least such amounts, against at least such risks
         and with no greater risk retention as are usually maintained, insured
         against or retained, as the case may be, by companies of established
         repute engaged in the same or a similar business; and will furnish to
         Conexant, upon request, information presented in reasonable detail as
         to the insurance so carried. Promptly as practicable following any
         request therefor by Conexant, Alpha shall furnish to Conexant copies of
         all policies of insurance covering any Obligor.

         4.16.4. CHANGES IN INSURANCE. No Obligor shall cancel, modify (except
         to the extent not materially adverse to Conexant) or not renew for any
         reason any property or casualty policy or any general liability policy
         upon less than thirty (30) days' prior written notice thereof to
         Conexant. Each Obligor shall promptly deliver to Conexant, concurrent
         with or as reasonably practical thereafter, (i) evidence of the
         cancellation, modification or nonrenewal of any such policy and (ii) a
         copy of a renewal or replacement policy, together with evidence of
         payment of the premium therefor.

                                   SECTION 5

                         REPRESENTATIONS AND WARRANTIES


         To induce Conexant to enter into this Agreement, each of the Obligors,
jointly and severally, makes the following representations and warranties as of
the Closing Date, each and all of which shall survive the execution and delivery
of this Agreement and all of the other Financing Documents, subject to Section
5.3:


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<PAGE>
5.1.     GENERAL REPRESENTATIONS AND WARRANTIES.

         5.1.1. ORGANIZATION. Except as set forth in Schedule 5.1.1(a), Alpha
         and each of its Subsidiaries is a corporation or organization duly
         incorporated or organized, validly existing and in good standing under
         the laws of the jurisdiction of its incorporation or organization.
         Schedule 5.1.1(b) is a complete and accurate list of all Subsidiaries
         of Alpha as of the Closing Date (after giving effect to the Merger and
         the Purchase Documents) and the jurisdiction of incorporation and
         organization of each such Subsidiary. Each of the Excluded Subsidiaries
         is inactive and does not engage in any business or operations. The
         value of the properties and assets of the Excluded Subsidiaries in the
         aggregate does not exceed $100,000.

         5.1.2. CORPORATE POWER. Each of the Obligors has the requisite
         corporate or other similar power and authority (x) to execute, deliver
         and perform this Agreement and the other Financing Documents to which
         it is a party and (y) to own its properties and carry on its business
         as now conducted.

         5.1.3. AUTHORIZATION; VALID AND BINDING AGREEMENT. All corporate action
         required to be taken by each of the Obligors and its respective
         officers, directors and stockholders for the authorization, execution,
         delivery and performance of this Agreement and the other Financing
         Documents to which it is a party have been taken and are in full force
         and effect. Each Person executing this Agreement or other Financing
         Documents on behalf of each of the Obligors is its authorized officer.
         This Agreement is, and each of the other Financing Documents executed
         pursuant hereto will be, legal, valid, and binding obligations of the
         Obligors parties thereto subject to applicable bankruptcy, insolvency,
         reorganization, moratorium or other laws affecting creditors' rights
         generally and subject to general principles of equity, regardless
         whether considered in a proceeding in equity or at law.

         5.1.4. NO CONFLICT; GOVERNMENT APPROVALS. The execution, delivery and
         performance by the Obligors of this Agreement and the other Financing
         Documents to which any Obligor is a party will not (i) conflict with,
         violate or result in the breach of any provision of any applicable law;
         or (ii) conflict with or result in the breach of any provision of their
         respective articles of incorporation, charters, by-laws or other
         organizational documents, except, in the case of clause (i), for such
         breaches as would not reasonably be expected to have a Material Adverse
         Effect. No authorization, consent or approval of, or other action by,
         and no notice of or filing with, any Governmental Authority is required
         to be obtained or made by any of the Obligors for the due execution,
         delivery and performance of this Agreement or the other Financing
         Documents to which any Obligor is a party, other than the filings
         contemplated by Section 4 of this Agreement.


                                       30
<PAGE>
         5.1.5. THIRD PARTY CONSENTS. The execution, delivery and performance by
         each of the Obligors of this Agreement and the other Financing
         Documents to which any Obligor is a party will not:

                  (1) require any consent or approval of any person (other than
                  a Governmental Authority) which has not been obtained prior
                  to, and which is not in full force and effect as of, the
                  Closing Date;

                  (2) result in the breach of, default under, or cause the
                  acceleration of any obligation owed under any loan, credit
                  agreement, note, security agreement, lease, indenture,
                  mortgage, loan document, license or other agreement by which
                  any of them are bound or affected; or

                  (3) result in, or require the creation or imposition of, any
                  Lien on any of their respective properties, other than
                  pursuant to this Agreement and the other Financing Documents;

         except, in each case, for such consents, approvals, breaches, defaults,
         or accelerations as would not reasonably be expected to have a Material
         Adverse Effect.

         5.1.6. NO EVENTS OF DEFAULT. No Default or Event of Default has
         occurred and is continuing.

         5.1.7. SOLVENCY. Each of the Obligors is, and after giving effect to
         this Agreement will be, Solvent.

         5.1.8. PRO FORMA FINANCIAL STATEMENTS. The unaudited, pro forma
         Skyworks Consolidated Balance Sheets and Cash Flow Statements for each
         of the fiscal quarters ended September 30, 2002 through June 30, 2003
         set forth in Schedule 5.1.8 (the "FINANCIAL PROJECTIONS") have been
         prepared in good faith by Alpha, are based on assumptions which are
         believed to be reasonable and the best information available to Alpha
         as of the Closing Date. As of the Closing Date, Alpha believes that the
         Financial Projections are reasonable and attainable, subject to the
         qualification that projections as to future events are inherently
         uncertain and are subject to various contingencies (many of which are
         outside Alpha's control) and that the actual results during the periods
         covered by the Financial Projections may differ from the projected
         results and the differences may be material.


                                       31
<PAGE>
5.2.     REPRESENTATIONS AND WARRANTIES CONCERNING COLLATERAL.

         5.2.1. TYPES OF COLLATERAL. Set forth in Schedule 5.2.1 is a complete
         and accurate description of each Material Item of Collateral in which
         any Obligor has any right, title or interest on the Closing Date that
         is:

                  (1) Real Property, Fixtures or an interest therein located in
                  the United States or Mexico;

                  (2) Deposit Accounts, Security Accounts or similar accounts
                  maintained with financial institutions in the United States;

                  (3) Investment Property (other than Security Accounts),
                  including Pledged Securities;

                  (4) Letter of Credit Rights held by or on behalf of any
                  Obligor in the United States;

                  (5) Instruments held by or on behalf of any Obligor in the
                  United States;

                  (6) Patents;

                  (7) registered Trademarks or applications for registration
                  that have been filed in the United States Patent and Trademark
                  Office; and

                  (8) registered Copyrights or applications for registration
                  that have been filed in the United States Copyright Office.

         5.2.2. LOCATION OF CERTAIN COLLATERAL. Set forth in Schedule 5.2.2 is a
         complete and accurate description for each Material Item of Collateral
         located in the United States (and in the case of clause (1) hereof,
         Mexico) in which any Obligor has any right, title or interest on the
         Closing Date, of:

                  (1) the location of any Real Property or Fixture in the United
                  States or Mexico;

                  (2) the jurisdiction of any bank or other financial
                  institution at which each Deposit Account or similar account
                  is maintained, determined in accordance with Section 9-304 of
                  the UCC;

                  (3) the jurisdiction in which any certificated security is
                  located, the jurisdiction of the issuer of any uncertificated
                  security, the jurisdiction of any securities intermediary at
                  which any security entitlement or securities

                                       32
<PAGE>
                  account is held, and the jurisdiction of any commodity
                  intermediary at which any commodity account or commodity
                  contract is held, determined in each case in accordance with
                  Section 9-305 of the UCC;

                  (4) the jurisdiction of the issuer or nominated person in
                  respect of any Letter of Credit Rights, determined in
                  accordance with Section 9-306 of the UCC; and

                  (5) the jurisdiction where any Instrument is located.

         5.2.3. LOCATION OF OBLIGORS. Set forth in Schedule 5.2.3 is the
         location of each Obligor, determined in accordance with Section 9-307
         of the UCC.

         5.2.4. NO LIENS. Each Obligor has good title to all of its material
         properties and assets, subject only to Permitted Liens. None of the
         Collateral is subject to any Lien of any kind, other than Permitted
         Liens. As of the Closing Date, there is no financing statement (or
         similar statement or instrument under the laws of any jurisdiction in
         the United States) covering or purporting to cover any interest of any
         kind in the Collateral, other than financing statements filed pursuant
         to this Agreement or the other Security Documents or in respect of (i)
         Permitted Liens or financing statements for which proper termination
         statements have been delivered to Conexant for filing or (ii) other
         obligations which in the aggregate do not exceed $100,000.

         5.2.5. SECURITY INTEREST. The provisions of this Agreement and the
         other Security Documents are effective to create in favor of Conexant a
         legal, valid and enforceable security interest in all of the Collateral
         of each Obligor, in each case to the extent that a security interest in
         the Collateral may be created under the UCC in any jurisdiction and, as
         the case may be, under the applicable Mexican laws in connection with
         the Mexican Security Documents.

         5.2.6. FINANCING STATEMENTS. Upon timely filing of financing statements
         naming each Obligor as "debtor" and Conexant as "Secured Party" and
         describing the Collateral, in the jurisdictions set forth in Schedule
         5.2.6, the security interest granted to Conexant hereunder will
         constitute a fully perfected, first priority security interest in all
         of the Collateral of each Obligor as to which a security interest may
         be perfected by filing of financing statements under the UCC in any
         jurisdiction, subject only to Permitted Liens and to the rights of
         Governmental Authorities with respect to receivables of such
         Governmental Authorities.

         5.2.7. PATENTS AND TRADEMARKS. Upon timely recordation of the Security
         Interest in Trademarks and Patents in the United States Patent and
         Trademark Office, together with timely filing of financing statements
         in the jurisdictions set

                                       33
<PAGE>
         forth in Schedule 5.2.7, Conexant will have a fully perfected, first
         priority security interest in all of the Collateral held in the name of
         each Obligor consisting of Patents and Trademarks registered with the
         United States Patent and Trademark Office, subject only to Permitted
         Liens.

         5.2.8. INTELLECTUAL PROPERTY GENERALLY. To the knowledge of each
         Obligor, other than as set forth in Schedule 5.2.8: (i) no third party
         is infringing, misappropriating or diluting any material Patents,
         Trademarks, Copyrights, trade secrets, or other Intellectual Property,
         in each case held in the name of any Obligor; (ii) the validity,
         enforceability, registerability, inventorship or ownership of the
         material Patents, Trademarks, Copyrights or other Intellectual
         Property, in each case held in the name of any Obligor, is not being
         challenged; (iii) each Obligor has taken commercially reasonable
         measures to protect and preserve the security, confidentiality and
         value of the material Intellectual Property held in the name of such
         Obligor; (iv) no Obligor or any third party (where any Obligor is a
         licensee) is in default of any License relating to the use of any
         material Intellectual Property; (v) the Collateral or its use by each
         Obligor or their licensees or customers does not infringe,
         misappropriate or dilute any patents, trademarks, copyrights, trade
         secrets or other intellectual property rights of any third party and no
         such claim has been made or threatened by any third party against any
         Obligor with respect to such use; and (vi) all maintenance fees for the
         Patents and Trademarks have been paid through the Closing Date.

         5.2.9. PLEDGED SECURITIES. So long as Conexant has possession of the
         Pledged Securities, it will have a fully perfected, first priority
         security interest in the Pledged Securities of the Domestic
         Subsidiaries and, provided the corporate recordings set forth in the
         Mexican Stock Pledge Agreement have been timely made, Mexicali. Except
         for the corporate recordings set forth in the Mexican Stock Pledge
         Agreement and the other actions set forth in Section 2.3.9.4, no
         filings or recordings are required to perfect (or maintain the
         perfection or priority of) the security interests created in the
         Pledged Securities of the Domestic Subsidiaries and Mexicali. Conexant
         will have a fully perfected pledge of the Pledged Securities of the
         Foreign Subsidiaries upon compliance by Alpha and such Foreign
         Subsidiaries with Section 2.3.9.

         5.2.10. INVESTMENT PROPERTY. Upon execution and delivery of the
         Securities Account Control Agreements by each of the parties thereto,
         and assuming compliance by each securities intermediary or commodity
         intermediary which is a party thereto, Conexant will have (x) "control"
         within the meaning of Section 9-106 of the UCC of each account referred
         to in such agreements and all security entitlements or commodity
         contracts carried in such accounts and (y) a fully perfected, first
         priority security interest in each account referred to therein

                                       34
<PAGE>
         and all Investment Property credited to any such account subject to
         such Securities Account Control Agreement.

         5.2.11. DEPOSIT ACCOUNTS; BANK ACCOUNTS. Upon execution and delivery of
         the Bank Account Control Agreements by each of the parties thereto, and
         assuming compliance by each bank or depositary which is a party
         thereto, Conexant will have (x) "control" within the meaning of Section
         9-104 of the UCC with respect to each Deposit Account subject to such
         Bank Account Control Agreement, (y) exclusive dominion and control with
         respect to each bank or depositary account subject to such Bank Account
         Control Agreement which is not a Deposit Account or Securities Account,
         and (z) a fully perfected, first priority security interest in all
         funds held in each account subject to such Bank Account Control
         Agreement.

         5.2.12. MORTGAGES. The U.S. Mortgages and accompanying UCC financing
         statements create a valid and enforceable perfected security interest
         in and mortgage Lien on all the Mortgaged Properties referred to
         therein in favor of Conexant, superior to the rights of all third
         persons, and subject to no Liens other than Permitted Liens. Upon
         recording of the U.S. Mortgages in the filing offices set forth in
         Schedule 5.2.12 and the filing of the UCC financing statements in the
         filing offices set forth in Schedule 5.2.6, such security interest and
         mortgage Lien will be fully perfected. The Mexican Mortgages create a
         valid, first priority and enforceable perfected security interest in
         and mortgage Lien on all the Mortgaged Properties (as defined in the
         Mexican Mortgages) and subject to no Liens other than Permitted Liens.
         Upon recording of the Mexican Mortgages in the filing offices (Oficina
         Registradora) located in Mexicali, Mexico and in the Public Registry of
         Property and Commerce (Registro Publico de la Propiedad y de Comercio)
         of the State of Baja California, Mexico, such security interest and
         mortgage Lien will be fully perfected.

5.3.     SCOPE OF CERTAIN REPRESENTATIONS AND WARRANTIES.

         5.3.1. ALPHA OBLIGORS. The representations and warranties made in
         Sections 5.1.1 through 5.1.6, 5.2.4 and 5.2.8 are made only with
         respect to Alpha and those other Obligors which were Subsidiaries of
         Alpha immediately prior to the Merger and, with respect to the
         representations and warranties made by Alpha in Sections 5.1.4 and
         5.1.5, excluding any conflict, violation, Governmental Approval,
         consent, approval, breach, default, acceleration or Lien arising or
         required under any law, rule, regulation, order, permit, license or
         Contract that was not binding on Alpha prior to the Merger. No
         representation or warranty is made in Section 5.2.8 in respect of any
         Intellectual Property, License or Collateral to which Alpha succeeded
         as a result of the Merger.


                                       35
<PAGE>
         5.3.2. ALL OBLIGORS. The representations and warranties made in
         Sections 5.1.7 and 5.1.8 are made in respect of Alpha and all of the
         other Obligors, after giving effect to the Merger, the acquisitions
         contemplated by the Purchase Documents and the financing contemplated
         by this Agreement and the other Financing Documents.

         5.3.3. COLLATERAL SCHEDULES. The representations and warranties made in
         Sections 5.2.1 through 5.2.3, Section 5.2.6 and Section 5.2.7 (and in
         the Schedules referred to therein) are made in respect of Alpha and all
         of the other Obligors, after giving effect to the Merger, the
         acquisitions contemplated by the Purchase Documents and the financing
         contemplated by this Agreement and the other Financing Documents,
         subject to the qualification that any error or omission therein which
         (1) relates solely to Collateral directly or indirectly acquired by
         Alpha in the Merger or the acquisitions contemplated by the Purchase
         Documents and (2) is based on representations and warranties made in
         the Purchase Documents, schedules of the Contribution Agreement or
         information concerning Washington or any Subsidiary of Washington or
         Mexicali in any of the above-referenced Schedules supplied by or on
         behalf of Washington or any Subsidiary of Washington or Mexicali
         expressly for use in this Agreement or any other Financing Document
         shall not be deemed a breach of such representations and warranties.

         5.3.4. SECURITY INTERESTS. The representations and warranties in (x)
         Sections 5.2.5 through 5.2.7, except for that part of Section 5.2.6 or
         5.2.7 which is based on Section 5.2.3 concerning Washington and its
         subsidiaries, and (y) Sections 5.2.9 through 5.2.12 are made in respect
         of Alpha and all of the other Obligors, after giving effect to the
         Merger, the transactions contemplated by the Purchase Documents and the
         financing contemplated by this Agreement and the other Financing
         Documents.

                                   SECTION 6

                  REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT


6.1. REMEDIES; OBTAINING THE COLLATERAL UPON DEFAULT. Each Obligor agrees that,
if any Event of Default shall have occurred and be continuing, then and in every
such case, Conexant, in addition to any rights now or hereafter existing under
applicable law, shall have all rights as a secured creditor on default under any
UCC, and such additional rights and remedies to which a secured creditor is
entitled under the laws in effect, in all relevant jurisdictions and may:


                                       36
<PAGE>
         (a) personally, or by agents or attorneys, immediately take possession
         of the Collateral or any part thereof, from such Obligor or any other
         person who then has possession of any part thereof with or without
         notice or process of law, and for that purpose may enter upon such
         Obligor's premises where any of the Collateral is located and remove
         the same and use in connection with such removal any and all services,
         supplies, aids and other facilities of such Obligor;

         (b) instruct the obligor or obligors on any agreement, instrument or
         other obligation (including, without limitation, the Receivables)
         constituting the Collateral to make any payment required by the terms
         of such agreement, instrument or other obligation directly to Conexant
         and may exercise any and all remedies of such Obligor in respect of
         such Collateral;

         (c) sell, assign or otherwise liquidate any or all of the Collateral or
         any part thereof in accordance with Section 6.2 hereof, or direct the
         relevant Obligor to sell, assign or otherwise liquidate any or all of
         the Collateral or any part thereof, and, in each case, take possession
         of the proceeds of any such sale or liquidation; and

         (d) take possession of the Collateral or any part thereof, by directing
         the relevant Obligor in writing to deliver the same to Conexant at any
         place or places designated by Conexant, in which event such Obligor
         shall at its own expense:

                  (x) forthwith cause the same to be delivered to the place or
         places so designated by Conexant;

                  (y) store and keep any Collateral so delivered to Conexant at
         such place or places pending further action by Conexant as provided in
         Section 6.2 hereof; and

                  (z) while the Collateral shall be so stored and kept, provide
         such guards and maintenance services as shall be necessary to protect
         the same and to preserve and maintain the collateral in good condition;

it being understood that each Obligor's obligation to so deliver the Collateral
is of the essence of this Agreement and that, accordingly, upon application to a
court of equity having jurisdiction, Conexant shall be entitled to a decree
requiring specific performance by such Obligor of said obligation.

6.2.     REMEDIES; DISPOSITION OF THE COLLATERAL.

         6.2.1. TRADEMARKS. Upon the occurrence and during the continuance of an
         Event of Default, Conexant may, by written notice to the relevant
         Obligor, take

                                       37
<PAGE>
         any or all of the following actions: (i) declare the entire right,
         title and interest of such Obligor in and to each of the Trademarks,
         together with all trademark rights and rights of protection to the
         same, vested in Conexant, in which event such right, title and interest
         shall immediately vest in Conexant, and Conexant shall be entitled to
         exercise the power of attorney referred to in Section 4.3 hereof to
         execute, cause to be acknowledged and notarized and record said
         absolute assignment with the applicable agency; (ii) take and sell or
         license or sublicense the Trademarks and the goodwill of such Obligor's
         business symbolized by the Trademarks and the right to carry on the
         business and use the assets of such Obligor in connection with which
         the Trademarks have been used; and (iii) direct such Obligor to
         refrain, in which event such Obligor shall refrain, from using the
         Trademarks in any manner whatsoever, directly or indirectly, and such
         Obligor shall execute such further documents that Conexant may
         reasonably request to further confirm this and to transfer ownership of
         the Trademarks and registrations and any pending trademark application
         in the United States Patent and Trademark Office to Conexant.

         6.2.2. PATENTS AND COPYRIGHTS. Upon the occurrence and during the
         continuance of an Event of Default, Conexant may by written notice to
         the relevant Obligor, take any or all of the following actions: (i)
         declare the entire right, title, and interest of such Obligor in each
         of the Patents and Copyrights vested in Conexant, in which event such
         right, title, and interest shall immediately vest in Conexant and
         Conexant shall be entitled to exercise the power of attorney referred
         to in Section 4.3 hereof to execute, cause to be acknowledged and
         notarized and record said absolute assignment with the applicable
         agency; (ii) take, practice and sell or license or sublicense the
         Patents and Copyrights; and (iii) direct such Obligor to refrain, in
         which event such Obligor shall refrain, from practicing the Patents and
         using the Copyrights, directly or indirectly, and such Obligor shall
         execute such further documents as Conexant may reasonably request
         further to confirm this and to transfer ownership of the Patents and
         Copyrights to Conexant.

         6.2.3. PLEDGED SECURITIES. Upon the occurrence and during the
         continuance of an Event of Default, subject to applicable regulatory
         and legal requirements, Conexant may sell the Pledged Securities, or
         any part thereof, at public or private sale or at any broker's board or
         on any securities exchange or electronic trading facility, for cash,
         upon credit or for future delivery as Conexant shall deem appropriate.
         Conexant shall be authorized at any such sale (if it deems it advisable
         to do so) to restrict the prospective bidders or purchasers to persons
         who will represent and agree that they are purchasing the Pledged
         Securities for their own account for investment and not with a view to
         the distribution or sale thereof, and upon consummation of any such
         sale Conexant shall have the right to assign, transfer and deliver to
         the purchaser or purchasers thereof the Pledged Securities so sold.
         Each such purchaser at any such sale shall hold the property

                                       38
<PAGE>
         sold absolutely free from any claim or right on the part of any
         Obligor, and, to the extent permitted by applicable law, the Obligors
         hereby waive all rights of redemption, stay, valuation and appraisal
         any Obligor now has or may at any time in the future have under any
         rule of law or statute now existing or hereafter enacted. Conexant
         shall give each person entitled to notice of such sale under Section
         9-611(c) of the UCC ten (10) days' prior written notice (which each
         Obligor agrees is reasonable notice within the meaning of Section 9-612
         of the UCC) of Conexant's intention to make any sale of Pledged
         Securities. Such notice shall conform to the requirements of Section
         9-613 of the UCC. Any such public sale shall be held at such time or
         times within ordinary business hours and at such place or places as
         Conexant may fix and state in the notice of such sale. At any such
         sale, the Pledged Securities, or portion thereof, to be sold may be
         sold in one lot as an entirety or in separate parcels, as Conexant may
         (in its sole and absolute discretion) determine. Conexant shall not be
         obligated to make any sale of any Pledged Securities if it shall
         determine not to do so, regardless of the fact that notice of sale of
         such Pledged Securities shall have been given. Conexant may, without
         notice or publication, adjourn any public or private sale or cause the
         same to be adjourned from time to time by announcement at the time and
         place fixed for sale, and such sale may, without further notice, be
         made at the time and place to which the same was so adjourned. In case
         any sale of all or any part of the Pledged Securities is made on credit
         or for future delivery, the Pledged Securities so sold may be retained
         by Conexant until the sale price is paid in full by the purchaser or
         purchasers thereof, but Conexant shall not incur any liability in case
         any such purchaser or purchasers shall fail to take up and pay for the
         Pledged Securities so sold and, in case of any such failure, such
         Pledged Securities may be sold again upon like notice. At any public
         (or, to the extent permitted by applicable law, private) sale made
         pursuant to this Section, Conexant may bid for or purchase, free from
         any right of redemption, stay or appraisal on the part of any Obligor
         (all said rights being also hereby waived and released), the Pledged
         Securities or any part thereof offered for sale and may make payment on
         account thereof by using any claim then due and payable to it from such
         Obligor as a credit against the purchase price, and it may, upon
         compliance with the terms of sale, hold, retain and dispose of such
         property without further accountability to such Obligor therefor. For
         purposes hereof, (a) a written agreement to purchase the Pledged
         Securities or any portion thereof shall be treated as a sale thereof,
         (b) Conexant shall be free to carry out such sale pursuant to such
         agreement, and (c) such Obligor shall not be entitled to the return of
         the Pledged Securities or any portion thereof subject thereto,
         notwithstanding the fact that after Conexant shall have entered into
         such an agreement, all Events of Default shall have been remedied and
         the Obligations paid in full. As an alternative to exercising the power
         of sale herein conferred upon it, Conexant may proceed by a suit or
         suits at law or in equity to foreclose upon the Pledged Securities and
         to sell the Pledged

                                       39
<PAGE>
         Securities or any portion thereof pursuant to a judgment or decree of a
         court or courts having competent jurisdiction or pursuant to a
         proceeding by a court-appointed receiver. Any sale pursuant to the
         provisions of this Section shall be deemed to be a commercially
         reasonable disposition as provided in Section 9-610 of the UCC.

         6.2.4. ALL COLLATERAL. If any Event of Default shall have occurred and
         be continuing, then any Collateral repossessed by Conexant under or
         pursuant to Section 6.1 hereof and any other Collateral whether or not
         so repossessed by Conexant, may be sold, assigned, leased or otherwise
         disposed of under one or more contracts or as an entirety, and without
         the necessity of gathering at the place of sale the property to be
         sold, and in general in such manner, at such time or times, at such
         place or places and on such terms as Conexant may, in compliance with
         any mandatory requirements of applicable law, determine to be
         commercially reasonable. Any of the Collateral may be sold, leased or
         otherwise disposed of in the condition in which the same existed when
         taken by Conexant or after any overhaul or repair at the expense of the
         relevant Obligor which Conexant shall determine to be commercially
         reasonable. Conexant shall give each person entitled to notice of such
         disposition under Section 9-611(c) of the UCC ten (10) days' prior
         written notice (which each Obligor agrees is reasonable notice within
         the meaning of Section 9-612 of the UCC). Such notice shall conform to
         the requirements of Section 9-613 of the UCC. Conexant may, without
         notice or publication, adjourn any public or private sale or cause the
         same to be adjourned from time to time by announcement at the time and
         place fixed for the sale, and such sale may be made at any time or
         place to which the sale may be so adjourned. To the extent permitted by
         any such requirement of law, Conexant may bid for and become the
         purchaser of the Collateral or any item thereof, offered for sale in
         accordance with this Section without accountability to any Obligor.
         Each Obligor agrees to do or cause to be done all such other acts and
         things as may be reasonably necessary to make such sale or sales of all
         or any portion of the Collateral valid and binding and in compliance
         with any and all applicable laws, regulations, orders, writs,
         injunctions, decrees or awards of any and all courts, arbitrators or
         governmental instrumentalities, domestic or foreign, having
         jurisdiction over any such sale or sales, all at such Obligor's
         expense.

         6.2.5. LETTERS OF CREDIT. If any Event of Default shall have occurred
         and be continuing, Conexant may direct any financial institution that
         is the issuer, confirmer or nominated person of any letter of credit
         issued to (a) Alpha or any Subsidiary of Alpha or (b) Conexant or any
         subsidiary of Conexant as beneficiary which letter of credit is (in
         whole or in part) a Washington Asset (as defined in the Contribution
         Agreement), in either case, to make payments due under any such letter
         of credit to such account or accounts as Conexant may direct, to be
         held as

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<PAGE>
         cash Collateral securing the Obligations and/or applied then or
         thereafter to payment of the Obligations, as otherwise provided herein.

         6.2.6. WAIVER OF CLAIMS. Except as otherwise provided in this
         Agreement, EACH OBLIGOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY
         APPLICABLE LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH
         CONEXANT'S TAKING POSSESSION OR CONEXANT'S DISPOSITION OF ANY OF THE
         COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND
         HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES, and each Obligor hereby
         further waives, to the extent permitted by law:

                  (1) all damages occasioned by such taking of possession except
                  any damages which are the direct result of Conexant's gross
                  negligence or willful misconduct;

                  (2) all other requirements as to the time, place and terms of
                  sale or other requirements with respect to the enforcement of
                  Conexant's rights hereunder; and

                  (3) all rights of redemption, appraisement, valuation, stay,
                  extension or moratorium now or hereafter in force under any
                  applicable law in order to prevent or delay the enforcement of
                  this Agreement or the absolute sale of the Collateral or any
                  portion thereof, and each Obligor, for itself and all who may
                  claim under it, insofar as it or they now or hereafter
                  lawfully may, hereby waives the benefit of all such laws.

         Any sale of, or the grant of options to purchase, or any other
         realization upon, any Collateral shall operate to divest all right,
         title, interest, claim and demand, either at law or in equity, of the
         relevant Obligor therein and thereto, and shall be a perpetual bar both
         at law and in equity against such Obligor and against any and all
         Persons claiming or attempting to claim the Collateral so sold,
         optioned or realized upon, or any part thereof, from, through and under
         such Obligor.

         6.2.7. APPLICATION OF PROCEEDS. All moneys collected by Conexant (or,
         to the extent any additional Financing Document requires proceeds of
         Collateral under such Financing Document to be applied in accordance
         with the provisions of this Agreement, the pledgee or mortgagee under
         such other Financing Document) upon any sale or other disposition of
         the Collateral, together with all other moneys received by Conexant
         hereunder, shall be applied as follows:

                  (1) first, to the payment of all amounts owing Conexant of the
                  type described in clauses (i), (ii) and (iii) of the
                  definition of "Obligations";


                                       41
<PAGE>
                  (2) second, to the extent proceeds remain after the
                  application pursuant to the preceding clause (1), an amount
                  equal to the outstanding Obligations shall be paid to
                  Conexant; and

                  (3) third, to the extent proceeds remain after the application
                  pursuant to the preceding clauses (1) and (2), and following
                  the termination of this Agreement, to the relevant Obligor or
                  to whomever may be lawfully entitled to receive such surplus.

         The Obligors shall remain jointly and severally liable to the extent of
         any deficiency between the amount of the proceeds of the Collateral and
         the aggregate amount of the Obligations.

         6.2.8. REMEDIES CUMULATIVE. Each and every right, power and remedy
         hereby specifically given to Conexant shall be in addition to every
         other right, power and remedy specifically given under this Agreement
         or the other Financing Documents, now or hereafter existing at law, in
         equity or by statute and each and every right, power and remedy whether
         specifically herein given or otherwise existing may be exercised from
         time to time or simultaneously and as often and in such order as may be
         deemed expedient by Conexant. All such rights, powers and remedies
         shall be cumulative and the exercise or the beginning of the exercise
         of one shall not be deemed a waiver of the right to exercise any other
         or others. No delay or omission of Conexant in the exercise of any such
         right, power or remedy and no renewal or extension of any of the
         Obligations shall impair any such right, power or remedy or shall be
         construed to be a waiver of any Default or Event of Default or an
         acquiescence therein. No notice to or demand on any Obligor in any case
         shall entitle it to any other or further notice or demand in similar or
         other circumstances or constitute a waiver of any of the rights of
         Conexant to any other or further action in any circumstances without
         notice or demand. In the event that Conexant shall bring any suit to
         enforce any of its rights hereunder and shall be entitled to judgment,
         then in such suit Conexant may recover reasonable expenses, including
         reasonable attorneys' fees, and the amounts thereof shall be included
         in such judgment.

         6.2.9. DISCONTINUANCE OF PROCEEDINGS. In case Conexant shall have
         instituted any proceeding to enforce any right, power or remedy under
         this Agreement by foreclosure, sale, entry or otherwise, and such
         proceeding shall have been discontinued or abandoned for any reason or
         shall have been determined adversely to Conexant, then and in every
         such case the relevant Obligor, Conexant and each holder of any of the
         Obligations shall be restored to their former positions and rights
         hereunder with respect to the Collateral subject to the security
         interest created under this Agreement, and all rights, remedies and
         powers of Conexant shall continue as if no such proceeding had been
         instituted.


                                       42
<PAGE>
                                   SECTION 7

                                    COVENANTS


         Each Obligor, jointly and severally, agrees that, so long as any
Obligations remain outstanding and unpaid or any amount payable under any
Financing Document remains unpaid, unless Conexant shall otherwise agree in
writing:

7.1. PAYMENT OF OBLIGATIONS. It will, and will cause each of its Subsidiaries
to, pay and discharge at or before maturity, all their respective material
obligations and liabilities (including, without limitation, tax liabilities and
claims of materialmen, warehousemen and the like which if unpaid would
reasonably be expected to give rise to a Lien), except where the same may be
contested in good faith by appropriate proceedings (including administrative
proceedings), and appropriate reserves are maintained for the accrual of any of
the same.

7.2. MAINTENANCE OF PROPERTY. It will, and will cause each of its Subsidiaries
to, keep all property useful and necessary in their respective businesses in
good working order and condition, ordinary wear and tear excepted.

7.3. CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. Except as expressly
permitted by Section 7.7, it will, and will cause each of its Subsidiaries to,
(a) continue to engage in business of the same general type as now conducted and
(b) preserve, renew and keep in full force and effect its respective corporate,
partnership, company or other existence and its respective rights, privileges
and franchises material to the normal conduct of its business.

7.4. COMPLIANCE WITH LAWS. It will, and will cause each of its Subsidiaries to,
comply with all applicable laws, ordinances, rules, regulations, and
requirements of Governmental Authorities, except where the failure to so comply
would not reasonably be expected to have a Material Adverse Effect; provided
that no Obligor shall be in breach of this Section 7.4 as a result of the
failure, prior to the Closing Date, of Washington, any Subsidiary of Washington
or Mexicali to so comply, if such Obligor has taken commercially reasonable
steps after the Closing Date to remedy such failure.

7.5. INSPECTION OF PROPERTY, BOOKS AND RECORDS. It will, and will cause each of
its Subsidiaries to, (i) keep proper books of record and account in which
entries shall be made of all dealings and transactions in relation to its
business and activities that are full, true and correct in all material
respects; and (ii) permit a reasonable number of representatives of Conexant to
visit and inspect (at no cost to it or its Subsidiaries unless a Default or
Event of Default has occurred and is continuing) any of their respective
properties, to examine and make abstracts from any of their respective books of
account and other records (unless prohibited by law) and to discuss their
respective affairs,

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<PAGE>
finances and accounts with their respective officers and independent public
accountants, all at such reasonable times and as often as may reasonably be
requested.

7.6. INVESTMENTS. It will not, and will not permit any of its Subsidiaries to,
(i) make, directly or indirectly, any Investment in any other Person, or (ii)
purchase all or any substantial part of the business or assets of any Person,
except that (a) Alpha and Mexicali may acquire assets in accordance with the
Purchase Documents and (b) Alpha and its Subsidiaries (other than Excluded
Subsidiaries) may acquire and hold Permitted Investments.

7.7. FUNDAMENTAL CHANGES. Except in accordance with Section 7.8(e) or (g), it
will not, and will not permit any of its Subsidiaries to, (i) consolidate or
merge with or into any other person other than Alpha or a direct or indirect
Wholly-owned Subsidiary of Alpha which is an Obligor, (ii) except as set forth
in Schedule 7.7(ii) wind up, liquidate or dissolve its affairs, (iii) sell,
lease, transfer or otherwise dispose of (including in connection with a sale and
leaseback transaction) all or substantially all of its properties and assets to
any person other than Alpha or a direct or indirect Wholly-owned Subsidiary of
Alpha which is an Obligor, or (iv) sell the capital stock of any Subsidiary,
except in accordance with Section 7.8(g) or to Alpha or a direct or indirect
Wholly-owned Subsidiary of Alpha which is an Obligor.

7.8. SALES OF ASSETS. It will not, and will not permit any of its Subsidiaries
to, sell, lease, transfer or otherwise dispose of (including in connection with
a sale and leaseback transaction) any of its assets, except that:

         (a) Inventory may be sold in the ordinary course of business consistent
         with past practice,

         (b) Patents, Copyrights and Trademarks may be licensed in the ordinary
         course of business and not in violation of any other provision of this
         Agreement or any other Security Documents,

         (c) Permitted Investments may be sold, exchanged and reinvested in the
         ordinary course of business,

         (d) marketable securities (other than any issued by a Subsidiary of
         Alpha), cash and cash equivalents may be sold for the purpose of:

                  (1) paying expenses associated with the Spin-off, the Merger,
                  the Purchase Documents and the Financing Documents and the
                  transactions contemplated by the foregoing,


                                       44
<PAGE>
                  (2) acquiring other Permitted Investments in the ordinary
                  course of business,

                  (3) funding working capital requirements in the ordinary
                  course of business consistent with past practice, subject in
                  the case of Excluded Subsidiaries and Restricted Subsidiaries
                  to the restrictions in Section 7.18, and

                  (4) making Capital Expenditures permitted by this Agreement,

         (e) sales, leases, transfers or other dispositions of property may be
         made where:

                  (1) the consideration received consists entirely of cash,

                  (2) Alpha shall have given Conexant written notice (not less
                  than ten (10) days prior to the closing of such sale) of such
                  sale and of its or its Subsidiary's intention to replace such
                  property with other property that has a fair market value not
                  materially less than the property disposed of,

                  (3) Alpha or its Subsidiary shall have deposited all Net Cash
                  Proceeds of such sale, lease, transfer or other disposition
                  that are not immediately applied to replace such property (x)
                  in an escrow account (to be held and released subject to terms
                  and conditions reasonably satisfactory to Conexant and
                  consistent with this Section), if such cumulative unused
                  proceeds exceed $100,000 or (y) an account subject to a
                  Securities Account Control Agreement, if such cumulative
                  unused proceeds are $100,000 or less, and

                  (4) within 180 days of such disposition, Alpha or such
                  Subsidiary shall have (x) replaced such property with other
                  property which has a fair market value not materially less
                  than the property disposed of and/or (y) applied all funds not
                  used to replace such property to prepay Notes and Revolving
                  Loans, to the extent required, in accordance with Section
                  2.1.5.4 (and funds shall be released from the escrow account
                  to enable any such replacement or pre-payment to be made in
                  accordance with the terms hereof), or if such funds are not
                  used to replace property and are not required to be applied to
                  prepay Notes or Revolving Loans pursuant to Section 2.1.5.4,
                  to be released to Alpha or such Subsidiary,

         (f) sales, leases, transfers or other dispositions, for cash, of motor
         vehicles or office equipment in the ordinary course of business and not
         material in aggregate amount, and


                                       45
<PAGE>
         (g) sales, leases, transfers or other dispositions of assets may be
         made where:

                  (5) the consideration received consists entirely of cash, and

                  (6) the Net Cash Proceeds of which (x) are at least equal to
                  75% of the book value of such assets, as shown on the
                  consolidated balance sheet of Alpha for the fiscal quarter
                  ended immediately prior to such sale, lease, transfer or other
                  disposition, (y) together with the Net Cash Proceeds of all
                  sales, leases, transfers and other dispositions made in
                  reliance on this Section 7.8(g) during the term of this
                  Agreement do not exceed $50,000,000 in the aggregate and (z)
                  are applied to the prepayment of Note and Revolving Loans, to
                  the extent required, in accordance with Section 2.1.5.4.

7.9. NEGATIVE PLEDGE. It will not, and will not permit any of its Subsidiaries
to, create, assume or suffer to exist any Lien on any asset now owned or
hereafter acquired by it, except: (i) Permitted Liens, and (ii) any Lien
existing on any asset of any Person at the time such Person becomes an Obligor
and not created in contemplation of such event.

7.10. RESTRICTED PAYMENTS. It will not, and will not permit any of its
Subsidiaries to:

         (a) unless it or such Subsidiary is directly or indirectly a
         Wholly-owned Subsidiary of Alpha, declare or pay any dividends, or
         return any capital, to its shareholders or authorize or make any other
         distribution, payment or delivery of property or cash to its
         shareholders as such, or redeem, retire, purchase or otherwise acquire,
         directly or indirectly, for any consideration, any shares of any class
         of its capital stock or interest of any of its shareholders, in each
         case now or hereafter outstanding (or any options or warrants issued by
         it or any of its Subsidiaries with respect to its or any of its
         Subsidiaries' capital stock); except (i) for purchases, redemptions or
         forfeitures of restricted stock held by current or former employees,
         consultants or directors of Alpha or any of its Subsidiaries, not to
         exceed $10,000 in the aggregate during the term of this Agreement, and
         (ii) Alpha may at any time pay dividends with respect to its capital
         stock solely in additional shares of its capital stock,

         (b) pre-pay or otherwise retire prior to its stated maturity any
         Indebtedness (other than the Notes, the Revolving Loans or as permitted
         by Section 7.12(a)(iii) or (xii)), or

         (c) set aside any funds for any of the foregoing purposes.

7.11. TRANSACTIONS WITH AFFILIATES. It will not, and will not permit any of its
Subsidiaries to, directly or indirectly, pay any funds to or for the account of,
make any

                                       46
<PAGE>
Investment in, lease, sell, transfer or otherwise dispose, of any assets,
tangible or intangible, to, or participate in, or effect, any transaction with,
any Affiliate (other than Alpha or a direct or indirect Wholly-owned Subsidiary
of Alpha), except on terms at least as favorable as could have been obtained on
an arm's length basis from a third party or as otherwise permitted hereunder.

7.12. INDEBTEDNESS. It will not, and will not permit any of its Subsidiaries to:

         (a) contract, create, incur, assume or suffer to exist any
         Indebtedness, except: (i) Indebtedness of the Obligors under the
         Financing Documents, (ii) accounts payable incurred by the Obligors in
         the ordinary course of business consistent with past practice, (iii)
         Indebtedness owed to Alpha or any Subsidiary of Alpha representing
         Permitted Investments made on or after the date hereof, (iv) any
         unsecured Indebtedness of Alpha, provided that any Net Cash Proceeds of
         the same are applied to prepay Notes and Revolving Loans to the extent
         required by Section 2.1.5.4, (v) Indebtedness existing on the date
         hereof, which is either (A) Indebtedness of Washington or a Subsidiary
         of Washington or (B) set forth in Schedule 7.12, (vi) Indebtedness
         pursuant to Hedging Agreements entered into in the ordinary course of
         business consistent with past practice and not for the purpose of
         speculation, (vii) Indebtedness resulting from endorsement of
         negotiable instruments for collection in the ordinary course of
         business, (viii) Indebtedness arising under indemnity agreements to
         title insurers to cause such title insurers to issue to Conexant
         mortgage title insurance policies, (ix) Indebtedness arising with
         respect to indemnification, representation, warranty, purchase price
         adjustment or other obligations incurred in connection with sales or
         other dispositions of assets permitted hereunder, (x) Indebtedness
         incurred in the ordinary course of business with respect to surety and
         appeal bonds, performance, insurance and return-of-money bonds, letters
         of credit and other similar obligations, (xi) Indebtedness consisting
         of (1) Purchase Money Indebtedness or (2) Capital Lease Obligations
         incurred in the ordinary course of business after the Closing Date in
         respect of property acquired after the Closing Date; provided that the
         aggregate principal or capitalized amount of any such Indebtedness
         incurred in accordance with this clause (xi) during any fiscal quarter
         during the term of this Agreement shall not exceed $10,000,000 plus any
         unused portion of the Indebtedness permitted to be made pursuant to
         this clause (xi) during any prior fiscal quarter during the term of
         this Agreement, (xii) Indebtedness incurred to extend, renew or
         refinance Indebtedness described in paragraphs (iv), (v) or (xi) above
         ("REFINANCING INDEBTEDNESS") so long as such Refinancing Indebtedness
         is in an aggregate principal amount not greater than the sum of (1) the
         aggregate principal amount of the Indebtedness being extended, renewed
         or refinanced plus (2) ordinary and necessary fees and expenses
         incurred to obtain such Refinancing Indebtedness, and (except for
         Permitted Liens in respect of Purchase Money Indebtedness, Capital
         Lease Obligations and

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<PAGE>
         Indebtedness referred to in clause (a)(v)(A) above) is not secured by
         any property or assets of any Obligor or any Subsidiary of any Obligor,
         or

         (b) guaranty, whether pursuant to fianzas, avales or otherwise, any
         Indebtedness of any other person other than under Section 3 of this
         Agreement or enter into any other Contingent Obligation, except for (i)
         Hedging Agreements entered into in the ordinary course of business
         consistent with past practice and not for the purpose of speculation
         and (ii) guaranties by an Obligor or any of its Subsidiaries of any
         Indebtedness incurred by any other Obligor or any of its Subsidiaries
         to the extent such Indebtedness is permitted by this Section 7.12.

7.13. NOTICE OF DEFAULT; OTHER NOTICES. Alpha will promptly after obtaining
knowledge thereof notify Conexant in writing of the occurrence of (i) any
Default or Event of Default, (ii) any material litigation or proceedings that
are instituted or threatened against it or any of its Subsidiaries or any of its
assets, (iii) each and every event which would be a default or an event of
default under any Indebtedness of Alpha or any of its Subsidiaries that is
outstanding in principal amount of at least $1,000,000 and (iv) any other
development in the business or affairs of Alpha and its Subsidiaries if the
effect thereof could reasonably be expected to have a Material Adverse Effect.

7.14.    FINANCIAL REPORTING.

         7.14.1. FINANCE COMMITTEE. Promptly, and in no event later then five
         days after the Closing Date, Alpha's Board of Directors shall establish
         a committee of the Board of Directors to be named the Finance Committee
         (the "FINANCE COMMITTEE"), as hereinafter provided.

                  7.14.1.1. The Finance Committee shall have the composition,
                  duties and powers set forth in the Finance Committee Charter
                  attached hereto as Exhibit L and shall be maintained in such
                  form until all Obligations are paid in full in cash.

                  7.14.1.2. Alpha shall furnish to the Finance Committee all
                  such financial and other information, in such form and detail,
                  as the Finance Committee may reasonably request from time to
                  time.

         7.14.2. REPORTS. Alpha shall deliver to Conexant such reports
         concerning its business, operations and financial condition, at such
         intervals and in such form and detail, as Conexant may from time to
         time reasonably request. Without further request, Alpha shall deliver
         to Conexant, not later than ten (10) Business Days after the end of
         each month, Alpha's unaudited balance sheet for such month.


                                       48
<PAGE>
         7.14.3. COMPLIANCE CERTIFICATE. Not later than the first to occur of
         (1) the Business Day after Alpha releases to the public its earnings
         report for any fiscal quarter and (2) the date on which Alpha's Form
         10-Q for each of Alpha's first three fiscal quarters shall be due (or
         forty-five days after the end of the fourth fiscal quarter with respect
         to the fourth fiscal quarter), commencing with the fiscal quarter
         ending June 30, 2002, Alpha shall furnish to Conexant a Compliance
         Certificate, signed by Alpha's chief executive officer and chief
         financial officer.

7.15. PAYMENT OF TAXES. It shall, and shall cause each of its Subsidiaries to:

         (a) timely file, or cause to be filed, all tax returns required to be
         filed by such Obligor or any of its Subsidiaries, and

         (b) pay and discharge all Taxes imposed upon it, its income, or its
         assets or properties, prior to the date on which penalties attach
         thereto, except to the extent that (i) any such Taxes are being
         contested in good faith by appropriate proceedings and reserves,
         adequate in Alpha's reasonable opinion, have been established by the
         Obligor or any of its Subsidiaries, as the case may be, on behalf of
         the applicable entity in respect of all such contested Taxes, or (ii)
         Alpha or any of its Subsidiaries is entitled to indemnification in
         respect of such Taxes pursuant to the Tax Allocation Agreement or the
         Purchase Documents.

7.16. CAPITAL EXPENDITURES. It will not make, and will not permit any of its
Subsidiaries to make, Capital Expenditures in excess of $12,500,000 for any
fiscal quarter, in the aggregate for Alpha and all of its Subsidiaries, during
the term of this Agreement; provided that any unused portion of the Capital
Expenditures permitted to be made pursuant to this Section 7.16 during a fiscal
quarter may be made in any subsequent fiscal quarter.

7.17. MINIMUM CASH BALANCE. Alpha shall not permit at any time on or after
December 31, 2002 the sum of (x) the consolidated balance of readily available
cash on deposit with banks or similar accounts of Alpha and its Subsidiaries
plus (y) the fair market value of all marketable securities held by Alpha and
its Subsidiaries (other than securities issued by Alpha or any Subsidiary of
Alpha), in each case subject to no Lien (other than any Lien created under the
Security Documents and customary banker's or broker's liens and rights of setoff
unrelated to margin activity) to be less than $40,000,000.


                                       49
<PAGE>
7.18. EXCLUDED SUBSIDIARIES; RESTRICTED SUBSIDIARIES. It will not, and will not
permit any of its Subsidiaries to, sell, lease, contribute, loan, advance,
assign or otherwise transfer any property that is Collateral to any Excluded
Subsidiary or Restricted Subsidiary, except as hereinafter provided:

         7.18.1. Alpha or any of its Subsidiaries may make loans, capital
         contributions or advances to any Restricted Subsidiary to fund working
         capital and, to the extent permitted by this Agreement, Capital
         Expenditures, of any such Restricted Subsidiary, required in the
         ordinary course of business, in no event to exceed the amounts set
         forth below without Conexant's consent which, for working capital
         required by Restricted Subsidiaries in the ordinary course of business,
         will not be unreasonably withheld:

                  7.18.1.1. For all Restricted Subsidiaries other than Mexicali,
                  (1) for the fiscal quarters ended September 30, 2002 and
                  December 31, 2002, $7,000,000 in the aggregate for each such
                  fiscal quarter and (2) for all fiscal quarters thereafter,
                  $4,500,000 in the aggregate for each such fiscal quarter;

                  7.18.1.2. For Mexicali, for all fiscal quarters, $14,500,000
                  in the aggregate for each such fiscal quarter.

         7.18.2. Alpha or any of its Subsidiaries may make loans, capital
         contributions or advances to any Excluded Subsidiary, in an amount not
         to exceed $10,000 in the aggregate for all Excluded Subsidiaries during
         the term of this Agreement, to the extent required to maintain the
         legal existence of such Excluded Subsidiaries.

         7.18.3. Alpha or any of its Subsidiaries may sell for cash (but not
         otherwise transfer) any property that is Collateral to any Restricted
         Subsidiary to the extent that any such sale would be a sale of assets
         permitted by Section 7.8.

         7.18.4. Alpha or any of its Subsidiaries may transfer to Mexicali
         inventory on a bailment or consignment basis, for assembly, test and
         processing by Mexicali, in the ordinary course of business consistent
         with past practice.

                                   SECTION 8

                                    INDEMNITY


8.1. INDEMNITY. Each Obligor, jointly and severally, agrees to indemnify,
reimburse and hold Conexant and its successors, permitted assigns, employees,
agents and servants (hereinafter in this Section referred to individually as
"INDEMNITEE," and collectively as

                                       50
<PAGE>
"INDEMNITEES") harmless from any and all liabilities, obligations, damages,
injuries, penalties, claims, demands, actions, suits, judgments and any and all
costs, expenses or disbursements (including reasonable attorneys' fees and
expenses) (for the purposes of this Section the foregoing are collectively
called "LOSSES") of whatsoever kind and nature imposed on, asserted against or
incurred by any of the Indemnitees in any way relating to or arising out of this
Agreement or any other Financing Document or in any other way connected with the
administration of the transactions contemplated hereby or thereby or the
enforcement of any of the terms of, or the preservation of any rights under any
thereof, or in any way relating to or arising out of the actions taken or not
taken after the Closing Date in connection with the manufacture, ownership,
ordering, purchase, delivery, performance, control, acceptance, lease,
financing, possession, operation, condition, sale, return or other disposition,
or use of the Collateral (including, without limitation, latent or other
defects, whether or not discoverable), the violation of the laws of any country,
state or other governmental body or unit, any tort (including, without
limitation, claims arising or imposed under the doctrine of strict liability, or
for or on account of injury to or the death of any Person (including any
Indemnitee), or property damage), or contract claim; provided that no Indemnitee
shall be indemnified pursuant to this Section for (x) Losses, to the extent such
Loss is found in a final, nonappealable judgment by a court of competent
jurisdiction to have resulted from such Indemnitee's gross negligence or willful
misconduct or (y) any Excluded Loss. Each Obligor agrees that upon written
notice by any Indemnitee of the assertion of such a liability, obligation,
damage, injury, penalty, claim, demand, action, suit or judgment, the relevant
Obligor shall assume full responsibility for the defense thereof. Each
Indemnitee agrees to use its best efforts to promptly notify the relevant
Obligor of any such assertion of which such Indemnitee has knowledge.

Each Obligor further agrees, jointly and severally, to pay, or reimburse
Conexant for any and all reasonable fees, costs and expenses of whatever kind or
nature incurred in connection with the creation, preservation or protection of
Conexant's Liens on, and security interest in, the Collateral, including,
without limitation, all fees and taxes in connection with the recording or
filing of instruments and documents in public offices, payment or discharge of
any taxes or Liens upon or in respect of the Collateral and all other fees,
costs and expenses in connection with protecting, maintaining or preserving the
Collateral and Conexant's interest therein, whether through judicial proceedings
or otherwise, or in defending or prosecuting any actions, suits or proceedings
arising out of or relating to the Collateral.

Each Obligor further agrees, jointly and severally, to pay, indemnify and hold
each Indemnitee harmless from and against any losses, costs, damages and
expenses which such Indemnitee may suffer, expend or incur in consequence of or
growing out of any misrepresentation by any Obligor in this Agreement, any other
Financing Document.


                                       51
<PAGE>
If and to the extent that the obligations of any Obligor under this Section are
unenforceable for any reason, such Obligor hereby agrees to make the maximum
contribution to the payment and satisfaction of such obligations which is
permissible under applicable law.

8.2. EXPENSE REIMBURSEMENT. Within twenty Business Days after the Closing Date,
Alpha will reimburse Conexant (by wire transfer to Conexant's bank account at
Bank One, N.A., Account No. 51-52283, A.B.A. Routing Number 071000013) for all
amounts in respect of reasonable fees, costs and expenses incurred and paid by
Conexant before or at the Closing Date in connection with the preparation,
negotiation, execution and delivery of the Financing Documents, including
reasonable attorneys' fees and expenses and, to the extent not previously paid
in full pursuant to Section 2.2.12, any record search, title report, transfer,
UCC, Patent and Trademark Office, mortgage, notary, documentary, stamp or other
filing or recording fees or taxes; provided that, within ten (10) Business Days
after the Closing Date, Conexant has notified Alpha in writing of such expenses
and provided Alpha with an invoice, statement of account or other appropriate
supporting documentation therefor. Alpha will reimburse Conexant (by wire
transfer to the same bank account referred to in the preceding sentence) for all
amounts in respect of reasonable fees, costs and expenses incurred and paid by
Conexant after the Closing Date in connection with filings reasonably necessary
to establish or perfect the liens granted by this Agreement, including
reasonable attorneys' fees and expenses and any record search, title report,
transfer, UCC, Patent and Trademark Office, mortgage, notary, documentary, stamp
or other filing or recording fees or taxes related thereto, within twenty
Business Days after Conexant's request therefor and production to Alpha of an
invoice, statement of account or other appropriate supporting documentation.

8.3. INDEMNITY OBLIGATIONS SECURED BY COLLATERAL. Any amounts paid by any
Indemnitee as to which such Indemnitee has the right to reimbursement shall
constitute Obligations secured by the Collateral.

8.4. SURVIVAL. The indemnity obligations of each Obligor contained in this
Section 8 shall continue in full force and effect notwithstanding the full
payment of all of the other Obligations.

                                   SECTION 9

                                  MISCELLANEOUS


9.1. NOTICES. All notices and other communications required or permitted
hereunder shall be in writing and shall be deemed to have been sufficiently
given to any party hereto if personally delivered or if sent by telegram,
telecopy or telex, or by registered or

                                       52
<PAGE>
certified mail, return receipt requested, or by recognized courier service,
postage or other charges prepaid, addressed as follows:

                  (a) If to Alpha or any Alpha Subsidiary:

                      Alpha Industries, Inc.
                      20 Sylvan Road
                      Woburn, MA  01801
                      Fax:  (617) 824-4426
                      Attention:    Paul E. Vincent
                                    Chief Financial Officer

                      with a copy to (not effective for purposes of notice):

                      Alpha Industries, Inc.
                      20 Sylvan Road
                      Woburn, MA  01801
                      Fax:  (617) 824-4564
                      Attention:    General Counsel

                  (b) If to Conexant:

                      Conexant Systems, Inc.
                      4311 Jamboree Road
                      Newport Beach, CA  92660-3095
                      Fax:  (949) 483-6388
                      Attention:    Dennis E. O'Reilly
                                    Senior Vice President, General Counsel
                                    and Secretary

                      with a copy to (not effective for purposes of notice):

                      Chadbourne & Parke
                      30 Rockefeller Plaza
                      New York, New York 10112
                      Fax:  (212) 541-5369
                      Attention:    Peter R. Kolyer, Esq.


or to such other address as may be specified from time to time by Alpha or
Conexant on notice to the other party. Such notice or communication will be
deemed to have been given as of the date so personally delivered, telegraphed,
telecopied, telexed, mailed or sent by courier.


                                       53
<PAGE>
9.2. WAIVER; AMENDMENT. None of the terms and conditions of this Agreement may
be changed, waived, modified or varied in any manner whatsoever unless in
writing duly signed by each Obligor directly affected thereby and Conexant.

9.3. OBLIGATIONS ABSOLUTE. The obligations of each Obligor hereunder shall
remain in full force and effect without regard to, and shall not be impaired by
(a) any Bankruptcy Event in respect of any Obligor; (b) any exercise or
non-exercise, or any waiver of, any right, remedy, power or privilege under or
in respect of this Agreement or any other Financing Document; or (c) any
amendment to or modification of any Financing Document or any release of or
change in the Collateral or other security for any of the Obligations; whether
or not each Obligor shall have notice or knowledge of any of the foregoing.

9.4. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon each Obligor
and its successors and assigns (although no Obligor may assign its rights and
obligations hereunder) and shall inure to the benefit of Conexant and its
successors and permitted assigns. Conexant may assign its rights under this
Agreement and the other Financing Documents to any Person that is not a
Competitor of Alpha, provided that such Person executes an assignment and
assumption in respect of the Revolving Loan and the Commitment hereunder, in
form reasonably satisfactory to Alpha. All agreements, statements,
representations and warranties made by each Obligor herein or in any certificate
or other instrument delivered by such Obligor or on its behalf under this
Agreement shall be considered to have been relied upon by Conexant and shall
survive the execution and delivery of this Agreement and the other Financing
Documents regardless of any investigation made by Conexant or on its behalf.

9.5. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.

9.6. TERMINATION; RELEASE. After the Termination Date, this Agreement shall
terminate (provided that all indemnities set forth herein including, without
limitation, in Section 8.1 hereof shall survive such termination) and Conexant,
at the request and expense of the respective Obligor, will promptly execute and
deliver to such Obligor a proper instrument or instruments (including, without
limitation, UCC termination statements on Form UCC-3, termination notices to
each of the banks or brokers pursuant to any Bank Account Control Agreement and
Securities Account Control Agreement entered into with respect to the
Collateral, releases of Collateral Assignments of Lease and releases of the U.S.
Mortgages and the Mexican Mortgages) acknowledging the satisfaction and
termination of this Agreement and the other Financing Documents and the
termination of the Liens hereunder and thereunder, and will duly assign,
transfer and deliver to such Obligor (without recourse and without any
representation or warranty)

                                       54
<PAGE>
such of the Collateral as may be in the possession of Conexant and as has not
theretofore been sold or otherwise applied or released pursuant to this
Agreement.

9.7. COUNTERPARTS. This Agreement may be executed in any number of counterparts
and by the different parties hereto on separate counterparts, each of which when
so executed and delivered shall be an original, but all of which shall together
constitute one and the same instrument. A set of counterparts executed by all
the parties hereto shall be lodged with each Obligor and Conexant.

9.8. SEVERABILITY. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

9.9. JURISDICTION; CONSENT TO SERVICE OF PROCESS.

         9.9.1. NEW YORK COURTS. Each Obligor hereby irrevocably and
         unconditionally submits, for itself and its property, to the
         nonexclusive jurisdiction of any New York State court or Federal court
         of the United States of America sitting in New York City, and any
         appellate court from any thereof, in any action or proceeding arising
         out of or relating to this Agreement or the other Financing Documents,
         or for recognition or enforcement of any judgment, and each of the
         parties hereto hereby irrevocably and unconditionally agrees that all
         claims in respect of any such action or proceeding may be heard and
         determined in such New York State or, to the extent permitted by law,
         in such Federal court. Each of the parties hereto agrees that a final
         judgment in any such action or proceeding shall be conclusive and may
         be enforced in other jurisdictions by suit on the judgment or in any
         other manner provided by law. Nothing in this Agreement shall affect
         any right that Conexant may otherwise have to bring any action or
         proceeding relating to this Agreement or the other Financing Documents
         against any Obligor or its properties in the courts of any other
         jurisdiction.

         9.9.2. VENUE. Each Obligor hereby irrevocably and unconditionally
         waives, to the fullest extent it may legally and effectively do so, any
         objection that it may now or hereafter have to the laying of venue of
         any suit, action or proceeding arising out of or relating to this
         Agreement or the other Financing Documents in any New York State or
         Federal court. Each Obligor hereby irrevocably waives, to the fullest
         extent permitted by law, the defense of an inconvenient forum to the
         maintenance of such action or proceeding in any such court.

         9.9.3. SERVICE OF PROCESS. Each Obligor irrevocably consents to service
         of process in the manner provided for notices in Section 9.1. Nothing
         in this

                                       55
<PAGE>
         Agreement will affect the right of any party to this Agreement to serve
         process in any other manner permitted by law.

9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN
CONNECTION WITH, THIS AGREEMENT OR THE OTHER FINANCING DOCUMENTS. EACH PARTY
HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE OTHER SECURITY DOCUMENTS, AS APPLICABLE, BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.10.

9.11. ADDITIONAL SUBSIDIARY OBLIGORS. Alpha shall cause each person that becomes
a Subsidiary of Alpha after the Closing Date to execute and deliver to Conexant
a Financing Agreement Supplement and such other agreements, financing statements
or other documents as Conexant may reasonably request to perfect, protect, and
enforce the security interest granted therein, except in the case of any Foreign
Subsidiary, to the extent that, in the opinion of recognized counsel practicing
in the applicable jurisdiction, such action would be unlawful on the part of
such Foreign Subsidiary after taking all reasonable measures consistent with
applicable laws to enable such Foreign Subsidiary to execute and deliver such
documents. Upon execution and delivery after the date hereof by Conexant and
such Subsidiary of a Financing Agreement Supplement, such Subsidiary shall
become an Obligor (and, for purposes of Section 3, an Alpha Subsidiary and
Guarantor) hereunder with the same force and effect as if originally named as
such herein. The execution and delivery of any Financing Agreement Supplement
shall not require the consent of any other Obligor hereunder. The rights and
obligations of each Obligor hereunder shall remain in full force and effect
notwithstanding the addition of any new Obligor as a party to this Agreement.

9.12. CONFIDENTIALITY. Conexant agrees to keep confidential (and to use
reasonable efforts to cause its respective agents and representatives to keep
confidential) the Information (as defined below) and all copies thereof,
extracts therefrom and analyses or other materials based thereon, except that
Conexant shall be permitted to disclose Information (a) to such of its
respective officers, directors, employees, agents, affiliates and
representatives (including, without limitation, attorneys and auditors) as need
to know such Information, (b) to the extent requested by any regulatory
authority (provided such authority shall be advised of the confidential nature
of the Information), (c) to the extent otherwise required by applicable laws and
regulations or by any subpoena or

                                       56
<PAGE>
similar legal process, (d) in connection with any suit, action or proceeding
relating to the enforcement of its rights hereunder or under any of the other
Financing Documents, or (e) to the extent such Information (i) becomes publicly
available other than as a result of a breach of this Section 9.12 or (ii)
becomes available to Conexant on a nonconfidential basis from a source other
than Alpha. For the purposes of this Section, "Information" shall mean all
financial statements, certificates, reports, agreements and information
(including all analyses, compilations and studies prepared by Conexant based on
any of the foregoing) that are received from Alpha or its Subsidiaries and are
identified as "Confidential" or are a type that would normally be accorded
confidential treatment, other than any of the foregoing that were available to
Conexant on a nonconfidential basis prior to its disclosure thereto by Alpha or
any of its Subsidiaries. In the event that Conexant is required by applicable
law, regulation or legal process to disclose any of the Information, Conexant
will, to the extent permitted by law, promptly, notify Alpha in writing. In the
event that no protective order or other remedy is obtained, or that Alpha does
not waive compliance with the terms of this Section, Conexant or its
representative will furnish only that portion of the Information which legal
counsel, satisfactory to Alpha, advises is legally required and Conexant or its
representative shall exercise reasonable efforts at Alpha's expense to preserve
the confidentiality of the remainder of the Information. In no event will
Conexant, or any representative of Conexant, oppose action by Alpha to obtain a
protective order or other relief to prevent the disclosure of the Information or
to obtain reliable assurance that confidential treatment will be afforded the
Information. The provisions of this Section 9.12 shall remain operative and in
full force and effect regardless of the expiration and term of this Agreement.

9.13. ENTIRE AGREEMENT. This Agreement and the other Financing Documents embody
the entire agreement and understanding between the Obligors and Conexant and
supersede all prior agreements and understandings between such parties relating
to the subject matter hereof and thereof. Accordingly, the Financing Documents
may not be contradicted by evidence of prior, contemporaneous or subsequent oral
agreements of the parties.

9.14. NO THIRD PARTY BENEFICIARIES. This Agreement shall be binding on and inure
solely to the benefit of each party hereto and their permitted successors and
assigns and the Indemnitees, and nothing in this Agreement, express or implied,
is intended to or shall confer upon any other Person any right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement.

9.15. WITHHOLDING TAXES. Notwithstanding anything to the contrary in this
Agreement or the Purchase Documents, and except as provided in Section 10.11(d)
of the Mexicali Asset Purchase Agreement, Alpha and Mexicali shall withhold any
Taxes required to be withheld from any amounts payable under this Agreement or
any other Financing Document. If any such Taxes are required to be deducted from
or in respect of amounts paid to Conexant other than in respect of the Mexicali
Note, Alpha shall pay to Conexant,

                                       57
<PAGE>
in the manner provided in Section 1 of the Notes, such amount as may be required
so that after making all required deductions for such Taxes, Conexant shall
receive an amount equal to the sum it would have received had no such deductions
been made. Except as provided in Section 10.11(d) of the Mexicali Asset Purchase
Agreement, if any such Taxes accrue and are required to be deducted from or in
respect of amounts payable to Conexant in respect of the Mexicali Note, Alpha
shall pay to Conexant, in the manner provided in Section 1 of the Notes, such
amount as may be required so that after making all required deductions for such
Taxes, Conexant shall receive an amount equal to the sum it would have received
had only one-half of such deductions been made; provided, however, if Conexant
delivers to Alpha an Exchange Notice requesting Alpha's consent to exercise the
Exchange Right, and such request is denied by Alpha pursuant to Section 2.4.2.4,
to the extent any such Taxes accrue after such Exchange Notice is delivered to
Alpha and are required to be deducted from or in respect of amounts payable to
Conexant in respect of the Mexicali Note, Alpha shall pay to Conexant, in the
manner provided in Section 1 of the Notes, such amount as may be required so
that after making all required deductions for such Taxes, Conexant shall receive
an amount equal to the sum it would have received had no such deductions been
made.

9.16. FOREIGN SUBSIDIARIES. The provisions of this Agreement shall be binding
upon and enforceable against Obligors that are Foreign Subsidiaries (other than
Mexicali) and with respect to their property and assets only to the extent
permitted by applicable law of the jurisdiction in which any such Foreign
Subsidiary is organized.

               (remainder of this page intentionally left blank -
                             signature pages follow)


                                       58
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.

                                CONEXANT SYSTEMS, INC.


                                By:   /s/ Dennis E. O'Reilly
                                    -------------------------------------------
                                      Name:     Dennis E. O'Reilly
                                      Title:    Senior Vice President,
                                                General Counsel and Secretary



                                ALPHA INDUSTRIES, INC.,
                                      as an Obligor


                                By:   /s/ Paul E. Vincent
                                    -------------------------------------------
                                      Name:     Paul E. Vincent
                                      Title:    Vice President, Chief Financial
                                                Officer, Treasurer and Secretary



                                ALPHA INDUSTRIES LIMITED,
                                      as an Obligor


                                By:   /s/ Paul E. Vincent
                                    -------------------------------------------
                                      Name:     Paul E. Vincent
                                      Title:    Director



                                ALPHA SECURITIES CORPORATION,
                                      as an Obligor


                                By: /s/ Paul E. Vincent
                                    -------------------------------------------
                                      Name:     Paul E. Vincent
                                      Title:    Treasurer and Clerk



                                TRANS-TECH, INC.,
                                      as an Obligor


                                By:   /s/ Paul E. Vincent
                                    -------------------------------------------
                                      Name:     Paul E. Vincent
                                      Title:    Treasurer and Secretary
<PAGE>
                                AIMTA, INC.,
                                      as an Obligor



                                By:   /s/ Paul E. Vincent
                                    -------------------------------------------
                                      Name:     Paul E. Vincent
                                      Title:    Vice President, Treasurer
                                                and Secretary



<PAGE>

                                CFP HOLDING COMPANY, INC.,
                                      as an Obligor


                                By:   /s/ Paul E. Vincent
                                    -------------------------------------------
                                      Name:     Paul E. Vincent
                                      Title:    Treasurer and Secretary



<PAGE>

                                4067959 CANADA, INC.,
                                      as an Obligor


                                By:   /s/ Daniel N. Yannuzzi
                                    -------------------------------------------
                                      Name:     Daniel N. Yannuzzi
                                      Title:    Secretary



                                By:   /s/ Randolph F. LeVan, Jr.
                                    -------------------------------------------
                                      Name:     Randolph F. LeVan, Jr.
                                      Title:    President


<PAGE>
                                CONEXANT SYSTEMS, S.A. de C.V.,
                                      as an Obligor


                                By:   /s/ Paul E. Vincent
                                    -------------------------------------------
                                      Name:     Paul E. Vincent



<PAGE>
                                LEADERCO JAPAN KK,
                                      as an Obligor


                                By:   /s/ Mikio Hattori
                                    -------------------------------------------
                                      Name:     Mikio Hattori
                                      Title:    Representative Director







<PAGE>

                                LEADERCO WORLDWIDE, INC.,
                                      as an Obligor


                                By:   /s/ Daniel N.Yannuzzi
                                    -------------------------------------------
                                      Name:     Daniel N.Yannuzzi
                                      Title:    President and Secretary




<PAGE>
                                                                       EXHIBIT A



                                   DEFINITIONS


1.1. DEFINED TERMS. The following terms shall have the meanings set forth below:

                  "ACCOUNTS" shall have the meaning set forth in the UCC.

                  "ACCOUNTS RECEIVABLE" shall mean all Accounts and all right,
title and interest in any returned goods, together with all rights, titles,
securities and guarantees with respect thereto, including any rights to stoppage
in transit, replevin, reclamation and resales, and all related security
interests, liens and pledges, whether voluntary or involuntary, in each case
whether now existing or owned or hereafter arising or acquired.

                  "ACQUISITION NOTES" shall mean the Alpha Notes, the Mexicali
Note and the Exchange Note, if and when issued, individually and collectively.

                  "AFFILIATE" shall mean any person which, directly or
indirectly, is in control of, is controlled by, or is under common control with,
another person. For purposes of this definition, a person shall be deemed to be
"controlled by" another person if the latter possesses, directly or indirectly,
power either to (a) vote 50% or more of the securities (on a fully diluted
basis) having ordinary voting power for the election of directors or other
managing body of the former, or (b) direct or cause the direction of the
management and policies of the former, whether by contract or otherwise.
Notwithstanding the foregoing, no individual shall be deemed to be an Affiliate
of a person solely by reason of his or her being a director, officer or employee
of such person.

                  "AGREEMENT" shall mean this Financing Agreement, all Financing
Agreement Supplements, and all Exhibits and Schedules.

                  "ALPHA ASSET PURCHASE AGREEMENT" shall mean the U.S. Asset
Purchase Agreement, dated as of December 16, 2001, by and between Alpha and
Conexant, as amended by the Amendment No. 1 to the U.S. Asset Purchase
Agreement, dated as of June 25, 2002, by and between Alpha and Conexant, as the
same may be further amended, supplemented or modified from time to time.

                  "ALPHA EXCHANGE NOTE" shall mean the promissory note issued
pursuant to Section 2.4.4, substantially in the form annexed as Exhibit B-2,
duly completed in accordance with Section 2.4.4.2.

                  "ALPHA INDUSTRIES GMBH" shall mean Alpha Industries GmbH, a
company organized under the laws of Germany and Wholly-owned Subsidiary of
Alpha.
<PAGE>
                  "ALPHA FSC" shall mean Alpha FSC, Inc., a company organized
under the laws of Barbados.

                  "ALPHA NOTES" shall mean (i) the Stock Purchase Note, (ii) the
U.S. Asset Purchase Note and (iii) the Alpha Exchange Note, individually and
collectively.

                  "ALPHA OBLIGATIONS" shall mean (i) the payment when due
(whether at the stated maturity, by acceleration or otherwise) of principal of
and interest on each Revolving Loan and each of the Alpha Notes, and (ii) the
payment and performance of all obligations of Alpha under this Agreement and the
other Financing Documents.

                  "ALPHA STOCK PURCHASE AGREEMENT" shall mean the Mexican Stock
Purchase Agreement, dated as of June 25, 2002, by and between Alpha and
Conexant, as the same may be amended, supplemented or modified from time to
time.

                  "APPLICABLE RATE" shall mean, with respect to any Revolving
Loan and any Acquisition Note, a per annum rate of interest equal to:

                  (i) for the period commencing on (and including) the Closing
                  Date to (but excluding) the 90th day following the Closing
                  Date, ten percent (10%);

                  (ii) for the period commencing on (and including) the 90th day
                  following the Closing Date to (but excluding) the 180th day
                  following the Closing Date, twelve percent (12%); and

                  (iii) for the period commencing on (and including) the 180th
                  day following the Closing Date to (but excluding) the Maturity
                  Date, fifteen percent (15%).

                  "ASSET SALE" shall mean the sale, transfer or other
disposition (by way of merger or otherwise and including by way of a sale and
leaseback) by Alpha or any of its Subsidiaries to any person of (a) any capital
stock of any Subsidiary (other than directors' qualifying shares) or (b) any
other assets of Alpha or any of its Subsidiaries.

                  "AVAILABILITY PERIOD" shall mean the period commencing on July
10, 2002 and ending on the Expiration Date.

                  "AVAILABLE CASH" shall mean, at any time, the aggregate
amount, determined on a consolidated basis for Alpha and its Subsidiaries, of
all cash, cash equivalents and marketable securities held by Alpha and its
Subsidiaries, as shown on its most recent monthly balance sheet as of the time
any determination of Available Cash is required to be made.

                  "BANK ACCOUNT CONTROL AGREEMENT" shall mean the Bank
Collateral Account Agreement among Alpha or any Alpha Subsidiary, Conexant, and
each bank depositary of Alpha or any Alpha Subsidiary, in form and substance
reasonably satisfactory to each party thereto in respect of the Deposit Accounts
listed in Schedule 5.2.1 and Schedule 1 of any Financing Agreement Supplement.


                                       2
<PAGE>
                  "BANKRUPTCY EVENT" shall mean any event of the type set forth
in clause (e) or (f) of the definition of Event of Default.

                  "BORROWER ACCOUNT" shall mean Alpha's account set forth below
or such other bank account of Alpha as Alpha may from time to time designate in
a written notice to Conexant.

Bank Name:                 Fleet Bank, 100 Federal Street, Boston, MA  02110
ABA#                       011-000-138
Account No.                0058269168
Beneficiary Name:          Alpha Industries, Inc.

                  "BUSINESS DAY" shall mean any day other than a Saturday,
Sunday or other day when banks are authorized or required to be closed in
California, Massachusetts or Michigan and, in the case of any payment required
to be made by or to Mexicali, Mexico.

                  "CAPITAL EXPENDITURES" shall mean, for any period, the
aggregate, without duplication, of all expenditures (whether paid in cash or
other consideration or accrued as a liability) by Alpha or any of its
Subsidiaries during such period (or, in the case of a newly formed or acquired
Subsidiary, during the portion of such period when such person was a Subsidiary)
that, in accordance with GAAP, are includible in "additions to property, plant
and equipment" or similar items reflected in the consolidated statement of cash
flows of Alpha and its Subsidiaries for such period (or, in the case of a newly
formed or acquired Subsidiary, during the portion of such period when such
person was a Subsidiary) including expenditures for assets leased by Alpha or
any of its Subsidiaries under Capital Lease Obligations to the extent classified
as Capital Lease Obligations.

                  "CAPITAL LEASE OBLIGATIONS" shall mean as to any person, the
obligations of such person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.

                  "CHANGE OF CONTROL" shall be deemed to have occurred if: (A)
any person or group (within the meaning of Rule 13d-5 of the Securities Exchange
Act of 1934, as in effect on the date hereof, shall own, directly or indirectly,
beneficially or of record, shares representing more than 25% of the aggregate
ordinary voting power represented by the issued and outstanding capital stock of
Alpha, or (B) the Continuing Directors shall at any time cease to constitute a
majority of the board of directors of Alpha.

                  "CHATTEL PAPER" shall have the meaning set forth in the UCC.

                  "CLOSING CERTIFICATE" shall mean a certificate issued by an
authorized executive officer of Alpha and each Alpha Subsidiary, substantially
in the form annexed as

                                       3
<PAGE>
Exhibit C-1 duly completed in respect of each Alpha Subsidiary that was a
Subsidiary of Washington immediately prior to the Merger and substantially in
the form annexed as Exhibit C-2 duly completed in respect of all other Obligors.

                  "CLOSING DATE" shall mean June 25, 2002 or such other date as
may be agreed in writing by Conexant and Alpha.

                  "COLLATERAL" shall mean, with respect to any Obligor, all of
the property and assets (tangible and intangible) of every kind in which such
Obligor has any right, title or interest, now existing or hereafter acquired,
including all of such Obligor's (a) Accounts Receivable, (b) Documents, (c)
Equipment, (d) General Intangibles (including Payment Intangibles and
Contracts), (e) Inventory, (f) Deposit Accounts, (g) Supporting Obligations, (h)
Letter of Credit Rights, (i) Software, (j) Chattel Paper, (k) Commercial Tort
Claims, (l) Instruments, (m) Investment Property, (n) cash and cash accounts,
(o) letters of credit, (p) Goods, (q) Pledged Securities, (r) Intellectual
Property and (s) without duplication, Proceeds; provided, that the Collateral
shall not include Excluded Property.

                  "COLLATERAL ASSIGNMENT OF LEASES" shall mean those certain
collateral assignment of lease agreements, dated as of the Closing Date for the
leased properties set forth in Schedule II.

                  "COMMERCIAL TORT CLAIMS" shall have the meaning set forth in
the UCC.

                  "COMMODITY ACCOUNT", "COMMODITY CONTRACT", "COMMODITY
CUSTOMER" and "COMMODITY INTERMEDIARY" shall have the meanings set forth in the
UCC.

                  "COMPETITOR OF ALPHA" shall mean any person, other than
Conexant or any Subsidiary, division or business unit of Conexant (including
Mindspeed), which derives more than 10% of its revenues from any businesses as
are conducted by Alpha and its Subsidiaries.

                  "COMPLIANCE CERTIFICATE" shall mean a certificate issued by
Alpha, substantially in the form annexed as Exhibit D duly completed.

                  "CONTINGENT OBLIGATION" shall mean, as to any person, any
direct or indirect liability of that person, whether or not contingent, with or
without recourse, (a) with respect to any Indebtedness, lease, dividend, letter
of credit or other obligation (the "PRIMARY OBLIGATIONS") of another person (the
"PRIMARY OBLIGOR"), including any obligation of that person (i) to purchase,
repurchase or otherwise acquire such primary obligations or any security
therefor, (ii) to advance or provide funds for the payment or discharge of any
such primary obligation, or to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation, or (iv)
otherwise to assure or hold harmless the holder of any such primary obligation
against loss in respect

                                       4
<PAGE>
thereof (each, a "GUARANTY OBLIGATION"); (b) with respect to any surety
instrument (other than any letter of credit) issued for the account of that
person or as to which that person is otherwise liable for reimbursement of
drawings or payments; and (c) with respect to any Hedging Agreement. The amount
of any Contingent Obligation shall be deemed equal to (x) in the case of any
Guaranty Obligation, the stated or determinable amount of the primary obligation
in respect of which such Contingent Obligation is made, or if not stated or if
indeterminable, the reasonably anticipated maximum liability in respect thereof,
and (y) in the case of any other Contingent Obligation, the reasonably
anticipated maximum liability in respect thereof.

                  "CONTINUING DIRECTOR" shall mean any member of Alpha's board
of directors who either (i) is a member of such board as of the Closing Date or
(ii) is thereafter elected to such board, or nominated for election by
stockholders, by a vote of at least two-thirds of the directors at the time of
such vote who are Continuing Directors.

                  "CONTRACTS" shall mean all contracts, leases and agreements
(other than Licenses) between any Obligor and one or more additional parties.

                  "CONTRIBUTION AGREEMENT" shall mean the Contribution and
Distribution Agreement, dated as of December 16, 2001, as amended as of June 25,
2002, by and between Conexant and Washington.

                  "COPYRIGHT LICENSE" shall mean any written agreement, now or
hereafter in effect, granting any right to any third party under any Copyright,
now or hereafter owned, by any Obligor or which such Obligor otherwise has the
right to license, or granting any right to such Obligor under any Copyright, now
or hereafter owned, by any third party, and all rights of such Obligor under any
such agreement.

                  "COPYRIGHTS" shall mean all of the following now owned or
hereafter acquired by any Obligor: (a) all copyright rights in any work subject
to the copyright laws of the United States, whether as author, assignee,
transferee or otherwise, whether statutory or common law, whether or not the
underlying works of authorship have been published, and all copyrights of works
based on, incorporated in, derived from or relating to works covered by such
copyrights, all right, title and interest to make and exploit all derivative
works based on or adopted from works covered by such copyrights, and (b) all
registrations and applications for registration of any such copyright in the
United States, including registrations, recordings, supplemental registrations
and pending applications for registration in the United States Copyright Office.
Copyrights shall include, without limitation, (i) the right to print, publish
and distribute any of the foregoing, (ii) the right to sue or otherwise recover
for any and all past, present and future infringements and misappropriations
thereof, and (iii) all income, royalties, damages and other payments now and
hereafter due and/or payable with respect thereto (including, without
limitation, payments under all Copyright Licenses entered into in connection
therewith, and damages and payments for past or future infringements thereof).


                                       5
<PAGE>
                  "DEFAULT" shall mean any event which, with notice or lapse of
time, or both, would constitute an Event of Default.

                  "DEPOSIT ACCOUNTS" shall have the meaning set forth in the UCC
and shall include the accounts listed on Schedule 5.2.1 and Schedule 1 of any
Financing Agreement Supplement.

                  "DOCUMENTS" shall have the meaning set forth in the UCC.

                  "DOMESTIC SUBSIDIARIES" shall mean all Subsidiaries
incorporated or organized under the laws of the United States of America, any
state thereof or the District of Columbia.

                  "ELIGIBLE RECEIVABLES" shall mean the Accounts Receivable set
forth in Schedule I.

                  "ELECTRONIC CHATTEL PAPER" shall have the meaning set forth in
the UCC.

                  "EQUIPMENT" shall have the meaning set forth in the UCC and,
in any event, shall include, but shall not be limited to, all machinery,
equipment, furnishings, fixtures and vehicles, now or hereafter owned by any
Obligor, and any and all additions, substitutions and replacements of any of the
foregoing, wherever located, together with all attachments, components, parts,
equipment and accessories installed thereon or affixed thereto.

                  "EVENT OF DEFAULT" shall mean the occurrence of any one or
more of the following:

         (a) any representation or warranty made herein or in any other
         Financing Document by any Obligor shall prove to have been false or
         misleading in any material respect when so made or furnished; or

         (b) Alpha or Mexicali shall fail to pay (i) any installment of
         principal when the same may become due and payable under any Revolving
         Loans or any of the Notes or (ii) any installment of interest under any
         Revolving Loans or any of the Notes or any other amount (other than an
         amount referred to in clause (i)) when the same shall have become due
         and payable under any Financing Document and such failure shall
         continue unremedied for a period of five (5) days; or

         (c) any Obligor (other than Alpha) shall fail to pay any Obligation
         guarantied under this Agreement within five (5) days after demand for
         payment by Conexant; or

         (d) any Obligor shall fail to observe or perform any of the covenants,
         conditions or agreements contained in this Agreement or any other
         Financing Document (other than those referred to in clause (b) or (c)
         above) for a period of thirty (30) days after written notice shall have
         been given by Conexant to Alpha specifying such failure and requiring
         Alpha to remedy the same; or


                                       6
<PAGE>
         (e) any Obligor or any of its Subsidiaries shall become insolvent or
         generally fail to pay, or admit in writing its inability to pay, its
         debts as they become due, or shall voluntarily commence any proceeding
         or file any petition under any bankruptcy, insolvency or similar
         federal, state or foreign law or seeking dissolution, liquidation or
         reorganization or the appointment of a receiver, trustee, custodian or
         liquidator for it or a substantial portion of its property, assets or
         business or to effect a plan or other arrangement with its creditors,
         or shall file any answer admitting the jurisdiction of the court and
         the material allegations of an involuntary petition filed against it in
         any bankruptcy, insolvency or similar proceeding, or shall be
         adjudicated bankrupt, or shall make a general assignment for the
         benefit of creditors, or shall consent to, or acquiesce in the
         appointment of, a receiver, trustee, custodian or liquidator for a
         substantial portion of its property, assets or business, or shall by
         any act or failure to act indicate its consent to or approval of any of
         the foregoing, or if any corporate action is taken by the Obligor or
         any of its Subsidiaries for the purpose of effecting any of the
         foregoing; or

         (f) involuntary proceedings or an involuntary petition shall be
         commenced or filed against any Obligor or any of its Subsidiaries under
         any bankruptcy, insolvency or similar federal, state or foreign law or
         seeking the dissolution, liquidation or reorganization of it or the
         appointment of a receiver, trustee, custodian or liquidator for it or
         of a substantial part of its property, assets or business, and such
         proceedings or petition shall not be dismissed within sixty (60) days;
         or any writ, judgment, tax lien, warrant of attachment, execution or
         similar process shall be issued or levied against a substantial part of
         its property, assets or business, and such writ, judgment, lien,
         warrant of attachment, execution or similar process shall not be
         released, vacated or fully bonded, within sixty (60) days after
         commencement, filing or levy, as the case may be, or any order for
         relief shall be entered in any such proceeding; or any winding-up,
         dissolution, liquidation or reorganization of any Obligor or any of its
         Subsidiaries; or

         (g) this Agreement, any Note or any Security Document (other than any
         Foreign Pledge Agreement) shall cease to be in full force and effect or
         any Obligor shall so assert in writing; or

         (h) the Financing Documents shall cease to give Conexant the liens,
         rights, powers and privileges purported to be created thereby,
         including, to the extent acquired, a valid, perfected, first priority
         (except as otherwise provided by this Agreement) security interest in,
         and lien on, any material portion of the securities, assets or
         properties covered thereby, except to the extent any such loss of
         perfection or priority results from the failure of Conexant to maintain
         possession of certificates representing securities pledged herein and
         except to the extent that such loss is covered by a lender's title
         insurance policy and the related insurer promptly after such loss shall
         have acknowledged in writing that such loss is covered by such title
         insurance policy; or


                                       7
<PAGE>
         (i) any Obligor or any of its Subsidiaries shall fail to pay any
         principal of or interest on any indebtedness for borrowed money that is
         outstanding in principal amount of at least $1,000,000 in the aggregate
         of such Obligor or such Subsidiary, when the same becomes due and
         payable (whether by scheduled maturity, mandatory prepayment,
         acceleration, demand or otherwise), and such failure shall continue
         after the applicable grace period, if any, specified in the agreement
         or instrument relating to such indebtedness; or any other event shall
         occur or condition shall exist under any agreement or instrument
         relating to such indebtedness and shall continue after the applicable
         grace period, if any, specified in such agreement or instrument, if the
         effect of such event or condition is to accelerate, or to permit the
         acceleration of, the maturity of such indebtedness; or any such
         indebtedness shall be declared to be due and payable, or required to be
         prepaid (other than by a regularly scheduled required prepayment),
         redeemed, purchased or defeased, or an offer to prepay, redeem,
         purchase or defease such indebtedness shall be required to be made, in
         each case prior to the stated maturity thereof; or

         (j) one or more judgments or orders for the payment of money which is
         not covered by insurance and, in the aggregate, is in excess of
         $10,000,000 shall be rendered against any Obligor or any of its
         Subsidiaries and the same shall remain undischarged for a period of
         thirty (30) consecutive days during which a stay of enforcement of such
         judgment or order shall not be in effect, or any action shall be
         legally taken by a judgment creditor to levy upon assets or properties
         of any of the Obligors or their Subsidiaries to enforce such judgment;
         or

         (k) there shall have occurred a Change of Control; or

         (l) there shall have occurred a liquidation, dissolution or winding up
         of any of the Obligors or their Subsidiaries or any corporate action is
         taken by any Obligor or any of its Subsidiaries for the purpose of
         effecting any of the foregoing.

                  "EXCESS CASH" shall mean, for any month, the amount by which
(x) Available Cash exceeds (y) $60,000,000, as of the close of business on the
last Business Day of the month.


                  "EXCESS CASH PAYMENT DATE" shall mean the date occurring 10
Business Days after the last day of each calendar month.


                  "EXCHANGE NOTICE" shall mean the notice exercising the
Exchange Right, substantially in the form annexed as Exhibit F, appropriately
completed in accordance with Section 2.4.3.

                  "EXCHANGE RIGHT" shall have the meaning set forth in Section
2.4.

                  "EXCLUDED LICENSES" shall mean various technology Licenses,
cross Licenses comprising covenants not to sue, and so-called reusable IP
Licenses which contain provisions

                                       8
<PAGE>
prohibiting the grant hereunder of a security interest therein without the
consent of other persons.

                  "EXCLUDED LOSS" shall mean any Loss caused by any
circumstance, event or condition, existing as of the Closing Date, that affects
any property directly or indirectly acquired by Alpha in the Merger or pursuant
to the Purchase Documents, including any Lien on any such property, any
liability associated with the ownership or control of such property (under
environmental laws or otherwise), or any claim that the transfer of any such
property to Alpha violated any applicable law, rule, regulation, order or
Contract binding on any such property, Conexant or any Subsidiary of Conexant.

                  "EXCLUDED PROPERTY" shall mean (i) the Contracts which contain
provisions prohibiting the grant hereunder of a security interest therein
without the consent of other persons ("EXCLUDED CONTRACT"), and (ii) Excluded
Licenses; provided that to the extent that any necessary consent is obtained to
grant a security interest in any such Excluded Contract and/or Excluded License,
such Excluded Contract and/or Excluded License, as the case may be, shall no
longer constitute Excluded Property and shall become Collateral hereunder;
provided, however, that notwithstanding the foregoing, all rights to payment for
money due or to become due pursuant to any such Excluded Contract or Excluded
License shall be subject to the security interests created by this Agreement.

                  "EXCLUDED SUBSIDIARY" shall mean (i) Alpha Industries GmbH and
(ii) Alpha FSC, Inc.

                  "EXPIRATION DATE" means the first to occur of (i) the date 364
calendar days after the Closing Date, and (ii) any date on which the Commitments
are terminated in accordance with the provisions of this Agreement.

                  "FIANZA" shall mean that certain General Continuing Guaranty
Agreement, that is enforceable under the laws of Mexico, executed and delivered
in favor of Conexant by Mexicali, and in form and substance satisfactory to
Conexant.

                  "FINANCING AGREEMENT SUPPLEMENT" shall mean the instrument
annexed as Exhibit E duly completed in accordance with Section 9.11 of this
Agreement.

                  "FINANCING DOCUMENTS" shall mean this Agreement, the Security
Documents, any Financing Agreement Supplement, the Alpha Notes, the Revolving
Note, the Mexicali Note, the Closing Certificate, any Compliance Certificate,
and any other document, instrument or certificate required by this Agreement or
any Security Document to be delivered to Conexant by or on behalf of any
Obligor, individually and collectively.

                  "FIXTURES" shall have the meaning set forth in the UCC.

                  "FOREIGN PLEDGE AGREEMENTS" shall mean (i) the Mexicali Stock
Pledge Agreement, (ii) the Share Mortgage referred to in Section 2.3.9.7, (iii)
the Statement of Pledge

                                       9
<PAGE>
of Share Account Declaration and (iv) the Certificate of Pledge referred to in
Section 2.3.9.3, individually and collectively.

                  "FOREIGN SUBSIDIARY" shall mean any Subsidiary that is not a
Domestic Subsidiary.

                  "GAAP" shall mean United States generally accepted accounting
principles as in effect from time to time.

                  "GENERAL INTANGIBLES" shall have the meaning set forth in the
UCC.

                  "GOODS" shall have the meaning set forth in the UCC.

                  "GOVERNMENTAL AUTHORITY" shall mean any nation or government,
any state or other political subdivision thereof, and any federal, state, local
or foreign court or governmental, executive, legislative, judicial,
administrative or regulatory agency, department, authority, instrumentality,
commission, board or similar body.

                  "GUARANTY" shall mean the guaranty of the Obligations set
forth in Section 3 of this Agreement.

                  "GUARANTOR" shall mean Alpha, each Alpha Subsidiary and each
person that becomes an Obligor pursuant to Section 9.11 of this Agreement,
individually and collectively.

                  "HEDGING AGREEMENT" shall mean any interest rate, currency, or
commodity swap agreement, exchange agreement, hedging arrangement or similar
agreement or arrangement designed to protect against fluctuations in interest
rates, currency exchange rates or commodity prices, including any futures
contract, forward contract or option agreement.

                  "INDEBTEDNESS" shall mean, as to any person, without
duplication, (a) all indebtedness of such person (i) evidenced by any notes,
bonds, debentures or similar instruments made or issued by such person, (ii) for
borrowed money, or (iii) for the deferred purchase price of property or
services, (b) the face amount of all letters of credit or banker's acceptances
issued for the account of such person, (c) all indebtedness secured by any Lien
on any property owned by such person, whether or not such indebtedness has been
assumed by such person, (d) the aggregate amount of Capital Lease Obligations,
(e) all repurchase obligations of such person pursuant to which such person has
agreed to repurchase on a future date properties or assets previously
transferred by it, for a specified price, (f) all Contingent Obligations of such
person with respect to the Indebtedness of others, (g) all obligations of such
person in respect of Hedging Agreements, and (h) all obligations under any
"synthetic leases" or in respect of any "minority interest" in a person
primarily engaged in financing activities, excluding, however, from each of
clauses (a) through (h) inclusive (1) all accounts payable and accrued
obligations incurred in the ordinary course of business, due and payable within
90 days of the earlier of shipment and invoice and accounted for as current
liabilities, or, if such obligations are past due, to the extent the same are
being disputed in good faith by appropriate proceedings so long as adequate
reserves are maintained therefor in accordance

                                       10
<PAGE>
with GAAP, and (2) obligations under leases, excluding in all cases for the
purposes of this clause (2), any "synthetic leases", which are, in accordance
with GAAP, accounted for as operating leases. The Indebtedness of any person
shall include the Indebtedness of any partnership in which such person is a
general partner, solely to the extent such Indebtedness is recourse to such
person or all or a portion of such person's assets either expressly, by
operation of law or otherwise.

                  "INDEMNITEE" shall have the meaning set forth in Section 8.1
of this Agreement.

                  "INSTRUMENT" shall have the meaning set forth in the UCC.

                  "INTELLECTUAL PROPERTY" shall mean all intellectual and
similar property of any Obligor of every kind and nature, including inventions,
designs, Patents, Copyrights, Licenses, Trademarks, trade secrets, confidential
or proprietary technical and business information, know-how, show-how or other
data or information, software and databases and all embodiments or fixations
thereof and related documentation, registrations and franchises, and all
additions, improvements and accessions to, and books and records describing or
used in connection with, any of the foregoing.

                  "INVENTORY" shall have the meaning set forth in the UCC.

                  "INVESTMENT" means any investment in any Person, whether by
means of an acquisition of securities, share capital, partnership, joint venture
or other equity investment, capital contribution, profit sharing arrangement,
loan, guarantee, advance, deposit or otherwise.

                  "INVESTMENT PROPERTY" shall have the meaning set forth in the
UCC.

                  "LETTER OF CREDIT RIGHTS" shall have the meaning set forth in
the UCC.

                  "LICENSE" shall mean any Patent License, Trademark License,
Copyright License or other license or sublicense to which any Obligor is a
party.

                  "LIENS" shall mean any security interest, mortgage, pledge,
hypothecation, lien, claim, charge, encumbrance, title retention agreement,
lessor's interest in a financing lease or analogous instrument, in, of, or on
any Obligor's property, and any option, warrant, purchase or subscription right,
transfer restriction or other encumbrance on any capital stock of any Subsidiary
of Alpha.

                  "LOSS" shall have the meaning set forth in Section 8.1.

                  "MARGIN STOCK" shall have the meaning set forth in Regulation
U of the Board of Governors of the Federal Reserve System as from time to time
in effect.


                                       11
<PAGE>
                  "MATERIAL ADVERSE EFFECT" means any event, condition or
circumstance which materially and adversely affects (i) the business,
operations, properties or condition (financial or other) of Alpha and its
Subsidiaries, taken as a whole, or (ii) the ability of any Obligor to perform
its obligations under the Financing Documents or (iii) the rights or remedies of
Conexant under any of the Financing Documents or (iv) the perfection or priority
of any Lien on any item of Collateral granted by any of the Security Documents
from that in effect on the Closing Date or (v) the legality, validity or
enforceability of any provision in any of the Financing Documents from that in
effect on the Closing Date.

                  "MATERIAL ITEM" shall mean any property that is Collateral
except for any particular property that (x) is not material to the business,
operations or condition (financial or other) of any Obligor and (y) has a book
value of less than $100,000.

                  "MATURITY DATE" shall mean the date 364 calendar days after
the Closing Date.

                  "MERGER" shall mean the merger of Washington with and into
Alpha pursuant to the Merger Agreement.

                  "MERGER AGREEMENT" shall mean the Agreement and Plan of
Reorganization, dated as of December 16, 2001, as amended as of April 12, 2002,
by and among Conexant, Alpha and Washington.

                  "MEXICALI ASSET PURCHASE AGREEMENT" shall mean the Amended and
Restated Mexican Asset Purchase Agreement, dated as of June 25, 2002, by and
between Alpha and Conexant, as the same may be amended, supplemented or modified
from time to time.

                  "MEXICALI NOTE" shall mean the promissory note issued by
Mexicali to Conexant pursuant to Section 2.4 of the Mexicali Asset Purchase
Agreement, in the form annexed as Exhibit B-4.

                  "MEXICALI OBLIGATIONS" shall mean (i) the payment when due
(whether at the stated maturity, by acceleration or otherwise) of principal of
and interest on the Mexicali Note, and (ii) the payment and performance of all
obligations of Mexicali under the Mexican Security Documents.

                  "MEXICAN MORTGAGES" shall mean that certain Mortgage
Agreement, dated as of the Closing Date, in the form annexed as Exhibit H.

                  "MEXICAN SECURITY DOCUMENTS" shall mean the Mexican Mortgages,
the Fianza, the Mexican Stock Pledge Agreement, and each document or instrument
provided pursuant to Section 2.4.7 from time to time.

                  "MEXICAN STOCK PLEDGE AGREEMENT" shall mean that certain Stock
Pledge Agreement by and among Alpha, LeaderCo Worldwide, Inc., Mexicali and
Conexant in the form annexed as Exhibit I.


                                       12
<PAGE>
                  "NET CASH PROCEEDS" shall mean (a) with respect to any Asset
Sale, the cash proceeds (including cash proceeds subsequently received (as and
when received) in respect of non-cash consideration initially received and
including all insurance settlements and condemnation awards from any single
event or series of related events), net of transaction expenses (including
reasonable broker's fees or commissions, legal fees, accounting fees, investment
banking fees and other professional fees, and transfer and similar taxes) and
(b) with respect to any creation or incurrence of Indebtedness, the issuance or
sale of capital stock of Alpha or its Subsidiaries, the cash proceeds thereof,
net of all taxes and customary fees, commissions, costs and other expenses
(including reasonable broker's fees or commissions, legal fees, accounting fees,
investment banking fees and other professional fees, and underwriter's discounts
and commissions) incurred in connection therewith.

                  "NOTES" shall mean the Acquisition Notes and the Revolving
Note, if issued, individually and collectively.

                  "NOTICE OF BORROWING" means a notice, substantially in the
form annexed as Exhibit K, appropriately completed in conformity with Section
2.1.3.

                  "OBLIGATIONS" shall mean (i) the Alpha Obligations; (ii) the
Mexicali Obligations; (iii) the full and prompt payment when due (whether at the
stated maturity, by acceleration or otherwise) of all obligations and
indebtedness (including, without limitation, indemnities, fees and interest
thereon) of each Obligor to Conexant, whether now existing or hereafter incurred
under, arising out of, or in connection with this Agreement and the other
Financing Documents (including, in the case of each Alpha Subsidiary, all such
obligations and indebtedness under the Guaranty) and the due performance and
compliance by such Obligor with all of the terms, conditions and agreements
contained in this Agreement and the other Financing Documents; (iv) any and all
sums advanced by Conexant in order to preserve the Collateral or preserve its
security interest in the Collateral; (v) in the event of any proceeding for the
collection or enforcement of any indebtedness, obligations or liabilities of
such Obligor referred to in clause (i) or (ii) above, after an Event of Default
shall have occurred and be continuing, the reasonable expenses of retaking,
holding, preparing for sale or lease, selling or otherwise disposing of or
realizing on the Collateral, or of any exercise by Conexant of its rights
hereunder, together with reasonable attorneys' fees and court costs; and (iv)
all amounts paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement under Section 8.1 of this Agreement.

                  "OBLIGORS" shall mean Alpha, the Alpha Subsidiaries and any
person that becomes an Obligor pursuant to Section 9.11 of this Agreement,
individually and collectively.

                  "PATENT LICENSE" shall mean any written agreement, now or
hereafter in effect, granting to any third party any right to make, use, sell,
offer for sale, or import any invention on which a Patent, now or hereafter
owned by any Obligor or which any Obligor otherwise has the right to license, is
in existence, or granting to any Obligor any right to make, use, sell, offer for
sale, or import any invention on which a Patent, now or hereafter owned by any
third party, is in existence, and all rights of any Obligor under any such
agreement.


                                       13
<PAGE>
                  "PATENTS" shall mean all of the following now owned or
hereafter acquired by any Obligor: (a) all letters patent of the United States,
all registrations and recordings thereof, and all applications for letters
patent of the United States, including registrations, recordings and pending
applications in the United States Patent and Trademark Office, and (b) all
reissues, continuations, divisions, continuations-in-part, provisionals,
substitutes, renewals or extensions thereof, and the inventions disclosed or
claimed therein, including the right to make, use, sell, offer for sale and/or
import the inventions disclosed or claimed therein. Patents shall include
without limitation (i) all inventions and improvements described or claimed
therein, (ii) the right to sue or otherwise recover for any infringements or
misappropriations thereof, and (iii) all income, royalties, damages and other
payments now and hereinafter due and/or payable with respect thereto (including,
without limitation, patents under all Patent Licenses entered into in connection
therewith, and damages and payments for past and future infringements thereof).

                  "PAYMENT INTANGIBLES" shall have the meaning set forth in the
UCC.

                  "PERMITTED INVESTMENTS" shall mean, as to any person, (a)
Investments made by Alpha in accordance with its Investment Policy as adopted by
Alpha in January, 2000 (as the same may be amended from time to time with the
approval of Conexant); provided, that no Investments denominated in any currency
other than United States dollars other than foreign currency deposits held in
bank accounts of Foreign Subsidiaries to fund current operations in the normal
course of business shall be made during the term of this Agreement without
Conexant's prior written consent; (b) Investments existing on the date hereof
and any other Investments that may be distributed thereon or in exchange or
conversion thereof or in substitution therefor; (c) Capital Expenditures to the
extent permitted by this Agreement; (d) cash collateral provided to Conexant
pursuant to the Financing Documents; (e) Contingent Obligations of any person,
acquired in the ordinary course of business; (f) Investments (including debt
obligations) received in connection with the bankruptcy or reorganization of
suppliers and customers and in good faith settlement of delinquent obligations
of, and other disputes with, customers and suppliers arising in the ordinary
course of business; (g) intercompany loans and advances to a Subsidiary of Alpha
to fund working capital needs incurred in the ordinary course of business
consistent with past practice; provided that the aggregate amount of such
Investments made after the Closing Date in any Excluded Subsidiary or Restricted
Subsidiary shall be subject to the limitations in Section 7.18; (h) Investments
consisting of Hedging Agreements entered into in the ordinary course of business
consistent with past practice and not for the purpose of speculation; (i)
capital stock of any Person that is a Subsidiary of any Obligor on the Closing
Date, after giving effect to the Merger and the Purchase Documents; (j) loans or
advances from any Obligor or its Subsidiaries to its directors, officers and
employees in the ordinary course of business consistent with past practice and
(k) accounts payable (or advances or extensions of credit to customers payable
within 90 days for inventory or services purchased from any Obligor) arising in
the ordinary course of business.

                  "PERMITTED LIENS" shall mean (i) Liens for taxes, assessments
and governmental charges or levies on property not yet due and payable or which
are being

                                       14
<PAGE>
contested in good faith and for which appropriate reserves are maintained, (ii)
Liens imposed by law, such as landlords', materialmen's, mechanics', carriers',
workmen's and repairmen's Liens and other similar Liens arising in the ordinary
course of business securing obligations that are not overdue for a period of
more than thirty (30) days, (iii) pledges or deposits to secure obligations
under workers' compensation laws or similar legislation, to secure the
performance of bids, trade contracts (other than Indebtedness), leases (other
than Capital Lease Obligations), letters of credit, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business or to secure public or statutory obligations, not to
exceed $10,000,000 at any one time outstanding, (iv) Liens in favor of customs
and revenue authorities arising as a matter of law to secure payment of customs
duties in connection with the importation of goods, (v) Liens for Purchase Money
Indebtedness or Capital Lease Obligations, provided such Indebtedness is
permitted by the terms of this Agreement and the Lien applies only to the
property that is acquired with the proceeds of the Purchase Money Indebtedness
or is leased pursuant to such Capital Lease Obligation (or proceeds of such
acquired property), (vi) Liens expressly permitted or granted by the Financing
Documents, (vii) Liens on property acquired pursuant to the Purchase Documents
which existed at the time such property was acquired, (viii) Liens on property
of the successor entity to Washington, any Subsidiary of the Washington
successor or Mexicali which existed prior to the Merger or resulted from the
Spin-Off, the Merger or the Purchase Transactions, (ix) the Liens set forth in
Schedule III hereto, (x) easements, rights of way, zoning restrictions,
encroachments and other minor defects or irregularities in title, in each case
which do not (1) evidence or secure Indebtedness or any other monetary
obligation, and (2) will not make the real property unmarketable or interfere in
any material respect with the ordinary conduct of the business of Alpha and its
Subsidiaries at the real property so encumbered, (xi) any interest or title of a
lessor or sublessor under any lease of real estate permitted under the Financing
Documents, (xii) Liens arising from the rendering of a final judgment or order
that does not give rise to an Event of Default or other similar Liens (not
exceeding $10,000,000 in the aggregate) arising in connection with legal
proceedings so long as the execution or other enforcement thereof is effectively
stayed and the claims secured thereby are being contested in good faith by
appropriate proceedings and such Obligor has established appropriate reserves
against such claims in accordance with GAAP, (xiii) Liens securing Refinancing
Indebtedness permitted in accordance with Section 7.12, (xiv) bank setoff rights
arising in the ordinary course of business, and (xv) any extension, renewal or
replacement (or successive extension, renewal, or replacement) in whole or in
part, of any Lien referred to in the foregoing clauses (i) through (xiv)
inclusive; provided, however, that the principal amount of the Indebtedness or
other obligation secured thereby shall not exceed the principal amount of the
Indebtedness or other obligation so secured at the time of such extension,
renewal or replacement, and that such extension, renewal or replacement shall be
limited to all or a part of the property which secured the Lien so extended,
renewed or replaced (plus improvements on such property).

                  "PERSON" shall mean any individual, partnership, limited
partnership, company, joint venture, firm, corporation, sociedad anonima,
association, trust or other enterprise or any government or political
subdivision or any agency, department or instrumentality thereof.


                                       15
<PAGE>
                  "PLEDGED SECURITIES" shall mean any and all Pledged Stock or
any other Security now or hereafter included in the Collateral and shall include
those set forth on Schedule 5.2.1 and Schedule 1 of any Financing Agreement
Supplement.

                  "PLEDGED STOCK" shall mean the shares of capital stock of each
direct or indirect Subsidiary of Alpha owned by Alpha or any Subsidiary other
than the Excluded Subsidiaries, including any and all certificates and other
instruments now or hereafter evidencing any such capital stock and shall include
those set forth on Schedule 5.2.1 and Schedule 1 of any Financing Agreement
Supplement.

                  "PROCEEDS" shall have the meaning provided in the UCC or under
other relevant law and, in any event, shall include, but not be limited to, (i)
any and all proceeds of any insurance, indemnity, warranty or guaranty payable
to Conexant or any Obligor from time to time with respect to any of the
Collateral, (ii) any and all payments (in any form whatsoever) made or due and
payable to any Obligor from time to time in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the
Collateral by any governmental authority (or any person acting under color of
governmental authority), (iii) any and all other amounts from time to time paid
or payable under, or in connection with, any of the Collateral, including from
the sale, exchange, license, lease or other disposition of any asset or property
that constitutes Collateral, any value received as a consequence of the
possession of any Collateral and any payment received from any insurer or other
person or entity as a result of the destruction, loss, theft, damage or other
involuntary conversion of whatever nature of any asset or property which
constitutes Collateral, and shall include (a) all cash and negotiable
instruments received by or held on behalf of Conexant, (b) any claim of any
Obligor against any third party for (and the right to sue and recover for and
the rights to damages or profits due or accrued arising out of or in connection
with) (w) past, present or future infringement of any Patent now or hereafter
owned by any Obligor, or licensed under a Patent License, (x) past, present or
future infringement or dilution of any Trademark now or hereafter owned by any
Obligor or licensed under a Trademark License or injury to the goodwill
associated with or symbolized by any Trademark now or hereafter owned by any
Obligor, (y) past, present or future breach of any License, and (z) past,
present or future infringement of any Copyright now or hereafter owned by any
Obligor or licensed under a Copyright License.

                  "PURCHASE DOCUMENTS" shall mean the Alpha Asset Purchase
Agreement, the Alpha Stock Purchase Agreement and the Mexicali Asset Purchase
Agreement, individually and collectively.

                  "PURCHASE MONEY INDEBTEDNESS" shall mean any Indebtedness of a
person to any seller or other person incurred to finance the acquisition
(including in the case of a Capital Lease Obligation, the lease) of any after
acquired real or personal tangible property or assets related to the business of
Alpha or its Subsidiaries and which is incurred substantially concurrently with
such acquisition and is secured only by the assets so financed.


                                       16
<PAGE>
                  "REAL PROPERTY" shall mean, with respect to any person, the
right, title and interest of such person in and to land, improvements and
fixtures, including leaseholds.

                  "RELEVANT TRANSACTION" shall mean (A) any Asset Sale other
than those referred to in Section 7.8(a) through (d), Section 7.8(e) to the
extent Net Sale Proceeds may, in accordance with the terms thereof, be used to
acquire replacement property or be released to Alpha or a Subsidiary of Alpha
and Section 7.8(f); provided that nothing herein shall be deemed to authorize
any Asset Sale not expressly permitted by Section 7.8, (B) the issuance of any
debt securities (including debt securities convertible into, or exchangeable or
exercisable for, equity securities) or the incurrence of any indebtedness for
borrowed money pursuant to Section 7.12(a)(iv), and (C) the issuance of any
equity securities (including shares of capital stock of any class or any
securities convertible into or exercisable for, or any rights, warrants, calls
or options to acquire, any such shares) by Alpha or any Subsidiaries of Alpha,
other than (i) any issuance pursuant to warrants, calls or options to acquire
shares of Alpha or any of its Subsidiaries issued prior to the Closing Date,
(ii) any issuance of equity securities to employees, officers or directors of
Alpha or any of its Subsidiaries (including Washington and its Subsidiaries) in
connection with equity-based compensation arrangements in the ordinary course of
business, (iii) any issuance or equity securities by a Subsidiary of Alpha
solely to Alpha or another Wholly-owned Subsidiary of Alpha, and (iv) any common
stock of Alpha issued pursuant to the Warrant dated June 25, 2002 issued by
Alpha to Jazz Semiconductor, Inc.

                  "RESERVE" shall mean (i) $0, at any time when the amount of
Eligible Receivables exceeds $150,000,000, and (ii) $25,000,000, at any other
time.

                  "RESTRICTED PAYMENT" means any action referred to in Section
7.10.

                  "RESTRICTED SUBSIDIARY" shall mean (i) each organization
listed in Schedule V, (ii) any other Subsidiary of Alpha, other than an Excluded
Subsidiary, which (x) is not an Obligor or (y) has not procured for Conexant a
fully perfected, first-priority Lien on all or substantially all of its property
and assets pursuant to documentation reasonably satisfactory to Conexant.

                  "REVOLVING LOAN" shall mean any loan made pursuant to Section
2.1.2.

                  "REVOLVING NOTE" shall mean any note issued pursuant to
Section 2.1.6.

                  "SECURITIES ACCOUNT CONTROL AGREEMENT" shall mean the
Securities Account Control Agreement among Alpha or any Alpha Subsidiary,
Conexant and the Securities Intermediary of Alpha or any Alpha Subsidiary, in
form and substance reasonably satisfactory to each party thereto in respect of
the Security Accounts listed in Schedule 5.2.1 and Schedule 1 of any Financing
Agreement Supplement.

                  "SECURITIES INTERMEDIARY" shall have the meaning set forth in
the UCC.

                  "SECURITY" shall have the meaning set forth in the UCC.


                                       17
<PAGE>
                  "SECURITY ACCOUNTS" shall have the meaning set forth in the
UCC and shall include the accounts listed on Schedule 5.2.1 hereto and Schedule
1 of any Financing Agreement Supplement.

                  "SECURITY DOCUMENTS" shall mean the U.S. Security Documents,
the Foreign Pledge Agreements and the Mexican Security Documents, individually
and collectively.

                  "SECURITY ENTITLEMENTS" shall have the meaning set forth in
the UCC.

                  "SECURITY INTEREST" shall mean the security interest granted
by the Obligors to Conexant pursuant to Section 4 of this Agreement.

                  "SOFTWARE" shall have the meaning set forth in the UCC.

                  "SOLVENT" shall mean, with respect to any person, that the
value of the assets of such person (both at fair value and present fair saleable
value) is, on the date of determination, greater than the total amount of
liabilities (including contingent and unliquidated liabilities) of such person
as of such date and that, as of such date, such person is able to pay all
liabilities of such person as such liabilities mature and does not have
unreasonably small capital. In computing the amount of contingent or
unliquidated liabilities at any time, such liabilities shall be computed at the
amount that, in light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual or
matured liability.

                  "SPIN-OFF" shall mean the distribution of all the outstanding
common stock, par value $0.01 per share, of Washington to the holders of common
stock, par value $1.00 per share, of Conexant and Conexant Series B Preferred
Stock, other than shares held in the treasury of Conexant, on a one share for
one share basis pursuant to the Contribution Agreement.

                  "STOCK PURCHASE NOTE" shall mean the promissory note issued by
Alpha to Conexant pursuant to Section 2.2 of the Alpha Stock Purchase Agreement,
in the form annexed as Exhibit B-3.

                  "SUBSIDIARY" shall mean, with respect to any person (herein
referred to as the "parent") any corporation, partnership, association or other
business entity (a) of which securities or other ownership interests
representing more than 50% of the equity, the ordinary voting power or the
general partnership interests are, at the time any determination is being made,
owned, controlled or held, or (b) that is otherwise controlled, in each case,
directly or indirectly, by the parent and/or one or more subsidiaries of the
parent. For the purposes of this definition, "controlled by" shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of management or policies of a person, through the ownership of voting
securities, by contract or otherwise.

                  "SUPPLY AGREEMENT" shall mean the Newport Supply Agreement and
the Newbury Supply Agreement, to be entered into between Conexant and Alpha.


                                       18
<PAGE>
                  "SUPPORTING OBLIGATIONS" shall have the meaning set forth in
the UCC.

                  "TANGIBLE CHATTEL PAPER" shall have the meaning set forth in
the UCC.

                  "TAX" shall mean any Federal, state, or foreign tax,
assessment, governmental charge, or levy imposed upon a person or its assets and
properties.

                  "TAX ALLOCATION AGREEMENT" shall mean the Tax Allocation
Agreement by and among Conexant, Washington and Alpha, dated as of June 25,
2002.

                  "TERMINATION DATE" shall mean the date upon which the
Obligations have been paid in full in cash.

                  "TRADEMARK LICENSE" shall mean any written agreement, now or
hereafter in effect, granting to any third party any right to use any Trademark
now or hereafter owned by any Obligor or which any Obligor otherwise has the
right to license, or granting to any Obligor any right to use any Trademark now
or hereafter owned by any third party, and all rights of any Obligor under any
such agreement.

                  "TRADEMARKS" shall mean all of the following now owned or
hereafter acquired by any Obligor: (a) all trademarks, service marks, trade
names, corporate names, company names, business names, fictitious business
names, trade styles, trade dress, logos, other source or business identifiers,
designs and general intangibles of like nature, now existing or hereafter
adopted or acquired, all registrations and recordings thereof, and all
registration and recording applications filed in connection therewith, including
registrations and registration applications in the United States Patent and
Trademark Office, or any State of the United States, and all extensions or
renewals thereof, (b) all goodwill associated therewith or symbolized thereby,
and (c) all other assets, rights and interests that uniquely reflect or embody
such goodwill. Trademarks shall include without limitation (i) the right to sue
or otherwise recover for any and all past, present and future infringements and
misappropriations thereof, and (ii) all income, royalties, damages and other
payments now and hereafter due and/or payable with respect thereto (including,
without limitation, payments under all Trademark Licenses entered into in
connection therewith, and damages and payments for past or future infringements
thereof).

                  "UCC" shall mean (i) the Uniform Commercial Code as in effect
from time to time in the State of New York and (ii) in any case where mandatory
choice of law rules in the New York Uniform Commercial Code require the
application of the Uniform Commercial Code of another United States
jurisdiction, the Uniform Commercial Code of such other jurisdiction as in
effect from time to time.

                  "U.S. ASSET PURCHASE NOTE" shall mean the promissory note
issued by Alpha to Conexant pursuant to Section 2.2 of the Alpha Asset Purchase
Agreement, in the form annexed as Exhibit B-5.


                                       19
<PAGE>
                  "U.S. MORTGAGES" shall mean those certain deeds of trust and
mortgage agreements, dated as of the Closing Date, in the form annexed as
Exhibit G, for the owned properties set forth in Schedule IV.

                  "U.S. SECURITY DOCUMENTS" means this Agreement, the U.S.
Mortgages, the Collateral Assignment of Leases, each Bank Account Control
Agreement, each Securities Account Control Agreement, any Financing Agreement
Supplement, the Security Interest in registered Trademarks and Patents and in
applications for the registration of Trademarks and Patents filed in the United
States Patent and Trademark Office, any Security Interest in registered
Copyrights and in applications for the registration of Copyrights filed in the
United States Copyright Office, the financing statements and each document or
instrument provided pursuant to Sections 4.2 and 4.5 from time to time,
individually and collectively.

                  "WASHINGTON" shall mean Washington Sub, Inc., a Delaware
corporation and Wholly-owned Subsidiary of Conexant.

                  "WHOLLY-OWNED SUBSIDIARY" shall mean any Subsidiary, the
parent of which owns, controls or holds 100% of the equity, the ordinary voting
power or the general partnership interests at the time any such determination is
made, including without limitation any qualifying share structure whereby 100%
of such equity, ordinary voting power or general partnership interests are
owned, controlled or held by the parent together with its Affiliates, directors
or officers.

1.2. RULES OF CONSTRUCTION. The definitions of terms herein shall apply equally
to the singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". The word "will" shall be
construed to have the same meaning and effect as the word "shall". Unless the
context requires otherwise (a) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any person shall be construed to include such person's successors and
assigns (subject to any restrictions on such assignments set forth herein), (c)
the words "herein", "hereof" and "hereunder", and words of similar import shall
be construed to refer to this Agreement in its entirety and not to any
particular provision hereof, (d) all references herein to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles and Sections of,
and Exhibits and Schedules to, this Agreement, (e) the words "asset" and
"property" shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, and (f) any
reference to any law, rule or regulation shall be construed to mean that law,
rule or regulation as amended and in effect from time to time. Each covenant in
this Agreement or any other Financing Document shall be given independent
effect, and the fact that any act or omission may be permitted by one covenant
and prohibited or restricted by any other covenant (whether or not dealing with
the same or similar events) shall not be construed as creating any

                                       20
<PAGE>
ambiguity, conflict or other basis to consider any matter other than the express
terms hereof in determining the meaning or construction of such covenants and
the enforcement thereof in accordance with their respective terms.

1.3. ACCOUNTING TERMS; GAAP. Except as otherwise expressly provided herein, all
terms of an accounting or financial nature shall be construed in accordance with
GAAP, as in effect from time to time.

1.4. HEADINGS DESCRIPTIVE. The headings of the several Sections are inserted for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Agreement.


                                       21
<PAGE>
                                   Schedule I

                  "ELIGIBLE RECEIVABLES" shall mean any Accounts Receivable of
Alpha, as shown on its most recent consolidated balance sheet, other than any:

                  (a) that does not arise from the sale of goods or the
performance of services by Alpha in the ordinary course of its business;

                  (b) (i) upon which Alpha's right to receive payment is not
absolute or is contingent upon the fulfillment of any condition whatsoever or
(ii) as to which Alpha is not able to bring suit or otherwise enforce its
remedies against the account debtor through judicial process or (iii) if the
Account represents a progress billing consisting of an invoice for goods sold or
used or services rendered pursuant to a contract under which the account
debtor's obligation to pay that invoice is subject to Alpha's completion of
further performance under such contract or is subject to the equitable lien of a
surety bond issuer;

                  (c) to the extent that any defense, counterclaim, setoff or
dispute is asserted as to such Account;

                  (d) that is not a true and correct statement of bona fide
indebtedness incurred in the amount of the Account for merchandise sold to or
services rendered and accepted by the applicable account debtor;

                  (e) with respect to which an invoice has not been sent to the
applicable account debtor;

                  (f) that (i) is not owned by Alpha or (ii) is subject to any
right, claim, security interest or other interest of any other person, other
than Permitted Liens;

                  (g) that arises from a sale to any director, officer, other
employee or Affiliate of Alpha or any Subsidiary of Alpha;

                  (h) that is the obligation of an account debtor that is the
United States government or a political subdivision thereof, or any state,
county or municipality or department, agency or instrumentality thereof;

                  (i) that is the obligation of an account debtor located in a
foreign country;

                  (j) to the extent Alpha is liable for goods sold or services
rendered by the applicable account debtor to Alpha but only to the extent of the
potential offset;

                  (k) that arises with respect to goods that are delivered on a
bill-and-hold, cash-on-delivery basis or placed on consignment, guaranteed sale
or other terms by reason of which the payment by the account debtor is or may be
conditional;
<PAGE>
                  (l) that is in default, provided, that, without limiting the
generality of the foregoing, an Account shall be deemed in default upon the
occurrence of any of the following;

                           (i) the Account is not paid within the earlier of: 60
                  days following its due date or 90 days following its original
                  invoice date;

                           (ii) the account debtor obligated upon such Account
                  suspends business, makes a general assignment for the benefit
                  of creditors or fails to pay its debts generally as they come
                  due; or

                           (iii) a petition is filed by or against any Account
                  Debtor obligated upon such Account under any bankruptcy law or
                  any other federal, state or foreign receivership, insolvency
                  relief or other law or laws for the relief of debtors;

                  (m) that is the obligation of an account debtor if 50% or more
of the dollar amount of all Accounts owing by that account debtor are ineligible
under the other criteria set forth above;

                  (n) as to which Conexant's Lien thereon is not a first
priority perfected Lien;

                  (o) to the extent such Account is evidenced by a judgment,
Instrument or Chattel Paper;

                  (p) that is payable in any currency other than dollars; or

                  (q) that is otherwise unacceptable to Conexant in its
reasonable credit judgment exercised in a manner which is customary either in
the commercial finance industry; and

                  (r) that is included in any reserve, including for
uncollectable Accounts or other similar reserve.

                                        2

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>9
<FILENAME>b43517ssexv99w2.txt
<DESCRIPTION>TAX ALLOCATION AGREEMENT
<TEXT>
<PAGE>

                                                                    EXHIBIT 99.2


================================================================================






                            TAX ALLOCATION AGREEMENT

                                  by and among

                             CONEXANT SYSTEMS, INC.

                              WASHINGTON SUB, INC.

                                       and

                             ALPHA INDUSTRIES, INC.






                                  June 25, 2002





================================================================================
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                       Page
                                                                                                       ----
<S>                   <C>                                                                              <C>
ARTICLE I             DEFINITIONS........................................................................2
     Section 1.01     General............................................................................2
     Section 1.02     Schedules, etc.....................................................................9

ARTICLE II            FILING OF TAX RETURNS; PAYMENT OF TAXES; REFUNDS...................................9
     Section 2.01     Preparation of Tax Returns.........................................................9
     Section 2.02     Payment of Taxes..................................................................11
     Section 2.03     Tax Refunds and Carrybacks........................................................14
     Section 2.04     Allocation of Straddle Period Taxes...............................................15

ARTICLE III           TAX INDEMNIFICATION; TAX CONTESTS.................................................16
     Section 3.01     Indemnification...................................................................16
     Section 3.02     Distribution Taxes................................................................18
     Section 3.03     Notice of Indemnity...............................................................19
     Section 3.04     Payments..........................................................................19
     Section 3.05     Tax Contests......................................................................21

ARTICLE IV            OPTIONS; COMPENSATION PAYMENTS; INTEREST
                      CHARGE FOR LATE PAYMENTS; CURRENCY
                      CALCULATIONS; EFFECTIVE TIME OF
                      TRANSACTIONS .....................................................................22
     Section 4.01     Stock Options and Restricted Stock................................................22
     Section 4.02     Compensation Payments.............................................................23
     Section 4.03     Change in Law.....................................................................24
     Section 4.04     Interest Charge for Late Payments.................................................24
     Section 4.05     Currency Calculations.............................................................24
     Section 4.06     Effective Time of Transaction.....................................................25

ARTICLE V             COOPERATION AND EXCHANGE OF INFORMATION...........................................25
     Section 5.01     Inconsistent Actions..............................................................25
     Section 5.02     Ruling Request....................................................................25
     Section 5.03     [Intentionally Omitted]...........................................................25
     Section 5.04     Cooperation and Exchange of Information...........................................25
     Section 5.05     Tax Records.......................................................................26
</TABLE>


                                       i
<PAGE>
<TABLE>
<S>                   <C>                                                                               <C>
ARTICLE VI            MISCELLANEOUS.....................................................................27
     Section 6.01     Entire Agreement; Construction....................................................27
     Section 6.02     Effectiveness.....................................................................27
     Section 6.03     Survival of Agreements............................................................28
     Section 6.04     Governing Law.....................................................................28
     Section 6.05     Notices...........................................................................28
     Section 6.06     Dispute Resolution................................................................30
     Section 6.07     Consent to Jurisdiction...........................................................30
     Section 6.08     Amendments........................................................................31
     Section 6.09     Successors and Assigns............................................................31
     Section 6.10     Captions; Currency................................................................31
     Section 6.11     Severability......................................................................32
     Section 6.12     Parties in Interest...............................................................32
     Section 6.13     Schedules.........................................................................32
     Section 6.14     Waivers; Remedies.................................................................32
     Section 6.15     Counterparts......................................................................32
     Section 6.16     Performance.......................................................................33
     Section 6.17     Interpretation....................................................................33
</TABLE>


                                       ii
<PAGE>
                            TAX ALLOCATION AGREEMENT

         TAX ALLOCATION AGREEMENT (this "AGREEMENT") dated as of June 25, 2002,
by and among CONEXANT SYSTEMS, INC., a Delaware corporation ("CONEXANT"),
WASHINGTON SUB, INC., a Delaware corporation and a wholly-owned subsidiary of
Conexant ("WASHINGTON"), and ALPHA INDUSTRIES, INC., a Delaware corporation
("ALPHA").

         WHEREAS, Conexant and Washington have entered into a contribution and
distribution agreement (the "DISTRIBUTION AGREEMENT"), pursuant to which (a) all
the Washington Assets (as defined in the Distribution Agreement) will be
assigned to Washington and/or to one or more of the Washington Subsidiaries (as
defined in the Distribution Agreement) and all of the Washington Liabilities (as
defined in the Distribution Agreement) will be assumed by Washington and/or by
one or more of the Washington Subsidiaries, all as provided in the Distribution
Agreement (the "CONTRIBUTION") and (b) all of the issued and outstanding shares
of common stock, par value $.01 per share, of Washington (the "WASHINGTON COMMON
STOCK") will be distributed on a pro rata basis to Conexant's stockholders as
provided in the Distribution Agreement (the "DISTRIBUTION");

         WHEREAS, the Boards of Directors of Conexant, Washington and Alpha have
approved an agreement and plan of reorganization (the "MERGER AGREEMENT")
pursuant to which Washington and Alpha will enter into a merger transaction in
order to advance the long-term strategic business interests of Conexant,
Washington and Alpha;

         WHEREAS, the Boards of Directors of Conexant, Washington and Alpha have
determined to consummate such merger transaction by means of a business
combination transaction in which, immediately following the Distribution
Washington will merge with and into Alpha (the "MERGER"), with Alpha being the
surviving corporation;

         WHEREAS, the parties to this Agreement intend that the Contribution and
the Distribution qualify under Sections 355 and 368 of the Code (as defined
herein) as a reorganization, that the Merger qualify under Section 368 of the
Code as a reorganization and that the Merger Agreement shall constitute a "plan
or reorganization" for purposes of Sections 354 and 361 of the Code; and

         WHEREAS, Conexant and Alpha wish to provide for and agree upon the
allocation between the Conexant Tax Group (as defined herein) and the Alpha Tax
Group (as defined herein) of all responsibilities, liabilities and benefits
relating to
<PAGE>
or affecting Taxes (as defined herein) paid or payable by either of them for all
taxable periods, whether beginning before, on or after the Distribution Date (as
defined herein).

         NOW, THEREFORE, in consideration of the premises and of the respective
agreements contained in this Agreement, the parties hereto hereby agree as
follows:

                                    ARTICLE I

                                   DEFINITIONS

         SECTION 1.01 GENERAL. As used in this Agreement, the following terms
shall have the following meanings (such meanings to be equally applicable to
both the singular and plural forms of the terms defined). Any capitalized term
not otherwise defined in this Agreement shall have the meaning ascribed to it in
the Distribution Agreement.

         "ACTUALLY REALIZED" shall mean, for purposes of determining the timing
of any Taxes (or related Tax cost or benefit) relating to any payment,
transaction, occurrence or event, the time at which the amount of Taxes
(including estimated Taxes) payable by any person is increased above or reduced
below, as the case may be, the amount of Taxes that such person would be
required to pay but for the payment, transaction, occurrence or event.

         "ALPHA" shall have the meaning ascribed thereto in the preamble.

         "ALPHA COMMON STOCK" shall mean the Common Stock, par value $0.25 per
share, of Alpha and the associated preferred share purchase rights.

         "ALPHA COMMON STOCK OPTIONS" shall mean options to acquire shares of
Alpha Common Stock.

         "ALPHA GROUP EMPLOYEES AND FORMER EMPLOYEES" shall mean individuals (i)
who are employees of any member of the Alpha Tax Group on the date of the event
giving rise to a deduction in respect of any Compensation Payments made to such
individuals or Stock Options or Restricted Stock held by such individuals or
(ii) who were employees of any member of the Alpha Tax Group and were not
thereafter employees of any member of the Conexant Tax Group.

         "ALPHA POST-DISTRIBUTION TAX ACT" shall have the meaning set forth in
Section 3.01(a).


                                       2
<PAGE>
         "ALPHA RESTRICTED STOCK" shall mean shares of Alpha Common Stock
subject to restrictions on transferability and subject to a substantial risk of
forfeiture.

         "ALPHA TAX ACT" shall have the meaning set forth in Section 3.02(b).

         "ALPHA TAX GROUP" shall mean (i) Alpha, (ii) any member of the
Washington Tax Group, and (iii) any corporation or other legal entity which
Alpha directly or indirectly owned or owns prior to, on or following the
Distribution Date.

         "ALPHA TAX REPRESENTATION LETTER" shall mean the letter delivered by
Alpha to Conexant on the Distribution Date, substantially in the form set forth
in Schedule 3.02(c) attached hereto.

         "ASSET PURCHASE AGREEMENTS" shall mean those asset purchase agreements
dated as of December 16, 2001 by and between Conexant and Alpha, as amended and
restated as of June 25, 2002, providing for the sale of certain assets to Alpha
after the Merger.

         "CODE" shall mean the Internal Revenue Code of 1986, as amended, or any
successor legislation.

         "COMPENSATION PAYMENTS" shall mean all non-qualified employee benefit
plan and welfare benefit plan payments made by any member of the Alpha Tax Group
under the Employee Matters Agreement dated as of the date hereof by and among
Conexant, Washington and Alpha.

         "CONEXANT" shall have the meaning ascribed thereto in the preamble.

         "CONEXANT BOARD" shall mean the Board of Directors of Conexant or a
duly authorized committee thereof.

         "CONEXANT COMMON STOCK" shall mean the Common Stock, par value of $1
per share, of Conexant and the associated preferred share purchase rights.

         "CONEXANT COMMON STOCK OPTIONS" shall mean options to acquire Conexant
Common Stock.

         "CONEXANT GROUP EMPLOYEES AND FORMER EMPLOYEES" shall mean individuals
(i) who are employees of any member of the Conexant Tax Group on the date of the
event giving rise to a deduction in respect of any Compensation Payments made to
such individuals or Stock Options or Restricted Stock held by such individuals,
or (ii) who were employees of any member of the Conexant Tax Group and were not
thereafter employees of any member of the Alpha Tax Group.


                                       3
<PAGE>
         "CONEXANT RESTRICTED STOCK" shall mean shares of Conexant Common Stock
subject to restrictions on transferability and subject to a substantial risk of
forfeiture.

         "CONEXANT TAX GROUP" shall mean (i) Conexant, (ii) any corporation or
other legal entity which Conexant directly or indirectly owns immediately
following the Distribution Date other than a member of the Alpha Tax Group,
(iii) any other corporation or other legal entity which Conexant directly or
indirectly owned at any time on or prior to the Distribution Date other than a
member of the Alpha Tax Group, and (iv) solely for purposes of this Agreement
and not for purposes of any other Transaction Agreement or the Merger Agreement,
for any taxable period (A) Old Rockwell and any other corporation or legal
entity owned by Old Rockwell other than a member of the Alpha Tax Group and (B)
Rockwell and any other corporation or legal entity owned by Rockwell other than
a member of the Alpha Tax Group.

         "CONEXANT TAX REPRESENTATION LETTER" shall mean the letter delivered by
Conexant to Alpha on the Distribution Date, substantially in the form set forth
in Schedule 3.02(d) attached hereto.

         "CONEXANT/WASHINGTON TAX GROUP" shall mean any corporation or other
legal entity which is a member of the Conexant Tax Group or the Washington Tax
Group but only with respect to taxable periods (or portions thereof) ending on
or before or including the Distribution Date.

         "CONTRIBUTION" shall have the meaning ascribed thereto in the
Distribution Agreement.

         "DISTRIBUTION" shall mean the distribution of the Washington Common
Stock on a pro rata basis to holders of Conexant Common Stock and Conexant
Series B Preferred Stock on the Distribution Date pursuant to the Distribution
Agreement.

         "DISTRIBUTION AGREEMENT" shall have the meaning ascribed thereto in the
preamble.

         "DISTRIBUTION TAXES" shall mean any Taxes resulting from (a) the
failure of the Contribution and the Distribution to qualify as a reorganization
under Sections 355 and 368 of the Code, (b) the failure of the Contribution and
the Distribution to qualify as tax-free to Conexant under Sections 355(c) and
361(c) of the Code, or (c) the failure of any pre-Distribution transaction
specified in Schedule 3.01(b) to be non-taxable.


                                       4
<PAGE>
         "DISTRIBUTION TRANSACTION" shall mean any transaction undertaken in
connection with the Distribution and described in the Ruling Request.

         "DISTRIBUTION DATE" shall mean the date on which the Distribution
occurs (or, if different, the date on which the Distribution is deemed to occur
for U.S. federal Income Tax purposes). For purposes of this Agreement, the
Distribution shall be deemed effective as of the end of the day on the
Distribution Date.

         "FINANCING AGREEMENT " shall mean the financing agreement dated as of
June 25, 2002 by and among Alpha, certain of its subsidiaries and Conexant.

         "FOREIGN INCOME TAX" shall mean any Income Tax other than a U.S.
federal, state or local Income Tax.

         "FOREIGN INCOME TAX RETURNS" shall mean any Income Tax Return which is
not a U.S. federal, state or local Income Tax Return.

         "INCOME TAX" shall mean (a) any Tax based upon, measured by, or
calculated with respect to (i) net income or profits (including, but not limited
to, any capital gains, minimum Tax and any Tax on items of Tax preference, but
not including sales, use, real or personal property, gross or net receipts,
transfer or similar Taxes) or (ii) multiple bases (including, but not limited
to, corporate franchise, doing business or occupation Taxes) if one or more of
the bases upon which such Tax may be based, measured by, or calculated with
respect to, is described in clause (i) above, or (b) any U.S. state or local
franchise Tax; including in the case of each of (a) and (b) any related interest
and any penalties, additions to such Tax or additional amounts imposed with
respect thereto by any Tax Authority.

         "INCOME TAX BENEFIT" shall mean for any taxable period the excess of
(i) the hypothetical Income Tax liability of the taxpayer for the taxable period
calculated as if the Timing Difference or Reverse Timing Difference, as the case
may be, had not occurred but with all other facts unchanged, over (ii) the
actual Income Tax liability of the taxpayer for the taxable period, calculated
taking into account the Timing Difference or Reverse Timing Difference, as the
case may be (treating an Income Tax refund or credit as a negative Income Tax
liability for purposes of such calculation).

         "INCOME TAX DETRIMENT" shall mean for any taxable period the excess of
(i) the actual Income Tax liability of the taxpayer for the taxable period,
calculated taking into account the Timing Difference or Reverse Timing
Difference, as the case may be, over (ii) the hypothetical Income Tax liability
of the taxpayer for the taxable period, calculated as if the Timing Difference
or Reverse Timing Difference, as the


                                       5
<PAGE>
case may be, had not occurred but with all other facts unchanged (treating an
Income Tax refund or credit as a negative Income Tax liability for purposes of
such calculation).

         "INCOME TAX RETURN" shall mean any Tax Return that relates to Income
Taxes.

         "INDEMNITEE" shall have the meaning set forth in Section 3.03.

         "INDEMNITOR" shall have the meaning set forth in Section 3.03.

         "INDEMNITY ISSUE" shall have the meaning set forth in Section 3.03.

         "IRS" shall mean the Internal Revenue Service.

         "NON-INCOME TAX" shall mean any Tax other than an Income Tax.

         "OLD ROCKWELL" shall mean the corporation, formerly named Rockwell
International Corporation, which owned all of the Rockwell Common Stock prior to
the distribution of the Rockwell Common Stock to the shareholders of such
corporation on December 6, 1996.

         "PERSON" shall mean any individual, partnership, joint venture,
corporation, limited liability entity, trust, unincorporated organization or
other entity (including a governmental entity).

         "POST-DISTRIBUTION TAXABLE PERIOD" shall mean a taxable period
beginning after the Distribution Date.

         "POST-TAX INDEMNIFICATION PERIOD" shall mean any Post-Distribution
Taxable Period and that portion of any Straddle Period that begins on the day
after the Distribution Date.

         "PRE-DISTRIBUTION TAXABLE PERIOD" shall mean a taxable period ending on
or before the Distribution Date.

         "REPRESENTATIVE" shall mean, with respect to any Person, any of such
Person's directors, officers, employees, agents, consultants, advisors,
accountants, attorneys and representatives.

         "RESTRICTED STOCK" shall mean Alpha Restricted Stock or Conexant
Restricted Stock.


                                       6
<PAGE>
         "REVERSE TIMING DIFFERENCE" shall mean an increase in income, gain or
recapture, or a decrease in deduction, loss or credit, as calculated for Income
Tax purposes, of the taxpayer for the Tax Indemnification Period coupled with an
increase in deduction, loss or credit, or a decrease in income, gain or
recapture, of the taxpayer for any Post-Tax Indemnification Period.

         "RIGHTS" shall have the meaning ascribed thereto in the Distribution
Agreement.

         "ROCKWELL" shall mean Rockwell Automation, Inc., formerly named
Rockwell International Corporation, a Delaware corporation.

         "ROCKWELL COMMON STOCK" shall mean the Common Stock, par value of $1
per share, of Rockwell.

         "ROCKWELL TAX GROUP" shall mean Rockwell and its affiliates.

         "RULING" shall mean a private letter ruling issued by the IRS in reply
to the Ruling Request including any amendment or supplement thereto in form and
substance reasonably satisfactory to Conexant and Alpha.

         "RULING REQUEST" shall mean a private letter ruling request filed by
Conexant with the IRS (as modified or supplemented), seeking rulings that, inter
alia, the Contribution and the Distribution will qualify under Sections 355 and
368 of the Code as a reorganization.

         "STOCK PURCHASE AGREEMENT" shall mean that stock purchase agreement
dated as of December 16, 2001 by and between Conexant and Alpha, as amended and
restated as of June 25, 2002, providing for the sale of certain stock to Alpha
after the Merger.

         "STOCK OPTIONS" shall mean Alpha Common Stock Options or Conexant
Common Stock Options.

         "STRADDLE PERIOD" shall mean a taxable period that includes but does
not end on the Distribution Date.

         "TAX" and "TAXES" shall mean all forms of taxation, whenever created or
imposed, and whether of the United States or elsewhere, and whether imposed by a
federal, state, municipal, governmental, territorial, local, foreign or other
body, and without limiting the generality of the foregoing, shall include net
income, gross income, gross receipts, sales, use, value added, ad valorem,
transfer, recording, franchise, profits, license, lease, service, service use,
payroll, wage, withholding,


                                       7
<PAGE>
employment, unemployment insurance, workers compensation, social security,
excise, severance, stamp, business license, business organization, occupation,
premium, property, environmental, windfall profits, customs, duties, alternative
minimum, estimated or other taxes, fees, premiums, assessments or charges of any
kind whatever imposed or collected by any governmental entity or political
subdivision thereof, together with any related interest and any penalties,
additions to such tax or additional amounts imposed with respect thereto by any
Tax Authority.

         "TAX AUTHORITY" shall mean, with respect to any Tax, any governmental
entity, quasi-governmental body or political subdivision thereof that imposes
such Tax and the agency (if any) charged with the determination or collection of
such Tax for such entity, body or subdivision.

         "TAX GROUP" shall mean the Conexant Tax Group or the Alpha Tax Group,
as the case may be.

         "TAX INDEMNIFICATION PERIOD" shall mean any Pre-Distribution Taxable
Period and that portion of any Straddle Period that ends on the Distribution
Date.

         "TAX RETURN" shall mean any return, filing, questionnaire, information
return, election or other document required or permitted to be filed, including
requests for extensions of time, filings made with respect to estimated tax
payments, claims for refund and amended returns that may be filed, for any
period with any Tax Authority (whether domestic or foreign) in connection with
any Tax (whether or not a payment is required to be made with respect to such
filing).

         "TIMING DIFFERENCE" means an increase in income, gain or recapture, or
a decrease in deduction, loss or credit, as calculated for Income Tax purposes,
of the taxpayer for any Post-Tax Indemnification Period coupled with an increase
in deduction, loss or credit, or a decrease in income, gain or recapture, of the
taxpayer for the Tax Indemnification Period.

         "TRANSACTION AGREEMENTS" shall have the meaning ascribed thereto in the
Distribution Agreement.

         "WASHINGTON" shall have the meaning ascribed thereto in the preamble.

         "WASHINGTON TAX GROUP" shall mean (i) Washington and (ii) any
corporation or other legal entity which Washington directly or indirectly owns
following the Contribution.


                                       8
<PAGE>
         SECTION 1.02 SCHEDULES, ETC. References to a "SCHEDULE" are, unless
otherwise specified, to a Schedule attached to this Agreement; references to
"SECTION" or "ARTICLE" are, unless otherwise specified, to one of the Sections
or Articles of this Agreement; references to "SUB-SECTION" are, unless the
context otherwise requires, references to the section in which the reference
appears; and references to this Agreement include the Schedules.

                                   ARTICLE II

                FILING OF TAX RETURNS; PAYMENT OF TAXES; REFUNDS

         SECTION 2.01 PREPARATION OF TAX RETURNS.

         (a) UNITED STATES FEDERAL INCOME TAX RETURNS.

         (i) Conexant shall prepare and file or cause to be prepared and filed
all U.S. federal Income Tax Returns (including amendments thereto) which are
required to be filed in respect of (A) a member of the Conexant/Washington Tax
Group for any Pre-Distribution Taxable Period or Straddle Period or (B) a member
of the Conexant Tax Group for any Post-Distribution Taxable Period. Alpha hereby
irrevocably designates, and agrees to cause each of its affiliates to designate,
Conexant as its agent to take any and all actions necessary or incidental to the
preparation and filing of such U.S. federal Income Tax Returns of Conexant's
affiliated group.

         (ii) All U.S. federal Income Tax Returns (including amendments thereto)
with respect to the Washington Tax Group for Post-Distribution Taxable Periods
shall be the responsibility of the Alpha Tax Group.

         (b) UNITED STATES STATE AND LOCAL INCOME TAX RETURNS.

         (i) Conexant shall prepare and file or cause to be prepared and filed
all U.S. state and local Income Tax Returns (including amendments thereto) which
are required to be filed in respect of (A) a member of the Conexant/Washington
Tax Group for any Pre-Distribution Taxable Period or Straddle Period or (B) a
member of the Conexant Tax Group for any Post-Distribution Taxable Period. Alpha
hereby irrevocably designates, and agrees to cause each of its affiliates to
designate, Conexant as its agent to take any and all actions necessary or
incidental to the preparation and filing of such U.S. state and local Income Tax
Returns of members of the Washington Tax Group.


                                       9
<PAGE>
         (ii) All U.S. state and local Income Tax Returns (including amendments
thereto) with respect to the Washington Tax Group for Post-Distribution Taxable
Periods shall be the responsibility of the Alpha Tax Group.

         (c) FOREIGN INCOME TAX RETURNS.

         (i) Conexant shall prepare and file or cause to be prepared and filed
all Foreign Income Tax Returns (including amendments thereto) which are required
to be filed in respect of (A) a member of the Conexant/Washington Tax Group for
any Pre-Distribution Taxable Period or Straddle Period (other than any entity
set forth on Schedule 2.01(c) attached hereto) or (B) a member of the Conexant
Tax Group for any Post-Distribution Taxable Period. Alpha hereby irrevocably
designates, and agrees to cause each of its affiliates to designate, Conexant as
its agent to take any and all actions necessary or incidental to the preparation
and filing of such Foreign Income Tax Returns of members of the Washington Tax
Group.

         (ii) All Foreign Income Tax Returns (including amendments thereto) (A)
with respect to the Washington Tax Group for Post-Distribution Taxable Periods
and (B) with respect to entities set forth on Schedule 2.01(c) attached hereto
required to be filed after the Distribution Date, shall be the responsibility of
the Alpha Tax Group.

         (d) NON-INCOME TAX RETURNS.

         (i) Conexant shall prepare and file or cause to be prepared and filed
all Tax Returns (including amendments thereto) which are Non-Income Tax Returns
which are required to be filed in respect of (A) a member of the
Conexant/Washington Tax Group (other than Washington or any member of the
Washington Tax Group which has never conducted a non-Washington business) for
any Pre-Distribution Taxable Period or Straddle Period or (B) a member of the
Conexant Tax Group for any Post-Distribution Taxable Period. Alpha hereby
irrevocably designates, and agrees to cause each of its affiliates to designate,
Conexant as its agent to take any and all actions necessary or incidental to the
preparation and filing of such Non-Income Tax Returns of members of the
Washington Tax Group.

         (ii) All Non-Income Tax Returns (including amendments thereto) required
to be filed (A) with respect to Washington or any member of the Washington Tax
Group which has never conducted a non-Washington business and (B) with respect
to the Washington Tax Group for Post-Distribution Taxable Periods, shall be the
responsibility of the Alpha Tax Group.


                                       10
<PAGE>
         (e) CONSISTENT WITH PAST PRACTICE; REVIEW BY NON-RESPONSIBLE PARTY.
Unless Conexant and Alpha otherwise agree in writing, all Tax Returns (including
amendments thereto) described in this Section 2.01 filed after the date of this
Agreement for Pre-Distribution Taxable Periods or Straddle Periods, in the
absence of a controlling change in law or circumstances, shall be prepared on a
basis consistent with the elections, accounting methods, conventions and
principles of taxation used for the most recent taxable periods for which Tax
Returns involving similar matters have been filed. Upon the request of the
non-responsible party, the party responsible under this Section 2.01 for
preparation of a particular Tax Return for Pre-Distribution Taxable Periods or
Straddle Periods shall make available a draft of such Tax Return (or relevant
portions thereof) for review and comment by such non-responsible party. Subject
to the provisions of this Agreement, all decisions relating to the preparation
of Tax Returns shall be made in the sole discretion of the party responsible
under this Agreement for such preparation.

         (f) RESPONSIBILITY FOR FILING. Although, pursuant to this Agreement,
Conexant or Alpha may be responsible for filing a particular Tax Return,
Conexant and Alpha have agreed that the actual preparation and filing of certain
Tax Returns will be done by the non-responsible party. Schedule 2.01(f) attached
hereto sets forth a schedule specifying such Tax Returns. Conexant and Alpha may
agree from time to time to additions to or deletions from Schedule 2.01(f).

         SECTION 2.02 PAYMENT OF TAXES.

         (a) UNITED STATES FEDERAL INCOME TAXES. Except as otherwise provided in
this Agreement:

         (i) Conexant shall pay or cause to be paid, on a timely basis, all
Taxes due with respect to the consolidated U.S. federal Income Tax liability for
(A) all members of the Conexant/Washington Tax Group for any Pre-Distribution
Taxable Period or Straddle Period and (B) any member of the Conexant Tax Group
for any Post-Distribution Taxable Period; and

         (ii) Alpha shall pay or cause to be paid, on a timely basis, all Taxes
due with respect to the consolidated U.S. federal Income Tax liability for any
member of the Washington Tax Group for any Post-Distribution Taxable Period.

         (b) UNITED STATES STATE AND LOCAL INCOME TAXES. Except as otherwise
provided in this Agreement:

         (i) Conexant shall pay or cause to be paid, on a timely basis, all
Taxes due with respect to the U.S. state and local Income Tax liability for (A)
all


                                       11
<PAGE>
members of the Conexant/Washington Tax Group for any Pre-Distribution Taxable
Period or Straddle Period and (B) any member of the Conexant Tax Group for any
Post-Distribution Taxable Period; provided, however, that Alpha, on behalf of
the Washington Tax Group, hereby assumes and agrees to pay directly to or at the
direction of Conexant, at least five days prior to the date payment (including
estimated payment) thereof is due, the portion of such U.S. state and local
Income Taxes for that portion of any Straddle Period which begins on the day
after the Distribution Date (calculated pursuant to Section 2.04) which relates
to a member of the Washington Tax Group or its business, assets or activities;
and

         (ii) Alpha shall pay or cause to be paid, on a timely basis, all Taxes
due with respect to the U.S. state and local Income Tax liability for any member
of the Washington Tax Group for any Post-Distribution Taxable Period.

         (c) FOREIGN INCOME TAXES. Except as otherwise provided in this
Agreement:

         (i) Conexant shall pay or cause to be paid, on a timely basis, all
Taxes due with respect to the Foreign Income Tax liability for (A) all members
of the Conexant/Washington Tax Group for any Pre-Distribution Taxable Period or
Straddle Period (other than any entity set forth on Schedule 2.01(c) attached
hereto) and (B) any member of the Conexant Tax Group for any Post-Distribution
Taxable Period; provided, however, that Alpha, on behalf of the Washington Tax
Group, hereby assumes and agrees to pay directly to or at the direction of
Conexant, at least five days prior to the date payment (including estimated
payment) thereof is due, the portion of such Foreign Income Taxes for that
portion of any Straddle Period which begins on the day after the Distribution
Date (calculated pursuant to Section 2.04) which relates to a member of the
Washington Tax Group or its business, assets or activities; and

         (ii) Alpha shall pay or cause to be paid, on a timely basis, all Taxes
due with respect to the Foreign Income Tax liability (A) for any member of the
Washington Tax Group for any Post-Distribution Taxable Period and (B) for any
entity set forth on Schedule 2.01(c) attached hereto.

         (d) NON-INCOME TAXES. Except as otherwise provided in this Agreement:

         (i) Conexant shall pay or cause to be paid, on a timely basis, all
Taxes due with respect to the Non-Income Tax liability for (A) all members of
the Conexant/Washington Tax Group (other than Washington or any member of the
Washington Tax Group which has never conducted a non-Washington business) for


                                       12
<PAGE>
any Pre-Distribution Taxable Period or Straddle Period and (B) any member of the
Conexant Tax Group for any Post-Distribution Taxable Period; provided, however,
that Alpha, on behalf of the Washington Tax Group, hereby assumes and agrees to
pay directly to or at the direction of Conexant, at least five days prior to the
date payment (including estimated payment) thereof is due, the portion of such
Non-Income Taxes for that portion of any Straddle Period which begins on the day
after the Distribution Date (calculated pursuant to Section 2.04) which relates
to a member of the Washington Tax Group or its business, assets or activities;

         (ii) Alpha shall pay or cause to be paid, on a timely basis, all Taxes
due with respect to the Non-Income Tax liability (A) for any member of the
Washington Tax Group for any Post-Distribution Taxable Period and (B) for
Washington or any member of the Washington Tax Group which has never conducted a
non-Washington business for any Pre-Distribution Taxable Period or Straddle
Period; and

         (iii) Conexant agrees that for all periods prior to the Distribution,
it shall pay or cause Washington and each member of the Washington Tax Group
that has never conducted a non-Washington business to pay its respective
Non-Income Tax liabilities consistent with the Conexant Tax Group's past
practice for paying such Non-Income Tax liabilities.

         (iv) Notwithstanding any other provision of this Agreement, all
transfer taxes incurred in connection with the Contribution, the Distribution
and/or the Merger shall be paid in accordance with the provisions of Section
4.09 of the Distribution Agreement.

         (e) POST-DISTRIBUTION DATE TAXES. Except as otherwise provided in this
Agreement, all Taxes for all Post-Distribution Taxable Periods shall be paid or
caused to be paid by the party responsible under this Agreement for filing the
Tax Returns pursuant to which such Taxes are due or, if no such Tax Returns are
due, by the party liable for such Taxes.

         (f) CREDIT FOR PRIOR TAX PAYMENTS. To the extent any member of a Tax
Group has made a payment of Taxes (including estimated Taxes) on or before the
Distribution Date, the party liable for paying such Taxes under this Agreement
shall be entitled to treat the payment as having been paid or caused to have
been paid by such party, and such party shall not be required to reimburse the
party which actually paid such Taxes.


                                       13
<PAGE>
         (g) RESPONSIBILITY FOR PAYMENT; NOTICE OF PAYMENT DUE. Although
Conexant or Alpha may be responsible for paying a particular Tax liability,
Conexant and Alpha may agree that the actual payment to a Taxing Authority of
certain Tax liabilities will be made by the non-responsible party. Conexant and
Alpha may agree to prepare a schedule setting forth such Tax liabilities and may
agree from time to time to additions to or deletions from such schedule. In each
case where Conexant or Alpha, as the case may be, is required to make payment of
Taxes to the other party, Conexant or Alpha, as the case may be, shall notify
the other party as to the amount of Taxes due from the other party at least five
days prior to the date payment (including estimated payment) is due.

         SECTION 2.03 TAX REFUNDS AND CARRYBACKS.

         (a) RETENTION AND PAYMENT OF TAX REFUNDS. Except as otherwise provided
in this Agreement, Conexant shall be entitled to retain, and to receive within
ten days after Actually Realized by the Alpha Tax Group, the portion of all
refunds or credits of Taxes for which the Conexant Tax Group is liable pursuant
to Section 2.02 or Section 3.01(a) or is treated as having paid or caused to
have been paid pursuant to Section 2.02(f), and Alpha shall be entitled to
retain, and to receive within ten days after Actually Realized by the Conexant
Tax Group, the portion of all refunds or credits of Taxes for which the Alpha
Tax Group is liable pursuant to Section 2.02 or Section 3.01(b) or is treated as
having paid or caused to have been paid pursuant to Section 2.02(f). The amount
of any refund or credit of Taxes to which Conexant or Alpha is entitled to
retain or receive pursuant to the foregoing sentence shall be reduced to take
account of any Taxes incurred by the Alpha Tax Group, in the case of a refund or
credit to which Conexant is entitled, or the Conexant Tax Group, in the case of
a refund or credit to which Alpha is entitled, upon the receipt of such refund
or credit.

         (b) CARRYBACKS. Unless the parties otherwise agree in writing, Alpha
shall elect and shall cause each member of the Alpha Tax Group to elect, where
permitted by law, to carry forward any net operating loss, net capital loss,
charitable contribution or other item arising after the Distribution Date that
could, in the absence of such election, be carried back to a Pre-Distribution
Taxable Period. Except as otherwise provided in this Agreement, notwithstanding
the provisions of Section 2.03(a), (i) any refund or credit of Taxes resulting
from the carryback of any item of Taxes attributable to the Alpha Tax Group
arising in a Post-Tax Indemnification Period to a Tax Indemnification Period
shall be for the account and benefit of the Alpha Tax Group, and (ii) any refund
or credit of Taxes resulting from the carryback of any item of Taxes
attributable to the Conexant Tax Group arising in a Post-Tax Indemnification
Period to a Tax Indemnification Period shall be for the account and benefit of
the Conexant Tax Group.


                                       14
<PAGE>
         (c) REFUND CLAIMS. Conexant shall be permitted to file at Conexant's
sole expense, and Alpha shall reasonably cooperate with Conexant in connection
with, any claims for refund of Taxes to which Conexant is entitled pursuant to
this Section 2.03 or any other provision of this Agreement. Conexant shall
reimburse Alpha for any reasonable out-of-pocket costs and expenses incurred by
any member of the Alpha Tax Group in connection with such cooperation. Alpha
shall be permitted to file at Alpha's sole expense, and Conexant shall
reasonably cooperate with Alpha in connection with, any claims for refunds of
Taxes to which Alpha is entitled pursuant to this Section 2.03 or any other
provision of this Agreement. Alpha shall reimburse Conexant for any reasonable
out-of-pocket costs and expenses incurred by any member of the Conexant Tax
Group in connection with such cooperation.

         SECTION 2.04 ALLOCATION OF STRADDLE PERIOD TAXES. In the case of any
Straddle Period:

         (a) PERIODIC TAXES. (i) The periodic Taxes of a member of the Conexant
Tax Group or the Alpha Tax Group or its business, assets or activities that are
not based on income or receipts (e.g., property Taxes) for the portion of any
Straddle Period which ends on the Distribution Date shall be computed based on
the ratio of the number of days in such portion of the Straddle Period and the
number of days in the entire taxable period; and (ii) the periodic taxes of a
member of the Conexant Tax Group or the Alpha Tax Group or its business, assets
or activities that are not based on income or receipts for the portion of any
Straddle Period beginning on the day after the Distribution Date shall be
computed based on the ratio of the number of days in such portion of the
Straddle Period and the number of days in the entire taxable period.

         (b) NON-PERIODIC TAXES. (i) The Taxes of a member of the Conexant Tax
Group or the Alpha Tax Group or its business, assets or activities for that
portion of any Straddle Period ending on the Distribution Date (other than Taxes
described in Section 2.04(a) above), shall be computed on a
"closing-of-the-books" basis as if such taxable period ended as of the close of
business on the Distribution Date, and, in the case of any Taxes of a member of
the Conexant Tax Group or the Alpha Tax Group or its business, assets or
activities with respect to any equity interest in any partnership or other
"flowthrough" entity, as if the taxable period of such partnership or other
"flowthrough" entity ended on the Distribution Date; and (ii) the Taxes of a
member of the Conexant Tax Group or the Alpha Tax Group or its business, assets
or activities for that portion of any Straddle Period beginning after the
Distribution Date (other than Taxes described in Section 2.04(a) above), shall
be computed on a "closing-of-the-books" basis as if such taxable period began on
the day after the Distribution Date, and, in the case of any Taxes of a member
of the


                                       15


<PAGE>


Conexant Tax Group or the Alpha Tax Group or its business, assets or activities
with respect to any equity interest in any partnership or other "flowthrough"
entity, as if the taxable period of such partnership or other "flowthrough"
entity began as of the day after the Distribution Date.

            (c) The Taxes of the Conexant Tax Group and the Alpha Tax Group with
respect to any Tax Return for a Straddle Period which includes a member of each
of the Conexant Tax Group and the Alpha Tax Group or their respective
businesses, assets or activities shall be allocated between the Conexant Tax
Group, on the one hand, and the Alpha Tax Group, on the other hand, determined
in a manner analogous to that set forth in Treasury Regulation Section
1.1552-1(a)(2).


                                  ARTICLE III

                        TAX INDEMNIFICATION; TAX CONTESTS


            SECTION 3.01 INDEMNIFICATION.

            (a) CONEXANT INDEMNIFICATION. Subject to Section 3.01(b) and Section
3.02, Conexant shall indemnify, defend and hold harmless each member of the
Alpha Tax Group and each of their respective Representatives and each of the
heirs, executors, successors and assigns of any of the foregoing from and
against:

            (i) all Taxes of the Conexant Tax Group;

            (ii) all Taxes of the Washington Tax Group for all Pre-Distribution
Taxable Periods and all Straddle Periods for which Conexant is liable pursuant
to Section 2.02 or 3.02;

            (iii) all liability as a result of Treasury Regulation Section
1.1502-6 or comparable U.S. state or local provision for Income Taxes of any
person which is or has ever been affiliated with any member of the
Conexant/Washington Tax Group or with which any member of the
Conexant/Washington Tax Group joins or has ever joined (or is or has ever been
required to join) in filing any consolidated, combined or unitary Income Tax
Return for any Tax period ending on or before or including the Distribution Date
except to the extent the Alpha Tax Group is liable for such Taxes pursuant to
Section 2.02 or 3.02;

            (iv) all Taxes for any Tax period (whether beginning before, on or
after the Distribution Date) attributable to the breach by any member of the
Conexant


                                       16
<PAGE>
Tax Group of any representation, warranty, covenant or obligation under this
Agreement;

            (v) all liability for a breach by any member of the Conexant Tax
Group of any representation, warranty, covenant or obligation under this
Agreement;

            (vi) all Taxes imposed in connection with the transactions
contemplated by the Distribution Agreement undertaken to carry out the
Contribution and Distribution; and

            (vii) all liability for any reasonable legal, accounting, appraisal,
consulting or similar fees and expenses relating to the foregoing.

Notwithstanding the foregoing, Conexant shall not indemnify, defend or hold
harmless any member of the Alpha Tax Group nor any of their respective
Representatives or heirs, executors, successors and assigns of any of them from
any liability for Taxes (other than with respect to Distribution Taxes)
attributable to (I) any transfer taxes incurred in connection with the
Contribution, the Distribution and/or the Merger (which shall be paid in
accordance with the provisions of Section 4.09 of the Distribution Agreement) or
(II) any Alpha Post-Distribution Tax Act. An "ALPHA POST-DISTRIBUTION TAX ACT"
shall mean any action specified on Schedule 3.01(a) attached hereto.

            (b) ALPHA INDEMNIFICATION. Alpha shall be liable for, and shall
indemnify, defend and hold harmless each member of the Conexant Tax Group and
each of the respective Representatives and each of the heirs, executors,
successors and assigns of any of the foregoing from and against:

            (i) all Taxes of any member of the Washington Tax Group or Alpha Tax
Group (other than Taxes for which Conexant is obligated to provide
indemnification for pursuant to Section 3.01(a));

            (ii) all Taxes for any Tax period (whether beginning before, on or
after the Distribution Date) attributable to the breach by any member of the
Alpha Tax Group or Washington Tax Group of any representation, warranty,
covenant or obligation under this Agreement;

            (iii) all liability for a breach by any member of the Alpha Tax
Group or Washington Tax Group of any representation, warranty, covenant or
obligation under this Agreement;

            (iv)  all Taxes attributable to an Alpha Post-Distribution Tax Act;


                                       17
<PAGE>
            (v) all transfer taxes incurred in connection with the Contribution,
the Distribution and/or the Merger; and

            (vi) all liability for any reasonable legal, accounting, appraisal,
consulting or similar fees and expenses relating to the foregoing.

            SECTION 3.02 DISTRIBUTION TAXES.

            (a) Except as otherwise provided in this Section 3.02, Conexant
agrees to indemnify, defend and hold harmless each member of the Alpha Tax Group
and each of the respective Representatives and each of the heirs, executors,
successors and assigns of any of the foregoing from and against any Distribution
Taxes.

            (b) Alpha agrees to indemnify, defend and hold harmless each member
of the Conexant Tax Group and each of the respective Representatives and each of
the heirs, executors, successors and assigns of any of the foregoing from and
against any Distribution Taxes resulting from any Alpha Tax Act. For purposes of
this Agreement, in determining the amount of any such Taxes resulting from an
Alpha Tax Act for which Alpha shall be liable, any net operating losses which
would otherwise be taken into account in determining the amount of such
liability shall be ignored. An "ALPHA TAX ACT" shall be as specified on Schedule
3.02(a) attached hereto.

            (c) Alpha shall, and shall cause each member of the Alpha Tax Group
to, comply with and take no action inconsistent with the Alpha Tax
Representation Letter, unless, pursuant to a favorable ruling letter obtained
from the IRS which is satisfactory to Conexant or the advice of nationally
recognized Tax counsel to Conexant, which advice shall be satisfactory to
Conexant, such act or omission would not adversely affect the U.S. federal
Income Tax consequences of the Contribution and the Distribution to Conexant or
the shareowners of Conexant. Notwithstanding Sections 3.01(b)(iii) and
3.01(b)(iv), the parties intend that the sole remedy for breach of the covenants
contained in this Section 3.02(c) shall be as set forth in Section 3.02(b).

            (d) Conexant shall, and shall cause each member of the Conexant Tax
Group to, comply with and take no action inconsistent with the Conexant Tax
Representation Letter, unless, pursuant to a favorable ruling letter obtained
from the IRS which is satisfactory to Alpha or the advice of nationally
recognized Tax counsel to Alpha, which advice shall be satisfactory to Alpha,
such act or omission would not adversely affect the U.S. federal Income Tax
consequences of the Contribution and the Distribution to Conexant or the
shareowners of Conexant. Notwithstanding


                                       18
<PAGE>
Section 3.01(a)(v), the parties intend that the sole remedy for breach of the
covenants contained in this Section 3.02(d) shall be as set forth in Section
3.02(a).

            (e) Notwithstanding the foregoing, an Alpha Tax Act (other than
paragraphs 7 or 8 thereof) shall not include any transaction or action
specifically disclosed or specifically described in any of the Transaction
Agreements, the Merger Agreement, the Stock Purchase Agreement or the Asset
Purchase Agreements or, except as specifically set forth in Schedule 3.01(b),
any action taken on or prior to the Distribution Date. An Alpha Tax Act shall
not include any action on the part of any member of the Conexant Tax Group.

            SECTION 3.03 NOTICE OF INDEMNITY. Whenever a party hereto
(hereinafter an "INDEMNITEE") becomes aware of the existence of an issue raised
by any Tax Authority which could reasonably be expected to result in a
determination that would increase the liability for any Tax of the other party
hereto or any member of its Tax Group for any Tax period or require a payment
hereunder by the other party (hereinafter an "INDEMNITY ISSUE"), the Indemnitee
shall in good faith promptly give notice to such other party (hereinafter the
"INDEMNITOR") of such Indemnity Issue. The failure of the Indemnitee to give
such notice shall not relieve the Indemnitor of its obligations under this
Agreement, except to the extent such Indemnitor or a member of its Tax Group is
actually prejudiced by such failure to give notice.

            SECTION 3.04 PAYMENTS.

            (a) TIMING ADJUSTMENTS.

            (i) TIMING DIFFERENCES. If a Tax audit proceeding or an amendment of
a Tax Return results in a Timing Difference, and such Timing Difference results
in a decrease in an indemnity obligation Conexant has or would otherwise have
under Section 3.01(a) and/or an increase in the amount of a Tax refund or credit
to which Conexant is entitled under Section 2.03, then in each Post-Tax
Indemnification Period in which the Alpha Tax Group Actually Realizes an Income
Tax Detriment, Conexant shall pay to Alpha an amount equal to such Income Tax
Detriment; provided, however, that the aggregate payments which Conexant shall
be required to make under this Section 3.04(a)(i) with respect to any Timing
Difference shall not exceed the aggregate amount of the Income Tax Benefits
realized by the Conexant Tax Group for all taxable periods and the Alpha Tax
Group for all Tax Indemnification Periods as a result of such Timing Difference.
Conexant shall make all such payments within ten days after Alpha notifies
Conexant that the relevant Income Tax Detriment has been Actually Realized.


                                       19
<PAGE>
            (ii) REVERSE TIMING DIFFERENCES. If a Tax audit proceeding or an
amendment to a Tax Return results in a Reverse Timing Difference, and such
Reverse Timing Difference results in an increase in an indemnity payment
obligation of Conexant under Section 3.01(a) and/or a decrease in the amount of
a Tax refund or credit to which Conexant is or would otherwise be entitled under
Section 2.03, then in each Post-Tax Indemnification Period in which the Alpha
Tax Group Actually Realizes an Income Tax Benefit, Alpha shall pay to Conexant
within ten days after Alpha has Actually Realized such Income Tax Benefit an
amount equal to such Income Tax Benefit; provided, however, that the aggregate
payments which Alpha shall be required to make under this Section 3.04(a)(ii)
with respect to Reverse Timing Differences shall not exceed the aggregate amount
of the Income Tax Detriments realized by the Alpha Tax Group and the Conexant
Tax Group for all Tax Indemnification Periods as a result of such Reverse Timing
Difference.

            (b) TIME FOR PAYMENT. Except as otherwise provided in this Section
3.04(b), any indemnity payment required to be made pursuant to this Agreement
shall be paid within thirty days after the indemnified party makes written
demand upon the indemnifying party, provided that in no event shall such payment
be required to be made earlier than five business days prior to the date on
which the relevant Taxes (including estimated Taxes) are required to be paid (or
would be required to be paid if no such Taxes are due) to the relevant Tax
Authority. Notwithstanding any other provision in this Agreement, to simplify
the administration of this Agreement, the payment of any amount less than
$100,000 required to be made pursuant to this Agreement by one party hereto to
another party hereto need not be made to such other party prior to thirty days
following the later of (i) the close of the calendar quarter during which such
payment obligation arose and (ii) the day during such calendar quarter when the
aggregate amount of all such less than $100,000 payment obligations arising
during such calendar quarter exceeds $250,000. Unless otherwise specified by the
recipient for items exceeding $500,000, any such payment may be made on a net
Tax basis (i.e., reduced to take account of any net Tax benefit to be realized
by the recipient (computed at the effective Tax rate set forth in Section
3.04(c)) to the extent such recipient is entitled to a corresponding deduction.

            (c) PAYMENTS NET OF TAXES AND TAX BENEFITS. The amount of any
payment under this Agreement shall be (i) reduced to take into account any net
Tax benefit realized by the recipient's Tax Group arising from the incurrence or
payment by such recipient's Tax Group of any amount in respect of which such
payment is made and (ii) increased to take into account any net Tax cost
incurred by the recipient's Tax Group as a result of the receipt or accrual of
payments hereunder (grossed-up for such increase), in each case determined by
treating the recipient as recognizing all other items of income, gain, loss,
deduction or credit before recognizing any item arising from the receipt of
accrual of any payment hereunder.


                                       20
<PAGE>
In determining the amount of any such Tax benefit or Tax cost, (I) if the
recipient's Tax Group's taxable income for the year, after taking into account
tax loss carryovers, is negative or zero, the recipient's Tax Group shall be
deemed not subject to Tax for such purpose, and (II) in all other cases, the
recipient's Tax Group shall be deemed to be subject to Tax as follows: (A) U.S.
federal Income Taxes and foreign Income Taxes at the maximum statutory rate then
in effect and (B) U.S. state and local Income Taxes at an assumed rate of five
percent net of U.S. federal Income Tax benefits. Except as otherwise provided in
this Agreement or unless the parties otherwise agree to an alternative method
for determining the present value of any such anticipated Tax benefit or Tax
cost, any payment hereunder shall initially be made without regard to this
section and shall be increased or reduced to reflect any such net Tax cost
(including gross-up) or net Tax benefit only after the recipient's Tax Group has
Actually Realized such Tax cost or Tax benefit.

            (d) RIGHT TO OFFSET. Any party making a payment under this Agreement
shall have the right to reduce any such payment by any undisputed amounts owed
to it by the other party to this Agreement.

            (e) CHARACTERIZATION OF PAYMENTS. It is the intention of the parties
to this Agreement that payments made pursuant to this Agreement are to be
treated as relating back to the Distribution as an adjustment to capital (i.e.,
capital contribution or distribution), and the parties shall not take any
position inconsistent with such intention before any Tax Authority, except to
the extent that a final determination (as defined in Section 1313 of the Code)
with respect to the recipient party causes any such payment not to be so
treated.

            SECTION 3.05 TAX CONTESTS. The Indemnitor and its representatives,
at the Indemnitor's expense, shall be entitled to participate (a) in all
conferences, meetings and proceedings with any Tax Authority, the subject matter
of which is or includes an Indemnity Issue and (b) in all appearances before any
court, the subject matter of which is or includes an Indemnity Issue. The party
who has responsibility for filing the Tax Return under this Agreement (the
"RESPONSIBLE PARTY") with respect to which there could be an increase in
liability for any Tax or with respect to which a payment could be required
hereunder shall have the right to decide as between the parties hereto how such
matter is to be dealt with and finally resolved with the appropriate Tax
Authority and shall control all audits and similar proceedings. If no Tax Return
is or was required to be filed in respect of an Indemnity Issue, the Indemnitor
shall be treated as the Responsible Party with respect thereto. The Responsible
Party agrees to cooperate in the settlement of any Indemnity Issue with the
other party and to take such other party's interests into account.


                                       21
<PAGE>
                                   ARTICLE IV

               OPTIONS; COMPENSATION PAYMENTS; INTEREST CHARGE FOR
             LATE PAYMENTS; CURRENCY CALCULATIONS; EFFECTIVE TIME OF
                                  TRANSACTIONS


            SECTION 4.01 STOCK OPTIONS AND RESTRICTED STOCK.

            (a) STOCK OPTION ADJUSTMENTS. Conexant Common Stock Options
outstanding at the time of the Distribution will be adjusted in accordance with
the terms of the Employee Matters Agreement.

            (b) TAX DEDUCTIONS. Notwithstanding anything to the contrary in this
Agreement, unless the IRS issues a contrary private letter ruling to Conexant or
Alpha, or Conexant or Alpha otherwise agree in writing, (A) the Conexant Tax
Group (and not the Alpha Tax Group) shall claim the post-Distribution Date Tax
deductions in respect of Conexant Common Stock Options and Conexant Restricted
Stock and (B) the Alpha Tax Group (and not the Conexant Tax Group) shall claim
any post-Distribution Date Tax deductions in respect of Alpha Common Stock
Options and Alpha Restricted Stock, except to the extent (x) the optionees or
holders would not be (I) "Conexant Group Employees and Former Employees", as
such term is defined in the tax allocation agreement between Conexant and
Rockwell dated December 31, 1998 or (II) Alpha Group Employees and Former
Employees and (y) the tax allocation agreement applicable to such optionees or
holders allocates the tax deduction to the employer corporation, in which case
Conexant shall, within ten days after payment is received from the employer
corporation in accordance with the terms of such tax allocation agreement, pay
such amounts to Alpha.

            (c) NOTICES, WITHHOLDING, REPORTING.

            (i) Conexant shall promptly notify Alpha of any post-Distribution
Date event giving rise to income to any Alpha Group Employees and Former
Employees in connection with the Conexant Common Stock Options and Conexant
Restricted Stock and, if required by law, Alpha shall withhold applicable Taxes
and satisfy applicable Tax reporting obligations in connection therewith.
Conexant shall within ten days of demand thereof reimburse Alpha for all
reasonable out-of-pocket expenses incurred in connection with the Conexant
Common Stock Options and Conexant Restricted Stock, including with respect to
incremental Tax reporting obligations and any incremental employment Tax
obligations; provided that Alpha shall use reasonable efforts to collect any
such amounts required to be paid by Alpha


                                       22
<PAGE>
Group Employees and Former Employees from such Alpha Group Employees and Former
Employees.

            (ii) Alpha shall promptly notify Conexant of any post-Distribution
Date event giving rise to income to any Conexant Group Employees and Former
Employees in connection with the Alpha Common Stock Options and Alpha Restricted
Stock and, if required by law, Conexant shall withhold applicable Taxes and
satisfy applicable Tax reporting obligations in connection therewith. Alpha
shall within ten days of demand thereof reimburse Conexant for all reasonable
out-of-pocket expenses incurred in connection with the Alpha Common Stock
Options and Alpha Restricted Stock, including with respect to incremental Tax
reporting obligations and any incremental employment Tax obligations; provided
that Conexant shall use reasonable efforts to collect any such amounts required
to be paid by Conexant Group Employees and Former Employees from such Conexant
Group Employees and Former Employees.

            (d) TAX AUDIT ADJUSTMENTS. Notwithstanding the provisions of Section
4.01(b), in the event a Tax audit proceeding shall determine (by settlement or
otherwise), or the parties otherwise determine pursuant to Section 4.03, that
all or a portion of the Tax deductions in respect of Conexant Common Stock
Options and Conexant Restricted Stock or Alpha Common Stock Options and Alpha
Restricted Stock should have been claimed by the Alpha Tax Group or the Conexant
Tax Group, respectively, the Alpha Tax Group or the Conexant Tax Group,
respectively, shall claim such Tax deductions (by an amended Tax Return or
otherwise) and shall pay to Conexant or Alpha, as the case may be, the amount of
any Tax refund or credit arising in respect of such Tax deduction within ten
days after such Tax refund or credit is Actually Realized by the Alpha Tax Group
or the Conexant Tax Group, as the case may be.

            SECTION 4.02 COMPENSATION PAYMENTS.

            (a) TAX DEDUCTIONS. Notwithstanding anything to the contrary in this
Agreement, unless Conexant and Alpha otherwise agree in writing, (i) the
Rockwell Tax Group (and not the Conexant Tax Group or the Alpha Tax Group) shall
claim the Post-Distribution Date Tax deductions in respect of Compensation
Payments paid by the Rockwell Tax Group to Alpha Group Employees and Former
Employers, (ii) the Alpha Tax Group (and not the Conexant Tax Group) shall claim
the Post-Distribution Date Tax deductions in respect of Compensation Payments
paid by the Alpha Tax Group to all other Alpha Group Employees and Former
Employees, and (iii) the Conexant Tax Group (and not the Alpha Tax Group) shall
claim the Post-Distribution Date Tax deductions in respect of Compensation
Payments paid by


                                       23
<PAGE>
the Conexant Tax Group to all other Alpha Group Employees and Former Employees.

            (b) NOTICES, WITHHOLDING, REPORTING. The party responsible for
making the Compensation Payments pursuant to the Employee Matters Agreement
shall withhold applicable Taxes and satisfy applicable Tax reporting obligations
in connection with the Compensation Payments made to all Alpha Group Employees
and Former Employees.

            (c) TAX AUDIT ADJUSTMENTS. Notwithstanding the provisions of Section
4.02(a), in the event a Tax audit proceeding shall determine (by settlement or
otherwise), or the parties otherwise determine pursuant to Section 4.03, that
all or a portion of the Tax deductions in respect of Compensation Payments paid
to Alpha Group Employees and Former Employees was not available to the party
claiming the Tax deduction, then the appropriate party shall claim such Tax
deductions (by an amended Tax Return or otherwise) and shall pay to the party
which had previously claimed such Tax deduction, within ten days after such Tax
deduction has been Actually Realized by the such appropriate party, the amount
of the resulting Tax benefit to such appropriate party.

            SECTION 4.03 CHANGE IN LAW. Notwithstanding the agreement with
respect to reporting of Tax items and the claiming of the deductions set forth
in Article 4 of this Agreement, neither the Alpha Tax Group nor the Conexant Tax
Group shall have any obligation to report any such Tax items or claim such
deductions as set forth in such Article in the event that either such party
determines, based on an opinion of nationally recognized tax counsel, which
opinion shall be satisfactory to the other party, that there is no substantial
authority to support reporting such Tax items or claiming such deductions on a
Tax Return filed by such party as a result of a change in or amendment to any
law or regulation, or any change in the official interpretation thereof,
effective or occurring after the date of this Agreement, and such Tax Group
provides prompt notice to the other Tax Group of any such determination.

            SECTION 4.04 INTEREST CHARGE FOR LATE PAYMENTS. Any amount due and
owing by one party to the other party pursuant to this Agreement that is not
paid when due shall bear interest from the due date thereof until paid at a rate
equal to the prime rate of Citibank, N.A. in effect on the date such payment was
required to be made.

            SECTION 4.05 CURRENCY CALCULATIONS. All currency calculations shall
be made in accordance with Section 7.17 of the Distribution Agreement.


                                       24
<PAGE>
            SECTION 4.06 EFFECTIVE TIME OF TRANSACTION. Conexant and Alpha agree
that any transaction that, pursuant to the Distribution Agreement, is expressly
effective immediately after the Time of Distribution shall be treated for
federal Income Tax purposes as occurring at the beginning of the day following
the Distribution Date.


                                   ARTICLE V

                     COOPERATION AND EXCHANGE OF INFORMATION


            SECTION 5.01 INCONSISTENT ACTIONS. Each party to this Agreement
agrees (i) to, and to cause each of the relevant members of its Tax Group to,
report the Contribution and Distribution as a reorganization described in
Sections 355 and 368 of the Code and the Merger as a reorganization described in
Section 368 of the Code on all Tax Returns and other filings, (ii) to use its
best efforts to ensure that the Distribution and the Merger receive such
treatment for U.S. federal Income Tax purposes and (iii) that, unless it has
obtained the prior written consent of the other party, it (and the members of
its Tax Group) shall not take any action inconsistent with, or fail to take any
action required by, the Transaction Agreements and the Merger Agreement. For all
Post-Distribution Taxable Periods, each party to this Agreement agrees to, and
to cause each of the relevant members of its Tax Group to, in the absence of a
controlling change in law or circumstances, report on all Tax Returns the tax
consequences of the transactions undertaken pursuant to the Transaction
Agreements, the Merger Agreement, the Stock Purchase Agreement, the Asset
Purchase Agreements and the Ruling Request in accordance with the positions
taken (including valuations and purchase price allocations) with respect to such
transactions to the extent reported on Tax Returns filed with respect to all
Pre-Distribution Taxable Periods and Straddle Periods in respect of such
transactions.

            SECTION 5.02 RULING REQUEST. Each party hereto represents that
neither it (nor any of the members of its Tax Group) will take or has any plan
or intention to take any action which is inconsistent with any factual
statements, representations or other similar conditions contained in the Ruling
Request or in the Ruling.

            SECTION 5.03 [INTENTIONALLY OMITTED].

            SECTION 5.04 COOPERATION AND EXCHANGE OF INFORMATION. Each party
hereto agrees to provide, and to cause each member of its Tax Group to provide,
such cooperation and information as such other party shall request, on a timely
basis, in connection with the preparation or filing of any Tax Return or claim
for Tax refund


                                       25
<PAGE>
not inconsistent with this Agreement or in conducting any Tax audit, Tax
dispute, or otherwise in respect of Taxes or to carry out the provisions of this
Agreement (including any cooperation required to carry out the intentions of the
parties as set forth in the preamble), which cooperation and information shall
include in particular, making its employees involved in the research and
development process available to the other party and having such employees
provide such assistance as the other party may require for such purposes,
provided, however, that neither party shall be obligated to provide the other
party Tax Returns, documentation or other information of a proprietary or
confidential nature for purposes of verifying any calculation, and provided
further, that in any such case where one party does not provide the other party
with Tax Returns, documentation or information because it is proprietary or
confidential, both parties shall cooperate in developing mutually acceptable
procedures including retaining a mutually agreeable accounting firm to review
such Tax Returns, documentation or information for purposes of verifying such
calculation. To the extent necessary to carry out the purposes of this Agreement
and subject to the other provisions of this Agreement, such cooperation and
information shall include without limitation the non-exclusive designation of an
officer of Conexant as an officer of Alpha and each of its affiliates for the
purpose of signing Tax Returns, cashing refund checks, pursuing refund claims,
dealing with Tax Authorities and defending audits as well as promptly forwarding
copies of appropriate notices and forms or other communications received from or
sent to any Tax Authority which relate to the Alpha Tax Group for the Tax
Indemnification Period and providing copies of all relevant Tax Returns for the
Tax Indemnification Period, together with accompanying schedules and related
workpapers, documents relating to rulings or other determinations by Tax
Authorities, including without limitation, foreign Tax Authorities, and records
concerning the ownership and Tax basis of property, which either party may
possess. Subject to the rights of the Alpha Tax Group under the other provisions
of this Agreement, such officer shall have the authority to execute powers of
attorney (including Form 2848) on behalf of each member of the Alpha Tax Group
with respect to Tax Returns for the Tax Indemnification Period. Each party to
this Agreement shall make, or shall cause its affiliates to make, its employees
and facilities available on a mutually convenient basis to provide an
explanation of any documents or information provided hereunder.

            SECTION 5.05 TAX RECORDS.

            (a) Conexant and Alpha agree to (and to cause each member of their
respective Tax Group to) (i) retain all Tax Returns, related schedules and
workpapers, and all material records and other documents as required under
Section 6001 of the Code and the regulations promulgated thereunder relating
thereto existing on the date hereof or created through the Distribution Date,
for a period of at least ten years following the Distribution Date and (ii)
allow the party to this


                                       26
<PAGE>
Agreement, at times and dates reasonably acceptable to the retaining party, to
inspect, review and make copies of such records, as Conexant and Alpha may
reasonably deem necessary or appropriate from time to time. In addition, after
the expiration of such ten-year period, such Tax Returns, related schedules and
workpapers, and material records shall not be destroyed or otherwise disposed of
at any time, unless, prior to such destruction or disposal, (A) the party
proposing to destroy or otherwise dispose of such records shall provide no less
than 30 days' prior written notice to the other party, specifying in reasonable
detail the records proposed to be destroyed or disposed of and (B) if a
recipient of such notice shall request in writing prior to the scheduled date
for such destruction or disposal that any of the records proposed to be
destroyed or disposed of be delivered to such requesting party, the party
proposing the destruction or disposal shall promptly arrange for the delivery of
such requested records at the expense of the party requesting such records.

            (b) Notwithstanding anything in this Agreement to the contrary, if
any party fails to comply with the requirements of Section 5.05(a) hereof, the
party failing so to comply shall be liable for, and shall hold the other party,
harmless from, any Taxes (including without limitation, penalties for failure to
comply with the record retention requirements of the Code) and other costs
resulting from such party's failure to comply.


                                   ARTICLE VI

                                  MISCELLANEOUS


            SECTION 6.01 ENTIRE AGREEMENT; CONSTRUCTION. This Agreement, the
Distribution Agreement, all other Transaction Agreements and the Merger
Agreement, including any annexes, schedules and exhibits hereto or thereto, and
other agreements and documents referred to herein and therein, will together
constitute the entire agreement between the parties with respect to the subject
matter hereof and thereof and will supersede all prior negotiations, agreements
and understandings of the parties of any nature, whether oral or written, with
respect to such subject matter. Notwithstanding any other provisions in this
Agreement to the contrary, in the event and to the extent that there is a
conflict relating to Taxes between the provisions of this Agreement and the
provisions of the Distribution Agreement, any other Transaction Agreement or the
Merger Agreement, the provisions of this Agreement will control.

            SECTION 6.02 EFFECTIVENESS. All covenants and agreements of the
parties contained in this Agreement shall be subject to and conditioned upon the
Distribution becoming effective.


                                       27
<PAGE>
            SECTION 6.03 SURVIVAL OF AGREEMENTS. Except as otherwise
contemplated by this Agreement, all covenants and agreements of the parties
contained in this Agreement will remain in full force and effect and survive the
Time of Distribution.

            SECTION 6.04 GOVERNING LAW. This Agreement will be governed by and
construed in accordance with the internal laws of the State of Delaware
applicable to contracts made and to be performed entirely within such State,
without regard to the conflicts of law principles of such State.

            SECTION 6.05 NOTICES. All notices, requests, claims, demands and
other communications required or permitted to be given hereunder will be in
writing and will be delivered by hand, telecopied, e-mailed or sent, postage
prepaid, by registered, certified or express mail or reputable overnight courier
service and will be deemed given when so delivered by hand or telecopied, when
e-mail confirmation is received if delivered by e-mail, or three business days
after being so mailed (one business day in the case of express mail or overnight
courier service). All such notices, requests, claims, demands and other
communications will be addressed as set forth below, or pursuant to such other
instructions as may be designated in writing by the party to receive such
notice:

            (a)   If to Conexant:

                  Conexant Systems, Inc.
                  4311 Jamboree Road
                  Newport Beach, California  92660-3095

                  Attention:  Dwight W. Decker
                              Chairman of the Board and Chief Executive
                                Officer
                  Telecopy:   (949) 483-4318
                  E-mail:     dwight.decker@conexant.com


                                       28
<PAGE>
                  with a copy to:

                  Conexant Systems, Inc.
                  4311 Jamboree Road
                  Newport Beach, California  92660-3095

                  Attention:  Dennis E. O'Reilly, Esq.
                              Senior Vice President, General Counsel
                              and Secretary
                  Telecopy:   (949) 483-6388
                  E-mail:     dennis.o'reilly@conexant.com


            (b)   If to Washington after the Effective Time:

                  Washington Sub, Inc.
                  c/o Alpha Industries, Inc.
                  20 Sylvan Road
                  Woburn, Massachusetts  01801

                  Attention:  Paul E. Vincent
                              Chief Financial Officer
                  Telecopy:   (617) 824-4426
                  E-mail:     pvincent@alphaind.com

                  with a copy to:

                  Alpha Industries, Inc.
                  20 Sylvan Road
                  Woburn, Massachusetts  01801

                  Attention:  James K. Jacobs, Esq.
                              General Counsel
                  Telecopy:   (617) 824-4564
                  E-mail:     jjacobs@alphaind.com


                                       29
<PAGE>
            (c)   If to Alpha

                  Alpha Industries, Inc.
                  20 Sylvan Road
                  Woburn, Massachusetts  01801

                  Attention:  Paul E. Vincent
                              Chief Financial Officer
                  Telecopy:   (617) 824-4426
                  E-mail:     pvincent@alphaind.com

                  with a copy to:

                  Alpha Industries, Inc.
                  20 Sylvan Road
                  Woburn, Massachusetts  01801

                  Attention:  James K. Jacobs, Esq.
                              General Counsel
                  Telecopy:   (617) 824-4564
                  E-mail:     jjacobs@alphaind.com


            SECTION 6.06 DISPUTE RESOLUTION. Any dispute, claim or controversy
arising out of or relating to any provision of this Agreement or the breach,
performance, enforcement or validity or invalidity thereof will be resolved in
accordance with the procedures set forth in Section 7.05 of the Distribution
Agreement, provided that each such mediator or arbitrator selected pursuant to
such procedures shall have an expertise in Tax matters.

            SECTION 6.07 CONSENT TO JURISDICTION. Each of Conexant, Washington
and Alpha irrevocably submits to the exclusive jurisdiction of (i) the Court of
Chancery in and for the State of Delaware and the Superior Court in and for the
State of Delaware and (ii) the United States District Court for the District of
Delaware, for the purposes of any suit, action or other proceeding arising out
of or relating to this Agreement or any transaction contemplated hereby or the
breach, performance, enforcement or validity or invalidity of any thereof (and
agrees not to commence any action, suit or proceeding relating thereto except in
such courts). Each of Conexant, Washington and Alpha further agrees that service
of any process, summons, notice or document hand delivered or sent by U.S.
registered mail to such party's respective address set forth in Section 6.05
will be effective service of process for any action, suit or proceeding in
Delaware with respect to any matters to which it


                                       30
<PAGE>
has submitted to jurisdiction as set forth in the immediately preceding
sentence. Each of Conexant, Washington and Alpha irrevocably and unconditionally
waives any objection to the laying of venue of any action, suit or proceeding
arising out of or relating to this Agreement or the transactions contemplated
hereby or the breach, performance, enforcement or validity or invalidity of any
thereof in (i) the Court of Chancery in and for the State of Delaware and the
Superior Court in and for the State of Delaware or (ii) the United States
District Court for the District of Delaware, and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such action, suit or proceeding brought in any such court has been brought
in an inconvenient forum. Notwithstanding the foregoing, each party agrees that
a final judgment in any action, suit or proceeding so brought shall be
conclusive and may be enforced by suit on the judgment in any jurisdiction or in
any other manner provided in law or in equity

            SECTION 6.08 AMENDMENTS. This Agreement cannot be amended, modified
or supplemented except by a written agreement executed by Conexant and Alpha.

            SECTION 6.09 SUCCESSORS AND ASSIGNS. Neither party to this Agreement
will convey, assign or otherwise transfer any of its rights or obligations under
this Agreement without the prior written consent of the other party in its sole
and absolute discretion. Notwithstanding the foregoing, Conexant or Alpha may
(without obtaining any consent) assign, delegate or sublicense all or any
portion of its rights and obligations hereunder to (i) the surviving entity
resulting from a merger or consolidation involving such party, (ii) the
acquiring entity in a sale or other disposition of all or substantially all of
the assets of such party as a whole or of any line of business or division of
such party, or (iii) any other Person that is created as a result of a spin-off
from, or similar reorganization transaction of, such party or any line of
business or division of such party. In the event of an assignment pursuant to
(ii) or (iii) above, the nonassigning party shall, at the assigning party's
request, use good faith commercially reasonable efforts to enter into separate
agreements with each of the resulting entities and take such further actions as
may be reasonably required to assure that the rights and obligations under this
Agreement are preserved, in the aggregate, and divided equitably between such
resulting entities. Any such conveyance, assignment or transfer requiring the
prior written consent of another party which is made without such consent will
be void ab initio. No assignment of this Agreement will relieve the assigning
party of its obligations hereunder.

            SECTION 6.10 CAPTIONS; CURRENCY. The article, section and paragraph
captions herein and the table of contents hereto are for convenience of
reference only, do not constitute part of this Agreement and will not be deemed
to limit or otherwise affect any of the provisions hereof. Unless otherwise
specified, all


                                       31
<PAGE>
references herein to numbered articles or sections are to articles and sections
of this Agreement and all references herein to schedules are to schedules to
this Agreement. Unless otherwise specified, all references contained in this
Agreement or in any schedule referred to herein to dollars or "$" shall mean
U.S. dollars.

            SECTION 6.11 SEVERABILITY. If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances other than those as to which it has been held invalid or
unenforceable, will remain in full force and effect and will in no way be
affected, impaired or invalidated thereby. If the economic or legal substance of
the transactions contemplated hereby is affected in any manner adverse to any
party as a result thereof, the parties will negotiate in good faith in an effort
to agree upon a suitable and equitable substitute provision to effect the
original intent of the parties.

            SECTION 6.12 PARTIES IN INTEREST. Except for the provisions of
Article III relating to Tax Indemnification, this Agreement is solely for the
benefit of the parties hereto and the respective members of their Tax Group and
should not be deemed to confer upon third parties (including any employee of
Conexant or Alpha or of any Conexant or Alpha subsidiary) any remedy, claim,
reimbursement, claim of action or other right in excess of those existing
without reference to this Agreement.

            SECTION 6.13 SCHEDULES. All schedules attached hereto are hereby
incorporated in and made a part of this Agreement as if set forth in full
herein. Capitalized terms used in the schedules hereto but not otherwise defined
therein will have the respective meanings assigned to such terms in this
Agreement.

            SECTION 6.14 WAIVERS; REMEDIES. No failure or delay by any party
hereto in exercising any right, power or privilege hereunder will operate as a
waiver thereof, nor will any waiver on the part of any party hereto of any
right, power or privilege hereunder operate as a waiver of any other right,
power or privilege hereunder, nor will any single or partial exercise of any
right, power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder.
Subject to Section 6.06, the rights and remedies herein provided are cumulative
and are not exclusive of any rights or remedies which the parties may otherwise
have at law or in equity.

            SECTION 6.15 COUNTERPARTS. This Agreement may be executed in
separate counterparts, each such counterpart being deemed to be an original
instrument, and all such counterparts will together constitute the same
agreement.


                                       32
<PAGE>
            SECTION 6.16 PERFORMANCE. Each party hereto will cause to be
performed, and hereby guarantees the performance of all actions, agreements and
obligations set forth herein to be performed by any subsidiary or any member of
such party's Tax Group.

            SECTION 6.17 INTERPRETATION. Any reference to any Federal, state,
local, or foreign Law shall be deemed also to refer to all rules and regulations
promulgated thereunder, unless the context requires otherwise. For the purposes
of this Agreement, (i) words in the singular shall be held to include the plural
and vice versa and words of one gender shall be held to include the other gender
as the context requires, (ii) the terms "hereof ", "herein", and "herewith" and
words of similar import shall, unless otherwise stated, be construed to refer to
this Agreement as a whole and not to any particular provision of this Agreement
and (iii) the word "including" and words of similar import when used in this
Agreement shall mean "including, without limitation".


                                       33
<PAGE>
            IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officers of the parties as of the date first
hereinabove written.


                                    CONEXANT SYSTEMS, INC.


                                    By: /s/ DENNIS E. O'REILLY
                                        --------------------------------------
                                        Name:  Dennis E. O'Reilly
                                        Title: Senior Vice President,
                                               General Counsel &
                                               Secretary



                                    WASHINGTON SUB, INC.


                                    By: /s/ DENNIS E. O'REILLY
                                        --------------------------------------
                                        Name:  Dennis E. O'Reilly
                                        Title: Vice President and
                                               Secretary



                                    ALPHA INDUSTRIES, INC.


                                    By: /s/ PAUL E. VINCENT
                                        --------------------------------------
                                        Name:  Paul E. Vincent
                                        Title: Vice President, Chief
                                               Financial Officer,
                                               Treasurer & Secretary



                                       34

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.3
<SEQUENCE>10
<FILENAME>b43517ssexv99w3.txt
<DESCRIPTION>EMPLOYEE MATTERS AGREEMENT
<TEXT>
<PAGE>

                                                                    EXHIBIT 99.3


================================================================================

                           EMPLOYEE MATTERS AGREEMENT


                                  by and among


                             CONEXANT SYSTEMS, INC.,


                              WASHINGTON SUB, INC.


                                       and


                             ALPHA INDUSTRIES, INC.


================================================================================

                                  June 25, 2002
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                             Page
                                                                                                             ----
<S>                                                                                                          <C>
ARTICLE I                    DEFINITIONS....................................................................   4
         Section 1.01        General........................................................................   4

ARTICLE II                   EMPLOYEES......................................................................   8
         Section 2.01        Employees......................................................................   8

ARTICLE III                  SAVINGS PLANS..................................................................  10
         Section 3.01        Retirement Savings Plan........................................................  10
         Section 3.02        Hourly Employees' Savings Plan.................................................  10
         Section 3.03        Non-Qualified Retirement Savings Plan..........................................  10

ARTICLE IV                   PENSION PLANS..................................................................  11
                             [INTENTIONALLY OMITTED]........................................................  11

ARTICLE V                    STOCK PLANS....................................................................  11
         Section 5.01        Stock Plans....................................................................  11

ARTICLE VI                   OTHER EMPLOYEE PLANS AND MATTERS...............................................  12
         Section 6.01        Welfare Plans..................................................................  12
         Section 6.02        Incentive Compensation Plans...................................................  15
         Section 6.03        Deferred Compensation Plan.....................................................  15
         Section 6.04        Severance Pay..................................................................  16
         Section 6.05        Employment, Consulting and Other Employee Related Agreements...................  16
         Section 6.06        Employee Stock Purchase Plans..................................................  17
         Section 6.07        VERP...........................................................................  17
         Section 6.08        Performance Share Plan.........................................................  19
         Section 6.09        Other Liabilities..............................................................  19

ARTICLE VII                  MISCELLANEOUS..................................................................  20
         Section 7.01        Indemnification................................................................  20
         Section 7.02        Sharing of Information.........................................................  20
         Section 7.03        Entire Agreement; Construction.................................................  20
         Section 7.04        Survival of Agreements.........................................................  21
         Section 7.05        Governing Law..................................................................  21
         Section 7.06        Notices........................................................................  21
         Section 7.07        Amendments.....................................................................  21
         Section 7.08        Assignment.....................................................................  21
         Section 7.09        Captions; Currency.............................................................  22
         Section 7.10        Severability...................................................................  22
         Section 7.11        Parties in Interest............................................................  22
         Section 7.12        Schedules......................................................................  22
         Section 7.13        Change of Name.................................................................  22
         Section 7.14        Waivers; Remedies..............................................................  23
</TABLE>


                                       i
<PAGE>
<TABLE>
<CAPTION>
                                                                                                             Page
                                                                                                             ----
<S>                                                                                                          <C>
         Section 7.15        Counterparts...................................................................  23
         Section 7.16        Performance....................................................................  23
         Section 7.17        Dispute Resolution.............................................................  23
         Section 7.18        Cooperation....................................................................  23
         Section 7.19        Interpretation.................................................................  24
</TABLE>


                                       ii
<PAGE>
                           EMPLOYEE MATTERS AGREEMENT


         EMPLOYEE MATTERS AGREEMENT (this "Agreement") dated as of June 25, 2002
by and among CONEXANT SYSTEMS, INC., a Delaware corporation ("Conexant"),
WASHINGTON SUB, INC., a Delaware corporation and a wholly-owned subsidiary of
Conexant ("Washington"), and ALPHA INDUSTRIES, INC., a Delaware corporation
("Alpha").

         WHEREAS, Conexant, Washington and Alpha have entered into an Agreement
and Plan of Reorganization dated as of December 16, 2001, as amended as of April
12, 2002 (the "Merger Agreement"), providing for, among other things, the merger
of Washington with and into Alpha, with Alpha being the surviving corporation;

         WHEREAS, Conexant and Washington also have entered into a Contribution
and Distribution Agreement dated as of December 16, 2001, as amended (the
"Distribution Agreement"), pursuant to which (a) all the Washington Assets (as
defined in the Distribution Agreement) will be contributed to Washington and/or
to one or more of the Washington Subsidiaries (as defined in the Distribution
Agreement) and all of the Washington Liabilities (as defined in the Distribution
Agreement) will be assumed by Washington and/or by one or more of the Washington
Subsidiaries, all as provided in the Distribution Agreement (the "Contribution")
and (b) issued and outstanding shares of Common Stock, par value $.01 per share,
of Washington ("Washington Common Stock") will be distributed on a pro rata
basis to Conexant's stockholders as provided in the Distribution Agreement (the
"Distribution");

         WHEREAS, the execution and delivery of this Agreement by the parties
hereto is a condition to the obligations of the parties to the Merger Agreement
to consummate the Merger (as defined in the Merger Agreement);

         WHEREAS, the execution and delivery of this Agreement by the parties
hereto is a condition to the obligations of the parties to the Distribution
Agreement to consummate the Distribution; and

         WHEREAS, in connection with the Contribution and the Distribution,
Conexant and Washington have determined that it is appropriate and desirable to
provide for the allocation of certain assets and liabilities and certain other
matters relating to employees, employee benefit plans and compensation
arrangements;

         NOW, THEREFORE, in consideration of the premises and of the respective
agreements and covenants contained in this Agreement, the parties hereby agree
as follows:


<PAGE>
                                   ARTICLE I

                                   DEFINITIONS


         Section 1.01 General. Capitalized terms used in this Agreement (or in
any Schedule to this Agreement) but not defined herein (other than the names of
employee benefit plans) will have the meanings ascribed to such terms in the
Distribution Agreement. As used in this Agreement (or in any Schedule to this
Agreement), the terms defined in Schedule 1.01 have the meanings set forth in
Schedule 1.01 and the following terms have the following meanings (in each case,
such meanings to be equally applicable to both the singular and plural forms of
the terms defined):

                  "ACTIVE CONEXANT EMPLOYEE" means any individual who,
         immediately after the Time of Distribution, will be employed by a
         member of the Conexant Group pursuant to Section 2.01(b).

                  "ACTIVE WASHINGTON EMPLOYEE" means any individual who,
         immediately after the Time of Distribution, will be employed by a
         member of the Washington Group pursuant to Section 2.01(a).

                  "AGREEMENT" has the meaning set forth in the preamble.

                  "ALPHA" has the meaning set forth in the preamble.

                  "CODE" means the Internal Revenue Code of 1986, as amended, or
         any successor legislation.

                  "CONEXANT" has the meaning set forth in the preamble.

                  "CONEXANT DEFERRED COMPENSATION PLAN" means the Conexant
         Systems, Inc. Deferred Compensation Plan, including all amendments
         thereto through the Distribution Date.

                  "CONEXANT DEFERRED COMPENSATION PLAN RABBI TRUST" means the
         Conexant Systems, Inc. master rabbi trust relating to the Conexant
         Deferred Compensation Plan, including all amendments thereto through
         the Distribution Date.

                  "CONEXANT 1999 ESPP" means the Conexant Systems, Inc. 1999
         Employee Stock Purchase Plan, including all amendments thereto through
         the Distribution Date, under which no Offering Periods (as defined in
         the plan) are currently outstanding.

                  "CONEXANT 2001 ESPP" means the Conexant Systems, Inc. 2001
         Employee Stock Purchase Plan, including all amendments thereto through
         the Distribution Date.

                  "CONEXANT HOURLY SAVINGS PLAN" means the Conexant Systems,
         Inc. Hourly Employees' Savings Plan, including all amendments thereto
         through the Distribution Date.


                                       4
<PAGE>
                  "CONEXANT NON-QUALIFIED ESPP" means the Conexant Systems, Inc.
         Non-Qualified Employee Stock Purchase Plan, including all amendments
         thereto through the Distribution Date.

                  "CONEXANT NON-QUALIFIED SAVINGS PLAN" means the Conexant
         Systems, Inc. Non-Qualified Retirement Savings Plan, including all
         amendments thereto through the Distribution Date.

                  "CONEXANT OPTION" means an option to purchase from Conexant
         shares of Conexant Common Stock granted pursuant to or governed by one
         of the Conexant Stock Plans which is outstanding immediately prior to
         the Time of Distribution.

                  "CONEXANT PARTICIPANT" means any individual who, immediately
         after the Time of Distribution, is (a) an Active Conexant Employee, (b)
         a Former Conexant Employee or (c) a beneficiary of either of the
         foregoing.

                  "CONEXANT PERFORMANCE SHARE PLAN" means the Conexant Systems,
         Inc. 2001 Performance Share Plan, including all amendments thereto
         through the Distribution Date.

                  "CONEXANT SAVINGS PLAN" means the Conexant Systems, Inc.
         Retirement Savings Plan, including all amendments thereto through the
         Distribution Date.

                  "CONEXANT SPLIT OPTION" means each Conexant Option (other than
         the Mindspeed March 30 Options).

                  "CONEXANT STOCK PLANS" means each of the following plans:

                           (i)      Conexant Systems, Inc. 1998 Stock Option
                                    Plan;

                           (ii)     Conexant Systems, Inc. 1999 Long-Term
                                    Incentives Plan;

                           (iii)    Conexant Systems, Inc. 2000 Non-Qualified
                                    Stock Plan;

                           (iv)     Conexant Systems, Inc. Directors Stock Plan;

                           (v)      Istari Design, Inc. 1997 Stock Option Plan;

                           (vi)     Microcosm Communications Limited Stock
                                    Option Plan;

                           (vii)    Maker Communications, Inc. 1999 Stock
                                    Incentive Plan;

                           (viii)   Maker Communications, Inc. 1996 Stock Option
                                    Plan;

                           (ix)     Applied Telecom, Inc. 2000 Non-Qualified
                                    Stock Option Plan;

                           (x)      Philsar Semiconductor Inc. Stock Option
                                    Plan;


                                       5
<PAGE>
                           (xi)     Sierra Imaging, Inc. 1996 Stock Option Plan;

                           (xii)    HotRail, Inc. 1997 Equity Incentive Plan;

                           (xiii)   HotRail, Inc. 2000 Equity Plan;

                           (xiv)    NetPlane Systems, Inc. Stock Option Plan;

                           (xv)     Novanet Semiconductor Ltd. Employee Shares
                                    Option Plan; and

                           (xvi)    HyperXS Communications, Inc. 2000 Stock
                                    Option Plan;

in each case, including all amendments thereto through the Distribution Date.

                  "CONEXANT VERP" means the Conexant Systems, Inc. Voluntary
         Early Retirement Program, including all amendments thereto through the
         Distribution Date.

                  "CONEXANT VERP TRUST" means the Conexant Systems, Inc. trust
         relating to the Conexant VERP, including all amendments thereto through
         the Distribution Date.

                  "CONEXANT WELFARE PLANS" has the meaning set forth in Section
         6.01(a).

                  "CONTRIBUTION" has the meaning set forth in the recitals.

                  "DISTRIBUTION" has the meaning set forth in the recitals.

                  "DISTRIBUTION AGREEMENT" has the meaning set forth in the
         recitals.

                  "EFFECTIVE TIME" has the meaning set forth in the Merger
         Agreement.

                  "ERISA" means the Employee Retirement Income Security Act of
         1974, as amended, or any successor legislation.

                  "FORMER CONEXANT EMPLOYEE" means any Pre-Distribution Group
         Employee who is not, immediately after the Time of Distribution, an
         Active Conexant Employee or an Active Washington Employee, and whose
         most recent active employment with Conexant or any other member of the
         Pre-Distribution Group (but with respect to each such member who has
         ceased to be an Affiliate of Conexant or its predecessors, prior to the
         time that such member of the Pre-Distribution Group ceased to be an
         Affiliate of Conexant or its predecessors) was with the Conexant
         Business.

                  "FORMER WASHINGTON EMPLOYEE" means any Pre-Distribution Group
         Employee who is not, immediately after the Time of Distribution, an
         Active Washington Employee or an Active Conexant Employee, and whose
         most recent active employment with Conexant or any other member of the
         Pre-Distribution Group (but with respect to each such member who has
         ceased to be an Affiliate of Conexant or its predecessors, prior to the
         time that such member of the Pre-Distribution Group


                                       6
<PAGE>
         ceased to be an Affiliate of Conexant or its predecessors) was with the
         Washington Business or, to the extent such Pre-Distribution Group
         Employee's function was primarily related to the Washington Business,
         the corporate office of Conexant.


                  "INCENTIVE COMPENSATION PLANS" means each of the following
         plans:

                           (i)      Peak Performance Plan, Conexant's Annual
                                    Incentive Plan;

                           (ii)     Peak Performance Plan - Marketing,
                                    Conexant's Annual Incentive Plan; and

                           (iii)    Conexant Systems, Inc. FY02 Sales
                                    Compensation Plan.

                  "MERGER AGREEMENT" has the meaning set forth in the recitals.

                  "MINDSPEED MARCH 30 OPTIONS" means those Conexant Options
         granted to employees of Conexant's Mindspeed Technologies business on
         March 30, 2001 and those Conexant Options held by persons in certain
         foreign locations (none of whom is an Active Washington Employee), as
         determined by the Compensation and Management Development Committee of
         the Board of Directors of Conexant and set forth on Schedule 1.01(b).

                  "PRE-DISTRIBUTION GROUP" has the meaning set forth in the
         Distribution Agreement.

                  "PRE-DISTRIBUTION GROUP EMPLOYEE" means any individual who
         was, at any time prior to the Time of Distribution, employed by
         Conexant or any other member of the Pre-Distribution Group (but with
         respect to each such member who has ceased to be an Affiliate of
         Conexant or its predecessors, prior to the time that such member of the
         Pre-Distribution Group ceased to be an Affiliate of Conexant or its
         predecessors).

                  "RETURNING WASHINGTON EMPLOYEE" has the meaning set forth in
         Section 2.01(c).

                  "WASHINGTON" has the meaning set forth in the preamble.

                  "WASHINGTON COMMON STOCK" has the meaning set forth in the
         recitals.

                  "WASHINGTON ESPP" has the meaning set forth in Section
         6.06(a).

                  "WASHINGTON NON-QUALIFIED ESPP" has the meaning set forth in
         Section 6.06(a).

                  "WASHINGTON OPTION" means an option to purchase from
         Washington shares of Washington Common Stock provided to a holder of a
         Conexant Split Option pursuant to Section 5.01(a).


                                       7
<PAGE>
                  "WASHINGTON PARTICIPANT" means any individual who, immediately
         after the Time of Distribution, is (a) an Active Washington Employee,
         (b) a Former Washington Employee or (c) a beneficiary of either of the
         foregoing.

                  "WASHINGTON SAVINGS PLAN" has the meaning set forth in Section
         3.01(a).

                  "WASHINGTON STOCK PLANS" has the meaning set forth in Section
         5.01(b).

                  "WASHINGTON VERP" has the meaning set forth in Section
         6.07(a).

                  "WASHINGTON VERP TRUST" has the meaning set forth in Section
         6.07(a).

                  "WASHINGTON WELFARE PLANS" has the meaning set forth in
         Section 6.01(a).

                  "WELFARE PLAN" means an employee welfare benefit plan as
         defined in Section 3(1) of ERISA, including medical, vision, dental and
         other health plans, retiree health plans, life insurance plans, retiree
         life insurance plans, accidental death and dismemberment plans,
         long-term disability plans and severance pay plans.

                  "WIRELESS EMPLOYEE" has the meaning set forth in Section
         2.01(c).

                                   ARTICLE II

                                    EMPLOYEES


         Section 2.01 Employees. (a) Each individual who is employed by Conexant
or any of its Subsidiaries (including members of the Washington Group and
members of the Conexant Group) immediately prior to the Time of Distribution and
who is identified on the attached Schedule 2.01 (including those individuals
identified on Schedule 2.01 who are actively employed or on lay-off, leave,
short-term or long-term disability or other permitted absence from employment)
will be or will continue to be employed by a member of the Washington Group
immediately after the Time of Distribution and will be an Active Washington
Employee.

         (b) Each individual (other than those identified on Schedule 2.01) who
is employed by Conexant or any of its Subsidiaries (including members of the
Washington Group and members of the Conexant Group) immediately prior to the
Time of Distribution (including those who are actively employed or on lay-off,
leave, short-term or long-term disability or other permitted absence from
employment) will be or will continue to be employed by a member of the Conexant
Group immediately after the Time of Distribution and will be an Active Conexant
Employee.

         (c) Notwithstanding the foregoing, in the event that on or prior to
December 31, 2003, any Active Washington Employee returns directly from
employment with Alpha or any of its Subsidiaries to employment with Conexant or
any of its Subsidiaries (a "Returning Washington Employee") or any Active
Conexant Employee leaves employment


                                       8
<PAGE>
with Conexant or any of its Subsidiaries and is employed directly by Alpha or
any of its Subsidiaries (a "Wireless Employee"), in each case, with the prior
written consent of either (x) both the Chief Executive Officer of Conexant and
the Chief Executive Officer of Alpha or (y) both the Senior Vice President,
Human Resources of Conexant and the Vice President, Human Resources of Alpha,
then:

                  (i) Conexant shall credit such Returning Washington Employee
         (A) under welfare benefit plans of Conexant and its Subsidiaries with
         all service and other items which have been credited or accumulated for
         the benefit of such Returning Washington Employee under the
         corresponding welfare benefit plans of Alpha or its Subsidiaries and
         (B) with all service with Alpha and its Subsidiaries for purposes of
         eligibility and vesting (but not for benefit accrual or contributions)
         under any savings plan, retirement plan, stock option plan, incentive
         compensation plan, deferred compensation plan, performance share plan,
         employee stock purchase plan or other similar plan of Conexant and its
         Subsidiaries, and such Returning Washington Employee will be considered
         to have been in continuous service with Conexant and its Subsidiaries
         during the combined period of employment with both Conexant and its
         Subsidiaries and Alpha and its Subsidiaries and will not be considered
         to have terminated employment with Conexant and its Subsidiaries as a
         result of the Distribution and the Merger; and

                  (ii) Alpha shall credit such Wireless Employee (A) under
         welfare benefit plans of Alpha and its Subsidiaries with all service
         and other items which have been credited or accumulated for the benefit
         of such Wireless Employee under any welfare benefit plans of Conexant
         or its Subsidiaries and (B) with all service with Conexant and its
         Subsidiaries for purposes of eligibility and vesting (but not for
         benefit accrual or contributions) under any savings plan, retirement
         plan, stock option plan, incentive compensation plan, deferred
         compensation plan, performance share plan, employee stock purchase plan
         or other similar plan of Alpha and its Subsidiaries, as if such
         Wireless Employee had become an Active Washington Employee as of the
         Time of Distribution pursuant to the terms of this Agreement.

                  (d) Effective as of the Time of Distribution, (i) for
immigration purposes Washington will be the successor-in-interest to any and all
pending or approved visa petitions (whether with the U.S. Immigration and
Naturalization Service or U.S. Department of Labor), including pending or
completed Labor Condition Applications, made by Conexant and its Subsidiaries
with respect to Active Washington Employees, and Washington will adopt and
accept all representations made by Conexant in any of these petitions and
applications, (ii) Washington will adopt any Labor Condition Application
included in the "Public Access Folders" for Active Washington Employees who have
H-1B visas, and (iii) Washington will adopt any existing I-9 certifications of
Conexant and its Subsidiaries with respect to Active Washington Employees.

                  (e) Nothing contained in this Section 2.01 is intended to
confer upon any employee of the Conexant Group or the Washington Group any right
to continued employment after the Time of Distribution.


                                       9
<PAGE>
                                   ARTICLE III

                                  SAVINGS PLANS


         Section 3.01 Retirement Savings Plan. (a) As of the Effective Time,
Washington or Alpha will have established, and will cover Active Washington
Employees who were eligible to participate in the Conexant Savings Plan prior to
the Time of Distribution under, a new or existing defined contribution plan (the
"Washington Savings Plan"), which will be qualified pursuant to Sections 401(a)
and 401(k) of the Code, and will have established a related trust which will be
exempt from taxation under Section 501(a) of the Code. The Washington Savings
Plan will credit each participating Active Washington Employee thereunder for
purposes of eligibility and vesting with all service which had been credited to
such employee for such purposes under the Conexant Savings Plan immediately
prior to the Time of Distribution.

         (b) After the Time of Distribution, each Active Washington Employee who
participated in the Conexant Savings Plan prior to the Time of Distribution will
be permitted to rollover his or her account balances from the Conexant Savings
Plan to the Washington Savings Plan in accordance with the terms of the
respective plans and applicable law; provided, however, that to the extent that
any Active Washington Employee has any outstanding loans related to his or her
account balances in the Conexant Savings Plan, such Active Washington Employee
will not be permitted to rollover his or her account balances to the Washington
Savings Plan until such loan has been repaid in full to the Conexant Savings
Plan.

         (c) Effective as of the Time of Distribution, Active Washington
Employees will cease to be eligible to contribute to, or receive contributions
in respect of, their Conexant Savings Plan accounts. None of Washington, any
other member of the Washington Group, Affiliates of the foregoing, the
Washington Savings Plan or the trust thereunder will have or acquire any
interest in or right to any of the assets of the Conexant Savings Plan, and
Conexant will retain full power and authority with respect to the amendment and
termination of the Conexant Savings Plan and the investment and disposition of
assets held in the Conexant Savings Plan to the extent permitted by law.

         Section 3.02 Hourly Employees' Savings Plan. As of the Time of
Distribution, Conexant will retain sponsorship of the Conexant Hourly Savings
Plan. No Active Washington Employees or Former Washington Employees are eligible
to participate in the Conexant Hourly Savings Plan. Accordingly, none of
Washington or any member of the Washington Group will have or retain any
interest in or right to any of the assets of the Conexant Hourly Savings Plan or
will have any Liabilities with respect to such plan, and Conexant will have full
power and authority with respect to the Conexant Hourly Savings Plan.

         Section 3.03 Non-Qualified Retirement Savings Plan. As of the Time of
Distribution, Conexant will retain sponsorship of the Conexant Non-Qualified
Retirement Savings Plan. Effective as of the Effective Time, each Washington
Participant set forth on


                                       10
<PAGE>
Schedule 3.03 who was eligible to participate in the Conexant Non-Qualified
Savings Plan prior to the Time of Distribution will be treated as having
terminated employment with Conexant and the Conexant Subsidiaries for purposes
of determining his or her eligibility to participate in the Conexant
Non-Qualified Savings Plan and will be paid his or her vested account balance
pursuant to the terms of the plan. Accordingly, none of Washington or any member
of the Washington Group will have or retain any interest in or right to any of
the assets of the Conexant Non-Qualified Savings Plan or, except as set forth in
the immediately following sentence, will have any Liabilities with respect to
such plan, and Conexant will have full power and authority with respect to the
Conexant Non-Qualified Savings Plan. Notwithstanding anything to the contrary in
this Section 3.03, within three Business Days (as defined in the Merger
Agreement) after the Time of Distribution, Washington shall pay to Conexant an
amount equal to the vested account balances paid or to be paid to such
Washington Participants by Conexant pursuant to the terms of the Conexant
Non-Qualified Savings Plan and this Section 3.03.

                                   ARTICLE IV

                                  PENSION PLANS


                             [INTENTIONALLY OMITTED]

                                   ARTICLE V

                                   STOCK PLANS


         Section 5.01 Stock Plans. (a) Conexant and Washington will take all
action necessary or appropriate so that each Conexant Split Option that is
outstanding immediately prior to the Time of Distribution is adjusted pursuant
to the equitable adjustment and other provisions of the applicable Conexant
Stock Plan under which such Conexant Split Option was granted in the manner
described in this Section 5.01. The number of shares of Conexant Common Stock
subject to such adjusted Conexant Split Option and the per-share exercise price
of such adjusted Conexant Split Option will be determined as set forth on
Schedule 5.01(a)(i). Each such adjusted Conexant Split Option will otherwise
have the same terms and conditions as those in effect immediately prior to the
adjustment. In addition, each person holding a Conexant Split Option that is
outstanding immediately prior to the Time of Distribution will receive a
Washington Option pursuant to the equitable adjustment and other provisions of
the applicable Conexant Stock Plan under which such Conexant Split Option was
granted. The number of shares of Washington Common Stock subject to such
Washington Option and the per-share exercise price of such Washington Option
will be determined as set forth on Schedule 5.01(a)(ii). Each such Washington
Option will otherwise have substantially the same terms and conditions as the
corresponding Conexant Split Option being adjusted, except that references to
Conexant will be changed to refer to Washington and references to any of the
Conexant Stock Plans will be changed to refer to Washington's applicable stock
option plan.


                                       11
<PAGE>
         (b) Prior to the Time of Distribution, Washington will have established
one or more stock option plans (the "Washington Stock Plans") the purposes of
which are to provide a means for Washington to perform its obligations with
respect to Washington Options derived from the Conexant Split Options and which
will be substantially similar in all material respects to the corresponding
Conexant Stock Plan governing the Conexant Split Option from which the
Washington Option was derived and will provide that solely for purposes of
vesting and treatment of the Washington Options upon termination of employment,
retirement, death or disability under the Washington Stock Plan, continued
employment of the holder of any Washington Option who is not an Active
Washington Employee with such holder's current employer (or an Affiliate
thereof) shall be treated as continued employment with Washington. From and
after the Time of Distribution, Washington will retain sponsorship of and will
be solely responsible for the Washington Stock Plans.

         (c) The Conexant Stock Plans will provide that solely for purposes of
vesting and treatment of the Conexant Split Options upon termination of
employment, retirement, death or disability under the Conexant Stock Plans,
continued employment of any Active Washington Employee who holds a Conexant
Split Option with Washington or Alpha (or an Affiliate thereof) shall be treated
as continued employment with Conexant. From and after the Time of Distribution,
Conexant will retain sponsorship of and will be solely responsible for the
Conexant Stock Plans.

         (d) Conexant and Washington will take all action necessary or
appropriate so that each Mindspeed March 30 Option that is outstanding
immediately prior to the Time of Distribution is adjusted pursuant to the
equitable adjustment and other provisions of the applicable Conexant Stock Plan
under which such Mindspeed March 30 Option was granted in the manner described
in this Section 5.01(d). The number of shares of Conexant Common Stock subject
to such adjusted Mindspeed March 30 Option and the per-share exercise price of
such adjusted Mindspeed March 30 Option will be determined as set forth on
Schedule 5.01(d). Each such adjusted Mindspeed March 30 Option will otherwise
have the same terms and conditions as those in effect immediately prior to the
adjustment.

                                   ARTICLE VI

                        OTHER EMPLOYEE PLANS AND MATTERS


         Section 6.01 Welfare Plans. (a) Effective as of the Effective Time,
Washington or Alpha will have established, and will cover Washington
Participants under, new or existing Welfare Plans and other employee welfare
benefit and fringe benefit arrangements (collectively, "Washington Welfare
Plans") that are comparable in the aggregate to the Welfare Plans and other
employee welfare benefit and fringe benefit arrangements maintained by Conexant
and its Subsidiaries (including members of the Washington Group) prior to the
Time of Distribution in which Washington Participants were eligible to
participate immediately prior to the Time of Distribution ("Conexant Welfare
Plans"), with such changes or amendments thereto as Washington may deem
appropriate.


                                       12
<PAGE>
         (b) The Washington Welfare Plans will provide for the immediate
participation of those Washington Participants who participated in the
corresponding Conexant Welfare Plans immediately prior to the Time of
Distribution. Each of the Washington Welfare Plans will credit each Washington
Participant thereunder for all Washington Welfare Plan purposes with all service
and any other item which had been credited to or otherwise accumulated for the
benefit of such Washington Participant under the corresponding Conexant Welfare
Plans immediately prior to the Time of Distribution, including service credited
toward any waiting periods and amounts credited toward any medical or health
insurance deductible or co-payment (except to the extent that such crediting
would result in the duplication of benefits). Without limiting the generality of
the foregoing, each Washington Welfare Plan, to the extent applicable: (i) will
recognize all amounts applied to deductibles, co-payments, out-of-pocket
maximums and lifetime maximum benefits with respect to Washington Participants
under the corresponding Conexant Welfare Plan for the plan year that includes
the Time of Distribution and for prior periods (if applicable); (ii) will
recognize all service credited to waiting periods with respect to Washington
Participants under the corresponding Conexant Welfare Plan; (iii) will not
impose any limitations on coverage of pre-existing conditions of Washington
Participants, except to the extent such limitations applied to such Washington
Participants under the corresponding Conexant Welfare Plan immediately prior to
the Time of Distribution; and (iv) will not impose any other conditions (such as
proof of good health, evidence of insurability or a requirement of a physical
examination) upon the participation by Washington Participants who were
participating in the corresponding Conexant Welfare Plan immediately prior to
the Time of Distribution.

         (c) Effective as of the Effective Time, Washington or Alpha will have
established, and will cover Active Washington Employees under, policies relating
to vacation days and personal and sick days that are comparable in the aggregate
to the policies relating to vacation days and personal and sick days maintained
by Conexant immediately prior to the Time of Distribution. Effective as of the
Time of Distribution, Washington and the Washington Subsidiaries will credit
each Active Washington Employee with the unused vacation days and personal and
sickness days accrued by such employee through the Time of Distribution in
accordance with the vacation and personnel policies and agreements of Conexant
and its Subsidiaries (including members of the Washington Group) applicable to
such employee in effect immediately prior to the Time of Distribution.

         (d) (i) From and after the Time of Distribution, Washington and the
Washington Subsidiaries hereby assume or retain, as applicable, and will be
solely responsible for and will fully perform, pay and discharge, all
Liabilities of Conexant or any of its Subsidiaries (including members of the
Washington Group) in respect of Washington Participants (and claims by or
relating to Washington Participants) with respect to employee welfare and fringe
benefits (including medical, dental, vision, life, travel, accident, short- and
long-term disability, hospitalization, workers' compensation and other insurance
benefits), whether under the Conexant Welfare Plans, the Washington Welfare
Plans or otherwise, whether incurred, or arising in connection with incidents
occurring, before, at or after the Time of Distribution and whether any claim is
made with respect thereto before, at or after the Time of Distribution.
Notwithstanding the preceding sentence, Washington and the


                                       13
<PAGE>
Washington Subsidiaries will not be liable for amounts actually paid under
insured Conexant Welfare Plans with respect to which Conexant and its
Subsidiaries have no obligation to reimburse for claims made with respect to
incidents occurring before the Time of Distribution covered thereby.

         (ii) Within 30 days after the Time of Distribution, Washington or Alpha
will obtain run-off workers' compensation insurance coverage in respect of
claims by or relating to Washington Participants for periods prior to the Time
of Distribution, with such coverage and terms as shall be sufficient to satisfy
the requirements of the California Department of Industrial Relations, Division
of Workers' Compensation (the "Division") for the prompt release to Conexant of
the portion of Conexant's total deposit (the "Reserve Amount") as a self-insured
employer with the Division attributable to Washington Participants. Within 20
Business Days after a written request by Conexant, Washington shall pay to
Conexant an amount equal to any amounts paid from the Reserve Amount in respect
of workers' compensation claims by or relating to Washington Participants made
during the period beginning at the Time of Distribution and ending on the date
the portion of the Reserve Amount attributable to Washington Participants has
been released to Conexant.

         (iii) Without limiting the generality of the foregoing and except as
provided in Section 6.07, from and after the Time of Distribution, Washington
and the Washington Subsidiaries (or where appropriate, the Washington Welfare
Plans) hereby assume or retain, as applicable, and will be solely responsible
for and will fully perform, pay and discharge, all Liabilities of Conexant or
any of its Subsidiaries (including members of the Washington Group) in respect
of Washington Participants (and claims by or relating to Washington
Participants) with respect to retiree health and welfare benefits and retiree
life insurance benefits, whether under the Conexant Welfare Plans, the
Washington Welfare Plans or otherwise, whether incurred, or arising in
connection with incidents occurring, before, at or after the Time of
Distribution and whether any claim is made with respect thereto before, at or
after the Time of Distribution.

         (e) (i) From and after the Time of Distribution, Conexant and the
Conexant Subsidiaries hereby assume or retain, as applicable, and will be solely
responsible for and will fully perform, pay and discharge, all Liabilities of
Conexant or any of its Subsidiaries (including members of the Washington Group)
in respect of Conexant Participants (and claims by or relating to Conexant
Participants) with respect to employee welfare and fringe benefits (including
medical, dental, vision, life, travel, accident, short- and long-term
disability, hospitalization, workers' compensation and other insurance
benefits), whether under the Conexant Welfare Plans or otherwise, whether
incurred, or arising in connection with incidents occurring, before, at or after
the Time of Distribution and whether any claim is made with respect thereto
before, at or after the Time of Distribution.

         (ii) Without limiting the generality of the foregoing, from and after
the Time of Distribution, Conexant and the Conexant Subsidiaries (or where
appropriate, the Conexant Welfare Plans) hereby assume or retain, as applicable,
and will be solely responsible for and will fully perform, pay and discharge,
all Liabilities of Conexant or any of its Subsidiaries (including members of the
Washington Group) in respect of Conexant Participants (and


                                       14
<PAGE>
claims by or relating to Conexant Participants) with respect to retiree health
and welfare benefits and retiree life insurance benefits, whether under the
Conexant Welfare Plans or otherwise, whether incurred, or arising in connection
with incidents occurring, before, at or after the Time of Distribution and
whether any claim is made with respect thereto before, at or after the Time of
Distribution.

         Section 6.02 Incentive Compensation Plans. (a) Except as set forth in
Section 6.08, effective as of the Time of Distribution, Washington hereby
assumes or retains, as applicable, and will be solely responsible for and will
fully perform, pay and discharge, all Liabilities (including liability for
earned but unpaid incentive payments) of Conexant or any of its Subsidiaries
(including members of the Washington Group) for, due to and/or attributable to
Washington Participants under the Incentive Compensation Plans and all other
long-term, annual and other incentive compensation plans of Conexant and its
Subsidiaries (including members of the Washington Group) in effect at or prior
to the Time of Distribution.

         (b) Effective as of the Time of Distribution, Conexant hereby assumes
or retains, as applicable, and will be solely responsible for and will fully
perform, pay and discharge, all Liabilities (including liability for earned but
unpaid incentive payments) of Conexant or any of its Subsidiaries (including
members of the Washington Group) for, due to and/or attributable to
Pre-Distribution Group Employees under the Incentive Compensation Plans and all
other long-term, annual and other incentive compensation plans of Conexant and
its Subsidiaries (including members of the Washington Group) in effect at or
prior to the Time of Distribution, other than those assumed by Washington
pursuant to Section 6.02(a).

         (c) Conexant and Washington will cooperate in taking all actions
necessary or appropriate to adjust the performance goals and other applicable
terms and conditions of awards under the Incentive Compensation Plans and such
other incentive compensation plans and arrangements for performance periods that
begin before and end after the Time of Distribution as appropriate to reflect
the Distribution. Without limiting the generality of the foregoing, for purposes
of any Conexant restricted stock awards held by any Active Washington Employee,
continued employment of such employee with Washington or Alpha (or an Affiliate
thereof) following the Time of Distribution shall be treated as continued
employment with Conexant.

         (d) Notwithstanding anything to the contrary in Sections 6.02(a)
through (c), nothing in this Section 6.02 will prevent either Conexant or
Washington from amending or terminating in accordance with the terms thereof any
existing, or implementing any future, incentive compensation plans and
arrangements on such terms as Conexant or Washington may determine in their sole
discretion after the Time of Distribution.

         Section 6.03 Deferred Compensation Plan. As of the Time of
Distribution, Conexant will retain sponsorship of the Conexant Deferred
Compensation Plan and the related Conexant Deferred Compensation Plan Rabbi
Trust. No Active Washington Employees or Former Washington Employees participate
in the Conexant Deferred Compensation Plan. Accordingly, none of Washington or
any member of the Washington


                                       15
<PAGE>
Group will have or retain any interest in or right to any of the assets of the
Conexant Deferred Compensation Plan or the Conexant Deferred Compensation Plan
Rabbi Trust or will have any Liabilities with respect to such plan or trust, and
Conexant will have full power and authority with respect to the Conexant
Deferred Compensation Plan and the Conexant Deferred Compensation Plan Rabbi
Trust.

         Section 6.04 Severance Pay. (a) Conexant, Washington and Alpha
acknowledge and agree that the transactions contemplated by the Transaction
Agreements will not constitute a severance of employment of any employee of
Conexant or any of its Subsidiaries (including members of the Washington Group)
prior to or as a result of the transactions contemplated thereby, and that
individuals who, in connection with the Distribution, become Active Conexant
Employees or Active Washington Employees pursuant to this Agreement will not be
deemed to have experienced a termination, layoff or severance of employment from
Conexant and its Subsidiaries (including members of the Washington Group), in
each case for purposes of any policy, plan, program or agreement of Conexant or
any of its Subsidiaries (including any member of the Washington Group) that
provides for the payment of severance, salary continuation or similar benefits.

         (b) Washington and the Washington Subsidiaries hereby assume or retain,
as applicable, and will be solely responsible for and will fully perform, pay
and discharge, all Liabilities of Conexant or any of its Subsidiaries (including
members of the Washington Group) in connection with claims made by or on behalf
of Washington Participants in respect of severance pay, salary continuation and
similar obligations relating to the termination or alleged termination (whether
voluntary or involuntary) of any such person's employment, whether such
termination or alleged termination occurred before, at or after the Time of
Distribution and whether any claim is made with respect thereto before, at or
after the Time of Distribution (whether or not such claim is based on any
severance policy, agreement, arrangement or program which may exist or arise
under any employment, collective bargaining or other agreement or under any
Federal, state, local, provincial or foreign law).

         (c) Conexant and the Conexant Subsidiaries hereby assume or retain, as
applicable, and will be solely responsible for and will fully perform, pay and
discharge, all Liabilities of Conexant or any of its Subsidiaries (including
members of the Washington Group) in connection with claims made by or on behalf
of Pre-Distribution Group Employees in respect of severance pay, salary
continuation and similar obligations relating to the termination or alleged
termination (whether voluntary or involuntary) of any such person's employment,
whether such termination or alleged termination occurred before, at or after the
Time of Distribution and whether any claim is made with respect thereto before,
at or after the Time of Distribution (whether or not such claim is based on any
severance policy, agreement, arrangement or program which may exist or arise
under any employment, collective bargaining or other agreement or under any
Federal, state, local, provincial or foreign law), other than those expressly
assumed by Washington pursuant to Section 6.04(b).

         Section 6.05 Employment, Consulting and Other Employee Related
Agreements. (a) Effective as of the Time of Distribution, Washington and the
Washington Subsidiaries hereby assume or retain, as applicable, and will be
solely responsible for and will


                                       16
<PAGE>
fully perform, pay and discharge, all Liabilities of Conexant or any of its
Subsidiaries (including members of the Washington Group) relating to all
Washington Participants under their respective employment, consulting,
separation, arbitration and other employee related agreements with any member of
the Pre-Distribution Group, as the same are in effect immediately prior to the
Time of Distribution.

         (b) Effective as of the Time of Distribution, Conexant and the Conexant
Subsidiaries hereby assume or retain, as applicable, and will be solely
responsible for and will fully perform, pay and discharge, all Liabilities of
Conexant or any of its Subsidiaries (including members of the Washington Group)
relating to all Pre-Distribution Group Employees under their respective
employment, consulting, separation, arbitration and other employee related
agreements with any member of the Pre-Distribution Group, as the same are in
effect immediately prior to the Time of Distribution, other than those expressly
assumed by Washington pursuant to Section 6.05(a).

         Section 6.06 Employee Stock Purchase Plans. (a) Effective as of the
Effective Time, Alpha will have established, and will cover eligible Active
Washington Employees under, (i) an employee stock purchase plan which is
comparable to the Conexant 2001 ESPP (the "Washington ESPP") and (ii) a
non-qualified employee stock purchase plan which is comparable in all material
respects to the Conexant Non-Qualified ESPP (the "Washington Non-Qualified
ESPP"). Each of the Washington ESPP and the Washington Non-Qualified ESPP will
credit each participating Active Washington Employee thereunder for purposes of
eligibility and vesting with all service which had been credited to such
employee for such purposes under the Conexant 2001 ESPP and the Conexant
Non-Qualified ESPP, respectively, immediately prior to the Time of Distribution.

         (b) Nothing contained in this Agreement shall require Conexant,
Washington or Alpha to continue to maintain any employee stock purchase plan,
program, or arrangement following the Time of Distribution.

         (c) As of the Time of Distribution, Conexant will retain sponsorship of
the Conexant 2001 ESPP, the Conexant Non-Qualified ESPP and the Conexant 1999
ESPP. Effective as of the Effective Time, each Active Washington Employee will
be treated as having terminated employment with Conexant and the Conexant
Subsidiaries for purposes of determining his or her eligibility to participate
in the Conexant 2001 ESPP, the Conexant Non-Qualified ESPP and the Conexant 1999
ESPP. Accordingly, none of Washington or any member of the Washington Group will
have or retain any interest in or right to any of the assets of the Conexant
2001 ESPP, the Conexant Non-Qualified ESPP and the Conexant 1999 ESPP or will
have any Liabilities with respect to such plans, and Conexant will have full
power and authority with respect to the Conexant 2001 ESPP, the Conexant
Non-Qualified ESPP and the Conexant 1999 ESPP.

Section 6.07 VERP. (a) Effective as of the Effective Time, Washington or Alpha
will have established a new voluntary early retirement program (the "Washington
VERP"), the purpose of which will be to provide benefits to Washington
Participants who participate in the Conexant VERP immediately prior to the Time
of Distribution, and a trust


                                       17
<PAGE>
related thereto (the "Washington VERP Trust"). The Washington VERP will be
substantially similar in all material respects to the Conexant VERP. The
Washington VERP will credit each Washington Participant thereunder for purposes
of eligibility to participate and benefit accruals and all other plan purposes
with all service which has been credited to such participant for such purposes
under the Conexant VERP immediately prior to the Time of Distribution (except to
the extent that such crediting would result in the duplication of benefits).

         (b) Effective as of the Time of Distribution, Washington and the
Washington Subsidiaries hereby assume and agree to fully perform, pay and
discharge, and agree to cause the Washington VERP and the Washington VERP Trust
to assume, and to fully perform, pay and discharge, all accrued benefit and
other Liabilities of Conexant or any of its Subsidiaries (including members of
the Washington Group) and of the Conexant VERP and the Conexant VERP Trust under
and relating to the Conexant VERP and the Conexant VERP Trust with respect to
Washington Participants who were covered under the Conexant VERP prior to the
Time of Distribution.

         (c) Effective as of the Time of Distribution, Conexant and the Conexant
Subsidiaries hereby retain and agree to fully perform, pay and discharge, and
agree to cause the Conexant VERP and the Conexant VERP Trust to retain, and to
fully perform, pay and discharge, all accrued benefit and other Liabilities of
Conexant or any of its Subsidiaries (including members of the Washington Group)
and of the Conexant VERP and the Conexant VERP Trust under and relating to the
Conexant VERP and the Conexant VERP Trust, other than those expressly assumed by
Washington pursuant to Section 6.07(b).

         (d) On or prior to the Time of Distribution, Conexant will cause the
Conexant VERP Trust to transfer to the Washington VERP Trust, for the benefit of
Washington Participants who participated in the Conexant VERP prior to the Time
of Distribution, a proportionate share of the assets of the Conexant VERP Trust,
the amount of which will be equal to the product of: (i) the aggregate value of
all of the assets of the Conexant VERP Trust as of the date of transfer
multiplied by (ii) the quotient of (A) the actuarial present value of
accumulated plan benefits under the Conexant VERP for all Washington
Participants participating in the Conexant VERP as of the date of transfer
divided by (B) the actuarial present value of accumulated plan benefits under
the Conexant VERP for all participants participating in the Conexant VERP as of
the date of transfer. For purposes of determining such actuarial present value
of accumulated plan benefits under the Conexant VERP, the following actuarial
assumptions will be used: (x) life expectancy of participants shall be
determined using the 1985 Male and Female Group Annuity Maturity Table, (y) the
average retirement age shall be age 56.3 and (z) the average annual investment
return shall be 4.00%. The assets to be transferred from the Conexant VERP Trust
to the Washington VERP Trust, as calculated as set forth above, will be reduced
by the amount of any benefit payment to any Washington Participant under the
Conexant VERP after the Time of Distribution (or the Washington VERP will
otherwise promptly reimburse the Conexant VERP for any such benefit payment to a
Washington Participant) and a proportional share of investment and
administrative expenses. The amount of assets to be transferred from the
Conexant VERP Trust to the Washington VERP Trust pursuant to this Section
6.07(d) will be calculated by


                                       18
<PAGE>
Conexant's actuary. The transfer of assets from the Conexant VERP Trust to the
Washington VERP Trust will be made in cash, mutual fund account balances or
other property, as determined by Conexant.

         (e) Notwithstanding anything to the contrary in this Section 6.07, in
the case of retiree medical and life insurance benefits provided to participants
in the Conexant VERP on account of a retiree medical and life insurance benefit
program sponsored by a predecessor of Conexant, Washington hereby agrees to
assume responsibility for administering and providing such benefits to
Washington Participants after the Time of Distribution and will establish not
later than August 31, 2002 a new retiree medical and life insurance program
substantially similar in all material respects to the Conexant retiree medical
and life insurance program to provide benefits to Washington Participants who
participate in the Conexant retiree medical and life insurance program
immediately prior to the Time of Distribution; provided, however, that during a
transition period ending not later than August 31, 2002, Conexant will continue
to administer and provide such benefits to Washington Participants on behalf of
Washington at Washington's expense; provided, further, that Washington will
reimburse Conexant for all all-out-pocket fees, costs and expenses of
administering and providing such benefits to Washington Participants incurred by
Conexant during the transition period, including, but not limited to (i) Sageo
administration fees, including any implementation costs not billed directly to
Washington in connection with setting up the new Washington retiree medical and
life insurance benefit program, (ii) ASO, stop loss and any related fees payable
to BlueShield of California for self-insured claims administration for the
Catastrophic, PPO and Indemnity Plans in which Washington Participants are
currently enrolled under the Conexant retiree medical and life insurance
program, (iii) claims incurred under any of the Catastrophic, PPO and Indemnity
Plans, as well as payment of runout claims, with respect to Washington
Participants, (iv) HMO and Medicare Risk premiums payable to HealthNet HMO with
respect to Washington Participants, (v) life insurance premiums payable to John
Hancock Life with respect to Washington Participants and (vi) other fees and
expenses incurred to segregate Washington Participant fees and claims.

         Section 6.08 Performance Share Plan. As of the Time of Distribution,
Conexant will retain sponsorship of the Conexant Performance Share Plan.
Effective as of the Effective Time, each Active Washington Employee will be
treated as having terminated employment with Conexant and the Conexant
Subsidiaries for purposes of determining his or her eligibility to participate
in the Conexant Performance Share Plan and will have no rights to any payment
under such plan from and after the Time of Distribution, other than any rights
to any payments for awards previously vested and earned pursuant to the terms of
the plan. None of Washington or any member of the Washington Group will have or
retain any interest in or right to any of the assets of the Conexant Performance
Share Plan or will have any Liabilities with respect to such plan, and Conexant
will have full power and authority with respect to the Conexant Performance
Share Plan.

         Section 6.09 Other Liabilities. (a) From and after the Time of
Distribution, except as specifically set forth in this Agreement, Washington and
the Washington Subsidiaries hereby assume or retain, as applicable, and will be
solely responsible for and will


                                       19
<PAGE>
fully perform, pay and discharge, all Liabilities of Conexant or any of its
Subsidiaries (including members of the Washington Group) arising out of or
relating to the employment of Washington Participants by any member of the
Pre-Distribution Group, whether pursuant to benefit plans or otherwise and
whether such Liabilities arose before, at or after the Time of Distribution or
any claim is made with respect thereto before, at or after the Time of
Distribution; provided, however, that nothing in this Agreement shall be
construed as obligating Washington, the Washington Subsidiaries or Alpha to
assume any obligation with respect to any defined benefit pension plan, other
than the Washington VERP.

         (b) From and after the Time of Distribution, except as specifically set
forth in this Agreement, Conexant and the Conexant Subsidiaries hereby assume or
retain, as applicable, and will be solely responsible for and will fully
perform, pay and discharge, all Liabilities of Conexant or any of its
Subsidiaries (including members of the Washington Group) arising out of or
relating to the employment of Pre-Distribution Group Employees by any member of
the Pre-Distribution Group, whether pursuant to benefit plans or otherwise and
whether such Liabilities arose before, at or after the Time of Distribution or
any claim is made with respect thereto before, at or after the Time of
Distribution, other than those expressly assumed by Washington pursuant to
Section 6.09(a).

                                  ARTICLE VII

                                  MISCELLANEOUS


         Section 7.01 Indemnification. All Liabilities retained or assumed by or
allocated to Washington, any Washington Subsidiary or Alpha pursuant to this
Agreement will be deemed to be Washington Liabilities (as defined in the
Distribution Agreement), and all Liabilities retained or assumed by or allocated
to Conexant or any Conexant Subsidiary pursuant to this Agreement will be deemed
to be Conexant Liabilities (as defined in the Distribution Agreement), and, in
each case, will be subject to the indemnification provisions set forth in
Article IV of the Distribution Agreement.

         Section 7.02 Sharing of Information. Each of Conexant, Washington and
Alpha will, and will cause each of their respective Subsidiaries to, provide to
the other parties all such Information in its possession as the other parties
may reasonably request to enable the requesting party to administer its employee
benefit plans and programs, and to determine the scope of, and fulfill, its
obligations under this Agreement. Such Information will, to the extent
reasonably practicable, be provided in the format and at the times and places
requested, but in no event will the party providing such Information be
obligated to incur any out-of-pocket expense not reimbursed by the party making
such request, nor to make such Information available outside its normal business
hours and premises. Any Information shared or exchanged pursuant to this
Agreement will be subject to the confidentiality requirements set forth in the
Distribution Agreement.

         Section 7.03 Entire Agreement; Construction. This Agreement, the
Distribution Agreement and the other Ancillary Agreements, including any
schedules and


                                       20
<PAGE>
exhibits hereto or thereto, and other agreements and documents referred to
herein and therein, will together constitute the entire agreement between the
parties with respect to the subject matter hereof and thereof and will supersede
all prior negotiations, agreements and understandings of the parties of any
nature, whether oral or written, with respect to such subject matter.
Notwithstanding any other provisions in the Transaction Agreements to the
contrary, in the event and to the extent that there is a conflict between the
provisions of this Agreement and the provisions of the Distribution Agreement,
the provisions of this Agreement will control.

         Section 7.04 Survival of Agreements. Except as otherwise contemplated
by the Transaction Agreements, all covenants and agreements of the parties
contained in this Agreement will remain in full force and effect and survive the
Time of Distribution.

         Section 7.05 Governing Law. This Agreement will be governed by and
construed in accordance with the internal laws of the State of Delaware
applicable to contracts made and to be performed entirely within such State,
without regard to the conflicts of law principles of such State.

         Section 7.06 Notices. All notices, requests, claims, demands and other
communications required or permitted to be given hereunder will be in writing
and will be delivered by hand, telecopied, e-mailed or sent, postage prepaid, by
registered, certified or express mail or reputable overnight courier service and
will be deemed given when so delivered by hand or telecopied, when e-mail
confirmation is received if delivered by e-mail, or three business days after
being so mailed (one business day in the case of express mail or overnight
courier service). All such notices, requests, claims, demands and other
communications will be addressed as set forth in Section 7.04 of the
Distribution Agreement (provided that such notices, requests, claims, demands
and other communications to Alpha shall be addressed to Alpha at the same notice
address set forth for Washington in Section 7.04 of the Distribution Agreement),
or pursuant to such other instructions as may be designated in writing by the
party to receive such notice.

         Section 7.07 Amendments. This Agreement cannot be amended, modified or
supplemented except by a written agreement executed by each party affected
thereby.

         Section 7.08 Assignment. No party to this Agreement will convey, assign
or otherwise transfer any of its rights or obligations under this Agreement
without the prior written consent of the other parties in their sole and
absolute discretion. Notwithstanding the foregoing, any party may (without
obtaining any consent) assign, delegate or sublicense all or any portion of its
rights and obligations hereunder to (i) the surviving entity resulting from a
merger or consolidation involving such party, (ii) the acquiring entity in a
sale or other disposition of all or substantially all of the assets of such
party as a whole or of any line of business or division of such party, or (iii)
any other Person that is created as a result of a spin-off from, or similar
reorganization transaction of, such party or any line of business or division of
such party. In the event of an assignment pursuant to (ii) or (iii) above, the
nonassigning party shall, at the assigning party's request, use good faith
commercially reasonable efforts to enter into separate agreements with each of
the resulting entities and take


                                       21
<PAGE>
such further actions as may be reasonably required to assure that the rights and
obligations under this Agreement are preserved, in the aggregate, and divided
equitably between such resulting entities. Any conveyance, assignment or
transfer requiring the prior written consent of another party pursuant to this
Section 7.08 which is made without such consent will be void ab initio. No
assignment of this Agreement will relieve the assigning party of its obligations
hereunder.

         Section 7.09 Captions; Currency. The article, section and paragraph
captions herein and the table of contents hereto are for convenience of
reference only, do not constitute part of this Agreement and will not be deemed
to limit or otherwise affect any of the provisions hereof. Unless otherwise
specified, all references herein to numbered articles or sections are to
articles and sections of this Agreement and all references herein to schedules
are to schedules to this Agreement. Unless otherwise specified, all references
contained in this Agreement, in any schedule referred to herein or in any
instrument or document delivered pursuant hereto to dollars or $ will mean
United States Dollars.

         Section 7.10 Severability. If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances other than those as to which it has been held invalid or
unenforceable, will remain in full force and effect and will in no way be
affected, impaired or invalidated thereby. If the economic or legal substance of
the transactions contemplated hereby is affected in any manner adverse to any
party as a result thereof, the parties will negotiate in good faith in an effort
to agree upon a suitable and equitable substitute provision to effect the
original intent of the parties.

         Section 7.11 Parties in Interest. This Agreement is binding upon and is
for the benefit of the parties hereto and their respective successors and
permitted assigns. This Agreement is not made for the benefit of any Person not
a party hereto, and no Person other than the parties hereto or their respective
successors and permitted assigns will acquire or have any benefit, right, remedy
or claim under or by reason of this Agreement. No provision of this Agreement
will be construed (a) to limit the right of Conexant, any Conexant Subsidiary,
Washington, any Washington Subsidiary or Alpha to amend or terminate any of
their plans or (b) to create any right or entitlement whatsoever in any
employee, former employee or beneficiary including a right to continued
employment or to any benefit under a plan or any other benefit or compensation.

         Section 7.12 Schedules. All schedules attached hereto are hereby
incorporated in and made a part of this Agreement as if set forth in full
herein. Capitalized terms used in the schedules hereto but not otherwise defined
therein will have the respective meanings assigned to such terms in this
Agreement.

         Section 7.13 Change of Name. On or promptly after the Distribution
Date, Washington will take such actions as may be required to change the names
of all employee benefit plans sponsored or maintained by Washington, any
Washington Subsidiary or Alpha


                                       22
<PAGE>
to eliminate therefrom any reference to "Conexant", "Conexant Systems",
"Conexant Systems, Inc." or any derivative thereof.

         Section 7.14 Waivers; Remedies. No failure or delay on the part of
Conexant, Washington or Alpha in exercising any right, power or privilege
hereunder will operate as a waiver thereof, nor will any waiver on the part of
Conexant, Washington or Alpha of any right, power or privilege hereunder operate
as a waiver of any other right, power or privilege hereunder, nor will any
single or partial exercise of any right, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege hereunder. The rights and remedies herein provided are cumulative
and are not exclusive of any rights or remedies which the parties may otherwise
have at law or in equity.

         Section 7.15 Counterparts. This Agreement may be executed in separate
counterparts, each such counterpart being deemed to be an original instrument,
and all such counterparts will together constitute the same agreement.

         Section 7.16 Performance. Conexant will cause to be performed and
hereby guarantees the performance of all actions, agreements and obligations set
forth herein to be performed by any Conexant Subsidiary. Washington will cause
to be performed and hereby guarantees the performance of all actions, agreements
and obligations set forth herein to be performed by any Washington Subsidiary.
Alpha will cause to be performed and hereby guarantees the performance of all
actions, agreements and obligations set forth herein to be performed by any
Subsidiary or Affiliate of Alpha. In addition, Alpha and Conexant acknowledge
that from and after the Effective Time (as defined in the Merger Agreement),
Alpha will succeed to all rights, obligations and Liabilities of Washington
under this Agreement.

         Section 7.17 Dispute Resolution. Any dispute, claim or controversy
arising out of or relating to any provision of this Agreement or the breach,
performance or validity thereof will be resolved in accordance with the
procedures set forth in Section 7.05 of the Distribution Agreement.

         Section 7.18 Cooperation. Conexant, Washington and Alpha will cooperate
in taking all such action as may be necessary or appropriate to implement the
provisions of this Agreement, including making all appropriate filings as may be
required under ERISA or the Code, the regulations thereunder and any other
applicable laws, exchanging and sharing all appropriate records, amending plan,
trust, record keeping and other related documents and implementing all
appropriate communications with participants.


                                       23
<PAGE>
         Section 7.19 Interpretation. Any reference to any Federal, state,
local, provincial or foreign law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. For
the purposes of this Agreement, (i) words in the singular shall be held to
include the plural and vice versa and words of one gender shall be held to
include the other gender as the context requires, (ii) the terms "hereof",
"herein", and "herewith" and words of similar import shall, unless otherwise
stated, be construed to refer to this Agreement as a whole and not to any
particular provision of this Agreement, (iii) the word "including" and words of
similar import when used in this Agreement shall mean "including, without
limitation" and (iv) all references to any plan shall be deemed to include any
amendments thereto.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]


                                       24
<PAGE>
         IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the duly authorized officers of the parties as of the date first hereinabove
written.


                                      CONEXANT SYSTEMS, INC.


                                      By: /s/ DENNIS E. O'REILLY
                                          --------------------------------------
                                          Name:  Dennis E. O'Reilly
                                          Title: Senior Vice President, General
                                                 Counsel and Secretary



                                      WASHINGTON SUB, INC.


                                      By: /s/ DENNIS E. O'REILLY
                                          --------------------------------------
                                          Name:  Dennis E. O'Reilly
                                          Title: Vice President and Secretary



                                      ALPHA INDUSTRIES, INC.


                                      By: /s/ PAUL E. VINCENT
                                          --------------------------------------
                                          Name:  Paul E. Vincent
                                          Title: Vice President, Chief Financial
                                                 Officer, Treasurer & Secretary


                                       25


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.4
<SEQUENCE>11
<FILENAME>b43517ssexv99w4.txt
<DESCRIPTION>PRESS RELEASE BY CONEXANT AND ALPHA INDUSTRIES
<TEXT>
<PAGE>
                                                                    Exhibit 99.4

ALPHA AND CONEXANT'S WIRELESS BUSINESS COMPLETE MERGER; SKYWORKS COMMENCES
OPERATIONS AS AN INDEPENDENT COMPANY

WOBURN, Mass. and NEWPORT BEACH, Calif.
     --(BUSINESS WIRE)--June 26, 2002--

SKYWORKS BECOMES AN INDUSTRY LEADING WIRELESS SEMICONDUCTOR COMPANY FOR MOBILE
COMMUNICATIONS

     Alpha Industries, Inc. (Nasdaq: AHAA) and Conexant Systems, Inc. (Nasdaq:
CNXT) today announced that the merger of Alpha and Conexant's wireless business
to create Skyworks Solutions, Inc. has been completed. The new company's common
stock will begin trading today on the Nasdaq Stock Market under the ticker
symbol "SWKS."

     Skyworks begins operations as the industry's leading wireless semiconductor
company focused on radio frequency (RF) and complete semiconductor system
solutions for mobile communications applications. Skyworks has an established
leadership position in such critical product areas as RF switches and power
amplifiers modules. In addition, the company is uniquely positioned to drive the
evolution of RF integration for all major air interfaces, including code
division multiple access (CDMA) and global system for mobile communications
(GSM), as well as complete semiconductor and software solutions for advanced
2.5G and 3G applications.

     "We are simply delighted to launch Skyworks today -- a leader in mobile
communications semiconductors," said David J. Aldrich, Skyworks' president and
chief executive officer. "Our product breadth, technologies, manufacturing
strength, and customer relationships make us an ideal partner for today's
handset and base station manufacturers. This advantage translates into faster
time-to-market, lower cost and smaller more feature-rich products for
consumers."

     "With a winning combination of critical technologies and products, Skyworks
begins life today with a very promising future," said Dwight W. Decker,
Skyworks' chairman of the board, and chairman and chief executive officer of
Conexant. "Skyworks' leadership position in front-end modules, RF subsystems and
complete cellular solutions enables the company to deliver best-in-class
components and systems to all of the industry's key handset and base station
manufacturers."

     Skyworks will employ approximately 3,850 people worldwide, including
approximately 1,900 located at the company's semiconductor assembly, module
manufacturing and test operation in Mexicali, Mexico. The company has design,
engineering, manufacturing, marketing, sales and service facilities throughout
North America, Europe, Japan and Asia Pacific.

RESTRUCTURED MEXICALI NOTE


<PAGE>


     Skyworks has purchased Conexant's semiconductor assembly, module
manufacturing and test facility, located in Mexicali, Mexico, for $150 million
through a secured promissory note payable 50 percent in nine months and 50
percent in twelve months. In addition, Skyworks will have a line of credit for
one year of up to $100 million to cover working capital requirements.

     "With the financing, Skyworks now has considerably more financial
flexibility going forward," said Aldrich.

FACTS ABOUT SKYWORKS

General Facts:

COMPANY NAME: Skyworks Solutions, Inc. (Nasdaq: SWKS)

Skyworks is the result of the merger between Alpha Industries, Inc. (Nasdaq:
AHAA) and the wireless communications business of Conexant Systems, Inc.
(Nasdaq: CNXT)

HEADQUARTERS: Woburn, Mass., with executive offices in Newport Beach, Calif.

WORLDWIDE EMPLOYEES: Approximately 3,850 people

ANNUAL PRO FORMA NET REVENUES (PERIOD ENDING SEPT. 30, 2001): $458 million

SENIOR MANAGEMENT:

     David J. Aldrich, 45, president and chief executive officer

     Paul E. Vincent, 54, chief financial officer

     Kevin D. Barber, 42, senior vice president of operations

     Liam K. Griffin, 35, vice president of sales and marketing

     George M. LeVan, 56, vice president of human resources

MANUFACTURING LOCATIONS:

     Woburn, Mass.: Gallium Arsenide (GaAs) PHEMT and MESFET wafer fabrication

     Sunnyvale, Calif.: GaAs HBT, PHEMT and MESFET wafer fabrication

     Newbury Park, Calif.: GaAs HBT wafer fabrication

     Adamstown, Md.: RF ceramic components


                                       2
<PAGE>


     Mexicali, Mexico: High-volume semiconductor device assembly (module,
          lead-frame packages, ball-grid array) and testing (RF, digital,
          mixed-signal)

KEY PRODUCT AREAS:

     Front-end Modules: Skyworks is the market leader in delivering switching
          solutions and power amplifier modules in GaAs PHEMT and HBT.

     RF Subsystems: Skyworks has developed the world's most highly integrated
          direct conversion radio (DCR) enabling full transmit and receive chain
          functionality in a single package.

     Cellular Systems: Skyworks offers the industry's most comprehensive 2.5G
          GSM/General Packet Radio Service (GSM/GPRS) solution, including the
          complete RF subsystem, baseband processor as well as protocol stack
          and user interface software, plus complete reference designs and
          development platforms.

     Infrastructure Products: Skyworks leverages its integrated RF product and
          technology capabilities across strong base station channel
          relationships.

ABOUT SKYWORKS

     Skyworks Solutions, Inc. (Nasdaq: SWKS) is the industry's leading wireless
semiconductor company focused on radio frequency (RF) and complete semiconductor
system solutions for mobile communications applications. The company began
operations in June 2002, following the completion of the merger between Alpha
Industries, Inc. and Conexant Systems, Inc.'s wireless communications business.
Skyworks is focused on providing front-end modules, RF subsystems and complete
system solutions to wireless handset and infrastructure customers worldwide.

     Skyworks is headquartered in Woburn, Mass., with executive offices in
Newport Beach, Calif. The company has design, engineering, manufacturing,
marketing, sales and service facilities throughout North America, Europe, Japan
and Asia Pacific. For more information please visit www.skyworksinc.com.

ABOUT CONEXANT

     Conexant Systems, Inc. is a worldwide leader in semiconductor system
solutions for communications applications. Conexant leverages its expertise in
mixed-signal processing to deliver integrated systems and semiconductor products
through three separate businesses that address the wireless communications,
broadband access and Internet infrastructure markets.


                                       3
<PAGE>


     Conexant's wireless communications business is focused on providing power
amplifiers, radio-frequency subsystems and complete systems solutions. The
broadband access business develops and delivers integrated solutions that enable
digital entertainment and information networks for the home and small office.

     Mindspeed Technologies, the company's Internet infrastructure business,
designs, develops and sells a complete portfolio of semiconductor networking
solutions that facilitate the aggregation, transmission and switching of data,
video and voice from the edge of the Internet to linked metropolitan area
networks and long-haul networks.

     Conexant, headquartered in Newport Beach, Calif., delivered revenues of
$1.1 billion for fiscal 2001. The company is a member of the Nasdaq-100 index.
To learn more, visit us at www.conexant.com or www.mindspeed.com.

SAFE HARBOR STATEMENT

     This news release includes "forward-looking statements" intended to qualify
for the safe harbor from liability established by the Private Securities
Litigation Reform Act of 1995. These forward-looking statements include
information relating to future results of Skyworks (including certain
projections and business trends). All such statements are subject to certain
risks and uncertainties that could cause actual results to differ materially
from those projected, and may affect our future operating results, financial
position and cash flows.

     These risks and uncertainties include, but are not limited to: global
economic and market conditions, such as the cyclical nature of the wireless
communications semiconductor industry and the markets addressed by the company's
and its customers' products; demand for and market acceptance of new and
existing products; the ability to develop, manufacture and market innovative
products in a rapidly changing technological environment; the ability to compete
with products and prices in an intensely competitive industry; product
obsolescence; losses or curtailments of purchases from key customers or the
timing of customer inventory adjustments; the timing of new product
introductions; the availability and extent of utilization of raw materials,
critical manufacturing equipment and manufacturing capacity; pricing pressures
and other competitive factors; changes in product mix; fluctuations in
manufacturing yields; the ability to continue to grow and maintain an
intellectual property portfolio and obtain needed licenses from third parties;
the ability to attract and retain qualified personnel; labor relations of the
company, its customers and suppliers; economic, social and political conditions
in the countries in which Skyworks, its customers or its suppliers operate,
including security risks, possible disruptions in transportation networks and
fluctuations in foreign currency exchange rates; and the uncertainties of
litigation, as well as other risks and uncertainties, including but not limited
to those detailed from time to time in the company's Securities and Exchange
Commission filings.

     These forward-looking statements are made only as of the date hereof, and
the company undertakes no obligation to update or revise the forward-looking
statements,


                                       4
<PAGE>


whether as a result of new information, future events or otherwise. Skyworks and
Skyworks Solutions are trademarks or registered trademarks of Skyworks
Solutions, Inc. or its subsidiaries in the U.S. and in other countries. All
other brands and names listed are trademarks of their respective companies.


                                       5

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